Changzhou Trina Solar Energy Co. v. United States

450 F.Supp.3d 1301

CHANGZHOU TRINA SOLAR ENERGY CO., LTD. et al., Plaintiffs and Consolidated Plaintiffs,andJA Solar Technology Yangzhou Co., Ltd. et al., Plaintiff-Intervenors,

v. UNITED STATES, Defendant,andSolarWorld Americas, Inc. et al., Defendant-Intervenor and Consolidated Defendant-Intervenors.

Slip Op. 20-64

Consol. Court No. 18-00176

United States Court of International Trade.

May 13, 2020

Jonathan Michael Freed, Trade Pacific, PLLC, of Washington, DC, argued for plaintiff, defendant-intervenor, and consolidated defendant-intervenor Changzhou Trina Solar Energy Co., Ltd., and plaintiffs Trina Solar (Changzhou) Science & Technology Co., Ltd. and Trina Solar (U.S.) Inc. With him on the briefs was Robert George Gosselink.

Jeffrey S. Grimson, Mowry & Grimson, PLLC, of Washington, DC, for consolidated plaintiffs and plaintiff intervenors JA Solar Technology Yangzhou Co., Ltd., Shanghai JA Solar Technology Co., Ltd. and JingAo Solar Co., Ltd. With him on the briefs were Kristin H. Mowry, Jill A. Cramer, Sarah M. Wyss, and Bryan P. Cenko

Timothy C. Brightbill, Wiley Rein, LLP, of Washington, DC, argued for consolidated plaintiff and defendant-intervenor SolarWorld Americas, Inc. With him on the briefs were Laura El-Sabaawi, Usha Neelakantan, Stephen J. Obermeier, and Enbar Toledano.

Tara K. Hogan, Assistant Director, argued for defendant. With her on the brief were Joshua E. Kurland, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, Jeanne E. Davidson, Director, and Joseph H. Hunt, Assistant Attorney General. Of Counsel on the brief was Mercedes Morno, Senior Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC. Also appearing as Of Counsel was Ian A. McInerney, U.S. Department of Commerce, of Washington, DC.

OPINION AND ORDER

Kelly, Judge:

This consolidated action is before the court on motions for judgment on the agency record filed by Changzhou Trina Solar Energy Co., Ltd., Trina Solar (Changzhou) Science & Technology Co., Ltd., Yancheng Trina Solar Energy Technology Co., Ltd., Changzhou Trina Solar Yabang Energy Co., Ltd., Turpan Trina Solar Energy Co., Ltd., Hubei Trina Solar Energy Co., Ltd., and Trina Solar (Hefei) Science & Technology Co., Ltd., (collectively, "Trina"); JA Solar Technology Yangzhou Co., Ltd., Shanghai JA Solar Technology Co., Ltd. and JingAo Solar Co., Ltd. (collectively, "JA Solar"); and SolarWorld Americas, Inc. ("SolarWorld").¹ See [Trina's] 56.2 Mot. J. Agency R., Feb. 15, 2019, ECF No. 41; Consol. Pls.’ & Pl.-Intervenors’ 56.2 Mot. J. Agency R., Feb. 15, 2019, ECF No. 43; SolarWorld's Mot. J. Agency. R., Feb. 15, 2019, ECF No. 44.

Trina, JA Solar, and SolarWorld challenge various aspects of the U.S. Department of Commerce's ("Commerce") final determination in the fourth administrative review of the antidumping duty ("ADD") order covering crystalline silicon photovoltaic cells, whether or not assembled into modules ("solar cells" or "solar panels"), from the People's Republic of China ("PRC" or "China"). See [Trina's] Memo. Supp. Mot. J. Agency R. Confidential Version, Feb. 15, 2019, ECF No. 42 ("Trina's Br."); [JA Solar's] Memo. Supp. 56.2 Mot. J. Agency R., Feb. 15, 2019, ECF No. 43-1; [SolarWorld's] Memo. Supp. 56.2 Mot. J. Agency R. Revised Confidential Version, Feb. 15, 2019, ECF No. 45 ("SolarWorld's Br."); see also Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the [PRC], 83 Fed. Reg. 35,616 (Dep't Commerce July 27, 2018) (final results of [ADD] admin. review and final determination of no shipments; 2015–2016) ("Final Results") and accompanying Issues and Decisions Memo. for the [Final Results ], A-570-979, (July 11, 2018), ECF No. 36-5 ("Final Decision Memo"); see also Initiation of [ADD] & Countervailing Duty Admin. Reviews, 82 Fed. Reg. 10,457 (Dep't Commerce Feb. 13, 2017) ("Initiation of Reviews"); Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the [PRC], 77 Fed. Reg. 73,018 (Dep't Commerce Dec. 7, 2012) (amended final determination of sales at less than fair value, and [ADD] order) ("ADD Order").

For the reasons that follow, the court sustains Commerce's decisions to include zero quantity Thai import data when calculating surrogate values, derive surrogate financial ratios using KCE's unconsolidated financial statements, and value Trina's nitrogen inputs using Mexican import data. However, the court remands for further explanation or reconsideration Commerce's refusal to adjust Trina's constructed export price ("U.S. Price") to account for a countervailed subsidy, as well as its reliance on Maersk Line ("Maersk") rate quotes to value Trina's international freight expenses.

BACKGROUND

On December 7, 2012, Commerce published its determination to issue an ADD order on solar cells from the PRC. See generally ADD Order. On February 13, 2017, in response to timely requests, Commerce initiated its fourth administrative review of the ADD Order. See generally Initiation of Reviews. Commerce selected Trina as the sole mandatory respondent for individual examination.² See Resp't Selection Memo. [for 2015–2016 ADD Admin. Review], PD 147, bar code 3571565-01 (May 12, 2017);³ Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the [PRC], 83 Fed. Reg. 1,018 (Dep't Commerce Jan. 9, 2018) (prelim. results of [ADD] admin. review and prelim. determination of no shipments; 2015–2016) ("Prelim. Results") and accompanying Issues and Decisions Memo. for the [Prelim. Results ] at 2–3, A-570-979, PD 363, bar code 3657733-01 (Jan. 2, 2018) ("Prelim. Decision Memo"). Commerce considers the PRC to be a nonmarket economy ("NME"); thus, when calculating Trina's dumping margin, Commerce determined the normal value of Trina's merchandise by using prices from a surrogate market economy country to value factors utilized to produce the subject merchandise ("factors of production" or "FOPs").⁴ See Section 773(c)(4) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1677b(c)(4) (2012).⁵ Commerce chose Thailand as the primary surrogate country. See Prelim. Decision Memo at 14–17.

For the Prelim. Results, when calculating Trina's dumping margin, Commerce declined to increase Trina's U.S. Price to account for the 5.46 percent ad valorem countervailing duty ("CVD") rate it imposed, based on facts available with an adverse inference, on the subject merchandise in the most recent review of the companion CVD order ("companion CVD review"). See Prelim. Decision Memo at 30; see also Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the [PRC], 82 Fed. Reg. 32,678 (Dep't Commerce July 17, 2017) (final results of [CVD] admin. review, and partial rescission of [CVD] admin. review; 2014) ("3^rd CVD AR") and accompanying Issues and Decisions Memo. for [3^rd CVD AR ] at Cmts. 1–2, C-570-980, (July 10, 2017), available at https://enforcement.trade.gov/frn/summary/prc/2017-14957-1.pdf (last visited Apr. 30, 2020) ("3^rd CVD AR IDM").⁶ When calculating Trina's ocean freight expenses, Commerce relied on international freight rates from Maersk, a transportation and logistics company. See Prelim. Decision Memo at 25–26. When calculating Trina's selling, general and administrative ("SG&A") expenses, overhead, and profit, Commerce found that financial statements from three Thai companies—Hana Microelectronics Public Co., Ltd., KCE Electronics Public Company Limited ("KCE"), and Styromatic (Thailand) Co., Ltd. ("Styromatic")—constituted the best available information for deriving surrogate financial ratios. See Prelim. Decision Memo at 26–27. Finally, although Commerce chose Thailand as the primary surrogate country, when valuing Trina's liquid and compressed nitrogen ("nitrogen") FOPs, Commerce relied on Mexican import data—citing concerns that the Thai import data "may not correctly reflect the actual broad market average price for nitrogen in Thailand[.]" Prelim. Surrogate Value Memo. [for 2015–2016 ADD Admin. Review] at 4, PD 364, bar code 3658331-01 (Jan. 2, 2018) ("Prelim. SV Memo"); see also Prelim. Decision Memo at 24 (citing Prelim. SV Memo).

On July 27, 2018, after receiving comments from interested parties, Commerce published its Final Results. See Final Results, 83 Fed. Reg. at 35,616. For the Final Results, as in the Prelim. Results, Commerce declined to increase Trina's U.S. Price to account for the 5.46 percent CVD rate from the companion CVD review. See Prelim. Decision Memo at 30; Final Decision Memo at 17–20; 3^rd CVD AR IDM at Cmts. 1–2. Commerce declined Trina's request to rely on data from Xeneta AS ("Xeneta"), a market research firm in logistics, and continued to rely on Maersk data to calculate freight expenses. See Final Decision Memo at 27–32; see also [Trina's] Surrogate Value Freight Submission at Exs. 1–3, CD 186, bar code 3594073-01 (July 17, 2017) ("Xeneta Freight Data"). Commerce also declined Trina's request to exclude Thai import data with zero quantities when calculating its dumping margin. See Final Decision Memo at 20–22. To derive Trina's surrogate financial ratios, Commerce chose statements from Styromatic and KCE, see Final Decision Memo at 39–49, specifically relying on the unconsolidated version of KCE's statements. See Final Decision Memo at 48. Finally, when valuing Trina's nitrogen FOPs, Commerce continued to use Mexican import data. See Final Decision Memo at 32–38.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to 19 U.S.C. § 1516a(a)(2)(B)(iii) and 28 U.S.C. § 1581(c) (2012), which grant the Court authority to review actions contesting the final determination in an administrative review of an ADD order. The court will uphold Commerce's determination unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law[.]" 19 U.S.C. § 1516a(b)(1)(B)(i).

DISCUSSION

I. ...