Dongguan Sunrise Furniture Co. v. United States

865 F.Supp.2d 1216

DONGGUAN SUNRISE FURNITURE CO., LTD., Taicang Sunrise Wood Industry Co., Ltd., Taicang Fairmont Designs Furniture Co., Ltd., and Meizhou Sunrise Furniture Co., Ltd., Plaintiffs,Longrange Furniture Co., Ltd., Consolidated Plaintiff,Coaster Company of America, COE Ltd., Langfang Tiancheng Furniture Co., Ltd., and Trade Masters of Texas, Inc., Intervenor Plaintiffs,

v. UNITED STATES, Defendant,American Furniture Manufacturers Committee for Legal Trade, and Vaughan–Bassett Furniture Company, Inc., Intervenor Defendants.

United States Court of International Trade.

Slip Op. 12–79.

Court No. 10–00254.

June 6, 2012.

Recognized as Invalid

19 C.F.R. § 351.408(c)(3).

Peter J. Koenig, Squire, Sanders & Dempsey, LLP, of Washington, DC, argued for plaintiffs. With him on the brief was Christine Juliet Sohar Henter.

Sarah M. Wyss, Mowry & Grimson, PLLC, of Washington, DC, argued for intervenor plaintiffs. With her on the brief were Susan L. Brooks, Jill A. Cramer, Jeffrey S. Grimson, Keith F. Huffman, and Kristin H. Mowry.

Lizbeth R. Levinson and Ronald M. Wisla, Kutak Rock LLP, of Washington, DC, represented consolidated plaintiff.¹

Stephen C. Tosini, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With him on the brief were Stuart F. Delery, Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel on the brief was Rebecca Cantu, Attorney, Office of the Chief Counsel for Import Administration, Department of Commerce, of Washington, DC.

J. Michael Taylor and Daniel L. Schneiderman, King & Spalding, LLP, of Washington, DC, argued for intervenor defendants. With them on the brief were Joseph W. Dorn and Mark T. Wasden.

OPINION AND ORDER

RESTANI, Judge:

This action challenges the Department of Commerce's (“Commerce”) final results rendered in the fourth antidumping (“AD”) duty review of certain wooden bedroom furniture (“WBF”) from the People's Republic of China (“PRC”). See Wooden Bedroom Furniture From the People's Republic of China: Final Results and Final Rescission in Part, 75 Fed.Reg. 50,992, 50,992 (Dep't Commerce Aug. 18, 2010) (“ Final Results ”). Plaintiffs Dongguan Sunrise Furniture Co., Ltd., Taicang Sunrise Wood Industry Co., Ltd., Taicang Fairmont Designs Furniture Co., Ltd., and Meizhou Sunrise Furniture Co., Ltd. (collectively “Fairmont”) moved for judgment on the agency record. See Mem. of Points and Auths. in Support of Rule 56.2 Mot. for J. Upon the Agency R. by Pl. Fairmont Designs et al. (“Fairmont Br.”). Intervenor Plaintiffs Coaster Company of America, COE Ltd., Langfang Taincheng Furniture Co., Ltd. and Trade Masters of Texas, Inc. (collectively “Coaster”) moved for judgment on the agency record.² Mot. for J. Upon the Agency R. Pursuant to Rule 56.2 by Consolidated Pls. Coaster Co. of Am., COE Ltd., Langfang Tiancheng Furniture Co., Ltd. and Trade Masters of Texas, Inc. (“Coaster Br.”). Intervenor Defendants American Furniture Manufacturers Committee for Legal Trade and Vaughan–Bassett Furniture Company, Inc., (“AFMC”) also moved for judgment on the agency record. The AFMC's Rule 56.2 Brief in Support of its Mot. for J. on the Agency R. (“AFMC Br.”). For the reasons stated below, the court remands in part and sustains in part the Final Results. The Government's request for a remand on the issue or zeroing is granted.³See Def.'s Resp. to Pls.' Rule 56.2 Mots. (“Def.'s Br.”).

BACKGROUND

In January 2005, Commerce published an AD duty order on WBF from the PRC. Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Wooden Bedroom Furniture From the People's Republic of China, 70 Fed.Reg. 329, 329 (Dep't Commerce Jan. 4, 2005). In January 2009, AFMC and others requested an administrative review of certain companies exporting WBF to the United States between January 1, 2008 and December 31, 2008, thereby triggering the fourth administrative review of WBF.⁴Wooden Bedroom Furniture From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review and Intent To Rescind Review in Part, 75 Fed.Reg. 5952, 5952–53 (Dep't Commerce Feb. 5, 2010) (“ Preliminary Results ”). After publishing a notice of initiation and receiving questionnaire responses and comments, Commerce selected three mandatory respondents: Dalian Huafeng Furniture Co., Ltd. (“Huafeng”), Guangdong Yihua Timber Industry Co., Ltd. (“Yihua”), and Shanghai Aosen Furniture Co., Ltd. (“Aosen”). Preliminary Results, 75 Fed.Reg. at 5953.

On April 20 and 21, 2009, Commerce issued the antidumping questionnaire to the three mandatory respondents and made it available to voluntary respondents, including Fairmont. Id. During April and May 2009, AFMC and all other interested parties withdrew their request for review for two of the mandatory respondents, Huafeng and Yihua, and several other companies. Id. As a result, Commerce named Fairmont as an additional mandatory respondent on May 29, 2009. Id. Aosen withdrew from participation in the review, leaving Fairmont as the only cooperating mandatory respondent. Id. Fairmont responded to Commerce's questionnaires and supplemental questionnaires between April 2009 and January 2010. Id.; Fairmont Br. 44 n. 155. In October and November 2009, Commerce verified Fairmont's responses and found that Fairmont had failed to report sales of more than twenty in-scope product models. Id. at 5954; Preliminary Analysis Memorandum (Feb. 1, 2010), C.R. 356 at 30–32.

In the February 2010 Preliminary Results, Commerce calculated the wage rate using the now invalidated regression based methodology. Preliminary Results, 75 Fed.Reg. at 5962;see19 C.F.R. § 351.408(c)(3), abrogated by Dorbest Ltd. v. United States, 604 F.3d 1363, 1377 (Fed.Cir.2010) (“Dorbest IV ”). In response to Dorbest IV, Commerce, in this proceeding, placed additional labor data on the record and requested comments from interested parties. Labor Wage Rate (July 14, 2010), P.R. 916 at 1. AFMC, Coaster, and Fairmont submitted timely comments. See P.R. 919, 920, 921, 925, 926.

In the Final Results, Commerce revised the surrogate wage rate, the brokerage and handling surrogate value, and used the financial statements of various Philippine companies to calculate surrogate values. Final Results, 75 Fed.Reg. at 50,993–94; Issues and Decision Memorandum for the Final Results of the Administrative Review of the Antidumping Duty Order on Wooden Bedroom Furniture from the People's Republic of China, A–570–890, POR 1/1/08–12/31/08, at 72 (Aug. 11, 2010) (“ Issues and Decision Memorandum ”), available at http:// ia. ita. doc. gov/ frn/ summary/ PRC/ 2010– 20499– 1. pdf (last visited June 5, 2012). Commerce assigned Fairmont a separate rate of 43.23%, which included the rate of 216.01% applicable to the PRC-wide entity for the unreported sales as adverse facts available (“AFA”). Final Results, 75 Fed.Reg. at 50,998.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to 28 U.S.C. § 1581(c). The court will not uphold Commerce's final determination in an AD review if 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. Partial Adverse Facts Available

Fairmont argues its partial AFA rate is contrary to law because six products are not subject merchandise, Fairmont acted to the best of its ability, and the AFA rate applied is aberrational and not a reasonably accurate estimate of Fairmont's actual dumping margin. Fairmont Br. 36–58.

A. Subject merchandise

Fairmont argues that six of the twenty-three products are not subject merchandise and thus, Commerce never requested information relating to these products and the information cannot be considered missing from the record. ⁵ Fairmont Br. 36–43. Fairmont's argument lacks merit.

Commerce may use facts otherwise available if “an interested party ... withholds information that has been requested by the administering authority or the Commission under this subtitle....” 19 U.S.C. § 1677e(a)(2). Commerce's Section C Questionnaire requested Fairmont to report sales data for all of its subject merchandise. Questionnaire Resp. (June 15, 2009), Confidential App. to Def.'s Resp. to Pls. Rule 56.2 Mots. (“Def.'s Confidential App.”) Tab 2 at 2. Thus, whether Fairmont withheld or failed to provide requested information relating to these six products depends on whether the products are subject merchandise.

1. The dresser and custom cabinet products

Fairmont argues the dresser and custom cabinet products ⁶ are not subject merchandise because they are multifunction combination units designed for the living room of a hotel suite. Fairmont Br. 37, 40. Fairmont does not dispute that the dresser products contain a dresser, but argues the products are not subject merchandise because the dresser and custom cabinets are combined with a minibar and a TV panel and such combination units are not included in the scope language. Id. at 37–40.

Commerce found the products were subject merchandise because the customer expectations, end-uses, and manner of display were consistent with WBF. Issues and Decision Memorandum for the Final Results of the Administrative Review of the Antidumping Duty Order on Wooden Bedroom Furniture from the People's Republic of China: Whether Certain Unreported Sales Determined to be Subject Merchandise in the Preliminary Results are Subject Merchandise, A–570–890, POR: 1/1/08–12/31/08, at 4–5 (Aug. 11, 2010), C.R. 388 (“ Confidential Issues and Decision Memorandum ”). Commerce relied on the products' size, functionality, Fairmont's descriptions of the products, Fairmont's invoices, photographs of the products in hotel suites, and the fact that a hotel was the exclusive purchaser of the products. Id. Commerce also relied on the scope definition relating to combination units, and...