Fine Furniture (Shanghai) Ltd. v. United States

353 F.Supp.3d 1323

FINE FURNITURE (SHANGHAI) LIMITED, et al., Plaintiffs,andArmstrong Wood Products (Kunshan) Co., Ltd., Guangdong Yihua Timber Industry Co., Ltd., Old Master Products, Inc., Lumber Liquidators Services, LLC, Shanghai Lairunde Wood Co., Ltd., Changzhou Hawd Flooring Co., Ltd., Dalian Huilong Wooden Products Co., Ltd., Dunhua City Jisen Wood Industry Co., Ltd., Dunhua City Dexin Wood Industry Co., Ltd., Dunhua City Hongyuan Wood Industry Co., Ltd., Jiaxing Hengtong Wood Co., Ltd., Karly Wood Product Limited, Yingyi-Nature (Kunshan) Wood Industry Co., Ltd., Xiamen Yung De Ornament Co., Ltd., Zhejiang Shuimojiangnan New Material Technology Co., Ltd., Plaintiff-Intervenors,

v.UNITED STATES, Defendant.

Slip Op. 18–163

Consol. Court No. 16-00145

United States Court of International Trade.

November 26, 2018

Sarah M. Wyss, Mowry & Grimson, PLLC, of Washington DC, argued for plaintiff. With her on the brief were Kristin H. Mowry, Jeffrey S. Grimson, Jill A. Cramer, Yuzhe PengLing, and James C. Beaty.

Gregory S. Menegaz, J. Kevin Horgan, Alexandra H. Salzman, and Judith L. Holdsworth, of deKieffer & Horgan, PLLC, of Washington DC, for consolidated plaintiffs Changzhou Hawd Flooring Co., Ltd., Dalian Huilong Wooden Products Co. Ltd., Dunhua City Jisen Wood Industry Co., Ltd., Dunhua City Dexin Wood Industry Co., Ltd., Dunhua City Hongyuan Wood Industry Co., Ltd., Jiaxing Hengtong Wood Co., Ltd., Karly Wood Product Limited, Yingyi-Nature (Kunshan) Wood Industry Co., Ltd., Xiamen Yung De Ornament Co., Ltd., and Zhejiang Shuimojiangnan New Material Technology Co., Ltd.

Lizbeth R. Levinson, Ronald M. Wisla and Brittney R. McClain, Kutak Rock LLP, of Washington DC, for consolidated plaintiffs Zhejiang Dadongwu GreenHome Wood Co., Ltd., Johnson's Premium Hardwood Flooring, Inc., Struxtur, Inc., Wego Chemical & Mineral Corp., Floor and Décor Outlets of America, Inc., Hangzhou Hanje Tec Co., Ltd., Huzhou Chenghang Wood Co., Ltd., Jilin Forest Industry Jinqiao Flooring Group Co., Ltd., MuDanJiang Bosen Wood Industry Co., Ltd., Nakahiro Jyou Sei Furniture (Dalian) Co., Ltd., Shenyang Haobainian Wooden Co., Ltd., Dalian Dajen Wood Co., Ltd., and Dunhua City Wanrong Wood Industry Co., Ltd.

Francis J. Sailer and Andrew T. Schutz, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, of Washington DC, for plaintiff-intervenor Shanghai Lairunde Wood Co., Ltd.

John R. Magnus and Sheridan S. McKinney, TradeWins LLC, of Washington DC, for plaintiff-intervenor Old Master Products, Inc.

H. Deen Kaplan and Craig A. Lewis, Hogan Lovells US LLP, of Washington, DC, for plaintiff-intervenor Armstrong Wood Products (Kunshan) Co. Ltd.

Mark Ludwikowski, Kristen Smith, Arthur K. Purcell, and Emi Ito Ortiz, Sandler, Travis & Rosenberg, P.A., of Washington DC, for plaintiff-intervenor Lumber Liquidators Services, LLC.

Jonathan M. Zielinski and Thomas M. Beline, Cassidy Levy Kent (USA) LLP, of Washington DC, for plaintiff-intervenor Guangdong Yihua Timber Industry Co., Ltd.

Tara K. Hogan, Senior Trial Counsel, U.S. Department of Justice, Commercial Litigation Branch, of Washington DC, argued for defendant. With her on the brief were Chad A. Readler, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Claudia Burke, Assistant Director. Of Counsel on the brief was Mercedes C. Morno, Office of Trade Enforcement & Compliance, U.S. Department of Commerce.

OPINION

Eaton, Judge:

In this consolidated action, plaintiff Fine Furniture (Shanghai) Limited ("Fine Furniture" or "plaintiff") moves for judgment on the agency record, challenging the United States Department of Commerce's ("Commerce" or "Department") final results in the third administrative review of the antidumping duty order on multilayered wood flooring from the People's Republic of China. See Multilayered Wood Flooring From the People's Rep. of China , 81 Fed. Reg. 46,899 (Dep't Commerce July 19, 2016), as amended 81 Fed. Reg. 53,120 (Dep't Commerce Aug. 11, 2016) ("Final Results"); see also Final Issues & Dec. Mem. (July 12, 2016) ("Final IDM") (P.R. 359-361). Fine Furniture, consolidated plaintiffs,¹ and plaintiff-intervenors² (collectively, "plaintiffs") contend that Commerce's Final Results were unsupported by substantial evidence on the record. See Fine Furniture's Mem. Supp. Mot. J. Agency R., ECF No. 90-1 ("Fine Furniture Br.").

Plaintiffs are producers and/or exporters of multilayered wood flooring from China. By their motions for judgment on the agency record, plaintiff and plaintiff-intervenors challenge Commerce's (1) selection of Romania as the primary surrogate country, (2) calculation of the surrogate financial ratios, and (3) calculation of the surrogate value for Fine Furniture's face veneer. See generally Fine Furniture Br.³ Plaintiff-Intervenor Old Master also challenges Commerce's (4) calculation of the antidumping duty margin assigned to the separate rate companies who were not selected for individual examination. See Old Master's Mem. Supp. Mot. J. Agency R., ECF No. 92-1 ("Old Master Br.").⁴

Defendant the United States, on behalf of Commerce, maintains that the Final Results should be sustained because they are in accordance with law and supported by substantial evidence. See Def.'s Resp. Opp'n Mots. J. Admin. R., ECF No. 101 ("Def.'s Br.").

The court has jurisdiction under 28 U.S.C. § 1581(c) (2012). For the reasons stated below, the court sustains Commerce's Final Results.

BACKGROUND

On October 18, 2011, Commerce published its final affirmative dumping determination and an antidumping duty order on multilayered wood flooring from China. See Multilayered Wood Flooring From the People's Rep. of China , 76 Fed. Reg. 64,318 (Dep't Commerce Oct. 18, 2011). The order was amended twice and remains in effect. See Multilayered Wood Flooring From the People's Rep. of China , 76 Fed. Reg. 76,690 (Dep't Commerce Dec. 8, 2011) (amended final dumping determination and order); Multilayered Wood Flooring From the People's Rep. of China , 77 Fed. Reg. 5484 (Dep't Commerce Feb. 3, 2012)(amended antidumping and countervailing duty orders).

On February 4, 2015, Commerce initiated its third administrative review of the order covering the period of December 1, 2013, through November 30, 2014 ("POR"). See Initiation of Antidumping and Countervailing Duty Admin. Reviews, 80 Fed. Reg. 6041 (Dep't Commerce Feb. 4, 2015). Fine Furniture and Dalian Penghong Floor Products Co., Ltd. ("Penghong") were selected as mandatory respondents. See Final Results, 81 Fed. Reg. at 46,899. Because China is considered a nonmarket economy, Commerce was required to select a surrogate market economy country to value the factors of production of the subject imports.⁵

As part of its review, on May 15, 2015, Commerce's Import Administration Office of Policy issued a non-exhaustive list of countries at the same or comparable level of economic development as China based on per capita gross national income as reported in the World Bank's 2015 Development Report (the "OP list"). This list included Romania, Bulgaria, South Africa, Ecuador, Thailand, and Ukraine.⁶ Commerce then set a deadline of June 15, 2015, for comments on surrogate country selection regarding the listed countries' (1) significant production of comparable merchandise, (2) data availability and quality, to value factors of production, and (3) financial statements availability and quality (i.e. , whether the countries were acceptable as surrogate countries or to propose other economically comparable countries); and a deadline of June 29, 2015, to submit proposed surrogate values.⁷ See Letter to All Interested Parties Re: Request for Surrogate Country and Surrogate Value Comments and Information (May 15, 2015) (P.R. 169).

In its initial response, filed on June 15, 2015, petitioner Coalition for American Hardwood Parity ("petitioner")⁸ stated that the six potential surrogate countries on Commerce's OP list were (1) significant producers of comparable merchandise and (2) that data of reasonable availability and quality, for the factors of production, and financial statements were available (i.e. , that all six countries met the requirements for use as the primary surrogate country), but because "one of the mandatory respondents [Fine Furniture] ... was not due for submission to the Department until June 12, 2016," and therefore petitioner "d[id] not know the specific factors of production for that respondent," petitioner did not make any arguments as to which country was the most appropriate surrogate country. See Pet. Comments on Surrogate Selection (P.R. 185) at 3. In fact, on June 15, 2015, Fine Furniture timely submitted a letter arguing that Thailand should serve as the surrogate country. See Fine Furniture's Surrogate Country Comments (June 15, 2015) (P.R. 186) at 2.

Thereafter, on June 29, 2015, petitioner submitted proposed surrogate values from Romania and, for the first time, argued that Romania was the most appropriate surrogate country. See Letter from Levin Trade Law, P.C. to Commerce (June 26, 2015) (P.R. 190-192). On November 20, 2015, Commerce rejected a portion of this submission because it contained "untimely filed comments on surrogate country selection" (which were due by June 15, 2015), but allowed petitioner to resubmit the document without those comments. See Letter from Commerce to Levin Trade Law, P.C. (Nov. 20, 2015) (P.R. 279). Petitioner resubmitted the document with the necessary adjustments on November 24, 2015. See Letter from Levin Trade Law, P.C. to Commerce (Nov. 24, 2015) (P.R. 281-282).

Also, on November 2, 2015, petitioner submitted additional proposed surrogate values and commented that "these suggestions demonstrate the superiority of Romania as a surrogate country versus Thailand." Letter from Levin Trade Law, P.C. to Commerce (Nov. 2, 2015) (P.R. 254) at 2. On November 5, 2015, Commerce held an ex parte meeting with petitioner regarding the selection of the appropriate surrogate country. See Memo to File...