Hyundai Heavy Indus. Co. v. United States

393 F.Supp.3d 1293

HYUNDAI HEAVY INDUSTRIES CO., LTD., Plaintiff,andHyosung Corporation, Iljin Electric Co., Ltd., Consolidated Plaintiffs,

v. UNITED STATES, Defendant,andABB Inc., Defendant-Intervenor.

Slip Op. 19-105

Consol. Court No. 18-00066

United States Court of International Trade.

August 5, 2019

David E. Bond, White & Case LLP, of Washington, DC, argued for Plaintiff. With him on the brief were William J. Moran and Ron Kendler.

Henry D. Almond, Arnold & Porter Kaye Scholer LLP, of Washington, DC, argued for Consolidated Plaintiff Hyosung Corporation. With him on the brief were J. David Park, Daniel R. Wilson, and Leslie C. Bailey.

Amrietha Nellan and Jeffrey Winton, Law Office of Jeffrey M. Winton PLLC, of Washington, DC, argued for Consolidated Plaintiff ILJIN Electric Co., Ltd.

John J. Todor, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for Defendant. With him on the brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, L. Misha Preheim, Assistant Director, and Kelly A. Krystyniak, Trial Attorney. Of counsel on the brief was David W. Richardson, Senior Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce.

Melissa M. Brewer, R. Alan Luberda, and David C. Smith, Kelley Drye & Warren LLP, of Washington, DC, argued for Defendant-Intervenor, ABB Inc.

OPINION AND ORDER

Barnett, Judge:

In this action, Plaintiffs Hyundai Heavy Industries Co., Ltd. ("HHI" or "Hyundai"), ¹ Hyosung Corporation ("Hyosung"),² and Iljin Electric Co., Ltd. ("Iljin") contest the U.S. Department of Commerce's ("Commerce" or "the agency") final results of the fourth administrative review ("AR4") of the antidumping duty order on large power transformers ("LPTs") from the Republic of Korea ("Korea"). See Large Power Transformers From the Republic of Korea , 83 Fed. Reg. 11,679 (Dep't Commerce Mar. 16, 2018) (final results of antidumping duty admin. review; 2015-2016) (" Final Results "), ECF No. 19-5, and accompanying Issues and Decision Mem., A-580-867 (Mar. 9, 2018) ("I&D Mem."), ECF No. 19-6.³ In lieu of filing a response brief, Defendant, United States ("the Government"), on behalf of Commerce, filed a motion requesting remand of "this matter in its entirety." Def.'s Mot. for Voluntary Remand at 1, ECF No. 39. Defendant-Intervenor, ABB Inc. ("ABB"), urges the court to sustain the Final Results in their entirety. See Confidential Def.-Int.'s Resp. in Opp'n to Pl.'s and Consol. Pls.' Mots. for J. on the Agency R. ("ABB's Resp."), ECF Nos. 49, 49-1; Order (Jan. 28, 2019), ECF No. 53 (granting ABB's motion for errata).

PROCEDURAL BACKGROUND

On August 5, 2016, Commerce issued a Federal Register notice regarding the opportunity to request an administrative review of the antidumping duty order on LPTs from Korea for the period of review covering August 1, 2015, through July 31, 2016. Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Req. Admin. Review , 81 Fed. Reg. 51,850, 51,851 (Dep't Commerce Aug. 5, 2016), PR 1, CJA Vol. III, Tab 3. On October 14, 2016, Commerce initiated AR4, identifying HHI, Hyosung, and Iljin as companies subject to the review. Initiation of Antidumping and Countervailing Duty Admin. Reviews , 81 Fed. Reg. 71,061, 71,063 (Dep't Commerce Oct. 14, 2016), PR 6, CJA Vol. III, Tab 6. Commerce selected Hyosung and HHI as mandatory respondents for individual review. Respondent Selection Mem. (Jan. 3, 2017) at 5-6, PR 22, CJA Vol. III, Tab 8.

For the preliminary results, Commerce assigned Hyosung and HHI weighted-average dumping margins of 60.81 percent based on the use of total adverse facts available (otherwise referred to as total "AFA"). Large Power Transformers From the Republic of Korea , 82 Fed. Reg. 42,289, 42,290 (Dep't Commerce, Sept. 7, 2017) (prelim. results of antidumping duty admin. review; 2015-2016) ("Prelim. Results "), PR 263, CJA Vol. III, Tab 9.⁴ Because both individually-examined companies were assigned a 60.81 percent margin, Commerce selected this same rate for companies not selected for individual examination (including Iljin). Id. at 42,290 & n.4 (citing Albemarle Corp. v. United States , 821 F.3d 1345 (Fed. Cir. 2016) ).

Commerce made no changes to its determination in the Final Results . Final Results , 83 Fed. Reg. at 11,679 ; I&D Mem. at 3. Commerce based its decision to use total AFA with respect to Hyosung on three collective findings. Commerce found that Hyosung failed to: (1) separately report service-related revenues; (2) explain an invoice that covered multiple sales over multiple review periods; and (3) report all price adjustments and discounts. I&D Mem. at 25-32. Pursuant to 19 U.S.C. § 1677e(a)(2)(A) and (C), Commerce found that Hyosung "withheld information requested by Commerce and otherwise impeded the review," such that the use of "facts otherwise available" was authorized. Id. ; see also 19 U.S.C. § 1677e(a). Additionally, Commerce found that Hyosung "failed to cooperate to the best of its ability" when responding to Commerce's information requests concerning these three issues and applied an adverse inference pursuant to 19 U.S.C. § 1677e(b) when selecting the facts otherwise available. I&D Mem. at 4, 29, 31, 32.

Commerce based its decision to use total AFA with respect to HHI on three other findings. Commerce found that HHI failed to correctly report prices and costs for "accessories," understated the gross unit price for certain home market sales, and failed to disclose an affiliated sales agent. Id. at 9-19. Commerce found that HHI "withheld requested information and otherwise impeded this review," I&D Mem. at 4, such that the use of use of "facts otherwise available" was warranted, id. ; see also 19 U.S.C. § 1677e(a). Commerce determined that HHI also failed to cooperate to the best of its ability when responding to Commerce's information requests on the three identified issues and applied an adverse inference to its selection of the facts otherwise available. I&D Mem. at 4, 14, 18, 19. Commerce did not change the rate assigned to companies not selected for individual examination in the Final Results . Id. at 35.

HHI, Hyosung, and Iljin commenced this action to dispute various aspects of Commerce's Final Results⁵ and ABB intervened as Defendant Intervenor. Order (Apr. 24, 2018), ECF No. 15. Specifically, HHI challenges Commerce's decision to use total AFA to determine HHI's dumping margin, including each of the three bases underlying that decision. See Confidential Rule 56.2 Mot. for J. on the Agency R. on Behalf of Pl. Hyundai Heavy Industries Co., Ltd., ECF No. 29, and Confidential Mem. of P. & A. in Supp. of Pl.'s Rule 56.2 Mot. for J. Upon the Agency R. ("HHI's Br."), ECF No. 29-1; Confidential Reply in Supp. of Pl.'s Rule 56.2 Mot. for J. Upon the Agency R. ("HHI's Reply"), ECF No. 58. Hyosung likewise challenges Commerce's decision to use total AFA to determine Hyosung's dumping margin and each of the three bases upon which Commerce relied to reach that decision. See Hyosung's Br.; Confidential Hyosung's Reply Br. in Supp. of its Rule 56.2 Mot. for J. Upon the Agency R. ("Hyosung's Reply"), ECF No. 55. Iljin challenges Commerce's method of selecting the rate assigned to Iljin. See Mot. of Pl. Iljin Electric Co., Ltd. for J. on the Agency R., ECF No. 24, and Rev. Br. of Iljin Electric Co., Ltd. in Supp. of its Rule 56.2 Mot. for J. on the Agency R. ("Iljin's Br."), ECF No. 25; Reply Br. of Iljin Electric Co., Ltd. ("Iljin's Reply") at 2, ECF No. 54.⁶

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to § 516A(a)(2)(B)(iii) of the Tariff Act of 1930,⁷ as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2012), and 28 U.S.C. § 1581(c). The court will uphold an agency determination that is supported by substantial evidence and otherwise in accordance with law. 19 U.S.C. § 1516a(b)(1)(B)(i).

DISCUSSION

I. The Government's Motion for Remand

A. Legal Framework

When an agency determination is challenged in the courts, the agency may "request a remand (without confessing error) in order to reconsider its previous position" and "the reviewing court has discretion over whether to remand." SKF USA Inc. v. United States , 254 F.3d 1022, 1029 (Fed. Cir. 2001) (citations omitted). Remand is appropriate "if the agency's concern is substantial and legitimate," but "may be refused if the agency's request is frivolous or in bad faith." Id. "A concern is substantial and legitimate when (1) Commerce has a compelling justification, (2) the need for finality does not outweigh that justification, and (3) the scope of the request is appropriate." Changzhou Hawd Flooring Co., Ltd. v. United States , 38 CIT ––––, ––––, 6 F. Supp. 3d 1358, 1361 (2014) (citations omitted).

B. Parties' Contentions

The Government requests a remand of "this matter in its entirety" to Commerce, Def.'s Mot. for Voluntary Remand at 1, so that the agency may "reconsider or further explain" its decisions to use total AFA with respect to HHI and Hyosung and its decision to assign Iljin "the average rate of the two mandatory respondents," id. 4. The Government provides two justifications for the remand request. It states that Commerce's findings with respect to HHI's reporting of accessories overlap with the court's recent remand order in Hyundai Heavy Industries, Co. Ltd. v. United States , 42 CIT ––––, 332 F. Supp. 3d 1331 (2018).⁸ Id. at 4. Additionally, it contends, Commerce's findings with respect to Hyosung's alleged failure separately to report service-related revenues overlaps with the court's recent remand order regarding HHI's reporting of service-related revenue in ABB Inc. v. United States ("ABB II") , 42 CIT ––––, 355 F. Supp. 3d 1206 (2018), reconsideration denied , 43 CIT ––––, 375 F. Supp. 3d 1348 (2019).⁹ Id.

HHI and Hyosung oppose the Government's remand request, arguing that it does not encompass...