Hyundai Heavy Indus. Co. v. United States

485 F.Supp.3d 1380

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

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

Slip Op. 20-165

Consol. Court No. 18-00066

United States Court of International Trade.

November 18, 2020

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

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

Amrietha Nellan and Jeffrey M. Winton, Winton & Chapman PLLC, of Washington, DC, argued for Consolidated Plaintiff ILJIN Electric Co., Ltd. With them on brief was Vi N. Mai.

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

Melissa M. Brewer and David C. Smith, Kelley Drye & Warren LLP, of Washington, DC, argued for Defendant-Intervenor ABB Enterprise Software Inc. With them on the brief was R. Alan Luberda.

OPINION AND ORDER

Barnett, Judge:

This matter is before the court following the U.S. Department of Commerce's ("Commerce" or "the agency") remand redetermination of the final results of the fourth administrative review ("AR4") of the antidumping duty order on large power transformers ("LPTs") from the Republic of Korea for the period of review ("POR") August 1, 2015, to July 31, 2016.¹ See Final Results of Remand Redetermination Pursuant to Court Remand ("Remand Results"), ECF No. 91-1; see generally Hyundai Heavy Indus. v. United States ("HHI (AR4) I "), 43 CIT ––––, 393 F. Supp. 3d 1293 (2019) ; Large Power Transformers From the Republic of Korea , 83 Fed. Reg. 11,679 (Dep't Commerce Mar. 6, 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.

On October 14, 2016, Commerce initiated this fourth administrative review. See 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 ("Initiation Notice "). Commerce limited its examination to Plaintiff Hyundai Heavy Industries Co., Ltd. ("HHI")² and Consolidated Plaintiff Hyosung Corporation ("Hyosung"). See Respondent Selection Mem. (Jan. 3, 2017) ("Selection Mem.") at 6, PR 22, CJA (Vol. III) Tab 8. Consolidated Plaintiff ILJIN Electric Co., Ltd. ("Iljin") was one of the non-individually examined respondents. See Initiation Notice , 81 Fed. Reg. at 71,063 ; Selection Mem. at 6.

For the Final Results , Commerce assigned Hyosung and HHI weighted-average dumping margins of 60.81 percent based on total adverse facts available (or "total AFA"). 83 Fed. Reg. at 11,680.³ Commerce assigned the same rate to the non-individually examined respondents (including Iljin). See I&D Mem. at 3.

Hyosung, HHI, and Iljin each filed motions for judgment on the agency record challenging different aspects of Commerce's decision. See HHI (AR4) I , 393 F. Supp. 3d at 1299–1300. The Government, on behalf of Commerce, moved to remand the matter in its entirety. Id. at 1298. The court denied the Government's motion, id. at 1301–02, and remanded the Final Results for reconsideration or further explanation regarding Commerce's reliance on total AFA for both Hyosung and HHI, id. at 1310–12, 1318–20. Relevant to this discussion, with respect to Hyosung, the court was not able to discern Commerce's reasoning for finding that a certain invoice series covering multiple sales across multiple review periods was unreliable, id. at 1308–10, and held that the agency failed to support adequately its finding that Hyosung's reporting of certain price adjustments and discounts was grounds for total AFA, id. at 1310–12.

With respect to HHI, the court found that substantial evidence did not support the agency's reliance on total AFA based on HHI's reporting of accessories. See id. at 1313–17. The court also found that while substantial evidence supported Commerce's finding that the record was ambiguous regarding whether HHI reliably and accurately reported home market gross unit prices, the court directed Commerce to revisit this issue on remand because it appeared to be related to the accessories issue. Id. at 1317–18. The court deferred ruling on Iljin's motion because the issues raised therein could become moot on remand. Id. at 1321.

On remand, with respect to Hyosung, Commerce continued to rely on total AFA based on Hyosung's failure to report reliably price adjustments associated with U.S. sales. Remand Results at 11–15. However, the agency found that Hyosung's overlapping invoice series was not grounds for total AFA. See id. at 45–50. With respect to HHI, Commerce determined that HHI had inconsistently reported certain parts as foreign like product in reporting the gross-unit prices of home market sales. Id. at 16–18. Thus, the agency found HHI's home market sales database was unreliable, warranting reliance on total AFA. Id. at 18–19. Finally, Commerce continued to assign Iljin an all-others rate based on the average of the AFA margins of the individually examined respondents. Id. at 24.

Hyosung and HHI each filed comments challenging Commerce's reliance on total AFA to determine each of their margins. See Hyosung's Cmts. on Final Reman Results ("Hyosung Opp'n Cmts."), ECF No. 100; Confidential Pl.’s Cmts. in Opp'n to the Final Results of Redetermination Pursuant to Court Remand ("HHI Opp'n Cmts."), ECF No. 103. Defendant-Intervenor ABB Enterprise Software Inc. ("ABB") filed comments supporting Commerce's reliance on total AFA for Hyosung and HHI. See Confidential Def.-Int. ABB's Cmts. in Supp. of Remand Redetermination ("ABB Supp. Cmts."), ECF No. 121. Iljin filed comments arguing that Commerce may not determine the all-others rate by averaging the rates of individually examined respondents when each of which was determined using total AFA. See Cmts. of [Iljin] ("Iljin Opp'n Cmts."), ECF No. 97. Iljin subsequently filed a motion to supplement its comments with a brief addressing additional authority. See Mot. of Pl. [Iljin] for Leave of Court to File Suppl. Br. and accompanying proposed Suppl. Br., ECF No. 139.

ABB filed comments contending that substantial evidence does not support Commerce's finding that Hyosung's overlapping invoice series was reliable and challenging Commerce's findings that HHI had reliably reported information concerning service-related revenue, spare parts, and cost of production. See Confidential ABB's Cmts. in Opp'n to Remand Results ("ABB Opp'n Cmts."), ECF No. 101. In response, Hyosung and HHI filed comments supporting Commerce's Remand Results with respect to these issues. See Confidential Hyosung's Cmts. in Supp. of Final Remand Results Regarding Overlapping Invoice Issue ("Hyosung Supp. Cmts."), ECF No. 116; Confidential Pl.’s Am. Responsive Cmts. in Supp. of the Final Results of Redetermination Pursuant to Court Remand ("HHI Supp. Cmts."), ECF No. 129.

The Government filed comments in support of the Remand Results. Confidential Def.’s Resp. to Cmts. on Remand Redetermination ("Gov't Resp."), ECF No. 114.

For the reasons discussed below, Commerce's Remand Results are remanded to Commerce to clarify or reconsider its decision not to issue a supplemental questionnaire to Hyosung and its reliance on total AFA for HHI. Because Commerce may choose not to rely on total AFA for Hyosung and/or HHI on remand, the court defers ruling on Iljin's arguments and denies Iljin's Motion to file a Supplemental Brief as moot. The agency's Remand Results are otherwise sustained.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2018),⁴ and 28 U.S.C. § 1581(c) (2018). 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). "The results of a redetermination pursuant to court remand are also reviewed for compliance with the court's remand order." Solar World Ams., Inc. v. United States , 41 CIT ––––, ––––, 273 F. Supp. 3d 1314, 1317 (2017) (quoting Xinjiamei Furniture (Zhangzhou) Co. v. United States , 38 CIT ––––, ––––, 968 F. Supp. 2d 1255, 1259 (2014) ).

DISCUSSION

I. Legal Framework

When necessary information is not available on the record, or an interested party withholds information requested by Commerce, fails to provide requested information by the submission deadline, significantly impedes a proceeding, or provides information that cannot be verified pursuant to 19 U.S.C. § 1677m(i), Commerce "shall ... use the facts otherwise available." 19 U.S.C. § 1677e(a). Commerce's authority to use the facts otherwise available is subject to 19 U.S.C. § 1677m(d) and (e). Id. Pursuant to section 1677m(d), if Commerce determines that a respondent has not complied with a request for information, it must promptly inform that respondent of the nature of the deficiency and, to the extent practicable in light of statutory deadlines, provide "an opportunity to remedy or explain the deficiency." Pursuant to subsection (e), Commerce "shall not decline to consider information that is submitted by an interested party" and that satisfies the following requirements:

(1) the information is submitted by the deadline established for its submission,

(2

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