Prime Time Commerce LLC v. United States

495 F.Supp.3d 1308

PRIME TIME COMMERCE LLC, Plaintiff,

v.UNITED STATES, Defendant.

Slip Op. 21-5

Court No. 18-00024

United States Court of International Trade.

January 19, 2021

Mark B. Lehnardt and Lindita V. Ciko Torza Baker & Hostetler, LLP, of Washington, DC, for plaintiff.

Ashley Akers, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for defendant. Also on the brief was Patricia M. McCarthy, Assistant Director, Jeanne E. Davidson, Director, and Joseph H. Hunt, Assistant Attorney General. Of Counsel on the brief was Brendan Saslow, Attorney, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC.

OPINION AND ORDER

Kelly, Judge:

Before the court is the U.S. Department of Commerce's ("Commerce") remand redetermination pursuant to the court's order in Prime Time Commerce LLC v. United States, 43 CIT ––––, ––––, 396 F. Supp. 3d 1319, 1334 (2019) (" Prime Time I"). See also Final Results of Redetermination Pursuant to Ct. Remand Order in [Prime Time I ] Confidential Version, Oct. 7, 2019, ECF No. 39-1 ("Remand Results"). In Prime Time I, the court remanded in part Commerce's final determination in the 2015–2016 administrative review of the antidumping duty ("ADD") order covering certain cased pencils from the People's Republic of China ("PRC"). See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1334. The court ruled that Commerce's decision rejecting Prime Time's factual submissions was contrary to law. See id. at 1326–29, 1334. The court instructed Commerce to place Prime Time's submission on the record, review it, and determine whether the information would allow Commerce to calculate an importer-specific rate. See id. at 1326–29. Further, the court ruled that Commerce's refusal to calculate an importer-specific assessment rate was unsupported by substantial evidence. See id. 1329–32. On remand, Commerce reconsiders its rejection of Prime Time's factual submission, but nonetheless concludes that it cannot calculate an importer-specific assessment rate for Prime Time. See Remand Results at 3–16. For the following reasons, the court sustains Commerce's remand redetermination.

BACKGROUND

The court presumes familiarity with the facts of this case, as set out in its previous remand order, and now recounts the facts relevant to disposition of this action. See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1323–25. In response to timely requests, Commerce initiated its 2015–2016 administrative review of the ADD order covering certain cased pencils from the PRC. See Initiation of Antidumping and Countervailing Duty Admin. Reviews, 82 Fed. Reg. 10,457, 10,458 –59 (Dep't Commerce Feb. 13, 2017) ("Initiation Notice"). Pertinent here, Commerce selected Ningbo Homey Union Co., Ltd. ("Homey") as the sole mandatory respondent for individual examination.¹ See Resp't Selection Memo. at 1, PD 23, bar code 3558523-01 (Mar. 31, 2017) ("Resp't Selection Memo").²

Since Commerce considers the PRC to be a non-market economy ("NME"), unless a respondent demonstrates otherwise, Commerce presumes that all companies within the PRC are subject to government-control and should be assigned a single "country-wide" rate. See, e.g., Import Admin., [Commerce], Separate-Rates Practice and Application of Combination Rates in Antidumping Investigations involving [NME] Countries, Policy Bulletin 05.1 at 1 (Apr. 5, 2005) ("Policy Bulletin 05.1") (citations omitted), available at http://enforcement.trade.gov/policy/bull05-1.pdf (last visited Jan. 12, 2021). Although Homey initially sought to demonstrate its independence from the country-wide entity by timely submitting a separate rate application, it later stopped cooperating with Commerce's requests for information. See Certain Cased Pencils From the [PRC], 82 Fed. Reg. 43,329, 43,330 (Dep't Commerce Sept. 15, 2017) (preliminary results of [ADD] admin. review, prelim. determination of no shipments, & rescission of review, in part; 2015–2016) ("Prelim. Results") and accompanying Decision Memo for [the Prelim. Results ] at 2, A-570-827, PD 63, bar code 3614317-01 (Aug. 31, 2017) ("Prelim. Decision Memo"). Namely, Homey did not respond to Commerce's AD questionnaire. See Prelim. Decision Memo at 2.

Prime Time, an unaffiliated importer of Homey's exports, sought to file Sections C&D Questionnaire responses on behalf of Homey. See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1323 ; see also [Prime Time's] Req. Reconsideration at 2, PD 60, bar code 3604262-01 (Aug. 3, 2017).³ Commerce found that Prime Time's questionnaire response constituted unsolicited factual information, rejected Prime Time's submission along with Prime Time's accompanying narrative of admissibility, and removed all filings associated with Prime Time's submission from the record. See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1323–24. For its preliminary and final determinations, Commerce concluded that Homey failed to meet the prerequisites for separate rate eligibility, and further concluded that it could not calculate an importer-specific assessment rate for Prime Time. See Prelim. Decision Memo at 6; Certain Cased Pencils From the [PRC], 83 Fed. Reg. 3,112, 3,112 (Dep't Commerce Jan. 23, 2018) (final results of [ADD] administrative review; 2015–2016) ("Final Results") and accompanying Issues & Decision Memo: Certain Cased Pencil's from the [PRC]; 2015–2016 at 4–5, 6–7, A-570-827, (Jan. 16, 2018), ECF No. 12-4 ("Final Decision Memo"). Commerce assigned the PRC-wide assessment rate of 114.90% to Homey's exports of subject merchandise during the period of review. See Final Results, 83 Fed. Reg. at 3,113.

On July 19, 2019, the court remanded aspects of Commerce's final determination for further explanation or reconsideration. See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1326–34. Prime Time I held that, to the extent that Prime Time's submission was offered as factual information not elsewhere defined pursuant to 19 C.F.R. § 301.301(c)(5) (2017),⁴ Commerce acted contrary to law by removing Prime Time's submission and accompanying narrative of admissibility from the record because Commerce's regulations establish that only unsolicited questionnaire responses and untimely information will be removed from the record. See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1326–29, 1334 ; see also 19 C.F.R. § 351.104(a)(2)(iii).⁵ The court also held that Commerce's attempt to justify its refusal to calculate an importer-specific assessment rate based on agency practice was unsupported by substantial evidence, because Commerce did not explain why its practice is reasonable in light of its own regulation directing the calculation of such a rate. See Prime Time I, 43 CIT at ––––, 396 F. Supp. 3d at 1329–32.

On remand, Commerce accepts Prime Time's submission and evaluates it in light of Prime Time's request that Commerce calculate an importer-specific rate. See Remand Results at 1–16. However, Commerce continues to determine that it cannot calculate an importer-specific assessment rate for Prime Time. See id. Commerce instead explains why its practice of calculating an importer-specific assessment rate only when it calculates a margin for an individually-examined exporter is reasonable, even in light of its regulation directing the calculation of an importer-specific rate. See id. at 5–8. Moreover, Commerce explains why it can neither calculate an exporter rate for Homey using Prime Time's factual submission, see Final Decision Memo at 4–5, nor can it calculate an assessment rate for Prime Time using the PRC-wide entity rate or Prime Time's factual submission. See Remand Results at 5–8.

Commerce received no comments on the draft results of its remand analysis. See id. at 2. Only after Commerce's final remand redetermination did Prime Time submit comments before this court challenging Commerce's continued refusal to calculate an importer-specific assessment rate. See Pl. [Prime Time]’s Cmts. on Remand Redetermination Confidential Version, Nov. 6, 2019, ECF No. 42 ("Prime Time's Br."). On December 6, 2019, briefing on Commerce's remand redetermination concluded. See Def.’s Reply to Cmts. on Remand Results, Dec. 6, 2019, ECF No. 44 ("Def.’s Reply Br."). On November 5, 2020, the court heard oral argument. See Oral Arg., Nov. 5, 2020, ECF No. 55 ("Oral Arg.").

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) (2012),⁶ and 28 U.S.C. § 1581(c) (2012),⁷ 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). "The results of a redetermination pursuant to court remand are also reviewed ‘for compliance with the court's remand order.’ " Xinjiamei Furniture (Zhangzhou) Co. v. United States, 38 CIT ––––, ––––, 968 F. Supp. 2d 1255, 1259 (2014) (quoting Nakornthai Strip Mill Public Co. v. United States, 32 C.I.T. 1272, 1274, 587 F. Supp. 2d 1303, 1306 (2008) ).

DISCUSSION

I. Exhaustion

Prime Time argues that Commerce ignored remand instructions to use Prime Time's questionnaire responses, along with gap-filling information, to calculate a rate for Prime Time; and, that Commerce's explanation regarding its practice of calculating an importer-specific rate only when Commerce calculates a margin for an individually-examined exporter, was insufficient and unreasonable. See Prime Time's Br. at 5–9. In response, Defendant argues that Prime Time misstates the remand instructions and that the court should not consider Prime Time's submissions with respect to Commerce's refusal to calculate an importer-specific assessment rate because Prime Time did not exhaust...