Pro-Team Coil Nail Enter., Inc. v. United States

587 F.Supp.3d 1364

PRO-TEAM COIL NAIL ENTERPRISE, INC. and PT Enterprise Inc., Plaintiffs,

Unicatch Industrial Co., Ltd., TC International, Inc., Hor Liang Industrial Corp., Romp Coil Nails Industries Inc., and PrimeSource Building Products, Inc., Consolidated Plaintiffs,

and

S.T.O. Industries, Inc., Plaintiff-Intervenor,

v.UNITED STATES, Defendant,andMid Continent Steel & Wire, Inc., Defendant-Intervenor.

Slip Op. 22-84

Consol. Court No. 18-00027

United States Court of International Trade.

July 15, 2022

Ned H. Marshak, Max F. Schutzman, and Andrew T. Schutz, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, of New York, NY, for Consolidated Plaintiffs Hor Liang Industrial Corp. and Romp Coil Nails Industries Inc.

Sosun Bae, Senior Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for Defendant United States. With her on the brief were Brian M. Boynton, Acting Assistant Attorney General and Patricia M. McCarthy, Director. Of counsel on the brief was Vania Wang, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Adam H. Gordon and Ping Gong, The Bristol Group PLLC, of Washington, DC, for Defendant-Intervenor Mid Continent Steel & Wire, Inc.

OPINION

Barnett, Chief Judge:

This consolidated action is before the court on the U.S. Department of Commerce's ("Commerce" or "the agency") third remand results in the first administrative review of the antidumping duty order on certain steel nails from Taiwan. See Results of [Third] Redetermination Pursuant to Court Remand ("Third Remand Results"), ECF No. 127-1; see generally Certain Steel Nails From Taiwan , 83 Fed. Reg. 6,163 (Dep't Commerce Feb. 13, 2018) (final results of antidumping duty admin. review and partial rescission of admin. review; 2015–2016) (" Final Results "), ECF No. 20-2, and accompanying Issues and Decision Mem., A-583-854 (Feb. 6, 2018), ECF No. 20-3.¹ The court has previously issued three opinions resolving substantive issues in this case; familiarity with these opinions is presumed. See Pro-Team Coil Nail Enter. v. United States ("Pro-Team III "), 45 CIT ––––, 532 F. Supp. 3d 1281 (2021) ; Pro-Team Coil Nail Enter. v. United States ("Pro-Team II "), 44 CIT ––––, 483 F. Supp. 3d 1242 (2020) ; Pro-Team Coil Nail Enter. v. United States ("Pro-Team I "), 43 CIT ––––, 419 F. Supp. 3d 1319 (2019).

After three remand determinations, the issue remaining before the court is whether Commerce properly determined the antidumping duty rate to be applied to respondents that were not selected for individual examination (i.e., the non-selected respondents). As discussed below, pursuant to these remand determinations, Commerce has assigned rates based on total adverse facts available² to two selected respondents, calculated a zero percent margin for a third selected respondent, and calculated the weighted average of these three rates to apply to the non-selected respondents. Some of the non-selected respondents, Hor Liang Industrial Corp. and Romp Coil Nails Industries (together, "Plaintiffs") challenge that rate as not reasonably reflective of their potential dumping margins and, therefore, not based on substantial evidence. Confidential Consol. Pls.’, Hor Liang Indus. Corp. & Romp Coil Nails Indus. Inc., Cmts. on Redetermination ("Opp'n Cmts.") at 6–10, ECF No. 129. Defendant United States and Defendant-Intervenor Mid Continent Steel & Wire, Inc. submitted comments urging the court to sustain the rate calculated in the Third Remand Results. See generally Confidential Def.’s Resp. to the [Opp'n Cmts.], ECF No. 134; Def.-Int. Mid Continent Steel & Wire, Inc.’s Cmts. in Support of [Third Remand Results], ECF No. 133.

For the reasons that follow, the court affirms Commerce's determination of the non-selected respondents’ rate using the so-called expected method.³

BACKGROUND

In this administrative review, Commerce selected three respondents for individual examination (i.e., the "mandatory respondents"): Pro-Team Coil Nail Enterprise, Inc. ("Pro-Team"); Unicatch Industrial Co., Ltd. ("Unicatch"); and Bonuts Hardware Logistics Co., LLC ("Bonuts"). Third Remand Results at 3. Commerce initially used AFA (the petition rate) to determine the dumping rates for each of the mandatory respondents. See id. at 3. Bonuts did not challenge the AFA rate it was assigned. See Pro-Team I , 419 F. Supp. 3d at 1323–25. Over the course of this litigation, Commerce continued to use the AFA rate for Unicatch and calculated a dumping margin of zero percent for Pro-Team, each of which has been sustained by this court. See Pro-Team III , 532 F. Supp. 3d at 1294 (sustaining Commerce's selection of the petition rate as AFA for Unicatch); Pro-Team II , 483 F. Supp. 3d at 1252 (sustaining Commerce's calculation of a zero percent dumping margin for Pro-Team). To calculate the non-selected respondents’ rate, in the second remand results, Commerce used a simple average of the mandatory respondents’ rates. See Final Results of [Second] Redetermination Pursuant to Court Remand at 12, ECF No. 99-1.

In Pro-Team III , the court remanded Commerce's use of a simple average to calculate the rate for non-selected respondents. 532 F. Supp. 3d at 1294. The court found that substantial evidence did not support Commerce's departure from the "expected method" (i.e., using a weighted average to calculate the non-selected respondents’ rate) because Commerce had not explained why the U.S. Customs and Border Protection ("CBP") import volume data it had relied on for selecting mandatory respondents was not reliable for the purpose of calculating a dumping rate using the "expected method." Id. at 1293–94.

In the Third Remand Results, Commerce determined that it was feasible to rely on the CBP import volume data. Third Remand Results at 7–8. Thus, Commerce determined the dumping margin for non-selected respondents by calculating a weighted average of the margins of the mandatory respondents. Id. This use of the expected method resulted in an antidumping duty rate of 35.30 percent for the non-selected respondents. See id. at 17.

Commerce explained that this rate was reasonably reflective of Plaintiffs’ dumping margins because there was no indication that mandatory respondents were not representative of non-selected companies. Id. Commerce also explained that there was no evidence that the 35.30 percent rate was not reasonably reflective of Plaintiffs’ dumping margins because Plaintiffs were not individually examined in the investigation, and the rate assigned to both non-cooperating mandatory respondents had been corroborated using data from Pro-Team. See id. at 18. Commerce further found that there was no evidence that the rate determined using the expected method was punitive. Id. at 18–19.

Commerce rejected Plaintiffs’ arguments that Bonuts’ margin should not be included in determining the rate for non-selected respondents. Id. at 15. Commerce stated that Bonuts was chosen as a mandatory respondent because it was an exporter or producer accounting for the largest volume of subject merchandise during the period of review, and that case law supported the assumption that mandatory respondents are representative of non-examined respondents absent substantial evidence to the contrary. Id. at 15–16.

Finally, Commerce rejected Plaintiffs’ suggestion that it should reopen the record to allow parties to submit data "necessary to obtain a ‘reasonable’ rate for [Plaintiffs]." Id. at 19. Commerce explained that no additional information was required to determine the non-selected respondents’ rate. Id.

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). 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

At issue is whether Commerce's use of the expected method to determine the non-selected respondents’ rate is supported by substantial evidence and otherwise in accordance with law when Commerce calculated the rate in part using AFA rates assigned to mandatory respondents. The court recently addressed a similar issue in an opinion dismissing a challenge to the results of the fourth administrative review of this order. See PrimeSource Bldg. Prods., Inc., v. United States , 581 F.Supp.3d 1331, 1344 (CIT June 16, 2022). The court incorporates and restates much of the reasoning articulated in that opinion in rejecting Plaintiffs’ challenge to the Third Remand Results.

I. Legal Framework

The statute is silent regarding how to determine the rate for companies not selected for individual examination in an administrative review. In determining the rates for such companies, Commerce looks to 19 U.S.C. § 1673d(c)(5) for guidance.⁵ See, e.g. , Albemarle , 821 F.3d at 1352 & n.6. Section 1673d(c)(5)(A) provides that the "all-others rate" assigned to non-examined companies is calculated as "the weighted average of the estimated weighted average dumping margins" assigned to individually-examined companies, "excluding any zero and de minimis margins, and any margins determined entirely under section 1677e of this title [i.e., on the basis of adverse facts available]." 19 U.S.C. § 1673d(c)(5)(A).

When the dumping margins assigned to all individually examined companies are zero, de minimis , or based on facts available, the statute further provides that Commerce "may use any reasonable method to establish the estimated all-others rate for exporters and producers not individually investigated, including averaging the estimated weighted average dumping margins determined for the exporters and producers individually investigated." Id. § 1673d(c)(5)(B).

The Statement of Administrative Action accompanying the Uruguay Round Agreements Act, which Congress has...