Toscelik Profil Ve Sac Endustrisi A.S. v. United States

TOSCELIK PROFIL VE SAC ENDUSTRISI A.S., Plaintiff, v. UNITED STATES, Defendant.

Slip Op. 15 - 144 Court No. 14-00211

UNITED STATES COURT OF INTERNATIONAL TRADE

December 21, 2015

Before: R. Kenton Musgrave, Senior Judge

OPINION AND ORDER

[Remanding administrative review of respondent's countervailing duty rate.]

David L. Simon, Law Offices of David L. Simon, of Washington DC, for the plaintiff.

Melissa M. Devine, Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington DC, for the defendant. With her on the brief were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, and Franklin E. White, Jr., Assistant Director. Of Counsel on the brief was David P. Lyons, Attorney, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce.

Musgrave, Senior Judge: The plaintiff, Toscelik Profil ve Sac Endustrisi A.S. ("Toscelik"), a producer of subject merchandise for the Turkish domestic and export markets, filed this action to contest Circular Welded Carbon Steel Pipes And Tubes From Turkey: Final Results of Countervailing Duty Administrative Review; Calendar Year 2012 and Rescission of Countervailing Duty Administrative Review, in Part, 79 Fed. Reg. 51140 (Aug. 27, 2014) ("2012 CVD Review"). The matter concerns Toscelik's net subsidy rate, which was incorporated into the 2012 CVD Review results by reference to the prior 2011 CVD Review segment of the CVD proceeding.¹ The plaintiff challenges the posture of the 2012 CVD Review due to its successful litigation of the 2011 CVD Review. See Toscelik Profil ve Sac Endustrisi A.S. v. United States, 38 CIT ___, Slip Op. 14-126 (Oct. 29, 2014) ("Toscelik I"), remand results sustained, 39 CIT ___, Slip Op. 15-28 (Apr. 1, 2015) ("Toscelik II"). The defendant, International Trade Administration, U.S. Department of Commerce ("ITA" or "Commerce"), argues Toscelik failed to exhaust its administrative remedies.

I. Background

Prior to publication of the review for year 2011, Commerce initiated the year 2012 review and selected Borusan Mannesmann Boru Sanayi ve Ticaret A.S. (Borusan) as the sole mandatory respondent. Respondent Selection Memorandum at 4-5 (May 17, 2013), PDoc 17. Toscelik participated in the proceeding by filing comments concerning respondent selection matters. See Toscelik Respondent Selection Comments (May 13, 2013), PDoc 13.

Commerce published the 2011 CVD Review on October 30, 2013, assigning Toscelik a subsidy rate of 0.83 percent. 78 Fed. Reg. 64917. On November 5, 2013, Toscelik appealed that proceeding here. In its opening brief, Toscelik argued that certain deficiencies in the calculation of a land benchmark rendered the 2011 subsidy rate invalid. See Pl. Mot. for Judgment Upon the Admin. Record, Toscelik Profil ve Sac Endustrisi A.S. v. United States, No. 13-00371 (CIT Mar. 21, 2014), ECF No. 28.

On April 23, 2014, Commerce published its preliminary results of the 2012 review. Circular Welded Carbon Steel Pipe and Tube Products from Turkey, 79 Fed. Reg. 22625 (Apr. 23, 2014) (prelim. determ.) (2012 Preliminary Results), and accompanying preliminary decision memorandum (Apr. 17, 2014) ("PDM"), PDoc 109. Commerce calculated a de minimis rate for Borusan. PDM at 1. However, in accordance with its practice, Commerce did not assign Toscelik a de minimis rate as well; rather, Commerce assigned Toscelik the subsidy rate of 0.83 percent that Toscelik had received in the 2011 CVD Review results. Id. at 7.

Pursuant to its regulations, Commerce provided 30 days for interested parties to submit case briefs and five days thereafter to submit rebuttal briefs on the 2012 Preliminary Results. 79 Fed. Reg. at 22627. The government emphasizes that Toscelik did not file case or rebuttal briefs, nor did Toscelik comment upon the 2012 Preliminary Results in some other form or request an extension to submit arguments. See Admin. Record at 15-35, ECF No. 16.

In the 2012 CVD Review, published in August 2014, Commerce continued to apply the 0.83 percent subsidy rate to Toscelik as in the 2012 Preliminary Results. 79 Fed. Reg. at 51141. Commerce did not evaluate or address arguments regarding the subsidy rate Toscelik received because the record contained no challenges to that rate. See id.; see also IDM at 3-4.

Thereafter, on February 13, 2015, in its final remand results concerning the 2011 CVD Review, Commerce revised the land benchmark used to calculate Toscelik's 2011 subsidy rate, lowering Toscelik's subsidy rate for the 2011 period of review from 0.83 percent to 0.44 percent. Final Results of Redetermination Pursuant to Court Remand, Toscelik Profil ve Sac Endustrisi AS v. United States, No. 13-00371 (Feb. 13, 2015). Those results were sustained on April 1, 2015. Toscelik II, Slip Op. 15-28.

II. Jurisdiction and Standard of Review

Toscelik has standing under 19 U.S.C. §1516a(d) and 28 U.S.C. §2631(c), and judicial review concerns whether Commerce's countervailing duty determinations are unsupported by substantial evidence on the record or otherwise not in accordance with law. 19 U.S.C. § 1516a(b)(1)(B)(i). See Royal Thai Government v. United States, 436 F.3d 1330, 1335 (Fed. Cir. 2006). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Universal Camera Corp. v. NLRB, 340 U.S. 474, 477 (1951).

Pursuant to 28 U.S.C. § 2637(d), the court "shall, where appropriate, require the exhaustion of administrative remedies." The court "generally takes a 'strict view' of the requirement that parties exhaust their administrative remedies." Corus Staal BV v. United States, 502 F.3d 1370, 1379 (Fed. Cir. 2007) (citations omitted).²

III. Discussion

Because Commerce recalculated via remand the subsidy rate underlying Toscelik's 2011 rate, Toscelik's opening brief argues that those results should extend to this 2012 review. See Pl's Br. at 4-6; Compl. ¶21. The government's sole objection is that Toscelik failed to exhaust that argument before Commerce in the first instance. See generally Def's Resp.

The government posits that Toscelik "chose" not to exhaust even though the issue of the 0.84 percent subsidy rate was "squarely in play" in the 2012 Preliminary Results. Def's Resp. at 6, referencing Yangzhou Bestpak Gifts & Crafts Co. v. United States, 716 F.3d 1370, 1380-81 (Fed. Cir. 2013) ("Bestpak"); QVD Food Co. v. United States, 34 CIT 1166, 1176, 721 F. Supp. 2d 1311, 1320 (2010), aff'd, 658 F.3d 1318 (Fed. Cir. 2011); Gerber Food (Yunnan) Co. v. United States, 33 CIT 186, 197-98, 601 F. Supp. 2d 1370, 1381-82 (2009). The government contends that the "same procedural posture existed administratively", requiring exhaustion, as what Toscelik is attempting to accomplish here judicially,³ see id. at 7-8, and that the 2012 CVD Review is an entirely separate proceeding, id. at 8-9 (citation omitted). "Commerce is not required to consider information beyond the administrative record in question", id. at 9, referencing Essar Steel Ltd. v. United States, 678 F.3d 1268, 1277 (Fed. Cir. 2012),⁴ and "[t]he court may not force Commerce to reach outsidethe administrative record in question even if a particular document or argument would, if raised at the administrative level, be relevant to Commerce's determination", id. (citation omitted). The government therefore argues "[i]t is . . . of no moment that the arguments Toscelik made in the 2011 review and ensuing litigation ultimately earned it a redetermined subsidy rate for 2011." Id.

Distinguishing Toscelik's reliance upon Maverick Tube Corp. v. United States, see 39 CIT ___, Slip Op. 15-59 (June 15, 2015) at 12, on that ground that Toscelik in fact pursued and exhausted administrative remedies on the issue in that case,⁵ and distinguishing the remand order relating to the 2011 CVD Review from Toscelik I on the bases that not only did Commerce's request for voluntary remand moot the exhaustion argument raised by one of the domestic industry petitioners, see Toscelik I, Slip Op. 14-126 at 11 n.11, but also that in the original administrative proceeding Toscelik had in fact advocated for the revised benchmark in its rebuttal brief in response to petitioners' case brief,⁶ the government in the end contends that Toscelik fails to support its contention that any argument regarding the use of its 2011 rate would have been fruitless or that Commerce would not have considered and addressed such arguments; that even given a substantial likelihood that Commerce would have rejected them, "it still would have been preferable, for purposes of administrative regularity and judicial efficiency" for parties "to make arguments in casebrief[s] and for Commerce to give its full and final administrative response in the final results." See Def's Resp. at 12, quoting Corus Staal BV v. United States, 502 F.3d 1370, 1380 (Fed. Cir. 2007). The government argues Toscelik has neither satisfied this "standard" nor explained how Commerce would have been unwilling or unable to consider its arguments during the 2012 administrative review; specifically with respect to Toscelik's assertion that filing a case brief would not have prompted Commerce to do "anything other than what was done at the preliminary phase", Pl. Br. at 5, the government contends that this is "unsupported speculation" and that Toscelik provides no other reason to presume that Commerce "would have overlooked" arguments on the 2012 rate.

Here, the government again emphasizes that during the 2011 review Toscelik took administrative steps to oppose the 2011 subsidy rate and that the final results for the 2011 CVD Review preceded the 2012 Preliminary Results by more than six months; however, Toscelik "declined" to submit arguments on the 2012 Preliminary Results and therefore Toscelik "denied Commerce the opportunity to consider its arguments concerning the 2012 Preliminary Results and the petitioners the opportunity to comment upon Toscelik's...