Union Steel Mfg. Co. v. United States, Slip Op. 16–117

190 F.Supp.3d 1326

Union Steel Manufacturing Company, Ltd., Plaintiff,andWhirlpool Corporation, Plaintiff–intervenor,

v. United States, Defendant,andUnited States Steel Corporation, Nucor Corporation, and Hyundai Hysco, Defendant–intervenors.

Slip Op. 16–117

Consol. Court No. 10–00106

United States Court of International Trade.

December 15, 2016

Brady W. Mills and Donald B. Cameron, Morris, Manning & Martin, LLP, of Washington, DC, argued for plaintiff Union Steel Manufacturing Company, Ltd. With them on the brief were Julie C. Mendoza, R. Will Planert, Mary S. Hodgins, and Sarah S. Sprinkle.

Donald B. Cameron, Morris, Manning & Martin, LLP, of Washington, DC, argued for plaintiff Dongbu Steel Company, Ltd. With him on the brief were Brady W. Mills, Julie C. Mendoza, R. Will Planert, Mary S. Hodgins, and Sarah S. Sprinkle.

Donald Harrison, Gibson, Dunn & Crutcher, LLP, of Washington, DC, for plaintiff–intervenor Whirlpool Corporation.

L. Misha Preheim, Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With him on the brief were Stuart F. Delery, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel for defendant was Michael Thomas Gagain, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, Washington, DC.

Jeffery David Gerrish and Robert E. Lighthizer, Skadden, Arps, Slate, Meagher & Flom LLP, of Washington, DC, for plaintiff and defendant–intervenor United States Steel Corporation.

Timothy C. Brightbill, Wiley Rein LLP, of Washington, DC, argued for defendant–intervenor Nucor Corporation. With him on the brief was Alan H. Price.

J. David Park, Arnold & Porter LLP, of Washington, DC, for plaintiff and defendant–intervenor Hyundai HYSCO.

OPINION

Timothy C. Stanceu, Chief Judge

In this consolidated action, four plaintiffs contested an administrative determination that the International Trade Administration, U.S. Department of Commerce ("Commerce" or the "Department") issued to conclude the fifteenth periodic administrative review of an antidumping duty order on certain corrosion-resistant carbon steel flat products (the "subject merchandise") from the Republic of Korea ("Korea").¹ Before the court is a determination (the "Second Remand Redetermination") Commerce issued in response to the court's order in Union Steel Mfg. Co., Ltd. v. United States , 38 CIT ––––, 968 F.Supp.2d 1297 (2014) (" Union Steel II" ). Results of Redetermination Pursuant to Remand (Aug. 1, 2014), ECF Nos. 222 (Conf.), 223 (Public) ("Second Remand Redetermination" ). The court affirms the Second Remand Redetermination.

I. BACKGROUND

Background on this case is provided in the court's two previous opinions and orders. See Union Steel Mfg. Co., Ltd. v. United States , 36 CIT ––––, 837 F.Supp.2d 1307 (2012) (" Union Steel I" ); Union Steel II , 38 CIT at ––––, 968 F.Supp.2d at 1300–02. In this Opinion and Order, the court supplements that background information.

A. The Parties to this Action

Three of the four plaintiffs in this action, Union Steel Manufacturing Co., Ltd. ("Union"), Hyundai HYSCO ("HYSCO"), and Dongbu Steel Co., Ltd. ("Dongbu"), are Korean producers and exporters of the subject merchandise. Union and HYSCO were mandatory respondents in the fifteenth administrative review; Dongbu was an unexamined respondent. The remaining plaintiff, United States Steel Corporation ("U.S. Steel"), was a petitioner in the fifteenth administrative review and is a defendant–intervenor in this action. Nucor Corporation ("Nucor") also was a petitioner in the fifteenth administrative review and also is a defendant–intervenor.

B. The Contested Determination

The administrative determination contested by the four plaintiffs ("Final Results") is Certain Corrosion–Resistant Carbon Steel Flat Products from the Republic of Korea: Notice of Final Results of the Fifteenth Admin. Review , 75 Fed. Reg. 13,490 (Mar. 22, 2010) ("Final Results" ). The fifteenth review pertained to entries of subject merchandise made during the period of August 1, 2007 through July 31, 2008 ("period of review" or "POR"). Final Results , 75 Fed. Reg. at 13,490. In the Final Results, Commerce incorporated by reference an Issues & Decision Memorandum ("Decision Memorandum"). Issues & Decision Mem., A–580–816, ARP 07–08 (Mar. 15, 2010) (Admin.R.Doc. No. 5249) ("Decision Mem." ). In the Final Results, Commerce assigned weighted-average dumping margins of 14.01% to Union and 3.29% to HYSCO. Final Results , 75 Fed. Reg. at 13,491. As an unexamined respondent, Dongbu received the margin of 8.65% that Commerce assigned to all unexamined respondents, which Commerce calculated as a simple average of the non-de-minimis margins of the examined respondents. Id.

C. The Redeterminations Commerce Issued in Response to the Court's Orders

Commerce issued a redetermination in response to the court's order in Union Steel I . Results of Redetermination Pursuant to Remand (Sept. 24, 2012), ECF No. 161 ("First Remand Redetermination" ). In that redetermination ("First Remand Redetermination"), Commerce revised Union's margin from 14.01% to 9.85% and HYSCO's margin from 3.29% to 1.46%. Id. at 67. Again assigning Dongbu a margin based on a simple average of the margins calculated for Union and HYSCO, Commerce changed Dongbu's margin from 8.65% to 5.56%. Id.

Following consideration of comments submitted to the court on the First Remand Redetermination and an oral argument, the court issued its decision in Union Steel II . In response, Commerce issued the Second Remand Redetermination, now before the court. In the Second Remand Redetermination, Commerce revised the 9.85% margin it previously determined for Union to 9.83%. Second Remand Redetermination 44. It revised HYSCO's margin from 1.46% to 5.56%. Id. Once again assigning Dongbu a margin based on a simple average of the Union and HYSCO margins, Commerce changed Dongbu's margin from 5.56% to 7.70%. Id.

Union and Dongbu commented in opposition to the Second Remand Redetermination, each raising essentially the same objections. Comments of Union Steel on the U.S. Dep't of Commerce's Aug. 1, 2014 Results of Redetermination Pursuant to Remand (Sept. 16, 2014), ECF Nos. 231 (Conf.), 232 (Public) ("Union's Comments" ); Comments of Dongbu Steel on the U.S. Dep't of Commerce's Aug. 1, 2014 Results of Redetermination Pursuant to Remand (Sept. 16, 2014), ECF No. 233. ("Dongbu's Comments" ). HYSCO opposed the Second Remand Redetermination on a different ground. Response of Hyundai HYSCO to Defendant's Second Redetermination on Remand (Sept. 16, 2014), ECF Nos. 234 (Conf.), 235 (Public). Defendant responded to these comment submissions. Def.'s Resp. to Comments on the Second Results of Redetermination Pursuant to Court Remand (Oct. 29, 2014), ECF Nos. 244 (Conf.), 245 (Public). The court held a second oral argument on April 16, 2015. ECF No. 260.

II. DISCUSSION

A. Jurisdiction and Standard of Review

The court exercises jurisdiction under section 201 of the Customs Courts Act of 1980, 28 U.S.C. § 1581(c) (2006), pursuant to which the court reviews actions commenced under section 516A of the Tariff Act of 1930 ("Tariff Act"), 19 U.S.C. § 1516a, including an action contesting the final results of an administrative review that Commerce issues under section 751 of the Tariff Act, 19 U.S.C. § 1675(a).² When reviewing a determination of Commerce, including one issued in response to an order of remand, the court "shall hold unlawful any determination, finding, or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law. ..." 19 U.S.C. § 1516a(b)(1)(B)(i).

B. Decisions in the Second Remand Redetermination to which No Party Objects

In Union Steel II , the court sustained the First Remand Redetermination in part and remanded the decision to Commerce with the directive that Commerce reconsider the position taken on certain specific issues. With respect to four of the issues the court ordered Commerce to reconsider, no party has objected to the resolution Commerce reached in the Second Remand Redetermination. Those four issues are discussed below.

1. Nucor's Objections to the Calculation of Union's Interest Expense Ratio

In Union Steel II , the court noted that Nucor had raised certain objections to the Department's method for redetermining Union's interest expense ratio. The court discussed these objections in detail in Union Steel II , 38 CIT at ––––, 968 F.Supp.2d at 1307–08. In brief summary, Nucor argued that Commerce should not have made a major input adjustment for steel coil when calculating the interest expense ratio and that even if it was permissible to do so, Commerce erred by using a method that double counted the major input adjustment. Id. Without opining on the merits of Nucor's objections, the court concluded that Commerce had failed to address these objections in the First Remand Redetermination and must do so in response to the order the court was issuing in Union Steel II. Id. , 38 CIT at ––––, 968 F.Supp.2d at 1308.

In the Second Remand Redetermination, Commerce has responded to both of Nucor's objections. Commerce explained, first, that the major input adjustment Commerce made to the cost of direct materials as part of the calculation of the cost of manufacturing ("COM") necessitated a conforming change to the cost of sales ("COS") denominator that was used in the calculation of the interest expense ratio because the ratio was applied to the product-specific COM that included the major input adjustment. Second Remand Redetermination 8. According to Commerce, "[t]his methodology ensured that the financial expense ratio and the COM to which the ratio was applied were on the same basis." Id. (footnote omitted). Second, Commerce explained that it was necessary to adjust the COS denominator for the major input adjustment to ensure that...