Evonik Rexim (Nanning) Pharm. Co. v. United States

• Decision Date: 01 August 2017
• Docket Number: Slip Op. 17-94, Consol. Court No. 15-00296.
• Citation: 253 F.Supp.3d 1364
• Parties: EVONIK REXIM (NANNING) PHARMACEUTICAL CO. LTD. and Evonik Corporation, Plaintiffs, and Baoding Mantong Fine Chemistry Co., Ltd. and GEO Specialty Chemicals, Inc., Consolidated Plaintiffs, v. UNITED STATES, Defendant, and GEO Specialty Chemicals, Inc., Defendant–Intervenor.
• Court: U.S. Court of International Trade

253 F.Supp.3d 1364

EVONIK REXIM (NANNING) PHARMACEUTICAL CO. LTD. and Evonik Corporation, Plaintiffs,

and

Baoding Mantong Fine Chemistry Co., Ltd. and GEO Specialty Chemicals, Inc., Consolidated Plaintiffs,

v.UNITED STATES, Defendant,andGEO Specialty Chemicals, Inc., Defendant–Intervenor.

Slip Op. 17-94, Consol. Court No. 15-00296.

United States Court of International Trade.

August 1, 2017

Matthew T. McGrath, Barnes, Richardson & Colburn, LLP, of Washington, DC, argued for Plaintiffs Evonik Rexim (Nanning) Pharmaceutical Co. Ltd. and Evonik Corporation. With him on the brief was Stephen W. Brophy.

Ronald M. Wisla, Kutak Rock LLP, of Washington, DC, argued for Consolidated Plaintiff Baoding Mantong Fine Chemistry Co., Ltd. With him on the brief was Lizbeth R. Levinson.

David M. Schwartz, Thompson Hine LLP, of Washington, DC, argued for Consolidated Plaintiff and Defendant–Intervenor GEO Specialty Chemicals, Inc.

Robert M. Norway, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for Defendant United States. With him on the brief were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel on the brief was Nanda Srikantaiah, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC.

OPINION AND ORDER

Choe–Groves, Judge:

This case involves glycine

, which is a free-flowing crystalline material, like salt or sugar. Glycine is produced at varying levels of purity and is used as a sweetener or taste enhancer, a buffering agent, reabsorbable amino acid, chemical intermediate, and a metal complexing agent. See Issues and Decision Memorandum for the Final Results of Antidumping Duty Administrative Review at 3, A–570–836, (Oct. 5, 2015), available at http://enforcement.trade.gov/frn/summary/prc/2015–26270–1.pdf (last visited July 25, 2017) ("I & D Memo"). Evonik Rexim (Nanning) Pharmaceutical Co. Ltd. and Evonik Corporation (collectively, "Evonik" or "Plaintiffs"), Baoding Mantong Fine Chemistry Co., Ltd. ("Baoding"), and GEO Specialty Chemicals, Inc. ("GEO") (collectively, "Consolidated Plaintiffs") bring this consolidated action for judicial review of decisions made by the U.S. Department of Commerce ("Commerce" or "Department") during the 2013–2014 administrative review of the antidumping duty order on glycine from the People's Republic of China ("China" or "PRC"). See Glycine From the People's Republic of China, 80 Fed. Reg. 62,027 (Dep't Commerce Oct. 15, 2015) (final results of antidumping duty administrative review and partial rescission of antidumping duty administrative review; 2013–2014) ("Final Results"); I & D Memo; see also Glycine From the People's Republic of China, 60 Fed. Reg. 16,116 (Dep't Commerce Mar. 29, 1995) (antidumping duty order). Before the court are Rule 56.2 motions for judgment on the agency record filed by Evonik, Baoding, and GEO. See Evonik's Mot. J. Agency R. Under USCIT Rule 56.2, May 20, 2016, ECF No. 31; 56.2 Mot. J. Agency R., May 19, 2016, ECF No. 30; Mot. J. Agency R., May 20, 2016, ECF No. 32. For the reasons set forth below, the court sustains in part and remands in part Commerce's final determination.

BACKGROUND

Commerce initiated an administrative review of the antidumping duty order on glycine

from China on April 30, 2014, which covered subject merchandise that entered the United States between March 1, 2013 and February 28, 2014. See

Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 79 Fed. Reg. 24,398, 24,400 (Dep't Commerce Apr. 30, 2014). The Department issued preliminary results on April 8, 2015. See

Glycine From the People's Republic of China, 80 Fed. Reg. 18,814, 18,814 (Dep't Commerce Apr. 8, 2015) (preliminary results of the antidumping duty administrative review and preliminary intent to rescind, in part; 2013–2014); Decision Memorandum for the Preliminary Results of Antidumping Duty Administrative Review, A–570–836, (Mar. 31, 2015), available at http://enforcement.trade.gov/frn/summary/prc/2015–07952–1.pdf (last visited July 25, 2017) ("Preliminary Results Memo"). After Commerce issued preliminary results, Evonik, Baoding, and GEO each submitted timely administrative case briefs contesting various aspects of Commerce's determinations. See Case Brief of Evonik Rexim (Nanning) Pharmaceutical Co., Ltd., CD 80 at bar code 3275324–01, PD 216 at bar code 3275328–01 (May 8, 2015); Administrative Case Brief of Baoding Mantong Fine Chemistry Co., Ltd, CD 83 at bar code 3275402–01, PD 220 at bar code 3275404–01 (May 8, 2015) ("Baoding's Administrative Case Brief"); GEO Specialty Chemicals' Case Brief, CD 82 at bar code 3275332–01, PD 218 at bar code 3275335–01 (May 8, 2015).

GEO challenged the inclusion of certain information in Baoding's brief regarding the final determination in a prior administrative review of the antidumping duty order on glycine

from China. See Corrections to Transcript of July 22, 2015 Public Hearing for 2013–2014 Administrative Review, PD 228 at bar code 3294933–01 (July 30, 2015). Commerce rejected Baoding's case brief because Commerce found that the brief contained untimely-filed new factual information. See Resp. to August 7, 2015, Letter from Baoding Mantong Fine Chemistry Co., Ltd. and Rejection of May 8, 2015, and August 7, 2015, Submissions by Baoding Mantong Fine Chemistry Co., Ltd., PD 236 at bar code 3300878–01 (Aug. 27, 2015) ("Commerce Aug. 27 Letter"). The Department offered Baoding the opportunity to resubmit a redacted version of the case brief by August 31, 2015. See

id. Three days after that deadline expired, Baoding submitted the redacted version of its case brief and a letter that urged Commerce to exercise its discretion to accept the late-filed brief. See Submission of Baoding Mantong's Revised Administrative Case Brief and Revised Administrative Case Brief of Baoding Mantong Fine Chemistry Co., Ltd, CD 86 at bar code 3302223–01, PD 237 at bar code 3302224–01 (Sept. 3, 2015). The Department rejected Baoding's redacted brief as untimely and informed the interested parties that it would not consider any arguments in Baoding's original brief. See Rejection of September 3, 2015, Submission by Baoding Mantong Fine Chemistry Co., Ltd., PD 240 at bar code 3307996–01 (Sept. 22, 2015). Commerce required GEO to submit a new version of its rebuttal brief redacting all references to issues raised in Baoding's original case brief. See id.

Commerce published the final results of the administrative review and accompanying memorandum on October 5, 2015. See Final Results, 80 Fed. Reg. at 62,027. With respect to Evonik, the Department determined that Evonik's sales during the review period were not bona fide , rescinded Evonik's review, and indicated that it would instruct U.S. Customs and Border Protection to liquidate Evonik's entries at the PRC-wide antidumping duty rate. See id.; I & D Memo at 20–24; Final Analysis of Bona Fide Nature of Evonik Rexim (Nanning) Pharmaceutical Co., Ltd.'s Sales, CD 88 at bar code 3404119–01, PD 249 at bar code 3404122–01 (Oct. 5, 2015) ("Commerce Final Bona Fide Sales Memo for Evonik"). With regard to Baoding, Commerce determined that Baoding's sale during the review period was bona fide and assigned a calculated dumping margin of 143.87 percent. See Final Results, 80 Fed. Reg. at 62,027 ; I & D Memo at 11–12; Final Analysis Memorandum and Business Proprietary Bona Fide Analysis for Baoding Mantong Fine Chemistry Co., Ltd., CD 89 at bar code 3404441–01, PD 250 at bar code 3404464–01 (Oct. 5, 2015) ("Commerce Final Bona Fide Sale Memo for Baoding"). To calculate Baoding's normal value, Commerce used import statistics for aqueous ammonia as the surrogate value for Baoding's liquid ammonia factor of production input and used financial statements from two Indonesian companies to determine the surrogate financial ratios. See Final Results, 80 Fed. Reg. at 62,027 ; I & D Memo at 11–12. The Department granted Baoding an offset to normal value for its sales of hydrochloric acid and ammonium chloride, which were generated as by-products of Baoding's glycine

production process. See Final Results, 80 Fed. Reg. at 62,027 ; I & D Memo at 11–12.

The Parties commenced separate actions contesting several of Commerce's determinations in the Final Results, and the court consolidated these actions on January 21, 2016. See Order, Jan. 21, 2016, ECF No. 25 (granting Defendant's motion for consolidation). Plaintiffs and Consolidated Plaintiffs filed their respective Rule 56.2 motions and the court held oral argument on March 8, 2017. Evonik subsequently filed a motion to sever and stay its claim regarding the application of the PRC-wide antidumping duty rate. See Mot. Sever Claim and to Stay Severed Claim, May 25, 2017, ECF No. 68. The court granted the motion to sever this claim from Evonik's complaint and to stay the claim pending the final disposition of a similar claim in Baoding Mantong Fine Chemistry Co., Ltd. v. United States, Court No. 12–00362. See Order, June 1, 2017, ECF No. 70; Evonik Rexim (Nanning) Pharmaceutical Co. Ltd. v. United States, Court No. 17–00132.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction over Commerce's final determination in an administrative review of an antidumping duty order. See 28 U.S.C. § 1581(c) (2012) ;¹ Section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2012).² The court will uphold the Department's "determinations, findings, or conclusions" unless "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i). When reviewing substantial evidence challenges to Commerce's decisions in an administrative review, the court assesses whether the agency action is "unreasonable" given the record as a whole. See ...