Coal. for Pres. of Amer Brake Drum & Rotor v. U.S., Slip Op. 99-20.

Decision Date19 February 1999
Docket NumberSlip Op. 99-20.,Court No. 97-05-00874.
PartiesThe COALITION FOR THE PRESERVATION OF AMERICAN BRAKE DRUM AND ROTOR AFTERMARKET MANUFACTURERS, Plaintiff, v. THE UNITED STATES, Defendant, China National Automotive Industry Import & Export Co., Midwest Air Technologies, Inc., Mat Automotive Inc., Shenyang Honbase Machinery Co., Ltd., Laizhou Luyuan Automobile Fitting Co., Ltd., Quingdao Metal, Minerals & Machinery Import & Export Corp., Yantai Import & Export Corp., Laizhou Sanli Machinery-Making Co., Longkou Bohai Machinery Co., Yenhere Corp., Laizhou Capco Machinery Co., Ltd., Beijing Xinchangyuan Automobile Fittings Corp., China National Machinery Import & Export Co., China National Machinery Import & Export (Xinjiang) Co., Xianghe Zichen Group Co., Hebei Metals and Machinery Import & Export Corp., Shanxi Machinery and Equipment Import & Export Corp., China North Industries Corp. (Guangzhou), China North Industries Corp. (Dalian), Jilin Provincial Machinery and Equipment Import & Export Corp., Xu Zhou Yunhe (Canal) Machinery, Longjing Walking Tractor Works Foreign Trade Import & Export Corp., Changzhi Automotive Parts Factory, Zibo Botai Manufacturing Co., Ltd., and Southwest Technical Import & Export Corp., Defendant-Intervenors.
CourtU.S. Court of International Trade

Porter, Wright, Morris, Arthur (Leslie Alan Glick) Washington, DC, for plaintiff.

David Ogden, Assistant Attorney General, Washington, DC; David M. Cohen, Director, Lucius Lau, Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, Washington, DC, and Linda S. Chang, Attorney of Counsel, Office of the Chief Counsel, for Import Administration, U.S. Department of Commerce.

White & Case (William J. Clinton and Adams Lee), Washington, DC, for defendant-intervenors.

OPINION

PUBLIC VERSION

WALLACH, Judge.

I. INTRODUCTION

[Plaintiff's Motion for Judgment on the Agency Record is denied.]

Plaintiff, The Coalition for the Preservation of American Brake Drum and Rotor Aftermarket Manufacturers (the "Coalition"),1 brings this action pursuant to Rule 56.2 of the Rules of this Court for judgment on the agency record. Plaintiff contests certain aspects of the Department of Commerce, International Trade Administration's ("ITA" or "Commerce") final results entitled Notice of Final Determinations of Sales at Less Than Fair Value: Brake Drums and Brake Rotors from the People's Republic of China, 62 Fed.Reg. 9160 (1997) ("Final Determinations") and the final amended determinations entitled Notice of Amended Final Determinations of Sales at Less Than Fair Value: Brake Drums and Brake Rotors from the People's Republic of China, 62 Fed.Reg. 15,655 (1997). The period of investigation ("POI") covered each exporter's two most recent fiscal quarters prior to the filing of Plaintiff's petition. Final Determinations at 9161.2 For Respondent Southwest Import & Export Corp. ("Southwest"), the POI is June 1995 through December 1995. Id. For all other Respondents, the POI is July 1995 through December 1995.3 Id.

The Court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (1994).

II. BACKGROUND

On March 7, 1996, Plaintiff filed an antidumping petition with the ITA and the United States International Trade Commission ("ITC" or "Commission") requesting the initiation of an antidumping investigation on certain brake drums and rotors from the People's Republic of China ("PRC" or "China"). On April 3, 1996, the ITA published its notice of initiation of antidumping investigations of brake drums and rotors from China. Initiation of Antidumping Duty Investigations: Certain Brake Drums and Certain Brake Rotors from the People's Republic of China, 61 Fed.Reg. 14,740 (1996).

On October 10, 1996, Commerce published its preliminary determinations of sales at less-than-fair value ("LTFV"). Notice of Preliminary Determinations of Sales at Less Than Fair Value and Postponement of Final Determinations: Brake Drums and Brake Rotors from the People's Republic of China, 61 Fed.Reg. 53,190 (1996) ("Preliminary Determinations"). On February 28, 1997, Commerce published its final affirmative determinations of sales at LTFV for both brake drums and rotors. Final Determinations.

On April 16, 1997, the ITC issued its decision finding that a United States industry was not being materially injured or threatened with material injury by reason of imports of certain brake drums from China. In contrast, the Commission made an affirmative injury determination concerning certain brake rotors. See Certain Brake Drums and Rotors From China, 62 Fed.Reg. 8,650 (1997).4

On May 16, 1997, Plaintiff filed two summonses in this Court contesting some aspects of Commerce's affirmative LTFV determinations as to brake drums (Court No. 97-05-00874) and brake rotors (Court No. 97-05-00875).5 Specifically, Plaintiff claimed that Commerce erred in its: 1) decision not to apply "facts available" to all Respondents; 2) solicitation and reliance on publicly available information from the Respondents; 3) rejection of part of Plaintiff's administrative case brief; 4) determination to apply separate rates for selected Respondents; 5) assignment of averaged selected Respondents' rates to non-selected Respondents; 6) critical circumstances determination with regards to non-selected Respondents; 7) rejection of Indian surrogate values from Shivaji Works Limited ("Shivaji"); and 8) use of an Indian surrogate value from Jayaswals Neco Limited ("Jayaswals") for castings for Respondent and selection of surrogate values for various other factors of production.

III. DISCUSSION
A.

The Standard of Review For ITA Determinations Requires Affirmation Unless A Determination Is Unsupported By Substantial Record Evidence Or Otherwise Not In Accordance With Law.

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) (1994). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Consolidated Edison Co. of New York Inc. v. N.L.R.B., 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938).

B.

Commerce's Determination To Rely On Respondents' Reported Information Instead Of Facts Otherwise Available Is Supported by Substantial Evidence.

Pursuant to 19 U.S.C. § 1677e(a) (1994) Commerce is required to use facts otherwise available6 if necessary information is not available on the record, or:

(2) an interested party or any other person —

(A) withholds information that has been requested by the administering authority or the Commission under this subtitle,

(B) fails to provide such information by the deadlines for submission of the information or in the form and manner requested, subject to subsections (c)(1) and (e) of section 1677m of this title,

(C) significantly impedes a proceeding under this subtitle, or

(D) provides such information but the information cannot be verified as provided in section 1677m(i) of this title.7

Section 1677e(a) additionally provides that the use of facts available shall be subject to the limitations set forth in 19 U.S.C. § 1677m(d) (1994). 19 U.S.C. § 1677e(a) (1994). Section 1677m(d) provides that if Commerce:

determines that a response to a request for information under this subtitle does not comply with the request, [Commerce] ... shall promptly inform the person submitting the response of the nature of the deficiency and shall, to the extent practicable, provide that person with an opportunity to remedy or explain the deficiency in light of the time limits established for the completion of investigations or reviews under this subtitle. If that person submits further information in response to such deficiency and either —

(1) the [Commerce] finds that such response is not satisfactory, or

(2) such response is not submitted within the applicable time limits,

then [Commerce] may, ... disregard all or part of the original and subsequent responses.

This statute "is designed to prevent the unrestrained use of facts available as to a firm which makes its best effort to cooperate with the Department [of Commerce]. This section was enacted, as part of the URAA, Pub.L. 103-465 § 231, to implement portions of Annex II to the AD Agreement,8 which provides, in part, that information which `may not be ideal' should not be disregarded if the party `has acted to the best of its ability.'" Borden Inc. v. United States, 4 F.Supp.2d 1221, 1245 (CIT 1998).9

If Commerce determines that use of facts available is warranted, Section 1677e(b) permits an adverse inference if Commerce can make an additional finding that "an interested party has failed to cooperate by not acting to the best of its ability to comply with a request for information." 19 U.S.C. § 1677e(b) (1994).

In this case, after the ITA issued questionnaires, the investigated Respondents10 submitted responses, some of which were later found to contain errors and omissions. Commerce, in accordance with 19 U.S.C. § 1677m(d) (1994), allowed these Respondents to correct and supplement these errors before and during verification. Consequently, Commerce relied on this information, having found that the "revisions were not unduly extensive" and that there was "no basis to conclude that these errors affect the overall integrity of the response." Final Determinations at 9167.

Plaintiff initially argues that the ITA improperly allowed these Respondents to submit revisions and corrections to their questionnaire responses. See Memorandum of Law in Support of Plaintiff's Rule 56.2 Motion For Judgment Upon The Agency Record ("Plaintiff's Brief") at 4-12. Additionally, Plaintiff alleges that Commerce should have rejected these Respondents' data and applied "facts otherwise available" or the China-wide rate to calculate Respondents' margin. Id....

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