Ad Hoc Shrimp Trade Action Com. v. U.S.

• Decision Date: 13 May 2009
• Docket Number: No. 07-00378.,Slip Op. 09-42.,07-00378.
• Citation: 616 F.Supp.2d 1354
• Parties: AD HOC SHRIMP TRADE ACTION COMMITTEE, Plaintiff, v. UNITED STATES, Defendant, and Thai I-Mei Frozen Foods Co., Ltd. et al., Defendant-Intervenors.
• Court: U.S. Court of International Trade

616 F.Supp.2d 1354

AD HOC SHRIMP TRADE ACTION COMMITTEE, Plaintiff, v. UNITED STATES, Defendant, and Thai I-Mei Frozen Foods Co., Ltd. et al., Defendant-Intervenors.

Slip Op. 09-42.

No. 07-00378.

United States Court of International Trade.

May 13, 2009.

Dewey & Leboeuf LLP, Washington, DC (Bradford L. Ward, David A. Bentley, and Nathaniel M. Rickard) for Plaintiff Ad Hoc Shrimp Trade Action Committee.

Steptoe & Johnson LLP, Washington, DC (Eric C. Emerson and Michael T. Gershberg) for Plaintiff Thai I-Mei Frozen Foods Co., Ltd.

Michael F. Hertz, Deputy Assistant Attorney General; Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Stephen C. Tosini); and Matthew D. Walden, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, of Counsel, for Defendant United States.

OPINION

WALLACH, Judge.

I INTRODUCTION

This action arises out of an administrative review of an antidumping order covering certain warmwater shrimp from Thailand conducted by the United States Department of Commerce ("Commerce"). Plaintiffs Ad Hoc Shrimp Trade Action Committee ("Ad Hoc"), an association of domestic producers and processors of warmwater shrimp, and Thai I-Mei Frozen Foods Co., Ltd. ("Thai I-Mei"), an exporter of warmwater shrimp, challenge certain decisions made by Commerce during the course of the administrative review. Ad Hoc contests: (1) Commerce's decision not to apply 19 U.S.C. § 1677b(d) to Thai I-Mei's normal value calculations, (2) Commerce's calculation of Thai I-Mei's constructed export price ("CEP") profit, (3) Commerce's classification of Good Luck Product Co. Ltd.'s ("Good Luck") defective merchandise as an "indirect selling expense," and (4) Commerce's decision not to apply adverse facts available when calculating the dumping margin for Fortune Frozen Foods ("Fortune"). Thai I-Mei contests: (1) Commerce's choice of its constructed value ("CV") methodology as it pertains to the general and administrative ("G & A") expense component, (2) Commerce's calculation of Thai I-Mei's G & A and interest expenses ratios, (3) Commerce's denial of Thai I-Mei's CEP offset, and (4) Commerce's calculation of Thai I-Mei's assessment rate.

This court has jurisdiction under 28 U.S.C. § 1581(c). Because the challenged decisions are supported by substantial evidence and otherwise in accordance with law, Commerce's determination in Certain Frozen Warmwater Shrimp from Thailand: Final Results and Final Partial Rescission of Antidumping Duty Administrative Review, 72 Fed.Reg. 52,065 (September 12, 2007) ("Final Results") is AFFIRMED.

II BACKGROUND

On April 7, 2006, Commerce initiated the first administrative review of an antidumping duty order covering certain frozen warmwater shrimp from Thailand. Notice of Initiation of Administrative Reviews of the Antidumping Duty Orders on Certain Frozen Warmwater Shrimp from Brazil, Ecuador, India and Thailand, 71 Fed Reg. 17,819 (April 7, 2006). The period of review was from August 4, 2004 to January 31, 2006. Id. Commerce selected as mandatory respondents the three largest Thai exporters of frozen warmwater shrimp in the respondent selection poll: Good Luck, Thai I-Mei, and Pakfood Public Co., Ltd, ("Pakfood"). Memorandum from Irene D. Tzafolias, Acting Director, Office AD/CVD Operations, to Stephen J. Claeys, Deputy Assistant Secretary for Import Administration, U.S. Department of Commerce, Re: Antidumping Duty Administrative Review of Certain Frozen Warmwater Shrimp from Thailand: Selection of Respondents (July 11, 2006), Public Record ("P.R.") 239, at 6.

On March 9, 2007, Commerce published its preliminary results in the Federal Register. See Certain Frozen Warmwater Shrimp from Thailand: Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 72 Fed.Reg. 10,669 (March 9, 2007) ("Preliminary Results"). Thereafter, on September 12, 2007, Commerce issued the final results of this review. Final Results, 72 Fed.Reg. 52,065. For the three selected respondents, Commerce found the following dumping margins: 10.75% for Good Luck, 2.58% for Thai I-Mei, and 4.29% for Pakfood. Id. at 52,069. For the fifteen respondents subject to the review who were not selected for examination, Commerce calculated a dumping margin of 4.31%, id.; this rate was based on the weighted average of the margins calculated for the three selected respondents, id. at n. 5. Commerce also applied an adverse facts available ("AFA") margin of 57.64% to six respondents who did not cooperate with Commerce's requests for information. Id. On October 12, 2007, Ad Hoc filed this action under court number 07-00378. On January 4, 2008, Thai I-Mei was admitted as a Defendant-Intervenor in Ad Hoc Shrimp Trade Action Committee v. United States, Court Number 07-00378.¹ Thereafter, on January 11, 2008, the court entered an order consolidating Ad Hoc Shrimp Trade Action Committee v. United States, Court Number 07-00378, and Thai I-Mei Frozen Foods Co., Ltd. v. United States, Court Number 07-00381, under consolidated Court Number 07-00378.²

III STANDARD OF REVIEW

The court must uphold a determination by Commerce resulting from an administrative review of an antidumping duty order unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i); Carpenter Tech. Corp. v. United States, 510 F.3d 1370, 1373 (Fed.Cir.2007).

The substantial evidence test "requires only that there be evidence that a reasonable mind might accept as adequate to support a conclusion." Cleo Inc. v. United States, 501 F.3d 1291, 1296 (Fed.Cir.2007) (citing Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 95 L.Ed. 456 (1951)). Even if it is possible to draw two inconsistent conclusions from the evidence contained in the record, this does not render Commerce's findings unsupported by substantial evidence. Consolo v. Fed. Mar. Comm'n, 383 U.S. 607, 620, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966).

While the court must consider contradictory evidence, "the substantial evidence test does not require that there be an absence of evidence detracting from the agency's conclusion, nor is there an absence of substantial evidence simply because the reviewing court would have reached a different conclusion based on the same record". Cleo, 501 F.3d at 1296 (citing Universal Camera, 340 U.S. at 487-88, 71 S.Ct. 456); see also Am. Silicon Techs. v. United States, 261 F.3d 1371, 1376 (Fed.Cir.2001); U.S. Steel Group v. United States, 96 F.3d 1352, 1357 (Fed.Cir.1996).

To determine whether Commerce's interpretation and application of the antidumping statute at issue "is in accordance with the law," the court must conduct the two-step analysis articulated by the Supreme Court in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). See Pesquera Mares Australes Ltda. v. United States, 266 F.3d 1372, 1382 (Fed.Cir.2001) ("[S]tatutory interpretations articulated by Commerce during its antidumping proceedings are entitled to judicial deference under Chevron."). Under the first step of the Chevron analysis, the court must ascertain "whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress." Wheatland Tube Co. v. United States, 495 F.3d 1355, 1359 (Fed.Cir.2007) (citing Chevron, 467 U.S. at 842-43, 104 S.Ct. 2778).

The court reaches the second step of the Chevron analysis only "if the statute is silent or ambiguous with respect to the specific issue." Id. (citing Chevron, 467 U.S. at 843, 104 S.Ct. 2778). Under this second step, the court must evaluate whether Commerce's interpretation "is based on a permissible construction of the statute." Chevron, 467 U.S. at 843 n. 11, 104 S.Ct. 2778. The agency's construction need not be the only reasonable interpretation or even the most reasonable interpretation. Zenith Radio Corp. v. United States, 437 U.S. 443, 450, 98 S.Ct. 2441, 57 L.Ed.2d 337 (1978). The court must defer to Commerce's reasonable interpretation of a statute even if it might have adopted another interpretation if the question had first arisen in a judicial proceeding. Id. (citations omitted).

IV DISCUSSION

A Legal Framework Of Antidumping

Goods imported into the United States are subject to an antidumping duty if Commerce determines that foreign merchandise is being sold in the United States at "less than its fair value."³ 19 U.S.C § 1673; Ad Hoc Shrimp Trade Action Comm. v. United States, 515 F.3d 1372, 1375 (Fed.Cir.2008). The amount of the antidumping duty reflects the amount by which the home-market price of the foreign like product (the "normal value") exceeds the price charged in the United States (the "export price"). 19 U.S.C. § 1677b(a)(1)(A)-(B). The U.S. price is calculated in one of two ways, as either the export price or the constructed export price, depending on the relationship between the producer or exporter and the U.S. purchaser. 19 U.S.C. § 1677a(a)-(b); Ta Chen Stainless Steel Pipe, Ltd., v. United States, 28 CIT 627, 630, 342 F.Supp.2d 1191, 1194 (2004). The difference between the normal value and the export price or constructed export price is referred to as the "dumping margin." 19 U.S.C. § 1677(35)(A). After an antidumping duty order is issued, the amount of the antidumping duty may be revised in subsequent administrative reviews. 19 U.S.C. § 1675(a)(1)(B).

In a subsequent administrative review, Commerce recalculates the normal value (or constructed value) and the export price (or constructed export price) to establish an updated dumping margin. 19 U.S.C. § 1675(a)(2)(A)(i)-(ii). Because the sale prices used to determine normal value and the U.S. price (whether...