7 F.Supp.3d 1338 (CIT. 2014), 13-00229, DuPont Teijin Films China Ltd. v. United States

Docket NºConsol. Court 13-00229
Citation7 F.Supp.3d 1338
Opinion JudgeRestani, Judge
Party NameDUPONT TEIJIN FILMS CHINA LIMITED, DUPONT HONGJI FILMS FOSHAN CO., LTD., DUPONT TEIJIN HONGJI FILMS NINGBO CO., LTD., and DUPONT TEIJIN FILMS U.S. LIMITED PARTNERSHIP, Plaintiffs, v. UNITED STATES, Defendant, TIANJIN WANHUA CO., LTD., Consolidated Plaintiff, TERPHANE, INC., MITSUBISHI POLYESTER FILM, INC., and SKC, INC., Defendant-Intervenors
AttorneyConsol. Court No. 13-00229 John D. Greenwald and Jonathan M. Zielinski, Cassidy Levy Kent (USA) LLP, of Washington, DC, argued for plaintiffs. With them on the brief were Robert C. Cassidy and Thomas M. Beline. David J. Craven, Riggle & Craven, of Chicago, IL, argued for plaintiff-intervenor. Wit...
Judge PanelBefore: Jane A. Restani, Judge.
Case DateSeptember 11, 2014
CourtUnited States Customs Court

Page 1338

7 F.Supp.3d 1338 (CIT. 2014)

DUPONT TEIJIN FILMS CHINA LIMITED, DUPONT HONGJI FILMS FOSHAN CO., LTD., DUPONT TEIJIN HONGJI FILMS NINGBO CO., LTD., and DUPONT TEIJIN FILMS U.S. LIMITED PARTNERSHIP, Plaintiffs,

TIANJIN WANHUA CO., LTD., Consolidated Plaintiff,

v.

UNITED STATES, Defendant,

TERPHANE, INC., MITSUBISHI POLYESTER FILM, INC., and SKC, INC., Defendant-Intervenors

Consol. Court No. 13-00229

United States Court of International Trade

September 11, 2014

Page 1339

[Copyrighted Material Omitted]

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[Copyrighted Material Omitted]

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Motion for judgment on the agency record in antidumping administrative review granted regarding valuation of recycled input and brokerage and handling expenses; Commerce's final results in all other respects sustained.

John D. Greenwald and Jonathan M. Zielinski, Cassidy Levy Kent (USA) LLP, of Washington, DC, argued for plaintiffs. With them on the brief were Robert C. Cassidy and Thomas M. Beline.

David J. Craven, Riggle & Craven, of Chicago, IL, argued for plaintiff-intervenor. With him on the brief were David A. Riggle and Saichang Xu.

Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With her on the brief were Stuart F. Delery, Assistant Attorney General, Jeanne E. Davidson, Director, and Carrie A. Dunsmore, Trial Attorney. Of counsel on the brief was Michael T. Gagain, Attorney, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC.

Before: Jane A. Restani, Judge.

OPINION

Page 1342

Restani, Judge

This matter is before the court on the motions for judgment on the agency record pursuant to USCIT Rule 56.2 filed by plaintiffs DuPont Teijin Films China Limited, DuPont Hongji Films Foshan Co., Ltd., DuPont Teijin Hongji Films Ningbo Co., Ltd., and DuPont Teijin Films U.S. Limited Partnership (collectively " DuPont" ) and consolidated plaintiff Tianjin Wanhua Co., Ltd. (" Wanhua" ). DuPont and Wahua challenge various aspects of the Department of Commerce's (" Commerce" ) final results in the third antidumping duty administrative review of polyethylene terephthalate film, sheet, and strip (" PET film" ) from the People's Republic of China (" PRC" ). See Polyethylene Terephthalate Film, Sheet, and Strip from the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2010-2011, 78 Fed. Reg. 35,245 (Dep't Commerce June 12, 2013) (" Final Results" ). DuPont contends that Commerce erred in calculating its dumping margin, alleging that Commerce misvalued DuPont's recycled PET chips, indirect selling expenses, and brokerage and handling expenses. Mem. of Points and Auths. in Supp. of Pls.' Mot. for J. on the Agency R., ECF No. 46-2 (" DuPont Br." ). Wanhua challenges Commerce's selection of mandatory respondents, which did not include Wanhua, and Commerce's decision to assign DuPont's rate to Wanhua. Mem. in Supp. of Mot. of Consol. Pl. Tianjin Wanhua Co., Ltd. for J. on the Agency R., ECF No. 48-1 (" Wanhua Br." ). DuPont and Wanhua also challenge Commerce's use of the targeted dumping analysis in administrative reviews. DuPont Br. 1-2 n.2; Wanhua Br. 15-19. Defendant United States (" the government" ) argues that the Final Results are based on substantial evidence and are in accordance with law. Def.'s Resp. in Opp. to Mots. for J. upon the Admin. R., ECF No. 57 (" Gov. Br." ). For the reasons stated below, the court

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remands in part and sustains in part the Final Results.

INTRODUCTION

Commerce published an anitdumping duty order covering PET film from the PRC on November 10, 2008. Polyethylene Terephthalate Film, Sheet, and Strip from Brazil, the People's Republic of China and the United Arab Emirates: Antidumping Duty Orders and Amended Final Determination of Sales at Less than Fair Value for the United Arab Emirates, 73 Fed. Reg. 66,595 (Dep't Commerce Nov. 10, 2008). Following requests from several interested parties, Commerce initiated an administrative review of that order on December 23, 2011, covering the period of November 1, 2010, through October 31, 2011. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 76 Fed. Reg. 82,268, 82,269, 82,273 (Dec. 30, 2011). On February 8, 2012, Commerce selected as mandatory respondents the two largest exporters by volume, DuPont and Shaoxing Xiangyu Green Packing Co., Ltd. (" Green Packing" ).1 Memorandum Pertaining to Respondent Selection at 7, PD 35 (Feb. 8, 2012) (" Respondent Selection Memo" ). In determining the largest exporters by volume, Commerce relied on data from U.S. Customs and Border Protection (" CBP" ) and voluntarily submitted quantity and value (" Q& V" ) data from several companies that Commerce found rebutted the CBP data as it pertained to those companies. Respondent Selection Memo at 5-6.

Before the agency, disputes arose over the valuation of DuPont's reprocessed waste PET film that was reintroduced into the production process (" recylced PET chips" ), the calculation of DuPont's indirect selling expenses, the calculation of DuPont's brokerage and handling (" B& H" ) expenses, and Commerce's use of the so-called " targeted dumping" methodology, among other issues. Issues and Decision Memorandum for the Final Results of the 2010-2011 Administrative Review at 18-33, A-570-924 (June 5, 2013), available at http://enforcement.trade.gov/frn/summary/prc/2013-13985-1.pdf (last visited Sept. 3, 2014) (" I& D Memo" ). Wanhua also argued that it should have been chosen as a mandatory respondent and given its own rate. See id. at 3-8. In the Final Results, Commerce calculated a weighted average dumping margin of 0.00% for Green Packing and 12.80% for DuPont. Final Results, 78 Fed. Reg. at 35,247. In calculating the margin for cooperative separate rate respondents not selected for individual review, including Wanhua, Commerce relied on the margin calculated for DuPont, because it was the only rate for a mandatory respondent that was not zero or de minimis. I& D Memo at 8. Wanhua thus received DuPont's rate of 12.80%. See Final Results, 78 Fed. Reg. at 35,247.

DuPont challenges three aspects of the Final Results: 1) Commerce's decision to value DuPont's recycled PET chips the same as its virgin PET chips without providing any by-product offset was arbitrary and unsupported by substantial evidence; 2) Commerce's rejection of DuPont's proposed indirect selling expense ratio was unsupported by evidence and not in accordance with law; and 3) Commerce erred in

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calculating DuPont's B& H expenses by relying on data that was not the most contemporaneous data on the record, including expenses for two documents that DuPont generates internally, and failing to segregate shipping costs into per-container and per-shipment costs. DuPont Br. 10-33. DuPont also adopts Wanhua's challenge to Commerce's use of the targeted dumping analysis in administrative reviews. Id at 1-2 n.2; Wanhua Br. 15-19.

Wanhua raises three challenges to Commerce's mandatory selection process: 1) Commerce lacked the authority under 19 U.S.C. § 1677m(a) to limit the number of mandatory respondents in this case because the number of respondents was not " large," 2 and thus all respondents should have been reviewed; 2) Commerce acted arbitrarily and unreasonably in relying on inconsistent data in selecting the mandatory respondents, namely by relying on a mix of CBP data and voluntary Q& V data, when Commerce should have relied on a single data source to make this determination; 3) Wanhua should have been selected as a mandatory respondent in lieu of, or in addition to, DuPont because DuPont's margin was not representative of Wanhua's rate, as DuPont's margin was subject to manipulation by a U.S. producer of PET film and DuPont sold certain quantities of PET film in the U.S. after further manufacturing. Wanhua Br. 6-12. Wanhua also makes a more general argument that it was unfair and unreasonable for Commerce to assign DuPont's rate to Wanhua because the potential manipulation of DuPont's margin and DuPont's further manufacturing activities rendered DuPont's rate unrepresentative of Wanhua's commercial reality. Id. at 12-14. Finally, should the court reject its arguments that it should receive its own rate, Wanhua argues that it should be given DuPont's corrected rate if DuPont is successful on any of its challenges. Id. at 15.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (2012). " 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).

DISCUSSION

I. Recycled PET Chips Valuation

A. Background

The PRC is considered by Commerce to be a non-market economy 3 (" NME" ). In

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NME antidumping 4 duty cases, Commerce " shall determine the normal value of the subject merchandise on the basis of the value of the factors of production utilized in producing the merchandise." 19 U.S.C. § 1677b(c)(1). In calculating normal value, " the valuation of the factors of production shall be based on the best available information regarding the values of such factors in a market economy country or countries considered to be appropriate by the administering authority." Id. These surrogate values are to be based, " to the extent possible," upon data from an economically comparable country that is a " significant producer[] of comparable merchandise." Id. § 1677b(c)(4). The surrogate values at issue in this case were used to compute DuPont's normal...

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22 practice notes
  • 182 F.Supp.3d 1316 (CIT. 2016), 14-00224, Seah Steel Vina Corp. v. United States
    • United States
    • Federal Cases United States District Court, Federal Circuit
    • August 31, 2016
    ...will incur higher processing costs." Id. at 1295; see also Dupont Teijin Films China v. United States, 38 C.I.T. __, __, 7 F.Supp.3d 1338, 1350-52 (2014) (remanding for Commerce to explain or change its conclusion that customs clearance fees and document prepar......
  • Seah Steel Vina Corp. v. United States, 083116 USCIT, 14-00224
    • United States
    • Federal Cases United States Customs Court
    • August 31, 2016
    ...J. on Agency R. 15, ECF. No. 64 (alteration omitted) (citing DuPont Teijin Films China Ltd. v. United States, 38 CIT __, __, 7 F.Supp.3d 1338, 1350 (2014); Since Hardware (Guangzhou) Co. v. United States, 37 CIT __, __, 911 F.Supp.2d 1362, 1378 (2013); Dongguan Sunr......
  • 461 F.Supp.3d 1336 (CIT 2020), 17-00091, Nexteel Co., Ltd. v. United States
    • United States
    • Federal Cases United States District Court, Federal Circuit
    • June 17, 2020
    ...and will not be considered by a court on appeal. DuPont Teijin Films China Ltd. v. United States, 38 C.I.T. ___, ___, 7 F.Supp.3d 1338, 1354 (2014) (citations omitted). Parties must raise their issues before Commerce at the time the agency addresses the issue becaus......
  • 180 F.Supp.3d 1305 (CIT. 2016), 15-00179, Shenzhen Xinboda Industrial Co., Ltd. v. United States
    • United States
    • Federal Cases United States District Court, Federal Circuit
    • July 27, 2016
    ...voluntary respondent status in accordance with 19 U.S.C. § 1677m(a). See DuPont Teijin Films China Ltd. v. United States, 7 F.Supp.3d 1338, 1357 (CIT 2014) (" [A] party aggrieved by not being selected as a mandatory respondent must request to be reviewed as voluntar......
  • Request a trial to view additional results
20 cases
  • 182 F.Supp.3d 1316 (CIT. 2016), 14-00224, Seah Steel Vina Corp. v. United States
    • United States
    • Federal Cases United States District Court, Federal Circuit
    • August 31, 2016
    ...will incur higher processing costs." Id. at 1295; see also Dupont Teijin Films China v. United States, 38 C.I.T. __, __, 7 F.Supp.3d 1338, 1350-52 (2014) (remanding for Commerce to explain or change its conclusion that customs clearance fees and document prepar......
  • Seah Steel Vina Corp. v. United States, 083116 USCIT, 14-00224
    • United States
    • Federal Cases Court of International Trade
    • August 31, 2016
    ...J. on Agency R. 15, ECF. No. 64 (alteration omitted) (citing DuPont Teijin Films China Ltd. v. United States, 38 CIT __, __, 7 F.Supp.3d 1338, 1350 (2014); Since Hardware (Guangzhou) Co. v. United States, 37 CIT __, __, 911 F.Supp.2d 1362, 1378 (2013); Dongguan Sunr......
  • 180 F.Supp.3d 1305 (CIT. 2016), 15-00179, Shenzhen Xinboda Industrial Co., Ltd. v. United States
    • United States
    • Federal Cases United States District Court, Federal Circuit
    • July 27, 2016
    ...voluntary respondent status in accordance with 19 U.S.C. § 1677m(a). See DuPont Teijin Films China Ltd. v. United States, 7 F.Supp.3d 1338, 1357 (CIT 2014) (" [A] party aggrieved by not being selected as a mandatory respondent must request to be reviewed as voluntar......
  • Golden Dragon Precise Copper Tube Group, Inc. v. United States, 072116 USCIT, 15-00177
    • United States
    • Federal Cases Court of International Trade
    • July 21, 2016
    ...cost of producing the subject merchandise." DuPont Teijin Films China Ltd. v. United States, 38 CIT____, ____, 7 F.Supp.3d 1338, 1345 (2014), referencing Lasko Metal Prods., Inc. v. United States, 16 CIT 1079, 1081, 810 F.Supp. 314, 316-17 (1992). "Nowhere......
  • Request a trial to view additional results
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