70 F.Supp.3d 1350 (CIT. 2015), 13-00098, Samsung Electronics Co. v. United States

Docket Nº:Consol. Court 13-00098
Citation:70 F.Supp.3d 1350
Opinion Judge:Gordon, Judge:
Party Name:SAMSUNG ELECTRONICS CO., LTD., AND SAMSUNG ELECTRONICS AMERICA, INC., Plaintiffs, v. UNITED STATES, Defendant
Attorney:Consol. Court No. 13-00098 Warren E. Connelly, J. David Park, Jarrod M. Goldfeder, and Phyllis L. Derrick, Akin Gump Strauss Hauer & Feld LLP of Washington D.C. for Plaintiffs Samsung. Electronics Co., Ltd and Samsung Electronics America, Inc. Daniel L. Porter, James P. Durling, Christopher A. Du...
Judge Panel:Before: Leo M. Gordon, Judge.
Case Date:June 12, 2015
Court:Court of International Trade
 
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Page 1350

70 F.Supp.3d 1350 (CIT. 2015)

SAMSUNG ELECTRONICS CO., LTD., AND SAMSUNG ELECTRONICS AMERICA, INC., Plaintiffs,

v.

UNITED STATES, Defendant

Consol. Court No. 13-00098

United States Court of International Trade

June 12, 2015

Page 1351

[Copyrighted Material Omitted]

Page 1352

          Motion for judgment on agency record denied; final determination of sales at less than fair value sustained in part.

          Warren E. Connelly, J. David Park, Jarrod M. Goldfeder, and Phyllis L. Derrick, Akin Gump Strauss Hauer & Feld LLP of Washington D.C. for Plaintiffs Samsung.

         Electronics Co., Ltd and Samsung Electronics America, Inc.

         Daniel L. Porter, James P. Durling, Christopher A. Dunn, Ross E. Bidlingmaier, and Claudia D. Hartleben, Curtis, Mallet-Prevost, Colt & Mosle of Washington, D.C. for Consolidated Plaintiffs LG Electronics, Inc. and LG Electronics USA, Inc.

         Jack A. Levy, Myles S. Getlan, James R. Cannon, Jr. John D. Greenwald, Matthew Frumin, and Thomas M. Beline, Cassidy Levy Kent (USA) LLP of Washington, D.C. for Plaintiff and Defendant-Intervenor Whirlpool Corporation.

         Douglas G. Edelschick, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice of Washington, DC for Defendant United States. With him on the brief were Stuart F. Delery, Assistant Attorney General, Jeanne E. Davidson, Director, Franklin E. White, Jr., Assistant Director. Of counsel on the brief was Joanna V. Theiss, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance for the United States Department of Commerce.

         Before: Leo M. Gordon, Judge.

          OPINION

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          Gordon, Judge:

          This consolidated action involves a U.S. Department of Commerce (" Defendant" or " Commerce" ) final determination in the less than fair value investigation of large residential washers from the Republic of Korea. Large Residential Washers from the Republic of Korea, 77 Fed.Reg. 75,988 (Dep't of Commerce Dec. 26, 2012) (final determ. LTFV investigation) (" Final Results" ); see also Issues and Decision Memorandum for the Antidumping Duty Investigation of Large Residential Washers from the Republic of Korea, A-580-868 (Dep't of Commerce Dec. 26, 2012), available at http://enforcement.trade.gov/frn/summary/korea-south/2012-31104-1.pdf (last visited this date) (" Decision Memorandum" ). Before the court are the motions for judgment on the agency record of Plaintiffs Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. (collectively, " Samsung" ), Consolidated Plaintiffs LG Electronics Inc. and LG Electronics USA, Inc. (collectively, " LG" ), and Consolidated Plaintiff Whirlpool Corporation (" Whirlpool" ). The court has jurisdiction pursuant to Section 516A(a)(2)(B)(i) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(i) (2012),1 and 28 U.S.C. § 1581(c) (2012).

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          This opinion addresses Whirlpool's challenge to the Final Results. See Consol. Pl. Whirlpool's Mot. for J. on the Agency R. 1-50 (Sept. 27, 2013), ECF No. 46 (" Whirlpool Br." ); Def.'s Consol. Resp. to Pls.' Mots. for J. on the Agency R. 51-81 (Feb. 14, 2014), ECF No. 62 (" Def. Resp." ); Consol. Def.-Intervenors LG Elecs., Inc.'s and LG Elecs. USA, Inc.'s Resp. to Whirlpool Corp.'s Br. in Supp. of its Mot. for J. on the Agency R. 2-15 (Mar. 7, 2014), ECF No. 66 (" LG Resp." ); Resp. Br. of Samsung Elecs. Co., Ltd. and Samsung Elecs. Am., Inc., in Opp'n to Whirlpool Corp.'s Rule 56.2 Mot. for J. upon the Agency R. 1-21 (Mar. 10, 2014), ECF No. 70 (" Samsung Resp." ); Reply Br. of Whirlpool Corp. 1-37 (Apr. 21, 2014), ECF No. 83 (" Whirlpool Reply" ).

         Specifically, Whirlpool challenges (1) Commerce's finding that LG was not affiliated to its suppliers; (2) Commerce's finding that LG properly reported all its costs; (3) Commerce's refusal to apply adverse facts available to LG due to LG's rebate reporting; (4) Commerce's sales-below-cost test; (5) Commerce's refusal to apply adverse facts available to Samsung due to an affiliated retailer's failure to cooperate; (6) Commerce's selection of the shipment date rather than the invoice date as the date of sale for certain Samsung transactions; and (7) Commerce's treatment of Samsung's costs related to an unforeseen event as direct warranty expenses rather than a different kind of direct expenses. For the reasons set forth below, the court denies Whirlpool's motion for judgment on the agency record and sustains the Final Results for each of the issues challenged by Whirlpool.

         I. Standard of Review

         The court sustains Commerce's " determinations, findings, or conclusions" unless they are " unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i). More specifically, when reviewing agency determinations, findings, or conclusions for substantial evidence, the court assesses whether the agency action is reasonable given the record as a whole. Nippon Steel Corp. v. United States, 458 F.3d 1345, 1350-51 (Fed. Cir. 2006). Substantial evidence has been described as " such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." DuPont Teijin Films USA v. United States, 407 F.3d 1211, 1215 (Fed. Cir. 2005) (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938)). Substantial evidence has also been described as " something less than the weight of the evidence, and the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence." Consolo v. Fed. Mar. Comm'n, 383 U.S. 607, 620, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966). Fundamentally, though, " substantial evidence" is best understood as a word formula connoting reasonableness review. 3 Charles H. Koch, Jr., Administrative Law and Practice § 9.24[1] (3d ed. 2014). Therefore, when addressing a substantial evidence issue raised by a party, the court analyzes whether the challenged agency action " was reasonable given the circumstances presented by the whole record." 8A West's Fed. Forms, National Courts § 3:6 (5th ed. 2015).

         Separately, the two-step framework provided in Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 842-45, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), governs judicial review of Commerce's interpretation of the antidumping statute. See United States v. Eurodif S.A., 555 U.S. 305, 316, 129 S.Ct. 878, 172 L.Ed.2d 679 (2009) (Commerce's " interpretation governs in the absence of unambiguous

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statutory language to the contrary or unreasonable resolution of language that is ambiguous." ). The court first considers whether Congressional intent on the issue is clear. Dupont, 407 F.3d at 1215. When a " court determines Congress has not directly addressed the precise question at issue, . . . the question for the court is whether the agency's answer is based on a permissible construction of the statute." Chevron, 467 U.S. at 843. Under Chevron's second prong, the court must defer to Commerce's reasonable construction of the statute. See, e.g., Eurodif, 555 U.S. at 316; Union Steel v. United States, 713 F.3d 1101, 1106-10 (Fed.Cir.2013).

         II. Discussion

         Whirlpool makes seven multipart arguments in opposition to the Final Results.

         A. Exhaustion

         As a preliminary matter, Defendant and Samsung both respond that Whirlpool failed to exhaust certain arguments: (1) that Commerce improperly rejected a factual submission and (2) that Samsung was able to compel its affiliate to act on a prior occasion. Whirlpool Br. at 32-36. Defendant and Samsung explain that Whirlpool failed to raise either issue in its administrative case brief. Def. Resp. at 73, 75; Samsung Resp. at 11-14. Defendant also contends that Whirlpool did not raise any of the exceptions to the exhaustion requirement in its opening brief " despite a manifest exhaustion problem." Def. Resp. at 73.

         Whirlpool replies that it preserved its rejected submission argument. Whirlpool Reply at 23-26. Whirlpool explains that it twice attempted to submit the relevant arguments and exhibits, and that Commerce twice issued rejection memoranda outlining the agency's reasoning. Id. at 24. Whirlpool cites to Itochu Bldg. Prods. v. United States, 733 F.3d 1140 (Fed. Cir. 2013), a case that, according to Whirlpool, considered and rejected " almost identical" exhaustion arguments to those Defendant and Samsung raise here. Whirlpool Reply at 25. Whirlpool also argues that " the issue of whether Samsung could compel [its affiliated retailer] was squarely before Commerce" because Whirlpool in its administrative case brief contended that Samsung did not exert " maximum efforts" to compel cooperation. Id. at 22 (quoting Whirlpool Case Brief, 32-42 (Dep't of Commerce Oct. 31, 2012), CD 3122 (" Whirlpool Admin. Br." )).

         The court agrees with Defendant and Samsung that exhaustion is appropriate in these circumstances. When reviewing Commerce's antidumping determinations, the U.S. Court of International Trade is mandated by statute to require exhaustion of administrative remedies " where appropriate." 28 U.S.C. § 2637(d). " This form of non-jurisdictional exhaustion is generally appropriate in the antidumping context because it allows the agency to apply its expertise, rectify administrative mistakes, and compile a record adequate for judicial review-advancing the twin purposes of protecting administrative agency authority and promoting judicial efficiency." Carpenter Tech. Corp. v. United States, 30 CIT 1373, 1374-75, 452 F.Supp.2d 1344, 1346 (2006) (citing Woodford v. Ngo, 548 U.S. 81, 88-90, 126 S.Ct....

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