Kyd Inc v. United States

• Decision Date: 06 May 2010
• Docket Number: Court No. 09-00034.,Slip Op. 10-50.
• Parties: KYD, INC., Plaintiff, v. UNITED STATES, Defendant, and Polyethylene Retail Carrier Bag Committee, Hilex Poly Co., LLC, and Superbag Corporation, Defendant-Intervenors.
• Court: U.S. Court of International Trade

704 F.Supp.2d 1323

KYD, INC., Plaintiff, v. UNITED STATES, Defendant, and Polyethylene Retail Carrier Bag Committee, Hilex Poly Co., LLC, and Superbag Corporation, Defendant-Intervenors.

Slip Op. 10-50.

Court No. 09-00034.

United States Court of

International Trade.

May 6, 2010.

Riggle & Craven (David J. Craven) for Plaintiff KYD, Inc.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Carrie A. Dunsmore and Stephen C. Tosini); and Scott D. McBride, U.S. Department of Commerce, Of Counsel, for Defendant United States.

King & Spalding LLP (Stephen A. Jones and Daniel L. Schneiderman) for Defendant-Intervenors Polyethylene Retail Carrier Bag Committee, Hilex Poly Co., LLC, and Superbag Corporation.

OPINION

WALLACH, Judge.

I INTRODUCTION

As a U.S. importer of merchandise subject to an antidumping duty order, Plaintiff KYD, Inc. (“KYD”) challenges determinations made by the U.S. Department of Commerce (“Commerce”) in the 2006-07 administrative review of that order. See Polyethylene Retail Carrier Bags from Thailand: Final Results and Partial Rescission of Antidumping Duty Administrative Review, 74 Fed.Reg. 2,511, 2,511 (January 15, 2009) (“Final Results”). The court has jurisdiction pursuant to 28 U.S.C. § 1581(c). In moving for judgment on the agency record pursuant to U.S. Court of International Trade (“CIT”) Rule 56.2, KYD argues that the application of adverse inferences with respect to its relevant entries and the selection of a particular antidumping duty rate for those entries are unsupported by substantial evidence on the record and otherwise not in accordance with law. See Motion for Judgment on the Agency Record Pursuant to Rule 56.2 of the Rules of the U.S. Court of International Trade (“KYD's Motion”); Memorandum in Support of Motion for Judgment on the Agency Record Pursuant to Rule 56.2 of the Rules of the U.S. Court of International Trade (“KYD's Brief”).

KYD's Motion is GRANTED to the extent described below. Commerce's determination of the assessment rate for KYD's relevant entries is unsupported by substantial evidence on the record. Commerce determined that assessment rate without regard to the information submitted by KYD even though it made no finding under 19 U.S.C. § 1677e(b) that KYD had failed to cooperate and no finding under 19 U.S.C. § 1677m(e) that it could decline to consider KYD's information. Accordingly, this matter is REMANDED to the agency for action consistent with this opinion.

II BACKGROUND

In 2004, Commerce published an antidumping duty order on certain polyethylene retail carrier bags (“PRCBs”) from Thailand. See Antidumping Duty Order: Polyethylene Retail Carrier Bags from Thailand, 69 Fed.Reg. 48,204 (August 9, 2004) (“AD Order”). Before the third anniversary of the AD Order, Commerce provided notice of the opportunity to request an administrative review for the period of review from August 1, 2006 to July 31, 2007 (“the POR”). See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 72 Fed.Reg. 42,383, 42,383 (August 2, 2007).

During the POR, KYD had imported merchandise subject to the AD Order from King Pac Industrial Co., Ltd. (“King Pac”) and Master Packaging Co., Ltd. (“Master Packaging”).¹ See Memorandum from Barbara E. Tillman, Acting Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Ronald K. Lorentzen, Acting Assistant Secretary for Antidumping and Countervailing Duty Operations, Re: Issues and Decision Memorandum for the Antidumping Duty Administrative Review of Polyethylene Retail Carrier Bags from Thailand for the Period of Review August 1, 2006, through July 31, 2007 (January 7, 2009), 2009 WL 113442 (“Final Results Memo”). KYD and Defendant-Intervenors Polyethylene Retail Carrier Bag Committee, Hilex Poly Co., LLC, and Superbag Corporation requested an administrative review with respect to King Pac. See Letter from David J. Craven, Riggle & Craven, to Carlos M. Gutierrez, Secretary of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand; A-549-821; Request for § 751 Administrative Review of King Pac Industrial Co., Ltd. (August 31, 2007), Public Record (“PR”) 2; Letter from King & Spalding to Carlos M. Gutierrez, Secretary of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand: Request for Administrative Review (August 31, 2007), PR 3 (“Defendant-Intervenors' Review Letter”) at 1. Defendant-Intervenors also requested an administrative review with respect to Master Packaging and three other Thai suppliers of the subject merchandise. See Defendant-Intervenors' Review Letter at 1-2.

Commerce initially selected as mandatory respondents “the three largest exporters/producers of subject merchandise ... to the United States during the POR.” Memorandum from Kristin L. Case, International Trade Compliance Analyst, AD/CVD Operations, Office 5, U.S. Department of Commerce, to Laurie Parkhill, Office Director, AD/CVD Enforcement, Office 5, U.S. Department of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand-Respondent Selection (December 6, 2007), PR 22 (“Respondent Selection Memo”) at 4; Polyethylene Retail Carrier Bags from Thailand: Preliminary Results of Antidumping Duty Administrative Review and Intent to Rescind in Part, 73 Fed.Reg. 52,288, 52,289 (September 9, 2008) (“Preliminary Results”).

KYD actively participated in Commerce's administrative review. KYD notified Commerce that it would “monitor the submission of questionnaire responses” and provide necessary information if any of its suppliers failed to submit an adequate response. Letter from David J. Craven, Riggle & Craven, to Carlos M. Gutierrez, Secretary of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand; A-549-821; Request to Extend Deadline for Submission of Factual Information (December 28, 2007), PR 27 at 2. KYD subsequently submitted information to Commerce “in a form resembling a response to Section C of [Commerce's] standard questionnaire for U.S. sales and included copies of its relevant purchase orders and supplier invoices. Additionally, KYD explained the sales, shipping, and payment terms associated with its purchases.” Preliminary Results, 73 Fed.Reg. at 52,291; see Letter from David J. Craven, Riggle & Craven, to Carlos M. Gutierrez, Secretary of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand; A-549-821; Submission of Certain Factual Information Pursuant to 19 U.S.C. § 1677m (January 25, 2008), Confidential Record (“CR”) 11 (“KYD's Submission”); Letter from David J. Craven, Riggle & Craven, to Carlos M. Gutierrez, Secretary of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand; A-549-821; Submission of Certain Factual Information Pursuant to 19 U.S.C. § 1677m (April 8, 2008), CR 28 (“KYD's Resubmission”).² KYD suggested that Commerce could calculate “a separate assessment rate for imports by KYD” using KYD's information and, as necessary, information provided by those mandatory respondents that had responded to Commerce's requests. KYD's Submission at 3 n. 2, 13; KYD's Resubmission at S-3 n. 2, S-13.

As part of its submission, KYD also provided evidence that King Pac “has apparently arranged for all of its U.S. export business to be supplied by” Master Packaging. KYD's Submission at 4; KYD's Resubmission at S-4.³ Defendant-Intervenors responded that “KYD's submission raises serious new issues which were-from [Defendant-Intervenors'] perspective-entirely unexpected” and urged Commerce to investigate the relationship between King Pac and Master Packaging. Letter from King & Spalding to Carlos M. Gutierrez, Secretary of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand (February 4, 2008), CR 14 at 2. Commerce subsequently added Master Packaging as an additional mandatory respondent. Memo from Richard Rimlinger, Program Manager, AD/CVD Enforcement, Office 5, U.S. Department of Commerce, to Laurie Parkhill, Office Director, AD/CVD Enforcement, Office 5, U.S. Department of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand: Selection of Master Packaging as a Mandatory Respondent (March 27, 2008), PR 79 (“Master Packaging Selection Memo”).⁴

King Pac and Master Packaging did not fully participate in the administrative review. King Pac responded to Commerce's initial request for information but failed to respond to the antidumping questionnaire, even after Commerce notified King Pac that it was extending the deadline for a response. See Letter from Pattida Julsasaksrisakul, Managing Director, King Pac Industrial Co., Ltd. to Office of AD/CVD Operations, U.S. Department of Commerce, Re: Polyethylene Retail Carrier Bags from Thailand (October 19, 2007), PR 11; Preliminary Results, 73 Fed.Reg. at 52,289; Letter from Laurie Parkhill, Office Director, AD/CVD Enforcement, Office 5, U.S. Department of Commerce, to King Pac Industrial Co., Ltd. (January 16, 2008), PR 39 (“Extension Letter”). Master Packaging responded to both the initial request for information and the antidumping questionnaire but failed to respond to a supplemental questionnaire. See Letter from Suthep Dansiriviroj, General Manager, Master Packaging Co., Ltd., to Office of AD/CVD Operations, U.S. Department of Commerce (October 22, 2007), PR 12; Preliminary Results, 73 Fed.Reg. at 52,289-90.

Because King Pac and Master Packaging failed to provide the information that Commerce requested, Commerce preliminarily concluded that the use of facts available was required with respect to each of them. See Preliminary Results, 73 Fed.Reg. at 52,290. Furthermore, because each of these suppliers “failed to cooperate by not acting to the best of its ability,” Commerce preliminarily concluded that “the use of an adverse inference [was]...