712 F.Supp.2d 1370 (CIT 2010), 08-00225, Mid Continent Nail Corp. v. United States
|Docket Nº:||Court 08-00225.|
|Citation:||712 F.Supp.2d 1370|
|Opinion Judge:||RESTANI, Chief Judge.|
|Party Name:||MID CONTINENT NAIL CORPORATION, Davis Wire Corporation, Maze Nails (Division of W.H. Maze Company) and Treasure Coast Fasteners, Inc., Plaintiffs, v. UNITED STATES, Defendant, and Illinois Tool Works, Inc. and Paslode Fasteners (Shanghai) Co., Ltd., Defendant-Intervenors. Slip Op. 10-48.|
|Attorney:||Wiley Rein, LLP (Adam Henry Gordon and Maureen Elizabeth Thorson), Washington, DC, for plaintiffs. Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (David F. D'Al...|
|Judge Panel:||Before: Jane A. Restani, Chief Judge.|
|Case Date:||May 04, 2010|
|Court:||Court of International Trade|
[Copyrighted Material Omitted]
This court action challenges the Department of Commerce's (" Commerce" ) final determination rendered in a targeted antidumping duty investigation of certain steel nails from the People's Republic of China (" PRC" ). See Certain Steel Nails from the People's Republic of China: Final Determination of Sales at Less Than Fair Value and Partial Affirmative Determination of Critical Circumstances, 73 Fed.Reg. 33,977 (Dep't Commerce June 16, 2008) (" Final Determination " ). The plaintiffs, Mid Continent Nail Corporation, Davis Wire Corporation, Maze Nails and Treasure Coast Fasteners, Inc., collectively the domestic industry, submitted a motion for judgment on the agency record. For the reasons stated below, the court denies the plaintiffs' motion and grants judgment on the agency record in favor of the United States.
I. Targeted Dumping
Targeted dumping analysis is " an alternative method for determining the existence of margins of dumping in an investigation...." Targeted Dumping in Antidumping Investigations; Request for Comment, 72 Fed.Reg. 60,651, 60,651 (Dep't Commerce Oct. 25, 2007) (" Request for Comment " ). The purpose of this methodology is to enable Commerce to identify dumping when a seller is providing lower prices to only certain United States purchasers " by comparing the weighted average of the normal values to the export prices (or constructed export prices) of individual transactions for comparable merchandise." 19 U.S.C. § 1677f-1(d)(1)(B); see Request for Comment. By contrast, during an ordinary antidumping investigation, Commerce determines " whether the subject merchandise is being sold in the United States at less than fair value ... by comparing the weighted average of the normal values to the weighted average of the export prices (and constructed export prices) for comparable merchandise" or by " comparing the normal values of individual transactions to the export prices (or constructed export prices) of individual transactions for comparable merchandise." 19 U.S.C. § 1677f-1(d)(1)(A).
II. Commerce's Investigation of Certain Steel Nails from the PRC
In May 2007, the plaintiffs filed petitions with Commerce concerning certain steel nails from the PRC.
Certain Steel Nails from the People's Republic of China and the United Arab Emirates: Initiation of Antidumping Duty Investigations, 72 Fed.Reg. 38,816, 38,817 (Dep't Commerce July 16, 2007). In July 2007, Commerce initiated a targeted dumping investigation of certain steel nails from the PRC for the period of April 1, 2006, through March 31, 2007. Id. In September 2007, Commerce selected Illinois Tool Works Inc. and Paslode Fasteners (Shanghai) Co., Ltd. (" Paslode" ) and Xingya Group (" Xingya" ) as the mandatory respondents in the investigation. Certain Steel Nails From the People's Republic of China: Preliminary Determination of Sales at Less Than Fair Value and Partial Affirmative Determination of Critical Circumstances and Postponement of Final Determination, 73 Fed.Reg. 3928, 3930 (Dep't Commerce Jan. 23, 2008) (" Preliminary Determination " ). In December 2007, the plaintiffs submitted an allegation of targeted dumping against Paslode and Xingya. Id. at 3931.
In its Preliminary Determination, published on January 23, 2008, Commerce used the methodology it had accepted in a previous investigation to conclude that targeted dumping had occurred.1 Id. at 3939-40. The following month, Commerce amended its Preliminary Determination to correct significant ministerial errors with respect to the calculation of Paslode's antidumping duty (AD) margin. See Certain Steel Nails From the People's Republic of China: Amended Preliminary Determination of Sales at Less Than Fair Value, 73 Fed.Reg. 7254 (Dep't Commerce Feb. 7, 2008) (" Amended Preliminary Determination " ). In the Amended Preliminary Determination, Commerce calculated an AD margin of 4.70 percent for Paslode whereas Xingya's AD margin remained unchanged at 44.57 percent. Id. at 7255. At that time, however, Commerce stated that it intended to develop a new methodology to assess Paslode and Xingya's alleged targeted dumping and requested comments on the matter. Preliminary Determination, 73 Fed.Reg. at 3939.
On April 21, 2008, Commerce informed the plaintiffs of its new methodology (" the nails test" ) and set a sixteen day deadline for comments.2 (Pls.' Documentary App. Accompanying Mem. of Law in Supp. of Pls.' Rule 56.2 Mot. for J. Upon the Agency R. (" Pls.' App." ) Tab 6-8.) The nails test consists of two stages. Proposed Methodology for Identifying and Analyzing Targeted Dumping in Antidumping Investigations; Request for Comment, 73 Fed.Reg. 26,371, 26,372 (Dep't Commerce May 9, 2008) (" Proposed Methodology " ). The first stage, the " standard deviation test," requires Commerce to calculate a standard deviation for all of the sale prices of an item from a particular exporter. Id. Commerce then must add together the volume for all of the items sold at a price below one standard deviation from the
weighted-average price. Issues and Decision Memorandum at 20. If this combined volume exceeds thirty-three percent of the total volume of sales of that item from the particular exporter, the first stage of the test is satisfied. Id. The second stage of the test, the gap test, is satisfied if the volume of sales that qualify under a price gap comparison 3 exceeds five percent " of the total [volume] of sales of subject merchandise to the allegedly targeted customer." Proposed Methodology, 73 Fed.Reg. at 26,372, amended by Issues and Decision Memorandum at 21 n. 15.
The plaintiffs filed their case brief in response to the nails test on May 7, 2008. ( See Pls.' App. Tab 9.) On May 9, 2008, Commerce published the nails test and provided the public thirty days to comment. Proposed Methodology, 73 Fed.Reg. at 26,372. Commerce subsequently extended this deadline until June 23, 2008. Antidumping Methodologies for Proceedings that Involve Significant Cost Changes Throughout the Period of Investigation (POI)/Period of Review (POR) that May Require Using Shorter Cost Averaging Periods; Request for Comment and Proposed Methodology for Identifying and Analyzing Targeted Dumping in Antidumping Investigations; Request for Comment, 73 Fed.Reg. 32,557, 32,557 (Dep't Commerce June 9, 2008). On June 16, 2008, however, Commerce published its Final Determination, which adopted the nails test, and used it to calculate an AD margin of zero percent for Paslode and 21.24 percent for Xingya. Final Determination, 73 Fed.Reg. at 33,981.
In August 2008, the plaintiffs filed a complaint contesting the Final Determination. In February 2009, the plaintiffs filed a motion for judgment on the agency record pursuant to USCIT Rule 56.2.
STANDARD OF REVIEW
The court has jurisdiction pursuant to 28 U.S.C. § 1581(c). The court will uphold Commerce's final determinations in AD investigations 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).
I. Reasonable Time under 19 U.S.C. § 1677m(g)
The plaintiffs allege that Commerce's actions deprived them of their due process rights under the Fifth Amendment. (Mem. of Law in Supp. of Pls.' Rule...
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