Ams Assocs., Inc. v. United States

• Decision Date: 24 June 2013
• Docket Number: No. 2012–1688.,2012–1688.
• Citation: 719 F.3d 1376
• Parties: AMS ASSOCIATES, INC., (doing business as Shapiro Packaging), Plaintiff–Appellant, v. UNITED STATES, Defendant–Appellee, and Laminated Woven Sacks Committee, Coating Excellence International, LLC, and Polytex Fibers Corporation, Defendants–Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

719 F.3d 1376

AMS ASSOCIATES, INC., (doing business as Shapiro Packaging), Plaintiff–Appellant,

v.UNITED STATES, Defendant–Appellee,andLaminated Woven Sacks Committee, Coating Excellence International, LLC, and Polytex Fibers Corporation, Defendants–Appellees.

No. 2012–1688.

United States Court of Appeals,

Federal Circuit.

June 24, 2013.

Ronald M. Wisla, Kutak Rock LLP, of Washington, DC, argued for plaintiff-appellant. With him on the brief was Lizbeth R. Levinson.

Tara K. Hogan, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, argued for defendant-appellee United States. With her on the brief were Stuart F. Delery, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel on the brief was Rebecca Cantu, Office of the Chief Counsel for Import Administration, United States Department of Commerce, of Washington, DC.

Jeffery B. Denning, King & Spalding, LLP, of Washington, DC, argued for the defendants-appellees Laminated Woven Sacks Committee, et al. With him on the brief was Joseph W. Dorn. Of counsel was Jeffrey Mark Telep.

Before LOURIE, O'MALLEY, and TARANTO, Circuit Judges.

TARANTO, Circuit Judge.

Acting under 19 U.S.C. § 1673 et seq., the United States Department of Commerce found that certain Chinese merchandise was being sold in the United States at less than fair value, and it therefore issued an order imposing an antidumping duty on entries of such merchandise into the United States. The order applied to Zibo Aifudi Plastic Packaging Co., Ltd., a firm making covered merchandise in the People's Republic of China (PRC). As to the amount of the duty, because Aifudi had shown that it was not subject to control by the government of the PRC, Commerce assigned Aifudi a company-specific rate, not the country-wide rate that otherwise applied, as a default, to such merchandise from the PRC.

Later, at Aifudi's request, Commerce initiated a review, under 19 U.S.C. § 1675, of the amount of the anti-dumping duty for a defined period. In that proceeding, Commerce considered Aifudi's eligibility for a company-specific rate for that period. After Commerce published its preliminary results, which were favorable to Aifudi, Aifudi immediately withdrew from the proceeding and removed its confidential information from the record. Commerce then concluded that, because Aifudi had stopped cooperating and removed much record information, the record no longer contained enough verifiable information to prove that Aifudi was not subject to government control. Commerce therefore assigned Aifudi the default PRC-wide rate for the review period.

AMS Associates Inc., an American affiliate of Aifudi's that does business as Shapiro Packaging, appealed Commerce's order to the Court of International Trade, which sustained the application of the PRC-wide rate to Aifudi. Because we conclude that Commerce's decision to apply the PRC-wide rate to Aifudi is supported by substantial evidence and does not violate any law, we affirm.

Background

Shapiro Packaging imports into the United States laminated woven sacks manufactured and exported by Aifudi. Laminated woven sacks are sacks made of plastic strips that are woven together and then laminated so that graphics or letters can be printed on the resulting surface. In August 2008, Commerce found that laminated woven sacks exported from the PRC were being sold in the United States at less than fair market value and issued an antidumping-duty order. Laminated Woven Sacks from the People's Republic of China, 73 Fed.Reg. 45,941 (Dep't of Commerce Aug. 7, 2008) (notice); see19 U.S.C. § 1673. Aifudi participated in the proceeding, submitted information and verified it at Commerce's request, demonstrated that it was not subject to government control, and therefore was assigned a “separate rate” of 64.28 percent, not the default PRC-wide rate. Id. at 45,942;Laminated Woven Sacks from the People's Republic of China, 73 Fed.Reg. 35,647–48 (Dep't of Commerce June 24, 2008) (final determination).

On September 22, 2009, in response to requests from Aifudi and another company, Commerce initiated an administrative review of the order for the period January 31, 2008, through July 31, 2009. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 74 Fed.Reg. 48,224 (Sept. 22, 2009); see19 U.S.C. § 1675. Naming Aifudi a “mandatory respondent,” Commerce sent Aifudi a questionnaire, one section of which, Section A, concerned the respondent company's eligibility for a separate rate. Aifudi submitted public and confidential versions of its Section A responses on October 26, 2009. After realizing that it had omitted the Chinese and English translations of its Business License Application Process and a complete set of its 2006 and 2007 Capital Verification Reports from its initial Section A response, Aifudi submitted public and confidential versions of those documents on November 6, 2009. Commerce then issued a First Supplemental Questionnaire, in part directed to Aifudi's separate-rate eligibility, to which Aifudi submitted public and confidential responses on January 14, 2010. Later in 2010, Aifudi again supplemented its responses to Section A.

On September 13, 2010, Commerce issued its preliminary results. Laminated Woven Sacks from the People's Republic of China, 75 Fed.Reg. 55,568 (Dep't of Commerce Sept. 13, 2010) (prelim. admin. review). It preliminarily found that Aifudi's evidence—which Commerce had not yet verified (as Shapiro Packaging confirmed at oral argument in this court)—demonstrated an absence of control by the PRC's government and entitled Aifudi to a separate rate of only “.68 percent” [ sic ]. Id. at 55,571, 55,573. Seven days later, Aifudi withdrew from the proceeding. In its withdrawal letter, Aifudi asked Commerce to remove from the record, and to destroy, all documents containing its confidential information. Commerce did so. On September 20, 2010, the same day that Aifudi withdrew, Shapiro Packaging entered the proceeding.

Commerce issued the final results of the administrative review on March 18, 2011. Laminated Woven Sacks from the People's Republic of China, 76 Fed.Reg. 14,906 (Dep't of Commerce Mar. 18, 2010) (final admin. review). Commerce found that Aifudi was no longer eligible for a separate rate, “as it ha[d] significantly impeded the Department's ability to conduct [the] proceeding and, by withdrawing from the review, prevented the verification of the information it had earlier provided.” Id. at 14,908. Under 19 U.S.C. § 1677e(a), that finding authorized Commerce, in making its determinations, to rely on “the facts otherwise available,” i.e., the facts available notwithstanding the acts that impeded the proceeding and prevented verification. Commerce concluded that Aifudi's withdrawal from participation and removal of its confidential information meant that Commerce did “not have any record evidence upon which to determine whether Zibo Aifudi [was] eligible for a separate rate for this review period,” so Aifudi would be subjected to the country-wide rate. 76 Fed.Reg. at 14,909.

Commerce then invoked another statutory provision to set the country-wide rate. It found that Aifudi (and therefore the country-wide entity of which it was a part) had “failed to cooperate by not acting to the best of its ability to comply with requests for information.” 76 Fed.Reg. at 14,909. Under 19 U.S.C. § 1677e(b), that finding authorized Commerce to “use an inference that is adverse to the interests of that party in selecting from among the facts otherwise available.” Doing so, Commerce adopted a PRC-wide rate of 91.73 percent. 76 Fed.Reg. at 14,909.

On appeal to the Court of International Trade, Shapiro Packaging argued, among other things, that Commerce had erred in applying the PRC-wide rate of 91.73 percent to Aifudi and requested a remand to Commerce for a “redetermination.” AMS Assocs. v. United States, No. 11–00101, 2012 WL 3065277 (July 27, 2012). The Trade Court, stating that Shapiro Packaging had not “convinced the court that there remain[ed] sufficient information in the record to permit Commerce to determine a separate rate for Aifudi, now that Aifudi's confidential information ha[d] been removed,” sustained Commerce's application of the country-wide rate to Aifudi. Id. at *8. Shapiro Packaging appeals. This court has jurisdiction under 28 U.S.C. § 1295(a)(5).

Discussion

The only issue on appeal is whether Commerce properly found that Aifudi did not carry its burden to establish its entitlement to a separate rate. We must uphold that determination unless it is unsupported by substantial evidence on the record or otherwise not in accordance with law. 19 U.S.C. § 1516a(a)(2)(B)(iii), (b)(1)(B); see Micron Tech., Inc. v. United States, 117 F.3d 1386, 1393 (Fed.Cir.1997). We find neither defect in Commerce's determination.

Commerce presumes that all exporters from the PRC (a designated “nonmarket economy”) are subject to government control and therefore should be subjected to a single country-wide rate for the duties imposed by an antidumping-duty order. See Sigma Corp. v. United States, 117 F.3d 1401, 1405 (Fed.Cir.1997). But Commerce allows the presumption to be overcome. An exporter can affirmatively demonstrate its entitlement to a separate rate by showing the absence of both de jure and de facto government control over its export...