753 F.Supp.2d 1334 (CIT 2011), 09-00430, Pakfood Public Co. Ltd. v. United States

Docket Nº:Consol.[1] Court 09-00430.
Citation:753 F.Supp.2d 1334
Opinion Judge:POGUE, Chief Judge:
Party Name:PAKFOOD PUBLIC COMPANY LIMITED, et al., Plaintiffs, v. The UNITED STATES, et al., Defendants. Slip Op. 11-6.
Attorney:Trade Pacific PLLC (Robert G. Gosselink and Jonathan M. Freed) for Plaintiffs and Defendant-Intervenors Pakfood Public Co., Ltd.; Asia Pacific (Thailand) Co., Ltd.; Chaophraya Cold Storage Co., Ltd.; Okeanos Co., Ltd.; Okeanos Food Co., Ltd.; and Takzin Samut Co., Ltd. White & Case LLP, Washingto...
Case Date:January 18, 2011
Court:Court of International Trade

Page 1334

753 F.Supp.2d 1334 (CIT 2011)



The UNITED STATES, et al., Defendants.

Slip Op. 11-6.

Consol. 1 Court No. 09-00430.

United States Court of International Trade.

January 18, 2011

Page 1335

[Copyrighted Material Omitted]

Page 1336

Trade Pacific PLLC (Robert G. Gosselink and Jonathan M. Freed) for Plaintiffs and Defendant-Intervenors Pakfood Public Co., Ltd.; Asia Pacific (Thailand) Co., Ltd.; Chaophraya Cold Storage Co., Ltd.; Okeanos Co., Ltd.; Okeanos Food Co., Ltd.; and Takzin Samut Co., Ltd.

White & Case LLP, Washington, DC (Walter J. Spak and Jay C. Campbell) for Consolidated Plaintiffs and Defendant-Intervenors Andaman Seafood Co., Ltd.; Chanthaburi Frozen Food Co., Ltd.; Chanthaburi Seafoods Co., Ltd.; Phatthana Seafood Co., Ltd.; Phatthana Frozen Food Co., Ltd.; Thailand Fishery Cold Storage Public Co., Ltd.; Thai International Seafoods Co., Ltd.; Sea Wealth Frozen Food Co., Ltd.; and Rubicon Resources, LLC.

Akin Gump Strauss Hauer & Feld LLP, Washington, DC (Warren E. Connelly and Jarrod M. Goldfeder) for Consolidated Plaintiffs and Defendant-Intervenors Thai Union Frozen Products Public Co., Ltd. and Thai Union Seafood Co., Ltd.

Picard Kentz & Rowe LLP (Andrew W. Kentz and Nathaniel J. Maandig Rickard) for Consolidated Plaintiff and Defendant-Intervenor Ad Hoc Shrimp Trade Action Committee.

Stewart and Stewart (Geert M. De Prest and Elizabeth J. Drake) and Leake & Andersson, LLP (Edward T. Hayes) for Consolidated Plaintiff-Intervenor and Defendant-Intervenor The Domestic Processors.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director; Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Stephen C. Tosini), and, of counsel, Jonathan M. Zielinski, Attorney, Office of the Chief Counsel for Import Administration, Department of Commerce, for Defendant United States.


POGUE, Chief Judge:

This action is again before the court following a remand to the United States Department of Commerce (" Commerce" or " the Department" ) of the results of an administrative review of an antidumping (" AD" ) duty order.2 The three issues presented are whether, in the selection of respondents in this review, Commerce's use of data obtained from United States Customs and Border Protection (" Customs" or " CBP" ) (A) is arbitrary in light of Commerce's prior and concurrent practice for making such determinations, (B) constitutes a reasonable application of the A.D. statute, and (C) is supported by substantial evidence on the record. The court answers the first question in the negative and latter questions in the affirmative, and therefore affirms the remand results.


A. Pakfood I

The issues presented, and the Department's reliance on CBP data, arose from Commerce's initial indication, in its Notice of Initiation for the instant administrative review, that it intended to exercise its discretion under Section 777A(c)(2) of the

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Tariff Act of 1930, as amended, 19 U.S.C. § 1677f-1(c)(2) (2006),3 to limit the number of respondents selected for individual review.4 Certain Frozen Warmwater Shrimp from Brazil, Ecuador, India, and Thailand, 73 Fed.Reg. 18,754, 18,765 (Dep't Commerce Apr. 7, 2008) (notice of initiation of A.D. reviews) (" Notice of Initiation " ). At the same time, Commerce announced that, " [i]n selecting the respondents for individual review, the Department intends to select respondents based on [CBP] data for U.S. imports during the [POR]," id., and that, in using such data, " [a]bsent information to the contrary," it would continue to treat respondents found to be collapsible into single entities in prior segments of the administration of this A.D. duty order (i.e., the underlying A.D. investigation and prior administrative reviews) as single entities also in this review. Id. at 18,764 nn. *-* * * *.5

After receiving and considering comments from, inter alia, Petitioner, Plaintiff Ad Hoc Shrimp Trade Action Committee (" AHSTAC" ), and two potential respondents, the Department determined that it would limit its examination to the two producer/exporter entities accounting for the largest volume of subject imports during the POR. Resp't Selection Mem. 2-6. The two mandatory respondents were then selected on the basis of CBP data— specifically, data for all entries of merchandise covered by the order during the POR (" CBP data" ) 6— and company affiliations found to exist in prior segments. Id. at 6-7; I & D Mem. Cmt. 2 at 8-10. In Pakfood I, AHSTAC argued, inter alia,

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that Commerce's reliance on CBP data in selecting the mandatory respondents for this review was inconsistent with the prior practice of using information obtained from quantity and value (" Q & V" ) questionnaires, and therefore arbitrary. Pakfood I, 724 F.Supp.2d at 1335. The court agreed.

Specifically, Pakfood I concluded, on the record then before the court, that Commerce, without sufficient explanation, continues to use Q & V questionnaires in some administrative proceedings and to use CBP data in others. Accordingly, the court held that, " [r]egardless of the reasonableness of using CBP entry data to select mandatory respondents, [ ] the Department's apparently arbitrary and inconsistent employment of this methodology is not, without more adequate explanation, consistent with basic principles of the rule of law." Id. at 1337 (citations omitted). The court therefore remanded the issue, instructing the Department to either provide an adequate explanation for its apparent methodological inconsistency, or else apply a methodology consistent with that applied in like circumstances. Id. at 1338.

B. Remand Results

In its Final Results Pursuant to Court Remand, the Department reiterates its position that, while it has used Q & V questionnaires to select mandatory respondents in past administrative proceedings, " ‘ the Department's current practice is to select respondents using CBP data....’ " Final Results Pursuant to Court Remand (Oct. 29, 2010), Remand Admin. R. Pub. Doc. 5 (" Remand Results " ) at 3 (quoting I & D Mem. Cmt. 2 at 9-10 (citations omitted)). The agency explains its change in practice as necessary " to improve the efficiency of the respondent selection process." Id. at 4.7

In the Remand Results, Commerce also explains apparent inconsistencies in applying this methodology 8— identified by the court in Pakfood I, 724 F.Supp.2d at 1335-369— as exceptions to its regular practice. Remand Results 5-7 (distinguishing reviews where " the Department explained

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that, while its practice is to use CBP data for respondent selection, the CBP data for the particular merchandise covered by those reviews w[ere] not adequate for selecting respondents in those reviews," and explaining that, " [i]n arriving at these conclusions, the Department drew from its expertise and knowledge of the industry derived from previous segments of the proceedings in question" ). ( See also Def.'s Resp. to Ad Hoc's Remand Comments) (" Def.'s Br." ) 3 (" Commerce's practice is to rely upon CBP data unless those data are unusable. The cases in which Commerce has issued [Q & V] questionnaires involved determinations that CBP data were unusable." (citing Remand Results 3-5).)

Specifically, the Department points to certain circumstances, not evidenced in the instant review, which may render reliance on CBP data inappropriate. Such circumstances may consist of industry-specific characteristics, such as a significant volume of resold merchandise, unique cash-deposit structures, and/or A.D. duty orders whose scope includes parts of merchandise as well as the finished products.10 Further exceptional circumstances, again not evidenced here, include situations where " the units used to measure import quantities [in CBP data] are not consistent for the [tariff code] categories identified in the [ ] scope [of the relevant A.D. duty order]" 11; where " CBP volume data do not account for [significant]

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differences in [merchandise] size and weight [relevant to the scope of the A.D. duty order at issue]" 12; or where the Department specifically determines that " a significant amount of the volume in the CBP data [is] unclear." 13

In the instant review, by contrast, Commerce contends that " the Department's analysis of the CBP data, supported by the Department's experience in conducting three previous segments of the proceeding, demonstrated that the CBP data for entries of shrimp from Thailand during the POR were adequate, appropriate, and reliable for purposes of determining the largest exporters of subject merchandise, and thus selecting mandatory respondents." Remand Results at 7-8 (footnote omitted).14

C. AHSTAC's Comments on the Remand Results

AHSTAC, the sole party now challenging the Remand Results, 15 argues that Commerce's process for selecting mandatory respondents in this review (A) remains an arbitrary departure from prior practice, (B) is in any case contrary to law 16— because CBP data do not provide

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sufficient information regarding exporters of subject merchandise— and (C) is unsupported by substantial evidence on the record of this review.17 ( See generally Pl.'s Comments on Final Results of Redetermination Pursuant to Ct. Remand (" AHSTAC's Br." ).18)

After summarizing the applicable standard of review, the court will consider, in turn, each of AHSTAC's challenges to the Remand Results.


As is always the case, the issues presented here are necessarily framed by the court's standard of review. Specifically, " [t]he court will sustain the...

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