Fuwei Films (Shandong) Co. v. United States

• Citation: 34 ITRD 1583,837 F.Supp.2d 1347
• Parties: FUWEI FILMS (SHANDONG) CO., LTD., Plaintiff, v. UNITED STATES, Defendant.
• Decision Date: 01 June 2012
• Court: U.S. Court of International Trade

837 F.Supp.2d 1347

34 ITRD 1583

FUWEI FILMS (SHANDONG) CO., LTD., Plaintiff,

v.UNITED STATES, Defendant.

United States Court of

International Trade.

Slip Op. 12–69.

Court No. 11–00061.

June 1, 2012.

David J. Craven, Riggle & Craven, of Chicago, IL, for Plaintiffs Fuwei Films (Shandong) and Shaoxing Xiangyu Green Packing Co., Ltd.David D'Alessandris, 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 Tony West, Assistant Attorney General, Jeanne E. Davidson, Director and Patricia M. McCarthy, Assistant Director. Of Counsel on the brief was Whitney Rolig, Office of the Chief Counsel for Import Administration, International Trade Administration, Department of Commerce, of Washington, D.C.

Ronald I. Meltzer, Patrick J. McLain, David M. Horn, and Jeffrey I. Kessler, Wilmer, Cutler, Pickering, Hale and Door, LLP, of Washington, DC, for Defendant–Intervenors DuPont Teijin Films, Mitsubishi Polyester Film, Inc., SKC, Inc., and Toray Plastics (America), Inc.

OPINION and ORDER

GORDON, Judge:

This consolidated action involves an administrative review conducted by the U.S. Department of Commerce (“Commerce”) of the antidumping duty order covering Polyethylene Terephthalate (“PET”) Film from the People's Republic of China. See Polyethylene Terephthalate Film from the People's Republic of China, 76 Fed.Reg. 9,753 (Dep't of Commerce Feb. 22, 2011) (“ Final Results ”) and accompanying Issues and Decision Memorandum, A–570–924 (Feb. 14, 2011), available at http:// ia. ita. doc. gov/ frn/ summary/ prc/ 2011– 3909– 1. pdf (last visited June 1, 2012) (“ Decision Memorandum ”). Before the court are motions for judgment on the agency record filed by Fuwei Films (Shandong) Co., Ltd., and Shaoxing Xiangyu Green Packing Co., Ltd. (“Green”), respondents in the administrative proceeding (collectively “Respondents”), and DuPont Teijin Films, Mitsubishi Polyester Film, Inc., SKC, Inc., and Toray Plastics (America), Inc. (collectively “DuPont”), petitioners in the administrative proceeding. The court has jurisdiction pursuant to Section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2006),¹ and 28 U.S.C. § 1581(c) (2006).

Respondents challenge Commerce's (1) surrogate valuation of labor inputs, (2) alleged clerical errors for Green's packing material and per-unit electricity and water, and (3) surrogate valuation of PET chips.² DuPont also challenges the surrogate valuation of Respondents' PET chips. For the reasons set forth below, this matter is remanded to Commerce.

I. Standard of Review

For administrative reviews of antidumping duty orders, the court sustains determinations, findings, or conclusions of the U.S. Department of Commerce 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 describedas “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. 2011). 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.” Edward D. Re, Bernard J. Babb, and Susan M. Koplin, 8 West's Fed. Forms, National Courts § 13342 (2d ed. 2010).

II. Discussion

A. Voluntary Remand

Commerce has requested a voluntary remand to (1) address Respondents' arguments regarding the surrogate value for the labor input, and (2) correct a clerical error in Green's per-unit water and electricity costs, which the court will grant. See SKF USA Inc. v. United States, 254 F.3d 1022, 1029 (Fed.Cir.2001).

B. Green's other Clerical Error Allegation

When calculating Green's packing material expenses for the preliminary results, Commerce included a space between a parenthesis and a slash mark in a line of computer code. Green did not raise this issue in its case brief, nor did Green raise the issue as a clerical error submission following issuance of the Final Results. Green has instead raised this issue for the first time in its opening brief in this action, alleging that the extra space caused an error in the conversion (or non-conversion) of units from tons to kilos.

The extra space actually has no effect whatsoever on the calculation. Defendant explains that the software computes each instruction line as a whole. Def.'s Br. at 16 n. 5, Nov. 30, 2011, ECF No. 55 (quoting SAS Institute, Inc., SAS 9.3 Language Reference: Concepts 21 (Cary, NC SAS Institute, Inc. 2011) (“A blank [space] is not treated as a character in a SAS statement unless it is enclosed in quotation marks ... [t]herefore, you can put multiple blanks any place in a SAS statement where you can put a single blank. It has no effect on the syntax.”)). In its reply brief, Green raises an entirely new argument about an apparently different clerical error affecting the converted or calculated weight of Green's plastic caps. See Respondents' Reply Br. at 11–12, Jan. 4, 2012, ECF No. 58–1 (“Plaintiffs initially believed that this error was reflected in the identified instruction. Apparently it was not.”). The time of one's reply brief, however, is not the opportune moment to figure out the specifics of one's argument, and introduce a brand new theory. See Scheduling Order at 6, July 14, 2011, ECF No. 36 (“The reply brief may not introduce new arguments.”). The court will therefore sustain Commerce's treatment of Green's packing expenses.

C. Surrogate Valuation of PET Chip Inputs

When valuing the factors of production in a non-market economy proceeding, Commerce must use the “best available information” when selecting surrogate data from “one or more” surrogate market economy countries. 19 U.S.C. § 1677b(c)(1), (4). Commerce's regulations provide that surrogate values should “normally” be publicly available and from a single surrogate country. 19 C.F.R. § 351.408(c) (2008). Commerce prefers data that reflects a broad market average, is publicly available, contemporaneous with the period of review, specific to the input in question, and exclusive of taxes on exports. Certain Pneumatic Off–the–Road Tires from the People's Republic of China, 73 Fed.Reg. 40,485 (Dep't of Commerce July 15, 2008) and accompanying Issues and Decision Memorandum cmt. 10 at 26, A–570–912 (July 7, 2008), available at http:// ia. ita. doc. gov/ frn/ summary/ PRC/ E 8– 16156– 1. pdf (last visited this date).

“[T]he process of constructing foreign market value for a producer in a nonmarket economy country [using surrogate values] is difficult and necessarily imprecise.” Nation Ford Chem. Co. v. United States, 166 F.3d 1373, 1377 (Fed.Cir.1999) (citation omitted) (internal quotation marks omitted). Importantly, Commerce's surrogate value decision or data choice is not rendered unreasonable because an alternative inference or conclusion could be drawn from the administrative record. Daewoo Elec. Co. v. Int'l Union of Elec., Elec., Tech., Salaried & Mach. Workers, 6 F.3d 1511, 1520 (Fed.Cir.1993). Rather, the court will upset Commerce's surrogate valuation only if no “reasonable mind could conclude that Commerce chose the best available information.” Zhejiang DunAn Hetian Metal Co. v. United States, 652 F.3d 1333, 1341 (Fed.Cir.2011) (quoting Goldlink Indus. Co. v. United States, 30 CIT 616, 619, 431 F.Supp.2d 1323, 1327 (2006)) (internal quotation marks omitted).

In determining the “best available information” to value Respondents' PET film inputs of bright polyester and master batch (“BP & MB”) PET chips, Commerce needed to determine which provision of the Harmonized Tariff Schedule (“HTS”) of India (the primary surrogate country) best applied to Respondents' BP & MB chips. This was an involved undertaking:

When selecting surrogate values with which to value the FOPs used to produce subject merchandise, the Department is directed to use the “best available information” on the record. See Section 773(c)(1) of the Act. As noted by Petitioners, when selecting surrogate values for use in an NME proceeding, the Department's preference is to use, where possible, a range of publicly available, non-export, tax-exclusive, and product-specific prices for the POR, with each of these factors applied non-hierarchically to the particular case-specific facts and with preference to data from a single surrogate country. In the Preliminary Results, the Department selected a surrogate value based on an eight-digit basket category that was the most specific on record to the input in question. The Department valued PET chips with HTS 3907.60.20, “Polyethylene Terephthalate With Intrinsic Viscosity >= 0.64 Dl/G & the HTS subheading applicable to Respondents' FOPs for PET chips with the intrinsic viscosity meeting this description. However, the Department has reviewed the additional factual information placed on the record by Respo...