Sigma Corp. v. US

• Decision Date: 08 December 1993
• Docket Number: Court No. 91-02-00154. Slip Op. 93-230.
• Citation: 841 F. Supp. 1255
• Parties: SIGMA CORPORATION, U.V. International, Southern Star, Inc., City Pipe and Foundry, Inc., Long Beach Iron Works, Overseas Trade Corporation, D & L Supply Co., Deeter Foundry, Inc., Alhambra Foundry, Inc., Allegheny Foundry, Co., Bingham & Taylor Division, Virginia Industries Inc., Campbell Foundry Co., Charlotte Pipe & Foundry Co., East Jordan Iron Works, Inc., Lebaron Foundry Inc., Municipal Castings, Inc., Neenah Foundry Co., Opelika Foundry Co., Inc., Pinkerton Foundry Inc., Tyler Pipe Industries Inc., U.S. Foundry & Manufacturing Co. and Vulcan Foundry, Inc., Plaintiffs, v. UNITED STATES, Defendant, D & L Supply Co., Defendant-Intervenor, Deeter Foundry, Inc., et al., Defendants-Intervenors.
• Court: U.S. Court of International Trade

841 F. Supp. 1255

SIGMA CORPORATION, U.V. International, Southern Star, Inc., City Pipe and Foundry, Inc., Long Beach Iron Works, Overseas Trade Corporation, D & L Supply Co., Deeter Foundry, Inc., Alhambra Foundry, Inc., Allegheny Foundry, Co., Bingham & Taylor Division, Virginia Industries Inc., Campbell Foundry Co., Charlotte Pipe & Foundry Co., East Jordan Iron Works, Inc., Lebaron Foundry Inc., Municipal Castings, Inc., Neenah Foundry Co., Opelika Foundry Co., Inc., Pinkerton Foundry Inc., Tyler Pipe Industries Inc., U.S. Foundry & Manufacturing Co. and Vulcan Foundry, Inc., Plaintiffs, v. UNITED STATES, Defendant, D & L Supply Co., Defendant-Intervenor, Deeter Foundry, Inc., et al., Defendants-Intervenors.

Court No. 91-02-00154. Slip Op. 93-230.

United States Court of International Trade.

December 8, 1993.

COPYRIGHT MATERIAL OMITTED

Willkie Farr & Gallagher, Walter J. Spak, Christopher A. Dunn, Theodore C. Whitehouse and Christopher S. Stokes, for plaintiffs Sigma Corp., U.V. Intern., Southern Star, Inc., City Pipe and Foundry, Inc. and Long Beach Iron Works.

Mudge Rose Guthrie Alexander & Ferdon, N. David Palmeter, Jeffrey S. Neeley, Martin J. Lewin, Richard G. King and Renee O'Brien, for plaintiff Overseas Trade Corp.

Whitman & Ransom, Dennis James, Jr. and Kathleen F. Patterson, for plaintiff D & L Supply Co.

Collier, Shannon, Rill & Scott, Paul C. Rosenthal, Mary T. Staley and Robin H. Gilbert, for plaintiffs Deeter Foundry, Inc., Alhambra Foundry, Inc., Allegheny Foundry, Co., Bingham & Taylor Div., Virginia Industries Inc., Campbell Foundry Co., Charlotte Pipe & Foundry Co., East Jordan Iron Works, Inc., Lebaron Foundry Inc., Municipal Castings, Inc., Neenah Foundry Co., Opelika Foundry Co., Inc., Pinkerton Foundry Inc., Tyler Pipe Industries Inc., U.S. Foundry & Mfg. Co. and Vulcan Foundry, Inc.

Frank W. Hunger, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civ. Div., U.S. Dept. of Justice, Velta A. Melnbrencis and Paul Herrup; (Jeffery C. Lowe and Robert J. Heilferty, Attorney-Advisors, Office of the Chief Counsel for Import Admin., U.S. Dept. of Commerce, of counsel), for defendant.

Whitman & Ransom, Dennis James, Jr. and Kathleen F. Patterson, for defendant-intervenor D & L Supply Co.

Collier, Shannon, Rill & Scott, Paul C. Rosenthal, Mary T. Staley and Robin H. Gilbert, for defendant-intervenors Deeter Foundry, Inc., Alhambra Foundry, Inc., Allegheny Foundry, Co., Bingham & Taylor Division, Virginia Industries Inc., Campbell Foundry Co., Charlotte Pipe & Foundry Co., East Jordan Iron Works, Inc., Lebaron Foundry Inc., Municipal Castings, Inc., Neenah Foundry Co., Opelika Foundry Co., Inc., Pinkerton Foundry Inc., Tyler Pipe Industries Inc., U.S. Foundry & Mfg. Co. and Vulcan Foundry, Inc.

OPINION

TSOUCALAS, Judge:

Plaintiffs, Sigma Corporation, et al., move pursuant to Rule 56.1 of the Rules of this Court for judgment on the agency record contesting the Department of Commerce, International Trade Administration's ("Commerce") Final Results in Iron Construction Castings From the People's Republic of China; Final Results of Antidumping Duty Administrative Review ("Final Results"), 56 Fed.Reg. 2,742 (1991).

On May 13, 1985, the Municipal Castings Fair Trade Council ("MCFTC") and fifteen individual United States companies filed a petition with Commerce alleging that imports of iron construction castings were being sold at less than fair value in the United States. Certain Iron Construction Castings From the People's Republic of China; Final Determination of Sales at Less Than Fair Value, 51 Fed.Reg. 9,483 (1986). In response to this petition, Commerce conducted an antidumping investigation which resulted in the issuance of an antidumping duty order on iron construction castings from the People's Republic of China. Antidumping Duty Order, Iron Construction Castings From the People's Republic of China (the PRC), 51 Fed.Reg. 17,222 (1986).

On June 29, 1988, Commerce issued a notice of initiation of an administrative review for the period May 1, 1987 through April 30, 1988. Initiation of Antidumping and Countervailing Duty Administrative Reviews ("1987-88 Initiation"), 53 Fed.Reg. 24,470 (1988). On June 21, 1989, Commerce likewise issued a notice for the period from May 1, 1988 through April 30, 1989. Initiation of Antidumping and Countervailing Duty Administrative Reviews ("1988-89 Initiation"), 54 Fed.Reg. 26,069 (1989). Commerce subsequently consolidated these two reviews and issued its preliminary results on June 5, 1990. Iron Construction Castings From the People's Republic of China; Preliminary Results of Antidumping Duty Administrative Review ("Preliminary Results"), 55 Fed.Reg. 22,939 (1990). The Final Results were issued on January 24, 1991. Final Results, 56 Fed.Reg. at 2,742. Oral Argument was heard in this case on July 20, 1993.

The administrative review at issue in this case covers the periods from May 1, 1987 through April 30, 1988 and May 1, 1988 through April 30, 1989. Id. Specifically, plaintiffs contest Commerce's (1) use of the Philippines as a surrogate country for determining foreign market value; (2) use of Philippine import statistics as a surrogate for imports used in the People's Republic of China; (3) failure to determine whether the construction castings industry is market-oriented; (4) failure to institute reviews for China National Machinery Import and Export Corporation, Liaoning ("MACHIMPEX Liaoning"), and use of "best information available" for MACHIMPEX Liaoning as a non-responsive company for determining foreign market value; (5) setting of one dumping margin for all Chinese companies and failing to give Guangdong Metals and Minerals Import & Export Corporation ("Guangdong Minmetals") a separate company-specific dumping margin; (6) failure to give Guangdong notice or opportunity for comment on Commerce's change from a separate rate in the Preliminary Results to a country-wide rate in the Final Results; (7) adjustments for Guangdong's constructed value for "after sale" warehousing costs; (8) depreciation estimate as the "best information available"; (9) valuation of different material inputs using different valuation sources; (10) failure to include all costs incurred by Chinese producers to manufacture castings specifically with regard to accounting of (a) special features and bolts, (b) labor costs incurred by Chinese producers, and (c) overhead costs; (11) treatment of foreign inland freight costs incurred in transporting material inputs to the foundries; (12) failure to investigate whether Chinese castings producers were reimbursing U.S. importers of Chinese castings for antidumping duties; and (13) various clerical errors including (a) improperly calculating the amount of aluminum consumed in production, (b) the amount of fireclay consumed, and (c) failing to properly calculate the raw material factors that were valued using petitioners' additives and supply data.

Discussion

In reviewing a final determination of Commerce, this Court 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(b)(1)(B) (1988). Substantial evidence has been defined as being "more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 459, 95 L.Ed. 456 (1951) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938)). It is "not within the Court's domain either to weigh the adequate quality or quantity of the evidence for sufficiency or to reject a finding on grounds of a differing interpretation of the record." Timken Co. v. United States, 12 CIT 955, 962, 699 F.Supp. 300, 306 (1988), aff'd, 894 F.2d 385 (Fed.Cir. 1990).

1. Use of Philippines as Surrogate Country

Plaintiffs, Sigma Corporation, U.V. International, Southern Star, Inc., City Pipe and Foundry, Inc. and Long Beach Iron Works ("Sigma"), claim that Commerce's use of the Philippines as the surrogate country for a non-market economy was unsupported by substantial evidence on the record and not in accordance with law. Sigma's Memorandum of Points and Authorities in Support of Plaintiffs' Rule 56.1 Motion for Judgment on the Agency Record ("Sigma's Memorandum") at 5.

Defendant claims that the decision to employ the Philippines as a surrogate country was properly made based on the criteria outlined in the statute and the failure of the parties to provide information establishing that the Philippines was not an appropriate surrogate. Defendant's Memorandum in Opposition to Plaintiffs' Motion for Judgment Upon the Administrative Record ("Defendant's Memorandum") at 47-48.

According to 19 U.S.C. § 1677b(c)(2) (1988 & Supp.1993):

If the administering authority finds that the available information is inadequate for purposes of determining the foreign market value of merchandise ... the administering authority shall determine the foreign market value on the basis of the price at which merchandise that is —

(A) comparable to the merchandise under investigation, and

(B) produced in one or more market economy countries that are at a level of economic development comparable to that of the non-market economy country, whose merchandise

is sold in other countries, including the United States.¹

Thus, in this case the Philippines was chosen as the appropriate surrogate country. Plaintiffs claim that there is no evidence on the record indicating that the Philippines is an appropriate surrogate country and, furthermore, that Commerce did not fully investigate other potential surrogates. Sigma's Memorandum at 5-6. Contrary to plaintiffs' contentions, however, Commerce attempted to identify producers and/or exporters of iron construction castings in several countries including India, Indonesia, Pakistan, the Philippines, ...