EI DuPont de Nemours & Co., Inc. v. US

• Decision Date: 06 December 1993
• Docket Number: Court No. 91-07-00487. Slip Op. 93-229.
• Citation: 841 F. Supp. 1237,17 CIT 1266
• Parties: E.I. DuPONT de NEMOURS & CO., INC., ICI Americas, Inc., Hoechst Celanese Corporation, Plaintiffs, v. UNITED STATES, Defendant, Cheil Synthetics, Inc., SKC Limited, SKC America, Inc., Defendant-Intervenors.
• Court: U.S. Court of International Trade

841 F. Supp. 1237

17 CIT 1266

E.I. DuPONT de NEMOURS & CO., INC., ICI Americas, Inc., Hoechst Celanese Corporation, Plaintiffs, v. UNITED STATES, Defendant, Cheil Synthetics, Inc., SKC Limited, SKC America, Inc., Defendant-Intervenors.

Court No. 91-07-00487. Slip Op. 93-229.

United States Court of International Trade.

December 6, 1993.

Wilmer, Cutler & Pickering, John D. Greenwald, Stravros J. Lambrinidis, Howrey & Simon, Michael A. Hertzberg, Matthew J. Clark, Paul M. Orbach, for plaintiffs E.I. DuPont de Nemours & Co., Inc., ICI Americas Inc., and Hoechst Celanese Corp.

Frank W. Hunger, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civ. Div., U.S. Dept. of Justice, Michael Kane, Vanessa P. Sciarra, Stephen J. Claeys, of counsel, for Import Admin., defendant.

Akin, Gump, Hauer & Feld, Edith E. Scott, Warren E. Connelly, for defendant-intervenor Cheil Synthetics, Inc.

Donovan Leisure Newton & Irvine, Michael P. House, R. Will Plahert, Raymond Paretzky, for defendant-intervenor SKC Ltd. and SKC America, Inc.

OPINION

MUSGRAVE, Judge.

Confidential material appears in the confidential version of this opinion in brackets and is deleted from the public version of the opinion.

In this action, plaintiffs E.I. DuPont de Nemours & Co., Inc., ICI Americas Inc., and Hoechst Celanese Corporation challenge the final results of the administrative review of antidumping findings announced in two determinations by the International Trade Administration, U.S. Department of Commerce (the "ITA" or the "Department" or "Commerce"): Final Determination of Sales at Less than Fair Value: Polyethylene Terephthalate Film, Sheet, and Strip From the Republic of Korea, 56 Fed.Reg. 16,305-16,317 (April 22, 1991); and Amended Final Determination of Sales at Less than Fair Value: Polyethylene Terephthalate Film, Sheet, and Strip From the Republic of Korea, 56 Fed.Reg. 25,669-25,670 (June 5, 1991).

Plaintiffs have jointly filed briefs on their behalf. Defendant-intervenors SKC Limited, SKC America, Inc., and Cheil Synthetics, Inc. have each filed briefs on their own behalf in opposition to plaintiffs' motions.

BACKGROUND¹

On April 27, 1990, an antidumping petition was filed by E.I. DuPont de Nemours & Company, Inc. concerning imports of polyethylene terephthalate film, sheet, and strip. Polyethelyene Terephthalate film, also known as PET film, is a clear flexible transparent material which is used for, among other things, magnetic recording media, laminations, transparencies, cable sheathing and food packaging. The manufacture of PET film for these purposes also results in the production of an inferior or "off-grade" that is used for other purposes including "shingle-release," an interleaved separator for roofing shingles.

The petition alleged, inter alia, that Korean manufacturers of PET film were selling PET film in the United States at less than fair value and were also selling PET film in their home market at below the cost of production. P.R. Document 1 at 29. On May 24, 1990, Commerce published a notice of its decision to initiate a less-than-fair value investigation of the subject PET film. See 55 Fed.Reg. 21,417. On November 30, 1990, Commerce preliminarily determined that sales of PET film from Korea were being made at less-than-fair value. P.R. Document 229; 55 Fed.Reg. 49,668. On April 22, 1991, the Department published its final determination of sales at less-than-fair value. P.R. Document 308; 56 Fed.Reg. 16,305. An amended final determination in the subject investigation was published on June 5, 1991. 56 Fed.Reg. 25,669. On June 5, 1991, the International Trade Commission ("ITC") reported that imports of PET film were causing material injury to the domestic industry. 56 Fed.Reg. 25,695. On June 5, 1991, Commerce issued an antidumping duty order covering imports of PET film from Korea. 56 Fed.Reg. 25,669. Plaintiffs now allege that the ITA erred in calculating the United States Price ("USP") and Foreign Market Value ("FMV") of PET film imported by defendant-intervenors SKC Limited, SKC America (collectively "SKC"), and Cheil Synthetics, Inc. ("Cheil"). As a result, plaintiffs argue, the final determinations understate the dumping margins for defendant-intervenors.

STANDARD OF REVIEW

In reviewing injury, antidumping, and countervailing duty investigations and determinations, this Court must hold unlawful any determination unsupported by substantial evidence on the record or otherwise not in accordance with law. 19 U.S.C. § 1516a(b)(1)(B) (1982). Substantial evidence "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. Labor Board, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938)). "This is 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. Federal Maritime Comm'n, 383 U.S. 607, 619-20, 86 S.Ct. 1018, 1026-27, 16 L.Ed.2d 131 (1966); See also, Matsushita Electric Industrial Co. v. United States, 750 F.2d 927, 933 (Fed.Cir. 1984). The Court may not substitute its judgment for that of the agency when the choice is between two fairly conflicting views, even though the Court would justifiably have made a different choice had the matter been before it de novo. See American Spring Wire Corp. v. United States, 8 CIT 20, 22, 590 F.Supp. 1273, 1276 (1984) (citing Universal Camera, 340 U.S. at 488, 71 S.Ct. at 464), aff'd sub nom., Armco, Inc. v. United States, 760 F.2d 249 (Fed.Cir.1985).

Moreover, substantial evidence supporting an agency determination must be based on the whole record. See Universal Camera Corp., 340 U.S. 474, 488, 71 S.Ct. 456, 464, 95 L.Ed. 456 (1951). The "whole record" means that the Court must consider both sides of the record. It is not sufficient to examine merely the evidence that sustains the agency's conclusion. Id. In other words, it is not enough that the evidence supporting the agency decision is "substantial" when considered by itself. The substantiality of evidence must take into account whatever in the record fairly detracts from its weight. Universal Camera Corp., 340 U.S. at 478, 488, 71 S.Ct. at 459, 464.

The precise way in which courts review agency findings cannot be imprisoned within any form of words; new formulas attempting to rephrase the old are not likely to be more helpful than the old. There are no talismanic words that can avoid the process of judgment. Universal Camera Corp., 340 U.S. at 489, 71 S.Ct. at 465.

DISCUSSION

1. SKC's And Cheil's Duty Drawback Adjustment Claims

The Court first addresses plaintiffs' argument that the ITA improperly adjusted the USP for Korean drawback allowances for imported raw materials that were exported in finished film. Plaintiffs argue that the allocation of drawback allowances for raw materials was inconsistent with the allocation of costs for raw materials for the same products, and the drawback adjustment frequently exceeded the duties paid.

In response, the ITA points out that during verification, it was able to establish that both SKC and Cheil provided adequate evidence to satisfy the criteria enumerated under 19 U.S.C. § 1677a(d)(1)(B). Therefore, ITA argues that its determination to allow the duty drawback adjustments is supported by substantial evidence and is in accordance with law. Pursuant to 19 U.S.C. § 1677a(d)(1)(B):

(d) Adjustments to purchase price and exporter's sales price. —

The purchase price and the exporter's sales price shall be adjusted by being —

(1) increased by —

(B) the amount of any import duties imposed by the country of exportation which have been rebated, or which have not been collected, by reason of the exportation of the merchandise to the United States;

Accordingly, Commerce must increase USP by the amount of duties that Korea refunded to Cheil and SKC as a result of exportation of merchandise to the United States.

The drawback claim was based on average per pound amounts that apply to all types of film even though materials costs varied among film types. Letter dated October 15, 1990 from Dow, Lohnes & Albertson, C.R. Document 59, Reel 4, at Frame 104; Letter dated October 19, 1990 from Akin, Gump, Strauss, Hauer & Feld, C.R. Document 60, Reel 4, at Frames 142-49. Plaintiffs point out that the claimed duty drawback adjustments for SKC varied by Marsh SKC COP/CV Memorandum, C.R. Document 103, Reel 4, at Frames 1510-11, 1517-18; See Computer Printout of SKC's U.S. Sales, Reel 5 of 6. However, and the applicable Korean duty rate dropped from 15.5% ad valorem to 13.5% ad valorem on January 1, 1990. C.R. Document 59, Reel 4, at Frame 104; C.R. Document 60, Reel 4, at Frames 142-49. As a result, plaintiffs maintain, the duty drawback adjustment frequently

Plaintiffs provide an example of the alleged inconsistency in regard to Cheil with an example. Dividing the drawback amount by the duty rate gives the raw material amount upon which the duty was based. . Plaintiffs refer to these raw materials costs as "the substantial equivalent of the total cost of manufacturing," an "obvious problem." Plaintiffs' Brief In Support For Judgment Upon The Agency Record, at 21-22. Plaintiffs do not, however, indicate what proportion of total cost would typically be raw material cost.

In addition, plaintiffs point out that an ITA accountant who calculated raw material costs "as a check," came up with a figure for the XA-30-C film of See Cheil COP/CV Memorandum, supra note 8, Frame 1468. The Similarly, for the XV-30-C film, the ITA accountant calculated a cost of which would imply a duty drawback adjustment of Id. The ITA allowed a duty drawback adjustment for the XV-30-C film of

In the final determination, the ITA rejected plai...