Lifestyle Enter., Inc. v. United States

• Decision Date: 05 February 2013
• Docket Number: Court No. 09–00378.,Slip Op. 13–17.
• Citation: 896 F.Supp.2d 1297
• Parties: LIFESTYLE ENTERPRISE, INC., Trade Masters of Texas, Inc., Emerald Home Furnishings, LLC, Ron's Warehouse Furniture d/b/a Vineyard Furniture International LLC, Plaintiffs, and Dream Rooms Furniture (Shanghai) Co., Ltd., Guangdong Yihua Timber Industry Co., Ltd., Consolidated Plaintiffs, Orient International Holding Shanghai Foreign Trade Co., Ltd., Intervenor Plaintiff, v. UNITED STATES, United States Department of Commerce, Defendants, and American Furniture Manufacturers Committee for Legal Trade, Vaughan–Bassett Furniture Company, Inc., Intervenor Defendants.
• Court: U.S. Court of International Trade

896 F.Supp.2d 1297

LIFESTYLE ENTERPRISE, INC., Trade Masters of Texas, Inc., Emerald Home Furnishings, LLC, Ron's Warehouse Furniture d/b/a Vineyard Furniture International LLC, Plaintiffs,

and

Dream Rooms Furniture (Shanghai) Co., Ltd., Guangdong Yihua Timber Industry Co., Ltd., Consolidated Plaintiffs,

Orient International Holding Shanghai Foreign Trade Co., Ltd., Intervenor Plaintiff,

v.UNITED STATES, United States Department of Commerce, Defendants,andAmerican Furniture Manufacturers Committee for Legal Trade, Vaughan–Bassett Furniture Company, Inc., Intervenor Defendants.

Slip Op. 13–17.

Court No. 09–00378.

United States Court of

International Trade.

Feb. 5, 2013.

Kristin H. Mowry, Jeffrey S. Grimson, Jill A. Cramer, Keith F. Huffman, Sarah M. Wyss, and Susan L. Brooks, Mowry & Grimson, PLLC, of Washington, DC, and John D. Greenwald, Cassidy Levy Kent (USA) LLP, of Washington, DC, for plaintiffs.¹

William E. Perry, Garvey Schubert Barer, of Washington, DC, for consolidated plaintiff Dream Rooms Furniture (Shanghai) Co., Ltd.

John D. Greenwald, Cassidy Levy Kent (USA) LLP, of Washington, DC, and Patrick J. McLain, Wilmer, Cutler, Pickering, Hale & Dorr, LLP, of Washington, DC, for consolidated plaintiff Guangdong Yihua Timber Industry Co., Ltd.

Nancy A. Noonan, John M. Gurley, and Matthew L. Kanna, Arent Fox LLP, of Washington, DC, for intervenor plaintiff.

Stuart F. Delery, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, Stephen C. Tosini, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for defendants. Of counsel on the brief was Shana Hofstetter, Attorney, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, for defendants.

J. Michael Taylor, Daniel L. Schneiderman, Joseph W. Dorn, and Prentiss L. Smith, King & Spalding, LLP, of Washington, DC, for intervenor defendants.

OPINION

RESTANI, Judge:

This matter is before the court following three previous remands. See Lifestyle Enter., Inc. v. United States, 865 F.Supp.2d 1284 (CIT 2012) (“LifestyleIII ”); Lifestyle Enter., Inc. v. United States, 844 F.Supp.2d 1283 (CIT 2012) (“LifestyleII ”); Lifestyle Enter., Inc. v. United States, 768 F.Supp.2d 1286 (CIT 2011) (“Lifestyle I ”). These cases involve challenges to the final results of the administrative review of an antidumping (“AD”) order covering wooden bedroom furniture from the People's Republic of China (“PRC”) by the U.S. Department of Commerce (“Commerce”). See Wooden Bedroom Furniture from the People's Republic of China: Final Results of Antidumping Duty Administrative Review and New Shipper Reviews, 74 Fed. Reg. 41,374 (Dep't Commerce Aug. 17, 2009) (“ Final Results ”). The court ordered Commerce to reconsider a variety of issues in its first remand, resulting in Commerce issuing its Final Results of Redetermination Pursuant to Remand (Dep't Commerce Aug. 26, 2011) (Docket No. 132) (“ First Remand Results ”). Because Commerce again failed to support part of its redetermination with substantial evidence, the court remanded two issues back to Commerce. See Lifestyle II, 844 F.Supp.2d at 1298.

Although Commerce complied with the court's directions in the second remand as to the valuation of wood inputs in its AD methodology, Commerce failed to provide substantial evidence to properly corroborate the adverse facts available (“AFA”) rate assigned to Orient International Holding Shanghai Foreign Trade Co., Ltd. (“Orient”). See Lifestyle III, 865 F.Supp.2d at 1291–92, 1294;Final Results of Redetermination Pursuant to Second Remand (Dep't Commerce June 11, 2012) (Docket No. 183) (“ Second Remand Results ”). As a result, the court again remanded this matter to Commerce so that the agency could comply with the court's previous instructions that it select a corroborated AFA rate, which reflects Orient's “commercial reality.” Lifestyle III, 865 F.Supp.2d at 1289–90. On remand, Commerce selected a new rate of 83.55% for Orient using a significant sample of verified sales data from a comparable producer. See Final Results of Redetermination Pursuant to Third Remand (Dep't Commerce Dec. 4, 2012) (Docket No. 208) (“ Third Remand Results ”) at 7. Because Commerce complied with the court's remand instructions and the objections of the intervenor defendants are without merit, the court sustains Commerce's redetermination.

BACKGROUND

The court previously has set out the facts of this case in three previous opinions. See Lifestyle III, 865 F.Supp.2d at 1287–88;Lifestyle II, 844 F.Supp.2d at 1286–87;Lifestyle I, 768 F.Supp.2d at 1293–95. The court, however, summarizes below the facts relevant to this limited remand.

Lifestyle Enterprise, Inc. (“Lifestyle”), Orient, Guangdong Yihua Timber Industry Co., Ltd. (“Yihua Timber”), Dream Rooms Furniture (Shanghai) Co., Ltd., Ron's Warehouse Furniture d/b/a Vineyard Furniture, Emerald Home Furnishings, LLC, and Trade Masters of Texas, Inc. (collectively “plaintiffs”) as well as intervenor defendants American Furniture Manufacturers Committee for Legal Trade and Vaughan–Bassett Furniture Company, Inc. (collectively “AFMC”) challenged the Final Results. All of these challenges were either dismissed or resolved in previous remands with the exception of the challenge to the weighted average dumping margin ² assigned to Orient. See generally id.

In its Final Results, Commerce assigned an AFA rate to Orient of 216.01%, the same rate assigned to the PRC-wide entity. Final Results, 74 Fed. Reg. at 41,380. After the court determined that Commerce lacked substantial evidence to support the rate assigned to Orient and remanded the case, Commerce continued to apply the 216.01% rate to Orient, finding “that the information on the record corroborates the rate of 216.01 percent, as it relates to Orient....” First Remand Results at 31. Commerce corroborated its determination based on sales data provided by Yihua Timber, which showed a small number of sales transactions at or above a 180% margin. Id. at 35–36. The court again found that Commerce failed to support with substantial evidence its selection of a 216.01% rate for Orient. Lifestyle II, 844 F.Supp.2d at 1291.

During the second remand, Commerce calculated a new AFA rate for Orient of 130.81%, relying on a limited set of sales data from Yihua Timber, a cooperating party in the investigation. Second Remand Results at 17. On review, the court found that Commerce lacked substantial evidence to support the new rate in light of both the limited sales data used to corroborate the new rate and the discrepancy between Orient's rate and the rates assigned to other separate-rate entities throughout several segments of the proceedings. Lifestyle III, 865 F.Supp.2d at 1290–92. Accordingly, the court remanded the matter to Commerce again for it to comply with the court's previous instruction “to start with the highest rate calculated for a comparable respondent or respondents and then add an additional amount to ensure compliance.” Id. at 1291 (quoting Lifestyle II, 844 F.Supp.2d at 1291 n. 13) (highlighting the need for additional corroboration where the AFA rate is in multiples of 100%).

In its third redetermination, Commerce assigned Orient an AFA rate of 83.55%. Third Remand Results at 7. AFMC challenges the new rate as too low to provide the deterrent effect intended by the AFA statute and continues to argue for the rate initially set by Commerce in its Final Results. See AFMC's Comments Concerning Commerce's Final Results of Redetermination Pursuant to Third Remand (“AFMC Comments”) at 2. Plaintiffs do not object to the new rate. See Comments of Lifestyle Enterprise, Inc. et al. on Department of Commerce December 6, 2012 Final Results of Redetermination Pursuant to Third Remand. Defendants respond that Commerce has complied with the court's instructions in Lifestyle III and claim that AFMC's proposed rates have either been previously rejected by this court or are no better supported than the rate selected by Commerce. See Def.'s Resp. to AFMC's Remand Comments at 5–6.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to 28 U.S.C. § 1581(c). The court will uphold Commerce's redetermination in an AD review 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)(i).

DISCUSSION

AFMC claims that the new AFA rate selected by Commerce for Orient is “not sufficiently adverse and does not further the purpose of the statutory provision.” AFMC Comments at 2. AFMC instead argues that Commerce should apply the original 216.01% AFA rate, which it contends is corroborated. Id. Even if the previous rate is not supported, AFMC argues that Commerce should have used the single highest non-aberrational transaction-specific margin. ³Id. at 3. AFMC's argument lacks merit.

Where a respondent to an AD investigation fails to cooperate by not providing valid data for Commerce to consider in calculating an AD rate, Commerce may use facts otherwise available to fill the information gap. 19 U.S.C. § 1677e(a). Additionally, if Commerce determines that “an interested party has failed to cooperate by not acting to the best of its ability ...,” Commerce is permitted to use inferences “adverse to the interests of that party in selecting from among the facts otherwise available.” 19 U.S.C. § 1677e(b). When adverse inferences are applied, Commerce may look to information contained in the petition, a final determination in the investigation, any previous review, or any other information placed on the record. Id. In doing so, Commerce may select a rate high enough to deter companies from refusing to cooperate, but the rate may not be so high so as to be punitive. Gallant Ocean (Thai.) Co. v. United States, 602 F.3d 1319, 1323 (Fed.Cir.2010). Accordingly, “Commerce may not select unreasonably high rates...