Hitachi Metals, Ltd. v. United States

• Decision Date: 07 February 2020
• Docket Number: 2019-1289
• Citation: 949 F.3d 710
• Parties: HITACHI METALS, LTD., Hitachi Metals America LLC, Plaintiffs-Appellants Daido Steel Co., Ltd., Plaintiff v. UNITED STATES, Arcelormittal USA LLC, Nucor Corporation, Defendants-Appellees
• Court: U.S. Court of Appeals — Federal Circuit

949 F.3d 710

HITACHI METALS, LTD., Hitachi Metals America LLC, Plaintiffs-AppellantsDaido Steel Co., Ltd., Plaintiff

v.UNITED STATES, Arcelormittal USA LLC, Nucor Corporation, Defendants-Appellees

2019-1289

United States Court of Appeals, Federal Circuit.

Decided: February 7, 2020

Daniel Cannistra, Crowell & Moring, LLP, Washington, DC, argued for plaintiffs-appellants. Also represented by Robert L. Lafrankie, Pierce Lee.

Brian Russell Soiset, Office of General Counsel, United States International Trade Commission, Washington, DC, argued for defendant-appellee United States. Also represented by Andrea C. Casson, Dominic L. Bianchi.

Brooke Michelle Ringel, Kelley Drye & Warren, LLP, Washington, DC, argued for defendant-appellees Arcelormittal USA LLC, Nucor Corporation. Defendant-appellee Arcelormittal USA LLC also represented by Kathleen Cannon, Robert Alan Luberda, Paul C. Rosenthal.

Alan H. Price, Wiley Rein, LLP, Washington, DC, for defendant-appellee Nucor Corporation. Also represented by Stephanie Manaker Bell, Christopher B. Weld.

Before Moore, Reyna, and Stoll, Circuit Judges.

Reyna, Circuit Judge.

In 2017, the U.S. International Trade Commission issued a final affirmative determination that a U.S. domestic industry was materially injured by virtue of imported steel goods sold at less than fair value. Hitachi appealed to the United States Court of International Trade, challenging the Commission’s "domestic like product" determination. The Court of International Trade affirmed the Commission’s domestic like product determination. Hitachi appeals that judgment. Because we conclude that the Commission’s "domestic like product" determination is supported by substantial evidence and otherwise not contrary to law, we affirm.

BACKGROUND

This case arises from an antidumping duty investigation on imports of carbon and alloy steel cut-to-length plate ("CTL plate").¹ On April 8, 2016, three domestic producers of CTL plate ("petitioners") filed petitions with the U.S. Department of Commerce ("Commerce") and the U.S. International Trade Commission ("Commission"), alleging that imports of CTL plate from twelve countries, including Japan, were sold in the United States at less than fair value, and that an industry in the United States was materially injured as a result. Carbon and Alloy Steel Cut-to-Length Plate , 81 Fed. Reg. 22116 (April 14, 2016) (Institution Decision). Both the Commission and Commerce initiated antidumping duty investigations. Id . Hitachi Metals, Ltd., and Hitachi Metals America, LLC ("Hitachi") joined the Commission investigation, identifying itself as "a Japanese producer ... and U.S. importer of carbon and alloy steel cut-to-length plate." Carbon and Alloy Steel Cut-to-Length Plate , Inv. No. 701-560 USITC Pub. 590311 (Sept. 12, 2016).

I. "Domestic Like Product"

Commerce and the Commission play separate and distinct roles in the administration of antidumping duty investigations. 19 U.S.C. § 1673. Generally, Commerce investigates whether certain imported articles are sold in the United States at less than fair value, i.e., "dumped." Cleo Inc. v. United States , 501 F.3d 1291, 1294 (Fed. Cir. 2007). The Commission investigates whether a U.S. "domestic industry" is materially injured or threatened with material injury by reason of those imports. Id. at 1295.

Central to antidumping duty investigations, and central to this appeal, are Commerce’s and the Commission’s separate determinations as to the products relevant to their respective inquiries. Commerce identifies the scope of imported articles subject to the investigation, referred to as the "subject merchandise." Pesquera Mares Australes Ltda. v. United States , 266 F.3d 1372, 1374–75, 1375 n.2 (Fed. Cir. 2001) ; see 19 U.S.C. § 1677(25). The Commission, on the other hand, determines the "domestic like product." The "domestic like product" is a U.S. product "which is like, or ... most similar in characteristics and uses" to the subject merchandise. Cleo Inc. , 501 F.3d at 1295 (quoting 19 U.S.C. § 1677(10) ). The Commission’s definition of which domestic goods constitute "like products" determines the relevant domestic industry and, in turn, the scope of the Commission’s injury analysis. Id.

By statute, the Commission’s "domestic like product" analysis begins with a review of the "articles subject to investigation," i.e., the subject merchandise as determined by Commerce. 19 U.S.C. § 1677(10) (defining "domestic like product" as a "product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation " (emphasis added)). The Commission then conducts a six-factor inquiry that evaluates whether the subject merchandise corresponds with a single domestic like product or multiple domestic like products. Cleo , 501 F.3d at 1295. Specifically, the Commission compares the imported articles and domestic products by considering: (1) physical characteristics and uses; (2) channels of distribution; (3) interchangeability; (4) customer and producer perceptions; (5) common manufacturing facilities, production processes, and production employees; and where appropriate (6) pricing. Id . ; Timken Co. v. United States , 913 F. Supp. 580, 584 (Ct. Int’l Trade 1996). The Commission may determine that the subject merchandise identified by Commerce encompasses one or more domestic like products. Cleo , 501 F.3d at 1295.

II. The Commission’s Investigation

In May 2016, the Commission published its preliminary determination which included a preliminary like product determination. Carbon and Alloy Steel Cut-to-Length Plate , 81 Fed. Reg. 33705–06 (May 27, 2016) (Preliminary Determination); J.A. 121–136. The Commission reviewed Commerce’s subject merchandise determination and then performed the six-factor analysis based on the evidentiary record existing at that time. J.A. 121–133. The Commission concluded that the U.S. domestic industry consists of "a single domestic like product consisting of all CTL plate coextensive with the scope of these investigations ." J.A. 130 (emphasis added). Specifically, the Commission defined the domestic like product as:

Certain carbon and alloy steel hot-rolled or forged flat plate products not in coils, whether or not painted, varnished, or coated with plastics or other non-metallic substances. Subject merchandise includes plate that is produced by being cut-to-length from coils and plate that is rolled or forged into a discrete length. The products covered include (1) Universal mill plates (i.e., flat-rolled products rolled on four faces or in a closed box pass, of a width exceeding 150 mm but not exceeding 1250 mm, and of a thickness of not less than 4 mm, which are not in coils and without patterns in relief), and (2) hot-rolled or forged flat steel products of a thickness of 4.75 mm or more and of a width which exceeds 150 mm and measures at least twice the thickness, and which are not in coils, whether or not with patterns in relief. The covered products described above may be rectangular, square, circular or other shapes and include products of either rectangular or non-rectangular cross-section where such non-rectangular cross-section is achieved subsequent to the rolling process, i.e., products which have been ‘‘worked after rolling,’’ (e.g. , products which have been beveled or rounded at the edges).

J.A. 122–23. The Commission also incorporated certain limitations adopted in Commerce’s subject merchandise determination, such as limitations related to width and thickness, iron and carbon content, and third country processing. Id . In addition, the Commission incorporated Commerce’s seven express exclusions, which included: "products clad, plated, or coated in metal," "military grade armor plate," "stainless steel plate," and "[a]lloy forged and rolled CTL plate." J.A. 123–127. None of the limitations or exclusions related to tool steel.

After the preliminary determination, the Commission issued questionnaires to relevant parties, including domestic producers, importers, purchasers, and foreign producers in the subject countries. See 19 CFR § 207.20(b). Before issuing the questionnaires, the Commission circulated drafts to the parties for comment. Id. Three importers, including Hitachi, submitted comments, asking the Commission to collect separate data for "tool steel" so that the Commission could consider whether tool steel is a separate domestic like product. The Commission granted the request and issued a supplemental questionnaire seeking tool steel data from domestic producers. Four domestic producers responded with information. The Commission also contacted domestic producers who did not respond to the questionnaire. The Commission also collected additional data via telephone and email from several of those producers.

After receiving additional briefing and conducting the public hearing, the Commission undertook another domestic like product analysis in view of the full record. The Commission "examined closely whether the record support[ed] finding a clear dividing line between tool steel and high speed steel on the one hand, and other CTL plate products on the other." J.A. 2118; see also J.A. 2111–2119. After noting that the evidence was "mixed," the Commission found no clear dividing lines between tool steel and other CTL plate products and concluded that defining tool steel as a separate domestic like product was "not warranted." Id . As a result, the Commission reaffirmed its preliminary determination of a single domestic like product coextensive with Commerce’s subject merchandise determination. Id.

III. Court of International Trade

Hitachi appealed the Commission’s final determination to the Court of International Trade.² Hitachi argued that the Commission’s like product determination was legally erroneous and unsupported by substantial evidence. The Court of International Trade rejected Hitachi’s arguments and affirmed the Commission’s determination.

Hitachi...