Writing Instrument Mfrs. v. U.S. Dept. of Commerce
| Citation | 984 F.Supp. 629 |
| Decision Date | 13 November 1997 |
| Docket Number | Slip Op. 97-151.,Court No. 95-01-00081. |
| Parties | WRITING INSTRUMENT MANUFACTURERS ASSOCIATION, PENCIL SECTION, et al., Plaintiffs, v. The UNITED STATES DEPARTMENT OF COMMERCE, Defendant, and China First Pencil Company, Inc., et al., Defendant-Intervenors. |
| Court | U.S. Court of International Trade |
Neville, Peterson & Williams (John M. Peterson, George W. Thompson and Peter J. Allen), Washington, DC, for Plaintiffs.
Frank W. Hunger, Assistant Attorney General, David M. Cohen, Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Velta A. Melnbrencis, of counsel), Barbara Campbell-Potter, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, Washington, DC, for Defendant.
Dickstein, Shapiro & Morin, L.L.P. (Francis J. Sailer and Sarah M. Efthymiou), Washington, DC, for Defendant-Intervenors.
Plaintiffs brought this action to contest the Remand Determination of the Notice of Final Determination of Sales at Less Than Fair Value: Certain Cased Pencils From the People's Republic of China, 59 Fed.Reg. 55,625 (1994) ("Final Determination"). Plaintiffs contest the Remand Determination with respect to eight issues: (1) Commerce's use of U.S. basswood prices as a surrogate; (2) Commerce's use of Pakistani surrogate values for lacquer, ferrules and erasers; (3) Commerce's failure to use import tariffs in its calculation of foreign market value; (4) Commerce's failure to use actual transportation and general, selling and administrative costs; (5) Commerce's granting separate rates to the four exporters; (6) Commerce's wood slat surrogate valuation; (7) Commerce's log surrogate valuation; and (8) Commerce's calculation of the "all others" rate. Defendant-intervenors contest the Remand Determination's wood slat surrogate valuation. The Court affirms the Remand Determination in all respects for the reasons that follow.
On November 10, 1993, plaintiffs, the Pencil Section of the Writing Instrument Manufacturers Association ("WIMA") composed of Dixon-Ticonderoga Corp., Empire Berol Corp., Faber-Castell Corp., General Pencil Company, J.R. Moon Pencil Company and Musgrave Pen & Pencil Co., filed an antidumping petition with the United States Department of Commerce ("Commerce") and the United States International Trade Commission ("ITC") alleging that pencils from the People's Republic of China ("PRC") were being sold at prices below fair market value to the detriment of the domestic pencil industry. On December 8, 1993, Commerce initiated an antidumping investigation on cased pencils from the PRC covering the period of investigation ("POI") from June 1, 1993 through November 30, 1993. Initiation of Antidumping Duty Investigations: Certain Cased Pencils From the People's Republic of China and Thailand, 58 Fed.Reg. 64,548 (1993). On December 20, 1993, the ITC determined that there was a reasonable indication that cased pencils from the PRC were causing material injury to the domestic industry. Certain Cased Pencils From the People's Republic of China and Thailand, 59 Fed.Reg. 593 (1994).
Three Chinese pencil manufacturers filed appearances as parties to the Commerce proceeding: China First Pencil Co. ("China First"), Shanghai Three Star Stationery Industry Corporation ("Three Star") and Anhui Stationery Company ("Anhui"). Four Chinese pencil exporters were also parties to the Commerce proceeding: China First, Shanghai Foreign Trade Corporation ("SFTC"), Shanghai Langsheng Corporation ("Langsheng"), and Guangdong Provincial Stationery & Sporting Goods Import & Export Corporation ("Guangdong"). On June 8, 1994, Commerce made a preliminary determination that pencils from the PRC were sold at less than fair value ("LTFV"). Notice of Preliminary Determination of Sales at Less Than Fair Value: Certain Cased Pencils from the People's Republic of China, 59 Fed.Reg. 30,911 (1994). In the preliminary determination, Commerce found the following separate weighted-average dumping margins for pencil exporters from the PRC: Guangdong — 58.34%, SFTC — 100.98%, Langsheng — 100.98% and all others/country-wide — 107.63%. Id.
From July 4 through 15, 1994, Commerce conducted a verification of the responses of the manufacturers and exporters and interested parties were given the opportunity to submit written comments concerning the investigation. A public hearing was held on October 5, 1994. Commerce issued its Final Determination finding the following separate weighted-average dumping margins for the four participating exporters that requested separate rates:
(1) China First, purchases from manufacturer "Company A" — 0%;
(2) China First, purchases from any other manufacturer — 44.66%;
(3) Guangdong, purchases from manufacturer "Company B" — 0%;
(4) Guangdong, purchases from any other manufacturer — 44.66%;
(5) SFTC — 8.31%; and
(6) Lansheng — 17.45%.
Notice of Final Determination of Sales at Less Than Fair Value: Certain Cased Pencils from the People's Republic of China, 59 Fed.Reg. 55,625, 55,631 (1994). Commerce assigned the countrywide/all others rate of 44.66% to non-participating respondents. Id.
On December 15, 1994, the ITC reached a final affirmative determination that cased pencils from the PRC were threatening the domestic industry with material injury. Certain Cased Pencils From the People's Republic of China, 59 Fed.Reg. 65,788 (1994). Commerce subsequently issued an antidumping duty order on cased pencils from the PRC where Company A was identified as China First and Company B was identified as Three Star. Antidumping Duty Order: Certain Cased Pencils From the People's Republic of China, 59 Fed.Reg. 66,909 (1994).
Plaintiffs filed a summons and complaint on January 25, 1995 alleging, inter alia, that Commerce failed to provide the plaintiffs adequate opportunity to supply pricing information on United States basswood, which Commerce adopted as the surrogate wood in valuing the PRC lindenwood used in the actual production of the pencils at issue. Plaintiffs also attacked Commerce's use of the United States as a surrogate market economy. During the investigation, Commerce determined that the PRC was a nonmarket economy ("NME") country and chose India as the preferred surrogate country but also used surrogate data from Pakistan, Indonesia and the United States. Finally, plaintiffs argued that Commerce employed incorrect methodology in valuing basswood slats and logs.
Based on a motion from Commerce, the Court remanded the case in order to (1) reopen the administrative record for submission of publicly available published information ("PAPI") by plaintiffs and any other corroborating information regarding U.S. basswood prices by defendant-intervenors and (2) reopen the administrative record for submission of PAPI and corroborating information regarding the appropriate methodology for valuing basswood slats and logs.
Commerce issued its Remand Determination on March 22, 1996. Commerce decided to rely on PAPI regarding U.S. basswood pricing utilized in the Final Determination rather than the private studies submitted by plaintiffs in an effort to "increase predictability and certainty." Def.'s Br. at 19. Commerce also found that it was appropriate to change the methodology used to value logs and slats which resulted in recalculation of the average-weighted dumping margins. Both the plaintiffs and defendant-intervenors disputed the Remand Determination results and the Court now determines whether the Remand Determination is supported by substantial evidence and in accordance with law.
In reviewing a final antidumping determination, the Court "shall hold unlawful any determination, finding, or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law, ..." 19 U.S.C. § 1516a(b)(1)(B) (1994). Under this standard, the Court first reviews the agency's methodology to ensure that it is a reasonable means of administering the antidumping statute. The Court will "evaluate for reasonableness the way in which Commerce chose to interpret" the statute it is applying. Micron Technology, Inc. v. United States, 117 F.3d 1386, 1396 (1997). Where the statute is clear, the Court "must give effect to the unambiguously expressed intent of Congress." Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843, 104 S.Ct. 2778, 2781, 81 L.Ed.2d 694 (1984). Where the statute is unsettled, the Court reviews "whether the agency's answer is based on a permissible construction of the statute." Id.
The Court then reviews whether the agency's determinations are supported by substantial evidence on the record. "As long as the agency's methodology and procedures are reasonable means of effectuating the statutory purpose, and there is substantial evidence in the record supporting the agency's conclusions, the court will not impose its own views as to the sufficiency of the agency's investigation or question the agency's methodology." Ceramica Regiomontana, S.A. v. United States, 10 CIT 399, 404-5, 636 F.Supp. 961, 966 (1986), aff'd 5 Fed. Cir. (T) 77, 810 F.2d 1137 (1987) (citations omitted). 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, 458, 95 L.Ed. 456 (1951) (citation omitted). "[Substantial evidence] 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, 620, 86 S.Ct. 1018, 1026, 16 L.Ed.2d 131 (1966) (citations omitted).
Commerce is directed to apply the antidumping provisions contained in the statute...
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