Cooper Tire & Rubber Co. v. United States, 032917 USCIT, 15-00251

Docket Nº:15-00251
Opinion Judge:Timothy C. Stanceu Chief Judge.
Party Name:COOPER TIRE & RUBBER COMPANY, COOPER (KUNSHAN) TIRE CO., LTD., AND COOPER CHENGSHAN (SHANDONG) TIRE CO., LTD., Plaintiffs, v. UNITED STATES, Defendant, and THE UNITED STEEL, PAPER AND FORESTRY, RUBBER, MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION, AFL-CIO, CLC, Defendant-Intervenor. Slip Op. 17-32
Attorney:Gregory C. Dorris, Pepper Hamilton LLP, of Washington, D.C., for plaintiffs. John J. Todor, Senior Trial Counsel, Civil Division, U.S. Department of Justice, of Washington, D.C., for defendant. With him on the brief were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Jeanne E. Da...
Judge Panel:Before: Timothy C. Stanceu, Chief Judge.
Case Date:March 29, 2017
Court:Court of International Trade
 
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COOPER TIRE & RUBBER COMPANY, COOPER (KUNSHAN) TIRE CO., LTD., AND COOPER CHENGSHAN (SHANDONG) TIRE CO., LTD., Plaintiffs,

v.

UNITED STATES, Defendant,

and

THE UNITED STEEL, PAPER AND FORESTRY, RUBBER, MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION, AFL-CIO, CLC, Defendant-Intervenor.

No. 15-00251

Slip Op. 17-32

Court of Appeals of International Trade

March 29, 2017

[Remanding for redetermination a cash deposit rate applied to secure estimated antidumping duties]

Gregory C. Dorris, Pepper Hamilton LLP, of Washington, D.C., for plaintiffs.

John J. Todor, Senior Trial Counsel, Civil Division, U.S. Department of Justice, of Washington, D.C., for defendant. With him on the brief were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, and Franklin E. White, Jr., Assistant Director. Of counsel was Mercedes C. Morno, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce.

Geert De Prest, Stewart and Stewart, of Washington, D.C., for defendant-intervenor. With him on the brief were Terence P. Stewart, Phillip A. Butler, and Nicholas J. Birch.

Before: Timothy C. Stanceu, Chief Judge.

OPINION

Timothy C. Stanceu Chief Judge.

Plaintiffs challenge the antidumping duty cash deposit rate of 11.12% ad valorem that the International Trade Administration, U.S. Department of Commerce ("Commerce" or the "Department") applied to imports of passenger car and light truck tires that they produced and exported from the People's Republic of China. For the reasons discussed below, the court sets the cash deposit rate aside as contrary to law.

I. Background

A. The Parties in this Litigation

Plaintiffs Cooper (Kunshan) Tire Co., Ltd. and Cooper Chengshan (Shandong) Tire Co., Ltd. are affiliated Chinese producers and exporters of tires for passenger cars and light trucks. Plaintiff Cooper Tire & Rubber Company is an affiliated exporter of the subject merchandise of these producers. In this Opinion, the court refers to plaintiffs collectively as "Cooper."

Cooper was a respondent in parallel antidumping duty ("AD") and countervailing duty ("CVD") investigations conducted by Commerce. The petitioner in the investigations was the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union (the "USW"), which is the defendant-intervenor in this litigation.

B. The Contested Determination and the Contested Cash Deposit Rate

In June 2015, Commerce issued a decision published as Antidumping Duty Investigation of Certain Passenger Vehicle and Light Truck Tires From the People's Republic of China: Final Determination of Sales at Less Than Fair Value and Final Affirmative Determination of Critical Circumstances, In Part, 80 Fed. Reg. 34, 893 (Int'l Trade Admin. June 18, 2015) ("Final AD Determination"). Commerce subsequently issued an "Amended Final Determination" accompanied by antidumping duty and countervailing duty orders, published as Certain Passenger Vehicle and Light Truck Tires From the People's Republic of China: Amended Final Affirmative Antidumping Duty Determination and Antidumping Duty Order; and Amended Final Affirmative Countervailing Duty Determination and Countervailing Duty Order, 80 Fed. Reg. 47, 902 (Int'l Trade Admin. Aug. 10, 2015) ("Amended Final Determination"). In the Amended Final Determination, Commerce assigned Cooper an estimated dumping margin of 25.84%. Id. at 47, 905. Commerce nominally set the cash deposit rate at the same rate as the margin but made a downward adjustment resulting in an applied cash deposit rate of 11.12% for the merchandise Cooper exported to the United States. Amended Final Determination, 80 Fed. Reg. at 47, 904 n.19; see also Final AD Determination, 80 Fed. Reg. at 34, 897. Cooper claims that the downward adjustment was improperly calculated and is therefore insufficient. Commerce determined a CVD cash deposit rate of 20.73% for Cooper, Amended Final Determination, 80 Fed. Reg. at 47, 907, which Cooper does not contest in this litigation.

C. The Parallel AD and CVD Investigations

On July 21, 2014, Commerce initiated the parallel AD and CVD investigations. Certain Passenger Vehicle and Light Truck Tires From the People's Republic of China: Initiation of Antidumping Duty Investigation, 79 Fed. Reg. 42, 292 (Int'l Trade Admin. July 21, 2014); Certain Passenger Vehicle and Light Truck Tires From the People's Republic of China: Initiation of Countervailing Duty Investigation, 79 Fed. Reg. 42, 285 (Int'l Trade Admin. July 21, 2014). On January 27, 2015, Commerce published its preliminary less-than-fair value determination in the AD investigation ("Preliminary AD Determination"). Certain Passenger Vehicle and Light Truck Tires From the People's Republic of China: Preliminary Determination of Sales at Less Than Fair Value; Preliminary Affirmative Determination of Critical Circumstances; In Part and Postponement of Final Determination, 80 Fed. Reg. 4, 250 (Int'l Trade Admin. Jan. 27, 2015) ("Preliminary AD Determination").

Commerce initially selected Shandong Yongsheng Rubber Group Co., Ltd. ("Yongsheng") and GITI Tire Global Trading Pte. Ltd. and its affiliates ("GITI") as the only two mandatory respondents in the AD investigation. Antidumping Duty Investigation of Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China: Respondent Selection 4-5 (Int'l Trade Admin. Aug. 27, 2014), ECF No. 33 (Admin.R.Doc. No. 304). Commerce initially chose the same two companies as the mandatory respondents in the parallel CVD investigation. See Def.-Int. the USW's Opp'n to Pls.' Mot. for J. on the Agency R., Ex. 1 at 4-5 (Apr. 14, 2016), ECF No. 30 ("USW's Br."). In the Preliminary AD Determination, Commerce stated that Yongsheng "did not demonstrate that it is entitled to a separate rate" and that "[a]ccordingly, we consider Yongsheng to be part of the PRC-Wide Entity." Preliminary AD Determination, 80 Fed. Reg. at 4, 252. The "PRC-Wide Entity" includes the Chinese exporters and producers Commerce determines not to have demonstrated independence from the government of the PRC.

Prior to publication of the Preliminary AD Determination, Commerce selected Sailun Group Co., Ltd. ("Sailun") to replace Yongsheng as the second mandatory respondent in the AD investigation. See Antidumping Duty Investigation of Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China: Selection of Additional Mandatory Respondent (Int'l Trade Admin. Oct. 7, 2014), ECF. No. 33 (Admin.R.Doc. No. 617). Because Commerce decided not to select Cooper as a mandatory respondent, and because it rejected Cooper's request to be named a voluntary respondent, in the AD investigation (decisions Cooper does not challenge in this litigation), Cooper did not receive an individual weighted average margin in the AD investigation. Instead, Cooper was assigned the rate assigned to all "separate rate" respondents in that investigation, i.e., respondents that qualified for a rate separate from the rate Commerce applied to the PRC-Wide Entity. Commerce, however, chose Cooper as the second mandatory respondent in the CVD investigation. USW's Br., Ex. 2 at 2. GITI remained as a mandatory respondent in both investigations.

On June 18, 2015, Commerce published the final determination in the antidumping duty investigation, Final AD Determination, 80 Fed. Reg. at 34, 893, which Commerce amended on August 10, 2015 for correction of ministerial errors, Amended Final Determination, 80 Fed. Reg. at 47, 902. The final individual weighted average dumping margins in the Amended Final Determination were 30.74% for GITI and 14.35% for Sailun; Commerce assigned a rate of 25.84% to the separate rate respondents in the antidumping duty investigation, including Cooper, calculated as the weighted average of the two individual margins. Amended Final Determination, 80 Fed. Reg. at 47, 905.

In the Final AD Determination, Commerce announced that the cash deposit rate for merchandise produced or exported by Cooper would be calculated by making two downward adjustments to Cooper's nominal cash deposit rate, which was the same as the final dumping margin (determined at that time as 25.30%, which Commerce applied to Cooper and all other separate rate respondents). Final AD Determination, 80 Fed. Reg. at 34, 897. For the first adjustment to the cash deposit rate, Commerce stated that it would subtract from the percentage the "export subsidy rate" of 11.13%, which Commerce determined individually for Cooper in the course of the companion countervailing duty investigation. Id. The other separate rate respondents in the AD investigation received an "all-others" export subsidy...

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