Andaman Seafood Co., Ltd v. U.S., Slip Op. 10-12.

• Decision Date: 02 February 2010
• Docket Number: Slip Op. 10-12.,Court No. 09-00091.
• Citation: 675 F.Supp.2d 1363
• Parties: ANDAMAN SEAFOOD CO., LTD., et al., Plaintiffs, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

675 F.Supp.2d 1363

ANDAMAN SEAFOOD CO., LTD., et al., Plaintiffs, v. UNITED STATES, Defendant.

Slip Op. 10-12.

Court No. 09-00091.

United States Court of International Trade.

February 2, 2010.

White & Case LLP, Washington, DC (Walter J. Spak, Frank H. Morgan and Jay C. Campbell) for the Plaintiffs.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director; Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (L. Misha Preheim), and, of counsel, Jonathan Zielinski, Office of Chief Counsel for Import Administration, United States Department of Commerce, for Defendant.

OPINION

POGUE, Judge.

This action raises the question of whether the government may choose to give only prospective effect to its decision to bring its administration of domestic antidumping law into compliance with international commitments.

Plaintiffs are producers/exporters of frozen warmwater shrimp from Thailand. Plaintiffs seek review of the Department of Commerce's ("Commerce" or "the Department") response to the findings of a World Trade Organization ("WTO") panel regarding the antidumping duty investigation of certain frozen warmwater shrimp from Thailand.¹ Specifically, Plaintiffs challenge Commerce's partial, rather than total, revocation of the antidumping order at issue, and the Department's decision to apply only prospectively the revised antidumping margin contained in the Final § 129 Determination, i.e., the decision to apply the recalculation of the Department's determinations of sales at less than fair value ("LTFV"), the revised antidumping margin, solely to subject merchandise entered, or withdrawn from warehouse, for consumption on or after the effective date of that Final § 129 Determination. Plaintiffs contend that in declining to apply the revocation of the antidumping order to unliquidated entries predating the effective date of implementation of the Final § 129 Determination, the Department acted contrary to law. (Compl.¶ 16.)²

The court has jurisdiction over this case pursuant to 28 U.S.C. § 1581(c).³ Because domestic law permits the agency's determination, the court concludes that the Department did not act contrary to law.

BACKGROUND

This action stems from Commerce's 2005 antidumping duty order covering certain frozen warmwater shrimp from Thailand that were entered or withdrawn from warehouse for consumption on or after August 4, 2004 (the "subject merchandise"). See Certain Frozen Warmwater Shrimp from Thailand, 70 Fed.Reg. 5,145 (Dep't Commerce Feb. 1, 2005) (notice of amended final determination of sales at less than fair value and antidumping duty order) ("Final Determination & Order"); see also Sections 731-36 of the Tariff Act of 1930, as amended, 19 U.S.C. §§ 1673-73e(a) (2006).⁴ The subject merchandise included goods that Plaintiffs produced or exported.

In its Final Determination & Order, Commerce calculated Plaintiffs' dumping margins by using a "zeroing" methodology.⁵ The Department's use of this methodology was challenged at the WTO, and, in response to this challenge, a WTO dispute settlement panel concluded that the United States—by employing zeroing to calculate dumping margins in the Final Determination & Order—acted inconsistently with Article 2.4.2 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 ("WTO Antidumping Agreement"). The WTO panel recommended that the United States bring its dumping determination into conformity with its obligations under the relevant WTO agreements. Panel Report, United States—Measures Relating to Shrimp from Thailand, ¶¶ 2.2, 8.2, 8.6, WT/DS343/R (Feb. 29, 2008) ("U.S.—Shrimp (Thailand) Panel Report"). (See also Compl. ¶ 7.)

The United States did not appeal the panel's conclusion in this respect,⁶ and the panel's report was adopted by the WTO Dispute Settlement Body ("DSB") on August 1, 2008. Action by Dispute Settlement Body, United States—Measures Relating to Shrimp from Thailand, WT/DS343/14 (Aug. 7, 2008). (See also Compl. ¶ 7.)⁷

Following the DSB decision, the government entered into the statutory process to determine whether and how to respond. See 19 U.S.C. § 3538. Specifically, on November 14, 2008, Commerce "advised interested parties that it was initiating a proceeding under section 129 of the URAA . . . that would implement the findings of the WTO dispute settlement panel in [U.S.—Shrimp (Thailand) Panel Report]." Final § 129 Determination, 74 Fed.Reg. at 5,638. See also 19 U.S.C. § 3538(b).⁸ The Department then issued its preliminary results, on November 21, 2008, and, after receiving comments and rebuttal comments from the interested parties, the Department issued its final results on January 12, 2009. In its final results, the Department recalculated the weighted-average dumping margins from the antidumping investigation without zeroing, i.e., by applying the calculation methodology described in Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an Antidumping Investigation, 71 Fed.Reg. 77,722 (Dep't Commerce Dec. 27, 2006) (final modification). Final § 129 Determination, 74 Fed.Reg. at 5,638-39.

Continuing the statutory process, "the [United States Trade Representative (`USTR')] held consultations with the Department and the appropriate congressional committees with respect to this determination [as required by section 129(b)(3) of the URAA]," id. at 5,638, and, on January 16, 2009, "in accordance with sections 129(b)(4) and 129(c)(1)(B) of the URAA, the USTR directed the Department to implement in whole this determination." Id. See also 19 U.S.C. § 3538(b)(4).

Accordingly, on January 30, 2009, Commerce issued notice of its determination under Section 129, stating that the Department will apply the recalculated weighted-average dumping margins from the antidumping investigation of frozen warmwater shrimp from Thailand to subject merchandise entered or withdrawn from warehouse for consumption on or after January 16, 2009, the effective date of the determination. Final § 129 Determination at 5,639; see 19 U.S.C. § 3538(c)(1)(B) (determination under Section 129 shall apply to entries made on or after "the date on which the Trade Representative directs [Commerce] to implement that determination").

The re-calculated margins for Plaintiffs were de minimis, Final § 129 Determination, 74 Fed.Reg. at 5,639; see 19 U.S.C. § 1673b(b)(3) (defining de minimis as less than two percent). Based on this finding, the Department partially revoked the antidumping order with respect to Plaintiffs, effective for all entries of the subject merchandise entered on or after January 16, 2009, the effective date of the recalculation. Final § 129 Determination, 74 Fed. Reg. at 5,639; Partial Revocation of Antidumping Duty Order on Certain Frozen Warmwater Shrimp from Thailand Produced and Exported by the Rubicon Group Co's, A-549-822 (CBP Feb. 23, 2009), Admin. R. Pub. Doc. 44; see also 19 U.S.C. 1673d(a)(4) (Commerce shall disregard de minimis dumping margins).

Plaintiffs now challenge the Final § 129 Determination, arguing that, first, the United States retains no legal authority to assess antidumping duties on Plaintiffs' prior unliquidated entries (i.e., unliquidated entries made prior to January 16, 2009—the effective date of the Section 129 recalculation and partial revocation of the dumping order) because "the effect of the Section 129 Determination was to invalidate the original LTFV determination with respect to the [Plaintiffs]" (Mem. of P. & A. in Supp. of Pls.' USCIT R. 56.2 Mot. for J. on Agency R. ("Pls.' Mem.") 8), and "[t]he U.S. antidumping law mandates that antidumping duties can only be assessed when there is a valid determination of dumping" (id. at 11 (citing 19 U.S.C. § 1673)).

Plaintiffs rely on Laclede Steel Co. v. United States, 20 CIT 712, 928 F.Supp. 1182 (1996); Jilin Henghe Pharm. Co. v. United States, 28 CIT 969, 342 F.Supp.2d 1301 (2004), vacated as moot, 123 Fed. Appx. 402 (Fed.Cir.2005); and Tembec, Inc. v. United States, 30 CIT 1519, 461 F.Supp.2d 1355 (2006), judgment vacated, 31 CIT 241, 475 F.Supp.2d 1393 (2007) (hereinafter collectively referred to as the "LaClede line" of cases), for the proposition that "[o]nce Commerce's final antidumping determination has been invalidated, it cannot serve as a legal basis for the imposition of antidumping duties." (Id. at 12 (quoting Jilin, 28 CIT at 978, 342 F.Supp.2d at 1309-10); see generally id. at 11-14.)

Second, Plaintiffs argue that Commerce's decision not to apply the Section 129 recalculation and partial revocation of the dumping order to those of Plaintiffs' unliquidated entries that were entered prior to the Section 129 determination is not consistent with the United States's international obligations under the WTO agreements, and therefore contrary to law, pursuant to Murray v. Schooner Charming Betsy, 6 U.S. (2 Cranch.) 64, 118, 2 L.Ed. 208 (1804) ("[A]n act of Congress ought never to be construed to violate the law of nations if any other possible construction remains. . . ."). (Compl. ¶ 16.)

Plaintiffs rely on two other WTO Appellate Body Reports, United States—Measures Relating to Zeroing and Sunset Reviews, Recourse to Article 21.5 of the DSU by Japan, WT/DS322/AB/RW (Aug. 18, 2009), and United States—Laws, Regulations and Methodology for Calculating Dumping Margins ("Zeroing"), Recourse to Article 21.5 of the DSU by the European Communities, WT/DS294/AB/RW (May 14, 2009) (Pls.' Mem. 16-18) for the proposition that "the WTO Agreements establish that prospective compliance means applying a measure that is WTO-consistent after the compliance period ends—irrespective of when the entries occurred." (Id. at 17-18.) Invoking Allegheny Ludlum Corp. v. United States, 29 CIT 157, 173, 358 F.Supp.2d 1334, 1348 (2005) ("[Where] Congress has not statutorily created an unavoidable conflict with the WTO, there exists no...