Borusan Mannesmann Boru Sanayi ve Ticaret A.S. v. United States
| Decision Date | 22 May 2020 |
| Docket Number | Consol. Court No. 19-00056,Slip Op. 20-71 |
| Parties | BORUSAN MANNESMANN BORU SANAYI VE TICARET A.Ş., Plaintiff, AMERICAN CAST IRON PIPE COMPANY, et al., Consolidated Plaintiffs, v. UNITED STATES, Defendant, AMERICAN CAST IRON PIPE COMPANY, et al., Defendant-Intervenors, and BORUSAN MANNESMANN BORU SANAYI VE TICARET A.Ş, Consolidated Defendant-Intervenor. |
| Court | U.S. Court of International Trade |
Before: Jane A. Restani, Judge
PUBLIC VERSION
OPINION AND ORDER[Commerce's Final Results of Redetermination Pursuant to Court Remand are sustained]
Julie C. Mendoza, Donald B. Cameron, R. Will Planert, Brady W. Mills, Mary S. Hodgins, Edward J. Thomas, III, Eugene Degnan, Jordan L. Fleischer, Sabahat Chaudhary, and Rudi W. Planert, Morris, Manning & Martin L.L.P., of Washington, D.C., for Plaintiff and Consolidated Defendant-Intervenor Borusan Mannesmann Boru Sanayi ve Ticaret A.Ş.
Timothy C. Brightbill, Maureen E. Thorson, Laura El-Sabaawi, Adam M. Teslik, Elizabeth S. Lee, Enbar Toledano, and Tessa V. Capeloto, Wiley Rein L.L.P., of Washington, D.C., for
Consolidated Plaintiffs and Defendant-Intervenors American Cast Iron Pipe Company, Berg Steel Pipe Corporation, Berg Spiral Pipe Corporation, Dura-Bond Industries, Strupp Corporation, Greens Bayou Pipe Mill LP, JSW Steel (USA) Inc., Skyline Steel, Trinity Products LLC, and Welspun Tubular LLC.
Robert R. Kiepura, Trial Attorney, and L. Misha Preheim, Assistant Director, Civil Division, Commercial Litigation Branch, U.S. Department of Justice, of Washington, D.C., for Defendant United States of America. With them on the brief were Joseph H. Hunt, Assistant Attorney General, and Jeanne E. Davidson, Director, Civil Division, Commercial Litigation Branch, U.S. Department of Justice, of Washington, D.C. Of counsel on the brief was Reza Karamloo, Senior Attorney, Office of the Chief Counsel, Commercial Litigation Branch for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, D.C.
Restani, Judge: This matter is before the court following a remand to the Department of Commerce ("Commerce") in Borusan Mannesmann Boru Sanayi ve Ticaret A.Ş. v. United States, 426 F. Supp. 3d 1395 (CIT 2020) ("Borusan"), in which Plaintiff, Borusan Mannesmann Boru Sanayi ve Ticaret A.Ş. ("BMB"), challenges a final determination and resulting antidumping duty order as to certain Large Diameter Welded Pipe ("LDWP") from the Republic of Turkey. See Large Diameter Welded Pipe from the Republic of Turkey: Final Determination of Sales at Less Than Fair Value, 84 Fed. Reg. 6,362 (Dep't Commerce Feb. 27, 2019) ("Final Determination"); Large Diameter Welded Pipe from the Republic of Turkey: Amended Final Affirmative Antidumping Duty Determination & Antidumping Duty Order, 84 Fed. Reg. 18,799 (Dep't Commerce May 2, 2019).
In Borusan, the court upheld Commerce's determination that BMB was entitled to a post-sale price adjustment and concluded that Commerce's application of its new arm's-length test to BMB's home-market transactions with its affiliate was not contrary to law. Borusan, 426 F. Supp. 3d at 1406-10, 1413-14. The court remanded to Commerce to reconsider (1) the amount of BMB's downward post-sale price adjustment on its home market sales and (2) the date of BMB's U.S. sales, and ordered Commerce to eliminate any adjustment to BMB's sales below the costs of production based on a finding that a particular market situation ("PMS") exists in the exporting country. See id. at 1415.
Following remand, Commerce concluded it did not have additional evidence showing an improper allocation of the post-sale price adjustment to BMB. Final Results of Redetermination Pursuant to Court Remand, ECF No. 86 at 1, 4 (Mar. 9, 2020) ("Remand Results"). Thus, Commerce, under protest, granted BMB "the full amount of the post-sale price adjustment," which resulted in a de minimis estimated weighted-average dumping margin. Id. at 1, 4. Accordingly, Commerce did not address BMB's U.S. date of sale or sales-below-cost because doing so would be an exercise in futility. Id. at 4. The Remand Results adequately address the court's concerns in Borusan and they are supported by substantial evidence. Accordingly, the Remand Results are sustained.
While the court presumes familiarity with the record in Borusan, the court briefly summarizes the relevant record evidence for ease of reference. The period of investigation covers January 1 through December 31, 2017. See Final Determination, 84 Fed. Reg. at 6,362. In Autumn 2013, BMB and two other Turkish LDWP producers (the "Consortium Members") formed a general partnership (the "Consortium"). See BMB's Resp. to Commerce's Suppl. Sections A-C Questionnaire, C.R. 200-225, P R. 173-174 (June 15, 2018), ECF No. 100 at 38-45 (May 5, 2020). (the "2013 Joint Venture Agreement"). The 2013 Joint Venture Agreement recognizes joint and several liability among the Consortium Members as to the Consortium's liabilities to third-parties, and goes on to create an irrevocable guaranty arrangement between the Consortium and the Consortium Members.1
In Spring 2014, in advance of submitting their bid for a domestic pipeline project, the Consortium Members concluded a second written agreement in which they re-affirmed their individual obligations to the Consortium in view of the specific project's requirements. See BMB's Resp. to Commerce's Suppl. Sections A-C Questionnaire, C.R. 200-225, P R. 173-174 (June 15, 2018), ECF No. 100 at 47-48 (May 5, 2020) ("2014 Consortium Agreement"). Specifically, the 2014 Consortium Agreement reiterates the Consortium Members' joint and several liability as to the Client and provides that should any Consortium Member fail to fulfill its obligations to the Client, the other two Members would indemnify those obligations. Id. at ¶ 2. The Consortium won the bid and, in Autumn 2014, agreed to sell certain quantities of LDWP to the Client. See BMB's Suppl. Resp. to Commerce's Second Suppl. Questionnaire, CR. 280-288, P.R. 180, Ex. B-32 (July 6, 2018), ECF No. 100 at 60-199 (May 5, 2020) (the "Sales Contract"). As a condition precedent to the Client's performance, the Consortium was required to provide the Client a written guaranty agreement demonstrating that each Consortium Member indemnifies the others' obligations as to the Client. See id. at 99, ¶ 6.4.2
In June 2018, pursuant to the 2014 Consortium Agreement, BMB negotiated a settlement with the Client on behalf of the Consortium for [[ ]], the whole of which was invoiced to BMB, as leader of the Consortium, "on behalf of" the Consortium for the contractual late delivery penalties incurred in 2017. See BMB's Resp. to Commerce's Suppl. Questionnaire, C.R. 200-225, P.R. 173-174, Ex. B-28 (June 15, 2018), ECF No. 65-1 at 144 (Oct. 30, 2019). The Consortium Members agreed, pursuant to the 2014 Consortium Agreement, that BMB's liability as to the other Consortium Members was [[ ]], the same amount for which it seeks a post-sale price adjustment. See BMB's Resp. to Commerce's Suppl. Questionnaire, C.R. 200-225, P.R. 173-174, Ex. B-28 (June 15, 2018), ECF No. 65-1 at 147-153 (Oct. 30, 2019) ("2018 Consortium Protocol"). Nevertheless, in the Final Determination, Commerce allocated the penalty equally among the Consortium Members, and BMB sought review here. See Borusan, 426 F. Supp. 3d at 1404-05.
Accordingly, the court sustained Commerce's determination that BMB is entitled to a downward post-sale price adjustment for the foregoing home-market sales expenses, in view of 19 C.F.R. §§ 351.102(b)(38) and 351.401(c) (2018).3 See id. at 1406-10, 1406 n.11. Nevertheless, the court remanded to Commerce to reconsider whether the foregoing documents or any other "evidence not previously cited" establishes that BMB "was liable for and actually paid or was credited" a sum less than the full amount that BMB seeks in its adjustment. See id. at 1410.
The court's jurisdiction continues pursuant to 19 U.S.C. § 1516a(a)(2)(B)(i) and 28 U.S.C. § 1581(c) (2018).4 The court sustains Commerce's final redetermination results unless they are "unsupported by substantial evidence on the record, or otherwise not in accordance with law[.]" 19 U.S.C. § 1516a(b)(1)(B)(i). "The results of a redetermination pursuant to court remand are also reviewed for compliance with the court's remand order." U.S. Steel Corp. v. United States, 219 F. Supp. 3d 1300, 1307 (CIT 2017) (internal quotations and citations omitted).
In Borusan, notwithstanding the statutory definition of "normal value," the court deferred to Commerce's interpretation of its regulations, concluding that Commerce may disregard certain home market sales adjustments "'on a case-by-case basis and in the light of the evidence and arguments on each record'" when determining whether, and to what extent, a respondent is entitled to a post-sale price adjustment to normal value. Borusan 426 F. Supp. 3d at 1406 (quoting Modification of Regulations Regarding Price Adjustments in Antidumping Duty Proceedings, 81 Fed. Reg. 15,641, 15,645 (Dep't Commerce Mar. 24, 2016) ("Final Modification")). In view of Commerce's decision to grant BMB a partial post-sale price adjustment,5 the court reasoned that BMB had established its entitlement to an adjustment to Commerce's satisfaction. See id. at 1407-09. The problem seen by the court was that there was no substantial evidence to support equal allocation of the adjustment among the Consortium Members. See id. 1409. Accordingly, the court remanded to Commerce "to review the penalty documents" or "evidence not previouslycited" to determine whether BMB met its burden as to its claimed adjustment. Id. at 1410. The court did not "specifically reject[]" any methodologies, although Commerce was not incorrect that without more evidence or a new explanation, the court would reject equal allocation. See Remand Results at 7.
Having found no new...
To continue reading
Request your trial