Changzhou Trina Solar Energy Co., Ltd. v. United States

• Decision Date: 25 January 2019
• Docket Number: Consol. Court No. 17-00199,Slip Op. 19-12
• Citation: 359 F.Supp.3d 1329
• Parties: CHANGZHOU TRINA SOLAR ENERGY CO., LTD. et al., Plaintiffs and Consolidated Plaintiff, v. UNITED STATES, Defendant, and SolarWorld Americas, Inc. and Changzhou Trina Solar Energy Co., Ltd., Defendant-Intervenors and Consolidated Defendant-Intervenor.
• Court: U.S. Court of International Trade

359 F.Supp.3d 1329

CHANGZHOU TRINA SOLAR ENERGY CO., LTD. et al., Plaintiffs and Consolidated Plaintiff,

v.UNITED STATES, Defendant,andSolarWorld Americas, Inc. and Changzhou Trina Solar Energy Co., Ltd., Defendant-Intervenors and Consolidated Defendant-Intervenor.

Slip Op. 19-12

Consol. Court No. 17-00199

United States Court of International Trade.

Dated: January 25, 2019

Jonathan Michael Freed, Trade Pacific, PLLC, of Washington, DC, argued for plaintiff, defendant-intervenor, and consolidated defendant-intervenor Changzhou Trina Solar Energy Co., Ltd., and plaintiffs Trina Solar (Changzhou) Science & Technology Co., Ltd. and Trina Solar (U.S.) Inc. With him on the brief was Robert George Gosselink.

Timothy C. Brightbill, Wiley Rein, LLP, of Washington, DC, argued for consolidated plaintiff and defendant-intervenor SolarWorld Americas, Inc. With him on the brief were Laura El-Sabaawi and Usha Neelakantan.

Justin Reinhart Miller, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With him on the brief were Reginald T. Blades, Jr., Assistant Director, Jeanne E. Davidson, Director, and Joseph H. Hunt, Assistant Attorney General. Of Counsel on the brief was James Henry Ahrens, II, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

OPINION AND ORDER

Kelly, Judge:

This consolidated action is before the court on motions for judgment on the agency record filed by Changzhou Trina Solar Energy Co., Ltd., Trina Solar (Changzhou) Science and Technology Co., Ltd., and Trina Solar (U.S.) Inc. (collectively "Trina") and SolarWorld Americas, Inc. ("SolarWorld").¹ See [Trina] Pls.' Rule 56.2 Mot. J. Agency R., Feb. 2, 2018, ECF No. 29; SolarWorld's Mot. J. Agency R., Feb. 2, 2018, ECF No. 30. Trina and SolarWorld challenge various aspects of the U.S. Department of Commerce's ("Department" or "Commerce") final determination in the administrative review of the antidumping duty ("ADD") order covering certain crystalline silicon photovoltaic products from the People's Republic of China ("PRC").² See Mem. Supp. Mot. [Trina] J. Agency R. at 4–14, Feb. 2, 2018, ECF No. 29-3 ("Trina Pls.' Br."); Pl. [SolarWorld's] Mem. Supp. Rule 56.2 Mot. J. Agency R. at 10–27, Feb. 5, 2018, ECF No. 33 ("Pl. SolarWorld's Br."); see also Certain Crystalline Silicon Photovoltaic Prods. from the [PRC], 82 Fed. Reg. 32,170 (Dep't Commerce July 12, 2017) (final results of [ADD] administrative review and final determination of no shipments; 2014–2016) ("Final Results") and accompanying Issues & Decision Mem. for the Final Results of [ADD] Admin. [Review]: Certain Crystalline Silicon Photovoltaic Prods. from the [PRC]; 2014–2016 at 9–10, A-570-010, (July 5, 2017), ECF No. 19-3 ("Final Decision Memo"); Certain Crystalline Silicon Photovoltaic Prods. from the [PRC], 80 Fed. Reg. 8,592, 8,593 –95 (Dep't Commerce Feb. 18, 2015) ( [ADD] order).

For the reasons that follow, the court sustains Commerce's selection of surrogate values for aluminum frames, module glass,³ and financial ratios. The court also sustains Commerce's decisions to include import data with reported quantities of zero in the surrogate value calculations and to deny offsetting respondent's U.S. indirect selling expenses by the debt restructuring income reported by its U.S. sales affiliate. However, the court finds that Commerce's decision not to offset the Ex-Im Bank Export Buyer's Credit Program is contrary to law and Commerce is directed to recalculate Trina's U.S. selling prices to account for the offset on remand.

BACKGROUND

This administrative review covers subject imports entered during the period of July 31, 2014, through January 31, 2016. See Initiation of Antidumping and Countervailing Duty Admin. Reviews, 81 Fed. Reg. 20,324, 20,335 (Dep't Commerce Apr. 7, 2016). Commerce selected Changzhou Trina Solar Energy Co., Ltd./Trina Solar (Changzhou) Science & Technology Co., Ltd. as the sole mandatory respondent for individual review. See Resp't Selection Mem. [for 2014–2016 ADD Admin. Review] at 5, PD 94, bar code 3472551-01 (May 24, 2016).⁴ Aside from Commerce's decisions to exclude Trina Solar (U.S.) Inc.'s ("TUS") debt restructuring income from its calculation of respondent's indirect selling expenses and to use a simple average to calculate the financial ratios, Commerce's conclusions regarding the other issues challenged before this Court did not change from the preliminary to the final determination. For the final results, Commerce calculated a weighted-average dumping margin of 9.61% for the sole mandatory respondent. Final Results, 82 Fed. Reg. at 32,171.

SolarWorld challenges as not in accordance with law and unsupported by substantial evidence three aspects of Commerce's final determination. See Pl. SolarWorld's Br. at 10–27. Specifically, SolarWorld challenges Commerce's selection of surrogate value data sources to value respondent's aluminum frames, see id. at 10–18, and module glass, see id. at 18–19, and Commerce's selection of Styromatic (Thailand) Co., Ltd.'s ("Styromatic") 2015 financial statements to value respondent's selling, general, and administrative expenses. See id. at 20–27.

Trina challenges three other aspects of Commerce's final determination. See Trina Pls.' Br. at 4–14. Specifically, Trina challenges as not in accordance with law and unsupported by substantial evidence Commerce's decision not to adjust respondent's net U.S. selling prices by the amount countervailed in a parallel countervailing duty ("CVD") investigation. See id. at 4–9. Trina also challenges as unsupported by substantial evidence Commerce's decision to use zero import quantities to calculate surrogate values. See id. at 9–11. Finally, Trina challenges as not in accordance with law, unsupported by substantial evidence, and arbitrary Commerce's decision to exclude, as an offset, the debt restructuring income reported by TUS. See id. at 11–14. On October 16, 2018, the court held oral argument. Oral Ar., Oct. 16, 2018, ECF No. 56.

JURISDICTION AND STANDARD OF REVIEW

The Court has jurisdiction pursuant to 19 U.S.C. § 1516a(a)(2)(B)(iii) (2012)⁵ and 28 U.S.C. § 1581(c) (2012), which grant the Court authority to review actions contesting the final determination in an administrative review of an ADD order. The court will uphold Commerce's determination unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law[.]" 19 U.S.C. § 1516a(b)(1)(B)(i).

DISCUSSION

I. Surrogate Values

SolarWorld challenges Commerce's surrogate value data selections for aluminum frames, module glass, and financial statements to calculate surrogate financial ratios. See Pl. SolarWorld's Br. at 10–27. Defendant refutes all these challenges and argues that Commerce's final determination should be sustained in all respects. See Def.'s Resp. Br. Opp'n [Trina's & SolarWorld's] Rule 56.2 Mots. J. Agency R. at 12–23, June 7, 2018, ECF No. 38 ("Def.'s Resp. Br."). For the reasons that follow, the court sustains Commerce's surrogate value selections for aluminum frames, module glass, and financial ratios.

A. Legal Framework

In antidumping proceedings involving non-market economies, Commerce generally calculates normal value using the factors of production used to produce the subject merchandise and other costs and expenses. 19 U.S.C. § 1677b(c)(1). Commerce will value respondents' factors of production using the "best available information regarding the values of such factors in a market economy country or countries considered to be appropriate by [Commerce]." 19 U.S.C. § 1677b(c)(1)(B). As the term "best available information" is not statutorily defined, Commerce has broad discretion in deciding what constitutes the best available information. See QVD Food Co. v. United States, 658 F.3d 1318, 1323 (Fed. Cir. 2011). However, the agency must ground its selection in the overall purpose of the statute, which is to calculate accurate dumping margins. See Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed. Cir. 1990) ; see also Parkdale Int'l. v. United States, 475 F.3d 1375, 1380 (Fed. Cir. 2007). To the extent possible, Commerce uses factors of production from market economy countries that are: "(A) at a level of economic development comparable to that of the nonmarket economy country, and (B) significant producers of comparable merchandise." 19 U.S.C. § 1677b(c)(4). Commerce's regulatory preference is to "value all factors in a single surrogate country." 19 C.F.R. § 351.408(c)(2) (2016).⁶

Commerce's methodology for selecting the best available information evaluates data sources based upon their: (1) specificity to the input; (2) tax and import duty exclusivity; (3) contemporaneity with the period of review; (4) representativeness of a broad market average; and (5) public availability. See Import Admin., U.S. Dep't Commerce, Non-Market Econ. Surrogate Country Selection Process, Policy Bulletin 04.1 (Mar. 1, 2004), available at http://ia.ita.doc.gov/policy/bull04-1.html (last visited Jan. 18, 2019); Decision Mem. for Prelim. Results of [ADD] Admin. Review: Certain Crystalline Silicon Photovoltaic Prods. from the [PRC]; 2014–2016 at 15, PD 223, bar code 3547659-01 (Feb. 28, 2017) ("Prelim. Decision Memo").

B. Aluminum Frames

SolarWorld challenges Commerce's valuation of respondent's aluminum frames using Thai Harmonized Tariff Schedule ("HTS") subheading 7604.29.90001, covering "Aluminum bars, rods and profiles: Of aluminum alloys: Other," as not in accordance with law and unsupported by substantial evidence. See Pl. SolarWorld's Br. at 10–18. Specifically, SolarWorld argues that evidence on this record demonstrates that respondent's frames were processed into a form beyond the simple aluminum extrusions covered by HTS subheading 7604.29.90001. Id. at 12–14. Defendant responds that Commerce reasonably concluded that import data under HTS...