China Steel Corp. v. U.S.

Decision Date14 May 2003
Docket NumberNo. 01-01040.,SLIP OP. 03-52.,01-01040.
Citation264 F.Supp.2d 1339
PartiesCHINA STEEL CORPORATION and Yieh Loong, Plaintiff, v. UNITED STATES, Defendant, and Bethlehem Steel Corporation; National Steel Corporation; United States Steel Corporation; Gallatin Steel Company; IPSCO Steel Inc.; Nucor Corporation; Steel Dynamics, Inc.; and Weirton Steel Corporation, Defendant-Intervenors.
CourtU.S. Court of International Trade

Miller & Chevalier Chartered, Washington, DC (Karl Abendschein, Peter Koenig) for Plaintiff.

Robert D. McCallum, Jr., Assistant Attorney General, David M. Cohen, Director, Lucius B. Lau, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, Augusto Guerra, Attorney, Office of Chief Counsel for Import Administration, U.S. Department of Commerce, for Defendant, of counsel.

Dewey Ballantine LLP, Washington, DC (Bradford Ward, Hui Yu) for Defendant-intervenors Bethlehem Steel Corporation, National Steel Corporation, and United States Steel Corporation.

Schagrin Associates (Roger B. Schagrin) for Defendant-intervenors Gallatin Steel Company, IPSCO Steel Inc., Nucor Corporation, Steel Dynamics, Inc., and Weirton Steel Corporation.

Opinion

POGUE, Judge.

This action is before the Court on the motion of China Steel Corporation ("China Steel") and Yieh Loong (collectively "Plaintiff) for judgment upon the agency record pursuant to USCIT R. 56.2.1 Plaintiff contests the final affirmative determination of sales at less than fair value ("LTFV") rendered by the International Trade Administration of the United States Department of Commerce ("Commerce" or "Department") in the investigation of certain hot-rolled carbon steel ("HRCS") flat products from Taiwan for the period October 1, 1999 through September 30, 2000 ("POI"). Certain Hot-Rolled Carbon Steel Flat Products from Taiwan, 66 Fed.Reg. 49,618, 49,618-19 (Dep't Commerce Sept. 28, 2001) (notice of final determination of sales at LTFV) ("Final Determ."). Specifically, Plaintiff contests four aspects of Commerce's final determination: (1) Commerce's affiliation determination regarding the Yieh Loong affiliates; (2) Commerce's decision to apply facts otherwise available; (3) Commerce's decision to apply adverse facts available; and (4) Commerce's conduct in investigating the antidumping petition. The Court exercises jurisdiction pursuant to 28 U.S.C. § 1581(c) (2000). For the reasons set forth below, the Court sustains in part, and remands in part, the agency's determination.

I. Background

On November 13, 2000, Gallatin Steel Company, IPSCO Steel Inc., Nucor Corporation, Steel Dynamics, Inc., Weirton Steel Corporation, Bethlehem Steel Corporation, U.S. Steel Group (a unit of USX Corporation), National Steel Corporation, United Steelworkers of America, LTV Steel Company, Inc., and Independent Steelworkers Union (collectively "Domestic Producers")2 initiated an antidumping investigation with Commerce. Certain HRCS Flat Products from Argentina, India, Indonesia, Kazakhstan, the Netherlands, the People's Republic of China, Romania, South Africa, Taiwan, Thailand, and Ukraine, 65 Fed.Reg. 77,568, 77,568 (Dep't Commerce Dec. 12, 2000) (notice of initiation of antidumping duty investigations) ("Initiation Notice"). The Domestic Producers alleged that imports of HRCS flat products from Argentina, India, Indonesia, Kazakhstan, the Netherlands, the People's Republic of China, Romania, South Africa, Taiwan, Thailand, and Ukraine were being or likely to be sold at LTFV.3 Id, at 77,569. On December 4, 2000, Commerce initiated an investigation to determine whether certain HRCS flat products were being sold at LTFV in the United States. Prelim. Determ., 66 Fed.Reg. at 22,204. In their petition for unfair trade relief, the Domestic Producers identified China Steel and Yieh Loong as principal Taiwanese producers of the subject merchandise. Initiation Notice, 65 Fed.Reg. at 77,576.

Commerce issued an antidumping duty questionnaire to China Steel and Yieh Loong requesting responses to sections A (General Information), B (Sales in the Home Market or to Third Countries), C (Sales to the United States), and D (Cost of Production) on January 4, 2001. Final Determ., 66 Fed.Reg. at 49,619; Letter from Robert James, Program Manager, Int'l Trade Admin., to Ablondi, Foster, Sobin & Davidow, P.C., P.R. Doc. 28, Pl.'s Ex. 2 at 2 (Jan. 4, 2001) ("Questionnaire I").4 Commerce explicitly informed China Steel and Yieh Loong that "[i]f [either respondent were] unable to respond to this questionnaire within the specified time limits, [the respondent] must formally request an extension of time." Questionnaire I, P.R. Doc. 28, Pl's Ex. 2 at 2. Questionnaire I directed China Steel to provide affiliated parties' resale information if "sales to affiliates constituted more than five percent of total home market sales." Final Determ., 66 Fed.Reg. at 49,621. That questionnaire defined "affiliated persons" according to Section 771(33) of the Tariff Act of 1930, as amended, and §§ 351.102(b) and 351.401(f) of the Department's regulations. Questionnaire I, P.R. Doc. 28 at app. I.

China Steel requested to be excused from reporting home market resales by affiliates on January 19, 2001, as sales to its affiliates, China Steel Global Trading Corporation and China Steel Chemical Corporation, constituted less than five percent of its total home market sales. Final Determ., 66 Fed.Reg. at 49,621. Commerce responded on January 29, 2001, stating that the agency could not make a determination based on the information China Steel provided, and requested China Steel to "document the total quantity of subject merchandise sold to all affiliated parties." Id.

China Steel and Yieh Loong submitted responses to section A of Questionnaire I on February 2, 2001. Id. at 49,619. The following day, China Steel and Yieh Loong requested a three week extension of time to complete sections B, C, and D of Questionnaire I, stating that the information required was extensive and complex, and the employees answering the questions had also been finalizing the respective companies' accounts. Letter from Peter Koenig and Kristen Smith, Ablondi, Foster, Sobin & Davidow, P.C., to U.S. Sec'y of Commerce, P.R. Doc. 38, PL's Ex. 3 at 1 (Feb. 3, 2001). Commerce granted that request in part, extending the deadline to February 22, 2001, and warning the two companies that the statutory deadlines imposed on the agency were "mandatory, not optional in nature." See Letter from Robert James, Program Manager, Int'l Trade Admin., to China Steel Corporation and Yieh Loong Enterprise, Co., Ltd., c/o Peter Koenig, Ablondi, Foster, Sobin & Davidow, P.C., P.R. Doc. 115, Pl's Ex. 9 at 1-2 (Apr. 25, 2001) ("Denial Letter"). China Steel and Yieh Loong again requested an additional week of time on February 14, 2001 for the same reasons described above to complete sections B and D of Questionnaire I. Letter from Peter Koenig and Kristen Smith, Ablondi, Foster, Sobin & Davidow, P.C., to U.S. Sec'y of Commerce, P.R. Doc. 43, PL's Ex. 4 (Feb. 14, 2001).

On February 26, 2001, China Steel and Yieh Loong filed their responses to sections B, C, and D of Commerce's Questionnaire I. Final Determ., 66 Fed.Reg. at 49,619. The following day, Commerce issued supplemental section A questionnaires to China Steel and Yieh Loong seeking, among other things, clarification of each companies' relationship with other companies. See Letter from Robert James, Program Manager, Int'l Trade Admin., to Yieh Loong Enterprise, Co., Ltd., c/o Peter Koenig, Ablondi, Foster, Sobin & Davidow, P.C., C.R. Doc. 21, Def.'s Conf. Ex. 2 at 1, supp. questionnaire para. 5, 8, 9 (Feb. 27, 2001); Letter from Robert James, Program Manager, Int'l Trade Admin., to China Steel Corporation, c/o Peter Koenig, Ablondi, Foster, Sobin & Davidow, P.C., C.R. Doc. 22, Def.'s Conf. Ex. 3 at 1, supp. questionnaire para. 3-4 (Feb. 27, 2001).

On March 15, 2001, Commerce issued supplemental sections B and C questionnaires to China Steel and Yieh Loong (collectively "Questionnaire II"), seeking missing product characteristics information. Final Determ., 66 Fed.Reg. at 49,620; Letter from Robert James, Program Manager, Int'l Trade Admin., to Yieh Loong Enterprise, Co., Ltd., c/o Peter Koenig, Ablondi, Foster, Sobin & Davidow, P.C., P.R. Doc. 69, Def.'s Ex. 2 (Mar. 15, 2001) (instructing that a "complete" response be provided by March 28, 2001) (emphasis in original) ("YL's Questionnaire II"). Commerce again requested that China Steel provide data containing "all affiliated parties' resale information, [which includes sales by] (Yieh Loong, China Steel Chemical [Corporation], China Steel Global [Trading Corporation], Yieh Phui [Enterprise Co. Ltd.], [and] Yieh Hsing [Enterprise Co. Ltd.]) to the first unaffiliated party." Final Determ., 66 Fed.Reg. at 49,621; see also Letter from Robert James, Program Manager, Int'l Trade Admin., to China Steel Corporation, c/o Peter Koenig, Ablondi, Foster, Sobin & Davidow, P.C., C.R. Doc. 27, Def.-Int. II's Conf. Ex 3 at 1, supp. questionnaire para. 3 (Mar. 15, 2001) ("CSC's Questionnaire II"). Commerce further directed China Steel to "[f]ully report the [product] characteristics of `leeway' and overrun merchandise following the criteria specified in [the agency's] [Questionnaire [I]." CSC's Questionnaire II, C.R. Doc. 27, Def.-Int. II's Conf. Ex. 3 supp. questionnaire para. 5.

China Steel and Yieh Loong submitted their responses to the supplemental section A questionnaire on March 20, 2001 ("CSC's Mar. 20 Response"). Final Determ., 66 Fed.Reg. at 49,619. On March 21, 2001 and March 26, 2001, China Steel and Yieh Loong submitted additional responses to accompany their March 20, 2001 submission. Id. Also on March 21, 2001, Commerce issued supplemental section D questionnaires to China Steel and Yieh Loong. Id. at 49,620. Both entities...

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