Coal. for Fair Trade in Garlic v. United States

• Decision Date: 14 April 2020
• Docket Number: Slip Op. 20-48,Court No. 18-00137
• Citation: 437 F.Supp.3d 1347
• Parties: COALITION FOR FAIR TRADE IN GARLIC, Plaintiff, v. UNITED STATES, Defendant, and Harmoni International Spice, Inc., et al., Defendant-Intervenors.
• Court: U.S. Court of International Trade

437 F.Supp.3d 1347

COALITION FOR FAIR TRADE IN GARLIC, Plaintiff,

v.UNITED STATES, Defendant,andHarmoni International Spice, Inc., et al., Defendant-Intervenors.

Slip Op. 20-48

Court No. 18-00137

United States Court of International Trade.

April 14, 2020

Brodie H. Smith and Anthony L. Lanza, Lanza and Smith PLC, of Irvine, CA, for Plaintiff Coalition for Fair Trade in Garlic.

Meen Geu Oh, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for Defendant United States. With him on the brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel on the brief was Emma T. Hunter, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Michael J. Coursey, John M. Herrmann, and Joshua R. Morey, Kelley Drye & Warren LLP, of Washington, DC, for Defendant-Intervenors Fresh Garlic Producers Association and its Individual Members.

Bruce M. Mitchell, Alan G. Lebowitz, Ned H. Marshak, Jordan C. Kahn, and Jamie L. Maguire, Grunfeld Desiderio Lebowitz Silverman & Klestadt LLP, of New York, NY, for Defendant-Intervenors Zhengzhou Harmoni Spice Co., Ltd. and Harmoni International Spice Inc.

OPINION AND ORDER

Barnett, Judge:

In this action, Plaintiff Coalition for Fair Trade in Garlic ("the CFTG") moves for judgment on the agency record pursuant to U.S. Court of International Trade ("CIT") Rule 56.2 in connection with the U.S. Department of Commerce's ("Commerce" or "the agency") final results and partial rescission of the 22nd administrative review ("AR22") of the antidumping duty order on fresh garlic from the People's Republic of China ("China" or "the PRC").¹ See Fresh Garlic From the People's Republic of China , 83 Fed. Reg. 27,949 (Dep't Commerce June 15, 2018) (final results and partial rescission of the 22nd antidumping duty admin. review and final result and rescission, in part, of the new shipper reviews; 2015–2016) (" Final Results "), ECF No. 24-2, and accompanying Issues and Decision Mem., A-570-831 (June 8, 2018) ("I&D Mem."), ECF No. 24-3.²

The CFTG raises two challenges to Commerce's decision to rescind its review of certain Chinese garlic producers and exporters. The CFTG first contends that Commerce's regulation governing the partial rescission of an administrative review upon the withdrawal of request to review a particular producer or exporter, 19 C.F.R. § 351.213(d)(1), violates the statute governing the periodic review of antidumping and countervailable subsidy duties, 19 U.S.C. § 1675(a)(1)–(2)(2012).³ Mot. of Pls. [CFTG] and its Individual Members for J. on the Agency R. and accompanying Mem. in Supp. ("CFTG's Mem.") at 25–35, ECF No. 38. The CFTG next contends that Commerce erred in concluding that its members lacked standing to request a review of Defendant-Intervenor Zhengzhou Harmoni Spice Co., Ltd. Id. at 35–49. Defendant United States ("the Government") and Defendant-Intervenors⁴ argue that Commerce's partial rescission of the administrative review was lawful and supported by substantial evidence. Def.’s Corrected Resp. in Opp'n to Pl.’s, Consol. Pls.’, and Pl.-Ints.’ Rule 56.2 Mots. For J. on the Agency R. ("Gov't's Resp.") at 27–48, ECF No. 74; [FGPA's] Resp. in Opp'n to Pls.’ Mot. for J. on the Agency R. ("FGPA's Resp.") at 18–20, ECF No. 47; Def.-Int. Harmoni's Resp. to Pls.’ Rule 56.2 Mot. for J. on the Agency R ("Harmoni's Resp.") at 4–27, ECF No. 48. For the reasons discussed herein, the court remands for further consideration Commerce's determination based on the CFTG's second challenge and declines to reach the CFTG's first challenge.

BACKGROUND

In 1994, Commerce issued an order imposing antidumping duties on fresh garlic from China. See Fresh Garlic From the People's Republic of China , 59 Fed. Reg. 59,209 (Dep't Commerce Nov. 16, 1994) (Order). On November 4, 2016, Commerce published a notice informing interested parties of the opportunity to request an administrative review of the Order for the period of review November 1, 2015, through October 31, 2016. Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Admin. Review , 81 Fed. Reg. 76,920, 76,921 (Dep't Commerce Nov. 4, 2016), PR 2, PJA Vol. I. Harmoni requested to be included in the review. Request for Admin. Review of the Antidumping Duty Order on Fresh Garlic from the [PRC] (Nov. 7, 2016), PR 1, PJA Vol. I. The CFTG and the FGPA each requested Commerce to include Harmoni, among others, in the review.⁵ CFTG's Request for 22nd Antidumping Admin. Review of Fresh Garlic from the [PRC] (Nov. 28, 2016) ("CFTG Req."), Ex. at 1, PR 8, PJA Vol. I; Pet'rs’ Requests for Admin. Review (Nov. 30, 2016) at 6, PR 12, PJA Vol. I. In its review request, the CFTG characterized itself as "an alliance of domestic garlic producers." CFTG Req. at 1.⁶ However, the CFTG claimed interested party status pursuant to 19 U.S.C. § 1677(9)(C), applicable to individual producers,⁷ and 19 C.F.R. § 351.102(b)(29)(vii), applicable to associations.⁸ Id. at 2.

On January 13, 2017, Commerce initiated AR22. See Initiation of Antidumping and Countervailing Duty Admin. Reviews , 82 Fed. Reg. 4,294, 4,296–97(Dep't Commerce Jan. 13, 2017), PR 22, PJA Vol. I. The review covered 35 exporters and producers. Selection of Respondents for Individual Examination (Mar. 7, 2017) at 3, PR 82, PJA Vol. I. After finding that it would be impracticable to review every named exporter or producer, Commerce selected Harmoni as one of two mandatory respondents in the review. Id. at 4.

On April 6, 2017, Harmoni placed on the AR22 record its case and rebuttal briefs filed in the twenty-first administrative review of the antidumping duty order on fresh garlic from China ("AR21"). See Harmoni Placing [AR]21 Case and Rebuttal Brs. On the Admin. R. in [AR]22 (Apr. 6, 2017) ("Harmoni's AR21 Brs."), CR 19–26, CJA. The briefs consisted of information and documents Harmoni had relied on to impugn the credibility of the domestic coalition that requested Harmoni to be included in AR21 and encourage Commerce to find the request invalid ab initio. See generally id.⁹ Soon thereafter, Harmoni and the FGPA withdrew their requests for Harmoni to be included in the review. Harmoni Withdrawal of Review Request (Apr. 13, 2017), PR 123, PJA Vol. I; Pet'rs’ Withdrawal of Certain Requests for Admin. Review (Apr. 13, 2017) at 2, PR 124, PJA Vol. I.

On June 27, 2017, Commerce issued questions to the CFTG to assess whether its members qualify as domestic interested parties eligible to request an administrative review. Ltr. From Dep't Commerce to Hume & Assoc. Pertaining to CFTG Questionnaire (June 27, 2017), PR 203, PJA Vol. III.¹⁰ The CFTG responded on August 3, 2017. CFTG Resubmission of Resp. to the June 27, 2017 [Dep't Commerce] [L]tr. (Aug. 3, 2017) ("CFTG's 8/3/17 Resp."), CR 89–92, CJA. The CFTG provided information regarding each of its then-members—Mr. Crawford, Ms. Bateman,¹¹ and Ms. Sanford—to demonstrate their status as domestic garlic producers. Id. at 2–3. While Mr. Crawford and Ms. Bateman provided the requested income tax forms (Form 1040 and Schedule F),¹² Ms. Sanford did not. See id. , Apps. 3, 7, 8. Ms. Sanford informed Commerce that because of a "devastating fire" allegedly "on [her] property," she "did not file a Schedule F for the 2015 tax year." Id. , App. 12 at 3. She further reported requesting an extension to file her 2016 taxes and informed Commerce she would provide a copy of her 2016 Schedule F after she filed her taxes. Id. The CFTG also provided information regarding the "credibility and involvement of [Robert T.] Hume," counsel for the CFTG in the administrative proceedings. Id. at 3.

On October 13, 2017, Commerce issued a supplemental questionnaire to the CFTG requesting a copy of Ms. Sanford's request for an extension to file her 2016 taxes and the income tax forms she ultimately filed. Request for Further Information (Oct. 13, 2017) ("Commerce 10/13/17 RFI"), PR 269, PJA Vol. III. The CFTG did not respond by the October 18, 2017 deadline. Cmts. on CFTG Request for Ext. of Time to Submit Suppl. Resp. (Oct. 26, 2017) at 1–2, PR 276, PJA Vol. III.¹³

Commerce published its preliminary results on December 7, 2017. Fresh Garlic From the People's Republic of China , 82 Fed. Reg. 57,718 (Dep't Commerce Dec. 7, 2017) (prelim. results, prelim. rescission, and final rescission, in part, of the 22nd antidumping duty admin. review and prelim. results of the new shipper reviews; 2015–2016); see also Decision Mem. for the Prelim. Results, Prelim. Rescission, and Final Rescission, in Part, of the 2015–2016 Antidumping Duty Admin. Review and Prelim. Results of the New Shipper Reviews (Nov. 28, 2017) ("Prelim. Mem."), PR 315, PJA Vol. IV. Commerce preliminarily determined that "the CFTG's review request was invalid" because of "material misrepresentations and inconsistencies in the statements made by the CFTG" that rendered "all of [its] submissions ... unreliable." Prelim. Mem. at 7.

Commerce explained that "[a]lthough each proceeding is distinct, the fact pattern of the instant administrative review mirrors that of the preceding review, and accordingly, the preceding review provides context to the analysis of the CFTG's standing and credibility." Id. at 8 (footnote citation omitted); see also id. at 8–9 (summarizing the agency's findings in AR21). Commerce reached its conclusion based upon an analysis of the standing of the CFTG members who had submitted the review request; i.e. , Mr. Katz, Mr. Crawford, Ms. Sanford, and Mr. Pino. Id. at 9 (reasoning that "an interested party ... must have standing at the time of the review request"). However, because Mr. Katz and Mr. Pino did not respond to Commerce's questionnaires, Commerce's analysis was limited to the responses of Mr. Crawford and Ms. Sanford. Id. at 13. Commerce made no findings regarding Ms....