Coal. for Fair Trade of Hardwood Plywood v. U.S. Int'l Trade Comm'n

• Decision Date: 08 June 2016
• Docket Number: Slip Op. 16-57,Court No. 14-00013
• Citation: 180 F.Supp.3d 1137
• Parties: The Coalition for Fair Trade of Hardwood Plywood, Plaintiff, v. United States International Trade Commission, Defendant, American Alliance for Hardwood Plywood, et al., Defendant-Intervenors, and China National Forest Products Industry Association and Members, Defendant-Intervenors.
• Court: U.S. Court of International Trade

180 F.Supp.3d 1137

The Coalition for Fair Trade of Hardwood Plywood, Plaintiff,

v.United States International Trade Commission, Defendant,American Alliance for Hardwood Plywood, et al., Defendant-Intervenors,andChina National Forest Products Industry Association and Members, Defendant-Intervenors.

Slip Op. 16-57

Court No. 14-00013

United States Court of International Trade.

Signed June 8, 2016

Jeffrey S. Levin, Levin Trade Law, P.C., of Bethesda, MD, argued for plaintiff.

Charles A. St. Charles, Attorney-Advisor, Office of General Counsel, United States International Trade Commission, of Washington, DC, argued for defendant. With him on the brief were Rhonda M. Hughes, Attorney-Advisor, Dominic L. Bianchi, General Counsel, and Robin L. Turner, Acting Assistant General Counsel for Litigation.

Jeffrey S. Grimson, Mowry & Grimson, PLLC, of Washington, DC, argued for defendant-intervenors American Alliance for Hardwood Plywood et al. With him on the brief were Kristin H. Mowry, Jill A. Cramer, Sarah M. Wyss, and Daniel R. Wilson.

Jeffrey S. Neeley, Husch Blackwell LLP, of Washington, DC, argued for defendant-intervenors China National Forest Products Industry Association and its members. With him on the brief was Michael S. Holton.

OPINION

EATON

, Judge:

Before the court is the motion for judgment on the agency record, pursuant to USCIT Rule 56.2

, of the Coalition for Fair Trade of Hardwood Plywood (“plaintiff” or the “Coalition”), an association of domestic hardwood plywood manufacturers. See Pl.'s Rule 56.2 Mem. in Supp. for J. Upon the Agency R. (ECF Dkt. No. 42–1) (“Pl.'s Br.”). By its motion, plaintiff contests the final negative material injury and threat of material injury determinations of the United States International Trade Commission (“ITC” or the “Commission”) in its antidumping and countervailing duty investigations of hardwood plywood from the People's Republic of China (“China”). See Hardwood Plywood From China , 78 Fed. Reg. 76,857 (Int'l Trade Comm'n Dec. 19, 2013)

(determinations) (“Final Determinations”).

The Commission opposes plaintiff's motion, asking the court to sustain its determinations. Def. ITC's Opp'n to Pl.'s Mot. for J. on the Agency R. (ECF Dkt. No. 49) (“Def.'s Br.”). Defendant-intervenors, the China National Forest Products Industry Association and its individual members¹ (the “Chinese defendant-intervenors”), all of which are Chinese producers and exporters of hardwood plywood, and the American Alliance for Hardwood Plywood and other American hardwood plywood importers² (the “American defendant-intervenors”) join the Government in opposing plaintiff's motion. See Chinese Def.-Ints.' Resp. in Opp'n to the Coalition's Mot. for J. on the Agency R. (ECF Dkt. No. 55) (“Chinese Def.-Ints.' Br.”); Def.-Ints. Am. Alliance for Hardwood Plywood's Resp. in Opp'n to Pl.'s Rule 56.2

Mot. for J. on the Agency R (ECF Dkt. No. 53) (“Am. Def.-Ints.' Br.”). For the reasons discussed herein, the Final Determinations are remanded.

BACKGROUND

The antidumping and countervailing duty investigations at issue involved hardwood plywood from China (“subject imports”). “Hardwood plywood is a wood panel product made by gluing two or more layers of wood veneer³ to a core that may itself be composed of veneers or other types of wood material such as medium density fiberboard[,] ... particleboard, lumber, or oriented strand board.” Views of the Commission (Final) at 8, CD 343 at bar code 522998 (Int'l Trade Comm'n Nov. 25, 2013) (ECF Dkt. No. 28–1) (“Views”). It is manufactured in a variety of thicknesses and is typically used in “furniture, kitchen cabinets, architectural woodwork, wall paneling, manufactured homes, and recreational vehicles.” Id. at 9. “Hardwood plywood products are differentiated by species, quality of veneer, thickness, number of plies, type of core (veneer, particleboard, [medium density fiberboard], or other), and the type of adhesive used in the manufacturing process.” Id.

On September 27, 2012, members of the Coalition filed an antidumping and countervailing duty petition with the United States Department of Commerce (“Commerce”) and the ITC. Petition for the Imposition of Antidumping and Countervailing Duties, Inv. Nos. 701-TA-490

and 731–TA–1204 (Final) CD 1 at bar code 491972 (Sept. 27, 2012) (“the Petition”). Thereafter, Commerce and the ITC initiated antidumping and countervailing duty investigations of imports of hardwood plywood from China. See

Hardwood and Decorative Plywood From China , 77 Fed. Reg. 65,172 (Dep't of Commerce Oct. 25, 2012) (initiation of antidumping duty investigation); Hardwood and Decorative Plywood From China , 77 Fed. Reg. 64,955 (Dep't of Commerce Oct. 24, 2012) (initiation of countervailing duty investigation). Commerce sought to determine whether hardwood and decorative plywood from China was being sold at less than fair value, and whether the industry was receiving countervailable subsidies.

On September 23, 2013, Commerce found that subject merchandise was indeed being sold at less than fair value, and determined final dumping margins ranging from 55.76 percent to 121.65 percent. Hardwood and Decorative Plywood From China , 78 Fed. Reg. 58,273, 58,276

–82 (Dep't of Commerce Sept. 23, 2013) (final determination of sales at less than fair value). Commerce also made an affirmative countervailing duty determination, finding all but three mandatory respondents were receiving subsidies, and determining countervailing duty rates ranging from 13.58 percent to 27.16 percent. Hardwood and Decorative Plywood from China , 78 Fed. Reg. 58,283, 58,283 –84 (Dep't of Commerce Sept. 23, 2013) (final affirmative countervailing duty determination).

The ITC simultaneously conducted an investigation to determine whether a domestic industry was materially injured or threatened with material injury by reason of imports of subject merchandise. The Commission's period of investigation (“POI”) was January 1, 2010 through June 30, 2013, extending back two years prior to the Coalition's filing of the Petition. Views at 4. During the Commission's investigation, domestic industry data was collected from the questionnaire responses of eight domestic producers that produced nearly all of the U.S. hardwood plywood in 2012. See Views at 4; Final Staff Report, Inv. Nos. 701-TA-490

and 731–TA–1204 (Final) at III-2, CD 337 at bar code 520495 (Oct. 25, 2013) (ECF Dkt. No. 28–2) (“Final Staff Report”). U.S. import information was based on Commerce's import statistics and the questionnaire responses of forty-two U.S. importers of hardwood plywood from China, representing 66.3 percent of total imports from China. Views at 4; Final Staff Report at IV-1. The Views of the Commission were also based on questionnaire responses from eighty-nine foreign producers that collectively produced approximately 52.4 percent of hardwood plywood imported into the United States from China in 2012. Views at 4; Final Staff Report at VII-3.

On November 13, 2012, the ITC issued a unanimous preliminary affirmative material injury determination. See Hardwood Plywood From China , 77 Fed. Reg. 71,017, 71,017 (Int'l Trade Comm'n Nov. 28, 2012)

(preliminary determination) (“On the basis of the record developed in the subject investigations, the [Commission] determines ... there is a reasonable indication that a [United States] industry is materially injured by reason of imports of hardwood plywood from China that are allegedly subsidized and sold in the United States at less than fair value ....”). Prior to making its final material injury determination, the ITC held a public hearing on September 19, 2013, and the interested parties submitted pre- and post-hearing briefs. Final Phase Hearing Transcript, Inv. Nos. 701-TA-490

and 731–TA–1204 (Final) PD 173 at bar code 518726 (Sept. 20, 2013) (ECF Dkt. Nos. 58–2, 58–3) (“Final Phase Hearing Tr.”); Pl.'s Pre-Hearing Br., Inv. Nos. 701-TA-490 and 731–TA–1204 (Final) PD 152 at bar code 518098 (Sept. 12, 2013) (ECF Dkt. No. 58–1) (“Pl.'s Pre–Hearing Br.”); Am. Def.-Ints.' Pre-Hearing Br., Inv. Nos. 701-TA-490 and 731–TA–1204 (Final) CD 322 at bar code 518031 (Sept. 11, 2013) (ECF Dkt. No. 58-1) (“Am. Def.-Ints.' Pre-Hearing Br.”); Pl.'s Post-Hearing Br., Inv. Nos. 701-TA-490 and 731–TA–1204 (Final) CD 329 at bar code 519156 (Sept. 25, 2013) (ECF Dkt. No. 44 Tab 3) (“Pl.'s Post-Hearing Br.”); Am. Def.-Ints.' Post-Hearing Br., Inv. Nos. 701-TA-490 and 731–TA–1204 (Final) CD 325 at bar code 519112 (Sept. 25, 2013) (ECF Dkt. No. 58-3) (“Am. Def.-Ints.' Post-Hearing Br.”); Chinese Def.-Ints.' Post-Hearing Br., Inv. Nos. 701-TA-490 and 731–TA–1204 (Final) CD 326 at bar code 519113 (Sept. 25, 2013) (ECF Dkt. No. 61 Tab 2) (“Chinese Def.-Ints.' Post-Hearing Br.”). The Commission issued its Final Staff Report on October 25, 2013. See Final Staff Report.

On November 5, 2013, the ITC reversed course and determined that the plywood industry in the United States was not materially injured or threatened by material injury by reason of hardwood plywood imports from China. See Final

Determinations , 78 Fed. Reg. at 76,857 (“On the basis of the record developed in the subject investigations, the [Commission] determines ... that an industry in the United States is not materially injured or threatened with material injury.”). Plaintiff contests the Commission's final negative material injury and threat of material injury determinations before this court.

This court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (2012)

.

STANDARD OF REVIEW

When reviewing the Commission's material injury determinations, “[t]he court shall hold unlawful any determination, finding, or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i) (2012)

. “Substantial evidence is defined as ‘more than a mere scintilla,’ as well as evidence that a ‘reasonable mind might accept as adequate to support a conclusion.’ ” Mukand, Ltd. v. United...