Consolidated Fibers, Inc. v. U.S.

• Decision Date: 20 August 2008
• Docket Number: Slip Op. 08-85. Court No. 07-00233.
• Citation: 574 F.Supp.2d 1371
• Parties: CONSOLIDATED FIBERS, INC. and Stein Fibers, Ltd., Plaintiffs, v. UNITED STATES, Defendant, and DAK Americas LLC, Nan Ya Plastics Corp. America and Wellman, Inc., Defendant-Intervenors.
• Court: U.S. Court of International Trade

574 F.Supp.2d 1371

CONSOLIDATED FIBERS, INC. and Stein Fibers, Ltd., Plaintiffs, v. UNITED STATES, Defendant, and DAK Americas LLC, Nan Ya Plastics Corp. America and Wellman, Inc., Defendant-Intervenors.

Slip Op. 08-85. Court No. 07-00233.

United States Court of International Trade.

August 20, 2008.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

DeKieffer & Horgan, (Gregory S. Menegaz) for Plaintiffs, Consolidated Fibers, Inc. and Stein Fibers, Ltd.

James M. Lyons, General Counsel; Neal J. Reynolds, Assistant General Counsel, Office of the General Counsel, United States International Trade Commission (Karl S. Von Schriltz), for Defendant, United States.

Kelley Drye & Warren, LLP, (Paul C. Rosenthal; Kathleen W. Cannon; David C. Smith, Jr.) for Defendant-Intervenors, DAK Americas LLC, Nan Ya Plastics Corp. America and Wellman, Inc.

OPINION

NICHOLAS TSOUCALAS, Senior Judge.

This matter is before the Court on motion for judgment upon the agency record brought by plaintiffs Consolidated Fibers, Inc. and Stein Fibers, Ltd. ("Plaintiffs") pursuant to USCIT Rule 56.2. Plaintiffs challenge aspects of the final affirmative determination by the United States International Trade Commission ("Commission" or "ITC") in Certain Polyester Staple Fiber From China ("Final Determination"), Inv. No. 731-TA-1104, USITC Pub. 3922 (June 2007) (CR 335).¹ Domestic producers DAK Americas LLC, Nan Ya Plastics Corp. America and Wellman, Inc. join as Defendant-Intervenors.

JURISDICTION

The Court has jurisdiction pursuant to 28 U.S.C. § 1581(c) and 19 U.S.C. § 1516a(a)(2)(B)(i).

BACKGROUND

On June 23, 2006, the Commission instituted an antidumping investigation on certain polyester staple fiber ("PSF") from the People's Republic of China ("PRC") upon receipt of a petition filed by domestic producers DAK Americas LLC, Nan Ya Plastics Corp. America and Wellman, Inc. See Certain Polyester Staple Fiber From China, 71 Fed.Reg. 37,097 (June 29, 2006).

In August 2006, the Commission issued an affirmative preliminary determination and instituted the final phase investigation. See Certain Polyester Staple Fiber From China, 71 Fed.Reg. 46,241 (August 11, 2006).

On December 18, 2006, the Commission issued draft questionnaires with an accompanying memorandum requesting comments on those questionnaires. See Memorandum from Robert Carpenter to Parties dated December 18, 2006 (PR 163).² Domestic producers submitted comments on the draft questionnaires asking the Commission to collapse pricing of certain PSF made from virgin materials ("virgin PSF") and PSF made from regenerated or recycled materials ("regenerated PSF"). These domestic producers argued that regenerated PSF and virgin PSF were one like product and they were found to be directly competing in the market. See Petitioners' Comments on Draft Questionnaires dated December 21, 2006 (CR 115). Based on the comments received, the Commission determined to request pricing data on PSF without regard for input materials. Reviewing the pricing information, the Commission found that underselling by imports occurred in 37 of 54 instances. See Final Report V-16 (CR 315).

A notice of the schedule for the final phase investigation was published on January 11, 2007. See 72 Fed.Reg. 1341. A notice of the revised schedule was published on February 16, 2007. See 72 Fed.Reg. 7676. The revised schedule called for prehearing briefs to be filed by March 6, 2007, a hearing to be held on March 13, 2007 and posthearing briefs to be filed by March 22, 2007. See id. Parties were also invited to file comments on Commerce's final determination by April 16, 2007. See id.

On May 8, 2007, the Commission closed its record. On May 10, 2007, Plaintiffs filed their final comments. On May 14, 2007, the Commission staff issued a memorandum identifying certain portions of Plaintiffs' final comments as new factual information. See Memorandum INV-EE-050 (May 14, 2007) (PR 126).

On May 15, 2007, the Commission voted unanimously that subject imports of PSF from China had caused present material injury to domestic producers of the like product. The Commission's views and determinations were published in June 2007. See 72 Fed.Reg. 30,394 (May 31, 2007).

Plaintiffs contend that the Commission's affirmative material injury determination was unsupported by substantial evidence and otherwise contrary to law because the Commission failed to distinguish between virgin PSF and regenerated PSF, and to consider the color of PSF in pricing comparisons. See Mot. For J. Upon The Agency R. On Behalf Of Consolidated Fibers, Inc. and Stein Fibers, Ltd. ("Pls.' Mem.") at 1. The Commission responds that the Final Determination was supported by substantial evidence and otherwise in accordance with law and requests that the Court affirm it. See Mem. Of Def. United States International Trade Commission In Opp'n To Pls.' Mot. For Summ. J. On The Agency R. ("ITC Mem.") at 1. Defendant-Intervenors' arguments are not addressed separately where they parallel those of the Commission. See Defendant-Intervenors' Resp. Br. ("Domestic Producers' Resp.").

STANDARD OF REVIEW

The Court will uphold an ITC 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) (2000).

DISCUSSION

I. Statutory Framework and the Final Determination

Pursuant to 19 U.S.C. § 1671d(b), the Commission is charged with determining whether a domestic industry is materially injured by reason of a subject import. Material injury is defined as "harm [to the domestic industry] which is not inconsequential, immaterial, or unimportant." 19 U.S.C. § 1677(7)(A). To find material injury, the Commission must find a present material injury or a threat thereof and causation of such harm by reason of subject imports. See Hynix Semiconductor, Inc. v. United States, ___ CIT ____, 431 F.Supp.2d 1302, 1306 (2006) (citation omitted). "When determining whether subject imports have caused material injury to the domestic industry, the Commission must evaluate three factors: (1) the volume of subject imports; (2) the price effects of subject imports on domestic like products; and (3) the impact of subject imports on the domestic producers of domestic like products." See id. (citing 19 U.S.C. § 1677(7)(B)(i)(I)-(III)). In addition, the Commission "`may consider such other economic factors as are relevant to the determination.'" Id. (quoting 19 U.S.C. § 1677(7)(B)(ii)).

II. The Commission's Disregard of Plaintiffs' Final Comments

In the Final Determination, the Commission disregarded certain portions of Plaintiffs' final comments upon finding that they constituted new factual information. See Memorandum INV-EE-050 (May 14, 2007) (PR 126). The disregarded information concerned the distinctions between virgin PSF and regenerated PSF. See Pls.' Mem. at 7. Plaintiffs contend that the Commission acted unreasonably because the facts they alleged in the final comments were "clear from the administrative record before the Commission." Id. Plaintiffs thus argue that the Final Determination is unsupported by substantial evidence because the Commission failed to consider these disregarded facts. See id. at 10.

Defendant responds that Plaintiffs' final comments were improperly styled as miniature hearing briefs to make arguments that could have been made earlier and included new factual information contrary to statutory and regulatory requirements set forth in 19 U.S.C. § 1677m(g) and 19 C.F.R. § 207.30(b). See Def.'s Mem. at 15-16. Moreover, Defendants contend that some facts contained in Plaintiffs' final comments were without citation to record documents and others were explicitly drawn from the record before the United States Department of Commerce ("Commerce"). See id. at 17. As such, Defendant states that it reasonably identified and disregarded new factual information.

The Commission's disregard of the certain factual information in Plaintiffs' final comments was reasonable and consistent with the law. The statute directs the Commission as follows:

Information that is submitted on a timely basis to the administering authority or the Commission during the course of a proceeding under this subtitle shall be subject to comment by other parties to the proceeding within such reasonable time as the administering authority or the Commission shall provide. The administering authority and the Commission, before making a final determination ... shall cease collecting information and shall provide the parties with a final opportunity to comment on the information obtained by the administering authority or the Commission (as the case may be) upon which the parties have not previously had an opportunity to comment. Comments containing new factual information shall be disregarded.

19 U.S.C. § 1677m(g). Thus, the statute not only requires the Commission to disregard new factual information, it provides that a party may comment on information upon which it has not previously had an opportunity to comment. The Commission's regulations contain a similar provision, which provides, in relevant part:

The parties shall have an opportunity to file comments on any information disclosed to them after they have filed their posthearing brief pursuant to § 207.25. Comments shall only concern such information[.] A comment may address the accuracy, reliability, or probative value of such information by reference to information elsewhere in the record, in which case the comment shall identify where in the record such information is found. Comments containing new factual information shall be disregarded.

19 C.F.R. § 207.30(b).

The Court agrees with the Commission that Plaintiffs improperly fashioned its final comments as briefs to belatedly make arguments it should have made earlier in the investigation. In addition, the Court finds that the Commission properly disregarded portions of Plaintiffs' final comments. The...