Diamond Sawblades Manufacturers' Coal. v. United States

Citation415 F.Supp.3d 1365
Decision Date16 December 2019
Docket NumberSlip Op. 19-157,Court No. 17-00167
Parties The DIAMOND SAWBLADES MANUFACTURERS' COALITION, Plaintiff, v. UNITED STATES, Defendant, and Bosun Tools Co., Ltd., Defendant-intervenor.
CourtU.S. Court of International Trade

Daniel B. Pickard, Wiley Rein, LLP, of Washington, DC, argued for plaintiff Diamond Sawblades Manufacturers' Coalition. With him on the brief were Maureen E. Thorson and Stephanie M. Bell.

John J. Todor, 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 Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and Franklin E. White, Jr., Assistant Director. Of counsel was Paul Keith, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Alexandra H. Salzman, deKieffer & Horgan, PLLC, of Washington, DC, argued for defendant-intervenor Bosun Tools Co., Ltd. With her on the brief were Gregory S. Menegaz and J. Kevin Horgan.

OPINION AND ORDER

Kelly, Judge:

Before the court is the U.S. Department of Commerce's ("Department" or "Commerce") remand redetermination filed pursuant to the court's order in Diamond Sawblades Mfrs. Coalition v. United States, 42 CIT ––––, Slip Op. 18-146, 2018 WL 5281941 (Oct. 23, 2018) (" DSBs I"). See Remand Redetermination Pursuant to Ct. Remand Order in [ DSBs I ], Apr. 17, 2019, ECF No. 43-1 ("Remand Results").

In DSBs I, the court remanded for further explanation and consideration Commerce's conclusion that Bosun Tools. Co., Ltd. ("Bosun" or "Defendant-Intervenor") had acted to the best of its ability in responding to Commerce's requests for information in the sixth administrative review of the antidumping duty ("ADD") order covering diamond sawblades and parts thereof ("DSBs") from the People's Republic of China ("PRC").1 DSBs I, Slip Op. 18-146 at 18, 25–26 ; see also [DSBs] and Parts Thereof From the [PRC], 82 Fed. Reg. 26,912 (Dep't of Commerce June 12, 2017) (final results of ADD admin. review; 20142015) ("Final Results"), and accompanying Issues and Decision Memo. for the Admin. Rev. of [ADD] Order on [DSBs] from the [PRC], A-570-900, June 6, 2017, ECF No. 18-4 ("Final Decision Memo.").

Bosun challenges Commerce's remand redetermination as arbitrary and capricious and as unsupported by substantial evidence, and requests the court to remand the case. See Def.-Intervenor [Bosun] Cmts. Remand Redetermination at 3–24, June 3, 2019, ECF No. 47 ("Bosun's Br."). Defendant and Plaintiff Diamond Sawblades Manufacturers' Coalition ("DSMC") request the court to uphold the Remand Results in its entirety. See Def.'s Resp. [Bosun Br.] at 1, 8–18, July 25, 2019, ECF No. 51 ("Def.'s Resp. Br."); see also Pls.' Resp. [Bosun Br.] at 3–18, July 25, 2019, ECF No. 52 ("Pls.' Resp. Br."). For the following reasons, the court sustains Commerce's Remand Results.

BACKGROUND

The court assumes familiarity with the facts as discussed in the prior opinion, see DSBs I, Slip. Op. 18-146 at 2–7, 18–21, and here recounts those facts relevant to the court's review of the Remand Results. In this sixth administrative review ("POR") of the ADD order on DSBs,2 Commerce selected Bosun as a mandatory respondent following the withdrawal of certain petitioners' requests for review.3 See Antidumping and Countervailing Duty Administrative Reviews, 81 Fed. Reg. 736 (Dep't Commerce Jan. 7, 2016) (initiation); Selection of Respondents for Individual Examination at 5, PD 29, bar code 3438973-01 (Feb. 5, 2016) ("Respondent Selection Memo."); Selection of an Additional Respondent for Individual Examination at 1–2, PD 166, bar code 3463908-01 (Apr. 27, 2016).4

Throughout the POR, Bosun sold DSBs manufactured in Thailand and the PRC through its U.S. affiliates Bosun Tools, Inc. ("Bosun USA") and Pioneer Tools, Inc. ("Pioneer"). See Final Decision Memo. at 21. Bosun's U.S. affiliates did not record the country of origin of DSBs when selling to U.S. customers. Id. at 26–27. As a result, Bosun reconstructed the country of origin for its affiliates' sales through a three-step procedure ("sales identification methodology"), including the application of a first-in, first-out ("FIFO") methodology.5 See id. at 27–28. Commerce verified Bosun's sales identification methodology and did not determine it "to be inaccurate." Id. at 27. Commerce also did not find that "Bosun was inattentive, careless, or inadequate in keeping the country of origin record[.]" Id. at 28. Although Commerce found that Bosun could not replicate the reported result of the FIFO methodology to one pre-selected sale at verification, Commerce considered this deficiency a "minor error" that was "limited to this sale[ ] ... only" and accepted Bosun's sales identification procedure. Id. Commerce also found Bosun complied with the "best of its ability standard" because "Bosun was able to segregate the sales of subject merchandise using its sales identification methodology[.]" Id. at 27–28. Therefore, Commerce declined to apply facts otherwise available with an adverse inference, as urged by petitioner DSMC.6 Id. Commerce calculated a weighted-average dumping margin of 6.19% for Bosun. See Final Results, 82 Fed. Reg. at 26,912.

In DSBs I, the court faulted Commerce for failing to explain how Bosun acted to the "best of its ability" when Bosun had failed to record the country of origin of its sales. See DSBs I, Slip Op. 18-146 at 14. As an interested party, Bosun is required to anticipate the information needed for administrative proceedings, yet it did not record country of origin data. Id.; see also Peer Bearing Corp. v. United States, 766 F.3d 1396, 1400 (Fed. Cir. 2014) ; Nippon Steel Corp. v. United States, 337 F.3d 1373, 1382 (Fed. Cir. 2003). The court therefore remanded Commerce's Final Results for further clarification or reconsideration.7 See DSBs I, Slip Op. 18-146 at 18, 26.

On remand, Commerce found that Bosun failed to act to the best of its ability, because Bosun could have maintained country of origin information for its sales of subject merchandise but did not, and, therefore, Bosun failed to provide information in the manner and form requested and impeded the proceeding. See Remand Results at 1–2, 9–14, 21–26. Moreover, Commerce found that the information that Bosun did submit could not be verified. See id. at 9, 24. Commerce therefore determined Bosun's ADD rate based entirely on facts otherwise available and applied an adverse inference. See id. at 13, 25.8 Commerce determined Bosun's ADD rate to be 82.05 percent, the PRC-wide rate. See Remand Results at 13.9

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to section 516A(a)(2)(B)(i) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(i) (2012)10 and 28 U.S.C. § 1581(c) (2012), which grant the court authority to review actions contesting the final determination in an investigation of an antidumping duty 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). "The results of a redetermination pursuant to court remand are also reviewed ‘for compliance with the court's remand order.’ " Xinjiamei Furniture (Zhangzhou) Co. v. United States, 38 CIT ––––, ––––, 968 F. Supp. 2d 1255, 1259 (2014) (quoting Nakornthai Strip Mill Public Co. v. United States, 32 C.I.T. 1272, 1274, 587 F. Supp. 2d 1303, 1306 (2008) ).

DISCUSSION

Bosun argues that no "necessary information" regarding Bosun's U.S. sales was missing from the record that requires Commerce to rely on facts otherwise available, because Bosun identified country of origin through its sales identification methodology. See Bosun's Br. at 5–10. Bosun avers that it acted to the "best of its ability" and contends that Commerce's determination to apply AFA is arbitrary and capricious and unsupported by substantial evidence. See id. at 17–24. Defendant and DSMC respond that Bosun's failure to maintain direct country of origin records does not satisfy the "best of its ability standard" and warrants the application of AFA to Bosun. See Def.'s Resp. Br. at 1–2, 8–18; see also Pls.' Resp. Br. at 3–18. For the reasons that follow, Commerce's decision to apply AFA to Bosun is not arbitrary or capricious, is supported by substantial evidence, and complies with the court's remand order.

To calculate a dumping margin for merchandise from a non-market economy ("NME") such as the PRC, Commerce compares a product's U.S. price with a normal value, calculated with information placed on the record by the parties. 19 U.S.C. § 1677b(b)(c). Commerce is required to rely on "facts otherwise available" where, inter alia, "necessary information is not available on the record" or where a party fails to provide information "in the form and manner requested[,]" "significantly impedes a proceeding[,]" or provides information that "cannot be verified[.]" See 19 U.S.C. § 1677e(a)(1)(2). However, should a party submit information that does not fully comply with all requirements, Commerce must consider that information, if, inter alia, the party demonstrates that it has acted to the "best of its ability" and that information "can be verified[.]" See 19 U.S.C. § 1677m(e).11

Should a party fail to meet the "best of its ability" standard, Commerce may use inferences adverse to that party to select from among the facts otherwise available. Id. § 1677e(b) ; see also Nippon Steel Corp., 337 F.3d at 1382.

Commerce reasonably applied facts otherwise available because it found information necessary to its determination was missing from the record. Bosun did not provide Commerce the requested direct country of origin information, which "is unquestionably necessary to distinguishing U.S. sales of subject merchandise and to determining accurate duty margins" and "among the most basic...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT