Diamond Sawblades Manufacturers' Coal. v. United States

• Decision Date: 27 October 2021
• Docket Number: Slip Op. 21-150,Court No. 17-00167
• Citation: 547 F.Supp.3d 1323
• Parties: The DIAMOND SAWBLADES MANUFACTURERS’ COALITION, Plaintiff, v. UNITED STATES, Defendant, and Bosun Tools Co., Ltd., Defendant-Intervenor.
• Court: U.S. Court of International Trade

547 F.Supp.3d 1323

The DIAMOND SAWBLADES MANUFACTURERS’ COALITION, Plaintiff,

v. UNITED STATES, Defendant,andBosun Tools Co., Ltd., Defendant-Intervenor.

Slip Op. 21-150

Court No. 17-00167

United States Court of International Trade.

October 27, 2021

Daniel B. Pickard, Maureen E. Thorson, and Stephanie M. Bell, Wiley Rein LLP, of Washington, DC, argued for plaintiff Diamond Sawblades Manufacturers’ Coalition.

John J. Todor, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, argued for defendant United States. Of counsel was Paul K. Keith, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce of Washington, DC.

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

OPINION

Kelly, Judge:

Before the court is the U.S. Department of Commerce's ("Commerce") remand redetermination filed pursuant to the court's order for further proceedings in accordance with Diamond Sawblades Mfrs.’ Coal. v. United States, 986 F.3d 1351 (Fed. Cir. 2021) ; Final Remand Redetermination, Diamond Sawblades Mfrs.’ Coal. v. United States, Ct. No. 17-00167, Appeal No. 20-1478, July 13, 2021, ECF No. 74-1 ("Second Final Remand Redetermination"); see Order, Mar. 25, 2021, ECF No. 71; see also Diamond Sawblades, 986 F.3d 1351. In its opinion, the U.S. Court of Appeals for the Federal Circuit ("Court of Appeals") instructed Commerce to reconsider its application of facts otherwise available with an adverse inference ("AFA")¹ to sales of which the country-of-origin information was determined using the product code or unit price. Diamond Sawblades, 986 F.3d at 1367. Defendant-intervenor Bosun Tools Co., Ltd. ("Bosun") challenges Commerce's remand redetermination as not supported by substantial evidence and contrary to law and requests that the court remand the case. See Def.-Intervenor [Bosun]’s Comments on Second Remand Redetermination, Aug. 12, 2021, ECF No. 78 ("Bosun's Second Remand Comments"). Defendant United States and Plaintiff Diamond Sawblades Manufacturers’ Coalition ("DSMC") request that the court uphold the Second Final Remand Redetermination in its entirety. Pl. [DSMC]’s Revised Resp. to [Bosun's Second Remand Comments] (Confidential Version), Sept. 13, 2021, ECF No. 81 ("DSMC Resp."); Def.’s Resp. to Comments on Remand Results, Sept. 13, 2021, ECF No. 79 ("Def.’s Resp."). For the following reasons, the court sustains Commerce's Second Final Remand Redetermination.

BACKGROUND

In 2006 Commerce issued an antidumping duty order covering "diamond sawblades and parts thereof" ("sawblades") imported from the People's Republic of China ("China"). Diamond Sawblades and Parts Thereof from [China], 71 Fed. Reg. 29,303 (Dep't Com. May 22, 2006) (final deter. of sales at less than fair value and final partial affirmative deter. of critical circumstances). On April 27, 2016, Commerce selected Bosun, a Chinese exporter and producer of sawblades, for individual investigation during the sixth annual administrative review. Selection of an Additional Respondent for Individual Examination in the 2014-2015 Antidumping Duty Admin. Rev. at 1–2, PD 166, CD 117, Doc. No. 3463908-01 (Apr. 27, 2016). Sawblades produced by Bosun are sent to Bosun Tools, Inc., one of two of its U.S. importer-affiliates. Letter from deKieffer & Horgan, PLLC to Sec'y Com., re: Diamond Sawblades from [China] – Sections C & D Questionnaire Resp. at C-1, P.R. 207-210, C.R. 132-143, Doc. No. 3483626-01 (July 1, 2016) ("2016 Questionnaire Resp."); Second Final Remand Redetermination at 2. Bosun's second importer-affiliate, Pioneer Tools Inc. imports sawblades from Thailand not covered by the antidumping order. 2016 Questionnaire Resp. at C-1–2; Second Final Remand Redetermination at 2. Bosun's importer-affiliates sold sawblades to one another. 2016 Questionnaire Resp. at C-1–2.

To calculate Bosun's antidumping margin, Commerce needed to identify the origin of the sawblades sold by the importer-affiliates, information that neither Bosun nor its importer-affiliates recorded. Second Final Remand Redetermination at 2; see 2016 Questionnaire Resp. at C-1–3. Bosun attempted to collect country-of-origin information using three methods: (1) identifying the product code, which in some cases was specific to the country of origin; (2) identifying the unit price; and (3) making an inference that importer-affiliates generally sold product using a first-in, first-out ("FIFO") method. 2016 Questionnaire Resp. at C-2–3; Second Final Remand Redetermination at 2. Commerce determined that the information provided by Bosun was reliable despite a discrepancy² uncovered during the verification of the FIFO methodology and assigned Bosun a weighted average dumping margin of 6.19 percent. Verification of the U.S. Sales Resp. of [Bosun] at 10–11, PD 383, CD 365, Doc. No. 3573591-01 (May 17, 2017) ("Verification Report"); Diamond Sawblades and Parts Thereof from [China], 82 Fed. Reg. 26,912, 26,912 (Dep't Com. June 6, 2017) (final results of antidumping duty admin. rev.; 2014-2015) ("Final Results") and accompanying Issues and Decision Memo. at 25–27, Doc. No. 3578943-01 (June 6, 2017) ("Final Decision Memo."); see Second Final Remand Redetermination at 2.

The domestic-industry DSMC challenged inter alia, Commerce's decision not to use AFA before this court.³ [DSMC's] Memo. in Supp. of Rule 56.2 Mot. for J. on Agency R., Dec. 5, 2017, ECF No. 28; see Diamond Sawblades Mfrs.’ Coal. v. United States, 42 CIT ––––, Slip op. 18-146 (Oct. 23, 2018) ("Slip Op. 18-146"). This court concluded Commerce's determination was at odds with the Court of Appeals’ precedent regarding the "best of its ability" standard and remanded for clarification or reconsideration. Slip Op. 18-146 at 7–14. Commerce issued the Final Remand Redetermination on April 17, 2019, using AFA for all of Bosun's sales of sawblades during the review period due to the unreliability of the FIFO methodology. Final Remand Redetermination [Slip Op. 18-146], Apr. 17, 2019, ECF No. 43-1 ("First Remand Redetermination"). Bosun challenged the redetermination before this court, which affirmed Commerce's determination. Diamond Sawblades Mfrs.’ Coal. v. United States, 43 CIT ––––, ––––, 415 F. Supp.3d 1365 (2019). Bosun appealed to the Court of Appeals. Diamond Sawblades, 986 F.3d at 1351.

On appeal, Bosun challenged Commerce's decision to disregard all the origin data Bosun provided and the application of facts otherwise available, as unsupported by substantial evidence.⁴ Id. at 1362. The Court of Appeals determined that it was unclear whether country-of-origin information obtained for sales using the product code or unit price was unreliable, and therefore, the decision to disregard all of the country-of-origin information was unsupported by substantial evidence. Id. at 1366. The Court of Appeals remanded to determine whether substantial evidence existed to support a finding that the country-of-origin information determined using the product code or unit price was unreliable. Id. at 1367. If Commerce determined that there was no basis for the application of facts otherwise available to sales other than the sales where the country of origin was determined using the FIFO methodology ("FIFO Sales"), the Court of Appeals instructed Commerce to redetermine how adverse inferences applied to the matter. Id. On March 25, 2021, this court remanded the case to Commerce for proceedings consistent with the Court of Appeals’ opinion in Diamond Sawblades. Order, Mar. 25, 2021, ECF No. 71.

On July 13, 2021, Commerce filed its Second Final Remand Redetermination. Second Final Remand Redetermination. On August 12, 2021, Bosun filed its comments on the Second Final Remand Redetermination. Bosun's Second Remand Comments. DSMC filed its comments on September 14, 2021. DSMC Resp.

JURISDICTION AND STANDARD OF REVIEW

This court has jurisdiction pursuant to section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii)⁵ and 28 U.S.C. § 1581(c) (2018), which grant the court authority to review actions contesting the final determination in an administrative review 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 (2008) ).

DISCUSSION

Commerce reviewed its application of AFA to the country-of-origin information supplied by Bosun. Second Final Remand Redetermination at 4–5. Commerce determined that there were no reliability issues with the country-of-origin information derived from methods using the product code or unit price and did not select from the facts otherwise available for sales using those methodologies. Id. at 4. Commerce continued to find the FIFO methodology unreliable and determined that resorting to AFA remained warranted for the FIFO Sales. Id. at 4–5. Bosun challenges the application of adverse inferences to the FIFO Sales arguing that Commerce should apply neutral facts instead. Bosun's Second Remand Comments at 8–12. In the alternative, Bosun argues that if AFA is applied, the scope of its application should be limited to the missing country-of-origin information for the FIFO Sales. Id. at 12–15. Bosun also challenges the inclusion of intracompany sales in Commerce's calculations. Id. at 5–8. Finally, the court reviews Commerce's decision to use the Thai surrogate value for valuing copper

powder and copper iron clab for compliance with this court's previous...