Diamond Sawblades Mfrs. Coal. v. United States

• Decision Date: 07 August 2017
• Docket Number: 2016-1253
• Citation: 866 F.3d 1304
• Parties: DIAMOND SAWBLADES MANUFACTURERS COALITION, Plaintiff-Appellee v. UNITED STATES, Defendant-Appellee v. Beijing Gang Yan Diamond Products Company, Gang Yan Diamond Products, Inc., Defendants-Appellants Cliff International, Ltd., Defendant
• Court: U.S. Court of Appeals — Federal Circuit

866 F.3d 1304

DIAMOND SAWBLADES MANUFACTURERS COALITION, Plaintiff-Appellee

v.UNITED STATES, Defendant-Appellee

v.Beijing Gang Yan Diamond Products Company, Gang Yan Diamond Products, Inc., Defendants-Appellants

Cliff International, Ltd., Defendant

2016-1253

United States Court of Appeals, Federal Circuit.

Decided: August 7, 2017

Daniel B. Pickard , Wiley Rein, LLP, Washington, DC, argued for plaintiff-appellee. Also represented by Usha Neelakantan, Maureen E. Thorson .

John Jacob Todor , Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for defendant-appellee. Also represented by Benjamin C. Mizer, Jeanne E. Davidson, Franklin E. White, Jr. ; Amanda T. Lee , Office of Chief Counsel for Trade Enforcement and Compliance, United States Department of Commerce, Washington, DC.

Jeffrey S. Neeley , Husch Blackwell LLP, Washington, DC, argued for defendants-appellants. Also represented by Michael Scott Holton .

Daniel L. Porter , Curtis, Mallet-Prevost, Colt & Mosle LLP, Washington, DC, for amici curiae Shanghai Huayi Group Corporation Limited, China Manufacturers Alliance. Also represented by James P. Durling, Claudia Denise Hartleben ; Gene C. Schaerr , Schaerr Duncan, Washington, DC.

William Alfred Fennell , Stewart & Stewart, Washington, DC, for amici curiae United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC, Titan Tire Corporation. Also represented by Nicholas J. Birch, Lane S. Hurewitz, Terence Patrick Stewart .

Before Lourie, O'Malley, and Taranto, Circuit Judges.

O'Malley, Circuit Judge.

The Advanced Technology & Materials entity ("ATM"), comprised of Beijing Gang Yan Diamond Products Company, Gang Yan Diamond Products, Inc., and other affiliated companies, appeals from a decision of the Court of International Trade ("CIT") upholding the Department of Commerce's ("Commerce") determination in a first administrative review of an earlier-imposed antidumping order.¹ In that review, Commerce imposed an adjusted PRC-wide entity rate of 82.12% on subject goods imported by ATM. See Diamond Sawblades Mfrs. Coal. v. United States (CIT Decision ), 2015 Ct. Int'l Trade LEXIS 107 (Ct. Int'l Trade Sept. 23, 2015). Because the CIT did not err in upholding Commerce's decision, we affirm.

I. BACKGROUND

A. Basis for Investigations and Administrative Reviews

Pursuant to 19 U.S.C. § 1673, Commerce imposes an antidumping duty on foreign merchandise if: (1) it determines that the merchandise "is being, or is likely to be, sold in the United States at less than its fair value," and (2) the International Trade Commission ("ITC") determines that the sale of the merchandise at less than fair value materially injures, threatens, or impedes the establishment of an industry in the United States. If an interested party files a petition with Commerce on behalf of an industry alleging that foreign merchandise warrants the imposition of an antidumping duty under § 1673, Commerce initiates an antidumping duty investigation. 19 U.S.C. § 1673a. As part of this investigation, Commerce calculates a "normal value" for the subject merchandise—the price at which the "foreign like product" is sold in the exporting country or in a representative country if, inter alia , the exporting country has a market situation that does not permit a proper comparison—so that it can compare the export price of the foreign merchandise with the normal value. Id. § 1677b.

If Commerce and the ITC conclude that the imports or sales of the subject merchandise are governed by § 1673, Commerce issues an antidumping duty order. Id. § 1673d(c)(2). The amount of the antidumping duty is "the amount by which the normal value exceeds the export price (or the constructed export price) for the merchandise." Id. § 1673. If requested, Commerce conducts a yearly administrative review of the antidumping duty order and calculates a new antidumping duty rate. Id. § 1675(a)(1)-(2).

B. Commerce's Investigation into Diamond Sawblades

On May 3, 2005, Diamond Sawblades Manufacturers Coalition ("DSMC") filed a petition on behalf of the domestic industry and workers producing diamond sawblades regarding imports of diamond sawblades. Preliminary Determination of Sales at Less than Fair Value, Postponement of Final Determination, and Preliminary Partial Determination of Critical Circumstances: Diamond Sawblades and Parts Thereof from the People's Republic of China (Investigation Preliminary Determination ), 70 Fed. Reg. 77,121, 77,121 (Dep't of Commerce Dec. 29, 2005). In response to the petition, Commerce initiated an investigation on June 21, 2005. Id. In its final determination, Commerce found that diamond sawblades from the PRC were being, or were likely to be, sold in the United States at less than fair value. Final Determination of Sales at Less Than Fair Value and Final Partial Affirmative Determination of Critical Circumstances: Diamond Sawblades and Parts Thereof from the People's Republic of China (Investigation Final Determination ), 71 Fed. Reg. 29,303, 29,303 (Dep't of Commerce May 22, 2006). The ITC separately found that the importation of diamond sawblades from the PRC threatened a United States industry with material injury. See Diamond Sawblades and Parts Thereof from China , Inv. No. 731-TA-1092, USITC Pub. 4559, 2015 WL 10553370, at *3, 2015 ITC LEXIS 1140, at *3–4 (Sept. 1, 2015) (Review).

In the Investigation Final Determination , Commerce acknowledged that, in proceedings involving non-market-economy ("NME") countries, Commerce "begins with a rebuttable presumption that all companies within the country are subject to government control." 71 Fed. Reg. at 29,307. Based on this presumption, Commerce assigns all exporters of the subject merchandise in a NME country a single antidumping duty rate "unless an exporter can demonstrate that it is sufficiently independent so as to be entitled to a separate rate." Id.

Commerce initially concluded that ATM had demonstrated de jure and de facto absence of government control and, thus, qualified for a separate rate. Id. at 29,307. Commerce set the ATM duty rate at 2.50%. Id. at 29,309. DSMC appealed Commerce's rate determination to the CIT. The CIT remanded the separate rate determination to Commerce for clarification of the test applied by Commerce and for an explanation regarding Commerce's treatment of the evidence of record.

Advanced Tech. & Materials Co. v. United States , 885 F.Supp.2d 1343, 1348 (Ct. Int'l Trade 2012). On remand, Commerce again concluded that ATM was entitled to the separate rate of 2.50%. Id. at 1348–49. On appeal, the CIT once more remanded the separate rate determination to Commerce, concluding that Commerce "failed to consider important aspects of the problem and offered explanations that run counter to the evidence before it." Id. at 1349. In the second remand, Commerce concluded that ATM had failed to rebut the presumption of government control. Advanced Tech. & Materials Co. v. United States , 938 F.Supp.2d 1342, 1345 (Ct. Int'l Trade 2013).

Specifically, Commerce found that the State-Owned Assets Supervision and Administration Commissions of the State Council of the PRC ("SASAC"), a Chinese government agency, owned 100 percent of the China Iron & Steel Research Institute ("CISRI") during the investigation period, and CISRI held a majority share in AT&M (one of the five companies making up ATM). Id. CISRI placed four of its senior officials on AT&M's board, and the other five board members were all nominated by CISRI. Id. Because the AT&M board was active in selecting the company's management, Commerce concluded that AT&M did not choose its own management autonomously, rendering ATM part of the PRC-wide entity. Id. ATM's status as part of the PRC-wide entity meant that it did not qualify for a separate rate. Id. The CIT affirmed Commerce's conclusion, id. at 1345–53, and we affirmed the CIT's judgment without opinion pursuant to our Rule 36, Advanced Tech. & Materials Co. v. United States , 541 Fed.Appx. 1002 (Fed. Cir. 2013).

C. First Administrative Review Proceedings

During the first administrative review, Commerce again considered whether ATM should receive a separate rate. Before the final decisions of the CIT and this court affirming Commerce's finding that ATM failed to rebut the presumption of government control in the initial investigation, Commerce again found that ATM qualified for a separate rate. Diamond Sawblades and Parts Thereof from the People's Republic of China: Final Results of Antidumping Duty Administrative Review: 2009–2010 (Initial Final Results ), 78 Fed. Reg. 11,143, 11,145 (Dep't of Commerce Feb. 15, 2013). Commerce set the ATM duty rate at 0.15%. Id. at 11,145. After the CIT issued its decision confirming that ATM did not qualify for a separate rate in the initial investigation, Commerce asked for a voluntary remand in the first administrative review to reconsider its separate rate analysis in light of the CIT's decision. See Diamond Sawblades Mfrs. Coal. v. United States (Remand Redetermination ), Court No. 13-00078 (Dep't of Commerce Apr. 10, 2015), http://enforcement.trade.gov/remands/14-50.pdf.

On remand, Commerce concluded that ATM did not qualify for a separate rate because it failed to rebut the presumption of government control. Id. at 2–4. Commerce referenced its analysis from the initial investigation proceedings, which the CIT and this court affirmed, and concluded that, "based on the evidence on the record of this proceeding, there is no meaningful difference between the circumstances at issue in the less-than-fair-value investigation and this review...." Id. at 3.

Because ATM failed to qualify for a separate rate, ATM was subject to the PRC-wide entity rate. See id. The then-governing PRC-wide entity rate was 164.09%. Commerce concluded, however, that it was appropriate to update the PRC-wide entity rate in light of information it had...