Dillinger Fr. S.A. v. United States

• Decision Date: 31 October 2018
• Docket Number: Court No. 17-00159,Slip Op. 18-150
• Citation: 350 F.Supp.3d 1349
• Parties: DILLINGER FRANCE S.A., Plaintiff, v. UNITED STATES, Defendant, and Nucor Corporation and SSAB Enterprises LLC, Defendant-Intervenor.
• Court: U.S. Court of International Trade

350 F.Supp.3d 1349

DILLINGER FRANCE S.A., Plaintiff,

v. UNITED STATES, Defendant,andNucor Corporation and SSAB Enterprises LLC, Defendant-Intervenor.

Slip Op. 18-150

Court No. 17-00159

United States Court of International Trade.

Dated: October 31, 2018

Marc E. Montalbine, deKieffer & Horgan PLCC, of Washington, DC, argued for plaintiff. With him on the brief were Gregory S. Menegaz and Alexandra H. Salzman.

Vito S. Solitro, Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With him on the brief were Chad A. Readler, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Tara K. Hogan, Assistant Director. Of counsel on the brief was Jessica DiPietro, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Stephanie M. Bell, Wiley Rein, LLP, of Washington, DC, argued for defendant-intervenor, Nucor Corporation. With her on the brief were Alan H. Price and Christopher B. Weld.

Roger B. Schagrin, Schagrin Associates, of Washington DC, for defendant-intervenor, SSAB Enterprises LLC.

OPINION

Gary S. Katzmann, Judge

Katzmann, Judge: At the center of this case is the challenge to the Department of Commerce's ("Commerce") final affirmative determination of sales at less-than-fair value in its anti-dumping investigation of certain carbon and alloy steel cut-to-length ("CTL") plate from France. Certain Carbon and Alloy Steel Cut-To-Length Plate from Austria, Belgium, France, the Federal Republic of Germany, Italy, Japan, the Republic of Korea, and Taiwan: Amended Final Affirmative Antidumping Determinations for France, the Federal Republic of Germany, the Republic of Korea and Taiwan, and Antidumping Duty Orders ("Final Determination"), 82 Fed. Reg. 24,096 (May 25, 2017), P.R. 456 and accompanying Issues and Decision Memorandum ("IDM") (Mar. 29, 2017), P.R. 445. Plaintiff Dillinger France S.A. ("Dillinger") contests multiple aspects of Commerce's decision -- including the level of trade analysis, the application of partial adverse facts available, the use of the differential pricing methodology, and cost-shifting between products -- and asks the court to remand the Final Determination. Pl.'s Br., Dec. 18, 2017, ECF Nos. 26–28. Defendant the United States ("the Government") and Defendant-Intervenor Nucor Corporation ("Nucor") ask the court to sustain Commerce's decision in its entirety. Def.'s Br., Feb. 16, 2018, ECF No. 32; Def.-Inter.'s Br., Feb. 20, 2018, ECF Nos. 38–39. The court sustains the Final Determination in part and remands Commerce's application of partial adverse facts available for reconsideration.

BACKGROUND

I. Legal Background.

Pursuant to United States antidumping law, Commerce must impose antidumping duties on subject merchandise that "is being, or is likely to be, sold in the United States at less than fair value" and that causes material injury or threat of material injury to a domestic industry. 19 U.S.C. § 1673 (2012).¹ "Sales at less than fair value are those sales for which the ‘normal value’ (the price a producer charges in its home market) exceeds the ‘export price’ (the price of the product in the United States)." Apex Frozen Foods Private Ltd. v. United States, 862 F.3d 1322, 1326 (Fed. Cir. 2017) (quoting Union Steel v. United States, 713 F.3d 1101, 1103 (Fed. Cir. 2013) ). Normal value is defined as "the price at which the foreign like product is first sold ... in the exporting country [i.e., the home market]." 19 U.S.C. § 1677b(a)(l)(B)(i). 19 U.S.C. § 1677b(a)(1)(B)(i) dictates that Commerce make a fair comparison between the export price and normal value, and specifically, that the comparison between export price and normal value be made at the same level of trade. See also Hyundai Steel Company v. United States, 41 CIT ––––, ––––, 279 F.Supp.3d 1349, 1356 (2017) ; Pasta Zara SpA v. United States, 34 CIT 355, 369, 703 F.Supp.2d 1317, 1329 (2010).

Section 1677f-1(d)(1) and 19 C.F.R. § 351.414(b) describe three methods by which Commerce may compare the normal value to the export price: (1) average-to-average ("A-to-A"), a comparison of weighted-average normal values to weighted-average export prices for comparable merchandise; (2) transaction-to-transaction ("T-to-T"), a comparison of normal values based on individual transactions to the export prices of individual transactions for comparable merchandise; and (3) average to transaction ("A-to-T"), a comparison of weighted-average normal values to the export prices of individual transactions for comparable merchandise. Commerce "will use the average-to-average method unless [Commerce] determines another method is appropriate in a particular case." 19 C.F.R. § 351.414(c)(1) ; see Stanley Works (Langfang) Fastening Systems Co., Ltd. v. United States, 41 CIT ––––, ––––, 279 F.Supp.3d 1172, 1177–78 (2017). Commerce may use the A-to-T method if "(i) there is a pattern of export prices ... for comparable merchandise that differ significantly among purchasers, regions, or periods of time, and (ii) [Commerce] explains why such differences cannot be taken into account using a method described in paragraph (1)(A)(i) [A-to-A] or (ii) [T-to-T]." 19 U.S.C. § 1677f-1(d)(1)(B) ; see Stanley Works, 279 F.Supp.3d at 1176–77.

When either necessary information is not available on the record or a respondent (1) withholds information that has been requested by Commerce, (2) fails to provide such information by Commerce's deadlines for submission of the information or in the form and manner requested, (3) significantly impedes an antidumping proceeding, or (4) provides information that cannot be verified, then Commerce shall "use the facts otherwise available in reaching the applicable determination." 19 U.S.C. § 1677e(a). This subsection thus provides Commerce with a methodology to fill informational gaps when necessary or requested information is missing from the administrative record. See Nippon Steel Corp. v. United States, 337 F.3d 1373, 1381 (Fed. Cir. 2003) ; Hyundai Steel, 279 F.Supp.3d at 1355. Commerce "may use an inference that is adverse to the interests of that party in selecting from among the facts otherwise available" if it "finds that an interested party has failed to cooperate by not acting to the best of its ability to comply with a request for information[.]" 19 U.S.C. § 1677e(b)(1)(A). A respondent's failure to cooperate to "the best of its ability" is "determined by assessing whether [it] has put forth its maximum effort to provide Commerce with full and complete answers to all inquiries." Nippon Steel, 337 F.3d at 1382.

II. Factual and Procedural Background.

Commerce initiated a less than fair value investigation regarding certain carbon and alloy steel CTL plate from countries including France. Certain Carbon and Alloy Steel Cut-To-Length Plate From Austria, Belgium, Brazil, France, the Federal Republic of Germany, Italy, Japan, the Republic of Korea, the People's Republic of China, South Africa, Taiwan, and the Republic of Turkey: Initiation of Less-Than- Fair-Value Investigations, 81 Fed. Reg. 27,089 (Dep't Commerce May 5, 2016), P.R. 43. Dillinger was chosen as one of the mandatory respondents² from France. Certain Carbon and Alloy Steel Cut-To- Length Plate From France: Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination, 81 Fed. Reg. 79,437 (Dep't Commerce Nov. 14, 2016), P.R. 372, and accompanying Preliminary Decision Memorandum ("PDM") at 2, P.R. 364. In its initial questionnaire, Commerce requested affiliate sales information, including, if the sales were not at arm's length, the affiliate's sales to unaffiliated customers. Initial Antidumping Duty Questionnaire at B-5 and 6 (May 31, 2016), P.R. 84. In its Section A questionnaire response, Dillinger reported three channels of distribution for its home market sales: (1) direct sales from its factory, (2) sales through affiliated service centers, and (3) sales of non-prime merchandise. Letter from deKieffer & Horgan, PLLC to Sec'y Commerce, re: Certain Carbon and Alloy Steel Cut-To-Length Plate from France; Dillinger France S.A. Section A Resp. (June 29, 2016) at A-12 & 13, C.R. 70–83, P.R. 154–52. As part of its response to supplemental questionnaires issued by Commerce, Dillinger also submitted a "selling activities chart," in which it identified the selling activities undertaken for each channel of distribution and the degree of involvement in each activity. Letter from deKieffer & Horgan, PLLC to Sec'y Commerce, re: Certain Carbon and Alloy Steel Cut-To-Length Plate from France; Dillinger France S.A. and Berg Steel Pipe Corp; Second Suppl. Sections A, B & C Resp. (Oct. 21, 2016) at 2–7, C.R. 362–63, P.R. 343.

Dillinger initially informed Commerce that it had difficulties collecting and reporting certain information on downstream³ sales made by Dillinger's home market service center Eurodécoupe, SAS ("Eurodécoupe"). Letter from deKieffer & Horgan, PLLC to Sec'y Commerce (June 8, 2016) at 1–3, C.R. 35, P.R. 102 ("June 8 Letter"). However, upon further request by Commerce, Dillinger was able to identify all of Eurodécoupe's home market sales by searching Eurodécoupe's sales and inventory records, including sales prices for all transactions, but was unable to identify the manufacturer of plate sold in every transaction. Third Suppl. Sections B & C Resp. (Nov. 2, 2016) at 2–5, C.R. 374, P.R. 358.

Commerce published its preliminary determination on November 14, 2016, and amended this determination on December 2, 2016 in light of ministerial errors. PDM; Certain Carbon and Alloy Steel Cut-to-Length Plate From France: Amended Preliminary Determination of Sales at Less Than Fair Value, 81 Fed. Reg. 87,019 (Dec. 2, 2016), P.R. 390. In its preliminary determination, Commerce found that there was one level of trade for Dillinger's home market sales. PDM at 12. Commerce also applied facts available...