Dong-A Steel Co. v. United States

• Decision Date: 03 October 2018
• Docket Number: Slip Op. 18-133,Consol. Court No. 16-00201
• Parties: DONG-A STEEL COMPANY, Plaintiff, Atlas Tube, Consolidated Plaintiff, and Independence Tube Corporation, Plaintiff-Intervenor, v. UNITED STATES, Defendant, and Searing Industries, Southland Tube Inc., Bull Moose Tube Company, and HiSteel Co., Ltd, Defendant-Intervenors.
• Court: U.S. Court of International Trade

337 F.Supp.3d 1356

DONG-A STEEL COMPANY, Plaintiff,

Atlas Tube, Consolidated Plaintiff,

and

Independence Tube Corporation, Plaintiff-Intervenor,

v.UNITED STATES, Defendant,andSearing Industries, Southland Tube Inc., Bull Moose Tube Company, and HiSteel Co., Ltd, Defendant-Intervenors.

Slip Op. 18-133

Consol. Court No. 16-00201

United States Court of International Trade.

Dated: October 3, 2018

Jarrod M. Goldfeder, Trade Pacific PLLC, of Washington, D.C., argued for Plaintiff Dong-A Steel Company. With him on the brief was Robert G. Gosselink. Jonathan M. Freed also appeared.

Christopher T. Cloutier, Schagrin Associates, of Washington, D.C., argued for Consolidated Plaintiff and Defendant-Intervenor Atlas Tube and Defendant-Intervenors Searing Industries and Bull Moose Tube Company. With him on the brief was Roger B. Schagrin. Elizabeth J. Drake, Washington, John W. Bohn, and Paul W. Jameson also appeared.

Timothy C. Brightbill and Cynthia C. Galvez, Wiley Rein LLP, of Washington, D.C., for Plaintiff-Intervenor and Defendant-Intervenor Independence Tube Corporation and Defendant-Intervenor Southland Tube Inc. With them on the brief was Alan H. Price. Adam M. Teslik, Christopher B. Weld, Derick G. Holt, Jeffrey O. Frank, Laura El-Sabaawi, Maureen E. Thorson, Robert E. DeFrancesco, III, Stephanie M. Bell, Tessa V. Capeloto, and Usha Neelakantan, Washington, also appeared.

Tara K. Hogan, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, D.C., argued for Defendant United States. With her on the brief were Chad A. Readler, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Claudia Burke, Assistant Director. Of counsel on the brief was Zachary Simmons, Attorney, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, D.C. Mercedes C. Morno, Of Counsel, Office of Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, D.C., also appeared.

Jeffrey M. Winton and Daniel E. Parga, Law Office of Jeffrey M. Winton PLLC, of Washington, D.C., argued for Defendant-Intervenor HiSteel Co., Ltd. Amrietha Nellan also appeared.

OPINION

Choe-Groves, Judge:

This case involves an antidumping duty investigation of heavy walled rectangular welded carbon steel pipes and tubes from the Republic of Korea ("Korea"). The court reviews a final antidumping duty determination issued by the U.S. Department of Commerce ("Commerce" or "Department") concluding that imports of heavy walled rectangular welded carbon steel pipes and tubes from Korea are being, or are likely to be, sold at less than fair value. See Heavy Walled Rectangular Welded Carbon Steel Pipes and Tubes From the Republic of Korea, 81 Fed. Reg. 47,347 (Dep't Commerce July 21, 2016) (final determination of sales at less than fair value) ("Final Determination"); see also Issues and Decision Memorandum for the Final Affirmative Determination in the Less-Than-Fair-Value Investigation of Heavy Walled Rectangular Welded Carbon Steel Pipes and Tubes from the Republic of Korea, A-580-880, (July 14, 2016), available at http://enforcement.trade.gov/frn/summary/korea-south/2016-17313-1.pdf (last visited Sept. 28, 2018) ("Final Decision Memorandum").

Dong-A Steel Company ("DOSCO"), Atlas Tube ("Atlas Tube"), and Independence Tube Corporation ("Independence Tube") filed Rule 56.2 motions for judgment on the agency record. See Pl.'s Rule 56.2 Mot. J. Agency R., Feb. 27, 2017, ECF No. 46; Mem. Supp. Rule 56.2 Mot. Pl., Dong-A Steel Company, J. Agency R., Feb. 27, 2017, ECF No. 48 ("DOSCO's Br."); Mot. Atlas Tube J. Agency R. USCIT Rule 56.2, Feb. 27, 2017, ECF No. 45; Public Mem. L. Supp. Atlas Tube's Mot. J. Agency R., Feb. 27, 2017, ECF No. 45 ("Atlas Tube's Br."); Pl.-Intervenor Independence Tube Corporation Rule 56.2 Mot. J. Agency R., Feb. 27, 2017, ECF No. 49; Mem. Pl.-Intervenor Independence Tube Corporation Supp. Mot. J. Agency R., Feb. 28, 2017, ECF No. 52 ("Independence Tube's Br."). The motions challenge the following six aspects of Commerce's final antidumping duty determination as unsupported by substantial evidence or not in accordance with the law:

1. the decision to use the earlier of either the invoice date or the shipment date as the "date of sale";

2. the decision to assign full costs to non-prime merchandise;

3. the decision to adjust DOSCO's reported hot-rolled coil costs for merchandise that was identical in all physical characteristics except for paint;

4. the decision to compare merchandise on a theoretical weight basis;

5. the decision to deny a constructed export price offset to DOSCO; and

6. the decision to use the zeroing methodology in Commerce's differential pricing analysis.

Defendant United States ("Government") and Defendant-Intervenor HiSteel Co., Ltd. ("HiSteel") oppose the Rule 56.2 motions and request that the court sustain Commerce's final determination in all respects. See Def.'s Resp. Pl.'s Rule 56.2 Mots. J. Agency R., June 22, 2017, ECF No. 58 ("Def.'s Resp."); Resp. HiSteel Co., Ltd. Pl.'s & Pl.-Intervenor's Rule 56.2 Mots. J. Agency R., July 6, 2017, ECF No. 59. The court held oral argument on January 18, 2018. See Oral Argument, Jan. 18, 2018, ECF No. 84. For the reasons set forth below, the court upholds Commerce's final determination in its entirety.

PROCEDURAL HISTORY

Atlas Tube, Bull Moose Tube Company, EXLTUBE, Hannibal Industries, Inc., Independence Tube, Maruichi American Corporation, Searing Industries, Southland Tube, and Vest, Inc. (collectively, "Petitioners") filed petitions seeking an antidumping duty order on heavy walled rectangular welded carbon steel pipes and tubes from Korea. See Heavy Walled Rectangular Welded Carbon Steel Pipes and Tubes from the Republic of Korea, Mexico, and the Republic of Turkey, 80 Fed. Reg. 49,202, 49,203 (Aug. 17, 2015) (initiation of less-than-fair-value investigations). Commerce initiated a less-than-fair-value investigation of the subject merchandise from Korea. See id. at 49,205. Commerce selected DOSCO and HiSteel as mandatory respondents because they were the two largest publicly-identifiable producers and exporters of heavy walled rectangular welded carbon steel pipes and tubes by volume. See Decision Memorandum for the Preliminary Determination in the Antidumping Duty Investigation of Heavy Walled Rectangular Welded Carbon Steel Pipes and Tubes from the Republic of Korea (Korea) at 2, A-580-880, (Feb. 22, 2016), available at http://enforcement.trade.gov/frn/summary/korea-south/2016-04520-1.pdf (last visited Sept. 28, 2018) ("Preliminary Decision Memorandum"); see also Respondent Selection for the Antidumping Duty Investigation of Heavy Walled Rectangular Welded Carbon Steel Pipes and Tubes from the Republic of Korea, PD 25, bar code 3302635-01 (Sept. 4, 2015).

DOSCO and HiSteel submitted timely responses to Commerce's initial questionnaire in October and November 2015. See HiSteel Response to Section A of Questionnaire, CD 13–17, bar code 3405116-01 (Oct. 13, 2015) ("HiSteel Sec. A Resp."); DOSCO Section A Response, CD 18–23, bar code 3405151-01 (Oct. 13, 2015) ("DOSCO Sec. A Resp."); Response of HiSteel Co., Ltd. to Sections B and C of the Department's September 11 Questionnaire, CD 27, bar code 3412811-02 (Nov. 2, 2015) ("HiSteel Sec. B–C Resp."); Response of HiSteel Co., Ltd. to Section D of the Department's September 11 Questionnaire, CD 32, bar code 3414319-02 (Nov. 5, 2015) ("HiSteel Sec. D Resp."); DOSCO Sections B, C, and D Responses, CD 34–39, bar code 3415176-01 (Nov. 5, 2015) ("DOSCO Sec. B–D Resp."). Commerce issued supplemental questionnaires to DOSCO and HiSteel, for which timely responses were submitted. See HiSteel Response to October 19 Supplemental Questionnaire, CD 46–52, bar code 3416611-01 (Nov. 12, 2015) ("HiSteel Suppl. Sec. A Resp."); DOSCO Supplemental Section A Response, CD 53, bar code 3418591-01 (Nov. 19, 2015); HiSteel Response to November 19 Supplemental Section D Questionnaire, CD 60–61, bar code 3427422-01 (Dec. 21, 2015) ("HiSteel Suppl. Sec. D Resp."); DOSCO Supplemental Section D Response, CD 71, bar code 3427490-01 (Dec. 18, 2015); DOSCO Supplemental Sections A–C Response, CD 75–78, bar code 3430118-01 (Jan. 5, 2016) ("DOSCO Suppl. Sec. A–C Resp.").

In its preliminary determination, Commerce assigned weighted-average dumping margins of 2.53 percent to DOSCO and 3.81 percent to HiSteel. See Heavy Walled Rectangular Welded Carbon Steel Pipes and Tubes From the Republic of Korea, 81 Fed. Reg. 10,585, 10,586 (Dep't Commerce Mar. 1 2016) (preliminary determination of sales at less than fair value and postponement of final determination); Preliminary Decision Memorandum at 2. After considering the parties' arguments in their administrative case and rebuttal briefs, Commerce issued its final determination on July 21, 2016. See Final Determination, 81 Fed. Reg. at 47,347. Commerce calculated margins of 2.34 percent for DOSCO and 3.82 percent for HiSteel. See id. at 47,348.

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), and 28 U.S.C. § 1581(c). The court "shall hold unlawful any determination, finding or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i).

ANALYSIS

I. Date of Sale

The first issue before the court is whether Commerce erred in deciding to use the earlier of either the invoice date or the shipment date as the "date of sale," rather than using the purchase order date. Atlas Tube and Independence Tube argue that Commerce erred by ignoring both precedent and record evidence and ask the court to find that Commerce's actions were neither supported by substantial evidence nor in accordance with the law. See Atlas Tube's Br. 10; Independence Tube's Br. 2, 7. The Government counters that Commerce's...