Dupont Teijin Films Usa, Lp v. U.S., SLIP OP. 03-167.

• Decision Date: 17 December 2003
• Docket Number: No. 02-00463.,SLIP OP. 03-167.,02-00463.
• Citation: 297 F.Supp.2d 1367
• Parties: DUPONT TEIJIN FILMS USA, LP, Mitsubishi Polyester Film of America, LLC, and Toray Plastics (America), Inc., Plaintiffs, v. UNITED STATES, Defendant, and Polyplex Corporation Limited, Defendant-Intervenor.
• Court: U.S. Court of International Trade

Page 1367

297 F.Supp.2d 1367

DUPONT TEIJIN FILMS USA, LP, Mitsubishi Polyester Film of America, LLC, and Toray Plastics (America), Inc., Plaintiffs, v. UNITED STATES, Defendant, and Polyplex Corporation Limited, Defendant-Intervenor.

SLIP OP. 03-167.

No. 02-00463.

United States Court of International Trade.

December 17, 2003.

Wilmer, Cutler & Pickering, Washington, DC (John D. Greenwald, Ronald I. Meltzer, and Lynn M. Fischer) for plaintiffs.

Peter D. Keisler, Assistant Attorney General, David M. Cohen, Director, Jeanne E. Davidson, Deputy Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Paul D. Kovac), Scott D. McBride, Office of the Chief Counsel for Import Administration, United States Department of Commerce, for defendant, of counsel.

Coudert Brothers LLP, Washington, DC (Kay C. Georgi and Mark P. Lunn) for defendant-intervenor.

OPINION

RESTANI, Chief Judge.

This matter is before the court following remand in Dupont Teijin Films USA, LP v. United States, 273 F.Supp.2d 1347 (CIT 2003) ("Dupont Teijin I"). In its Final Results of Redetermination Pursuant to Court Remand [hereinafter Remand Determination], the Department of Commerce ("Commerce" or "the Department") determined to include Defendant-Intervenor Polyplex Corporation Limited ("Polyplex") in the antidumping duty order on polyethylene terephthalate film, sheet, and strip ("PET film") from India because its weighted-average dumping margin was greater than de minimis. Polyplex and Dupont Teijin Films USA, LP, Mitsubishi Polyester Film of America, LLC, and Toray Plastics (America), Inc. ("Plaintiffs"), domestic producers of PET film and petitioners in the underlying investigation, now raise various challenges to the Remand Determination. Polyplex has also filed a motion to supplement the record and to amend its memorandum of law in this matter in light of Commerce's recent request for comments on Section 201 duties.

Jurisdiction & Standard of Review

The court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (2000). The court will uphold Commerce's determination in an antidumping duty investigation 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) (2000).

Factual & Procedural Background

In Dupont Teijin I, the court reviewed Commerce's final determination in the antidumping duty investigation, which found that PET film from India is being sold, or is likely to be sold, in the United States at less than fair value ("LTFV"). 273 F.Supp.2d at 1350; see Polyethylene Terephthalate Film, Sheet, and Strip From India, 67 Fed.Reg. 34,899 (Dep't Commerce May 16, 2002) [hereinafter Final Determination]. Commerce calculated Polyplex's weighted-average dumping margin at 10.34 percent, but the Department "adjusted the antidumping duty cash deposits for the export subsidies found in the companion countervailing investigation rather than adjusting net U.S. price." Final Determ., 67 Fed.Reg. at 34,900-01 & n. 2 (citation omitted). Based on its zero cash deposit rate, Commerce excluded Polyplex from its affirmative dumping determination on PET film from India and the resulting antidumping duty order. Id. at 34,901; Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order, 67 Fed.Reg. 44,175, 44,176 n. 2 (Dep't Commerce July 1, 2002) [hereinafter Amended Final Determination].

In reviewing this action, the court held that Commerce's Final Determination was not in accordance with law, because an exporter with a dumping margin greater than two percent must be included in an affirmative final determination of sales at LTFV regardless of its cash deposit rate. Dupont Teijin I, 273 F.Supp.2d at 1352. The court remanded the case to Commerce with instructions that its exclusion of Polyplex could only be based on a de minimis dumping margin as a result of adjustments to Polyplex's U.S. price pursuant to 19 U.S.C. § 1677a(c)(1)(C) (2000). See id. & n. 11. The court noted that the real issue here is whether Commerce could reasonably interpret the statute, which requires Commerce to increase Polyplex's export price by "the amount of any countervailing duty imposed on the subject merchandise ... to offset an export subsidy," to apply in situations like the present where countervailable export subsidies are found in a companion countervailing duty investigation, but where duties have not yet been assessed after an administrative review.¹ Id. n.11 (quoting 19 U.S.C. § 1677a(c)(1)(C) (emphasis added)). Because the Department failed to make any adjustments to Polyplex's U.S. price in the Final Determination, but rather based its exclusion of Polyplex on its zero cash deposit rate despite a dumping margin above de minimis levels, the court ordered Commerce to "calculate Polyplex's dumping margin after making the adjustments to export price required by 19 U.S.C. § 1677a and Commerce's reasonable interpretations thereof." Id. at 1352. The court instructed that, "[i]f Commerce continues to calculate a dumping margin of 10.34 percent for Polyplex, Polyplex must be subject to the antidumping duty order, whether or not it is given a cash deposit rate of zero because of expected offsetting countervailing duties." Id. at 1352-53.

In its Remand Determination, after providing notice and an opportunity for comment, Commerce set forth its interpretation of the disputed phrase "countervailing duty imposed" in the context of companion antidumping and countervailing duty investigations. Although the Department normally interprets the term "imposed" to require an adjustment to export price only following the actual assessment of countervailing duties following an administrative review, in parallel antidumping and countervailing duty investigations, "Commerce considers countervailing duties to be imposed upon the issuance of a countervailing duty order." Remand Determ. at 3-4. Such an order "directs customs officers to assess a countervailing duty." Id. at 7 (quoting 19 U.S.C. § 1671e(a)). Commerce explains that, if a countervailing duty order has not issued prior to its final determination in an antidumping duty investigation, Commerce will adjust the producer's cash deposits on future entries "to prevent assessment of both antidumping and countervailing duties to compensate for the same cause of unfairly priced imports." Id. at 8.

In applying its statutory interpretation to the facts of this case, Commerce explained that, because Polyplex's exports were not subject to a countervailing duty order at the time Commerce issued its Final Determination, countervailing duties had not been "imposed" on the subject merchandise, and, therefore, an increase in Polyplex's U.S. price was not permitted. Id. at 4. Accordingly, Commerce determined to include Polyplex in the antidumping duty order, but chose to account for the countervailable export subsidies in its cash deposit instructions to customs officials in order to prevent the double assessment of duties. See id. at 8. This action followed.

Discussion

The parties raise several challenges to the Department's Remand Determination. While Plaintiffs support Commerce's decision to include Polyplex in the antidumping duty order, they claim that the Department's new interpretation of § 1677a(c)(1)(C) is inconsistent with the plain language of the statute and the court's decision in Serampore Industries v. United States, 11 CIT 866, 871-73, 675 F.Supp. 1354, 1359-60 (1987), which upheld as "sufficiently reasonable" Commerce's interpretation of "imposed" to include countervailing duties only when they are "actually imposed" or "assessed."² Plaintiffs argue, however, that the court should affirm the Remand Determination without reviewing the Department's new statutory interpretation because, in Plaintiffs' view, Commerce did not apply it in calculating Polyplex's dumping margin. In response to Plaintiffs' claims, both Polyplex and Commerce argue that Commerce's interpretation of the statute is ripe for review and not precluded by Serampore.

Nevertheless, Polyplex claims that the Department's new interpretation of § 1677a(c)(1)(C) is not in accordance with the court's remand order³ and is unreasonable in light of the statute's underlying purpose.⁴ Polyplex offers what it argues is a better interpretation of the statute that is consistent with both the legislative purpose and the U.S.'s international obligations.⁵ In the alternative, Polyplex argues that, even if the court upholds the Department's interpretation of the statute an adjustment to its dumping margin was required here because the countervailing duty order was issued on the same day as the amended final dumping determination.⁶

In reviewing Plaintiffs' claims, the court finds that the Department's new interpretation is ripe for review because Commerce did in fact employ it in declining to make an adjustment to Polyplex's U.S. price and subjecting Polyplex to the antidumping duty order. Similarly, the court rejects Plaintiffs' argument that the agency is bound by the previous interpretation of "imposed" that was upheld in Serampore. "[I]t is well settled that an agency may change its interpretation of an underlying statutory provision even absent any alteration in that provision, so long as the reason for the change is explained and the change does not conflict with the underlying statute." Paralyzed Veterans of Am. v. Sec'y of Veterans Affairs, 345 F.3d 1334, 1353 (Fed.Cir.2003). In its Remand Determination, Commerce explained that, prior to this court's decision in Dupont Teijin I, its practice was to reduce the percentage antidumping margin by the export subsidy rate calculated in a concurrent countervailing duty investigation in its cash deposit instructions sent to Customs, rather than increasing U.S. price under § 1677a. Applying this methodology in its Final Determination, the Department excluded Polyplex from the...