Fabrique De Fer De Charleroi S.A. v. U.S., SLIP OP. 01-82.

• Citation: 155 F.Supp.2d 801
• Decision Date: 03 July 2001
• Docket Number: Court No. 98-02-00359.,SLIP OP. 01-82.
• Parties: FABRIQUE DE FER DE CHARLEROI S.A., Plaintiff, v. THE UNITED STATES, Defendant and Bethlehem Steel Corporation and U.S. Steel Group a Unit of USX Corporation, Defendant-Intervenors.
• Court: U.S. Court of International Trade

155 F.Supp.2d 801

FABRIQUE DE FER DE CHARLEROI S.A., Plaintiff, v. THE UNITED STATES, Defendant and Bethlehem Steel Corporation and U.S. Steel Group a Unit of USX Corporation, Defendant-Intervenors.

SLIP OP. 01-82.

Court No. 98-02-00359.

United States Court of International Trade.

July 3, 2001.

COPYRIGHT MATERIAL OMITTED

Barnes, Richardson & Colburn, Washington, DC (Gunter von Conrad, Michael J. Chessler and Alyssa Chumnanvech) for plaintiff.

Stuart E. Schiffer, Acting Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Velta A. Melnbrencis, Assistant Director); of counsel: Bernd G. Janzen, Office of the Chief Counsel for Import Administration, United States Department of Commerce, Washington, DC, for the United States.

Dewey Ballantine LLP, Washington, DC (Michael H. Stein, Bradford L. Ward and Frank J. Schweitzer) for defendant-intervenors.

OPINION

TSOUCALAS, Senior Judge.

Plaintiff, Fabrique de Fer de Charleroi S.A. ("FAFER"), moves pursuant to USCIT R. 56.2 for judgment upon the agency record challenging various aspects of the United States Department of Commerce International Trade Administration's ("Commerce") final determination, entitled Final Results of Antidumping Duty Administrative Review of Certain Cut-to-Length Carbon Steel Plate From Belgium ("Final Results"), 63 Fed.Reg. 2959 (Jan. 20, 1998). Specifically, FAFER disputes: (1) Commerce's use of FAFER's general commission as a proxy for FAFER's indirect selling expenses; and (2) Commerce's decision that FAFER's antidumping duties have been absorbed.

BACKGROUND

This case concerns the antidumping duty order on cut-to-length carbon steel plate imported to the United States from Belgium during the 1995-96 period of review ("POR"). See Antidumping Duty Order and Amendment to Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From Belgium ("Antidumping Duty Order"), 58 Fed.Reg. 44,164 (Aug. 19, 1993). Commerce published the preliminary results of the subject review on September 15, 1997. See Cut-to-Length Carbon Steel Plate From Belgium: Preliminary Results of Antidumping Duty Administrative Review, 62 Fed.Reg. 48,213. Commerce published the Final Results on January 20, 1998. See 63 Fed.Reg. 2959. FAFER initiated the case at bar against Commerce on February 18, 1998, and on April 30, 1998, this Court granted consent motion to Bethlehem Steel Corporation and U.S. Steel Group A Unit of USX Corporation ("Domestic Producers") to enter as defendant-intervenors.

JURISDICTION

The Court has jurisdiction over this matter pursuant to 19 U.S.C. § 1516a(a) (1994) and 28 U.S.C. § 1581(c) (1994).

STANDARD OF REVIEW

The Court will uphold Commerce's final determination in an antidumping administrative review 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) (1994); see NTN Bearing Corp. of Am. v. United States, 24 CIT ___, ___, 104 F.Supp.2d 110, 115-16 (2000) (detailing Court's standard of review in antidumping proceedings).

A. Commerce's Use of FAFER's General Commissions as a Proxy for FAFER's Indirect Selling Expenses

1. Background

On August 19, 1993, Commerce published the Antidumping Duty Order covering merchandise subject to the review. See 58 Fed.Reg. 44,164. On September 17, 1996, Commerce duly initiated the review at issue. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 61 Fed.Reg. 48,882. On September 19, 1996, Commerce issued to FAFER its standard questionnaire instructing FAFER, among other things, to report various expenses that FAFER incurred in its home market and the United States, inclusive of FAFER's indirect selling expenses related to the United States sales. See Def.'s Mem. Opp. Pl.'s Mot. J. Agency R. ("Def.'s Mem."), Ex. 1. Later on, Commerce issued a supplemental questionnaire seeking additional information and clarifications. See Def.'s Mem., Ex. 3.

Both questionnaires provided very specific instructions with regard to the format in which Commerce expected FAFER to submit the information sought. See id., Ex. 1, 3. Responding to the questionnaires, FAFER did not identify FAFER's indirect selling expenses related to the United States sales in the way and with the specificity that Commerce requested. See Pl.'s Br. Sup. Mot. Summ. J. ("Pl.'s Br.") at 10. FAFER, however, notified Commerce that the submitted data: (a) was derived from FAFER's internal "Cost of Production Analysis System" ("COPAS"); (b) did not "distinguish between direct and indirect labor costs" due to the structural deficiencies of COPAS, Pl.'s Reply Br. Supp. Mot. Summ. J. ("Pl.'s Reply") at 5 and 6, n. 7; and (c) provided the calculation of FAFER's general and administrative expenses ("G & A") that included employees wages and charges. See Pl.'s Br., App. 13.

Commerce was left unsatisfied with the information provided by FAFER. See Preliminary Results, 62 Fed.Reg. 48,213-14. During the review, Commerce determined that FAFER's United States sale was a constructed export price ("CEP") sale, that is, a sale of the subject merchandise to an unaffiliated purchaser through an intermediary, the price for which had to be adjusted under subsections (c) and (d) of 19 U.S.C. § 1677a (1994) to account for FAFER's various direct and indirect selling expenses. See Preliminary Results, 62 Fed.Reg. at 48,214; 19 U.S.C. § 1677a(b)-(d) (1994). Missing the information on FAFER's indirect selling expenses, Commerce resorted to the facts available in reaching the applicable determination. See Def.'s Mem. 33-38. Specifically, Commerce used FAFER's general policy commission rate as a proxy for FAFER's indirect selling expenses even though Commerce established that "FAFER paid no commission upon its sole [United States] sale to its subsidiary, Charleroi USA" ("Charleroi"). Id. at 37.

2. Exhaustion of Administrative Remedies

a. Contentions of the Parties

As a preliminary matter, Commerce contends that the issues of whether Commerce properly: (a) "double-counted [indirect selling] expenses"; and (b) refused to entertain the shortcomings of FAFER's accounting system, should not be examined by this Court because FAFER failed to question these issues before Commerce and, consequently, forfeited its right to judicial review. Def.'s Mem. at 28.

FAFER alleges that the issues were sufficiently presented for Commerce's consideration when FAFER: (1) stated the deficiencies of COPAS; and (2) pointed out that G & A calculation was made on the basis of employees wages and charges that have already been taken into account. See Pl.'s Reply at 6.

b. Analysis

The exhaustion doctrine requires a party to present its claims to the relevant administrative agency for the agency's consideration before raising these claims to the Court. See Unemployment Compensation Comm'n of Alaska v. Aragon, 329 U.S. 143, 155, 67 S.Ct. 245, 91 L.Ed. 136 (1946) ("A reviewing court usurps the agency's function when it sets aside the administrative determination upon a ground not theretofore presented and deprives the [agency] of an opportunity to consider the matter, make its ruling, and state the reasons for its action").¹

The purpose behind the doctrine of exhaustion is to prevent courts from premature involvement in administrative proceedings, and to protect agencies "from judicial interference until an administrative decision has been formalized and its effects felt in a concrete way by the challenging parties." Abbott Lab. v. Gardner, 387 U.S. 136, 148-49, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967); see also Public Citizen Health Research Group v. Commissioner, FDA, 740 F.2d 21, 29 (D.C.Cir. 1984) (pointing out that the exhaustion doctrine serves "four primary purposes: [(1)] it ensures that persons do not flout established administrative processes"; (2) "it protects the autonomy of agency decisionmaking"; (3) it aids judicial review by permitting factual development of issues relevant to the dispute; and (4) "it serves judicial economy by avoiding repetitious administrative and judicial factfinding" and by resolving sole claims without judicial intervention.)

While a plaintiff cannot circumvent the requirements of the doctrine of exhaustion by merely mentioning a broad issue without raising a particular argument, plaintiff's brief statement of the argument is sufficient if it alerts the agency to the argument with reasonable clarity and avails the agency with an opportunity to address it. See generally, Hormel v. Helvering, 312 U.S. 552, 61 S.Ct. 719, 85 L.Ed. 1037 (1941); see also Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed.Cir.1990). The sole fact of agency's failure to address plaintiff's challenge does not invoke the exhaustion doctrine and shall not result in forfeiture of plaintiff's judicial remedies. See generally, B-West Imports, Inc. v. United States, 19 CIT 303, 880 F.Supp. 853 (1995). An administrative decision not to address the issue cannot be dispositive of the question whether or not the issue was properly brought to the agency's attention. See, e.g., Allnutt v. United States DOJ, 2000 U.S. Dist. LEXIS 4060 (D.Md.2000).

In the case at bar, Commerce advised FAFER that common examples of indirect selling expenses are "inventory carrying costs, salesmen's salaries, ... product liability insurance [,] ... technical services [and] warranty repairs." See Def.'s Mem. at 27 (emphasis supplied). FAFER stated that its G & A costs included "employees wages [that have already been taken into account,] ... [i]nsurance costs [and] ... research costs." Pl.'s Br.App. 13 (emphasis supplied). FAFER also notified Commerce that its accounting system did not "distinguish between direct and indirect" expenses. Pl.'s Reply at 6, n. 7, accord Def.'s Mem. Ex. 5. While Commerce chose to read these two statements as asserting neither that FAFER's "G & A...