Goodluck India Ltd. v. United States

• Citation: 393 F.Supp.3d 1352
• Decision Date: 13 August 2019
• Docket Number: Slip Op. 19-110,Court No. 18-00162
• Parties: GOODLUCK INDIA LIMITED, Plaintiff, v. UNITED STATES, Defendant, and ArcelorMittal Tubular Products, Michigan Seamless Tube, LLC, Plymouth Tube Co. USA, PTC Alliance Corp., Webco Industries, Inc. and Zekelman Industries, Inc, Defendant-Intervenors.
• Court: U.S. Court of International Trade

393 F.Supp.3d 1352

GOODLUCK INDIA LIMITED, Plaintiff,

v.UNITED STATES, Defendant,andArcelorMittal Tubular Products, Michigan Seamless Tube, LLC, Plymouth Tube Co. USA, PTC Alliance Corp., Webco Industries, Inc. and Zekelman Industries, Inc, Defendant-Intervenors.

Slip Op. 19-110

Court No. 18-00162

United States Court of International Trade.

Dated: August 13, 2019

Ned H. Marshak and Michael S. Holton, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt, LLP, of New York, NY and Washington, DC, argued for plaintiff. With them on the brief were Andrew T. Schutz, Kavita Mohan, and Jordan C. Kahn.

Ann C. Motto, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With her on the brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and Claudia Burke, Assistant Director. Of counsel was Caroline D. Bisk, Office of the Chief Counsel for Trade Enforcement & Compliance, Office of the General Counsel, U.S. Department of Commerce, of Washington, DC. Melissa M. Brewer and Kathleen M. Cusack, Kelley Drye & Warren, LLP, of Washington, DC, argued for defendant-intervenors. With them on the brief were R. Alan Luberda and David C. Smith.

OPINION

Katzmann, Judge:

This case turns on distinguishing correctible importer mistakes from submissions of untimely new factual information. Before the court is whether the Department of Commerce ("Commerce") abused its discretion by rejecting as untimely plaintiff Goodluck India Limited's ("Goodluck") corrections to information submitted as part of a less than fair value investigation on carbon and alloy steel from India and by subsequently relying on other sources of information to complete the factual record.

As part of the investigation, Goodluck submitted sales data on cold-drawn mechanical tubing sold in both its home market of India and in the United States and applied particular product characteristic codes to the underlying data. After Goodluck had begun preparing its data, Commerce revised its product characteristic coding guidance and extended Goodluck's submission deadline. When Goodluck submitted its responses to Commerce, it had failed to revise the coding for 682 home market sales, resulting in cascading errors in Goodluck's home sales and cost databases. Goodluck alerted Commerce to its errors -- which it characterized as correctible minor errors -- on the first day of verification, but Commerce rejected Goodluck's updated submissions as untimely new factual information. Consequently, Commerce rejected all of Goodluck's submitted data and issued Goodluck a final dumping margin of 33.80 percent based on total adverse facts available. Commerce also used another respondent's export subsidy rate to calculate Goodluck's export subsidy cash deposit offset, rather than the rate specifically calculated for Goodluck in the companion countervailing duty investigation. Goodluck appeals Commerce's determination on each issue to this court.

The court concludes that Commerce's decision to reject Goodluck's corrections was an abuse of discretion and remands to Commerce to consider Goodluck's corrected submission as well as to explain why it has departed from its general practice for calculating cash deposit offset rates in this case.

BACKGROUND

I. Legal Background

Dumping occurs when a foreign company sells a product in the United States for less than fair value. Sioux Honey Ass'n v. Hartford Fire Ins. Co., 672 F.3d 1041, 1046 (Fed. Cir. 2012). Similarly, a foreign country may artificially lower a product's price through subsidies. U.S. Steel Grp. v. United States, 96 F.3d 1352, 1355 n.1 (Fed. Cir. 1996). To ameliorate distortions caused by these economic practices, Congress enacted the Tariff Act of 1930 ("Act"), which empowers Commerce to investigate potential dumping or subsidies, and if appropriate, issue orders imposing duties on the subject merchandise. Sioux Honey Ass'n, 672 F.3d at 1046–47. These antidumping and countervailing duty actions are intended to be remedial, not punitive in nature, Chaparral Steel Co. v. United States, 901 F.2d 1097, 1103 (Fed. Cir. 1990), and it is Commerce's duty to determine margins as accurately as possible, Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed. Cir. 1990).

A. Minor Corrections

"Although Commerce has authority to place documents in the administrative record that it deems relevant, the burden of creating an adequate record lies with interested parties and not with Commerce." Nan Ya Plastics Corp. v. United States, 810 F.3d 1333, 1337 (Fed. Cir. 2016) (quoting QVD Food Co. v. United States, 658 F.3d 1318, 1324 (Fed. Cir. 2011) ). Commerce's regulations address submissions of new factual information¹ by parties to an investigation, with the type of factual information determining the time limit for submission to Commerce under 19 C.F.R. § 351.301(c). Pertinent here, 19 C.F.R. § 351.301(c)(5) requires that miscellaneous new factual information must be submitted either 30 days before the scheduled date of the preliminary results, or 14 days before verification, whichever is earlier.²

Apart from new factual information, "Commerce is free to correct any type of importer error—clerical, methodology, substantive, or one in judgment—in the context of making an antidumping duty determination, provided that the importer seeks correction before Commerce issues its final results and adequately proves the need for the requested corrections." Timken U.S. Corp. v. United States, 434 F.3d 1345, 1353 (2006). 19 C.F.R. § 351.224(f) provides a definition of "ministerial error."³ Additionally, this court has held that Commerce abuses its discretion by rejecting "corrective information," which includes submissions "to correct information already provided [to Commerce]," Fischer S.A. Comercio v. United States, 34 C.I.T. 334, 348, 700 F. Supp. 2d 1364, 1376 (2010), or to "clarif[y] information already in the record," id. at 1373, but not to "fill [ ] gap[s] caused by [a respondent's] failure to provide a questionnaire response or evidence requested during verification," id. at 1377. Notably, no regulation addresses the circumstances under which corrections will be accepted or a time frame within which corrections should be submitted. Deacero S.A.P.I de C.V. v. United States, 42 CIT ––––, ––––, 353 F. Supp. 3d 1303, 1307 (2018) ; see also Timken, 434 F.3d at 1353 (noting that it "appears that Commerce has not issued any regulation addressing whether an importer can correct errors in the information it has submitted, [nor] restricted the types of importer errors that are eligible for such correction.").

While Commerce is afforded discretion in deciding whether to accept a respondent's corrective information, Deacero, 353 F. Supp. 3d at 1309, if "Commerce acted differently in this case than it has consistently acted in similar circumstances without reasonable explanation, then Commerce's actions will have been arbitrary," Consolidated Bearings Co. v. United States, 348 F.3d 997, 1007 (Fed. Cir. 2003) (citing RHP Bearings v. United States, 288 F.3d 1334, 1347 (Fed. Cir. 2002) ). Moreover, "Commerce abuse[s] its discretion [when it] refus[es] to accept updated data when there [i]s plenty of time for Commerce to verify or consider it." Papierfabrik August Koehler SE v. United States, 843 F.3d 1373, 1384 (Fed. Cir. 2016) (citing NTN Bearing Corp. v. United States, 74 F.3d 1204, 1208–09 (Fed. Cir. 1995) (requiring correction of typing errors) and Timken, 434 F.3d at 1353 (expanding the holding in NTN to "any type of importer error—clerical, methodology, substantive, or one in judgment—... provided that the importer seeks correction before Commerce issues its final results and adequately proves the need for the requested corrections")). While "a tension may arise between finality and correct result" at later stages of an investigation, "[p]reliminary determinations are ‘preliminary’ precisely because they are subject to change ... the tension between finality and correctness [does] not exist at th[at] time." NTN, 74 F.3d at 1208.

B. Reliance on facts otherwise available and adverse facts available

If a party fails to satisfactorily respond to Commerce's requests for "necessary information" to calculate a dumping margin by withholding requested information, failing to provide information by the submission deadlines or in the form or manner requested, significantly impeding a proceeding, or providing information that cannot be verified, Commerce shall use facts otherwise available to calculate the margin. 19 U.S.C. § 1677e(a)(2). "The use of facts otherwise available ... is only appropriate to fill gaps when Commerce must rely on other sources of information to complete the factual record." Zhejiang DunAn Hetian Metal Co. v. United States, 652 F.3d 1333, 1346 (Fed. Cir. 2011) (citing Nippon Steel Corp. v. United States, 337 F.3d 1373, 1381 (Fed. Cir. 2003) ).

Under 19 U.S.C. § 1677e(b)(1)(A), Commerce may apply adverse inferences as facts available ("AFA") when Commerce "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[.]" A respondent does not cooperate to the "best of its ability" when it fails to "put forth its maximum effort to provide Commerce with full and complete answers to all inquiries." Dillinger France S.A. v. United States, 42 CIT ––––, ––––, 350 F. Supp. 3d 1349, 1360 (2018) (quoting Nippon Steel, 337 F.3d at 1382 ). "[W]here there is useable information of record but the record is incomplete," Commerce applies partial AFA.

Wash. Int'l Ins. Co. v. United States, 33 C.I.T. 1023, 1035 n.18, 2009 WL 2460824 (2009) (citing Yantai Timken Co., Ltd. v. United States, 31 C.I.T. 1741, 1746–48, 521 F. Supp. 2d 1356, 1364–65 (2007), aff'd 300 Fed. Appx. 934 (Fed. Cir. 2008) ). In contrast, when "none of the reported data is reliable or usable," Mukand, Ltd. v. United...