Hitachi Metals, Ltd. v. United States

• Citation: 350 F.Supp.3d 1325
• Decision Date: 11 October 2018
• Docket Number: Consol. Court No. 17-00140,Slip Op. 18-137
• Parties: HITACHI METALS, LTD. and Hitachi Metals America LLC, Plaintiffs, and Daido Steel Co., Ltd., Consolidated Plaintiff, v. UNITED STATES, Defendant, and Nucor Corporation and ArcelorMittal USA LLC, Defendant-Intervenors.
• Court: U.S. Court of International Trade

350 F.Supp.3d 1325

HITACHI METALS, LTD. and Hitachi Metals America LLC, Plaintiffs,andDaido Steel Co., Ltd., Consolidated Plaintiff,

v. UNITED STATES, Defendant,andNucor Corporation and ArcelorMittal USA LLC, Defendant-Intervenors.

Slip Op. 18-137

Consol. Court No. 17-00140

United States Court of International Trade.

Dated: October 11, 2018

Daniel J. Cannistra and Robert L. LaFrankie, Crowell & Moring, LLP, of Washington, DC, argued for Plaintiffs Hitachi Metals, Ltd. and Hitachi Metals America LLC.

Mathew R. Nicely, Hughes Hubbard & Reed LLP, of Washington, DC, argued for Consolidated-Plaintiff Daido Steel Co., Ltd. With him on the brief was Daniel M. Witkowski.

Peter L. Sultan, Attorney, Office of the General Counsel, U.S. International Trade Commission, of Washington, DC, argued for Defendant United States. With him on the brief were Dominic L. Bianchi, General Counsel, and Andrea C. Casson, Assistant General Counsel for Litigation.

R. Alan Luberda, Kelley Drye & Warren LLP, of Washington, DC, argued for Defendant-Intervenor ArcelorMittal USA LLC. With him on the brief were Paul C. Rosenthal, Kathleen W. Cannon, and Brook M. Ringel.

Alan H. Price, Timothy C. Brightbill, and Christopher B. Weld, Wiley Rein LLP, of Washington, DC, for Defendant-Intervenor Nucor Corporation.

OPINION

Barnett, Judge:

This consolidated action is before the court on two motions for judgment on the agency record challenging the United States International Trade Commission's ("ITC" or "Commission") domestic like product determination in the investigation of carbon and alloy steel cut-to-length plate ("CTL plate") from Japan.¹ See Carbon and Alloy Steel Cut-to-Length Plate From Austria, Belgium, France, Germany, Italy, Japan, Korea, and Taiwan ("Final Japan Determination "), 82 Fed. Reg. 23,592 (ITC May 23, 2017) (final determinations), PR 529, PJA Tab 41, CJA Tab 41, ECF No. 61.

Specifically, Hitachi Metals, Ltd. and Hitachi Metals America, Inc. (together, "Hitachi") and Consolidated-Plaintiff Daido Steel Co., Ltd. ("Daido") (collectively, "Plaintiffs") challenge the ITC's inclusion of tool steel in the domestic like product as unsupported by substantial evidence and not in accordance with law. See Confidential Pls.' 56.2 Mot. for J. on the Agency R., ECF No. 45, and Confidential Mem. of Law in Supp. of Pls.' Confidential Rule 56.2 Mot. for J. Upon the Agency R. ("Hitachi Mem."), ECF No. 45-1; Confidential Consol. Pl.'s Rule 56.2 Mot. for J. on the Agency R., ECF No. 46, and Consol. Pl.'s Confidential Mem. in Supp. of Rule 56.2 Mot. for J. on the Agency R. ("Daido Mem."), ECF No. 46-1. Defendant United States ("Defendant" or the "Government") and Defendant-Intervenors ArcelorMittal USA LLC ("ArcelorMittal") and Nucor Corp. ("Nucor") (together, "Defendant-Intervenors") support the Commission's determination. See Confidential Def. United States Int'l Trade Comm'n's Mem. in Opp'n to Pls.' and Consol. Pl.'s Mots. for J. on the Agency R. ("Gov. Resp."), ECF No. 49; Confidential Def.-Ints.' Resp. in Opp'n to Pl. Hitachi's and Consol. Pl. Daido's Respective Mots. for J. on the Agency R. ("Def.-Int. Resp."), ECF No. 48. For the reasons discussed below, Plaintiffs' motions are denied.

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) (2012).² An ITC determination is "presumed to be correct," and the burden of proving otherwise rests upon the challenging party. 28 U.S.C. § 2639(a)(1). The court will uphold an ITC determination that is supported by substantial evidence and otherwise in accordance with law. 19 U.S.C. § 1516a(b)(1)(B)(i). "Substantial evidence is ‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’ " Huaiyin Foreign Trade Corp. (30) v. United States , 322 F.3d 1369, 1374 (Fed. Cir. 2003) (quoting Consol. Edison Co. v. NLRB , 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938) ). It "requires more than a mere scintilla," but "less than the weight of the evidence." Nucor Corp. v. United States , 34 CIT 70, 72, 675 F.Supp.2d 1340, 1345 (2010) (quoting Altx, Inc. v. United States , 370 F.3d 1108, 1116 (Fed. Cir. 2004) ).

BACKGROUND

I. Legal Framework

"Under the unfair trade laws, [the U.S. Department of Commerce ("Commerce") ] determines whether foreign imports into the United States are either being dumped or subsidized (or both)," and the Commission "determine[s] whether these dumped or subsidized imports are causing material injury to a domestic industry in the United States." Changzhou Trina Solar Energy Co., Ltd. v. U.S. Int'l Trade Comm'n , 39 CIT ––––, ––––, 100 F.Supp.3d 1314, 1319 (2015) (citation omitted); see also 19 U.S.C. §§ 1671, 1673. Accordingly, "Commerce determines the scope of [an] investigation," establishing the class or kind of foreign merchandise that would be subject to any resulting antidumping or countervailing duty order, Cleo Inc. v. United States , 30 CIT 1380, 1382 (2006), aff'd , 501 F.3d 1291 (Fed. Cir. 2007), while the Commission "identif[ies] the corresponding universe of items produced in the United States [by the affected industry] that are like, or in the absence of like, most similar in characteristics and uses with the items in the scope of the investigation," Changzhou Trina Solar , 100 F.Supp.3d at 1319 (citing 19 U.S.C. §§ 1673(i), 1671(a) ) (additional citation and quotation and formatting marks omitted); see also 19 U.S.C. § 1677(10) ("The term ‘domestic like product’ means a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation."). Although the scope of an investigation "is necessarily the starting point of the Commission's like product analysis," Cleo Inc. v. United States , 501 F.3d 1291, 1298 n.1 (Fed. Cir. 2007) (citing 19 U.S.C. § 1677(10) ), the scope "does not control the Commission's determination," id. ; see also Hosiden Corp. v. Advanced Display Mfrs. of Am. , 85 F.3d 1561, 1567 (Fed. Cir. 1996) (citation omitted).

The domestic like product determination is a fact-specific inquiry pursuant to which the Commission weighs "six factors relating to the products in question: (1) physical characteristics and uses; (2) common manufacturing facilities and production employees; (3) interchangeability; (4) customer perceptions; (5) channels of distribution; and, where appropriate, (6) price." Cleo , 501 F.3d at 1295. "When weighing those factors, the Commission disregards minor differences and focuses on whether there are any clear dividing lines between the products being examined." Id.

II. Factual and Procedural History

On April 8, 2016, domestic CTL³ plate producers ArcelorMittal, Nucor, and SSAB Enterprises, Inc. (collectively, the "Petitioners") filed an antidumping and countervailing duty petition with Commerce and the ITC regarding certain carbon and alloy steel CTL plate imported from several countries. Antidumping and Countervailing Duty Petition, Vol. 1, General and Injury Sections (Apr. 8, 2016) ("Petition"), PR 1, CR 1, PJA Tab 1, CJA Tab 1, ECF No. 61. Therein, the Petitioners framed the scope of the investigation as "certain carbon and alloy steel hot-rolled or forged flat plate products not in coils, whether or not painted, varnished, or coated with plastics or other non-metallic substances (cut-to-length plate)." Id. at 9. The Petitioners proposed various requirements regarding width and thickness, permissible amounts of iron and carbon content, and third country processing. Id. at 10. The Petitioners further proposed excluding seven categories of products from the scope, including stainless steel, and set forth additional exclusions on the basis of existing antidumping or countervailing duty orders involving the People's Republic of China and South Korea. Id. at 10-15. According to the Petitioners, by including "all alloy CTL plate other than stainless plate," the proposed scope was broader than in past investigations, but such broadening was necessary to "reflect[ ] changes in steelmaking and the types of CTL plate being produced by the domestic CTL plate industry." Id. at 16. The Petitioners urged the ITC to find a single domestic like product coextensive with the scope of the investigation. Id. at 22-24.

The Commission subsequently instituted an antidumping and countervailing duty injury investigation into certain carbon and alloy steel cut-to-length plate from Austria, Belgium, Brazil, China, France, Germany, Italy, Japan, Korea, South Africa, Taiwan, and Turkey. Notice of Institution of Antidumping and Countervailing Duty Investigations and Scheduling of Prelim. Phase Investigation (Apr. 8, 2016), PR 17, PJA Tab 2, CJA Tab 2, ECF No. 61. In May 2016, the Commission made a preliminarily affirmative injury finding regarding imports of certain carbon and alloy steel cut-to-length plate from several countries, including Japan, which were alleged to be sold in the United States at less than fair value. See Certain Carbon and Alloy Steel Cut-to-Length Plate from Austria, Belgium, Brazil, China, France, Germany, Italy, Japan, Korea, South Africa, Taiwan, and Turkey , Inv. Nos. 701-TA-559 -561 and 73-TA-1317-1328, USITC Pub. 4615 (May 2016) (Prelim.) at 1, PR 159, PJA Tab 5, CJA Tab 5, ECF No. 61. The Commission preliminarily found "a single domestic like product consisting of all CTL plate coextensive with the scope of these investigations" as announced by Commerce in its notices of initiation. Id. at 14. The scope included:

Certain carbon and alloy steel hot-rolled or forged flat plate products not in coils, whether or not painted, varnished, or coated with plastics or other non-metallic substances. Subject merchandise includes plate that is produced by being cut-to-length from coils and plate that is rolled or forged into a discrete length. The products covered include (1) Universal mill plates (i.e.,

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