Hyundai Steel Co. v. United States
| Decision Date | 27 April 2021 |
| Docket Number | Slip Op. 21–47,Consol. Court No. 19-00099 |
| Citation | 518 F.Supp.3d 1309 |
| Court | U.S. Court of International Trade |
| Parties | HYUNDAI STEEL CO., Plaintiff, and United States Steel Corp., Consolidated Plaintiff, and Nucor Corp., Consolidated Plaintiff-Intervenor, v. UNITED STATES, Defendant, and United States Steel Corp., Defendant-Intervenor, and Hyundai Steel Co., Consolidated Defendant-Intervenor. |
J. David Park, Arnold & Porter Kaye Scholer LLP, of Washington DC, argued for Plaintiff and Consolidated Defendant-Intervenor Hyundai Steel Co. With him on the brief were Henry D. Almond and Daniel R. Wilson.
Elizabeth Speck, Senior Trial Counsel, 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 on the brief was Brendan Saslow, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.
Thomas M. Beline and Sarah E. Shulman, Cassidy Levy Kent (USA) LLP, of Washington DC, argued for Consolidated Plaintiff and Defendant-Intervenor United States Steel Corporation. With them on the brief was Jack A. Levy.
Before the court, in this consolidated action,1 are the motions for judgment on the agency record of Plaintiff and Consolidated Defendant-Intervenor Hyundai Steel Company ("Hyundai"), and Consolidated Plaintiff and Defendant-Intervenor United States Steel Corporation ("U.S. Steel"). By their respective motions, Hyundai and U.S. Steel challenge aspects of the final results of the United States Department of Commerce's ("Commerce" or the "Department") first administrative review of the antidumping duty order ("Order")2 on cold-rolled steel flat products from the Republic of Korea ("Korea"). See Certain Cold Rolled Steel Flat Products From the Republic of Korea , 84 Fed. Reg. 24,083 (Dep't Commerce May 24, 2019) ("Final Results") and accompanying Issues and Decision Mem. (May 17, 2019), P.R. 202 ("Final IDM"). Jurisdiction is found under 28 U.S.C. § 1581(c) (2018) and 19 U.S.C. § 1516a(a)(2)(B)(iii) (2018).
Hyundai, a Korean producer and exporter of subject merchandise, and a mandatory respondent in the review, contends that Commerce's use of adverse facts available in the Final Results cannot be sustained. See Hyundai's Mem. Supp. Mot. J. Agency R., ECF No. 31-2 ("Hyundai's Br."); Hyundai's Reply Br., ECF No. 42; see also 19 U.S.C. § 1677e(a) - (b). Hyundai maintains that, contrary to Commerce's findings, it fully and accurately complied with Commerce's requests for information and, to the extent Commerce found a deficiency in the company's reporting (i.e. , inconsistencies in reported specification information for U.S. and home market sales), the agency failed to provide Hyundai with notice of the nature of the deficiency and an opportunity to remedy it, prior to resorting to facts otherwise available, as required by the statute.3 See Hyundai's Br. 16; see also 19 U.S.C. § 1677m(d). Hyundai further maintains that, even if the use of adverse facts available were justified, Commerce's use was overbroad and arbitrary because the agency disregarded sales for which it found no inconsistencies in reported specification information. See Hyundai's Br. 1-2. Hyundai thus asks the court to "remand the agency's determination with instructions to Commerce to correct its errors." Hyundai's Br. 31.
For its part, U.S. Steel, a domestic steel producer, and one of the petitioners below,4 challenges Commerce's denial of its request to rescind the review with respect to Hyundai's affiliated freight company, Company A,5 and the assignment of the all-others rate to Company A, as contrary to law, because Company A is neither a producer nor an exporter of subject merchandise. See U.S. Steel's Mem. Supp. Mot. J. Agency R., ECF No. 29 ("U.S. Steel's Br."); U.S. Steel's Reply Br., ECF No. 40. In the alternative, U.S. Steel argues that, notwithstanding Company A being neither a producer nor exporter of subject merchandise, Company A should have been collapsed with Hyundai, and assigned Hyundai's adverse facts available rate. Thus, U.S. Steel asks the court to "remand for Commerce to come into compliance with the antidumping statute." U.S. Steel's Br. 21.
Defendant the United States ("Defendant"), on behalf of Commerce, maintains that the Final Results are supported by substantial evidence and otherwise in accordance with law. See Def.’s Resp. Opp'n, ECF No. 36 ("Def.’s Br."). U.S. Steel, as Defendant-Intervenor, urges the court to sustain the Final Results with respect to the issues raised in Hyundai's motion. See Def.-Int. U.S. Steel's Resp., ECF No. 35. Hyundai, as Consolidated Defendant-Intervenor, urges the court to sustain the Final Results with respect to the issues raised in U.S. Steel's motion. See Consol. Def.-Int. Hyundai's Resp., ECF No. 38.
The court finds that Department's use of facts available, under 19 U.S.C. § 1677e(a)6 based on Hyundai's alleged "withholding" of requested information, cannot be sustained because Commerce failed to comply with its obligation, under 19 U.S.C. § 1677m(d),7 to notify Hyundai of the nature of the alleged deficiency(ies) in Hyundai's questionnaire responses and provide the company an opportunity to remediate. Thus, on remand, Commerce shall reconsider whether the use of facts otherwise available is warranted with respect to any of Hyundai's sales, and adequately explain and support its remand redetermination with substantial evidence. If Commerce determines that the use of facts otherwise available is warranted, and it makes the additional, distinct finding that Hyundai failed to cooperate to the best of its ability, it must adequately explain and support this finding with substantial evidence.
Because the Department found that Company A was neither a producer nor an exporter of subject merchandise during the period of review, and thus did not meet the requirements of 19 U.S.C. §§ 1673b(d) and 1673d(c)(1) for the determination of an antidumping duty rate, the court remands for Commerce to rescind the assignment of the all-others rate to Company A.
The court sustains Commerce's finding that U.S. Steel's request to rescind the review with respect to Company A was untimely, and its decision not to collapse Company A.
On September 1, 2017, Commerce published notice of an opportunity to request an administrative review of the Order. See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Admin. Review , 82 Fed. Reg. 41,595 (Dep't Commerce Sept. 1, 2017). Hyundai submitted its request for review on September 29, 2017. See Hyundai's Request for Admin. Rev. (Sept. 27, 2017), P.R. 2.
On October 2, 2017, the petitioners, including U.S. Steel, requested review of several companies, including Hyundai's affiliate, Company A.8 See Pet'rs’ Request for Admin. Rev. (Oct. 2, 2017), P.R. 4.
On November 13, 2017, Commerce published notice of the initiation of the first administrative review of the Order. See Initiation of Antidumping and Countervailing Duty Admin. Revs. , 82 Fed. Reg. 52,268 (Dep't Commerce Nov. 13, 2017). The period of review was March 7, 2016, through August 31, 2017.
On February 14, 2018, the petitioners timely withdrew their request with respect to all of the companies they had asked Commerce to review, except Company A and POSCO/POSCO Daewoo Corp. ("POSCO/PDW"), a Korean producer and exporter.9 See Letter from Pet'rs to Sec'y Wilber Ross, Jr. (Feb. 14, 2018), P.R. 32.
Thereafter, the Department selected Hyundai and POSCO/PDW as mandatory respondents, stating they were the two largest producers and exporters of subject merchandise by volume during the period of review.10 Commerce sent its initial and supplemental questionnaires to each of the mandatory respondents. Both timely filed responses. See Commerce's Initial Quest. Secs. A-E (Feb. 8, 2018), P.R. 25 ("Initial Questionnaire"); Commerce's First Suppl. Quest. Secs. A-E (June 18, 2018), P.R. 130 ("Supplemental Questionnaire").
In Sections B (home market sales) and C (U.S. sales) of its Initial Questionnaire, Commerce asked for information regarding, inter alia , Hyundai's "product codes" for products sold in Korea and the United States during the period of review. A product code is the internal code a company assigns to a product in the ordinary course of its business. See, e.g. , Hyundai's Sec. B Quest. Resp. (Mar. 30, 2018), P.R. 82-84 at B-8. Product codes were to be reported in the computer field "PRODCODU/H."11 These codes were then to be correlated to a matching control number, or CONNUM,12 that the Department used in the calculation of a dumping margin. Product codes were not, however, used to construct the CONNUMs themselves.
Commerce's instructions did not require Hyundai to use any particular method to report its product codes. Regarding products sold in the home market, the Section B instructions stated: "Report the commercial product code assigned by your company in the normal course of business to the specific product sold." Hyundai's Sec. B Quest. Resp. at B-8. Similarly, regarding products sold in the U.S. market, the Section C instructions stated: "Report the commercial product code assigned by your company in the normal course of business to the specific product sold in the United States." Initial Questionnaire at B-38.
For products that were further manufactured in the United States, however, Commerce's Section C instructions provided some additional detail. The instructions stated that if, as in Hyundai's case,13 "the product sold is further manufactured in the United States, report the product code of the product sold not the product imported ." Initial Questionnaire at B-38 (emphasis added). In its brief before the court, Hyundai...
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