Icdas Celik Enerji Tersane Ve Ulasim Sanayi, A.S. v. United States

• Decision Date: 23 September 2020
• Docket Number: Slip Op. 20-137,Consol. Court No. 18-00143
• Citation: 475 F.Supp.3d 1293
• Parties: ICDAS CELIK ENERJI TERSANE VE ULASIM SANAYI, A.S., Plaintiff, Habas Sinai Ve Tibbi Gazlar Istihsal Endustrisi A.S., Consolidated Plaintiff, v. The UNITED STATES, Defendant, and Nucor Corporation, Charter Steel and Keystone Consolidated Industries, Inc., Defendant-Intervenors.
• Court: U.S. Court of International Trade

475 F.Supp.3d 1293

ICDAS CELIK ENERJI TERSANE VE ULASIM SANAYI, A.S., Plaintiff,

Habas Sinai Ve Tibbi Gazlar Istihsal Endustrisi A.S., Consolidated Plaintiff,

v.The UNITED STATES, Defendant,andNucor Corporation, Charter Steel and Keystone Consolidated Industries, Inc., Defendant-Intervenors.

Slip Op. 20-137

Consol. Court No. 18-00143

United States Court of International Trade.

September 23, 2020

Matthew M. Nolan and Leah N. Scarpelli, Arent Fox LLP, of Washington, DC, for plaintiff.

David L. Simon, Law Office of David L. Simon, of Washington, DC, for consolidated plaintiff.

Elizabeth A. Speck, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for defendant United States. With her on the brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, L. Misha Preheim, Assistant Director. Of counsel on the brief was Nikki Kalbing, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Maureen E. Thorson, Derick G. Holt, and Jeffrey O. Frank, Wiley Rein LLP, of Washington, DC, for defendant-intervenor Nucor Corporation.

R. Alan Luberda, Kelley Drye & Warren, LLP, of Washington, DC, for defendant-intervenors Charter Steel and Keystone Consolidated Industries, Inc.

OPINION

Katzmann, Judge:

The court returns to an antidumping ("AD") investigation by the United States Department of Commerce ("Commerce") on imports of carbon and alloy steel wire rod ("wire rod") imported into the United States from Turkey. Before the court is Commerce's Final Results of Redetermination Pursuant to Court Remand (Apr. 27, 2020), ECF No. 55 ("Remand Results"), which the court ordered in Icdas Celik Enerji Tersane Ve Ulasim Sanayi, A.S., v. United States, 44 CIT ––––, 429 F. Supp. 3d 1353 (2020) (" Icdas I"), so that Commerce could recalculate its duty drawback adjustment in accordance with the court's instructions. Plaintiff Icdas Celik Enerji Tersane ve Ulasim Sanayi, A.S. ("Icdas") and consolidated-plaintiff Habas Sinai ve Tibbi Gazlar Istihsal Endustrisi A.S. ("Habas") (collectively, "Plaintiffs") again challenge Commerce's methodology for calculating their respective AD margins. Pl. Icdas's Comments on Final Results of Redetermination, May 27, 2020, ECF No. 58 ("Pl.’s Br."); Comments of Consol. Pl. Habas in Opp'n to Redetermination on Remand, May 27, 2020, ECF No. 57 ("Consol. Pl.’s Br."). Defendant the United States ("the Government") and Defendant-Intervenor Nucor Corporation ("Nucor") request that the court affirm Commerce's Remand Results. Def.’s Resp. to Comments on Remand Redetermination, June 23, 2020, ECF No. 59 ("Def.’s Br."); Nucor Corp.’s Resp. to Comments on Final Results of Redetermination, June 26, 2020, ECF No. 60 ("Def.-Inter.’s Br."). The court agrees with Plaintiffs that Commerce's remand methodology is not in accordance with law and thus again remands the duty drawback methodology to Commerce.

PROCEDURAL BACKGROUND

The court set out the relevant legal and factual background of the proceedings in further detail in its previous opinion, Icdas I, 429 F. Supp. 3d at 1357-60. Information relevant to the instant opinion is set forth below.

On March 28, 2017, Commerce initiated an AD investigation into wire rod from Turkey based on petitions from domestic producers alleging that imports of wire rod were being imported into the United States to the detriment of the domestic industry. See Carbon and Alloy Steel Wire Rod From Belarus, Italy, the Republic of Korea, the Russian Federation, South Africa, Spain, the Republic of Turkey, Ukraine, United Arab Emirates, and United Kingdom: Initiation of Less-Than-Fair-Value Investigations, 82 Fed. Reg. 19,207, 19,207 (Dep't Commerce Apr. 26, 2017), P.R. 8. After the requisite investigation, Commerce agreed with petitioners and calculated AD margins for Icdas and Habas of 7.94 percent and 4.93 percent, respectively, and an "All Others" rate of 6.34 percent. See Carbon and Alloy Steel Wire Rod from Italy, the Republic of Korea, Spain, the Republic of Turkey, and the United Kingdom, 83 Fed. Reg. 23,417 (Dep't Commerce May 21, 2018), P.R. 1289; Carbon and Alloy Steel Wire Rod from Turkey: Final Determination of Sales at Less Than Fair Value and Final Negative Determination of Critical Circumstances, 83 Fed. Reg. 13,249, 13,250 (Dep't Commerce Mar. 28, 2018), P.R. 1285. In its investigation, Commerce determined that Icdas and Habas satisfied the criteria of 19 U.S.C. § 1677a(c)(1)(B) (2012)¹ and qualified for a duty drawback adjustment on rebates of duties paid on goods that were subsequently exported, pursuant to Turkey's Inward Processing Regime. See Mem. from J. Maeder to G. Taverman, re: Decision Mem. for the Prelim. Determination and Negative Determination of Critical Circumstances at 10 (Dep't Commerce Oct. 24, 2017), P.R. 951. In calculating the duty drawback adjustment, Commerce employed a "duty neutral" methodology, which allocated duty drawback over "all production for the relevant period ...." Id. at 11; Mem. from J. Maeder to G. Taverman, re: Issues and Decision Mem. for the Final Affirmative Determination and Negative Determination of Critical Circumstances at 9 (Dep't Commerce Mar. 19, 2018), P.R. 1273 ("IDM"). As Commerce explained in the IDM, to fairly compare "[export price] with [normal value], ... Commerce will make the duty drawback adjustment to [export price] in a manner that will render this comparison duty neutral." Id. at 9. Thus, Commerce "made an upward adjustment to [export price] based on the amount of the duty imposed on the input and rebated or not collected on the export of the subject merchandise by allocating the amount rebated or not collected to all production for the relevant period based on the cost of inputs during the POI." Id. at 9.

Plaintiffs challenged the Amended Final Determination before the court. Icdas's Summons, June 19, 2018, ECF No. 1; Icdas's Compl., July 19, 2018, ECF No. 8; Habas’s Summons, Habas v. United States, No. 18-145 (CIT filed June 19, 2018), ECF No. 1; Habas’s Compl., Habas, No. 18-145, ECF No. 6 (CIT filed July 12, 2018); Joint Mot. to Consol. Cases, Sept. 20, 2018, ECF No. 23; Ct. Order Granting Mot., Sept. 26, 2018, ECF No. 26. Plaintiffs claimed, in relevant part, that the duty neutral methodology employed by Commerce to calculate the duty drawback adjustment contradicts the plain language of 19 U.S.C. § 1677a(c), resulting in higher AD duties on their exports of wire rod from Turkey by not affording Plaintiffs their full duty drawback adjustment. Icdas I, 429 F. Supp. 3d at 1360. The court agreed, holding that the duty neutral methodology was contrary to law. Id. at 1360-65. The court remanded the duty drawback methodology "with instructions to recalculate the duty drawback adjustment." Id. at 1365.

On remand, Commerce added the full amount of exempted duties to export price as directed by the court. Remand Results at 12. Further, Commerce made two circumstances of sale adjustments ("COS adjustments") to normal value to increase it by the same amount as the duty drawback adjustment. Id. at 15-16. Commerce calculated new dumping margins of 8.72 percent and 3.22 percent for Icdas and Habas, respectively, and an All Other rate of 4.78 percent. Id. at 44. The Government filed the final Remand Results with the court on April 27, 2020. See id. Plaintiffs filed their comments on the Remand Results on May 27, 2020. Pl.’s Br.; Consol. Pl.’s Br. The Government and Nucor filed replies to these comments on June 26, 2020. Def's Br.; Def.-Inter.’s Br.

JURISDICTION, STANDARD OF REVIEW, AND INTERPRETIVE FRAMEWORK

The court has jurisdiction over this action pursuant to 28 U.S.C. § 1581(c) and 19 U.S.C. § 1516a(a)(2)(B)(i). The standard of review in this action is set forth in 19 U.S.C. § 1516a(b)(1)(B)(i) : "[t]he court shall hold unlawful any determination, finding or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law." The court also reviews the Remand Results "for compliance with the court's remand order." See Beijing Tianhai Indus. Co. v. United States, 39 CIT ––––, ––––, 106 F. Supp. 3d 1342, 1346 (2015) (citations omitted).

The two-part framework established in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), guides the court's review of Commerce's statutory interpretation. See also Apex Frozen Foods Private Ltd. v. United States, 862 F.3d 1322, 1329 (Fed. Cir. 2017). Under Chevron’s first prong, the court asks "whether Congress has directly spoken to the precise question at issue." 467 U.S. at 842, 104 S.Ct. 2778. See also Apex Frozen Foods, 862 F.3d at 1329. "If yes, ‘that is the end of the matter,’ and we ‘must give effect to the unambiguously expressed intent of Congress.’ " Apex Frozen Foods, 862 F.3d at 1329 (quoting Chevron, 467 U.S. at 842-43, 104 S.Ct. 2778 ). If, however, "the statute is silent or ambiguous with respect to the specific issue," the court proceeds to the second prong of the Chevron analysis. Id. (quoting Chevron, 467 U.S. at 843, 104 S.Ct. 2778 ). "[T]he question for the court" then becomes "whether the agency's answer is based on a permissible construction of the statute." Chevron, 467 U.S. at 843, 104 S.Ct. 2778.

DISCUSSION

Plaintiffs challenge Commerce's Remand Results, claiming that the COS adjustment to normal value did not comply with court's remand order and was not in accordance with law -- specifically the statute, Commerce's regulations, and recent persuasive caselaw. See Pl.’s Br. at 4-14; Consol. Pl.’s Br. at 1-11. Because Commerce's remand methodology contravenes the plain language of the statute and did not comply with the court's previous opinion, the court remands to Commerce for a second time.

I. Legal Framework

As discussed in detail Icdas I, 429 F. Supp. 3d at 1361-62, pursuant to statute, "if a foreign country...