Itochu Bldg. Prods. Co. v. United States
| Decision Date | 22 June 2017 |
| Docket Number | Slip Op. 17-73,Consol. Court No. 12-00065 |
| Parties | ITOCHU BUILDING PRODUCTS CO., INC., TIANJIN JINCHI METAL PRODUCTS CO., LTD., TIANJIN JINGHAI COUNTY HONGLI INDUSTRY & BUSINESS CO., CERTIFIED PRODUCTS INTERNATIONAL INC., CHIIEH YUNGS METAL IND. CORP., HUANGHUA JINHAI HARDWARE PRODUCTS CO., LTD., SHANGDONG DINGLONG IMPORT & EXPORT CO., LTD., TIANJIN ZHONGLIAN METALS WARE CO., LTD., HENGSHUI MINGYAO HARDWARE & MESH PRODUCTS CO., LTD., HUANGHUA XIONGHUA HARDWARE PRODUCTS CO., LTD., SHANGHAI JADE SHUTTLE HARDWARE TOOLS CO., LTD., SHANGHAI YUEDA NAILS INDUSTRY CO., LTD., SHANXI TIANLI INDUSTRIES CO., LTD., CHINA STAPLE ENTERPRISE (TIANJIN) CO., LTD., QIDONG LIANG CHYUAN METAL INDUSTRY CO., LTD., ROMP (TIANJIN) HARDWARE CO., LTD., CYM (NANJING) NINGQUAN NAIL MANUFACTURE CO., LTD. a/k/a CYM (NANJING) NAIL MANUFACTURE CO., LTD., SHANXI PIONEER HARDWARE INDUSTRIAL CO., LTD., and MINGGUANG ABUNDANT HARDWARE PRODUCTIONS CO., LTD., Plaintiffs, THE STANLEY WORKS (LANGFANG) FASTENING SYSTEMS CO., LTD., and STANLEY BLACK & DECKER, INC., Consolidated Plaintiffs, v. UNITED STATES, Defendant, MID CONTINENT NAIL CORPORATION, Defendant-Intervenor. |
| Court | U.S. Court of International Trade |
Before: Jane A. Restani, Judge
Public Version
OPINION
Ned H. Marshak, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, of Washington, DC, argued for plaintiffs. With him on the brief were Bruce M. Mitchell, Mark E. Prado, and Dharmendra N. Choudhary.
Lawrence J. Bogard, Neville Peterson, LLP, of Washington, DC, argued for consolidated plaintiffs.
Tara K. Hogan, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With her on the brief were Chad A. Readler, Acting Assistant Attorney General, Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, and Sosun Bae, Trial Attorney. Of counsel on the brief was Jessica DiPietro, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.
Adam H. Gordon, The Bristol Group PLLC, of Washington, DC, argued for defendant-intervenor. With him on the brief was Ping Gong.
Restani, Judge: The instant litigation challenges the U.S. Department of Commerce ("Commerce")'s final results of the second administrative review of the antidumping ("AD") duty order on certain steel nails from the People's Republic of China ("PRC"). Certain Steel Nails from the People's Republic of China: Final Results and Final Partial Rescission of the Second Antidumping Duty Administrative Review, 77 Fed. Reg. 12,556, 12,556 (Dep't Commerce Mar. 1, 2012) ("Final Results"); see also Certain Steel Nails from the People's Republic of China: Amended Final Results of the Second Antidumping Duty Administrative Review, 77 Fed. Reg. 24,462, 24,462 (Dep't Commerce Apr. 24, 2012). Before the court are three motions for judgment on the agency record pursuant to U.S. Court of International Trade Rule 56.2, one by plaintiffs Tianjin Jinchi Metal Products Co., Ltd. ("Jinchi"), Tianjin Jinghai County Hongli Industry & Business Co. ("Hongli"), Certified Products International Inc., Chiieh Yungs Metal Ind. Corp., Huanghua Jinhai Hardware Products Co., Ltd., Shangdong Dinglong Import & Export Co., Ltd., Tianjin Zhonglian Metals Ware Co., Ltd., Hengshui Mingyao Hardware & Mesh Products Co., Ltd., Huanghua Xionghua Hardware Products Co., Ltd., Shanghai Jade Shuttle Hardware Tools Co., Ltd., Shanghai Yueda Nails Industry Co., Ltd., Shanxi Tianli Industries Co., Ltd., China Staple Enterprise (Tianjin) Co., Ltd., Qidong Liang Chyuan Metal Industry Co., Ltd., Romp (Tianjin) Hardware Co., Ltd., CYM (Nanjing) Ningquan Nail Manufacture Co., Ltd. a/k/a CYM (Nanjing) Nail Manufacture Co., Ltd., Shanxi Pioneer Hardware Industrial Co., Ltd., Mingguang Abundant Hardware Productions Co., Ltd., and Itochu Building Products Co., Inc. (collectively, "Itochu"); another by consolidated plaintiffs The Stanley Works (Langfang) Fastening Systems Co., Ltd. ("Stanley Langfang") and Stanley Black & Decker, Inc. (collectively, "Stanley"); and the last by defendant-intervenor Mid Continent Nail Corporation ("Mid Continent"). See Mem. in Supp. of the Rule 56.2 Mot. for Pls. The Stanley Works (Langfang) Fastening Systems Co., Ltd. and Stanley Black & Decker Inc. for J. upon the Admin. R., ECF No. 39-4 ("Stanley Br."); Pls.' Rule 56.2 Mot. for J. upon the Agency R., ECF No. 40 ("Itochu Br."); Mid Continent's Rule 56.2 Mot. for J. on the Agency R., ECF No. 41 ("Mid Continent Br."). Also, before the court, is the government's motion for partial remand. Def.'s Mot. for Voluntary Partial Remand & Consent Mot. for Errata, ECF No. 120 ("Gov't Mot. for Partial Remand"). For the reasons stated below, Commerce's Final Results are remanded, and the government's motion for partial remand is granted.
On September 29, 2010, Commerce published a notice of initiation for 222 companies of the second administrative review of the AD order on certain steel nails from the PRC, covering the period of review ("POR") of August 1, 2009, through July 31, 2010. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 75 Fed. Reg. 60,076, 60,078-81 (Dep't Commerce Sept. 29, 2010) ("Initiation Notice"). On December 16, 2010, Commerce selected the three largest exporters by volume as mandatory respondents: Stanley, Hongli, and Qingdao Jisco Co., Ltd. ("Jisco"). First Respondent Selection Mem. at 6-7, CD 51 pt. 11 (Dec. 16, 2010); see Certain Steel Nails from the People's Republic of China: Preliminary Results and Preliminary Rescission, in Part, of the Antidumping Duty Administrative Review and Preliminary Intent to Rescind New Shipper Review, 76 Fed. Reg. 56,147, 56,148 (Dep't Commerce Sept. 12, 2011) ("Preliminary Results"). After Commerce received requests from both Jisco and Mid Continent to withdraw their respective requests for review of Jisco, Commerce replaced Jisco and selected Jinchi as the third mandatory respondent. Second Respondent Selection Mem. at 2, PD 147 pt. 1 (Jan. 21, 2011); see Preliminary Results, 76 Fed. Reg. at 56,148.
Commerce considers the PRC to be a non-market economy ("NME"). In calculating a dumping margin for subject merchandise from an NME country, Commerce compares the goods' normal value,2 derived from factors of production ("FOPs") as valued in a surrogatemarket economy ("ME") country, to the goods' export price.3 Commerce must use the "best available information" in selecting surrogate data. 19 U.S.C. § 1677b(c)(1)(B) (2006). The surrogate data must "to the extent possible" be from one or more ME countries that are "at a level of economic development comparable to that of the nonmarket economy country, and" are "significant producers of comparable merchandise." Id. § 1677b(c)(4).
On September 12, 2011, Commerce issued its Preliminary Results. 76 Fed. Reg. at 56,147. To calculate the surrogate financial ratios,4 Commerce relied on the financial statements of three Indian companies: Bansidhar Granites ("Bansidhar"), Nasco Steel Pvt. Ltd. ("Nasco"), and J&K Wire and Steel ("J&K"). Id. at 56,154. Moreover, Commerce applied neutral facts otherwise available5 to fill gaps created by unreported FOP data from bothunaffiliated tollers6 and unaffiliated suppliers used by the mandatory respondents. Id. at 56,148-49. Commerce noted that Stanley and Jinchi "used unaffiliated tollers for production of tolled intermediate inputs" and found that neither failed to cooperate, even though each respondent was unsuccessful at obtaining FOP data from their tollers, because each respondent documented their attempts to obtain the missing information. Id. at 56,148. Commerce also explained that all three mandatory respondents, failed to provide FOP data from unaffiliated suppliers of subject merchandise. Id. at 56,149. Although Hongli did provide the FOP data for its supplier before the Preliminary Results, Commerce rejected it as unsolicited and untimely because it was submitted after the deadline. Id. Nevertheless, Commerce found that no respondent failed to cooperate by not acting to the best of its ability because each "attempted to obtain the FOPs from the unaffiliated producers and documented these attempts." Id. Commerce stated, however, that after the Preliminary Results, it would issue questionnaires directly to each of the mandatory respondents' unaffiliated suppliers for whom FOP data was unreported. Id.
On March 1, 2012, Commerce published the Final Results. 77 Fed. Reg. at 12,556. In the Final Results, Commerce determined it would no longer rely on Nasco's and J&K's financial statements because those data were not contemporaneous with the POR. Certain Steel Nails from the People's Republic of China: Issues and Decision Memorandum for the Final Results of the Second Antidumping Duty Administrative Review at 12, PD 117 pt. 2 (Feb. 23, 2012) ("I&DMemo"). Instead, Commerce averaged the financial statements of Bansidhar and Sundram Fasteners Limited ("Sundram"). Id. at 11. As a result of this change, the surrogate financial ratio for factory overhead increased from 2.98% to 22.19%, the ratio for selling, general, and administrative expenses increased from 9.10% to 11.79%, and the ratio for profit increased from 1.13% to 4.99%. Compare Surrogate Values for the Preliminary Results at 16, PD 7-11 pt. 2 (Aug. 31, 2011), with Surrogate Values for the Final Results at 3, PD 106 pt. 2 (Feb. 23, 2012) ("SVs for Final Results").
With respect to the facts available determinations, Commerce continued to apply partial neutral facts available to Stanley and Jinchi for the unreported FOP data from their unaffiliated tollers. I&D Memo at 18-19, 26-27. Commerce did not apply facts available to Hongli because its unaffiliated supplier of cut plate masonry nails7 responded to...
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