Jacobi Carbons Ab, Jacobi Carbons, Inc. v. United States

• Decision Date: 24 June 2014
• Docket Number: Court No. 12–00365.,Slip Op. 14–70.
• Citation: 992 F.Supp.2d 1360
• Parties: JACOBI CARBONS AB, Jacobi Carbons, Inc., Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd., Cherishmet Inc., Beijing Pacific Activated Carbon Products Co., Ltd., Datong Municipal Yunguang Activated Carbon Co., Ltd., Shanxi Industry Technology Trading Co., Ltd., Carbon Activated Corp., Car Go Worldwide, Inc., and Tangshan Solid Carbon Co., Ltd., Plaintiffs, v. UNITED STATES, Defendant, and Calgon Carbon Corp. and Norit Americas, Inc., Defendant–Intervenors.
• Court: U.S. Court of International Trade

992 F.Supp.2d 1360

JACOBI CARBONS AB, Jacobi Carbons, Inc., Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd., Cherishmet Inc., Beijing Pacific Activated Carbon Products Co., Ltd., Datong Municipal Yunguang Activated Carbon Co., Ltd., Shanxi Industry Technology Trading Co., Ltd., Carbon Activated Corp., Car Go Worldwide, Inc., and Tangshan Solid Carbon Co., Ltd., Plaintiffs,

v.UNITED STATES, Defendant,andCalgon Carbon Corp. and Norit Americas, Inc., Defendant–Intervenors.

Slip Op. 14–70.

Court No. 12–00365.

United States Court of

International Trade.

June 24, 2014.

Daniel L. Porter, Curtis, Mallet–Prevost, Colt & Mosle LLP, of Washington, D.C., argued for plaintiffs Jacobi Carbons AB and Jacobi Carbons, Inc. With him on the brief was Ross Bidlingmaier.

Francis J. Sailer, Grunfeld Desiderio Lebowitz Silverman & Klestadt LLP, of Washington, D.C., argued for consolidated plaintiffs Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd., Cherishmet Inc., Beijing Pacific Activated Carbon Products Co., Ltd., Datong Municipal Yunguang Activated Carbon Co., Ltd., and Shanxi Industry Technology Trading Co., Ltd. With him on the briefs were Mark E. Pardo, Dharmendra N. Choudhary, Andrew T. Schutz, and Kavita Mohan.

Nancy A. Noonan and Matthew L. Kanna, Arent Fox LLP, of Washington, D.C., for consolidated plaintiffs Carbon Activated Corp. and Car Go Worldwide, Inc.

Gregory S. Menegaz, deKieffer & Horgan, PLLC, of Washington, D.C., for consolidated plaintiff Tangshan Solid Carbon Co., Ltd.

Antonia R. Soares, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, D.C., argued for defendant. On the brief were Melissa M. Devine, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, Stuart F. Delery, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel on the brief was Devin S. Sikes, Attorney, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, of Washington, D.C.

John M. Herrmann, Kelley Drye & Warren, LLP, of Washington, D.C., argued for defendant-intervenors Calgon Carbon Corp. and Norit Americas, Inc. With him on the brief were David A. Hartquist and R. Alan Luberda.

OPINION

EATON, Judge:

This matter is before the court on the USCIT Rule 56.2 motions for judgment on the agency record of plaintiffs Jacobi Carbons AB and Jacobi Carbons, Inc. (collectively, “Jacobi”),¹ and consolidated plaintiffs ² Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd. (“GHC”), Cherishmet Inc. (“Cherishmet”), Beijing Pacific Activated Carbon Products Co., Ltd. (“BPACP”), Datong Municipal Yunguang Activated Carbon Co., Ltd. (“Datong Municipal”), Shanxi Industry Technology Trading Co., Ltd. (“Shanxi Industry”), Carbon Activated Corp. and Car Go Worldwide, Inc. (collectively, “CAC”), and Tangshan Solid Carbon Co., Ltd. (“Tangshan”) (collectively, “plaintiffs”). By their motions, plaintiffs, all of which are producers, exporters, or importers of subject merchandise,³ challenge the U.S. Department of Commerce's (“Commerce” or the “Department”) Final Results in the fourth administrative review of the antidumping duty order on certain activated carbon from the People's Republic of China (“PRC”). Certain Activated Carbon From the PRC, 77 Fed.Reg. 67,337 (Dep't of Commerce Nov. 9, 2012) (final results of antidumping duty admin. review), and accompanying Issues and Decision Memorandum (“Issues & Dec. Mem.”) (collectively, “Final Results”).

Jacobi, GHC, Cherishmet, BPACP, Datong Municipal, CAC, and Tangshan contest two aspects of the Department's Final Results: (1) the selection of the surrogate value for carbonized material, which is one of the primary inputs used in the production of subject merchandise; ⁴ and (2) the selection of the surrogate value for truck freight. See Resp't Pls.' Rule 56.2 Mot. for J. on the Agency R. 1–2 (ECF Dkt. No. 47) (“Jacobi's Br.”); Mem. in Supp. of Pls.' Rule 56.2 Mot. for J. upon the Agency R. 1 (ECF Dkt. No. 46) (“GHC's Br.” ⁵); Rule 56.2 Mot. for J. upon the Agency R. of Pls. Carbon Activated Corporation and Car Go Worldwide, Inc. 2 (“CAC's Mot.”); Consol. Pl. Tangshan Solid Carbon Co., Ltd.'s Rule 56.2 Mot. for J. on the Agency R. 1–2 (“Tangshan's Mot.”).

Shanxi Industry and Tangshan (collectively, “separate rate companies” or “separate rate respondents”) are plaintiffs that established their independence from Chinese government control, and as a result, were assigned a separate antidumping duty rate in the Final Results. SeeFinal Results, 77 Fed.Reg. at 67,338. The separate rate respondents and CAC ⁶ claim that, should Commerce recalculate the final dumping margin for the mandatory respondents pursuant to any remand ordered by the court, the Department must also recalculate the rate assigned to the separate rate companies. See Mem. of Law in Supp. of Pl. Shanxi Industry Technology Trading Co., Ltd.'s Rule 56.2 Mot. for J. upon the Agency R. 2 (ECF Dkt. No. 44) (“Shanxi Industry's Br.”); Tangshan's Mot. 2; CAC's Mot. 2.

Defendant United States opposes plaintiffs' motions and asks that Commerce's Final Results be sustained. Def.'s Resp. to Pls.' and Consol. Pls.' Mots. for J. upon the Agency R. 2 (ECF Dkt. No. 56) (“Def.'s Br.”). Defendant-intervenors, Calgon Carbon Corp. and Norit Americas, Inc. (collectively, “defendant intervenors”), each domestic manufacturers of activated carbon, join in opposition to plaintiffs' motions. Def.-Ints.' Resp. in Opp'n to Consol. Pls.' Mots. for J. on the Agency R. 1 (ECF Dkt. No. 58) (“Def.-Ints.' Br.”). Jurisdiction lies pursuant to 28 U.S.C. § 1581(c) (2006) and 19 U.S.C. §§ 1516a(a)(2)(A)(i)(I), (B)(iii) (2006). For the reasons set out below, Commerce's Final Results are sustained.

BACKGROUND

On April 27, 2007, the Department issued the antidumping duty order on certain activated carbon from the PRC. Certain Activated Carbon From the PRC, 72 Fed.Reg. 20,988, 20,988 (Dep't of Commerce Apr. 27, 2007) (notice of antidumping duty order) (the “Order”). Following timely requests from defendant-intervenors and other companies, the Department conducted its fourth administrative review of the Order for the period of review (“POR”), April 1, 2010, through March 31, 2011. Initiation of Antidumping and Countervailing Duty Administrative Reviews, 76 Fed.Reg. 30,912, 30,913 (Dep't of Commerce May 27, 2011).

On May 4, 2012, the Department published its Preliminary Results for the review, selecting Datong Juqiang Activated Carbon Co., Ltd.,⁷ Jacobi, and GHC as mandatory respondents. Certain Activated Carbon from the PRC, 77 Fed.Reg. 26,496, 26,497 (Dep't of Commerce May 4, 2012) (preliminary results of the fourth antidumping duty admin. review, and intent to rescind in part) (“Preliminary Results”). BPACP, Datong Municipal, Shanxi Industry, and Tangshan each filed separate rate certifications, and Cherishmet and CAC joined as interested U.S. importers. SeePreliminary Results, 77 Fed.Reg. at 26,501. In the Preliminary Results, Commerce “selected Thailand as the primary surrogate country for the valuation of the [factors of production] and surrogate financial ratios.” Mem. from Katie Marksberry, International Trade Specialist, to the File at 1, PD 193, at bar code 3072722–01 (Apr. 30, 2012), ECF Dkt. No. 43 (Apr. 5, 2013) (“Preliminary Results Surrogate Values Mem.”).

Following publication of the Preliminary Results, Jacobi, GHC, Cherishmet, and BPACP submitted comments that placed on the record additional data from the Philippines, and urged the Department to use it to value all of the major material inputs. Issues & Dec. Mem. at cmt. 1. In the Final Results, Commerce found that “both the Philippines and Thailand [were] significant producers [of activated carbon] because, in quantity terms, they [were] exporters of goods identical to the subject merchandise, [and] ha[d] production of comparable merchandise as evidenced by the financial statements on the record.” Issues & Dec. Mem. at cmt. 1. The Department determined, however, that although otherwise “relatively equal in terms of quality and satisf[action] of all of the surrogate value criteria,” the Philippine data (particularly the financial statements) was “clearly superior” to the Thai data because it was “industry-specific, whereas the Thai data [was] for the manufacturing sector in general.” Issues & Dec. Mem. at cmt. 1. The Philippine data was also found to be more contemporaneous to the POR than the Thai data. Issues & Dec. Mem. at cmt. 1.

As a result, Commerce departed from its determination in the Preliminary Results, and selected the Philippines as the primary surrogate country to value most of the major material inputs used in the production of subject merchandise, including the carbonized material and truck freight.⁸Final Results, 77 Fed.Reg. at 67,338. Specifically, the Department used Harmonized Tariff Schedule (“HTS”) ⁹ import data, derived from the Global Trade Atlas (“GTA”), from the Philippines under heading HTS 4402 (“Wood Charcoal (Including Shell or Nut Charcoal), Whether or Not Agglomerated”) to value carbonized material, and used publicly available data reported in the Cost of Doing Business in Legazpi City, Philippines (“Cost of Doing Business”) to value truck freight. Mem. from Emeka Chukwudebe, Case Analyst, to the File at 3, 6, PD 283, at bar code 3104537–01 (Nov. 2, 2012), ECF Dkt. No. 43 (Apr. 5, 2013) (“Final Results Surrogate Values Mem.”).

STANDARD OF REVIEW

“The 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.” 19 U.S.C. § 1516a(b)(1)(B)(i) (2006).

DISCUSSION

I. Legal Framework

“The United States imposes duties on foreign-produced goods that are sold in the United States at less-than-fair value.” Clearon Corp. v. United States, 37 CIT ––––, ––––, Slip Op. 13–22, at 4, 2013 WL...