Jacobi Carbons AB v. United States

• Citation: 313 F.Supp.3d 1344
• Decision Date: 19 April 2018
• Docket Number: Slip Op. 18–47,Consol. Court No. 16–00185
• Parties: JACOBI CARBONS AB and Jacobi Carbons, Inc., Plaintiffs, and Ningxia Huahui Activated Carbon Co., Ltd., et al., Plaintiff–Intervenors, v. UNITED STATES, Defendant, and Calgon Carbon Corp. and Cabot Norit AM., Inc, Defendant–Intervenors.
• Court: U.S. Court of International Trade

313 F.Supp.3d 1344

JACOBI CARBONS AB and Jacobi Carbons, Inc., Plaintiffs,

and

Ningxia Huahui Activated Carbon Co., Ltd., et al., Plaintiff–Intervenors,

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

Slip Op. 18–47

Consol. Court No. 16–00185

United States Court of International Trade.

Dated: April 19, 2018

Daniel L. Porter and Tung A. Nguyen, Curtis, Mallet–Prevost, Colt & Mosle LLP, of Washington, DC, argued for Plaintiffs Jacobi Carbons AB and Jacobi Carbons, Inc.

Gregory S. Menegaz and Alexandra H. Salzman, DeKieffer & Horgan PLLC, of Washington, DC, argued for Plaintiff–Intervenors Carbon Activated Corporation, Ningxia Mineral and Chemical Ltd., Shanxi DMD Corp., Shanxi Industry Technology Trading Co., Ltd., Shanxi Sincere Industrial Co., Ltd., Tianjin Channel Filters Co. Ltd., and Tianjin Maijin Industries Co., Ltd. With them on the brief was J. Kevin Horgan.

Lizbeth R. Levinson and Ronald M. Wisla, Fox Rothschild, LLP, of Washington, DC, for Plaintiff–Intervenor Ningxia Huahui Activated Carbon Co., Ltd.

Francis J. Sailer, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, of Washington, DC, for Plaintiff–Intervenors Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd, Beijing Pacific Activated Carbon Products Co., Ltd., and Datong Municipal Yunguang Activated Carbon Co., Ltd.

William E. Perry, Emily Lawson, and Adams C. Lee, Harris Bricken McVay, LLP, of Seattle, WA, for Plaintiff–Intervenors M.L. Ball Company, Ltd., and Jilin Bright Future Chemical Company, Ltd.

Mollie L. Finnan, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for Defendant.¹ With her on the brief were Chad A. Readler, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Claudia Burke, Assistant Director. Of counsel on the brief was Emma T. Hunter, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

R. Alan Luberda and Melissa M. Brewer, Kelley Drye & Warren LLP, of Washington, DC, argued for Defendant–Intervenors Calgon Carbon Corp. and Cabot Norit Americas, Inc. With them on the brief were John M. Herrmann and David A. Hartquist.

OPINION AND ORDER

Barnett, Judge:

Plaintiffs Jacobi Carbons AB and Jacobi Carbons, Inc. (together, "Jacobi") and Plaintiff–Intervenors² (collectively, "Plaintiffs") challenge the United States Department of Commerce's ("Commerce" or the "agency") final results in the eighth administrative review ("AR8") of the antidumping duty order ("AD Order") on certain activated carbon from the People's Republic of China ("PRC" or "China"). See Certain Activated Carbon from the People's Republic of China, 81 Fed. Reg. 62,088 (Dep't of Commerce Sept. 8, 2016) (final results of antidumping duty admin. review; 2014–2015) (" Final Results "), ECF No. 44–4, and accompanying Issues and Decision Mem., A–570–904 (Aug. 31, 2016) ("I & D Mem."), ECF No. 44–5, as amended by the Final Results of Redetermination Pursuant to Court Order (Sept. 1, 2017) ("Remand Results"), ECF No. 78–1.³

Plaintiffs challenge Commerce's selection of Thailand as the primary surrogate country and Thai surrogate values for carbonized material, hydrochloric acid, coal tar, and financial ratios; and Commerce's adjustment to Jacobi's constructed export price ("CEP") to account for irrecoverable value added tax ("VAT"). See Confidential Consol. Pls. Jacobi Carbons AB and Jacobi Carbons, Inc.'s Mot. for J. Upon the Agency R. and Br. in Supp. of Mot. for J. on the Agency R. ("Jacobi Rule 56.2 Mem."), ECF No. 48; Consol. Pls. Carbon Activated Corporation, Ningxia Mineral and Chemical Limited, Shanxi DMD Corporation, Shanxi Industry Technology Trading Co., Ltd., Shanxi Sincere Industrial Co., Ltd., Tianjin Channel Filters Co., Ltd., and Tianjin Maijin Industries Co., Ltd. Mot. for J. on the Agency R., ECF No. 51, and Mem. in Supp. of Mot. for J. on the Agency R. ("CAC Rule 56.2 Mem."), ECF No. 53; Pl.–Ints.' Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd., Beijing Pacific Activated Carbon Products Co., Ltd., and Datong Municipal Yunguang Activated Carbon Co., Ltd Mot. for J. on the Agency R. and Br. in Supp. of Mot. for J. on the Agency R. ("Cherishmet Rule 56.2 Mem."), ECF No. 55;⁴ Pl.–Int. Ningxia Huahui Activated Carbon Co., Ltd.'s Mot. for J. on the Agency R. ("Huahui Rule 56.2 Mot."), ECF No. 56;⁵ Pl.–Ints.' M. L. Ball Co., Ltd., and Jilin Bright Future Chemical Company, Ltd. Mot. for J. on the Agency R. and Br. in Supp. ("M.L. Ball Rule 56.2 Mem."), ECF No. 57. For the following reasons, Commerce's Final Results , as amended by the Remand Results, will be sustained with respect to economic comparability, but remanded in all other respects.

BACKGROUND

In May 2015, Commerce initiated this eighth administrative review of the AD Order on certain activated carbon⁶ from the PRC. Initiation of Antidumping and Countervailing Duty Administrative Reviews , 80 Fed. Reg. 30,041 (Dep't Commerce May 26, 2015), CJA Tab. 30, PR 18, ECF No. 92–4. The period of review ("POR") ran from April 1, 2014 to March 31, 2015. Id. at 30,043. Commerce selected Jacobi and Datong Juqiang Activated Carbon Co., Ltd. ("DJAC") as mandatory respondents in the review. Prelim. Mem. at 2–3.

In March 2016, Commerce issued its preliminary results. Certain Activated Carbon From the People's Republic of China , 81 Fed. Reg. 11,513 (Dep't Commerce Mar. 4, 2016) (preliminary results of antidumping duty administrative review; 2014–2015) ("Prelim. Results "), PJA Tab 38, PR 377, ECF No. 92–6. Commerce preliminarily determined that Mexico, Romania, Bulgaria, South Africa, Ecuador, and Thailand were at the same level of economic development as the PRC and, pursuant to its practice, treated each country as equally economically comparable. Prelim. Mem. at 13; Req. for Economic Development, Surrogate Country and Surrogate Value Comments and Information (Aug. 7, 2015) ("Surrogate Country Ltr"), Attach. 1, PJA Tab 20, PR 104, ECF No. 92–3. Commerce also determined that two proposed countries—Malaysia and the Philippines—were not at the same level of economic development as the PRC. Id. at 15. Commerce further determined that Ecuador, Mexico, Romania, South Africa, and Thailand had "significant exports" of the subject merchandise based on data published by the Global Trade Atlas ("GTA") and were, therefore, "significant producers of comparable merchandise" pursuant to 19 U.S.C. § 1677b(c)(4)(B). Id. at 14–15. Because data considerations favored Thailand, Commerce preliminarily selected Thailand as the primary surrogate country. Id. at 15–16. Commerce subsequently relied on Thai data to supply surrogate values for all factors of production, except anthracite coal.⁷ Id. at 15–16, 23–26; Surrogate Values for the Prelim. Results (Feb. 26, 2016) ("Prelim. Surrogate Value Mem.") at 4–11, PJA Tab 9, PR 367, 369, ECF No. 92–2. Commerce also reduced Jacobi's and DJAC's constructed export price and DJAC's export price by 17 percent pursuant to the agency's irrecoverable VAT adjustment. Prelim. Mem. at 21–22. Commerce preliminarily assigned Jacobi and DJAC weighted-average dumping margins of $2.80/kilogram ("kg") and $0.29/kg, respectively, and assigned those companies demonstrating eligibility for a separate rate⁸ a weighted-average dumping margin of $2.22/kg.⁹ Prelim. Results at 11,514.

Commerce issued its final results in September 2016. Final Results , 81 Fed. Reg. 62,088. Commerce continued to rely on Thailand as the primary surrogate country, but made several changes to its surrogate value selections. I & D Mem. at 4–5, 14. Relevant here, with respect to Commerce's surrogate value for Jacobi's carbonized material, Commerce removed "French imports reported in the Thai GTA data under HS ["Harmonized Schedule"] code 4402.90.10000 because the French imports [were] not coconut shell charcoal, but a charcoal used in animal feeds." Surrogate Values for the Final Results (Aug. 31, 2016) ("Final Surrogate Value Mem.") at 2, PJA Tab 16, PR 427, 428, ECF No. 92–3; see also I & D Mem. at 30, 32–33. That change yielded a reduced surrogate value for carbonized material in the amount of 17.3483 Thai Baht ("Baht")/kg. Compare Final Results Analysis Mem. for Jacobi Carbons AB (Aug. 31, 2016) ("Jacobi Final Results Mem.") at Attach. 1, CJA Tab 3, CR 333–334, PJA Tab 17, PR 432–433, ECF No. 91 with Jacobi Prelim. Analysis Mem., Attach. 1 (reflecting a preliminary value of 37.3127 Baht/kg), PJA Tab 10, PR 373, ECF No. 92–2. Commerce further selected (1) Thai HS code 2706 ("Mineral Tars, Including Reconstituted Tars") to value Jacobi's coal tar input, which yielded a surrogate value of 60.9572 Baht/kg; (2) Thai HS code 2806.10.00102 ("Hydrochloric Acid 15% W/W To 36% W/W") to value Jacobi's hydrochloric acid ("HCL") input, which yielded a surrogate value of 77.4643 Baht/kg; and (3) the 2011 financial statement of Thai producer Carbokarn Co., Ltd. ("Carbokarn") to value Jacobi's financial ratios. See I Mem. at 34, 39, 47; Jacobi Final Results Mem. at Attach. 1. Commerce maintained its irrecoverable VAT adjustment, I Mem. at 7, and assigned Jacobi and DJAC respective weighted-average dumping margins of $1.7526/kg and $0.20/kg, Final Results at 62,089. Commerce assigned the separate rate companies a weighted average dumping margin of $1.357/kg. Final Results at 62,089.

On April 7, 2017, the court issued an opinion resolving challenges to Commerce's determination regarding the seventh administrative review ("AR7") of the AD Order on certain activated carbon. See Jacobi Carbons AB v. United States ("Jacobi (AR7) I "), 41 CIT ––––, 222 F.Supp.3d 1159 (2017). The court remanded Commerce's determinations regarding economic comparability and significant production of comparable merchandise, as well as its irrecoverable VAT calculation, for reconsideration or further explanation. Id. at 1165. The court "defer[red] ruling on Plaintiffs'...