Laclede Steel Co. v. U.S.

• Decision Date: 13 November 2000
• Docket Number: Slip Op. 00-151.,Court No. 93-09-00569-CVD.
• Citation: 125 F.Supp.2d 525
• Parties: LACLEDE STEEL CO., et al., Plaintiffs, v. UNITED STATES, Defendant, and Dongbu Steel Co. Ltd., et al., Defendant-Intervenors.
• Court: U.S. Court of International Trade

125 F.Supp.2d 525

LACLEDE STEEL CO., et al., Plaintiffs, v. UNITED STATES, Defendant, and Dongbu Steel Co. Ltd., et al., Defendant-Intervenors.

Slip Op. 00-151.

Court No. 93-09-00569-CVD.

United States Court of International Trade.

November 13, 2000.

Dewey Ballantine LLP (John A. Ragosta, Jennifer Danner Riccardi, and Navin Joneja), Washington, D.C., for plaintiffs.

David W. Ogden, Assistant Attorney General of the United States, David M. Cohen, Director, Commercial Litigation Branch, Civil Division, Department of Justice, A. David Lafer, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, Department of Justice, William L. Olsen, Trial Attorney, Commercial Litigation Branch, Civil Division, Department of Justice, Cindy Buys, Office of the Chief Counsel for Import Administration, United States Department of Commerce, of counsel, Washington, DC, for defendant.

Kaye, Scholer, Fierman, Hays & Handler LLP (Donald B. Cameron, Julie C. Mendoza, and Margaret E. Scicluna), Washington, D.C., for defendant-intervenors.

OPINION

CARMAN, Chief Judge.

This Court upholds the conclusions of Commerce in Final Results of Redetermination on Remand Pursuant to Laclede Steel Co., et al. v. United States (Ct. Int'l Trade, Apr. 5, 2000) (Remand Redetermination). This Court grants Plaintiffs' (Domestic Producers) request that the Remand Redetermination be affirmed in its entirety and denies Defendant-Intervenors' (Korean Respondents) request for a remand to Commerce to recalculate company-specific and countrywide ad valorem rates with respect to all domestic loans received by the Korean steel industry after 1984. Also denied is Korean Respondents' motion for leave to reply to the responses by United States and Domestic Producers.

BACKGROUND

In British Steel P.L.C. v. United States, 941 F.Supp. 119, 130 (C.I.T.1996) (British Steel II), this Court upheld Commerce's determination in Certain Steel Products from Korea, 58 Fed.Reg. 37,338 (July 9, 1993) (Final Determination) that the Korean government program of general control over the Korean financial system provided industry-specific benefits to Korean Respondents in the form of preferential access to long-term loans. To countervail the governmental subsidy, Commerce met the three requirements of 19 U.S.C. § 1677(5) (1988), demonstrating the program was: (1) a government action; (2) that conferred a benefit; (3) upon a specific industry. Because of the indirect nature of the subsidy, this Court had further required Commerce to demonstrate the existence of a causal nexus between the government program and the steel industry's preferential access to credit. See British Steel P.L.C. v. United States, 879 F.Supp. 1254, 1326, 1328 (C.I.T.1995) (British Steel I). Commerce attempted to do so in Final Results of Redetermination Pursuant to Court Remand in British Steel P.L.C. v. United States (Ct. Int'l Trade, February 9, 1995) (First Remand). This Court upheld Commerce's findings. See British Steel II, 941 F.Supp. at 129-130.

Korean Respondents challenged Commerce's determinations on appeal. The United States Court of Appeals for the Federal Circuit (CAFC) reversed the portion of this Court's decision in British Steel II upholding Commerce's finding of a causal nexus between the Korean government's control of the financial system and the domestic loans received by the steel industry from private sources. See AK Steel, 192 F.3d at 1376. It also reversed the portion of this Court's judgment "affirming the assessment of countervailing duties based on preferential access to foreign credit." Id. at 1378. Pursuant to 28 U.S.C. § 1651 (1994), this Court remanded the matter to Commerce to recalculate duties owed in conformity with the CAFC's decision in AK Steel. See Laclede Steel Co., et al. v. United States, 93 F.Supp.2d 1276 (C.I.T.2000).

Conformity with the CAFC's decision required Commerce to exclude from its calculations those countervailing duties based upon: (1) domestic credit provided to the Korean steel industry by private Korean lenders; and (2) preferential access to foreign credit. See AK Steel, 192 F.3d at 1376, 1378. Commerce also determined the CAFC's holding "related only to foreign loans and domestic loans received by the steel industry from private sources during the de facto period [after 1984]."¹ (Remand Redetermination at 3.) Accordingly, Commerce removed from its net subsidy calculations any loans made by private Korean lenders after 1984 and all direct foreign loans. See id. It continued to include post-1984 domestic loans from the following government banks and programs: Korean Development Bank (KDB), Korean Exchange Bank (KEB), Export-Import Bank of Korea (ExIm), Korea Development Finance Corporation (KDFC), National Investment Fund (NIF), Energy Saving Fund (ESF), Petroleum Business Fund (PBF), and Export Industry Facility Loans (EIFL). See id.

Commerce issued its Draft Remand, provided the parties with opportunity to comment, and addressed the parties' comments in the final Remand Redetermination. See id. at 2, 6.

Korean Respondents challenge Commerce's Remand Determination, arguing Commerce has unlawfully distinguished between the private domestic loans and the government-sourced domestic loans. (Dongbu Steel Co., Ltd., et al. Comments Upon the Final Results of Redetermination at 1 (Korean Respondents' Br.).) The United States and Domestic Producers respond that Commerce's distinction between the private domestic loans and the government-sourced domestic loans is consistent with the CAFC's decision. (Defendants' Response to Comments of Dongbu Steel Co. Ltd. et al. on the Final Results of Redetermination Pursuant to Court Remand at 2-3 (Defs.' Resp.)); (Domestic Producers' Brief in Response to Dongbu Steel Co. et al.'s Comments upon the Final Results of Redetermination Pursuant to Court Remand at 2 (Domestic Producers' Resp.).)

JURISDICTION

Because the CAFC's judgment contained no remand order, this Court derives its jurisdiction, in part, from the "mandate rule" wherein the "[i]ssuance of the mandate formally marks the end of appellate jurisdiction," and "[j]urisdiction returns to the tribunal to which the mandate is directed, for such proceedings as may be appropriate...." Carlson v. Hyundai Motor Co., 222 F.3d 1044, 1045 (8th Cir.2000), quoting Johnson v. Bechtel Associates, et. al., 801 F.2d 412, 415 (D.C.Cir.1986). After the CAFC issued its mandate, jurisdiction passed from the CAFC and returned "to the forum from whence it came." Ostrer v. United States, 584 F.2d 594, 599 (2d Cir.1978). Jurisdiction therefore again vested with this Court.

This Court also derives its jurisdiction from the language of the opinion in AK Steel. In order to give effect to the CAFC's specific exclusion of private domestic loans from the countervailing duty determination, Commerce must recalculate the duties owed by Korean Respondents. By not explicitly directing the recalculation, the CAFC left to this Court the task of ordering and reviewing Commerce's recalculation of the countervailing duties. In Exxon Chemical Patents, Inc. v. The Lubrizol Corp., 137 F.3d 1475, 1483 (Fed.Cir. 1998), the CAFC found the lack of an explicit remand order did not preclude additional proceedings in the district court. Rather, "every appellate court judgment vests jurisdiction in the district court to carry out some further proceedings." Id. The nature of those proceedings "is discerned not simply from the language of the judgment, but from the judgment in combination with the accompanying opinion." Id., citing In re Sanford Fork & Tool Co., 160 U.S. 247, 256, 16 S.Ct. 291, 40 L.Ed. 414 (1895).

The scope of this Court's jurisdiction is narrow. In implementing the higher court's mandate, this Court "cannot vary it, or examine it for any other purpose than execution." In re Sanford Fork & Tool Co., 160 U.S. at 255, 16 S.Ct. 291. This Court, therefore, will merely consider whether Commerce's Remand Redetermination conforms with AK Steel and nothing beyond the scope of that decision.

CONTENTIONS OF THE PARTIES

A. Korean Respondents

Korean Respondents first contend that because the interpretation of the CAFC decision is a legal issue that does not involve agency expertise, the Court should afford no deference to Commerce's determination. (Korean Respondents' Br. at 10.) Instead, they reason, the Court should approach the Remand Redetermination with heightened scrutiny. See id.

Korean Respondents next make two arguments contending Commerce has unlawfully interpreted the CAFC's decision by distinguishing between private domestic loans and government-sourced domestic loans. See id. at 11. First, Korean Respondents argue that although the CAFC decided upon all the issues before it, direct subsidies were not among them. Korean Respondents state, "[T]he `program' appealed was an `indirect' subsidy accomplished through control of the entire Korean financial system." Id. at 12. To separate private loans from the program, Korean Respondents seem to suggest, would convert government loans into direct subsidies. Korean Respondents contend that because Commerce presented no evidence of direct subsidies to this Court or the Court of Appeals, the Court of Appeals had no reason to place significance upon a distinction between government and private sources of the loans. See id. at 12-13. Korean Respondents argue that Commerce may not now place significance upon the distinction. See id. at 13.

Second, Korean Respondents argue the CAFC did not affirm any aspect of this Court's holding in British Steel II regarding domestic loans. See id. at 13. Respondents claim the CAFC reversed this Court's judgment regarding domestic loans in whole and could not have separately affirmed a finding on government-sourced domestic loans because Commerce never made the distinction in the history of the case. See id. at 14-15. Respondents contend Commerce provided a new theory for the distinction by identifying...