Nakornthai Strip Mill Public v. U.S.

• Citation: 587 F.Supp.2d 1303
• Decision Date: 24 November 2008
• Docket Number: Slip Op. 08-128. Court No. 07-00180.
• Parties: NAKORNTHAI STRIP MILL PUBLIC COMPANY LIMITED, Plaintiff, v. UNITED STATES, Defendant, United States Steel Corporation, Defendant-Intervenor.
• Court: U.S. Court of International Trade

Page 1303

587 F.Supp.2d 1303

NAKORNTHAI STRIP MILL PUBLIC COMPANY LIMITED, Plaintiff, v. UNITED STATES, Defendant United States Steel Corporation, Defendant-Intervenor.

Slip Op. 08-128. Court No. 07-00180.

United States Court of International Trade.

November 24, 2008.

Hughes, Hubbard & Reed LLP (Kenneth J. Pierce, Robert L. LaFrankie, Victor S. Mroczka) for the Plaintiff.

Gregory G. Katsas, Acting Assistant Attorney General; Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Jane C. Dempsey); Matthew D. Walden, Attorney, Of Counsel, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, for the United States Department of Commerce.

Skadden, Arps, Slate, Meagher & Flom LLP (Robert E. Lighthizer, John J. Mangan, Jeffrey Gerrish, Luke A. Meisner) for the Defendant-Intervenor.

OPINION

POGUE, Judge.

This is the court's second opinion in this matter reviewing whether Commerce's selection of the invoice date as the date of sale, for purposes of calculating an antidumping duty, was supported by the administrative record. Following the court's previous decision, Nakornthai Strip Mill Pub. Co. v. United States, 32 CIT ___ 558 F.Supp.2d 1319 (2008) (hereinafter "the court's May 28 opinion"), the Department of Commerce ("Commerce") reconsidered, on remand, its original determination, but again chose to use the date of invoice rather than the date of contract as the date of sale. Final Results of Redetermination Pursuant to Remand, Nakornthai Strip Mill Pub. Co., A-549-817, ADR 11/1/2004-10/31/2005 (July 28, 2008) ("Remand Results"). Plaintiff Nakornthai Strip Mill Public Company Limited ("Nakornthai")¹ now challenges Commerce's Remand Results, presenting the court with three grounds upon which it again seeks remand of the case.

After thorough review, the court finds that Commerce has once again failed to make a reasoned finding with respect to Nakornthai's specific evidence, and must therefore again remand this case.

Background

Nakornthai filed the instant action to challenge Commerce's final results of administrative review of the antidumping order on Nakornthai's imports. Certain Hot-Rolled Carbon Steel Flat Products from Thailand, 72 Fed.Reg. 27,802 (Dep't Commerce May 17, 2007) (final results and partial rescission of antidumping duty administrative review). As the review record revealed, the original contract between Nakornthai and its wholesaler specified, among other things, both an overall quantity tolerance and an individual, per item, tolerance level. Nakornthai, 558 F.Supp.2d at 1322. A subsequent amendment removed the line-item tolerance level from the contract, leading Commerce to conclude that this change demonstrated that the contract's material terms were not settled until the invoice date. Id. at 1328.² Nakornthai, however, presented evidence that the contract amendment affected less than 0.1% of the total quantity of goods sold and shipped under the contract, although the quantity shipped of the single, changed line-item was 14.5% more than the upper end of the original tolerance level and more than 25% above the specific line-item quantity for that product. Id.

In its May 28 opinion,³ the court affirmed Commerce's legal conclusion, holding that Commerce's identification of potentially "material terms of sale" of Nakornthai's contract was based on the agency's reasonable interpretation of its own regulation. Id. at 1327. However, the court held that Commerce's factual findings on the finality of the terms of sale were incomplete, and remanded the issue back to the agency for reconsideration. Id. at 1328-29. The court stated that "Commerce did not discuss or make a finding with regard to this [i.e., Nakornthai's] evidence, either on its own or when considered in light of the elimination of the tolerance levels in the contract." Id. at 1328. Therefore, the court could not determine whether the variation in quantities for one line-item was sufficient either to affect product mix in a significant way or to alter the dumping margin. Id. As such, the court remanded the case back to Commerce to make a factual finding "with regard to the significance of Nakornthai's evidence" and whether "the date the terms of the contract were essentially `established' [at the date of contract] in light of the evidence submitted." Id. at 1328-29.

Standard of Review

The court reviews remand determinations for compliance with the court's remand order. See NMB Sing. Ltd. v. United States, 28 CIT 1252, 1259-60, 341 F.Supp.2d 1327, 1333-34 (2004) (affirming International Trade Commission's determinations on remand where the determinations were in accordance with law, supported by substantial evidence, and otherwise satisfied the remand order); see also Olympia Indus., Inc. v. United States, 23 CIT 80, 82, 36 F.Supp.2d 414, 416 (1999) (affirming after "review[ing] Commerce's compliance with these instructions in its Remand Results" and finding the determination to be supported by substantial evidence and in accordance with law). In addition, any factual findings on remand must be supported by substantial evidence and the agency's legal determinations must be in accordance with law. 19 U.S.C. § 1516a (b)(1)(B); see, e.g., Huaiyin Foreign Trade Corp. v. United States, 322 F.3d 1369, 1374 (Fed.Cir.2003); AG der Dillinger Hüttenwerke v. United States, 28 CIT 94, 95, 310 F.Supp.2d 1347, 1349 (2004) (holding remand determination to legal and factual standards set out in 19 U.S.C. § 1516a (b)(1)(B)). "Substantial evidence is `such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.'" Huaiyin Foreign Trade Corp., 322 F.3d at 1374 (internal citations omitted).

Discussion

Nakornthai's Comments state its specific objections to Commerce's Remand Results. First, Nakornthai argues that Commerce did not adequately distinguish its Romanian Plate decision where similar facts lead to opposite results. Second, Nakornthai maintains that Commerce failed to make the evidentiary findings required by the court's May 28 opinion. Finally, Nakornthai contends that Commerce was required to consider its alternative date-ofsale arguments regarding the use of amended contract date and shipment date, as the court remand had replaced Nakornthai's prior failure to exhaust administrative remedies on this issue.

The court agrees that Commerce has again failed to make sufficient factual findings as required by the court's May 28 opinion, and thus must remand on this ground. However, the court rejects Nakornthai's other arguments. The court will discuss each issue in turn.

I. Commerce Adequately Distinguished Romanian Plate

In its Remand Results, Commerce reasonably distinguished the facts of this case from the facts in Certain Cut-to-Length Carbon Steel Plate from Romania, 72 Fed.Reg. 6,522 (Dep't Commerce Feb. 12 2007) (final admin. review). See Issues and Decision Memorandum for the Administrative Review of Certain Cut-to-Length Carbon Steel Plate from Romania: Final Results of Antidumping Duty Administrative Review and Final Partial Rescission, A-485-803, ADR 08/01/2004-07/31/2005 (Feb. 2, 2007), available at http://ia.ita. doc .gov/frn/summary/ROMANIA/E7-2216-1.pdf ("Romanian Plate"). Romanian Plate, although containing facts similar to this case and also applying 19 C.F.R. § 351.401(i)(2007), determined that a date earlier than that of the invoice was the proper "date of sale," where "one sale of a small quantity outside the specified quantity tolerance level" did not constitute a "material" change to the contract. Nakornthai, 558 F.Supp.2d at 1327-28 (citing Romanian Plate at 9). Despite that change, Commerce concluded that the Romanian Plate parties agreed to their contract's material terms at the time of order acknowledgment, a date prior to the invoice date, in part, because the parties intended to finalize the material terms of sale at the earlier time. Romanian Plate at 7, 9.

As evidence, Commerce cited the specific language of the order acknowledgment—language that Commerce deemed to definitively state "that there can thereafter be no changes in the terms of sale"— as well as affidavits from U.S. customers "declaring that the order acknowledgments are understood as the parties' final agreement on quantities and prices ordered." Id. at 7. Commerce also highlighted evidence that the parties "decided to fix the U.S. sales terms with the order acknowledgment to guarantee price stability," given that there are often long lag times "between order acknowledgment and invoice date." Id. at 8. Furthermore, Commerce emphasized that the contract "did not undergo any meaningful changes"; the record contained "no evidence of price changes between the order acknowledgments and their respective invoices" and, with the exception of "one sale of a small quantity," the invoiced quantities were all within the order acknowledgment's tolerance levels. Id. at 7. Hence, other than a "small" quantity change in one sale, the contracts terms remained the same. Id.

Nakornthai argues that "Commerce's attempt to distinguish Romania[n] Plate ... elevates form over substance" because, although Romanian Plate involved no formal contract amendment, "there were still changes to the contract" analogous to those in the case at bar. Pl.'s Comments at 6, 7. Nakornthai points out that its contract also involved long lag times between the order acknowledgment and invoice date, and that one of the sales in that case also involved a small change in quantity outside the specified tolerance level. Id. at 7. Because of the similarities to the evidence presented in its case, Nakornthai asserts, Commerce must find that the small change in quantity was "not significant" just as the agency concluded in Romanian Plate. Id. at 6.

Nakornthai is, in part, correct. "Agencies have a responsibility to administer their statutorily...