Parkdale Intern. v. U.S.

• Decision Date: 17 April 2006
• Docket Number: Slip Op. 06-54. Court No. 05-00316.
• Citation: 429 F.Supp.2d 1324
• Parties: PARKDALE INTERNATIONAL, Plaintiff, and Russel Metals Export, Plaintiff-Intervenor, v. UNITED STATES, Defendant, and United States Steel Corp., Defendant-Intervenor.
• Court: U.S. Court of International Trade

Page 1324

429 F.Supp.2d 1324

PARKDALE INTERNATIONAL, Plaintiff, and Russel Metals Export, Plaintiff-Intervenor, v. UNITED STATES, Defendant, and United States Steel Corp., Defendant-Intervenor.

Slip Op. 06-54. Court No. 05-00316.

United States Court of International Trade.

April 17, 2006.

Hunton & Williams LLP (William Silverman), Richard P. Ferrin, for the plaintiff.

Sharretts, Paley, Carter & Blauvelt, P.C. (Peter Jay Baskin, Beatrice A. Brickell), for the plaintiff-intervenor.

Peter D. Keisler, Assistant Attorney General; David Cohen, Director; (Jeanne E. Davidson), Deputy Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, (David S. Silverbrand); Kemba Eneas, International Trade Administration, Department of Commerce, of counsel, for the defendant.

Skadden Arps Slate Meagher & Flom LLP (John J. Mangan), Robert E. Lighthizer, Jeffrey D. Gerrish, Stephen F. Munroe, for the defendant-intervenor.

OPINION

BARZILAY, Judge.

Plaintiff, Parkdale International, a reseller, exporter and importer of corrosion-resistant carbon steel products ("CORE") from Canada to the United States, moves for judgment on the agency record pursuant to USCIT Rule 56.2, seeking review of the final results in Certain Corrosion-Resistant Carbon Steel Flat Products from Canada, 70 Fed.Reg. 13,458 (Dep't Comm., Mar. 21, 2005) (hereinafter "Final Results"), as amended by 70 Fed.Reg. 22,846 (Dep't Comm., May 3, 2005). Specifically, Plaintiff and Plaintiff-Intervenor, Russel Metals Export ("Russel"), a Canadian reseller of CORE, challenge the Department of Commerce's instructions to the Bureau of Customs and Border Protection ("Customs"), based on Commerce's new unreviewed reseller policy rule published on May 6, 2003, to liquidate, at the "all-others" rate, entries of subject merchandise entered prior to May 6, 2003. The court exercises jurisdiction over this case pursuant to 28 U.S.C. § 1581(c) to review Commerce's antidumping determination made under 19 U.S.C. § 1516a(b)(1) and 19 U.S.C. § 1675.

I. BACKGROUND

Commerce first published its antidumping duty order on CORE from Canada on August 19, 1993. Antidumping Duty Orders: Certain Corrosion-Resistant Carbon Steel Flat Products from Canada, 58 Fed. Reg. 44,162 (Dep't Comm., Aug. 19, 1993). On October 15, 1998, Commerce published a notice in the Federal Register announcing that it intended to clarify its regulation 19 C.F.R. § 351.212¹ regarding the automatic liquidation of entries subject to an antidumping duty order where a reseller exports subject merchandise to the United States. See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 63 Fed.Reg. 55,361 (Dep't Comm., Oct. 15, 1998) (notice and request for comment). On March 25, 2002, Commerce asked for additional comments on the October 15, 1998 proposal. See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties; Additional Comment Period, 67 Fed.Reg. 13,599 (Dep't Comm., Mar. 25, 2002). Parkdale submitted comments on April 1, 2002 and Russel supported Parkdale's views. See Issues and Decision Memorandum for the Final Results of the Administrative Review of the Antidumping Duty Order on Certain Corrosion-Resistant Carbon Steel Flat Products from Canada, at 10 (Mar. 14, 2005), P.R. 154 (hereinafter "Issues and Decision Mem."). After receiving and reviewing comments, Commerce published a notice officially implementing its unreviewed-reseller procedure on May 6, 2003. Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 Fed.Reg. 23,954 (Dep't Comm., May 6, 2003) ("Reseller Policy"). The Reseller Policy, characterized by Commerce as a "clarification" of the duty assessment procedure for unreviewed resellers, states:

[A]utomatic liquidation at the cash-deposit rate required at the time of entry can only apply to a reseller which does not have its own rate if no administrative review has been requested, either of the reseller or of any producer of merchandise the reseller exported to the United States. If the Department conducts a review of a producer of the reseller's merchandise where entries of the merchandise were suspended at the producer's rate, automatic liquidation will not apply to the reseller's sales. If, in the course of an administrative review, the Department determines that the producer knew, or should have known, that the merchandise it sold to the reseller was destined for the United States, the reseller's merchandise will be liquidated at the producer's assessment rate which the Department calculates for the producer in the review. If, on the other hand, the Department determines in the administrative review that the producer did not know that the merchandise it sold to the reseller was destined for the United States, the reseller's merchandise will not be liquidated at the assessment rate the Department determines for the producer or automatically at the rate required as a deposit at the time of entry. In that situation, the entries of merchandise from the reseller during the period of review will be liquidated at the all-others rate if there was no company-specific review of the reseller for that review period.

68 Fed.Reg. 23,954. The new policy applies to entries "for which the anniversary month for requesting an administrative review" is May 2003 or later. Id. at 23,956.

For the period of review at issue, August 1, 2002, through July 31, 2003, Commerce published, on August 1, 2003, a notice of opportunity to request an administrative review of antidumping and countervailing duty orders, including the antidumping duty order on CORE from Canada. Antidumping or Countervailing Duty Order, Finding, or Suspended Liquidation; Opportunity to Request Administrative Review, 68 Fed.Reg. 45,218 (Dep't Comm., Aug. 1, 2003) (stating that interested parties would have opportunity during August 2003 to request administrative review of antidumping duty order on CORE from Canada). Parkdale did not request such a review.

On September 13, 2004, Commerce published the preliminary results of its administrative review of CORE products from Canada for the period August 1, 2002, through July 31, 2003. Certain Corrosion-Resistant Carbon Steel Flat Products from Canada: Preliminary Results of Antidumping Duty and Administrative Review, 69 Fed.Reg. 55,138 (Dep't Comm., Sept. 13, 2004) ("Preliminary Results"). In this notice, Commerce stated that the Reseller Policy "will apply to entries of subject merchandise during the period of review produced by companies included in these final results of review for which the reviewed companies did not know their merchandise was destined for the United States" and that accordingly, Commerce would instruct Customs "to liquidate unreviewed entries at the `all-others' rate if there is no rate for the intermediate company(ies) involved in the transaction." Id. at 55,142. Commerce issued draft liquidation instructions for entries of CORE from Canada reflecting this intention. P.R.² 140.

Parkdale responded to this administrative review, arguing that liquidation of its entries entered prior to May 6, 2003, at the "all-others" rate would constitute an unlawful retroactive application of the Reseller Policy and that Commerce should instead apply the cash deposit or bonding rate as it had prior to the new rule. P.R. 140. Commerce declined to adopt Parkdale's arguments and published Final Results on March 21, 2005. Final Results, 70 Fed.Reg., 13,458. Prior to this determination, Parkdale's CORE imports had been subject to a cash deposit rate of 4.24 percent. The applicable "all-others" rate for Parkdale's entries was 18.71 percent. Issues and Decision Mem. at 8.

Unlike Parkdale, Russel initially requested a review of its exports of subject merchandise. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, Request for Revocation in Part and Deferral of Administrative Review, 68 Fed.Reg. 56,262 (Sept. 30, 2003). On November 7, 2003, Commerce sent an antidumping duty questionnaire to Russel. Def.'s Resp. 5. On September 9, 2003, Russel, along with several other Canadian resellers that requested administrative review, discussed with Commerce the application of the Reseller Policy. See Mem. Sept. 9, 2003 Meeting with Canadian Industry and Government Representatives, P.R. 13. The Canadian resellers informed Commerce that they would be unable to provide the Cost of Production/Constructed Value (COP) information normally requested in Section D of the standard antidumping questionnaire. See Letter from Russel to Commerce, P.R. at 39. Russel advised Commerce that the starting point for providing cost information in the questionnaire response must be the acquisition price from the Canadian producer of the steel. Letter from Russel to Commerce, P.R. at 39. Subsequently, Russel submitted a letter dated November 21, 2003, to Commerce asking that it be allowed to calculate production costs based on its acquisition costs instead of mill production costs. See Letter from Russel to Commerce, P.R. 39. In that letter, Russel stated that it "reasonably believes that the DOC [Department of Commerce] will conclude that its vendors did not know that the subject merchandise sold to Russel was destined to the U.S. at the time of sale." Letter from Russel to Commerce, P.R. 39. Russel also asked for an extension from the original due date of December 23, 2003 for submitting its responses to the questionnaire. Letter from Russel to Commerce, P.R. 39. However, on December 24, 2003, Russel withdrew its request for an administrative review. Prior to receiving Russel's withdrawal, on December 29, 2003, Commerce sent a reply to Russel's letter dated November 21, 2003, granting Russel an extension until January 12, 2004, and advising that Russel should respond to the questionnaire to the best of its ability. Letter from Commerce to Russel, P.R. 48. Commerce contacted Russel after receiving...