Prime Time Commerce LLC v. United States, Slip Op. 19-86

• Citation: 396 F.Supp.3d 1319
• Decision Date: 09 July 2019
• Docket Number: Court No. 18-00024,Slip Op. 19-86
• Parties: PRIME TIME COMMERCE LLC, Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

396 F.Supp.3d 1319

PRIME TIME COMMERCE LLC, Plaintiff,

v.UNITED STATES, Defendant.

Slip Op. 19-86

Court No. 18-00024

United States Court of International Trade.

July 9, 2019

Mark Burton Lehnardt and Lindita Valentina Ciko Torza, Baker & Hostetler, LLP, of Washington, DC, argued for plaintiff Prime Time Commerce LLC.

Ashley Akers, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. On the brief were Patricia M. McCarthy, Assistant Director, Jeanne E. Davidson, Director, and Joseph H. Hunt, Assistant Attorney General. Of Counsel on the brief was Brendan Scott Saslow, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

OPINION AND ORDER

Kelly, Judge:

This action is before the court on a motion for judgment on the agency record challenging various aspects of the U.S. Department of Commerce's ("Department" or "Commerce") final determination in the administrative review of the antidumping duty ("ADD") order covering certain cased pencils from the People's Republic of China ("PRC"), filed by Plaintiff, Prime Time Commerce, LLC ("Prime Time"). See [Prime Time's] Mot. [ ] J. Agency R., Sept. 18, 2018, ECF No. 20; see also Certain Cased Pencils From the [PRC], 83 Fed. Reg. 3,112 (Dep't Commerce Jan. 23, 2018) (final results of [ADD] admin. review; 2015–2016) ("Final Results") and accompanying Issues & Decision Mem.: Certain Cased Pencils from the [PRC]; 2015–2016, A-570-827, (Jan. 16, 2018), ECF No. 12-4 ("Final Decision Memo"); Certain Cased Pencils From the [PRC], 59 Fed. Reg. 66,909 (Dep't Commerce Dec. 28, 1994) ("ADD Order"). Prime Time commenced this action pursuant to section 516A(a)(2)(A)(i)(I) and 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(A)(i)(I) and 1516a(a)(2)(B)(iii) (2012).¹ See Summons, Feb. 8, 2018, ECF No. 1; Compl., Feb. 8, 2018, ECF No. 4. Prime Time is an importer of the subject merchandise.

Prime Time challenges as contrary to law and unsupported by substantial evidence Commerce's decisions (i) to reject and remove from the record Prime Time's response to a Sections C&D questionnaire issued to Ningbo Homey Union Co., Ltd. ("Homey"), offered as either a questionnaire response or as factual information not elsewhere defined, and the accompanying explanations,² see Mem. Supp. [Prime Time's] Rule 56.2 Mot. [ ] J. Agency R. at 18–31, Sept. 18, 2018, ECF No. 20-1 ("Prime Time's Br."), (ii) to assign the PRC-wide rate, the highest rate available, as Homey's dumping margin, without considering Prime Time's efforts to populate the record, and (iii) to assign Prime Time the PRC-wide rate, the highest available rate, instead of calculating an importer-specific assessment rate. Id. at 17–18, 31–35.

For the reasons that follow, the court sustains Commerce's decision that Prime Time's submission, offered as a questionnaire response pursuant to 19 C.F.R. § 351.301(c)(1) (2017),³ was an unsolicited questionnaire response. The court, however, concludes that Commerce acted contrary to law when it removed Prime Time's information, submitted as factual information not elsewhere defined under 19 C.F.R. § 351.301(c)(5), and the accompanying narrative of admissibility, from the record. The court further concludes that Commerce's decision not to accept Prime Time's submission as factual information not elsewhere defined is not supported by substantial evidence because Commerce removed from the record the very basis for that determination. On remand, Commerce must place Prime Time's narrative of admissibility and submission on the record. Further, on remand, Commerce must consider Prime Time's submission, as filed under 19 C.F.R. § 351.301(c)(5), in the context of calculating an importer-specific assessment rate for Prime Time's entries. If Commerce is unable to calculate an importer-specific assessment rate on the entries of subject merchandise exported by Homey and imported by Prime Time, Commerce must explain the basis for such a conclusion. If Commerce invokes its practice as a basis for not calculating such a rate, Commerce should explain why its practice is reasonable in light of 19 C.F.R. § 351.212(b).

BACKGROUND

Commerce initiated this administrative review covering the subject merchandise entered during the period of review, December 1, 2015, through November 30, 2016. See Initiation of Antidumping and Countervailing Duty Admin. Reviews, 82 Fed. Reg. 10,457, 10,459 (Dep't Commerce Feb. 13, 2017) ("Initiation Notice"). Of the six companies subject to the ADD Order, only Homey and Orient International Holding Shanghai Foreign Trade Co., Ltd. ("Orient"), entered subject merchandise during the period of review. Resp't Selection [Mem.] at 1, PD 23, bar code 3558523-01 (Mar. 30, 2017).⁴ Pertinent here, Homey is Prime Time's unaffiliated exporter. See Prime Time's Br. at 1; [Prelim.] Decision Mem. for [ ] Certain Cased Pencils from the [PRC] at 2, A-570-827, PD 63, bar code 3614317-01 (Aug. 31, 2017) ("Prelim. Decision Memo"). On March 15, 2017, Homey filed a separate rate application, and following Orient's withdrawal of its request for review, became the sole mandatory respondent. Prelim. Decision Memo at 2; see also [Orient's] Withdrawal Req. Review, PD 22, bar code 3553055-01 (Mar. 17, 2017). Homey, following submission of its separate rate application, stopped cooperating with Commerce's requests for information. See Prelim. Decision Memo at 2; Final Decision Memo at 5. Prime Time attempted to substitute its responses for Homey's and populate the record with factual information. Prime Time's Br. at 6–7. It also sought to suggest gap filling measures where it was unable to supply the information needed. Id.

Prime Time filed a Sections C&D Questionnaire response on behalf of Homey, contending it was admissible under 19 C.F.R. § 351.301(c)(1) or, in the alternative, 19 C.F.R. § 351.301(c)(5). Rejection Letter at 1. Prime Time explained that its submission consisted of new factual information as per 19 C.F.R. § 351.102(b)(21)(i). Id. Commerce declined to accept the submission under either 19 C.F.R. § 351.301(c)(1) or (c)(5) and removed it, along with the accompanying explanations, from the record. [Commerce's] Rejection of Unsolicited New Factual Info. Mem., PD 38, bar code 3580223-01 (June 9, 2017) ("Rejection Letter"). Commerce similarly denied Prime Time's August 3, 2017, request for reconsideration. See [Prime Time's Req. Reconsideration], PD 60, bar code 3604262-01 (Aug. 3, 2017) ("Reconsideration Req."); Prelim. Decision Memo at 3 n.16.

To the extent that Prime Time's submission sought to satisfy 19 C.F.R. § 351.301(c)(1) by presenting factual information responsive to a questionnaire Commerce sent to Homey, Commerce explained that it rejected the submission as an unsolicited questionnaire response in accordance with 19 C.F.R. § 351.302(d). Rejection Letter at 1. To the extent that Prime Time's submission purported to contain factual information not elsewhere defined per 19 C.F.R. § 351.301(c)(5), Commerce rejected it based on the insufficiency of Prime Time's accompanying narrative of admissibility.⁵ Id. at 2. Specifically, Commerce explained that increased financial hardship for the importer, arising out of an exporter's and/or producer's failure to cooperate, is a known liability and not grounds for considering the proffered information.⁶ Id. Further, Commerce explained that it is not its practice to calculate an importer-specific assessment rate unless a margin is calculated for each individually examined exporter. Id. Commerce does not state that it is unable to calculate an importer-specific assessment rate given the factual circumstances in this case. Id. It likewise does not explain why its practice is reasonable in light of 19 C.F.R. § 351.212(b)'s directive to calculate importer-specific assessment rates whenever Commerce conducts a review of an antidumping duty order. Id. Commerce also explained that Prime Time's submission did not meet the requirements of 19 U.S.C. § 1677m(e)⁷ to qualify as information that is "necessary to the determination" and which Commerce must consider. Rejection Letter at 2. Commerce explained that the submission was so incomplete as to not be reliable and could not be used without undue difficulty. Id.; see also 19 U.S.C. § 1677m(e)(3), (5). Commerce rejected and removed all filings associated with Prime Time's submission from the record. See Rejection of Unsolicited Info., PD 39, bar code 3582419-01 (June 9, 2017); [Notice Doc. Rejected & Removed], PD 32, bar code 3570939-01 (May 10, 2017).

In its preliminary determination, Commerce applied the PRC-wide rate of 114.90% rate to all of Homey's entries. See generally Certain Cased Pencils From the [PRC], 82 Fed. Reg. 43,329 (Dep't Commerce Sept. 15, 2017) (preliminary results of [ADD] admin. review, prelim. determination of no shipments, & rescission of review in part; 2015–2016) and accompanying Prelim. Decision Memo at 6. It explained that Homey, as both a separate rate applicant and a mandatory respondent, had to satisfy dual obligations—submit a separate rate application and answer all questionnaires required of it as a mandatory respondent—or become ineligible for separate rate status. Prelim. Decision Memo at 5 (citing Initiation Notice, 82 Fed. Reg. at 10,458 (laying out the dual obligations)). Further, Commerce continued to find that Prime Time's submission constituted unsolicited new factual information and that the request for reconsideration did not offer new grounds for reconsideration. Prelim Decision Memo at 3 & n.16; see also Reconsideration Req. at 1–2. In its case brief to the agency, Prime Time continued to challenge Commerce's decision to reject and remove the submission and argue that Commerce should calculate an importer-specific assessment rate for Prime Time. [Prime Time's Agency] Case Br. at 3–9, PD 69, bar code...