Rhone Poulenc, Inc. v. U.S.

Decision Date27 March 1990
Docket NumberNos. 89-1395,89-1402,s. 89-1395
PartiesRHONE POULENC, INC. and Rhone Poulenc Chimie De Base, S.A., Plaintiffs-Appellants, v. The UNITED STATES, Defendant-Appellee, PQ Corporation, Defendant-Appellee.
CourtU.S. Court of Appeals — Federal Circuit

James A. Geraghty, Donohue & Donohue, New York City, argued for plaintiffs-appellants.

M. Martha Ries, Atty., Commercial Litigation Branch, Dept. of Justice, Washington, D.C., argued for defendant-appellee. With her on the brief were Stuart E. Schiffer, Acting Asst. Atty. Gen. and David M. Cohen, Director. Also on the brief were Stephen J. Powell, Chief Counsel for Import Admin. and Pamela A. Green, Atty. Advisor, Office of the Chief Counsel for Import Admin., Dept. of Commerce, Washington, D.C., of counsel. Steven R. Sosnov, Sosnov & Associates, Norristown, Pa., argued for defendant-appellee.

Before RICH, NEWMAN and MICHEL, Circuit Judges.

RICH, Circuit Judge.

These consolidated appeals are from final judgments of the Court of International Trade, dismissing actions brought by importers of anhydrous sodium metasilicate (ASM) from France. 1 The importers challenged the final determinations of the Department of Commerce, International Trade Administration (ITA), in the 1984 and 1985 administrative reviews of the antidumping duty order covering French ASM. We affirm.


Appellants Rhone Poulenc Chimie de Base, S.A. and Rhone Poulenc, Inc. (collectively Rhone Poulenc) are the sole French producer and importer of ASM, a sodium silicate compound used in detergents, waste paper de-inking, and clay processing. In 1981, the ITA found that French ASM was being sold in the United States at a less-than-fair-value (LTFV) sales margin of 60 percent, and the United States International Trade Commission found material injury to the domestic industry by reason of the imports. Accordingly, the ITA issued an antidumping duty order covering French ASM. Anhydrous Sodium Metasilicate During the first and second administrative reviews of the antidumping order (covering November, 1980 through December, 1981), the ITA determined that there had been no imports of ASM from France. 47 Fed.Reg. 15620 (1982); 47 Fed.Reg. 44594 (1982). During this period, Rhone Poulenc requested a reduction of the 60 percent cash deposit rate determined in the original investigation, claiming that economic conditions had changed. The ITA concluded that it was without power to adjust the margin without an importation during the period of review, and suggested that making an actual importation was the proper way to establish that conditions had changed. See PQ Corp v. United States, 652 F.Supp. 724, 727 (CIT 1987).

From France; Antidumping Duty Order, 46 Fed.Reg. 1667 (1981). The order required the United States Customs Service (Customs) to collect cash deposits of estimated antidumping duties in the amount of 60 percent ad valorem.

Accordingly, Rhone Poulenc imported a single shipment of ASM during the following review period (1982). In the administrative review covering 1982 entries, the ITA determined that the sale was bona fide and at fair value. It ordered liquidation of the entry without any antidumping duty, and reduced the cash deposit rate to zero percent until publication of the final results of its next administrative review. 49 Fed.Reg. 43733 (1984). 3

In 1983, as in 1982, Rhone Poulenc made one ASM sale to the United States. In its administrative review covering 1983, the ITA determined that this sale was also at fair value. 53 Fed.Reg. 4195 (1988). 4

In 1984 and 1985, Rhone Poulenc made numerous imports of ASM into the United States. Pursuant to requests by PQ Corporation, a domestic producer of ASM, the ITA initiated its fifth and sixth administrative reviews of the antidumping duty order, covering 1984 and 1985 entries respectively. As before, the ITA sent Rhone Poulenc its standard antidumping duty questionnaires, requesting information on Rhone Poulenc's business organization and home market and United States sales.

To make a long story short, the present dispute was precipitated by Rhone Poulenc's responses to the ITA's 1984 and 1985 questionnaires. The ITA found the responses inadequate because they were submitted on paper rather than computer tape, and because sales dates, freight costs, and sales expenses were not stated in sufficient detail. 52 Fed.Reg. 28582 (1987) (1984 review); 52 Fed.Reg. 9320 (1987) (1985 review). In its preliminary results of the 1984 and 1985 administrative reviews, the ITA rejected Rhone Poulenc's questionnaire responses in their entirety, and stated that it was relying upon the "best information otherwise available" 5 to compute Rhone Poulenc's dumping margin, if any. As "best information" of Rhone Poulenc's current margins (1984 and 1985), the ITA stated its intention to revert to the 60 percent margin from the original LTFV investigation, which had been determined on the basis of sales made in 1980. Id.; 45 Fed.Reg. 77498 (1980). It then invited comments from interested parties.

Rhone Poulenc vigorously defended its questionnaire responses, insisting that they contained enough data to enable the ITA to ascertain every element necessary for a LTFV calculation, and were no less specific than those the ITA had accepted in the original LTFV investigation and earlier administrative reviews. It asserted that even if the responses were not 100% compliant, the ITA could not totally ignore them and The ITA responded as follows:

resort to stale margins from the original LTFV investigation. Finally, it contended that the zero percent margins from the more recent administrative reviews were the "best information" of Rhone Poulenc's current margin. 53 Fed.Reg. 4195 (1988) (1984 review); 52 Fed.Reg. 33856 (1987) (1985 review).

Comment 2: Rhone Poulenc maintains that for any portions of its response which were deficient the Department should use data from the most recently completed administrative review covering 1982, or its submission for the 1983 period. In addition, it contends that under the Freeport rule, the Department must use the most recent information available in an antidumping proceeding. Therefore, if the Department determines that the 1985 response is inadequate, for this review it must use information from the 1982 or 1983 responses.

Department's Position: The Department is properly using the margin from the [original] fair value investigation for this review as best information available due to our inability to get adequate cooperation from the respondent in submitting information. In conducting our reviews, we are dependent upon the cooperation of the respondent in supplying information for our analysis. Section 776 of the Tariff Act, which authorizes our use of the best information available in certain situations, is intended to encourage cooperation from parties in a proceeding. To use information from the previous two reviews, as respondent suggests, would, in effect, reward the respondent for his failure to provide adequate and timely responses during this review.

Respondent's reliance upon Freeport Minerals v. United States, 776 F.2d 1029 (CAFC 1985), is misplaced. That case simply held that the Department must look at up-to-date information in deciding whether to revoke an antidumping duty order. The Freeport case is irrelevant to the issue here, which is what data should be used as best information available where a respondent has not provided adequate information. In such cases we are authorized to use information that may be adverse to the interests of a respondent.

52 Fed.Reg. at 33856. 6 The ITA ordered Customs to liquidate Rhone Poulenc's 1984 and 1985 entries with the 60 percent ad valorem antidumping duty. Id.

The CIT Decisions

Rhone Poulenc unsuccessfully challenged the ITA's 1984 administrative review in the Court of International Trade (CIT). Rhone Poulenc, Inc. v. United States, 710 F.Supp. 341 (CIT 1989) (Rhone I ). The CIT found that Rhone Poulenc's responses to the questionnaires had been deficient and that the ITA had properly relied upon the "best information" rule. The court rejected Rhone Poulenc's argument that our decision in Freeport Minerals Co. v. United States, 776 F.2d 1029 (Fed.Cir.1985) required use of the most recent information, i.e., that from the 1982 and 1983 reviews, and held that, in any event, data from those reviews was unrepresentative because it was based upon so few sales. The court also rejected Rhone Poulenc's argument that the ITA could not automatically resort to the highest prior margin merely to penalize Rhone Poulenc for its deficient responses. Id. at 347. Finally, the CIT rejected Rhone Poulenc's argument that the ITA should have updated the 60 percent dumping margin to account for fluctuations in the interest rate and exchange rate of the French franc since 1980. The CIT rejected this argument because Rhone Poulenc had failed to raise it before the ITA. Id. at 348.

Rhone Poulenc also challenged the ITA's 1985 administrative review in the Court of International Trade, making basically the same arguments as it did in its challenge to the 1984 review. Rhone Poulenc, Inc. v. United States, 710 F.Supp. 348 (CIT 1989) Rhone Poulenc appeals each of these decisions. Because of the interrelationship between the cases, the appeals have been consolidated.

                (Rhone II ).    The CIT reached the same decision as it did in Rhone Poulenc's first action, applying the same reasoning and relying in part upon its prior opinion

Rhone Poulenc no longer challenges the ITA's total rejection of its questionnaire responses for the 1984 and 1985 reviews. It raises a single issue for our review--whether the CIT erred as a matter of law in upholding the 60 percent margin from the original LTFV investigation as the "best information" of Rhone Poulenc's 1984 and 1985 ...

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