Severstal v. United States

• Decision Date: 25 April 2017
• Docket Number: Slip Op. 17–50,Court No. 16–00172
• Parties: PAO SEVERSTAL and Severstal Export GmbH, Plaintiffs, v. UNITED STATES, Defendant, and ArcelorMittal USA LLC, AK Steel Corporation, Nucor Corporation, and United States Steel Corporation, Defendant–Intervenors.
• Court: U.S. Court of International Trade

219 F.Supp.3d 1411

PAO SEVERSTAL and Severstal Export GmbH, Plaintiffs,

v. UNITED STATES, Defendant,andArcelorMittal USA LLC, AK Steel Corporation, Nucor Corporation, and United States Steel Corporation, Defendant–Intervenors.

Slip Op. 17–50

Court No. 16–00172

United States Court of International Trade.

April 25, 2017

Daniel J. Cannistra and Benjamin Blase Caryl , Crowell & Moring LLP, of Washington, DC, argued for plaintiffs.

Renee A. Burbank , Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for defendant. With her on the brief were Benjamin C. Mizer , Principal Deputy Assistant Attorney General, Jeanne E. Davidson , Director, and Patricia M. McCarthy , Assistant Director. Of counsel on the brief was Michael T. Gagain , Attorney, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC. Of counsel, Lydia Pardini , Attorney, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC, argued for defendant.

Brooke Ringel , Kelly Drye & Warren, LLP, of Washington, DC, argued for defendant-intervenor.

OPINION

Katzmann, Judge:

If this case evokes a sense of déjà vu, it is because it presents from the same record the principal question posed and addressed in an opinion issued today by this court in ArcelorMittal v. United States , 41 CIT ––––, Op. ––––, (April 25, 2017) ("ArcelorMittal "): Does a foreign exporter and producer, having obtained a de minimis subsidy rate in an investigation by the U.S. Department of Commerce ("Commerce"), and not being subject to a countervailing duty ("CVD") order, nonetheless have standing to challenge Commerce's calculation of that subsidy rate. Put another way, where a party ultimately prevails at the administrative level in Commerce's investigation, must its challenge to that proceeding fail because there is no case or controversy and thus no jurisdiction lies?

This matter is before the court on defendant United States' Rule 12(b)(1) Motion to Dismiss for Lack of Jurisdiction plaintiffs PAO Severstal and Severstal Export GmbH's (collectively "Severstal") action. Def.'s Mot. Dismiss for Lack of Jurisdiction, Dec. 2, 2016, ECF No. 35 ("Def.'s Mot."); Pl.'s Compl., Sep. 26, 2016, ECF No. 10 ("Pl.'s Compl."). Severstal, a foreign exporter and producer of cold-rolled steel flat products from Russia, challenges certain factual findings and legal conclusions upon which Commerce's final determination in the CVD investigation of certain cold-rolled steel flat products from the Russian Federation is based. Countervailing Duty Investigation of Certain Cold–Rolled Steel Flat Products From the Russian Federation: Final Affirmative Countervailing Duty Determination and Final Negative Critical Circumstances Determination , 81 Fed. Reg. 49,935 (Dep't Commerce July 29, 2016) ("Final Determination ") and the accompanying July 20, 2016 Issues and Decision Memorandum, C–821–823. For the reasons set forth below, the court finds that it lacks subject matter jurisdiction to hear Severstal's claim and grants defendant's motion to dismiss without prejudice.

BACKGROUND

The court need not detail the factual and administrative background resulting in the Final Determination , as it is the same as that set forth in ArcelorMittal .¹

Severstal filed suit on August 26, 2016 and filed its complaint, containing four counts, one month later. Pl.'s Sum., ECF No. 1; Pl.'s Compl. Count four is essentially identical to the sole count in Severstal's cross-claim in 16–cv–00168; Severstal in both is challenging Commerce's determination to apply adverse facts available ("AFA") in calculating the benefit from the tax deduction for exploration expenses subsidy program. Pl.'s Compl. ¶¶ 44–48. In the other three counts, Severstal alleges and challenges, first, Commerce's use of the price of coal, rather than the price of coal mining rights, as the benchmark for its calculation of benefit under the provision of coal mining rights for less than adequate remuneration ("LTAR") program; second, Commerce's comparison of coal prices to a constructed coal price that does not include several costs Severstal allegedly incurred in obtaining and delivering coal to its steel factory, rather than a comparison of a constructed coal mining right price benchmark to Severstal's coal mining rights prices; and third, Commerce's alleged refusal to include most of Severstal's coal extraction-related costs in its construction of a Severstal coal price used to calculate the benefit for the provision of coal mining rights for LTAR program. Pl.'s Compl. ¶¶ 32–43.

The Government moved under Rule 12(b)(1) of this Court to dismiss Severstal's action for lack of jurisdiction. Def.'s Mot.; USCIT R. 12(b)(1). Severstal responded on January 9, 2017, and the Government replied on January 30. Pl.'s Opp'n., ECF No. 39 ("Pl.'s Opp'n"); Def.'s Reply, ECF No. 41 ("Def.'s Reply"). Defendant argues that Severstal, having obtained a de minimis subsidy rate in Commerce's investigation, and not being subject to any CVD order,² cannot show injury in fact,³ and thus lacks standing to file suit against the defendant. Def.'s Mot. at 2–6.

JURISDICTION AND STANDARD OF REVIEW

The party seeking to invoke the Court's jurisdiction carries the burden of establishing that subject matter jurisdiction lies. Nat'l Presto Indus., Inc. v. Dazey Corp. , 107 F.3d 1576, 1580 (Fed. Cir. 1997). This burden extends to each cause of action asserted. DaimlerChrysler Corp. v. United States , 442 F.3d 1313, 1318–19 (Fed. Cir. 2006) ; see Washington Red Raspberry Com. v. United States , 11 C.I.T. 173, 183–84, 657 F.Supp. 537, 545–46 (1987). "[W]hen a federal court concludes that it lacks subject-matter jurisdiction, the complaint must be dismissed in its entirety." Arbaugh v. Y & H Corp. , 546 U.S. 500, 502, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006), quoted in Nitek Elec., Inc. v. United States , 36 C.I.T. ––––, ––––, 844 F.Supp.2d 1298, 1302 (2012), aff'd , 806 F.3d 1376 (Fed. Cir. 2015).

In deciding a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction, the Court "accepts as true all uncontroverted factual allegations in the complaint," Engage Learning, Inc. v. Salazar , 660 F.3d 1346, 1355 (Fed. Cir. 2011), cited in Nitek , 844 F.Supp.2d at 1302, and draws all reasonable inferences in the plaintiff's favor. Carl v. U.S. Sec'y of Agric. , 36 C.I.T. ––––, ––––, 839 F.Supp.2d 1351, 1352 (2012) (citing Cedars–Sinai Med. Ctr. v. Watkins , 11 F.3d 1573, 1583–84 (Fed. Cir. 1993) ; Henke v. United States , 60 F.3d 795, 797 (Fed. Cir. 1995) ).

DISCUSSION

Severstal submits that the Court possesses jurisdiction to entertain this action pursuant to 28 U.S.C. § 1581(c). Pl.'s Compl. ¶ 2. Severstal also argues that it is an interested party within the meaning of 19 U.S.C. §§ 1677(9)(A) and 1516a(f)(3), having participated fully in the underlying countervailing duty investigation at issue, and thus has standing pursuant to 19 U.S.C. § 1516a(d) and 28 U.S.C. § 2636(c). Pl.'s Compl. ¶ 3. The Government takes issue not with Severstal's status as an interested party who participated fully in the underlying proceeding, but rather with Severstal's standing under the United States Constitution, specifically regarding the necessary presence of an injury in fact. Def.'s Mot. at 3–5; Def.'s Reply at 3–4.

The jurisdiction of Federal Courts is limited to "Cases" and "Controversies." U.S. Const. art. III, § 2, cl. 1. "A necessary component of establishing a case or controversy pursuant to Article III is standing." Royal Thai Gov't v. United States , 38 C.I.T. ––––, ––––, 978 F.Supp.2d 1330, 1333 (2014) (citing Lujan v. Defenders of Wildlife , 504 U.S. 555, 560, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) ("[T]he core component of standing is an essential and unchanging part of the case-or-controversy requirement of Article III.")). To establish standing, the plaintiff must show an "injury in fact" that is "concrete and particularized" as well as "actual or imminent, not conjectural or hypothetical." Royal Thai , 978 F.Supp.2d at 1333 (quoting Lujan , 504 U.S. at 560, 112 S.Ct. 2130 ). Additionally, the plaintiff must demonstrate that the injury is "fairly traceable to the challenged action" and that it is "likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision." Id. (quoting Lujan , 504 U.S. at 560–61, 112 S.Ct. 2130 ).

The U.S. Court of Appeals for the Federal Circuit and this Court have held that when a respondent challenges an administrative proceeding in which it has prevailed, there is no case or controversy, and thus no jurisdiction lies. Zhanjiang Guolian Aquatic Prod. Co. v. United States , 38 C.I.T. ––––, ––––, 991 F.Supp.2d 1339, 1342 (2014) (citing Royal Thai , 978 F.Supp.2d at 1333 ); see Rose Bearings Ltd. v. United States , 14 C.I.T. 801, 802–03, 751 F.Supp. 1545, 1546–47 (1990) ; see also Freeport Minerals Co. v. United States , 758 F.2d 629, 634 (Fed. Cir. 1985). Because Commerce assigned Severstal a de minimis subsidy rate, Severstal prevailed as a respondent in the underlying proceeding. A de minimis subsidy rate removes a respondent from payment obligations under a relevant CVD order. 19 U.S.C. § 1671d(a)(3) ("In making a determination under this subsection, [Commerce] shall disregard any countervailable subsidy rate that is de minimis ...."); see 19 U.S.C. § 1671b(b)(4) ; 19 C.F.R. § 351.204(e)(1) (2016) ("The Secretary will exclude from an ... order under [19 U.S.C. § 1671e ] ... any exporter or producer for which the Secretary determines an individual weighted-average dumping margin or individual net countervailable subsidy rate of zero or de minimis ."). Further, the ITC determined that imports of subsidized steel from Russia are negligible, resulting in the termination of the CVD investigation without the issuance of a CVD order. Supra n.2; see Royal Thai , 978 F.Supp.2d at 1333 ...