Shandong Yongtai Grp. Co. v. United States, Slip Op. 19-150
| Decision Date | 27 November 2019 |
| Docket Number | Consol. Court No. 18-00077,Slip Op. 19-150 |
| Parties | SHANDONG YONGTAI GROUP CO., Ltd., Plaintiff, and Qingdao Sentury Tire Co., Ltd., Sentury Tire USA Inc., Sentury (Hong Kong) Trading Co., Limited, Pirelli Tyre Co., Ltd., Pirelli Tyre S.P.A., and Pirelli Tire LLC, Consolidated Plaintiffs, v. UNITED STATES, Defendant. |
| Court | U.S. Court of International Trade |
Jordan C. Kahn, Grunfeld Desiderio Lebowitz Silverman & Klestadt, LLP, of Washington, D.C., argued for Plaintiff Shandong Yongtai Group Co., Ltd. With him on the briefs were Ned H. Marshak, New York, and Brandon M. Petelin.
Dharmendra N. Choudhary, Grunfeld Desiderio Lebowitz Silverman & Klestadt, LLP, of New York, N.Y., argued for Consolidated Plaintiffs Qingdao Sentury Tire Co., Ltd., Sentury Tire USA Inc., and Sentury (Hong Kong) Trading Co., Limited. With him on the briefs were Andrew T. Schutz, Washington, Brandon M. Petelin, Jordan C. Kahn, and Ned H. Marshak. Elaine F. Wong also appeared.
Daniel L. Porter and James P. Durling, Curtis, Mallet-Prevost, Colt & Mosle LLP, of Washington, D.C., argued for Consolidated Plaintiffs Pirelli Tyre Co., Ltd., Pirelli Tyre S.p.A., and Pirelli Tire LLC. With them on the briefs were Tung A. Nguyen, Kimberly Reynolds, and Gina Colarusso.
Ashley Akers, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, D.C., argued for Defendant United States. With her on the briefs were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel was Ayat Mujais, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce. Of counsel on the briefs were David Campbell and Jessica R. DiPietro, Attorney-Advisor, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce.
This action arises from the U.S. Department of Commerce's ("Commerce") administrative review of certain passenger vehicle and light truck tires ("PVLT") from the People's Republic of China ("China" or "PRC"). Certain Passenger Vehicle and Light Truck Tires From the People's Republic of China, 83 Fed. Reg. 11,690 (Dep't Commerce Mar. 16, 2018) (final results of antidumping duty administrative review and final determination of no shipments) ("Final Results"); see Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China: Issues and Decision Memorandum for the Final Results of the 2015–2016 Antidumping Duty Administrative Review, PD 502 (Mar. 9, 2018) ("Final IDM"). Before the court are the motions for judgment on the agency record of Plaintiff Shandong Yongtai Group Co., Ltd. ("Plaintiff," "Shandong Yongtai," or "Shandong Yongtai Group"), Consolidated Plaintiffs Qingdao Sentury Tire Co., Ltd., Sentury Tire USA Inc., Sentury (Hong Kong) Trading Co., Limited (collectively, "Sentury"), and Consolidated Plaintiffs Pirelli Tyre Co., Ltd., Pirelli Tyre S.p.A., Pirelli Tire LLC (collectively, "Pirelli"). For the reasons that follow, the court sustains in part and remands in part the Final Results to Commerce for further consideration.
This case presents the following issues:
1. Whether Commerce's notice and initiation of the administrative review as to Plaintiff was in accordance with the law;
2. Whether Commerce's determination not to grant a separate rate as to Shandong Yongtai Chemical Co., Ltd. was supported by substantial evidence;
3. Whether Commerce's calculation of a value-added tax ("VAT") deduction to Sentury's U.S. price was supported by substantial evidence and in accordance with the law;
4. Whether Commerce's decision not to make an adjustment for the Export Buyer's Credit Program ("EBCP"), as accounted for in the companion countervailing duty administrative review, was supported by substantial evidence and in accordance with the law; and
5. Whether Commerce's determination that Pirelli was ineligible for a separate rate and Commerce's assignment of the China-wide entity rate was supported by substantial evidence and in accordance with the law.
Commerce published the Final Results of the administrative review of PVLT from China on March 16, 2018. Final Results at 11,690. Plaintiff initiated this action on April 12, 2018, challenging certain aspects of Commerce's Final Results. See Summons, Apr. 12, 2018, ECF No. 1; Compl. ¶ 1, Apr. 12, 2018, ECF No. 6 ("Compl."). The court entered a statutory injunction on April 16, 2018. See Order for Statutory Inj. Upon Consent, Apr. 16, 2018, ECF No. 10. The administrative record was filed on May 29, 2018. Ltr. from David W. Campbell, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, to Mario Toscano, Clerk of the Court, U.S. Court of International Trade, May 29, 2018, ECF No. 15. The court consolidated this case with Court Numbers 18-00079 and 18-00080 on June 14, 2018. Order, Jun. 14, 2018, ECF No. 17.
Shandong Yongtai, Sentury, and Pirelli moved for judgment on the agency record. Plaintiff's Mot. for J. on the Agency R., Oct. 2, 2018, ECF No. 20 ("Shandong Yongtai's Mot."); Consol. Pl. Sentury's Mot. for J. on the Agency R. Pursuant to Rule 56.2, Oct. 2, 2018, ECF No. 21 ("Sentury's Mot."); Mot. for J. on the Agency R., Oct. 3, 2019, ECF No. 24 ("Pirelli's Mot.").
The court stayed this case following the lapse in appropriations for the Department of Justice on January 8, 2019. Order, Jan. 8, 2019, ECF No. 32. Defendant moved to continue the stay following restoration of appropriations on January 30, 2019. Status Report and Request for Continuation of Stay, Jan. 30, 2019, ECF No. 33. The court denied Defendant's motion and lifted the stay on January 30, 2019. Second Am. Scheduling Order, Jan. 30, 2019, ECF No. 34.
Defendant responded. Def.'s Mem. in Opp'n to Pls.' Rule 56.2 Mots. for J. Upon the Agency R., Mar. 4, 2019, ECF No. 37 ("Def.'s Resp."). Shandong Yongtai, Sentury, and Pirelli replied. Reply Br. of Pl. Shandong Yongtai Group Co., Ltd. (Formerly Known as Shandong Yongtai Chemical Co., Ltd.), Apr. 19, 2019, ECF No. 44 ("Pl.'s Reply"); Reply Br. of Consol. Pl. Sentury, Apr. 19, 2019, ECF No. 45 ("Sentury's Reply"); Reply Br. of Consol. Pls. Pirelli Tyre Co., Ltd., Pirelli Tyre S.p.A., and Pirelli Tire LLC, Apr. 19, 2019, ECF No. 46 ("Pirelli's Reply"). The joint appendix was filed on May 3, 2019. Joint App'x to Opening Resp., and Reply Brs. Regarding Pls.' Mot. for J. on the Agency R. Pursuant to Rule 56.2, May 3, 2019, ECF No. 48. Sentury filed notices of supplemental authority on May 17, 2019, and May 24, 2019. Notice of Supplemental Authority, May 17, 2019, ECF No. 53; Notice of Supplemental Authority, May 24, 2019, ECF No. 54. The court heard oral arguments on June 18, 2019. Oral Argument Hr'g, Jun. 18, 2019, ECF No. 61.
The court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (2012) and 19 U.S.C. §§ 1516a(a)(2)(A)(i)(I) and (B)(iii). The court will hold unlawful any determination, finding, or conclusion found to be unsupported by substantial evidence on the record, or otherwise not in accordance with the law. 19 U.S.C. § 1516a(b)(1)(B)(i).
Plaintiff was formed under the name Shandong Yongtai Chemical Group Co., Ltd. ("Shandong Yongtai Chemical Group") in August, 1995. Shandong Yongtai Mot. 5; Shandong Yongtai Separate Rate Appl., Ex. 7, Art. 1, PD 149 (Nov. 14, 2016) ("Shandong Yongtai SRA"). Plaintiff changed the company's name to Shandong Yongtai Chemical Co., Ltd. ("Shandong Yongtai Chemical") in 2012.
Commerce initiated antidumping and countervailing duty investigations into PVLT from China on July 21, 2014. Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China, 79 Fed. Reg. 42,292 (Dep't Commerce July 21, 2014) (initiation of antidumping duty investigation); Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China, 79 Fed. Reg. 42,285 (Dep't Commerce July 21, 2014) (initiation of countervailing duty investigation). Plaintiff participated in the investigation and sought a separate rate. See Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China, 80 Fed. Reg. 4,250, 4,251 –52 (preliminary determination). Commerce issued an antidumping duty order as to PVLT from China on August 10, 2015. See Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China, 80 Fed. Reg. 47,902 (Dep't Commerce Aug. 10, 2015) ("AD Order"). Commerce assigned Plaintiff, identified as Shandong Yongtai Chemical, a separate rate in the AD Order. Id. at 47,905–47,906.
After Commerce issued the AD Order, Plaintiff changed its name to Shandong Yongtai Group Co., Ltd. ("Shandong Yongtai Group") via an amendment to the company's Articles of Association ("AOA"). Shandong Yongtai SRA, Exs. 3–7; see also Pl.'s Br. 6. The name change became effective on January 20, 2015 when the new business license was issued. Shandong Yongtai SRA, Exs. 3 & 7. Shandong Yongtai Group and Shandong Yongtai Chemical shared the same business license registration number. See id. 1
Commerce published the notice to request an administrative review on August 5, 2016. Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 81 Fed. Reg. 51,850 (Dep't Commerce Aug. 5, 2016). Shandong Yongtai, identified as "Shandong Yongtai Group Co., Ltd. (formerly Shandong Yongtai Chemical Co., Ltd.)," filed a request for administrative review. Ltr. from Gaopeng & Partners to Commerce at 1, PD 10 (Aug. 22, 2016) ("Pl. Request for Administrative Review") (emphasis omitted); see also Ltr. from Stewart and Stewart to Commerce, Attach. 1 at 7, PD 24 (Aug. 31, 2016).
Commerce published the initiation notice for antidumping and countervailing duty administrative...
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