Technologies v. United States

• Decision Date: 01 September 2017
• Docket Number: Slip Op. 17-419 Court No. 16-00183.
• Citation: 256 F.Supp.3d 1338
• Parties: AGILENT TECHNOLOGIES, Plaintiff, v. UNITED STATES, Defendant, and Aluminum Extrusions Fair Trade Committee, Defendant–Intervenor.
• Court: U.S. Court of International Trade

256 F.Supp.3d 1338

AGILENT TECHNOLOGIES, Plaintiff,

v.UNITED STATES, Defendant,andAluminum Extrusions Fair Trade Committee, Defendant–Intervenor.

Slip Op. 17-419 Court No. 16-00183.

United States Court of International Trade.

September 1, 2017

George R. Tuttle, III, Law Offices of George R. Tuttle, A.P.C., of Larkspur, CA, for Plaintiff Agilent Technologies, Inc.

Aimee Lee, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of New York, N.Y., for Defendant United States. With her on the brief were Chad A. Readler, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel on the brief was Jessica Rose DiPietro, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, D.C.

Alan H. Price and Robert E. DeFrancesco, III, Wiley Rein, LLP, of Washington, D.C., for Defendant–Intervenor Aluminum Extrusions Fair Trade Committee.

OPINION AND ORDER

Choe–Groves, Judge:

Plaintiff Agilent Technologies, Inc. ("Agilent" or "Plaintiff") is a manufacturer of electronic and bio-analytical measurement instruments who brought this action challenging the scope ruling on Agilent's mass filter radiator ("MFR") issued by the U.S. Department of Commerce ("Department" or "Commerce"). See Summons, Sept. 14, 2016, ECF No. 1; Compl., Oct. 5, 2016, ECF No. 8. Commerce determined that the MFR is covered by the scope of the antidumping and countervailing duty orders on aluminum extrusions from the People's Republic of China ("China"). See Final Scope Ruling on Agilent Technologies, Inc.'s Mass Filter Radiator, A–570–967 and C–570–968 (Aug. 10, 2016), available at http://enforcement.trade.gov/download/prc-ae/scope/97-mass-filter-radiator-10aug16.pdf (last visited Aug. 24, 2017) ("Final Scope Ruling"). See also Aluminum Extrusion from the People's Republic of China, 76 Fed. Reg. 30,650 (Dep't Commerce May 26, 2011) (antidumping duty order) ("Antidumping Duty Order") and Aluminum Extrusions from the People's Republic of China, 76 Fed. Reg. 30,653 (Dep't Commerce May 26, 2011) (countervailing duty order) ("Countervailing Duty Order") (collectively, "Orders"). Before the court is Plaintiff's Rule 56.2 motion for judgment on the agency record, in which Plaintiff argues that Commerce erred in finding that Agilent's MFR is covered by the scope of the Orders. See Pl.'s Rule 56.2 Mot. J. Agency R., Mar. 31, 2017, ECF No. 23; Pl.'s Mem. P. & A. Supp. Mot. J. Agency R. 1–4, Mar. 31, 2017, ECF No. 23–1 ("Pl.'s Mot."). The United States ("Defendant") and Defendant–Intervenor Aluminum Extrusions Fair Trade Committee ("Defendant–Intervenor") oppose Plaintiff's motion. See Def.'s Resp. Pl.'s Rule 56.2 Mot. J. Agency R., June 5, 2017, ECF No. 24 ("Def.'s Resp."); Def.–Intervenor Aluminum Extrusions Fair Trade Committee's Resp. Br., June 5, 2017, ECF No. 25. For the reasons set forth below, the court remands Commerce's scope ruling.

BACKGROUND

Commerce issued two Orders on aluminum extrusions from China on May 26, 2011. See Antidumping Duty Order, 76 Fed. Reg. at 30,650 ; Countervailing Duty Order, 76 Fed. Reg. at 30,653. Both Orders have identical scope language, which provide the following description of subject merchandise:

The merchandise covered by this order is aluminum extrusions which are shapes and forms, produced by an extrusion process, made from aluminum alloys having metallic elements corresponding to the alloy series designations published by The Aluminum Association commencing with the numbers 1, 3, and 6 (or proprietary equivalents or other certifying body equivalents).

Antidumping Duty Order, 76 Fed. Reg. at 30,650 ; Countervailing Duty Order, 76 Fed. Reg. at 30,653. The Orders explicitly exclude "finished merchandise"¹ and "finished heat sinks."² See Antidumping Duty Order, 76 Fed. Reg. at 30,651 ; Countervailing Duty Order, 76 Fed. Reg. at 30,654.

On November 20, 2014, Plaintiff submitted a scope ruling request seeking confirmation from Commerce that the MFR is outside the scope of the Orders. See Scope Inquiry on Certain Finished Aluminum Components from the People's Republic of China: Mass Filter Radiator, PD 1, bar code 3245192–01, CD 1, bar code 3245188–01 (Nov. 20, 2014) ("Agilent's Scope Ruling Request").³ Agilent describes its product as a machined aluminum component, which is plated with a proprietary material to provide specific levels of thermal resistance and is designed and fabricated for use in Agilent's mass spectrometer. See id. at 2–5. The MFR houses the central components of the mass spectrometer and, according to Agilent, plays an important role in transferring heat from critical components. See id. Agilent asserted that its MFR should be excluded from the scope of the Orders on the basis that: (1) the MFR is within the finished merchandise exclusion because it is a finished product comprised exclusively of aluminum extrusions; and (2) the MFR is within the finished heat sink exclusion because it was designed precisely to have specific thermal resistance properties to remove damaging heat from electronic equipment and the MFR has been tested around meeting certain thermal requirements. See Agilent's Scope Ruling Request at 5–12.

After receiving Agilent's Scope Ruling Request, Commerce sent Agilent supplemental questionnaires requesting information on the MFR's production process, thermal resistance properties, performance requirements, and testing procedures used to ensure compliance with those requirements. See Aluminum Extrusions from the People's Republic of China: Mass Filter Radiators, PD 6, bar code 3259038–01 (Feb. 10, 2015) (supplemental questionnaire); Scope Inquiry on Agilent's Mass Filter Radiator, PD 24, bar code 3433012–01 (Jan. 15, 2016) (supplemental questionnaire); Scope Inquiry on Agilent's Mass Filter Radiator, PD 31, bar code 3457413–01 (Apr. 8, 2016) (supplemental questionnaire).⁴ Plaintiff responded to Commerce's questionnaires and claimed that the "primary function of the MFR is to transfer heat from the heat source to the quadrupole." Agilent Technologies: Scope Request (Mass Filter Radiator) at 2, PD 39, bar code 3523198–01 (Mar. 23, 2015) (response to questionnaire) ("Mar. 23 Response"). See also Scope Inquiry on Agilent's Mass Filter Radiator, PD 28, bar code 3446604–01, CD 6, bar code 3440873–01 (Feb. 10, 2016) (supplemental questionnaire response) ("Feb. 10 Response"); Scope Inquiry on Agilent's Mass Filter Radiator, PD 29, bar code 3468739–01 (May 13, 2016) (April 8—request for information response) ("May 13 Response"). Agilent also provided a declaration from its Research and Development Project Manager to support the assertion that the MFR acts as a finished heat sink. See Feb. 10 Response at Attach. 7 ("R & D Declaration"). The R & D Declaration explained the details regarding the heat transfer properties of the MFR, which included certain material specifications, required temperature changes, and thermal resistance parameters. See id.

Commerce issued its Final Scope Ruling on August 10, 2016, finding that the MFR is within the scope of the Orders and did not qualify for either of the two exclusions proposed by Agilent. See Final Scope Ruling at 17–23. With respect to the finished merchandise exclusion, Commerce found that the MFR does not contain non-extruded aluminum parts, is processed in a manner consistent with the scope of the Orders, and fits within the physical description of an aluminum extrusion product covered by the Orders. See id. at 17–21. With respect to the finished heat sink exclusion, Commerce concluded that Agilent failed to establish with evidence on the record that the MFR was designed "around meeting specific thermal performance requirements" and was sufficiently "tested to meet such specific thermal performance requirements." Id. at 21.

Plaintiff commenced this action on September 14, 2016. See Summons. Plaintiff filed its Rule 56.2 motion on March 31, 2017, asserting that Commerce's Final Scope Ruling was unsupported by substantial evidence. See Pl.'s Mot. 24. Defendant argues that the Final Scope Ruling should be affirmed because it is supported by substantial evidence and is in accordance with the law. See Def.'s Resp. 26.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction to review Commerce's scope determination. See 28 U.S.C. § 1581(c) (2012) ;⁵ Section 516A(a)(2)(B)(vi) of the Tariff Act of 1930, as amended 19 U.S.C. § 1516a(b)(1)(B)(i) (2015).⁶ The court must set aside "any determination, finding, or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i). See also NMB Singapore Ltd. v. United States, 557 F.3d 1316, 1319 (Fed. Cir. 2009) ; NSK Ltd. v. United States, 510 F.3d 1375, 1379 (Fed. Cir. 2007). "Substantial evidence ... means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." A.L. Patterson, Inc. v. United States, 585 Fed.Appx. 778, 781–82 (Fed. Cir. 2014) (quoting Consol. Edison Co. of N.Y. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938) ).

DISCUSSION

Plaintiff alleges that the Final Scope Ruling was unsupported by substantial evidence. See Pl.'s Mot. 14–20. Plaintiff argues that detailed information provided in its application and subsequent filings, including the R & D Declaration, establish that its MFR is a finished heat sink excluded from the scope of the Orders. See id. at 15–16. Defendant counters that Commerce's determination was supported by substantial evidence because the record demonstrates that the MFR does not qualify for the finished heat sink exclusion.⁷ See Def.'s Resp. 14–25.

The scope of an antidumping or countervailing duty order may need clarification at times "because the descriptions of subject merchandise contained in the Department's determinations must be written in general terms." 19 C.F.R. § 351.225(...