U.S. Steel Corp. v. U.S.

Decision Date20 July 2009
Docket NumberSlip Op. 09-74. Court No. 07-00170.
Citation637 F.Supp.2d 1199
PartiesUNITED STATES STEEL CORPORATION, Plaintiff, and Nucor Corporation, Gallatin Steel Company, SSAB North American Division, Steel Dynamics Inc., and Arcelormittal USA, Inc., Plaintiff-Intervenors, v. UNITED STATES, Defendant, and Corus Staal BV, Defendant-Intervenor.
CourtU.S. Court of International Trade

Skadden Arps Slate Meagher & Flom, LLP, Washington, DC (Robert E. Lighthizer, Jeffrey D. Gerrish, Ellen J. Schneider, and Luke A. Meisner), for Plaintiff United States Steel Corporation.

Wiley Rein (Alan H. Price and Timothy C. Brightbill), for Plaintiff-Intervenor Nucor Corporation.

Schagrin Associates (Roger B. Schagrin and Michael J. Brown), for Plaintiff-Intervenors Gallatin Steel Company, SSAB North American Division, and Steel Dynamics Inc.

Stewart and Stewart, Washington, DC (Terence P. Stewart and William A. Fennell), for Plaintiff-Intervenor ArcelorMittal USA, Inc.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director; Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Claudia Burke); Sapna Sharma, Office of the Chief Counsel for Import Administration, United States Department of Commerce, Of Counsel, for Defendant United States.

Steptoe & Johnson LLP, Washington, DC (Richard O. Cunningham, Joel D. Kaufman, Alice A. Kipel, and Jamie B. Beaber), for Defendant-Intervenor Corus Staal BV.



In December 2006, the U.S. Department of Commerce ("Commerce") determined that it would apply a new methodology to calculate the weighted-average dumping margins in certain investigations. See Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an Antidumping Investigation; Final Modification, 71 Fed.Reg. 77,722, 77,722 (Dep't Commerce Dec. 27, 2006) ("Section 123 Determination").1 Plaintiff United States Steel Corporation ("U.S.Steel"), along with other interested domestic parties,2 challenge that determination in a particular Section 129 proceeding,3 claiming that the use of offsetting and the elimination of zeroing is not in accordance with antidumping law.4 Plaintiff and Plaintiff-Intervenors also allege that Commerce's application of the methodology outlined in the Section 123 Determination to reach the final results of the Section 129 Determination was not in accordance with law. Finally, Plaintiff-Intervenors Nucor and ArcelorMittal argue that Commerce erred when it declined to consider their claims of targeted dumping in the Section 129 Determination.5 For the reasons stated below, the court rejects all three claims in Plaintiff's and Plaintiff-Intervenors' Motions for Judgment Upon the Agency Record and, therefore, denies the motions and grants judgment to the Government.

I. Background
A. The Purpose of the Antidumping Laws and the Weighted-Average Dumping Margin

The central aim of the antidumping laws is to protect domestic industries from foreign manufactured goods that are sold injuriously in the United States at prices below the fair market value of those goods in their home market. See Sango Int'l, L.P. v. United States, 484 F.3d 1371, 1372 (Fed.Cir.2007). The antidumping laws are not punitive in nature, but rather, are meant to "remedy disparities in the value of imported and domestic merchandise created by impermissible international trade practices." Bethlehem Steel Corp. v. United States, 25 CIT 930, 933, 162 F.Supp.2d 639, 643 (2001). The application of antidumping principles should level the playing field between foreign and domestic manufacturers of like merchandise and not give an unfair advantage to the domestic industry. See Peer Bearing Co. v. United States, 25 CIT 1199, 1221, 182 F.Supp.2d 1285, 1310 (2001).

Commerce is required to impose an antidumping duty order on imported merchandise that (1) is sold in the U.S. below its fair value and (2) materially injures or threatens to injure a domestic industry. 19 U.S.C. § 1673. The determination of whether the subject imports are sold at less than fair value involves a two-step process, whereby Commerce must first calculate the "dumping margin"—the amount by which "the normal value [(`NV')] exceeds the export price [(`EP')] or constructed export price [(`CEP')] of the subject merchandise."6 19 U.S.C § 1677(35)(A). If the price of a good in the home market (NV) is greater than the price for the same good in the U.S. (EP or CEP), then the dumping margin comparison produces a positive number indicating that dumping has occurred. In contrast, when the price charged for the subject merchandise in the U.S. (EP or CEP) is greater than that charged for the same merchandise in the home market (NV), the dumping margin calculation yields a negative value, showing that those sales were made fairly.

The second step of the process requires Commerce to determine the weighted-average dumping margin, which expresses the dumping margin as a percentage and is determined by dividing the aggregate dumping margins of a specific exporter or producer by the aggregate export or constructed export prices of that same exporter or producer. § 1677(35)(B). Importantly, under Commerce's new methodology of offsetting, the numerator in the weighted-average dumping margin calculation is the aggregate of all dumping margins (i.e., those that have both positive and negative values). Under the previously employed zeroing methodology, those dumping margins with a negative value were given an assumed value of zero. A weighted-average dumping margin that yields a positive value demonstrates, on the whole, that the subject merchandise was dumped in the United States.

If the International Trade Commission ("ITC") finds that the dumped subject merchandise causes the domestic industry to suffer material injury or threatens material injury, then Commerce must issue an antidumping duty order covering entries of the subject merchandise. 19 U.S.C. § 1673. The antidumping duty imposed on entries of the subject merchandise is equal in amount to the weighted-average dumping margin. §§ 1673, 1677(35)(A)-(B).

B. Sections 123 and 129 of the Uruguay Round Agreements Act

Congress established two procedures by which an adverse decision from the World Trade Organization ("WTO") Dispute Settlement Panel or Appellate Body may be implemented into domestic law—Sections 123 and 129 of the Uruguay Round Agreements Act ("URAA"). A Section 123 determination amends, rescinds, or modifies an agency regulation or practice that is found to be inconsistent with any of the Uruguay Round Agreements. 19 U.S.C. § 3533(g)(1). This scheme requires the United States Trade Representative ("USTR"), an official of the Executive Branch, to consult with the appropriate congressional and private sector advisory committees, and to provide an opportunity for public comment before determining whether and how to implement the agency regulation or practice at issue. Id. The USTR, as part of the consultation process, is required to provide the relevant congressional committees with a report that describes the proposed modification, the reasons for the modification, and a summary of the advice obtained from the private sector advisory committees. § 3533(g)(1)(D). The final modification takes effect when it is published in the Federal Register. § 3533(g)(1)(F).

The second procedure—a Section 129 determination—amends, rescinds, or modifies the application of an agency regulation or practice in a specific antidumping, countervailing duty, or safeguards proceeding that is found to be inconsistent with U.S. obligations under the WTO Antidumping Agreement ("AD Agreement"), the Agreement on Subsidies and Countervailing Measures, or the Safeguards Agreement. 19 U.S.C. § 3538(a)(1), (b)(1). Here, the USTR must consult with the relevant congressional committees and request in writing that the pertinent agency issue a new determination consistent with the findings set forth in the WTO Panel or Appellate Body Report. §§ 3538(a)(1), (a)(3)-(5), (b)(1)-(3). Interested parties may also submit written comments on the proposed modification and, where appropriate, ask for an administrative hearing on the matter. § 3538(d). A Section 129 determination takes effect on or after the date on which the USTR directs the agency to implement the determination in whole or in part. § 3538(c)(1). Commerce must also publish the determination in the Federal Register to provide notice of the agency action to interested parties. § 3538(c)(2).

C. The Original Antidumping Duty Order & Subsequent Developments

On November 29, 2001, after the ITC had determined that the subject imports injured the domestic industry, Commerce issued an antidumping duty order covering hot-rolled carbon steel flat products from the Netherlands. See Antidumping Duty Order: Certain Hot-Rolled Carbon Steel Flat Products From the Netherlands, 66 Fed.Reg. 59,565, 59,566 (Dep't Commerce Nov. 29, 2001). Commerce used zeroing to calculate the final dumping margin for the subject merchandise, finding a dumping margin of 2.59% for the sole respondent Corus. See id.; Notice of Final Determination of Sales at Less Than Fair Value; Certain Hot-Rolled Carbon Steel Flat Products From The Netherlands, 66 Fed. Reg. 50,408, 50,409 (Dep't Commerce Oct. 3, 2001); Issues and Decision Memorandum for the Antidumping Investigation of Certain Hot-Rolled Carbon Steel Flat Products from the Netherlands; Notice of Final Determination of Sales at Less Than Fair Value (A-421-807), A-421-807 (Oct. 3, 2001), available at 2001 WL 1168309, at *6-7. During the investigation, neither the Plaintiff nor the Plaintiff-Intervenors made an allegation of targeted dumping, and Commerce did not determine whether it had occurred.

The European Communities thereafter challenged Commerce's use of zeroing in...

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