Ugine and Alz Belgium, N.V. v. U.S.

• Decision Date: 01 October 2007
• Docket Number: Court No. 05-00444.,No. Slip Op. 07-145.,Slip Op. 07-145.
• Citation: 517 F.Supp.2d 1333
• Parties: UGINE AND ALZ BELGIUM, N.V., Arcelor Stainless USA, LLC, and Arcelor Trading USA, LLC, Plaintiffs, v. UNITED STATES, Defendant, and Allegheny Ludlum Corporation, AK Steel Corporation, United Auto Workers Local 3303, United Steelworkers of America, AFL-CIO/CLC, North American Stainless and Zanesville Armco Independent Organization, Defendants-Intervenor.
• Court: U.S. Court of International Trade

Page 1333

517 F.Supp.2d 1333

UGINE AND ALZ BELGIUM, N.V., Arcelor Stainless USA, LLC, and Arcelor Trading USA, LLC, Plaintiffs, v. UNITED STATES, Defendant, and Allegheny Ludlum Corporation, AK Steel Corporation, United Auto Workers Local 3303, United Steelworkers of America, AFL-CIO/CLC, North American Stainless and Zanesville Armco Independent Organization, Defendants-Intervenor.

No. Slip Op. 07-145.

Court No. 05-00444.

United States Court of International Trade.

October 1, 2007.

Shearman & Sterling LLP, (Ryan A.T. Trapani and Robert S. LaRussa), Washington, DC, for Plaintiffs.

Peter D. Keisler, Assistant Attorney General; Jeanne E. Davidson, Director; Patricia M. McCarthy, Assistant Director; and Michael D. Panzera, Trial Attorney, Civil Division, U.S. Department of Justice, Commercial Litigation Branch; Jennifer I. Johnson, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, of Counsel, for Defendant.

Kelly Drye Collier Shannon (R. Alan Luberda; David A. Hartquist; and Adam

H. Gordon), Washington, DC, for Defendants-Intervenor.

OPINION

GREGORY W. CARMAN, Judge.

This matter is before this Court on motion for judgment upon the agency record and on motion to dismiss. Plaintiffs, Ugine & ALZ Belgium, N.V., Arcelor Stainless USA, LLC, and Arcelor Trading USA, LLC's (together "Plaintiffs"), move pursuant to USCIT R. 56.1 to challenge certain final liquidation instructions¹ issued by the International Trade Administration of the U.S. Department of Commerce ("Government" or "Commerce" or "Defendant") on the grounds that they are arbitrary, capricious or otherwise not in accordance with law. Commerce moves to dismiss Plaintiffs' Complaint, pursuant to USCIT R. 12(b)(1), arguing that this Court lacks subject matter jurisdiction under 28 U.S.C. § 1581(i). Alternatively, assuming jurisdiction is proper, Commerce opposes Plaintiffs' motion for judgment upon the agency record. The domestic industry, petitioners of the initial antidumping duty ("ADD") and countervailing duty ("CVD") orders, participate in this action as Defendants-Intervenor and support Defendants motions.

As discussed below, this Court denies Defendant's motion in its entirety and finds that Commerce's liquidation instructions are indeed arbitrary, capricious or otherwise not in accordance with law. This Court therefore grants Plaintiffs' motion and remands this matter to Commerce to issue revised liquidation instructions consistent with this Opinion. A separate Order of the Court will issue.

PROCEDURAL HISTORY

On December 14, 2004, Commerce published the final results of the fourth administrative review of the antidumping order on certain stainless steel plate in coils ("SSPC") from Belgium. SSPC from Belgium, 69 Fed.Reg. 74,495 (Dep't Commerce Dec. 14, 2004) (final results of ADD administrative review) [hereinafter "Final Results"]. Among other things decided in the Final Results, Commerce determined, following a country-of-origin review, that certain SSPC that had been hot-rolled in Germany and not further cold-rolled in Belgium fell outside the scope of the ADD order for Belgian SSPC because SSPC that had been produced according to those specifications was of German origin.²

Subsequently, on February 22, 2005 Commerce issued draft liquidation and cash deposit instructions and solicited comments therein. (See Letter from Maria MacKay to All Interested Parties (Feb. 22, 2005), Conf. R. Doc. 4.) Plaintiffs argued that Commerce amend the liquidation instructions to reflect that "all entries of SSPC ... hot rolled in Germany and not further cold rolled in Belgium [are] outside the scope" of the ADD and CVD orders "and, therefore, should be liquidated [duty] free." (Letter from Robert S. LaRussa, Counsel to U & A Belgium, to Hon. Carlos M. Gutierrez, Secretary of Commerce, 3 (Feb. 24, 2005), Pub. R. Doc. 8.)

In May and June 2005 Commerce staff held several ex parte meetings with Plaintiffs and Defendants-Intervenor, concerning the language of the proposed liquidation instructions and whether Commerce should apply its country-of-origin determination retroactively to cover Plaintiffs' unliquidated entries from prior administrative reviews.

On July 1, 2005, Commerce released a memorandum decision ruling, inter alia, that the country-of-origin determination, previously published in the Final Results, supra, would be applied only to "entries covered by the fourth review and future entries, i.e., to entries made on or after May 1, 2002," (See Customs Instructions for the Final Results of the Fourth Administrative Review of the ADD Order on SSPC from Belgium, 5 (July 1, 2005), Pub. R. Doc. 19 [hereinafter "Liquidation Instr. Mem."].) Commerce then proceeded to issue additional liquidation and cash deposit instructions, which also rejected Plaintiffs' position that the country-of-origin determination from the Final Results should be applied retroactively. See note 1, supra.

Plaintiffs timely filed suit challenging Commerce's liquidation instructions and asked the court to enjoin liquidation of the entries at issue, pending the outcome of this action. The court denied Plaintiffs' request for a preliminary injunction. Ugine & Alz Belgium v. United States, 29 CIT ___, 391 F.Supp.2d 1284 (2005). The U.S. Court of Appeals for the Federal Circuit ("CAFC") reversed and instructed the court to enjoin liquidation of Plaintiffs' entries. Ugine & Alz Belgium. v. United States, 452 F.3d 1289 (Fed.Cir.2006). The court thereafter issued an Order of Preliminary Injunction. (See Order of Preliminary Injunction, Ct. R. Doc. 44.)

FACTUAL BACKGROUND

Plaintiffs are importers of SSPC. (Compl. ¶¶ 1-3; Ugine & Alz Belgium, 452 F.3d at 1290). Following multiple investigations concerning importations of SSPC from numerous countries, Commerce published an affirmative CVD order and an affirmative ADD order covering, inter alia, Belgian SSPC. SSPC from Belgium, Italy & South Africa, 64 Fed.Reg. 25,288 (Dep't Commerce May 11, 1999) (notice of CVD orders); Certain SSPC from Belgium, Canada, Italy, the Republic of Korea, South Africa, & Taiwan, 64 Fed.Reg. 27,756 (Dep't Commerce May 21, 1999) (notice of ADD orders).

I. First Administrative Review

In July 2000, Commerce initiated the first administrative review of the ADD and CVD orders for Belgian SSPC for the period of review ("POW') November 4, 1998 through April 30, 2000. Initiation of ADD & CVD Administrative Reviews & Requests for Revocations in Part, 66 Fed. Reg. 41,942 (Dep't Commerce July 7, 2000). Because, Plaintiffs ceased cooperation with Commerce during this first administrative review, Commerce assigned Plaintiffs an ADD margin based on adverse facts available. SSPC from Belgium, 66 Fed.Reg. 56,272, 56,273 (Dep't Commerce Nov. 7, 2001) (final results of ADD administrative review). Plaintiffs did not appeal the final results of the first administrative review, however, Defendants-Intervenor (the domestic industry) did. See Allegheny Ludlum Corp. v. United States, 27 CIT 1461, 1461 (2003) (appealing Commerce's calculation of the total adverse facts available rate during the first administrative review).

In August 2001, Commerce issued its final determination in the first CVD administrative review. SSPC, 66 Fed.Reg. 45,007 (Dep't Commerce Aug. 27, 2001) (final results of CVD administrative review). Plaintiffs appealed this final determination. ALZ N.V. v. United States, 27 CIT 1265, 283 F.Supp.2d 1302 (2003). In December 2001, the court preliminarily enjoined liquidation of entries that were subject to the CVD administrative review. (See Def.'s Mot. to Dismiss & Resp. to Mot. for J. upon the Agency R. 4-5 ("Def.Br.").) Accordingly, liquidation was suspended for Plaintiffs' entries that were simultaneously subject to both the CVD order and the ADD order. (Id.); see also Suspension of Liquidation Instructions, Message No. 3351206 (Dep't Commerce Dec. 17, 2003); Suspension of Liquidations Instructions, Message No. 3357201 (Dep't Commerce Dec. 23, 2003).

In July 2003, the court remanded the matter to Commerce. See ALZ N.V., 27 CIT at 1286, 283 F.Supp.2d at 1320. Almost a year later, in April 2004, the court sustained Commerce's determination regarding the first CVD administrative review. ALZ N.V. v. United States, 28 CIT 541, 541 (2004).³ Commerce thereafter published amended final results. Stainless Steel Plate Coils from Belgium, 70 Fed.Reg. 18,374 (Dep't Commerce Apr. 11, 2005) (notice of amended final results of CVD administrative review).

As a result of the litigation stemming from the first administrative review, which had not been fully resolved until April 2005, there remained perhaps dozens of unliquidated entries still under suspension. For Plaintiffs, this fortunate circumstance forms the backdrop to this lawsuit. Before Commerce could issue liquidation instructions for these entries, following publication of the amended final results for the CVD administrative review, Plaintiffs brought the instant lawsuit, including an application to enjoin liquidation of these first POR entries.

II. The Fourth Administrative Review⁴

The fourth administrative review was initiated by request from both Plaintiffs and Defendants-Intervenor. Initiation of ADD & CVD Administrative Reviews & Request for Revocation in Part, 68 Fed. Reg. 39,055 (Dep't Commerce July 1 2003). Plaintiffs had undergone an organizational change ("U & A Belgium" was created following Ugine, S.A.'s purchase of ALZ, N.V.) due to a merger and had also switched counsel during this period. See SSPC from Belgium, 69 Fed.Reg. 32,501, 32,503 (Dep't Commerce June 10, 2004) (preliminary results of ADD administrative review) [hereinafter "Preliminary Results"].

It was during this, the fourth administrative review, that Plaintiffs petitioned Commerce "about determining [whether] German-origin SSPC is outside the scope of the administrative review of Belgian SSPC." (Letter from Robert LaRussa, Esq. to Hon. Donald L. Evans (...