Venus Wire Indus. Pvt. Ltd. v. United States

• Decision Date: 20 December 2019
• Docket Number: Court No. 18-00113,Slip Op. 19-170
• Citation: 424 F.Supp.3d 1369
• Parties: VENUS WIRE INDUSTRIES PVT. LTD., et al., Plaintiffs, v. UNITED STATES, Defendant, and Carpenter Technology Corporation, et al., Defendant-Intervenors.
• Court: U.S. Court of International Trade

424 F.Supp.3d 1369

VENUS WIRE INDUSTRIES PVT. LTD., et al., Plaintiffs,

v. UNITED STATES, Defendant,andCarpenter Technology Corporation, et al., Defendant-Intervenors.

Slip Op. 19-170

Court No. 18-00113

United States Court of International Trade.

December 20, 2019

Eric C. Emerson, Steptoe & Johnson LLP, of Washington, DC, argued for Plaintiffs. With him on the brief was St. Lutheran M. Tillman.

Kara M. Westercamp, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for Defendant. With her on the brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and Tara Hogan, Assistant Director. Of counsel on the brief was Emma T. Hunter, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Grace W. Kim, Kelley Drye & Warren LLP, of Washington, DC, argued for Defendant-Intervenors. With her on the brief was Laurence J. Lasoff.

OPINION AND ORDER

Barnett, Judge:

Plaintiffs, Venus Wire Industries Pvt. Ltd. and its affiliates Precision Metals, Sieves Manufacturers (India) Pvt. Ltd., and Hindustan Inox Ltd. (collectively, "Venus"), challenge the U.S. Department of Commerce's ("Commerce" or "the agency") final results in the changed circumstances review of the antidumping duty order on stainless steel bar from India. See Compl., ECF No. 9; Stainless Steel Bar From India , 83 Fed. Reg. 17,529 (Dep't Commerce Apr. 20, 2018) (final results of changed circumstances review and reinstatement of certain companies in the antidumping duty order) (" Final Results "), ECF No. 20-5, and accompanying Issues and Decision Mem., A-533-810 (Apr. 16, 2018) ("I&D Mem."), ECF No. 20-6.¹

Venus challenges two aspects of the Final Results . Venus first contests Commerce's determination that Venus is not the producer of subject merchandise made using inputs that are covered by the scope of the underlying antidumping duty order and the corresponding determination that the producers are the unaffiliated suppliers of the inputs. Confidential Pls.' Rule 56.2 Mot. For J. Upon the Agency R., ECF No. 33, and Confidential Venus Wire Indus. Pvt. Ltd. and its Affiliates Precision Metals, Sieves Mfrs. (India) Pvt. Ltd., and Hindustan Inox Ltd.'s Mem. of P&A in Supp. of their Mot. For J. on the Agency R. ("Pls.' Mem.") at 8–15, ECF No. 33. Venus also contests Commerce's decision to use total facts otherwise available with an adverse inference (referred to as "total adverse facts available" or "total AFA") to determine Venus's rate. See id. at 16–28.

Defendant United States ("the Government") and Defendant-Intervenors² defend the Final Results . See generally Confidential Def.'s Resp. to Pls.' Mots. For J. Upon the Agency R. ("Def.'s Resp."), ECF No. 39; Confidential Def.-Ints.' Resp. in Opp'n to Pls.' Mot. For J. on the Agency R. ("Def.-Ints.' Resp."), ECF No. 42.

For the following reasons, the court remands Commerce's determination that Venus is not the producer of the subject merchandise and defers consideration of arguments regarding the agency's use of total AFA pending Commerce's redetermination on remand.

BACKGROUND

Commerce published the antidumping duty order on stainless steel bar ("SSB" or "SS bar") from India on February 21, 1995. See Stainless Steel Bar from Brazil, India and Japan , 60 Fed. Reg. 9,661 (Dep't Commerce Feb. 21, 1995) (antidumping duty orders) ("SS Bar Order ").³ On September 13, 2011, Commerce conditionally revoked the SS Bar Order with respect to subject merchandise produced or exported by Venus. See Stainless Steel Bar from India , 76 Fed. Reg. 56,401, 56,402 -03 (Dep't Commerce Sept. 13, 2011) (final results of the antidumping duty admin. review, and revocation of the order, in part) ("Revocation Finding ").⁴

On September 29, 2016, Petitioners submitted a request for a "changed circumstances" review of Venus and Viraj Profiles Ltd. on the basis that they had resumed selling SS bar in the United States at less than fair value. Pet'rs' Req. for Changed Circumstances Reviews (Sept. 29, 2016) at 1, 5, CR 1, PR 1, CJA Tab 1.⁵ On December 16, 2016, Commerce initiated a changed circumstances review for such purpose. See Stainless Steel Bar From India , 81 Fed. Reg. 91,118 (Dep't Commerce Dec. 16, 2016) (initiation of antidumping duty changed circumstances review).

Venus responded to several questionnaires during the review. In section A of Commerce's initial questionnaire, the agency requested Venus to describe the materials used in the production of subject merchandise. Questionnaire to Venus (Sec. A) (Dec. 14, 2016) at A-12, PR 48, CJA Tab 5. Venus responded that it uses "Stainless Steel Black Bars (round/hex/square) or Stainless Steel Rods in Coil Form." Submission of Resp. to Sec. A of the Questionnaire in Changed Circumstances Review (Jan. 30, 2017) ("Venus AQR") at A-24, CR 22, PR 65, CJA Tab. 6. In a separate chart, Venus stated that its production begins with "S.S. Wire Rods" or "S.S. Rounds - Hot Rolled." Venus AQR, Annex. A-8, Suppl. CJA at ECF p. 138.

In subsequent questionnaire responses, Venus referred to its inputs of SS black bar as SS rounds, straight rounds, or hot rolled bar. See I&D Mem. at 9 & n.26 (citation omitted); Venus Group Annex. SQR-27 (March 30, 2017), CR 105, PR 144, CJA Tab 10; Venus Group Annex. SQR-28 (March 30, 2017), CR 106, PR 145, CJA Tab 11; Venus Group's Resp. to Sec. B & C Suppl. Questionnaire (Apr. 3, 2017), Annex. D-2, CR 132, PR 173, Suppl. CJA at ECF pp. 212–19; Resp. to Sec. D of the Questionnaire (May 18, 2017) ("Venus 2nd Suppl. DQR") at 7, 13, Annex. DR-1, DR-2, CR 201, PR 260, Suppl. CJA at ECF pp. 254–82.

Supplier invoices appended to Venus's second supplemental questionnaire response alerted Commerce to the possibility that one of Venus's inputs might be subject merchandise; thus, the agency requested further information. I&D Mem. at 10 & n.29 (citing Venus 2nd Suppl. DQR, Annex. SQR-85, CR 207, PR 266, Suppl. CJA at ECF pp. 304–24); Resp. to SQR3-Questionnaire (July 10, 2017) ("Venus 3rd Suppl. DQR") at Question 15, CR 250, PR 308, CJA Tab 15. Venus reported that one of its inputs, "Stainless Steel Hot Rolled Bars (termed as SS rounds)" is "included in the scope of the [SS Bar Order ]." Venus 3rd Suppl. DQR at Question 15. Venus also described the processing it performs to convert the inputs into "Cold Finished Stainless Steel Bright Bars." Id.

Commerce preliminarily determined to reinstate Venus in the SS Bar Order based on the agency's finding that Venus sold subject merchandise at less than fair value. Decision Mem. for the Prelim. Results of the Antidumping Duty Changed Circumstances Review of Stainless Steel Bar from India (Oct. 12, 2017) at 1, PR 377, CJA Tab 19. Commerce further determined that Venus is not the producer of the subject merchandise and, in the absence of cost information from Venus's suppliers, assigned Venus a margin based on total AFA. Id. at 5, 7.

Thereafter, Commerce issued Venus a fourth supplemental questionnaire in which it requested Venus to "obtain the actual costs of production" from its suppliers of SS rounds used to make SS bar. Req. for Extension to 4th Suppl. Resp. (Nov. 14, 2017) at 1, CR 318–19, PR 398, CJA Tab 24. Venus reported its "significant efforts to obtain the cost of the stainless steel rounds purchased from unaffiliated suppliers during the [period of review]." Id. Those efforts included personal visits to several suppliers and emails "cautioning [the suppliers] of cessation of future business" if they refused to provide cost information. Id. at 3; see also id. at Ex. 1 (documenting Venus's efforts). Despite these efforts, only one of Venus's suppliers submitted its cost information to Commerce. Id. at 1–2.

On April 20, 2018, Commerce published the Final Results . Commerce continued to find that Venus is not the producer of subject merchandise manufactured from SS rounds. I&D Mem. at 11–14. Commerce did, however, conclude that Venus produced the subject merchandise manufactured from SS wire rod. Final Results Analysis Mem. for Venus Wire Indus. Pvt. Ltd. and its Affiliates Precision Metals, Sieves Mfrs. (India) Pvt. Ltd., and Hindustan Inox Ltd. (Apr. 16, 2018) ("Final Analysis Mem.") at 4, CR 327, PR 424, CJA Tab 32. Commerce reinstated Venus in the SS Bar Order and assigned Venus a weighted-average dumping margin of 30.92 percent based on the use of total AFA. Final Results , 83 Fed. Reg. at 17,530 ; see also I&D Mem. at 14–17; Final Analysis Mem. at 1–3.⁶

Venus timely commenced this action on May 18, 2018. See Summons, ECF No. 1. Venus's motion is fully briefed, and the court heard oral argument on September 10, 2019. Docket Entry, ECF No. 56.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2012),⁷ and 28 U.S.C. § 1581(c).

The court will uphold an agency determination that is supported by substantial evidence and otherwise in accordance with law. 19 U.S.C. § 1516a(b)(1)(B)(i). "Substantial evidence is ‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’ " Huaiyin Foreign Trade Corp. (30) v. United States , 322 F.3d 1369, 1374 (Fed. Cir. 2003) (quoting Consol. Edison Co. v. N.L.R.B. , 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938) ).

The two-step framework provided in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc. , 467 U.S. 837, 842–45, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), guides judicial review of Commerce's interpretation and implementation of the antidumping and countervailing duty statutes. See Apex Frozen Foods Private Ltd. v. United States , 862 F.3d 1337, 1344 (Fed. Cir. 2017) ; Pesquera Mares Australes Ltda. v. United States , 266 F.3d 1372, 1379–82 (Fed. Cir. 2001) (affording Chevron deference to agency methodology in furtherance of its statutory interpretations). First, the court...