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

• Decision Date: 14 August 2020
• Docket Number: Slip Op. 20-118,Court No. 18-00113
• Citation: 471 F.Supp.3d 1289
• 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

471 F.Supp.3d 1289

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

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

Slip Op. 20-118

Court No. 18-00113

United States Court of International Trade.

August 14, 2020

Eric C. Emerson and St. Lutheran M. Tillman, Steptoe & Johnson LLP, of Washington, DC, for Plaintiffs.

Kara M. Westercamp, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, 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 and Laurence J. Lasoff, Kelley Drye & Warren LLP, of Washington, DC, for Defendant-Intervenors.

OPINION AND ORDER

Barnett, Judge:

This matter is before the court following the U.S. Department of Commerce's ("Commerce" or "the agency") redetermination upon court-ordered remand. See Results of Redetermination Pursuant to Court Remand ("Remand Results"), ECF No. 61-1. Plaintiffs, Venus Wire Industries Pvt. Ltd. and its affiliates Precision Metals, Sieves Manufacturers (India) Pvt. Ltd., and Hindustan Inox Ltd. (collectively, "Venus"), commenced this action challenging Commerce's 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, an exporter of subject merchandise, contested Commerce's determinations (1) that Venus is not the producer of subject merchandise made from inputs that are covered by the scope of the underlying antidumping duty order; and (2) 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. [Venus's] Mem. of P & A in Supp. of their Mot. For J. on the Agency R. ("Pls.’ Mem."), ECF No. 33. In a previous opinion, the court remanded Commerce's determination that Venus is not the producer of subject merchandise manufactured from in-scope inputs and deferred Venus's challenge to Commerce's use of total AFA; familiarity with that opinion is presumed. See generally Venus Wire Indus. Pvt. Ltd. v. United States ("Venus I "), 43 CIT ––––, 424 F. Supp. 3d 1369 (2019).

Commerce has now issued a remand determination in which it provides additional explanation in support of its conclusion that Venus is not the producer of certain subject merchandise and made no changes to the Final Results . Remand Results at 3–11, 14–20. Venus opposes Commerce's Remand Results. See Pls.’ Comments on the Remand Redetermination ("Pls.’ Opp'n Cmts."), ECF No. 64. Defendant United States ("the Government") and Defendant-Intervenors² support Commerce's Remand Results. See Def.’s Resp. to Pls.’ Comments on the Remand Redetermination ("Def.’s Reply Cmts."), ECF No. 65; Def.-Ints.’ Reply to Pls.’ Comments on the Remand Redetermination ("Def.-Ints.’ Reply Cmts."), ECF No. 66.

For the reasons discussed herein, the court remands Commerce's Final Results , as amended by the Remand Results, for reconsideration of the agency's determination to use total AFA consistent with this Opinion.

BACKGROUND

I. Prior Proceedings³

Commerce published the antidumping duty order on stainless steel ("SS") 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 ").⁴ 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 ").⁵ Commerce subsequently initiated this "changed circumstances" review of Venus on December 16, 2016, in response to Petitioners’ allegations that the company "had resumed selling SS bar in the United States at less than fair value." Venus I , 424 F. Supp. 3d at 1372.

In the instant changed circumstances review, Commerce "requested Venus to describe the materials used in the production of subject merchandise." Id. Venus reported using SS wire rod or SS black bar to produce the subject merchandise. Id. Elsewhere in its questionnaire responses, Venus referred to its input of SS black bar variously as hot rolled SS rounds, SS rounds, straight rounds, or hot rolled bar. Id. In response to Commerce's third supplemental questionnaire, Venus acknowledged that the input referred to as "SS rounds" is covered by the scope of the SS Bar Order. Id.

Following issuance of the preliminary determination in which Commerce proposed to reinstate Venus in the SS Bar Order and found that Venus's unaffiliated suppliers of SS rounds were the producers of SS bar made using SS rounds, Commerce requested Venus to obtain cost information from those suppliers. See id. at 1373 ; Decision Mem. for the Prelim. Results of the Antidumping Duty Changed Circumstances Review of Stainless Steel Bar from India (Oct. 12, 2017) ("Prelim. Mem.") at 1, 5, PR 377, CJA Tab 19. In response, Venus reported its "significant efforts to obtain the cost of the stainless steel rounds purchased from unaffiliated suppliers during the [period of review]." Req. for Extension to 4th Suppl. Resp. (Nov. 14, 2017) ("Venus 4th Suppl. DQR") at 1, CR 318–19, PR 398, CJA Tab 24. Venus personnel visited several suppliers and sent its suppliers emails "cautioning them of cessation of future business" if they refused to provide their cost information. Id. at 3; see also id. at Ex. 1 (documenting Venus's efforts).⁶ "Despite these efforts, only one of Venus's suppliers submitted its cost information to Commerce." Venus I , 424 F. Supp. 3d at 1373 ; see also Venus 4th Suppl. DQR at 1–2.

For the Final Results , Commerce concluded that Venus was not the producer of subject merchandise manufactured from SS rounds;⁷ 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. 83 Fed. Reg. at 17,530 ; I & D Mem. at 11–17; Final Analysis Mem. at 1–3.

In making its determination, Commerce applied a test for identifying the producer of the subject merchandise that it first used in its investigation of narrow woven ribbon with woven selvedge from Taiwan. I & D Mem. at 11 & n.35 (citing Narrow Woven Ribbons with Woven Selvedge from Taiwan , 75 Fed. Reg. 41,804 (Dep't Commerce July 19, 2010) (notice of final determination of sales at less than fair value) ("NWR "), and accompanying Issues and Decision Mem., A-583-844 (undated) ("NWR Decision Mem.") at 48–49, available at https://enforcement.trade.gov/frn/summary/taiwan/2010-17538-1.pdf (last visited August 14, 2020)). Pursuant to NWR , Commerce considers "whether raw materials were added, and whether further processing was performed that changed the physical nature and characteristics of the product." NWR Decision Mem. at 48. Here, Commerce concluded that "because Venus's processing ‘does not affect three of the six essential physical characteristics’ of the subject merchandise ... and does not require the addition of new materials," Venus was not "the producer of the subject merchandise." Venus I , 424 F. Supp. 3d at 1375 (quoting I & D Mem. at 12–13).⁸ Commerce rejected Venus's argument that the agency should instead apply its substantial transformation test,⁹ explaining that "substantial transformation is not the proper analysis [when] both products at issue [i.e., input and output] fall within the same class or kind of merchandise." I & D Mem. at 13.

Regarding Commerce's use of total AFA, the agency explained that "necessary information" in the form of cost data from all except one of Venus's unaffiliated suppliers was missing from the record. Id. at 16. Commerce further determined that "[Venus] and its unaffiliated suppliers [ ] withheld information that [the agency] requested ..., failed to provide the information [ ] requested by the deadlines for submission of the information or in the form and manner [ ] requested ..., and have significantly impeded this proceeding." Id. Commerce also found that Venus "significantly impeded this proceeding" by failing "to clearly identify that it purchases SS Bar as an input until directly asked in the third supplemental questionnaire." Id. For those reasons, Commerce determined that it was necessary to select from among the facts otherwise available. Id. Commerce further determined that an adverse inference was appropriate when selecting from among the facts available. Id. at 16–17.

Commerce reasoned that Venus "failed to act to the best of its ability by failing to clearly identify that it purchase[d] SS Bar as an input until directly asked in the third supplemental questionnaire. Id. at 16. Commerce further found that Venus "did not act to the best of its ability in attempting to obtain its unaffiliated suppliers’ cost data," id. , because "it could have done more to induce its suppliers to cooperate," Final Analysis Mem. at 3. Commerce explained that Venus "is an experienced company [that] is seeking to maintain its exclusion from the order" and, thus, "it is reasonable to expect that, before doing business with these suppliers, [Venus] would ensure that it would have their full cooperation in any antidumping proceeding with Commerce." Id. Commerce faulted Venus for its delay in...