Yieh Phui Enter. Co. v. United States

• Decision Date: 24 August 2011
• Docket Number: Slip Op. 11–107.Court No. 10–00310.
• Citation: 791 F.Supp.2d 1319
• Parties: YIEH PHUI ENTERPRISE CO., Plaintiff,v.UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

791 F.Supp.2d 1319

YIEH PHUI ENTERPRISE CO., Plaintiff,

v.UNITED STATES, Defendant.

Slip Op. 11–107.Court No. 10–00310.

United States Court of International Trade.

Aug. 24, 2011.

Appleton Luff Pte Ltd. (Kelly A. Slater), for Plaintiff Yieh Phui Enterprise Co. Ltd.Tony West, Assistant Attorney General, Jeanne E. Davidson, Director, Franklin E. White, Jr., Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, Washington, DC, (Melissa M. Devine); and Office of Chief Counsel for Import Administration, Department of Commerce (William G. Isasi), of counsel, for Defendant United States.

Schagrin Associates (Roger B. Schagrin, Washington, DC, John W. Bohn, Michael J. Brown), for Defendant–Intervenor Allied Tube and Conduit Corporation.King & Spalding (Gilbert B. Kaplan, Brian E. McGill, Daniel L. Schneiderman, P. Lee Smith), Washington, DC, for Defendant–Intervenor Wheatland Tube Company.

OPINION

GORDON, Judge:

This action involves an administrative review conducted by the United States Department of Commerce (“Commerce”) of the antidumping duty order covering certain circular welded carbon steel pipes and tubes from Taiwan. See Circular Welded Carbon Steel Pipes and Tubes from Taiwan, 75 Fed.Reg. 62,366 (Dep't of Commerce Oct. 8, 2010) (final results admin. review) (“ Final Results ”); see also Issues and Decision Memorandum, A–583–008 (Dep't of Commerce Sept. 30, 2010) available at http:// www. ia. ita. doc. gov/ frn/ summary/ TAIWAN/ 2010– 25298– 1. pdf (last visited Aug. 24, 2011) (“ Decision Memorandum ”). Before the court is Plaintiff Yieh Phui Enterprise Company's (“Yieh Phui”) motion for judgment on the agency record challenging Commerce's selection of invoice date as the date of sale for Plaintiff's U.S. sales. 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) (2006),¹ and 28 U.S.C. § 1581(c) (2006). For the reasons set forth below, the Final Results are sustained.

I. Standard of Review

For administrative reviews of antidumping duty orders, the court sustains Commerce's determinations, findings, or conclusions unless they are “unsupported by substantial evidence on the record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i). More specifically, when reviewing agency determinations, findings, or conclusions for substantial evidence, the court assesses whether the agency action is reasonable given the record as a whole. Nippon Steel Corp. v. United States, 458 F.3d 1345, 1350–51 (Fed.Cir.2006). Substantial evidence has been described as “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Dupont Teijin Films USA v. United States, 407 F.3d 1211, 1215 (Fed.Cir.2005) (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938)). Substantial evidence has also been described as “something less than the weight of the evidence, and the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence.” Consolo v. Fed. Mar. Comm'n, 383 U.S. 607, 620, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966). Fundamentally, though, “substantial evidence” is best understood as a word formula connoting reasonableness review. 3 Charles H. Koch, Jr., Administrative Law and Practice § 9.24[1] (3d. ed. 2011). Therefore, when addressing a substantial evidence issue raised by a party, the court analyzes whether the challenged agency action “was reasonable given the circumstances presented by the whole record.” Edward D. Re, Bernard J. Babb, and Susan M. Koplin, 8 West's Fed. Forms , National Courts § 13342 (2d ed. 2011).

Separately, when reviewing Commerce's interpretation of its regulations, the court accords the agency's interpretation “controlling weight unless it is plainly erroneous or inconsistent with the regulation.” Am. Signature, Inc. v. United States, 598 F.3d 816, 827 (Fed.Cir.2010) (quoting Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 414, 65 S.Ct. 1215, 89 L.Ed. 1700 (1945)).

II. Background

In general “an antidumping analysis involves a comparison of export price or constructed export price in the United States with normal value in the foreign market.” 19 C.F.R. § 351.401(a) (2010) ²; see also 19 U.S.C. §§ 1677a, 1677b. The date of sale for a respondent's U.S. sales is part of the export price calculation, which is then compared to normal value. See 19 C.F.R. § 351.401(a), (i). In the preliminary results Commerce used invoice date as the date of sale for Plaintiff's U.S. sales. In its administrative case brief Plaintiff argued that Commerce erred because Commerce's “calculation of the frequency of change to the material terms of sale between the final contract date and the invoice date was incorrectly based on a selective review of sales documents,” and that Plaintiff “had an extraordinarily low percentage of changes after the final contract date for its U.S. sales.” Yieh Phui Admin. Case Br. 3–4, PD 74.³ Plaintiff also argued that the difference in its U.S. sales and home market sales processes mandated use of contract date. Id. Plaintiff also argued that the facts and circumstances of its U.S. sales were similar to other administrative decisions in which Commerce used a date other than invoice date.

Commerce was not persuaded. In the Final Results Commerce provided a detailed, well-reasoned response to each of Plaintiff's arguments, and continued to use invoice date for Plaintiff's U.S. sales. See Decision Memorandum at 4–8. Specifically, Commerce found that Plaintiff underreported the total number of U.S. sales for which the material terms changed after contract date and therefore understated those changes during the period of review. Id. at 8; Final Analysis Memorandum for Yieh Phui Enterprise Co., Ltd.: Circular Welded Carbon Steel Pipes and Tubes from Taiwan (A–583–008), May 1, 2008–April 30, 2009 at 3–4 (“ Confidential Final Analysis Memorandum ”), CD 24. Commerce concluded that the material terms of multiple U.S. sales changed after contract date and selected invoice date as the date of sale. Id. Commerce also rejected Plaintiff's arguments that relied on differences in Plaintiff's U.S. and home market sales processes to establish contract date as the date of sale. See Decision Memorandum at 6–8.

III. Discussion

The antidumping statute does not specifically address Commerce's selection of date of sale. Commerce, however, has a long-standing regulation that does, 19 C.F.R. § 351.401(i) (“Date of Sale”). Section 351.401(i) provides that Commerce “normally will use the date of invoice” as the date of sale. The regulation specifies invoice date as the presumptive date of sale because

as a matter of commercial reality, the date on which the terms of a sale are first agreed is not necessarily the date on which those terms are finally established. In the Department's experience, price and quantity are often subject to continued negotiation between the buyer and the seller until a sale is invoiced. The existence of an enforceable sales agreement between the buyer and the seller does not alter the fact that, as a practical matter, customers frequently change their minds and sellers are responsive to those changes. The Department also has found that in many industries, even though a buyer and seller may initially agree on the terms of a sale, those terms remain negotiable and are not finally established until the sale is invoiced. Thus, the date on which the buyer and seller appear to agree on the terms of a sale is not necessarily the date on which the terms of sale actually are established. The Department also has found that in most industries, the negotiation of a sale can be a complex process in which the details often are not committed to writing. In such situations, the Department lacks a firm basis for determining when the material terms were established. In fact, it is not uncommon for the buyer and seller themselves to disagree about the exact date on which the terms became final. However, for them, this theoretical date usually has little, if any, relevance. From their perspective, the relevant issue is that the terms be fixed when the seller demands payment (i.e., when the sale is invoiced).

Antidumping Duties; Countervailing Duties: Final Rule, 62 Fed.Reg. 27,296, 27,348–49 (Dep't of Commerce May 19, 1997) (“ Preamble ”). Notwithstanding the regulatory presumption of invoice date, Commerce “may use a date other than the date of invoice if [Commerce] is satisfied that a different date better reflects the date on which the exporter or producer establishes the material terms of sale.” 19 C.F.R. § 351.401(i). In implementing the regulation, Commerce further explained that if

the Department is presented with satisfactory evidence that the material terms of sale are finally established on a date other than the date of invoice, the Department will use that alternative date as the date of sale. For example, in situations involving large custom-made merchandise in which the parties engage in formal negotiation and contracting procedures, the Department usually will use a date other than the date of invoice. However, the Department emphasizes that in these situations, the terms of sale must be firmly established and not merely proposed. A preliminary agreement on terms, even if reduced to writing, in an industry where renegotiation is common does not provide any reliable indication that the terms are truly “established” in the minds of the buyer and seller. This holds even if, for a particular sale, the terms were not renegotiated.

62 Fed.Reg. at 27,349. Commerce therefore has some flexibility in selecting the date of sale; the presumption in favor of invoice date is not conclusive. See, e.g., Circular Welded Non–Alloy Steel Pipe From the Republic of Korea, 63 Fed.Reg. 32,833, 32,385 (Dep't...