POGUE, Chief Judge:
In this action, Plaintiff Trust Chem Co., Ltd. ("Trust Chem" or "Plaintiff") seeks review of the final results of the U.S. Department of Commerce's ("Commerce" or "the Department") fourth administrative review of the antidumping order covering Carbazole Violet Pigment 23 ("CVP-23") from the People's Republic of China.
Specifically, Plaintiff claims that Commerce's choice of data to value the nitric
The court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (2006).
As explained below, the court concludes that Commerce's determination that its data is not aberrational requires reconsideration.
This case arises out of Commerce's 2004 antidumping order on CVP-23
In administrative proceedings involving goods from an NME, Commerce may approximate the normal value of the goods based on a "surrogate" for the value of their "factors of production" ("FOP"). 19 U.S.C. § 1677b(c);
Within these statutory limitations, Commerce selects a specific surrogate value in each individual administrative proceeding, by choosing the "best available information," 19 U.S.C. § 1677b(c),
Specifically, during the fourth administrative review of Commerce's antidumping order on CVP-23 from China, Trust Chem suggested that Commerce use a surrogate value for nitric acid, as published in the Indian periodical Chemical Weekly,
In the preliminary results, Commerce rejected these surrogate values. Instead, it utilized data from the Indian Department of Commerce's Export Import Data Bank, compiled in the World Trade Atlas ("WTA data"),
In the Final Results, again relying on WTA data, Commerce assigned Trust Chem a margin of 30.72 percent. Final Results, 75 Fed.Reg. at 36,632.
Trust Chem now challenges this decision, arguing that: (A) the data it proposed is more specific
After summarizing the applicable standard of review, the court will address each of Trust Chem's arguments in turn.
When reviewing the final results of an antidumping proceeding, the court assesses whether Commerce's decision is
"Normally, an agency rule would be arbitrary and capricious [and therefore unreasonable] if the agency has relied on factors which Congress has not intended it to consider ... [or] entirely failed to consider an important aspect of the problem." Motor Vehicle Mfrs. Ass'n. of U.S. v. State Farm Mut. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983); SKF USA Inc. v. United States, 630 F.3d 1365, 1374 (Fed.Cir.2011) (Commerce "has an `obligation' to address important factors raised by comments from petitioners and respondents.").
First, Plaintiff claims that Commerce's price determination is not supported by substantial evidence in the record because Commerce chose the "less specific" WTA data, which has "undetermined purity[.]" Pl.'s Br. 13.
Plaintiff argues that the Chemical Weekly data is more specific to its nitric acid, because the Chemical Weekly data is for nitric acid with a purity level of 60 percent, a level that is known and thus more product-specific than the unknown purity level of the WTA data. Id. at 9-10. Plaintiff adds that this value could have been "adjusted upward to at least partially account for the full costs of the higher purity level processing[.]" Id. at 28.
Commerce noted, however, that although the purity or concentration of the nitric acid included in the WTA data was unknown, the Chemical Weekly prices were for 60 percent or "weak" strength nitric acid, as opposed to the "high" strength 98 percent nitric acid used in the production of Trust Chem's merchandise. Because a simple conversion based on concentrations would not provide an accurate value, Commerce found that the Chemical Weekly prices were not the best available information, but rather the WTA data was the best option. I & D Mem. Cmt. 4 at 16.
To the court, neither party can establish the precise relationship of its data to the 98 percent nitric acid used in the production of Plaintiff's merchandise. In fact, neither value is more "specific" than the other.
Nevertheless, as long as Commerce reasonably explains its choice between two appropriate but imperfect alternatives, the court will not reject the agency's determination, even if the court would have made a different one. Dorbest Ltd. v. United States, 30 CIT 1671, 1676, 462 F.Supp.2d 1262, 1269 (2006); Goldlink Indus. v. United States, 30 CIT 616, 619, 431 F.Supp.2d 1323, 1327 (2006) (The court evaluates "whether a reasonable mind could conclude that Commerce chose the best available information.").
Plaintiff also argues that Commerce's surrogate value choice, based on WTA data, was "aberrational and distortive." Pl.'s Br. 11. As it did before the agency, Trust Chem asserts four considerations in support of this claim: (1) the extreme numerical differences between the WTA and Chemical Weekly data; (2) the low volume of nitric acid included in the WTA data; (3) the relationship between U.S. import data and the Chemical Weekly data; and (4) Commerce's decision in the original investigation and first administrative review of this order that other WTA data was aberrational. The court will consider each of these in turn.
Commerce notes that, under its current methodology, "higher prices alone [do] not necessarily indicate that the price data are distorted or misrepresentative, and thus [are] not sufficient to exclude a particular surrogate value." I & D Mem. Cmt. 4 at 14; see also Tapered Roller Bearings from the People's Republic of China, Issues & Decision Memorandum, A-570-601, ARP 07-08 (Dec. 28, 2009) [(adopted in 75 Fed. Reg. 844) (Dep't Commerce Jan. 6, 2010) (final results of the 2007-2008 administrative review of the antidumping duty order)] 18 ("TRBs from the PRC").
Commerce contends that under its practice, Trust Chem needed to provide "specific evidence" to show that the surrogate value was aberrational, but it failed to do so. I & D Mem. Cmt. 4 at 14. According to Commerce, a difference between WTA data and Chemical Weekly prices is insufficient proof that the WTA data is aberrational. Def.'s Br. 16; I & D Mem. Cmt. 4 at 14-16. Moreover, Commerce asserts that because Trust Chem did not provide data regarding the average unit values ("AUVs") for nitric acid for the other potential surrogate countries, Commerce did not have data to compare with the Indian WTA AUVs to determine if they were aberrational. I & D Mem. Cmt. 4 at 14-15.
The court will not disturb this aspect of Commerce's determination. While Plaintiff correctly notes the large discrepancy in price, the court agrees with Commerce that Plaintiff did not place sufficient comparative data on the record, such as data from other identified potential surrogate countries, to support its challenge based on numerical differences alone. Thus Commerce's decision not to place weight on the numerical differences between the WTA data and the Chemical Weekly data was not unreasonable.
Commerce counters that "small quantities of imports ... are not inherently" distortive. I & D Mem. Cmt. 4 at 15; see also Less-Than-Fair Value Investigation
In addressing Trust Chem's argument, Commerce states that the Indian import data the Petitioners put on the record showed that the POR import quantity (2008) was larger than the quantities for the years 2004-2007. Therefore, Commerce was not persuaded by Trust Chem's allegation regarding small import quantities. I & D Mem. Cmt. 4 at 16.
Notably, as Commerce points out, the question is whether the relative quantity of imports is distortive. Here, Plaintiff did not introduce evidence, for example, that the WTA volume was only a small fraction of India's domestic consumption. Def.'s Br. 18.
Commerce's current methodology, however, "no longer relies upon U.S. prices as an appropriate benchmark to determine whether surrogate values are aberrational." I & D Mem. Cmt. 4 at 15.
Plaintiff responds, citing the plain language of 19 U.S.C. § 1677b(c)(2).
Commerce disagrees, arguing that the statute "explicitly allows Commerce to use United States pricing data only when that data pertains to imports from countries of `comparable' economic development to China," as is delineated in § 1677b(c)(2)(B). Def.'s Br. 15. Commerce states that Trust Chem's claim that this import data was the only available data, and hence is the "best" information, is without merit because the statute provides that § 1677b(c)(2) is an exception to the best available information standard stated in § 1677b(c)(1). Commerce adds further that the statute does not require Commerce to use benchmarks, and thus Commerce was not obligated to use U.S. import data as a benchmark.
Commerce contends that its decision not to use the U.S. import data was consistent with both the plain language of the statute as well as the agency's established practice of rejecting U.S. import benchmark prices when the relevant imports do not originate from the designated surrogate countries [that are economically comparable to the NME at issue]. Id. at 13. Commerce contends that Trust Chem bore the burden of proving that the WTA surrogate value was aberrational by presenting data for the potential surrogate countries, and it failed to do so.
The court agrees with Commerce that section 1677b(c)(2) provides an exception for NME cases, applicable where there is available but inadequate information on the record. Ningbo Dafa Chemical Fiber Co. v. United States, 580 F.3d 1247, 1254 (Fed.Cir.2009). The exception allows Commerce to use pricing data pertaining to countries of comparable economic development to the country at issue. Zhengzhou Harmoni Spice Co. v. United States, ___ CIT ___, 617 F.Supp.2d 1281, 1290 (2009); Kerr-McGee Chemical Corp. v. United States, 185 F.3d 884, 1999 WL 89033, at *1 (Fed.Cir.1999). At the same time, there is no statutory prohibition on using U.S. or other market economy data to corroborate record evidence. Peer Bearing Co.-Changshan, 752 F.Supp.2d at 1372.
Nonetheless, Commerce adequately explained that "while in the past the Department has used U.S. prices to benchmark surrogate values, the Department's current practice has been to benchmark surrogate values against imports from the list of potential surrogate countries for a given case." Lined Paper Products from the PRC Cmt. 5 at 30.
Although there is no prohibition on using U.S. import data, Commerce's preference for data from potential surrogate countries was not unreasonable.
However, during this fourth administrative review, Commerce found the $10,474 USD/MT data, a number significantly higher than the calculation discarded in the earlier determination, to be the best available information for calculating normal value. Pl.'s Br. 15; see also Pl.'s Surrogate Value Sub. for Final Results Attach. 2, 20-21. To explain this deviation from its previous determination, Commerce argues that its "prior determination used a now-abandoned methodology that could not have been employed in this review." Def.'s Br. 15. Commerce claims that this new method is better aligned with the statute, and that altering its methodology is within Commerce's discretion. Id. 16.
Accordingly, relying on its "strong preference for comparing statistics from the same source[,]" I & D Mem. Cmt. 4 at 15; see also Lined Paper Products from the PRC at 30, Commerce asserts that it could not determine that its chosen value (based on WTA data) in the current review was aberrational because the sources of comparison (Chemical Weekly) for the values were not the same. I & D Mem. Cmt. 4 at 15.
Commerce's premise, however—that the sources are not the same—is a description, not an explanation. Moreover, in a previous determination that Commerce cited to in the I & D Mem., Commerce stated that, "[w]hile [it] agree[s] ... that it is preferable to benchmark selected surrogate values against AUVs derived from the same data source, for benchmarking purposes, where [Commerce] had insufficient data from one source, [it] also compared the AUVs derived from COMTRADE, CAPMAS, and the WTA data to each other. CAPMAS trade data are specific to Egypt, therefore, [Commerce] had to benchmark these against data from COMTRADE and
In addition, Plaintiff points out that Commerce's chosen surrogate value is "12 times higher than the inflated surrogate value [of $839.44 USD/MT] originally requested by the Petitioner[s] [Nation Ford Chemical and Sun Chemical]." Pl.'s Br. 18.
Consequently, the court cannot affirm Commerce's conclusion. Certainly, Commerce's new practice of comparing prices between countries of similar economic development is reasonable and is therefore entitled to deference. And, certainly a determination in one investigation is not binding in the subsequent reviews, as each determination is sui generis, consisting of a unique set of variables and relative factors, U.S. Steel Corp. v. United States, ___ CIT ___, 637 F.Supp.2d 1199, 1218 (2009); see also Nucor Corp. v. United States, 414 F.3d 1331, 1340 (Fed.Cir. 2005).
Nonetheless, Commerce's job is to compare the data on the record and provide an explanation that considers the important aspects of the problem presented. SKF USA, Inc. v. United States, 630 F.3d 1365, 1373-74 (Fed.Cir.2011) (stating that Commerce failed to comply with its State Farm obligation to provide an adequate explanation when its explanation failed to consider an important aspect of the problem). It has not done so here.
For all of the foregoing reasons, Plaintiff's Motion for Judgment on the Agency Record is granted in part. This matter is remanded for reconsideration and further explanation in accordance with this opinion.
Commerce shall have until October 3, 2011 to complete and file its remand redetermination. Plaintiffs shall have until November 2, 2011 to file comments. Defendant and Defendant-Intervenors shall have until November 17, 2011 to file any reply.
It is
Plaintiff points to the range of AUVs, from a low of $8,690 USD/MT to a high of $17,780 USD/MT, to demonstrate that such a variance is much less steady than the Chemical Weekly data, which shows much less disparity between surrogate values over the years. Pl.'s Br. 16-17; Pl.'s Reply 10; see also Pet'rs' Cmts. Ex. 3.
Defendant-Intervenors note that Plaintiff failed to demonstrate that the price was aberrational, and that the year-to-year fluctuations of Indian import values for nitric acid could in fact also be in line with "normal market forces." Def.-Int. Br. 6.
Defendant-Intervenors further contended during the proceedings below that Trust Chem's argument is "misleading" because Trust Chem did not explain what occurred during the intervening years since the original investigation in order to show that the price of nitric acid could not have risen, Pet'rs' Rebuttal Br. 2-4 (Feb. 3, 2010) (PR 43), citing increases in energy and petroleum prices and other factors affecting raw material prices. Def.-Int. Br. 6. Here, Defendant-Intervenors also reiterate Commerce's claim that Trust Chem failed to provide evidence that the WTA values were too high or that the WTA data could not be, as reported, based on accurate market conditions at the time these imports occurred. Id. at 3-5.
Certainly Commerce is correct that, unless an appropriate exception applies, a party is not entitled to judicial relief until it has exhausted its administrative remedies. 28 U.S.C.
§ 2637(d); see also Sandvik Steel Co. v. United States, 164 F.3d 596, 599 (Fed.Cir. 1998); see also Mittal Steel Point Lisas Ltd. v. United States, 548 F.3d 1375, 1383-84 (Fed. Cir.2008). In addition, as Commerce notes, by bringing up a general issue, a Plaintiff has not necessarily exhausted all specific issues under that general umbrella. Gerber Food (Yunnan) Co. v. United States, ___ CIT ___, 601 F.Supp.2d 1370, 1379 (2009).
The determinative question is whether Commerce was put on notice of the issue, not whether Plaintiff's exact wording below is used in the subsequent litigation. Here, Commerce was aware that Plaintiff was contesting the high surrogate value price of nitric acid. Moreover, the specific information upon which Plaintiff relies, having been submitted by the Petitioners, is necessarily before the agency. Thus, the argument is not barred by the doctrine of exhaustion of administrative remedies.
