STANCEU, Chief Judge:
This consolidated action arose from a final determination (the "Final Results") that the U.S. Department of Commerce ("Commerce" or the "Department") issued in June 2013 to conclude the nineteenth periodic administrative review of an antidumping duty ("AD") order on circular welded non-alloy steel pipe ("subject merchandise") from the Republic of Korea ("Korea").
For the reasons discussed in this Opinion, the court denies relief on the claims brought by Husteel and Wheatland in this action and affirms the Final Results.
On December 30, 2011, Commerce initiated the nineteenth administrative review of the antidumping duty order on circular welded non-alloy steel pipe from Korea. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 76 Fed. Reg. 82,268 (Int'l Trade Admin. Dec. 30, 2011). Commerce selected for individual examination as "mandatory respondents" two Korean exporter/producers of subject merchandise, Husteel and Hyundai HYSCO ("HYSCO").
Commerce issued the preliminary results of the review ("Preliminary Results") on December 7, 2012, preliminarily assigning dumping margins of 6.54% to Husteel and zero to HYSCO. Prelim. Results, 77 Fed.Reg. at 73,016; Prelim. Decision Mem. for the Admin. Review of the Antidumping Duty Order on Circular Welded Non-Alloy Steel Pipe from the Republic of Korea, A-580-809, ARP 10-11, at 2 (Dec. 3, 2012) (Public Admin.R.Doc. No. 135), available at http://enforcement.trade.gov/ frn/summary/KOREA-SOUTH/2012-29635-1.pdf (last visited June 17, 2015) ("Prelim. Decision Mem.").
Husteel initiated this action challenging the Final Results by filing a summons and a complaint on July 8, 2013. Summons, ECF No. 1; Compl., ECF No. 6. Wheatland, a petitioner in the administrative review, initiated a separate action challenging the Final Results by filing a summons on July 11, 2013 and a complaint on August 7, 2013. Summons, ECF No. 1 (Ct. No. 13-00249); Compl. ¶¶ 2, 4, ECF No. 10 (Ct. No. 13-00249); Resp't Selection Mem. 1.
On August 22, 2013, the court granted a consent motion by United States Steel Corp. ("U.S. Steel Corp."), a domestic steel pipe producer and petitioner in the administrative review, to intervene as a plaintiff in Wheatland's action. Consent Mot. to Intervene as of Right as Pl.-Intervenor ¶ 2, ECF No. 15 (Court No. 13-00249); Order, ECF No. 21 (Court No. 13-00249) (granting motion); Resp't Selection Mem. 1. The court granted consent motions by Wheatland and U.S. Steel Corp. to intervene as defendants in Husteel's action. Order (July 12, 2013), ECF No. 18; Order (Aug. 6, 2013), ECF No. 24. The court also granted a consent motion by Husteel to intervene as a defendant in Wheatland's action. Order (Aug. 22, 2013), ECF No. 20 (Ct. No. 13-00249).
Husteel and Wheatland filed their motions for judgment on the agency record on December 23, 2013. Husteel's Mot. 1; Br. of Pl. Husteel Co., Ltd. in Supp. of its Mot. for J. upon the Agency R., ECF No. 36-1 ("Husteel's Br."); Wheatland's Mot. 1; Rule 56.2 Br. of Wheatland Tube Co. in Supp. of its Mot. for J. on the Agency R., ECF No. 38-1 ("Wheatland's Br."). Husteel and Wheatland filed responses opposing each other's motions. Resp. Br. of Pl. Husteel Co., Ltd. in Opp'n to Def.-Intervenor Wheatland Tube Co.'s Mot. for J. upon the Agency R. (Apr. 29, 2014), ECF No. 50; Resp. Br. of Wheatland Tube Co. in Opp'n to Husteel Co., Ltd.'s Mot. for J. on the Agency R. (Apr. 29, 2014), ECF No. 54. Defendant United States opposed both motions. Def.'s Resp. to Pls.' R. 56.2 Mots. for J. (Apr. 29, 2014), ECF No. 52. Husteel and Wheatland each filed a reply. Reply Br. of Pl. Husteel Co., Ltd. in Supp. of its Mot. for J. upon the Agency R. (June 24, 2014), ECF No. 63; Reply Br. of Wheatland Tube Co. in Supp. of its Mot. for J. on the Agency R. (June 24, 2014), ECF No. 64. Since intervening in this action, U.S. Steel Corp. has filed no motions or replies.
The court exercises jurisdiction according to section 201 of the Customs Court Act of 1980, 28 U.S.C. § 1581(c), under which the U.S. Court of International Trade is granted exclusive jurisdiction over actions brought under section 516A of the Tariff Act of 1930 ("Tariff Act"), 19 U.S.C. § 1516a.
Husteel's claim, in essence, is that: (1) the Final Results erroneously overstated Husteel's antidumping duty margin because Commerce used an uncorrected database that Husteel submitted on November 16, 2012 to report the sales of its merchandise in its home market; and (2) following Husteel's submission of ministerial error comments on June 12, 2013, Commerce should have issued amended final results assigning Husteel a margin based on a corrected home market database that Husteel submitted to Commerce on January 9, 2013 as a substitute for the November 16, 2012 database. Husteel maintains that its margin would have been reduced from the 3.99% rate in the Final Results to a rate below 1% had Commerce used the corrected database. Husteel's Br. 7 n. 2.
In its written decision of June 26, 2013, Commerce rejected the ministerial error comments on various grounds without deciding whether the Final Results actually were affected by errors as Husteel alleged. Dep't's Ministerial Error Resp. 1, 3. Among those grounds were that Husteel, during the review, failed to bring the alleged ministerial error to the Department's attention in accordance with the Department's regulations and otherwise failed to do so in a way that reasonably gave Commerce notice of the alleged problem. Id. at 3. The court denies relief on Husteel's claim because, as discussed below, Commerce acted within its discretion in refusing to issue amended final results in response to Husteel's ministerial error comments.
In subsection (h) of section 1675 of title 19, United States Code, which governs administrative reviews of antidumping duty orders, Commerce is directed to "establish procedures for the correction of ministerial errors in final determinations within a reasonable time after the determinations are issued under this section." 19 U.S.C. § 1675(h). The statute provides that "[s]uch procedures shall ensure opportunity for interested parties to present their views regarding any such errors" and further provides that "the term `ministerial error' includes errors in addition, subtraction, or other arithmetic function, clerical errors resulting from inaccurate copying, duplication, or the like, and any other type of unintentional error which [Commerce] considers ministerial." Id.
To implement § 1675(h), Commerce has promulgated regulations under which it
According to the Department's regulations, "[a] party to the proceeding to whom the Secretary has disclosed calculations performed in connection with a final determination or the final results of a review may submit comments concerning any ministerial error in such calculations." 19 C.F.R. § 351.224(c). In the ministerial error comments it filed on June 12, 2013, Husteel stated that it "has identified an error in the Department's Final Results that significantly overstates Husteel's final dumping margin." Husteel's Ministerial Error Comments 1. Husteel asserted that "the Final Results are not based on the final home market sales database ("hsthm04") submitted to the Department on January 9, 2013" and that the alleged error affected three-digit codes assigned to individual products identified by control number ("CONNUM") in the earlier-submitted database. Id. at 1-2. Husteel informed Commerce that, in the course of preparing its January 9, 2013 response to the Department's December 23, 2012 Third Supplemental Questionnaire, "Husteel discovered an error in the three digit code in field CONNUMH in the home market sales database" — "[s]pecifically, the code reported in the filed CONNUMH did not correspond to the same products in the U.S. and cost file." Id. at 2 (footnote omitted). Husteel added that "[t]he revised database Husteel submitted with the January [9] Supplemental Response corrected that error." Id. The significance of the use of the uncorrected database, according to Husteel's ministerial error comments, is that "[t]he use of the November 16, 2012 database has resulted in erroneous matches between the home market sales database and the U.S. sales and cost databases due to the error in the CONNUMH field." Id. at 3.
Neither the statute, in 19 U.S.C. § 1675(h), nor the implementing regulations, in 19 C.F.R. § 351.224, require Commerce
In § 351.224(c), the Department's regulations governing ministerial error allegations further provide that "[c]omments concerning ministerial errors made in the preliminary results of a review should be included in a party's case brief." 19 C.F.R. § 351.224(c). A related but more general provision in the Department's regulations, § 351.309(c)(2), addresses the contents of the case brief, which a party to an administrative review files with Commerce following publication of the preliminary results of the review. 19 C.F.R. § 351.309(c)(2). This latter provision directs that "[t]he case brief must present all arguments that continue in the submitter's view to be relevant to the Secretary's final determination or final results, including any arguments presented before the date of publication of the preliminary determination or preliminary results." Id.
In ruling on Husteel's ministerial error comments, Commerce concluded, inter alia, that Husteel had waived its argument that Commerce should have used the January 9, 2013 database in the Final Results instead of the database used for the Preliminary Results, which was the database Husteel submitted to Commerce on November 16, 2012. Dep't's Ministerial Error Resp. 3. Commerce found that Husteel had failed to raise the issue in its case brief as provided in 19 C.F.R. § 351.309(c)(2). Id. Based on record evidence, the effect of the Department's regulations addressing the content of a party's case brief, 19 C.F.R. § 351.309(c)(2) and the related provision, 19 C.F.R. § 351.224(e), and the way in which Husteel addressed the substitute database in its January 9, 2013 submission, the court concludes that Commerce acted within its discretion in refusing to issue amended final results in response to Husteel's ministerial error comments.
Record evidence supports the finding that Husteel did not raise the home market database issue in the case brief it filed with Commerce following the Preliminary Results of the review. Husteel does not dispute this finding but insists that it did not waive any argument or fail to comply with the Department's regulations. According to Husteel, "it was only in the Final Results that Husteel became aware that Commerce was not using the revised January 9 database that it submitted in response to Commerce's supplemental questionnaire issued after the preliminary results." Husteel's Br. 20. Husteel asserts that "[p]rior to the Final Results, Husteel had no reason to believe that there was any issue with respect to Commerce['s] using the revised database in the Final Results because Commerce accepted the response and never raised any issues regarding the timeliness of the submission." Id. In Husteel's view, the Department's use of the earlier database in the Preliminary Results was no longer an issue at the time Husteel filed its case brief
Husteel is correct that Commerce never raised an issue as to the untimeliness of Husteel's January 9, 2013 submission of the corrected database during the administrative review. The first time that Commerce characterized that submission as untimely-submitted new factual information was in its decision on Husteel's ministerial error comments, which Commerce issued after publishing the Final Results.
Husteel submitted the earlier database to Commerce on November 16, 2012, and Commerce published the Preliminary Results on December 7, 2012. Between the dates Husteel submitted the revised database, on January 9, 2013, and filed its case brief, on February 19, 2013, Commerce neither acknowledged receipt of the revised database nor notified Husteel that it would take any action in response. It was unreasonable for Husteel to presume, based on nothing more than the Department's
Pointing to the Department's regulations, 19 C.F.R. § 351.302(d), Husteel suggests that Commerce may not retain untimely-filed new factual information on the record unless Commerce extends the time period for filing. Husteel's Br. 18. Husteel argues that during the review Commerce acted contrary to the regulations in failing to notify the parties that it had deemed the information untimely and in failing to remove the information from the record. Id. This argument is not convincing.
Under the Department's regulations, the Secretary may extend filing deadlines to accept untimely-filed information but "will not consider or retain in the official record of the proceeding ... [u]ntimely filed factual information, written argument, or other material that the Secretary rejects," and the Secretary is directed not to consider or retain "unsolicited questionnaire responses...." 19 C.F.R. § 351.302(d). But the court cannot conclude that the regulations required Commerce, during the time between Husteel's January 9, 2013 submission of the questionnaire response and Husteel's February 19, 2013 filing of the case brief, to rule on the question of whether the revised home market database was properly part of the record.
Two considerations guide the court. First, Husteel submitted the revised database as unsolicited, non-germane information in response to a questionnaire, a method of submission the regulations did not permit. See 19 C.F.R. § 351.302(d). Second, as the record evidence demonstrates and as Commerce suggested in its written decision rejecting Husteel's ministerial error comments, Husteel's January 9, 2013 questionnaire response was inadequate to place Commerce on notice of the need for Commerce to make the substitution Husteel identifies. Dep't's Ministerial Error Resp. 3.
Husteel provided Commerce the revised database as part of a response to the sixth question in the Department's Third Supplemental Questionnaire. That question was as follows:
Third Supplemental Questionnaire to Husteel 3 (Dec. 12, 2012) (Public Admin.R.Doc. No. 144) ("Third Supplemental Questionnaire").
Husteel's Third Supplemental Questionnaire Resp. 11-12 (Jan. 9, 2013) (Public Admin.R.Doc. No. 153) (bold in original).
Id. at 12 n. 14. The first two sentences in Husteel's response to question six informed Commerce that the three errors Commerce identified did in fact exist in the reported information but that the errors had no effect on the margin calculation because the information items necessary to that calculation (the CONNUM and the reported theoretical weight for the sales in question) were correct as reported. From these two sentences Commerce reasonably could conclude that it had no need to take further action concerning the subject about which it had inquired in question six. Husteel's explanation in the third sentence, that it had included the outer diameter dimension "for reference only," id. at 11, reinforced this point, and the remainder of the text described Husteel's submission of corrections to the unnecessary information on outside diameter. Read in context, the fourth sentence ("Nonetheless, this error has been corrected in the revised home market sales database provided in
The court considers the Department's regulations sufficient to instruct a party not to wait until receiving the final calculation memoranda before bringing to the Department's attention an error affecting the preliminary results of the proceeding. In the situation this case presents, Husteel could not preserve the issue of which database Commerce should use in preparing the Final Results without timely raising that issue. According to its own statement on the record, Husteel discovered the error while preparing its response to the Third Supplemental Questionnaire, i.e., between December 12, 2012 and January 9, 2013. Husteel's Ministerial Error Comments 2. Not only did Husteel fail to raise the issue in the case brief it filed on February 19, 2013, it also failed to notify Commerce of the issue, in any other prompt and reasonable way, at any time before
In support of its Rule 56.2 motion, Husteel argues that Commerce erred in concluding that the use of the earlier-submitted database in the Final Results was intentional and therefore not a ministerial error. Husteel's Br. 13, 19 ("Commerce... cannot claim that it `intentionally' calculated Husteel's dumping margin in the Final Results using the CONNUMH that it was told by Husteel five-months earlier contained an error."); see Dep't's Ministerial Error Resp. 3 ("The Department's use of hsthm03 instead of hsthm04 was intential [sic] and does not constitute a ministerial error."). In the context of the entire response to the Husteel's ministerial error comments, the court construes the Department's statement that the use of the earlier database was intentional to mean that Commerce considered the error Husteel alleged not to qualify as "ministerial" within the meaning of 19 U.S.C. § 1675(h) because the alleged error was made by Husteel, not Commerce, and was not made apparent to the Department during the review.
The Court of Appeals for the Federal Circuit ("Court of Appeals") has opined that an error existing in information submitted by a party to a proceeding and relied upon by Commerce potentially could qualify as a "ministerial" error within the meaning of § 1675(h) if the error was, or should have been, apparent to Commerce. Alloy Piping Prods. v. Kanzen Tetzu Sdn. Bhd., 334 F.3d 1284, 1292-93 (Fed.Cir. 2003) ("Alloy Piping"). The Department's decision on Husteel's ministerial error comments indicates to the court that Commerce considered Husteel's January 9, 2013 response to the Third Supplemental Questionnaire insufficient to make the alleged errors apparent. Commerce concluded that "Husteel's January 9, 2013 responses to the Department's specific questions in the supplemental questionnaire would not have changed the data used to calculate the weighted-average dumping margin for Husteel from the preliminary results" and that "the footnote reference inadequately explained what changes were made to the newly submitted database." Dep't's Ministerial Error Resp. 3.
In addition to concluding that the alleged error was not "ministerial" within the meaning of the statute or its regulations, Commerce also concluded that Husteel had not raised its ministerial error allegation in accordance with the regulations. Id. As the court discussed previously, Commerce was justified in refusing to act favorably on Husteel's ministerial error comments because of the improper and unsatisfactory way Husteel brought the allegedly erroneous CONNUMH entries to the Department's attention. For this reason, it does not matter whether Commerce was correct or incorrect in concluding that the error Husteel alleged did not qualify as "ministerial" under the statute, and the court need not decide that question in order to rule on Husteel's claim. Here, it is sufficient for the court to conclude, as it does, that Commerce acted within its discretion in refusing to issue amended final results in response to Husteel's ministerial error comments. Husteel advances several
Husteel takes issue with the Department's reasoning that the substitute database Husteel submitted on January 9, 2013 was untimely-submitted new factual information. Husteel's Br. 14. Husteel argues that "[u]nder the facts of this case, Commerce's belated claim of untimeliness is nothing more than a post-hoc justification for its failure to use the final revised database that is not supported by the record or the law." Id. Specifically, Husteel submits that "... the record provides no support for Commerce's claim that the failure to use the January 9 database was intentional, let alone that Commerce had determined that submission contained untimely new factual information." Id. The court does not find merit in this argument. Although Commerce stated, in its response to Husteel's ministerial error comments, a conclusion that the January 9, 2013 submission of the substitute database constituted untimely-submitted new factual information, Commerce did not say it had reached that conclusion previously, i.e., during the review, and the record does not support an inference that Commerce did so. Stating its conclusion of untimeliness in the ministerial error response, Commerce found that Husteel neither identified the revised database clearly in its January 9, 2013 submission as new information nor requested that Commerce accept that database for the record despite expiration of the time for submission of new factual information. Dep't's Ministerial Error Resp. 3. The text of Husteel's response to question six of the Third Supplemental Questionnaire, which the court discussed above, supports the Department's decision. The inclusion of the revised database as non-germane information in the questionnaire response was neither permitted by the regulations nor adequately presented to Commerce as a proposed substitution essential to an accurately determined margin in the final phase of the review.
Husteel further argues that, if Commerce rejected the revised database submitted with the January 9, 2013 questionnaire response from the administrative record as untimely-filed new factual information, then Commerce violated its obligation under 19 U.S.C. § 1677m(f) to provide a written explanation for the rejection, and under 19 U.S.C. § 1677m(d), which required Commerce, "to the extent practicable", to notify Husteel of any deficiencies in its questionnaire response. Husteel's Br. 16-17. This argument fails because Commerce found no deficiency in the way Husteel responded to the Department's inquiry in the supplemental questionnaire, which did not seek resubmission of the database. See Third Supplemental Questionnaire 3 ("In several instances ... the calculated theoretical weight did not match the reported theoretical weight.... Please explain these discrepancies."); Ta Chen Stainless Steel Pipe, Inc. v. United States, 298 F.3d 1330, 1338 (Fed.Cir.2002) (stating that 19 U.S.C. § 1677m "only applies when a `response to a request' is deemed to not comply."). Husteel has not shown that Commerce failed to meet an obligation arising from § 1677m(d) or § 1677m(f).
Husteel notes that Commerce stated in the issues and decision memorandum accompanying the Final Results (the "Decision Memorandum") that Husteel's response to the supplemental questionnaire had been timely submitted. Husteel argues that the Department's statement in Decision Memorandum contradicts the Department's reasoning that the January 9, 2013 database was untimely-filed new information. Husteel's Br. 15-16 (citing Issues & Decision Mem. for the 2010-2011 Admin. Review of Circular Welded Non-Alloy Steel Pipe from the Republic of Korea, A-570-904, ARP 10-11, at 2 (June 5,
Husteel argues that Commerce was required to use the corrected database, citing Alloy Piping, 334 F.3d at 1292-93. Husteel's Br. 19. Relying on Borlem S.A.-Empreedimentos Industriais v. United States, 913 F.2d 933, 937 (Fed.Cir.1990) ("Borlem"), Husteel also argues that the court should not defer to a decision made by an administrative agency based on incorrect data. Id. at 19-20. Considering a situation in which an error was present in information reported to Commerce, the Court of Appeals opined in Alloy Piping that "in some instances, a respondent's error will be apparent from the face of Commerce's own final decision or from the calculations underlying that decision." Alloy Piping, 334 F.3d at 1292. In such circumstances the "error, in effect, becomes a government error and, hence, a `ministerial' error, and the government is required to correct it." Id. at 1293. In Alloy Piping, the Court of Appeals held that such a situation did not exist, concluding that the error in question was not apparent to Commerce during the administrative proceeding. Id. As discussed earlier in this Opinion, the court does not reach the question of whether the alleged error was, or was not, sufficiently apparent to qualify as a ministerial error under 19 U.S.C. § 1675(h) because Commerce, in either event, did not exceed its discretion in refusing to issue amended final results. As the court also discussed, Commerce was not properly or adequately informed during the review of the issue posed by the use of the home market database submitted in November 2012, which alone was a sufficient ground for the Department's decision not to act favorably on Husteel's ministerial error comments. Alloy Piping, therefore, does not establish a principle under which Husteel qualifies for a remedy on its ministerial error claim. Husteel's reliance on Borlem is also misplaced. In Borlem, the Court of Appeals considered decisive that the International Trade Commission reached a final determination in reliance on erroneous data that the Commission itself generated and acknowledged to be incorrect. Borlem, 913 F.2d at 937. That situation is not present in this case.
Citing certain decisions of this Court and noting that neither Commerce nor the petitioners objected to the submission of the revised database during the review, Husteel argues that it was not until filing its ministerial error comments that it had a full and fair opportunity to raise the issue addressed in the ministerial error comments. Husteel's Br. 21-23 (citing Calgon Carbon Corp. v. United States, 35 CIT ___, ___, Slip Op. 11-0021 at *11, 2011 WL 637605 (Feb. 17, 2011); LTV Steel Co. v. United States, 21 CIT 838, 868-69, 985 F.Supp. 95, 120 (1997); Qingdao Taifa Group Co. v. United States, 33 CIT 1090, 1093, 637 F.Supp.2d 1231, 1237 (2009); Saha Thai Steel Pipe Co. v. United States, 17 CIT 727, 729-30, 828 F.Supp. 57, 59-60 (1993)). But by no later than January 9, 2013, Husteel was aware of the issue posed by the Department's use of the November 16, 2012 database in the Preliminary Results. Husteel, therefore, had a full and fair opportunity to raise the issue, either in its case brief, which is the method of informing Commerce required by the regulations in such a circumstance, or in some other way that Commerce arguably could have found to suffice.
Citing Timken U.S. Corp. v. United States, 434 F.3d 1345, 1348 (Fed.Cir.2006)
Husteel is correct that, as the Court of Appeals stated in Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed.Cir.1990), Commerce has an overriding obligation to calculate antidumping duty margins as accurately as possible. Husteel's Br. 26, 29 (citing id. at 1191). In some circumstances, that obligation may require Commerce to waive its regulatory requirements on the timely submission of information. The difficulty in this case is that Husteel did not bring the alleged clerical errors to the Department's attention in any reasonable or permissible way during the review despite having had an adequate opportunity to do so. In directing Commerce to establish procedures for the correction of ministerial errors after issuance of the final results of an investigation or review, Congress established an exception to the general principle of finality. See 19 U.S.C. § 1675(h). In implementing this directive, Commerce placed reasonable regulations on the time and manner in which a party that is aware of a ministerial or other error affecting the preliminary results of a review must bring the error to the Department's attention in order to obtain remedial action. While Commerce has a general obligation to ensure the most accurate margin possible, it does not follow that a party failing to comply with regulations may obtain in any circumstance a ministerial error correction after a review is completed. Here, Husteel did not fulfill its own obligation to act promptly and reasonably to bring to the Department's attention a matter Husteel believed would affect the accuracy of the final margin.
Finally, Husteel argues that even absent the January 9, 2013 database, Commerce had a "readily available alternative" of using certain record information in the November 16, 2012 database, which Husteel had placed on the record prior to the Preliminary Results, to calculate an accurate margin. Husteel's Br. 29 (arguing that Commerce could have used "the CONNUM1H for purposes of matching Husteel's home market sales to the CONNUM1U and CONNUM1 reported in the U.S. and cost files, respectively"). This argument seems directed to a claim other than the one Husteel has brought in this case, which challenges the Department's rejection of Husteel's ministerial error comment submission. See Husteel's Br. 1. Husteel's ministerial error comment submission alleges as a ministerial error the Department's basing "the final results on
Wheatland challenges two aspects of the Final Results. First, Wheatland alleges that during the review Commerce impermissibly failed to respond to a submission that Wheatland filed to address the issue of "targeted dumping." Wheatland's Br. 5-6. Second, Wheatland contests the Department's decision to adopt certain "weight conversion factors" to convert the weight of merchandise as recorded in Husteel's cost database to the unit of measurement used to record weights in Husteel's home-market sales database. Wheatland's Br. 2. As discussed below, the court must reject both of Wheatland's claims and affirm the Department's determinations.
Wheatland claims that Commerce unlawfully issued the Final Results without responding to a submission Wheatland made to Commerce during the administrative review proceeding. Wheatland's Br. 5-6. Wheatland directed that submission, which consisted of a March 18, 2013 letter that Wheatland titled a "Notice of Supplemental Authority," to its allegation that the two mandatory respondents engaged in "targeted dumping." See Notice of Supplemental Authority 1-2 (Public Admin.R.Doc. No. 179) ("Notice of Supplemental Authority"). In the submission, Wheatland urged Commerce to apply a new methodology (the "differential pricing" methodology) to determine whether to calculate the respondents' margins on an "average-to-transaction" basis rather than according to the ordinary method, which determines a margin on an "average-to-average" basis.
Without responding to the Notice of Supplemental Authority and without applying the new differential pricing methodology to which Wheatland referred in its submission, Commerce calculated Husteel's final margin using the usual average-to-average method.
The background surrounding Wheatland's filing of the Notice of Supplemental Authority demonstrates the lack of merit in the claim Wheatland bases on that submission. During the nineteenth administrative review proceeding, Wheatland alleged targeted dumping and argued that Commerce should determine Husteel's and HYSCO's dumping margins using the average-to-transaction method rather than the normal average-to-average method. Wheatland Targeted Dumping Allegation (June 6, 2012) (Public Admin.R.Doc. No. 74). In the Preliminary Results, Commerce preliminarily determined that it would calculate both respondents' dumping margins using the average-to-average method after finding "that the pattern of [constructed export prices] for comparable merchandise that differ significantly among purchasers, regions or time periods does not exist for both HYSCO and Husteel...." Prelim. Decision Mem. 5. In a case brief responding to the Preliminary Results, submitted on February 19, 2013, Wheatland objected to the Department's targeted dumping analysis in the Preliminary Results, alleging that Commerce had not found targeted dumping "because the Department did not conduct its analysis by
In its Notice of Supplemental Authority, submitted to Commerce after the case briefs, Wheatland stated that "[a]s the Department is aware, Wheatland has argued that the Department should find targeted dumping (based on the then-existing Nails test) by the Korean respondents in this case and apply the alternative `average-to-transaction' margin calculation methodology."
In the Final Results, Commerce again found an absence of a pattern of sales that indicated targeted dumping for Husteel despite having reassessed the targeted dumping allegation based on the specific U.S. states as urged by Wheatland in its targeted dumping allegation.
Because the Xanthan Gum memorandum has not been placed on the administrative record, the court will draw no conclusions from any content therein. And because the memorandum is not a final agency decision issued in conjunction with published results of an administrative proceeding, it is not a document of which the court will consider taking judicial notice. At the same time, the fact that the Xanthan Gum memorandum is not a final decision of the Department to apply the differential pricing analysis — a fact apparent from the citation to the memorandum in the Notice of Supplemental Authority — also demonstrates that Wheatland may not rely on the Xanthan Gum memorandum for its claim that the memorandum established a change in the controlling law obligating Commerce to take action in the nineteenth review.
At oral argument, Wheatland also argued that a remand is appropriate because the Department's lack of response to or formal rejection of the Notice of Supplemental Authority violated the Department's obligation under 19 C.F.R. § 351.302(d)(2) to respond to or formally reject a submission of untimely argument. Oral Arg. Tr. 112 (Nov. 3, 2014), ECF No. 78-2. This argument is not properly before the court because Wheatland did not raise it in its Rule 56.2 brief. Regardless, the court sees no merit in the argument. The regulatory provision in question is
Wheatland claims that Commerce, when calculating Husteel's margin, erred in relying on certain "actual weight to theoretical weight conversion factors" that Husteel provided during the administrative review for individual products it produced and sold during the POR (identified by "control number," or "CONNUM"). Wheatland's Br. 2. Wheatland alleges that these weight conversion factors were "unreliable and distortive" and argues that Commerce instead should have used "facts otherwise available," see 19 U.S.C. § 1677e, as a substitute for the weight conversion factors. Id. Wheatland argues, further, that it appears that Husteel, in providing the conversion factors, attempted to manipulate its dumping margin. Id. at 7. The court finds no merit in Wheatland's claim.
According to Wheatland's argument, the weight conversion factors Husteel provided understated the cost of production for steel pipe Husteel sold in the home market of Korea and thereby reduced Husteel's dumping margin by preventing certain home market sales from being excluded from the home market sales database.
In deciding to use the conversion factors over objections Wheatland made during the review, Commerce reached several findings based on evidence in the administrative record. Wheatland advances a general argument that Commerce failed to address these objections adequately and failed to "support its decision with record evidence." Id. at 6-7. Contrary to Wheatland's argument, the court concludes that the record evidence supports the specific findings upon which Commerce concluded that the conversion factors were not distortive.
Commerce found that quantities in Husteel's home market sales database were recorded in units of "theoretical" metric tons while quantities reported in Husteel's cost-of-production database were recorded in units of "actual" metric tons.
As a threshold consideration, Commerce noted that Husteel's sales files were based on theoretical metric tons determined according to a formula Husteel described as an industry standard formula.
As to the cost data, Commerce found that "Husteel describes a system whereby the actual quantities reflect the actual measured weight of the input hot-rolled coil less the scrap generated during production." Id. at 36 (footnote omitted). Commerce added that "Husteel weighs samples of each type of pipe from each production run" and that "[t]he extension of the sample weights and number of pipes produced is compared to the input hot-rolled coil less scrap weight and any significant differences result in an adjustment in the recorded `actual' weight." Id. (footnote omitted). Commerce also found that Husteel itself relied on the "actual weights" determined according to this method for the cost accounting system by which it allocated costs to products. Id. Wheatland does not specifically contest any of the Department's findings related to Husteel's method of determining "actual" weights as recorded in Husteel's books and records.
Commerce next found that, based on the record evidence, "the pipe weights reported to the Department were taken directly from Husteel's normal production and cost accounting records." Id. Upon tracing the reported costs and quantities for selected products to Husteel's production and cost accounting records, Commerce found "no evidence to support that the actual weights reported to the Department were manipulated in order to shift costs between products" and "no inconsistencies in the manner in which the product weights were determined or in how costs were allocated between products." Id. Finally, Commerce found "no evidence to suggest that the company's normal books and records were manipulated to shift costs between products for the purpose of reporting to the Department." Id.
Commerce next considered Husteel's conversion factor formula, which Commerce described as "a ratio of the actual to theoretical POR production run weights for each CONNUM." Id. at 37 (footnote omitted). Commerce explained that Husteel had originally submitted a conversion factor formula with a numerator that "approximated but did not match the per-actual weight costs it was intended to convert" but that the conversion factors used in the Final Results have "a numerator
Before Commerce, Wheatland argued, inter alia, that Husteel's weighted-average conversion factor for matching CONNUMs is significantly lower that the weighted-average conversion factor for all CONNUMs, that "the only reason why certain CONNUMs have lower conversion factors is because they are matching CONNUMs," and that, therefore, "Husteel's proposed conversion factors represent an attempt" by Husteel "to manipulate its dumping margin." Final Decision Mem. 33. Wheatland advances essentially the same argument before the court. See Wheatland's Br. 7-8. In doing so, Wheatland contests the Department's ultimate decision to adopt Husteel's revised conversion factors without demonstrating that any of the specific factual findings upon which Commerce reached that decision were unsupported by substantial evidence. Rather than attempt to do so, Wheatland grounds its argument on a contention that during the review "Commerce failed to address Wheatland's argument" and that this failure "was not based on substantial evidence and not in accordance with law." Id. at 9. This contention is unfounded. Commerce addressed, and rejected, Wheatland's "manipulation" argument by finding that the actual and theoretical pipe weights reported by Husteel to Commerce were "consistently determined for all products," were "consistently applied in allocating costs to products," and "were taken directly from Husteel's normal production and cost accounting records." Final Decision Mem. 36. Commerce proceeded from these findings to conclude that the record evidence failed to support a finding that either the actual weights reported by Husteel or the company's normal books and records were manipulated in order to shift costs between products. Id. Commerce did not take issue with Wheatland's contention that Husteel's weighted-average conversion factor for matching CONNUMs was significantly lower that the weighted-average conversion factor for all CONNUMs, but it concluded, based on specific and supported findings, that this contention alone was insufficient to establish that Husteel either misreported data in its business records or designed conversion factors to manipulate its margin. The court finds no flaw in the Department's reasoning.
Wheatland next complains that Commerce "misstated Wheatland's argument"
The court will affirm the Final Results and the Department's decision not to amend those results in response to Husteel's ministerial error comments. Judgment will enter accordingly.
Commerce also disclosed various documents related to the preliminary calculation of Husteel's margin for the preliminary results of the review: Prelim. Results of the Antidumping Duty Admin. Review (Dec. 4, 2012) (Public Admin.R.Doc. No. 134); Prelim. Decision Mem. (Dec. 3, 2012) (Public Admin.R.Doc. No. 135); Prelim. Results Calculation Mem. for Husteel (Dec. 3, 2012) (Public Admin.R.Doc. No. 136) (Conf. Admin.R.Doc. No. 103); Cost of Prod. & Constructed Value Calculation Adjustments for the Prelim. Results — Husteel (Dec. 3, 2012) (Public Admin.R.Doc. No. 137) (Conf. Admin.R.Doc. No. 104); Prelim. Analysis of Comparison-Market Sales Program Log (Dec. 5, 2012) (Conf. Admin.R.Doc. No. 106); Prelim. Analysis of U.S. Sales Program Log (Dec. 5, 2012) (Conf. Admin.R.Doc. No. 105).
Antidumping Duty Admin. Review of Circular Welded Non-Alloy Steel Pipe from the Republic of Korea: Ministerial Error Comments Regarding Husteel Co., Ltd. 3 (June 26, 2013) (Public Admin.R.Doc. No. 207) ("Dep't's Ministerial Error Resp.").
The Department's regulations provide that Commerce ordinarily will determine whether subject merchandise is being sold at less than fair value by comparing the weighted average of normal values of subject merchandise with the weighted average of export prices (or constructed export prices) for comparable merchandise, i.e., the "average-to-average" method. 19 C.F.R. § 351.414(b)(1), (c)(1). Commerce, however, will compare the weighted average of normal values to export prices (or constructed export prices) of individual transactions for comparable merchandise (the average-to-transaction method) if the "Secretary determines another method is appropriate in a particular case." Id. § 351.414(c)(1). In the Decision Memorandum, Commerce explained that "[a]lthough section 777A(d)(1)(B) of the [Tariff] Act does not strictly govern our examination of this question in the context of an administrative review, we nevertheless find that the issue arising under 19 CFR 351.414(c)(1) in an administrative review is, in fact, analogous to the issue in investigations." Issues & Decision Mem. for the 2010-2011 Admin. Review of Circular Welded Non-Alloy Steel Pipe from the Republic of Korea, A-570-904, ARP 10-11, at 6 (June 5, 2013) (Public Admin.R.Doc. No. 208), available at http://enforcement. trade.gov/frn/summary/korea-south/2013-13989-1.pdf (last visited June 17, 2015) ("Final Decision Mem.").
