Bohler Bleche GmbH & Co. KG v. United States , 362 F. Supp. 3d 1377 ( 2019 )

Slip Op. 
UNITED STATES COURT OF INTERNATIONAL TRADE
BOHLER BLECHE GMBH & CO KG, et al.,
Plaintiffs,
v.
UNITED STATES, Before: Richard W. Goldberg, Senior Judge
Court No. 17-00163
Defendant,
and
NUCOR CORP. and SSAB ENTERPRISES
LLC,
Defendant-Intervenors.
OPINION AND ORDER
[Sustaining the Department of Commerce’s Final Results of Redetermination Pursuant to Court
Remand.]
Dated: February 1, 2019
David E. Bond and Ron Kendler, White and Case, LLP, of Washington, D.C., for
plaintiffs.
Vito S. Solitro, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, Chad A. Readler, Acting Assistant Attorney General, Tara K. Hogan,
Assistant Director, Jeanne E. Davidson, Director, and Nikki Kalbing, Office of the Chief Counsel
for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, D.C.,
for defendant.
Roger B. Shagrin and Paul W. Jameson, Schagrin Associates, and Alan H. Price and
Christopher B. Weld, Wiley Rein, LLP, of Washington, D.C., for defendant-intervenors.
Goldberg, Senior Judge: Before the court now are the Final Results of Redetermination
Pursuant to Court Remand, ECF No. 55 (Oct. 9, 2018) (“Remand Results”), issued by the
Department of Commerce (“the Department” or “Commerce”) in its antidumping duty
investigation of certain carbon and alloy steel cut-to-length plate from Austria. See Certain
Court No. 17-00163
Carbon and Alloy Steel Cut-to-Length Plate from Austria, 82 Fed. Reg. 16,366 (Dep’t
Commerce Apr. 4, 2017) (final determ.) (“Final Determination”), and accompanying Issues &
Decision Mem. (“I&D Mem.”). Plaintiffs Bohler Bleche GmbH & Co. KG, Bohler International
GmbH, voestalpine Grobblech GmbH, and voestalpine Steel & Service Center GmbH
(collectively, “Plaintiffs”) filed suit, challenging Commerce’s methodology for selecting foreign
like products. The court remanded the Final Determination to Commerce for further
proceedings. Bohler Bleche GMBH & Co. v. United States, 42 CIT __, 324 F. Supp. 3d 1344
(2018) (“Bohler I”). Commerce’s Remand Results now comply with the court’s remand order
and are supported by substantial evidence and in accordance with law; therefore, the
Department’s determination is sustained.
BACKGROUND
In its Final Determination, the Department designed a model-match methodology,
pursuant to 19 U.S.C. § 1677b(a)(1)(A), for the purposes of identifying suitable “foreign like
products” with which to compare the exported subject merchandise.1 Final Determination and
accompanying I&D Mem. As part of that process, Commerce created merchandise groups, each
assigned a control number (“CONNUM”), meant to group together “identical merchandise” used
to match home market sales with U.S. sales. The Department compared the weighted-average of
export sales within each CONNUM to the weighted-average of home market sales in that same
CONNUM. I&D Mem. cmt. 1. As part of this process, the Department created a hierarchy of
product characteristics, the third of which was QUALITY, which would be used for the purposes
of sorting merchandise based on various quality-related characteristics. Id.
1
The court previously sustained the Department’s determination that the model-match
methodology need not further account for process. Bohler I, 42 CIT at __, 324 F. Supp. 3d at
1354. Thus, the sole issue on remand was that surrounding the QUALITY and GRADE fields.
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Plaintiffs proposed their own methodology, called CONNUM2, “that replaced the
QUALITY field (which reported the type of steel and the chemical composition) with a GRADE
field (which reported the gross estimation of the cost of alloy).” Remand Results at 4 (citing
Pls.’ Questionnaire Resp. B-13–14 (July 15, 2016), P.R. 163–174). Alternatively, Plaintiffs
requested a number of changes to Commerce’s methodology, including that the QUALITY field
be placed first in the hierarchy, and that a QUALITY subcategory be added specifically for high
alloy tool steel products. I&D Mem. cmt. 1. In response, Commerce moved the QUALITY field
to first in the hierarchy. Id. Ultimately, Commerce’s methodology produced a weighted average
dumping margin of 53.72%, Final Determination, and Plaintiffs challenged those results.
On review, the court faulted Commerce’s determination for “fail[ing] to account for
commercially significant physical differences based on alloy content.” Bohler I, 42 CIT at __,
324 F. Supp. 3d at 1350. The court found that “Commerce’s methodology [could not] be
sustained because it allow[ed] subject merchandise to be cast as ‘identical’ to dubiously similar
foreign like products,” in contradiction of statute. Id., 42 CIT at __, 324 F. Supp. 3d at 1352
(citing 19 U.S.C. § 1677b(a)). What’s more, the court found that “[t]hroughout the investigation,
the Department largely ignored Plaintiffs’ central argument: that the Department’s methodology
allows comparisons of products with commercially distinct physical characteristics . . . to
determine whether” dumping occurred. Id. Therefore, the court disregarded Commerce’s
insistence that the challenges to the model-match methodology were untimely. Id. The court
found Commerce’s selected methodology unreasonable for insufficiently accounting for alloy
contents and remanded to the Department so that Commerce could “amend its model-match
methodology” so that a new model could be produced to differentiate between “similar” and
“identical” products. Id., 42 CIT at __, 324 F. Supp. 3d at 1354. Accordingly, Commerce was
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ordered to “design a model-match methodology in [its] investigation that accounts for all
commercially significant physical differences” and “apply recalculated dumping margins
consistent with its redetermination of its model-match methodology.” Id., 42 CIT at __, 324 F.
Supp. 3d at 1355.
On remand, the Department has now “reconsidered its model-match methodology” and
“intends to use [Plaintiffs’] proposed alternative model-match methodology (i.e., CONNUM2
which replaces the QUALITY field with a GRADE field) and to recalculate [Plaintiffs’]
dumping margins and the all-others rate.” Remand Results at 1–2. Commerce’s revised
methodology “replaced the QUALITY product characteristic field with a GRADE field to
account for all commercially significant differences, including alloy content.” Id. at 7. The
Department viewed Plaintiffs’ CONNUM2 proposal from the underlying investigation as the
only option that would “account for all commercially significant physical differences,” namely
alloy content. Id. at 9–10. This change resulted in a revised antidumping duty margin of
28.57%. Id. at 10.
In its comments on the Remand Results, Plaintiffs encourage the court to sustain
Commerce’s determination. They note that not only is the adoption of CONNUM2 reasonable,
“the Department has the discretion to choose any [reasonable] methodology.” Pls.’ Comments in
Support of the Final Results of Redetermination Pursuant to Court Remand 3, ECF No. 57 (Nov.
8, 2018). Commerce, on the other hand, issued the Remand Results under respectful protest, see
Remand Results at 2 (citing Viraj Grp., Ltd. v. United States, 343 F.3d 1371, 1376 (Fed. Cir.
2003)), maintaining its view that the court incorrectly determined that Plaintiffs “timely raised
[their] arguments concerning Commerce’s model-match methodology in [their] July 15, 2016,
questionnaire responses,” id. at 6.
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DISCUSSION
The court now sustains Commerce’s determinations as both: 1) based on an option in
conformance with the court’s prior order and 2) supported by substantial evidence and in
accordance with law. The Department’s altered methodology accounts for physical differences
based on alloy content and, per the court’s prior order, results in a reasonable determination.
Accordingly, Commerce’s Remand Results are sustained.
The statute requires that Commerce compare “[f]oreign like product[s],” defined either as
identical merchandise or similar merchandise, SKF USA, Inc. v. United States, 537 F.3d 1373,
1375 (Fed. Cir. 2008), in such a manner as to allow for a “fair comparison,” 19 U.S.C.
§ 1677b(a). While it is true that the Department’s prior methodology ran counter to the
directives of the statute, see Bohler I, 42 CIT at __, 324 F. Supp. 3d at 1352 (“Commerce’s
methodology cannot be sustained because it allows subject merchandise to be cast as ‘identical’
to dubiously similar foreign like products, when the statute plainly requires a different
approach.”), generally this court grants Commerce substantial discretion in its review of the
Department’s chosen model match methodology, SKF USA, Inc., 537 F.3d at 1379. Commerce’s
altered methodology not only differentiates between identical and similar products, it also
provides a reasonable basis for conducting a fair comparison. Whereas Commerce’s prior
methodology neither aligned with statutory directives nor resulted in fair comparisons, see
Bohler I, 42 CIT at __, 324 F. Supp. 3d at 1352, the methodology chosen on remand is
reasonable as it fairly compares commercially significant differences in physical characteristics.
Accordingly, the court finds the Department’s determination—that is, adopting
CONNUM2 and the resultant rate—to be reasonable as it is supported by substantial evidence
and in accordance with law.
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CONCLUSION
For the foregoing reasons, the court SUSTAINS Commerce’s determination in full and
enters judgment in the Department’s favor.
/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge
Dated: February 1, 2019
New York, New York
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