Papierfabrik August Koehler SE v. United States , 997 F. Supp. 2d 1347 ( 2014 )

Slip Op. 14-89
UNITED STATES COURT OF INTERNATIONAL TRADE
________________________________
PAPIERFABRIK AUGUST KOEHLER SE, :
:
Plaintiff, :
: Before: Nicholas Tsoucalas,
v. : Senior Judge
:
UNITED STATES, : Court No.: 13-00163
:
Defendant, :
:
and :
:
APPLETON PAPERS INC., :
:
Defendant-Intervenor. :
OPINION and ORDER
[Defendant-intervenor’s motions to strike are denied.]
Dated: July 28, 2014
F. Amanda DeBusk, Matthew R. Nicely, John F. Wood, Eric S. Parnes,
Lynn G. Kamarck, and Alexandra B. Hess, Hughes Hubbard & Reed LLP,
of Washington, DC, for plaintiff.
Joshua E. Kurland, Trial Attorney, Commercial Litigation Branch,
Civil Division, U.S. Department of Justice, of Washington, DC, for
defendant. With him on the brief were Stuart F. Delery, Assistant
Attorney General, Jeanne E. Davidson, Director, and Reginald T.
Blades, Jr., Assistant Director. Of counsel on the brief was
Jessica M. Forton, Attorney, Office of the Chief Counsel for Trade
Enforcement and Compliance, U.S. Department of Commerce, of
Washington, DC.
Daniel L. Schneiderman and Gilbert B. Kaplan, King & Spalding LLP,
of Washington, DC, for defendant-intervenor.
Court No. 13-00163 Page 2
Tsoucalas, Senior Judge: Before the court are two
motions to strike filed by defendant-intervenor Appvion, Inc. 1
(“Appvion”). Appvion moves pursuant to USCIT Rule 12(f) to strike
certain information in plaintiff Papierfabrik August Koehler SE’s
(“Koehler”) reply brief and to strike the Notice of Supplemental
Authority Koehler filed on July 2, 2014, arguing that the contested
information in both documents was not on the administrative record
before defendant United States Department of Commerce (“Commerce”)
during the third administrative review (“AR3”) of lightweight
thermal paper (“LWTP”) from Germany. 2 See Def.-Int.’s Mot. to
Strike Information in Pl.’s Reply Br., ECF No. 106 (June 24, 2014)
(“First Motion to Strike”); Def.-Int.’s Mot. to Strike Pl.’s Notice
of Supplemental Auth., ECF No. 111 (July 7, 2014) (“Second Motion
to Strike”). Commerce supports Appvion’s motions. See Def.’s
Consolidated Resp. to Appvion’s Mot. to Strike and to Koehler’s
Notices of Supplemental Auth., ECF No. 114 at 1–2 (July 10, 2014).
Koehler opposes both of Appvion’s motions to strike. See Resp. to
Def.-Int.’s Mot. to Strike Information in Pl.’s Reply Br., ECF No.
108 at 1 (July 2, 2014); Resp. to Def.-Int.’s Mot. to Strike Pl.’s
Notice of Supplemental Auth., ECF No. 112 at 1–2 (July 9, 2014).
1 In May 2013, Appleton Papers Inc. changed its name to Appvion,
Inc. See Letter to Clerk of the Court, ECF No. 25 (June 21, 2013).
2 Koehler initiated the underlying case, Court No. 13-163, to
contest Commerce’s determination in AR3. See Complaint, ECF No.
6 (Apr. 24, 2013).
Court No. 13-00163 Page 3
Appvion’s First Motion to Strike concerns Koehler’s use
in its reply brief of home market sales data that Commerce rejected
as untimely during AR3 to estimate its dumping margin. 3 ECF No.
106 at 1. In the reply brief, Koehler argued that the adverse
facts available (“AFA”) rate Commerce selected was punitive and
supported its claim by comparing the AFA rate to the margin it
estimated using the rejected sales data. See Pl.’s Reply Br., ECF
No. 100 at 32–33 (June 13, 2014). Appvion insists that the court
must strike this information because Koehler “well knows” that the
home market data was not on the record of AR3 and, therefore,
Koehler’s repeated use of this information “can only be viewed as
an effort to confuse or mislead the [c]ourt.” ECF No. 106 at 1,
2. Koehler responds that its reliance on this information was
proper because it presented the home market sales data to Commerce
and Commerce retained that information on the record, despite
rejecting it as untimely. ECF No. 108 at 2.
Appvion’s Second Motion to Strike concerns Koehler’s
submission to the Court of the remand results of the second
administrative review of LWTP from Germany (“AR2 Remand”) as
3 Commerce rejected the home market sales data as untimely, but
retained it on the record in accordance with 19 C.F.R. §
351.104(a)(2). See Rejection of Factual Information Submission
Filed by Koehler at 1–2 (July 5, 2012). Section 351.104(a)(2)
provides that, in certain situations, Commerce will retain a copy
of a rejected document on the record “solely for purposes of
establishing and documenting the basis for rejecting the
document.” 19 C.F.R. § 351.104(a)(2)(ii).
Court No. 13-00163 Page 4
supplemental authority. ECF No. 111 at 1. Koehler submitted AR2
Remand because Commerce found that all of Koehler’s data on the
record of the second administrative review was unreliable and
applied total AFA. See Notice of Supplemental Auth., ECF No. 109
at 1 (July 2, 2014). According to Koehler, AR2 Remand undermines
Commerce’s use of transaction-specific dumping margins from the
second administrative review to corroborate the AFA rate in AR3.
Id. at 2. Appvion argues that striking this submission is
appropriate because Koehler introduces a new legal theory and new
information that was not on the record for AR3. ECF No. 111 at 2–
3. Koehler insists that the court should accept AR2 Remand as
supplemental authority because it supports its argument that
Commerce insufficiently corroborated the AFA rate and because
courts have taken judicial notice of subsequent agency decisions
in the past. See ECF No. 112 at 2–4.
“[M]otions to strike are generally disfavored or
extraordinary remedies.” Hynix Semiconductor, Inc. v. United
States, 27 CIT 1469, 1470 (2003) (internal quotation marks
omitted). “Nevertheless, this Court has broad discretion in
evaluating motions to strike . . . .” Id. The Court should grant
motions to strike “only in cases where there has been a flagrant
disregard of the rules of court[,]” and should deny motions to
strike “unless the brief demonstrates a lack of good faith, or
that the [C]ourt would be prejudiced or misled by the inclusion in
Court No. 13-00163 Page 5
the brief of the improper material.” Fla. Tomato Exch. v. United
States, 38 CIT __, __, 973 F. Supp. 2d 1334, 1338 (2014) (internal
citations omitted).
The court finds that it is unnecessary to strike either
the portions of Koehler’s reply brief relying on the rejected home
market sales data or the Notice of Supplemental Authority. As
noted above, motions to strike are “disfavored” remedies. Hynix,
27 CIT at 1470. Despite Appvion’s claims that Koehler included
the contested information to confuse or mislead the court, its
sole argument appears to be that the court cannot consider this
information because it was not on the record of AR3. This Court
has held, however, that “there is no occasion for a party to move
to strike portions of an opponent’s brief (unless they be
scandalous or defamatory) merely because he thinks they contain
material that is incorrect, inappropriate, or not a part of the
record.” Hynix, 27 CIT at 1470 (quoting Acciai Speciali Terni
S.P.A. v. United States, 24 CIT 1211, 1217, 120 F. Supp. 2d 1101,
1106 (2000)). Rather, “[t]he proper method of raising those issues
is by so arguing, either in the brief or in a supplemental
memorandum, but not by filing a motion to strike.” Id. (quoting
Acciai Speciali, 24 CIT at 1217, 120 F. Supp. 2d at 1106). The
court can address the issues on the merits as part of its decision
on Koehler’s motion for judgment on the agency record.
Court No. 13-00163 Page 6
Ultimately, Appvion’s conclusory statements that
Koehler’s reliance on the contested information demonstrates bad
faith, a flagrant disregard for the rules of court, or an attempt
to mislead the court are insufficient to warrant striking that
information. See Fla. Tomato Exch., 38 CIT at __, 973 F. Supp. 2d
at 1338. Appvion had less extreme means by which to contest
Koehler’s reliance on the information at issue. See Hynix, 27 CIT
at 1470. Accordingly, Appvion’s motions to strike are denied.
ORDER
Upon consideration of Defendant-Intervenor’s Motion to
Strike information in Plaintiff’s Reply Brief (ECF No. 106) and
Defendant-Intervenor’s Motion to Strike Plaintiff’s Notice of
Supplemental Authority (ECF No. 111), the responses to those
motions, and the papers and proceedings herein, it is hereby
ORDERED that Defendant-Intervenor’s Motion to Strike
Information in Plaintiff’s Reply Brief (ECF No. 106) is DENIED;
and it is further
ORDERED that Defendant-Intervenor’s Motion to Strike
Plaintiff’s Notice of Supplemental Authority (ECF No. 111) is
DENIED.
SO ORDERED.
/s/ Nicholas Tsoucalas
Nicholas Tsoucalas
Senior Judge
Dated: July 28, 2014
New York, New York