Ceramark Technology, Inc. v. United States , 11 F. Supp. 3d 1317 ( 2014 )

Slip Op. 14 -
UNITED STATES COURT OF INTERNATIONAL TRADE
CERAMARK TECHNOLOGY, INC.
Plaintiff,
v.
Before: Donald C. Pogue,
UNITED STATES, Senior Judge
Defendant, Court No. 13-00357
and
SGL CARBON LLC and
SUPERIOR GRAPHITE CO.,
Defendant-Intervenors.
OPINION
[final determination of circumvention affirmed in part and
remanded in part]
Dated:
Brian W. Stolarz and Katherine A. Calogero, Jackson
Kelly PLLC, of Washington, DC, for the Plaintiff.
Alexander V. Sverdlov, Trial Attorney, Commercial
Litigation Branch, Civil Division, U.S. Department of Justice,
of Washington, DC, for the Defendant. Also on the brief were
Stuart F. Delery, Assistant Attorney General, Jeanne E.
Davidson, Director, and Claudia Burke, Assistant Director. Of
counsel was Jessica M. Forton, Attorney, Office of the Chief
Counsel for Trade Enforcement and Compliance, U.S. Department of
Commerce, of Washington, DC.
Mary T. Staley and Katherine E. Wang, Kelley Drye &
Warren LLP, of Washington, DC, for the Defendant-Intervenors.
Pogue, Senior Judge: In this action, Plaintiff,
Ceramark Technology, Inc. (“Ceramark”) challenges the
affirmative final determination of circumvention of an
Court No. 13-00357 Page 2
antidumping duty order.1 Compl., ECF No. 9 at ¶2. In that
determination, the Department of Commerce (“Commerce”) found
that 17 inch diameter graphite electrodes (which Ceramark
imports) constitute merchandise altered in form or appearance in
such minor respects that it was properly subject to the
antidumping duty order for graphite electrodes 16 inches or
smaller in diameter.2. Plaintiff claims that Commerce’s
determination is neither in accordance with law nor supported by
substantial evidence. Rule 56.2 Mot. for J. on the Agency R. on
behalf of Pl. Ceramark Tech., Inc., ECF No. 25 (“Rule 56.2
Mot.”).
Plaintiff is correct in part: Because Commerce failed
to base its determination on a reasonable reading of the record
evidence in context, its determination is not supported by
substantial evidence. The court remands for further
consideration in accordance with this opinion.
1
Small Diameter Graphite Electrodes From the People’s Republic
of China, 78 Fed. Reg. 56,864 (Dep’t Commerce Sept. 16, 2013)
(affirmative final determination of circumvention of the
antidumping duty order and rescission of later-developed
merchandise anticircumvention inquiry) (“Circumvention Final
Determination”) and accompanying Issues & Decision Memorandum,
A-570-929 (Sept. 10, 2013) (“I&D Mem.”).
2
Circumvention Final Determination, 78 Fed. Reg. at 56,865. See
Small Diameter Graphite Electrodes from the People’s Republic of
China, 74 Fed. Reg. 8775 (Dep’t Commerce Feb. 26, 2009)
(antidumping duty order) (“AD Order”).
Court No. 13-00357 Page 3
BACKGROUND
I. Antidumping Duty Determination and Order
This action derives from a petition by SGL Carbon LLC
and Superior Graphite Co. (“Petitioners” or “Defendant-
Intervenors”) alleging that imports of small diameter graphite
electrodes (“SDGE”) from the People’s Republic of China (“PRC”
or “China”) were being dumped in the United States. [SDGE] from
the [PRC], 73 Fed. Reg. 8287 (Dep’t Commerce Feb. 13, 2008)
(initiation of antidumping duty investigation) (“AD Initiation
Notice”).
Commerce, having conferred with Defendant-Intervenors
to ensure an accurate scope definition reflective of the
domestic industry’s concerns, limited its investigation to “all
[SDGE] of any length, whether or not finished, of a kind used in
furnaces, with a nominal or actual diameter of 400 millimeters
(16 inches) or less, and whether or not attached to a graphite
pin joining system or any other type of joining system or
hardware.” Id. at 8287.3 Commerce made a final affirmative
determination of sales at less than fair value based on this
scope definition. [SDGE] from the [PRC], 74 Fed. Reg. 2049, 2050
(Dep’t Commerce Jan. 14, 2009) (final determination of sales at
3
See also Def.’s Resp. to Pl.’s Mot. for J. on the Admin. R.,
ECF No. 38 (“Def.’s Resp.”) at 2 (noting that Petitioners and
subsequently Commerce defined the desired scope of the
investigation in this way).
Court No. 13-00357 Page 4
less than fair value and affirmative determination of critical
circumstances) (“AD Final Determination”). The International
Trade Commission (“ITC”) similarly made a final affirmative
determination of material injury to U.S. industry within this
scope definition. [SDGE] from China, USITC Pub. 4062,
Inv. No. 731-TA-1143 (Feb. 2009) (“ITC Final Determination”) at
6, 9-10.4 Drawing on the arguments of the domestic industry, the
ITC found “a clear dividing line between [small diameter and
large diameter graphite electrodes],” and defined the threatened
domestic product as “coextensive with the scope” of Commerce’s
antidumping duty determination. Id. at 10.
Based on the final affirmative determinations of
Commerce and the ITC, Commerce issued an antidumping duty order
on SDGE from the PRC. AD Order, 74 Fed. Reg. at 8775. Commerce
again used the same scope definition, with the dividing line
between small and large diameter graphite electrodes explicitly
and unambiguously specified at 16 inches. Id.
II. Circumvention Investigation and Determination
Several years later, at the request of Defendant-
Intervenors, Commerce investigated whether imports of graphite
4
The ITC notes that, again, Petitioners argued that the ITC
“should find one like product consisting of SDGE, coextensive
with Commerce’s scope. They stress that there are pronounced
differences between SDGE and [large diameter graphite
electrodes].” Id. at 6.
Court No. 13-00357 Page 5
electrodes larger than 16 inches but smaller than 18 inches in
diameter were being used to circumvent the antidumping duty
order on SDGE. [SDGE] from the [PRC], 77 Fed. Reg. 37,873 (Dep’t
Commerce June 25, 2012) (initiation of anticircumvention
inquiry) (“Circumvention Initiation Notice”).5 Commerce issued
5
Defendant-Intervenors challenged pursuant to §§ 781(c)-(d) of
the Tariff Act of 1930, as amended, 19 U.S.C. § 1677j(c) (2012)
(the minor alterations provision) and 19 U.S.C. § 1677j(d)
(2012) (the later developed merchandise provision). (All
further citations to the Tariff Act of 1930, as amended, are to
Title 19 of the U.S. Code, 2012 edition, unless otherwise
noted.) The merchandise subject to the inquiry were graphite
electrodes from the PRC produced and/or exported by Sinosteel
Jilin Carbon Co., Ltd. and Jilin Carbon Import and Export
Company (“Jilin Carbon” collectively), Beijing Fangda Carbon-
Tech Co., Ltd. and Fangda Carbon New Material Co., Ltd.(“Fangda
Carbon” collectively), and Fushun Jinly Petrochemical Carbon
(“Fushun Jinly”), with diameters larger than 16 inches but
smaller than 18 inches and otherwise meeting the definition of
the scope of the antidumping duty order. See Circumvention
Initiation Notice, 77 Fed. Reg. at 37,874 n.7, 37,875-76.
Commerce sent questionnaires to the above companies, along with
all companies identified in the Comprehensive Service List for
Scope Inquiries and the Government of the PRC. [SDGE] from the
[PRC], Preliminary Analysis Mem., A-570-929 circumvention
Inquiry (Apr. 11, 2013) (adopted in 78 Fed. Reg. 22,843 (Dep’t
Commerce Apr. 17, 2013) (affirmative preliminary determination
of circumvention of the antidumping duty order and intent to
rescind later-developed merchandise circumvention inquiry)
(“Circumvention Prelim. Determination”)) reproduced in App. to
Def.’s Resp., ECF No. 44 at Tab 6 (“Circumvention Prelim. Mem.”)
at 2. Fangda Carbon and Fushun Jinly responded that neither
they nor their affiliates produced or sold graphite electrodes
matching the anticircumvention description. Id. Jilin Carbon
responded that it produced and exported graphite electrodes with
17 inch diameters. See Id. at 2-3. Plaintiff, Ceramark,
identified itself as an importer of those electrodes. Id. at 3.
No one else responded. Id. at 2. Commerce accordingly limited
the application of its affirmative determination to 17 inch
diameter graphite electrodes produced and/or exported by Jilin
(footnote continued)
Court No. 13-00357 Page 6
an affirmative determination of circumvention, finding that 17
inch graphite electrodes constituted a product altered in form
or appearance in such minor respects that it should be included
with the scope of the SDGE order pursuant to 19 U.S.C.
§ 1677j(c). Circumvention Final Determination, 78 Fed. Reg.
at 56,864-65.6 Plaintiff now challenges this determination. Rule
56.2 Mot., ECF No. 25; Mem. of Points & Authorities in Supp. of
Pl.’s [Rule 56.2 Mot.], ECF No. 25-1 at 9.
STANDARD OF REVIEW
The court has jurisdiction pursuant to
28 U.S.C. § 1581(c) (2012) and will therefore uphold Commerce’s
final affirmative anticircumvention determination unless it is
“unsupported by substantial evidence on the record, or otherwise
not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i).
Substantial evidence is “such relevant evidence as a reasonable
mind might accept as adequate to support a conclusion.”
Universal Camera Corp. v. NLRB, 340 U.S. 474, 477 (1951)
Carbon, as it had no record evidence of any other producer or
product. Id. at 3-4; Circumvention Prelim. Determination, 78
Fed. Reg. at 22,844 (unchanged in Circumvention Final
Determination, 78 Fed. Reg. at 56,865).
6
Having found circumvention under 19 U.S.C. § 1677j(c), Commerce
found it unnecessary to determine whether later developed
merchandise was circumventing the SDGE antidumping duty order
under 19 U.S.C. § 1677j(d). Id. at 56,865. Plaintiff does not
contest Commerce’s decision not to pursue Petitioner’s 19
U.S.C. § 1677j(d) inquiry.
Court No. 13-00357 Page 7
(quoting Consol. Edison Co. of New York v. N.L.R.B., 305 U.S.
197, 229 (1938)). Substantial evidence review requires
consideration of “the record as a whole, including any evidence
that fairly detracts from the substantiality of the evidence,”
Gallant Ocean (Thailand) Co. v. United States, 602 F.3d 1319,
1323 (Fed. Cir. 2010) (internal quotation marks and citation
omitted), and asks, in light of that evidence, whether
Commerce’s determination was reasonable. Nippon Steel Corp. v.
United States, 458 F.3d 1345, 1351 (Fed. Cir. 2006).7
DISCUSSION
I. Antidumping Duty Order Scope and Circumvention
In questions of scope, the language of the antidumping
duty order is “the cornerstone of our analysis.” Duferco Steel,
Inc. v. United States, 296 F.3d 1087, 1097 (Fed. Cir. 2002).
When the language is ambiguous in application, Commerce may
interpret or clarify the order, 19 C.F.R. § 351.225(a),8 and the
7
See also Fuwei Films (Shandong) Co., Ltd. v. United States,
__ CIT __, 837 F. Supp. 2d 1347, 1350 (2012) (“Fundamentally,
though, ‘substantial evidence’ is best understood as a word
formula connoting reasonableness review.”) (citing 3 Charles H.
Koch, Jr., Administrative Law and Practice § 9.24[1] (3d. ed.
2011).
8
See also Tak Fat Trading Co. v. United States, 396 F.3d 1378,
1382 (Fed. Cir. 2005) (“After investigation, Commerce will issue
an antidumping order if merchandise has been sold at less than
fair value. After an order is published, scope rulings may be
necessary when producers . . . need clarification as to the
status of their products under the order.”).
Court No. 13-00357 Page 8
court will grant “significant deference” to Commerce’s
interpretation. Duferco Steel, 296 F.3d at 1094-95 (citation
omitted). It follows that, when circumvention “seriously
undermine[s] the effectiveness of the remedies provided” by the
antidumping duty regime, S. Rep. No. 100-71, at 101 (1987)
(legislative history of 19 U.S.C. § 1677j), Commerce may
determine that a product in the penumbra of an order, outside
the literal scope of its language, is covered by that order. 19
U.S.C. § 1677j.9 Nevertheless, Commerce cannot change the order
or interpret it “in a way contrary to [its] terms.” Wheatland
Tube Co. v. United States, 161 F.3d 1365, 1370 (Fed. Cir. 1998)
(quoting Smith Corona Corp. v. United States, 915 F.2d 683, 686
(Fed. Cir. 1990)).10
II. Commerce’s Minor Alteration Analytic Method
With a finding of circumvention, Commerce may include
a product “altered in form or appearance in minor respects”
9
Circumvention takes two forms, either a product’s country of
origin has been manipulated (merchandise completed or assembled
in the United States and merchandise completed or assembled in
other foreign countries), or the product itself has been
manipulated (minor alteration of merchandise or later-developed
merchandise). 19 U.S.C. §§ 1677j(a)-(d); 19 C.F.R.
§§ 351.225(g)-(j).
10
See also Ericsson GE Mobile Commc’ns, Inc. v. United States,
60 F.3d 778, 782 (Fed. Cir. 1995) (“The Commerce Department
enjoys substantial freedom to interpret and clarify its
antidumping duty orders. But while it may interpret those
orders, it may not change them.”) (citation omitted).
Court No. 13-00357 Page 9
within the scope of an antidumping duty order, 19 U.S.C.
§ 1677j(c), even if that product “might otherwise fall outside
the literal scope of the order.” Target Corp. v. United States,
609 F.3d 1352, 1362 (Fed. Cir. 2010) (emphasis omitted) (relying
on Wheatland Tube, 161 F. 3d at 1371).11
The statute is silent with regard to what factors
Commerce should consider when determining whether an alteration
is minor. Commerce’s practice is to analyze five factors12
provided in the statute’s legislative history (the Senate Report
Criteria). Circumvention Prelim. Mem. at 5; I&D Mem. cmt. 1 at
10. Because the Senate Report Criteria may be insufficient for
analysis of any given case,13 Commerce will also consider
additional context-specific criteria. Circumvention Prelim. Mem.
11
See also Nippon Steel Corp. v. United States, 219 F.3d 1348,
1349 (Fed. Cir. 2000) (finding that a minor alteration inquiry
is not ultra vires even when products are expressly and
unambiguously excluded from an order).
12
These five factors are: “[1] the overall physical
characteristics of the merchandise, [2] the expectations of the
ultimate users, [3] the use of the merchandise, [4] the channels
of marketing[,] and [5] the cost of any modification relative to
the total value of the imported product.” S. Rep. No. 100-71, at
100; Circumvention Prelim. Mem. at 5. For the application of
this test to the instant case, see Circumvention Prelim. Mem. at
8-16.
13
The Senate Report indicates that the list is non-exhaustive.
S. Rep. No. 100-71, at 100.
Court No. 13-00357 Page 10
at 5.14 This approach is in keeping with the Senate’s directive
that Commerce “apply practical measurements regarding minor
alterations, so that circumvention can be dealt with
effectively,” S. Rep. No. 100-71, at 100, and with “Commerce’s
duty to determine margins as accurately as possible, and to use
the best information available to it in doing so.” Lasko Metal
Prods., Inc. v. United States, 43 F.3d 1442, 1443 (Fed. Cir.
1994).
As Commerce’s choice of factors is based on the
relevant statutory language and legislative history, its minor
alterations analytic method cannot be per se unreasonable.15
Rather, it is in accordance with law.
14
Here, Commerce has considered: (1) the circumstances under
which the products entered the United States; (2) the timing of
entries; and (3) the quantity of merchandise entered.
Circumvention Prelim. Mem. at 16.
15
Because the statute does not “directly address the precise
question at issue,” the court is left to decide whether
Commerce’s choice of factors is based on “a reasonable
construction of the statute.” Yangzhou Bestpak Gifts & Crafts
Co. v. United States, 716 F.3d 1370, 1377 (Fed. Cir. 2013)
(citing Chevron, U.S.A., Inc. v. Natural Res. Def. Council,
Inc., 467 U.S. 837, 842-43 (1984)), and will consider “the
express terms of the provision[] at issue, the objectives of
[the] provision[], and the objectives of the antidumping scheme
as a whole.” Wheatland Tube Co. v. United States, 495 F. 3d
1355, 1361 (Fed. Cir. 2007) (quoting NSK Ltd. v. United States,
26 CIT 650, 654, 217 F. Supp. 2d 1291, 1297 (2002)).
Court No. 13-00357 Page 11
III. Commerce’s Minor Alteration Analytic Method in Application
While Commerce’s analytic method is not per se
unreasonable, circumvention is an inherently factual
determination16 and therefore must be supported by substantial
evidence. 19 U.S.C. § 1516a(b)(1)(B)(i).
In a minor alterations inquiry, whatever tests are
derived and devised, whatever factors are considered,
substantial evidence requires review of the record as a whole,
including evidence contrary to Commerce’s determination, and a
finding that, given all the evidence, Commerce has still acted
reasonably. Gallant Ocean, 602 F.3d at 1323; Nippon Steel,
458 F.3d at 1351. A minor alteration must be minor. It must be
insignificant.17 It cannot make the product materially different
16
See Certain Cut-to-Length Carbon Steel Plate from the [PRC],
74 Fed. Reg. 33,991, 33,992 (Dep’t Commerce July 14, 2009)
(affirmative preliminary determination of circumvention of the
antidumping duty order) (“Each circumvention case is highly
dependent on the facts on the record, and must be analyzed in
light of those specific facts.”), unchanged in 74 Fed. Reg.
40,565, 40,566 (Dept. Commerce Aug. 12, 2009) (affirmative final
determination of circumvention of the antidumping duty order).
17
Commerce, in dismissing this requirement, would suggest that
it is merely the Plaintiff’s construction of the statute, see
I&D Mem. at 10 (“[W]e disagree with Ceramark’s construction of
the statute (i.e., that the minor alteration must be
‘insignificant’).”). This is incorrect. It is the Federal
Circuit’s construction of the statute. See Wheatland Tube, 161
F.3d at 1371 (“In essence, section 1677j(c) includes within the
scope of an antidumping duty order products that are so
insignificantly changed from a covered product that they should
be considered within the scope of the order even though the
(footnote continued)
Court No. 13-00357 Page 12
from that specified in the order’s scope. Wheatland Tube, 161
F.3d at 1371. Otherwise, Commerce would be able to use
circumvention to change an order or read it contrary to its
terms, and the minor alteration inquiry would upend “the purpose
of the antidumping laws” by “allow[ing] Commerce to assess
antidumping duties on products intentionally omitted from the
ITC’s injury investigation.” Wheatland Tube, 161 F. 3d at 1370-
71.18 Commerce’s “total failure to consider or discuss record
evidence which, on its face, provides significant support for an
alternative conclusion renders [a determination] unsupported by
substantial evidence.” Allegheny Ludlum Corp. v. United States,
24 CIT 452, 479, 112 F. Supp. 2d 1141, 1165 (2000) (citations
omitted).
Here, Commerce has either ignored or dismissed record
evidence that, on its face, indicates that the alteration at
issue – a one inch increase in graphite electrode diameter – is
neither minor nor an alteration. Specifically: Commerce has not
reasonably considered the prior commercial availability of the
alterations remove them from the order's literal scope.”)
(citations omitted).
18
It would “also indirectly encourage manipulation of the
antidumping duty process” by incentivizing petitioners to
“narrowly define subject merchandise” to get a positive injury
determination, and “later broaden an order’s reach through use
of a minor alteration inquiry. Congress could not have intended
this result.” Deacero S.A. de C.V. v. United States, __ CIT __,
942 F. Supp. 2d 1321, 1332 n.6 (2013) (“Deacero I”).
Court No. 13-00357 Page 13
product.19 See, e.g., Ceramark Initial Questionnaire Resp.,
A-570-929 Anticircumvention Inquiry (Aug. 3 2012), reproduced in
Pub. App. to Mem. of Points of Authorities in Supp. of Pl.’s
Rule 56.2 Mot. for J. on the Agency R. (“Pub. App. to Rule 56.2
Mot.”), ECF No. 28-2 at Tab 2, at 3 (citing Exs. 1 & 2 to id.,respectively [Nat’l Elec. Mfrs. Ass’n (“NEMA”)] Standards
Publication Nos. CG 1-1993: Manufactured Graphite/ Carbon
Elecrtrodes (Jan. 26, 1993) at 2, 8; NEMA Standards Publication
No. CG 1-2001: Manufactured Graphite/ Carbon Elecrtrodes (2002)
at 7); Jilin Carbon Initial Questionnaire Resp., A-570-929
Anticircumvention Inquiry (July 25, 2012) (“Jilin Resp.”),
reproduced in Pub. App. to Rule 56.2 Mot., ECF No. 28-5 at Tab
5, at 2, 8, 11-12 (citing same 1993 and 2001 NEMA standards);
Ceramark’s 1st Supp. Questionnaire Resp., A-570-929
Anticircumvention Inquiry (Oct. 17, 2012) (“Ceramark’s Supp.
Resp.”), reproduced in Pub. App. to Rule 56.2 Mot., ECF No. 28-7
19
Commerce declined to make finding as to whether 17 inch
graphite electrodes were commercially available prior to the
order. Instead, Commerce reasoned that the prior existence of a
product “does not preclude the Department from conducting a
minor alterations anticircumvention analysis,” and therefore has
“no relevance” to the minor alteration inquiry. I&D Mem. cmt. 1
at 11 (citation omitted). The first is correct, but the second
does not follow. There is a difference between not precluding
and having no relevance. An alternate product is not
necessarily the same as an altered product, see Hysla v. United
States, 22 CIT 44, 48-49 (1998) (not reported in the Federal
Supplement), and prior existence, while not dispositive, may
help distinguish between the two.
Court No. 13-00357 Page 14
at Tab 7, at 6-7. Commerce also has not considered the
importance of diameter as a defining characteristic of graphite
electrodes. See, e.g., Ceramark’s Supp. Resp., ECF No. 28-7 at
Tab 7, at 2-6; Jilin Resp., ECF No. 28-5 at Tab 5, at 8-13.
Moreover, Commerce has not considered the choice made by
Defendant-Intervenors (the original petitioners in the
antidumping duty investigation), its own corresponding choice,
and the ITC’s decision to explicitly and unambiguously exclude20
17 inch graphite electrodes from the SDGE antidumping duty
20
Defendant-Intervenors argue that even when “the scope
descriptor in question is a number,” it “does not make a clear
and unambiguous exclusion because Commerce has an appropriate
practice of looking behind numeric descriptors to determine the
meaning of the scope language.” Resp. Br. of Def.-Intervenors
SGL Carbon LLC & Superior Graphite Co., ECF No. 40 (“Def.-
Intervenor Resp. Br.”) at 31. They cite Certain Pasta from
Italy, 64 Fed. Reg. 43,152, 43,153 (Dept. Commerce Aug. 9, 1999)
(notice of preliminary results and partial rescission of
antidumping duty administrative review) in support. Id. In
Certain Pasta from Italy, however, the scope of the order was
broadened to accommodate “allowable industry tolerances,” not,
as here, differences in nominal diameter. Certain Pasta from
Italy, 64 Fed. Reg. at 43,153. Cf. NEMA Standards Publication
No. CG 1-2001: Manufactured Graphite/ Carbon Elecrtrodes (2002),
reproduced in Pub. App. to Rule 56.2 Mot., ECF No. 28-2 at Tab 2
Ex. 2, at 2 (setting the range, the allowable industry
tolerances, of 16-inch (400 mm) graphite electrodes at 409 to
403 mm – 17 inches (431.8 mm) is not within this range)); Int’l
Electrotechnical Comm’n, International Standard: Graphite
Electrodes for Electric Arc Furnaces – Dimensions and
Designation (2005), reproduced in Pub. App. to Rule 56.2 Mot.,
ECF No. 28-6 at Tab 6 Attachment 1, at 17 (distinguishing the
nominal diameter of 400 mm from the actual diameter
specification range of 409 mm and 403 mm).
Court No. 13-00357 Page 15
investigation, injury determination, and order.21 See AD
Initiation Notice, 73 Fed. Reg. at 8287; AD Final Determination,
74 Fed. Reg. at 2050; AD Order, 74 Fed. Reg. at 8775; ITC Final
Determination, USCIT Pub. 4062 at 6, 9-10.22
Without having given due consideration to relevant
evidence before it, Commerce has not based its decision on a
reasonable reading of the record evidence.23 Thus, Commerce’s
21
Commerce found that “the ITC’s limitation of its injury
analysis to [graphite electrodes] with diameters of 16 inches
and below [did] not preclude [Commerce’s] determination that the
importation of Jilin Carbon’s 17-inch [graphite electrodes] is
circumventing [the order on SDGE from the PRC].” I&D Mem. cmt. 1
at 10. However, Commerce also notes that the question of
whether 17 inch diameter graphite electrodes were injuring the
domestic market was not before the ITC and the ITC had “no known
data concerning domestically produced 17 inch electrodes before
[it] in its injury investigation.” Id. at 9 (quoting an
explanatory memorandum from the ITC). Defendant-Intervenors
claim that the domestic industry did not contemplate including
17-inch graphite electrodes at the time they drafted their
petition “[b]ecause 16 inches was the upper limit of SDGE in the
market.” Def.-Intervenor Resp. Br. at 31. While petitioners and
Commerce need not anticipate every possible modification — after
all, scope and circumvention inquiries are available because
“descriptions of subject merchandise contained in the
Department’s determinations must be written in general terms,”
19 C.F.R. § 351.225(a) — Commerce still cannot interpret an
order contrary to its terms. Wheatland Tube, 161 F. 3d at 1371.
“[T]he minor alterations provision is not a vehicle for
companies to expand an order in a way that petitioners avoided
at the outset.” Deacero S.A.P.I. de C.V. v. United States, Slip
Op. 14-99, 2014 WL 4244349 at *4 (CIT Aug. 28, 2014) (citations
omitted) (“Deacero II”).
22
Cf. Deacero I, __ CIT at __, 942 F. Supp. 2d at 1330-32;
Deacero II, 2014 WL 4244349 at *3-7.
23
The Defendant argues that consideration of additional factors
“would usurp Commerce’s discretion to interpret an ambiguous
(footnote continued)
Court No. 13-00357 Page 16
failure to consider evidence that supports the possibility of an
alternative conclusion has rendered its determination
unsupported by substantial evidence.
CONCLUSION
Accordingly, because Commerce failed to base its
determination on a reasonable reading of the record, its
determination is not supported by substantial evidence. The
court remands for further consideration in accordance with this
opinion. Commerce shall have until November 5, 2014 to complete
and file its remand redetermination. Plaintiff shall have until
November 19, 2014 to file comments. Defendant and Defendant-
Intervenor shall have until December 1, 2014 to file any reply.
IT IS SO ORDERED.
/s/ Donald C. Pogue
Donald C. Pogue, Senior Judge
Dated:
New York, NY
portion of [19 U.S.C. § 1677j(c)].” Def.’s Resp. at 11. But
this is not a question of factors. Rather, it is a question of
facts. The court does not seek to impose its own
“interpretation of how to best effectuate the overall statutory
scheme on the record before it.” Id. at 13. Rather, the court
seeks to ensure that Commerce “examine the record and articulate
a satisfactory explanation for its action.” Yangzhou Bestpak
Gifts, 716 F.3d at 1378 (citation omitted). Commerce may
reasonably interpret an ambiguous statute; it may not fail to
support its determinations with substantial evidence.