Luoyang Bearing Corp. (Grp.) v. United States , 2020 CIT 78 ( 2020 )

Slip Op. 20-
UNITED STATES COURT OF INTERNATIONAL TRADE
LUOYANG BEARING CORPORATION
(GROUP)
Plaintiff,
v.
Before: Gary S. Katzmann, Judge
UNITED STATES, Court No. 19-00026
Defendant,
and
THE TIMKEN COMPANY,
Defendant-Intervenor.
OPINION
[The court denies Plaintiff’s motion and enters judgment for Defendant because Plaintiff failed to
exhaust administrative remedies before Commerce.]
Dated: -XQH
Edmund W. Sim, Appleton Luff Pte Ltd, of Washington, DC, argued for plaintiff. With him on
the briefs were Kelly A. Slater and Jay Y. Nee.
Kelly A. Krystyniak, Trial Counsel, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, of Washington, DC, argued for defendant. With her on the brief were
Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and L. Misha Preheim,
Assistant Director. Of counsel was Nikki Kalbing, Office of the Chief Counsel for Trade
Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC. Of counsel on
the brief was James Henry Ahrens II.
Geert De Prest, Schagrin Associates, of Washington, DC, argued for defendant-intervenor. With
him on the brief was Nicholas J. Birch.
Court No. 19-00026 Page 2
Katzmann, Judge: This case implicates the exhaustion of administrative remedies
requirement of the Customs Courts Act of 1980, 28 U.S.C. § 2637(d) (2018), and provides
occasion to consider the “futility” exception to that statute.
Plaintiff Luoyang Bearing Corporation (Group) (“Luoyang”), a foreign producer and
exporter of tapered roller bearings (“TRBs”) 1 from China, brought an action against the United
States (“the Government”) to challenge a final determination by the United States Department of
Commerce (“Commerce”), Tapered Roller Bearings and Parts Thereof, Finished and Unfinished,
From the People’s Republic of China: Final Results of Antidumping Duty Administrative Review,
2016–2017, 84 Fed. Reg. 6,132–34 (Dep’t Commerce Feb. 26, 2019) (“Final Results”), in which
Commerce denied Luoyang’s separate rate application and applied the country-wide antidumping
(“AD”) rate after finding de facto government control over Luoyang’s board of directors. Mem.
of P. & A. in Supp. of Pl. Luoyang Bearing Corp. (Grp.)’s R. 56.2 Mot. for J. on the Agency R. at
1, Aug. 1, 2019, ECF No. 28 (“Pl.’s Br.”). Luoyang failed to raise any arguments to Commerce
contesting an adverse preliminary determination before bringing a challenge to the court. Luoyang
requests that the court remand Commerce’s decision as “not in accordance with law or unsupported
by substantial evidence.” Compl. at 4, Mar. 4, 2019, ECF No. 4. The Government and Defendant-
Intervenor the Timken Company (“Timken”) respond that the court should deny Luoyang’s motion
for judgment on the agency record for failing to first exhaust administrative remedies. Def.’s
Opp’n to Pl.’s Mot. for J. upon the Admin. R. at 6–9, Oct. 1, 2019, ECF No. 37 (“Def.’s Br.”);
Resp. Br. of Timken at 1, Oct. 1, 2019, ECF No. 36 (“Def.-Inter.’s Br.”). The court denies
1
A “bearing” is “a machine part in which another part (such as a journal or pin) turns or
slides.” Bearing, Merriam Webster, https://www.merriam-webster.com/dictionary/bearing (last
visited May 18, 2020). “TRBs are a type of antifriction bearing made up of an inner ring (cone)
and an outer ring (cup). Cups and cones sell either individually or as a preassembled ‘set.’” NTN
Bearing Corp. of Am. v. United States, 127 F.3d 1061, 1063 (Fed. Cir. 1997).
Court No. 19-00026 Page 3
Luoyang’s motion without reaching the merits of its claims because Luoyang failed to first exhaust
its administrative remedies before Commerce.
BACKGROUND
I. Legal and Regulatory Framework
Congress’s AD statute empowers Commerce to impose remedial duties on imported goods
when those goods are sold in the United States at less-than-fair value and the International Trade
Commission determines that the domestic industry is thereby “materially injured, or is threatened
with material injury.” See 19 U.S.C. § 1673(2)(A)(i)–(ii) (2018); Diamond Sawblades Mfrs. Coal.
v. United States, 866 F.3d 1304, 1306 (Fed. Cir. 2017); Shandong Rongxin Imp. & Exp. Co. v.
United States, 42 CIT __, __, 331 F. Supp. 3d 1390, 1394 (2018), aff’d, 779 F. App’x 744 (Fed.
Cir. 2019) (“Rongxin”). “Sales at less than fair value are those sales for which the ‘normal value’
(the price a producer charges in its home market) exceeds the ‘export price’ (the price of the
product in the United States).” Apex Frozen Foods Private Ltd. v. United States, 862 F.3d 1322,
1326 (Fed. Cir. 2017) (quoting Union Steel v. United States, 713 F.3d 1101, 1103 (Fed. Cir.
2013)). In these instances, “the amount of the [AD duty] is ‘the amount by which the normal value
exceeds the export price (or the constructed export price) for the merchandise.’” Rongxin, 331 F.
Supp. 3d at 1394 (quoting 19 U.S.C. § 1673). Upon request, Commerce may conduct an
administrative review of its AD duty determination and recalculate the applicable rate. 19 U.S.C.
§ 1675(a)(1)–(2); see also Gallant Ocean (Thai.) Co. v. United States, 602 F.3d 1319, 1321 (Fed.
Cir. 2010); Rongxin, 331 F. Supp. 3d at 1394.
Court No. 19-00026 Page 4
When a proceeding concerns a non-market economy (“NME”) country, 2 such as China,
“Commerce presumes that all respondents to the proceeding are government-controlled and
therefore subject to a single country-wide [AD] duty rate.” Rongxin, 331 F. Supp. 3d at 1394
(citing Dongtai Peak Honey Indus. v. United States, 777 F.3d 1343, 1349–50 (Fed. Cir. 2015)).
See also Sigma Corp. v. United States, 117 F.3d 1401, 1405 (Fed. Cir. 1997). However,
respondents may rebut this presumption of government control and establish eligibility for a rate
separate from the country-wide rate by demonstrating freedom from both de jure (legal) and de
facto (factual) government control. Dongtai Peak Honey, 777 F.3d at 1350; Rongxin, 331 F. Supp.
3d at 1394.
Prior to challenging a determination by Commerce before the court, both statute, 28 U.S.C.
§ 2637(d), and Commerce’s own regulation, 19 C.F.R. § 351.309(c)(2), require respondents to
exhaust all administrative remedies available at the agency level. The statute, in relevant part,
states that “the Court of International Trade shall, where appropriate, require the exhaustion of
administrative remedies.” 28 U.S.C. § 2637(d). The court may exercise its discretion to excuse a
respondent from this procedural administrative exhaustion requirement in specific narrow
circumstances. See id. (requiring exhaustion “where appropriate”). One such narrow
circumstance is when the respondent can demonstrate that raising the issue would have been futile.
Corus Staal BV v. United States, 502 F.3d 1370, 1379 (Fed. Cir. 2007); Itochu Bldg. Prods. v.
United States, 733 F.3d 1140, 1146 (Fed. Cir. 2013).
2
A non-market economy country is “any foreign country that [Commerce] determines does not
operate on market principles of cost or pricing structures, so that sales of merchandise in such
country do not reflect the fair value of the merchandise.” 19 U.S.C. § 1677(18)(A).
Court No. 19-00026 Page 5
II. Factual and Procedural History
On June 7, 2017, Commerce published a notice of opportunity to request an administrative
review of its AD order on TRBs from China for the period of June 1, 2016 through May 31, 2017.
Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation: Opportunity to
Request Administrative Review, 82 Fed. Reg. 26,441, 26,441 (Dep’t Commerce June 7, 2017).
Luoyang, among the two largest Chinese TRB exporters during the period of review (“POR”),
timely requested an administrative review, and Commerce selected Luoyang for individual
examination. See 19 U.S.C. § 1677f-1 (2012); Mem. from I. Baig (AD/CVD Operations) to M.
Skinner (AD/CVD Operations), re: Selection of Respondents for Individual Review at 5 (Dep’t
Commerce Aug. 24, 2017), P.R. 41. In response, Commerce issued an initial questionnaire to
Luoyang. See Letter from Luoyang to Sec’y of Commerce, re: Sec. A Resp. (Sept. 29, 2017), P.R.
100. Commerce later requested supplemental questionnaire responses on November 9, 2017, to
which Luoyang responded on November 27, 2017. Letter from S. Thompson (AD/CVD
Operations) to Luoyang, re: Suppl. Sec. A Questionnaire (Dep’t Commerce Nov. 9, 2017), P.R.
127; Letter from Luoyang to Sec’y of Commerce, re: Suppl. Sec. A Resp. (Nov. 27, 2017), P.R.
133 (“Luoyang’s Suppl. Sec. A Resp.”). That response constitutes the final communication
between Luoyang and Commerce regarding this review prior to the initiation of the instant case.
Commerce published preliminary results on July 12, 2018, denying Luoyang separate rate
status because it failed to rebut the presumption of governmental control over its export activities.
Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, from the People’s Republic
of China: Preliminary Results and Intent to Rescind the Review in Party; 2016–2017, 83 Fed. Reg.
32,263 (Dep’t Commerce July 12, 2018) (“Preliminary Results”). Consequently, Luoyang was
subject to the 92.84 percent China-wide AD rate. Id. Commerce based its decision on Luoyang’s
Court No. 19-00026 Page 6
corporate ownership structure and associated shareholder control. Mem. from G. Taverman
(AD/CVD Operations) to W. Frankel (AD/CVD Operations), re: Decision Mem. for the Prelim.
Results of the 2016–17 AD Duty and Admin. Review of TRBs and Parts Thereof, Finished and
Unfinished, from the People’s Republic of China at 10 (July 3, 2018), P.R. 223 (“PDM”). Luoyang
is majority owned by Henan Machinery, which is wholly owned by Henan SASAC, a government-
owned entity that oversees China’s assets in Henan Province. Id. Commerce found government
control because the Chinese government, as majority shareholder, “exercises its rights inherent in
majority ownership as would be expected.” Id. “Because of . . . the control that [government]
ownership on its own establishes, we preliminarily conclude that Luoyang does not satisfy the
criteria demonstrating an absence of de facto government control over export activities, consistent
with our determination in the [Final Results of Redetermination Pursuant to Diamond Sawblades
Manufacturers’ Coalition v. United States, (Dep’t Commerce Dec. 1, 2015), available at
http://enforcement.trade.gov/remands/15-92.pdf.]” Id. Luoyang did not submit an administrative
case brief between the publication of the Preliminary Results and the Final Results. See Pl.’s
Reply Br. in Supp. of Pl. Luoyang’s R. 56.2 Mot. for J. on Agency R. at 2, Oct. 21, 2019, ECF No.
39 (“Pl.’s Reply”); Def.’s Br. at 6; Def.-Inter.’s Br. at 7. Thus, Commerce continued to apply the
countrywide rate to Luoyang in the Final Results. Final Results at 6,133.
Luoyang commenced this action on March 4, 2019. Summons, ECF No. 1; Compl. On
August 1, 2019, Luoyang moved for judgment on the agency record, challenging Commerce’s
Final Results as neither supported by substantial evidence or otherwise in accordance with law.
Pl.’s Br. at 1. The Government and Timken responded on October 1, 2019. See Def.’s Br.; Def.-
Inter.’s Br. Luoyang replied on October 21, 2019. Pl.’s Reply. The court held oral argument via
teleconference on April 8, 2020. ECF No. 49.
Court No. 19-00026 Page 7
JURISDICTION AND STANDARD OF REVIEW
The court has jurisdiction over this action pursuant to 28 U.S.C. § 1581(c) and 19 U.S.C.
§ 1516a(b)(1)(B)(i). The standard of review in this action is set forth in 19 U.S.C. §
1516a(b)(1)(B)(i): “[t]he court shall hold unlawful any determination, finding or conclusion found
. . . to be unsupported by substantial evidence on the record, or otherwise not in accordance with
law.” As noted, however, preceding a review by the court of the merits of a given claim, a party
challenging agency action must have first exhausted its administrative remedies or demonstrated
to the court that it should be exempted from that requirement. See Boomerang Tube LLC v. United
States, 856 F.3d 908, 912 (Fed. Cir. 2017).
DISCUSSION
For the reasons stated below, the court denies Luoyang’s motion for judgment on the
agency record, without reaching the merits of its claims, because Luoyang failed either to exhaust
its administrative remedies before Commerce or to articulate a persuasive ground for the court to
exercise its discretion to exempt Luoyang from so doing.
I. Luoyang Did Not Exhaust its Administrative Remedies, and Exhaustion Would
Not Have Been Futile.
A. Parties’ Contentions in Context
As has been recited, the burden is on the separate rate applicant to overcome the
presumption of government control in an NME. Preliminarily, Commerce found that Luoyang
was ineligible for a separate rate because the Chinese government indirectly owns a majority of its
shares. PDM at 10. The record demonstrates, and Luoyang does not contest, that Luoyang’s last
communication to Commerce occurred on November 27, 2017, in which it provided answers to
Commerce’s supplemental questionnaire responses -- answers that resulted in a preliminary denial
Court No. 19-00026 Page 8
of its separate rate application. See Luoyang’s Suppl. Sec. A Resp..; Pl.’s Reply at 2. In other
words, it is undisputed that Luoyang failed to exhaust its administrative remedies.
The Government and Timken argue that Luoyang’s claims should be dismissed because
Luoyang did not exhaust its administrative remedies before Commerce as required by statute and
Commerce’s regulations. See Def.’s Br. at 6–9; Def.-Inter.’s Br. at 6–9. Luoyang contends that,
because evidence of its ownership and shareholder structure did not change between the
publication of the Preliminary Results and the Final Results and Commerce used this evidence to
deny Luoyang a separate rate, it would have been futile for Luoyang to submit a case brief to
Commerce raising arguments to challenge the preliminary denial of a separate rate. Pl.’s Reply at
2; see PDM at 10. Luoyang acknowledges the narrowness of the futility exception but argues that
“an adverse separate rates decision before Commerce was more than just ‘likely:’ it was virtually
guaranteed.” Pl.’s Reply at 4 (quoting Corus Staal, 502 F.3d at 1379). To support this contention,
Luoyang highlights Commerce’s practice of reviewing similarly situated entities that, in
Luoyang’s view, is “focused almost exclusively around any degree of government ownership in
the respondent, however attenuated.” Pl.’s Reply at 5. As a result, Luoyang argues, “it would
appear that any degree of government ownership in a respondent renders futile any efforts for a
respondent to demonstrate otherwise a lack of government control over its export operations,
whether substantial evidence bears this out or not.” Id. Accordingly, Luoyang argues that the
court should employ the discretion that 28 U.S.C. § 2637(d) provides to waive the otherwise strict
requirement of administrative exhaustion by a respondent in an investigation by Commerce and
thus hear its claim. Id. at 6. To address this question, the court first examines the law of
administrative exhaustion, and then the futility exception.
Court No. 19-00026 Page 9
B. Basic Principles
The Federal Circuit has made clear that 28 U.S.C. § 2637(d), the exhaustion statute,
“indicates a congressional intent that, absent a strong contrary reason, the court should insist that
parties exhaust their remedies before the pertinent administrative agencies.” Corus Staal, 502 F.3d
at 1379. Under this framework, the Federal Circuit explained that respondents in Commerce
investigations are “procedurally required to raise” all issues and arguments in case briefs to
Commerce “at the time Commerce [is] addressing the issue.” Dorbest Ltd. v. United States, 604
F.3d 1363, 1375 (Fed. Cir. 2010) (citing Mittal Steel Point Lisas Ltd. v. United States, 548 F.3d
1375, 1383 (Fed. Cir. 2008)). The requirement derives from concerns regarding “[s]imple fairness
to those who are engaged in the tasks of administration, and to litigants, [requiring] as a general
rule that courts should not topple over administrative decisions unless the administrative body not
only has erred but has erred against objection made at the time appropriate under its practice.” Id.
(quoting United States v. L.A. Tucker Truck Lines, 344 U.S. 33, 37 (1952)). “[A] failure to
enforce the exhaustion of administrative remedies principle could lead to ‘frequent and deliberate
flouting of the administrative processes [that] could weaken the effectiveness of an agency by
encouraging people to ignore [administrative] procedures.’” Budd Co., Wheel & Brake Div. v.
United States, 15 CIT 446, 453, 773 F. Supp. 1549, 1555 (1991) (quoting McKart v. United States,
395 U.S. 185, 195 (1969)). Further, the Federal Circuit has explained that the exhaustion
requirement protects “an agency’s interest in being the initial decisionmaker . . . [and] serve[s]
judicial efficiency by promoting development of an agency record that is adequate for later court
review and by giving an agency a full opportunity to correct errors and thereby narrow or even
eliminate disputes.” Itochu Bldg. Prods., 733 F.3d at 1145. See also McCarthy v. Madigan, 503
U.S. 140, 145 (1992). Respondents can meet the exhaustion requirement by submitting a case
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brief to Commerce after the publication of preliminary results that includes “all arguments that
continue in the submitter’s view to be relevant” to the final results, “including any arguments
presented before the date of publication of the preliminary determination or preliminary results.”
19 C.F.R. § 351.309(c)(2). See Corus Staal, 502 F.3d at 1378. “The exhaustion requirement in
this context is therefore not simply a creature of court decision, as is sometimes the case, but is a
requirement explicitly imposed by the agency as a prerequisite to judicial review.” Corus Staal,
502 F.3d at 1379. 3
Exceptions to the exhaustion requirement are limited, including where raising the claim is
futile or where the question is one of pure law and does not require further factual development.
Itochu Bldg. Prods., 733 F. Supp. 3d at 1146; Zhongce Rubber Grp. Co. v. United States, 42 CIT
__, __, 352 F.3d 1276, 1279–80 (2018), aff’d, 787 F. App’x 756 (Fed. Cir. 2019). See also
Luoyang Bearing Factory v. United States, 26 CIT 1156, 1186 n.26, 240 F. Supp. 2d 1268, 1297
n.26 (2002) (listing exceptions as (1) futility; (2) a subsequent court decision that may impact the
agency’s decision; (3) a pure question of law; or (4) when plaintiff had reason to believe the agency
would not follow established precedent). Relevant here, the court may excuse the exhaustion of
administrative remedies requirement in situations where plaintiffs prove futility by showing that
3
The Government notes that “Commerce considers arguments raised in case and rebuttal case
briefs, and can -- indeed, often does -- alter the methodology applied, or correct mistakes, in its
final determination.” Def.’s Resps. to Ct.’s Questions for Oral Arg. at 6, Apr. 6, 2020, ECF No.
47 (“Def.’s Suppl. Br.”). The Government observes that “[c]ase briefs and rebuttal case briefs
offer a mechanism through which interested parties can raise and debate points of law or fact
arising during the proceedings, and before Commerce makes a final determination.” Id. at 6.
Respondents can use this opportunity to “flag any errors that Commerce may have made in its
preliminary determinations, or point to evidence on which it believes Commerce should rely.” Id.
“[T]he case brief process almost certainly reduces the volume of litigation arising from
Commerce’s determinations” and elsewhere “permits Commerce to develop the administrative
record and address arguments that are raised, facilitating judicial review of Commerce’s
decisions.” Id.
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exhaustion would “require[] [them] to go through obviously useless motions in order to preserve
their rights.” Corus Staal, 502 F.3d at 1379 (citations omitted); Itochu Bldg. Prods., 733 F.3d at
1146 (explaining that the futility exception may apply “where it is clear that additional filings with
the agency would be ineffectual”). However, the futility exception to the administrative
exhaustion requirement “is a narrow one.” Corus Staal, 502 F.3d at 1379. “The mere fact that an
adverse decision may have been likely does not excuse a party from a statutory or regulatory
requirement that it exhaust administrative remedies.” Id. (citation omitted).
C. Analysis
Federal Circuit precedent, analyzing and rejecting claims of futility very similar to that
posed by Luoyang, informs the court’s disposition of the instant litigation. In Corus Staal, a
seminal case addressing the futility exception to administrative exhaustion, the Federal Circuit
reviewed a respondent’s argument that addressing an issue in a case brief to Commerce would
have been futile because it had already presented those arguments to Commerce in its questionnaire
response and received an adverse preliminary determination. 502 F.3d at 1378–81. There, Corus
“claim[ed] that it put Commerce on notice as to its position with regard to the [] issue in its . . .
submission in response to Commerce’s request for information, and Commerce responded by
rejecting those arguments in the preliminary results.” Id. at 1378. Corus maintained that “in the
past Commerce had consistently taken a position contrary to Corus’s legal arguments regarding
[the issue] and was therefore unlikely to accept those arguments if Corus pressed them in its case
brief.” Id. Luoyang’s argument is nearly identical to the one Corus presented to the Federal
Circuit. See Pl.’s Reply at 5 (“[B]ecause Luoyang effectively has no chance of success to be
gained by raising its de facto separate rates arguments before Commerce based on additional and
Court No. 19-00026 Page 12
arguably substantial evidence of non-governmental control over its export operations, it is in effect
pointless for Luoyang to raise those arguments in the first place.”).
The Federal Circuit in Corus Staal rejected the plaintiff’s argument: “it is not obvious that
the presentation of [Corus’s] arguments to the agency would have been pointless[,]” and “Corus
has provided nothing by way of affirmative justification for its failure to raise the . . . issue in its
case brief.” 502 F.3d at 1380–81. The Federal Circuit explained that “[t]he response that
Commerce gave in the preliminary results . . . was brief and was expressly designated as
preliminary; it was not designed to be Commerce’s last word on the matter.” Id. at 1380. Indeed,
requiring respondents to set forth their arguments in a case brief before the final determination has
“potential value either by resulting in possible relief for [respondents] or at least providing the
agency an opportunity to set forth its position in a manner that would facilitate judicial review.”
Id. This requirement is particularly important where the issue involves the exercise of Commerce’s
discretion, such as in policy or fact-based methodology questions where Commerce could change
its determination based on interested party arguments. See id. (“Even if it is unlikely that
Commerce would adopt Corus’s legal arguments . . . , it was still possible that upon full airing,
Commerce might have accepted Corus’s factual showing that it had not absorbed antidumping
duties, thereby obviating the need for judicial review.”). Id. Crucially, the court noted that a likely
adverse decision without more “does not excuse a party from a statutory or regulatory requirement
that it exhaust administrative remedies.” Id. at 1379. In other words, Corus failed to exhaust its
administrative remedies with the agency and did not present facts indicating that further
argumentation before Commerce would have been futile. Id. at 1381. Accordingly, the Federal
Circuit ruled that this court did not abuse its discretion by refusing to hear the merits of the claim.
Id.
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Luoyang’s argument cannot prevail for the reasons the Federal Circuit relied on in Corus
Staal. See id. at 1380. Luoyang had the same opportunity that the respondent in Corus Staal had:
to present legal arguments concerning Commerce’s practice and its application in this instance and
to present factual issues that Luoyang asserts support its claims. Luoyang chose to do neither.
Commerce’s initial separate rate denial was preliminary, and Luoyang was required to give
Commerce a full opportunity to address Luoyang’s arguments before bringing a challenge to the
court. See id. Despite Commerce’s consistent position regarding indirect ownership and de facto
independence from government control, indicating that an adverse final decision may have been
likely, Luoyang was still required to present a case brief. See id. at 1379–80. The agency decision
at issue was whether the respondent, based on the agency’s criteria, had overcome the presumption
of government control so as to be eligible for separate rate status. That decision involves the
evaluation of facts that vary substantially from case to case and criteria that have frequently been
the subject of litigation. See, e.g., Shandong Rongxin Import & Export Co. v. United States, 43
CIT __, 355 F. Supp. 3d 1365 (2019); Zhejiang Quzhou Lianzhou Refrigerants Co. v. United
States, 42 CIT __, 350 F. Supp. 3d 1308 (2018); Advanced Tech. & Materials Co. v. United States,
37 CIT __, 938 F. Supp. 2d 1342 (2013), aff’d, 581 F. App’x. 900, 901 (Fed. Cir. 2014). Indeed,
in its Separate Rate Certification filed at the outset of this annual review, Luoyang certified that
it had in fact received separate rate status in several prior reviews of the AD order on TRBs from
China. Letter from Luoyang to Sec’y of Commerce, re: Luoyang’s Separate Rate Certification at
3 (Aug. 31, 2017), P.R. 66. See also Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, from the People’s Republic of China: Final Results of 2003–2004 Administrative
Review, 71 Fed. Reg. 2,517 (Dep’t Commerce Jan. 17, 2006); Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, from the People’s Republic of China: Final Results of 2000–
Court No. 19-00026 Page 14
2001 Administrative Review, 67 Fed. Reg. 68,991 (Dep’t Commerce Nov. 14, 2002); Tapered
Roller Bearings and Parts Thereof, Finished and Unfinished, From the People’s Republic of China;
Final Results of 1999–2000 Administrative Review, 66 Fed. Reg. 57,421 (Dep’t Commerce Nov.
15, 2001). Luoyang’s premise -- that an adverse decision in the 2016–2017 review was “virtually
guaranteed” -- is hardly self-evident. See Pl.’s Reply at 4. Luoyang’s assertions, without more,
fail to justify an exercise of the court’s discretion to exempt it from the exhaustion requirement of
28 U.S.C. § 2637(d). 4
CONCLUSION
Considering all the relevant circumstances, the court determines that Luoyang has failed to
demonstrate futility and concludes that no justification has been shown for making an exception
4
The Government argues, Def.’s Suppl. Br. at 3–4, and the court agrees, that the present case is
distinct from Itochu Building Products. See 733 F.3d 1140. That case presented rare
circumstances not applicable here. There, in a changed circumstances review involving a statute
governing administrative reviews, the plaintiff had “submitted comments, met with Commerce
officials, and provided legal authority” before Commerce issued its preliminary results, but failed
to later submit a case brief. Id. at 1142. The Federal Circuit ruled that exhaustion need not apply
to arguments regarding the effective date of the revocation when there was “no reasonable
prospect” that Commerce, based on its interpretation of the statute, would have modified the
effective date. Id. at 1146–48. The Federal Circuit determined that the futility exception should
apply where “Commerce had heard everything on the issue that [the plaintiff] had to say” prior to
the publication of the preliminary results. Id. at 1147. The Itochu Building Products court also
distinguished the result required by Commerce’s interpretation of a statute in that case from the
fact dependent determination in Corus Staal, 502 F.3d 1370, in which Commerce may have
changed its position based on additional factual and legal arguments. Itochu Bldg. Prods., 733
F.3d at 1147–48. Like the plaintiff in Corus Staal, Luoyang could have made additional arguments
or highlighted record evidence that Commerce could then adopt or address on the administrative
record. Second, as the Government and Timken note, the determination at issue here was a fact-
based methodological one. Def.’s Suppl. Br. at 2; Resp. of Timken to Questions for Oral Arg. at
2, Apr. 6, 2020, ECF No. 48. That is, Commerce’s separate rate determination was fact specific,
unlike the determination at issue in Itochu Building. Products. See 733 F.3d at 1148; PDM at 6–
8. In short, the court finds that this case is similar to Corus Staal, 502 F.3d at 1379, in which the
Federal Circuit required exhaustion, and unlike Itochu Building Products, in which it applied the
futility exception. See 733 F.3d at 1147–48.
Court No. 19-00026 Page 15
to the exhaustion requirement set forth in 28 U.S.C. § 2637(d). Pursuant to USCIT Rule 56, the
court will enter judgment in favor of Defendant.
SO ORDERED.
/s/ Gary S. Katzmann
Judge
Dated:-XQH
New York, New York