Jbf Rak LLC v. United States ( 2015 )

United States Court of Appeals
for the Federal Circuit
______________________
JBF RAK LLC,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
MITSUBISHI POLYESTER FILM, INC., DUPONT
TEIJIN FILMS, SKC, INC.,
Defendants
______________________
2014-1774
______________________
Appeal from the United States Court of International
Trade in No. 13-cv-00211, Senior Judge Judith M. Barzi-
lay.
______________________
Decided: June 24, 2015
______________________
JACK MLAWSKI, Galvin & Mlawski, New York, NY,
argued for plaintiff-appellant.
MELISSA M. DEVINE, Commercial Litigation Branch,
Civil Division, United States Department of Justice,
Washington, DC, argued for defendant-appellee. Also
represented by JOYCE R. BRANDA, JEANNE E. DAVIDSON,
PATRICIA M. MCCARTHY; DEVIN S. SIKES, Office of the
2 JBF RAK LLC V. UNITED STATES
Chief Counsel for Import Administration, United States
Department of Commerce, Washington, DC.
______________________
Before DYK, WALLACH, and HUGHES, Circuit Judges.
WALLACH, Circuit Judge.
Appellant JBF RAK, LLC (“JBF RAK”) appeals the
United States Court of International Trade’s (“CIT”)
decision sustaining the U.S. Department of Commerce’s
(“Commerce”) final results of the administrative review
covering polyethylene terephthalate film (“PET Film”)
from the United Arab Emirates (“UAE”) for the period of
review from November 1, 2010 through October 31, 2011.
See Polyethylene Terephthalate Film, Sheet, and Strip
from the United Arab Emirates, 78 Fed. Reg. 29,700
(Dep’t of Commerce May 21, 2013) (final results of anti-
dumping duty administrative review; 2010–2011) (“Final
Results”). For the reasons set forth below, we affirm.
BACKGROUND
Commerce issued an antidumping duty order covering
PET Film from UAE in November 2008. See Polyethylene
Terephthalate Film, Sheet, and Strip from Brazil, the
People’s Republic of China, and the United Arab Emirates,
73 Fed. Reg. 66,595 (Dep’t of Commerce Nov. 10, 2008)
(antidumping duty orders and amended final determina-
tion of sales at less than fair value for the United Arab
Emirates). JBF RAK is a manufacturer and exporter of
PET Film from UAE, and pursuant to 19 U.S.C.
§ 1675(a)(1) (2006), on November 30, 2011, it requested
that Commerce conduct an administrative review of the
antidumping duty order for this period of review. Com-
merce initiated its review in December 2011. See Initia-
tion of Antidumping and Countervailing Duty
Administrative Reviews and Request for Revocation in
Part, 76 Fed. Reg. 82,268 (Dep’t of Commerce Dec. 30,
2011) (initiation). However, before Commerce published
JBF RAK LLC V. UNITED STATES 3
its preliminary results, Mitsubishi Polyester Film, Inc.,
SKC, Inc., and Toray Plastics America, Inc. (collectively
“domestic producers”) filed an allegation of targeted
dumping 1 against JBF RAK on November 16, 2012. In
that petition, the domestic producers argued Commerce
should not use the average-to-average comparison method
typically used in administrative reviews 2 because that
method would not account for the price differences of JBF
RAK’s merchandise, and should instead use an average-
to-transaction method of comparison.
On December 7, 2012, Commerce published its pre-
liminary results and assigned JBF RAK a dumping mar-
gin of 5.31% using its average-to-average comparison
methodology. See Polyethylene Terephthalate Film, Sheet,
and Strip from the United Arab Emirates, 77 Fed. Reg.
1 Targeted dumping occurs in “situations where
comparable merchandise ‘differ[s] significantly among
purchasers, regions, or periods of time.’” U.S. Steel Corp.
v. United States, 621 F.3d 1351, 1359 (Fed. Cir. 2010)
(quoting 19 U.S.C. § 1677f-1(d)(1)(B)).
2 In 2012, Commerce revised its methodology in
administrative reviews from using average-to-transaction
comparisons as its general practice in administrative
reviews to average-to-average comparisons as the default
method for calculating weighted average dumping mar-
gins. Union Steel v. United States, 713 F.3d 1101, 1106
n.5 (Fed. Circ. 2013) (citing Antidumping Proceedings:
Calculation of the Weighted-Average Dumping Margin
and Assessment Rate in Certain Antidumping Duty Pro-
ceedings; Final Modification, 77 Fed. Reg. 8,101, 8,101
(Feb. 14, 2012) (codified at 19 C.F.R. pt. 351) (Commerce
“will calculate weighted-average margins of dumping and
antidumping duty assessment rates in a manner which
provides offsets for non-dumped comparisons while using
monthly average-to-average . . . comparisons in reviews.”).
4 JBF RAK LLC V. UNITED STATES
73,010, 73,010–11 & n.5 (Dep’t of Commerce Dec. 7, 2012)
(preliminary results of antidumping duty administrative
review; 2010–2011) (“Preliminary Results”). In its ac-
companying Preliminary Decision Memorandum, Com-
merce indicated it “did not have sufficient time to fully
analyze [the targeted dumping issue] for purposes of these
preliminary results” and that it would “address [the
domestic producers’] targeted dumping allegation at a
later date.” Polyethylene Terephthalate Film, Sheet, and
Strip from the United Arab Emirates A-520-803 (Decision
Memorandum for the Preliminary Results of Antidumping
Duty Administrative Review) (Dep’t of Commerce Nov. 30,
2012) (J.A. 123–31).
On March 8, 2013, Commerce published a post-
preliminary determination addressing the domestic
producers’ allegation of targeted dumping. See Polyeth-
ylene Terephthalate Film, Sheet, and Strip from the
United Arab Emirates, A-520-803 (Post-Preliminary
Results Analysis Memo for JBF RAK LLC) (Dep’t of
Commerce Mar. 8, 2013) (J.A. 164–65) (“Post-Preliminary
Determination”). Using an average-to-transaction com-
parison methodology, Commerce determined JBF RAK
had engaged in targeted dumping and assigned it a
revised dumping margin of 9.80%. After interested par-
ties were invited to comment on Commerce’s targeted
dumping analysis, Commerce continued to apply the
average-to-transaction comparison methodology and
carried on the dumping margin of 9.80%. See Final
Results, 78 Fed. Reg. at 29,700–01.
JBF RAK appealed to the CIT, and in July 2014, that
court denied JBF RAK’s motion for judgment on the
agency record. JBF RAK LLC v. United States, 991 F.
Supp. 2d 1343 (Ct. Int’l Trade 2014). Before the CIT, JBF
RAK challenged, inter alia, Commerce’s targeted dumping
analysis, and disputed Commerce’s authority to apply the
average-to-transaction comparison method in administra-
tive reviews. The CIT held that Commerce provided a
JBF RAK LLC V. UNITED STATES 5
legitimate explanation for applying the average-to-
transaction method in the review, and sustained the Final
Results.
JBF RAK appeals and this court has jurisdiction
pursuant to 28 U.S.C. § 1295(a)(5) (2012).
DISCUSSION
I. Standard of Review and Legal Framework
The court “review[s] a decision of the [CIT] evaluating
an antidumping determination by Commerce by reapply-
ing the statutory standard of review that the [CIT] ap-
plied in reviewing the administrative record.” Ta Chen
Stainless Steel Pipe, Inc. v. United States, 298 F.3d 1330,
1335 (Fed. Cir. 2002). Thus, this court sustains “any
determination, finding, or conclusion” made by Commerce
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) (2012).
The antidumping duty statute provides for the appli-
cation of remedial duties to foreign goods sold, or likely to
be sold, in the United States at less than fair value. Id.
§ 1673(1). A dumping margin is the amount by which
“‘normal value’ (the price a producer charges in its home
market) exceeds the ‘export price’ (the price of the product
in the United States) or ‘constructed export price.’” U.S.
Steel Corp. v. United States, 621 F.3d 1351, 1353 (Fed.
Cir. 2010) (quoting 19 U.S.C. § 1677(35)(A)). Commerce
calculates a “dumping margin” for each entry of subject
merchandise that is under review. See 19 U.S.C.
§ 1675(a)(2)(A)(ii) (2006).
This court employs the two-part test articulated in
Chevron, U.S.A., Inc. v. Natural Resources Defense Coun-
cil, Inc., 467 U.S. 837 (1984) in reviewing Commerce’s
interpretation of the statute. We first look to “whether
Congress has directly spoken to the precise question at
issue.” Id. at 842. “[I]f the statute is silent or ambiguous
6 JBF RAK LLC V. UNITED STATES
with respect to the specific issue,” we assess whether
Commerce’s “answer is based on a permissible construc-
tion of the statute.” Id. at 843.
II. Analysis
On appeal, JBF RAK claims Commerce: (1) unlawful-
ly applied its targeted dumping methodology in the con-
text of an administrative review; (2) improperly
considered petitioners’ allegation of targeted dumping; (3)
unlawfully issued the Post-Preliminary Determination;
and (4) failed to consider certain facts about JBF RAK’s
pricing practices in its targeted dumping determination.
We address these arguments seriatim.
A. Commerce’s Targeted Dumping Analysis Is Not Con-
trary to Law
JBF RAK’s primary argument on appeal is that
“Commerce improperly considered the targeting allega-
tion by relying on the statutory provision for investiga-
tions.” Appellant’s Br. 7. Specifically, JBF RAK asserts
that 19 U.S.C. § 1677f-1(d)(1)(B) 3 provides an “exception”
3 In relevant part, 19 U.S.C. § 1677f-1(d)(1) and (2)
state:
(d) Determination of less than fair value
(1) Investigations
(A) In general
In an investigation under part II of this
subtitle, [Commerce] shall determine wheth-
er the subject merchandise is being sold in
the United States at less than fair value—(i)
by comparing the weighted average of the
normal values to the weighted average of the
export prices (and constructed export prices)
for comparable merchandise, or (ii) by com-
paring the normal values of individual
transactions to the export prices (or con-
JBF RAK LLC V. UNITED STATES 7
to use an average-to-transaction comparison only in
investigations, and it cannot be applied in administrative
reviews. Id. at 6. That is, to JBF RAK, because Congress
created an explicit exception in the statute for investiga-
tions but did not include one in the section relating to
administrative reviews, Commerce is not able to use an
“average-to-transaction” comparison in administrative
reviews. The government counters that the CIT correctly
structed export prices) of individual transac-
tions for comparable merchandise.
(B) Exception
[Commerce] may determine whether the
subject merchandise is being sold in the
United States at less than fair value by com-
paring the weighted average of the normal
values to the export prices (or constructed
export prices) of individual transactions for
comparable merchandise, if—(i) there is a
pattern of export prices (or constructed ex-
port prices) for comparable merchandise that
differ significantly among purchasers, re-
gions, or periods of time, and (ii) [Commerce]
authority explains why such differences can-
not be taken into account using a method de-
scribed in paragraph (1)(A)(i) or (ii).
(2) Reviews
In a review under section 1675 of this ti-
tle, when comparing export prices (or con-
structed export prices) of individual
transactions to the weighted average price of
sales of the foreign like product, [Commerce]
shall limit its averaging of prices to a period
not exceeding the calendar month that corre-
sponds most closely to the calendar month of
the individual export sale.
19 U.S.C. § 1677f-1(d).
8 JBF RAK LLC V. UNITED STATES
held that Commerce’s interpretation was reasonable and
entitled to Chevron deference.
Under Chevron step one, this court first looks to
“whether Congress has directly spoken to the precise
question at issue.” Chevron, 467 U.S. at 842. JBF RAK
contends “the statute is not silent. The provision with
respect to investigations creates an ‘exception’ and the
provisions immediately after applicable to reviews, do not,
and, thus, refute any asserted ambiguity or silence.”
Appellant’s Br. 8. Appellant’s expressio unius est exclusio
alterius line of reasoning fails. Section 1677f-1(d)(2) of
Title 19 provides for calculating the dumping margin in
administrative reviews; it does not, however, provide the
specific methodology to make the comparison between
normal value and the actual or constructed export price.
See 19 U.S.C. § 1677f-1(d)(2). Thus, because Congress did
not speak to the precise question at issue, we turn to
Chevron step two: whether Commerce’s interpretation “is
based on a permissible construction of the statute.”
Chevron, 467 U.S. at 843.
When a statute fails to make clear “any Congression-
ally mandated procedure or methodology for assessment
of the statutory tests,” Commerce “may perform its duties
in the way it believes most suitable.” U.S. Steel Grp. v.
United States, 96 F.3d 1352, 1362 (Fed. Cir. 1996). Under
Chevron, “[i]f Congress has explicitly left a gap for the
agency to fill, there is an express delegation of authority
to the agency to elucidate a specific provision of the stat-
ute by regulation. Such legislative regulations are given
controlling weight unless they are arbitrary, capricious, or
manifestly contrary to the statute.” Chevron, 467 U.S. at
843–44.
Pursuant to 19 C.F.R. § 351.414(b) (2012),
“[c]omparison of normal value with export price (con-
structed export price),” there are three methods by which
value may be compared to export price or constructed
JBF RAK LLC V. UNITED STATES 9
export price: (1) average-to-average: “a comparison of the
weighted average of the normal values with the weighted
average of the export prices (and constructed export
prices) for comparable merchandise;” (2) transaction-to-
transaction: “a comparison of the normal values of indi-
vidual transactions with the export prices (or constructed
export prices) of individual transactions for comparable
merchandise;” and (3) average-to-transaction: “a compari-
son of the weighted average of the normal values to the
export prices (or constructed export prices) of individual
transactions for comparable merchandise.” 19 C.F.R.
§ 351.414(b)(1)–(3). The regulation also states that in
choosing the method of review “in an investigation or
review, [Commerce] will use the average-to-average
method unless [it] determines another method is appro-
priate in a particular case.” Id. at § 351.414(c)(1) (empha-
sis added).
Here, Commerce “exercised its gap-filling discretion
by applying a comparison methodology[, i.e. the average-
to-transaction comparison method,] in reviews that paral-
lels the methodology used in investigations.” JBF RAK,
991 F. Supp. 2d at 1347. JBF RAK points to no authority
that contradicts this practice. Thus, contrary to JBF
RAK’s claims, Commerce’s decision to apply its average-
to-transaction comparison methodology in the context of
an administrative review is reasonable. Because Con-
gress did not provide for a direct methodology, Commerce
properly “fill[ed] th[at] gap.” Chevron, 467 U.S. at 843.
JBF RAK also contends the Statement of Administra-
tive Action (“SAA”) accompanying the Uruguay Round
Agreements Act “do[es] not provide the authority to apply
the explicit exception for investigations in Section 1677f-
1(d)(1)(B) to administrative reviews.” Appellant’s Br. 4.
JBF RAK relies on Article 2.4.2 of the SAA, which states,
“[i]n a departure from current U.S. law, Article 2.4.2
provides that in investigations (not reviews), national
authorities normally will establish dumping margins by
10 JBF RAK LLC V. UNITED STATES
comparing either: a weighted-average of normal values to
a weighted-average of export prices of comparable mer-
chandise; or normal value and export price on a transac-
tion-to-transaction basis.” Appellant’s Br. 12 (quoting
SAA, H.R. No. 103-316, vol. 1, at 810 (1994), reprinted in
1994 U.S.C.C.A.N 4040, 4153 (emphasis added). Accord-
ing to JBF RAK, “[t]he parenthetical language in the SAA
‘(not reviews)’ clearly and unambiguously establishes
Congress’ understanding of the obligation under the
agreement that the targeting allegation is to be consid-
ered and, if it exists, an alternative comparison method is
applied in investigations and ‘not reviews.’” Id. However,
this passage fails to address what methods Commerce
may use to make comparisons between normal value and
export price or constructed export price in administrative
reviews; it addresses investigations only. Moreover, as
the government notes, “the SAA does not limit the pro-
ceedings in which Commerce may consider an alternate
comparison method when an average-to-average or trans-
action-to-transaction method cannot account for a pattern
of United States prices that differ significantly among
purchasers, regions, or time periods.” Appellee’s Br. 20
(citing SAA at 842–43).
Accordingly, the CIT correctly concluded that “[t]he
fact that the statute is silent with regard to administra-
tive reviews does not preclude Commerce from filling gaps
in the statute to properly calculate and assign antidump-
ing duties.” JBF RAK, 991 F. Supp. 2d at 1348.
B. The Targeted Dumping Allegation Was Timely Filed
Pursuant to 19 C.F.R. § 351.301 4
4 Citations to 19 C.F.R. in this opinion refer to the
2012 version, prior to the revisions that are reflected in
the 2013 version, unless otherwise noted.
JBF RAK LLC V. UNITED STATES 11
JBF RAK next argues “that [the domestic producers’]
untimely allegation of targeted dumping was improperly
considered in violation of the time requirements of 19
C.F.R. § 351.301.” Appellant’s Br. 13. JBF RAK first
contends the domestic producers’ targeted dumping
allegation was in violation of § 351.301(c), which provides
that rebuttal factual information must be filed within ten
days of service of factual information submitted by any
other interested party. See 19 C.F.R. § 351.301(c)(1).
Commerce did not categorize the targeted dumping al-
legation as “rebuttal factual information,” as covered by
§ 351.301(c)(1). J.A. 194 (“While [19 C.F.R.
§] 351.301(c)(1) pertains to rebuttal factual information,
[the domestic producers’] targeted dumping allegation
cannot reasonably be characterized as rebuttal factual
information, as JBF [RAK] claims.”). Commerce ex-
plained that though the “[domestic producers] used the
information on the record of this review for purposes of
advocating that [Commerce] consider using a different
method to compare normal value and export price (or
constructed export price),” that fact “does not transform
[the domestic producers’] allegation into the submission of
facts, for the facts that served as the basis for [the domes-
tic producers’] claim already were on the record.” J.A.
194–95.
JBF RAK nevertheless argues that “[a]ssuming that
the rebuttal facts must be ‘new,’ although there is no such
requirement in the regulation, the allegation herein
certainly adduced facts that were not evident from the
information on record. . . . Commerce made the question-
able assertion that reliance on record information cannot
be ‘new.’” Appellant’s Br. 16. However, JBF RAK points
to no evidence whatsoever supporting this assertion and
we accordingly afford it no weight. Because the targeted
dumping allegation did not present new “facts” for Com-
merce to consider, Commerce did not err in finding the
domestic producers’ allegation was timely.
12 JBF RAK LLC V. UNITED STATES
Additionally, 19 C.F.R. § 351.301 differentiates be-
tween “factual information” under § 351.301(c), and
“certain allegations” under § 351.301(d). Subsection (d)
detailed the timeline for submission of targeted dumping
allegations in investigations under the now-withdrawn
§ 351.301(d)(5) (2007). As Commerce found, the domestic
producers’ targeted dumping allegation was akin to
submissions under subsection (d). J.A. 195 (“Because the
nature of the filings listed in [19 C.F.R. §] 351.301(d)
closely resemble [domestic producers’] targeted dumping
allegation, (and in fact the now-withdrawn targeted
dumping allegation was listed under that very provision),
it stands to reason that [Commerce] properly considered
[domestic producers’] submission as an allegation and not
rebuttal factual information.” (footnote omitted)). Accord-
ingly, domestic producers’ targeted dumping allegations
were not included as part of the submissions covered by
subsection (c), but rather, were more closely related to
those of subsection (d).
C. The CIT Did Not Abuse Its Discretion When It Found
JBF RAK Failed to Exhaust Its Administrative Remedies
JBF RAK also contends Commerce erred in failing to
find the now-withdrawn 19 C.F.R. § 351.301(d)(5) (2007)
barred the domestic producers’ allegations of targeted
dumping. JBF RAK argues the CIT abused its discretion
when it held JBF RAK failed to exhaust its administra-
tive remedies, thereby “depriv[ing] Commerce of the
opportunity to ‘apply its expertise, rectify administrative
mistakes, and compile a record adequate for judicial
review—advancing the twin purposes of protecting ad-
ministrative agency authority and promoting judicial
efficiency.’” JBF RAK, 991 F. Supp. 2d at 1350 (citation
omitted).
Relatedly, JBF RAK argues the allegation was un-
timely under 19 C.F.R. § 351.301(b)(2) because factual
information is due “140 days after the last day of the
JBF RAK LLC V. UNITED STATES 13
anniversary month” in the final results of an administra-
tive review, and the domestic producers submitted their
targeted dumping allegation after that date.
JBF RAK did not cite to the time limits in 19 C.F.R.
§ 351.301(d)(5) or (b)(2) after either the Post-Preliminary
Determination or in its administrative briefing to argue
that these regulations precluded Commerce from consid-
ering the targeted dumping allegation. See J.A. 140–58,
171–87. Under 28 U.S.C. § 2637(d), the CIT “shall, where
appropriate, require the exhaustion of administrative
remedies” in civil actions arising from Commerce’s anti-
dumping duty determinations. The CIT “takes a ‘strict
view’ of the requirement that parties exhaust their ad-
ministrative remedies before [Commerce] in trade cases.”
Corus Staal BV v. United States, 502 F.3d 1370, 1379
(Fed. Cir. 2007). Because JBF RAK failed to raise these
issues before Commerce, the CIT correctly found it had
not exhausted its administrative remedies. See 19 C.F.R.
§ 351.309(c)(2) (“The case brief must present all argu-
ments that continue in the submitter’s view to be relevant
to [Commerce’s] final determination.”).
There are limited exceptions to the exhaustion doc-
trine. Essar Steel, Ltd. v. United States, 753 F.3d 1368,
1374 (Fed. Cir. 2014). JBF RAK argues a CIT case decid-
ed after the Final Results, Gold East Paper (Jiangsu) Co.,
v. United States, 918 F. Supp. 2d 1317 (Ct. Int’l Trade
2013), was an intervening legal authority that excused its
failure to exhaust on the theory that, until Gold East
Paper, JBF RAK thought that § 351.301(d)(5) of the
regulations had been effectively withdrawn. The CIT
addressed this argument, explaining it “presents an
interesting academic question but it is one the court need
not answer.” JBF RAK, 991 F. Supp. 2d at 1350. The
CIT held that, even if the regulation applied, “the gov-
ernment may waive its procedural deadlines under gen-
eral principles of administrative law.” Id. To overcome
these principles, JBF RAK was required to show “it was
14 JBF RAK LLC V. UNITED STATES
substantially prejudiced by Commerce’s supposed viola-
tion of its regulatory deadlines.” Id. On appeal, JBF RAK
contends “clearly JBF was substantially prejudiced by the
issuance of a second preliminary determination not au-
thorized under the statute,” Appellant’s Br. 14, however,
JBF RAK provides no further evidence or argument, and
we therefore find this contention unpersuasive.
In any event, in Gold East Paper, the CIT found that
Commerce improperly withdrew 19 C.F.R. § 351.414(f)(2)
(2007), not § 351.301(d)(5) (2007), the regulation at issue
in the instant case. See 918 F. Supp. 2d 1325–28. JBF
RAK argues that it did not know it could challenge the
withdrawal of § 351.301(d)(5) as inconsistent with the
Administrative Procedure Act until Gold East Paper.
Appellant’s Br. 22. However, “a litigant must diligently
protect its rights in order to be entitled to relief.”
Mukand Int’l, Ltd. v. United States, 502 F.3d 1366, 1370
(Fed. Cir. 2007). JBF RAK did not raise this issue before
Commerce and we will not address it here.
D. Commerce Did Not Err in Issuing the Post-Preliminary
Results
JBF RAK next argues Commerce acted ultra vires
when it issued the Post-Preliminary Determination
because 19 U.S.C. § 1675(a)(2)(B)(iv) and (C) provide for
only preliminary and final determinations. Appellant’s
Br. 24. The CIT rejected the claim as “a superficial legal
argument that ignores general principles of administra-
tive law.” JBF RAK, 991 F. Supp. 2d at 1352. This court
has stated that “‘[a]bsent constitutional constraints or
extremely compelling circumstances the administrative
agencies should be free to fashion their own rules of
procedure and to pursue methods of inquiry capable of
permitting them to discharge their multitudinous duties.’”
PSC VSMPO-Avisma Corp. v. United States, 688 F.3d
751, 760 (Fed. Cir. 2012) (quoting Vt. Yankee Nuclear
Power Corp. v. Natural Res. Def. Council, Inc., 435 U.S.
JBF RAK LLC V. UNITED STATES 15
519, 543–44 (1978)). Here, Commerce issued its Post-
Preliminary Determination, gave parties an opportunity
to comment, “and still managed to issue the Final Results
within the statutory time-frame.” JBF RAK, 991 F. Supp.
2d at 1353. Accordingly, the CIT correctly found that JBF
RAK was not prejudiced by Commerce’s decision to issue
a Post-Preliminary Determination.
E. Commerce’s Interpretation of 19 U.S.C. § 1677f-
1(d)(1)(B)(i) Is Reasonable
JBF RAK argues that “Commerce must consider evi-
dence that price patterns that meet the Nails Test[5] do
5 The Nails Test involves a two-step analysis:
In the first stage of the test, the “stand-
ard-deviation test,” [Commerce] determine[s]
the volume of the allegedly targeted group’s
(i.e., purchaser, region or time period) sales
of subject merchandise (by sales volume)
that are at prices more than one standard
deviation below the weighted-average price
of all sales under review, targeted and non-
targeted. . . . If that volume did not exceed
33 percent of the total volume of the re-
spondent’s sales of subject merchandise for
the allegedly targeted group, then [Com-
merce does] not conduct the second stage of
the Nails Test. If that volume exceeded 33
percent of the total volume of the respond-
ent’s sales of subject merchandise for the al-
legedly targeted group, on the other hand,
then [Commerce] proceed[s] to the second
stage of the Nails Test.
In the second stage, the “gap test,” we
examined all sales of identical merchandise
(i.e., by [control number]) sold to the alleged-
ly targeted group which passed the standard-
16 JBF RAK LLC V. UNITED STATES
not constitute targeted dumping.” Appellant’s Br. 26
(capitalization omitted) (italics added); see Certain Steel
Nails from the People’s Republic of China, 73 Fed. Reg.
33,977 (Dep’t of Commerce June 16, 2008) (final determi-
nation of sales at less than fair value and partial affirma-
tive determination of critical circumstances); Certain Steel
Nails from the United Arab Emirates, 73 Fed. Reg. 33,985
(Dep’t Commerce June 16, 2008) (notice of final determi-
nation of sales at not less than fair value).
deviation test. From those sales, [Com-
merce] determined the total volume of sales
for which the difference between the
weighted-average price of sales for allegedly
targeted group and the next higher
weighted-average price of sales to the non-
targeted groups exceeds the average price
gap (weighted by sales volume) for the non-
targeted groups. [Commerce] weight[s] each
of the price gaps between the non-targeted
groups by the combined sales volume associ-
ated with the pair of prices for the non-
targeted groups that defined the price gap.
In doing this analysis, the allegedly targeted
group’s sales were not included in the non-
targeted groups; the allegedly targeted
group’s average price was compared only to
the average prices for the non-targeted
groups. If the volume of the sales that met
this test exceeded five percent of the total
sales volume of subject merchandise to the
allegedly targeted group, then [Commerce]
determine[s] that targeting occurred and
these sales passed the Nails Test.
JBF RAK, 991 F. Supp. 2d at 1354 (citation omitted).
JBF RAK LLC V. UNITED STATES 17
According to JBF RAK, “because of its sales prac-
tice[s], it could not target customers, regions or periods of
time and the pricing pattern found by Commerce was the
result of market conditions.” Id. Thus, according to JBF
RAK, it was “arbitrary, capricious and an abuse of discre-
tion to refuse to consider evidence which would tend to
establish that the pricing pattern was not due to targeted
sales but, instead, was for a valid business purpose.” Id.
at 27. The CIT held that 19 U.S.C. § 1677f-1(d)(1)(B)
defines “targeted dumping” in terms of a pattern of export
prices, and that Commerce’s Nails Test reasonably de-
termines when such a pattern exists. JBF RAK, 991 F.
Supp. 2d 1355.
Section 1677f-1(d)(1)(B) does not require Commerce to
determine the reasons why there is a pattern of export
prices for comparable merchandise that differs signifi-
cantly among purchasers, regions, or time periods, nor
does it mandate which comparison methods Commerce
must use in administrative reviews. As a result, Com-
merce looks to its practices in antidumping duty investi-
gations for guidance. Here, the CIT did not err in finding
there is no intent requirement in the statute, and we
agree with the CIT that requiring Commerce to determine
the intent of a targeted dumping respondent “would
create a tremendous burden on Commerce that is not
required or suggested by the statute.” JBF RAK, 991 F.
Supp. 2d at 1355 (internal quotation marks and citation
omitted).
CONCLUSION
The court has considered JBF RAK’s other arguments
and finds them unpersuasive. For the reasons set forth
above, the decision of the CIT is
AFFIRMED