Ad Hoc Shrimp Trade Action Committee v. United States

Slip Op. 12 -36
UNITED STATES COURT OF INTERNATIONAL TRADE
AD HOC SHRIMP TRADE ACTION
COMMITTEE,
Plaintiff,
v.
Before: Donald C. Pogue,
UNITED STATES, Chief Judge
Defendant, Court No. 10-00275
and
HILLTOP INTERNATIONAL, and
OCEAN DUKE CORPORATION,
Defendant-Intervenors.
OPINION
[Affirming Department of Commerce’s remand redetermination]
Dated: March 20, 2012
Jordan C. Kahn, Andrew W. Kentz, Nathaniel J. Maandig
Rickard, and Kevin M. O’Connor, Picard Kentz & Rowe LLP, of
Washington, DC, for Plaintiff Ad Hoc Shrimp Trade Action
Committee.
Joshua E. Kurland, Trial Attorney, Commercial Litigation
Branch, Civil Division, U.S. Department of Justice, of
Washington, DC, for Defendant. With him on the briefs were Tony
West, Assistant Attorney General, Jeanne E. Davidson, Director,
Patricia M. McCarthy, Assistant Director. Of counsel on the
briefs was Shana Hofstetter, Attorney, Office of Chief Counsel
for Import Administration, U.S. Department of Commerce, of
Washington, DC.
Mark E. Pardo, Andrew T. Schutz, Brandon M. Petelin, and
Jeffrey O. Frank, Grunfeld, Desiderio, Lebowitz, Silverman &
Klestadt LLP, of Washington, DC, for the Defendant-Intervenors
Hilltop International and Ocean Duke Corporation.
Court No. 10-00275 Page 2
Pogue, Chief Judge: This case returns to the court
following remand by Ad Hoc Shrimp Trade Action Comm. v. United
States, __ CIT __, 791 F. Supp. 2d 1327 (2011) (“Ad Hoc I”). In
Ad Hoc I, the court reviewed the final results of the fourth
administrative review of the antidumping duty order covering
certain frozen warmwater shrimp from the People’s Republic of
China (“China”)1 and ordered the Department of Commerce (“the
Department” or “Commerce”) to further explain or reconsider its
decision to rely exclusively on Customs and Border Protection
Form 7501 data for entries designated as Type 032 (“Type 03 CBP
Data”) when selecting mandatory respondents in the review. Id. at
1334. In its Final Results of Redetermination Pursuant to Court
Remand, ECF No. 50 (“Remand Results”), Commerce found that Type
03 CBP Data remains the best available information and reaffirmed
its original determination. Remand Results at 28. Plaintiff
continues to dispute this result.
1
Certain Frozen Warmwater Shrimp from the People’s Republic
of China, 75 Fed. Reg. 49,460 (Dep’t Commerce Aug. 13, 2010)
(final results and partial rescission of antidumping duty
administrative review) (“Final Results”), and accompanying Issues
& Decision Memorandum, A-570-893, ARP 08–09 (Aug. 9, 2010),
Original Admin. R. Pub. Doc. 180 (adopted in Final Results, 75
Fed. Reg. at 49,460) (“I & D Mem.”).
2
“Type 03” entries are consumption entries designated upon
importation to be subject to an antidumping/countervailing duty.
See U.S. Customs and Border Protection, Dep’t of Homeland
Security, CBP Form 7501 Instructions 1 (Mar. 17, 2011), available
at http://forms.cbp.gov/pdf/7501_instructions.pdf (last visited
Mar. 13, 2012) (“Form 7501 Instructions”).
Court No. 10-00275 Page 3
For the reasons that follow, the court affirms Commerce’s
decision to rely exclusively on Type 03 CBP Data as compliant
with the remand order and supported by a reasonable reading of
the record evidence.
The court has jurisdiction pursuant to § 516A of the Tariff
Act of 1930, as amended, 19 U.S.C. § 1516a (2006)3 and 28 U.S.C.
§ 1581(c) (2006).
BACKGROUND
The facts necessary to the disposition of Plaintiff’s
request for review of the Remand Results are the following:4
In the administrative review at issue, Commerce relied
exclusively on Type 03 CBP Data to determine the largest
exporters by volume when choosing mandatory respondents.
Ad Hoc I, __ CIT at __, 791 F. Supp. 2d at 1332; see also 19
U.S.C. § 1677f-1(c)(2)(B) (permitting Commerce to limit
individual review of respondents to the largest exporters by
volume under certain circumstances). Ad Hoc Shrimp Trade Action
Committee (“AHSTAC”) challenged that decision before the
Department, arguing that the Type 03 CBP Data was unreliable and
did not accurately reflect the actual volume of subject imports;
3
All subsequent citations to the Tariff Act of 1930, as
amended, are to Title 19 of the U.S. Code, 2006 edition.
4
Familiarity with the court’s prior decision is presumed.
Court No. 10-00275 Page 4
therefore, Type 03 CBP Data did not form a reasonable data set
for respondent selection. Ad Hoc I, __ CIT at __, 791 F. Supp. 2d
at 1330–31. In support of its position, AHSTAC placed on the
record: (1) the final results of the third administrative review
of this antidumping duty order, detailing discrepancies between
the Type 03 CBP Data and verified import data for respondent
Zhanjiang Regal Integrated Marine Resources Co., Ltd. (“Regal AR3
Verification”);5 (2) alternative import data sets — U.S. Census
Import Data (“IM-145 Data”)6 and Automated Manifest Data (“AMS
Data”)7 — showing import volume discrepancies when compared with
Type 03 CBP Data; and (3) two reports to Congress — a United
States Customs and Border Protection report (“CBP Report”)8 and a
5
Certain Frozen Warmwater Shrimp from the People’s Republic
of China, 74 Fed. Reg. 46,565 (Dep’t Commerce Sept. 10, 2009)
(final results and partial rescission of antidumping duty
administrative review) (“AR3 Final Results”), and accompanying
Issues & Decision Memorandum, A-570-893, ARP 07–08, Cmt. 7 at
23–24 (Aug. 28, 2009) (adopted in AR3 Final Results, 74 Fed. Reg.
at 46,566) (“AR3 I & D Mem.”).
6
A summary of the IM-145 Data was provided by AHSTAC in its
comments on respondent selection. Comments on Resp’t Selection,
A-570-893, ARP 08–09 (Apr. 9, 2009), Original Admin. R. Con. Doc.
3 [Pub. Doc. 18], Ex. 3 (“AHSTAC’s Apr. 9, 2009 Comments”).
7
A summary of the AMS Data was provided in the comments on
respondent selection submitted by the American Shrimp Processor’s
Association (“ASPA”) and the Louisiana Shrimp Association
(“LSA”). Comments on Resp’t Selection, A-570-893, ARP 08–09 (Apr.
10, 2009), Original Admin. R. Con. Doc. 2 [Pub. Doc. 20], Ex. 2
(“ASPA’s & LSA’s Apr. 10, 2009 Comments).
8
U.S. Customs and Border Protection, Report to Congress on
(1) U.S. Customs and Border Protection’s Plans to Increase AD/CVD
Collections and (2) AD/CVD Enforcement Actions and Compliance
Court No. 10-00275 Page 5
U.S. Government Accountability Office Report (“GAO Report”)9 —
discussing investigations into misclassification and
transshipment of Chinese shrimp imports to the United States.
Commerce refused to consider AHSTAC’s evidence and relied
exclusively on Type 03 CBP Data in the Final Results. Ad Hoc I,
__ CIT at __, 791 F. Supp. 2d at 1331–32.
AHSTAC subsequently challenged Commerce’s determination
before this court. Ruling on that challenge, Ad Hoc I held —
with specific reference to the Regal AR3 Verification — that
“[b]ecause Commerce failed to take into account record evidence
that fairly detracts from the weight of the evidence supporting
its POR subject entry volume determinations, these determinations
are not supported by substantial evidence.” Id. at 1334. The
court remanded the Final Results to Commerce to “take into
account the record evidence of significant entry volume
inaccuracies in Type 03 CBP Form 7501 data . . . and explain why
it is nevertheless reasonable to conclude that the Type 03 CBP
Form 7501 data used in this case are not similarly inaccurate,
and/or otherwise reconsider its determination.” Id.Initiatives, reprinted in AHSTAC’s Apr. 9, 2009 Comments, Ex. 1.
9
U.S. Gov’t Accountability Office, Seafood Fraud: FDA
Program Changes and Better Collaboration Among Key Federal
Agencies Could Improve Detection and Prevention (2009), reprinted
in AHSTAC’s Apr. 9, 2009 Comments, Ex. 2.
Court No. 10-00275 Page 6
STANDARD OF REVIEW
“The court will sustain the Department’s determination upon
remand if it complies with the court’s remand order, is supported
by substantial evidence on the record, and is otherwise in
accordance with law.” Jinan Yipin Corp. v. United States, __ CIT
__, 637 F. Supp. 2d 1183, 1185 (2009) (citing 19 U.S.C.
§ 1516a(b)(1)(B)(1)).
Substantial evidence is “such relevant evidence as a
reasonable mind might accept as adequate to support a
conclusion,” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229
(1938), “tak[ing] into account whatever in the record fairly
detracts from its weight,” Universal Camera Corp. v. NLRB, 340
U.S. 474, 488 (1951). In brief, the substantial evidence
standard asks whether, based on the record evidence as a whole,
the agency’s action was reasonable. Nippon Steel Corp. v. United
States, 458 F.3d 1345, 1351 (Fed. Cir. 2006).
DISCUSSION
In Ad Hoc I, Commerce failed to take into account the record
evidence as a whole. Ad Hoc I, __ CIT at __, 791 F. Supp. 2d at1333–34. In particular, Commerce failed to consider evidence on
the record that detracted from the reliability of the Type 03 CBP
Data. Id. at 1334. By not considering this evidence, Commerce
failed to meet the basic requirements of the substantial evidence
Court No. 10-00275 Page 7
test, see Universal Camera, 340 U.S. at 488, so the court
remanded the determination to Commerce to:
take into account the record evidence of significant
entry volume inaccuracies in Type 03 CBP Form 7501 data
for merchandise subject to this antidumping duty order,
and explain why it is nevertheless reasonable to
conclude that the Type 03 CBP Form 7501 data used in
this case are not similarly inaccurate, and/or
otherwise reconsider its determination,
Ad Hoc I, __ CIT at __, 791 F. Supp. 2d at 1334.
In the Remand Results, Commerce considered the evidence of
inaccuracies that AHSTAC submitted and concluded that “the Type
03 data [relied upon in this review] is reliable and not
similarly inaccurate, and remains the best available on which to
base respondent selection.” Remand Results at 4. Thus, Commerce
has considered the evidence of inaccuracy, as required by the
remand order, and the court must now decide whether the
Department’s decision to continue relying upon Type 03 CBP Data
is reasonable. See Nippon Steel, 438 F.3d at 1351.
In making such a determination the court does not substitute
its judgment for that of the agency. As the Court of Appeals for
the Federal Circuit has stated:
Although a reviewing court must take into account
contradictory evidence or any evidence in the record that
undermines the agency’s finding, the substantial evidence
test does not require that there be an absence of evidence
detracting from the agency’s conclusion, nor is there an
absence of substantial evidence simply because the reviewing
court would have reached a different conclusion based on the
same record.
Cleo Inc. v. United States, 501 F.3d 1291, 1296 (Fed. Cir. 2007)
Court No. 10-00275 Page 8
(citing Universal Camera, 340 U.S. at 487–88).
The court will examine whether Commerce’s decision is
supported by substantial evidence, first, in light of the
conflicting evidence AHSTAC presents and, second, in light of the
alternative data sets AHSTAC seeks. In the third part of the
opinion, the court will address AHSTAC’s challenge to Commerce’s
policy of reviewing only respondents that have suspended entries.
I. The Evidence of Inaccuracies in Type 03 CBP Data Is
Insufficient to Render Commerce’s Determination Unreasonable
AHSTAC has consistently challenged the Department’s use of
Type 03 CBP Data in this review by presenting three categories of
evidence demonstrating what AHSTAC believes to be the
unreliability of the Type 03 CBP Data: (1) the Regal AR3
Verification; (2) the IM-145 and AMS Data; and (3) the CBP and
GAO Reports to Congress. AHSTAC now challenges the Remand
Results on these same grounds, arguing that the Department’s
redetermination is unreasonable in light of the evidence on the
record that the Type 03 CBP Data is unreliable. The court will
treat each category of evidence in turn.
A. The Regal AR3 Verification is Unpersuasive in Light of
the Fourth Administrative Review Verification
The first category of evidence AHSTAC submits is a finding
from the third administrative review detailing inaccuracies in
the Type 03 CBP Data. In particular, when Commerce verified
respondent Regal’s data in the third administrative review, the
Court No. 10-00275 Page 9
Department found significant discrepancies in import volumes of
subject merchandise compared with those reported on Form 7501.
AR3 I & D Mem. Cmt. 7 at 23. The court in Ad Hoc I gave
particular attention to this fact when ordering the remand:
The fact that, in the immediately preceding review,
Commerce discovered significant inaccuracies,[10]
undetected by Customs, in the CBP entry volume data for
subject merchandise from the very same respondents as
those covered in this review casts sufficient doubt on
the presumption that Customs has assured the accuracy
of such data for this POR.
Ad Hoc I, __ CIT at __, 791 F. Supp. 2d at 1333.
Following verification in the fourth administrative review,
however, Commerce found no such discrepancy. As the Department
states in the Remand Results, “the record for AR4 shows that
Regal’s reported volume of subject exports, while not identical,
is reasonably consistent with the volume provided in CBP Type 03
data.” Remand Results at 14. While the results of the third
administrative review did “cast doubt” on the accuracy of the
Type 03 CBP Data used in the fourth administrative review, such
doubt was subsequently resolved by the verified results of the
fourth administrative review. Thus, the court finds reasonable
Commerce’s statement that,
as Regal was fully reviewed in this fourth
administrative review period, and the Department did
not find any evidence that Regal misreported or
underreported any sales of subject merchandise, we find
10
As Commerce notes in the Remand Results, the inaccuracies
were limited to a single respondent, Regal. Remand Results at 13.
Court No. 10-00275 Page 10
that Petitioner’s speculative argument regarding
Regal’s purported continuation of misreporting of sales
is unfounded, based on the record evidence of this
review period.
Remand Results at 25.
AHSTAC argues that the discrepancy discovered in the third
administrative review represents widespread misclassification by
importers. Pl. Ad Hoc Shrimp Trade Action Comm.’s Comments on
Final Results of Redetermination Pursuant to Court Remand at
25–26, ECF No. 54 (“Pl.’s Comments”). AHSTAC’s argument is
premised on the bifurcation of responsibility between the
respondent exporter/producer, whose records are verified in the
administrative review, and the importer, who is responsible for
completing Form 7501. According to AHSTAC’s theory, the
discrepancy discovered in the third administrative review means
that importers should be presumed to be misclassifying imports
until “record evidence demonstrates otherwise,” Id. at 25.
AHSTAC further argues that, as Regal is not an importer, evidence
that misclassification has been corrected vis-a-vis Regal’s
merchandise does not prove that importers, generally, are not
continuing to misclassify.
This argument is inconsistent with the record evidence in
the current review. The record shows that in the third
administrative review, the Type 03 CBP Data for Regal was
inaccurate; however, in the fourth administrative review that
inaccuracy was not present. Though it is true that the
Court No. 10-00275 Page 11
“determination of data inaccuracies in a separate review of the
same producer/exporter, subject to the same antidumping duty
order, casts doubt on similar data regarding such
producer/exporter in an adjacent review,” Ad Hoc I, __ CIT at __,
791 F. Supp. 2d at 1333 (construing Home Products Int’l, Inc. v.
United States, 633 F.3d 1369, 1380–81 (Fed. Cir. 2011)), evidence
from the latter review showing that the inaccuracy no longer
exists resolves such doubt. Thus, evidence that an importer
inaccurately completed Form 7501 in a prior review but did not
perpetuate similar inaccuracies in the review at issue is
insufficient to impugn the behavior of importers generally or the
reliability of the data. The CBP data is presumed to be
collected according to standards of regularity and, unless that
presumption is rebutted, such data may be considered reliable.
Pakfood Public Co. v. United States, __ CIT __, 753 F. Supp. 2d
1334, 1345–46 (2011). In light of the accuracy of the Type 03
CBP Data for Regal in the fourth administrative review, the
presumption stands for that review.
The Regal AR3 Verification was singled out in Ad Hoc I as
relevant and persuasive because it pointed to specific and
determinable evidence of unreliability in the Type 03 CBP Data.
Given the lack of inaccuracy in the fourth administrative review,
the prior inaccuracy is no longer persuasive. Therefore, the
court turns to the more generalized evidence of inaccuracy put
Court No. 10-00275 Page 12
forward by AHSTAC. Though it was not directly addressed in Ad
Hoc I, the court will turn first to the IM-145 and AMS Data.
B. Inconsistency Between the IM-145/AMS Data and Type 03
CBP Data Is Not an Indication of Unreliability
AHSTAC argues that discrepancies between import volumes
listed in the Type 03 CBP Data and the IM-145/AMS Data indicate
that misclassification by importers has rendered the Type 03 CBP
Data inaccurate. According to AHSTAC, because import volumes
listed in the IM-145 Data are larger than in the Type 03 CBP
Data, importers must be misclassifying imports on Form 7501 as
non-subject merchandise. Pl.’s Comments at 31. AHSTAC further
argues that the AMS data shows a growth in imports from
Zhangjiang Guolian Aquatic Products Co., Ltd. (“Guolian”), which
is not subject to the antidumping duty order, and that this
indicates a likelihood that importers are misclassifying imports
from producers/exporters subject to the antidumping duty order as
imports from Guolian. Id. at 31–32.
Commerce responds to AHSTAC by arguing that the IM-145 Data
is not limited to subject imports; therefore, discrepancies
between IM-145 Data and Type 03 CBP Data may result from the
overinclusivness of the IM-145 Data rather than from
misclassification. Def.’s Response to Pl.’s Remand Comments at
8–9, ECF No. 60 (“Def.’s Reply”). This analysis is reasonable.
Because the IM-145 data is based on Harmonized Tariff Schedule of
the United States(“HTSUS”) categories covering a broader range of
Court No. 10-00275 Page 13
merchandise than that subject to the antidumping duty order, it
is not only unsurprising but expected that the IM-145 Data would
show a positive volume discrepancy when compared to the Type 03
CBP Data. Therefore, such discrepancy does not impugn the
reliability of the Type 03 CBP Data.11
For similar reasons, Commerce’s decision not to rely upon
the discrepancy between the AMS Data and the Type 03 CBP Data is
also reasonable. According to AHSTAC, the growth in imports from
Guolian, which is not subject to the order, suggests that
importers are misclassifying merchandise from exporters/producers
subject to the order as merchandise from Guolian to avoid duties.
Such an explanation is plausible. However, Commerce puts forward
an equally plausible explanation that “an excluded company like
Zhangjiang Guolian logically would be competitive vis-a-vis other
exporters subject to the order because its merchandise would
naturally not be subject to antidumping duty cash deposit
collection, suspension, or liquidation.” Def.’s Reply at 9–10;
see also Consolo v. Fed. Maritime Comm’n, 383 U.S. 607, 620
11
AHSTAC suggests that Commerce could “assess the extent to
which these data are over-inclusive and rely on such analysis to
support its decision-making.” Pl.’s Comments at 31. However,
because the discrepancy between the IM-145 Data and the Type 03
CBP Data does not impugn the Type 03 CBP Data’s reliability,
there is no reason to burden Commerce with such analysis.
Furthermore, Commerce notes that, “[d]espite Ad Hoc’s claim,
Commerce has no way of getting behind the data and excluding non-
subject merchandise.” Def.’s Reply at 9. Nor does AHSTAC provide
any suggested methodology.
Court No. 10-00275 Page 14
(1966) (“[T]he possibility of drawing two inconsistent
conclusions from the evidence does not prevent an administrative
agency’s finding from being supported by substantial evidence.”).
C. The Reports to Congress Alone Are Insufficient to
Challenge the Presumption of Reliability
Finally, AHSTAC argues that two reports to Congress, the CBP
Report and the GAO Report, show ongoing problems of
misclassification and transshipment, which suggests that the
Chinese shrimp industry is “structured such that there is a
likelihood of entry misclassification.” Pl.’s Comments at 22.
Though these reports show that both misclassification and
transshipment of Chinese shrimp exported to the U.S. has occurred
in the past, they do not indicate current inaccuracies in the
Type 03 CBP Data used for the fourth administrative review; nor
do they indicate ongoing problems. First, the reports predate
the administrative review at issue here.12 Second, the reports
do not indicate misclassification or transshipment specifically
relevant to the determination of mandatory respondents in the
fourth administrative review. Finally, issues noted in the
reports were subsequently addressed through enforcement actions.
While no one of these facts is necessarily fatal to Plaintiff’s
12
While it is understandable that there is a lag time
between when conduct occurs and when the report detailing the
investigation of that conduct becomes public, see Pl.’s Comments
at 22, this fact does not render the reports an account of the
contemporary situation.
Court No. 10-00275 Page 15
argument, combined they significantly diminish the weight to be
given the reports as evidence of irregularity in the fourth
administrative review.
In light of these facts, it is simply not true that “[t]hese
government reports vanquished the presumption of regularity
ordinarily afforded to Type 03 CBP data and required Commerce to
support its respondent selection with substantial evidence.” Id.at 24 (citing Ad Hoc I, __ CIT at __, 791 F. Supp. 2d at 1331–34,
1337). Rather, in Ad Hoc I, the court found that in light of all
the evidence put forward by AHSTAC, but particularly in light of
the Regal AR3 Verification evidence, the presumptive reliability
of the Type 03 CBP Data was “call[ed] into question.” Ad Hoc I,
__ CIT at __, 791 F. Supp. 2d at 1332–33. Because the Regal AR3
Verification is no longer persuasive and the IM-145/AMS Data is
likewise unpersuasive, the CBP and GAO Reports must stand on
their own. However, given the limitations on the applicability
of the CBP and GAO Reports noted above, these reports are
insufficient to impugn the presumption of regularity. See Seneca
Grape Juice Corp. v. United States, 71 Cust. Ct. 131, 142, C.D.
4486, 367 F. Supp. 1396, 1404 (1973) (“In the absence of clear
evidence to the contrary, the courts presume that public officers
have properly discharged their duties . . . .”).
Having determined that Commerce’s reliance on the Type 03
CBP Data is supported by a reasonable reading of record evidence,
Court No. 10-00275 Page 16
the court now turns to whether Commerce’s choice among
alternative data sets was also reasonable.
II. The Court Defers to Commerce’s Reasonable Choice Among
Alternative Data Sets
In addition to its arguments challenging the reliability of
the Type 03 CBP Data, discussed above, AHSTAC also contends that
Commerce should either release Type 01 CBP data13 to corroborate
the Type 03 CBP Data or employ Quantity and Value Questionnaires
(“Q&V Questionnaires”) because Q&V Questionnaires provide a more
complete, thorough, and accurate accounting of import volumes.
Where, as here, Commerce’s decision is supported by a
reasonable reading of record evidence, see supra Part I, the
court will not upset Commerce’s reasonable choice among
alternative data sets, even if they may be available. Cf. Peer
Bearing Co.-Changshan v. United States, 27 CIT 1763, 1770, 298 F.
Supp. 2d 1328, 1336 (2003) (“The Court’s role in this case is not
to evaluate whether the information Commerce used was the best
available, but rather whether Commerce’s choice of information is
reasonable.”); see also Nucor v. United States, __ CIT __, 594 F.
Supp. 2d 1320, 1356 (2008) (“It is well-established that it is an
agency’s domain to weigh the evidence; therefore this Court must
not upset the [agency’s] reasonable conclusions supported by
13
Type 01 CBP data includes consumption entries designated
upon importation as free and dutiable on Form 7501. See Form 7501
Instructions, supra, at 1.
Court No. 10-00275 Page 17
substantial evidence . . . .”).
Furthermore, the court finds unpersuasive AHSTAC’s arguments
for the necessity and/or advantage of the alternative data sets.
With regard to Type 01 CBP data, the court is not convinced that
the release of such data is required. Though the court noted in
Ad Hoc I, that “one way to corroborate the accuracy of CBP Type
03 entry volume data without undue administrative burden is to
compare such data with CBP Type 01 entry volume data . . . ,” Ad
Hoc I, __ CIT at __, 791 F. Supp. 2d at 1334 n.19, this statement
was a suggestion, not a mandate, to Commerce. The court is now
convinced by Commerce’s argument in the Remand Results that
“[t]he classification itself does not yield any specific
information that would assist the Department in expeditiously
determining whether merchandise should have been reported as Type
03, or making any modifications to the Type 03 data for purposes
of respondent selection.” Remand Results at 15.14 This is
particularly the case in light of the fact that Plaintiff offered
no further suggestions on how Type 01 data would be used in its
14
Commerce goes on to explain that
[t]ype 01 and Type 03 data are, by definition, mutually
exclusive. Type 01 data are comprised of entries
classified as non-subject merchandise; Type 03 data are
comprised of entries classified as subject merchandise.
The Department does not know, and Petitioners do not
suggest, a way that the two datasets could be used to
verify or corroborate each other.
Remand Results at 23.
Court No. 10-00275 Page 18
Comments.
Regarding Q&V Questionnaires, the court finds unpersuasive
the Department’s argument that Q&V Questionnaires would not
provide more accurate data. In support of its position, Commerce
contends that “[i]f respondents and/or their importers
participate in widespread misclassification schemes, they are
unlikely to provide information in Q&V responses that are
materially different from the data reported on CF-7501 as Type
03.” Remand Results at 17. Commerce fails to address AHSTAC’s
well argued point that Form 7501 is completed by importers, while
Q&V Questionnaires are completed by exporters/producers with more
direct knowledge of merchandise and the channels of shipment; any
suggestion by Commerce that misclassification on Form 7501 is the
product of collusion between importers and exporters is mere
speculation. Nor has Commerce addressed the fact that Q&V
Questionnaires are simply more comprehensive and thorough for
gathering relevant information than Form 7501.
Nonetheless, Commerce’s decision not to use Q&V
Questionnaires is a reasonable concession to administrative
convenience. Under these circumstances, Commerce has a valid
concern regarding the relative burdens placed on the Department
by Q&V Questionnaires versus Type 03 CBP Data,15 and
15
“Relying on Q&V responses requires significant resources,
and time, to send and track the delivery of Q&V questionnaires
and responses, to issue follow-up questionnaires when
Court No. 10-00275 Page 19
“[a]dministrative convenience of the government constitutes a
reasonable and rational basis for agency action.” Pakfood, __ CIT
at __, 753 F. Supp. 2d at 1343.
For these reasons, Commerce’s decision to rely exclusively
on Type 03 CBP Data rather than on other possible data sets is
reasonable. The court now turns to the final issue, i.e.,
whether Commerce must review respondents with no suspended
entries.
III. Whether Commerce May Limit Review to Only Respondents with
Suspended Entries Is Not Ripe in this Case
The court remanded this case to Commerce to address AHSTAC’s
challenges to the reliability of the Type 03 CBP Data; however,
in the post-remand briefing, a second issue emerged: whether
Commerce may limit review to respondents with suspended entries.
The issue arises from Commerce’s statement in the Remand Results
that “[i]t is [the] Department’s longstanding practice to not
conduct reviews for companies that do not have any suspended
entries because there are no entries for which the Department can
issue assessment instructions.” Remand Results at 5.
AHSTAC challenges Commerce’s articulated policy on several
grounds. First, AHSTAC asserts that such a policy “delegates the
determination of whether merchandise is covered by an AD order to
appropriate, and to aggregate and analyze the numerous responses.
The review covers nearly 500 companies, most of which were
requested by Petitioner.” Remand Results at 17.
Court No. 10-00275 Page 20
importers who alone decide whether to identify merchandise as
Type 03 on CF 7501.” Pl.’s Comments at 10. Next, AHSTAC asserts
that Commerce is putting forward a theory that “duties cannot be
recovered on unsuspended entries.” Id.16 Finally, AHSTAC argues
that this theory is contrary to the statutory requirement that
“‘if the United States has been deprived of duties,’ CBP ‘shall
require such lawful duties . . . be restored,’” Id. (quoting 19
U.S.C. § 1592(d)), and that it is not a longstanding agency
practice, Id. at 14–16.
Though both sides address considerable argument to these
concerns, the controversy is not ripe on the facts of this case.
As the Court of Appeals for the Federal Circuit has noted:
The doctrine of ripeness is designed “to prevent the
courts, through avoidance of premature adjudication,
16
This argument is premised on Commerce’s response to
AHSTAC’s comments on the Draft Remand Results. AHSTAC quotes
from the Remand Results, noting “AHSTAC alerted Commerce to this
problematic legal interpretation [in comments on the Draft Remand
Results], prompting the agency to respond as follows:
The Department’s statement was not an admission that
importers control the scope of an administrative
review. The point, instead, was that the Department
does not waste administrative resources by conducting a
full review that will not result in the assessment of
duties. . . . A policy whereby the Department would
expend considerable resources to determine whether or
not entries should have been suspended but were not,
and to determine the amount of dumping entries for
which assessment cannot be effectuated would be futile
exercise.
Pl.’s Comments at 10 (quoting Remand Results at 19-20 (footnote
omitted)) (emphasis added in Pl.’s Comments).
Court No. 10-00275 Page 21
from entangling themselves in abstract disagreements
over administrative policies, and also to protect the
agencies from judicial interference until an
administrative decision has been formalized and its
effects felt in a concrete way by the challenging
parties.”
Eurodif S.A. v. United States, 506 F.3d 1051, 1054 (Fed. Cir.
2007) (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 148–49
(1967), rev’d on other grounds, United States v. Eurodif S.A.,
555 U.S. 305 (2009)).
AHSTAC’s challenge to Commerce’s policy statement is not
ripe because the record does not support the existence of a
controversy on this issue. AHSTAC does not allege, nor has the
court discovered, specific facts to support the contention that
any respondent avoided review by misclassifying its entries as
not subject to suspension.17 More precisely for the purpose of
this case, AHSTAC has not alleged that any respondents were
excluded from the mandatory respondent selection process for
failing to have any suspended entries.18 Finally, AHSTAC dos not
allege, except in the most general terms, that any unsuspended
17
The court notes that the review was rescinded as to
several companies upon receipt of no shipment certifications,
which Commerce determined were accurate. Final Results, 75 Fed.
Reg. at 49,460, 49,462. If AHSTAC is challenging this practice,
it does not make such clear in its briefs.
18
As AHSTAC notes in its Comments, whether Commerce will
review a respondent with no suspended entries is irrelevant to
the issue of whether Commerce’s mandatory respondent selection
was supported by substantial evidence, and therefore not before
the court for adjudication. See Pl.’s Comments at 13–14.
Court No. 10-00275 Page 22
entries have led to the non-recovery of duties owed. Without
specific factual allegations of the practice AHSTAC challenges,
there is no actual controversy for the court to decide.
The lack of ripeness in this case is manifest in the
disconnect between the parties’ briefs. AHSTAC accuses Commerce
of delegating the determination of dutiable merchandise to
importers and arguing that duties are unrecoverable on
unsuspended entries. Pl.’s Comments at 10. Commerce denies that
these are its policies and argues in return that AHSTAC is
seeking to use the review process as a forum for investigation
and enforcement of fraud and negligence — responsibilities
delegated to Customs not Commerce. Def.’s Reply at 15. This is
just the sort of “abstract disagreement[] over administrative
polic[y]” that the courts should avoid. Eurodif, 506 F.3d at
1054. Without an actual controversy, it is both difficult and
imprudent for the court to intervene — not only are the relevant
considerations obfuscated in the abstract, but the impact of the
court’s action is unknowable.
Contrary to AHSTAC’s assertion, the Remand Results do not
“hinge” on Commerce’s practice regarding review of unsuspended
entries. Pl.’s Comments at 16–17. Rather, the Remand Results
hinge on whether the Type 03 CBP Data is a reasonable basis for
determining the largest exporters by volume, pursuant to 19
U.S.C. § 1677f-1(c)(2)(B). It is not necessary for the court to
Court No. 10-00275 Page 23
address the former issue in order to render a decision on the
latter.19 Nor does the court consider it wise to intervene in
such an unripe dispute. See Eurodif, 506 F.3d at 1054 (“[The
doctrine of ripeness] is drawn ‘both from Article III limitations
on judicial power and from prudential reasons for refusing to
exercise jurisdiction, but, even in a case raising only
prudential concerns, the question of ripeness may be considered
on a court’s own motion.” (quoting Nat’l Park Hospitality Ass’n
v. Dep’t of Interior, 538 U.S. 803, 808 (2003))).
CONCLUSION
For all the foregoing reasons, the Department’s Final
Results, 75 Fed. Reg. 49,460, as explained by the Remand Results,
will be affirmed.
Judgment will be entered accordingly.
It is SO ORDERED.
/s/ Donald C. Pogue
Donald C. Pogue, Chief Judge
Dated: March 20, 2012
New York, New York
19
Because the court finds that the use of Type 03 CBP Data
is supported by substantial evidence, it also does not reach
Commerce’s argument that failure to enjoin all liquidations in
this review renders moot the possibility of redetermining the
mandatory respondents using data other than Type 03 CBP Data. See
Remand Results at 20–21.