Husteel Co. v. United States

Slip Op. 20-103
UNITED STATES COURT OF INTERNATIONAL TRADE
HUSTEEL CO., LTD. ET AL.,
Plaintiff and Consolidated
Plaintiffs,
v.
UNITED STATES, Before: Claire R. Kelly, Judge
Defendant, Consol. Court No. 18-00169
and
CALIFORNIA STEEL INDUSTRIES ET
AL.,
Defendant-Intervenors and
Consolidated Defendant-
Intervenors.
OPINION AND ORDER
[Sustaining in part and remanding in part Commerce’s remand results in the first
administrative review of the antidumping duty order covering welded line pipe from
the Republic of Korea.]
Dated: July 23, 2020
Donald B. Cameron, Morris, Manning & Martin LLP, of Washington, DC, for plaintiff
Husteel Co., Ltd. With him on the brief were Julie C. Mendoza, R. Will Planert, Brady
W. Mills, Mary S. Hodgins, and Eugene Degnan.
J. David Park, Arnold & Porter Kaye Scholer LLP, of Washington, DC, for
consolidated plaintiffs Hyundai Steel Company and NEXTEEL Co., Ltd. With him on
the brief were Henry D. Almond, Daniel R. Wilson, and Kang W. Lee.
Consol. Court No. 18-00169 Page 2
Jeffrey M. Winton, Law Office of Winton & Chapman PLLC, of Washington, DC, for
consolidated plaintiff SeAH Steel Corporation. With him on the brief was Amrietha
Nellan.
Joshua E. Kurland, Trial Attorney, Commercial Litigation Branch, Civil Division,
U.S. Department of Justice, of Washington, DC, for Defendant. With him on the brief
were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and
L. Misha Preheim, Assistant Director. Of Counsel was Reza Karamloo, Senior
Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S.
Department of Commerce, of Washington, DC.
Elizabeth J. Drake, Schagrin Associates, of Washington, DC, for defendant-
intervenors California Steel Industries and Welspun Tubular LLC USA. With her on
the brief was Roger B. Schagrin.
Gregory J. Spak, White & Case LLP, of Washington, DC, argued for defendant-
intervenors Maverick Tube Corporation and IPSCO Tubulars Inc. With him on the
brief were Frank J. Schweitzer, Kristina Zissis, and Luca Bertazzo.
Kelly, Judge: Before the court is the U.S. Department of Commerce’s
(“Commerce”) remand redetermination filed pursuant to the court’s order in Husteel
Co. v. United States, 44 CIT __, __, 426 F. Supp. 3d 1376, 1395 (2020) (“Husteel I”).
See Final Results of Redetermination Pursuant to Ct. Remand [in Husteel I], Apr. 1,
2020, ECF No. 124 (“Remand Results”).
In Husteel I, the court remanded Commerce’s final determination in the first
administrative review of the antidumping duty (“ADD”) order covering welded line
pipe (“WLP”) from the Republic of Korea (“Korea”). See Welded Line Pipe from the
Republic of Korea, 83 Fed. Reg. 33,919 (Dep’t Commerce July 18, 2018) (final results
of [ADD] admin. review; 2015–2016 ) (“Final Results”) as amended by Welded Line
Pipe from the Republic of Korea, 83 Fed. Reg. 39,682 (Dep’t Commerce Aug. 10, 2018)
(amended final results of [ADD] admin. review; 2015–2016) (“Amended Final
Consol. Court No. 18-00169 Page 3
Results”) and accompanying Issues and Decisions Memo. for the Final Results of the
2015–2016 Admin. Review of the [ADD] Order on Welded Line Pipe from Korea, A-
580-876, (July 11, 2018), ECF No. 25-5 (“Final Decision Memo”).
On remand, Commerce reverses its determination that a particular market
situation (“PMS”) exists in Korea warranting an adjustment to respondents’ reported
costs of hot rolled coil (“HRC”). See Remand Results at 5, 7–8. Further, Commerce
reverses its determination that SeAH Steel Corporation’s (“SeAH”) sales into the
Canadian market were unrepresentative and uses those third-country sales to
determine SeAH’s normal value. See Remand Results at 4, 6–7. Finally, Commerce
declines to apply a constructed export price offset (“CEP offset”) to SeAH’s sales into
the Canadian market. See Remand Results at 9. For the following reasons, the court
sustains Commerce’s decision to reverse its PMS determination and to calculate
SeAH’s normal value using third country sales. However, the court remands
Commerce’s determination not to apply a CEP offset to SeAH’s Canadian sales for
further explanation or reconsideration.
BACKGROUND
The court presumes familiarity with the facts of this case as set out in its
previous opinion ordering remand to Commerce, and now recounts those facts
relevant to the court’s review of the Remand Results. See Husteel I, 44 CIT at __,
426 F. Supp. 3d at 1380–82. On August 10, 2018, Commerce published its Amended
Final Results. Amended Final Results, 83 Fed. Reg. at 39,682. Commerce
Consol. Court No. 18-00169 Page 4
determined that a PMS distorted the cost of production (“COP”) of WLP and
accounted for that distortion by upwardly adjusting SeAH and Hyundai Steel
Company’s (“Hyundai”) reported costs of HRC—an input used to produce WLP—for
purposes of determining the normal value of respondents’ sales of WLP. See Final
Decision Memo at 12–18. Commerce relied on the cumulative effect of Chinese steel
overcapacity, Korean HRC subsidies, strategic alliances between Korean HRC
producers, and government involvement in the Korean electricity market to justify
its determination. See id. at 12–13.
When determining the normal value of Hyundai’s U.S. sales of WLP,
Commerce relied on home market prices, but applied the PMS adjustment to
Hyundai’s reported costs for purposes of determining whether sales were made below
cost. See Final Decision Memo at 4, 14–15 & nn. 67–68; Remand Results at 1–2.
When determining the normal value of SeAH’s U.S. sales of WLP, Commerce did not
use home market prices because it determined that SeAH had an insufficient volume
of sales into the Korean market to permit a proper comparison with U.S. sales of the
subject merchandise. See Welded Line Pipe from Korea, 83 Fed. Reg. 1,023 (Dep’t
Commerce Jan. 9, 2018) (prelim. results of [ADD] admin. review; 2015–2016)
(“Prelim. Results”) and accompanying Decisions Memo. for the [Prelim. Results] at
15, A-580-876, PD 259, bar code 3657712-01 (Jan. 2, 2018). Further, Commerce did
not use SeAH’s sales of WLP into the Canadian market because it determined that
SeAH’s sales into Canada were not representative—a determination predicated on
Consol. Court No. 18-00169 Page 5
the Canadian International Trade Tribunal’s (“CITT”) 1 finding that SeAH’s sales
were dumped. See Final Decision Memo at 45–47. Thus, Commerce used constructed
value to calculate the normal value of SeAH’s sales, as adjusted to account for the
alleged PMS in Korea. See id.In Husteel I, the court held that Commerce’s upward adjustment to Hyundai’s
reported costs for purchases of the HRC input—for purposes of subjecting Hyundai’s
home market sales of WLP to the below-cost sales test when calculating normal
value—is unlawful. See Husteel I, 44 CIT at __, __, 426 F. Supp. 3d at 1383–89, 1394.
Further, the court held that Commerce’s PMS determination was unsupported by
substantial evidence because Commerce relied on the “cumulative effect” of four
factors without substantiating its analysis regarding individual factors. See id., 44
CIT at __, 426 F. Supp. 3d at 1389–92. The court also held that Commerce failed to
address why it was reasonable to rely solely on the CITT’s findings that SeAH’s sales
were dumped to determine that SeAH’s WLP sales into Canada were
unrepresentative, despite being confronted with evidence of material differences
between Canadian and U.S. antidumping laws. See id. Accordingly, the court did
not reach Husteel’s challenge to Commerce’s calculation of the all-others rate, and
1 The CITT reviews determinations made by the Canada Border Services Agency
(“CBSA”). When referencing the dumping determination at issue, the parties referred
interchangeably to both the CITT and the CBSA. Commerce placed on the record the
CITT’s findings. Because both references pertain to the same dumping determination
at issue, this court will refer to the CITT’s findings.
Consol. Court No. 18-00169 Page 6
remanded Commerce’s determination for further explanation or consideration
consistent with the court’s opinion. See id., 44 CIT at __, 426 F. Supp. 3d at 1395.
On remand, Commerce, under respectful protest, 2 reversed its determination
that a PMS exists in Korea that distorts the COP of WLP, and calculated Hyundai
and SeAH’s dumping margin without upwardly adjusting the reported costs of HRC.
See Remand Results at 1–2. Commerce relied on SeAH’s third country sales to
determine normal value, see id., and corrected a ministerial error when calculating
SeAH’s margin. See id. at 9–10. As a result, Commerce calculates weighted-average
dumping margins of 4.70 percent for SeAH and 9.24 percent for Hyundai. See id. at
10. The all-others rate, which is no longer contested, is now 6.97 percent. Id.
However, Commerce seeks a remand to address its failure to properly consider
whether to apply a CEP offset to SeAH’s sales of WLP into Canada. See Def.’s Resp.
to Cmts. on [Remand Results] at 7–8, May 15, 2020, ECF No. 134 (“Def.’s Br.”).
Defendant-intervenors California Steel Industries (“CSI”) and Welspun
Tubular LLC USA (“Welspun”) dispute the court’s holdings in Husteel I and concur
with Commerce’s decision to submit its Remand Results under protest. See Def.-
Intervenors California Steel Industries & Welspun Tubular LLC USA’s Cmts. on
[Remand Results] at 1–5, May 1, 2020, ECF No. 130 (“CSI & Welspun’s Br.”).
Defendant-Intervenors Maverick Tube Corporation (“Maverick”) and IPSCO
2By adopting a position “under protest,” Commerce preserves its right to appeal. See
Viraj Grp., Ltd. v. United States, 343 F. 3d 1371, 1376 (Fed. Cir. 2003).
Consol. Court No. 18-00169 Page 7
Tubulars Inc. (“IPSCO Tubulars”) 3 request the court remand Commerce’s
determination with instructions to recalculate SeAH’s dumping margin using
constructed value. See Def.-Intervenors Maverick Tube Corporation & IPSCO
Tubulars Inc.’s Cmts. on [Remand Results] at 2–13, May 1, 2020, ECF No. 133
(“Maverick & IPSCO Tubulars’ Br.”). Maverick and IPSCO Tubulars alternatively
request that the court sustain Commerce’s ministerial correction. Maverick & IPSCO
Tubulars’ Br. at 12–13. CSI and Welspun endorse Maverick and IPSCO Tubulars
comments on Commerce’s Remand Results. See CSI & Welspun’s Br. at 1.
SeAH requests the court remand Commerce’s determination with instructions
to apply a CEP offset when calculating SeAH’s normal value. See [SeAH’s] Cmts. on
[Remand Results] at 1–5, May 1, 2020, ECF No. 131 (“SeAH’s Br.”). SeAH also
requests the court disregard Maverick and IPSCO Tubulars’ comments on the
Remand Results as untimely motions for the court to alter or amend its original
judgment. See [SeAH’s] Reply to Cmts. on [Remand Results] at 1–4, May 18, 2020,
ECF No. 135 (“SeAH’s Reply Br.”). Hyundai and NEXTEEL Co., Ltd. (“NEXTEEL”)
similarly contest CSI and Welspun’s failure to address Commerce’s compliance with
the court’s instructions and argue that defendant-intervenors’ objections to the
Remand Results, and this court’s holding, are otherwise unpersuasive. See Consol.
3On February 7, 2020, defendant-intervenor IPSCO Tubulars Inc., formerly referred
to as “TMK IPSCO”, filed on the docket a letter apprising the court of its acquisition
by Tenaris, S.A, corporate restructuring, and resultant change in name. See Letter
Regarding Acquisition & Party Name, Feb. 7, 2020, ECF No. 119.
Consol. Court No. 18-00169 Page 8
Pls. [Hyundai] & NEXTEEL’s Reply to Cmts. on [Remand Results] 2–7, May 18, 2020,
ECF No. 137 (“Consol. Pls.’ Br.”).
JURISDICTION AND STANDARD OF REVIEW
The court has jurisdiction pursuant to section 516a(a)(2)(B)(iii) of the Tariff
Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii), 4 and 28 U.S.C. § 1581(c)
(2012), which grant the court authority to review actions contesting the final
determination in an investigation of an [ADD] order. The court will uphold
Commerce’s determination unless it is “unsupported by substantial evidence on the
record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i). “The
results of a redetermination pursuant to court remand are also reviewed ‘for
compliance with the court’s remand order.’” Xinjiamei Furniture (Zhangzhou) Co. v.
United States, 38 CIT __, __, 968 F. Supp. 2d 1255, 1259 (2014) (quoting Nakornthai
Strip Mill Public Co. v. United States, 32 CIT 1272, 1274, 587 F. Supp. 2d 1303, 1306
(2008)).
4 Further citations to the Tariff Act of 1930, as amended, are to the relevant
provisions of Title 19 of the U.S. Code, 2012 edition. All further citations to 19 U.S.C.
§ 1677b(e) are to the 2015 version, as amended pursuant to the Trade Preferences
Extension Act of 2015, Pub. L. No. 114-27, 129 Stat. 362 (2015) (“TPEA”).
Consol. Court No. 18-00169 Page 9
DISCUSSION
I. Particular Market Situation
CSI and Welspun object to Commerce’s decision to reverse its PMS finding.
See CSI & Welspun’s Br. at 1–5. Defendant, Hyundai, and NEXTEEL counter that
Commerce’s remand redetermination complies with the court’s remand order, and
that defendant-intervenors fail to produce any evidence demonstrating otherwise.
See Def.’s Br. at 5–6; Consol. Pls.’ Br. at 2–7. For the reasons that follow, Commerce’s
reversal of its PMS determination is sustained.
When reviewing an ADD order, Commerce determines antidumping duties
owed on subject imports by calculating the amount by which the normal value of the
merchandise exceeds its export price (or constructed export price). See 19 U.S.C. §§
1673, 1675(a)(2)(A), (C); see also id. at § 1677(35). Commerce normally relies on sales
of the subject merchandise in the home market, or sales in a third country comparator
market, to determine normal value. See id. at § 1677b(a)(1)(B)(ii)(III), (C)(iii).
However, if Commerce determines that a PMS exists, the agency may determine
normal value using the constructed value methodology. See id.
To establish the existence of a PMS, Commerce must demonstrate both that
there are distortions present in the market and that those distortions prevent a
proper comparison of normal value with export price or constructed export price. See
id. at § 1677b(a)(1)(B)(ii)(III), (C)(iii) (stating that home market or third market
prices that Commerce determines are affected by a PMS which prevents a proper
Consol. Court No. 18-00169 Page 10
comparison with export price or constructed price cannot be used to calculate normal
value). Commerce’s determinations must be supported by substantial evidence. The
evidence must be sufficient that a reasonable mind might accept the evidence as
adequate to support its conclusion while considering contradictory evidence. See
Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938); see also Suramerica de
Aleaciones Laminadas, C.A. v. United States, 44 F.3d 978, 985 (Fed. Cir. 1994).
On remand, Commerce reverses its determination that a PMS exists in Korea
that distorts the COP of WLP. See Remand Results at 5, 7–8. Commerce does so
under respectful protest. Id. at 7–8. Although Commerce and the domestic parties
disagree with the court’s holding in Husteel I, 5 they do not provide any additional
5CSI and Welspun maintain that Commerce is authorized to make a PMS adjustment
to the reported costs of WLP for purposes of administering the below-cost sales test.
See CSI & Welspun’s Br. at 2 & n.2. Furthermore, CSI and Welspun argue that
Commerce’s PMS finding was “amply supported by substantial evidence.” See id. at
2–5. Regarding Commerce’s PMS finding, CSI and Welspun take particular issue
with the court’s suggestion that Commerce explain why Chinese steel overcapacity
prevents a proper comparison between home market prices and export prices, quoting
the following from Husteel I:
Chinese overcapacity may affect the COP by lowering the price of HRC,
however, it is unclear how that finding alone would support the
determination that the home market price and export price (or
constructed export price) cannot be compared because Commerce does
not address whether costs would be lowered on both sides of the less
than fair value equation
Id. at 4 (quoting Husteel I, 44 CIT at __, 426 F. Supp. 3d at 1391–92). CSI and
Welspun argue that the statute is “only concerned with whether normal values are
in the ordinary course of trade” and that “the concept of ordinary course of trade and
PMS do not apply to the calculation of export price.” Id. 4 (citing 19 U.S.C.
(footnote continued)
Consol. Court No. 18-00169 Page 11
evidence or analysis demonstrating why the cumulative effect of Chinese steel
overcapacity, Korean HRC subsidies, strategic alliances between HRC producers, and
government control over electricity price distort the market such that Commerce is
unable to render a proper comparison between normal value and export price (or
constructed export price) for WLP. See id. at 8; see also CSI & Welspun’s Br. at 1–5.
Commerce’s determination to reverse its PMS finding is reasonable and complies
with the court’s order in Husteel I.
II. SeAH’s Third Country Sales
Maverick and IPSCO Tubulars challenge Commerce’s determination to
calculate normal value for SeAH’s sales of WLP based on its sales into the Canadian
market. See Maverick & IPSCO Tubulars’ Br. at 3–12. 6 Defendant counters that
§§ 1677(15), 1677a, 1677b). In Husteel I, the court explained that Commerce failed
to substantiate its analysis regarding the individual factors it cites as support for its
determination that a PMS in Korea distorts the costs of producing WLP. See Husteel
I, 44 CIT at __, 426 F. Supp. 3d at 1389–92 & nn. 18–19. The court observed that,
even if the agency’s findings of various market distortions were supported, Commerce
failed to explain how the distortions prevent a proper comparison between normal
value and export prices (or constructed export prices). See id. For instance, the court
noted that it was not clear how Chinese steel overcapacity “specifically” or
“particularly” affected the Korean market. See e.g., Husteel I, 44 CIT at __, 426 F.
Supp. 3d at 1391 (noting Defendant’s concession that Chinese steel overcapacity is
not a phenomenon specific to the Korean market). Thus, Husteel I does not suggest
that the concepts of “PMS” and “ordinary course of trade” extend to calculation of the
export price (or constructed export price), but rather illustrates the evidentiary and
analytical shortcomings of Commerce’s PMS determination.
6SeAH requests that the court treat Maverick and IPSCO Tubulars’ comments as a
Rule 59(e) motion for the court to alter or amend its judgment in Husteel I and to
(footnote continued)
Consol. Court No. 18-00169 Page 12
Maverick and IPSCO Tubulars fail to demonstrate that Commerce’s determination is
inconsistent with the court’s remand order. See Def.’s Br. at 6–7; see also Husteel I,
44 CIT at __, 426 F. Supp. 3d at 1392–94. For the following reasons, Commerce’s
determination to calculate normal value for SeAH’s sales based on its sales into the
Canadian market is sustained.
Where Commerce finds that home market sales are an inappropriate basis for
determining normal value, it may resort to third country sales. See 19 U.S.C.
§ 1677b(a)(1). Commerce may only rely on third country sales where the “prices [for
those sales] are representative,” where the aggregate quantity of sales are at a
sufficient level, and where Commerce does not determine that a PMS prevents a
proper comparison between the export price (or constructed export price) and the
third country price. See 19 U.S.C. § 1677b(a)(1)(B)(ii). The statute does not define
what it means for prices to be representative, but Commerce’s regulations and
regulatory history reveal that where the aggregate quantity of third country sales are
at a sufficient level, those sales are presumptively representative unless proven
reject these submissions as untimely filed. See SeAH’s Reply Br. at 2–4; see also
USCIT R. 59(e). Without ruling on the timeliness and procedural propriety of
Maverick and IPSCO Tubulars’ comments on Commerce’s Remand Results, the court
declines to consider the parties’ challenges to the court’s holding in Husteel I. Under
USCIT R. 54(b), the court retains the general power to reconsider non-final orders.
See, e.g., Union Steel v. United States, 35 CIT 1647, 1659, 804 F. Supp. 2d 1356, 1367
(2011). The court revisits non-final determinations as justice requires, meaning when
necessary under the relevant circumstances. See Irwin Indus. Tool Co. v. United
States, 41 CIT __, __, 269 F. Supp. 3d 1294, 1300–01 (2017). Maverick and IPSCO
Tubulars, however, fail to provide any reason or controlling precedent that would
warrant reconsideration of the court’s holding in Husteel I.
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otherwise. See 19 C.F.R. § 351.404(b)–(c) (2017) 7 (providing that Commerce shall
consider a third country market viable if the aggregate quantity of sales are at a
sufficient level, but setting forth an exception where it is established, to the
satisfaction of the agency, that, inter alia, the prices are not representative);
Antidumping Duties; Countervailing Duties, 62 Fed. Reg. 27,296, 27,357 (Dep’t
Commerce May 19, 1997); 8 see also Alloy Piping Prods v. United States, 26 CIT 330,
339–340, 201 F. Supp. 2d 1267, 1276–77 & n.7 (2002) (citations omitted); see also,
e.g., Husteel Co. v. United States, 32 CIT 610, 616–620, 558 F. Supp. 2d 1357, 1363–
66 (2008) (instructing Commerce to find respondents’ sales representative if the
agency cannot present persuasive evidence demonstrating otherwise). The agency’s
determination that sales into a third country comparator market are not
7Further citations to Title 19 of the Code of Federal Regulations are to the 2017
edition.
8 The regulatory history to 19 C.F.R. § 351.404 provides, in pertinent part, that:
In the Department's view, the criteria of a “particular market situation”
and the “representativeness” of prices fall into the category of issues that
the Department need not, and should not, routinely consider . . . the
[Statement of Administrative Action] at 821 recognizes that the
Department must inform exporters at an early stage of a proceeding as
to which sales they must report. This objective would be frustrated if
the Department routinely analyzed the existence of a “particular market
situation” or the “representativeness” of third country sales . . . the party
alleging . . . that sales are not “representative” has the burden of
demonstrating that there is a reasonable basis for believing that a
“particular market situation” exists or that sales are not
“representative.”
Antidumping Duties; Countervailing Duties, 62 Fed. Reg. at 27,357; see also
Statement of Administrative Action, H.R. DOC. NO. 103-826, vol. 1, at 821 (1994),
reprinted in 1994 U.S.C.C.A.N. 4040, 4162 (“SAA”).
Consol. Court No. 18-00169 Page 14
representative must be supported by substantial evidence. See e.g., Motor Vehicle
Mfrs. Ass’n of U.S. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 48–49 (1983). “The
substantiality of evidence must take into account whatever in the record fairly
detracts from its weight.” CS Wind Vietnam Co. v. United States, 832 F.3d 1367, 1373
(Fed. Cir. 2016) (“CS Wind Vietnam Co.”) (quoting Gerald Metals, Inc. v. United
States, 132 F.3d 716, 720 (Fed. Cir. 1997)).
Commerce now finds, under protest, that SeAH’s sales into Canada are
representative. See Remand Results at 4, 7. Apart from the CITT’s findings that
SeAH’s sales into Canada are dumped, neither Commerce, nor the interested parties,
point to any record evidence or explanation as to why Commerce’s previous
determination that SeAH’s third country sales are not representative was reasonable
in light of inconsistencies between U.S. and Canadian antidumping law. See id.Commerce complains that it lacks sufficient evidence to “perform the compulsory
analysis” necessary to determine “whether SeAH’s comparison market sales to
Canada would be found to have been dumped under U.S. law.” Remand Results at 4.
Commerce does not explain why it would not suffice for the agency to explain why the
inconsistencies between U.S. and Canadian antidumping law should not disturb its
Consol. Court No. 18-00169 Page 15
previous finding that SeAH’s sales were not representative. 9 As such, Commerce’s
determination that SeAH’s sales are representative is reasonable. 10
III. CEP Offset
SeAH argues that Commerce contravenes agency regulation by declining to
apply a CEP offset when calculating its normal value because the level of SeAH’s U.S.
sales is less advanced than the actual level of SeAH’s third country sales into Canada.
See SeAH’s Br. at 1–5; see also 19 C.F.R. § 352.412. Maverick and IPSCO Tubulars
9 Maverick and IPSCO Tubulars submit that Commerce did account for
inconsistencies between U.S. and Canadian antidumping law in its Final Results.
See Maverick & IPSCO Tubulars’ Br. at 9. As their only support, Maverick and
IPSCO Tubulars quote the same statement from Commerce that the court rejected in
Husteel I: “[t]he fact that Commerce’s methodology may differ from that of the CBSA
does not negate Canada’s finding of dumping.” Maverick & IPSCO Tubulars’ Br. at
9 (quoting Final Decision Memo at 46); but see Husteel I, 44 CIT at __, 426 F. Supp.
3d at 1393 (“This response does not engage the apparent flaw in the evidence upon
which Commerce is relying to find that SeAH's sales into the Canadian market were
not representative.”). Again, Commerce’s conclusory response did not address
detracting evidence because it did not explain why the differences between
antidumping laws did not disturb its determination that SeAH’s sales were
unrepresentative. See CS Wind Vietnam Co., 832 F.3d at 1373. Commerce’s reversal
of its finding that SeAH’s sales into Canada are not representative is reasonable.
10 Commerce, Maverick, and IPSCO Tubulars disagree with the court’s holding in
Husteel I, arguing that it requires Commerce to disregard a formal finding of
dumping. See Remand Results at 4, 7; see also Maverick & IPSCO Tubulars’ Br. at
6–7. This argument misconstrues the holding in Husteel I. In Husteel I, Commerce
determined that SeAH’s sales of WLP into Canada were unrepresentative because of
the CITT’s formal finding that those sales were dumped. See Husteel I, 44 CIT at __,
426 F. Supp. 3d at 1392–94. The court held that it was unreasonable for Commerce
to rely solely on the CITT’s findings when confronted with record evidence that those
findings are materially inconsistent with U.S. antidumping law. See id. The court
remanded the issue to Commerce to reconcile its analysis with record evidence of
material inconsistences between U.S. and Canadian antidumping law alleged by
SeAH. See Remand Results at 4; but see Husteel I, 44 CIT at __, 426 F. Supp. 3d at
1392–94, 95.
Consol. Court No. 18-00169 Page 16
argue that Commerce’s determination not to grant a CEP offset is supported by
substantial evidence. See Maverick & IPSCO Tubulars’ Reply to Cmts. on [Remand
Results] at 4–8, May 18, 2020, ECF No. 136 (“Maverick & IPSCO Tubulars’ Reply
Br.”). Defendant conveys Commerce’s concession that the agency failed to properly
consider whether a CEP offset is warranted and requests a remand on this issue. See
Def.’s Br. at 7–9. For the following reasons, Commerce’s determination is remanded
for further explanation or reconsideration.
On remand, Commerce declines to grant a CEP offset to SeAH after finding
that SeAH’s sales into Canada were made at the same level of trade as its sales into
the United States, see Remand Results at 9, but SeAH submits that Commerce fails
to properly consider the selling activities of SeAH’s U.S. affiliate Pusan Pipe
Americas, Inc. (“PPA”). See SeAH’s Br. at 1–5. Defendant states that “Commerce
agrees with SeAH that the agency should have considered PPA’s selling functions in
determining the third country level of trade.” Def.’s Br. at 7–9.
The court has discretion to grant a request from Commerce for remand where
the agency expresses doubts about the correctness of its decision. See SKF USA, Inc.
v. United States, 254 F.3d 1022, 1029 (Fed. Cir. 2001) (citations omitted). The court
will usually grant such requests where Commerce’s concern is substantial and
legitimate, see id., but may refuse remand where the request appears to be frivolous
or in bad faith. See, e,g., Corus Staal BV v. United States, 29 CIT 777, 781–83, 387
F.Supp.2d 1291, 1296–97 (2005) (“The Government must give due regard to finality
Consol. Court No. 18-00169 Page 17
and cannot simply ask for a do-over any time it wishes.”); Corus Staal BV v. U.S.
Dep’t of Commerce, 27 CIT 388, 391–95, 259 F. Supp. 2d 1253, 1257–60 (2003) (noting
that unsupported and vague requests are insufficient to meet the bar for a remand).
Commerce’s request for a remand to consider whether to apply a CEP offset to
SeAH’s Canadian sales raises substantial and legitimate concerns, and remand on
this issue is appropriate, because the agency acknowledges it failed to revisit its
preliminary determination that SeAH’s sales into Canada were made at the same
level as its U.S. sales. Def.’s Br. at 7–8 (citations omitted). Commerce makes a
specific request to address a clearly identified lapse in its analysis on remand, and
does not appear to do so frivolously or in bad faith. See id. Accordingly, Commerce’s
request for remand to address the question of whether to apply the CEP offset to
SeAH’s Canadian sales is granted, and SeAH’s request for the court to instruct
Commerce to grant the CEP offset is denied. 11
CONCLUSION
For the forgoing reasons, it is
11 Maverick and IPSCO Tubulars request the court sustain Commerce’s correction to
its ministerial error of converting sales and expense data to U.S. dollars that were
already reported as U.S. dollars when calculating SeAH’s dumping margin. See
Maverick & IPSCO Tubulars’ Br. at 12–13; see also Remand Results at 9–10. Because
the court is remanding Commerce’s determination not to apply a CEP offset when
calculating SeAH’s dumping margin for further explanation or reconsideration,
which may result in different calculations and a different rate, the court does not
reach the issue.
Consol. Court No. 18-00169 Page 18
ORDERED that Commerce’s reversal of its particular market situation
determination is sustained; and it is further
ORDERED that Commerce’s determination to calculate SeAH’s normal value
using third country sales into Canada is sustained; and it is further
ORDERED that Commerce’s determination not to apply a CEP offset to
SeAH’s Canadian sales is remanded for further consideration and/or explanation
consistent with this opinion; and it is further
ORDERED that Commerce shall file its remand redetermination with the
court within 60 days of this date; and it is further
ORDERED that the parties shall have 30 days thereafter to file comments on
the remand redetermination; and it is further
ORDERED that the parties shall have 15 days to file their replies to
comments on the remand redetermination; and it is further
ORDERED that the parties shall have 14 days thereafter to file the Joint
Appendix; and it is further
ORDERED that Commerce shall file the administrative record within 14 days
of the date of filing of its remand redetermination.
/s/ Claire R. Kelly
Claire R. Kelly, Judge
Dated: July 23, 2020
New York, New York