Sigma Corp. v. United States

Slip Op. 00-16

UNITED STATES COURT OF INTERNATIONAL TRADE

BEFORE: SENIOR JUDGE NICHOLAS TSOUCALAS
________________________________________
:
SIGMA CORPORATION, U.V. INTERNATIONAL, :
SOUTHERN STAR, INC., CITY PIPE and :
FOUNDRY, INC. and LONG BEACH IRON :
WORKS, INC.; :
:
OVERSEAS TRADE CORPORATION; :
:
D&L SUPPLY CO.; :
:
DEETER FOUNDRY, INC., ALHAMBRA FOUNDRY, :
INC., ALLEGHENY FOUNDRY CO., BINGHAM :
& TAYLOR DIVISION, VIRGINIA INDUSTRIES, :
INC., CAMPBELL FOUNDRY CO., CHARLOTTE :
PIPE & FOUNDRY CO., EAST JORDAN IRON :
WORKS, INC., LEBARON FOUNDRY INC., : Consol. Court No.
MUNICIPAL CASTINGS, INC., NEENAH : 91-02-00154
FOUNDRY CO., OPELIKA FOUNDRY CO., INC., :
PINKERTON FOUNDRY INC., TYLER PIPE :
INDUSTRIES, INC., U.S. FOUNDRY & :
MANUFACTURING CO. and VULCAN :
FOUNDRY, INC., :
:
Plaintiffs, :
:
v. :
:
UNITED STATES, :
:
Defendant, :
:
D&L SUPPLY CO.; :
:
DEETER FOUNDRY, INC., et al., :
:
Defendant-Intervenors. :
________________________________________:
________________________________________
:
SIGMA CORPORATION, SOUTHERN STAR, INC., :
CITY PIPE and FOUNDRY, INC. and :
LONG BEACH IRON WORKS, INC.; :
:
OVERSEAS TRADE CORPORATION; :
:
GUANGDONG METALS & MINERALS IMPORT & :
EXPORT CORPORATION; :
:
U.S. FOUNDRY & MANUFACTURING CO., :
ALHAMBRA FOUNDRY, INC., ALLEGHENY :
FOUNDRY CO., BINGHAM & TAYLOR DIVISION, :
VIRGINIA INDUSTRIES, INC., CHARLOTTE :
PIPE & FOUNDRY CO., DEETER FOUNDRY :
INC., EAST JORDAN IRON WORKS, INC., :
LEBARON FOUNDRY INC., MUNICIPAL :
CASTINGS, INC., NEENAH FOUNDRY CO., :
OPELIKA FOUNDRY CO., INC., TYLER PIPE :
INDUSTRIES, INC. and VULCAN : Consol. Court No.
FOUNDRY, INC., : 92-04-00283
:
Plaintiffs, :
:
U.V. INTERNATIONAL, :
:
Plaintiff-Intervenor, :
:
v. :
:
UNITED STATES, :
:
Defendant, :
:
GUANGDONG METALS & MINERALS IMPORT :
& EXPORT CORPORATION; :
:
U.S. FOUNDRY & MANUFACTURING CO., :
et al., :
:
Defendant-Intervenors. :
________________________________________:
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 3

Plaintiffs/defendant-intervenors D&L Supply Co. (“D&L”) and
Guangdong Metals & Minerals Import & Export Corporation
(“Guangdong”) contest the Department of Commerce, International
Trade Administration’s (“Commerce”) results in Amended Final
Results of Redetermination Pursuant to Court Remand, Sigma Corp. v.
United States, Consol. Court Nos. 91-02-00154, 92-04-00283 (“Remand
Results”) (Jan. 30, 1998). Specifically, D&L claims that Commerce
erred in: (1) including freight costs in import values in addition
to those for ocean and foreign inland freight; (2) employing a
method to calculate the antidumping percentage that overstated the
margin percentage; and (3) overstating the packing expenses.
Guangdong claims that Commerce erred in: (1) including freight
costs in import values in addition to those for ocean and foreign
inland freight; (2) overstating the factory overhead percentage;
(3) employing a method to calculate the antidumping percentage that
overstated the margin percentage; and (4) overstating the packing
expenses. D&L and Guangdong request another remand to correct the
errors.

Plaintiffs/defendant-intervenors Deeter Foundry, Inc.,
Alhambra Foundry, Inc., Allegheny Foundry Co., Bingham & Taylor
Division, Virginia Industries, Inc., Campbell Foundry Co.,
Charlotte Pipe & Foundry Co., East Jordan Iron Works, Inc., LeBaron
Foundry Inc., Municipal Castings, Inc., Neenah Foundry Co.,
Opelika Foundry Co., Inc., Pinkerton Foundry, Inc., Tyler Pipe
Industries, Inc., U.S. Foundry & Manufacturing Co. and Vulcan
Foundry, Inc. (collectively “domestic industry”) also contest
Commerce’s Remand Results and request another remand. The domestic
industry claims that Commerce understated the factory overhead
percentage.

Held: D&L’s request for a remand is denied. Guangdong’s
request for a remand is denied. The domestic industry’s request
for a remand is denied.

[Remand Results are affirmed in all respects.]

Dated: February 10, 2000

Ross & Hardies (Jeffrey S. Neeley) for plaintiff Overseas
Trade Corporation.

White & Case (Walter J. Spak, Vincent Bowen and Edmund W. Sim)
for plaintiffs Sigma Corporation, Southern Star, Inc., City Pipe
and Foundry, Inc., Long Beach Iron Works, Inc. and for
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 4

plaintiff/plaintiff-intervenor U.V. International.

Collier, Shannon, Rill & Scott, PLLC (Paul C. Rosenthal, Mary
T. Staley and Robin H. Gilbert) for plaintiffs/defendant-
intervenors Deeter Foundry, Inc., Alhambra Foundry, Inc., Allegheny
Foundry Co., Bingham & Taylor Division, Virginia Industries, Inc.,
Campbell Foundry Co., Charlotte Pipe & Foundry Co., East Jordan
Iron Works, Inc., LeBaron Foundry Inc., Municipal Castings, Inc.,
Neenah Foundry Co., Opelika Foundry Co., Inc., Pinkerton Foundry
Inc., Tyler Pipe Industries, Inc., U.S. Foundry & Manufacturing Co.
and Vulcan Foundry, Inc.

David W. Ogden, Acting Assistant Attorney General; David M.
Cohen, Director, Commercial Litigation Branch, Civil Division,
United States Department of Justice (Velta A. Melnbrencis,
Assistant Director, and Reginald T. Blades, Jr.); of counsel: Linda
S. Chang, Office of the Chief Counsel for Import Administration,
United States Department of Commerce, for defendant.

Cameron & Hornbostel LLP (Dennis James, Jr.) for
plaintiffs/defendant-intervenors D&L Supply Co. and Guangdong
Metals & Minerals Import & Export Corporation.

OPINION

TSOUCALAS, Senior Judge: Plaintiffs/defendant-intervenors D&L

Supply Co. (“D&L”) and Guangdong Metals & Minerals Import & Export

Corporation (“Guangdong”) contest the Department of Commerce,

International Trade Administration’s (“Commerce”) results in

Amended Final Results of Redetermination Pursuant to Court Remand,

Sigma Corp. v. United States, Consol. Court Nos. 91-02-00154, 92-

04-00283, (“Remand Results”) (Jan. 30, 1998). Specifically, D&L

claims that Commerce erred in: (1) including freight costs in

import values in addition to those for ocean and foreign inland

freight; (2) employing a method to calculate the antidumping
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 5

percentage that overstated the margin percentage; and (3)

overstating the packing expenses. Guangdong claims that Commerce

erred in: (1) including freight costs in import values in addition

to those for ocean and foreign inland freight; (2) overstating the

factory overhead percentage; (3) employing a method to calculate

the antidumping percentage that overstated the margin percentage;

and (4) overstating the packing expenses. D&L and Guangdong

request another remand to correct the errors.

Plaintiffs/defendant-intervenors Deeter Foundry, Inc.,

Alhambra Foundry, Inc., Allegheny Foundry Co., Bingham & Taylor

Division, Virginia Industries, Inc., Campbell Foundry Co.,

Charlotte Pipe & Foundry Co., East Jordan Iron Works, Inc., LeBaron

Foundry Inc., Municipal Castings, Inc., Neenah Foundry Co.,

Opelika Foundry Co., Inc., Pinkerton Foundry, Inc., Tyler Pipe

Industries, Inc., U.S. Foundry & Manufacturing Co. and Vulcan

Foundry, Inc. (collectively “domestic industry”) also contest

Commerce’s Remand Results and request another remand. The domestic

industry claims that Commerce understated the factory overhead

percentage.
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 6

BACKGROUND

On September 8, 1997, the Court issued orders remanding

consolidated court numbers 91-02-00154 and 92-04-00283 to

Commerce.1 See Sigma Corp. v. United States (“Sigma I”), Slip Op.

No. 97-125, 1997 WL 739595 (CIT Sept. 8, 1997); Sigma Corp. v.

United States (“Sigma II”), Slip Op. No. 97-126, 1997 WL 739611

(CIT Sept. 8, 1997). The remand was ordered pursuant to the

decision (July 7, 1997) and mandate (Aug. 29, 1997) of the Court of

Appeals for the Federal Circuit (“CAFC”), directing Commerce to:

(1) recalculate the value of the freight component of foreign

market value (“FMV”) for the 1987-89 and 1989-90 reviews; (2)

adequately support its determination of surrogate factory overhead

for the 1989-90 review; and (3) replace the invalidated dumping

margin as the value for the best information available for the

1
Consolidated court number 91-02-00154 involves Commerce’s
final results for the 1987-89 administrative review of the
Antidumping Duty Order; Iron Construction Castings From the
People’s Republic of China (the PRC), 51 Fed. Reg. 17,222 (May 9,
1986). See Iron Construction Castings From the People’s Republic
of China; Final Results of Antidumping Duty Administrative Review,
56 Fed. Reg. 2,742 (Jan. 24, 1991). Consolidated court number 92-
04-00283 involves Commerce’s final results for the 1989-90
administrative review. See Final Results of Antidumping Duty
Administrative Review: Certain Iron Construction Castings From the
People’s Republic of China, 57 Fed. Reg. 10,644 (Mar. 27, 1992).
Since both cases involve almost identical facts and because the
Court of Appeals for the Federal Circuit considered the cases
together, this Court will consider and refer to them as a single
matter. The Court, however, will not address every aspect of this
case’s long procedural history. Only those details relevant to the
matters at issue will be discussed.
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 7

1989-90 review.

On December 12, 1997, Commerce released draft remand results

in this action and invited interested parties to comment. After

receiving comments from certain United States importers and from

the domestic industry, Commerce filed its Final Results of

Redetermination Pursuant to Court Remand, Sigma Corp. v. United

States, Consol. Court Nos. 91-02-00154, 92-04-00283 (Jan. 21,

1998). Commerce subsequently released the Amended Final Results of

Redetermination Pursuant to Court Remand, Sigma Corp. v. United

States, Consol. Court Nos. 91-02-00154, 92-04-00283 (“Remand

Results”) (Jan. 30, 1998) upon discovering and correcting a

clerical error.

D&L, Guangdong and the domestic industry contest the Remand

Results and request another remand. The issue before the Court is

whether the Remand Results complied with the remand instructions

contained in the orders issued by the Court pursuant to the

decision and mandate of the CAFC.2

2
Since the administrative reviews at issue were initiated
before January 1, 1995, the applicable law is the antidumping
statute as it existed prior to the amendments made by the Uruguay
Round Agreements Act, Pub. L. No. 103-465, 108 Stat. 4809 (1994).
See Torrington Co. v. United States, 68 F.3d 1347, 1352 (Fed. Cir.
1995).
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 8

JURISDICTION

The Court retains jurisdiction over this matter pursuant to 19

U.S.C. § 1516a(a)(2) (1994) and 28 U.S.C. § 1581(c) (1994).

STANDARD OF REVIEW

The Court will uphold Commerce’s final results of

redetermination pursuant to the Court’s remand 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) (1994).

DISCUSSION

I. Freight Costs

The CAFC determined that the method used by Commerce to

calculate the freight component of FMV resulted in overstatement of

that value. See Sigma Corp. v. United States (“Sigma III”), 117

F.3d 1401, 1407 (Fed. Cir. 1997). The CAFC described Commerce’s

method as follows:

[Commerce] started with the import price of pig iron in
the [surrogate country], i.e., the price of pig iron
delivered to port in the [surrogate country], with
foreign inland and ocean freight expenses already
included. Commerce then ascertained the distance from
the pig iron mill in China to the foundry and added a
constructed freight cost for that distance to the
[surrogate country] import price.

Id. The CAFC criticized Commerce’s assumption that the price of

domestically produced pig iron was equal to the import price and
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 9

“that [,therefore,] a Chinese iron castings manufacturer would

purchase domestic pig iron at the import price, rather than

imported pig iron at the import price, regardless of the respective

freight costs for inland transportation of the domestic and

imported pig iron.” Id. at 1408. The CAFC reasoned that instead,

a manufacturer would minimize its costs “by purchasing imported pig

iron if the cost of transportation from the port to the foundry

were less than the cost of transportation from the domestic pig

iron mill to the foundry.” Id. Accordingly, this Court ordered

Commerce to recalculate constructed FMV using a method that does

not double-count ocean freight and foreign inland freight. See

Sigma I, at *1; Sigma II, at *1.

On remand, Commerce altered its method of valuation. Commerce

described its method in the Remand Results as follows:

[A]ll [pig iron] inputs were revalued to include the
surrogate CIF price plus a value for freight based on the
shorter of the reported distances from either the closest
PRC seaport to the castings foundry or from the PRC
domestic materials supplier to the foundry.3

Remand Results at 3.

3
The CIF (cost, insurance and freight) import price
includes ocean and foreign inland freight. See Amended Final
Results of Redetermination Pursuant to Court Remand, Sigma Corp. v.
United States, Consol. Court Nos. 91-02-00154, 92-04-00283, p. 10
(Jan. 30, 1998).
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 10

The Court finds that Commerce’s decision to add a freight

value based on the reported distances in China to the surrogate CIF

price was supported by substantial evidence.4 As the government

states, adding to CIF price “an amount for inland freight in China

from the nearest of the place of importation or the actual supplier

represents a market value for providing the input to the

manufacturer at the location of that manufacturer’s plant.” Def.’s

Reply Comments Upon the Remand Results (“Def.’s Comments”) at 4.

Contrary to the contentions of D&L and Guangdong, the CIF

surrogate price alone does not properly account for the entire cost

of freight. See Def.-Intervenor D&L Supply Co.’s Comments on the

Remand Results (“D&L’s Comments”) at 2; Def.-Intervenor Guangdong

Metals & Minerals Import & Export Corp.’s Comments on the Remand

Results (“Guangdong’s Comments”) at 3. The CIF import price

“includes the inland freight required to transport materials from

the point of production to the point of export, and, the ocean

freight required to transport the goods from the country of origin”

to the surrogate country. Iron Construction Castings From the

People’s Republic of China; Final Results of Antidumping Duty

Administrative Review, 56 Fed. Reg. 2,742, 2,746 (Jan. 24, 1991).

4
Using both surrogate and actual values to determine
foreign market value in a nonmarket economy country is permitted
under 19 U.S.C. § 1677b (1988). See Lasko Metal Products, Inc. v.
United States, 43 F.3d 1442 (Fed. Cir. 1994).
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 11

Thus, this price represents the cost to get the raw materials to

the Chinese port, but it does not include the freight cost incurred

by a producer to get the materials from the Chinese port to the

castings foundry. The inland freight cost is necessary to account

for that additional transportation cost.

Furthermore, the CAFC did not instruct that any freight in

addition to ocean and foreign inland freight be eliminated

altogether; rather, it objected to the particular method chosen by

Commerce to calculate the freight component of FMV. Specifically,

the CAFC stated:

Simply put, the import prices in the [surrogate country]
already included ocean freight and foreign inland
freight, a substantial portion of the total cost of
transporting imported pig iron from the pig iron mill to
the foundry. By adding a constructive freight charge for
the entire trip from the mill to the foundry in China on
top of the import prices in the [surrogate country],
Commerce’s methodology double-counted a substantial
component of the total freight expense.

Sigma III, 117 F.3d at 1407-08 (emphasis supplied). Thus, the CAFC

rejected Commerce’s approach of adding a freight cost for the

entire trip from the mill to the foundry in China on top of the CIF

import price. Commerce’s method in the Remand Results eliminates

this concern since it adds only that portion for freight not

already accounted for in the CIF price–-the cost of transporting

pig iron from the port to the castings foundry. Because

Commerce’s method of calculating freight is supported by
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 12

substantial evidence, Commerce is affirmed.

II. Factory Overhead Percentage

In 1991, Commerce obtained a cable from the United States

embassy in Pakistan containing information on overhead rates at

castings foundries in that country. See Final Results of

Antidumping Duty Administrative Review: Certain Iron Construction

Castings From the People’s Republic of China, 57 Fed. Reg. 10,644,

10,645 (Mar. 27, 1992). The cable data pertained to the cost

breakdown for “a large Lahore-based foundry,” which Commerce had

used to calculate the surrogate overhead value for Guangdong’s

foundries. Remand Results at 4-5. There was, however, no definite

way to ascertain whether the Lahore-based foundry was comparable in

size to the Guangdong foundries and, therefore, whether the use of

the Lahore-based foundry data to calculate the Guangdong surrogate

values was appropriate. Consequently, the CAFC determined that

Commerce’s use of the single cable to calculate the surrogate value

for the factory overhead component of FMV was not supported by

substantial evidence. See Sigma III, 117 F.3d at 1410. This Court

remanded the matter and ordered Commerce to obtain more information

from its representatives in Pakistan with regard to the
size of the “large Lahore-based foundry,” and whether the
overhead for that foundry is comparable to the overhead
that would be experienced by a foundry the size of
Guangdong’s foundries and, if necessary based on this
information, recalculate the surrogate foundry overhead
component of constructed foreign market value.
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 13

Sigma II, at *1.

On remand, Commerce adjusted the values obtained in the 1991

cable to account for foundry size. See Remand Results at 5.

Commerce made the adjustments by relying on two facsimiles received

from the United States embassy in Pakistan in 1997 during the

course of its investigation. See id. at 5-6. In the first

facsimile, dated November 19, 1997, the embassy conveyed that it

had contacted “‘possibly the largest Lahore-based foundry,’” but

did not know whether this was the foundry referenced in the 1991

cable. Id. at 5. The embassy learned that the foundry has a

production capability of 25,000 metric tons per month and overhead

rates ranging from 15 to 20 percent. See id. The foundry

estimated that small foundries, defined as ones capable of

producing two to ten metric tons per month, would have overhead

rates from 5 to 10 percent. See Remand Results at 5.

The second facsimile, dated December 9, 1997, contained a

letter from the Pakistan Steel Melters’ Association that provided

information about the sizes of foundries in Pakistan. See id. at

6. The letter clarified the 1991 cable by conveying that: (1)

large foundries are capable of producing more than 500 metric tons

per month; (2) medium foundries are capable of producing 100 to 500

metric tons per month; and (3) small foundries, or mini-foundries,

produce up to 100 metric tons per month. See id.
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 14

Commerce classified Guangdong’s foundries by size, according

to the information contained in the Steel Melters’ Association

letter. See id. at 6-7. Thus, depending on their production

capabilities, three of the foundries were classified as medium and

one as small. See Remand Results at 7. Based on the size of the

foundries, Commerce calculated overhead rates as follows:

Because the 1991 cable tells us that overhead rates
for small foundries are 20-30 percent and that overhead
rates for large foundries are 40-50 percent, we can
reasonably infer that the medium-size factories would
have an overhead range of between 30 and 40 percent. We
based this inference on the fact that both the 1991 cable
and the information submitted by the U.S. Embassy on
November 19, 1997 reflect approximately the same
proportion between the overhead rates for small foundries
and those for large foundries. The 23.75 percent
overhead rate used in the underlying review is based on
the most specific information available to the
Department. However, in light of the information
discussed above, for these final results of
redetermination, we have concluded that the 23.75 percent
overhead rate calculated for the 1989-90 review period
was taken from a large foundry and have assumed that this
foundry represents the median of the large firms that the
1991 cable referenced as having overheads of 40-50
percent. In order to extrapolate what the overhead rate
would be for a medium and a small foundry based on
similarly specific information, we adjusted the 23.75
percent figure to reflect the size of Guangdong’s
foundries. For Guangdong’s small foundry, we calculated
overhead as (23.75%/45) X 25, i.e. 13.19 percent. For
each of Guangdong’s medium size foundries, we calculated
overhead as (23.75%/45) X 35, i.e. 18.47 percent.

Id. at 7-8.

The domestic industry disputes Commerce’s inference that

overhead costs incurred by medium foundries are higher than those
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 15

incurred by small foundries and lower than those incurred by large

foundries, arguing that medium foundries could incur higher costs

than small foundries because they are family-run and higher costs

than large foundries because they can take advantage of economies

of scale. See Domestic Industry’s Comments on the Commerce

Department’s Final Results of Redetermination Pursuant to Court

Remand (“Domestic Industry’s Comments”) at 2. The domestic

industry, however, offers no evidence in support of these

contentions. The domestic industry continues to maintain that the

overhead costs of the large Lahore foundry of 23.75 percent

constitute the best information available. See id.

Guangdong, on the other hand, maintains that the overhead rate

is still not low enough. See Guangdong’s Comments at 5. Guangdong

protests that any comparison of its foundries to the Lahore-based

foundry is completely inappropriate given the difference in size

between them. Guangdong’s Comments at 11. Guangdong believes that

“[w]hile the adjustments undertaken by Commerce ameliorated to some

degree the disparities, the adjustments did not create

comparability.” Id. at 11. Guangdong complains that Commerce

ignored superior data on Indian overhead costs that Guangdong had

submitted. See id. at 7. Guangdong believes that Commerce also

could have used the overhead data in the Pakistan Steel Melters’

Association letter, from which Commerce had extracted the foundry
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 16

size data. See id. at 9-10. Commerce explained its rationale for

not using the new data by stating:

We used values from the 1991 cable, rather than
values obtained in the course of the remand, because the
1991 cable contained information contemporaneous with the
period of review, and because the components of factory
overhead for the “large Lahore based foundry” referenced
in the 1991 cable are detailed, whereas none of the more
recent information gathered from Pakistan for the remand
provides such a breakdown for any size foundry.

Remand Results at 5.

The Court finds that Commerce’s determination was supported by

substantial evidence. The basic premise of Commerce’s analysis

comes from the 1991 cable, which indicates that foundry size

affects overhead and that larger foundries incur greater overhead

costs than smaller foundries. See Remand Results at 7. Commerce

obtained new information during the course of its investigation and

utilized that information to adjust the overhead values of the

Guangdong foundries. See id. Specifically, Commerce reduced the

overhead figure derived in 1991 to account for the assumption that

the 1991 figure was derived from a large foundry, while the

Guangdong factories were smaller. See id. at 7-8. Such action was

permissible according to both the mandate of the CAFC and the

remand order by this Court. See Sigma III, 117 F.3d at 1410; Sigma

II, at *1.
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 17

Although the Lahore and the Guangdong foundries are

incongruous with respect to size, they are alike in other

significant respects. For example, the 1991 data is

contemporaneous with the period of review, and it is also specific

to the iron castings industry. The components of the Lahore

foundry overhead calculation, that is, depreciation of machinery,

production overhead, refractories and molding costs, were known and

could be compared to Guangdong’s overhead components. These

similarities between the Lahore and Guangdong foundries are

necessary, since keeping as many factors constant between the

Guangdong and Lahore foundries ensures that a fair comparison can

be made even when the data is adjusted for size. As the government

states, “[t]hese ‘details’, which make the overhead calculation

specific to the type of casting operation that would produce iron

construction castings . . . provide Commerce with assurance that

the overhead value includes items closely associated with the

castings process used by Guangdong’s suppliers.” Defendant’s

Comments at 8-9. Thus, once the Lahore data is adjusted for size,

it is reasonable to assume that it is applicable to the Guangdong

foundries.

Guangdong vehemently protests the use of the Pakistani data,

believing that Commerce should have used the Indian data obtained

during the course of the 1997 investigation instead. See
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 18

Guangdong’s Comments at 16. The proper inquiry upon review of

Commerce’s determination, however, is whether the particular

actions Commerce took were supported by substantial evidence, not

whether Commerce could have used an alternative method or different

information. Thus, “the question is whether the record adequately

supports the decision of the ITA, not whether some other inference

could reasonably have been drawn.” Daewoo Elecs. Co. v. United

States, 6 F.3d 1511, 1520 (Fed. Cir. 1993); see also Torrington Co.

v. United States, 21 CIT ___,___, 965 F. Supp. 40, 42 (1997) (“It

is not within the Court’s domain either to weigh the adequate

quality or quantity of the evidence for sufficiency or to reject a

finding on grounds of a differing interpretation of the record.”)

(citation omitted). “Nor does it mean that even as to matters not

requiring expertise a court may displace [Commerce’s] choice

between two fairly conflicting views, even though the court would

justifiably have made a different choice had the matter been before

it de novo.” Universal Camera Corp. v. NLRB, 340 U.S. 474, 488

(1951). Because Commerce’s determination was supported by

substantial evidence, Commerce is affirmed.

III. Antidumping Percentage

D&L and Guangdong maintain that Commerce incorrectly

calculated the antidumping percentage, resulting in an

overstatement of the margin. See D&L’s Comments at 5; Guangdong’s
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 19

Comments at 16. Specifically, they claim that the entered value

formula was incorrect because the denominator used in calculating

the dumping percentage erroneously contained the value for foreign

inland freight. See D&L’s Comments at 5-6; Guangdong’s Comments at

17-18.

D&L and Guangdong had multiple opportunities to raise this

argument before Commerce and before this Court and failed to do so.

The government, therefore, claims that D&L and Guangdong should not

be permitted to raise the issue at this late stage of the

proceedings. See Def.’s Comments at 13. D&L and Guangdong admit

that the error could have been found earlier. See D&L Supply

Company’s and Guangdong Metals & Minerals Import & Export

Corporation’s Rebuttal to Defendant’s Reply Comments Upon the

Remand Results (“Rebuttal”) at 14.

The issue before the Court, therefore, involves determining

the proper juncture in the administrative and judicial process at

which claims need to be raised in order to be decided on their

merits. The Court agrees with the government that D&L and

Guangdong should not be permitted to raise this issue. “It is well

established that ‘[a] reviewing court usurps the agency’s function

when it sets aside the administrative determination upon a ground

not theretofore presented and deprives the [agency] of an

opportunity to consider the matter, make its ruling, and state the
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 20

reasons for its action.’” Budd Co., Wheel & Brake Div. v. United

States, 15 CIT 446, 452, 773 F. Supp. 1549, 1554 (1991) (quoting

Unemployment Compensation Comm’n v. Aragon, 329 U.S. 143, 155

(1946)); see AIMCOR v. United States, 141 F.3d 1098, 1111 (Fed.

Cir. 1998) (Party was precluded from raising “issue de novo before

the court when it failed to present the issue during the applicable

comment period.”); 28 U.S.C. § 2637(d) (1988) (“[T]he Court of

International Trade shall, where appropriate, require the

exhaustion of administrative remedies.”). Because D&L and

Guangdong could have brought this issue before Commerce during

multiple earlier opportunities and failed to do so, the Court will

not consider it on its merits.

IV. Packing Value

D&L and Guangdong protest Commerce’s refusal to correct

alleged errors in the packing expenses used to calculate each

company’s FMV. See Rebuttal at 15. The parties claim that packing

expenses are calculated as a percentage of the cost of manufacture

(“COM”) and that every time an input such as the cost of freight

changes, the COM changes. See D&L’s Comments at 10. They argue,

therefore, that the cost of packing should be automatically

adjusted as are other percentages of prior costs. See id. D&L and

Guangdong also claim that because the packing value should change

automatically, it was not necessary to raise this issue earlier.
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 21

See id.

D&L and Guangdong had brought this issue before Commerce after

issuance of the Draft Remand Results. Commerce responded that

[b]ecause the packing adjustment is not directly affected
by the recalculation of inland freight, because these
respondents did not timely raise this issue before the
Court, and because the Court has not included such a
change in the remand order, in the interest of finality
the Department has not made this change.

Remand Results at 20. Commerce maintains that “the same constant

values, rather than a percentage of COM, have been part of the

programming with respect to the packing adjustment since the final

results of the original reviews, for which programs were created in

1991.” Def.’s Comments at 14. Commerce claims that because D&L

and Guangdong failed to raise this argument in the original suit,

before Commerce during the 1994 remand or in their comments to the

Court following the 1994 remand, Commerce “continued to use the

constant amounts, rather than the ‘COM times 1.5 percent’ formula,

in the final results of remand.” Id. at 16.

The Court will not reach the merits of D&L and Guangdong’s

contentions. D&L and Guangdong maintain that the packing expense

should be calculated as a percentage of COM, while Commerce applied

the packing figure as a constant value. Thus, there is a

fundamental dispute concerning the type of methodology Commerce

should have used in calculating packing expenses and whether it
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 22

resulted in error. Because the dispute centers on whether

Commerce’s method was erroneous, the Court cannot simply order that

the expenses be recalculated.

The dispute concerning methodology is exactly the type of

claim that D&L and Guangdong should have brought forth earlier in

this case’s long procedural history. The Court is not persuaded by

D&L and Guangdong’s argument that “[i]t was only when the COM was

reduced significantly as a result of the remands that the error

became noticeable–-as well as meaningful.” Rebuttal at 16.

“Judicial economy, fairness to the parties and the need to fulfill

Congress’s intent of prompt resolution of these matters requires

that errors of methodology, data selection, calculation, etc. all

be raised at the outset, unless some extraordinary factor supports

relief at a later date.” IPSCO, Inc. v. United States, 965 F.2d

1056, 1062 (Fed. Cir. 1992) (citation omitted). There is no such

extraordinary factor here. Although ensuring the accuracy of final

determinations is one countervailing factor,5 here, it is greatly

outweighed by considerations of fairness and finality, especially

since D&L and Guangdong had several opportunities to discover and

contest the alleged error. To allow the parties to bring an

overdue claim simply because they did not notice the allegedly

5
See Serampore Indus. Pvt. Ltd. v. United States, 12 CIT
825, 834, 696 F. Supp. 665, 673 (1988).
Consol. Court Nos. 91-02-00154 & 92-04-00283 Page 23

erroneous calculation provides no incentive for the parties to

perform a diligent review of the record and to raise claims at the

earliest reasonable opportunity.

Because the issue pertaining to packing expenses was not

timely raised, the Court will not consider it on its merits.

Commerce is affirmed.

CONCLUSION

Commerce has abided by the Court’s instructions on all

matters, including that pertaining to the “all others” rate. See

Sigma II, at *1; Remand Results at 8. Commerce’s determination is

affirmed in its entirety. Because all other issues have been

previously decided, this case is hereby dismissed.

______________________________
NICHOLAS TSOUCALAS
SENIOR JUDGE

Dated: February 10, 2000
New York, New York