Slip. Op. 99 - 18
UNITED STATES COURT OF INTERNATIONAL TRADE
BEFORE: RICHARD W. GOLDBERG, JUDGE
OLYMPIA INDUSTRIAL, INC.,
Plaintiff,
v.
THE UNITED STATES,
Consolidated
Defendant,
Court No. 95-10-01339
and
WOODINGS-VERONA TOOL WORKS, INC.,
Defendant-Intervenor.
[Second Remand Determination in the second administrative review of
the antidumping duty order of the U.S. Department of Commerce is
sustained.]
Dated: February 17, 1999
Powell, Goldstein, Frazer & Murphy LLP (Lawrence R. Walders),
for plaintiff Olympia Industrial, Inc.
David W. Ogden, Acting Assistant Attorney General; David M.
Cohen, Director, Commercial Litigation Branch, Civil Division,
United States Department of Justice (Henry R. Felix); Office of the
Chief Counsel for Import Administration, United States
Department of Commerce (Melanie A. Frank), of counsel, for
defendant.
Consol. Court No. 95-10-01339 Page 2
Wiley, Rein & Fielding (Charles Owen Verrill, Jr., Alan H.
Price, Willis S. Martyn III), for defendant-intervenor Woodings-
Verona Tool Works, Inc.
OPINION
GOLDBERG, Judge: In this action, the Court reviews the Department
of Commerce’s ("Commerce") Second Remand Determination, dated
August 31, 1998, of the Notice of Final Results of Administrative
Review: Heavy Forged Hand Tools, Finished or Unfinished, With or
Without Handles, from the People's Republic of China, 60 Fed.
Reg. 49,251 (Sept. 22, 1995) (hereinafter "Remand Results").1
Plaintiff, Olympia Industrial Inc. ("Olympia"), a respondent in
the underlying administrative review, contests the Remand Results
as unsupported by substantial evidence.
The Court exercises jurisdiction pursuant to 28 U.S.C. §
1581(c) (1994). The Court sustains the Remand Results.
1
Pursuant to the new antidumping and countervailing duty
regulations, all remand determinations dated after May 16, 1997,
are available on the International Trade Administration’s
website. See Antidumping Duties and Countervailing Duties, 62
Fed. Reg. 27296, 27330 (Dep’t of Commerce 1997) (rules and
regulations). The remand results from this case can be found at
http://www.ita.doc.gov/import_admin/records/remands/98-49.htm.
Consol. Court No. 95-10-01339 Page 3
I.
BACKGROUND
Olympia, a U.S. importer of heavy forged hand tools
("HFHTs") from the People’s Republic of China ("PRC"), and
defendant-intervenor, Woodings-Verona Tool Works, Inc.
("Woodings"), a U.S. producer of HFHTs and petitioner in the
underlying agency action, commenced this consolidated case under
19 U.S.C. § 1516a and 28 U.S.C. § 2631(c) (1994) seeking judicial
review of certain portions of the final results of Commerce’s
second administrative review. In particular, both parties
contested the dumping margins in the Final Results, focusing on
certain values employed by Commerce when it calculated the
foreign market value ("FMV") of the HFHTs imports using a factors
of production ("FOP") analysis.2 Initially, the Court rejected
certain challenges, yet remanded two issues: (1) the Court
ordered Commerce to reconsider whether surrogate country data or
PRC import data should be used to value the steel inputs for the
2
If Commerce cannot determine a FMV for a nonmarket
economy ("NME") respondent under the general provisions of 19
U.S.C. § 1677b(a), Commerce must instead use the FOP methodology
to estimate FMV for the merchandise in question. See 19 U.S.C. §
1677b(c)(1). In the administrative review on appeal, Commerce
resorted to a FOP analysis. See Final Results, 60 Fed. Reg. at
49,251-52.
Consol. Court No. 95-10-01339 Page 4
HFHTs; and (2) the Court ordered Commerce to reconsider its
methodology for calculating foreign inland freight expenses. See
Olympia Indus., Inc. v. United States, 21 CIT __, Slip Op. 97-44
(Apr. 10, 1997) ("Olympia I").
In considering Commerce’s first remand determination, the
Court sustained Commerce’s methodology for calculating inland
freight expenses. See Olympia Indus., Inc. v. United States, 22
CIT __, __, 7 F. Supp.2d 997, 1002 (1998) ("Olympia II"). The
Court, however, found that Commerce again failed to seek
additional information from the parties as to the reliability of
the PRC steel import data. Instead, Commerce rejected the data
in its entirety without review. In doing so, Commerce stated
that its policy was to evaluate inputs sourced from market-
economy suppliers only when those inputs are actually purchased
by the NME manufacturer. See Department of Commerce’s Results of
First Remand Determination (July 21, 1997) ("First Remand
Determination"), at 8-9. Because the import data at issue
related to inputs purchased by NME trading companies, not by NME
manufacturers, Commerce declined to solicit new information or to
use the existing PRC import data. Commerce then concluded that
"because there are no actual market-based prices for steel
Consol. Court No. 95-10-01339 Page 5
purchases by the manufacturer, we continue to use surrogate
country data to value the steel input used in the production of
HFHTs." First Remand Determination, at 9-10.
The Court rejected this treatment. See Olympia II, 22 CIT
at __, 997 F. Supp.2d at 1000-02. As a result, the Court again
remanded so that Commerce might consider whether the PRC trading
companies’ steel input data is the best information available to
value certain FOPs. Specifically, the Court instructed Commerce
to reopen the administrative record to investigate the
reliability of the PRC import data submitted by the trading
company. The Court now reviews Commerce’s compliance with these
instructions in its Remand Results.
II.
STANDARD OF REVIEW
Commerce’s remand determination will be sustained if it is
supported by substantial evidence on the record and is otherwise
in accordance with law. 19 U.S.C. § 1516a(b)(1)(B) (1994).
Consol. Court No. 95-10-01339 Page 6
III.
DISCUSSION
In accordance with the Court’s instructions in Olympia II,
Commerce reopened the record on remand to ascertain the
reliability of the PRC trading company data. Specifically,
Commerce requested information on (1) the volume and value of
trading company imports, (2) the type and quality of the steel
imported by the trading company, and (3) the level of steel
purchased from the trading company by the NME producers. See
Remand Results, at 7-8. Using this data, Commerce found that the
steel imported by the trading company "is of the same grade and
has the same range of diameters as steel that the NME
manufacturers used to produce the subject merchandise." Id. at
8. Yet, after examining the pricing data, Commerce found that
the prices paid by the trading company were aberrationally low,
even though purchased from a market-economy source and paid for
in convertible currencies. Id. Commerce therefore determined
that the PRC trading company pricing data was unreliable and,
hence, unacceptable for purposes of valuing the steel inputs used
to produce the HFHTs; instead, Commerce continued to use the
Indian surrogate country data to value the inputs in its FOP
analysis.
Consol. Court No. 95-10-01339 Page 7
Olympia challenges this decision as unsupported by
substantial evidence. Olympia asserts that Commerce only
concluded that the trading company prices were aberrationally low
by comparing the trading company data to average U.S. and
Indonesian pricing data. Olympia maintains this simple
comparison in and of itself proves nothing, much less which data
amounts to the best available information to value the steel used
to produce the Chinese hand tools. More specifically, Olympia
contends Commerce acknowledged that the PRC trading company data
reflects pricing for steel actually used by the NME producers,
whereas the same cannot be said for the steel imported into the
United States and Indonesia. Indeed, Olympia points out that the
U.S. and Indonesian data reflect pricing for general basket
categories of steel bars, not the specific type used by the NME
producers and imported by the trading company. Moreover, Olympia
argues that comparison to the U.S. and Indonesian data is
fundamentally flawed because the basket categories include forged
steel bars, and the PRC trading company only imported unforged
steel bars (and, forged bars are more expensive than unforged
bars, thereby skewing the U.S. and Indonesian average upwards).
Consol. Court No. 95-10-01339 Page 8
Thus, Olympia maintains Commerce’s remand determination is
unsupported by substantial evidence.
The Court does not agree. It is true the record shows that
the PRC producers subjected the steel bars to the forging
process; the record, however, does not show that the PRC trading
company imported unforged steel bars. See Remand Results, at 12.
Commerce also found discrepancies regarding the amount of steel
purchased from the trading company and the amount ultimately used
by the NME manufacturers. Id. at 9. The Court has examined this
confidential record evidence and finds that Commerce properly
exercised its discretion when it used the U.S. and Indonesian
data as a benchmark to determine whether the trading company data
was aberrational. The Court holds that the record supports
Commerce’s conclusion that the PRC trading company data was
aberrational and unreliable. It was therefore appropriate for
Commerce to use the Indian surrogate data to value the steel
inputs, and the Court finds this decision supported by
substantial evidence.
The Court notes in closing that in its Remand Results,
Commerce again made the argument that its first remand
determination was correct and that under the statutory framework
Consol. Court No. 95-10-01339 Page 9
it is not required to investigate whether NME trading company
data should be used to value inputs for subject merchandise in a
FOP analysis. For the reasons discussed in Olympia II, Commerce
again is wrong; when Commerce is presented with NME trading
company data, it must seek information to assess the reliability
of the data and then ascertain whether it constitutes the best
available information for purposes of the FOP analysis. It is
not enough to reject the information out of hand. Commerce’s
simple intransigence on this point does not merit further
response.
IV.
CONCLUSION
For the forgoing reasons, the Court sustains Commerce’s
Remand Results as supported by substantial evidence. A separate
order will be entered accordingly.
_________________________________
Richard W. Goldberg
JUDGE
Dated: February 17, 1999
New York, New York.