Navneet Publ'ns (India) Ltd. v. United States

Slip Op. 15- 

UNITED STATES COURT OF INTERNATIONAL TRADE

NAVNEET PUBLICATIONS (INDIA)
LTD., MARISA INTERNATIONAL,
SUPER IMPEX, PIONEER STATIONARY Before: Richard W. Goldberg, Senior Judge
PVT. LTD., SGM PAPER PRODUCTS, Court No. 13-00204
LODHA OFFSET LIMITED, and MAGIC
INTERNATIONAL PVT. LTD.,

Plaintiffs,

v.

UNITED STATES,

Defendant,

and

ASSOCIATION OF AMERICAN SCHOOL
PAPER SUPPLIERS,

Defendant-Intervenor.

OPINION

[Sustaining the Department of Commerce’s 0.5% all-others antidumping rate on remand.]

Dated: 0D\

Neil R. Ellis, Richard L.A. Weiner, and Rajib Pal, Sidley Austin LLP, of Washington,
DC, for plaintiffs.

Antonia R. Soares, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, of Washington, DC, for defendant. With her on the brief were Joyce R.
Branda, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M.
McCarthy, Assistant Director. Of counsel on the brief was Elika Eftekhari, Office of the Chief
Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of
Washington, DC.

Alan H. Price, Timothy C. Brightbill, and Maureen E. Thorson, Wiley Rein LLP, of
Washington, DC, for defendant-intervenor.
Court No. 13-00204 Page 2

Goldberg, Senior Judge: This case comes before the court following remand. In its

previous opinion, the court invalidated the 11.01% weighted average dumping margin that the

U.S. Department of Commerce (“Commerce” or “the agency”) had established for companies

that neither failed to cooperate with the agency nor were selected for individual investigation (the

“all-others rate” or “rate”). The court gave two reasons: (1) Commerce justified the all-others

rate partly on the basis of the low number of individually investigated companies, which was a

product of Commerce’s own decision-making, and (2) Commerce failed to corroborate the rate

with economic reality. Navneet Publ’ns (India) Ltd. v. United States, 38 CIT __, __, 999 F.

Supp. 2d 1354, 1362–66 (2014). On remand, Commerce provided a new all-others rate together

with a reasonable explanation of that rate. The court accordingly sustains Commerce’s

redetermination.

BACKGROUND

The court presumes familiarity with its prior opinion, including the explanation of the

role of all-others rates, and the statutory guidelines for establishing those rates set forth in 19

U.S.C. § 1673d(c)(5) (2012).1 The abridged facts that follow will suffice for the sake of this

decision.

In 2011, Commerce initiated its fifth administrative review of an antidumping duty order

on certain lined paper products from India. Initiation of Antidumping and Countervailing Duty

Administrative Reviews, 76 Fed. Reg. 67,133, 67,134 (Dep’t Commerce Oct. 31, 2011). The

review covered fifty-seven Indian producers and exporters of the subject merchandise. Resp’t

Selection Mem. at 2–3, PD 61 (Jan. 20, 2012). Commerce determined that it could not

individually investigate all fifty-seven companies subject to the review and instead limited its

1
The statutory provisions are called as guidelines because they expressly apply only to investigations, but
Commerce nonetheless uses the provisions to inform its analysis in administrative reviews. Navneet, 38 CIT at __,
999 F. Supp. 2d at 1358.
Court No. 13-00204 Page 3

review to the two respondents accounting for the largest known volume of subject merchandise.

Id. at 7–8; see 19 U.S.C. § 1677f-1(c)(2). The two individually investigated respondents were

Riddhi Enterprises (“Riddhi”) and SAB International (“SAB”). Resp’t Selection Mem. at 9. In

its Final Results, Commerce assigned zero percent individual rates to both Riddhi and SAB.

Certain Lined Paper Products from India, 78 Fed. Reg. 22,232, 22,234 (Dep’t Commerce Apr.

15, 2013) (final admin. review).

For the other fifty-five companies, Commerce assigned one of two rates. Four companies

had not cooperated by providing data during the administrative review; as a result, Commerce

applied an adverse facts available (“AFA”) rate of 22.02%. Id. at 22,233–34. The AFA rate

matched the highest non-aberrational transaction-specific dumping margin calculated for Riddhi

during the review. Id.

With respect to companies that were neither uncooperative nor selected for individual

investigation, Commerce applied a rate of 11.01%. Id. Commerce established the 11.01% rate

by simple averaging both individually investigated respondents’ zero-percent rates with 22.02%

rates from two of the uncooperative companies. Id. Commerce chose this method pursuant to 19

U.S.C. § 1673d(c)(5)(B). Under that provision, Commerce chooses “any reasonable method” for

establishing all-others rates when, inter alia, all individually investigated respondents have been

assigned zero-percent rates. Id.; see also Issues & Decision Mem. (“I&D Mem.”) at 13–14, PD

188 (Apr. 9, 2013).2 According to Commerce, including uncooperative companies’ AFA rates in

the all-others average was reasonable because, without data from the uncooperative companies,

2
In choosing the method, Commerce forewent both the “reasonable method” expressly contemplated in
§ 1673d(c)(5)(B) and another “reasonable method” the agency had used in past reviews. The “reasonable method”
contemplated by statute is to average individually investigated respondents’ rates; the method used in past reviews is
to average recently calculated non-zero rates (from either individually investigated respondents or all-others
companies, depending on the circumstances). See I&D Mem. at 13–14. Commerce explained that it did not use the
“reasonable method” from past reviews because all recent non-zero rates had been calculated using the zeroing
methodology, which the agency no longer employs. Id.
Court No. 13-00204 Page 4

Commerce could not know whether the individually investigated respondents’ zero-percent rates

“serve[d] as a proper basis” for establishing the all-others rate. I&D Mem. at 14. Commerce

limited the number of AFA rates to two because that was the number of respondents Commerce

had determined it could individually investigate. Id. As such, had the uncooperative companies

cooperated, Commerce might have individually investigated “up to two.” Id.

Plaintiffs (all of them companies assigned the all-others rate) filed suit at the Court of

International Trade on May 15, 2013. Summons, ECF No. 1. Plaintiffs claimed that

Commerce’s decision to include AFA rates in the all-others average was both contrary to statute

and unsupported by substantial evidence.

The court accepted plaintiffs’ substantial-evidence claim, and accordingly invalidated the

11.01% all-others rate. Navneet, 38 CIT at __, 999 F. Supp. 2d at 1362–66. The court offered

two reasons for its holding. First, Commerce’s inability to confirm the representativeness of

Riddhi’s and SAB’s zero-percent rates was in part a product of Commerce’s own decision to

individually investigate only those two companies. Id. at 1363. Second, Commerce had failed to

“verify that the [11.01% rate] reflects economic reality.” Id. Commerce never cited any record

evidence corroborating the accuracy of the 11.01% rate, and, in fact, record evidence

affirmatively undermined that rate. Id. at 1363–64.

As to Commerce’s failure to square the 11.01% rate with record evidence, the court

rejected a belated argument made by the Government during litigation. Id. at 1364. The

Government had noted that the AFA rate matched Riddhi’s highest non-abberational transaction-

specific margin, and also argued that the 11.01% was not “far in excess” of Riddhi’s or SAB’s

zero-percent rates. Id. at 1364. The court rejected the Government’s reasoning as outside the

agency record. The court also explained that the AFA rate was “purposely selected with
Court No. 13-00204 Page 5

adversity in mind,” and that merely asserting that 11.01% was not “far in excess” of zero percent

did not constitute substantial evidence. Id.

As to record evidence affirmatively undermining the 11.01% all-others rate, the court

highlighted two sets of evidence. First, the all-others rates in the past four reviews stood

between one and four percent, and correlated closely with the rates for individually investigated

respondents. Id. at 1364–65. Second, comparing Riddhi’s and SAB’s average unit values to

those of six all-others respondents suggested that the six respondents should have lower rates.

Id. at 1365–66. Based on the foregoing, the court remanded for Commerce to reconsider its

method of establishing the all-others rate.

On remand, Commerce assigned an all-others rate of 0.5%, the lowest rate above de

minimis. Final Results of Redetermination Pursuant to Ct. Remand 7, 14, ECF No. 71 (“Remand

Results”).3 In order to reach this rate, Commerce made an assumption about the behavior of the

uncooperative companies that had been assigned the 22.02% AFA rate: namely, that those

companies acted rationally, choosing not to cooperate because that course of action yielded the

companies a lower rate than cooperation would. Id. at 13–14. Based on this assumption,

Commerce inferred that the uncooperative companies’ dumping margins were neither zero nor

de minimis during the period of review. Id. Commerce next reasoned that, had the companies

cooperated, Commerce might have selected “up to two” as mandatory respondents. Id. Had

Commerce done so, it would have established an all-others rate above de minimis. Id.; see 19

U.S.C. § 1673d(c)(5)(A). Commerce therefore concluded that a 0.5% all-others rate—above de

minimis—was reasonable. Finally, to buttress this conclusion, Commerce noted that Riddhi and

SAB had non-aberrational transaction-specific margins that were above de minimis, including the


3
Under 19 C.F.R. § 351.106(c), Commerce treats review rates below 0.5% as de minimis, and declines to
levy antidumping duties.
Court No. 13-00204 Page 6

22.02% transaction-specific margin that formed the basis for the AFA rate. Remand Results 7,

14.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction to hear this appeal under 28 U.S.C. § 1581(c). The court will

sustain the agency’s decisions unless they are “unsupported by substantial evidence on the

record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i).

DISCUSSION

The court now sustains the Remand Results. The court previously invalidated

Commerce’s 11.01% all-others rate for two reasons: (1) Commerce justified the rate partly on

the basis of the low number of individually investigated companies, which was a product of

Commerce’s own decision-making, and (2) Commerce failed to corroborate the rate with

economic reality. On remand, Commerce remedied both of these defects through a new 0.5%

all-others rate supported by substantial evidence.

I. Commerce’s 0.5% All-Others Rate is Supported by Substantial Evidence

The court holds that Commerce’s new all-others rate is supported by substantial

evidence, because the agency’s new rate remedies both of the defects that justified the court’s

remand. First, rather than impermissibly relying on the dearth of individually investigated

companies to justify the 0.5% rate, Commerce instead based the 0.5% rate on the behavior of the

uncooperative companies. Commerce assumed that the companies’ failure to cooperate was a

rational choice, that is, that the companies would have cooperated if cooperation would yield

them a lower rate. Remand Results 13–14. This assumption is supported by precedent from the

Federal Circuit, as well as by prior opinions of this court. See Ta Chen Stainless Steel Pipe, Inc.

v. United States, 298 F.3d 1330, 1339 (Fed. Cir. 2002) (inferring from respondent’s
Court No. 13-00204 Page 7

noncooperation that the “highest [previously calculated] margin reflects the current margin[]”

(citing Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1190 (Fed. Cir. 1990))); Tianjin

Mach. Imp. & Exp. Corp. v. United States, 35 CIT __, __, 752 F. Supp. 2d 1336, 1347 (2011)

(“In other words, [Rhone Poulenc] stands for the proposition that a respondent can be assumed to

make a rational decision to either respond or not respond to Commerce’s questionnaires, based

on which choice will result in the lower rate.”). Commerce next inferred that the uncooperative

companies’ actual dumping margins were neither zero nor de minimis. Remand Results 13–14.

And Commerce finally reasoned that, had Commerce selected one or more uncooperative

companies for individual investigation, the agency would have established an all-others rate

above de minimis. Id.; see 19 U.S.C. § 1673d(c)(5)(A). Therefore, a rate of 0.5%, above de

minimis, was appropriate. Id. These latter steps in Commerce’s reasoning, too, are supported by

prior opinions of this court. See Changzhou Hawd Flooring, Co. v. United States, 39 CIT __, __,

Slip Op. 15-07 at 13–16 (Jan. 23, 2015); Changzhou Wujin Fine Chem. Factory Co. v. United

States, 37 CIT __, __, 942 F. Supp. 2d 1333, 1340 (2013). In sum, Commerce justified the 0.5%

rate not by referencing a shortage of individually investigated companies—a course the court

invalidated in its prior opinion—but rather by invoking reasoning tested and approved by the

courts.

Commerce’s 0.5% all-others rate also cures the second defect with the original 11.01%

rate, insofar as the new rate comports with economic reality. As Commerce noted, both

individually investigated companies had non-aberrational transaction-specific margins above the

de minimis threshold, thus suggesting “some amount of dumping” during the period of

investigation. Remand Results 7, 14. Provided that some dumping occurred during the period of

investigation, applying an above de minimis all-others rate makes sense. Furthermore, the 0.5%
Court No. 13-00204 Page 8

all-others rate aligns with rates in past reviews, which invariably fell between one and four

percent. Navneet, 999 F. Supp. 2d at 1364–65.

Defendant-intervenor American Association of School Paper Suppliers (“AASPS”)

counters that the 0.5% all-others rate cannot reflect economic reality because the uncooperative

companies were assigned AFA rates of 22.02%, a far cry from 0.5%. Def.-Intervenor Ass’n of

Am. Sch. Paper Suppliers’ Cmts. on Final Results of Redetermination Pursuant to Ct. Remand

6–7, ECF No. 68 (“AASPS Comments”). This argument fails because it conflates the economic

reality of the uncooperative companies with that of plaintiffs (who were neither uncooperative

nor selected for individual investigation). On remand, Commerce was tasked only with ensuring

that the all-others rate reflected plaintiffs’ reality. Navneet, 999 F. Supp. 2d at 1363–64. That

the 0.5% all-others rate aligns with all-others rates from past reviews suggests that Commerce

fulfilled this task. See id. at 1364–65. Besides, the 22.02% AFA rate was “purposely selected

with adversity in mind,” suggesting that it makes a poor bellwether for the economic reality of

even the uncooperative companies. Id. at 1364.

In sum, Commerce’s 0.5% all others rate is supported by substantial evidence. Rather

than relying on an absence of evidence to reach the 0.5% rate, Commerce reasonably inferred an

above de minimis rate from the behavior of the uncooperative companies. Furthermore, the 0.5%

rate comports with plaintiffs’ economic reality.

II. Commerce Was Not Compelled to Adopt AASPS’s Proposed 7.34% All-Others
Rate

AASPS proposes a 7.34% all-others rate. AASPS Comments 7–9.4 AASPS reaches this

rate by averaging the zero-percent rates of Riddhi and SAB with the 22.02% AFA rate from one


4
AASPS also reiterates the argument it made prior to remand, that the 11.01% all-others rate was
reasonable for the reasons stated by Commerce in the I&D Memo. AASPS Comments 4–6. These reasons have
(footnote continued)
Court No. 13-00204 Page 9

uncooperative company. According to AASPS, this is the most reasonable rate because it is

“within the realm of all-others rates calculated in prior reviews,” “is based on margins actually

calculated in the underlying review,” and comports with a “recently assigned . . . preliminary

dumping margin of 7.79%.” Id.

Despite AASPS’s proposal, Commerce was not compelled to adopt a 7.34% all-others

rate. First, the 7.34% rate is more than five times all but one past all-others rate, and all but two

past mandatory respondents’ rates. Navneet, 38 CIT at __, 999 F. Supp. 2d at 1364–65.

Therefore, to the extent that the 7.34% rate can be considered “within the realm” of past all-

others rates, the 0.5% rate is still closer. AASPS Comments 7. Second, there is no requirement

that Commerce arrive at the all-others rate through an average of rates from the current review.

19 U.S.C. § 1673d(c)(5)(B) instructs Commerce to “establish” (as opposed to “calculate”) the

all-others rate, and this court has held that “establish” is the broader of the two terms.

Changzhou Hawd Flooring, 39 CIT at __, Slip Op. 15-07 at 11. If averaging current-review

rates leads to a rate that runs counter to economic reality, then assigning a rate close to past all-

others rates can be reasonable. All the more so because the court remanded to Commerce

following the agency’s initial decision to assign an average-based rate, which the agency had

calculated using a methodology similar to the one used to calculate the 7.34% rate. Navneet, 38

CIT at __, 999 F. Supp. 2d at 1362–66. Third, the 7.34% rate’s resemblance to a single

preliminary dumping margin (7.79%) is outmatched by the 0.5% rate’s similarity to an array of

past all-others rates (which do not exceed 3.05%). Id. at 1364–65. Finally, even were the 7.34%

rate itself reasonable (even the most reasonable), that would not render the 0.5% rate

already been rejected by the court. Navneet, 999 F. Supp. 2d at 1362–66. Moreover, the fact that another all-others
rate might have been reasonable does not indicate that the all-others rate now adopted by Commerce is
unreasonable. See Consolo v. Fed. Maritime Comm’n, 383 U.S. 607, 620 (1966).
Court No. 13-00204 Page 10

unreasonable: Commerce has discretion to choose between reasonable alternatives, and it did so

here. See Consolo v. Fed. Maritime Comm’n, 383 U.S. 607, 620 (1966).

III. Commerce Need Not Adopt Plaintiffs’ Proposed Zero-Percent All-Others Rate

Although plaintiffs “conditionally support” Commerce’s decision to assign an all-others

rate of 0.5%, plaintiffs also propose a zero-percent rate. Cmts. of Non-Selected Resp’ts on Draft

Remand Redetermination (“Pls.’ Comments”) at 3–7, PD 4 (Nov. 17, 2014).5 According to

plaintiffs, the court’s opinion prior to remand bore the “strong implication” that the proper all-

others rate was zero percent. Pls.’ Comments at 3, 6. Plaintiffs further argue that this case is

analogous to Honey from Argentina, 77 Fed. Reg. 36,253 (Dep’t Commerce June 18, 2012)

(final admin. review), where the court reached a zero-percent all-others rate by averaging the

zero-percent rates of both individually investigated companies. Pls.’ Comments at 5–6 (citing 77

Fed. Reg. 36,253 and accompanying I&D Mem. at cmt. 1).6

The court disagrees. First, it is Commerce’s province, not the court’s, to establish the all-

others rate. The court’s review is limited to ensuring that the rate established by Commerce is a

reasonable one. See Nippon Steel Corp. v. United States, 458 F.3d 1345, 1351–52 (Fed. Cir.

2006). Put another way, the court may not imply proper or improper rates. And given that the

0.5% all-others rate chosen by Commerce hews closely to past all-others rate, the court cannot

5
In their comments before this court, plaintiffs adopted their comments on the draft remand results. Pls.’
Cmts. on Remand Results, ECF No. 69.
6
Plaintiffs also argue that Commerce assigned a 0.5% all-others rate because the agency labored under the
mistaken belief that 19 U.S.C. § 1673d(c)(5) is binding and forbids a zero or de minimis rate. Pls.’ Comments at 3–
6. Plaintiffs cite Honey from Argentina as evidence that Commerce is not so bound. But the court does not read
Commerce’s Remand Results to be premised on the assumption that statute forbids a zero or de minimis rate, and
therefore rejects plaintiffs’ argument.
Finally, plaintiffs argue that Commerce should explicitly acknowledge a preliminary injunction issued by
this court on October 6, 2014, pertaining to the seventh administrative review. Pls.’ Comments at 9 (citing Navneet
Publ’ns (India) Ltd. v. United States (Navneet Preliminary Injunction Order), 38 CIT __, Slip Op. 14-119 (Oct. 6,
2014)). In the injunction order, the court specified that the all-others rate from the fifth review (that is, the rate at
issue in this remand) would also be applied in the seventh review. Navneet Preliminary Injunction Order, 38 CIT at
__, Slip Op. 14-119 at 6. Commerce has thus far complied with the court’s October 6 order, and the court expects
that the agency will continue to do so.
Court No. 13-00204 Page 11

hold Commerce’s choice to be unreasonable. Navneet, 38 CIT at __, 999 F. Supp. 2d at 1364–

65.

Second, Honey from Argentina is meaningfully distinguishable from this case. In Honey

from Argentina, Commerce assigned a zero-percent all-others rate in part because the

individually investigated respondents received de minimis rates not only in the immediate

review, but also in three previous reviews. 77 Fed. Reg. 36,253 and accompanying I&D Mem. at

cmt. 1. In this case, by contrast, the individually investigated respondents never received a de

minimis rate before the review at issue. See Navneet, 38 CIT at __, 999 F. Supp. 2d at 1364–65.

There is therefore less evidence suggesting the propriety of a zero-percent all-others rate.

CONCLUSION

The court originally remanded to Commerce because the agency explained its choice of

all-others rate through reference to inadequacies the agency itself had created, and also because

Commerce’s chosen rate failed to comport with economic reality. On remand, Commerce

addressed both concerns. The court sustains the agency’s remand redetermination, and judgment

will enter accordingly.

/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge

Dated: 0D\
New York, New York