ABB Inc. v. United States, 355 F. Supp. 3d 1206

Background

ABB and Hyosung challenged Commerce's final results in the second administrative review of antidumping duties on large power transformers (Korea, 2013–2014), raising disputes over Commerce's treatment of U.S. commissions and revenue capping for service-related charges.
The Government requested a voluntary remand to reconsider Commerce's treatment of U.S. commissions; the court granted the remand and directed Commerce to ensure consistent application of its revenue-capping practice between respondents.
On remand, Commerce: (a) declined to grant home‑market commission offsets for commissions incurred in the United States (treating such commissions as CEP expenses deducted from constructed export price), and (b) reexamined Hyundai’s reporting of gross U.S. prices and applied partial adverse facts available (AFA) to reduce gross unit prices where Commerce found unreported service‑related revenue exceeding related expenses.
Hyundai and Hyosung challenged Commerce’s Remand Results: both disputed denial of commission offsets; Hyundai additionally challenged Commerce’s use of partial AFA and reliance on internal documents to find separately negotiable service revenues.
The Court sustained Commerce’s treatment of U.S. commissions (following its prior AR1 analysis) but remanded on the service‑related revenue issue: Commerce may not apply its capping methodology where its finding relied solely on internal communications among Hyundai employees/affiliates; and Commerce must further explain or reconsider its use of an adverse inference when applying partial AFA.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Denial of home‑market commission offsets for commissions incurred in the U.S.	Hyundai/Hyosung: statutory/regulatory text does not support geographic distinction; denying offsets is inconsistent treatment.	Commerce/Gov: Commissions incurred in U.S. are CEP expenses to be deducted from CEP; commissions incurred outside U.S. are treated under circumstances‑of‑sale adjustments to NV.	Sustained: geographic distinction upheld as consistent with statute, regs, and SAA and with court's earlier AR1 decision.
Whether Commerce may cap service‑related revenue by related expenses when revenue appears only in internal documents (not in customer invoices/purchase orders)	Hyundai: Commerce changed reporting standard, relied on internal notes, and failed to meet § 1677m(d) notice/cure obligations; thus AFA and capping unsupported.	Commerce/Gov: Reporting requirement to separately report service revenues remained; Hyundai failed to provide requested information and did not timely disclose invoices discovered at verification.	Partial grant/partial denial: Commerce may apply capping where record shows separate, negotiable service charges in documents exchanged with unaffiliated customers; Commerce may not apply capping where it relied solely on internal communications. Remanded for reconsideration on certain transactions.
Use of partial adverse facts available (AFA) to adjust Hyundai's U.S. gross prices	Hyundai: AFA unsupported because Commerce did not adequately explain failure to act to the best of its ability; § 1677m(d) procedures not followed.	Gov./ABB: Hyundai had the requested information, failed to provide it, and Commerce discovered the omission only at verification, so § 1677m(d) does not require a cure opportunity.	Remanded: Commerce applied AFA but provided inadequate explanation linking statutory "best of its ability" standard to facts; must further explain or reconsider adverse inference.
Whether Commerce was required to issue deficiency notice under 19 U.S.C. § 1677m(d) before using AFA	Hyundai: § 1677m(d) required notice and opportunity to cure deficiencies.	Gov.: Commerce did not know of deficiencies until verification; Hyundai submitted no responsive information to cure.	Held for Government on notice requirement: Commerce was not required to issue cure notice where it lacked awareness of deficiencies; but AFA use still required fuller factual explanation.

Key Cases Cited

Dongbu Steel Co. v. United States, 635 F.3d 1363 (Fed. Cir. 2011) (requires Commerce to reasonably explain inconsistent statutory interpretations across proceeding segments)
Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) (standards for "best of its ability" and limits on drawing adverse inferences)
Jiaxing Bro. Fastener Co. v. United States, 822 F.3d 1289 (Fed. Cir. 2016) (each administrative review is based on its own record)
ABB, Inc. v. United States, 273 F.Supp.3d 1186 (Ct. Int’l Trade 2017) (Court sustained Commerce’s treatment of U.S. commissions in AR1 and articulated agency rationale)
SolarWorld Ams., Inc. v. United States, 273 F.Supp.3d 1314 (Ct. Int’l Trade 2017) (remand‑redetermination review standard and compliance with remand orders)
Dongguan Sunrise Furniture Co. v. United States, 865 F.Supp.2d 1216 (Ct. Int’l Trade 2012) (discusses Commerce’s revenue‑capping practice and reasonableness)