Beijing Tianhai Industry Co. v. United States
2017 CIT 79
| Ct. Intl. Trade | 2017Background
- Commerce issued a final antidumping determination on high-pressure steel cylinders from the PRC (May 2012), finding BTIC engaged in "targeted dumping" for Oct–Dec 2010 and assigning a 6.62% margin. Commerce applied the average-to-transaction (A‑T) method with zeroing to all BTIC U.S. sales during the POI, not just the identified targeted sales.
- The withdrawn 19 C.F.R. § 351.414(f)(2) (the "Limiting Regulation") had previously stated Commerce would normally limit A‑T to only the sales constituting the targeted pattern. Commerce attempted to withdraw that regulation in 2008.
- BTIC challenged Commerce’s use of A‑T on all sales and relied on the Limiting Regulation’s rationale; the court remanded twice for Commerce to explain why A‑A and transaction‑to‑transaction (T‑T) methods could not account for the pattern.
- On second remand, Commerce applied a "meaningful difference" analysis comparing A‑A and A‑T margins using 100% of U.S. sales and concluded A‑T revealed above‑de minimis dumping while A‑A showed none.
- After the Second Remand Results, the Federal Circuit decided Mid Continent Nail, holding Commerce’s 2008 withdrawal of the Limiting Regulation violated the APA and was not harmless; the Limiting Regulation therefore remained in effect at the time of Commerce’s Final Determination.
- BTIC moved under Rule 54(b) to revise the court’s earlier interlocutory ruling (BTIC I) in light of Mid Continent; the court grants the motion and remands to Commerce to apply the Limiting Regulation and reconsider scope of A‑T application and margin calculations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce lawfully applied A‑T to 100% of BTIC's U.S. sales rather than only targeted sales | BTIC: Applying A‑T to all sales is contrary to the Limiting Regulation’s rationale and punitive where only a small portion of sales were targeted | Gov: Commerce’s interpretation permitting A‑T on all sales is reasonable and entitled to deference; limitation was withdrawn | Court: Mid Continent controls; Limiting Regulation remained in effect for the Final Determination, so Commerce must reconsider applying A‑T to all sales |
| Whether Commerce adequately explained that A‑A cannot account for the price pattern | BTIC: A‑A can and should account for differences; Commerce failed to explain why A‑A is inadequate | Gov: Commerce’s "meaningful difference" analysis shows A‑A masked dumping while A‑T revealed it | Court: Remand ordered for Commerce to reconsider whether A‑A can account for pattern in light of Limiting Regulation and Mid Continent |
| Whether the withdrawal of the Limiting Regulation was valid under the APA | BTIC: Withdrawal was procedurally invalid and Limiting Regulation should bind Commerce | Gov/Norris: BTIC waived challenge by not raising it in opening brief; or withdrawal was lawful | Court: Mid Continent found withdrawal invalid and not harmless; court revises BTIC I and rejects harmless‑error rationale; remand required |
| Whether BTIC waived the right to press the Limiting Regulation issue | BTIC: Did not waive; raised related challenges and later submitted supplemental briefing as requested | Norris: BTIC waived by failing to raise issue in opening brief | Court: Waiver doctrine is prudential; parties had ample opportunity to brief the withdrawal; Mid Continent is intervening controlling authority, so remand appropriate |
Key Cases Cited
- Mid Continent Nail Corp. v. United States, 846 F.3d 1364 (Fed. Cir. 2017) (held Commerce unlawfully withdrew the Limiting Regulation without notice and comment and the error was not harmless)
- Koyo Seiko Co. v. United States, 95 F.3d 1094 (Fed. Cir. 1996) (law‑of‑the‑case exception for intervening controlling authority)
- SKF USA, Inc. v. United States, 254 F.3d 1022 (Fed. Cir. 2001) (remand required when intervening events may affect agency action)
- Arizona v. California, 460 U.S. 605 (U.S. 1983) (discussion of law‑of‑the‑case doctrine)
- SmithKline Beecham Corp. v. Apotex Corp., 439 F.3d 1312 (Fed. Cir. 2006) (arguments not raised in opening brief are generally waived)
- Novosteel SA v. United States, 284 F.3d 1261 (Fed. Cir. 2002) (prudential waiver and fairness considerations in appellate briefing)
- Union Steel v. United States, 713 F.3d 1101 (Fed. Cir. 2013) (definition of zeroing and context for dumping margin calculations)
- Timken Co. v. United States, 6 C.I.T. 76 (CIT 1983) (recognition of court’s plenary power to alter prior nonfinal rulings)