Changzhou Hawd Flooring Co. v. United States
2017 U.S. App. LEXIS 2626
| Fed. Cir. | 2017Background
- Commerce investigated antidumping of multilayered wood flooring from China (2010–11) and selected the three largest exporters by volume as mandatory respondents.
- After investigation and a remand, Commerce found all three mandatory respondents had zero or de minimis dumping margins.
- 74 Chinese firms rebutted the PRC nonmarket-economy presumption and qualified for a "separate rate" but were not individually investigated; Commerce nonetheless assigned them an above-de minimis separate rate (initially 6.41% by averaging with the China-wide rate, later leaving the rate unspecified but > de minimis).
- The Court of International Trade upheld Commerce’s approach; appellants (separate-rate firms) appealed claiming they were entitled to a de minimis separate rate and removal from the antidumping order.
- The Federal Circuit held that Commerce departed from the congressionally preferred "expected method" (averaging the individually investigated zero/de minimis margins) without making the required substantial-evidence findings showing the mandatory respondents were unrepresentative.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce erred by not assigning a de minimis separate rate when all individually investigated respondents had zero/de minimis margins | Appellants: Commerce must apply the expected method (weight-average the zero/de minimis margins) and thus assign a de minimis separate rate | Commerce: Statute allows "any reasonable method"; its departure is justified because non-responding firms would have produced higher rates and later administrative review showed dumping | Court: Vacated and remanded — Commerce failed to make substantial-evidence findings required to depart from the expected method and must reconsider the separate-rate determination |
Key Cases Cited
- Albemarle Corp. & Subsidiaries v. United States, 821 F.3d 1345 (Fed. Cir. 2016) (Congressional preference for weighting zero/de minimis margins; departure requires substantial-evidence finding of unrepresentativeness)
- Yangzhou Bestpak Gifts & Crafts Co. v. United States, 716 F.3d 1370 (Fed. Cir. 2013) (standard for reviewing Commerce’s separate-rate calculations and reasonableness review)
- Dupont Teijin Films USA, LP v. United States, 407 F.3d 1211 (Fed. Cir. 2005) (effect of de minimis margins on exclusion from final determination)
- Tung Mung Dev. Co. v. United States, 354 F.3d 1371 (Fed. Cir. 2004) (de minimis margins treated as zero for certain statutory consequences)
- Nat’l Knitwear & Sportswear Ass’n v. United States, 779 F. Supp. 1364 (Ct. Int’l Trade 1991) (representativeness of investigated respondents justifies using their weighted average for all-others rate)