817 F.3d 1332
Fed. Cir.2016Background
- Commerce issued an antidumping duty order (Oct. 29, 2002) covering hot-rolled steel wire rod with diameter 5.00 mm to <19.00 mm; non-investigated Mexican exporters got a 20.11% "all-others" rate.
- Deacero (Mexican producer) later produced and imported 4.75 mm wire rod (0.25 mm smaller than the order's lower limit).
- U.S. wire-rod producers requested an anti-circumvention inquiry; Commerce instituted a minor-alteration inquiry and found 4.75–5.00 mm rod to be within the order by virtue of minor alterations (affirmative circumvention).
- The U.S. Court of International Trade (Trade Court) remanded, finding Commerce’s determination unsupported because 4.75 mm fell outside the literal scope and was commercially available pre-order; Commerce then issued a negative determination under protest and the Trade Court affirmed that negative result.
- The government and U.S. industry appealed; the Federal Circuit held Commerce’s original affirmative minor-alteration circumvention finding was supported by substantial evidence and in accordance with law, reversed the Trade Court, and reinstated Commerce’s initial affirmative determination.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce may treat products outside a duty-order’s literal size range as covered via the minor-alteration (anti-circumvention) provision | Deacero: If product was outside literal scope and commercially available pre-order, it cannot be an "altered" subject product; Wheatland bars treating explicitly excluded or well-known products as subject | Government: Minor-alteration provision exists to capture goods outside literal scope; Commerce may apply five-factor test to determine "minor" alteration regardless of literal scope | Held for Government: Duty-order size range is not an express exclusion; Commerce may pursue minor-alteration inquiries to reach non-literal-scope products |
| Whether record shows 4.75 mm rod was commercially available before the petition (which would undermine a minor-alteration finding) | Deacero: Evidence shows small-diameter rod existed (e.g., in Japan in 1998) and served different uses, so it was not an "alteration" of subject merchandise | Government: Availability in non-investigated countries is irrelevant; Commerce’s record supports that 5.5 mm was the smallest diameter produced in investigated countries at petition time; 4.75 mm matched subject merchandise on the five-factor test | Held for Government: Substantial evidence supports Commerce’s finding that relevant investigated-country production began at 5.5 mm and the 4.75 mm product met the minor-alteration criteria; commercial availability elsewhere did not preclude the inquiry |
Key Cases Cited
- Wheatland Tube Co. v. United States, 161 F.3d 1365 (Fed. Cir.) (minor-alteration inquiries inappropriate when order expressly excludes the product)
- Nippon Steel Corp. v. United States, 219 F.3d 1348 (Fed. Cir.) (upholding anti-circumvention inquiry where change was insignificant and product not expressly excluded)
- Target Corp. v. United States, 609 F.3d 1352 (Fed. Cir.) (Commerce may treat non-literal-scope articles as within an order to combat circumvention)
- Downhole Pipe & Equip., L.P. v. United States, 776 F.3d 1369 (Fed. Cir.) (standard of review for Trade Court decisions reviewing Commerce)