Diamond Sawblades Manufacturers Coalition v. United States
2017 U.S. App. LEXIS 14483
| Fed. Cir. | 2017Background
- Commerce investigated dumping of diamond sawblades from the PRC and issued a PRC-wide antidumping rate after presuming state control in NME proceedings.
- ATM (Advanced Technology & Materials) initially obtained a separate rate in the investigation, but successive remands and court decisions found ATM failed to rebut the presumption of government control and thus was part of the PRC-wide entity.
- In the first administrative review (2009–2010), Commerce initially assigned ATM a low separate rate (0.15%) but, after the CIT and Federal Circuit decisions about state control, sought remand to reassess ATM’s separate-rate status.
- On remand Commerce concluded ATM did not rebut state control and therefore applied the PRC-wide entity rate; because ATM supplied data, Commerce recalculated the PRC-wide rate as a simple average of the existing PRC-wide rate (164.09%) and ATM’s calculated margin (0.15%), yielding 82.12%.
- The Court of International Trade sustained Commerce’s recalculation and application of the updated PRC-wide rate to ATM; the Federal Circuit affirmed, holding Commerce acted within its authority and that cooperation does not shield an entity that failed to rebut the NME presumption.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce may apply a PRC-wide rate (calculated using AFA) to a cooperating entity that failed to rebut NME presumption | ATM: §1677e(b) bars applying an AFA-based PRC-wide rate to a cooperating party; cooperation entitles ATM to its calculated individual or estimated all-others rate | Government/Commerce: NME presumption treats nonrebutting firms as part of PRC-wide entity; if PRC-wide rate was AFA-based, it still applies to all members who failed to demonstrate independence | Held: Commerce permissibly applied the recalculated PRC-wide rate to ATM; cooperation alone does not prevent application of a PRC-wide AFA rate where the entity failed to rebut state control. |
| Whether Commerce’s use of prior PRC-wide AFA-based rate without full record in the review is supported by substantial evidence | ATM: Lack of investigation-record evidence for 164.09% on the review record makes use of that rate unsupported | Commerce: NME framework contemplates applying an existing PRC-wide rate to entities that do not rebut state control; Commerce also updated the rate using ATM’s data | Held: Substantial evidence supports using the existing PRC-wide rate as the starting point and recalculating it (by averaging) given the record and NME presumption. |
| Whether Commerce’s statement that "no part of the PRC-wide entity failed to cooperate" means full cooperation by entire PRC-wide entity | ATM: That statement implies Commerce found full cooperation and thus could not apply an AFA-based PRC-wide rate | Commerce: Statement only recognized ATM’s cooperation in the review, not cooperation by other PRC-wide members | Held: Court rejects ATM’s reading; context shows statement referred to ATM’s cooperation, not the entire PRC-wide entity. |
| Whether Commerce’s recalculation method (simple average) was unreasonable | ATM: Implied challenge to methodology reducing PRC-wide rate based on ATM data | Neither party challenged the averaging method on appeal; CIT and Fed. Cir. accepted the approach | Held: Court did not review the averaging method’s reasonableness (parties did not challenge it); Commerce’s recalculation was upheld. |
Key Cases Cited
- Sigma Corp. v. United States, 117 F.3d 1401 (Fed. Cir. 1997) (upheld Commerce’s rebuttable presumption of state control in NME proceedings)
- Transcom, Inc. v. United States, 294 F.3d 1371 (Fed. Cir. 2002) (applies NME presumption to sustain application of an entity-wide BIA/AFA rate to nonrebutting producers)
- Changzhou Wujin Fine Chemical Factory Co. v. United States, 701 F.3d 1367 (Fed. Cir. 2012) (describes PRC NME presumption and single state-wide rate practice)
- Michaels Stores, Inc. v. United States, 766 F.3d 1388 (Fed. Cir. 2014) (NME presumption and eligibility for separate rate upon rebuttal)
- Albemarle Corp. v. United States, 821 F.3d 1345 (Fed. Cir. 2016) (distinguishes investigation statutory scheme from administrative reviews and stresses accuracy/currentness of review rates)
- Changzhou Hawd Flooring Co. v. United States, 848 F.3d 1006 (Fed. Cir. 2017) (reaffirms presumption that Chinese exporters are state-controlled absent rebuttal)