Diamond Sawblades Mfrs.' Coal. v. United States, 2019 CIT 157

Commerce selected Bosun Tools Co., Ltd. as a mandatory respondent in the sixth administrative review of the antidumping duty order on diamond sawblades from the PRC.
Bosun sold sawblades produced in both Thailand and the PRC through U.S. affiliates that did not record country of origin for affiliate sales.
To identify country of origin for U.S. sales, Bosun submitted a three-step ‘‘sales identification methodology’’ (product-code matching to purchases, price matches, then a FIFO allocation).
Commerce initially accepted Bosun’s indirect methodology but found verification errors (spot-checked FIFO traces), and the Court remanded for clarification on whether Bosun acted to the “best of its ability.”
On remand Commerce concluded Bosun failed to maintain direct country-of-origin records, its substitute data were unverifiable, and therefore applied facts otherwise available with an adverse inference (AFA), assigning Bosun the PRC-wide rate of 82.05%.
The Court sustained Commerce’s remand redetermination, finding the AFA use supported by substantial evidence and consistent with law.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Commerce properly relied on facts otherwise available because necessary country-of-origin information was missing	Bosun: no necessary information was missing; indirect sales-identification methodology supplied origin data	Commerce/DSMC: Bosun failed to provide direct country-of-origin records, so necessary information was missing	Held: Commerce reasonably found necessary information absent and relied on facts otherwise available
Whether Bosun acted to the "best of its ability" such that Commerce must consider its substitute data under 19 U.S.C. §1677m(e)	Bosun: it acted to best ability; errors were isolated and did not affect margins	Commerce/DSMC: Bosun had the ability to keep origin records and failed to do so; not maximum effort	Held: Court upheld Commerce’s finding Bosun did not act to best of its ability and AFA was permissible
Whether verification errors were too limited to justify rejecting Bosun’s methodology	Bosun: errors affected only a small share of traces and thus methodology should remain usable	Commerce: verification spot-checks showing errors undermine confidence in the methodology and may indicate broader problems	Held: Court accepted Commerce’s view that verification errors made Bosun’s indirect data unverifiable and supported AFA

Peer Bearing Corp. v. United States, 766 F.3d 1396 (Fed. Cir. 2014) (respondent must anticipate information needs and maintain records)
Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) ("best of its ability" requires reasonable steps to maintain and provide requested records)
F. Lii de Cecco di Filippo Fara S. Martino S.p.A. v. United States, 216 F.3d 1027 (Fed. Cir. 2000) (AFA is intended to incentivize cooperation, not to punish)
Consolo v. Federal Maritime Comm’n, 383 U.S. 607 (U.S. 1966) (agency may draw different reasonable conclusions from same evidence)
Nakornthai Strip Mill Pub. Co. v. United States, 587 F. Supp. 2d 1303 (Ct. Int’l Trade 2008) (remand compliance reviewed for adherence to court's order)