DuPont Teijin Films China Ltd. v. United States
2014 CIT 106
| Ct. Intl. Trade | 2014Background
- This is a USCIT Rule 56.2 challenge to Commerce’s Final Results of the 2010–2011 administrative antidumping review of PET film from the PRC. DuPont and Tianjin Wanhua are petitioners/plaintiffs; the United States and two U.S. producers intervened.
- Commerce selected DuPont and Green Packing as mandatory respondents and assigned DuPont’s non‑zero margin to other cooperating respondents (including Wanhua). Final margins: DuPont 12.80%, Green Packing 0.00%.
- DuPont challenged Commerce’s valuation of recycled PET chips (reprocessed by‑product), its indirect selling expense allocation, and Commerce’s brokerage & handling (B&H) surrogate calculation (use of World Bank Doing Business data and allocation per‑shipment vs per‑container). DuPont also adopted Wanhua’s challenge to Commerce’s use of targeted‑dumping analysis in reviews.
- Wanhua argued Commerce erred in not selecting it as a mandatory respondent (arguing the respondent pool wasn’t "large," Commerce mixed CBP and voluntary Q&V data improperly, and DuPont’s rate was unrepresentative) and that assigning DuPont’s rate to Wanhua was unfair.
- The court (Restani, J.) remanded in part (recycled PET chip valuation and B&H calculation) and sustained Commerce in all other respects; any change to DuPont’s margin on remand must be applied to Wanhua.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Valuation of recycled PET chips (by‑product) | DuPont: recycled chips should be valued at zero (or get an offset) to avoid double counting; Commerce’s assignment of virgin surrogate value is arbitrary. | Commerce/US: assigned surrogate value to recycled chips because record didn’t substantiate quantity offset; zero valuation would understate overhead. | Court: Commerce’s approach double‑counts costs and is unreasonable; remand for valuation (zero value or appropriate offset). |
| Brokerage & Handling (surrogate selection and allocation) | DuPont: Commerce should have used more contemporaneous Doing Business 2013 and must separate per‑shipment vs per‑container costs and adjust document costs when exporter internally prepares some documents. | Commerce/US: Doing Business 2011 was most reliable and identifiable; aggregate document costs cannot be disaggregated; Doing Business 2011 yields reasonable surrogate; per‑kg conversion is standard. | Court: Commerce reasonably chose Doing Business 2011 and properly declined to reduce aggregate document line without breakdown; but Commerce’s per‑kg conversion for per‑shipment items (document/customs fees) is unreasonable — remand to recalculate allocation over shipments. |
| Indirect selling expense allocation | DuPont: Commerce improperly rejected DuPont’s methodology that excluded expenses solely tied to non‑subject merchandise; regulation forbids rejection solely because numerator includes non‑subject expenses. | Commerce/US: DuPont failed to demonstrate remaining numerator expenses could be reliably allocated; Commerce’s method (apply subject‑sales ratio to total indirect expenses) is not unreasonably distortive. | Court: DuPont failed to exhaust/raise the specific regulatory argument before Commerce; Commerce’s factual finding that DuPont couldn’t segregate expenses is supported by record — upheld. |
| Use of targeted‑dumping analysis in administrative reviews | Wanhua/DuPont: statutory targeted‑dumping provision appears in the Investigations subsection only; Congress did not authorize targeted analysis in reviews. | Commerce/US: Statute’s Reviews subsection is silent as to prohibiting targeted analysis; Commerce has discretion to apply targeted methodology in reviews (with monthly averaging rules). | Court: Commerce did not exceed its discretion by using targeted‑dumping analysis in a review; challenge rejected. |
| Selection of mandatory respondents and assignment of DuPont rate to Wanhua | Wanhua: Commerce lacked authority to limit respondents because pool wasn’t large; Commerce relied on inconsistent data; DuPont’s rate unrepresentative (possible manipulation and further manufacturing). | Commerce/US: Commerce properly limited respondents as practicable; used CBP and rebuttal Q&V data reasonably; no evidence of manipulation; Wanhua failed to seek voluntary‑respondent status. | Court: Wanhua failed to exhaust administrative remedies (did not request voluntary respondent status); exhaustion doctrine bars relief on respondent selection; assignment of DuPont’s rate to Wanhua sustained absent evidence of manipulation. |
Key Cases Cited
- Rhone Poulenc, 899 F.2d 1185 (Fed. Cir.) (antidumping goal: determine margins accurately)
- Lasko Metal Prods. v. United States, 43 F.3d 1442 (Fed. Cir.) (Commerce duty to use best information to determine margins)
- QVD Food Co. v. United States, 658 F.3d 1318 (Fed. Cir.) (deference to Commerce’s "best available information" determinations)
- Holmes Prods. Corp. v. United States, 795 F. Supp. 1205 (CIT) (double‑counting of inputs must be avoided)
- Mittal Steel Galati S.A. v. United States, 521 F. Supp. 2d 1409 (CIT) (use of offsets/credits for recycled inputs when surrogate valuation otherwise distorts costs)
- E.I. DuPont De Nemours & Co. v. United States, 4 F. Supp. 2d 1248 (CIT) (prior precedent valuing recycled PET at zero and capturing processing costs elsewhere)
- Corus Staal BV v. United States, 502 F.3d 1370 (Fed. Cir.) (exhaustion of administrative remedies and futility standard)