Essar Steel Ltd. v. United States
2012 U.S. App. LEXIS 8621
| Fed. Cir. | 2012Background
- Commerce initiated a 2007 countervailing duty investigation into Essar's iron ore products from India, covering January 1, 2007–December 31, 2007.
- Investigated programs included NMDC iron ore purchases, SEZ Act benefits, and Chhattisgarh CIP subsidies.
- Commerce found NMDC purchases countervailable and used tiered benchmarks (Brazilian lumps, Hamersley fines) with freight/import costs added.
- Commerce applied adverse facts due to India's SEZ Act cooperation issues and Essar's inconsistent responses about facilities in Chhattisgarh.
- On CIP, Essar initially denied having any Chhattisgarh facility; later record evidence suggested a facility existed, leading to a remand and consideration of new documents.
- Trial court remanded for CIP re-evaluation; on remand Commerce considered two Essar/Chhattisgarh documents but Essar did not timely submit them; Commerce upheld CIP findings post-remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| NMDC benchmark validity for Lumps and Fines | Essar disputes NMDC benchmark choices and seeks NMDC Japanese sale as tier 1. | Court properly applied tiered benchmarks per 19 C.F.R. § 351.511; NMDC Japanese sale not tier 1 due to non-public auction. | Benchmarks upheld; Hamersley fines used as tier 2 where no tier 1 existed. |
| SEZ Act subsidies timing and product tying | Benefits tied only to post-date production; subject merchandise produced before eligibility date. | No tying evidence; subsidies properly attributed to all Essar exports under SEZ Act. | SEZ subsidies sustained; tying not required per record. |
| CIP adverse facts application validity | Court remand was improper; adverse facts should not have been applied to CIP. | Essar failed to cooperate; adverse facts appropriate and within agency power. | Adverse facts upheld; court affirmed Commerce's CIP outcome on remand. |
| Court remand authority to reopen record | Remand to admit documents was within trial court’s discretion to ensure complete record. | Remand and record reopening improper; would undermine finality and agency autonomy. | Remand to reopen record reversed; appellate court held trial court abused authority. |
| Overall CIP merit after record constraints | CIP benefits should be considered based on full administrative record including submitted documents. | Timeliness and finality require not reopening the record; adverse facts properly applied. | CIP determination reversed due to remand error; NMDC and SEZ upheld. |
Key Cases Cited
- Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) (best-of-its-ability standard for cooperation in investigations)
- Borlem S.A.-Empreedimentos Industriais v. United States, 913 F.2d 933 (Fed. Cir. 1990) (record supplementation limits; fraud exceptions)
- Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc., 435 U.S. 519 (U.S. 1978) (finality and record-closure principles in agency review)
- Rhône Poulenc, Inc. v. United States, 880 F.2d 401 (Fed. Cir. 1989) (agency remand and supplementation authority)
- Co-Steel Raritan, Inc. v. International Trade Commission, 357 F.3d 1294 (Fed. Cir. 2004) (finality and agency record standards)
- Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) (non-timely information and adverse facts framework)
- KYD, Inc. v. United States, 607 F.3d 760 (Fed. Cir. 2010) (adverse facts and proportionality to deter non-compliance)
- QVD Food Co. v. United States, 658 F.3d 1318 (Fed. Cir. 2011) (timeliness of information in administrative record)
- Home Prods. Int'l, Inc. v. United States, 633 F.3d 1369 (Fed. Cir. 2011) (remand supplementation exceptions)