Guangdong Dongyuan Kitchenware Industrial Co., Ltd. v. United States, 1:13-cv-00199

Background

Commerce investigated antidumping duties on drawn stainless steel sinks from China (POI: July–Dec 2011); Dongyuan and Superte/Zhaoshun were mandatory respondents; Elkay was petitioner.
In the Final Determination Commerce assigned weighted-average dumping margins (Dongyuan 27.14%, Superte/Zhaoshun 39.87%, separate rate average 33.51%) using Thai GTA import data to value cold-rolled stainless steel coil and surrogate financial statements from Thai firms to calculate SG&A/interest ratios.
The court (Elkay I) remanded, directing Commerce to reconsider the SG&A treatment and allowing a voluntary remand to gather additional surrogate import data to test whether the Thai data were aberrational.
On remand Commerce (1) retained the Thai-derived $3.80/kg surrogate value for steel coil after adding GTA import data from other comparable countries and comparing AUVs, and (2) recalculated SG&A/interest ratios by removing the prior adjustment intended to avoid "double-counting" SG&A labor (i.e., it used full reported SG&A expense in the ratios).
Dongyuan challenged Commerce’s surrogate-value choice for steel coil and continued to argue that Commerce’s remand SG&A methodology resulted in double counting; Elkay supported the remand results.
The Court affirmed Commerce’s Remand Redetermination, finding the Thai data were the best available information and that Commerce permissibly adjusted its SG&A methodology and properly exercised discretion not to reopen the record for alternative labor data.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Surrogate value for cold-rolled stainless steel coil	Dongyuan: Thai GTA data are aberrational, distorted by dumped/subsidized imports and customs manipulation; alternative country data (Philippines/Indonesia) are better	Commerce: Thai 11-digit data are more specific to the grade Dongyuan used; after excluding distorted imports, Thai AUVs are within the range of other countries and based on large quantities	Court: AFFIRMED — Commerce reasonably chose Thai data as best available information; variations not aberrational and specificity justified selection
Quantity basis and significance of Thai subset used	Dongyuan: the $3.80/kg was derived from a very small quantity and therefore not representative	Commerce: the 11-digit Thai subheadings were the only record data specific to Dongyuan’s grade (304 austenitic); quantity was not commercially insignificant	Court: AFFIRMED — Commerce reasonably preferred specificity over broader but less specific six-digit data
SG&A labor "double-counting" adjustment	Elkay (and Commerce on remand): prior adjustment was erroneous; SG&A labor should be treated as part of reported SG&A expenses in financial ratios. Dongyuan: remand method double-counts SG&A labor because the NSO labor rate already includes non-production labor	Commerce: NSO rate covers manufacturing labor but does not capture unreported SG&A labor; surrogate financials separately report SG&A labor and methodology should mirror surrogate companies' accounting	Court: AFFIRMED — record supports Commerce’s conclusion that NSO rate did not capture SG&A labor and removal of the downward adjustment corrected the prior error
Reopening the record to change labor data source	Dongyuan: if double-counting cannot be adjusted, Commerce must adopt a different labor data source (e.g., ILO Chapter 5B) and reopen the record	Commerce: ILO 5B data not on the record; Commerce has discretion whether to reopen and reasonably relied on NSO data as best available	Court: AFFIRMED — Commerce acted within discretion not to reopen; NSO selection is supported by substantial evidence

Key Cases Cited

Consol. Edison Co. v. NLRB, 305 U.S. 197 (agency factual findings are upheld if supported by evidence a reasonable mind might accept)
Elkay Mfg. Co. v. United States, 34 F. Supp. 3d 1369 (Ct. Int’l Trade 2014) (prior opinion remanding for reconsideration of SG&A treatment and surrogate data)
Essar Steel Ltd. v. United States, 678 F.3d 1268 (Fed. Cir. 2012) (agency’s discretion to reopen record following remand)