Hyundai Heavy Indus., Co. v. United States
332 F. Supp. 3d 1331
Ct. Intl. Trade2018Background
- Commerce conducted the third administrative review (AR 3) of the antidumping order on large power transformers (Aug 1, 2014–July 31, 2015), selected HHI as a mandatory respondent, issued questionnaires and supplemental questionnaires, and published Preliminary Results relying on HHI data (3.09% margin) and Final Results assigning HHI a 60.81% margin based on total adverse facts available (AFA).
- Commerce cited four bases for resort to total AFA: (1) HHI failed to report service-related revenues separately; (2) HHI excluded a subject part from certain home-market gross unit prices; (3) HHI failed to separately report prices/costs for accessories; and (4) HHI selectively provided documents and had data discrepancies.
- HHI argued Commerce changed its practice regarding service-related revenue without adequate notice, that its worksheet and case‑brief submissions provided necessary data, and that Commerce failed to notify or allow remediation for alleged deficiencies on accessories and selective reporting.
- Commerce defended that each administrative review is a distinct record, that AR 3 record evidence showed separately‑negotiable service line items and misreporting of a part, and that HHI impeded the review by not reporting in the requested form/timely manner.
- The Court reviewed whether Commerce’s individual findings were supported by substantial evidence and whether resort to total AFA complied with 19 U.S.C. §§ 1677e, 1677m and applicable precedent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1) Service-related revenue: did HHI fail to report separately and justify AFA? | HHI: Commerce departed from prior practice and gave insufficient notice; HHI's worksheet/case brief supplied needed data. | Commerce: AR 3 record showed separate invoice line items indicating negotiable services; HHI failed to report as requested and impeded the review. | Held: Substantial evidence supports Commerce’s finding HHI had separable service revenues and failed to timely report; adverse inference permissible. |
| 2) Excluded "part": did HHI misreport a subject part in home-market prices warranting AFA? | HHI: The revised worksheet and record enabled calculation; Commerce should have used that information. | Commerce: HHI misreported the part as non‑subject in home market but included it in U.S. sales; HHI failed to act to best of its ability. | Held: Substantial evidence supports that the part was subject merchandise and HHI failed to report it properly; adverse inference permissible. |
| 3) Accessories: did HHI withhold specifically requested information about accessories? | HHI: "Accessories" was undefined by Commerce; HHI reasonably treated parts as subject merchandise and sought no clarification. | Commerce/ABB: HHI had burden to explain its commercial practice; record references use the term. | Held: Commerce’s conclusion that HHI withheld the requested information on accessories is not supported by substantial evidence; remand required on this point. |
| 4) Selective reporting and discrepancies: did HHI selectively provide documents and create unresolvable discrepancies? | HHI: Commerce’s finding lacks specific examples and was procedurally unfair given late requests; record does not show deliberate withholding. | Commerce/ABB: HHI failed to provide complete invoices and accurate data despite requests; noncooperation supports AFA. | Held: Commerce’s statements about selective reporting and discrepancies are conclusory and lack record citations; not supported by substantial evidence and must be remanded. |
Key Cases Cited
- Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) (defines "best of its ability" standard and use of adverse inferences under 19 U.S.C. § 1677e).
- Zhejiang DunAn Hetian Metal Co. v. United States, 652 F.3d 1333 (Fed. Cir. 2011) (total AFA appropriate where submitted data have pervasive, persistent deficiencies).
- Ta Chen Stainless Steel Pipe, Inc. v. United States, 298 F.3d 1330 (Fed. Cir. 2002) (burden of production is on the party in possession of requested information).
- Jiaxing Bro. Fastener Co. v. United States, 822 F.3d 1289 (Fed. Cir. 2016) (each administrative review is a separate proceeding and based on its own record).
- NMB Singapore Ltd. v. United States, 557 F.3d 1316 (Fed. Cir. 2009) (agency must explain its decisions sufficiently to be reasonably discernable to a reviewing court).