2018 CIT 51
Ct. Int'l Trade2018Background
- Commerce investigated countervailing duties on certain corrosion-resistant steel from India for POI = 2014; JSW was a mandatory respondent.
- Commerce requested information about affiliates that supply inputs "primarily dedicated" to subject merchandise; JSW listed 55 affiliates and initially reported that affiliate Salav was "not in operation" during the POI.
- At on-site verification, JSW corrected the record, stating Salav was operational for the last two months of the POI and produced direct reduced iron (DRI), but that Salav’s DRI went only to Dolvi (which did not produce subject merchandise) and thus did not supply inputs to CORE during the POI.
- Commerce declined to verify the belated Salav information, found JSW withheld requested information and impeded the investigation, applied facts available and adverse facts available (AFA), and raised JSW’s CVD rate from 2.85% (prelim) to 29.46% (final).
- JSW challenged Commerce’s use of facts available/AFA; the Court reviewed whether Commerce had substantial evidence that JSW withheld requested information under 19 U.S.C. § 1677e(a).
- The Court remanded, holding Commerce lacked substantial record evidence that JSW withheld requested information about Salav and thus could not rely on facts available or AFA; Commerce must recalculate JSW’s rate excluding Salav.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce properly applied facts available under §1677e(a) for JSW’s alleged withholding of information about Salav | JSW: Salav did not supply an input to CORE or to a relevant downstream input during the POI, so Commerce did not request information about Salav and JSW did not withhold it | U.S.: Commerce’s questionnaires were broad; JSW should have reported Salav even if its inputs were not used in the POI | Held: Commerce failed to point to record evidence showing requested info was withheld; facts available were not supported by substantial evidence |
| Whether Commerce permissibly used AFA under §1677e(b) based on failure to cooperate | JSW: No withholding of requested info; thus AFA inappropriate | U.S.: JSW’s untimely correction and refusal to verify justify AFA | Held: Court did not reach §1677e(b) because threshold §1677e(a) finding failed |
| Whether Commerce’s refusal to verify justifies drawing adverse inferences | JSW: Refusal to verify cannot substitute for record evidence of withholding | U.S.: Refusal to verify supports skepticism of JSW’s belated assertions | Held: Verification refusal alone is not substantial evidence to support withholding or AFA |
| Scope of questionnaire obligations regarding affiliates and POI limits | JSW: Questionnaire requests focused on affiliates supplying inputs during POI; reporting limited accordingly | U.S.: Commerce may require information about affiliates even if inputs not used in POI | Held: Record shows Commerce accepted non-operation claims earlier; Commerce cannot now treat POI limits as irrelevant without record support |
Key Cases Cited
- Olympic Adhesives, Inc. v. United States, 899 F.2d 1565 (Fed. Cir. 1990) (agency must put forth record evidence to show responses were incomplete)
- Ansaldo Componenti, S.p.A. v. United States, 628 F. Supp. 198 (Ct. Int’l Trade 1986) (respondent must answer Commerce’s requests; scope of information requested matters)
- Ozdemir Boru San. v. Tic. Ltd. Sti., 273 F. Supp. 3d 1225 (Ct. Int’l Trade 2017) (sustaining AFA where verification produced record evidence contradicting respondent’s answers)