Maverick Tube Corporation v. United States
2017 U.S. App. LEXIS 9336
| Fed. Cir. | 2017Background
- Commerce investigated countervailing subsidies on oil country tubular goods (OCTG) from Turkey; Borusan and the Government of Turkey (GOT) were mandatory respondents.
- Commerce requested reporting of all hot-rolled steel (HRS) purchases during the period of investigation (POI); Borusan reported only Gemlik mill data and omitted Halkali and Izmit mill purchases.
- Borusan claimed producing the omitted data was burdensome, said Gemlik data captured any relevant subsidies, and indicated willingness to supply full data if Commerce insisted, but never stated it was unable to provide the omitted data or proposed an alternative format.
- Commerce applied adverse facts available (AFA) to Borusan for failing to provide Halkali/Izmit data; the Trade Court remanded for further justification, Commerce reaffirmed AFA on remand, and the Trade Court sustained Commerce’s AFA application.
- For GOT, Commerce initially found the Turkish HRS market distorted because Erdemir (a government-controlled producer) accounted for a substantial portion of domestic production; the Trade Court vacated that distortion finding and remanded. On remand Commerce found no convincing evidence of market distortion and declined to apply AFA to GOT; the Trade Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce properly applied AFA to Borusan for not reporting Halkali and Izmit HRS purchases | Borusan: it cooperated to the best of its ability, explained burdens, and §1677m(c) required Commerce to modify requests or allow time to comply | Maverick/U.S.: Borusan never said it was unable to provide data, failed to correct deficiency after supplemental questionnaire, so did not act to best of ability | AFA to Borusan upheld: substantial evidence supports that Borusan had the information, did not provide it, and did not trigger §1677m(c) or §1677m(d) protections |
| Whether Commerce’s initial finding that Turkish HRS market was distorted was supported by substantial evidence; and whether Commerce erred by not applying AFA to GOT | Maverick: record shows Erdemir produced majority of domestic HRS and domestic production was majority of supply, so distortion finding was supported; GOT failed to cooperate so AFA should apply | Borusan/GOT: record did not show majority control or indicia of distortion; GOT timely responded and claimed lack of HRS-specific data or confidentiality constraints for some documents | Court: Commerce’s original distortion finding lacked adequate support (no evidence of the “certain circumstances” showing distortion where only a substantial portion, not a proven majority, was controlled). On remand Commerce’s decision that market was not distorted and refusal to apply AFA to GOT is supported by substantial evidence |
Key Cases Cited
- Consol. Edison Co. of N.Y. v. NLRB, 305 U.S. 197 (Court explains substantial-evidence standard)
- Nan Ya Plastics Corp. v. United States, 810 F.3d 1333 (Fed. Cir. 2016) (discusses burdens in Commerce proceedings)
- Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) (defines “best of its ability” standard)
- Essar Steel Ltd. v. United States, 678 F.3d 1268 (Fed. Cir. 2012) (importance of AFA given Commerce’s lack of subpoena power)
- F.lli De Cecco Di Filippo Fara S. Martino S.p.A. v. United States, 216 F.3d 1027 (Fed. Cir. 2000) (purpose of adverse facts statute to incentivize cooperation)