2023 CIT 53
Ct. Int'l Trade2023Background
- Commerce completed the 2019–2020 administrative review of xanthan gum from the PRC and issued Final Results assigning Meihua an adverse facts available (AFA) rate and assigning separate-rate respondents (including Deosen and Jianlong) a 77.04% rate (simple average of Meihua’s 154.07% AFA rate and Fufeng’s 0% rate).
- Meihua challenged Commerce’s use of facts otherwise available and an adverse inference, arguing it timely provided requested duty/entry information and had no prior notice of any deficiency.
- Jianlong and Deosen challenged Commerce’s separate-rate calculation; Deosen also contended one Deosen affiliate had no shipments and that Commerce improperly refused to rescind its review and failed to perform a collapsing analysis.
- Commerce relied on Meihua’s alleged misreporting of entered values and duties to apply AFA, and continued to treat two Deosen entities as a collapsed entity based on the earlier investigation.
- The Court found Commerce failed to notify Meihua of any deficiency or provide an opportunity to cure under 19 U.S.C. § 1677m(d), did not perform a collapsing analysis for Deosen for the period of review, and remanded the Final Results for further consideration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1. Lawfulness of Commerce’s use of facts otherwise available/AFA to Meihua | Meihua: provided requested duty/entry info, had no notice to cure; AFA and full alternative AFA not justified | Defendant: Meihua withheld/failed to disclose corrections and impeded the proceeding, justifying AFA | Court: Remanded — Commerce failed to satisfy §1677m(d) notice/cure requirement, so AFA application cannot stand without further procedure |
| 2. Whether Jianlong exhausted administrative remedies | Jianlong: merits challenge to separate-rate calculation | Defendant: Jianlong failed to exhaust because it did not file an administrative case brief | Court: Allowed Jianlong to proceed — exhaustion exception applies because Deosen raised identical administrative argument |
| 3. Lawfulness of Commerce’s separate-rate (77.04%) to non-selected respondents | Jianlong/Deosen: simple average is not reasonably reflective of non-investigated respondents’ dumping | Defendant: Rate is reasonable under Commerce’s expected-method framework and statutory scheme | Court: Did not decide on the merits — remanded separate-rate calculation for Commerce to reconsider after correcting Meihua’s rate on remand |
| 4. Whether Commerce properly refused to rescind review for Deosen Biochemical Ltd. | Deosen: one affiliate had no shipments and timely submitted no-shipment certification; Commerce should have rescinded for that affiliate | Defendant: Proper to treat the two Deosen entities as collapsed based on prior investigation | Court: Remanded — Commerce abused discretion by not performing a collapsing analysis for the period of review and rejecting the no-shipment certification; ordered Commerce to reexamine collapse and rescission issues |
Key Cases Cited
- Mueller Comercial de Mexico v. United States, 753 F.3d 1227 (Fed. Cir. 2014) (distinguishing §1677e(a)(1) and (a)(2) and purposes of facts-available provisions)
- Zhejiang DunAn Hetian Metal Co. v. United States, 652 F.3d 1333 (Fed. Cir. 2011) (background on facts-available use)
- Nippon Steel Corp. v. United States, 337 F.3d 1373 (Fed. Cir. 2003) (best‑of‑its‑ability standard for adverse inferences)
- Ta Chen Stainless Steel Pipe, Inc. v. United States, 298 F.3d 1330 (Fed. Cir. 2002) (record-keeping and reasonableness expectations)
- Maverick Tube Corp. v. United States, 857 F.3d 1353 (Fed. Cir. 2017) (Commerce must issue supplemental questionnaires to satisfy §1677m(d))
- NSK Ltd. v. United States, 481 F.3d 1355 (Fed. Cir. 2007) (procedural requirements for Commerce when responses are deficient)
- Hitachi Energy USA Inc. v. United States, 34 F.4th 1375 (Fed. Cir. 2022) (Commerce’s denial of an opportunity to cure contradicts statute)
- Yangzhou Bestpak Gifts & Crafts Co. v. United States, 716 F.3d 1370 (Fed. Cir. 2013) (strict view of exhaustion of administrative remedies)
- Holmes Prods. Corp. v. United States, 16 C.I.T. 1101 (CIT 1992) (exceptions to exhaustion where agency had opportunity to consider issue)