Mid Continent Steel & Wire, Inc. v. United States, 1:15-cv-00213

Commerce conducted an antidumping duty (ADD) investigation of certain steel nails from Taiwan; PT Enterprise was a mandatory respondent and Pro-Team Coil Nail Enterprise (an affiliate) had a separate steam business.
The Final Results used constructed value (CV) for normal value and calculated a G&A expense ratio using company-wide financial data.
The court previously remanded because Commerce did not adequately explain how it allocated steam-related costs between COGS (denominator) and G&A (numerator), creating an apparent inconsistency.
On remand, Commerce explained it allocates costs on a company-wide basis by reference to the company’s audited books: production-related costs go to COGS; non-production (period) costs go to G&A, regardless of whether costs relate to subject or non-subject products.
Commerce reconsidered treatment of a subsidy tied to Pro-Team’s steam business and reclassified the subsidy income as non-operating other income (an offset to G&A) rather than an offset to COGS, lowering PT’s margin and the ‘‘all others’’ rate.
The court sustained Commerce’s Remand Results, finding the explanations supported by substantial evidence and within Commerce’s discretion.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Commerce adequately explained allocation of steam-related costs between G&A and COGS	Mid Continent: Commerce failed to explain how some steam costs were placed in G&A when it claimed to allocate steam costs to COGS	Commerce: It allocates company-wide costs by how items are classified in audited books; production costs -> COGS, non-production period costs -> G&A	Court: Sustained Commerce—remand explanation adequately shows allocation by accounting classification and company-wide methodology
Whether Commerce properly allocated steam-related subsidy income as an offset to G&A rather than to COGS	Mid Continent: Subsidy purpose was to reduce steam production costs so it should offset COGS; record does not support reallocation	Commerce: Audited financials and revised worksheets record the subsidy as non-operating other income, not an offset to COGS; Commerce relies on books kept in accordance with GAAP	Court: Sustained Commerce—substantial evidence supports treating subsidy as offset to G&A given Pro‑Team’s financial statements

Fujitsu Gen. Ltd. v. United States, 88 F.3d 1034 (Fed. Cir.) (Commerce entitled to deference on technical economic/accounting decisions)
Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983) (agency must cogently explain discretionary choices)
Torrington Co. v. United States, 146 F. Supp. 2d 845 (2001) (G&A expenses generally relate to company-wide activities rather than production-specific costs)