Xi'an Metals & Minerals Import & Export Co. v. United States
256 F. Supp. 3d 1346
Ct. Intl. Trade2017Background
- Administrative review (AR5) of antidumping duty order on certain steel nails from the PRC covering Aug 1, 2012–July 31, 2013; Commerce (ITA) selected Xi'an Metals and Stanley as mandatory respondents and issued final results raising margins for Stanley and Xi'an.
- ITA selected Thailand as the primary surrogate country and used Thai surrogate values (SWR etc.); Xi'an contended Thai import data were tainted and proposed Philippines or Ukraine as better surrogates.
- Xi'an raised challenges to surrogate-country selection, valuation of brokerage/handling and freight (including the weight denominator), and alleged double-counting of SG&A labor in the surrogate labor rate.
- Stanley (consolidated plaintiffs) alleged a ministerial transcription error in their post‑verification FOP database that materially increased their margin, and separately challenged ITA’s differential‑pricing/targeted‑dumping methodology (use of Cohen’s d, ratio test, meaningful‑difference test, and application of A‑T to all sales).
- ITA applied its differential‑pricing analysis, used Cohen’s d to find significant price differences, concluded a meaningful difference existed, and applied the A‑to‑transaction (A‑T) method (with zeroing) to all Stanley sales; ITA declined to correct Stanley’s alleged transcription ministerial error.
- Court review limited to whether ITA’s determinations were supported by substantial evidence and in accordance with law; court ordered limited remand for three discrete matters and upheld most of ITA’s differential‑pricing approach.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Suitability of Thailand as primary surrogate (Xi'an) | Thai import values are manipulated and Thai SWR prices are aberrant; Philippines or Ukraine are superior surrogates | Record evidence does not show Thai SWR data are aberrational; benchmarks offered by Xi'an are unreliable or inapposite | Court found substantial evidence supports ITA's Thailand selection; declined to substitute its judgment for Commerce |
| Effect of Thailand political instability (Xi'an) | Military coup and unrest should trigger "reason to believe or suspect" distortion of Thai data | Xi'an offered no record evidence showing the coup affected the specific SV data or ITA criteria | Court held ITA reasonably concluded coup evidence did not establish unreliability of SV data |
| B&H/inland freight denominator (Xi'an) | Doing Business report denominator (10,000 kg) is inappropriate; ITA should use container maximum or Xi'an's average load | Xi'an failed to raise this argument at Commerce (exhaustion); surrogate data must come from surrogate country; Doing Business denominator is supported by record | Court dismissed claim for lack of exhaustion and declined relief |
| Double‑counting of labor in surrogate financial ratios (Xi'an) | Thai NSO labor rate includes benefits and nonproduction labor; Commerce should adjust SG&A ratios to avoid double‑counting | ITA relied on surrogate company classifications and Labor Methodologies; respondents did not report SG&A hours so SG&A labor belongs in ratios | Court remanded: ITA must address double‑counting, and if it keeps a labor source that includes all labor/benefits, it must adjust financial‑ratio denominators to avoid double‑counting |
| Ministerial transcription error in Stanley FOP database (Stanley) | Omitted zero in V_DLCROD field materially overstated low‑carbon SWR FOP and increased dumping margin; ITA should correct as ministerial error | ITA limits ministerial corrections to its own errors and will correct respondent errors only when "so egregious and so obvious"; it deemed this not ministerial | Court ordered remand: the transcription error was obvious and remand requires ITA to correct it |
| Differential‑pricing / targeted‑dumping methodology (Stanley) | Cohen's d and ITA's tests are inappropriate, biased, mechanistic; A‑T applied to all sales violates limiting rule; statute requires statistical significance | ITA's Cohen's d, ratio, and meaningful‑difference tests are reasonable gap‑filling exercises; statistical significance unnecessary because ITA analyzes full population; ITA found >66% passing and a meaningful difference | Court upheld ITA's differential‑pricing framework and its use of Cohen's d and related tests generally, but remanded because ITA applied A‑T to all sales in contravention of the regulation's "limited to sales that constitute targeted dumping" limiting rule |
Key Cases Cited
- Consol. Edison Co. v. NLRB, 305 U.S. 197 (agency findings are supported if a reasonable mind could accept the evidence)
- Consolo v. Fed. Mar. Comm'n, 383 U.S. 607 (courts should not substitute their judgment for reasonable agency determinations)
- Matsushita Elec. Indus. Co. v. United States, 750 F.2d 927 (two inconsistent conclusions from same evidence can still support agency finding)
- NTN Bearing Corp. v. United States, 74 F.3d 1204 (Commerce has duty to determine dumping margins as accurately as possible and correct ministerial errors)
- Mid Continent Nail Corp. v. United States, 846 F.3d 1364 (invalidated Commerce's withdrawal of prior targeted‑dumping regulation — relevant to limits on agency procedure)
- Apex Frozen Foods Private Ltd. v. United States, 862 F.3d 1322 (upholding Commerce's use of alternative method where A‑A could not account for price differences)