Mid Continent Steel & Wire, Inc. v. United States

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
MID CONTINENT STEEL & WIRE, INC.,
Plaintiff-Appellee
v.
UNITED STATES,
Defendant-Appellee
v.
OMAN FASTENERS, LLC,
Defendant-Appellant
______________________
2023-1039
______________________
Appeal from the United States Court of International
Trade in Nos. 1:15-cv-00214-MAB, 1:15-cv-00228-MAB,
Chief Judge Mark A. Barnett.
______________________
Decided: January 7, 2025
______________________
ADAM H. GORDON, The Bristol Group PLLC,
Washington, DC, argued for plaintiff-appellee. Also
represented by BENJAMIN JACOB BAY, JENNIFER MICHELE
SMITH-VELUZ.
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MID CONTINENT STEEL & WIRE, INC. v. US 2
MIKKI COTTET, Commercial Litigation Branch, Civil
Division, United States Department of Justice,
Washington, DC, argued for defendant-appellee. Also
represented by BRIAN M. BOYNTON, PATRICIA M.
MCCARTHY; IAN ANDREW MCINERNEY, Office of the Chief
Counsel Trade Enforcement & Compliance, United States
Department of Commerce, Washington, DC.
MICHAEL PAUL HOUSE, Perkins Coie LLP, Washington,
DC, argued for defendant-appellant. Also represented by
ANDREW CARIDAS, NATHAN K. KELLEY, JONATHAN IRVIN
TIETZ; DAN L. BAGATELL, Hanover, NH; ANDREW
DUFRESNE, Madison, WI; MICHAEL R. HUSTON, Phoenix,
AZ.
______________________
Before MOORE, Chief Judge, SCHALL and TARANTO, Circuit
Judges.
TARANTO, Circuit Judge.
On remand following this court’s decision in Mid
Continent Steel & Wire, Inc. v. United States, 941 F.3d 530
(Fed. Cir. 2019) (Mid Continent 2019), the United States
Department of Commerce relied on the financial statement
of Sundram Fasteners Limited (Sundram) in determining
that Oman Fasteners, LLC was selling its steel nails in the
United States for less than fair value. The Court of
International Trade (Trade Court) sustained Commerce’s
determination, rejecting Oman Fasteners’ challenges to
Commerce’s reliance on Sundram’s financial statement.
On appeal, Oman Fasteners argues, at bottom, that, under
the applicable standard of review, we should set aside
Commerce’s determination because Commerce did not
adequately justify its refusal to rely on two alternative
financial statements—one from Al Jazeera Steel Products
Co. SAOG (Al Jazeera), an Omani manufacturer of steel
bars and pipes; the other from L.S. Industry Co., Ltd. (LSI),
a Thai manufacturer of steel nails, for which the only
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MID CONTINENT STEEL & WIRE, INC. v. US 3
financial statement Oman Fasteners timely submitted was
not fully translated. We reject Oman Fasteners’ arguments
and therefore affirm.
I
In 2014, acting under 19 U.S.C. §§ 1673–1673h,
Commerce initiated an antidumping-duty investigation
into steel nail products from Oman and several other
countries. Certain Steel Nails from India, the Republic of
Korea, Malaysia, the Sultanate of Oman, Taiwan, the
Republic of Turkey, and the Socialist Republic of Vietnam:
Initiation of Less-Than-Fair-Value-Investigations, 79 Fed.
Reg. 36019 (June 25, 2014); see Mid Continent 2019, 941
F.3d at 534. This court’s 2019 opinion summarizes the
statutory background and much of the procedural history
involving Oman Fasteners, and we do not repeat that
discussion here. Mid Continent 2019, 941 F.3d at 534–37.
In the determination reviewed by this court in Mid
Continent 2019, Commerce relied on the financial
statement of Hitech Fastener Manufacture (Thailand) Co.,
Ltd. (Hitech) for the profit portion of a constructed value
for Oman Fasteners’ relevant products, a crucial part of
Commerce’s calculation of a dumping margin in this matter
and hence of the antidumping duty ultimately imposed on
Oman Fasteners. Id. at 536–37. This court largely rejected
Oman Fasteners’ challenges to Commerce’s determination,
including Oman Fasteners’ argument that (for the profit
component) Commerce should have used the partially
translated LSI financial statement or reopened the record
for submission of the full translation. Id. at 540–43. This
court did agree with Oman Fasteners, however, that the
adopted Hitech profit figures might have been affected by
government subsidies and that Commerce did not
adequately address that issue. Id. at 543–45. We therefore
ordered a remand for Commerce to “consider the effect of
[Hitech’s] subsidies on whether the information it selected
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MID CONTINENT STEEL & WIRE, INC. v. US 4
was accurate for the relevant statutory purpose.” Id. at
534.
On remand, Commerce initially stood by its reliance on
the financial statement of Hitech, J.A. 3460, but the Trade
Court required Commerce to address more fully why
Hitech could serve as a reliable surrogate in light of its
receipt of subsidies. Mid Continent Steel & Wire, Inc. v.
United States, 551 F. Supp. 3d 1360, 1366–67 (Ct. Int’l
Trade 2021). On such further consideration, Commerce
chose no longer to rely on the financial statement of Hitech,
but instead to rely on that of Sundram, an Indian producer
of high-tensile fasteners and auto components. J.A. 26, 32–
33. First, Commerce reasoned that because the six Omani
companies whose financial statements were on the record
(including Al Jazeera) did not produce comparable
merchandise, J.A. 28–29, and because the partially
translated financial statements of other companies on the
record (including that of LSI) were “not complete,” J.A. 29,
it would rely on “either Hitech or Sundram, even though
both companies received some form of a subsidy,” J.A. 31.
Then, noting that Hitech’s financial statement was not
contemporaneous with the period of investigation, but
Sundram’s was, Commerce decided to rely on Sundram.
J.A. 33–34. The Trade Court sustained Commerce’s
redetermination, which adopted a 4.22% dumping margin.
Mid Continent Steel & Wire, Inc. v. United States, 586 F.
Supp. 3d 1349, 1352–53 (Ct. Int’l Trade 2022).
Oman Fasteners timely appealed to this court. We
have jurisdiction under 28 U.S.C. § 1295(a)(5).
II
“We review Commerce’s decision using the same
standard of review applied by the Trade Court, while
carefully considering that court’s analysis. We decide legal
issues de novo and uphold factual determinations if they
are supported by substantial evidence.” Mid Continent
2019, 941 F.3d at 537 (citations omitted). “Commerce must
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MID CONTINENT STEEL & WIRE, INC. v. US 5
provide an explanation that is adequate to enable the court
to determine whether its choices are actually reasonable
. . . . We insist that Commerce examine the record and
articulate a satisfactory explanation for its action. . . . [W]e
uphold a decision of less than ideal clarity if the agency’s
path may reasonably be discerned . . . .” Id. (citations and
internal quotation marks omitted).
A
Oman Fasteners argues that Commerce’s selection of
Sundram was unreasonable because it did not adequately
explain its choice of Sundram over Al Jazeera. Oman
Fasteners’ Opening Br. at 36–56. We disagree. Commerce
provided a discernible and adequate explanation.
Commerce explained why Sundram’s products
(fasteners) were more comparable to Oman Fasteners’
products (nails) than were those of Al Jazeera (neither
nails nor fasteners). It noted that “none of the six Omani
companies on the record”—including Al Jazeera—
“produced merchandise comparable to steel nails or in the
same general category as steel nails.” J.A. 26–27; see J.A.
27 (“none of the Omani [financial statements] on the record
indicated that those Omani companies produced steel nails
or any merchandise comparable to steel nails”). Commerce
elaborated:
None [of the Omani companies] produce identical
merchandise (i.e., steel nails) and none produce
comparable merchandise (i.e., fasteners). All six
Omani [financial statements] represent companies
involved in production of dissimilar merchandise
outside of the steel nails general category of
merchandise. Therefore, all six Omani [companies]
likely do not share similarities to Oman Fasteners
in their respective production experiences or raw
material consumptions and are not subject to the
same supply and demand conditions in the global
marketplace as Oman Fasteners. Accordingly,
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MID CONTINENT STEEL & WIRE, INC. v. US 6
these six [financial statements] are less ideal
sources . . . vis-à-vis companies which produce and
sell subject merchandise.
J.A. 37. As Commerce explained, “Sundram produces high
tensile fasteners,” which Commerce found comparable to
steel nails. J.A. 32. Although Sundram’s fasteners have
different end uses from those of Oman Fasteners, J.A.
3405–06, it was reasonable for Commerce to select
Sundram, which produces fasteners, over Al Jazeera,
which does not. Because Sundram’s financial statements
were “the only contemporaneous [financial statements] on
the record reflecting production, sale, and profit from the
sale of comparable merchandise,” J.A. 34, and “data
reflecting the production and profit from sale of comparable
merchandise are always preferable to a profit experience
wholly dissimilar to the mandatory respondent,” J.A. 39,
Commerce’s reliance on Sundram rather than Al Jazeera
was reasonable.
Oman Fasteners suggests that Sundram’s receipt of a
subsidy (found by Commerce) undercuts its reasonableness
as a comparator and that Commerce erred by not explicitly
discussing the potential effects of that subsidy. Oman
Fasteners’ Opening Br. at 36–37, 41–45. But Commerce
did note the size of the subsidy: 30 lakhs for the period of
investigation. J.A. 30–31; see J.A. 3806 (explaining that 30
lakhs is equivalent to roughly $48,663). That figure, the
only one before us, is tiny relative to Sundram’s total
revenue for the period of investigation (about $336 million).
J.A. 3806. The insignificance of the subsidy to any profit
calculation means that, even if it was unreasonable for
Commerce not to address the subsidy more than it did, that
error was harmless: It could not have affected the choice of
Sundram over Al Jazeera. See, e.g., SolarWorld Americas,
Inc. v. United States, 962 F.3d 1351, 1359 n.2 (Fed. Cir.
2020) (explaining that harmless-error review applies to
Commerce’s determinations in the antidumping context);
Al Ghurair Iron & Steel LLC v. United States, 65 F.4th
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MID CONTINENT STEEL & WIRE, INC. v. US 7
1351, 1363 (Fed. Cir. 2023) (concluding that Commerce’s
harmless error “does not require reversal or correction on
remand”). Accordingly, we see no reversible error in
Commerce’s selection of Sundram over Al Jazeera.
B
Oman Fasteners argues that Commerce should have
relied on the partially translated LSI financial statement
or reopened the record to accept the fully translated LSI
financial statement. Oman Fasteners’ Opening Br. at 44–
45, 49–51, 56–61. We previously rejected these challenges
in Mid Continent 2019, and we see no reason to take a
different view here. 941 F.3d at 540–42.
Oman Fasteners submitted the partially translated
LSI financial statement in violation of Commerce’s
regulations, which require approval before submission of
partial translations. 19 C.F.R. § 351.303(e). Similarly,
Oman Fasteners submitted the fully translated LSI
financial statement after Commerce’s deadline for
submission of evidence. Mid Continent 2019, 941 F.3d at
541. Oman Fasteners, not Commerce, is to blame for both
those failures, and we have not been shown that Commerce
had to treat those failures as excusable, whether as
resulting from good faith efforts to meet a deadline for
providing a full translation or otherwise. Id. at 540–42; see
QVD Food Co. v. United States, 658 F.3d 1318, 1324 (Fed.
Cir. 2011) (“[T]he burden of creating an adequate record
lies with [interested parties] and not with Commerce.”
(second alteration in original)). Whether to accept the
partial translation or reopen the record are within
Commerce’s discretion, which it did not abuse here. Mid
Continent 2019, 941 F.3d at 540–42. No issue under 19
U.S.C. § 1677e is presented here. Given the circumstances,
including the presence in the record of other relevant
financial statements, including that of Sundram, it was
reasonable for Commerce to rely on those statements
rather than use a partial translation or reopen the record.
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III
For the foregoing reasons, we affirm the Trade Court’s
judgment.
AFFIRMED
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