Novolipetsk Steel Public Joint Stock Company et al v. United States

Slip Op. 20-170
UNITED STATES COURT OF INTERNATIONAL TRADE
NOVOLIPETSK STEEL PUBLIC JOINT
STOCK COMPANY and NOVEX
TRADING (SWISS) SA,
Plaintiffs,
v.
UNITED STATES,
Defendant,
and
NUCOR CORPORATION,
Defendant-Intervenor.
Before: Claire R. Kelly, Judge
Court No. 19-00172
PUBLIC VERSION
OPINION AND ORDER
[Sustaining the U.S. Department of Commerce’s final determination in the 2016–
2017 administrative review of the antidumping duty order on certain hot-rolled flat-
rolled carbon-quality steel products from the Russian Federation.]
Dated: November 30, 2020
Valerie Ellis, Curtis, Mallet-Prevost, Colt & Mosle LLP, of Washington, D.C., argued
for plaintiffs Novolipetsk Steel Public Joint Stock Company and NOVEX Trading
(Swiss) SA. 	Also on the briefs were Daniel L. Porter, Tung Nguyen, and Kimberly
Reynolds.
Kelly A. Krystyniak, Trial Attorney, Commercial Litigation Branch, Civil Division,
U.S. Department of Justice, of Washington, D.C., argued for defendant. Also on the
brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson,
Director, and Tara K. Hogan, Assistant Director. Of counsel was Brandon J. Custard,
Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S.
Department of Commerce, of Washington, D.C.
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Cynthia C. Galvez and Christopher B. Weld, Wiley Rein, LLP, of Washington, D.C.,
argued for defendant-intervenor Nucor Corporation. Also on the brief were Alan H.
Price and Jeffrey O. Frank.
Kelly, Judge: Before the court is Plaintiffs Novolipetsk Steel Public Joint Stock
Company (“NLMK”) and NOVEX Trading (Swiss) SA’s (“NOVEX”) Rule 56.2 motion
for summary judgment on the agency record challenging several aspects of the U.S.
Department of Commerce’s (“Commerce”) final determination in its 2016–2017
administrative review of the antidumping duty (“ADD”) order on certain hot-rolled
flat-rolled 	carbon-quality 	steel 	products 	(“HRC”) 	from 	the 	Russian 	Federation
(“Russia”). See [Pls.’] Mot. J. Agency R., Feb. 13, 2020, ECF No. 26; see also [HRC]
from [Russia], 84 Fed. Reg. 38,948, 38,949 (Dep’t Commerce Aug. 8, 2019) (final
results and rescission of [ADD] admin. review; 2016–2017) (“Final Results”) and
accompanying Issues & Decision Memo. for the [Final Results], A-821-809, (Aug. 2,
2019), ECF No. 21-5 (“Final Decision Memo”). 	Plaintiffs challenge Commerce’s
decision to rescind its administrative review of NLMK as both contrary to law and
unsupported by substantial evidence. See Pls.’ Opening Br. Supp. 56.2 Mot. J. Agency
R. Confidential Version, Feb. 13, 2020, ECF No. 26-1 (“Pls.’ Br.”). 	Specifically,
Plaintiffs contest Commerce’s decision to analyze the bona fides of NLMK’s sale of
subject merchandise into the United States, see id. at 5–14, determination that
NLMK’s U.S. sale is not bona fide, see id. at 14–46, and resultant decision to rescind
the administrative review. See id. at 46–52. Plaintiffs also submit that Commerce’s
rescission results in the impermissible application of facts available with an adverse
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inference (“adverse facts available” or “AFA”) 1 to NLMK. 	See id. at 52–55. 	For the
following 	reasons, 	the 	court 	sustains 	Commerce’s 	decision 	to 	rescind 	the
administrative review.
BACKGROUND
On October 15, 1998, Commerce initiated a less-than-fair-value (“LTFV”)
investigation of HRC from Russia. 	See [HRC] from Brazil, Japan, and [Russia], 63
Fed. Reg. 56,607, 56,613 (Dep’t Commerce Oct. 22, 1998) (initiation of [ADD]
investigations) (“Initiation of ADD Investigations”). 	On July 12, 1999, Commerce
entered into a Suspension Agreement with the Ministry of Trade of the Russian
Federation. 2 	See [HRC] from [Russia], 64 Fed. Reg. 38,642, 38,642 (Dep’t of
Commerce July 19, 1999) (suspension of [ADD] investigation). 	However, at the
request 	of 	petitioners, 	Commerce 	continued 	the 	investigation 	and 	made 	an
affirmative final determination of sales at LTFV. See [HRC] from [Russia], 64 Fed.
Reg. 38,626, 38,626–27 (Dep’t Commerce July 19, 1999) (notice of final determination
1 Parties and Commerce sometimes use the shorthand “AFA” or “adverse facts
available” or “AFA” to refer to Commerce’s reliance on facts otherwise available with
an adverse inference to reach a final determination. 	However, AFA encompasses a
two-part inquiry pursuant to which Commerce must first identify why it needs to rely
on facts otherwise available, and second, explain how a party failed to cooperate to
the best of its ability as to warrant the use of an adverse inference when “selecting
among the facts otherwise available.” See 19 U.S.C. § 1677e(a)–(b).
2 Commerce is permitted “to suspend an [ADD] . . . investigation by accepting a
suspension agreement[.]” See 19 C.F.R. § 351.208 (1999).
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of sales at [LTFV]) (“HRC from Russia”). 	Given that Russia was considered a
nonmarket economy at the time, Commerce calculated a country-wide, or Russia-
wide, dumping margin of 184.56 percent based on total AFA. 3 See id., 64 Fed. Reg.
at 38,641. 	Nonetheless, Commerce did not issue an ADD order because of the
Suspension Agreement.
3 In antidumping proceedings, Commerce estimates the “weighted average dumping
margin for each exporter and producer individually investigated” and the “all-others
rate 	for 	all 	exporters 	and 	producers 	not 	individually 	investigated.” 	19 	U.S.C.
§§ 1673b(d)(1)(A), 1673d(c)(1)(B)(i); see also 19 C.F.R. §§ 351.205, 351.210 (2018). The
all-others rate is the “amount equal to the weighted average of the estimated
weighted 	average 	dumping 	margins 	established 	for 	exporters 	and 	producers
individually investigated, excluding any zero and de minimis margins, and any
margins determined entirely under section 1677e of this title” (i.e., based on facts
available). 19 U.S.C. § 1673d(c)(5); see also id. at § 1677e.
In 	proceedings 	involving 	a 	nonmarket 	economy, 	Commerce 	presumes
exporters and producers are under foreign government control with respect to export
activities, 	and 	will 	assign 	a 	single 	“country-wide” 	rate 	unless 	a 	respondent
demonstrates it qualifies for a separate rate. See Yangzhou Bestpak Gifts & Crafts
Co. v. United States, 716 F.3d 1370, 1373 (Fed. Cir. 2013) (“Yangzhou”) (citing Sigma
Corp. v. United States, 117 F.3d 1401, 1405 (Fed. Cir. 1997)); see also 19 C.F.R.
§ 351.107(d) (1999).
Here, Commerce selected Novolipetsk Iron & Steel Corporation (“NISCO”) as
a 	mandatory 	respondent 	in 	its 	initial 	investigation. 	See 	Initiation 	of 	ADD
Investigations, 63 Fed. Reg. at 56,607; [HRC] from [Russia], 64 Fed. Reg. 9,312, 9,314
(Dep’t Commerce Feb. 25, 1999) (notice of prelim. determination of sales at [LTFV]).
However, NISCO subsequently withdrew from participation in the investigation. See
HRC from Russia, 64 Fed. Reg. at 38,628. 	Commerce used total AFA to derive the
Russia-wide rate because certain respondents did not respond to Commerce’s request
for information and Commerce could not verify, inter alia, NISCO’s questionnaire
response due to its withdrawal. See id., 64 Fed. Reg. at 38,630.
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In 2014, years after granting Russia market economy status for purposes of
applying U.S. antidumping laws, Commerce terminated the Suspension Agreement
and issued the [ADD] order covering HRC from Russia. 	See Termination of the
Suspension Agreement on [HRC] from [Russia], Rescission of 2013–2014 Admin.
Review, and Issuance of [ADD] Order, 79 Fed. Reg. 77,455 (Dep’t Commerce Dec. 24,
2014) (“ADD Order”). Commerce set the cash deposit rate equal to margins calculated
in the final determination of its initial investigation, using the 184.56 percent Russia-
wide rate as the all-others rate. 4 See HRC from Russia, 64 Fed. Reg. at 38,641; ADD
Order, 79 Fed. Reg. at 77,456.
On December 29, 2017, after making an entry and sale of HRC from Russia,
Plaintiffs requested an administrative review of the ADD Order. 	See Compl. at
¶¶ 6–8, 10, Sept. 9, 2019, ECF No. 6; NLMK’s Req. for Admin. Review: [HRC] from
Russia, PD 3, bar code 3656817-01 (Dec. 29, 2017). 5 	Commerce initiated this
administrative review and preliminarily determined that Plaintiffs’ sale did not
constitute a bona fide sale. [HRC] from [Russia], 84 Fed. Reg. 4,776 (Dep’t Commerce
4 NLMK and NOVEX failed to timely challenge the all-others rate when the
suspension agreement was terminated and the ADD Order issued, 	see Novolipetsk
Steel Pub. Joint Stock Co. v. United States, 44 CIT __, Slip Op. 20-58 (May 1, 2020),
and now seeks a new rate after having made the entry at issue in this proceeding.
5 On October 28, 2019, Defendant submitted indices to the public and confidential
administrative records underlying Commerce’s final determination. 	These indices
are located on the docket at ECF Nos. 21-1 and 21-2, respectively. 	All further
references in this opinion to administrative record documents are identified by the
numbers assigned by Commerce in those indices and preceded by “PD” and “CD” to
denote public or confidential documents.
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Feb. 	19, 	2019) 	(prelim. 	results 	of 	[ADD] 	admin. 	review; 2016–2017) 	(“Prelim.
Results”) and accompanying Decisions Memo. for the [Prelim. Results] at 7–8, A-821-
809, PD 108, bar code 3792089-01 (Feb. 11, 2019). 6 	For its final determination,
Commerce continued to find that Plaintiffs did not make a bona fide sale. 	Final
Decision Memo at 17–18. As such, Commerce continued to assign to NLMK’s entries
the “all-others” rate of 184.56 percent. See id.; see also Final Results, 84 Fed. Reg. at
38,949. 	NLMK and NOVEX’s appeal to this court ensued. 	See generally Compl.;
Summons, Sept. 9, 2019, ECF No. 1. 	On September 21, 2020, the court heard oral
argument. See Oral Arg., Sept. 21, 2020, ECF No. 49.
JURISDICTION AND STANDARD OF REVIEW
The court has jurisdiction pursuant to section 516A(a)(2)(B)(iii) of the Tariff
Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2018) 7 and 28 U.S.C.
§ 1581(c) (2018), which grant the court authority to review actions contesting the final
determination in an administrative review of an ADD order. 	The court will uphold
Commerce’s determination unless it is “unsupported by substantial evidence on the
record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i).
6 Commerce later published a correction notice not relevant to this dispute. 	See
[HRC] from [Russia], 84 Fed. Reg. 16,643 (Dep’t Commerce Apr. 22, 2019) (correction
to the prelim. results of the 2016–2017 admin. review).
7 Further citations to the Tariff Act of 1930, as amended, are to the relevant
provisions of Title 19 of the U.S. Code, 2018 edition.
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DISCUSSION
I. 	Commerce’s Decision to Analyze Bona Fide Sales
A. Commerce’s Authority Under 19 U.S.C. § 1675
Plaintiffs argue that 19 U.S.C. § 1675 does not allow Commerce’s bona fide
sales analysis in an administrative review. 	See Pls.’ Br. at 5–10. Namely, Plaintiffs
submit that Congress’s amendment of § 1675(a) to require a bona fide sales analysis
of U.S. sales in a new shipper review under § 1675(a)(2)(B)(iv) demonstrates that
Commerce does not have statutory authority under § 1675(a)(2)(A) to analyze the
bona fides of a U.S. sale in an administrative review. 	See id.; see also 	Trade
Facilitation and Trade Enforcement Act of 2015 (“TFTEA”), Pub. L. No. 114-125,
§ 433, 130 Stat. 122 (2016). 	Defendant and Defendant-Intervenor counter that the
court 	should 	defer 	to 	Commerce’s 	interpretation 	of 	its 	authority 	in 	light 	of
Congressional silence on the issue and that Commerce’s practice of applying a bona
fide sales analysis in an administrative review is consistent with its statutory
mandate. See Def.’s Memo. Opp’n Pls.’ Mot. J. Agency R. Confidential Version at 10–
15, Apr. 17, 2020, ECF No. 30 (“Def.’s Br.”); Def.-Intervenor [Nucor’s] Resp. Br.
Confidential Revised Version at 12–23, Apr. 17, 2020, ECF No. 33 (“Nucor’s Br.”). For
the following reasons, the court holds that Commerce’s bona fide sales analysis in an
administrative review is in accordance with law.
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PUBLIC VERSION
Section 1675(a)(2)(A) provides that, when conducting an administrative review
of an ADD order, Commerce shall determine “the normal value and export price (or
constructed export price) of each entry of the subject merchandise, and (ii) the
dumping margin for each such entry.” 	19 U.S.C. § 1675(a)(2)(A). 	This directive
reflects Commerce’s authorization under 19 U.S.C. § 1673(1) to impose antidumping
duties, in an amount equal to the amount by which normal value exceeds the export
price (or constructed price), on “a class or kind of foreign merchandise” that it
determines “is being, or is likely to be, sold in the United States at less than its fair
value[.]”8
Section 	1675(a)(2)(A) 	is 	capacious 	enough 	to 	accommodate 	Commerce’s
authority to examine which sales it will consider for purposes of establishing a
dumping margin in an administrative review in some circumstances. 	Section
1675(a)(2)(A) 	dictates 	how 	Commerce 	determines 	antidumping 	duties 	in 	an
administrative review of an ADD order stemming from an investigation pursuant to
19 U.S.C. § 1673. 	Under § 1675(a)(2)(A), Commerce must calculate the normal value,
8 After determining that merchandise is being (or is likely to be) entered and sold in
the United States at LTFV, and 	if the U.S. International Trade Commission
determines that imports of the merchandise cause (or threaten to cause) material
injury to a domestic industry, Commerce issues an ADD order requiring that
antidumping duties be assessed on the merchandise at an amount by which the
normal value of the merchandise exceeds its export price (or constructed export price).
19 U.S.C. § 1673. Provided that it receives timely requests, Commerce is statutorily
required to conduct periodic administrative reviews of an ADD order to determine
the amount of antidumping duties owed on each entry of subject merchandise during
the relevant period of review (“POR”). See 19 U.S.C. § 1675(a)(1)–(2).
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export price, and dumping margin of each entry of subject merchandise. 	See id. at
§ 1675(a)(2)(A). The statute prescribes methodologies for determining normal value
and export price. See, e.g., 19 U.S.C. §§ 1677a, 1677b. Export price is defined as the
“price at which the subject merchandise is first sold (or agreed to be sold),” § 1677a,
but the statute does not provide for what constitutes a sale. 	Commerce thus has
discretion to provide a reasonable interpretation for what constitutes a sale for
purposes of conducting an administrative review under § 1675(a)(2)(A).
Given 19 U.S.C. §§ 1675(a)(2)(A) and 1677a’s silence with respect to the issue
of what constitutes a sale, it is reasonable for Commerce to disregard sales that are
not bona fide in an effort to calculate a dumping margin that suitably approximates
an exporter or producer’s selling practices. 	See 19 U.S.C. §§ 1675, 1677a. 	Doing so
accords with Commerce’s statutory purpose under § 1673 of determining whether
goods are being sold at less than fair value. See 19 U.S.C. § 1675(a)(2)(A); 19 U.S.C.
§ 1673(1). See, e.g., Ceramica Regiomontana, S.A. v. United States, 10 CIT 399, 404–
05, 636 F. Supp. 961, 966 (1986), aff'd, 810 F.2d 1137, 1139 (Fed. Cir. 1987)
(“Ceramica”) (citing, inter alia, Chevron U.S.A., Inc. v. Natural Res. Def. Council,
Inc., 467 U.S. 837, 843, (1984) (“Chevron”)).
The court cannot discern from Congress’s amendments to § 1675(a)(2)(B) alone
an intent to preclude Commerce’s authority to analyze the bona fides of a U.S. sale in
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an administrative review. 9 Congress’s amendments to § 1675(a)(2)(B) are not worded
restrictively, but rather, impose an affirmative obligation on Commerce to ensure
that U.S. sales used to calculate an individual margin for a new shipper are bona fide.
The legislative history indicates that Congress was driven by concerns that exporters
and producers were abusing the ability to obtain a new shipper rate on an expedited
basis in order to circumvent antidumping and countervailing duties. 	See H.R. REP.
NO . 114-114, pt. 1, at 89 (2015). 	Congress’s statutory solution to circumvention in
the context of a new shipper review does not on its own amount to a preclusion of
Commerce’s authority to conduct a bona fides sales analysis in an administrative
review. 	Indeed, Congress, in amending § 1675, did not make any changes to the
provisions governing administrative reviews that would imply such an intent. That
Congress is presumed to be aware of Commerce’s practice when it amended 19 U.S.C.
§ 1675 lends force to the notion that Congress’s amendments do not speak to
9 Exporters or producers not previously assigned a dumping margin may, under
certain conditions, request a new shipper review. 	Namely, if Commerce receives a
request from an exporter or producer of the subject merchandise establishing that it
did not export (and was not affiliated with an exporter or producer that did export)
subject merchandise into the United States during the period of investigation giving
rise to the ADD order, Commerce is statutorily required to calculate an individual
weighted-average dumping margin for that exporter or producer. 	See 19 U.S.C.
§ 1675(a)(2)(B)(i). On February 24, 2016, Congress enacted section 443 of the TFTEA,
and modified 19 U.S.C. § 1675(a)(2)(B) to require that Commerce only use bona fide
sales as the basis for calculating an individual dumping margin in a new shipper
review.
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Commerce’s practice within the context of an administrative review. 10 See Lorillard
v. Pons, 434 U.S. 575, 580 (1978). Accordingly, and as prior rulings from this Court
have recognized, it is reasonable for Commerce to interpret the statute as authorizing
it to disregard transactions it reasonably concludes are not bona fide sales. See, e.g.,
Windmill Int’l Pte v. United States, 26 CIT 221, 230–32, 193 F. Supp. 2d 1303, 1312–
14 (2002).
B. Commerce Reasonably Exercised Its Discretion
Plaintiffs challenge Commerce’s decision to conduct a bona fides analysis
because NLMK has a long history of exporting HRC to the United States, and the
importer of record, NOVEX, is its affiliated trading company. See Pls.’ Br. at 10–14.
Defendant counters that Commerce’s decision to conduct a bona fides analysis is not
subject to review. 	See Def.’s Br. at 16–17. 	Nonetheless, Defendant and Nucor both
submit that Commerce’s decision is reasonable in light of the facts and circumstances
of this proceeding. See id. at 16–18; see also Nucor’s Br. at 19–23. For the following
reasons, the court holds that Commerce reasonably exercised its discretion.
10 As such, the court is not persuaded by Plaintiffs’ reliance on Thomas v. Nicholson
and Saha Thai Steel Pipe Pub. Co. Ltd. v. United States. See Pls.’ Br. at 8 (citing 423
F.3d 1279 (Fed. Cir. 2005); 43 CIT __, 422 F. Supp. 3d 1363 (2019)). Those cases do
not deal with instances where Congress acted to codify a pre-existing agency practice
in one part of the statute, and do not touch on the issue of whether Congress, by its
silence, intended to revoke that practice in another part of the statute.
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Commerce has an administrative practice under certain circumstances of
analyzing the bona fides of U.S. sales in administrative reviews. 	Cf. Final Decision
Memo at 7; see also Certain Oil Country Tubular Goods From Turkey, 83 Fed. Reg.
64,107 (Dep’t Commerce Dec. 13, 2018) (final results of [ADD] admin. review; 2016–
2017) (“OCTG from Turkey”) and accompanying Issues and Decisions Memo. for
[OCTG 	from 	Turkey] 	at 	10–11, 	A-489-816, 	(Dec. 	7, 	2018) 	available 	at
https://enforcement.trade.gov/frn/summary/turkey/2018-26973-1.pdf 	(last 	visited
Nov. 21, 2020) (“OCTG from Turkey IDM”). As explained by Commerce, “[w]hile bona
fide sales analyses always arise in the context of new shipper reviews, if a producer’s
or exporter’s transactions involve prices, quantities, or overall circumstances that are
questionable, Commerce will evaluate the bona fides of the sale in the context of an
administrative review.” Final Decision Memo at 8; see also OCTG from Turkey IDM
at 10. Contrary to Defendant’s submission, Def.’s Br. at 16–18, the court may review
Commerce’s decision to conduct a bona fide sales analysis to determine whether it
has reasonably explained any deviation from an agency practice. 	See Atchison,
Topeka & Santa Fe Ry. Co. v. Wichita Bd. of Trade, 412 U.S. 800, 808 (1973). Further,
although Commerce has authority to determine what constitutes a sale when
calculating a dumping margin under 19 U.S.C. § 1675, the means by which it chooses
to do so must be reasonable. See Chevron, 467 U.S. at 843–44.
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Here, Commerce’s decision to examine the bona fides of NLMK’s sale is
reasonable. 	It is reasonably discernible from Commerce’s reference to the principle
that “single sale[s] must be ‘carefully scrutinized’” that Commerce is importing what
was previously an agency practice of examining single sale transactions during a new
shipper review into its methodology for conducting an administrative review. 	See
Final Decision Memo at 16 (citations omitted). 	Further, Commerce’s practice is
reasonable in an administrative review; a single sale transaction may warrant
further scrutiny because there are fewer transactions from which to draw inferences
about the exporter or producer’s selling practices. 	See id. at 13; Prelim. Bona Fide
Sales Analysis Memo. at 14, PD 111, CD 197, bar codes 3793192-01, 3793189-01 (Feb.
11, 2019) (“Bona Fides Sales Memo”). 	Thus, given its authority to disregard
transactions that do not constitute bona fide sales, Commerce’s practice of examining
a single sale transaction is reasonable in an administrative review.
As such, Plaintiffs’ arguments regarding NLMK’s history of exporting into the
United States are inapposite. See Pls.’ Br. at 10–14. 	Under 19 U.S.C. § 1675(a)(2)(A),
Commerce seeks to calculate a dumping margin that accurately approximates the
exporter or producer’s selling practices, and where the entry under review is based
on a single transaction it is reasonable for Commerce to take a closer look to make
sure the price was based on commercial considerations. 	Doing so will enable
Commerce to calculate a dumping margin that better approximates a respondent’s
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selling 	practices, 	which 	is 	consistent 	with 	Commerce’s 	statutory 	purpose 	of
determining whether merchandise is being sold at LTFV.
II. 	Whether NLMK’s Entry is a Bona Fide Sale
Plaintiffs argue that Commerce’s determination is unsupported by substantial
evidence because the record does not support Commerce’s conclusion that its sale is
commercial unreasonable. See Pls.’ Br. at 14–46. Defendant and Nucor counter that
Commerce’s determination is reasonable based on the record and that Plaintiffs’
challenge amounts to a request for the court to reweigh the evidence. See Def.’s Br.
at 23–40; Nucor’s Br. at 23–41. 	For the following reasons, the court sustains
Commerce’s determination that NLMK’s entry is not a bona fide sale.
Commerce employs a totality-of-the-circumstances approach to determine
whether U.S. sales are bona fide in an administrative review. Similar to its practice
in new shipper reviews, now codified in § 1675(a)(2)(B)(iv), Commerce explains that
[It] consider[s] the following factors when determining if a sale is bona
fide: (1) timing of the sale; (2) price and quantity; (3) expenses arising
from the transaction; (4) whether the goods were resold at a profit; and
(5) 	whether 	the 	transaction 	was 	made 	at 	arm’s 	length. 	Thus,
[Commerce] consider[s] a number of factors in [its] bona fide analysis,
“all of which may speak to the commercial realities surrounding an
alleged sale of subject merchandise.”
Final Decision Memo at 11 (citations omitted). According to Commerce, “the weight
given to each factor investigated will depend on the circumstances surrounding the
sale[,]” and that it “is highly likely to examine objective, verifiable factors to ensure
that a sale is not being made to circumvent an AD Order.” 	Id. (citations omitted).
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Commerce’s 	determinations 	must 	be 	supported 	by 	substantial 	evidence. 	The
evidence must be sufficient that a reasonable mind might accept the evidence as
adequate to support its conclusion while considering contradictory evidence. 	See
Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938); see also Suramerica de
Aleaciones Laminadas, C.A. v. United States, 44 F.3d 978, 985 (Fed. Cir. 1994).
Here, Commerce offers several reasons for its determination that NLMK’s U.S.
sale is not bona fide. First, with respect to the pricing and quantity of the sale, upon
comparison to NLMK’s third-country sales, Commerce observes that the price of
NLMK’s sale is significantly higher, and the quantity of the sale is significantly lower,
than other export transactions that NLMK made during the same period.11 See Final
11 Commerce maintains its finding that the price per unit of NLMK’s U.S. sale was
significantly higher than NLMK and NOVEX’s other export sales made during the
same period. 	Final Decision Memo at 12 (citing Bona Fides Sales Memo at 5–6).
Specifically, Commerce explained
Of NOVEX’s 	third country sales, and NLMK’s sole shipment of
subject merchandise for 	metric tons (MT) with a per-unit value
of USD 683.4 per MT had the third highest unit price of the
third country sales – or a unit price higher than 	percent of
NOVEX’s export sales. The 	sales with the highest unit prices
had a per unit value of USD 	per MT. The 	highest
unit price of the third country sales was made at a substantially lower
price of USD 	per MT. Additionally, an average of the unit prices
of NOVEX’s third country sales indicated that the three sales with the
highest unit prices were made at prices significantly higher than the
average - ranging from USD 	per MT above the average
price of USD 	per MT. Given this information, we find that the
per unit price of NLMK’s sole U.S. sale is significantly higher than
(footnote continued)
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Decision Memo at 12–14. 	Second, Commerce cites email correspondences between
NLMK and its unaffiliated customer discussing the need to enter the merchandise
before the end of the period of review (“POR”) in order to revoke the ADD order on
HRC from Russia as evidence that the timing of the sale did not arise out of ordinary
commercial considerations. See id. at 14 (citing Bona Fides Sales Memo at 7, 8–11).
Third, although Commerce notes that NLMK had previously conducted business with
its customer, Commerce points to email correspondences with NLMK dictating the
terms of the sale as evidence that the transaction was not negotiated at arms-length,
which Commerce defines as being based on independent business interests. 	See id.
at 14–15 (citing Bona Fides Sales Memo 	at 8–13). 	Finally, with respect to other
relevant factors, Commerce notes NLMK/NOVEX’s contradictory statements about
the merchandise when urging the customer to make the purchase, see id. at 15 (citing
Bona Fides Sales Memo at 9–11), 12 the failure of NLMK’s customer to adhere to the
NLMK’s/NOVEX’s other export sales made during the same period.
Thus, we find that the price of NLMK’s POR sale is not representative
of a normal business practice and, does not indicate that the sale is bona
fide.
Bona Fides Sales Memo at 6 (citations omitted).
12 Commerce explained
Next, 	email 	correspondence 	indicates 	that 	NLMK/NOVEX 	made
contradictory statements to justify the shipment of certain hot-rolled
coils[.] 	stated in emails that 	hot-rolled coils
produced to these specifications had been found in inventory and were
(footnote continued)
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payment terms, the refusal of NLMK’s sales agent to provide certain financial
statements, see id. at 16, and the fact that only a single sale was made during the
POR as evidence that NLMK’s sale is atypical. See id.
Commerce’s determination that NLMK’s U.S. sale is not bona fide is supported
by substantial evidence. 	First, it is reasonable that Commerce infers, from email
exchanges documenting instances where the seller directed the terms of the sale for
its 	customer, 	that 	NLMK’s 	transaction 	was 	not 	negotiated 	at 	arms-length.13
left over from a previous order for 	and NLMK also
asserted on the record that
However, previously in a separate submission,
NLMK explained that it had not sold hot-rolled steel to
since the demise of the suspension agreement in 2014. We also note that
record evidence from the sales trace for the sole U.S. sale during the
POR indicates that these 	hot-rolled coils were produced just
prior to shipment in 2017. As such, record evidence indicates that
NLMK 	and 	NOVEX 	made 	contradictory 	statements 	to 	justify 	the
shipment of certain hot-rolled coils prior to the end of the POR, which
the final customer was 	even though it
had requested a different product to be shipped to
rather than
Bona Fides Sales Memo at 10.
13 Record evidence suggests that the customer entered into the transaction as a favor
to NLMK. 	Commerce cites an email exchange demonstrating that the customer
planned to purchase HRC produced to one of 	specifications
requested 	See
Bona Fides Sales Memo at 8–11 (citing, inter alia, NLMK Third Suppl. Questionnaire
Resp. at Ex. SA3-2, CD 188, bar code 3746640-02 (Aug. 21, 2018)). 	NLMK/NOVEX
would
in order to initiate the administrative
review. See id.; see also Final Decision Memo at 14 & n.61.
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Commerce observes that an arms-length transaction is one that is negotiated based
on independent interests, Final Decision Memo at 14 (citations omitted), and it is
reasonable to infer from evidence that demonstrates a customer is setting its terms
based on the producer’s preferences that the customer is not negotiating based on its
own independent interests.14 	Second, without detracting evidence explaining the
significant difference in pricing and quantity between its U.S. sale and its third
country transactions, and given record evidence demonstrating NLMK’s motivations
for making the U.S. sale, the pricing of NLMK’s transaction reasonably suggests the
price is artificially inflated to reduce NLMK’s dumping margin. 	A higher price for
NLMK’s U.S. sale would lead to a lower dumping margin by narrowing, if not
eliminating, the difference between the export price and normal value of the sale.
Taken together with the rest of Commerce’s findings, see Final Decision Memo at 15–
16, the court cannot say that it is unreasonable for Commerce to conclude, based on
the totality of the circumstances, that NLMK’s U.S. sale was not bona fide. 	That
Plaintiffs 	disagree 	is 	insufficient 	to 	demonstrate 	Commerce’s 	determination 	is
14 Plaintiffs argue that a sale to an unaffiliated customer is, ipso facto, an arm’s length
transaction. Pls.’ Br. at 37–38 (citing, inter alia, AK Steel Corp. v. United States, 226
F.3d 1361, 1367 (Fed. Cir. 2000) (“AK Steel Corp.”). The passage from AK Steel Corp.
that Plaintiffs cite discusses Commerce’s methodology for deriving the export price
(or constructed export price) under 19 U.S.C. § 1677a, and Plaintiffs otherwise fail to
point to any legal authority limiting Commerce’s discretion to make a record-based
determination of whether a transaction is made at arms-length during its bona fide
sales analysis.
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unreasonable. 15 	See Downhole Pipe & Equipment, L.P. v. United States, 776 F.3d
1369, 1376 (Fed. Cir. 2015); see also Zhejiang DunAn Hetian Metal Co. v. United
States, 652 F.3d 1333, 1341 (Fed. Cir. 2011).
Plaintiffs’ challenges with respect to Commerce’s examination of the price of
NLMK’s sale arise from their position that 	Commerce’s practice is merely to
determine whether the “price . . . is in line with general price trends in the U.S.
market.” Pls.’ Br. at 17 (citations omitted).16 As such, Plaintiffs contest Commerce’s
15 Plaintiffs disagree with the inferences Commerce draws from the record evidence.
For example, Plaintiffs submit that Commerce’s conclusion that record evidence of a
late payment of 41 days weighs in favor of its finding that the transaction at issue
was not bona fide is unsupported by substantial evidence. 	See Pls.’ Br. at 42–43.
Instead of pointing to detracting evidence that would impugn the reasonableness of
Commerce’s conclusion, Plaintiffs cite their statement that “[o]n occasion, payment
may lag with any customer in the ordinary course of business . . . [n]otwithstanding
the payment terms, sometimes customers wait until the merchandise is delivered and
examined before rendering payment.” Pls.’ Br. at 42 (citing Customer-Specific Suppl.
Questionnaire Resp. at 9, PD 73, CD 143 bar codes 3735851-01, 3735845-01 (July 27,
2020)). Proffering a reasonable inference to be drawn from the record, however, does
not demonstrate that Commerce’s determination is unreasonable.
16 Plaintiffs rely in part on a bona fide sales analysis memorandum from the 2014–
2015 administrative review of Commerce’s ADD order on polyethylene retail carrier
bags from Malaysia as support for their assertion, see Pls.’ Br. at 17, but it is unclear
from the final results of that review whether Commerce limits its examination as
Plaintiffs argue. See Polyethylene Retail Carrier Bags From Malaysia, 81 Fed. Reg.
75,378 (Dep’t Commerce Oct. 31, 2016) (final results of the [ADD] admin. review;
2014–2015) (“Polyethylene from Malaysia”) and accompanying Issues and Decisions
Memo. for the [Polyethylene from Malaysia] at 6, A-557-813, (Oct. 24, 2016), available
at 	https://enforcement.trade.gov/frn/summary/malaysia/2016-26220-1.pdf 	(last
visited Nov. 21, 2016) (“Polyethylene from Malaysia IDM”) (“U.S. import price data
(footnote continued)
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reliance on NLMK’s third country sales as a benchmark against which to evaluate
the price and quantity of their U.S. sale, maintaining that Commerce generally uses
data from U.S. Customs and Border Protection (“CBP”) as well as U.S. International
Trade Commission (“ITC”) Dataweb data containing broad monthly average prices
(“CBP data” and “ITC data”, respectively).17 	See Pls.’ Br. at 17–20 (asserting that
CBP and ITC data are the golden standard for purposes assessing the commercial
reasonableness of NLMK’s sale).
However, Commerce explains, that when analyzing the bona fides of a
transaction, “either as an alternative or in addition to the CBP data examination,
Commerce may also compare a respondent’s selling price and quantity . . . to a
on the record indicate that the price of [the] sale was within the range of AUVs for
comparable goods[.]”). 	Moreover, in Polyethylene from Malaysia, unlike here,
Commerce 	found 	that 	the 	U.S. 	sale 	was 	“not 	reflective 	of 	a 	commercially
unreasonable quantity, which is typically seen where parties attempt to ‘test the
waters’ or manipulate the dumping margin.” Polyethylene from Malaysia IDM at 6.
Even if Commerce here deviates from a purported practice with respect to its
examination of the price of NLMK’s sale, it is apparent to the court that the deviation
is reasonable, given the differing factual circumstances and the fact that Commerce
here weighs the evidence based on the totality of the circumstances.
17 Plaintiffs also argue that Commerce rejected the ITC and CBP data for conclusory
reasons. 	Pls.’ Br. at 18 (citing Final Decision Memo at 13). 	However, Commerce is
not obliged to use these datasets given its 	apparent practice of using third country
sales data either in addition to, or as an alternative, to such sources. 	See Final
Decision Memo at 12–13. 	Commerce reasonably explains that it prefers to use
NLMK’s third country sales as a benchmark in this instance because the raw data is
transaction specific, unlike the ITC and CBP data. 	Final Decision Memo at 12–13.
Moreover, Commerce explains that the volume of NLMK’s third country sales is
substantial enough to avoid sample size concerns. See id. Plaintiffs fail to persuade
that Commerce’s approach in this instance is unreasonable.
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respondent’s own sales, whether these were made to third country markets or to the
United States before or after the POR.” See Final Decision Memo at 12–13 (citations
omitted).18 	In this instance, Commerce uses NLMK’s third country sales as an
alternative 	because 	the 	ITC 	and 	CBP 	data 	do 	not 	provide 	information 	on 	a
transaction-specific basis. See id. Given that it is examining the bona fides of a single
sale, it is not unreasonable, nor contrary to Commerce’s practice, to use NLMK’s third
country sales as a benchmark. 	As explained by Commerce, doing so enables it to
18 Plaintiffs and Defendant dispute Commerce’s justification for not using the CBP
data. See Def.’s Br. at 19 (arguing that Commerce properly disregarded the CBP data
on entries of Russian HRC because it consisted of
but see Pls.’ Br. at 18–20; Pls.’ Reply Br. Confidential Version at 12, May 22, 2020,
ECF No. 37 (citing Final Decision Memo at 13 n. 53) (arguing that Commerce’s
decision to disregard was based on an entry error). Even if it is the case, as Plaintiffs
suggest, that Commerce could have expanded the scope of its query to include CBP
data beyond 	Pls.’ Br. at 18–19, it is not unreasonable for Commerce
to conclude that comparing NLMK’s transaction to NLMK/NOVEX’s third country
sales is an appropriate methodology for determining whether the transaction is bona
fide. 	See Final Decision Memo at 13–14. 	Commerce explains that it prefers to use
transaction specific data, id. at 13, meaning that the raw data provides Commerce
with a range of entries that may be averaged. Id. Moreover, according to Commerce,
because the sample size of third country sales is large, and because NLMK’s U.S.
sales and third country sales are all export sales made through the same channel,
Commerce finds the third country sales to be the most reliable benchmark for
assessing whether NLMK’s U.S. sale is bona fide. 	Id. 	Plaintiffs insist that the
“concept of a ‘transaction specific benchmark’ is methodologically unsound,” see, e.g.,
Pls.’ Br. at 20, 27, but fail to persuasively explain to the court how Commerce’s
methodological choice is unreasonable in this instance.
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analyze the full range of shipments upon which it relies to construct a benchmark.
See id. at 12–13.
Finally, Plaintiffs argue there is nothing commercially unreasonable about
arranging a transaction in such a way as to enable NLMK to seek an administrative
review and obtain a lower dumping margin, particularly in light of commercial
realities surrounding the sale. 19 	See, e.g., Pls.’ Br. at 30, 39, 41–42. 	It may be
commercially reasonable to seek a lower dumping margin, and it is unsurprising that
a company would seek to do so. 	However, the court’s position is to review whether
Commerce reasonably supports its determination based on the factors enumerated in
its totality-of-the-circumstances analysis. 	As explained, Commerce adduces enough
evidence to allow a reasonable mind to conclude that NLMK’s transaction was not
representative of its selling practices in the United States. See Final Decision Memo
at 12, 14. As such, Commerce’s determination is sustained.
19 Plaintiffs argue that Commerce erred by applying its bona fides sales analysis in a
vacuum and failing to consider record evidence that “prices in the U.S. market during
the period of review were high and expected to increase due to the pending imposition
of Section 232 tariffs.” Pls.’ Br. at 30 (citing Customer-Specific Questionnaire Resp.
at 11–12, PD 51, bar code 3716358-01 (June 8, 2018)). 	However, it is reasonably
discernible from Commerce’s analysis of the email correspondences that it finds
NLMK’s purpose for making the sale was unrelated to market conditions in the
United 	States. 	See, 	e.g., 	Bona 	Fide Sales 	Memo 	at 11 	(concluding 	that 	the
correspondence “indicates that the sole U.S. sale made during the POR was designed
and placed in the United States just prior to the end of the POR in order to revoke
the 	antidumping 	duty 	order 	and 	was 	thus 	not 	based 	on 	normal 	business
considerations.”); see also, e.g., Final Decision Memo at 14. 	The court declines to
reweigh the evidence.
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III. 	Commerce’s Decision to Rescind the Administrative Review
Plaintiffs argue that Commerce lacks statutory authority to rescind the
administrative review of its entry. 	See Pls.’ Br. at 46–52. 	Defendant and Nucor
counter that Commerce has authority to rescind an administrative review where
there are no bona fide sales upon which to calculate a dumping margin. 	See Def.’s
Br. at 40–41; Nucor’s Br. at 41–44. 	For the following reasons, Commerce’s decision
to rescind the administrative review is sustained.
Upon request, 19 U.S.C. § 1675(a) directs Commerce to perform a periodic
administrative review of an ADD order. 	As explained, Commerce has authority to
determine an appropriate methodology when conducting an administrative review
and may disregard U.S. sales if it finds that those sales are not bona fide. 	See
§§ 1673(1), 1675(a), 1677a; see also Ceramica, 10 CIT at 404–05, 636 F. Supp. at 966
(citing Chevron, 467 U.S. at 843).
Here, Commerce explains that it is justified in rescinding the review because
it lacks a bona fide U.S. sale upon which to determine NLMK’s dumping margin. See
Final Decision Memo at 17–18. The wording of § 1675(a) does not speak to the issue
of whether Commerce must conduct and conclude an administrative review where it
does 	not 	have 	a 	bona 	fide 	sale 	upon 	which 	to 	calculate 	a 	dumping 	margin.
Commerce’s determination is reasonable because, as it explains, “[c]alculating a rate
based on a non-bona fide sale would create an inaccurate margin.” 	Final Decision
Memo at 17. As such, Commerce’s determination to rescind the review is sustained.
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Plaintiffs argue that Commerce’s decision to rescind the administrative review
impermissibly applies AFA to a cooperative respondent. 	See Pls.’ Br. at 52–55.
Plaintiffs argument fails because Commerce is simply not applying facts available.
See Final Decision Memo at 18. 	Commerce uses facts available to address a gap in
the record evidence when calculating a dumping margin for an exporter or producer.
19 U.S.C. § 1677e(a). 	Here, Commerce is rescinding the review, and declining to
calculate a new dumping margin for NLMK. See Final Decision Memo at 17–18. The
consequence is that the 184.56 percent rate continues to apply. Plaintiffs argue the
rate is unreasonable as applied to them. Yet, the all-others rate went unchallenged
upon termination of the Suspension Agreement. 	Parties had the opportunity to
challenge the rate when Commerce issued the final results upon the lifting of the
Suspension Agreement.20 	19 U.S.C. § 1516a(a)(2)(A)(i)(II), (a)(2)(B)(i). 	Neither
Plaintiffs nor any other participant to the proceedings did. 	The application of the
rate in this case, as the all-others rate, is a function of the failure of Plaintiffs to make
one or more bona fide sales.
20 A party may challenge an ADD order based upon a final affirmative determination
by filing in this Court both a summons, within 30 days of the order’s publication in
the Federal Register, and, within 30 days later, a complaint. 	See 19 U.S.C.
§ 	1516a(a)(2)(A)(i)(II), 	(a)(2)(B)(i). 	Here, 	Commerce 	made 	a 	final 	affirmative
determination that HRC from Russia is being sold at LTFV, and following the
termination of the Suspension Agreement, published the ADD Order. See HRC from
Russia, 64 Fed. Reg. at 38,641; ADD Order, 79 Fed. Reg. at 77,456. Neither Plaintiffs
nor any participant to the proceeding commenced an action within 30 days of the
publication of the ADD Order.
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CONCLUSION
For the foregoing reasons, Commerce’s final determination is supported by
substantial evidence and in accordance with the law and is therefore sustained.
Judgment will enter accordingly.
/s/ Claire R. Kelly
Claire R. Kelly, Judge
Dated: 	November 30, 2020
New York, New York
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