United States Steel Corporation v. United States, Bluescope Steel (ais) Pty Ltd., Bluescope Steel Ltd, Bluescope Steel…

United States Court of Appeals
for the Federal Circuit
______________________
UNITED STATES STEEL CORPORATION,
Plaintiff-Appellant
NUCOR CORPORATION,
Plaintiff
v.
UNITED STATES, BLUESCOPE STEEL (AIS) PTY
LTD., BLUESCOPE STEEL LTD, BLUESCOPE
STEEL AMERICAS, INC.,
Defendants-Appellees
______________________
2022-2078
______________________
Appeal from the United States Court of International
Trade in No. 1:20-cv-03815-RKE, Senior Judge Richard K.
Eaton.
______________________
Decided: April 4, 2024
______________________
S ARAH E. SHULMAN, Cassidy Levy Kent (USA) LLP,
Washington, DC, argued for plaintiff-appellant. Also rep-
resented by YOHAI B AISBURD, T HOMAS M. BELINE, CHASE
D UNN, J AMES E DWARD RANSDELL , IV.
EMMA EATON BOND, Commercial Litigation Branch,
Civil Division, United States Department of Justice,
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UNITED STATES STEEL CORPORATION v. US 2
Washington, DC, argued for defendant-appellee United
States. Also represented by BRIAN M. BOYNTON, T ARA K.
HOGAN, P ATRICIA M. MCCARTHY ; SPENCER N EFF , Office of
the Chief Counsel for Trade Enforcement & Compliance,
United States Department of Commerce, Washington, DC.
D ANIEL L. P ORTER, Curtis, Mallet-Prevost, Colt &
Mosle LLP, Washington, DC, argued for defendants-appel-
lees BlueScope Steel (AIS) Pty Ltd., BlueScope Steel Ltd,
BlueScope Steel Americas, Inc. Also represented by J AMES
BEATY , CHRISTOPHER A. D UNN, J AMES P. D URLING.
______________________
Before M OORE, Chief Judge, HUGHES and STARK, Circuit
Judges.
HUGHES , Circuit Judge.
United States Steel Corp. appeals a decision from the
United States Court of International Trade sustaining the
Department of Commerce’s determination that Australian
producer and exporter of hot-rolled steel, BlueScope Steel
(AIS) Pty Ltd., did not reimburse its affiliated U.S. im-
porter, BlueScope Steel Americas, Inc., for antidumping
duties. Because we agree with the trial court that the
agency’s determination is supported by substantial evi-
dence and is otherwise in accordance with law, we affirm.
I
A
Under the Tariff Act of 1930, as amended, the Depart-
ment of Commerce is authorized to administer the anti-
dumping statute. See 19 U.S.C. §§ 1673, 1677(1). The
purpose of the antidumping statute is to protect domestic
industries from injury caused by foreign manufactured
goods that are sold in the United States at prices below the
fair market value of those goods. See U.S. Steel Corp. v.
United States, 621 F.3d 1351, 1353 (Fed. Cir. 2010). In
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UNITED STATES STEEL CORPORATION v. US 3
administering the statute, the agency will conduct investi-
gations and assess antidumping duties where it deter-
mines that foreign goods are being sold in the United
States at less-than-fair value. 19 U.S.C. § 1673. If re-
quested by an interested party, the agency must also con-
duct an annual review of a previously issued antidumping
duty order to determine the amount of dumping and the
duties owed for the period of review. Id. § 1675(a)(1)(B),
(2)(A). During the review, the agency calculates a “dump-
ing margin” by comparing the price at which the merchan-
dise is sold in the United States (export price) to a “normal
value” benchmark. See id. §§ 1675(a)(2)(A)(ii),1677(35)(A).
Where a domestic importer is affiliated with the foreign ex-
porter, the agency will use “constructed export price,” de-
fined as the price at which the merchandise is first sold to
a non-affiliated purchaser, with adjustments made to ac-
count for expenses incurred by the affiliated seller. Id.
§ 1677a(b), (d)(1).
When calculating export price or constructed export
price, the agency must also account for additional factors,
including whether the exporter has reimbursed the im-
porter for antidumping duties owed on the merchandise.
See 19 C.F.R. § 351.402(a), (f). If the agency finds that the
importer has been reimbursed for antidumping duties, it
will subtract the amount of reimbursement from the calcu-
lated export price, ultimately leading to a higher dumping
margin and a larger duty owed. Id. § 351.402(f)(1)(i) (“In
calculating the export price (or the constructed export
price), the Secretary will deduct the amount of any anti-
dumping duty or countervailing duty which the exporter or
producer . . . [p]aid directly on behalf of the importer;
or . . . [r]eimbursed to the importer.”). The agency requires
importers to file a certification with United States Customs
and Border Protection stating whether the importer has
been reimbursed or refunded by the manufacturer, pro-
ducer, seller, or exporter for all or part of the antidumping
duties assessed. Id. § 351.402(f)(2)(i).
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UNITED STATES STEEL CORPORATION v. US 4
B
This appeal arises out of the Department of Com-
merce’s second administrative review of the existing anti-
dumping duty order on hot-rolled steel flat products from
Australia, covering a period of review from October 1, 2017
to September 30, 2018. Defendants-Appellees BlueScope
Steel (AIS) Pty Ltd., BlueScope Steel Ltd, and BlueScope
Steel Americas, Inc. (collectively, BlueScope) are all affili-
ated parties that comprise the only hot-rolled steel pro-
ducer and exporter in Australia. BlueScope Steel Ltd
(hereinafter, BSL) is the ultimate corporate parent com-
pany. BlueScope Steel (AIS) Pty Ltd. (hereinafter, AIS) is
a wholly owned subsidiary of BSL and is the actual pro-
ducer and exporter of BlueScope hot-rolled steel.
BlueScope Steel Americas, Inc. (hereinafter, BSA) is the af-
filiated United States importer. BSL also owns a 50% con-
trolling interest in Steelscape LLC, an affiliated
downstream U.S. customer that receives the majority of
the imported steel.
For exports of AIS steel that are destined for Steels-
cape, AIS first invoices BSA, and in a “back-to-back trans-
action,” BSA then invoices the ultimate customer,
Steelscape. BlueScope Br. 4. The shipment of the physical
merchandise goes directly from AIS to Steelscape.
Prior to the agency’s release of its preliminary findings
in the 2017–2018 administrative review, Plaintiff-Appel-
lant United States Steel Corp. (hereinafter, U.S. Steel) al-
leged that BlueScope had reimbursed BSA for the
antidumping duties it incurred when importing AIS steel.
U.S. Steel argued to the agency—and now argues to us on
appeal—that BlueScope engaged in antidumping duty re-
imbursement by failing to charge BSA a predetermined
“formula price” and instead charged a price that accounted
for estimated antidumping duties owed by BSA. The “for-
mula price” at issue in this case is housed in a supply agree-
ment between BlueScope entities. Because the parties offer
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UNITED STATES STEEL CORPORATION v. US 5
incompatible interpretations of the Supply Agreement and
the entities to which it applies, we present each party’s rec-
itation of the underlying facts in turn.
1
BlueScope explains that the Supply Agreement at is-
sue is a “Substrate Supply Agreement” among BSL, BSA,
and Steelscape. BlueScope Br. 6. BlueScope states:
The Agreement sets the price that BSA charges
Steelscape for the merchandise, according to a for-
mula using two published hot-rolled price indices.
Article 5.1 of the Supply Agreement uses this for-
mula to determine the price of the purchase order
(“PO”) that Steelscape submits to BSA. Article 3.5
of the Supply Agreement states that “Steelscape
will submit two POs {purchase orders} to BSA for
the total amount of HRC {hot-rolled coil} in the
Steelscape Order for each supply month . . . [.]” Ar-
ticle 6.1 of the Agreement further sets forth invoice
the price [sic] that “BSA will provide to Steelscape.”
That price is a delivered, duty-paid price—a price
that includes both the duties and the cost of deliv-
ering the merchandise to Steelscape.
BlueScope Br. 6–7 (internal citations omitted). In sum,
BlueScope asserts that while the Supply Agreement con-
trols the invoice price between BSA and Steelscape, it does
not set forth the “transfer price” for the transaction be-
tween AIS and BSA. Instead, BlueScope reports that it cal-
culates the transfer price between AIS and BSA by starting
with the formula price to Steelscape and subtracting the
estimated antidumping duties that BSA will owe. To sup-
port its explanation of the pricing methodology, BlueScope
submitted evidence into the agency record during review,
including a questionnaire response discussing the method-
ology, a copy of the Supply Agreement, and a series of sales
traces showing the actual amounts paid by AIS to BSA and
then BSA to Steelscape in previous transactions.
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UNITED STATES STEEL CORPORATION v. US 6
BlueScope also submitted evidence showing that BSA ac-
tually paid the antidumping duty amounts owed and filed
the certifications of nonreimbursement that are required
under 19 C.F.R. § 351.402(f)(2)(i). J.A. 25.
2
Notwithstanding BlueScope’s proffered explanation of
its own Supply Agreement, U.S. Steel has adopted the po-
sition that BSA—not Steelscape—is required to pay the
Supply Agreement’s formula price for hot-rolled steel. U.S.
Steel points to several record documents as support for this
contention. The first is the Supply Agreement itself, which
BlueScope submitted in response to the agency’s request
that BlueScope “[e]xplain how you determined the net unit
transfer price.” J.A. 114. In responding to that question,
BlueScope provided the Supply Agreement and stated that
the agreement governed “[t]he price of material sold by
BlueScope to BSA and subsequently to Steelscape.” J.A.
114. The second document is another questionnaire re-
sponse that provides a worksheet “demonstrat[ing] the ap-
plication of the transfer price formula” for a sale “made by
AIS on invoice to BSA and destined for Steelscape.” J.A.
1458. U.S. Steel also references a third questionnaire re-
sponse where BlueScope reported that “BlueScope issues
an invoice to BSA for the merchandise according to the
amount shipped and the formula price,” and further that
“there is no negotiation of sales prices or terms of sale be-
tween Steelscape and BSA or BSA and BlueScope.” J.A. 97.
Because U.S. Steel argues that BSA was required to
pay the formula price and because “the pricing formula
does not establish a basis to deduct antidumping duties,”
U.S. Steel concludes that BlueScope’s practice of calculat-
ing the transfer price between AIS and BSA by subtracting
estimated duties from the formula price is impermissible
reimbursement of antidumping duties. Appellant’s Br. 8–9,
12 (“That BlueScope lowered the price of the [hot-rolled
steel] by antidumping duties outside of its pricing formula
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UNITED STATES STEEL CORPORATION v. US 7
is evidence of reimbursement.”). In response, BlueScope ar-
gues that “nothing in the Substrate Supply Agreement sets
forth the invoice price that foreign producer AIS is to
charge its related party importer BSA for the merchan-
dise,” and therefore, “AIS cannot have ‘lowered’ an invoice
price when that invoice price is nowhere set forth in the
relevant agreements between the parties.” BlueScope Br.
9.
C
In its preliminary findings, the agency rejected U.S.
Steel’s allegations of reimbursement, stating that its pre-
liminary analysis of the record “[did] not demonstrate that
BlueScope reimbursed its U.S. affiliate.” J.A. 48. Because
the agency did not find evidence of reimbursement, it did
not adjust BlueScope’s U.S. gross unit price to account for
such reimbursement. In its final results, the agency again
determined that BSA was not reimbursed for antidumping
duties deposited during the period of review. The agency
focused on record evidence showing that BSA filed the req-
uisite certifications of nonreimbursement when it imported
subject merchandise and stated that “there [was] no record
evidence to contradict BSA’s statements in these certifica-
tions.” J.A. 25. In fact, the agency found that BlueScope
submitted record evidence to support the statements of
nonreimbursement and further that the information
demonstrated that BSA actually paid the requisite cash de-
posit of antidumping duties. The agency determined that
BlueScope’s explanation of the Supply Agreement “showed
that these parties have a long-standing supply agreement
which set the transfer prices of subject merchandise to
Steelscape according to a formula.” J.A. 26 (emphasis
added). Turning to BlueScope’s method of calculating the
transfer price between AIS and BSA, the agency stated:
We disagree with the petitioners that record evi-
dence establishes that AIS deducted [antidumping]
duties when setting the price to BSA. Rather, the
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UNITED STATES STEEL CORPORATION v. US 8
information provided by BlueScope demonstrates
that BSA paid [antidumping] duties on its imports
of subject merchandise, and it passed these duties
on to Steelscape as part of the transfer price
[charged] to it. Despite the petitioners’ claim, this
information does not show that AIS deducted [an-
tidumping] duties from the price that it charged to
BSA; to the contrary, it simply shows the calcula-
tion of the transfer price to the U.S. customer, al-
beit an affiliated one.
J.A. 26 (footnote omitted). The agency also addressed U.S.
Steel’s contention that a finding of no reimbursement was
inconsistent with previous agency decisions. The agency
explained that because there was “no evidence that AIS de-
ducted the [antidumping] duties paid by BSA from the
transfer price charged to BSA or otherwise reimbursed
BSA for those duties,” its determination that the reim-
bursement regulation did not apply was consistent with
previous cases and past practice. J.A. 27 (citing cases
where the agency clarified that “reimbursement, within
the meaning of the regulation, takes place between affili-
ated parties if the evidence demonstrates that the exporter
directly pays antidumping duties for the affiliated importer
or reimburses the importer for such duties”).
Following the agency’s final decision, U.S. Steel filed a
complaint in the United States Court of International
Trade challenging the decision. U.S. Steel Corp. v. United
States, 578 F. Supp. 3d 1323 (Ct. Int’l Trade 2022). The
trial court sustained the agency’s decision, finding that it
was supported by substantial evidence and was otherwise
in accordance with the law. Id. at 1325. The trial court
noted that “[t]he Exporter’s deduction of estimated anti-
dumping duties from the Importer’s invoice price, on its
own, is unremarkable when viewed in the context of the
record.” Id. at 1331. The court further explained that
“[t]ogether with the non-reimbursement evidence in the
form of the certificate filed by the Importer, and evidence
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UNITED STATES STEEL CORPORATION v. US 9
that the Importer paid duties owed on the subject steel, the
court concludes it was not unreasonable for Commerce to
find that the reimbursement regulation did not apply
here.” Id. The trial court also rejected U.S. Steel’s argu-
ment that the agency erred as a matter of law by failing to
apply its reimbursement regulation, stating, “Plaintiffs’ ar-
gument that Commerce unlawfully ignored its ‘practice’ of
considering the lowering of an invoice price to be ‘indirect
reimbursement’ under its regulations is meritless.” Id. at
1331–32. Like the agency, the trial court reasoned that in
previous cases concerning allegations of antidumping duty
reimbursement between affiliated parties, the agency has
required a showing of something more than a transfer of
funds between parties: there must be evidence that the ex-
porter directly paid the duties or reimbursed the importer
for such duties. Id. at 1332–33. The trial court then con-
cluded that because there was no evidence of such reim-
bursement—direct or indirect—it was “unconvinced by
Plaintiff’s argument that Commerce has departed from an
established practice.” Id. at 1333.
U.S. Steel now appeals. We have jurisdiction under 28
U.S.C. § 1295(a)(5).
II
We review the decisions of the Court of International
Trade de novo, applying the same standard of review used
by the trial court in reviewing the administrative record
before the agency. Boomerang Tube LLC v. United States,
856 F.3d 908, 912 (Fed. Cir. 2017). This court will uphold
the agency’s determination unless it is “unsupported by
substantial evidence on the record, or otherwise not in ac-
cordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i); Union
Steel v. United States, 713 F.3d 1101, 1106 (Fed. Cir. 2013).
A decision is supported by substantial evidence if the
evidence amounts to “more than a mere scintilla” and “a
reasonable mind might accept [it] as adequate to support a
conclusion.’” Ad Hoc Shrimp Trade Action Comm. v. United
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UNITED STATES STEEL CORPORATION v. US 10
States, 802 F.3d 1339, 1348 (Fed. Cir. 2015) (quoting Con-
sol. Edison Co. of N.Y. v. NLRB, 305 U.S. 197, 217 (1938)).
Our review “is limited to the record before Commerce in the
particular proceeding at issue and includes all evidence
that supports and detracts from Commerce’s conclusion.”
Id. Further, the Department of Commerce’s findings “may
still be supported by substantial evidence even if two in-
consistent conclusions can be drawn from the evidence.” Id.
III
On appeal, U.S. Steel argues that the trial court erred
in sustaining the agency’s finding that BlueScope did not
engage in antidumping duty reimbursement because such
a decision is not supported by substantial evidence. U.S.
Steel further argues that the agency erred as a matter of
law when it declined to apply its antidumping duty regula-
tion to the facts of the case. We disagree and hold that the
agency’s determination was supported by substantial evi-
dence and was otherwise in accordance with law.
During the review, the agency based its determination
on a number of record documents, including the nonreim-
bursement certificate filed by BSA, the Supply Agreement,
the sales trace of previous transactions amongst the par-
ties, and documents showing that BSA had paid the owed
duties to United States Customs and Border Protection.
The agency’s Final Decision Memorandum and the Final
Results Analysis Memorandum both demonstrate that the
agency had a clear understanding of BlueScope’s transfer
price methodology, including the ways that BlueScope fac-
tored estimated antidumping duties into its calculation.
See J.A. 26, 4103. Even after weighing this evidence, the
agency found that the transfer pricing methodology did not
constitute reimbursement. As the trial court explained, the
agency determined that “it would have been unreasonable
for the Exporter to include antidumping duties in the price
charged to the Importer because the Exporter itself was not
responsible for those duties.” U.S. Steel, 578 F. Supp. 3d at
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UNITED STATES STEEL CORPORATION v. US 11
1327. The record indicates that the evidence before the
agency was adequate to support the agency’s finding of
nonreimbursement. Furthermore, the fact that U.S. Steel
may be able to point to several instances in the record
where BlueScope submitted questionnaire responses that
could fairly be read to contradict its overall narrative re-
garding the Supply Agreement, see Reply Br. 2–3, is not
sufficient to render the agency’s decision unreasonable or
not based on substantial evidence.
Because we find that substantial evidence supports the
agency’s determination that BlueScope did not engage in
reimbursement, we are also not persuaded by U.S. Steel’s
argument that the agency erred as a matter of law in fail-
ing to apply its reimbursement regulation. Like the trial
court, in the absence of evidence demonstrating that BSA
was reimbursed for the duties it paid, we find no departure
from an established practice by the agency that would con-
stitute reversible error. See U.S. Steel, 578 F. Supp. 3d at
1333.
IV
We have considered the remainder of U.S. Steel’s argu-
ments and find them unpersuasive. Accordingly, we affirm
the Court of International Trade’s decision sustaining the
Department of Commerce’s determination that BlueScope
did not engage in antidumping duty reimbursement within
the meaning of the statute.
AFFIRMED
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