Hyundai Heavy Industries Co., Ltd. v. United States

Slip Op. 21-84
UNITED STATES COURT OF INTERNATIONAL TRADE
HYUNDAI HEAVY INDUSTRIES CO., LTD.,
Plaintiff,
and
HYOSUNG CORPORATION AND ILJIN
ELECTRIC CO., LTD.,
Consolidated Plaintiffs,
v.
UNITED STATES,
Defendant,
and
ABB ENTERPRISE SOFTWARE INC.,
Defendant-Intervenor.
Before: Mark A. Barnett, Chief Judge
Consol. Court No. 18-00066
OPINION
[Sustaining the second remand redetermination in the fourth administrative review of the
antidumping duty order on large power transformers from the Republic of Korea.]
Dated: July 9, 2021
David E. Bond, William J. Moran, and Ron Kendler, White & Case LLP, of Washington,
DC, for Plaintiff Hyundai Heavy Industries Co., Ltd.
J. David Park, Henry D. Almond, Daniel R. Wilson, and Leslie C. Bailey, Arnold & Porter
Kaye Scholer LLP, of Washington, DC, for Consolidated Plaintiff Hyosung Corporation.
Kelly A. Krystyniak, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, of Washington, DC, for Defendant United States. With her on
the brief were Brian M. Boynton, Acting Assistant Attorney General, Jeanne E.
Davidson, Director, and L. Misha Preheim, Assistant Director. Of counsel on the brief
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was David Richardson, Senior Counsel, Office of the Chief Counsel for Trade
Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.
R. Alan Luberda, David C. Smith, and Melissa M. Brewer, Kelley Drye & Warren LLP, of
Washington, DC, for Defendant-Intervenor ABB Enterprise Software Inc.
Barnett, Chief Judge: This matter is before the court following the U.S.
Department of Commerce’s (“Commerce” or “the agency”) second remand results in the
fourth administrative review (“AR4”) of the antidumping duty order on large power
transformers from the Republic of Korea. See Confidential Final Results of
Redetermination Pursuant to [Second] Court Remand (“Second Remand Results”), ECF
No. 154-1. 1 Plaintiff Hyundai Heavy Industries Co., Ltd. (“HHI”),2 and Consolidated
Plaintiffs Hyosung Corporation (“Hyosung”), and Iljin Electric Co., Ltd. (“Iljin”) each
challenged aspects of Commerce’s final results in the fourth administrative review of the
antidumping duty order on large power transformers from the Republic of Korea. See
Large Power Transformers From the Republic of Korea, 83 Fed. Reg. 11,679 (Dep’t
Commerce Mar. 6, 2018) (final results of antidumping duty admin. review; 2015–2016)
(“Final Results”), ECF No. 19-5, and accompanying Issues and Decision Mem., A-580-
867 (Mar. 9, 2018), ECF No. 19-6. The court has issued two opinions resolving
substantive issues raised in this case; familiarity with those opinions is presumed. See
Hyundai Heavy Indus. v. United States (“HHI (AR4) I”), 43 CIT ___, 393 F. Supp. 3d
1 The administrative record associated with the Second Remand Results is divided into
a Public Remand Record, ECF No. 156-3, and a Confidential Remand Record, ECF No.
156-2.
2 Hyundai Electric & Energy Systems Co., Ltd. is the successor-in-interest to HHI.
Letter from David E. Bond, Att’y, White & Case LLP, to the Court (Sept. 12, 2018), ECF
No. 32.
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1293 (2019); Hyundai Heavy Indus. v. United States (“HHI (AR4) II”), 44 CIT ___, 485
F. Supp. 3d 1380 (2020).
Briefly, HHI (AR4) I remanded Commerce’s Final Results for further explanation
or reconsideration regarding Commerce’s reliance on total adverse facts available (or
“total AFA”) for both HHI and Hyosung. 393 F. Supp. 3d at 1322. With respect to HHI,
and relevant to this discussion, the court found that substantial evidence did not support
Commerce’s reliance on total AFA based on HHI’s reporting of accessories. See id. at
1313–17. While the court found that substantial evidence supported Commerce’s
conclusion that the record was ambiguous as to whether HHI reliably and accurately
reported home market gross unit prices, the court directed Commerce to revisit this
issue on remand because it appeared to be related to the accessories issue. See id. at
1317–18. With respect to Hyosung, and relevant to this discussion, the court could not
ascertain Commerce’s reasoning for finding that a certain invoice series that covered
multiple sales across separate review periods was unreliable and found that Commerce
failed to support its finding that certain price adjustments and discounts constituted
grounds for total AFA. See id. at 1308–12.
In the first remand redetermination, with respect to HHI, Commerce concluded
that the application of total AFA with respect to accessories was no longer warranted.
See Confidential Final Results of Remand Redetermination Pursuant to [First] Court
Remand (“First Remand Results”) at 15–16, ECF No. 91-1. However, Commerce
continued to rely on total AFA because HHI understated its home market gross unit
prices by failing to consistently report certain parts in home market sales as foreign like
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product. See id. at 16–19. With respect to Hyosung, Commerce determined that
Hyosung did not act to the best of its ability when it failed to provide complete and
accurate information concerning its sales adjustments and discounts for U.S. sales.
See id. at 15. While Commerce explained that Hyosung’s use of one invoice for
multiple sales no longer warranted using total AFA, the unreported discounts and price
adjustments continued to warrant the use of total AFA. See id. at 11–13.
In HHI (AR4) II, the court again remanded Commerce’s reliance on total AFA for
HHI and Hyosung. 485 F. Supp. 3d at 1403–04. Regarding HHI, the court reasoned
that Commerce’s decision to disregard HHI’s entire home market sales database and
rely on total facts otherwise available was not supported by substantial evidence
because Commerce failed to address whether HHI’s home market sales information
met the criteria set forth in 19 U.S.C. § 1677m(e) to be used despite not meeting all of
Commerce’s requirements. See id. at 1399–1400. Moreover, Commerce did not
adequately support its use of an adverse inference because the agency merely restated
its reasons for relying on neutral facts available. See id. at 1400–01. Regarding
Hyosung, the court found that Commerce did not sufficiently support its reliance on total
AFA because the agency did not explain why it was impracticable to issue a
supplemental questionnaire after discovering Hyosung’s reporting deficiencies with
respect to discounts and price adjustments for U.S. sales. See id. at 1391–92; see
generally 19 U.S.C. § 1677m(d).
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In the redetermination at issue here, Commerce, under respectful protest,3 see
Second Remand Results at 11, 14, applied partial facts available, without an adverse
inference, to determine a zero percent antidumping duty rate for both HHI and Hyosung,
see id. at 24. With respect to HHI, Commerce determined that HHI understated the
gross unit price for a home market sale in which it treated a certain part as non-foreign
like product, whereas it had treated the same part as foreign like product in another
home market sale. See id. at 14–15. With respect to Hyosung, Commerce relied on
partial facts available, without an adverse inference, “for the discount for the sales for
which there is record evidence of discounts.” Id. at 11. Commerce further explained
that Hyosung’s failure to accurately report certain price adjustments to U.S. sales also
warranted reliance on partial facts available without an adverse inference. See id.
Before the court, Defendant-Intervenor ABB Enterprise Software Inc. (“ABB”)
opposes the Second Remand Results because, in ABB’s view, the court did not
properly apply the standard of review in HHI (AR4) I and HHI (AR4) II. See [ABB’s]
Cmts. in Opp’n to Commerce’s Second Remand Redetermination (“ABB’s Cmts.”) at 8,
ECF No. 157. Consequently, ABB contends, the Second Remand Results are invalid,
and the Final Results should be reinstituted without regard to the remand
redeterminations. See id. HHI, Hyosung, and Defendant United States (“the
Government”) urge the court to sustain Commerce’s Second Remand Results in full.
See Pl.’s Responsive Cmts. in Supp. of the Final Results of Redetermination Pursuant
3 By making the determination under protest, Commerce preserves its right to appeal.
See Viraj Grp., Ltd. v. United States, 343 F.3d 1371, 1376 (Fed. Cir. 2003).
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to Court Remand at 5, ECF No. 158; Def.’s Resp. to Cmts. on Remand Redetermination
at 5, ECF No. 159; Hyosung’s Cmts. in Supp. of Second Remand Results (“Hyosung’s
Cmts.”) at 12, ECF No. 160.
For the reasons discussed herein, the court sustains Commerce’s Second
Remand Results. 4
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), 5 and 28 U.S.C. § 1581(c)
(2018). The court will uphold an agency determination that is supported by substantial
evidence and otherwise in accordance with law. 19 U.S.C. § 1516a(b)(1)(B)(i). “The
results of a redetermination pursuant to court remand are also reviewed for compliance
with the court’s remand order.” Solar World Ams., Inc. v. United States, 41 CIT ___,
4 Iljin challenged Commerce’s determinations in the Final Results and the First Remand
Results to calculate its rate (i.e., the rate for non-individually examined respondents) by
averaging the total AFA rates determined for the mandatory respondents. See HHI
(AR4) II, 485 F. Supp. 3d at 1402–03; HHI (AR4) I, 393 F. Supp. 3d at 1321. The court
deferred ruling on Iljin’s challenge pending Commerce’s redetermination in the event it
became moot. See HHI (AR4) II, 485 F. Supp. 3d at 1403; HHI (AR4) I, 393 F. Supp.
3d at 1321. In the Second Remand Results, Commerce calculated zero percent
margins for both mandatory respondents and applied this rate to Iljin. Second Remand
Results at 24. Iljin does not challenge the Second Remand Results.
5 All citations to the Tariff Act of 1930, as amended, are to Title 19 of the U.S. Code,
and references to the U.S. Code are to the 2018 edition unless otherwise stated.
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___, 273 F. Supp. 3d 1314, 1317 (2017) (quoting Xinjiamei Furniture (Zhangzhou) Co.
v. United States, 38 CIT ___, ___, 968 F. Supp. 2d 1255, 1259 (2014)).
DISCUSSION
ABB’s opposition to the Second Remand Results is based on its disagreement
with the court’s prior opinions in this proceeding. See ABB’s Cmts. at 8. ABB raises no
specific arguments challenging the Second Remand Results that the court has not
addressed in those prior opinions; rather, ABB seeks to preserve its “appellate rights.”
Id. at 2. ABB has not, however, provided any reason for the court to revisit its findings
in HHI (AR4) I and HHI (AR4) II. See id. (acknowledging that the court “will likely affirm
the Second Remand [Results] based on Commerce following the Court’s direction in
[HHI (AR4) II]”).
Commerce’s redetermination complies with the court’s order in HHI (AR4) II
because it supplied reasoned explanations for its reliance on partial facts otherwise
available to determine HHI’s and Hyosung’s 6 margins. 7 See Second Remand Results
at 9–14.
6 While Hyosung “disagrees with Commerce as to whether the documentation on the
record indicates that a discount applied to one specific sale,” it does not challenge that
determination before the court. Hyosung’s Cmts. at 3 n.1.
7 Commerce states that in HHI (AR4) II the court found “that [HHI] acted to the best of
its ability” to respond to Commerce’s request for information regarding HHI’s treatment
of certain parts as foreign like product in home market sales. Second Remand Results
at 13 & n.65 (citing HHI (AR4) II, 485 F. Supp. 3d at 1399–1400). The court made no
such finding. The court concluded that “the record [did] not support Commerce’s
characterization of HHI’s reporting errors as sufficient to warrant an adverse inference.”
HHI (AR4) II, 485 F. Supp. 3d at 1401 (emphasis added). And while the “record
indicate[d] that HHI did not report [the parts at issue] as foreign like product in the two
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CONCLUSION
In accordance with the foregoing, the court will sustain the Second Remand
Results. Judgment will enter accordingly.
/s/ 	Mark A. Barnett
Mark A. Barnett, Chief Judge
Dated: __July 9, 2021_____
New York, New York
sales at issue based on its good faith position on an issue about which even Commerce
previously acknowledged ambiguity,” id., the court did not constrain Commerce from
relying on total AFA for HHI if such a determination was supported by substantial
evidence and in accordance with the law.
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