Ditar, S.A. v. United States

Slip Op. 26-114
UNITED STATES
COURT OF INTERNATIONAL TRADE
Court No. 24-00130
DITAR, S.A.,
Plaintiff,
v.
UNITED STATES,
Defendant,
and
COALITION FOR FAIR TRADE
IN SHOPPING BAGS,
Defendant-Intervenor.
Before: M. Miller Baker, Judge
OPINION
[Sustaining the Department of Commerce’s remand
results.]
Dated: September 15, 2026
Robert G. Gosselink, Jonathan M. Freed, Kenneth N.
Hammer, and MacKensie R. Sugama, Trade Pacific
PLLC, Washington, DC, on the comments for Plaintiff.
Rebecca T. Mitchell, Trial Attorney, Commercial Liti-
gation Branch, Civil Division, U.S. Department of Jus-
tice, Washington, DC, on the comments for Defendant.
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Ct. No. 24-00130 	Page 2
Of counsel for Defendant was Paul Thornton, Attor-
ney, Office of the Chief Counsel for Trade Enforcement
& Compliance, U.S. Department of Commerce, Wash-
ington, DC.
J. 	Michael 	Taylor 	and 	Daniel 	L. 	Schneiderman,
King & Spalding LLP, Washington, DC, on the com-
ments for Defendant-Intervenor.
Baker, Judge: This case involving an antidumping
duty investigation of paper bags imported from Colom-
bia returns from a court-ordered remand. See Ditar,
S.A. 	v. 	United 	States, 	Slip 	Op. 	25-128, 	2025 	WL
2795057 (CIT 2025) (Remand Op.). 1
Briefly summarized, Ditar, a Colombian producer,
sought a “level-of-trade” adjustment to its home-mar-
ket price for purposes of calculating its antidumping
margin. Commerce denied it, reasoning that “the com-
pany failed to demonstrate either a difference in the
level of trade in its home-market sales or any signifi-
cant effect on price comparability stemming from the
asserted disparity.” Id. at 10, 2025 WL 2795057, at *4.
Both are required under the statute. See id. at 3, 2025
WL 2795057, at *1 (citing 19 U.S.C. § 1677b(a)(7)(A)(i),
(ii)).
As to the first issue, the court remanded for the De-
partment to “review Ditar’s indirect selling expenses
and reconsider the company’s claims that intensity dif-
ferences 	in 	[warehousing 	and 	repacking 	expenses]
1 The court presumes the reader’s familiarity with its pre-
vious decision.
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Ct. No. 24-00130 	Page 3
show a difference in levels of trade.” Id. at 14–15, 2025
WL 2795057, at *6.
And for the second, the court instructed the agency
to justify its assertion that the pricing differential be-
tween Ditar’s distributor and end-user sales was not
“significant.” Id. at 20–22, 2025 WL 2795057, at *8.
On remand, Commerce provided additional reasons
for its finding that the company failed to show a differ-
ence 	in 	the 	level 	of 	trade. 	See 	Appx8696–8698;
Appx8705–8712. It declined to take up the pricing dif-
ferential question, reasoning that it was unnecessary
to decide in view of its disposition of the former issue.
Appx8698–8700; Appx8713–8716.
Ditar now challenges both aspects of the agency’s
redetermination.
I
There are two ways to establish different levels of
trade. The applicant may show either that the sales
were “made at different marketing stages” or that they
were 	made 	at 	the 	“equivalent” 	of 	such 	stages.
19 C.F.R. § 351.412(c)(2). The difference between “dif-
ferent marketing stages” and “the equivalent” is that
the former requires merchandise to change hands
twice, while the latter does not. See 62 Fed. Reg.
27,296, 27,371; see also Remand Op. at 4, 2025 WL
2795057, at **1–2. In either case, “[s]ubstantial differ-
ences in selling activities are a necessary, but not suf-
ficient, condition for determining that there is a differ-
ence.” 19 C.F.R. § 351.412(c)(2).
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Because Ditar admits that its Colombian sales did
not involve shopping bags changing hands twice, the
question is whether it showed “the equivalent” of dif-
ferent marketing stages. Remand Op. at 12, 2025 WL
2795057, at **4–5. To do that, it had to demonstrate
that it took on a role comparable to that of a reseller
by engaging in “an additional layer of selling activities,
amounting in the aggregate to a substantially differ-
ent selling function.” 62 Fed. Reg. at 27,371.
On initial review, the court sustained Commerce’s
finding that the record did not establish such substan-
tial 	differences 	in 	selling 	functions 	because 	Ditar
failed to show an intensity of sales functions and sup-
port out of proportion to the relative volume of the two
types of sales. Remand Op. at 13, 2025 WL 2795057,
at *5. But the company also argued that its warehous-
ing and repacking expenses for home-market end-user
customers were more intensive than they were for dis-
tributors, 	and 	it 	explained 	that 	it 	reported 	those
amounts as indirect selling expenses. Id. at 14–15,
2025 WL 2795057, at **5–6. The court remanded be-
cause, while the Department found fault with Ditar’s
inclusion of the expenses in the indirect category, the
government did not dispute that the company had
classified them properly. Id.
On remand, Commerce found that the warehousing
and repacking expense data on the record were inade-
quate to allow the agency “to further evaluate or cor-
roborate” Ditar’s claims that its end-user sales were at
a significantly higher intensity than its distributor
sales. Appx8696. While the supporting information
identified 	various 	subaccounts, 	none 	of 	them
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Ct. No. 24-00130 	Page 5
specifically reflected warehousing or repacking ser-
vices, and there was no transaction-specific detail sup-
porting an evaluation of the total expenses incurred.
Appx8696–8697. And there was no detail about spe-
cific transactions to corroborate Ditar’s assertion that
the expenses were incurred only for end-user sales,
much less at the reported intensity. Appx8697.
The Department acknowledged that the lack of de-
tail was not the company’s fault, observing that indi-
rect selling expenses are, by definition, indirect. Id.
That is, the problem was not with the reporting itself.
Rather, it was because indirect selling expenses are
“allocated to all sales regardless of channel” of sale,
such that “their inclusion detracts from Ditar’s ability
to substantiate the claims regarding the applicability
of these sales functions to only one channel and the
intensity 	level 	claimed.” 	Appx8697–8698. 	In 	other
words, the non-specific nature of indirect selling ex-
penses meant they failed to support the company’s
claims.
Ditar argues that the Department failed to explain
why the warehousing and repacking services do not
support finding different levels of trade. ECF 50, at 19.
But as the party seeking a level-of-trade adjustment,
it had the burden of “demonstrat[ing] the appropriate-
ness of such adjustment.” Statement of Administrative
Action Accompanying the Uruguay Round Agreements
Act (SAA), H.R. Doc. 103–316, vol. 1, at 829, 1994
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U.S.C.C.A.N. 4040, 4216. 2 Ditar appears to presume
that it should receive an adjustment unless the agency
proves otherwise.
In any event, the company also argues that its
questionnaire responses establish that it performed
“numerous additional selling functions for end user
customers” that it did not perform for distributors and
that it properly reported them as indirect selling ex-
penses 	based 	on 	the 	questionnaire’s 	instructions.
ECF 50, at 19–20. As to the latter point, Commerce
agreed that the reporting was proper. See Appx8697
(“That these claimed expenses cannot be identified
does not undermine the indirect selling expenses re-
porting.”) (emphasis added).
But as to the former, the Department found no evi-
dence in the record to substantiate Ditar’s claim that
it performed “numerous additional selling functions”
for 	the 	end 	users. 	This 	is 	why, 	according 	to 	the
agency’s reasoning, the indirect selling expenses are
problematic—not because it was wrong to include var-
ious amounts in that category, but because “indirect”
expenses apply “to all sales regardless of channel.”
Appx8697–8698 (emphasis added). Commerce’s point
was that indirect selling expenses by their nature can-
not corroborate, or “inform consideration of,” the com-
pany’s claim about the intensity levels of its sales
2 The SAA “shall be regarded as an authoritative expres-
sion by the United States concerning the interpretation of
the Uruguay Round Agreements and this Act in any judi-
cial proceeding in which a question arises concerning such
interpretation or application.” 19 U.S.C. § 3512(d).
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activities or whether the transactions were at different
levels of trade. Appx8698.
Ditar repeatedly protests that it did not perform
various selling activities at all for home-market dis-
tributor customers. See ECF 50, at 19, 20, 23, 24–25.
It fails, however, to respond to Commerce’s conclusion
that the indirect sales expenses do not “substantiate
the claims regarding the applicability of these sales
functions to only one channel.” Appx8697. In other
words, the Department found the record did not sup-
port the company’s underlying claim. The government
puts it well: “In essence, although Ditar claims that its
warehousing and repacking services were only pro-
vided to end users . . . , Commerce reviewed the record
to see if that claim was supported and, based on the
account information, determined that it was not.” 3
ECF 57, at 21 (emphasis added).
That alone is reason to sustain the remand results.
The company makes several arguments based on other
record evidence, including internal correspondence,
that it calls “source documentation.” 	See 	ECF 50,
at 21–23. But the court directed the Department to “re-
view Ditar’s indirect selling expenses and reconsider
3 Viewed differently, Ditar’s theory seems to be that it is a
given that the services were provided only to end users
simply because it says so. As a result, the apparent argu-
ment goes, any level of such services is at a higher level of
intensity when compared to zero. The entity seeking the
adjustment, however, must prove the nature of its sales ac-
tivity. See SAA at 829, 1994 U.S.C.C.A.N. at 4168. The
agency’s point is that the record does not substantiate the
company’s assertion.
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the company’s claims that intensity levels in these two
categories show a difference in levels of trade.” Re-
mand Op. at 14–15, 2025 WL 2795057, at *6. That’s
what the agency did.
And while the company claims that it was “errone-
ous” for Commerce to focus on its accounting system,
ECF 50, at 21, the Department correctly observed (see
Appx8707–8708) that its instructions on remand were
to reconsider the warehousing and repacking expenses
reflected in that system. Remand Op. at 14, 2025 WL
2795057, at *6 (“As the government does not contest
that Commerce simply misunderstood its own data re-
porting requirements for repacking and warehousing
expenses, remand is necessary.”) (emphasis added).
In sum, the Department’s conclusion that Ditar
failed to establish that its home-market sales to its two
types of customers (distributors and end users) were
made at different levels of trade is supported by sub-
stantial evidence, so the court sustains it.
II
In its original decision, the court observed that the
agency found the price differential between distributor
and end-user sales “insufficient” to warrant a level-of-
trade adjustment but neither explained why nor re-
sponded to Ditar’s argument that the difference was
significant. 	See 	Remand 	Op. 	at 	21–22, 	2025 	WL
2795057, at *8. The court remanded “to allow the
agency to connect the dots,” 	id., which in context
meant it needed to “articulate a satisfactory explana-
tion . . . including a rational connection between the
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facts found and the choice made,” id. (quoting Motor
Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut.
Auto. Ins. Co., 463 U.S. 29, 43 (1983)).
In response, Commerce explained that the statute
imposes two prerequisites for a level-of-trade adjust-
ment. There must be a difference in level of trade that
involves the performance of different selling activities.
Appx8698; 19 U.S.C. § 1677b(a)(7)(A)(i). The differ-
ence, 	in 	turn, 	must 	affect 	price 	comparability.
Appx8698; 19 U.S.C. § 1677b(a)(7)(A)(ii).
The Department observed that “the record does not
reflect that Ditar’s sales are made at different market-
ing stages nor are there substantial differences in sell-
ing activities.” Appx8700. “Because Ditar failed to es-
tablish one of two statutorily required criteria for [a
level-of-trade] adjustment, even if Commerce were to
agree with [the company] on the issue of price compa-
rability, [it] could not lawfully grant” the adjustment.
Appx8715–8716. In other words, because Ditar could
not establish that its home-market sales to its two
types of customers were made at different levels of
trade, the price-differential issue was irrelevant.
The company argues that the Department failed “to
provide a meaningful or satisfactory answer to the
Court’s question and instructions.” ECF 50, at 11. It
asserts that the agency was obligated to address the
price differential’s significance.
The government answers that Commerce did ad-
dress 	the 	issue 	by 	explaining 	why 	the 	price-
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Ct. No. 24-00130 	Page 10
differential question was irrelevant. ECF 57, at 34 (cit-
ing Appx8715–8716).
The court agrees with the government. Because the
Department reasonably explained that Ditar failed to
show two levels of trade, it was unnecessary for the
agency to decide whether the price differential was sig-
nificant. As the court observed in its initial decision,
the company had the burden to demonstrate both “a
difference in the level of trade” and that such “differ-
ence has an effect on the comparability of prices.” Re-
mand Op. at 5, 2025 WL 2795057, at *2 (quoting
19 C.F.R. § 351.412(a)). Ditar having failed to satisfy
the first of those requirements, the agency reasonably
declined to consider the second.
Under these circumstances, it would be pointless
for the court to require the agency to address the price
differential. In military terms, it would be overkill.
“The law does not require a vain and useless thing
. . . .” McMicking v. Shields, 238 U.S. 99, 103 (1915).
* 	* 	*
For these reasons, the court sustains Commerce’s
redetermination. A separate judgment will issue. See
USCIT R. 58(a).
Dated: 	September 15, 2026 	/s/ M. Miller Baker
New York, NY 	Judge
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