Slip Op. 09-74 UNITED STAT ES COURT OF INTERNATIONAL TRADE

____________________________________ : UNI TED STATES STEEL : CO RPO RA TI ON , : : Plaintiff, : : an d : : NUCOR CORPORATI ON, : GAL L ATI

N STEELCOMPANY, : SSAB NORTH AMERI CAN DIVI SI ON, : STEELDYNAMI CS I

NC., and : ARCEL ORMI TTAL

USA, I NC., :

: Before: Judith M. Barzilay, Jud ge Pla int if f- Inte rv e no rs , : Consol. Court No. 07-00170

: v . : : UNI TED STATES, : : De fe nd ant, : : an d : : CORUS S TAAL

BV , : : Def endant- Interve nor. : : ____________________________________:
OP IN ION [P laintiff’s and Plaintiff- Interve nors’ Motions for Judgment Upon the A g ency Record a re denied.] Dated: July 20, 2009Consol. Court No. 07-00170 P age 2

Commerce twic e dela

y ed the implementation of the Section 123 De termination , with the 1 chang e in policy

ultimately

taking eff

ect on F ebrua

ry 22, 2007. Se e An tid

um ping Pro c e e dings : Calculation of

the W eighted-Av erage D umping Margins in Antidumping Investigations; Change in Effective D ate of Final Modification , 72 Fe d. Reg . 1,704, 1,704 (De p’t Commerce J an. 16, 20 07 ); Antidumping Pr oc e e dings : C alc ula tio n o

f th e W e igh te d- Av e rageDu mp ing

Ma rg ins in Antidumping Investigations; Change in EffectiveDate of Final Modification , 72 Fe d. Reg . 3,783, 3,783 (De p’t Commerce J an. 26, 2007). Skadden A rps Slate Meaghe r &Flom, LLP ( Robert E. Lighthizer, Jeffrey D. G errish, Ellen J. Schneide r, and Luke A. Me isner), for Plaintiff United States Steel Corporation. W iley Re in (

Alan H. Price and Tim oth yC. B rig htb ill), for

Plaintiff-Interve nor Nuc or Corporation

. Sc hagr in A sso c iates (

Roger B. Sc hagrin and Mi c ha e l J . B ro wn ), fo r P la int if

f- Inte rv e no rs Ga llatin Steel Company , SSAB North Amer ican Division, and Steel Dy namics Inc. Ste war t an d S

te war t ( Te re nc e P. Ste war t and W ill iam A. Fe nn e ll), for

Plaintiff-Interve nor Arc elorMittal USA, Inc. Ton yW est , A ssi sta

nt A tto rn e y

Ge ne ra l; JeanneE. Davidson , D ir e c tor ; Patricia M. McCarthy , Assistant Director , Commercial L itigation B ranc h, Civil Division, United St ates De partment of J ustice ( Claudia Burke ); Sapna Sharma , Offic e of the Chief Counsel for Import Administration, Un ite d St a te s D e pa

rtme nt o f C omm e rc e , O f C ouns e l, f or De fe nd ant Unit e d St a te s. Steptoe &Johnson LLP ( Richard O. Cunningham, Joe l D. Kaufman, Alice A. Kipel , and J am ie B. Beabe r ), for

Def endant- Interve nor Corus Staal B V.
BA RZ ILA Y, JU DG E: In Dec ember 2006, the U.S. Depa

rtment of Commerce (“Commerc e”) deter

mined that it would apply a new methodology

to calculate the we ighte daver ag e dumping marg ins in certain investig ations. See Antidumping Procee dings: Calculation of the W eighted-Av erage D umping Margin During an Antidumping Investigation; Final Modification , 71 Fe d. Reg . 77,722, 77,722 (De p’t Commerce Dec . 27, 2006) (“ Section 123 Determ ination ”). Plaintiff United States Steel Corporation (“ U.S. Steel”), a long w ith other 1Consol. Court No. 07-00170 P age 3

Nucor Corporation (“Nucor ”), G allatin Steel Company , SSAB North Amer ican 2 Division, and Steel Dy

namics, Inc. (tog ether , “Ga llatin”), as we ll as Arce lorMittal USA, I nc. (“ Ar c e lorMitta l” ) ( c oll e c tiv e ly , “ Pla int if f- Inte rv e no rs ” ), joi n th is a c tio n p ur su ant t o U SCI T R. 24. Corus Staal BV ( “Corus”) is a defe ndant-interve nor her e under the same r

ule. Implem entation of the Findings of t he W TO Panel in US–Zeroing ( EC) : Notice of 3 Determ inations Under Section 129 of the Uruguay Round A greem ents Act and Re vocations and Pa rti al R e v oc ati on s o

f Ce rta in A nti du mp ing

Du ty Or de rs , 72 Fe d. Reg . 25,261, 25,262 (De p’t Commerce Ma

y 4, 2007) (“ Section 129 De termination ”). Z eroingand off

setting a re diff ere nt methodologies use d to determine the weig hted- 4 aver ag e dumping marg in. Offse tting is the pra ctice where by Commerce, when ca lculating the numerator in the weig hted-avera g e dumpingequation, off sets sales made at less than fa ir value wi thfa i r v al u e s al es . Zer o i n g i s a p ra ct i ce th ati s re l at edt o – b u td i s t i n ctfr o m–

o ff s et t i n g, wher eby Commerce g ives the sales ma rg ins of merc handise sold at or a bove fa ir value pr ices a

n assumed value of zero. See Corus Staal BV v. De p’t of Commerce , 395 F.3d 1343, 1345- 46 (F ed. Cir. 2005). With z eroing , Commerce use s only the sales mar g ins of merc handise sold at less than fa ir value pr ices to ca lculate the f inal weig hted-avera g e dumping marg in. Se e id
. Whil e U.S. Steel cha lleng ed Commerce ’s dec ision not t o consider its cla im of targ eted 5 dumpi ngin t

he Se c tio n 1 29 a dmi nis tr a tiv e pr oc e e din g , it do e s n ot d o s o h e re in e ith e r i ts complaint or in its briefingand ther eby waives its rig ht to challeng e that compone nt of Comme rc e ’s Section 129 De termination
. i n t er es t edd o m es t i c p art i es , ch al l en ge t h atd et erm i n at i o ni na p art i cu l ar S ec t i o n1 2 9 p ro ce ed i n g, 2 3
c la imi ngtha

t th e us e of

of fs e tti ngand

the e lim inatio n o f ze ro ingis n ot i n a c c or da nc e wi th antidumping law
. Plaintiff and Plaintiff-Interve nors also alleg e that Commerce ’s application of 4 the methodolog y

outlined in the Section 123 De termination to rea ch the f inal results of the Section 129 De termination was not in ac corda nce w ith law. Finally , Plaintiff-Interve nors Nucor and Ar celorMittal argue that Commerce err ed whe n it declined to consider their cla ims of targ eted dumpingin the Section 129 De termination
. For the re asons stated be low, the cour t 5 reje cts all three claims in Plainti ff’ s and Plaintiff-Interve nors’ Motions for Judgment Upon the Ag e nc y Re c or d a nd , th e re fo re , d e nie s th e mot ion s a nd g ra nts jud g me nt t o th e Go ve rnme nt.Consol. Court No. 07-00170 P age 4

The dumpingmarg in (“DM” ) is expressed func tionally as DM = N V - (E P or CEP). 6 The NVis the price c harg ed for the subject mer chandise in the home marke t, an appr opriate third country marke t price, or

the cost of pr oduction of the g oods subject to statutorily permitted adjustments. 19 U.S.C. § 1677b(a)(1) (B )(i)- (ii), (a )(4) . The EP is the price at which the subje ct merc handise is sold by

the produc er or

exporter to an unaf

filiated purc haser

in the U.S. or for e xpor tatio n to the U. S. 1 9 U .S. C. § 16 77 a (a ). Ho we ve r, if the fo re ig n p ro du c e r o r e xpor te r i s I. Bac kgr ound A. The P ur pos e of t he Ant idum ping Laws a nd t he We igh te d- Av e r ag e Dum ping M ar gin T h e c en tra l ai mo f t h e a n t i d u mp i n g l aw s i s t o p ro t ec td o m es t i c i n d u s tri es fr o mfo re i gn manufa cture d g oods that are sold injuriousl y in the United States at price s below the fa ir marke t value of those g oods in their home marke t. See Sango I nt’l, L.P. v. United States , 484 F.3d 1371, 13 72 (F e d. Cir . 2 00 7) . T he anti dumpi nglaws are no t pu nit ive in n a tur e , b ut r a the r, are me ant t o

“ re me dy dis pa ri tie s in the va lue of

imp or te d a nd do me sti c me rc ha

nd ise c re a te d b y

imp e rm iss ibl e international tra de pra ctices.” Bethlehe m Steel Corp. v. United States , 2 5 C I T 9 30 , 9 33 , 1 62 F. Supp. 2d 639, 643 (2001). The a pplication of antidumping principles should level the pla ying fi e ld b e tw e e n f

or e ig n a nd do me sti c manu fa c tur e rs of lik e me rc ha

nd ise and no t g ive an unf

a ir advanta g e to the domestic industry
. See P eer Be aring Co. v. United States , 25 CI T 1199, 1221, 182 F. Supp. 2d 1285, 1310 (2001). Comme rc e is r e qu ir e d to imp os e an a nti dumpi ngduty

or de r o n im

po rt e d me rc ha

nd ise that (1) is sold in the U.S. below its fair va lue and ( 2) mater ially injures or thre atens to injure a d o m e s t i c i n d

u s tr y. 19 U. S.C. § 1 67 3. Th e de te rm inatio n o f whe the r t he su bje c t im po rt s a re so ld at less than fa ir value involves a two-step proc ess, wher eby Commerce must first ca lculate the “dumping marg in” – the amount by which “the normal value [(“NV”) ] ex cee ds the export price [(“ EP” )] o r c on str

uc te d e xpor

t pr ic e [(“ CEP ” )] o f t

he su bje c t me rc ha

nd ise .” 19 U. S.C.

6Consol. Court No. 07-00170 P age 5

aff iliated with the importer of the subject merc handise, then a CEP may

be used. § 1677a (a) -(b)
. Th e CEP is the pr ic e , a s a dju ste d p ur su ant t o § 16 77 a (c )- (d ), a t w hic h th e su bje c t me rc ha

nd ise is first sold in the U.S. to a buy er una ffiliated with the pr oducer or exporter. § 1677a (b). § 1677(35)( A). I f the pric e of a g ood in the home marke t (NV) is g reater than the price for the same g ood in the U.S. (EP or CEP), then the dumping ma rg in comparison produc es a positive number indicating that dumpinghas occ urre d. In contra st, when the pric e cha rg ed for the subject
merc handise in the U.S. (EP or CEP) is g reater than that char g ed for the same me rcha

ndise in the ho me mark e t (NV ), the dumpi ngmarg in c a lc ulatio n yie lds a ne g a tiv e va lue , s ho wi ngtha t th os e sales we re ma de fa irly
. T h e s ec o n d

s t ep o f t h e p ro ce s s re qu i re s C o m m er ce t o d et erm i n e t h e w ei gh t ed -a v er age dumping mar g in, which expresses the dumpingmarg in as a pe rce ntag e and is de termined by div idi ngthe a g g re g ate dumpi ngmarg ins of a sp e c if ic e xpor te r o r p ro du c e r b y

the a g g re g a te export or constructed e x port price s of that same e x porter or produce r. § 1677(35) (B ). I mportantly , under Commerc e’s ne w methodolog y of off setting, the numerator in the weig htedave ra g e dumpi ngmarg in c a lc ulatio n is the a g g re g a te of a ll d ump ingmarg ins ( i.e. , those that have bo th p os iti ve and

ne g ativ e va lue s) . U nd e r t he pr e vio us ly

e mpl oy e d ze ro ingme tho do logy , th os e dumping mar g ins with a neg ative value wer e g iven an a ssumed value of zero. A we ighte daver ag e dumping marg in that yields a positive value de monstrates, on the whole , that the subject
merc handise wa s dumped in the United States. I f the International Trade Commi ssion (“I TC”) finds that the dumpe d subject
m e r c h an d i s e c a

u s e s th e d o m e s t i c i n d

u s tr y t o s u f f e r m a t e r i a l i n

j ur y o r th r e a t e n s m a t e r i a l i n

j ur y, then Commerce must iss ue an a ntidumping duty

order cover ing e ntries of the subjec tConsol. Court No. 07-00170 P age 6

merc handise. 19 U.S.C. § 1673. The a ntidumping duty

imposed on entries of the subject
merc handise is equa l in amount to the weig hted-avera g e dumping marg in. §§ 1673, 1677(35)( A)-( B)
. B. Sections 123 and 129 of the Uruguay Roun d Agree m ents Act Congr ess established two pr ocedur es by which an a dverse decision fr om the World Trade Or g anizatio n ( “ WTO ” ) D isp ute Se ttl e me nt P ane l or Ap pe llate B od

y may be imp le me nte d into domestic law – Sec tions 123 and 129 of the Ur ug uay Round Ag ree ments Act (“ URAA”)
. A Se c tio n 1 23 de te rm inatio n ame nd s, re sc ind s, or mod if ie s a n a g e nc y re g ulatio n o r p ra c tic e that is found to be inconsistent with any of the Ur ug uay Round Ag ree ments. 19 U.S.C. § 3533(g) (1). This scheme r equire s the United States Tra de Repre sentative (“ USTR”), an of ficial of the Ex ecutive B ranc h, to consult with the appropriate congressional a nd private se ctor a dvisory committees, and to provide a n opportunity

for public c omment before deter mining whe ther a

nd how to implement the ag ency regulation or prac tice at issue. Id . The USTR, as par t of the consultation proce ss, is required to provide the re levant congressional c ommitt ees w ith a repor t that descr ibes the propose d modification, the re asons for the modification, and a summary of the advice obtained fr om the private se ctor a dvisory committees. § 3533(g )(1) (D). T he fina l modification takes e ffe ct when it is published in the Fe dera l Reg ister. § 3533(g )(1) (F ). The sec ond proce dure – a Section 129 deter

mination – amends, resc inds, or modifies the application of a

n ag ency regulation or prac tice in a spe cific a ntidumping, counter

vailing duty , or safe g uards pr ocee ding tha t is found to be inconsistent with U.S. obli g ations under the WTO Antidumping Ag ree ment (“ AD Agree ment ”), the Ag ree ment on Subsidi es and Counter vailingConsol. Court No. 07-00170 P age 7

Me a sure s, or

the Sa fe g ua

rd s A g re e me nt. 19 U. S.C. § 3 53 8( a )( 1) , ( b) (1 ). He re , th e UST R mu st consult with the releva

nt cong ressional c ommitt ees a nd reque st in writing that the pe rtinent ag ency issue a new

deter mination consistent with the findings set for th in the WTO P anel or Ap pe llate B od

y Re po rt . §§ 35 38 (a )( 1) , ( a )( 3) -( 5) , ( b) (1 )- (3 ). Inte re ste d p art ie s ma y a lso su bmi t written comments on the pr oposed modification and, where appropr iate, ask f or an a dminist rative he ari ngon

the matte r. § 3 53 8( d) . ASe c tio n 1 29 de te rm inatio n ta ke s e ff e c t on or a ft e r t he date on which the USTR direc ts the ag ency to implement the determination in whole or in pa rt. § 3538(c) (1). Commerc e must also publish the determination in the Fe dera l Reg ister to provide notice of the ag ency

action to intere sted parties. § 3538(c) (2). C. The Original Antidu m pin g Duty Order & Sub sequent Developm ents On Novembe r 29, 2001, af ter the I TC had deter

mined that the subject imports injured the domestic industry , Commerce issued a n antidumping duty

order cover ing hot- rolled ca

rbon steel flat produc ts from the Ne therlands. See A ntidumping Duty Order: Certain Hot-Rolled Carbon Steel Flat Products From the Nethe rlands , 66 Fe d. Reg . 59,565, 59,566 (De p’t Commerce Nov. 29, 2001). Commerce used zeroingto calculate the fina l dumping mar g in for the subjec t
merc handise, findinga dumping marg in of 2.59% for the sole re spondent Corus. See id.; Notice of Final Determination of Sales at L ess Than Fair Value; Certain Hot-Rolled Carbon Steel Flat Products From The Netherlands , 66 Fe d. Reg . 50,408, 50,409 (De p’t Commerce Oct. 3, 2001); Issues and De cision Memorandum for the Antidumping Investigation of Certain Hot-Rolled Carbo n S te e l F lat Pr od uc ts f ro m t heNe the rla nd

s; Not ic e of F

ina l D e te rm ina tio n o

f Sa le s a t Le ss Than Fair Value (

A-421-807) , A-421-807 ( Oct. 3, 2001), available at 2001 WL1168309, at *6-Consol. Court No. 07-00170 P age 8

A law, r egulation, or measur e of a WTO Member that violates a WTO ag ree ment “as 7 such” me ans that the “ Member’ s conduct – not only in a par ticular instance that has occ urre d, but in future situations as we ll – will necessar ily be inconsistent with that Member’ s WTO obligations.” Appellate B ody Report, United States – Sunset Rev iews of Anti-Dumping Measures on Oil Country Tubul ar Goods from Argentina , ¶ 1 7 2 , W T / D S 2 6 8 / A B / R

(N o v . 2 9 , 2 0 0 4 )
. In contra st, a law, re g ulation or measur e that violates a WTO ag ree ment “as a

pplied” mea

ns that the WTO Member’s “ application of a g ener al rule to a

specific set of fa cts” is inconsistent with that Member’ s WTO obligations. Id . at ¶ 6 n.22. 7. Duringthe investig ation, neither the Plaintiff nor the Plaintiff-Interve nors made a n alleg ation of targ eted dumping , and Commerce did not determine whe ther it had oc curr ed. The Eur opean Communities therea fter c halleng ed Commerce ’s use of zer oing in se vera l antidumping investig ations and administrative re views bef ore the WTO, including the investigation that resulted in the impositi on of an a ntidumping duty

order on hot-rolled ca

rbon steel flat pr oducts from the N ether lands. SeeRequest for Consultations by the Europe an Communi ties, United States – Laws, Regulations and Methodology for Calculating Dumping Margins ( Zeroing) , at 4-5, WT/DS294/1 (J une 19, 2003). O n October 31, 2005, a WTO Panel fo un d C o m m er ce ’s u s e o f z er o i n g i ni n v es t i gat i o n s i n v o l v i n g co mp ar i s o n s o f w ei gh t ed -a v er age normal value s to weig hted-avera g e U.S. price s to be inconsistent with U.S. obli g ations under the AD Agree ment . SeePanel Report, United States – Laws, Regulations and Methodology for Calc ula tin g D um

ping M ar gin s ( “Ze ro ing ”) , ¶¶ 8.2- 8.4, WT/DS 294/R (Oct. 31, 2005) (“ Panel Re po rt ”). Spec ifically , the WTO Panel found that zeroingviolates the AD Ag re e me nt as such and as a pplied in the specific investigations at issue. Id . The Appe llate B ody upheld the WTO 7 Pane l’ s d e te rm inatio n o n a pp e a l and we nt f ur the r, sta tin g that Co mme rc e ’s us e of zer oin g in
cer tain administrative re views wa s also inconsistent with the AD Agree ment . SeeAp pe llateConsol. Court No. 07-00170 P age 9

Body Report, United States – Laws, Regulations and Methodology for Calculating Dumping Margins ( “Ze ro ing ”) , ¶¶ 132- 35, 263(a) (i), WT/DS294/AB/R (Apr. 18, 2006). In response to the Pa ne l R e po rt , Co mme rc e ann ounc e d th a t a s a g e ne ra l po lic y

it w ou ld use off setting a nd no longe r zero neg ative mar g ins in antidumpi ng investigations invol ving compar isons of “ave rag e-to-a vera g e” pr ices. Section 123 De termination , 71 Fe d. Reg . at 77,722. Throug hout its pronouncement, Commerce expli citly stated that the c entra l purpose of the Section 123 De termination was to conf orm its practice s with U.S. obli g ations as outlined in the Pa ne l R e po rt . Se e id . at 77,722. Specific ally , Commerce e x plained that the de partment’s ne w po lic y wo uld sp e c if ic a lly a pp ly in ( 1) the re c a lc ulatio n o f t he dumpi ngmarg ins in t

he “ sp e c if

ic antidumping investig ations” cha lleng ed by the Europe an Communiti es in the Pa ne l R e po rt and (2) a ll then curre nt and future investigations invol ving c omparisons of ave rag e-to-a vera g e pric es. Id . at 77,725. Notably , the Section 123 De termination did not embrac e all the f indings of the WTO Ap pe llate B od

y , s tatin g that th e c ha

ng e in p oli c y

a pp lie d o nly

to i nv e sti g a tio ns that us e
aver ag e-to-a

vera g e compa

risons and did not ext end to any other kind of investig ation or administrative re view. Id . at 77,724. Commerce subse quently

implemented its policy

chang e to par

ticular investig ations under Section 129 of the URAA. A pplying the Section 123 De termination to the investigation at issue, Comme rc e re c a lc ulate d th e we ig hte d- ave ra g e dumpi ngmarg in o n th e su bje c t me rc ha

nd ise wi th the use of of

fsetting , finding that it decre ased f rom 2.59% to zero. Section 129 De termination , 72 Fe d. Reg . at 25,262. The a g ency , there fore , revoke d the antidumping or der on hot-r olled
car bon steel fr om the Nether lands, eff ective f or entrie s of the subjec t mercha ndise made on orConsol. Court No. 07-00170 P age 10

afte r April 23, 2007. Id . I mportantly , Plaintiff and Plaintiff-Interve nors ar g ued duringthe Se c tio n 1 29 pr oc e e din g that Co mme rc e ’s Section 123 De termination wa s n ot i n a c c or da nc e wi th law bec ause the antidumping law s prohibit the use of off setting a nd require zeroing
. See I ssues and Dec ision Memorandum for the Final Results of the Section 129 De terminations , A-122-838, A-421-807, A -427-820, A- 428-830, A-475- 829, A-412-822, A -401-806, A- 469-807, A-475- 820, A-423-808, A -475-824, A- 475-818 (Apr . 9, 2007), De f. B r. App. A at 5-9 (“ Section 129 Determ ination Issues and Decision Me morandum ”). D efe ndant, howeve r, re jected that notion, stating that the Section 123 De termination wa s c on c e rn e d o nly wi th m akin g the sp e c if

ic investigations at issue in the Pa ne l R e po rt cong ruent with U.S. obligations under the AD Agreem ent , a

nd that it s a pp lic atio n to the Se c tio n 1 29 pr oc e e din g wa s in a c c or da nc e wi th U .S. law. Id . at 9-11. De fe nd ant a lso re je c te d c la ims by

U. S. St e e l, Nuc or

and Ar c e lorMitta l th a t it
err ed whe n it declined to make a finding on targ eted dumping
. Id . at 13-14. Commerc e explained that (1) the a lleg ation of targ eted dumpingwas untimely and (2) there was no g ood
cause to ext end the de adline for submitt ing suc h a cla im. Id . at 14. II. Su bjectMatt er Jurisdiction & Standard of Review Pur su ant t o 2 8 U .S. C. § 15 81 (c ), the Court ha s e xclu siv e jur isd ic tio n o ve r a ny c ivi l action commenc ed under

section 516A of the Tarif f Ac t of 1930, codified a s amende d at § 1516a, which pr ovides for judicia l reviewof, amongother proc eeding s, a Section 129 deter mination. 19 U.S.C . § 1516a(a )(2) (B )(vii). In revie wing one of Commerc e’s a dminist rative deter minations, the Court will hold unlawful any deter mination that is “unsupported byConsol. Court No. 07-00170 P age 11

Th e re are no iss ue s o f f

a c t be fo re the c ourt . 8 substantial evidence on the re cord or otherwise not in ac corda nce w ith law . . . .” § 1516a(b) (1)( B) (i). This case prese nts the court with the question of whe ther Commerc e’s a ctions are lawful when mea sured by

the provisions of the antidumping statutes and the statutory scheme passed by Con g re ss t o e nc oura g e c omp lia nc e wi th o ur

int e rn a tio na l tr a din g ob lig a tio ns . Spe c if ic a lly , it 8
re qu ir e s th e c ourt

to d e te rm ine wh e the r C omm e rc e ’s ne w i nte rp re tatio n o f c e rt a in c a lc ulatio ns in our antidumping statutes are in acc ordanc e with law. The test for de termining whether Commerce’ s interpre tation and application of the antidumping statute c omports with law is set forth in the two-step a

naly sis described in Che v ro n U .S .A ., In c . v . Na tural R es. De f. C ou nc il, Inc. , 467 U.S. 837 (1984) (“ Chevron ”). The Court must first determine whe ther Cong ress’s purpose a nd intent on the issue is clear ly expressed in the statute. See Che vron , 467 U.S. at 842- 43. To asce rtain Cong ress’s pur pose and intent, the Court must employ the traditional tools of statutory construction, looking first to the text of the statute a nd its plain meaning
. See id. at 843 n.9. I f the text provides an answe r to the question bef ore the court, that is the end of the matter. See id. at 842-43. Othe r ava ilable tools of statutory construction include the statute’s structure , canons of statutory construction, and le g islative history
. See W indmill Int’l PTE., L td. v. United States , 26 CI T 221, 223, 193 F. Supp. 2d 1303, 1306 (2002) . I f any of the tools of statutory construction make Congr ess’s purpose or intent on the issue cle ar, the n the Court and Commerce must give e ffe ct to that unambig uously expressed intent. See Che vron , 467 U.S. at 842-43.Consol. Court No. 07-00170 P age 12

Only if the statute is unclea

r or ambiguous with re spect to the pre cise que stion at issue must the Court decide, unde r the sec ond step of Chevron , whether Commerce’ s construction of the statute is permissible. Se e id . at 843. That inquiry essentially

examines whether Commerc e’s interpre tation of the statute is rea sonable, a nd require s the Court to consider “ the followingnone xclu siv e lis t of

fa c tor s: the e xpre ss t e rm s o f t he pr ov isi on s at is su e , th e ob je c tiv e s o f t

ho se provisions and the objec tives of the antidumping scheme as a whole.” W indmill Int’l PTE., L td. , 26 CI T at 22 3, 19 3 F . Su

pp . 2 d at 13 06 . I f C omm e rc e ’s c ho ic e “ re pr e se nts a re a so na ble
acc ommodation of the conflictingpolicies that wer e committed to the ag ency ’s ca re by statute,” then the Court should not disturb it“unless it appea rs from the statute or its leg islative history that the ac commodation is not one that Congr ess would have sanctioned.” Chevron , 467 U.S. at 84 5 ( qu otatio ns & c itatio n o mitte d) . T o s ur viv e jud ic ia l sc rutiny , Co mme rc e ’s c on str uc tio n mu st be re asonable , but it need not be “the only rea sonable interpr etation or e ven the mo st re a so na ble interpre tation . . . .” Koyo Seiko Co. v. U nited States , 36 F.3d 1565, 1570 ( Fe d. Cir. 1994). I mportantly , the Court may not substit ute its judgment for Commerce’ s, provided that the a g ency acte d rationally
. See Che vron , 467 U.S. at 843 n.11. III. Discussion Plaintiff and Plaintiff-Interve nors cha lleng e thre e aspe cts of the Section 129 Determ ination . First, they argue that the Section 123 De termination , in which Commerce
e xpla ine d th at it

wo uld us e of fs e tti ngin c e rt a in i nv e sti g a tio ns , is itself contrar y to law. Essentially , Plaintiff and Plaintiff-Interve nors contend that Congre ss’s intent and purpose on the issue of off

setting is cle ar be cause (1) the te x ts of 19 U.S.C. §§ 1673c(b)(2) , 1673c(c ), 1677(34) ,Consol. Court No. 07-00170 P age 13

16 77 (3 5) (A )- (B ) a

nd 16 77 f- 1( d) de mon str a te tha t Co ng re ss d id n ot i nte nd fo r C omm e rc e to eng ag e in offse tting; (2) the denial of of fsetting is nece ssary

to give eff

ect to the diff

ere nt statutory methodologie s for c alculatingdumping mar g ins in investigations as they are descr ibed in § 1677f-1(d) – a point of law a lleg edly rec og nized by

Def endant a nd the WTO; (3) Commerc e’s r eadingof the ter m “exceeds” in cer

tain investigations would render §§ 1673c(b) (2), 1673c (c) , and 1677f- 1(d) mea ningle ss; and (4) F eder al Circuit prec edent is not
c on tr oll ingon

the iss ue he re . U .S. Ste e l Summ. J. B r. 7- 23 ; N uc or Summ. J. B r. 8- 22 ; G a llatin Summ. J . Br . 6-32; Arc elorMittal Summ. J . Br . 19-28. Second, Plaintiff a nd Plaintiff-Interve nors
a l l e g e th a tth e u s e o f

o f f s e t t i n g i nth e S e c t i o n1 2 9 p r o c e e d i n g w a s un l aw f u l
. S p e c i f

i c a l l y, Plaintiff and Plaintiff-Interve nors ave r that Commerce acte d contra ry to law when it used a

n
a lle g e dly ill e g a l me tho do logy

– o ff se tti ng– to re c a lc ulate the we ig hte d- ave ra g e dumpi ngmarg in on the subject mer chandise in the Section 129 proce eding . U.S. Steel Summ . J . Br . 7-23; Nucor Summ. J . Br . 6, 8-22; Gallatin Summ. J . Br . 6-32; Arc elorMittal Summ. J . Br . 28. Third, Pla int if f- Inte rv e no rs Nu c or

and Ac rc e lorMitta l c on te nd

that Co mme rc e e rr e d whe n it de c lin e d to
c o n s i d e r th e i r c l a i m s o f t ar g e t e d d u mp i n g d ur i n g th e S e c t i o n1 2 9 p r o c e e d i n g . N u c o r S u m m . J. Br . 22-31; Arc elorMittal Summ. J . Br . 29-39. Def endant, howe ver, r ejec ts these claims. De fenda nt argues that Plaintiff and PlaintiffInterve nors attempt to relitig ate a leg al issue pre viously

settled by

the Fe dera l Circuit in Timken Co. v. United States , 354 F.3d 1334 ( Fe d. Cir. 2004) (“ Timken ” ) a nd in s ub se qu e nt c a se s: whether the seve ral a

ntidumping statutes re quire zeroingwhen Commerc e ca lculates the weig hted-avera g e dumping marg in. Def. B r. 9. De fenda nt aver s that this claim is foreclosedConsol. Court No. 07-00170 P age 14

since Timken decide d that zeroing is not required. D ef. B r. 12-14. Eve n if the cour t should find that the Fe dera l Circuit prece dent is not binding her e, De fenda nt alleg es that the interpr etation of the Section 123 De termination by Plaintiff and Plaintiff-Interve nors is overly broad a nd
err oneously

assumes that Commerce ’s cha ng e in policy

applies to all ty

pes of pr ice c omparisons. Def . Br . 14-18. De fenda

nt notes that the offse tting methodolog y does not apply

universally , and instead is limit ed to compar isons involvi ng aver ag e-to-a vera g e pric es in investigations. Def. B r. 14-18. Ac cording ly , in light of Commerc e’s pe rmissible readingof the a ntidumping statutes and the Section 123 De termination , Def endant c ontends that the Section 129 De termination was
ma de in a c c or da

nc e wi th l aw. De f. B r. 18 -2 2. To jus tif y thi s a c tio n, De fe nd ant s pe c if ic a lly states that it acted to implement an a dverse WTO report a nd to harmonize cer

tain U.S. prac tices with its i nternational obligations. De f. B r. 18-19. F inally , Def endant a rgues that Commerce
rea sonably

deter mined that the targ eted dumpingalleg ations raised by Plaintiff-Interve nors Nucor and Ar celorMittal were untimely beca use those cla ims were not r aised duringthe initial investigation, as require d by the per tinent regulations. Def. B r. 23-25. A. Offse tt ing I t is wi thi n th e pr ov inc e of the jud ic iary

to i nte rp re t th e law, and

ind e e d th e c ourt

ha s a duty to do so under Ar

ticle I I Iof the U.S. Constitut ion when re viewingexecutive ag ency action
u s i n g th e t e n e t s e s t a

b l i s h e d b y Chevron
. See Timex

V.I., Inc . v. United States , 157 F.3d 879, 881 (F ed. Cir. 1998) (c iting Marbury v . Madison , 5 U. S. ( 1 Cr anc h) 13 7, 17 7 ( 18 03 )) . U nd e r t he fi rs t step of Chevron , the cour t must decide whe ther §§ 1673c (b)( 2), 1673c( c), 1677( 34), 1 6 7 7 (3 5 )( A) -( B) , an d

1 6 7 7 f- 1 (d ) u n am b i gu o u s l y p ro h i b i tth e u s e o f o ff

s et t i n g.Consol. Court No. 07-00170 P age 15

Since Timken , the Fe dera l Circuit has hear d sever al ca ses discussing the use of zer oing 9 in cer tain antidumping pr ocee dings. See SKF USA , Inc. v . United States , 537 F.3d 1373 ( Fe d. Cir . 2 00 8) ; NSK L td. v. United States , 5 10 F .3 d 1 37 5 ( F e d. Cir . 2 00 7) ; Corus Staal BV v. United States , 5 02 F .3 d 1 37 0 ( F e d. Cir . 2 00 7) ; Corus Staal BV v. De p’t of Commerce , 395 F.3d 1343 (F ed. Cir. 2005) (“ Corus I ”). J ust as the Fe dera l Circuit has repe atedly found that the pe rtinent antidumping statutes do not unambiguously

reve al Cong ress’s position on the issue of zeroing , this court simil arly finds 9 that a cle ar Cong ressional intent or pur pose on the que stion of offsettingis absent from the statut e s at is su e . A c c or din g to § 16 77 (3 4) , s ub je c t me rc ha

nd ise is “ dumpe d” int o th e U. S. i f i t is
so ld, or lik e ly to b e so ld, at le ss t

ha n f a ir va lue . § 16 77 (3 4) . T hat de fi nit ion , o n it s f a c e , me re ly provides the c ore e x planation for that term, which a ppear s fre quently

throug hout severa l antidumping statutes. The term does not, howe ver, spe ak to any one method for

deter mining wh e the r s a le s are ma de fa ir ly or un fa ir ly , n or

do e s it state the ty

pe s o f s a le s th a t Co mme rc e mus t
c on sid e r whe n ma

kin g an a nti dumpi ngde te rm inatio n. In o the r w or ds , th e de fi nit ion ho us e d in § 1677(34) is limited, ex plicitly defininga ter

m that describe s the behavior which the antidumping sy stem aims to eradic ate. Section 1677(35) de scribes the proce dure that Comm erc e must use to deter mine whether sales of the subject merc handise a re ma de at less than f

air va lue. In rea chingthat deter mination, Congr ess direc ts Comm erc e to make “ a fa ir compar ison . . . betwee n the [EP] or [CEP ] and [NV] .” § 1677b(a ). To ar rang e a f air c omparison Commerce must first calculate the dumping marg in, a term de fined a s “the amount by which the [NV] ex cee ds the [EP ] or [ CEP] of the subject merc handise.” § 1677(35)( A). Where NV sale s are less than EP or CEP sales, a neg ative value dumpingmarg in is the end product of the ca lculation. In contra st, a positive valueConsol. Court No. 07-00170 P age 16

dumpi ngmarg in i s th e re su lt o f N V s a le s b e ingg re a te r t ha n th e EP o r C EP s a le s. Th e statut e g oes on to say

that Commerce e x press the a g g reg ate of the dumping ma

rg ins for the subjec t
merc handise a s a per centa g e, i.e. the weighted-avera g e dumping marg in, which is calc ulated by “dividing the ag g reg ate dumpingmarg ins determined f or a spe cific e x porter or

produce r by

the ag g reg ate [EPs] and [CEP s] of such exporter or produc er.” § 1677(35)( B)
. The c ourt is bound by

the Fe dera l Circuit’s rea ding of these provisions in Timken , which found that Cong ress’s de finition of “dumping ma rg in” is unclea

r as to the whe ther positive and neg ative value dumping mar g ins fit within t he desc ription of that term. See Timke n , 354 F.3d at 1341-43. The F eder al Circuit held that neither the “f air c omparison” phr ase in § 1677b(a ), nor the “e x cee ds” languag e in § 1677(35)( A), re quires that Commerce consider only those dumping marg ins that y ield a positive value a s satisfying the statutory definition of the ter

m “dumping marg in.” Se e id . The F eder al Circuit in Corus I a lso ma de c le ar t hat th e fo rm

ula de sc ri be d in § 1677(35)( B) does not limit Commerce a s to the specific values that it must consider whe n calc ulating the weig hted-avera g e dumping marg in. See395 F.3d at 1346-47. The languag e of § 1677(35)( A)-( B) mere ly provides the r ecipe for c alculatingthe dumping ma rg in and the ag g reg ate of

those numbers – the w eig hted-avera g e dumping marg in – to ulti mately deter mine whether the sales at issue were fairly made. How ever , those statutes do not sugg est that Congr ess intended f

or ce rtain value s to fit within t he def inition of a “dumping marg in” when Commerce de termines the we ighte d-ave rag e dumping marg in. I n other wor ds, the ce ntral point of Timken is that Congre ss, in craf ting the statutory

definitions of “dumpingmarg in” and

“ w e i g h t e d

- av e r a g e d

u mp i n g m ar g i n , ” d i d

n o ta d dr e s s w h e th e r

C o m m e r c e mu s t( 1 ) e mp l o y aConsol. Court No. 07-00170 P age 17

The Uruguay Round Agre eme nts Act, Statement of Administrative Action , H.R. Rep. 10 No. 103-316 (1994) , re

pr inte d in 1994 U.S.C.C.A.N. 4040 (“ SAA ”), is also silent on the issue of whether positive and neg ative value dumping mar g ins may be used in c alculatingthe weightedaver ag e dumping marg in. The SAA is “an a uthoritative expression by the United States conce rningthe interpre tation and application of the Uruguay Round Ag ree ments and [the URAA] in any

judicial proce edingin which a que stion arises conc erningsuch interpr etation or application.” 19 U .S.C. § 3512(d). Absent from the te x t is any clea r Cong ressional indication that Commerce should c onsider only cer tain values a s fitting within the def inition of “dumping marg in,” or in makingweig hted-avera g e dumping marg in determinations. See SAA , H.R. Rep. No. 103-316, at 819-20, 842-43, re pr inte d in 1994 U.S.C.C.A.N. at 4160-61, 4177-78. Se c tio n 1 67 3c (b )( 2) pr ov ide s f or the su sp e ns ion

of an a nti dumpi ngduty

inv e sti g a tio n if 11 all sales at less than f

air va lue ar e eliminated, statingexpli citly that Commerce ma

y suspend an investigation if the exporters of the subjec t mercha ndise who ac count for substantially all of the imports of that mercha

ndise ag ree to (1) ce ase e x ports of the mer chandise to the U.S., or (2) revise the ir price s to eliminate completely any amount by

which the NVexceeds the EP or the CEP of the mercha

ndise. § 1673c(b) (1)- (2). Unde r extraordinar y circ umstances, Commerc e may suspend an investig ation if (1) “ the exporters of the subje ct merc handise who a ccount f or substantially

all of the imports of that mer chandise ” into the U.S. ag ree to revise pr ices, (2) that ag ree ment eliminates the injurious eff ect of the dumped mer chandise , (3) the subje ct imports do not underc ut the price levels of domestic like pr oducts, and (4) the estimated dumpingmarg in of ea ch en try

o f e ac hex p o rt er

t o th e a gre em en td o es n o tex ce ed1 5 p er ce n to f t h e w ei gh t ed -a v er age dumping mar g in for all dumped e ntries made by the exporters duringthe cour se of the investigation. § 1673c(c) (1)( A)-( B) . Finally , in antidumping investig ations, § 1677f-1(d) explains t hat NV a

nd EP (or CEP) shall normally be compa

red on a weig hted ave rag e-toweig hted ave rag e, or individual transa ction-to-individual transac tion, basis. § 1677fcer tain methodology

to calculate the dumping marg ins for the subjec t mercha ndise, and (2) c onsider only

cer tain values – positive, neg ative, or both – a s a “dumpingmarg in” when
c a lc ulatin g the we ig hte d- ave ra g e dumpi ngmarg in. Th e re fo re , b e c a us e the F e de ra l Cir c uit

in 10 Timken found that the statute is uncle ar a s to which values f it within t he def

inition of the term “dumping marg in,” the statutory text does not unambiguously compel the c ourt to find that Commerce’ s use of off

setting is prohibited. Moreove r, the languag e in §§ 1673c( b)(2) , 1673c(c ), and 1677f -1(d) does not clar ify Congr ess’s intent on this issue. Plaintiff and Plaintiff-Interve nors cite to these sections as 11Consol. Court No. 07-00170 P age 18

1(d)( 1)(A) (i)-( ii). An exception is provided wher e ther e is a pattern of EPs that diffe r signific antly

amongpurcha sers, re g ions, or periods of time, a nd in those case s Commerce ma y compar e NV a

nd EP (or CEP) on a we ighte d aver ag e-to-individual transaction basis. § 1677f1(d)( 1)(B ). pr ov idi ngfu

rt he r e vid e nc e that on ly

tho se dumpi ng

ma rg ins that r e su lt i n a

po sit ive va lue fi t wi thi n th e de fi nit ion

of “ dumpi ngmarg in” in § 16 77 (3 5) (A ). Th a t a sse rt ion , h ow e ve r, is incorre ct. Sections 1673c(b) (2), 1673c (c) , and 1677f- 1(d) state that Commerce ma y undertake a pa rt ic ula r a c tio n in

an a nti dumpi nginv e sti g a tio n if c e rt a in c on dit ion s a

re pr e se nt. Th os e provisions are unr elated to the inquiry here , leavingunanswe red the question of whethe r Commerce must consider only cer tain values whe n it calculate s dumping mar g ins for the subjec t
merc handise. The ref

ore, w ith §§ 1673c(b)( 2), 1673c( c), a nd 1677f-1( d) beinginapplicable, the Fe dera l Circuit’s rea ding of § 1677(35)( A)-( B) in Timken and Corus I controls the cour t’s analy sis here. Be cause the cited pr ovisions do not di rec tly speak to the issue of

positive and neg ative value dumpingmarg ins, the second step of Chevron require s that the court e valuate whether C o m m e r c e ’ s i n t e r

p r e t at i o ni s b a s e d

o na p e r m i s s i b l e c o n s tr

u c t i o no f th e s t a tu t e s a ti s s u e . In
rec og nition of Comm erc e’s e x pertise in the f ield of antidumping law, the c ourt owes substantial defe renc e to the ag ency

when it interpre ts an ambig uous antidumping statute. See Nuc or Corp. v. United States , 3 2 CI T _

__ , _

__ , 5 94 F . Su

pp . 2 d 1 32 0, 13 32 (2 00 8) . T he de fe re nc e a c c or de d to Commerce’ s interpre tation is at its hi g hest when that ag ency acts unde r the a

uthority of a Con g re ssi on a l ma

nd ate to h arm on ize U. S. p ra c tic e s w ithint e rn a tio na l ob lig a tio ns , p art ic ula rl y when it allows the Executive B ranc h to speak on be half of the U.S. to the internationalConsol. Court No. 07-00170 P age 19

“F oreig n commerc e is pre- eminently a matter of national c oncer

n.” Japan Line, Ltd. v. 12 County of Los Angeles , 4 41 U. S. 4 34 , 4 48 (1 97 9) . T he U. S. Co ns tit uti on e nd ow s Co ng re ss w ith the power to regulate commer ce w ith “fore ign N ations,” U. S. C O N ST . art. I , § 8, cl. 3, but the L eg islative Br anch ma

y deleg ate that a

uthority to executive ag encie s both ex pressly and i mp l i e d l y: Whe re Con g re ss h a s e xplic itl y le ft a g a p f or the a g e nc y

to f ill , th e re is a

n e xpre ss de le g atio n o f a

uth or ity to t he a g e nc y to e luc idate a

sp e c if ic pr ov isi on

of the statut e by regulation. [ Chevron ], 46 7 U .S. a t 84 3- 44 . In o the r c ir c ums tanc e s, Con g re ss may impliedly

authorize an a g ency

to pronounce its judgment on an issue w ith the forc e of la

w. Se e id . at 84 4; Cathedral Candl e Co. v. United States , 400 F.3d 1352, 1361 (F ed. Cir. 2005). Mittal Canada, Inc. v. United States , 30 CI T 1565, 1567, 461 F. Supp. 2d 1325, 1328 (2006)
. Commerce’ s authority

to interpret a

nd implement cer

tain prac tices is clea

r in the ar ena of antidumping law

wher e “Cong ress would e x pect the a g ency to be able to spe ak with the for ce of law whe n it addresse s ambig uity in the statute or fills a spac e in the ena cted law , even one about which ‘Cong ress did not ac tually have a n intent’ as to a pa

rticular r esult.” Mittal Canada, Inc. , 3 0 C I T at1 5 6 7 -6 8 , 4 6 1 F. S u p p . 2 d at1 3 2 8 (c i t i n g Un ite d S

tates v . M e ad Cor p ., 533 U.S. 218, 22 9 ( 20 01 )) ; see also Pe

squera Mares Australes Ltda. v. United States , 266 F.3d 1372, 1379- 80 (F ed
. C i r. 2 0 0 1 ) ( ac co rd i n g Chevron defe renc e to Commerce ’s interpre tation of ambiguous statutory terms in the cour se of a

n antidumping de termination). community

on matters of tra de and c ommerce . Se e Cro sb yv . Na t’ l F

or e ign Tra deCou nc il , 12 53 0 U .S. 36 3, 38 1- 82 (2 00 0) (s tatin g tha t it is t he duty of the Exe c uti ve B ra

nc h to pr e se nt a coher ent position on behalf of the national ec onomy ); Fed.-M ogul Corp. v. United States , 63 F.3d 1572, 1582 ( Fe d. Cir. 1995). The c ourt finds that both Commerce’ s determination and its re adingof the c ited statutes
are rea sonable. In rea chingthe Section 123 De termination , Commerce w orked w ithin the framework e stablished by Congr ess to acc ord U.S. prac tices with the nation’s international trade obligations. Congre ss anticipated that the U .S. would need to take a ction to make domestic law comport with those international trade oblig ations, specific ally requiringthe close c ooperation of the Executive and L eg islative Br anche s to determine how the U.S. would chang e its prac tices.Consol. Court No. 07-00170 P age 20

Equally telling he re is Cong ress’s ta cit approva l of the newoffse tting methodolog y . 13 Ev e n a ft e r e xten siv e c on su ltatio ns be tw e e n th e Exe c uti ve and L e g isl a tiv e B ra

nc he s, Con g re ss had the oppor

tunity to indicate its disag ree ment with Comm erc e’s a doption of the new r ule. § 3 53 3( g )( 3) . Co ng re ss, ho we ve r, de c lin e d to do so , a nd the re is n o e vid e nc e to s ug g e st t hat it disag ree s with Comm erc e’s use of the ne w policy
. § 3533(g ). The Section 123 De termination is the result of such a car eful ba lancingact, whe reby the Exe c uti ve B ra

nc h s ou g ht t o f

a c ili tate c oll e g ia l in te rn a tio na l tr a de re latio ns hip s w hil e
c on tin uin g to a ff

or d d ome sti c ind

us tr ie s th e pr ote c tio n th e y ne e d to c omp e te wh e n unf a ir ly trade d merc handise is pre sent in the marke tplace. Commerc e solicited, re ceive d, and conside red comments from membe rs of the pr ivate international trade c ommunity in acc ordanc e with the statute, and followe d the ag ency ’s re g ular pra ctice a nd proce dures in so doing . Throug hout the Section 123 De termination , Co mme rc e state d th a t it s c ha ng e in p oli c y

wa s n e c e ssa

ry to harmonize its practice s with the international oblig ations of the U.S. See Se ction 123 Determ ination , 71 Fe d. Reg . at 77,722 (“ This final modification is nece ssary to implement the
re c omm e nd atio ns of

the [WTO ] Dis pute Se ttl e me nt B od y .” ); Id . at 77 ,7 23 (“ [Comm e rc e ] is doing so in re sponse to the [ Pa ne l R e po rt ], following the proc edure s set forth in sec tion 123 of the UR AA .” ); Id . at 77,724 (“ This exercise is nec essar y to implement the [ Pa ne l R e po rt ] wit hin the re a so na

ble pe ri od

of tim e ne g oti ate d b y

the Un ite d St a te s. ” ). Th e se state me nts de mon str a te that th e Exe c uti ve B ra

nc h, thr ou g h it s r e pr e se ntativ e s at th e UST R and Comme rc e , r e a so na

bly
wo rk e d in

c on c e rt wi th C on g re ss u

nd e r t he a pp lic a ble statut or

y sc he me to p ro mot e c omi ty wi thi n the international trade c ommunity and conf orm domestic pra ctices w ith U.S. int ernational trade ob lig a tio ns . 13Consol. Court No. 07-00170 P age 21

Most important, Com merc e does not off ended the centr al aim of the a ntidumping laws by interpre ting § 1677( 35)(A) -(B ) to permit offse tting. The principal purpose of the a ntidumping laws is t o p ro te c t do me sti c ind us tr ie s f ro m f or e ig n ma nu fa c tur e d g oo ds that are so ld w ith inj ur iou s e ff

e c t in the U. S. at pr ic e s b e low

the fa ir mark e t va lue of

tho se g oo ds in t

he ir ho me marke t. See Sango I

nt’l, L.P. , 484 F.3d at 1372. Howeve r, these pr inciples are meant to level the playing f

ield betwee n fore ign a

nd domestic manufa cture rs of like mer chandise , not give an “unfa ir adva

ntag e to the domestic industry . . . .” Pee r Bearing Co. , 2 5 C I T at12 21 , 1 82 F. Supp. 2d at 1310. Whi le the Section 123 De termination does alter the way Commerce c alculate s weig hted-avera g e dumping marg ins in certain investig ations, it does not leave potentially injured domestic industries without any rec ourse. Indeed, the Section 123 De termination does not eliminate the ce ntral we apon used to prote ct domestic industries from dumped me rcha ndise – antidumping duties – but rather, mer ely amends the ma

nner in whic h those duties are calc ulated in cer tain proce eding s. That the Section 123 De termination re qu ir e s Co mme rc e to c on sid e r b oth fair a nd less than fa ir value sa les in investigations invol ving a vera g e-to-a

vera g e pric e
c omp ari so ns make s th e ana ly sis of the data fo r s a le s o f t

he fo re ig n a

nd do me sti c me rc ha

nd ise arguably more fa ir than it was under the old methodology

of zeroing . In using the new of fsetting methodology , Commerce must consider all sales in ce rtain investig ations, and take a more complete view

of the mar

ket for the subject merc handise be fore assessingwhether antidumping dutie s sh ou ld b e imp os e d, if at a ll. Es se nti a lly , th e of fs e tti ngme tho do logy

fo rc e s Co mme rc e to do more than look for

particula r unfa irly made sa les, requir ing instea d that the ag ency consider the marke t as a whole when e ng ag ing in its statutorily assig ned duty

of dete rmining whetherConsol. Court No. 07-00170 P age 22

To be sure , the discussion here on any harm that the Section 123 De termination may 14 have inf licted is on the microec onomic scale within the domestic steel industry itself, and does not acc ount for any

damag e ca

used by macr oeconomic de velopments in the g ener al g lobal mark e t. “Profits are net re venues, or the diffe renc e betwe en total sales a nd total costs.” Id . at 15 27. dumping ha s occur

red in the dome stic industry at issue. Thus, Commerce ’s construc tion of the pe rt ine nt s tatut e s, wh ic h p e rm it the us e of bo th p os iti ve and

ne g ativ e va lue dumpi ngmarg ins in calc ulating the weig hted-avera g e dumping marg in, is reasona ble. Whil e the c ourt finds that the Section 123 De termination is i n a c c or da nc e wi th l aw, it also rec og nizes that Com merc e likely altere d competitive conditions in every domestic industry wh e re an a

nti dumpi ngpr oc e e din g wa s th e n in pr og re ss o r t

he re a ft e r i nit iate d, inc lud ingthe U. S. steel industry
. A marke t, in the simpl est of ter ms, “is a mecha

nism through whic h buy ers a nd 14 sellers intera ct to deter

mine price s and exchang e g oods and ser vices.” P A U L A. S AMUEL S ON & W I L L I AM D. N OR DHAUS , E CON O M I CS 26 (18th ed. 2005). O f all the c omponents that shape
c omp e tit ion

wi thi n th e mark e tpl a c e , p ri c e s a re g e ne ra lly

the mos t in fl ue nti a l, e ff

e c tiv e ly coordinating “ the dec isions of producer s and consumer s in a marke t.” S AMUEL S ON & N O RD H A U S at 27 . It is no se c re t th at a dif fe re nc e in p ri c e wi ll d

ri ve so me c on sume rs to purcha se their g oods from one se ller over another , there by

causingeconomic injury in the form of lost profits to the manufac turer se lling at a highe r price
. Se e id . at 27-28. The g overnme nt

15
a c tio n a ff e c te d h owdo me sti c manu fa c tur e rs pr ic e d c e rt a in g oo ds wi thi n th e ir re sp e c tiv e mark e ts to remain c ompetitive. The Section 123 De termination there fore chang ed the mar ket conditions for domestic pr oducer s, who may have r elied on Commerce ’s use of zer oing in pa st antidumpingConsol. Court No. 07-00170 P age 23

In orig inal antidumping investig ations, Commerce w ill normally use the avera g e-to- 16 ave ra g e me tho d to c a lc ulate dumpi ngmarg ins fo r t he su bje c t me rc ha

nd ise . 1 9 C. F .R. § 351.414(c) (1). The ag ency may only use the tra

nsaction-to-tra

nsaction method in “unusual sit ua tio ns , s uc h a s w he n th e re are ve ry fe w s a le s o f s ub

je c t me rc ha

nd ise and the me rc ha

nd ise sold in each ma

rket is identical or

very simil ar[,] or is custom-made.” Id
. Def endant notes that neither the Section 123 De termination , nor its application to the 17 Section 129 De termination , has pre vented Commerc e fr om applying the transac tion-totransac tion methodology

or the tar g eted dumpingprovision with the use of the zeroing methodology . Def

. Br . 16-17. pr oc e e din g s to de te rm ine mark e t pr ic e s. No w, ho we ve r, tho se do me sti c pr od uc e rs may

ne e d to compete mor e rig orously

to maintain or g ain marke t share, to disca rd established sa les patterns and cr eate new business models, and to a dopt new pric e pra ctices to a ccount f or cha ng ing competitive conditions within their respec tive marke ts. Ho we ve r, a s th e c ourt

no te s a bo ve , Pl a int if

f a nd Pla int if f- Inte rv e no rs are no t to ta lly fore closed fr om seekingthe kind of protec tion they wer e af forde d under the old zeroing methodology . In the Section 123 De termination , Co mme rc e sp e c if ic a lly no te d th a t it s d e c isi on

is limit ed to “a

vera g e-to-a

vera g e compa

risons in investigations” a nd that the deter

mination did not
rea ch “a ny other c omparison methodolog y or any other seg ment of an a

ntidumping proc eeding . . . .” Section 123 De termination , 71 Fe d. Reg . at 77,724. I ndeed, Commerc e has implemente d no chang e with re g ard to the use of zeroingfor the individual tra nsaction-to-individual transac tion methodology

outlined in § 1677f-1(d)( 1)(A) (ii), or the we ighte d aver ag e-to- 16 transac tion targ eted dumpingmethodology descr ibed in § 1677f-1( d)(1) (B ). Ac cording ly , a petitioner may

find that it is mos t prudent to solicit Com merc e to use the transaction-totransac tion methodology

in the pertinent investig ation, or to asser t a claim of ta

rg eted dumping wh e n a pp lic a ble in f utu re pe tit ion s to re me dy

the ir a lle g e d in

jur ie s. 17Consol. Court No. 07-00170 P age 24

Contrary to Plainti ff a

nd Plaintiff-Interve nors’ a lleg ations, Commerce’ s rea ding of the term “e x cee ds” in § 1677(35)( A) in the Section 123 De termination does not rende r §§ 16 73 c (b )( 2) , 1 67 3c (c ), and 16 77 f- 1( d) me anin g le ss. I t is we ll e sta bli sh e d th a t “ the re is a
natur a l pr e sumpt ion

that id e nti c a l w or ds us e d in dif fe re nt p art s o f t

he same a c t are int e nd e d to have the same mea

ning.” Helve ring v. Stockholms Ensk ilda Bank , 293 U.S. 84, 87 (1934) (citation & quotations omit ted). How ever , that “pre sumption readily yields to the controlling forc e of the circ umstance that the words, thoug h in the same a ct, ar e found in such dissimilar
connec tions as to warra

nt the conclusion that they wer e employ ed in diffe rent pa rts of the a ct with differ ent intent.” Helve ring , 2 93 U. S. at 87 (c itatio n o mitte d) . T he F e de ra l Cir c uit in Timken made c lear

that Congr ess’s intent on the mea ning of the term “ dumping mar g in” and the use of “ exceeds” there in is unclear, the reby requiringthe cour

t to affor d Commerce the defe renc e it is due under Chevron
. See Timke n , 3 54 F .3 d at 13 41 -4 3. He re , Co mme rc e no te s th a t it interpre ts § 1677(35)(A) and the ter m “exceeds” differ ently

in investigations invol ving a vera g eto-ave rag e pric es compa

risons than it does in all other antidumping proce eding s so as to ensure that its practice s comply

with U.S. international trade obligations. See Se ction 123 Determ ination , 71 Fe d. Reg . at 77,724. That Commerc e re peate dly expressed its intent to (1) limit the scope of the Section 123 De termination and (2 ) r e str ic t it s r e a din g of

the te rm “ e xce e ds ” only to the nomenclatur e used in spec ific ty pes of investig ations sug g ests that Commerce did not intend to amend the a g ency ’s under standing of the ter m “exceeds” as it appea

rs in other antidumping statutes. In light of those c lear statements and the f

oreig n policy

implications ofConsol. Court No. 07-00170 P age 25

Pla int if f- Inte rv e no r G a llatin

a lso argue s th a t Co mme rc e ha s n ot p ro vid e d a re a so na ble 18 basis for disting uishing the te rm “dumpingmarg in” as it applies in the pre sent proce edingfrom the us e of that te rm in a dmi nis tr ativ e re vie ws . G a llatin Summ. J. B r. 28 -3 2. Th e c ourt dis a g re e s, emphasizing a g ain that it must afford Commerc e the de fer ence it is due under Chevron in the prese nce of

an ambiguous statute. There fore , in light of Commerc e’s c ompliance with the proce dures outlined in § 3538(g ), the limited scope of the proc eedingunder Sec tion 123, and the justifications provided by the ag ency

for takingsuch ac tion, the court af firms the Section 123 Determ ination as re asonable
. this particular a

ntidumping proc eeding , the cour t rec og nizes that Com merc e’s inter pretation of the term “ exceeds” in the Section 123 De termination is permissible. 18 The a rgument that the Section 123 De termination underc uts the eff ect of the diffe rent statutory methodologie s for c alculatingdumping mar g ins in investigations as they are descr ibed in § 1677f-1(d) is an attempt to relitigate an issue de cided by the Court in Dorbest Ltd. v. United States , 30 CI T 1671, 462 F. Supp. 2d 1262 (2006) (“ Do rb est ” ). Th e pla int if

fs in t hat c a se broug ht an ar g ument near ly identical to the one r aised he re r eg arding§ 1677f-1( d). Se e Do rb est , 30 CI T at 1735, 462 F . Supp. 2d at 1316. Here , Plaintiff specifica lly contends that “ it was Congr ess’[s] intent that the two alternative compar ison methodologies in 19 U.S.C. § 1677f-1(d) yield differ ent re sults.” U.S. St eel Summ. J . Br . 15. When Comm erc e uses of fsetting , U.S. Steel argues that the re sults of the two comparison methodolog ies will alway s be the same , a conseque nce which alleg edly nullifies Congre ss’s intent that the differ ent compar ison formulas achie ve distinct results. U.S. Steel Summ . J . Br . 15-19, Ex. 1. The problem for Plaintiff a nd Plaintiff-Interve nors her e, one that simi larly deter red the claimants in Do rb est , is that the Fe dera l Circuit in Timken and its prog eny make c lear that the startingpoint for the debate on this issue lie s in the te xt of

§ 1 67 7( 35 )( A) -( B ), wh ic h h a s une qu ivo c a lly be e n h e ld t o b e ambi g uo us a s to th e u s e o f p o s i t i v e a n d

n ega t i v e v al u e du mp i n g m ar gi n s i nca l cu l at i n g th e w ei gh t ed -a v er ageConsol. Court No. 07-00170 P age 26

dumping mar g in. When a court finds a provision to be ambig uous as to the spec ific issue bef ore the cour t, Chevron require s that the ag ency action be a ffor ded due de fer ence so long a s such action is rea sonable. F or the re asons explained here in, the Section 123 De termination is i n
acc ord with law a

nd is reasona

ble. Acc ording ly , g iven that ambiguity and the c ontrolling F eder al Cir c uit prec edent, the c ourt ag ree s with the statutory construction ana ly sis in Do rb est , and there fore aff

ords Commerce ’s re asonable rea ding of § 1677(35)( A)-( B) the def ere nce it is due under Chevron
. Se e id
. In sum, the antidumping statutes a re unc lear as to the use of

positive and neg ative value dumpi ngmarg ins in w e ig hte d- ave ra g e dumpi ngmarg in c a lc ulatio ns . Co mme rc e c omp lie d w ith the re quirements enume rate d in § 3533(g ), and its construc tion of the pertinent statutory provisions to permit the use of off setting is re asonable here . Be cause the Section 123 Determ ination is in accor dance with law, the cour t finds that Comm erc e’s use of off setting in the Section 129 De termination was not unlawf ul. There fore , the cour

t affir ms Comm erc e’s Section 129 Determ ination g iven that (1) the Section 123 De termination is in accor dance with law, and (2) the justification for Commerce ’s ac tions under Section 129 is rea sonable. B. T ar ge te d Du m ping Th e fi na l qu e sti on

be fo re the c ourt

is whe the r C omm e rc e c or re c tly de c lin e d to e nte rt a in the re quest for a

targ eted dumpinganaly sis made by Plaintiff-Interve nors Nucor and Ar c e lorMitta l. Ta

rg e te d d ump ingoc c ur s w he re a

fo re ig n e xpor

te r o r p ro du c e r s e le c tiv e ly se lls
merc handise at less than fair va lue in cer tain product lines, to ce rtain customer s, reg ions, or at
cer tain times of the y ear . § 1677f-1( d)(1) (B ). The Code of F eder al Regulations specify thatConsol. Court No. 07-00170 P age 27

C o m m e r c e n o r

m a l l y w i l l e x am i n e o n l y t ar g e t e d d u mp i n g d e s c r i b e d

i nana l l e g a t i o nf

i l e d b y a pe tit ion e r n o late r t

ha n th ir ty da y s b e fo re the sc he du le d d a te of the pr e lim ina

ry de te rm inatio n in
ano r i g i n a l i n v e s t i g at i o n . 1 9 C
. F
. R
. § 3 5 1
. 3 0 1 ( d ) ( 5 ) ( a s r e s e r v e d b y W ithdrawal of the Regulatory Provisions Gove rning Targeted Dumping in Antidumping Duty Inve stigati ons , 73 Fe d. Reg . 74,930, 74,930 (De p’t Commerce Dec . 10, 2008). Howe ver, Commerc e has note d that it is flex ible with that deadline whe re g ood cause is shown, such as in investig ations where “the timing of re sponses does not per mit adequate time f

or ana ly sis . . . .” An tid

um ping D uti es; Countervailing Duties , 62 Fe d. Reg . 27,296, 27,336 (De p’t Commerce May 19, 1997). Commerce pr operly

considere d Nucor

and Ar celorMittal’s alleg ations of targ eted dumping to be untimely . “Commerce has broa d discretion to establish its own rules g overning administrative proc edure s, including the establishment and enf orce ment of time limit s . . . .” Reiner Brac h GmbH &Co. KG v. United States , 26 CI T 549, 559, 206 F. Supp. 2d 1323, 1334 (2002) ( citation omitted). Under that authority , Commerce “ must be permitted to enfor ce the time frame provided in its regulations,” and the r ule controllingthe time limit s under whic h a party may alleg e tar g eted dumping , absent a showing of g ood cause , is no ex ception. See Y antai Timken Co., Ltd. v. United States , 31 CI T ___, ___, 521 F. Supp. 2d 1356, 1371 (2007) . Her e, Plaintiff-Interve nors did not raise a lleg ations of targ eted dumpingin the orig inal investigation, but instead first asser

ted them duringthe Section 129 proc eeding , sever al y ear s after the conclusion of the or igina l investigation. I n decliningto examine the targ eted dumping alleg ations, Commerce r ightly explained that “there was ample time during the orig inal investigation[ ] for domestic interested pa rties to analy

ze the response s and make targ etedConsol. Court No. 07-00170 P age 28

As a matter

of fa ct, the issue of positive and ne g ative value dumping mar g ins was 19 alre ady a topic for

discussion in administ rative a nd judicial fora

at the time of the or igina l investigation on the subject merc handise. See , e.g. , Bowe Passat Reinigungs-Und W aschere itechnik Gm bh v. United States , 20 CI T 558, 570-72, 926 F . Supp. 1138, 1149-50 (1996). dumping a lleg ations.” Section 129 De termination Issues and Dec ision Memorandum at 14. Put simply , Nucor

and Ar celorMittal mi ssed a de adline cle arly stated in the per

tinent regulation, and beca use no g ood cause excuses their tardine ss, Comm erc e cor rec tly disreg arde d their targ eted dumping c laims in the Section 129 procee ding. That Nuc or and A rce lorMittal relied on the c ontinued application of Commerc e’s zeroing methodology

to acc ount for any

targ eted dumpingdoes not serve as a g ood cause to toll t he deadline, nor

does it sugg est that Commerce acte d arbitra rily here in denying the PlaintiffInterve nors’ re quest. I mportantly , Commerce’ s modification of its methodology for c alculating 19 weig hted-avera g e dumping marg ins in certain investig ations addre sses provisions that are distinct and independe nt from those discussing targ eted dumping . Commerce limited the Section 123 Determ ination to those particular investigations that were the subject of the Pa ne l R e po rt and all then pe nding a

nd future inve stigations, wherea s the targ eted dumpingprovisions conce rn those situations where a

fore ign e x porter or

produce r selec tively

sells mercha

ndise at less than f a i r v a l u e i nc e rt a i np r o d

u c tl i n e s , t o c e rt a i nc u s t o m e r s , r e g i o n s , o r a tc e rt a i nt i m e s o f

th e y e ar . In other wor ds, the Section 123 De termination did no t a ff e c t th e targ e te d d

ump ingsc he me , a

nd if the domestic intere sted parties be lieved that tar g eted dumpinghad occ urre d, they had the opportunity

to make such a

n alleg ation in a timely

manner duringthe initial investigation. The failure to make such a

claim bec ause it would have been “ pointless” is hardly a re ason forConsol. Court No. 07-00170 P age 29

Commerce to f

ind good c ause to e x tend the dea dline. SeeNu c or Summ. J. B r. 24 . E ve n if it would have be en diffic ult for Plaintiff-Interve nors to demonstrate one of the ne cessa ry prer equisites to show targ eted dumping , difficulty has neve r bef

ore f orec losed a pa

rty from
makin g su c h a

c la im o r b e e n a

re a so n to e xcu se the tim e ly ra isi ngof

that c la im. Another important c onsideration her e is that Nucor and Ar celorMittal’s claim of targ eted dumping doe s not fit within t he scope of the Section 129 De termination . Co mme rc e e xplic itl y state d th a t th e so le purp os e fo r i nit iatin g the Se c tio n 1 29 pr oc e e din g wa s to c on fo rm c e rt a in ag ency deter minations with t he finding s in the Panel Report. Se e Sec tion 129 Determination , 72 F e d. Re g . at 25 ,2 62 . M or e sp e c if ic a lly , Co mme rc e no te d th a t in the Se c tio n 1 29 pr oc e e din g it soug ht only

to rec alculate the weig hted-avera g e dumping marg in for the e ntries of g oods subject to particular

antidumping investig ations using a new methodolog y

– offse tting – desc ribed in the Section 123 De termination
. Se e id . “It is unclear whether Congr ess intended to limit the scope of [S] ection 129 [of the URAA] to include only issues found to violate the WTO agree ments or to more broa dly

include other

potential issues,” and that is precisely the kind of ambiguity

that require s the court to g ive Commerce due def ere nce unde r Chevron to rea sonably interpre t the statute at issue. ThyssenKrupp Acciai Spec iali, T erni S.P.A. v. U

nited States , 33 CI T ___, ___, 602 F. Supp. 2d 1362, 1367 (2009). T he limited scope of the Section 129 De termination is i n harmony with the overr eac hing g oal of the statute – to make the ag ency deter mination at issue consistent with the nation’s international trade oblig ations – and is there fore a re asonable rea ding of Section 129 of the U RAA. See Thysse nKrupp Acciai Spec iali, T erni S.P.A. , 33 CI T at ___, 602 F. Supp. 2d at 1367-68. Eve n though Commerc e conside red Nucor a nd Arc elorMittal’sConsol. Court No. 07-00170 P age 30

conce rns on targ eted dumping , the ag ency was not re quired to do so in making the Section 129 Determ ination , a

nd the re fo re it a c te d r e a so na bly in d e c lin ingto v e ri fy

su c h a lle g a tio ns . F ina lly , A rc e lorMitta l’ s c la im that Co mme rc e ha s a c te d in c on sis te ntl y wi th i ts p a st prac tice is meritless. Even a ssuming that Commerce ’s other Sec tion 129 procee dings a re fa c tua lly ide nti c a l to the c a se he re , a s a matte r o f l aw, e a c h a g e nc y de te rm inatio n is su i ge ne ris , involving a unique combination and intera ction of many varia bles, and ther efor e a pr ior administrative deter

mination is not leg ally

binding on other

revie ws befor e this court. See Nuc or Corp. v. United States , 414 F.3d 1331, 1340 ( Fe d. Cir. 2005). Ther efor e, for the af oreme ntioned
rea sons, Comm erc e re asonably reje cted the a lleg ations of Nucor and Ar celorMittal reg arding targ eted dumpingin the Section 129 De termination
. IV. Conclusion Con g re ss’ s inte nt a

nd pu rp os e on the iss ue of

of fs e tti ngc ann ot b e un ambi g uo us ly
a sc e rt a ine d und e r t

he se ve ra l anti dumpi nglaws . T he re fo re , th e c ourt mus t a ff or d d e fe re nc e to Commerce’ s interpre tation of the statutes at issue so longas the a g ency ’s re adingis permissible. The c ourt finds that Commerce proper ly followed the pr ocedur es set for th in § 3533(g ) to amend a pra ctice that was found to be inc onsistent with the nation’s trade oblig ations. The ag ency ’s construction of the pertinent statutes a nd justification theref

or ar e both per suasive and
re a so na ble , a nd thu s th e c ourt

ho lds that Co mme rc e ’s Section 123 De termination and the Section 129 Determ ination are in acc ordanc e with law. The court a lso affirms Commerc e’s de te rm inatio n n ot t o c on sid e r c la ims of targ e te d d

ump ingbe c a

us e su c h a lle g a tio ns we re un tim e lyConsol. Court No. 07-00170 P age 31

and outsi de the sc op e of

the Se c tio n 1 29 pr oc e e din g , a nd be c a us e the re is n o g oo d c a

us e to
e xcu se the ir

tard y c la im.

D a t e d : J u l y 2 0 , 2 0 0 9 / s /J u d i thM
. B ar z i l ay Ne w Y o rk , NY J u d i thM
. Barz i l ay , J u d ge