SLIP OP. 99-40 

UNITED STATES COURT OF INTERNATIONAL TRADE

 

UNION CAMP CORPORATION, :

:

Plaintiff, :

: BEFORE: Wallach, Judge

v. : Consol. Court No. 97-03-00483

:

THE UNITED STATES, : PUBLIC VERSION

:

Defendant, :

:

and :

:

DASTECH INTERNATIONAL, INC., et al., :

:

Defendant-Intervenors. :

 :

[Remanded in part.]

Decided: April 29, 1999

Fenwick & West, LLP (Roger M. Golden and Phyllis E. Andes) for Plaintiff.

David Ogden, Acting Assistant Attorney General; David M. Cohen, Director; U.S. Department

of Justice, Civil Division, Commercial Litigation Branch, (Lucius B. Lau); Keun Ho Bae, Office

of the Chief Counsel for Import Administration, U.S. Department of Commerce, Of Counsel, for

Defendant.

Williams, Mullen, Christian & Dobbins, P.C., (William E. Perry and W. David Snead) for

Defendant-Intervenors.
Consol. Court No. 97-03-00483 Page 2

OPINION

I

INTRODUCTION

At issue in this case is the proper surrogate value for octanol-2, a subsidiary product of

the sebacic acid production process, that is to be used by the International Trade Administration

of the U.S. Department of Commerce ("ITA" or "Commerce") in its first administrative review

of antidumping duties on sebacic acid from the People's Republic of China ("PRC"). See

Sebacic Acid from the People's Republic of China; Final Results of Antidumping Duty

Administrative Review, 62 Fed. Reg. 10,530 (1997) ("First Administrative Review"). This case

is before the Court for the second time, following the Court's Memorandum and Order of March

27, 1998, ("Remand Memorandum" and "Remand Order"), directing Commerce, inter alia, to

"value octanol-2 based on an appropriate cost (which may be the U.S. cost but which may not be

based solely on similar molecular structure without any additional evidence) of crude octanol-2,

and then recalculate the by-product/co-product determination with the correct value." Union

Camp Corp. v. United States, 8 F. Supp.2d 842, 853 (CIT 1998). Commerce issued its remand

determination on June 25, 1998. See Remand Determination: Union Camp Corporation v.

United States (Consol. Court No. 97-03-00483) ("Remand Determination"). The parties

subsequently submitted their respective comments on the Remand Determination, and

Defendant-Intervenors' submitted a motion asking the Court to reconsider its Remand Order

("Motion To Reconsider"). 

For the reasons stated herein, the Court agrees with Defendant-Intervenors and finds that

its Remand Order was ambiguous, in so far as Commerce interpreted the Remand Order as

preventing it from considering record evidence of market prices in valuing the octanol-2 that

results from the sebacic acid production process. Accordingly, the Court grants DefendantIntervenors' Motion To Reconsider and remands this case for further consideration consistent

with this opinion. In doing so, however, the Court takes judicial notice of the fact that in its third

administrative review of antidumping duties on sebacic acid from the PRC, Commerce, on the

basis of a letter from the editor of the Chemical Weekly (India), reversed its previous position

and found that the "octanol" quote from this publication did not refer to octanol-1. See Sebacic

Acid From The People's Republic of China; Final Results of Antidumping Duty Administrative

Review, 63 Fed. Reg. 43,373, 43,374-75 (1998) ("Third Administrative Review"). Having taken

judicial notice of this fact, the Court directs Commerce to consider the letter from the editor of

the Chemical Weekly (India) in choosing an appropriate surrogate value on remand. 

 

Finally, the Court further instructs Commerce that it is to consider whether it should

accept new evidence concerning the comparability of 2-ethylhexanol and octanol-2. Should

Commerce come to the conclusion that it should accept such evidence, Commerce may do so

and, if appropriate, use that evidence as a basis for justifying its use of the Chemical Weekly
Consol. Court No. 97-03-00483 Page 3

(India) value for "octanol" as a surrogate value.

II 

BACKGROUND

The relevant facts of this case are described in Union Camp Corp. v. United States, 8 F.

Supp.2d 842 (CIT 1998), and familiarity with them is presumed. Only the facts relevant to the

disposition of Defendant-Intervenors' Motion To Reconsider are repeated.

On March 7, 1997, Commerce issued its First Administrative Review, covering

shipments of sebacic acid from the PRC to the United States during the period July 13, 1994,

through June 30, 1995. First Administrative Review, 62 Fed. Reg. at 10,530. Because the PRC

is a nonmarket economy, Commerce determined the "normal value" of the sebacic acid using a

constructed value pursuant to 19 U.S.C. § 1677b(c)(1) (1994), which provides that, where

appropriate, Commerce "shall determine the normal value of the subject merchandise on the

basis of the value of the factors of production utilized in producing the merchandise." In valuing

the factors of production, Commerce is to use, where possible, "prices or costs . . . in one or

more market economy countries" that are at a comparable level of economic development and

that are "significant producers of comparable merchandise." 19 U.S.C. § 1677b(c)(4) (1994) 

For the First Administrative Review, Commerce used surrogate values from India to

construct the normal value of the sebacic acid. See First Administrative Review, 62 Fed. Reg. at

10,533. In doing so, Commerce used a published price for "octanol" from the Chemical Weekly

(India) to value the octanol-2 that is produced, as a subsidiary product, through the sebacic acid

production process. See id. at 10,534-35. Although the "octanol" quote from the Chemical

Weekly (India) does not make clear whether it refers to octanol-2 or another type of octanol,

Commerce assumed that this price was for octanol-1 and concluded that octanol-1 was a

comparable product to octanol-2. See id. at 10,534. Commerce's only explanation as to how the

two products were comparable, however, was that they have similar molecular formulae. See id. 

Before this Court, Plaintiff challenged Commerce's conclusion concerning the

comparability of octanol-1 and octanol-2, arguing that the decision was not supported by

substantial evidence on the record and not otherwise in accordance with law. See Brief In

Support Of Union Camp Corporation's Rule 56.2 Motion For Judgment Upon The Agency

Record, dated September 5, 1997, at 19-21. On March 27, 1998, the Court agreed with Plaintiff

and found that Commerce's interpretation of the word "comparable" in 19 U.S.C. § 1677b(c)(4)

(1994), to mean similar molecular structure, was not a reasonable interpretation of the statute. 

Union Camp, 8 F. Supp.2d at 849. The Court stated that Commerce "must either provide an
Consol. Court No. 97-03-00483 Page 4

explanation for how octanol-1 is comparable to octanol-2 based on some acceptable standard

[value or use] or it must offer a reasonable explanation of why it is changing its legal standard for

such determinations." Id. In regard to Commerce's conclusion also being unsupported by

substantial evidence, the Court stated:

Commerce discussed its reason for selecting the Indian value of octanol-2, i.e., the

similar molecular formulae. It also discussed why it rejected Union Camp's

internal cost of octanol-2 based on Commerce's preference for public, published

information. Commerce failed to discuss, or apparently consider, however, the

U.S. value of octanol-2 placed on the record by Dastech or Union Camp's

submission regarding an adjustment of that U.S. value to reflect that Dastech 's

submission reflected the value of refined octanol-2. . . . Thus, Commerce's failure

here to consider the other surrogate values placed on the record results in its

valuation of octanol-2 using the Indian value of octanol-1 being unsupported by

substantial evidence on the record.

Id. at 850 (citation omitted).

In light of these findings, the Court remanded this case to Commerce with the following

instructions:

[I]t is hereby . . . ORDERED ADJUDGED AND DECREED that this case is

remanded to [Commerce] with instructions to value octanol-2 based on an

appropriate cost (which may be the U.S. cost but which may not be based solely

on similar molecular structure without any additional evidence) of crude octanol2, and then recalculate the by-product/co-product determination with the correct

value . . . .

Id. at 853.

On June 25, 1998, Commerce issued its Remand Determination, in which it used Union

Camp's internal cost for crude octanol-2 as a surrogate for the octanol-2 produced by DefendantIntervenors. Remand Determination at 3, 9-10. Even though Commerce identified and discussed

additional record evidence that supported its use of the Chemical Weekly (India) value of refined

octanol -- and commented that this value "is the best available information to effectuate the

Department's goal of determining the most accurate margin possible," Remand Determination at

6 -- it nevertheless stated that it felt constrained by the Court's Remand Order from using or

considering other possible surrogate values that were on the record. Commerce stated that:
Consol. Court No. 97-03-00483 Page 5

1

 The only direct discussion of the Chemical Marketing Reporter (U.S.) values occurs on

pages 8 and 9 of the Remand Determination, where Commerce discussed Defendant-Intervenors'

contention that the 36 percent price difference between the octanol-1 and octanol-2 values in the

Chemical Marketing Reporter (U.S.) would reflect a similar price difference in the Indian

market. In response to this observation, Commerce simply reiterated that although it believed

the Chemical Weekly (India) value to be the most appropriate surrogate, it was nevertheless

using Union Camp's cost information to value octanol-2 "in accordance with the Court's

instructions." Remand Determination at 9. 

The Department is using the U.S. cost of crude octanol-2 to recalculate the

dumping margins because the court instructed us to value octanol-2 based on an

appropriate "cost" of crude octanol-2 and the only value on the record for "cost"

of crude octanol-2 is the petitioner's U.S. cost of crude octanol-2. The

Department's use of such a value necessitates a recalculation of the dumping

margins. However, the Department has also identified for the court additional

record evidence that octanol-1 and octanol-2 are comparable in use. It remains

the Department's position, as reflected in the determination on remand, that using

the petitioner's U.S. cost of crude octanol-2 is inappropriate because it results in

less accurate dumping margins.

Remand Determination at 10. See also Defendant's Response To The Comments Filed By Union

Camp And Dastech Regarding The Remand Determination Filed by The Department of

Commerce ("Defendant's Response") at 3 ("Commerce did not utilize the data contained in

Chemical Weekly (India) because this Court's remand order specifically instructed the agency to

'value octanol-2 based on an appropriate cost . . . .'"). In so finding, Commerce again did not

consider the U.S. prices from the Chemical Marketing Reporter (U.S.) for octanol-2 that were

placed on the record by Defendant-Intervenors. Presumably, Commerce concluded that, as the

value reported in the Chemical Marketing Reporter (U.S.) reflects a market price for refined

octanol-2, it was precluded from considering this figure by the Court's Remand Order. See

Remand Determination at 3, 8-10.1 In addition, although Commerce reasserted its position that

the Chemical Weekly (India) value for "octanol" is the "best available information," it also did

not identify any record evidence on remand to confirm exactly what product (octanol-1, octanol2 or some other product) was being referenced by this figure. See Remand Determination at 6

("[G]iven that the Chemical Weekly (India) does not specify a particular type of octanol, we

believe that evidence on the record suggests that the refined octanol price listed in the Chemical

Weekly (India) is a reasonable surrogate value for octanol-2.")

Using Union Camp's internal cost of crude octanol-2 (10.372 Indian rupees per kg / $0.15

per lb) as the surrogate, Commerce concluded that octanol-2 is a by-product of the sebacic acid
Consol. Court No. 97-03-00483 Page 6

2

 To determine the correct accounting treatment of a subsidiary product, Commerce

examines, in accordance with generally accepted accounting principles (GAAP), whether the

value of a subsidiary product is significant or insignificant relative to the other products that

result from a particular production process. See Remand Determination at 3-4; Preliminary

Determination of Sales at Less Than Fair Value and Postponement of Final Determination: 

Sebacic Acid From the People's Republic of China, 59 Fed. Reg. 565, 569 (1994) ("By-products

are identified by their relatively insignificant sales value, whereas [co-products] . . . generally

have significant sales value relative to the product under investigation."); Elemental Sulphur

From Canada; Final Results of Antidumping Finding Administrative Review, 61 Fed. Reg.

8,239, 8,241-42 (1996) (identifying several factors Commerce examines to determine the relative

significance of a particular subsidiary product). For calculating normal value, Commerce

subtracts the sales revenues of by-products from the production costs of the main product. See

Preliminary Results, 61 Fed. Reg. at 46,443. In contrast, if Commerce determines that a

subsidiary product is a co-product, it will allocate production costs between the main product and

the co-product. See id.

production process, "because the overall value of octanol-2 is insignificant relative to the value

of sebacic acid and the other subsidiary products." Remand Determination at 4. In so finding,

Commerce reversed its previous conclusion that, based on the Chemical Weekly (India) value for

octanol-1 of 76 Indian rupees per kg, octanol-2 should be treated as a co-product for cost

accounting purposes. See First Administrative Review, 62 Fed. Reg. at 10,533-35; Sebacic Acid

from the People's Republic of China; Preliminary Results of Antidumping Duty Administrative

Review ("Preliminary Results"), 61 Fed. Reg. 46,440, 46,443 (1996).2

Because Commerce claimed that the language of the Court's Remand Order

inappropriately constrained its consideration of appropriate surrogate values, on July 27, 1998,

Defendant-Intervenors submitted a motion asking this Court to reconsider its Remand Order. 

According to Defendant-Intervenors, because either the Remand Order or Commerce's reading of

the Remand Order was "manifestly erroneous," "[Commerce] has issued an unfair and inaccurate

determination which is directly contrary to the statute, the legislative history, prior court cases

and generally accepted accounting principles." Defendant-Intervenors' Comments On The

Commerce Department's Remand Determination And Memorandum In Support Of Motion For

Reconsideration ("Reconsideration Memorandum") at 1, 33. In response, Plaintiff asserts that

Defendant-Intervenors' argument that a refined octanol value can be an appropriate surrogate is

untimely, that Union Camp has not manipulated its price of crude octanol-2, that Union Camp's

cost of crude octanol-2 is fair, that use of certain statements concerning the comparability of

octanol-1 and octanol-2 are unreliable, and that deference to Commerce supports sustaining the

Remand Determination. Plaintiff Union Camp Corporation's Rebuttal Comments And Response

In Opposition To Defendant-Intervenors' Motion For Reconsideration ("Plaintiff's Response") at

3-6. Plaintiff also argues that Defendant-Intervenors' Motion For Reconsideration is untimely
Consol. Court No. 97-03-00483 Page 7

under USCIT R.59 and that Defendant-Intervenors have failed to state any substantive grounds

under USCIT Rs.59 and 60 that would justify granting the Motion For Reconsideration. Id. at 7-

13. 

For its part, Defendant says that, "[a]s is apparent from the Remand Determination,

Commerce carefully examined this Court's remand order, concluded that the Court's use of the

word 'cost' was deliberate, and, as a result, valued octanol-2 based upon the 'cost' of crude

octanol-2." Defendant's Response at 2. Since Commerce complied with the Court's Remand

Order, Defendant argues, "the Court should sustain the remand results, enter final judgment, and

dismiss the action." Id. Defendant also notes, however, that Commerce "would be willing to

undergo another remand so that it may utilize the Chemical Weekly (India) price." Id. at 4.

Independent from, and subsequent to, Commerce's First Administrative Review and the

Remand Determination, on August 13, 1998, Commerce published the final results of its Third

Administrative Review, covering the period July 1, 1996, through June 30, 1997. Third

Administrative Review, 63 Fed. Reg. at 43,373. In that review, the respondents submitted a

letter written by the editor of the Chemical Weekly (India) stating that the "octanol" value in the

Chemical Weekly (India) refers to 2-ethylhexanol. Id. at 43,374. Though apparently a type of

octanol, 2-ethylhexanol appears to be a distinct product from octanol-1 and octanol-2. Id. at

43,374-75. Based on this letter and other record evidence concerning similar uses, Commerce

concluded that 2-ethylhexanol and 2-octanol are comparable merchandise and, accordingly,

found that the Chemical Weekly (India) price for "octanol" is the most appropriate surrogate for

valuing octanol-2. Id. at 43,375. 

III 

DISCUSSION

A

Standard Of Review

The Court “shall hold unlawful any determination, finding, or conclusion found . . . to be

unsupported by substantial evidence on the record, or otherwise not in accordance with law.” 19

U.S.C. § 1516a(b)(1)(B)(i) (1994). Substantial evidence is something more than a "mere

scintilla," and must be enough evidence to reasonably support a conclusion. Primary Steel, Inc.

v. United States, 17 CIT 1080, 1085, 834 F. Supp. 1374, 1380 (1993) (quoting Ceramica

Regiomontana, S.A. v. United States, 10 CIT 399, 405, 636 F. Supp. 961, 966 (1986), aff'd., 810
Consol. Court No. 97-03-00483 Page 8

F.2d 1137 (Fed. Cir. 1987)). "As long as the agency's methodology and procedures are

reasonable means of effectuating the statutory purpose, and there is substantial evidence in the

record supporting the agency's conclusions, the court will not impose its own views as to the

sufficiency of the agency's investigation or question the agency's methodology." Ceramica

Regiomontana, S.A., 10 CIT at 404-5, 636 F. Supp. at 966.

In reviewing an agency’s construction of the statute that the agency administers, the

Court's initial inquiry is to determine “whether Congress has directly spoken to the precise

question at issue." Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S.

837, 842 (1984). "If Congress has explicitly left a gap for the agency to fill, there is an express

delegation of authority to the agency to elucidate a specific provision of the statute by

regulation." Id. at 843-44. Consequently, “[t]he court will defer to the agency's construction of

the statute as a permissible construction if it ‘reflects a plausible construction of the plain

language of the statute[s] and does not otherwise conflict with Congress' express intent.’" 

Torrington Co. v. United States, 82 F.3d 1039, 1044 (Fed. Cir. 1996) (citing Rust v. Sullivan,

500 U.S. 173, 184 (1991)).

B

The Court Grants Defendant-Intervenors' Motion For Reconsideration.

1

The Court Considers Defendant-Intervenors' Motion 

For Reconsideration Under USCIT R. 59.

Although, on its face, USCIT R. 59 provides only for "[a] new trial or rehearing . . . in an

action tried without a jury or in an action finally determined," it has been well-recognized that

the concept of a new trial under this Rule is broad enough to cover a rehearing of any matter

decided by the Court. Nat'l Corn Growers Ass'n v. Baker, 9 CIT 571, 584, 623 F. Supp. 1262,

1274 (1985), rev'd on other grounds 840 F.2d 1547 (Fed. Cir. 1988) (quoting Timken Co. v.

United States, 6 CIT 76, 76, 569 F. Supp. 65, 67 (1983), (quoting 11 Charles Alan Wright &

Arthur R. Miller, Federal Practice and Procedure § 2804 at 35 (1973))). Accordingly, the Court

will consider Defendant-Intervenors' Motion For Reconsideration in light of USCIT R. 59.

As this Court has previously noted, the grant of a motion for reconsideration is within the

sound discretion of the Court. Union Camp v. United States, 963 F. Supp. 1212, 1213 (1997)

(citing Kerr-McGee Chem. Corp. v. United States, 14 CIT 582, 583 (1990)). "The purpose of a
Consol. Court No. 97-03-00483 Page 9

3

 USCIT R. 59(b) provides for a 30-day period within which to move for a new trial or

rehearing. In contrast, Fed. R. Civ. P. 59(b) provides only for a 10-day period. The lengthier

period is required by 28 U.S.C. § 2646 (1994), a statute only applicable to the Court of

International Trade.

rehearing is not to relitigate a case," but to rectify a significant flaw in the conduct of the original

proceedings. Kerr-McGee, 14 CIT at 583 (citations omitted). Although specific grounds upon

which a court may grant such a motion are not listed in the Rule, it is well established that a

motion for reconsideration should be granted, and the underlying judgment or order modified,

when a movant demonstrated that the judgment is based on manifest errors of law or fact. See 11

Charles Alan Wright, Arthur R. Miller and Mary Kay Kane, Federal Practice and Procedure §

2810.1 at 125 (2nd ed. 1995) ("[T]he movant may demonstrate that the motion is necessary to

correct manifest errors of law or fact upon which the judgment is based.")

While a motion for reconsideration is to be considered under the standards of USCIT

R.59, it is clear that, in this instance, the time limit set out in USCIT R. 59(b) does not prevent

this Court from properly considering Defendant-Intervenors' Motion For Reconsideration. Under

USCIT R. 59(b), "[a] motion for a new trial or rehearing shall be served and filed not later than

30 days after the entry of judgment or order." Citing this Rule, Plaintiff argues that this Court

lacks jurisdiction to hear Defendant-Intervenors' Motion For Reconsideration, since it was filed

on July 27, 1998 -- 121 days after the Remand Order was entered and 91 days after the 30 day

time limit expired. Plaintiff's Response at 6-7. 

Contrary to Plaintiff's claim, however, the 30 day time limit of USCIT R. 59(b) does not

render this Court without jurisdiction to hear the Motion For Reconsideration. As this Court and

others have held, the time limit set out in USCIT R. 59(b) and the corresponding rule of federal

civil procedure, Fed. R. Civ. P. 59(b),3

 only apply to final judgments or orders. See Timken, 6

CIT at 78, 569 F. Supp. at 68; Bohack Corp. v. Iowa Beef Processors, Inc., 715 F.2d 703, 712

n.10 (2d Cir. 1983); Warner v. Rossignol, 513 F.2d 678, 684 n.3 (1st Cir. 1975); Manos v. Trans

World Airlines, Inc., 324 F. Supp. 470, 488 (N.D. Ill. 1971); Graci v. United States, 301 F. Supp.

947, 950 (E.D. La. 1969), aff'd 456 F.2d 20 (5th Cir. 1971). Cf. Garrett v. Blanton, 1993 WL

17697, at * 3 (E.D. La. 1993) (holding that "an interlocutory judgment on liability issues is not a

'judgment' for purposes of [Fed. R. Civ. P] 59"); O. Hommel Co. v. Ferro Corp., 659 F.2d 340,

353-54 (3d Cir. 1981) (finding that a judgment for purposes of Fed. R. Civ. P 50(b) is not final

until attorney's fees have been determined). In contrast, a motion for reconsideration of an

interlocutory order "is proper at any time prior to the final determination of the merits." Timken,

6 CIT at 78, 569 F. Supp. at 68 (quoting Graci, 301 F. Supp. at 950). As explained by Wright,

Miller and Kane:
Consol. Court No. 97-03-00483 Page 10

4

 In footnote 2 of its Response, Plaintiff notes that, "[w]hether the Order is a 'final

judgment' or not is irrelevant to application of USCIT R.59. The rule is not restricted to final

judgments or orders but applies to any judgments or orders." Plaintiff's Response at 7 n.2

(citation omitted). As the discussion above makes clear, this assertion is simply incorrect. 

Because the authority cited by Plaintiff (Belfont Sales Corp. v. United States, 12 CIT 916, 698 F.

Supp. 916 (1988), aff'd 878 F.2d 1413 (Fed. Cir. 1989)), Plaintiff's Response at 7, involved a

final order in a classification case, the case is inapposite to the facts at bar. 

The reason for a short time limit on motions for a new trial is to promote finality of

judgments. That policy is not applicable to an interlocutory order, which by hypothesis is

not final and is subject to modification by the court at any time before judgment is

entered. Thus, it has been held that the time limits of Rule 59 do not apply to a motion

seeking a new trial in connection with an interlocutory judgment.

Charles Alan Wright, Arthur R. Miller and Mary Kay Kane, Federal Practice and Procedure §

2812 at 143 (2d ed. 1995)

 

There is no debate as to the interlocutory nature of the Court's Remand Order. As the

Federal Circuit has made clear, as a general rule "an order remanding a matter to an

administrative agency for further findings and proceedings is not final." Cabot Corp. v. United

States, 788 F.2d 1539, 1542 (Fed. Cir. 1986) (remand to Commerce is not an appealable final

judgment); accord Badger-Powhatan, A Division Of Figgie Int'l, Inc. v. United States, 808 F.2d

823, 825 (Fed. Cir. 1986); Jeannette Sheet Glass Corp. v. United States, 803 F.2d 1576 (Fed. Cir.

1986). While it is true that "remands are not all of the same nature" and that a remand can be 

considered a final judgment in certain circumstances, Travelstead v. Derwinski, 978 F.2d 1244,

1249 (Fed. Cir. 1992), nothing in the nature or terms of the Court's Remand Order made this a

final judgment. According to the terms of the Remand Order, after Commerce complied with the

Court's instructions, the parties were allowed to submit to the Court both initial and rebuttal

comments on Commerce's Remand Determination. See Union Camp, 8 F. Supp.2d at 853. 

Further, upon reviewing these comments, this Court retained the discretion to either remand this

case for yet further consideration by Commerce or affirm the Remand Determination. Given

these facts, the Court's Remand Order is interlocutory and, as such, is subject to modification by

the Court notwithstanding the 30 day time limit of USCIT R. 59(b).4

 
Consol. Court No. 97-03-00483 Page 11

2 

On Remand, Commerce May Use an Appropriate "Cost," "Value" 

or "Price" for Octanol-2 in Making its By-Product / 

Co-Product Determination.

As noted earlier, in the initial Remand Order the Court instructed Commerce, "to value

octanol-2 based on an appropriate cost . . . of crude octanol-2." Union Camp, 8 F. Supp.2d at

853 (emphasis added). In its Reconsideration Memorandum, Defendant-Intervenors essentially

argue that the Court's use of the word "cost" was manifestly erroneous, since it allowed

Commerce to claim it had to rely on Union Camp's internal, unverified cost for crude octanol-2

(the only "cost" value on the record) and ignore other, more appropriate, surrogate values that

were on the record. See Reconsideration Memorandum at 31-33, 36-38. 

The Court grants Defendant-Intervenors' Motion For Reconsideration. In its Remand

Memorandum of March 27, 1998, the Court stated that one reason the First Administrative

Review was unsupported by substantial evidence was the fact that Commerce "failed to discuss,

or apparently consider," the Chemical Marketing Reporter (U.S.) value for octanol-2 put on the

record by Defendant-Intervenors. Union Camp, 8 F. Supp.2d at 850. Since the Chemical

Marketing Reporter (U.S.) value for octanol-2 was a market price for refined octanol, the obvious

implication of this finding was that Commerce could -- and, in fact, must -- consider both "costs"

and "prices" on the record in selecting an appropriate surrogate value for octanol-2. Similarly,

the implication of the Court's holding that Commerce's use of the Chemical Weekly (India) price

for "octanol" was unsupported by substantial evidence is that, should substantial evidence be

identified on remand, Commerce could use this market price for octanol on remand. 

Despite the obvious implication of these findings, however, the Court's actual Remand

Order of March 27, 1998, stated that Commerce "was to value octanol-2 based on an appropriate

cost . . . of crude octanol-2." Union Camp, 8 F. Supp.2d at 853 (emphasis added). Simply put,

this Order was ambiguous. As specifically provided by statute, in valuing the factors of

production for constructing the "normal value" of merchandise in a non-market economy,

Commerce "shall utilize, to the extent possible, the prices or costs of factors of production" in a

comparable market economy. 19 U.S.C. § 1677b(c)(4) (1994) (emphasis added). In this case,

two market prices for octanol were placed on record by the parties and, in accordance with 19

U.S.C. § 1677b(c)(4) (1994), should have been evaluated along with Union Camp's internal

"cost" of crude octanol-2 as possible surrogate values. Commerce, however, chose to view the

Court's use of the word "cost" in a restrictive manner, and concluded that the Court's use of this

term limited its ability to consider market prices on remand. In so doing, Commerce rendered
Consol. Court No. 97-03-00483 Page 12

the Remand Order legally erroneous, since its interpretation led the Remand Order to directly

conflict with, and limit, Commerce's statutory discretion to consider prices.

Further, and again based on Commerce's restrictive interpretation, it appears that the

Court's use of the word "cost" may have prevented Commerce from using the "best available

information" in determining normal value for the sebacic acid. As required by 19 U.S.C. §

1677b(c)(1) (1994), in determining normal value in a non-market economy, "the valuation of the

factors of production shall be based on the best available information regarding the values of

such factors in a market economy . . . . " The purpose of such a requirement, of course, is to

achieve the most accurate dumping margins possible. See Tianjin Mach. Import & Export Corp.

v. United States, 16 CIT 931, 940, 806 F. Supp. 1008, 1018 (1992) ("Commerce's ability to

construct foreign market value from weighted alternatives advantageously serves the

antidumping statute's purpose of 'determining current margins as accurately as possible.'"). As

Commerce notes in its Remand Determination, however, Union Camp's internal cost for crude

octanol-2 is not the "best available information":

The Department believes that a more accurate margin results if subsidiary

products, such as octanol-2, are valued using publicly available information

reflecting actual market prices rather than the petitioner's internal cost. Thus, the

Department uses publicly available market prices whenever possible, because they

are more predictable and reliable. Publicly available values reflect actual

transactions between buyers and sellers and therefore are a more accurate

reflection of the market value of a subsidiary product. Internal cost values,

particularly those of a party in the current segment of a proceeding may be less

reliable and subject to manipulation. Moreover, in the present case, the

petitioner's internal cost information for crude octanol-2 is unverified.

Remand Determination at 4; see also id. at 6 ("[T]he Department maintains that the value for

refined octanol from The Chemical Weekly (India) is the best available information to effectuate

the Department's goal of determining the most accurate margin possible.") 

Finally, Commerce's interpretation appears to place the Remand Order in conflict with

Asociacion Colombiana de Exportadores de Flores v. United States, 6 F. Supp.2d 865 (CIT

1998) and Asociacion Colombiana de Exportadores de Flores v. United States, 13 CIT 13, 704 F.

Supp. 1114 (1989), aff'd 901 F.2d 1089 (Fed. Cir. 1990). In both these cases, this Court accepted

Commerce's methodology, which used GAAP, of (a) using market values to help determine

whether a subsidiary product is a by-product or a co-product; and (b) after determining that the

subsidiary products were by-products, offsetting the total cost of production with revenues
Consol. Court No. 97-03-00483 Page 13

5

 Ipsco, Inc. v. United States, 965 F.2d 1056 (Fed. Cir. 1992), reversed the trial court's

subsequent determination (at 13 CIT 402 (1989)) that Commerce should take sales values into

account in allocating sales between co-products. In Asociacion Colombiana, this Court made

clear that this holding should not be read as limiting Commerce's discretion to use market values,

or prices, in determining the proper cost accounting treatment for subsidiary products. See

Asociacion Colombiana, 6 F. Supp.2d at 881 ("IPSCO does not, however, as HOSA maintains,

limit Commerce's discretion to use value to distinguish between by-products and co-products.");

accord E.I. DuPont De Nemours & Co., Inc. v. United States, 932 F. Supp. 296, 302 (1996). 

earned from the sale of these by-products. See Asociacion Colombiana, 6 F. Supp.2d at 881-82;

Asociacion Colombiana, 13 CIT at 26, 704 F. Supp. at 1125; see also IPSCO, Inc. v. United

States, 12 CIT 384, 388-89, 687 F. Supp. 633, 636-37 (1988), rev'd on other grounds 956 F.2d

1056 (Fed. Cir. 1992)5 (citing various ITA investigations that looked to relative sales value as a

factor in determining whether a product is a by-product or co-product). Because there appear to

be no material facts which would distinguish, and make Commerce's methodology inappropriate

for, the facts at bar, limiting Commerce's ability to consider market prices would constitute a

repudiation of Commerce's GAAP-based methodology and the opinions of this Court which have

approved it. That was not even hinted at in the Court's Remand Memorandum. The methodology

to be employed by Commerce in determining whether octanol-2 should be treated as a byproduct or a co-product for cost accounting purposes was not an issue that was before this Court.

In short, the Court's limiting use of the word "cost" in its initial Remand Order was

ambiguous and, accordingly, subject to an interpretation that would constitute an error of law

preventing Commerce from considering potentially appropriate price data in determining

Defendant-Intervenors' dumping margins. Rather than seeking to clarify the apparent ambiguity,

however, Commerce chose to interpret it in a fashion designed to render its decision erroneous. 

For this reason, the Court remands this case to Commerce with instructions that it value the

octanol-2 that results from the sebacic acid production process based on an appropriate surrogate

value for this product, and then recalculate the by-product/co-product determination with this

correct value. This surrogate value may be a an appropriate foreign or U.S. cost or price for

comparable merchandise. As noted in the Court's Remand Memorandum and Remand Order,

however, Commerce may not determine that a particular product is "comparable merchandise"

for purposes 19 U.S.C. § 1677b (1994) based solely on a finding of similar molecular structure. 

See Union Camp, 8 F. Supp.2d at 849, 853.

On this point, it should be stressed that no value Commerce chooses as a surrogate will be

deemed supported by substantial evidence until Commerce considers the Chemical Marketing

Reporter (U.S.) value for octanol-2 put on the record by Defendant-Intervenors and either (a)

adopts it as a surrogate value, or (b) explains why it is rejecting it for these purposes. As the
Consol. Court No. 97-03-00483 Page 14

6

 This does not mean that Commerce may not use Union Camp's internal cost in valuing

octanol-2. As indicated in the Remand Memorandum, Commerce must consider and address the

appropriateness of using this value, as well as the Chemical Marketing Reporter (U.S.) value for

octanol-2, in order to have its determination supported by substantial evidence on the record. 

Union Camp, 8 F. Supp.2d at 849-50. Should Commerce determine that Union Camp's internal

cost for crude octanol-2 is the best available information, and that use of this figure is supported

by substantial evidence on the record, Commerce may use this figure as its surrogate value. 

Absent such a conclusion, however, nothing in this or the Court's initial Remand Memorandum

and Remand Order should be read as either requiring or prohibiting the use of this value.

Court specifically noted in its Remand Memorandum, in regard to Commerce's initial failure to

consider this value, "Commerce's failure here to consider the other surrogate values placed on the

record results in its valuation of octanol-2 using the Indian value of octanol-1 being unsupported

by substantial evidence on the record." Id. at 450; see also Olympia Industrial, Inc. v. United

States, 7 F. Supp.2d 997, 1001 (CIT 1998) ("Commerce has an obligation to review all data and

then determine what constitutes the best information available or, alternatively, to explain why a

particular data set is not methodologically reliable."). Accordingly, the Court further orders

Commerce, in seeking the best available information to use as a surrogate, to specifically

consider and address all alternative surrogate values that have been placed on the record --

including the Chemical Marketing Reporter (U.S.) Value for Octanol-2.6

3

If Appropriate, on Remand Commerce May Use an Unadjusted Value for "Refined"

Octanol as a Surrogate for the Octanol-2 Produced by Defendant-Intervenors.

An additional issue raised by the Remand Determination is whether Commerce may use a

value for refined octanol, without adjustment, as a surrogate for the octanol-2 produced by

Defendant-Intervenors. In its Remand Determination, Commerce stated:

The sebacic acid factors of production used to calculate normal value ("NV")

already incorporate the relatively few factors of production (labor and energy)

necessary to refine crude octanol-2. Production of sebacic acid results in the

production of crude octanol-2 as a subsidiary product. Given that the sebacic acid

factors of production already include the factors used to refine octanol-2, a more

accurate by-product/co-product analysis results by using the refined value of

octanol-2. There is no need to take a refined value of octanol-2 and then adjust it

to derive a value for crude octanol-2. Moreover, there is a publicly published

sales price on which we can base a value for refined octanol-2.
Consol. Court No. 97-03-00483 Page 15

Remand Determination at 5. 

On the basis of this logic, Defendant-Intervenors argue extensively that Commerce erred

in its Remand Determination in using Union Camp's internal cost for crude octanol-2, since

"[t]he actual production experience of the Chinese producers is that the Chinese produce refined

octanol, not crude octanol, in their production process." Reconsideration Memorandum at 11. 

Defendant-Intervenors essentially argue that since refined octanol is the actual product sold by

the Chinese producers, it is a surrogate value for this product, and not crude octanol-2, that

Commerce should use in determining whether a subsidiary product is a by-product or a coproduct. See id. at 7-18. Defendant-Intervenors observe that using such a value would be

consistent with both Commerce's prior practice and recognized accounting principles, which

provide that whether a product is by-product or a co-product is determined by the products' sales

value relative to that of the principal product or products produced (in this case, sebacic acid). 

Id. at 12-18. In fact, Defendant-Intervenors even take exception to Commerce's general

characterization that the "[p]roduction of sebacic acid results in the production of crude octanol-2

as a subsidiary product." See id. at 9 (quoting Remand Determination at 5). 

For its part, Plaintiff argues that both Commerce and Defendant-Intervenors should be

estopped from arguing for the use of a surrogate value for refined octanol, since this Court has

already determined that the product produced by the Chinese producers was crude octanol-2. 

Plaintiff's Response at 3-4. To support its point, Plaintiff observes that neither Commerce nor

Defendant-Intervenors had earlier contested its argument to use a surrogate value for crude,

rather than refined, octanol-2. Id. at 3.

In light of these various comments, two separate issues confront the Court. The first is

whether Commerce may use an unadjusted value for "refined" octanol in valuing the octanol-2

that results from the sebacic acid production process. Because this case is being remanded to

Commerce for further consideration, it would be premature for this Court to examine whether

Commerce's preference for using an unadjusted, refined value for octanol is appropriate. This is

especially true in light of Section III (C) of this memorandum, which may preclude Commerce

from using the Chemical Weekly (India) price as a surrogate upon remand. That said, however,

it should be noted that nothing in either the initial Remand Memorandum or the Remand Order

should be interpreted as either requiring or prohibiting the use of an unadjusted, refined value as

a surrogate. Rather, the Court's Remand Memorandum simply indicates that, in order to be

affirmed by the Court, Commerce's choice of a surrogate value must be supported by substantial

evidence on the record and be based on a reasonable interpretation of the term "comparable

merchandise." See Union Camp, 8 F. Supp.2d at 848-50. If, upon remand, Commerce continues

to adhere to its position that an unadjusted, refined value is the best available information to use
Consol. Court No. 97-03-00483 Page 16

as a surrogate, the Court will uphold this determination so long as it meets these standards.

The second issue that appears to have been raised is whether the subsidiary product

produced by Defendant-Intervenors should be referred to as "refined" or "crude" octanol-2. In

regard to Commerce's First Administrative Review and the parties' respective motions for

judgment on the agency record, the Court notes that there was virtually no discussion of whether

the octanol-2 at issue should be characterized as "crude" or "refined" in nature. While it is true

that Plaintiff argued in its September 25, 1997, brief that the (presumably) large price difference

between refined octanol-1 and crude octanol-2 demonstrates the inappropriateness of using

octanol-1 to value octanol-2, Plaintiff simply assumed, without specifically arguing, that the

subsidiary product was "crude" octanol-2. See Brief In Support Of Union Camp Corporation's

Rule 56.2 Motion For Judgment Upon The Agency Record, dated September 5, 1997, at 18. 

Further, since the characterization of the octanol-2 did not appear to be a point of contention

among the parties, the Court never specifically addressed the "crude" versus "refined" octanol-2

issue in its Remand Memorandum and Remand Order. Rather, the Court simply characterized

the product produced as "crude" octanol. 

In light of the foregoing, it would be incorrect to say either that this "refined" versus

"crude" issue was previously litigated, or that the Court decided this issue in its initial Remand

Memorandum and Remand Order. At this point in the litigation, it appears that the

characterization of the subsidiary product produced by Defendant-Intervenors is a non-issue. 

Whether characterized as "crude" or "refined" octanol-2, the main issue that Commerce needs to

decide is what record evidence constitutes the most appropriate surrogate value for this product. 

Even assuming, without deciding, that the product produced by Defendant-Intervenors is best

described as "crude" octanol-2, there is no particular reason why Commerce could not use a

refined price or cost in valuing this product, subject to any necessary adjustments. The

appropriateness of such action, again, would depend on whether Commerce's choice of a

surrogate value can be supported by substantial evidence on the record and based on a reasonable

interpretation of the term "comparable merchandise." 

C 

Use of the Chemical Weekly (India) Value for Octanol-2 Is Still Not 

Supported by Substantial Evidence on the Record.

As noted previously, on remand Commerce identified new evidence on common uses

between octanol-1 and octanol-2 to support its position that, notwithstanding the Court's Remand

Order, the Chemical Weekly (India) value for refined octanol was "the best available information
Consol. Court No. 97-03-00483 Page 17

7

 The Court takes judicial notice pursuant to Fed. R. Evid. 201(c), which provides, in

relevant part, that "[a] court may take judicial notice, whether requested or not." See Borlem

S.A. - Empreedimentos Industriais v. United States, 913 F.2d 933, 940 (Fed. Cir. 1990)

(upholding judicial notice of "the fact that a new and different [margin] determination has been

made based on the premise that the earlier one was incorrect"). 

to effectuate [Commerce's] goal of determining the most accurate margins possible." Remand

Determination at 6. In doing so, however, Commerce continued to assume, without verifying,

that the "octanol" value from the Chemical Weekly (India) was for octanol-1. Standing alone, 

such an assumption undermines Commerce's use of this figure, since "octanol" is a generic

phrase which covers a full range of products. In this case, however, not only does the lack of

verification call Commerce's use of this figure into question, but evidence of which this Court

may take judicial notice seems to show that Commerce's assumption is, in fact, incorrect. 

As discussed in Section II, in its Third Administrative Review, Commerce relied on a

letter from the editor of the Chemical Weekly (India) in finding that the "octanol" price from this

publication was not for octanol-1 or octanol-2, but was for a third product, 2-ethylhexanol. Third

Administrative Review, 63 Fed. Reg. at 43,374-75. This conclusion, of course, plainly

contradicts Commerce's repeated assertion that the "octanol" quote from the Chemical Weekly

(India) is for octanol-1, and it renders Commerce's evidence of overlapping uses and composition

between octanol-1 and octanol-2 superfluous. Given the apparent contradiction, and given the

likelihood that Commerce will continue to assert that the octanol price from the Chemical

Weekly (India) is the best available evidence, it is appropriate for this Court to take judicial

notice7

 of the fact that Commerce, on the basis of the letter from the editor of the Chemical

Weekly (India), reversed its position in the Third Administrative Review and found that the

"octanol" quote did not refer to octanol-1. See Third Administrative Review, 63 FR 43,374-75

("Therefore, based on the above information, and absent any substantiated record evidence to the

contrary, the Department determines that the octanol value from Chemical Weekly is for 2-

ethylhexanol.").

Having taken judicial notice of that fact, the Court orders Commerce, on remand, to open

the administrative record and consider the letter from the editor of the Chemical Weekly (India)

in its choice of an appropriate surrogate value. While the Court notes that it is not ruling on the

accuracy or significance of this new evidence, see Borlem, 913 F.2d at 940 ("[A]ll we are doing

is recognizing that new data exists that the [agency] should evaluate."), it also observes that,

unless rebutted, the existence of this evidence appears to undermine Commerce's rationale for

using the Chemical Weekly (India) "octanol" value as a surrogate. Accordingly, unless

Commerce is able to identify substantial record evidence on remand which demonstrates that,

notwithstanding the letter from the editor of the Chemical Weekly (India), the "octanol" quote
Consol. Court No. 97-03-00483 Page 18

from the Chemical Weekly (India) is actually a quote for octanol-1, Commerce may not continue

to argue for the use of this figure on the grounds that octanol-1 and octanol-2 are "comparable

merchandise." 

In arriving at this result, the Court is mindful of the considerable deference that

Commerce enjoys in its administration of the antidumping laws. Such deference, however, is not

owed when credible evidence from outside the record indicates a significant error in Commerce's

determination. See, e.g., id. (upholding remand to ITC for reconsideration of its injury

determination in light of its reliance on an ITA dumping margin that was later corrected); D&L

Supply Co. v. United States, 113 F.3d 1220, 1224 (Fed. Cir. 1997) ("[W]hen the dumping

margin on which the BIA rate is based is invalidated [in another judicial proceeding] before the

BIA rate has become final, it is irrational to ignore the invalidity of the underlying rate and to

uphold the BIA rate as purportedly based on the 'best information available.'");

Tehnoimportexport v. United States, 15 CIT 250, 258-59, 766 F. Supp. 1169, 1178 (1991)

(holding that "if the error [in ITA's calculations] was so egregious and so obvious that the failure

to correct it was an abuse of discretion and undermined the interests of justice, the Court may

remand the case to the ITA for adjustment of calculations"). 

In this regard, the Court is guided by the Federal Circuit's opinion in Borlem S.A. -

Empreedimentos Industriais v. United States, 913 F.2d 933 (Fed. Cir. 1990). Borlem involved

an International Trade Commission ("ITC") injury determination that was based, in part, on

Commerce's finding of dumping by two Brazilian manufacturers. On remand, however,

Commerce changed its position and found that the dumping margins for one of the two producers

at issue was de minimis. Taking judicial notice of Commerce's new position, this Court

remanded the injury determination back to the ITC to consider amending its injury determination

in light of Commerce's amended antidumping determination. See Borlem S.A. -

Empreedimentos Industriais v. United States, 13 CIT 535, 718 F. Supp. 41 (1989), aff'd 913

F.2d 933 (Fed. Cir. 1990). On interlocutory appeal, the Federal Circuit upheld the Court's

decision, stating explicitly that "deference is not owed to a determination that is based on data

that the agency generating those data indicates are incorrect . . . . [t]he law does not require, nor

would it make sense to require, reliance on data which might lead to an erroneous result." 

Borlem, 913 F.2d at 937. The Federal Circuit found that where significant events from outside

the record are properly brought to the Court's attention after the date of agency action, but before

the date of decision, it was proper for the Court of International Trade to take judicial notice of

such events and instruct the agency to reconsider its determination. Id. at 939. Such a result, the

Court held, is effectively "no different from a reversal and remand for reconsideration because a

fact relied on is unsupported by the evidence." Id. at 940.
Consol. Court No. 97-03-00483 Page 19

Of course, unlike the situation in Borlem, in its Remand Determination Commerce did

not actually rely on potentially erroneous data in its Remand Determination. It appears not to

have done so, however, only because of ambiguity in the Court's Remand Order. As made clear

by both its use of the Chemical Weekly (India) value in the First Administrative Review and its

statements in the Remand Determination, Commerce's clear preference is to use this price in

determining the Chinese manufacturers' dumping margins, and to justify doing so on the basis of

comparability between octanol-1 and octanol-2. Given that background, it would be

inappropriate for the Court to wait until Commerce actually used the Chemical Weekly (India)

value for octanol before instructing it to consider the new evidence from the Third

Administrative Review. Such a result would needlessly put off until a later day, and another

remand, the question of whether the Court should take judicial notice of Commerce's conclusions

in the Third Administrative Review and order Commerce to consider the letter from the editor of

the Chemical Weekly (India) in this proceeding. Where possible and proper, the Court can,

should and prefers to avoid such a waste of administrative and judicial resources. See, e.g.,

Timken Co. v. United States, 1 F. Supp.2d 1390, 1393 (CIT 1998) (setting aside a remand order

where further investigation would "unnecessarily expend limited administrative resources to

conduct additional reviews"); United States v. Gordon, 11 CIT 192, 193 (1987) (denying a

motion to vacate on the grounds that "[r]equests to vacate interlocutory opinions and orders in

dismissed cases invite a waste of judicial resources"); EAC Engineering v. United States, 9 CIT

593, 595, 624 F. Supp. 569, 570-71 (1985) (retaining jurisdiction in a classification case on the

grounds that "it would be an unnecessary waste of judicial and administrative resources to

require Customs to reliquidate the merchandise, and the plaintiff to file a second protest and

commence a new action in order to obtain judicial review").

D 

Commerce May Reopen The Administrative Record and Consider

New Evidence Concerning the Comparability of 2-Ethylhexanol and Octanol-2.

Ironically, although the letter from the editor of the Chemical Weekly (India) appears to

undermine Commerce's proffered rationale for using the Chemical Weekly (India) value for

"octanol," this and other evidence from the Third Administrative Review may provide 

alternative grounds for using this figure as a surrogate. Specifically, and as discussed previously,

in the Third Administrative Review Commerce identified evidence concerning similar physical

characteristics and uses between 2-ethylhexanol and octanol-2 to support its conclusion that these

two products are "comparable merchandise." See Third Administrative Review, 63 Fed. Reg. at

43,375. On this basis, Commerce concluded that the Chemical Weekly value for "octanol" was

an appropriate surrogate and, accordingly, used it in its by-product/co-product determination. Id.
Consol. Court No. 97-03-00483 Page 20

Recognizing the existence of such evidence and the conclusions that might be drawn

from it, this Court is confronted with the issue of whether Commerce should be allowed, or even

ordered, to consider evidence concerning the comparability of 2-ethylhexanol and octanol-2 on

remand. Such a result would seem a natural corollary to the fact that this Court is already

ordering Commerce to consider the letter from the editor of the Chemical Weekly (India), and it

would give Commerce an opportunity to use a preferred form of evidence, publically available

information from a comparable, developing economy, in its final determination. See 19 CFR

353.52(b) (1997) (establishing a hierarchy of surrogates that is to be used in determining a

constructed value for the "normal price" of a product). Further, ordering Commerce to consider

this evidence would not constitute a waste of governmental resources, since this case is already

being remanded on other grounds, and much of the evidence that will need to be evaluated by

Commerce was the subject of its Third Administrative Review. Cf. Tehnoimportexport, 15 CIT

at 260, 766 F. Supp. at 1179 ("Since the case is being remanded for recalculation of packing

costs, the Court finds that this additional calculation [correcting an earlier error] will not

overburden the agency and will advance the interests of justice and yield a more accurate

result."). 

Set against these reasons for allowing Commerce to consider new evidence on the

comparability of 2-ethylhexanol and octanol-2, however, are various considerations concerning

the timely submission of evidence. By ordering Commerce to open the administrative record and

consider the letter from the editor of the Chemical Weekly (India), the Court seeks to prevent

Commerce from relying on what appears to be an erroneous factual assumption. In contrast,

directing Commerce to consider new evidence concerning similar uses between 2-ethylhexanol

and octanol-2 would allow it to proffer a new explanation, based on evidence outside the original

record, as to why the Chemical Weekly (India) value for "octanol" is an appropriate surrogate. 

Neither the letter from the editor of the Chemical Weekly (India), nor evidence of overlapping

uses between 2-ethylhexanol and octanol-2 were put on the record of this proceeding by

Defendant-Intervenors. Accordingly, should Commerce consider such evidence, DefendantIntervenors would stand to benefit from evidence that it did not submit during the relevant time

period of the First Administrative Review. 

In light of these conflicting policy considerations, the Court, under the doctrine of

primary jurisdiction, finds it appropriate to let Commerce determine whether it should consider

evidence concerning the comparability of 2-ethylhexanol and octanol-2 on remand. Under the

primary jurisdiction doctrine, a court may refer certain matters involving agency expertise back

to the agency so that it may, in the first instance, apply its specialized knowledge and experience

to the question at hand. See Borlem S.A. - Empreedimentos Industriais v. United States, 13 CIT

231, 234, 701 F. Supp. 797, 800 (1989). In United States v. Western Pacific Railroad Co., 352
Consol. Court No. 97-03-00483 Page 21

U.S. 59, 64 (1956), the Supreme Court set out guidelines concerning the scope of this doctrine. 

Although the Court stated that "[n]o fixed formula exists for applying the doctrine of primary

jurisdiction," it also made clear that "[i]n every case the question is whether the reasons for the

existence of the doctrine are present and whether the purposes it serves will be aided by its

application in the particular litigation." Id. at 64 (1956). Among the well-recognized reasons for

this doctrine, the Court noted, were the desire for administrative uniformity and respect for the

"expert and specialized knowledge" of agencies in their fields of competence. Id. at 64-65. As

the Court noted:

Uniformity and consistency in the regulation of business entrusted to a particular

agency are secured, and the limited functions of review by the judiciary are more

rationally exercised, by preliminary resort for ascertaining and interpreting the

circumstances underlying legal issues to agencies that are better equipped than

courts by specialization, by insight gained through experience, and by more

flexible procedure.

Id. at 64 (quoting Far East Conference v. United States, 342 U.S. 570, 575 (1952). 

In Borlem, this Court further clarified that "it would be inappropriate to invoke the

doctrine of primary jurisdiction were the question before the Court entirely one of statutory

interpretation." Borlem, 13 CIT at 237, 710 F. Supp. at 802. See also Great Northern Railway

Co. v. Merchants Elevator Co., 259 U.S. 285, 291 (1922) ("To determine what rate, rule or

practice shall be deemed reasonable for the future is a legislative or administrative function. To

determine whether a shipper has in the past been wronged by the exaction of an unreasonable or

discriminatory rate is a judicial function.") Rather, primary jurisdiction is appropriately invoked

where the question at hand involves complicated issues of administrative policy, practice and

procedure that ought best to be resolved by the agency. Borlem, 13 CIT at 237, 710 F. Supp. at

802. As the Supreme Court noted in Western Pacific:

[T]he first question presented is whether effectuation of the statutory purposes of the

Interstate Commerce Act requires that the Interstate Commerce Commission should first

pass on the construction of the tariff in dispute here; this, in turn, depends on whether the

question raises issues of transportation policy which ought to be considered by the

Commission in the interests of a uniform and expert administration of the regulatory

scheme laid down by the Act. 

352 U.S. at 65. 
Consol. Court No. 97-03-00483 Page 22

8

 Of course, reflecting the significant deference and flexibility given to Commerce in its

conduct of antidumping investigations, this Court does not review Commerce's administrative

decisions de novo. Rather, 19 U.S.C. § 1516a(b)(1)(B) (1994) provides that the Court “shall

Applying these principles to the question at hand, the Court finds that it is Commerce,

and not this Court, which is in the best position to initially decide whether it should consider new

evidence concerning the comparability of 2-ethylhexanol and octanol-2. It is a well-established

principle of administrative law that an agency is afforded broad discretion to fashion its own

administrative procedure, including the authority to establish and enforce time limits concerning

the submission of written information and data. Vermont Yankee Nuclear Power Corp. v.

Natural Resources Defense Council, Inc., 435 U.S. 519, 544-45 (1978). In accord with this

authority, Commerce has promulgated regulations which set forth time limits governing the

submission of factual information in antidumping investigations. For time limits generally, 19

CFR. § 353.31(a) (1997) requires that "submissions of factual information for the Secretary's

consideration shall be submitted not later than . . . seven days before the scheduled date on which

the verification is to commence." In addition, 19 CFR § 353.31(a)(2) (1997) allows any

interested party to "submit factual information to rebut, clarify, or correct factual information

submitted by an interested party . . . at any time prior to the deadline provided in this section for

submissions of such factual information or, if later, 10 days after the date such factual

information is served on the interested party . . . ." 

The regulations further provide an exception to these time limits, however, for instances

where the Secretary requests or solicits factual information. 19 CFR § 353.31(b) (1997) states, in

part, that:

(1) Notwithstanding paragraph (a) of this section, the Secretary may request any

person to submit factual information at any time during a proceeding.

(2) In the Secretary's written request to an interested party for a response to a

questionnaire or for other factual information, the Secretary will specify the time

limit for response. 

In applying these regulations to the investigations before it, Commerce regularly balances

its interest in conducting an efficient, uniform and expeditious administrative investigation

against its equally compelling interest in conducting accurate factfinding. Such a weighing of

competing interests involves choices of administrative practice and procedure which Commerce,

in its specialized role as administrator of antidumping investigations, is uniquely qualified to

make.8

 For this reason, the Court finds the question of whether to accept new evidence
Consol. Court No. 97-03-00483 Page 23

hold unlawful any determination, finding, or conclusion found . . . to be unsupported by

substantial evidence on the record, or otherwise not in accordance with law.” 

9

 It should be noted that, by invoking the doctrine of primary jurisdiction, the Court is not

abdicating its jurisdiction over these questions. Rather, "[u]pon completion of the remand

proceedings, this Court will review all the [agency's] actions to determine if they are based upon

substantial evidence and are in accordance with law." Borlem, 13 CIT at 237, 710 F. Supp. at

802.

concerning the comparability of 2-ethylhexanol and octanol-2 to be an issue relating to the

administration of antidumping investigations which, in the interest of a uniform and expert

administration of such investigations, ought to be considered by Commerce in the first instance. 

Accordingly, upon remand, Commerce is instructed to consider, and express its views on,

whether it should accept new evidence concerning the comparability of 2-ethylhexanol and

octanol-2. Should Commerce come to the conclusion that it should accept such evidence,

Commerce may do so on remand and, if appropriate, use this evidence as a basis for justifying its

use of the Chemical Weekly (India) value for "octanol." In so doing, Commerce may, but need

not, limit its search for information to that submitted during the Third Administrative Review. 

Similarly, Commerce, in its discretion, may also seek or request further information (in addition

to the letter from the editor of the Chemical Weekly (India) submitted for the Third

Administrative Review) concerning the true nature of the "octanol" quote from the Chemical

Weekly (India).9 

IV

CONCLUSION

For the foregoing reasons, the Court grants Defendant-Intervenors' Motion For

Reconsideration. Accordingly, the Court further remands this case to Commerce with

instructions that Commerce: 

1. value the octanol-2 that results from the sebacic acid production process based on

an appropriate surrogate value for this product, and then recalculate the byproduct/co-product determination in light of this surrogate value. This surrogate

value may be an appropriate foreign or U.S. price or cost for comparable

merchandise. In seeking the best available information to use as a surrogate,

Commerce is to specifically consider and address all alternative surrogate values

that have been placed on the record by the parties;
Consol. Court No. 97-03-00483 Page 24

2. open the administrative record and consider the letter from the editor of the

Chemical Weekly (India). Unless Commerce is able to identify substantial record

evidence on remand which demonstrates that, notwithstanding the letter from the

editor of the Chemical Weekly (India), the "octanol" quote from the Chemical

Weekly (India) is actually a quote for octanol-1, Commerce may not continue to

argue for the use of this figure on the grounds that octanol-1 and octanol-2 are

"comparable merchandise;" and 

3. consider, and express its views on, whether it should accept new evidence

concerning the comparability of 2-ethylhexanol and octanol-2. Should Commerce

come to the conclusion that it should accept such evidence, Commerce may do so

on remand and, if appropriate, use this evidence as a basis for justifying its use of

the Chemical Weekly (India) value for "octanol."

In addition, the Court observes that nothing in its Remand Memorandum or Remand

Order of March 27, 1998, should be interpreted as either requiring or prohibiting the use of an

unadjusted, refined value as a surrogate for octanol-2. Rather, if, upon remand, Commerce

continues to adhere to its position that an unadjusted, refined value is the best available

information to use as a surrogate, the Court will uphold this determination so long as its choice

of a surrogate is supported by substantial evidence on the record and is otherwise in accordance

with law. This will be true regardless of whether the octanol-2 produced by DefendantIntervenors is characterized as "crude" or "refined" in nature.

As a final note, the Court wishes to express its concern with the manner in which the

Department of Commerce conducted the Remand Determination. As discussed above, the Court

erred in its Remand Order of March 27, 1998, in stating that Commerce was to "value octanol-2

based on an appropriate cost." While not technically incorrect, the Court's failure to say "cost or

price," or use the more generic term "value," could, if read in isolation, be interpreted as limiting

Commerce to consider only record evidence of "costs" upon remand. To arrive at such a narrow

result, however, Commerce would have had to ignore the obvious implications of the Court's

findings in the Remand Memorandum, and it would have had to interpret the Court's Remand

Order as directly conflicting with its statutory obligations. That is exactly what Commerce did. 

See infra, Section III (B)(2).

In so interpreting the Court's Remand Order, Commerce displayed what can best be

described as a lack of common sense. While Commerce certainly should pay great attention to

the particular language used in a court order, it is not to interpret the Court's language in a
Consol. Court No. 97-03-00483 Page 25

vacuum. Rather, if a slip opinion has been issued along with an order or judgment, Commerce

should use that document in resolving any questions that may arise. Similarly, Commerce

should avoid interpreting a court order in a way that creates a conflict with the discretion

conveyed to it by statute. A proper role of courts is to clarify the scope or meaning of any order

they issue, upon appropriate request. Had Commerce here sought such a clarification before

issuing its Remand Determination, much of the time and cost associated with the current

litigation, as well as the further remand, could have been avoided. All attorneys, especially those

employed by the government, are obliged to their clients, the judicial system, and society in

general, to maximize scarce resources and minimize waste. This Court should not have to again

remind Commerce and its attorneys of that obligation. 

__________________________

 Evan J. Wallach, Judge

Date: April 29, 1999

New York, New York