Slip Op. 24- 66

UNITED STATES COURT OF INTERN ATIONAL TRADE

Court No. 22-00152

COALITION OF AMERICAN MANUFACTURERS OF MOBILE ACCESS EQUIPMENT,
Plaintiff

,

v. UNITED STATES,
Defendant

, and
ZHEJIANG DINGLI MACHINERY CO., LTD.,
Defendant-Intervenor.

Before: M. Miller Baker, Judge

OPINION

[The court sustains in part the agency’s final determination and remands in part for further proceedings.]

Dated: May 31, 2024

Timothy C. Brightbill and Laura El-Sabaawi

, Wiley Rein LLP, Washington, DC, on the papers for Plaintiff.

Brian M. Boynton , Principal Deputy Assistant Attorney General; Patricia M. McCarthy , Director; Tara K. Hogan , Assistant Director; and Kristin E. Olson , Trial Attorney, Commercial Li tigation Branch, CivilCt. No. 22-00152 Page 2

Division, U.S. Department of Justice, Washington, DC, on the papers for Defe ndant. Of counsel for Defendant was Brishailah Brown , Attorney, O ffice of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Co mmerce, Washington, DC.

Ned H. Marshak

, Dharmendra N. Choudhary , and Jordan C. Kahn

, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, Ne w York, NY, and Washington, DC, on the papers for Defendant-Intervenor.

Baker , Judge: In this case, domestic manufacturers challenge the Department ofCommerce’s final determination following an antidu mping investigation into “mobile access equipment”—p eripatetic lifting machines such as one might se e used in large home improvement stores or factor ies—imported from China. For reasons explained below, the court sustains theagency’s determination in part and remands for reconsideration of certain issues.

I

At the request of the Co alition of American Manufacturers of Mobile Access Equipment, Appx1176, Commerce opened an anti dumping investigation covering the second half of 2 020. 86 Fed. Reg. 15,922; Appx6778–6784. The Depart ment selected as mandatory respondents the two la rgest Chinese exporters or producers during the period of investigation, Lingong Group Jinan Heavy Machiner y Co., Ltd. (Jinan), andCt. No. 22-00152 Page 3

Zhejiang Dingli Machiner y Co., Ltd. (Dingli). Appx1001–1002.

Commerce found that dumping was occurring. Appx1035. After the Intern ational Trade Commission determined that these impo rts injure do mestic industry, the former issued an antidumping order. 87 Fed. Reg. 22,190, 22,190.

II

Invoking jurisdiction co nferred by 28 U.S.C. § 1581(c), the Coalition sued under 19 U.S.C. §§ 1516a(a)(2)(A)(i)(II) and (a)(2)(B)(i) to challenge Commerce’s final determination. See ECF 8. After Dingli intervened on the si de of the government, ECF 16, the Coalition moved for judgment on the agency record. ECF 55. The govern ment (ECF 59) and the company (ECF 53) opposed. The Coalition replied. ECF 57. The court decides th e motion on the papers.

In § 1516a(a)(2) actions, “[ t]he court shall hold unlawful any determination, fi nding, or conclusion found . . . to be unsupported by substantial evid ence on the record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i). That is, the question is not whether the court would have reached the same conclusion on th e same record—rather, it is whether the administrative record as a whole permits Commerce’s conclusion.Ct. No. 22-00152 Page 4

Substantial evidence has been defined as more than a mere scintilla, as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. To determine if substantial evidence exists, we review the record as a whole, including evidence that supports as wellas evidence that fairly detracts from the substantiality of the evidence.

Nippon Steel Corp. v. United States , 337 F.3d 1373, 1379 (Fed. Cir. 2003) (cleaned up); see also SSIH Equip. S.A. v. U.S. Int’l Trade Comm’n , 718 F.2d 365, 382 (Fed. Cir. 1983) (if Co mmerce makes a choice between “two fairly conflicting views,” the court may not substitute its judgment even if its view would have been different “had the matter been before it de novo ”) (quoting Universal Camera Corp. v. NLRB , 340 U.S. 474, 488 (1951)).

III

A

The Coalition challenges the Department’s surrogate value selections for Di ngli’s ocean-shipping costs, steel inputs, and drive motor inputs. 1 The court considers each in turn.

1 Because China has a nonmarket economy, in antidumping cases Commerce calculates the costs of producing goods in that country and shipping them to the United StatesCt. No. 22-00152 Page 5

1

Commerce requested fact s and figures to value Dingli’s cost of shipping carg o by sea from China to the United States. The company submitted data from Descartes, Freightos, and Drewry, Appx6908–6913, Appx7402–7465, while the Coalition provided information from Maersk, Appx 3718–3732. The Department observed that in weig hing this evidence, its policy is to select values that are “ publicly available , product-specific, representative of a broad market average, . . . and contemporaneous wi th the [period of investigation] under consideration. ” Appx1042 (emphasis inoriginal). Weighing those factors, it selected the Descartes, Freightos, and Dr ewry material. Appx1042–
1047.

Commerce provided several reasons for this choice. Most importantly, the Coa lition designated its Maersk data as business propriet ary information (BPI), Appx1043, but Dingli placed information from three sources on the public record, Appx1042–1043. 2

using analogous market-economy costs. See Hung Vuong Corp. v. United States , 483 F. Supp. 3d 1321, 1339 (CIT 2020) (describing this process).

2 In response to the Coalition’s claim that it was forced to designate its Maersk data as proprietary because Dinglihad so designated its shipping routes, the Department explained that it wasn’t clear wh y the former “treated the entirety of the Maersk ocean freight data as BPI rather than simply [so] treating the shipping routes.” Appx1043. HadCt. No. 22-00152 Page 6

Moreover, the Coalition’s Ma ersk data were based on “price quotes . . ., which ar e not data [the Department] prefers to use.” Appx1044. In contrast, “the Descartesdata for ocean freight charges represent actual, consummated transactions.” Id . Further, and again unlike the Descartes, Freightos, and Drewry price quotes, the Maersk data were not “[p]ublicly available, published prices,” Appx10 43–1044, meaning they could not be obtained except through a private inquiry.

Addressing the Coalition’ s contention that the Maersk data were mo re specific, i.e., they more closely resembled Dingli’s ocean fr eight costs, the Department opined that the Descartes, Drewry, and Freightos information reflec ted routes used by both Dingli and Jinan, Appx1043, and that freight carried by both Maersk and Descartes covered “a broad class of merchandise that do[es] not specifically pertain to mobile access equipment or subassemblies thereof.” Appx1044. Although the Dr ewry and Freightos data did “not specify the precise types of commodities being shipped,” id ., their rates appeared to be “representative of, and equall y applicable to, all types of merchandise,” id

.

the Coalition only treated the routes “as BPI, the ocean freight rates could have been considered because there is no presumption that the shipping routes referenced in Maersk’s ocean freight rates are necessarily identical to those used by respondents.” Id

.Ct. No. 22-00152 Page 7

The Coalition attacks thes e findings on several grounds:

The Agency Preference for Public Data

The Coalition argues that the Department improperly accepted Dingli’s designation of its ocean freight routes as proprietary. ECF 55, at 27. According to the Coalition, this forced it to similarly denominate its Maersk shipping data to avoid breaching the agency’s protective order. Id . at 27–28.

The government does not defend Commerce’s acceptance of Dingli’s BPI de signation of ocean freight routes, instead arguing that regardless of whether the company erred in so doing, the agency prefers using public rather than confidential data. See ECF 59, at 20. For its part, the comp any does not justify characterizing its sea lanes as proprietary. Rather, it contends—echoing the Depar tment’s reasoning, see above note 2—that the Coalition on ly has itself to blame for erroneously denominating the Maersk shipping rates as BPI when Dingli only so labeled its routes . ECF 53,
at 5.

As neither the government nor Dingli defends the latter’s BPI designation of its routes, the court remands for the agency to ex plain why such characterization was permissib le under 19 C.F.R. § 351.105(c). Insofar as the Department finds that the company erred, the former must dire ct the latter to withdrawCt. No. 22-00152 Page 8

its designation. See 19 U.S.C. § 1677f(b)(2). 3 If Dingli declines, then the agency must return the submission and allow the company to proffer “other material.” Id

. On the other hand, if the Department finds that Dingli properly designated i ts shipping routes as proprietary, Commerce must th en advise the Coalition that its corresponding designa tion of “ocean freightrates” was—as explained in the agency’s final determination—improper and ask for an “explanation.” Id

. If the agency is unpersuaded , it must allow the Coalition to withdraw the designation. See id . What the agency cannot do under § 1677f(b)(2) is what it did here— accept an interested part y’s BPI designation, only later characterize that denomination as erroneous, and then cite that error as a reason not to use theinformation because of the agency’s preference for using publicly av ailable data. 4 Commerce ha s a statutory

3 The agency must also provide a corresponding opportunity for the Coalition to do the same as to the Maersk data.

4 The Coalition does not contest Commerce’s “view” that the agency “preference for publicly available information [is] one that requires info rmation to be placed on the public record .” Jinko Solar Imp. & Exp. Co. v. United States , Consol. Ct. No. 22-00219, Slip Op. 24-53, at 34–35, 2024 WL 2078453, at *13 (CIT May 1, 2024) (emphasis added). Far from it—as explained below in connection with certain BPI rebuttal material submitted by Dingli, the Coalition seeks
to enforce that preference. Cf. id . at 36–37, 2024 WL 2078453, at *14 (remanding for the agency to “consider orCt. No. 22-00152 Page 9

duty to allow an interested party to cure unwarranted BPI designations. See 19 U.S.C. § 1677b(f)(2).

Price Quotes Versus Cons ummated Transactions

The Coalition argues that Commerce cited no evidence to support its findin g that Dingli’s Descartes data reflect consummated transactions, unlike the Maersk price quotes. See ECF 55, at 33–34. But Dingli

explain how publicly available information on the confidential record fails to promote accuracy, fairness, and predictability”). The court observes that it appears the agency’s preference for non-BPI data is based on the interplay between three regulations. One authorizes in terested parties to submit “factual information”—defined by another as “[p]ublicly available information,” 19 C. F.R. § 351.102(b)(21)(iii)—“tovalue factors of production under § 351.408(c),” i.e., in nonmarket-economy country cases, id. § 351.301(c)(3)(i). A third, in turn, explains that “[t]here are four categories ofinformation in an antidumping or countervailing duty proceeding,” id. § 351.105(a), two of wh ich are “public” and “[BPI],” id . The former “is information that may be madeavailable to the public, whereas [the latter] may be disclosed (if at all) only to authorized applicants under an [administrative protective order].” Id . Putting all this together, the Department requires interested parties to submit non-BPI data to value the factors of production in nonmarket-economy cases. The court reserves for another day whether that requirement conflicts with the statute, which directs—subject to an exception not relevant here—that in such cases the Department’s valuation of those factors “shall be based on the best available information . . . .” 19 U.S.C. § 1677b(c)(1) (emphasis added).Ct. No. 22-00152 Page 10

points to a certain code (the “Transshipment Local Instructions”) which it assert s “establishes that all Descartes price data represent actual transactions on those dates.” ECF 53, at 8. The Coalition’s failure to confront this point on reply leads the court to infer that substantial eviden ce supports the Department’s finding, even if the agency di d not cite that evidence.

Are the Maersk Data Public?

The Coalition objects to Commerce’s characterization of the Maersk informat ion as not “[p]ublicly available, published prices.” ECF 55, at 29–30 (quoting Appx1044). Neither the go vernment nor Dingli seriously disputes this point, with the latter reduced to complaining that the Coalit ion failed “to establish how Maersk data can be publicly accessed.” ECF 53, at 5– 6. On reply, however, the Co alition observes that the Department “has acknowledged the public nature of the Maersk data many time s” and cites two such examples. See ECF 57, at 6–7. 5 In view of Commerce’s past pronouncements bearing directly on the question, the court remands so the agen cy can reconcile its finding with those previous determinations.

5 Consistent with Commerce’s previous acknowledgements, the court observes that the Maersk website provides shipping price quotes to the public. See https://www.maersk.com/onlinequote/standard.Ct. No. 22-00152 Page 11

Specificity

The Coalition argues its Maersk data were more reflective of Dingli’s ocean freight costs than the Descartes, Freightos, and Drewry information used by Commerce. According to the Co alition, the former data were limited to the sea rout e (to the U.S. West Coast)Dingli used for the overwhelming majority of its exports, see ECF 54, at 24, but the latter included routes for both the U.S. East and West Coasts, see ECF 55,
at 24–25.

Commerce explained that the Descartes, Freightos, and Drewry data replicated not only Dingli’s routes, but Jinan’s as well, Appx 1043—a non sequitur, because the Department was calculating just the former’s ocean shipping costs. The government repeats that error, ECF 59, at 24, and further observes that Dingli shipped to both coasts, id . at 22–23, but does not acknowledge that the company’s exports to the East Coast were de minimis. Dingli, to its credit, acknowledges that fact, see ECF 53, at 3–4, but argues that there is no administra tive or judicial precedent requiring the agency to we igh the “number of shipments for each port combination used,” id

. The lack of precedent, however, is not dispositive because the relevant questi on is whether Commerce’s specificity determination is reasonable. And “what is reasonable depends on the context.” United States v. R. Enters., Inc. , 498 U.S. 292, 299 (1991) (quoting New Jersey v. T.L.O. , 469 U.S. 325, 337 (1985)). Dingli shipsCt. No. 22-00152 Page 12

almost all its lifting machines by sea to the U.S. West Coast, with only a small frac tion going to the Port of New York. 6 Elementary geography dictates that, all other things being equal, it’s cheaper to transport cargo by sea from China to the former rather than the latter. 7 At least as to Dingli’s ocean shipping routes, the Department’s failure to recognize that the Descartes, Freightos, and Drew ry data are less specific than the Maersk inform ation is unreasonable.

The Coalition’s second sp ecificity challenge is to Commerce’s finding that the Descartes, Freightos, and Drewry rates were for cargo essentiall y comparable to the goods used for the Maer sk price quotes. The Coalition argues that the Depart ment’s decision is unreasonable because its Maersk data involved machinery parts, see ECF 54, at 25, that more closely resembled Dingli’s lifting equipment th an the array of both mechanical parts and non-mach inery goods reflected in

6 Notwithstanding that Dingli’s shipping routes are purportedly BPI, its public brief discloses that the company “actually used the Shanghai–New York route.” See ECF 53, at 3.

7 For example, it’s 5398 nautical miles from Shanghai to San Francisco, to take one We st Coast port. A vessel steaming at 10 knots would take 22 days to transit that distance. From Shanghai to New York at the same speed would take 44 days via the Panama Canal (10,582 nautical miles), 51 days via the Suez Canal (12,370 nautical miles), 60 days via the Cape of Good Hope (14,468 nautical miles), and 69 days via the Strait of Magellan (16,684 nautical miles). See https://Sea-Distances.org.Ct. No. 22-00152 Page 13

the Descartes data, including furniture, plastic bags, fabric, paper cups, and sofa covers, see ECF 55, at 25.

The court disagrees. Comm erce weighed this evidence and explained that ne ither the Coalition’s data nor Dingli’s “specifically pe rtain[ed] to mobile access equipment or subassemblies thereof.” Appx 1043. Both covered a “broad class of merchandise” that included various mechanical parts. Id . That Dingli’s data included non-mechanical prod ucts had to be weighed against the fact that neither data set replicated the mobile access equipment. Unlike the Department’streatment of shipping routes, there’s nothing unreasonable in how the agency weighed the competing considerations as to cargo specificity.

* * *

Commerce’s choice of data to value Dingli’s ocean freight costs is a mixed bag. Certain aspects of that decision are supported by subs tantial evidence, but others are not. It’s not clea r the agency would have reached the same result had it properly analyzed the record, so the court rema nds for reconsideration.

Adjustments to Descartes Data (If Selected Again)

Finally, Commerce reject ed the Coalition’s assertion that “Dingli improperly excluded certain charges in its reported De scartes freight dat a when shipping goods to the United States .” Appx1046. The Department found that the Desc artes rates “are clearlyCt. No. 22-00152 Page 14

identified as only ocean fr eight charges,” which “indicates that the ra tes do not cover non-ocean freight charges, such as brokerage and handling fees, U.S. inland freight charges ( i.e. , destination delivery charges)[,] or truck-freight services.” Appx1046–1047. It added that those sorts of costs “are included in the brokerage and handling [surrogate value]” based on World Bank data. Appx1047.

The Coalition now raises a contingent argument that, if Commerce justifi ably selected Dingli’s proffered shipping data, the Depa rtment needed to “adjust it” by adding certain fees to the rate so that it would more closely match the comp any’s “experience” during the period of investigation. ECF 55, at 34. The Coalition asserts that Dingli omi tted certain charges that a customer would have to pay when using Descartes to transport goods by sea—in cluding a “bunker adjustment factor,” a “destination delivery charge,” and local port fees—and contends th at those charges should have been part of the freight rates. Id. at 34–35. It also argues that the “other excl uded charges . . . ‘are all part of the price that a cu stomer would have to pay and are separate from brok erage and handling expenses.’ ” Id. at 35 (quoting Appx6534). Lastly, it maintains that Commerce’s find ing that the World Bankdata included these amounts in brokerage and handling expenses “does not appe ar to be true” because the “brokerage and handling” in formation the Department used had a narrow scope. Id. at 36–37 (citing Appx7143–7266, Appx 6777(e)–6777(f)).Ct. No. 22-00152 Page 15

Neither the agency discu ssion nor the parties’ arguments allow the court to resolve this issue. Insofar as the court can discern fr om the pages cited by Commerce and the parties in thei r briefing, it’s impossible to tell what the “brokerage and handling” fees included or excluded. The Department cited its surrogate value memorandum pre pared before the preliminary determination. See Appx1047 (citing Appx21434–21446). The text of that memorandum contains no explan ation of this issue, and the attachment simply contains three different line items for “brokerage & handling” wi th no detail about what those amounts represent, al though it does break out “truck freight” separately from “ocean freight.” Appx21446(e)–21446(f). The Coalition notes that the page in the record showin g what the “brokerage andhandling” fees include mentions only two components—“border compliance” and “documentary compliance.” ECF 55, at 37 (citing, inter alia , Appx7146). The government essentially just repeats the ag ency conclusion that the “brokerage and handling” value includes the charges, see ECF 59, at 27–28 (citing Appx1047, Appx21438), and says the data “satisfied Commerce’s surrogate value criteria,” id. at 28–29. Dingli contends the Coalition did not show how the various charges are

not part of “brokera ge and handling.” See ECF 53,
at 8–9.

The problem the court has, for purposes of substantial evidence review, is that the Department’s decision appears to assume what the brokerage and handlingCt. No. 22-00152 Page 16

surrogate value includes. 8 The court has “no basis for thinking that [the assump tion] is a matter of common knowledge or otherwise can be presumed true without evidence.” CS Wind Vietnam Co. v. United States , 832 F.3d 1367, 1374 (Fed. Cir. 2016); OCP S.A. v. United States , 658 F. Supp. 3d 1297, 1324 (CIT 2023) (noting that agency discretion “doe s not include the ability to assume facts for which there is insufficien t evidence”); cf. DyStar Textilfarben GmbH & Co. Deutschland KG v. C.H. Patrick Co. , 464 F.3d 1356, 1367 (Fed. Cir. 2006) (“[A]ssumptions abou t common sense cannot substitute for evidence thereof . . . .”) (emphasis in original). The court therefore remands so the agency—insofar as it once again choo ses to use the Descartes information—can point to the specific data in the record on which it relies to suppor t its conclusion about what costs the brokerage and hand ling surrogate value includes.

2

The Coalition challenges Commerce’s use of certain Harmonized Tariff Schedu le (HTS) subheadings to value “minor fabricated steel components.” 9 It argues

8 The court has no difficulty accepting the agency’s conclusion about inland freight charges and truck freight because, as noted above, the cited pages break those out separately from ocean freight.

9 As used by the Department an d the parties, this term refers to 18 various inputs. See Appx1071; ECF 55, at 39 &Ct. No. 22-00152 Page 17

that these subheadings “relat e to raw steel inputs (in other words, plain steel) ra ther than manufactured products and thus did not ac curately reflect the substantial further processing that Dingli’s steel components had undergone,” such that the Department undervalued the inputs and understated the company’s dumping margin. ECF 55, at 39–40.

Commerce described the Coal ition’s theory as being that Dingli’s inputs are “fabricated steel components that the company’s supplier s have already fabricated into components for incorpor ation into finished mobile access equipment goods.” Appx1070. The Coalition contended that the approp riate HTS subheading for such components was therefore 7326.90.90. Appx1070–1071. Dingli resp onded that it purchased “minimally processed steel plates/sheet” from its suppliers such that the “essent ial nature” did not changefrom the primary steel material. Appx1071. The Department agreed with the company and said the Coalition “did not provide any ev idence to support its allegation” that the former misrepresented the degree ofprocessing its suppliers performed, while Dingli produced letters from various suppliers describing production of the components. Appx1072.

The Coalition now argues that Commerce erred by treating “numerous manufac tured parts and [mobile

n.5; ECF 59, at 29 & n.3 (citin g Appx21446 for a full list of what the 18 inputs are).Ct. No. 22-00152 Page 18

access equipment] components as plain steel.” ECF 55, at 40. It asserts that the ev idence shows that Dingli’s suppliers sold compon ents, not plain steel, id. at 40– 41, and that the Department erred by valuing all the inputs using HTS subheading s for plain steel fresh from a mill, id. at 43–44. It also emphasizes that the agency contradicted itself by acknowledging record evidence that Dingli’s supplie rs “may do minimal work on a particular part . . . or in some cases, they may do more in-depth fabric ation or processing,” id. at 45 (quoting Appx1072), but still concluding that HTS subheadings for raw steel that state that the steel must be “not further worked” are somehow appropriate, id. (citing Appx1070).

Rather than respond to th e Coalition’s arguments, the government asserts that Commerce’s conclusion was reasonable because it considered and accepted Dingli’s explanation. ECF 59, at 29. Acknowledging that “in certain instances, [Dingli’s suppliers] may do some minimal work on cert ain fabricated steel components,” id. at 30 (citing Appx3289–3321), 10 the government argues that these lette rs are “part of the information that Commerce cons idered” and, apparently, contends that fact makes the Department’s conclusion

10 See also id . (quoting a supplier letter stating, “We cut the plates using a laser cutting machine to specific shapes and sizes. We also bend some plates to specific angles using abending machine to meet the drawing specifications. As required, holes are drilled into se veral pieces of steel plates.”) (quoting Appx1072, Appx3416).Ct. No. 22-00152 Page 19

reasonable, id. at 30–31 (citing Appx1071), although it offers nothing to support that implicit conclusion.

For its part, Dingli echoes Commerce’s conclusion that the Coalition failed to provide an y evidence. ECF 53, at 21 (quoting Appx1072). But the company block-quotes the following sentence (among others) from the final determination:

Although the letters from certain suppliers provided on the record indicate a wide range of fabrication that may be involved , depending on the input and specification re quirements, record evidence demonstrates that Dingli’s suppliers may do minimal work on a pa rticular part, such as cutting, bending, or punching holes[,] or in some cases, they may do more in -depth fabrication or processing

. ECF 53, at 21 (quoting Ap px1072) (emphasis added). With agency findings like that, the Coalition didn’t need any evidence.

Commerce’s determinatio n is internally inconsistent. While it said the Co alition failed to substantiate its allegation that Ding li’s suppliers provide fabricated components rather th an plate steel, it turned around and acknowledged the company’s evidence that some suppliers “do more in-depth fabrication or processing.” Appx1072. Th ese contradictions mean that the Department failed to support its conclusionCt. No. 22-00152 Page 20

with substantial evidence, so the court remands for reconsideration.

3

Two of Dingli’s inputs ar e devices called “Drive Motor 1” and “Drive Motor 2. ” Before Comm erce, the company offered evidence that because the latter acts solely as a motor, while the former does that and also functions as a generator via regenerative breaking, the two devices are not interch angeable. Appx1099. The Department accepted that characterization and used different HTS subheadings to value each input. See Appx1102 (“[B]ecause HTS subheading 8501.32 encompasses both of the appl icable HTS eight-digit subheadings (8501.32.10—electric motor and 8501.32.20—generator), . . . HTS subheading 8501.32 is the most representative an d accurate [average unit value] for this input.”).

The Coalition asserts that Commerce’s valuation is not supported by substantia l evidence, and is contrary to law, because it overlook ed that Drive Motor 1’s primary function is as a motor. ECF 55, at 49 (citing Appx6571). The Coalition con siders that fact essential because, when classifying “items that are composite items or have more than one function, the primary function of the items is th e controlling function in terms of tariff classification.” Id. at 50.

Although both the Coalit ion and the government assert various arguments based on tariff classificationCt. No. 22-00152 Page 21

principles and the General Rules of Interpretation, 11 they overlook the essentia l point—persuasively made by Dingli, see ECF 53, at 18–19—that this is an antidumping case, “ not a customs classification case.” Downhole Pipe & Equip., L.P. v. United States , 776F.3d 1369, 1379 (Fed. Cir. 2015) (emphasis in original). Consequently, rather than “engage in a classification analysis to determ ine which [HTS] subheading contained [the relevant input],” id ., Commerce “was required to determine wh ich of the competing subheadings constituted the be st available information for valuing [that] input,” id . In classification cases, Customs and Border Protection ’s role is to determine how to classify merchandise for tariff purposes, while in antidumping cases the De partment’s job is to determine the duty needed to re medy the effects of lessthan-fair-value sales of fo reign merchandise in the United States. SolarWorld Americas, Inc. v. United States , 910 F.3d 1216, 1224 (Fed. Cir. 2018).

To be sure, the Coalit ion—while not addressing Dingli’s citation of SolarWorld —claims that its point is not that the Department and Customs are “bound by the same objectives.” EC F 57, at 29. Rather, it argues, “the primary function of Dingli’s merchandise

11 “The proper classification of merchandise entering theUnited States is directed by the General Rules of Interpretation . . . of the [Harmonized Tariff Schedule of the UnitedStates] and the Additional United States Rules of Interpretation.” Orlando Food Corp. v. United States , 140 F.3d 1437, 1439 (Fed. Cir. 1998).Ct. No. 22-00152 Page 22

was a valid and important co nsideration regarding the appropriate [surrogate valu e] selection. Commerce was required to address this argument, and it failed to do so.” Id. at 29–30. The court di sagrees given the Federal Circuit’s clear holding that the Department need not follow classification principles.

The agency explained that the record shows that Drive Motors 1 and 2 are di fferent devices with different functionality—a point no party disputes—and concluded that (1) it is therefore appropriate to use different HTS subheadings to va lue them and (2) 8501.32 encompasses subheadings cove ring both (undisputed) functions. Appx1102. The Coa lition in effect asks the court to reweigh findings. “T his court’s duty,” however, “is not to evaluate whethe r the information Commerce used was the best available, but rather whether a reasonable mind could conclude that [it] chose the best available information.” Downhole Pipe , 776 F.3d at 1379 (cleaned up). Here, a reasonable mind could so conclude that the Department chose the best available information.

B

Commerce’s regulations go vern when interested parties may submit certai n “factual information” 12 during an administrative proceeding. See 19 C.F.R.

12 The applicable definition of “factual information” varies with the relevant context. See 19 C.F.R. § 351.102(b)(21)(i)–(v).Ct. No. 22-00152 Page 23

§ 351.301. The Coa lition challenges the Department’s acceptance of certain such information from Dingli. 13

1

In an antidumping invest igation, an interested party may submit “factual in formation to value factors of production under § 351.408(c).” 14 19 C.F.R. § 351.301(c)(3)(i); see also id. § 351.102(b)(21)(iii) (defining “factual information” as including “[p]ublicly available information submitted to value factors [of production] under § 351.408( c)”). Other interested parties in turn may tender “p ublicly available information to rebut, clarify, or corre ct such factual information submitted pursuant to § 351.408(c).” Id . § 351.301(c)(3)(iv) (emphasis added); see also above note 4 (explaining the regula tory basis for Commerce’s preference for using non-BPI information to value the factors of production in nonmarket-economy cases).

Dingli submitted BPI m ill test certificates(Appx3827–3933) to rebut data submitted by the Coalition to value certain factors of production. Over the

13 The Coalition’s opening brief identifies the universe of Dingli’s factual submissions ostensibly at issue, see ECF 55, at 53 n.10, but then on ly addresses certain of those submissions in its ensuing discussion. The court finds theCoalition’s argument waived as to submissions not so addressed.

14 Section 351.408(c) in turn a ddresses valuation of factors of production for use in calculating normal value of imports from nonmarket-economy countries.Ct. No. 22-00152 Page 24

latter’s objection that to do so violated § 351.301(c)(3)(iv), Comm erce accepted the submission, reasoning that it was the only means available to the company to “rebut, clarify, or correct the [surrogate value] information on the record.” Appx1058. Moreover, its “purpose” wa s “to support information . . . already on the record.” Id . The Department added that the material did not prejudice the Coalition. Appx1058–1059. Not only wa s the latter able to use it, Appx1058, it did not “provide any pre-verification comments” objecting to the submission, Appx1059.

The Coalition argues that neither reason offered by the Department for acceptin g Dingli’s non-public rebuttal information excuses disregarding the regulation’s plain text. ECF 55, at 56–57. As to prejudice, it asserts that “there was no wa y for either the agency or [the Coalition] to corrobora te or impeach this information.” Id . at 56.

Although the government doesn’t dispute that Commerce’s acceptance of Di ngli’s BPI submission violated the Department’s regulation, it argues that the agency provided a reasonable justification for doing so.ECF 59, at 44–45. It also emphasizes Commerce’s finding that the Coalitio n was not prejudiced. Id . at 46.

For its part, Dingli asserts that the regulation does not expressly bar the submis sion of proprietary material, ECF 53, at 28, and that in any event the Coalition suffered no prejudice becaus e it challenged the company’s mill test certificates in subsequent briefing, id

.Ct. No. 22-00152 Page 25

at 27. Dingli emphasizes—e choing the Department’s finding—that by neglecting to provide pre-verification comments, the Coalition “for ewent an opportunity to have Commerce assess any concerns” regarding the company’s BPI certificates. Id. at 27–28.

As the government implic itly concedes, Commerce plainly violated § 351.301(c)(3)(iv) by accepting Dingli’s non-public surroga te value re buttal information. 15 Even so, that’s not th e end of the inquiry. The “general principle” is “t hat ‘[i]t is always within the discretion of . . . an administrative agency to relax or modify its procedural rules adopted for the orderly transaction of business before it when in a given case the ends of justice require it.’ ” PAM S.p.A. v. United

15 The company’s contention that the Department permissibly accepted proprietary mate rial because the regulation does not expressly prohibit it is wrong. Under the familiar expressio unius canon, § 351.301(c)(3)(iv)’s authorizationfor an interested party to submit “publicly available information” for rebuttal purposes necessarily implies that other defined types of information, such as BPI, are excluded. See 19 C.F.R. § 351.105(a) (“ There are four categories of information in an antidumping or countervailing duty proceeding: public, business proprietary, privileged, and classified.”). As Scalia and Garner explain, “[w]e encounter” this canon “frequentl y in our daily lives. When a car dealer promises a low financing rate to ‘purchasers with good credit,’ it is enti rely clear that the rate is not available to purchasers with spotty credit.” Reading Law: The Interpretation of Legal Texts 107 (2012) (emphasis in original).Ct. No. 22-00152 Page 26

States , 463 F.3d 1345, 1348 (Fed. Cir. 2006) (brackets in original) (quoting Am. Farm Lines v. Black Ball Freight Serv. , 397 U.S. 532, 538–39 (1970)). If an agency articulates a reason able justification for departing from its regulation, such a departure “is only rescindable ‘upon a showing of substantial prejudice.’ ” Id . (quoting Am. Farm Lines , 397 U.S. at 539).

Commerce provided a reasonable explanation for accepting Dingli’s proprietary data here—it was the only means available to the company to “rebut, clarify, or correct the [surrogate val ue] information on the record,” Appx1058, and “the pu rpose” of the submission was “to support information . . . already on the record,” id

. 16 And although the Coalitio n claims that it sufferedprejudice because it could not corroborate Dingli’s information, the Department found that the former raised no such concern in its pre-verification comments. 17 Appx1059. Because this finding is not disputed, the court holds that the Coalition has not shown substantial prejudice from th e agency’s a cceptance of Dingli’s proprietary material.

16 Indeed, the Department was arguably required under 19 U.S.C. § 1677b(c)(1) to cons ider the company’s BPI rebuttal submission. See above note 4.

17 Presumably the Coalition could have requested thatCommerce test Dingli’s proprietary submission at verification.Ct. No. 22-00152 Page 27

2

Along with submitting cert ain BPI mill test certificates to rebut data submitte d by the Coalition as described above, the company also submitted new information on its drive motor and cast-iron billet inputs. Appx3934–4400. 18 The Coalition contends that all these submissions we re untimely—and thus should have been rejected by the agency—because they were responsive to Comme rce’s questionnaire. 19 ECF 55,
at 59–60.

The problem with this argument is that the Coalition does not dispute—apart from the BPI aspect discussed above—Commerce’s determination that Dingli properly and timely submitte d its data as to mill test certificates, drive motor inpu ts, and cast-iron billets as rebuttal information under § 351.301(c)(3)(iv) . Indeed, as detailed above, the Coalition argues—and the court agrees, as also ex plained above—that § 351.301(c)(3)(iv)’s prohibit ion on submitting proprietary material applies here.

18 The Coalition’s brief identifies the asserted untimely information about mill test certificates, drive motor inputs, and iron billet inputs as encompassing Appx3828–4400. ECF 55, at 59.

19 The 30-day deadline for Dingli to answer the questionnaire, see 19 C.F.R. § 351.301( c)(1)(i), had long since passedby the time the company submitted its surrogate value rebuttal containing the factual information in question.Ct. No. 22-00152 Page 28

The Coalition can’t have it both ways—either § 351.301(c)(3)(iv) applies (a s it contends for purposes of objecting to the portion ofDingli’s rebuttal presentation that was BPI), or it do esn’t. If the regulation applies, then it doesn’t ma tter whether the company’s timely submission was also responsive to Commerce’s questionnaire (and therefor e untimely for purposes of that document). The Coalitio n offers no reason why information responsive to a Commerce questionnaire is disqualified from presentation under § 351.301(c)(3)(iv). 20 The court accordingly concludes that the Department properly accepted Di ngli’s timely submission under that regula tion to rebut data submitted by the Coalition.

* * *

The court sustains in part Commerce’s decision and remands in part for furt her proceedings consistent with this opinion.

Dated: May 31, 2024 /s/ M. Miller Baker New York, NY M. Miller Baker, Judge

20 The court assumes, but does not decide, that Dingli’s rebuttal information was so responsive.