Court Opinion

ID: 4505718
Source: CourtListenerOpinion
Date Created: 2020-02-07 17:00:39.319639+00
Date Added: 2024-06-11T08:11:53.704198
License: Public Domain

Case: 19-1289    Document: 57     Page: 1   Filed: 02/07/2020

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

     HITACHI METALS, LTD., HITACHI METALS
                AMERICA LLC,
               Plaintiffs-Appellants

                DAIDO STEEL CO., LTD.,
                       Plaintiff

                             v.

   UNITED STATES, ARCELORMITTAL USA LLC,
            NUCOR CORPORATION,
              Defendants-Appellees
             ______________________

                        2019-1289
                  ______________________

    Appeal from the United States Court of International
 Trade in Nos. 1:17-cv-00140-MAB, 1:17-cv-00165-MAB,
 Judge Mark A. Barnett.
                ______________________

                Decided: February 7, 2020
                 ______________________

     DANIEL CANNISTRA, Crowell & Moring, LLP, Washing-
 ton, DC, argued for plaintiffs-appellants. Also represented
 by ROBERT L. LAFRANKIE, PIERCE LEE.

     BRIAN RUSSELL SOISET, Office of General Counsel,
 United States International Trade Commission, Washing-
 ton, DC, argued for defendant-appellee United States. Also
Case: 19-1289    Document: 57      Page: 2    Filed: 02/07/2020

 2                       HITACHI METALS, LTD. v. UNITED STATES

 represented by ANDREA C. CASSON, DOMINIC L. BIANCHI.

    BROOKE MICHELLE RINGEL, Kelley Drye & Warren,
 LLP, Washington, DC, argued for defendant-appellees
 Arcelormittal USA LLC, Nucor Corporation. Defendant-
 appellee Arcelormittal USA LLC also represented by
 KATHLEEN CANNON, ROBERT ALAN LUBERDA, PAUL C.
 ROSENTHAL.

     ALAN H. PRICE, Wiley Rein, LLP, Washington, DC, for
 defendant-appellee Nucor Corporation. Also represented
 by STEPHANIE MANAKER BELL, CHRISTOPHER B. WELD.
                 ______________________

     Before MOORE, REYNA, and STOLL, Circuit Judges.
 REYNA, Circuit Judge.
     In 2017, the U.S. International Trade Commission is-
 sued a final affirmative determination that a U.S. domestic
 industry was materially injured by virtue of imported steel
 goods sold at less than fair value. Hitachi appealed to the
 United States Court of International Trade, challenging
 the Commission’s “domestic like product” determination.
 The Court of International Trade affirmed the Commis-
 sion’s domestic like product determination. Hitachi ap-
 peals that judgment. Because we conclude that the
 Commission’s “domestic like product” determination is
 supported by substantial evidence and otherwise not con-
 trary to law, we affirm.
                         BACKGROUND
     This case arises from an antidumping duty investiga-
 tion on imports of carbon and alloy steel cut-to-length plate
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 HITACHI METALS, LTD. v. UNITED STATES                       3

 (“CTL plate”). 1 On April 8, 2016, three domestic producers
 of CTL plate (“petitioners”) filed petitions with the U.S. De-
 partment of Commerce (“Commerce”) and the U.S. Inter-
 national Trade Commission (“Commission”), alleging that
 imports of CTL plate from twelve countries, including Ja-
 pan, were sold in the United States at less than fair value,
 and that an industry in the United States was materially
 injured as a result. Carbon and Alloy Steel Cut-to-Length
 Plate, 81 Fed. Reg. 22116 (April 14, 2016) (Institution De-
 cision). Both the Commission and Commerce initiated an-
 tidumping duty investigations. Id. Hitachi Metals, Ltd.,
 and Hitachi Metals America, LLC (“Hitachi”) joined the
 Commission investigation, identifying itself as “a Japanese
 producer . . . and U.S. importer of carbon and alloy steel
 cut-to-length plate.” Carbon and Alloy Steel Cut-to-Length
 Plate, Inv. No. 701-560 USITC Pub. 590311 (Sept. 12,
 2016).
                 I. “Domestic Like Product”
     Commerce and the Commission play separate and dis-
 tinct roles in the administration of antidumping duty in-
 vestigations. 19 U.S.C. § 1673. Generally, Commerce
 investigates whether certain imported articles are sold in
 the United States at less than fair value, i.e., “dumped.”
 Cleo Inc. v. United States, 501 F.3d 1291, 1294 (Fed. Cir.
 2007). The Commission investigates whether a U.S. “do-
 mestic industry” is materially injured or threatened with
 material injury by reason of those imports. Id. at 1295.
     Central to antidumping duty investigations, and cen-
 tral to this appeal, are Commerce’s and the Commission’s
 separate determinations as to the products relevant to
 their respective inquiries. Commerce identifies the scope

     1   The investigations involved both antidumping duty
 and countervailing subsidies investigation. This appeal in-
 volves only the antidumping duty investigation.
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 4                      HITACHI METALS, LTD. v. UNITED STATES

 of imported articles subject to the investigation, referred to
 as the “subject merchandise.” Pesquera Mares Australes
 Ltda. v. United States, 266 F.3d 1372, 1374–75, 1375 n.2
 (Fed. Cir. 2001); see 19 U.S.C. § 1677(25). The Commission,
 on the other hand, determines the “domestic like product.”
 The “domestic like product” is a U.S. product “which is like,
 or . . . most similar in characteristics and uses” to the sub-
 ject merchandise. Cleo Inc., 501 F.3d at 1295 (quoting 19
 U.S.C. § 1677(10)). The Commission’s definition of which
 domestic goods constitute “like products” determines the
 relevant domestic industry and, in turn, the scope of the
 Commission’s injury analysis. Id.
      By statute, the Commission’s “domestic like product”
 analysis begins with a review of the “articles subject to in-
 vestigation,” i.e., the subject merchandise as determined by
 Commerce. 19 U.S.C. § 1677(10) (defining “domestic like
 product” as a “product which is like, or in the absence of
 like, most similar in characteristics and uses with, the ar-
 ticle subject to an investigation” (emphasis added)). The
 Commission then conducts a six-factor inquiry that evalu-
 ates whether the subject merchandise corresponds with a
 single domestic like product or multiple domestic like prod-
 ucts. Cleo, 501 F.3d at 1295. Specifically, the Commission
 compares the imported articles and domestic products by
 considering: (1) physical characteristics and uses; (2) chan-
 nels of distribution; (3) interchangeability; (4) customer
 and producer perceptions; (5) common manufacturing facil-
 ities, production processes, and production employees; and
 where appropriate (6) pricing. Id.; Timken Co. v. United
 States, 913 F. Supp. 580, 584 (Ct. Int’l Trade 1996). The
 Commission may determine that the subject merchandise
 identified by Commerce encompasses one or more domestic
 like products. Cleo, 501 F.3d at 1295.
             II. The Commission’s Investigation
    In May 2016, the Commission published its prelimi-
 nary determination which included a preliminary like
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 product determination. Carbon and Alloy Steel Cut-to-
 Length Plate, 81 Fed. Reg. 33705–06 (May 27, 2016) (Pre-
 liminary Determination); J.A. 121–136. The Commission
 reviewed Commerce’s subject merchandise determination
 and then performed the six-factor analysis based on the ev-
 identiary record existing at that time. J.A. 121–133. The
 Commission concluded that the U.S. domestic industry
 consists of “a single domestic like product consisting of all
 CTL plate coextensive with the scope of these investiga-
 tions.” J.A. 130 (emphasis added). Specifically, the Com-
 mission defined the domestic like product as:
     Certain carbon and alloy steel hot-rolled or forged
     flat plate products not in coils, whether or not
     painted, varnished, or coated with plastics or other
     non-metallic substances. Subject merchandise in-
     cludes plate that is produced by being cut-to-length
     from coils and plate that is rolled or forged into a
     discrete length. The products covered include (1)
     Universal mill plates (i.e., flat-rolled products
     rolled on four faces or in a closed box pass, of a
     width exceeding 150 mm but not exceeding 1250
     mm, and of a thickness of not less than 4 mm,
     which are not in coils and without patterns in re-
     lief), and (2) hot-rolled or forged flat steel products
     of a thickness of 4.75 mm or more and of a width
     which exceeds 150 mm and measures at least twice
     the thickness, and which are not in coils, whether
     or not with patterns in relief. The covered products
     described above may be rectangular, square, circu-
     lar or other shapes and include products of either
     rectangular or non-rectangular cross-section where
     such non-rectangular cross-section is achieved sub-
     sequent to the rolling process, i.e., products which
     have been ‘‘worked after rolling,’’ (e.g., products
     which have been beveled or rounded at the edges).
 J.A. 122–23. The Commission also incorporated certain
 limitations adopted in Commerce’s subject merchandise
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 6                      HITACHI METALS, LTD. v. UNITED STATES

 determination, such as limitations related to width and
 thickness, iron and carbon content, and third country pro-
 cessing. Id. In addition, the Commission incorporated
 Commerce’s seven express exclusions, which included:
 “products clad, plated, or coated in metal,” “military grade
 armor plate,” “stainless steel plate,” and “[a]lloy forged and
 rolled CTL plate.” J.A. 123–127. None of the limitations
 or exclusions related to tool steel.
      After the preliminary determination, the Commission
 issued questionnaires to relevant parties, including domes-
 tic producers, importers, purchasers, and foreign producers
 in the subject countries. See 19 CFR § 207.20(b). Before
 issuing the questionnaires, the Commission circulated
 drafts to the parties for comment. Id. Three importers,
 including Hitachi, submitted comments, asking the Com-
 mission to collect separate data for “tool steel” so that the
 Commission could consider whether tool steel is a separate
 domestic like product. The Commission granted the re-
 quest and issued a supplemental questionnaire seeking
 tool steel data from domestic producers. Four domestic
 producers responded with information. The Commission
 also contacted domestic producers who did not respond to
 the questionnaire. The Commission also collected addi-
 tional data via telephone and email from several of those
 producers.

      After receiving additional briefing and conducting the
 public hearing, the Commission undertook another domes-
 tic like product analysis in view of the full record. The
 Commission “examined closely whether the record sup-
 port[ed] finding a clear dividing line between tool steel and
 high speed steel on the one hand, and other CTL plate prod-
 ucts on the other.” J.A. 2118; see also J.A. 2111–2119. Af-
 ter noting that the evidence was “mixed,” the Commission
 found no clear dividing lines between tool steel and other
 CTL plate products and concluded that defining tool steel
 as a separate domestic like product was “not warranted.”
 Id. As a result, the Commission reaffirmed its preliminary
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 HITACHI METALS, LTD. v. UNITED STATES                        7

 determination of a single domestic like product coextensive
 with Commerce’s subject merchandise determination. Id.

              III. Court of International Trade
     Hitachi appealed the Commission’s final determina-
 tion to the Court of International Trade. 2 Hitachi argued
 that the Commission’s like product determination was le-
 gally erroneous and unsupported by substantial evidence.
 The Court of International Trade rejected Hitachi’s argu-
 ments and affirmed the Commission’s determination.
    Hitachi timely appealed. We have jurisdiction under
 28 U.S.C. § 1295(a)(5).
                          DISCUSSION
     This court conducts de novo review of appeals from the
 Court of International Trade that involve a Commission
 like product determination. In doing so, we apply the same
 standard of review applied by the Court of International
 Trade: we ask whether the Commission’s like product de-
 termination is “unsupported by substantial evidence on the
 record, or otherwise not in accordance with law.” 19 U.S.C.
 §§ 1516a(b)(1)(B)(i), 1516a(a)(2)(B)(i); Nippon Steel Corp.
 v. United States, 458 F.3d 1345, 1350 (Fed. Cir. 2006).
     Under the substantial evidence standard of review, “we
 must affirm a Commission determination if it is reasonable
 and supported by the record as a whole, even if some evi-
 dence detracts from the Commission’s conclusion.” Altx,
 Inc. v. United States, 370 F.3d 1108, 1121 (Fed. Cir. 2004)
 (internal citations and quotations omitted). While a party
 “may disagree with the conclusions drawn by the Commis-
 sion and offer reasonable, alternate explanations . . . , it is

     2  Daido Steel Co., Ltd. joined Hitachi in appealing
 the Commission’s final determination to the Court of Inter-
 national Trade. For purposes of this opinion, we refer to
 both parties as “Hitachi.”
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 8                     HITACHI METALS, LTD. v. UNITED STATES

 not the role of this court to refind the facts or interpose
 [our] own determinations.” Id. at 1123–24 (internal quota-
 tions omitted).
      Hitachi raises essentially the same three arguments
 that it raised to the Court of International Trade. Hitachi
 contends that the Commission’s like product determination
 was erroneous because: (i) the Commission unlawfully pre-
 sumed that the domestic like product was coextensive with
 Commerce’s subject merchandise determination; (ii) the
 Commission’s inclusion of tool steel unlawfully ignored a
 35-year established agency practice; and (iii) the Commis-
 sion’s inclusion of tool steel was not supported by substan-
 tial evidence. We address each argument in turn.
      First, Hitachi contends that the Commission’s like
 product analysis was legally erroneous because the Com-
 mission “employed a presumption that the domestic like
 product is coextensive with the scope” of investigation. Ap-
 pellant Br. 21–24; Oral Arg. at 1:30–7:15. Hitachi explains
 that Congress separately defined “domestic like product”
 and “subject merchandise” in 19 U.S.C. § 1677, and that
 the Commission failed to give those terms their separate
 meanings. Appellant Br. 17–18. Hitachi further contends
 that the Commission’s use of an “unlawful presumption” is
 evidenced by its “arbitrary” inclusion of tool steel and ex-
 clusion of “very similar” products like stainless steel. Ap-
 pellant Br. at 24, 41 n.18. Hitachi asserts that the subject
 merchandise is “irrelevant” to the Commission’s like prod-
 uct determination. Appellant Br. 22 (“whether a product
 falls in or out of the scope is irrelevant when determining
 whether it constitute[s] a separate like product”). We dis-
 agree.
     Commerce’s subject merchandise determination is not
 “irrelevant” to the Commission’s like product determina-
 tion. Just the opposite: the subject merchandise determi-
 nation is “necessarily the starting point of the
 Commission’s like product analysis.” Cleo, 501 F.3d at
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 HITACHI METALS, LTD. v. UNITED STATES                       9

 1298 n.1 (citing 19 U.S.C. § 1677(10)). The statute re-
 quires the Commission to consider Commerce’s subject
 merchandise determination in reaching its own like prod-
 uct determination. To do otherwise risks creating two dis-
 connected agency investigations.
      Hitachi cites cases holding that the Commission’s like
 product determination must be “separate and distinct”
 from Commerce’s subject merchandise determination. Ap-
 pellant Br. 19–20 (citing Hosiden Corp. v. Advanced Dis-
 play Mfrs. Of Am., 85 F.3d 1561, 1567 (Fed. Cir. 1996);
 Acciai Speciali Terni S.p.A. v. United States, 118 F. Supp.
2d 1298, 1304 (Ct. Int’l Trade 2000)). Those cases do not
 support Hitachi’s arguments. There is no dispute that the
 Commission’s like product determination must be separate
 and distinct from Commerce’s subject merchandise deter-
 mination. See Hosiden, 85 F.3d at 1568 (“Commerce’s des-
 ignation of the class or kind of merchandise sold at [less
 than fair value] does not control the Commission’s defini-
 tion of the industry injured in its sales of like products.”).
 Hitachi cites no authority that precludes the Commission
 from determining that the domestic like product and the
 subject merchandise are coextensive. See 19 U.S.C.
 § 1677(10) (defining domestic like product as the product
 “most like . . . the article subject to investigation” (empha-
 sis added)).
     We are also unpersuaded by Hitachi’s argument that
 the Commission was required to compare tool steel to prod-
 ucts outside of Commerce’s subject merchandise determi-
 nation. See Appellant Br. 24, 41 n.18. The statute does not
 require such a broad analysis. 19 U.S.C. § 1677(10). To
 the contrary, it instructs the Commission to confine its like
 product determination to a comparison between domestic
 products and “the article subject to an investigation.” See
 id. Hitachi provides no authority to the contrary.
     In Cleo, we rejected the argument that “the Commis-
 sion allowed Commerce’s finding to shape its like product
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 10                      HITACHI METALS, LTD. v. UNITED STATES

 determination.” 501 F.3d at 1298 n.1. We noted that the
 Commission had expressly recognized the “settled rule that
 Commerce’s [subject merchandise] finding does not control
 the Commission’s [like product] determination.” Id. In the
 present case, the Commission expressly articulated the
 same rule:
      Although the Commission must accept Commerce’s
      determination as to the scope of the imported mer-
      chandise that is subsidized or sold at less than fair
      value, the Commission determines what domestic
      product is like the imported articles Commerce has
      identified. . . . Cleo, 501 F.3d at 1298 n.1 (“Com-
      merce’s [scope] finding does not control the Com-
      mission’s [like product] determination]”).
 J.A. 2088–2089, 2089 n.12 (brackets in original). Here, as
 in Cleo, “we do not perceive that the Commission’s like
 product analysis was biased towards finding . . . a single
 like product in order to conform its finding with the scope
 of Commerce’s [determination].” See Cleo, 501 F.3d at 1298
 n.1.
      Second, Hitachi argues that the Commission’s like
 product analysis was legally erroneous because it disre-
 garded a 35-year “established practice” of “treating tool
 steel as separate and distinct from all other steel.” Appel-
 lant Br. 25–28. Hitachi explains that the Commission
 failed to either “conform itself to its prior decisions or ex-
 plain the reasons for departing from” its long-established
 agency practice. Appellant Br. 30. We disagree.
     The cases Hitachi cites involve proceedings brought
 under different statutory provisions, different products,
 and different periods of investigation. See J.A. 19–29. Hi-
 tachi fails to cite a single antidumping investigation that
 involved the same subject merchandise as this case and
 where tool steel was excluded from the Commission’s defi-
 nition of domestic like product. See id. As we have previ-
 ously explained, each antidumping duty investigation “is
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 HITACHI METALS, LTD. v. UNITED STATES                    11

 sui generis, involving a unique combination and interaction
 of many economic variables.” Nucor Corp. v. United States,
 414 F.3d 1331, 1340 (Fed. Cir. 2005). That the Commission
 reached different outcomes in cases with different circum-
 stances “do[es] not indicate that the Commission either
 committed legal error in the methodology it used in this
 case or departed from the mode of analysis it regularly em-
 ploys.” Cleo, 501 F.3d at 1299.
     Third, Hitachi argues that the Commission’s like prod-
 uct analysis is not supported by substantial evidence. Hi-
 tachi does not contest any specific aspect of the
 Commission’s factual findings. Instead, Hitachi faults the
 Commission for having “failed to fully collect” the infor-
 mation relevant to its like product analysis, and that the
 Commission “disregarded more than 90 percent of [the] rel-
 evant industry.” Appellant Br. 44–45, 50. Hitachi argues
 that the Commission’s failure to collect data led to an in-
 firm record and renders the like product determination un-
 supported by substantial evidence. We disagree.
     The Commission satisfied its obligation to conduct “in-
 vestigative activities” under 19 CFR § 207.20(b). In re-
 sponse to the supplemental questionnaires it issued at
 Hitachi’s request, the Commission received data from four
 domestic tool steel producers. The Commission also sought
 out non-responding manufacturers via telephone and
 email, and successfully collected data from several of those
 parties. Contrary to Hitachi’s argument that the Commis-
 sion “disregarded” information from tool steel producers,
 the record shows that several entities Hitachi named as
 tool steel producers reported that they do not produce tool
 steel. Based on the administrative record, we conclude
 that the Commission’s like product investigation and evi-
 dence collection was not unreasonable. As a result, the
 Commission’s like product conclusions are supported by
 “such relevant evidence as a reasonable mind might accept
 as adequate to support a conclusion.” Consol. Edison Co.
 of New York v. N.L.R.B., 305 U.S. 197, 229 (1938).
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 12                    HITACHI METALS, LTD. v. UNITED STATES

     We have considered Hitachi’s other arguments and
 find them unpersuasive.
                        CONCLUSION
     Finding no error in the Commission’s like product de-
 termination, we affirm the judgment of the Court of Inter-
 national Trade.
                        AFFIRMED
                           COSTS
      No costs.