Court Opinion

ID: 817524
Source: CourtListenerOpinion
Date Created: 2013-02-01 01:53:59.511854+00
Date Added: 2024-06-11T09:00:59.368612
License: Public Domain

Slip Op. 08-22

             UNITED STATES COURT OF INTERNATIONAL TRADE
___________________________________
                                     :
NAVNEET PUBLICATIONS (INDIA)        :
LIMITED,                             :
                                     :
                 Plaintiff,          :
                                     :
     v.                              :    Before: Richard K. Eaton,
                                     :            Judge
UNITED STATES,                       :
                                     :    Court No. 06-00401
                 Defendant,          :
     and                             :    Public Version
                                     :
ASSOC. OF AMERICAN SCHOOL PAPER     :
SUPPLIERS,                           :
                                     :
           Defendant-Intervenor.     :
___________________________________:

                             OPINION

[United States International Trade Commission’s Final
Determination sustained.]

                                           Dated: February 26, 2008

deKieffer & Horgan (Gregory S. Menegaz and John J. Kenkel), for
plaintiff Navneet Publications (India) Limited.

James M. Lyons, General Counsel, United States International
Trade Commission; Andrea C. Casson, Assistant General Counsel for
Litigation, United States International Trade Commission (Peter
L. Sultan), for defendant.

Wiley Rein LLP (Alan H. Price, Timothy C. Brightbill, and Maureen
E. Thorson), for defendant-intervenor Association of American
School Paper Suppliers.
Court No. 06-00401                                       Page 2

     Eaton, Judge: Before the court is the motion for judgment

upon the agency record of plaintiff Navneet Publications (India)

Limited (“Navneet”).   See Pl.’s R. 56.2 Mem. Supp. Mot. J. Agency

R. (“Pl.’s Mem.”).   Defendant the United States International

Trade Commission (“ITC” or the “Commission”) and defendant-

intervenor the Association of American School Paper Suppliers

(the “Association”) oppose Navneet’s motion.    See ITC’s Opp’n

Pl.’s Mot. J. Agency R. (“ITC’s Opp’n”); Association’s Revised

Resp. Br. (“Ass’n.’s Resp.”).

     By its motion, Navneet challenges the ITC’s final

determination that imports into the United States of certain

lined paper school supplies (“CLPSS”) from India are causing or

threaten to cause material injury to the United States CLPSS

industry.   See CLPSS from China, India, and Indonesia, 71 Fed.

Reg. 55,804 (ITC Sept. 25, 2006) (notice of final determination);

CLPSS from China, India, and Indonesia (Final), USITC Pub. 3884,

Inv. Nos. 701-TA-442-443 and 731-TA-1095-1097 (Sept. 2006)

(“Final Determination”) (final determination of material injury

to an industry by reason of imports of CLPSS from India and

Indonesia that were subsidized and of material injury or threat

of material injury by reason of imports of CLPSS from China,

India, and Indonesia due to sales at less than fair value).

Jurisdiction lies pursuant to 28 U.S.C. § 1581(c) (2000) and 19

U.S.C. § 1516a (a)(2)(B)(i).    For the reasons that follow, the
Court No. 06-00401                                          Page 3

court denies plaintiff’s motion.

                            BACKGROUND

     Navneet is an exporter of CLPSS from India.       Compl. ¶ 3.

The subject CLPSS

           are used primarily for taking notes and
           typically sold as school supplies. CLPSS
           encompass three main products: hole-punched
           filler paper, spiral-bound or wireless
           notebooks (with or without pockets and/or
           dividers), and composition books. Typically,
           the paper is lined with blue and/or red ink,
           wide ruled or college ruled, and white in
           color. The color of notebook and composition
           book covers varies from plain to those that
           display fashion graphics.

Final Determination at 3 (footnotes omitted).

     On September 9, 2005, the Association1 filed petitions with

both the United States Department of Commerce (“Commerce”) and

the ITC.   Final Determination at 3.   Following its

investigations, Commerce determined that imports into the United

States of CLPSS from India were being sold in the United States

at less than fair value (“LTFV” or “dumped”) and also found that

imports were subsidized by the government of India.       See Certain

Lined Paper Products from India, 71 Fed. Reg. 45,012 (Dep’t of

Commerce Aug. 8, 2006) (notice of final determination of sales at

     1
          The Association is comprised of MeadWestvaco
Corporation, Norcom, Inc., and Top Flight, Inc. Final
Determination at 3.
Court No. 06-00401                                        Page 4

less than fair value and negative determination of critical

circumstances); Certain Lined Paper Products from India, 71 Fed.

Reg. 45,034 (Dep’t of Commerce Aug. 8, 2006) (notice of final

affirmative countervailing duty determination and final negative

critical circumstances determination).

     For its part, the ITC instituted a material injury

investigation for the period from July 1, 2004 through June 30,

2005 for LTFV sales, (71 Fed. Reg. 45,012), and for the period

from April 1, 2004 through March 31, 2005 for subsidization (71

Fed. Reg. 45,034).   At the conclusion of this investigation the

Commissioners determined that “an industry in the United States

is materially injured by reason of subject imports of CLPSS from

India and Indonesia that are found to be subsidized, and by

reason of subject imports of CLPSS from China, India, and

Indonesia that are found to be sold in the United States at

LTFV.”   Final Determination at 49.

                        STANDARD OF REVIEW

     When reviewing an agency’s final determination, the court

will hold unlawful agency determinations, findings, or

conclusions that are “unsupported by substantial evidence on the

record or otherwise not in accordance with law . . . .”    19

U.S.C. § 1516a(b)(1)(B)(i).   “As long as the agency’s methodology

and procedures are reasonable means of effectuating the statutory
Court No. 06-00401                                         Page 5

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. v. United States, 10 CIT 399, 404-5, 636 F. Supp. 961, 966

(1986), aff’d, 810 F.2d 1137 (Fed. Cir. 1987) (citations

omitted).

                            DISCUSSION

I.   Legal Framework: The ITC’s Negligibility Determination

     Under the unfair trade laws, Commerce determines whether

foreign imports into the United States are either being dumped or

subsidized (or both).   It is for the ITC to determine whether

these dumped or subsidized imports are causing material injury to

a domestic industry in the United States.   See 19 U.S.C.

§§ 1673(1) & (2), 1671(a)(1) & (2).   If the Commission determines

that imports from a particular country are negligible, however,

it terminates its investigation without reaching the injury

question.   See 19 U.S.C. §§ 1673b(a)(1) (preliminary dumping

determination), 1673d(b)(1) (final dumping determination),

1671b(a)(1) (preliminary subsidization determination),

1671d(b)(1) (final subsidization determination).   It is

plaintiff’s claim that this is what should have happened here.

     Negligibility is addressed in 19 U.S.C. § 1677(24)(A), which
Court No. 06-00401                                         Page 6

provides that “imports from a country of merchandise

corresponding to a domestic like product identified by the

Commission are ‘negligible’ if such imports account for less than

3 percent of the volume of all such merchandise imported into the

United States” during a defined twelve-month period2 in an

antidumping or countervailing duty investigation.   19 U.S.C.

§ 1677(24)(A)(i).    Importantly, in countervailing duty

investigations involving merchandise from “developing countries,”

such as India, the imports will be found to be negligible if they

account for less than four percent of the volume of all such

merchandise imported into the United States.3   19 U.S.C.

§ 1677(24)(B).

     In computing import volumes for purposes of determining

whether imports are negligible, “the Commission may make

reasonable estimates on the basis of available statistics.”     19

U.S.C. § 1677(24)(C); see also Uruguay Round Agreements Act

     2
          Pursuant to the statute, merchandise is measured as it
was imported in the year prior to the filing of the petition (or
the initiation of the investigation if initiated by the
administering authority). 19 U.S.C. § 1677(24)(A)(i). To make
its negligibility finding with respect to India, the ITC measured
the volume of Indian imports into the United States between
September 2004 through August 2005. Final Determination at 16-
17.
     3
          A “developing country” is “a country designated as a
developing country by the [United States] Trade Representative.”
19 U.S.C. § 1677(36)(A). The United States Trade Representative
has designated India as a developing country. See 15 C.F.R.
§ 2013.1 (2005).
Court No. 06-00401                                       Page 7

Statement of Administrative Action, accompanying H.R. Rep. No.

103-316 656 835 (1994), reprinted in 1994 U.S.C.C.A.N. 3773, 4188

(recognizing that the “Commission may not have access to either

complete questionnaire data or official import statistics

conforming exactly to the Commission’s like product(s)

designations”).

II.   The ITC’s Negligibility Determination With Respect to
      Imports of CLPSS from India

      A.    The ITC’s Use of a Quantity-Based Measure of Volume

      In this investigation, the ITC used a quantity-based measure

to determine the volume of Indian CLPSS imports for purposes of

determining negligibility.   Specifically, the ITC measured volume

by “units”4 or pieces, rather than using a value-based measure of

volume, i.e., dollar value of imports.   Final Determination at 19

n. 144.    In doing so, the ITC explained that it typically uses

quantity-based measures “because value-based measures can be

skewed by changes of product mix and the fact that, for subject

imports, the unit values are of merchandise sold at LTFV.”     Id.

In other words, using a value-based measure could be distortive

      4
          A unit refers to “an individual product unit, such as a
notebook or a package of filler paper.” Pl.’s Mem. 10 (“A ‘unit’
is not an equilibrating unit of measure; rather it reflects the
absence of uniformity or commonality of measurement.”) (citation
omitted); Final Determination at 16 n. 123 (noting a unit is
known as an “each” in industry parlance).
Court No. 06-00401                                         Page 8

because of differences in the value of similar merchandise.     For

example, using a value-based measure, if some nations exported a

small number of high value items to the United States, and

others, such as the Indian exporters, sent a large number of low

cost items to the United States, the lower cost Indian

merchandise would make up a small percentage of the total

imports.   As a result, the value measurement would fail to

accurately measure the high percentage volume (in terms of page

count) of the lower cost merchandise that was being imported into

the United States.   A further distortion would occur when

merchandise is being sold at LTFV, because that merchandise would

necessarily represent an artificially lower percentage of all

CLPSS, if measured by import value.   Because of the potential for

distortion when using value-based measures, quantity-based

measurement is the ITC’s standard practice, as both plaintiff and

defendant acknowledge.   See ITC’s Opp’n 2;   Tr. Conf. Oral

Argument (Jan. 4, 2008) at 4.

     The ITC states that it departs from its usual practice only

where “there are such great variations among the products

involved that reliance on a quantity-based measure of volume

would be fundamentally distortive.”   ITC’s Opp’n 2.   In its Final

Determination, the Commission stated:

           Although the Commission has relied
           principally on value-based measurements in
           rare instances, those investigations involved
Court No. 06-00401                                          Page 9

            variations in value among articles within the
            scope and/or domestic like product that were
            much larger than those present here. In
            those instances, measuring volume by units
            was particularly problematic, because value
            variations for different articles could
            differ by factors of as much as 100.

Final Determination at 19 n. 144.   Thus, Commerce has relied

heavily on price variation among the imported articles of

merchandise as the determining factor when abandoning its usual

practice.   Put another way, in those cases where it has used

value-based measures, there has been a great variety of products,

and the value of the merchandise had variations of “factors of as

much as 100.” Final Determination at 19 n. 144 (citing, inter

alia, Ball Bearings from China, Inv. No. 731-TA-989 (Final),

USITC Pub. 3593 at 11 (Apr. 2003); Outboard Engines from Japan,

Inv. No. 731-TA-1069 (Final), USITC Pub. 3752 at 24-27 & n. 175

(Feb. 2005)).

     Plaintiff, however, insists that it fits within the

exceptions made in previous ITC investigations.   For Navneet, the

sheer variety of in-scope5 products makes its case.

     5
          Merchandise that is within the scope of an antidumping
review conducted by Commerce is referred to as “in-scope
merchandise;” merchandise that is not within the scope of the
antidumping review is termed out-of-scope merchandise. See SKF
USA Inc. v. Ina Walzlager Schaeffler KG, 180 F. 3d 1370, 1373
(Fed. Cir. 1999); Antidumping Manual Ch. 1 at 13 (Jan. 22, 1998)
(available at http://www.ia.ita.doc.gov) (“The [Department of
Commerce] also determines the scope of an investigation. The
scope of an investigation may also be referred to as the class or
                                                   (continued...)
Court No. 06-00401                                         Page 10

          At the hearing, the Commission was presented
          with samples and testimony by counsel for
          Indonesian and Indian respondents of 150
          sheet filler paper packs, 500 sheet filler
          paper packs, 70 page one subject spiral
          notebooks, and 250 sheet five subject
          notebooks, 100 sheet composition books and
          160 sheet composition books as well as an 800
          page composition book. Obviously, this was
          but a small demonstration of the variety of
          types and dimensions of products included
          with the scope of the investigations.

Pl.’s Mem. 10-11.    Navneet also argues that its merchandise

showed a variation in price that necessitated a value-based

measurement.

          Indeed, filler paper alone ranges from 30-
          count to 500-count, which is a substantial
          difference in weight. In addition, Public
          [sic] testimony at the Hearing, which
          included demonstrations and submissions of
          samples to the Secretary of the Commission,
          indicates that price is associated with the
          cost of the paper, which is the
          overwhelmingly most significant raw material
          by weight. Therefore, it is reasonable to
          infer that significant differences in unit
          value indeed exist . . . .

Pl.’s Mem. 20.

     In its Final Determination, the ITC stated that it would

employ its normal methodology: “Consistent with our customary

practice, we have relied on quantity-based measures of volume in

this investigation.”   Final Determination at 19 n. 144.    The ITC

     5
      (...continued)
kind of merchandise under investigation or the merchandise
subject to the investigation. A single investigation involves a
class or kind of merchandise.”)
Court No. 06-00401                                        Page 11

contrasted this case with other cases where there was a

“demonstrably wide variation among products” in volume or price.

See ITC’s Opp’n 12.   The ITC states:

          For example, in Ball Bearings from China, the
          Commission noted that there was a “vast and
          disparate grouping of items differing in
          size, configuration, application, and
          precision,” and that “it would present a
          distorted picture of the market to consider a
          commodity bearing costing less than one
          dollar as equivalent to a precision bearing
          costing hundreds or even thousands of
          dollars.” In Outboard Engines from Japan,
          the Commission explained that it relied on
          value data to assess the volume of subject
          imports “given the wide spectrum of engine
          sizes covered by the investigation and the
          wide variation in the unit value of engines
          of different sizes.” It explained that the
          manufacturer’s suggested retail prices for
          outboard engines range from under $1,000 to
          about $20,000.

ITC’s Opp’n 12 (citations omitted).

     The court agrees with the ITC.     In contrast to the cases

where the ITC has used value-based measurements, Navneet has not

shown that its products vary so widely in either variety or price

so as to create a substantial distortion.    While the scope used

by Commerce in its investigation contained a variety of products,

the Indian respondents’ actual sales were concentrated in

relatively few products: (1) 70 count single subject notebooks;

(2) 150 count filler paper; and (3) 100 count composition books.

CLPSS from China, India, and Indonesia, Staff Report to the

Commission on Inv. Nos. 701-TA-442-443 and 731-TA-1095-1097
Court No. 06-00401                                             Page 12

(Final) (Aug. 15, 2006)(“Staff Report”) at Tables V-1, V-2, and

V-4.       Other arguably in-scope items made up a relatively small

amount of the volume of merchandise exported to the United

States.       Id. at Tables V-3 and V-6.   Thus, with respect to what

was actually imported, plaintiff has not shown a particularly

wide variety of product.

       Navneet also fails to show variety in terms of price.       An

examination of the record evidence reveals that, while there was

some variation in price, it was within a relatively tight range.6

That is, the data on pricing products showed little difference in

price when adjusted for the product differences, i.e., size or

page-count.       See Staff Report at Tables V-1, V-3 & V-6.

       6
               The ITC collected data on six pricing
               products: a 70-count single-subject notebook,
               a 150-count pack of filler paper, a 180-count
               five-subject notebook, a 100-count marbled
               composition book, an out-of-scope 50-count
               legal pad, and an 80-count “fashion” notebook
               (i.e., one with licensed artwork or other
               unusual cover details, such as beadwork,
               textiles, etc.). Across the five in-scope
               products, the lowest price was [[     ]] for
               the [[
               ]]. The highest prices were [[
                                             ]] and [[

               ]]. Among Indian merchandise, there was even
               less variation: the lowest price was [[
                                    ]] and the highest price
               was [[
                 ]].

Ass’n.’s Resp. 6-7 (citations omitted).
Court No. 06-00401                                      Page 13

     In addition, a value based measure would not give a true

picture of the amount of Indian paper that was entering the

United States.   The record indicates that “fashion” notebooks,

which typically have artwork and special covers, have a much

greater value than a regular notebook having a similar page

count. See Staff Report at Tables IV-5, V-1, V-2.   Therefore, in

a value based comparison, this difference in value among products

with similar paper count would overstate the proportion of

“fashion” notebooks while understating the proportion of plain

notebooks, even though the number of units imported might be the

same. See Final Determination at 19 n. 144 (“We typically rely on

quantity-based measures of volume because value-based measures

can be skewed by changes of product mix.”).   As previously

noted, India exports to the United States relatively few higher

priced “fashion” notebooks, and thus a value-based measure would

tend to understate the amount of paper it introduces into the

United States market.   See Staff Report at Table V-6; Ass’n.’s

Resp. 10.7

     7
          Contrary to Navneet’s argument that the Commission
precluded it from showing evidence of variability among CLPSS
products because it failed to request or require “further
‘evidence demonstrating how much volume variation among imports
exists,’”(Pl.’s Mem. 20), the record shows that the ITC invited
the parties to address this question at two separate points in
the administrative process. See CLPSS, Inv. Nos. 701-TA-442-443
and 731-TA-1095-1097 (Preliminary), USITC 3811 (Oct. 2005) at 25
n. 110 (Preliminary Determination); Tr. Final Phase Hearing
                                                   (continued...)
Court No. 06-00401                                      Page 14

     The Commission is charged with the responsibility to

calculate import volumes for purposes of negligibility by making

“reasonable estimates on the basis of available statistics.”    19

U.S.C. § 1677(24)(C).   Based on the foregoing, it cannot be said

that the Commission’s decision to use volume- rather than value-

based measures was unreasonable or that plaintiff has

demonstrated that valuation based on price would yield a more

accurate result than the ITC’s volume methodology.   See, e.g.,

Koyo Seiko Co., Ltd. v. United States, 31 CIT __, __, 516 F.

Supp. 2d 1323, 1341 (2007) (“NTN did not satisfy its burden of

showing that its allocation method did not cause inaccuracies or

distortions.”); Shakeproof Assembly Components Div. of Ill. Tool

Works, Inc. v. United States, 30 CIT __, __, Slip Op. 06-129 at

15-16 (2006) (not reported in the Federal Supplement)

(“Defendant-Intervenor offers no compelling reason for why such a

constructed average would result in a more accurate valuation

here than simply using information taken directly from the period

of review.”) (footnote omitted).   The court sustains the

Commission’s finding.

     7
      (...continued)
(“Hearing Transcript”) (July 25, 2006) at 189-190.   Navneet had
ample opportunity to present its case.
Court No. 06-00401                                       Page 15

     B.   The ITC’s Use of a Conversion Factor

     In conducting its investigation, the ITC found that one type

of imported product did not easily conform to the volume-based

(i.e., unit-based) methodology.8   Filler paper is imported under

a Harmonized Tariff Schedule of the United States (“HTSUS”)

subheading that measures imports by weight, not units.   Thus, the

Commission converted the data from HTSUS statistical reporting

number 4811.90.90909 from kilograms to units using a conversion

factor, i.e., weight to pages.10

     Navneet challenges the ITC’s use of the conversion factor:

     8
          As previously noted, plaintiff’s imports fell generally
into three categories: hole-punched filler paper; spiral-bound or
wireless notebooks; and composition books. See Final
Determination at 3. As a result of its investigation, the ITC
found that most covered merchandise was imported under
classification subheadings 4811.90.9090 and 4820.10.2050. Final
Determination at 18. Subheading 4820.10.2050, covering notebooks
and composition books, recorded entries on a unit basis. Entries
made under the tariff provision for filler paper, (subheading
4811.90.9090), however, recorded entries on a kilogram basis.
     9
          The reporting number includes: “Paper, paperboard,
cellulose wadding and webs of cellulose fibers, coated,
impregnated, covered, surface-colored, surface-decorated or
printed, in rolls or rectangular (including square sheets, of any
size, other than goods of the kind described in heading 4803,
4809, or 4810)”. Staff Report at I-II, Table I-3; Navneet’s
Post-Hearing Br. Ex. 4a.
     10
          Of the products within the scope of these
investigations, the merchandise reported under HTSUS 4811.90.9090
includes filler packages, the most common being the 150-count
packages, and loose paper, for which volume is recorded in
kilograms. ITC’s Opp’n 18-19. Therefore, the conversion factor
was only applied to merchandise reported under HTSUS
4811.90.9090. Id.
Court No. 06-00401                                        Page 16

          There is no reasonable way to convert pieces
          to kilograms or kilograms to pieces because
          there is no information on this record other
          than speculation that would provide a basis
          to determine the exact nature of the [CLPSS]
          or their material components (and thus their
          weight) included in a “unit” or piece in the
          official statistics.

Pl.’s Mem. 10.

     The ITC converted the kilograms of paper under 4811.90.9090

to a unit basis, using a conversion factor based on the weight of

150-count filler paper, as provided by the Association in the

petition.11    Final Determination at 18 n. 139, IV-1 n. 6.   No

other party submitted a potential conversion factor during the

investigation.    See ITC’s Opp’n 19; Pl.’s Reply Br. 9; Ass’n.’s

Resp. 14-15.

     Before the court, Navneet goes beyond questioning the use of

a conversion factor by insisting that a different conversion

factor be used.    Pl.’s Mem. 12-14, Exs. 1, 2.   Specifically,

Navneet argues that there is an “industry standard” formula for

     11
          The ITC stated:

     We note that quantity data for statistical reporting
     number 4811.90.9000 was converted from kilograms using
     a conversion factor suggested by Petitioner, reflecting
     the per-unit weight of what it identifies as the most
     common filler paper package (150-count at 0.491262 kg).
     Importers’ responses to the Commission’s questionnaire
     confirm that the most common filler paper package
     contains 150 sheets of paper.

Final Determination at 18 n. 139 (citations omitted).
Court No. 06-00401                                        Page 17

converting kilograms into units of paper.    Pl.’s Mem. 12.

Plaintiff argues:

          Since petitioners’ conversion ratio does not
          correspond to the industry standard for
          school filler paper – or the Commission’s
          definition derived therefrom, and since
          petitioners’ conversion appears to inflate
          the quantity they used for the conversion
          even for the product they describe, the Court
          should strike their conversion ratio and
          remand on this basis alone.

Pl.’s Mem. 14.

     Plaintiff’s claims are unavailing.     By translating the

weight of the filler packs and loose paper into “units” of the

“most common filler paper package (150-count),” the Commission

made a “reasonable estimate on the basis of available

statistics.”   19 U.S.C. § 1677(24)(C).   The conversion factor was

not complex, but merely translated the weight of paper into units

in order to get a common basis for measurement.    Moreover,

Navneet’s claim that “[t]he extensive choice and variety of in-

scope retail products in these categories [HTSUS 4820.10.2050 and

HTSUS 4811.90.9090] renders ‘conversion’ of each ‘unit’ into

kilograms . . . a highly speculative exercise[,]”12 is

unconvincing. Pl.’s Mem. 11.   The conversion factor was not

applied to a variety of merchandise but only to filler paper.

     12
          Navneet inverts the phrasing here, but the court
assumes that it challenges the conversion of kilograms into units
as that was the conversion done by the ITC.
Court No. 06-00401                                      Page 18

ITC’s Opp’n 19. (“[O]nly filler paper packs and loose paper were

subject to the kilograms-to-units conversion, [such that]

application of the conversion factor would not have resulted in

any distortion at all.”)

     There is nothing inherently unreasonable about determining

the weight of 150 pages of filler paper and then converting that

weight into units.   While it is not impossible that the ITC

improperly determined the weight-to-page count ratio, plaintiff

failed to place any evidence on the record in the administrative

proceeding indicating that the ITC’s chosen conversion factor

yielded an inaccurate result.

     Moreover, during the investigation Navneet failed to present

to the ITC any evidence regarding an alternative conversion

factor.   That is, Navneet never suggested to the ITC its own

amount for the number of pages of filler paper per kilogram or

that an industry standard existed.   Navneet’s sole reference to

the conversion factor made in the administrative proceedings was

in Navneet’s post-hearing brief where it stated, “there is simply

no reasonable way to convert . . . kilograms to pieces.”

Navneet’s Post-Hearing Br. 4.   This argument is, of course,

undercut by plaintiff’s claim before the court that there is an

industry standard.

     As to plaintiff’s insistence that there is an industry

standard that the ITC should have used as a conversion factor,
Court No. 06-00401                                      Page 19

that matter cannot be reviewed by this court.   Navneet had its

opportunity to introduce its evidence of an industry standard

during the proceedings before the ITC and failed to do so.   The

court’s review of the Commission’s determination must be based

solely on the agency record.   See Titanium Metals Corp. v. United

States, 25 CIT 648, 663 n. 12, 155 F. Supp. 2d 750, 765 n. 12

(2001) (refusing to review two exhibits which were not part of

administrative record);   Kerr-McGee Chem. Corp. v. United States,

21 CIT 1179, 1180-82, 985 F. Supp. 1162, 1163-64 (1997) (holding

that evidence on arguments not presented to or obtained by

Department of Commerce during course of administrative review

were not properly part of the record for review).   Plaintiff has

therefore waived this argument.   Holmes Prods. Corp. v. United

States, 16 CIT 1101, 1103 (1992) (finding plaintiff’s arguments

waived for failing to raise them before the agency).   Therefore,

the court finds the ITC’s use of a conversion factor to be

reasonable and Navneet’s arguments and evidence regarding the

accuracy of the conversion factor to be outside of the record and

thus not reviewable by this court.

     C.   The ITC’s Choice of Harmonized Tariff Schedule of the
          United States Statistical Reporting Categories for
          Determining Volume

     In order to measure the volume of CLPSS imports during the

September 2004 to August 2005 period, the ITC chose the HTSUS
Court No. 06-00401                                       Page 20

statistical reporting numbers that were actually used to enter

the merchandise by importers.   Navneet contests this choice.

     In the investigation, the ITC found that there were problems

with the data from questionnaire responses and with official

import statistics.    The ITC stated that “[t]he questionnaire

responses yielded a low percentage of import coverage, as the

data submitted by responding importers for 2005 [was] equivalent

to 39 percent of the value of total U.S. imports of CLPSS.”

Final Determination at 17 (footnote omitted).   There is no

dispute among the parties that there were problems with the

questionnaire responses.   Pl.’s Mem. 9-10; see also Def.’s Mem.

6.

     As a result, the ITC concluded, “In light of the

deficiencies in the questionnaire data, we rely on the official

import statistics.”   Final Determination at 17.   Having concluded

that it would rely on official statistics, the ITC was required

to decide “under which HTSUS statistical reporting numbers we

should measure subject merchandise.”   Final Determination at 17.

The ITC determined that, rather than rely on all of the HTSUS

subheadings chosen by Commerce in its scope determination, it

would use the two subheadings under which a large majority of

merchandise was entered, i.e., HTSUS 4820.10.2050 and

4811.90.9000.

     Specifically, the ITC stated
Court No. 06-00401                                        Page 21

          The record indicates that all but four of the
          32 responding firms reported importing CLPSS
          under statistical reporting number
          4820.10.2050 during the period of
          investigation. Seven firms reported
          importing CLPSS under number 4811.90.9090,13
          while six firms reported importing CLPSS
          under reporting number 4820.10.2020.14
          Because statistical reporting number
          4820.10.2020, covering “memorandum pads,
          letter pads and similar articles,” contains
          predominately non-subject note pads and
          letter pads and the majority of responding
          U.S. importers identified statistical
          reporting numbers 4811.90.9000 and
          4820.10.2050 more frequently, we find on
          balance that the official import statistics
          provided under those two statistical
          reporting numbers (4820.10.2050 and
          4811.90.9000) are a more comprehensive and
          accurate measure of import volume.

Id. at 18 (footnote omitted).   In other words, while additional

     13
          “Effective July 1, 2005, statistical reporting number
4811.90.9000 was divided into two numbers. The appropriate
statistical reporting number for filler paper after that date is
4811.90.9090.” Final Determination at 17 n. 133 (citation
omitted). The two numbers are referred to interchangeably in the
record and in this opinion.
     14
          One U.S. importer reported importing subject CLPSS
          under HTSUS number 4810.2010. We also acknowledge that
          five or fewer firms responding to our importers’
          questionnaire indicated that they import subject CLPSS
          under HTSUS statistical reporting numbers other than
          the [sic] those identified by Commerce’s scope. As the
          majority of responding importers do not use statistical
          reporting number 4810.10.2010 as well as other
          statistical reporting numbers not identified in
          Commerce’s scope language, we conclude that they
          contain mostly non-subject merchandise and do not
          provide an accurate means of assessing subject import
          volume.

Final Determination at 18 n. 138 (citations omitted).
Court No. 06-00401                                        Page 22

HTSUS subheadings were identified by Commerce as within the scope

of its investigation, HTSUS numbers 4820.10.2050 and 4811.90.9000

were used by most importers to classify the subject merchandise

upon actual importation during the period of investigation.

     The Indian respondents argued, as does plaintiff here, that

the ITC should utilize all five statistical reporting numbers (or

some combination thereof) used by Commerce in the scope of its

investigation to analyze negligibility.15   It can be presumed

that the inclusion of these other subheadings would result in a

ratio favoring plaintiff’s negligibility claim.

     The ITC states that it “does not dispute that some subject

merchandise might have been entered (whether through correct or

incorrect tariff classification by importers) under the

additional tariff subheading[s] listed in Commerce’s scope.”

     15
          The five statistical reporting numbers identified by
Commerce were: 4810.22.5044 (hole-punched looseleaf paper and
paper coated with clay or other inorganic materials),
4811.90.9090 (filler paper and loose paper), 4820.10.2010
(diaries and address books), 4820.10.2020 (memorandum pads,
letter pads and similar articles), 4820.10.2050 (notebooks). See
Final Determination at 17 (footnotes omitted); Navneet’s Post-
Hearing Br. Ex. 4a.

     Indian Respondents proposed four additional HTSUS
statistical reporting numbers for inclusion in the ITC’s
analysis: 4820.10.4000 (registers and account books, of paper or
paperboard), 4802.62.6040 (products containing unlined paper),
4820.30.0020 (looseleaf binders, (other than book covers), of
paper or paperboard), and 4820.30.0040 (binders (other than book
covers), except looseleaf, folders and file covers, of paper or
paperboard). See Final Determination at 17-18 (footnotes
omitted); Navneet’s Post-Hearing Br. Ex. 4a.
Court No. 06-00401                                        Page 23

ITC’s Opp’n 25 (footnote omitted).

          The fact that some within-scope products
          might occasionally be entered under a tariff
          subheading does not justify including all
          imports under that subheading in the
          computation of the volume of subject imports,
          where the evidence shows that the tariff
          subheading applies predominantly to out-of-
          scope products. Including all imports under
          such tariff category would have been
          inconsistent with the Commission’s mandate to
          make “reasonable estimates on the basis of
          the available statistics.”

Id. (footnote omitted).

     As the Commission notes, it is charged with making

“reasonable estimates on the basis of the available statistics.”

19 U.S.C. § 1677(24)(C).   In addition, the statute indicates that

the Commissioners are to make an independent determination as to

what imports are to be considered.16 See 19 U.S.C. § 1677(24)(A)

     16
          Navneet also argued that the ITC erred because “the
Commission normally accepts the tariff numbers identified by
Commerce as setting the boundaries of the negligibility data.”
Pl.’s Mem. 21. The ITC, however, need not apply each tariff
number listed in Commerce’s scope determination:

          The Commission certainly begins each domestic
          like product analysis with Commerce’s
          description of the scope of the
          investigation. As in the preliminary Views
          of these investigations, the Commission does
          not, as a matter of practice, apply each
          tariff number included in that description to
          measure subject import volume. Rather, the
          Commission makes “reasonable estimates on the
          basis of available statistics” of pertinent
          import levels for purposes of deciding
          negligibility. Moreover, by Commerce’s
                                                   (continued...)
Court No. 06-00401                                         Page 24

(“[I]mports from a country of merchandise corresponding to a

domestic like product identified by the Commission are

‘negligible’ if such imports account for less than 3 percent of

the volume of all such merchandise imported into the United

States in the most recent 12-month period for which data are

available . . . .”)(emphasis added).

     Moreover, the inclusion of some within-scope merchandise

under a tariff subheading that predominantly applies to out-of-

scope products does not undermine the reasonableness of the ITC’s

determination not to use those subheadings in its analysis.      The

ITC determined that, on balance, a more accurate estimate could

be reached by excluding tariff subheadings that included mostly

out-of-scope and only some in-scope products.     The court cannot

find that this was unreasonable.     See Nippon Steel Corp. v.

United States, 458 F. 3d 1345, 1352 (Fed. Cir. 2006) (“[The

court] must affirm a Commission determination if it is reasonable

and supported by the record as a whole, even if some evidence

detracts from the Commission’s conclusion.”)(citations and

     16
          (...continued)
              admission, the six HTSUS statistical
              reporting numbers are merely reflective of
              the typical headings under which subject
              merchandise is imported and are not
              dispositive.

Final Determination at 18-19 n. 140 (citations omitted). See
also Wooden Bedroom Furniture from China, Inv. No. 731-TA-1058
(Final), USITC Pub. 3743 at 18-20, IV-1 n.4 (Dec. 2004).
Court No. 06-00401                                      Page 25

quotation omitted).

     D.   The ITC’s Decision Not to Make a Downward Adjustment to
          Official Import Statistics in Measuring the Volume of
          Indian Imports

     Finally, Navneet takes issue with the ITC’s denial of its

request that the official import statistics be adjusted downward

“to remove the volume of non-subject merchandise [exported from

India] from the total volume reported” under HTSUS subheadings

4820.10.2050 and 4811.90.9000. Final Determination at 18

(footnote omitted).   According to plaintiff, the adjustment would

provide a more accurate result.

     Plaintiff’s “proposed reductions were based on an estimate

in an email from an executive at ‘American Scholar,’ a U.S.

producer of CLPSS that also has production operations in India.”

ITC’s Opp’n 26 (citing Hearing Transcript at 234).17   The email

stated that, based on the writer’s experience with the subject

merchandise, there was a percentage of in-scope products within

the chosen tariff numbers that could be estimated fairly and

accurately.18   Navneet insists that the email provides the basis

     17
          See also [[
            ]] (“Aug. 25 E-mail”).
     18
          The email read as follows:

          [[
                                                    (continued...)
Court No. 06-00401                                               Page 26

for determining the amount of out of scope merchandise in each

HTSUS subheading.     The email thus constituted a proposal by

Navneet to reduce the import data under HTSUS statistical numbers

4820.10.2050 and 4811.90.9000 by the writer’s estimated

percentages of subject and non-subject merchandise.

     The Commission received the proposal to reduce the volume

under the two selected HTSUS reporting numbers on the day the

record closed.     Final Determination at 18-19.19        According to the

ITC, because of the record closing, it was impossible for the ITC

staff to verify the accuracy of the proposed reductions, which in

any event were submitted without an explanation of the

methodology employed.           Id.   Moreover, the ITC stated that

“subject imports from India and Indonesia still are not

     18
          (...continued)

                           ]]

Aug. 25 E-mail. According to this proposal, Navneet sought to
reduce the import data under HTSUS statistical number
4820.10.2050 by [[      ]] and under HTSUS statistical number
4811.90.9090 by [[      ]]. See Id.
     19
           The proposal was sent via email at 4:04 p.m. on Friday,
August 25, 2006, the day the record closed. ITC’s Opp’n 26; Aug.
25 E-mail.
Court No. 06-00401                                         Page 27

negligible when the HTSUS statistical reporting numbers are

reduced by the highest, middle, and lowest proposed percentages.”

Final Determination at 19 n. 142 (citations omitted).

     Plaintiff objects that the Commission unreasonably refused

to “take into account record evidence clearly indicating that the

HTSUS numbers under consideration were not composed exclusively

of subject merchandise.”   Pl.’s Mem. 23-24 (footnote omitted).

Plaintiff further claims that the Commission itself “often” puts

new information on the record at the close of an investigation.

Pl.’s Mem. 25.   In support of its position that the other parties

would not be prejudiced “even when critical information is placed

on the record and disclosed to parties on the last day that the

record was open,” plaintiff cites to Sichuan Changhong Elec. Co.,

Ltd. v. United States, 30 CIT ___, 466 F. Supp. 2d 1323 (2006)

(“Sichuan”), stating that the case upheld the ITC’s decision to

put information on the record on the day it closed because

respondents had the opportunity to provide final comments a few

days later.   Pl.’s Mem. 25.

     Sichuan is distinguishable from this case.   As the

Commission points out, in Sichuan:

          the computations that were placed on the
          record shortly before its closing (the one-
          page digest of the domestic industry’s
          financial information) were based on data
          that had been submitted earlier; and there
          was no suggestion that the data had been
          submitted without any explanation, or that
Court No. 06-00401                                        Page 28

           the Commission staff had been unable to
           verify the accuracy of the data. In short,
           the circumstances were quite different from
           those surrounding the American Scholar email
           in the CLPSS investigations.

ITC’s Opp’n 29 (citations omitted).

     The ITC has surely received new evidence late in other

proceedings, but in this case it reasonably excluded the

submission.    See Gen. Motors Corp. v. United States, 17 CIT 697,

702-03, 827 F. Supp. 774, 780-781 (1993) (“Given the lateness of

the plaintiffs’ allegations, ITC’s decision not to conduct a

supplemental investigation was reasonable.”).   First, Navneet

submitted its proposed reductions without any explanation or

description of the methodology by which they were reached.    As a

result, in order to render the methodology useful, the Commission

would have been required to reopen the record to verify the

accuracy of the proposed reductions and provide the other parties

the opportunity to submit any analysis or new factual information

in response.   The antidumping statute requires time for public

comment:

           Information that is submitted on a timely
           basis to the administering authority or the
           Commission during the course of a proceeding
           under this subtitle shall be subject to
           comment by other parties to the proceeding
           within such reasonable time as the
           administering authority or the Commission
           shall provide. The administering authority
           and the Commission, before making a final
           determination . . . shall cease collecting
           information and shall provide the parties
Court No. 06-00401                                       Page 29

          with a final opportunity to comment on the
          information obtained by the administering
          authority or the Commission (as the case may
          be) upon which the parties have not
          previously had an opportunity to comment.
          Comments containing new factual information
          shall be disregarded.

19 U.S.C. § 1677m(g).    Had the ITC accepted the proposal without

offering time for the other parties to comment, it would have

contravened the statute.

     Most tellingly, however, the subject imports would not be

negligible even if the proposed percentages were used to reduce

the reporting numbers.   Final Determination at 19 n. 142.

Therefore, the Commission’s refusal to adjust the import data per

Navneet’s proposal was reasonable, supported by substantial

evidence, and otherwise in accordance with law.
Court No. 06-00401                                      Page 30

                           CONCLUSION

     For the foregoing reasons, the court sustains the findings

of the International Trade Commission.   Plaintiff’s motion for

judgment upon the agency record is denied.   Judgment shall be

entered accordingly.

                                     __/s/__Richard K. Eaton_____
                                            Richard K. Eaton

Dated:    February 26, 2008
          New York, New York