Court Opinion

ID: 9353480
Source: CourtListenerOpinion
Date Created: 2023-01-11 23:01:27.573641+00
Date Added: 2024-06-11T17:07:16.512774
License: Public Domain

Slip Op. 23-

              UNITED STATES COURT OF INTERNATIONAL TRADE

 HYUNDAI ELECTRIC & ENERGY
 SYSTEMS CO., LTD.,

                   Plaintiff,

              v.

 UNITED STATES,
                                            Before: Mark A. Barnett, Chief Judge
                                            Court No. 20-00108
                   Defendant,

              and

 HITACHI ENERGY USA INC. AND
 PROLEC-GE WAUKESHA, INC.,

           Defendant-Intervenors.

                                      OPINION

[Sustaining the U.S. Department of Commerce’s second remand results in the sixth
administrative review of the antidumping duty order on large power transformers from
the Republic of Korea.]

                                                              Dated: -DQXDU\

Ron Kendler, White & Case LLP, of Washington, DC, argued for Plaintiff. With him on
the brief were David E. Bond and William J. Moran.

Kelly Krystyniak, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, of Washington, DC, argued for Defendant. With her on the brief
were Brian M. Boynton, Principal Deputy Assistant Attorney General, Patricia M.
McCarthy, Director, and L. Misha Preheim, Assistant Director. Of counsel on the brief
was Ian A. McInerney, Attorney, Office of the Chief Counsel for Trade Enforcement and
Compliance, U.S. Department of Commerce, of Washington, DC.

Melissa M. Brewer, Kelley Drye & Warren LLP, of Washington, DC, argued for
Defendant-Intervenors. With her on the brief were R. Alan Luberda and David C. Smith.
Court No. 20-00108                                                                Page 2

      Barnett, Chief Judge: This matter is before the court following the U.S.

Department of Commerce’s (“Commerce” or “the agency”) second redetermination upon

remand. See Final Results of Redetermination Pursuant to Ct. Remand (“Second

Remand Results”), ECF No. 106-1; see generally Hyundai Elec. & Energy Sys. Co. v.

United States (“HEES II”), 46 CIT __, 578 F. Supp. 3d 1245 (2022); Confid. Final

Results of Redetermination Pursuant to Ct. Remand (“First Remand Results”), ECF No.

55-1. Commerce prepared the Second Remand Results in connection with the sixth

administrative review of the antidumping duty order on large power transformers

(“LPT(s)”) from the Republic of Korea (“Korea”) for the period of review August 1, 2017,

to July 31, 2018 (“the POR”). Large Power Transformers From the Republic of Korea,

85 Fed. Reg. 21,827 (Dep’t Commerce Apr. 20, 2020) (final results of antidumping

admin. review; 2017-2018) (“Final Results”), ECF No. 24-4, and accompanying Issues

and Decision Mem., A-580-867 (Apr. 14, 2020) (“I&D Mem.”), ECF No. 24-5. 1 The

court’s opinion in HEES II presents background information on this case, familiarity with

which is presumed.

      Plaintiff Hyundai Electric & Energy Systems Co., Ltd. (“HEES”) commenced this

case challenging several aspects of the Final Results. See Confid. Compl., ECF No.

13; Summons, ECF No. 1. HEES moved to supplement the administrative record with

1 The administrative record for the Second Remand Results is divided into a
Confidential Remand Record (“CRR”), ECF No. 107-2, and a Public Remand Record
(“PRR”), ECF No. 107-3. The parties submitted joint appendices containing record
documents cited in their briefs. See Confid. J.A., ECF No. 115; Public J.A., ECF No.
116. The court references the confidential record documents, unless otherwise
specified.
Court No. 20-00108                                                                 Page 3

two additional documents relating to Commerce’s finding that a particular LPT was

produced in Korea, rather than the United States, which the court granted. See

Hyundai Elec. & Energy Sys. Co. v. United States, 44 CIT __, 477 F. Supp. 3d 1324

(2020). Defendant United States (“the Government” or “Defendant”) then requested a

remand of the Final Results to address these two additional documents, which the court

also granted. See Hyundai Elec. & Energy Sys. Co. v. United States, Slip Op. 20-160,

2020 WL 6559158 (CIT Nov. 9, 2020).

      On June 30, 2021, Commerce filed its First Remand Results. HEES moved for

judgment on the agency record, challenging Commerce’s determinations that HEES

(1) failed to submit service-related revenue documentation, (2) incorrectly reported

certain contested part(s) as non-scope merchandise, and (3) failed to report a U.S. sale

of an LPT. See Confid. Am. Mem. of P. & A. in Supp. of Pl.’s Rule 56.2 Mot. for J. Upon

the Agency R. at 1–4, ECF No. 88. HEES contended that these determinations were

not supported by substantial evidence and that substantial evidence did not support the

agency’s application of adverse facts available (“AFA”) and total AFA. 2 See id.

      On May 10, 2022, the court remanded the First Remand Results. HEES II, 578

F. Supp. 3d at 1263. Relevant to this discussion, the court ordered Commerce to

2 While the phrase “total AFA” is not referenced in either the statute or the agency's
regulations, it can be understood, within the context of this case, to refer to Commerce’s
application of the “facts otherwise available” and “adverse inference” provisions of 19
U.S.C. § 1677e after finding that it could not accurately calculate a dumping margin with
the information submitted by respondents in this review and could not fill in the gaps in
information without undue difficulty. See Mukand Ltd. v. United States, 767 F.3d 1300,
1308 (Fed. Cir. 2014).
Court No. 20-00108                                                                 Page 4

reconsider or further explain its determinations to “use facts available with respect to

HEES’s reporting of the contested part(s)” and “rely on total adverse facts available to

determine HEES’s [dumping] margin.” Id. In the Second Remand Results, Commerce

found that there was not “a sufficient basis on the record to determine that [HEES]

misclassified [the contested parts]” and, thus, HEES’s reporting of these parts was not

so incomplete “such that it contribute[d] to Commerce’s determination to apply total AFA

to [HEES].” Second Remand Results at 8. However, Commerce continued to apply

total AFA based on HEES’s failure to correctly report service-related revenue and its

failure of the completeness test at verification. Id. at 9–13.

       HEES filed comments opposing the Second Remand Results. See Confid. Pl.’s

Cmts. in Opp’n to the Final Results of Redetermination Pursuant to Ct. Remand (“Pl.’s

Opp’n Cmts.”), ECF No. 109. Defendant and Defendant-Intervenors, Hitachi Energy

USA Inc. and Prolec-GE Waukesha, Inc. (together, “Defendant-Intervenors”), filed

comments urging the court to sustain the Second Remand Results. See Confid. Def.’s

Resp. to Cmts. on Remand Redetermination (“Def.’s Resp. Cmts.”), ECF No. 111; Def.-

Ints.’ Cmts. in Supp. of [Second Remand Results] (“Def.-Ints.’ Cmts. in Supp.”), ECF

No. 113. 3 The court heard oral argument on December 7, 2022. Docket Entry, ECF

No. 119.

3 HEES also submitted comments in support of the Second Remand Results with
respect to Commerce’s determination that HEES’s reporting of certain contested parts
and components did not warrant the application of AFA. See Pl.’s Responsive Cmts. in
Supp. of the [Second Remand Results] (“Pl.’s Cmts. in Supp.”), ECF No. 114.
Court No. 20-00108                                                                   Page 5

                         JURISDICTION AND STANDARD OF REVIEW

       The court has jurisdiction pursuant to section 516A(a)(2)(B)(iii) of the Tariff Act of

1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2018), 4 and 28 U.S.C. § 1581(c).

The court will uphold an agency determination that is supported by substantial evidence

and otherwise in accordance with law. 19 U.S.C. § 1516a(b)(1)(B)(i).

                                        DISCUSSION

       When “necessary information is not available on the record,” or an interested

party “withholds information” requested by Commerce, “fails to provide” requested

information by the submission deadlines, “significantly impedes a proceeding,” or

provides information that cannot be verified pursuant to 19 U.S.C. § 1677m(i),

Commerce “shall . . . use the facts otherwise available.” Id. § 1677e(a). Once

Commerce determines that the use of facts otherwise available is warranted, if

Commerce also “finds that an interested party has failed to cooperate by not acting to

the best of its ability to comply with a request for information,” Commerce “may use an

inference that is adverse to the interests of that party in selecting from among the facts

otherwise available.” Id. § 1677e(b). “Compliance with the ‘best of its ability’ standard

is determined by assessing whether a respondent has put forth its maximum effort to

provide Commerce with full and complete answers to all inquiries in an investigation.”

Nippon Steel Corp. v. United States, 337 F.3d 1373, 1382 (Fed. Cir. 2003); see also

Essar Steel Ltd. v. United States, 678 F.3d 1268, 1275–76 (Fed. Cir. 2012).

4All citations to the Tariff Act of 1930, as amended, are to Title 19 of the U.S. Code,
and references to the U.S. Code are to the 2018 edition unless otherwise stated.
Court No. 20-00108                                                                       Page 6

       Commerce uses total adverse facts available to determine dumping margins

when “none of the reported data is reliable or usable.” Zhejiang DunAn Hetian Metal

Co. v. United States, 652 F.3d 1333, 1348 (Fed. Cir. 2011) (citation omitted); see also

Nat’l Nail Corp. v. United States, 43 CIT __, __, 390 F. Supp. 3d 1356, 1374 (2019)

(explaining that “Commerce uses ‘total adverse facts available’” when it applies

“adverse facts available not only to the facts pertaining to specific sales or

information . . . not present on the record, but to the facts respecting all of respondents’

production and sales information that the [agency] concludes is needed for an

investigation or review”) (citation omitted). “[U]se of partial facts available is not

appropriate when the missing information is core to the antidumping analysis and

leaves little room for the substitution of partial facts without undue difficulty.” Mukand,

767 F.3d at 1308.

      I.   Substantial Evidence Supports Commerce’s Determination that HEES’s
           Reporting of Parts and Components Does Not Warrant Application of
           AFA

       In HEES II, the court found that Commerce failed to establish that HEES

incorrectly reported certain contested parts and remanded to Commerce to “reconsider

or further explain whether HEES failed to properly report the contested part(s).” 578 F.

Supp. 3d at 1259. In its remand determination, Commerce concluded that it did “not

have a sufficient basis on the record to determine that [HEES] misclassified [the] parts

in question” and, thus, that the reporting of these parts was not a basis for applying total

AFA to HEES. Second Remand Results at 8. No parties contest Commerce’s

determination on this issue. See Def.’s Resp. Cmts. at 4; Pl.’s Cmts. in Supp. at 1–2;
Court No. 20-00108                                                                Page 7

Def.-Ints.’ Cmts. in Supp. at 2. Commerce explained the basis for its determination on

this issue and that determination complies with the court’s remand order. Accordingly,

the court will sustain Commerce’s determination on this issue.

     II.   Commerce’s Use of Total AFA

              A. Background

      In HEES II, the court sustained Commerce’s use of AFA with respect to HEES’s

failure to report service-related revenue, 578 F. Supp. 3d at 1256, and with respect to

HEES’s completeness failure at verification, id. at 1263. However, the court remanded

the Final Results for Commerce to reconsider or further explain its determination to use

facts available with respect to HEES’s reporting of certain contested parts. Id. at 1259.

Because the remanded issue was one of three bases, in combination, for Commerce’s

decision to use total AFA, the court deferred ruling on whether substantial evidence

supported Commerce’s use of total AFA. Id.

      On remand, Commerce found that there was not a sufficient record basis to

determine that HEES misclassified the contested parts. Second Remand Results at 8.

However, Commerce found that HEES’s deficient reporting of service-related revenue

and failure of the completeness test at verification, together, warranted the continued

application of total AFA. Id. at 9. Commerce found that it was unable to calculate an

accurate dumping margin without a complete U.S. sales database and service-related

revenue documentation. Id.

      Commerce explained that, based on the record, it was unable to determine

whether the unreported service-related revenue was included in, or excluded from, the
Court No. 20-00108                                                                Page 8

reported gross unit prices. Id. at 10. Commerce was thus “unable to identify

corresponding service-related expenses to implement [the agency’s] normal capping

policy,” calculate “an accurate export price,” or “calculate an accurate dumping margin.”

Id. at 10; see also id. at 17–18.

       HEES’s failure to properly report service-related revenue arose based on the

company’s decision to prepare its questionnaire responses and sales databases in the

same manner as prior administrative reviews, notwithstanding its repeated

acknowledgement that its relationship with Hyundai Corporation USA (“Hyundai USA”)

had materially changed. HEES II, 578 F. Supp. 3d at 1251–52. Specifically, HEES

reported that it was no longer affiliated with Hyundai USA because of ownership

changes in the company that left HEES with less than five percent ownership of

Hyundai USA. Id. at 1252. Despite no longer being affiliated, HEES represented that it

would continue to treat Hyundai USA as an affiliate for reporting purposes because

there were other bases upon which the agency might find affiliation. Id. at 1251–52; see

also 19 U.S.C. § 1677(33) (defining “affiliated persons”). Because HEES reported its

U.S. sales database as if it remained affiliated with Hyundai USA, it did not provide

Commerce with certain service-related revenue documentation, particularly between

HEES and Hyundai USA, which Commerce discovered at verification. 5 HEES II, 578 F.

Supp. 3d at 1253. In HEES II, the court found that substantial evidence supported

5HEES reported its U.S. sales on a constructed export price basis, and not an export
price basis, and thus did not include service-related revenue documentation between it
and Hyundai USA, claiming that this documentation was “intercompany, internal
communications.” See HEES II, 578 F. Supp. 3d at 1252–53 (quoting I&D Mem. At 13).
Court No. 20-00108                                                                  Page 9

Commerce’s use of AFA with respect to service-related revenue because HEES

withheld this documentation that related to every U.S. sale, id. at 1253, despite

acknowledging that the two companies were no longer affiliated and, to that end, HEES

failed to cooperate to the best of its ability in responding to Commerce’s requests for

information. Id. at 1256.

       On remand, Commerce also explained that HEES’s failure to report the U.S. sale

of an LPT that Commerce determined was made in Korea impeded the agency’s ability

to accurately calculate a dumping margin. Second Remand Results at 11–13.

Specifically, Commerce found that the omission of this sale “could lead to a significantly

inaccurate calculation of the weighted-average dumping margin for [HEES].” Id. at 12;

see also id. at 18–20.

               B. Parties’ Contentions

       HEES contends that Commerce’s application of total AFA is not supported by

substantial evidence and is contrary to law. Pl.’s Opp’n Cmts. at 3. HEES contends

that the omission of service-related revenue documentation is limited to a discrete

category of information and “is [not] so pervasive as to justify disregarding” other data

and documents that were correctly reported and verified. Id. at 5. HEES also contends

that Commerce has not adequately explained why total AFA is justified with respect to

this omission because, in a past review of this antidumping order, Commerce applied

only partial AFA with respect to missing service-related revenue information. Id. at 4.

Finally, HEES contends that the omission of a single LPT sale does not undermine the
Court No. 20-00108                                                                 Page 10

entirety of its U.S. sales reporting or suggest a pattern of unresponsiveness. Id. at 6–

12.

       Defendant and Defendant-Intervenors contend that Commerce’s determination to

apply total AFA is supported by substantial evidence and in accordance with law. Def.’s

Resp. Cmts. at 5; Def.-Int’s Cmts. at 2.

               C. Substantial Evidence Supports Commerce’s Use of Total AFA

       When relying on total adverse facts available, Commerce must “examine the

record and articulate a satisfactory explanation for its action.” Yangzhou Bestpak Gifts

& Crafts Co. v. United States, 716 F.3d 1370, 1378 (Fed. Cir. 2013). “[U]se of partial

[adverse] facts available is not appropriate when the missing information is core to the

antidumping analysis and leaves little room for the substitution of partial facts without

undue difficulty.” Mukand, 767 F.3d at 1308.

       Here, Commerce based its determination to use total AFA on both HEES’s failure

to report service-related revenue for its U.S. sales transactions and its failure of the

completeness test at verification. Second Remand Results at 13, 21. HEES attempts

to disaggregate these issues by arguing that, in analogous past cases, Commerce

determined to use partial AFA where a party failed to provide certain service-related

revenue documentation or failed to report a single sale. See Pl.’s Opp’n Cmts. at 4, 7–

8. The court, however, having sustained Commerce’s determination to apply AFA with

respect to each of these issues, must determine whether the use of total AFA based on

these reporting failures in combination is supported by substantial evidence. The court

concludes that substantial evidence supports Commerce’s determination.
Court No. 20-00108                                                               Page 11

       Looking first at HEES’s failure to report service-related revenue and withhold

relevant documentation, Commerce explained that the absence of this information

made it impossible to apply its “capping methodology” for U.S. sales transactions. 6

Second Remand Results at 10. Commerce explained that it could not “reasonably

calculate an accurate dumping margin” because it could not properly “cap” service-

related revenue due to the “incomplete and unreliable information” provided by HEES

and the absence of record information showing whether the service-related revenue

was excluded from or included in the reported gross U.S. price. Id. at 11. Thus, the

agency determined that total AFA was warranted. Id.

       HEES first argues that Commerce has not justified its use of total AFA here

because Commerce previously applied partial AFA in the second administrative review

of the antidumping order on LPTs for failure to accurately report service-related

revenue. See Pl.’s Opp’n Cmts. at 4–5; see also ABB Inc. v. United States, 44 CIT __,

__, 437 F. Supp. 3d 1289, 1300–1301 (2020) (sustaining Commerce’s application of

6 Pursuant to 19 U.S.C. § 1677a(c)(2), Commerce is required to reduce the price used
to establish the export price or constructed export price by “the amount, if any, included
in such price, attributable to any additional costs, charges, or expenses . . . which are
incident to bringing the subject merchandise from the original place of shipment in the
exporting country to the place of delivery in the United States.” Commerce offsets any
such service-related expenses with related service-related revenues, capping those
revenues at the level of the associated expenses. See ABB, Inc. v. United States, 41
CIT __, __, 273 F. Supp. 3d 1200, 1208 (2017). The court has upheld Commerce’s
practicing of “capping” service-related revenue by the associated service-related
expenses. See id.
Court No. 20-00108                                                               Page 12

partial AFA where respondents did not accurately report service-related revenue). 7

Contrary to HEES’s argument, Commerce has adequately explained why it is treating

HEES’s failure to provide service-related revenue differently than it did in the second

administrative review.

      In the second administrative review, Commerce received service-related revenue

and expense information and the agency used this information to cap service-related

revenues by service-related expenses. See ABB Inc., 437 F. Supp. at 1300 & n.17. In

this review, HEES chose to report its sales on a constructed export price basis despite

repeatedly acknowledging that HEES and Hyundai USA were no longer affiliated. See

HEES II, 578 F. Supp. 3d at 1251–53. As a result, HEES did not provide any usable

service-related revenue information and failed to explain whether such revenue was

already excluded from the U.S. price, thereby “imped[ing] Commerce’s ability to

calculate an accurate U.S. price for every sale reported in the U.S. sales database.”

Second Remand Results at 18. Furthermore, in the second administrative review,

Commerce only used AFA with respect to HEES’s service-related revenue information.

See ABB Inc., 437 F. Supp. 3d at 1294–95. Here, however, Commerce also found that

7 Commerce’s use of partial AFA for failure to accurately report service-related revenue
in the second administrative review was subsequently vacated by the U.S. Court of
Appeals for the Federal Circuit. Hitachi Energy USA Inc. v. United States, 34 F.4th
1375, 1386 (Fed. Cir. 2022), as modified by Hitachi Energy USA Inc. v. United States,
2022 WL 17175134 (Fed. Cir. Nov. 23, 2022) (limiting the court’s ruling to the
circumstances of that case). However, this ruling related to Commerce’s failure to
provide parties with an opportunity to correct reporting deficiencies pursuant to 19
U.S.C. § 1677m(d), and not the distinction between use of partial and total AFA. See id.
at 1385–86.
Court No. 20-00108                                                                Page 13

the use of AFA was warranted with respect to HEES’s failure to report all U.S. sales.

See Second Remand Results at 17, 19–21.

       HEES also argues that the service-related revenue information it failed to provide

was “limited to a discrete category of information.” Pl.’s Opp’n Cmts. at 6 (emphasis

omitted); see also id. at 5–6. However, as Commerce explained, reporting of service-

related revenue was core to its analysis. See Second Remand Results at 10–11, 17–

18. Complete and accurate U.S. sales prices are a fundamental aspect of a dumping

calculation. See Mukand, 767 F.3d at 1307 (sustaining Commerce’s use of total AFA

for failure to accurately report cost information and tacitly agreeing with agency’s

statement that reporting of sales and cost data was “one of the most basic and

significant requirements in performing [a] dumping analysis and margin calculation”).

Here, service-related revenue information was vital to Commerce’s ability to cap

service-related revenue, calculate accurate export prices, and ultimately calculate an

accurate dumping margin. See Second Remand Results at 10–11, 17–18. Thus,

HEES’s failure to report service-related revenue was not limited to a discrete category

of information but was instead “vitally interconnected with other elements of the

dumping determination.” See Mukand, Ltd. v. United States, 37 CIT 443, 453 (2013).

       HEES also contends that the omission of a single sale from the U.S. sales

database is insufficient to justify the use of total AFA. See Pl.’s Opp’n Cmts. at 6–12.

HEES contends that Commerce’s application of total AFA based on a single omission is

inconsistent with both Commerce’s practice and the court’s precedent, id. at 7–8, and

record evidence does not support Commerce’s claim that the omission of one sale will
Court No. 20-00108                                                                Page 14

cause a significant inaccuracy in the calculation of the dumping margin, see id. at 8. 8

These arguments are unconvincing.

       HEES again fails to appreciate that Commerce did not base its determination to

use total AFA on only the omission of one sale—HEES’s failure to provide service-

related revenue documentation between it and Hyundai USA also contributed to

Commerce’s finding that total AFA was justified. 9 Second Remand Results at 13, 21.

Likewise, HEES fails to appreciate the factual difference between instances in which a

single omitted sale makes up a small percentage of overall sales, and instances, such

as here, in which the omitted sale makes up a more significant percentage of sales,

both in total volume and total value. See id. at 12 (“Given the value of this omitted U.S.

sale compared to the total value of the reported U.S. sales transactions and given the

difference of gross unit price among U.S. sales transactions, we find that omission of

8 HEES contends that Commerce’s claimed inability to establish the completeness of
the U.S. sales database is not supported by substantial evidence because Commerce
fully reconciled HEES’s U.S. sales database. Pl.’s Opp’n Cmts. at 10–12. This
argument is nothing more than an attempt to relitigate an issue which the court decided
in HEES II. In evaluating whether substantial evidence supported Commerce’s decision
that the unreported U.S. sale was manufactured in Korea, the court noted that
Commerce’s reconciliation of HEES’s U.S. sales database was a point in favor of
HEES’s contention that the LPT in question was produced in the United States. HEES
II, 578 F. Supp. 3d at 1262. However, the court ultimately determined that substantial
evidence supported Commerce’s determination that the LPT was not produced in the
United States, but, instead, in Korea. Id. Once Commerce’s finding that the LPT in
question was produced in Korea is accepted, the fact that this sale avoided detection
undermined Commerce’s faith in the value of its completeness test for HEES’s U.S.
sales. See Second Remand Results at 19.
9 While HEES does also argue that the combination of its reporting failures does not

justify use of total AFA, see Pl.’s Opp’n Cmts. at 12, this argument is just a restatement
of its arguments that each issue by itself does not merit use of total AFA.
Court No. 20-00108                                                                  Page 15

this U.S. sale . . . could lead to a significantly inaccurate calculation of the weighted-

average dumping margin for [HEES].”). 10

       As Commerce explained, the relationship between the price of a single U.S. LPT

sale to the prices of other U.S. LPT sales made during the POR “does not indicate the

impact that the [single] sale [would] have on the margin calculation” because “[t]he

timing and matching of the sale, sales adjustments, and Commerce’s capping

methodology, as well as the gross unit price together,” could lead to a disproportionate

impact on the dumping margin. Id. at 19. In other words, Commerce found no reason

to assume that the omitted sale was dumped at the same level as another similarly

priced U.S. sale because the dumping margin depends not simply on the price of the

10  The court is not persuaded by HEES’s contention that Commerce merely speculated
that the missing sale would dramatically affect the calculation of the final dumping
margin. See Pl.’s Opp’n Cmts. at 8. Commerce stated that because the number of
U.S. sales made during the POR was low, “the failure to report even a single sale may
dramatically affect the final margin calculation.” Second Remand Results at 18
(emphasis added); see also id. at 12 (“[O]mission of this U.S. sale . . . could lead to a
significantly inaccurate calculation of the weighted-average dumping margin for
[HEES]”) (emphasis added). While HEES emphasizes Commerce’s choice of the words
“may” and “could” to support its position that Commerce merely speculated about the
effect of the omitted sale, see Pl.’s Opp’n Cmts. at 8, there is no dispute that the omitted
sale would have at least some impact on the final dumping margin, see Pl.’s Opp’n
Cmts. at 8–9 (arguing only that the omitted sale would not significantly alter the
dumping margin); Second Remand Results at 13. That omitted sale “call[ed] into
question” more than just the accuracy of HEES’s sale ledger, because HEES was
unable to produce documentation that it told Commerce existed for all U.S. sales.
Second Remand Results at 20. Although Commerce’s choice of words is phrased as
conjecture about the impact of the omitted sale on the dumping margin, it is reasonable
to conclude that even one omitted sale might substantially affect the final dumping
margin when there are only a small number of sales made during the POR. Moreover,
it is not reasonable to require Commerce to quantify the impact of the omitted sale when
quantifying it would require Commerce to gather, review, confirm, and verify information
that HEES failed to provide in the first instance.
Court No. 20-00108                                                                  Page 16

U.S. sale, but the differential between that price and its normal value—and the relevant

normal value may differ based upon the timing of the U.S. sale and the physical

characteristics of that sale. See Wheatland Tube Co. v. United States, 161 F.3d 1365,

1369–70 (Fed. Cir. 1998) (“An explicit explanation is not necessary, however, where the

agency’s decisional path is reasonably discernible.”).

       The prior decisions upon which HEES relies to support its contention that a

single omitted sale does not justify total AFA are inapposite. Plaintiff cites Fujian

Machinery and Equipment Import & Export Corp. v. United States, 27 CIT 1059, 276 F.

Supp. 2d 1371 (2003), for the proposition that “total AFA based on the respondent’s

failure to report a single sale was a form of ‘impermissible bootstrapping’ and that this

single error did not justify the conclusion that the entirety of the respondent’s data were

unreliable.” Pl.’s Opp’n Cmts. at 7. Plaintiff fails to understand, however, that the

antidumping duty order at issue there, involving heavy forged hand tools, covered four

classes of merchandise and the court expressly affirmed Commerce’s application of

total AFA with respect to the class of merchandise in which the unreported sale

occurred. Fujian, 27 CIT at 1060, 276 F. Supp. 2d at 1373. The court then addressed

whether Commerce could extrapolate from the recognized failure with respect to one

class to the other three classes of merchandise, and found that Commerce could not so

do, without more. Id. at 1061, 276 F. Supp. 2d at 1374. The court expressly noted that

“numerous ‘oversights’ would likely suggest a ‘pattern of unresponsiveness’ justifying

not only the application of facts available . . ., but of AFA,” id. at 1061 n.2, 276 F. Supp.

2d at 1374 n.2, and ultimately sustained Commerce’s use of total AFA for all four
Court No. 20-00108                                                               Page 17

classes of merchandise based on additional reporting and verification failures, see id. at

1062–65, 276 F. Supp. 2d at 1375–77.

      The agency determinations cited by HEES also do not support its argument that

Commerce’s practice is to apply partial facts available when there is a single missing

sale. See Pl.’s Opp’n Cmts. at 7 (citing Issues and Decision Mem. for Certain New

Pneumatic Off-the-Road Tires From China (“China ORT Mem.”), A-570-912, (Apr. 8,

2015), https://access.trade.gov/Resources/frn/summary/prc/2015-08673-1.pdf (last

visited Jan. 11, 2023; 11 Issues and Decision Mem. for Tissue Paper From China (“China

TP Mem.”), A-570-894, (Oct. 9, 2007),

https://access.trade.gov/Resources/frn/summary/prc/E7-20349-1.pdf (last visited Jan.

11, 2023)). 12 While Commerce did not directly address these determinations,

Commerce effectively distinguished these cases when, as discussed above, the agency

responded to HEES’s core argument that failure to report a single U.S. sale does not

undermine its reporting. Commerce explained that, here, there were so few U.S. sales

made during the POR that even a single unreported sale could affect the calculation of

11 In the China ORT Memorandum, Commerce applied partial AFA when a respondent
failed to report all sales for an entire control number. China ORT Mem. at 32–35.
However, in that proceeding, upon discovery of the omission of sales at verification, the
respondent provided the information requested by Commerce and Commerce verified
that information. China ORT Mem. at 34 (noting that although the agency did not
accept the invoices provided at verification as part of the record, it reviewed the
information on the invoices to ensure the veracity of the information on a summary
sheet of sales that was part of the record). Here, as noted above, HEES was unable to
provide the documentation it claimed existed for all U.S. sales. Second Remand
Results at 20.
12 In that proceeding Commerce applied partial AFA with respect to a missing sale and

a “discount on U.S. sales found at verification.” China TP Mem. at 33.
Court No. 20-00108                                                               Page 18

the dumping margin such that total AFA was merited. See Second Remand Results at

18. While the exact quantity of missing sales is not discussed in either of the cited

determinations, HEES has not shown that Commerce was bound to use partial AFA in

this case simply because it did so in the cited determinations.

                                       CONCLUSION

       Based on the foregoing, the court will sustain Commerce’s Final Results as

amended by the Second Remand Results. Judgment will enter accordingly.

                                                 /s/   Mark A. Barnett
                                                 Mark A. Barnett, Chief Judge

Dated: -DQXDU\
      New York, New York