Court Opinion

ID: 818679
Source: CourtListenerOpinion
Date Created: 2013-02-03 08:27:09.882259+00
Date Added: 2024-06-11T09:02:51.400499
License: Public Domain

Slip Op. 04 - 148

 UNITED STATES COURT OF INTERNATIONAL TRADE

                                              :
HUAIYANG HONGDA DEHYDRATED                    :
VEGETABLE CO.,                                :
                                              :
                               Plaintiff,     :
                                              :
                    v.                        :            Before: MUSGRAVE, JUDGE
                                              :
UNITED STATES,                                :            Court No. 03-00636
                                              :
                               Defendant,     :
                                              :
                   and                        :
                                              :
FRESH GARLIC PRODUCERS ASS’N,                 :
CHRISTOPHER RANCH, L.L.C., FARM GATE, :
L.L.C., THE GARLIC CO., VALLEY GARLIC,        :
and VESSEY AND CO.,                           :
                                              :
                       Defendant-Intervenors. :
                                              :

[On challenge by producer/exporter to decision of U.S. Department of Commerce to rescind
administrative review of same, judgment for the defendant.]

                                                                  Decided: November 22, 2004

       deKieffer & Horgan (J. Kevin Horgan), for the plaintiff.

       Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director, Jeanne E.
Davidson, Deputy Director, Civil Division, Commercial Litigation Branch, United States
Department of Justice, (Stefan Shaibani); and Office of Chief Counsel for Import Administration,
U.S. Department of Commerce (Scott D. McBride), of counsel, for the defendant.

       Collier Shannon Scott, PLLC (Michael J. Coursey), for the defendant-intervenors.
Court No. 03-00636                                                                            Page 2

                                             OPINION

       In this action, Huaiyang Hongda Dehydrated Vegetable Company (“Hongda”), a producer

or exporter of fresh garlic from the People’s Republic of China (PRC), contends the International

Trade Administration of the U.S. Department of Commerce (“Commerce”) improperly rescinded

the annual administrative review of the antidumping order on importations of garlic from the PRC

that was initiated prior to completion of Hongda’s new shipper review. See Fresh Garlic From the

People’s Republic of China: Partial Rescission of Antidumping Duty Administrative Review, 68 Fed.

Reg. 46580 (Aug. 6, 2003). See also Antidumping Duty Order: Fresh Garlic From the People’s

Republic of China, 59 Fed. Reg. 59209 (Nov. 16, 1994). Alternatively, Hongda complains that the

376.67% country-wide dumping margin from the 1994 investigation has been discredited and

therefore its continued application to Hongda is arbitrary, capricious and otherwise not in accordance

with law. However, the Court sustains the rescission of the administrative review and concludes that

it lacks jurisdiction to hear argument on the continued viability of the 1994 country-wide margin.

                                            Background

       During the anniversary month of publication of an antidumping duty order, a domestic

interested party with respect to named exporters and producers covered by the order, and an exporter,

producer or importer with respect to subject merchandise entered during the relevant period of

review, may request Commerce to conduct an administrative review. See 19 U.S.C. § 1675(a)(1);

19 C.F.R. § 351.213(b). See also 19 U.S.C. § 1677(9) (“interested party” defined). In addition to

assessment on entries during the period of review, administrative review establishes a new cash

deposit rate on future entries of subject merchandise. See 19 U.S.C. § 1675(a)(2)(C).
Court No. 03-00636                                                                          Page 3

       The administrative record reveals that Commerce published a notice of opportunity to request

an annual administrative review of the antidumping order in the Federal Register on November 1,

2002, before the preliminary results of Hongda’s new shipper review had been completed.1 The

domestic industry petitioners then requested review of several respondents including Hongda, and

the administrative review was initiated on December 26, 2002. See R 3; R 5.2 Hongda did not at

the time submit a similar request.

       After initiation of the review, the domestic industry petitioners submitted a memorandum to

Commerce alleging that they had uncovered “massive” under-reporting of U.S. sales by Hongda and

two other respondents. See R 49 (Apr. 1, 2003); Confidential Administrative Record Document 6

(Apr. 1, 2003). The petitioners compared import statistics with information3 on the three

respondents including Hongda which accounted for “virtually” all of the imports of garlic from the

PRC during the relevant period and alleged that two and a half times the amount of garlic from the

PRC had entered the U.S. during the time as compared with what had been reported. Id. at 2. They

       1
          Cf. Antidumping or Countervailing Duty Order, Finding or Suspended Investigation:
Opportunity to Request Administrative Review, 67 Fed. Reg. 66612 (Nov. 1, 2002), Administrative
Record Document (“R”) 1 (covering the period Nov. 1, 2001 to Oct. 31, 2002); Fresh Garlic from
the People’s Republic of China: Rescission of New Shipper Antidumping Review and Initiation of
New Shipper Antidumping Duty Review, 67 Fed. Reg. 44594 (July 3, 2002) (covering the period
Nov. 1, 2001 to Apr. 30, 2002).
       2
         Initiation of Antidumping and Countervailing Duty Administrative Reviews, 67 Fed. Reg.
78772 (Dec. 26, 2002). In light of the period covered by the new shipper review, the administrative
review of Hongda would have examined Hongda shipments between May 1, 2002 and October 31,
2002.
       3
          The domestic industry’s allegation with respect to Hongda was based upon certain
information submitted at the new shipper review.
Court No. 03-00636                                                                               Page 4

therefore requested that Commerce, in consultation with the (former) U.S. Customs Service,4

investigate further and apply adverse inferences if indeed these respondents had under-reported. See

id. at 11. It appears that the petitioners, still desiring investigation, re-alleged under-reported sales

and transhipment soon thereafter. Cf. R 55 (Apr. 18, 2003) (Commerce memo to file).

        At the time, Commerce had not received Hongda’s response to the antidumping

questionnaire. On the other hand, Commerce had sent the questionnaire addressed to Hongda via

its counsel for the new shipper review. See R 7 (Dec. 30, 2002). In early April, Commerce learned

that such counsel had not been retained to represent Hongda at the administrative review. See R 56

(Apr. 22, 2003) (Commerce memo to file). It therefore sent the questionnaire directly to Hongda in

the PRC. R 57 (Apr. 23, 2003). Four days later, the domestic industry petitioners requested

rescission of the administrative review of Hongda. R 61 (Apr. 28, 2003). The petitioners did not

properly serve Hongda with a copy of this withdrawal. See Pl.’s Br., App. 7 at 2. Cf. R 61 at 5.

        Commerce did not immediately act on the domestic industry’s request. It did, however,

immediately publish the preliminary new shipper review results for Hongda the following day.

Fresh Garlic from the People's Republic of China: Preliminary Results of Antidumping Duty New

Shipper Review, 68 Fed. Reg. 22676 (Apr. 29, 2003). The results relied upon adverse facts available

to impose against Hongda the PRC-wide rate of 376.67 percent, a rate in effect since 1994 that was

based upon information contained in the petition “corroborated for the preliminary results of the first

        4
          The U.S. Customs Service was reorganized into the United States Bureau of Customs and
Border Protection pursuant to the Homeland Security Act of 2002, Pub. L. No. 107-296 § 1502, 2002
U.S.C.C.A.N. (116 Stat.) 2135, 2308, effective March 1, 2003. See Reorganization Plan
Modification for the Department of Homeland Security, H.R. Doc. No. 108-32 at 4 (2003). Matters
relating to customs fraud crimes were ultimately organized into the U.S. Bureau of Immigration and
Customs Enforcement (“BICE”). See H.R. Rep. No. 37, 108th Cong., 1st Sess. 2003.
Court No. 03-00636                                                                            Page 5

administrative review” as well as “corroborated in subsequent reviews to the extent that the

Department noted the history of corroboration[.]” Id. at 22679-80. The final new shipper review

results followed nearly two months later and reiterated the viability of the 1994 country-wide rate

for Hongda. Fresh Garlic From the People’s Republic of China: Final Results of Antidumping Duty

New Shipper Review, 68 Fed. Reg. 36767 (June 19, 2003) (“New Shipper Results”).

       A month afterwards, Hongda asserted an interest in proceeding with the instant

administrative review, which by this time was approximately eight months after initiation. On July

24, 2003, about a week after filing its notice of appearance, Hongda’s counsel met with Commerce

officials and purportedly urged continuation of the administrative review due to information that had

come to Hongda’s attention and that of certain U.S. sureties acting on behalf of certain U.S.

importers. See R 112 (July 25, 2003) (Commerce memo to file); R 107 (July 18, 2003) (notice of

appearance). Specifically, in written comments submitted on July 29, 2003, Hongda explained that

it opposed rescission of the administrative review on the ground that two fraudulent schemes

designed to evade antidumping duties on imports of Chinese agricultural products had been

uncovered and that these particularly implicated Hongda’s customs and potential antidumping duty

liabilities. R 113 (July 29, 2003). Allegedly, certain producers or exporters had been making entries

of garlic using Hongda’s name and its import bond which had been posted as security during the

pendency of the new shipper review for any ultimate antidumping duty liability. Id. See 19 C.F.R.

§ 351.214(e). Therefore, Hongda argued, continuing the administrative review afforded the

opportunity to identify legitimate and illegitimate garlic shipments, develop solutions for curtailing

the fraudulent abuse of its antidumping reviews with respect to China, and resurrect public
Court No. 03-00636                                                                           Page 6

confidence in the proper administration of Chinese agricultural imports. Id. The domestic industry,

however, urged Commerce to proceed with rescission with respect to Hongda the same day. R 115

(July 29, 2003) (Commerce memo to file).

       Commerce immediately reported Hongda’s allegations of import fraud to the “Chief of the

Other Government Agency Branch” of Customs and Border Protection. R 120 (Aug. 1, 2003).

Nonetheless, Commerce rescinded the administrative review of Hongda shortly thereafter. Fresh

Garlic From the People’s Republic of China: Partial Rescission of Antidumping Duty Administrative

Review, 68 Fed. Reg. 46580 (Aug. 6, 2003). The public notice of Commerce’s determination stated

that rescission of the administrative review was appropriate because customs fraud is within the

“statutory purview” of the Bureau of Immigration and Customs Enforcement rather than Commerce,

that the domestic industry petitioners had withdrawn their request, that Commerce had not expended

significant resources on the review to date, and that Hongda itself had not properly requested the

administrative review or had otherwise participated in it until recently. One day later, Commerce

extended the deadline for the preliminary administrative review results of the remaining respondents

until October 31, 2003. See Fresh Garlic From the People’s Republic of China: Notice of Extension

of Time Limit for the Preliminary Results of Antidumping Duty Administrative and New Shipper

Reviews, 68 Fed. Reg. 47020 (Aug. 7, 2003). This action followed.

                              Jurisdiction and Standard of Review

       Jurisdiction is alleged pursuant to 19 U.S.C. § 1516a(a)(2)(B)(iii) and 28 U.S.C. § 1581(c).

A decision by the administering authority to rescind a particular administrative review must be

supported by substantial evidence and be in accordance with law. See 19 U.S.C. § 1516a(b)(1)(B)(i).
Court No. 03-00636                                                                              Page 7

                                              Discussion

        Monthly over the past twenty years, Commerce has published the outstanding orders with

anniversary dates for the particular month. The practice amounts to clear notification to all potential

interested parties of the opportunity to request an administrative review, as well as indication of

Commerce’s preference to have all parties interested in proceeding with administrative review

submit a written request for same in response to the published notice. See Ferro Union, Inc. v.

United States, 23 CIT 178, 182, 44 F.Supp.2d 1310, 1316 (1999) (discussing Potassium

Permanganate from the People’s Republic of China, 59 Fed. Reg. 46035 (Sep. 6, 1994)). Once a

request for administrative review is submitted, it may be withdrawn, and the administrative review

rescinded, within 90 days of the published notice of opportunity, although Commerce “may extend

this time limit if the Secretary decides that it is reasonable to do so.” 19 C.F.R. § 351.213(d)(1). Cf.

Fuyao Glass Indus. Group Co. v. United States, 27 CIT ___, Slip Op. 03-99 at 7 (July 31, 2003),

(during first 90 days the party requesting administrative review controls whether review is to

proceed, if no other party also requests review) with Sugiyama Chain Co. v. United States, 18 CIT

423, 430, 852 F. Supp. 1103, 1110 (1994), aff’d 60 F.3d 843 (Fed. Cir. 1995) (Commerce has the

discretion to accept or reject an interested party’s withdrawal of its request for an administrative

review pursuant to 19 U.S.C. § 1675(a)(1)). The dispute here concerns this latter provision.

                                                   I

        Approximately eight months after initiation of the administrative review it was rescinded

because Commerce had “not committed significant resources to date” and the “petitioners were the

only party to request an administrative review” of Hongda. 68 Fed. Reg. at 46581. Hongda had not
Court No. 03-00636                                                                           Page 8

complied with the formality of responding to the published notice of opportunity, but at this stage

it argues that Commerce’s decision was unreasonable when considered against the following: (1) it

was not until April 23, 2003, that Commerce finally sent its questionnaire directly to Hongda; (2)

the questionnaire was untranslated and no Hongda personnel are fluent in English; (3) Hongda did

not at the time have legal counsel for the administrative review; (4) five days after Commerce

properly sent the questionnaire to Hongda in the PRC (April 28, 2003), the domestic industry

petitioners withdrew their request for administrative review, which was 123 days after the notice of

initiation was published (i.e., the day before Commerce published the preliminary new shipper

review results); and (5) after Hongda retained counsel on July 18, 2003, counsel immediately

contacted Commerce and met with Commerce officials on July 24, 2003 and declared Hongda’s

willingness to fully participate in the administrative review. Hongda further argues that Commerce’s

decision was unreasonable since it ignored the alleged import fraud which bears on the magnitude

of Hongda’s antidumping duty liability. Pl.’s Br. at 7-8.

       Most of Hongda’s points appear directed toward argument that it had inadequate notice of

the administrative review. The Court is sympathetic, but the position is ultimately untenable, for

several reasons. First, Hongda requested and participated in a new shipper review, which, like an

administrative review, is conducted pursuant to section 751 of the Tariff Act of 1930, as amended.

19 U.S.C. § 1675. Cf. 19 C.F.R. §§ 351.214(b) & 351.221(c). Initiation of either type of review is

dependant upon knowledge of the anniversary date of the order. See 19 C.F.R. §§ 351.213(b),

351.214(d), 351.221(c)(1). Having thus participated in a new shipper review, Hongda cannot

persuasively disclaim imputed knowledge of Commerce’s administrative review policies and
Court No. 03-00636                                                                              Page 9

procedures. Furthermore, prior involvement in antidumping duty proceedings concerning the same

subject merchandise gives rise, a fortiori, to an interest in monitoring for publication of the annual

notice of opportunity to request review. Cf. Fed. Crop Ins. Corp. v. Merrill, 332 U.S. 380, 385, 68

S.Ct. 1, 3 (1947) (promulgated regulations were binding on all who sought to come within the

Federal Crop Insurance Act regardless of actual knowledge of the regulations or “the hardship

resulting from innocent ignorance”).

       Second, as a general matter, publication in the Federal Register “is sufficient to give notice

of the contents of the document to a person subject to or affected by it.” 44 U.S.C. § 1507. See, e.g.,

Lyng v. Payne, 476 U.S. 926, 942-43, 106 S.Ct. 2333 (1986); Stearn v. Dep’t of the Navy, 280 F.3d

1376, 1384 (Fed. Cir. 2002); Aris Gloves, Inc. v. United States, 281 F.2d 954 (CCPA 1958), cert.

denied, 82 S.Ct. 398, 368 U.S. 954 (1962); Cathedral Candle Co. v. U.S. Intern. Trade Com’n, 27

CIT __ n.10, 285 F.Supp.2d 1371 n.10 (2003). While it may be true that constructive notice in the

Federal Register of a hearing or opportunity to be heard is geographically explicit only “to all

persons residing within the States of the Union and the District of Columbia”5 and also that there

may also be instances where notice by publication is insufficient as a matter of law, “[t]he purpose

of the Federal Register Act was to give notice to industry, to general business, or to the people of the

country as a whole, of certain action taken by the President under a power granted to him by the

Congress, so that such industry, business or the people might have notice of such action and act

accordingly.” Aris Gloves, 281 F.2d at 957-958 (quoting Toledo, P. & W.R.R. v. Stover, 60 F.Supp.

587, 596 (N.D. Ill. 1945)). All industries or businesses availed of the “substantial privilege” of doing

       5
           See 44 U.S.C. § 1508.
Court No. 03-00636                                                                            Page 10

business within the United States are chargeable with knowledge of its laws and the manner of their

execution to maintain public order. Cf. Exxon Corp. v. Wisconsin Dep’t of Revenue, 447 U.S. 207,

100 S.Ct. 2109 (1980) (taxation nexus); Pensacola Telegraph Co. v. Western Union Telegraph Co.,

96 U.S. 1, 6 Otto 1 (1877) (national privilege is quid pro quo for acceptance of national terms).

       Third, even imperfect notice does not, necessarily, void agency action undertaken pursuant

thereto. See Brock v. Pierce County, 476 U.S. 253, 106 S.Ct. 1834 (1986); Intercargo Ins. Co. v.

United States, 83 F.3d 391, 396 (Fed. Cir. 1996); Kemira Fibres Oy v. United States, 61 F.3d 866

(Fed. Cir. 1995). The question, essentially, is whether a plaintiff has been substantially prejudiced

by the imperfect notice. E.g., Intercargo. One may, in fact, be apprized of circumstances amounting

to actual or implied notice of the matter invoked by the agency. See United States v. Elof Hansson,

Inc., 296 F.2d 779, 48 CCPA 91 (1960); Hoenig Plywood Corp. v. United States, 51 Cust. Ct. 336,

RD 10569 (1963). Here, it is undisputed that counsel, while representing Hongda at the new shipper

review, received the original administrative review questionnaire that Commerce intended to serve

upon Hongda. If the transmission of that questionnaire by Commerce to counsel was erroneous, it

is understandable. Counsel apparently continued to appear on the service list maintained by the

Central Records Unit. See 19 C.F.R. § 351.103(c). See, e.g., R 3. Counsel did not alert Commerce

to the “error” at the time. It took a further three months and Commerce’s initiative to discover that

counsel’s representation of Hongda did not, at least at the time, extend to the administrative review

proceeding. And during that time, counsel’s silence furthered the impression that they represented

Hongda in successive segments of the administration of the dumping order.

       Counsel do not comment further on the document’s disposition, but assuming receipt of the

questionnaire elicited counsel’s surprise, they had three choices: return it, forward it, or ignore it.
Court No. 03-00636                                                                              Page 11

The ABA Model Rules of Professional Conduct do not specifically require counsel to forward or

disclose receipt of arguendo extraneous matter to a client, but neither do they suggest ignoring it.6

Whether counsel had a duty to notify the client of the existence of the questionnaire (or, for that

matter, to notify Commerce) depended not upon whether the questionnaire pertained to a matter

within the scope of the representation, but rather upon whether silence had the potential to bring

about “substantial prejudice” to Hongda. If it was not a matter within the scope of representation,

then ignoring it might serve a tactical purpose, e.g. subsequently being able to claim improper notice

and thereby defeating jurisdiction. In accordance with the foregoing, however, that would at best

have been an open question at the time, and the Model Rules, in keeping with the Model Code,

essentially advise “when in doubt, confer.” Truly, the exercise of that discretion ultimately rests with

counsel, but to the extent Commerce considered that counsel’s receipt of the administrative review

questionnaire without apparent further activity mitigated in favor of finding constructive or implied

notice in Hongda,7 such consideration was not an abuse of discretion.

        6
           Model Rule 1.4 of the ABA Model Rules of Professional Conduct, for example, implores
counsel to “keep the client reasonably informed about the status of a matter” and “explain a matter
to the extent reasonably necessary to permit the client to make informed decisions regarding the
representation[,]” id. at (a)(3) & (b), and Model Rule 1.2(c) allows counsel to “limit the objectives
of the representation if the client consents after consultation.” Similarly, under the ABA Model
Code of Professional Responsibility, Canon 6 spoke on providing competent representation to the
client. Counsel aspired, pursuant to EC 6-4, to “safeguard the interests of a client,” but are obligated,
pursuant to DR 6-101(A)(3), not to neglect a legal matter “entrusted” to them. EC 7-7 reiterated that
it is the client who is responsible for making decisions but entitled counsel to make decisions “not
affecting the merits of the cause or substantially prejudicing the rights of a client.” DR 7-101(A)(3)
admonished counsel not to intentionally “prejudice or damage the client during the course of the
professional relationship.”
        7
          On the subject of notice, Hongda also complains that the domestic industry did not properly
serve it with a copy of their request to withdraw their administrative review request. The point does
                                                                                        (continued...)
Court No. 03-00636                                                                            Page 12

        Nor was it an abuse of discretion for Commerce to conclude that Hongda’s opposition to

rescission and its belated expression of interest in the completion of the administrative review were

not on par with a proper written request for administrative review. Hongda’s silence subsequent to

the review’s initiation cannot reasonably be construed as reliance upon the request of another as an

expression of interest that the administrative review be conducted. Even if it could, such reliance

places one at a disadvantage in arguing that an administrative review should continue if the other

withdraws its request, as this matter demonstrates. The record is devoid of any (other) indicia of

detrimental reliance, and the Court must defer to Commerce’s reasonable policy of having each

interested party desiring initiation of an administrative review submit a separate written request to

that effect.

        Commerce might well have wondered why it was suddenly confronting tactical volte face by

both parties late in the proceeding. In the final analysis, what appears to have tipped the balance for

Commerce was the fact that Hongda had, apparently, been dilatory in asserting its interests. At this

stage, even considering the matter in a light most favorable to Hongda, fifty-five days had elapsed

between the time Commerce sent the questionnaire to Hongda directly and the time that it finally

retained legal counsel to represent it at the administrative review proceeding. Hongda does not here

adequately explain why it took nearly two months to initiate contact with Commerce to declare that

it wanted to “fully participate.” Instead, Hongda offers for consideration Ferro Union, supra, 23 CIT

        7
          (...continued)
not address the impression that Hongda did not properly request or otherwise participate in the
administrative review when the opportunity to do so presented itself, nor does it demonstrate
substantial prejudice to Hongda since Commerce did not, as above observed, immediately act upon
the domestic industry’s request but waited a further 55 days before deciding to rescind during which
time Hongda had the opportunity to fully express its opposition to recision to Commerce.
Court No. 03-00636                                                                           Page 13

178, 44 F.Supp.2d 1310, which stated that “the legislative history of 19 U.S.C. 1675(a) indicates that

Congress intended to limit reviews in which no one had an interest, and Commerce should rightly

continue a review in which there is an expressed interest.” Pl.’s Br at 8 (quoting 23 CIT at 181, 44

F.Supp.2d at 1315). Hongda also draws attention to the statement that in administrative reviews

“involving multiple parties, Commerce has only granted termination when no other party objected

to the termination.” Id. (quoting 23 CIT at 182, 44 F.Supp.2d at 1316).

       It is worthwhile for this Court to agree, even emphasize again, that “Commerce should rightly

continue a review in which there is an expressed interest,” but the matter here is not considered

pursuant to a de novo standard of review. Ferro Union imposes no limitation on Commerce’s

consideration of a withdrawal of interest in an administrative review by the interested party which

requested it. Rather, the case sustained Commerce’s decision to reject an attempt by the domestic

steel industry to terminate that administrative review, and the reference in Ferro Union to reviews

“involving multiple parties” addresses the situation of multiple properly-submitted written requests

for administrative review. That is not the situation here, which is rather analogous to Potassium

Permanganate from the People’s Republic of China, supra, 59 Fed. Reg. 46035. As in that matter,

also described in Ferro Union, Commerce has rescinded an administrative review over the objection

of a respondent which has not filed its own request for administrative review. See 23 CIT at 182,

44 F.Supp.2d at 1316. Commerce’s decision to rescind administrative review of Hongda is therefore

not without precedent.

       Lastly, Hongda takes issue with Commerce’s determination to rescind despite the fact that

“Hongda and several importers expressed concerns pertaining to the rescission of the administrative

review of Hongda[.]” That, to say the least, is an understatement: the determination to rescind was
Court No. 03-00636                                                                             Page 14

predicated in part on reasoning that “the arguments they presented [in opposition to recision] pertain

to allegations involving fraud.” 68 Fed. Reg. at 46581.

        The government concurs that the Bureau of Immigration and Customs Enforcement, not

Commerce, is statutorily assigned the task of investigating customs fraud. See 19 U.S.C. § 1592.

Hongda pleads that the very assertion of fraud rendered the decision unreasonable. Specifically,

Hongda argues that “[i]t is in the public’s best interest to investigate this claim prior to ordering

recision[,]” that as a matter of fundamental fairness it “should be allowed to participate in the review

so that [Commerce] could accurately calculate any potential dumping margin”, and that the mere

assertion of fraud and Hongda’s expression on interest in fully participating in the administrative

review rebutted any presumption that rescission with respect to Hongda would be reasonable.8

However, Hongda does not show how the alleged fraud affected the margin that was applied to it.

In fact, there is no connection (see infra).

        To the extent that the government’s rationale implies that import fraud is irrelevant to an

administrative review, such a position is unacceptable, due to the potential for skewed review results.

Nevertheless, Commerce’s position here appears to be that import fraud per se is not, without more,

a sufficient reason to require that an administrative review proceed in the face of withdrawal of

interest in the review by the sole party that properly requested it. Thus, Commerce essentially

reasoned that whether the public interest is served by the investigation of customs fraud, proceeding

with an administrative review in the first place depends upon an interested party’s timely expression

of its interest in it. In this matter, Commerce simply concluded that Hongda’s expression of interest

        8
            Pl.’s Br. at 7-8. Hongda also notes that the Federal Register notice did not accurately
reflect its willingness to fully participate in the administrative review.
Court No. 03-00636                                                                          Page 15

in the administrative review was belated. On this basis, unfortunately for Hongda, the Court is

constrained to conclude that Commerce’s consideration of the opposing arguments and its decision

to rescind was not an abuse of discretion since it appears to have substantial supporting evidence on

the administrative record. There may be instances where actual participation amounts to such a

sufficient expression of interest in completing the administrative review that its recision would be

unlawful, but this is not one of them.

                                                 II

       Whether Hongda’s allegation of customs fraud is true, its position has not been worsened as

a result of the recision of the administrative review. The margin that continued to be applicable as

a result of recision, i.e., the new shipper review results, was not determined despite assertion of

customs fraud. Nonetheless, Hongda argues that the country-wide margin that was applied to it was

not lawfully “determined” since it is merely the country-wide rate from the 1994 investigation. The

country-wide rate, Hongda emphasizes, was obtained from the petition and was not corroborated.

       Commerce is authorized to rely on “facts otherwise available” in making its determinations

if it cannot obtain the information directly. It may also derive an adverse inference if a party has

been uncooperative.     But, whenever Commerce uses “secondary information” rather than

information “obtained” in a review, it is required “to the extent practicable” to corroborate that

information. Information from a prior segment of an antidumping proceeding is considered

secondary information. See generally 19 U.S.C. § 1677e.

       Commerce interprets the corroboration requirement to mean that secondary information must

have “probative value.” See Statement of Administrative Action at 870; Antidumping Duties;

Countervailing Duties, 62 Fed Reg. 27296, 27409 (1997). Thus, on this matter Hongda argues the
Court No. 03-00636                                                                         Page 16

administrative record contains no indicia of corroboration of secondary information, no memoranda

evincing any discussions thereon. In the final analysis, Hongda argues, Commerce did not articulate

any reasoning in the recision notice to explain why the country-wide rate continues to be probative.

         However, as the government points out, the only action taken by Commerce that is being

challenged is the decision to rescind the review itself with respect to Hongda. Commerce made no

decision on the merits. Commerce did not “decide” to apply facts available. See 19 U.S.C. §

1677e(a). The recision of the administrative review merely continued the margin that was already

in effect. Accordingly, there was no determination to use a “facts available” figure that would have

otherwise required corroboration. The Court therefore concludes that it lacks jurisdiction over

Hongda’s claim. Any lack of corroboration in the determination to apply the country-wide figure

to Hongda was properly appealable from publication of New Shipper Results, supra, 68 Fed. Reg.

36767.

                                            Conclusion

         For the foregoing reasons, judgment will enter in favor of the defendant.

                                                    /s/ R. Kenton Musgrave
                                                        R. KENTON MUSGRAVE, JUDGE

Dated: November 22, 2004
       New York, New York
                                            ERRATA

Huaiyang Hongda Dehydrated Vegetable Co. v. United States, Court No. 03-00636, Slip Op. 04-
148, dated November 22, 2004:

       Footnote 4, delete “ (“BICE”) ”.

       Page 5, line 21, delete “its”.

       Footnote 7, second to last line, change “55” to “100”.

       Page 12, line 14, change “fifty-five” to “86".

       Page 12, line 17, change “two” to “three”.

November 30, 2004