Court Opinion

ID: 817485
Source: CourtListenerOpinion
Date Created: 2013-02-01 01:52:10.862017+00
Date Added: 2024-06-11T15:37:37.875214
License: Public Domain

Slip Op. 08-61

            UNITED STATES COURT OF INTERNATIONAL TRADE
______________________________
                               :
WUHAN BEE HEALTHY CO., LTD.    :
and PRESSTEK INC.,             :
                               :
                Plaintiffs,    :
                               :
          v.                   : Before: Richard K. Eaton, Judge
                               :
UNITED STATES,                 : Court No. 05-00438
                               :
                Defendant,     :
                               :
          and                  :
                               :
THE AMERICAN HONEY             :
PRODUCERS ASSOCIATION          :
and THE SIOUX HONEY            :
ASSOCIATION,                   :
                               :
                Def.-Ints.     :
______________________________:

                             OPINION

[United States Department of Commerce’s final remand results
sustained.]

                                             Dated:   May 29, 2008

Kalik Lewin (Martin J. Lewin and Brenna Steinert Lenchak), for
plaintiffs.

Gregory A. Katsas, Acting Assistant Attorney General; Jeanne E.
Davidson, Director, Commercial Litigation Branch, Civil
Division, United States Department of Justice (Jane C. Dempsey), for
defendant.

Kelley Drye Collier Shannon (Michael J. Coursey and R. Alan
Luberda), for defendant-intervenors.

     Eaton, Judge:   In Wuhan Bee Healthy Co. v. United States, 31

CIT __, Slip Op. 07-113 (July 20, 2007) (not reported in the
Court No. 05-00438                                      Page 2

Federal Supplement) (“Wuhan”), this court sustained, in part, and

remanded, in part, the final results of the United States

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

administrative review of the antidumping duty order on imports of

honey from the People’s Republic of China (“PRC”) made between

December 1, 2002 and November 30, 2003.   See Honey from the PRC,

70 Fed. Reg. 38,873 (Dep’t of Commerce July 6, 2005) (final

results) and the accompanying Issues and Decision Memorandum

(June 27, 2005), Pub. Doc. 341 (“Issues & Dec. Mem.”)

(collectively, “Final Results”).

      Commerce has now issued remand results pursuant to the

court’s order.   See Final Results of Determination Pursuant to

Court Remand, Wuhan Bee Healthy Co., Ltd. and Presstek Inc. v.

United States, Court No. 05-00438, Slip Op. 07-113 (July 20,

2007), (Oct. 16, 2007) Pub. Doc. 3378 (“Remand Results”).

      In turn, the court has reviewed the Remand Results and the

filings in support thereof.   See Def.-Ints.’ Comments on Remand

Results; Def.’s Reply to Comments.   It is worth noting at the

outset that, although they have been afforded two opportunities

to comment on the Remand Results, plaintiffs have declined to do

so.   Jurisdiction is had pursuant to 28 U.S.C. § 1581(c) (2000)

and 19 U.S.C. § 1516a(a)(2)(B)(iii) (2000).   For the reasons

discussed below, the court sustains Commerce’s remand results.
Court No. 05-00438                                        Page 3

                             STANDARD OF REVIEW

     When reviewing a final antidumping determination from

Commerce, the court “shall hold unlawful any determination,

finding, or conclusion found . . . to be unsupported by

substantial evidence on the record, or otherwise not in

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

                              DISCUSSION

I.   Wage Rate Calculation

     The cost of labor (or wage rate) is a factor of production

used to construct normal value.    As this Court has observed,

“Commerce treats the wage rate differently from all other factors

of production[.] [F]or [the cost of] labor, Commerce employs

regression-based wage rates reflective of the observed

relationship between wages and national income in market economy

countries.”   Wuhan, 31 CIT at __, Slip Op. 07-113 at 34 (citing

Dorbest Ltd. v. United States, 30 CIT __, __, 462 F. Supp. 2d

1262, 1291 (2006)).   In Wuhan, plaintiffs challenged as

unsupported by substantial evidence Commerce’s determination with

respect to the wage rate calculation.      Plaintiffs have not

challenged the wage rate methodology itself.      After its review,

the court directed Commerce, on remand, to explain its decisions,

(1) to include data from high-wage countries in its non-market

economy (“NME”) wage rate calculation, and (2) to exclude from
Court No. 05-00438                                         Page 4

that calculation data from twenty-two low-wage countries placed

on the record by plaintiffs.     Wuhan, 31 CIT at __, Slip Op. 07-

113 at 40.   In addition, Commerce asked for a voluntary remand.

Thus, the court also instructed Commerce to recalculate the PRC

wage rate using the data set out in its remand request.      Id. at

__, Slip Op. 07-113 at 41.1

     In its Remand Results, Commerce expanded the “basket of

countries” used in the determination of NME wage rates to include

“all countries for which data are available” and which “meet the

Department’s suitability requirements.”    Remand Results at 5.

The suitability requirements include “the availability and

contemporaneity of the data, and earnings data [that] cover both

men and women and all reporting industries in the country.”         Id.

Thus, Commerce has added new data from both low-wage and high-

wage countries.   This broader data set, according to Commerce,

“better ensures accuracy and fairness” for purposes of

calculating the regression.     Id.

     For Commerce, the expansion of the data set, when combined

with an explanation of why such expansion was useful, is

sufficient to address the court’s concerns about the use of data

from high-wage countries.     The Department states that
     1
          Commerce sought a voluntary remand “with respect to the
calculation of the wage rate because it mistakenly relied upon
income data from two different years (i.e., 2001 and 2002) in its
calculation of the surrogate wage rate.” Remand Results at 24
(quotation omitted).
Court No. 05-00438                                       Page 5

“restricting the basket of countries to include only countries

that are economically comparable to each NME is not feasible and

would undermine the consistency and predictability of the

Department’s regression analysis.”    Remand Results at 16.   A

basket of “economically comparable” countries could be extremely

small, and a regression based on an extremely small basket of

countries “would be highly dependent on each and every data

point.”     Id.

             Relative basket size would not be such a
             critical factor if there were a perfect
             correlation between GNI [Gross National
             Income (“GNI”)] and wage rates. If this were
             the case, a precise regression line could be
             derived from suitable data from only two
             countries. However, as the Department has
             noted repeatedly, while there is a strong
             world-wide relationship between wage rates
             and GNI, there is nevertheless variability in
             the data. For example, in the data relied
             upon for the Department’s revised 2004
             calculation for purposes of this remand,
             observed wage rates did not increase in
             lockstep with increases in GNI in the five
             countries with GNI less than [] $1000. . . .

Remand Results at 17.    Therefore, according to Commerce, using a

larger basket of countries, including high-wage countries,

“minimizes the effects of any single data point, and thereby,

better captures the global relationship between wage rates and

GNI.”    Remand Results at 17.

        As to plaintiffs’ proposed addition of twenty-two low-wage

countries, Commerce evaluated the data from each of those
Court No. 05-00438                                             Page 6

countries against its new selection criteria, i.e., its

suitability requirements, and determined that twenty-one

countries should remain excluded from its analysis. Id. at 6.

Specifically, Commerce found that fourteen countries2 lacked

contemporaneous data for either 2001 or 2002.          Id. at 7, 7 n. 4.

Commerce excluded five countries3 because no earnings data were

available for them.       Id. at 7.     Two countries4 were excluded

because no exchange rates were available in the International

Monetary Fund’s (“IMF”) International Financial Statistics.5            Id.

at 8.       Commerce excluded Zimbabwe because it lacked GNI data for

2002, the base year.6      Id. at 9.

        Finally, pursuant to the voluntary remand, Commerce

recalculated the NME wage rates using the most current data

available, from December 2004, and corrected its erroneous

        2
          Algeria, Bangladesh, Belgium, Bolivia, Gambia, Greece,
Kenya, Kuwait, the Philippines, Portugal, Rwanda,
Saudi Arabia, Swaziland, and Venezuela.
        3
               Cambodia, Indonesia, the Netherlands, Thailand, and
Peru.
        4
               Serbia and Montenegro.
        5
          Although plaintiffs introduced exchange rate data from
The World Fact Book, the Department found it inappropriate to
deviate from its standard practice of relying on IMF data and
“cherry-pick” data from alternative sources. See Remand Results
at 8.
        6
          “The ‘Base Year’ is the year upon which the regression
data are based and is two years prior to the year in which the
Department conducts its regression analysis.” Remand Results at
6.
Court No. 05-00438                                       Page 7

calculation of the PRC wage rate based on the non-current GNI and

wage rate data for the market economies from 2001.   Id. at 28-29.

The recalculated PRC wage rate, using the revised data set,

reduced the rate from $0.93 per hour to $0.77 per hour.    See

Remand Results at 29.

      The court finds that Commerce has provided a reasonable

explanation for its Remand Results and supported those results

with substantial evidence.   First, Commerce’s explanation that

data from high-wage countries was necessary, because the

imperfect correlation between wage rates and GNI was rendered

more accurate by the inclusion of more data, appears reasonable.

Thus, Commerce’s explanation of its expansion of the data set

used to determine NME rate is consistent with the court’s remand

instruction to explain its decision to include data from high-

wage countries in its wage rate calculation.   Remand Results at

17.   Including data from high-wage countries is reasonable if the

results more accurately reflect the relationship between wage

rates and GNI under Commerce’s regression methodology.    Commerce

has represented that the inclusion of high-wage countries does

provide greater accuracy and no party has disputed this

representation.

      Second, Commerce did a thorough analysis of the data from

the twenty-two countries plaintiffs hoped to add to those used in

the regression analysis.   Commerce has thus given an adequate
Court No. 05-00438                                        Page 8

explanation for including or excluding each country’s data.    As a

result, Commerce has complied with the court’s remand instruction

to explain why it excluded twenty-one of the twenty-two

countries’ data from its calculation.

     Finally, with respect to its request for voluntary remand,

Commerce recalculated the wage rate using the correct, most

current, wage rate data.   “As long as the agency’s methodology

and procedures are reasonable means of effectuating the statutory

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.”   Shieldalloy Metallurgical

Corp. v. United States, 20 CIT 1362, 1368, 947 F. Supp. 525, 532

(1996) (quotations and citations omitted).   Commerce’s

explanation reveals its data selection on remand to be reasonable

and that it has supported its findings with substantial evidence.

See United Steel, Paper and Forestry, Rubber, Manufac., Energy,

Allied Industr. and Service Workers Int’l Union v. United States

Sec’y of Labor, 32 CIT __, __, Slip Op. 08-45, at 7 (April 30,

2008) (“A fundamental requirement of administrative law is that

an agency set forth its reasons for decision.”) (quotation and

citation omitted).   Thus, Commerce’s results regarding its wage

rate calculation are sustained.
Court No. 05-00438                                        Page 9

II.   Antidumping Duty Assessment

      The court in Wuhan also directed Commerce to provide

plaintiffs “the opportunity to submit further comments on whether

Commerce should calculate assessment and cash deposit rates on an

ad valorem basis or a per kilogram basis” and allow plaintiffs to

“place evidence on the record, should it find it necessary to do

so, specifically with respect to how an ad valorem methodology

furthers, or does not further, the collection of total duties

owed.”   Wuhan, 31 CIT at __, Slip Op. 07-113 at 55-56.    The court

further instructed Commerce to “fully explain its decision [on

remand] to use a per kilogram or ad valorem methodology by

reference to evidence placed on the record.”      Id. at _, Slip Op.

07-113 at 56.

      Pursuant to the court’s remand instruction, Commerce opened

the administrative record and sought comments on whether the

Department’s change in methodology to a per kilogram basis

ensured the proper collection of total duties due.     Remand

Results at 18.   The Department provided the parties ten days to

submit comments.     Id.   Defendant-intervenors timely submitted

comments, however, plaintiffs neither submitted any comments nor

requested an extension to the ten-day period.      Id. at 19.

      Commerce on remand determined that “it continues to be

appropriate to assess antidumping duties on a per-kilogram basis

in this case” because “the use of a per-kilogram assessment rate
Court No. 05-00438                                       Page 10

is in accordance with the Department’s regulations and past

practice, and [is] based on the evidence on the record.”     Remand

Results at 21.   Commerce “normally [ ] calculates the assessment

rate by dividing the dumping margin . . . by the entered value of

[the] merchandise for normal customs duty purposes” and applies

this ad valorem rate to the entered value of the merchandise to

calculate total antidumping duties due.    Id. at 20, 22.    In this

case, however, Commerce found that plaintiffs were reporting an

entered value of $1.05 - $1.50 per kilogram, an amount that was

approximately half of the U.S. sales price at $2.20 - $2.30 per

kilogram.   Id. at 23.   According to Commerce, such discrepancy

translated into a potential for under-collecting duties by more

than 50 percent because the ad valorem dumping margin percentage

would be applied to the lower entered value.    Id. at 23.    Because

it believed that the ad valorem method would allow plaintiffs to

avoid the total duties due, Commerce concluded that “the

application of the revised [per-kilogram] methodology will result

in the more accurate collection of duties in this case.”      Id. at

23.

      The court finds that Commerce has complied with the court’s

instructions regarding the antidumping duty assessment

methodology.   Commerce provided a ten-day comment period to all

parties and addressed the court’s concern that plaintiffs were

prejudiced by the inadequate time to fully review and comment on
Court No. 05-00438                                       Page 11

the Department’s duty assessment methodology change.    Commerce

also provided a reasonable explanation for its decision on remand

to maintain the per-kilogram rate.

       With respect to the rate itself, although Commerce normally

calculates assessment rates on an ad valorem basis, it has

discretion to revise the assessment methodology and adopt a

reasonable method for ensuring an accurate collection of total

duties due.     See Koyo Seiko Co. v. United States, 258 F.3d 1340,

1346 (Fed. Cir. 2001) quoting Torrington Co. v. United States, 44

F.3d 1572, 1578 (Fed. Cir. 1995) (“[T]he antidumping statute . .

. ‘merely requires that . . . the difference between foreign

market value and United States price serves as the basis for the

assessment rate.’”).

       Because Commerce’s method of determining the antidumping

duty assessment and cash deposit rates is reasonable and follows

the court’s remand instructions, Commerce’s remand results on

this issue are sustained.

III.   Plaintiffs’ Failure To Raise Objections To Remand Results

       Commerce revised its Final Results pursuant to the court’s

order in Wuhan and released its draft Remand Results to

interested parties for comment on September 7, 2007.    Remand

Results at 2.    Defendant-intervenors submitted comments in

support of the Department’s draft Remand Results, stating that
Court No. 05-00438                                       Page 12

the Department explained in detail why its methodology was “both

lawful and rational.”   Remand Results at 2.   Plaintiffs provided

no comments.   Remand Results at 2.    Upon the release of

Commerce’s final Remand Results, plaintiffs failed again to

provide any comments.   Under such circumstances, Commerce “may

well be entitled to assume that the silent party has decided, on

reflection, that it concurs in the agency’s [remand results],”

and the court will uphold the parties’ concurrence.     Al Tech

Specialty Steel Corp. v. United States, 29 CIT __, __, 366 F.

Supp. 2d 1236, 1245 (2005).

                          CONCLUSION

     For the reasons stated, Commerce’s Remand Results are

sustained.   Judgment shall be entered accordingly.

                                          /s/ Richard K. Eaton
                                          Richard K. Eaton

Dated:   May 29, 2008
         New York, New York