Court Opinion

ID: 820109
Source: CourtListenerOpinion
Date Created: 2013-02-10 19:36:14.263377+00
Date Added: 2024-06-11T15:37:41.644697
License: Public Domain

Slip Op. 12 - 100

           UNITED STATES COURT OF INTERNATIONAL TRADE

GROBEST & I-MEI INDUSTRIAL
(VIETNAM) CO., LTD., et al.,

         Plaintiffs,

           v.                         Before: Donald C. Pogue,
                                              Chief Judge
UNITED STATES,
                                      Consol. Court No. 10-002381
         Defendant,

AD HOC SHRIMP TRADE ACTION
COMMITTEE, et al.,

         Defendant-Intervenors.

                         OPINION AND ORDER

[Affirming, in part, and remanding, in part, the Department of
Commerce’s Final Results of Redetermination Pursuant to Remand]

                                             Dated: July 31, 2012

          Matthew R. Nicely, David S. Christy, Jr., and David J.
Townsend, Thompson Hine LLP, of Washington, DC, for the
Plaintiffs Grobest & I-Mei Industrial (Vietnam) Co., Ltd.; Bac
Lieu Fisheries Joint Stock Co.; C.P. Vietnam Livestock Corp.; Ca
Mau Seafood Joint Stock Co.; Cadovimex Seafood Import-Export and
Processing Joint-Stock Co.; Cafatex Fishery Joint Stock Corp.;
Camau Frozen Seafood Processing Import Export Corp.; Cantho
Import Export Fishery Ltd. Co.; Cuulong Seaproducts Co.; Danang
Seaproducts Import Export Corp.; Investment Commerce Fisheries
Corp.; Minh Hai Export Frozen Seafood Processing Joint-Stock Co.;
Minh Hai Joint-Stock Seafoods Processing Co.; Minh Phat Seafood
Co., Ltd.; Minh Phu Seafood Corp.; Minh Qui Seafood Co., Ltd.;
Ngoc Sinh Private Enterprise; Nha Trang Fisheries Joint Stock
Co.; Nha Trang Seaproduct Co.; Phu Cuong Seafood Processing &
Import-Export Co., Ltd; Phuong Nam Co. Ltd.; Sao Ta Foods Joint
Stock Co.; Soc Trang Seafood Joint Stock Co.; Thuan Phuoc
Seafoods and Trading Corp.; UTXI Aquatic Products Processing

     1
       This action is consolidated with Court Nos. 10-00253, 10-
00257, 10-00265, 10-00272, and 10-00273. Order, Oct. 21, 2010,
ECF No. 24.
Consol. Court No. 10-00238                                  Page 2

Corp.; Viet Foods Co., Ltd.

          Robert G. Gosselink and Jonathan M. Freed, Trade
Pacific PLLC, of Washington, DC, for the Consolidated Plaintiffs
Cam Ranh Seafoods Processing Enterprise Co.; Contessa Premium
Foods Inc.; H&N Foods International.

          Adams C. Lee, Walter J. Spak, and Jay C. Campbell,
White & Case, LLP, of Washington, DC, for the Consolidated
Plaintiff Amanda Foods (Vietnam) Ltd.

          Joshua E. Kurland, Trial Attorney, Commercial
Litigation Branch, Civil Division, U.S. Department of Justice, of
Washington, DC, for Defendant United States. With him on the
briefs were Stuart F. Delery, Acting Assistant Attorney General,
Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant
Director. Of counsel on the briefs was Jonathan Zielinski,
Senior Attorney, Office of the Chief Counsel for Import
Administration, U.S. Department of Commerce, of Washington, DC.

           Andrew W. Kentz, Jordan C. Kahn, Nathaniel M. Rickard,
and Kevin M. O’Connor, Picard Kentz & Rowe LLP, of Washington,
DC, for Defendant-Intervenor Ad Hoc Shrimp Trade Action
Committee.

          Geert M. De Prest and Elizabeth J. Drake, Stewart &
Stewart, of Washington, DC, and Edward T. Hayes, Leake &
Andersson, LLP, of New Orleans, LA, for the Defendant-Intervenor
American Shrimp Processors Association.

          Pogue, Chief Judge: This case returns to court

following remand, by Grobest & I-Mei Indus. (Vietnam) Co. v.

United States, 36 CIT   , 815 F. Supp. 2d 1342 (2012) (“Grobest

I”), of the final results of the fourth administrative review of

the antidumping duty order on certain frozen warmwater shrimp

from the Socialist Republic of Vietnam.2   Specifically, Grobest I

     2
       Certain Frozen Warmwater Shrimp from the Socialist
Republic of Vietnam, 75 Fed. Reg. 47,771 (Dep’t Commerce Aug. 9,
2010) (final results and partial rescission of antidumping duty
administrative review) (“Final Results”), and accompanying Issues
                                             (footnote continued)
Consol. Court No. 10-00238                                   Page 3

remanded the Final Results for the Department of Commerce

(“Commerce” or “the Department”) to (1) provide further

explanation or reconsider its policy of zeroing in administrative

reviews but not in investigations consistent with recent case law

from the Court of Appeals for the Federal Circuit; (2) reconsider

the request of Plaintiff Grobest & I-Mei Industrial (Vietnam)

Co., Ltd. (“Grobest”) for individual review as a voluntary

respondent consistent with 19 U.S.C. § 1677m(a); and (3) accept

Amanda Foods’ separate-rate certification and reconsider Amanda

Foods’ duty rate. Grobest I, 36 CIT at    , 815 F. Supp. 2d at

1367–68.   Upon remand, in the Final Results of Redetermination

Pursuant to Remand, A-552-802, ARP 08–09 (Apr. 30, 2012), Remand

R. Pub. Doc. 6 (“Remand Results”), Commerce (1) provided further

explanation to support its zeroing policy; (2) declined to

individually review Grobest as a voluntary respondent because

such review would be unduly burdensome and inhibit the timely

completion of the review; and (3) accepted Amanda Foods’

separate-rate certificate and assigned it the separate rate of

3.92%.   Plaintiffs challenge the first and second determinations

in the Remand Results.   For the reasons discussed below, the

court affirms the Remand Results on the first and third

     2
      (footnote continued)
& Decision Memorandum, A-552-802, ARP 08–09 (July 30, 2010),
Admin. R. Pub. Doc. 233, available at
http://ia.ita.doc.gov/frn/summary/VIETNAM/2010-19577-1.pdf (“I &
D Mem.”) (adopted in Final Results, 75 Fed. Reg. at 47,772).
Consol. Court No. 10-00238                                        Page 4

determinations, but remands again on the second.

              The court has jurisdiction pursuant to

§ 516A(a)(2)(B)(iii) of the Tariff Act of 1930,3 codified, as

amended, at 19 U.S.C. § 1516a(a)(2)(B)(iii) (2006) and 28 U.S.C.

§ 1581(c) (2006).

                           STANDARD OF REVIEW

              “The court will sustain the Department’s determination

upon remand if it complies with the court’s remand order, is

supported by substantial evidence on the record, and is otherwise

in accordance with law.” Jinan Yipin Corp. v. United States, 33

CIT       , 637 F. Supp. 2d 1183, 1185 (2009) (citing 19 U.S.C.

§ 1516a(b)(1)(B)(i)).

                                           4
                              DISCUSSION

I.    Commerce’s Policy of Zeroing in Administrative Reviews but
      Not in Investigations

      A.      Background

              In Grobest I, Plaintiffs challenged Commerce’s policy

of employing zeroing in administrative reviews but not in

      3
       All further citations to the Tariff Act of 1930, as
amended, are to Title 19 of the U.S. Code, 2006 edition.
      4
        Because Commerce’s assignment of a separate rate to
Amanda Foods is consistent with the remand order and is
unchallenged, the court will affirm this determination without
further discussion.
Consol. Court No. 10-00238                                    Page 5

investigations.5   The court remanded the Final Results to

Commerce for reconsideration and redetermination consistent with

the Court of Appeals’ holdings in Dongbu Steel Co. v. United

States, 635 F.3d 1363 (Fed. Cir. 2011) and JTEKT Corp. v. United

States, 642 F.3d 1378 (Fed. Cir. 2011). Grobest I, 36 CIT at      ,

815 F. Supp. 2d at 1350.   In Dongbu, the Court of Appeals held

that “the government has not pointed to any basis in the statute

for reading 19 U.S.C. § 1677(35) differently in administrative

reviews than in investigations. . . . In the absence of

sufficient reasons for interpreting the same statutory provision

inconsistently, Commerce’s action is arbitrary.” Dongbu, 635 F.3d

at 1372–73.   In JTEKT, Commerce attempted to comply with Dongbu

by pointing out that different methodologies are employed in

investigations and reviews.   The Court of Appeals rejected

Commerce’s explanation as insufficient, stating:

     While Commerce did point to differences between
     investigations and administrative reviews, it failed to
     address the relevant question — why is it a reasonable
     interpretation of the statute to zero in administrative
     reviews, but not in investigations? It is not
     illuminating to the continued practice of zeroing to
     know that one phase uses average-to-average comparisons
     while the other uses average-to-transaction
     comparisons.

     5
       Familiarity with the court’s prior opinion and the history
of the zeroing dispute outlined therein are presumed. For
further discussion of the zeroing dispute and a detailed
explanation of the zeroing methodology, see the recent decision
in Union Steel v. United States, 36 CIT   , 823 F. Supp. 2d 1346
(2012).
Consol. Court No. 10-00238                                      Page 6

JTEKT, 642 F.3d at 1384.    The issue now before the court is

whether Commerce’s further explanation, as provided in the Remand

Results, is sufficient to satisfy the Court of Appeals’ concerns

in Dongbu and JTEKT.

     B.     Analysis

            In the Remand Results, Commerce puts forward three

arguments to support its use of zeroing in reviews but not in

investigations.    First, Commerce argues that the courts have

previously affirmed the reasonableness of Commerce’s current

review and investigation methodologies.    Second, Commerce argues

that the change of methodology in investigations was a reasonable

implementation of an adverse World Trade Organization (“WTO”)

decision.    Finally, Commerce argues that its inconsistent

interpretations reasonably account for inherent differences

between investigations and reviews.

            Commerce contends that its first and second arguments

“sufficiently justify and explain why the Department reasonably

interpreted section [1677(35)] differently in average-to-average

comparisons in antidumping duty investigations relative to all

other contexts.” Remand Results at 11.    However, contrary to

Commerce’s assertion, in Dongbu the Court of Appeals held both of

these arguments insufficient to justify the inconsistent

interpretations.

            The Court of Appeals made clear in Dongbu that the
Consol. Court No. 10-00238                                     Page 7

question before it — and therefore currently before this court —

was novel:   “Although we have considered Commerce’s zeroing

policy in administrative reviews on numerous occasions . . . we

agree with [plaintiff] that this court has never addressed the

reasonableness of Commerce’s interpretation of 19 U.S.C.

§ 1677(35) with respect to administrative reviews now that

Commerce is no longer using a consistent interpretation.” Dongbu,

635 F.3d at 1371 (citations omitted); see also Union Steel, 36

CIT at   , 823 F. Supp. 2d at 1355–56.    While the Court of

Appeals has repeatedly affirmed the use of zeroing in

administrative reviews, see, e.g., Timken Co. v. United States,

354 F.3d 1334, 1341–45 (Fed. Cir. 2004), and approved Commerce’s

decision to cease zeroing in investigations, see U.S. Steel Corp.

v. United States, 621 F.3d 1351, 1360–63 (Fed. Cir. 2010), it has

not addressed the question of inconsistent interpretations in

prior cases.   Therefore, that the Court of Appeals has “upheld

the reasonableness of Commerce’s changed methodology does not

necessarily lead to the conclusion that Commerce’s use of zeroing

in administrative reviews remains reasonable.” Dongbu, 635 F.3d

at 1372 (responding to the claim that U.S. Steel Corp. stands for

the proposition that the Court of Appeals has endorsed Commerce’s

divergent interpretations).   Commerce cannot now rely on prior

endorsements of its methodology when those cases did not address

the relevant question before the court.
Consol. Court No. 10-00238                                      Page 8

            Nor does Commerce’s proper implementation of an adverse

WTO ruling resolve the question.    Rather, recognizing that the

Court of Appeals has upheld the new investigation methodology as

a reasonable implementation of an adverse WTO ruling, U.S. Steel,

621 F.3d at 1360–63, Commerce must now show that its decision

“compl[ies] with domestic law including reasonably interpreting

statutes.” Dongbu, 635 F.3d at 1372.    A proper and reasonable

implementation of an adverse WTO ruling may be contrary to law if

it leads to an unreasonably inconsistent interpretation of

statutory language. Id. (“[T]he government’s decision to

implement an adverse WTO report standing alone does not provide

sufficient justification for the inconsistent statutory

interpretations.”).    While implementation of an adverse WTO

ruling may be a partial justification, it is not sufficient to

resolve the matter. Union Steel, 36 CIT at     , 823 F. Supp. 2d at

1357–58.

            Therefore, the court turns to Commerce’s third

argument, that the Department’s interpretations of 19 U.S.C.

§ 1677(35) account for inherent differences between

investigations and reviews.    Commerce supports this argument in

two ways.    First, Commerce provides a detailed explanation of the

methodological differences between the average-to-average

comparison in investigations and the average-to-transaction

approach taken in administrative reviews.    Second, Commerce
Consol. Court No. 10-00238                                    Page 9
explains why the goal of the investigation differs from the goal

of the administrative review.   Plaintiffs argue that this

reasoning does not satisfy the Court of Appeals’ concerns in

Dongbu and JTEKT because it is not tied to the language of the

statute. Comments on Final Results of Redetermination Pursuant to

Court Remand at 7–9, ECF No. 116 (“Pls.’ Comments”).

          When considering whether Commerce’s interpretation is

reasonable, the court looks first, but not exclusively, to the

language of the statute. See Chevron U.S.A., Inc. v. Natural Res.

Def. Council, Inc., 467 U.S. 837, 843 n.9 (1984); see also

Wheatland Tube Co. v. United States, 495 F.3d 1355, 1361 (Fed.

Cir. 2007) (“To determine whether Commerce’s interpretation . . .

is reasonable, we may look to ‘the express terms of the

provisions at issue, the objectives of those provisions, and the

objectives of the antidumping scheme as a whole.’” (quoting NSK

Ltd. v. United States, 26 CIT 650, 654, 217 F. Supp. 2d 1291,

1297 (2002))).   But, as the court pointed out in Union Steel,

this issue cannot be decided solely on the basis of the statutory

language found at § 1677(35)(A). Union Steel, 36 CIT at      , 823

F. Supp. 2d at 1356–57.   The statutory language (the word

“exceeds” in particular) has been repeatedly held ambiguous;

furthermore, it has been held to reasonably accommodate an

interpretation consistent with both zeroing and offsetting

methodologies.   Compare Timken, 354 F.3d at 1341–45, with U.S.
Consol. Court No. 10-00238                                   Page 10
Steel, 621 F.3d at 1360–63.   What is at issue is not simply

whether Commerce takes two different interpretations of

§ 1677(35)(A) in reviews and investigations; what is at issue is

whether the statute can accommodate two different means to

achieve two different ends.   Stated differently: is it reasonable

under the statutory scheme as a whole for Commerce to employ a

methodology incorporating zeroing in reviews but not in

investigations?

          To begin answering this question, we note that the

statute distinguishes between “the amount by which normal value

exceeds the export price or constructed export price,” i.e., the

dumping margin, and the manner in which this margin becomes the

basis for the antidumping duty.   Section 1677(35)(A) defines a

dumping margin as “the amount by which the normal value exceeds

the export price or constructed export price of the subject

merchandise.”   Pursuant to 19 U.S.C. § 1673, if Commerce finds

sales of subject merchandise at less than fair value and the

International Trade Commission finds injury, then “there shall be

imposed upon such merchandise an antidumping duty . . . in an

amount equal to the amount by which the normal value exceeds the

export price (or constructed export price) for the merchandise.”

Though a “dumping margin” and an “antidumping duty” are both

measures of how much the normal value exceeds the export or

constructed export price, § 1673 does not conflate the
Consol. Court No. 10-00238                                   Page 11
antidumping duty with the dumping margin.   Rather, § 1673

contemplates a calculation methodology for arriving at the

antidumping duty when it makes that duty “an amount equal to the

amount by which normal value exceeds export price” (emphasis

added).

          However, the process by which a dumping margin becomes

an antidumping duty is not provided by statute. See U.S. Steel,

621 F.3d at 1360.   What the statute does provide is the basis for

an antidumping duty.   In some instances, the statute simply

requires that the antidumping duty be based on the amount by

which normal value exceeds export price. See 19 U.S.C. §§ 1673,

1673e(c)(3) (“[Commerce] shall publish notice in the Federal

Register of the results of its determination of normal value and

export price (or the constructed export price), and that

determination shall be the basis for the assessment of

antidumping duties . . . .”), 1675(a)(2)(C) (“The determination

under this paragraph[6] shall be the basis for the assessment of

. . . antidumping duties . . . and for deposits of estimated

duties.”).7   In other instances, the statute requires that an

     6
       The referenced determination is found in 19 U.S.C.
§ 1675(a)(2)(A): “For the purpose of paragraph (1)(B), [Commerce]
shall determine (i) the normal value and export price (or
constructed export price) of each entry of the subject
merchandise, and (ii) the dumping margin for each such entry.”
     7
       Two prior opinions of this Court have discussed the
definition of dumping margin as it appears in 19 U.S.C.
                                             (footnote continued)
Consol. Court No. 10-00238                                   Page 12
estimated antidumping duty be based on the weighted average

dumping margin, which, in turn, is based on the dumping margin,

see § 1677(35), also known as the amount by which normal value

exceeds export price.   See 19 U.S.C. § 1673b(d)(1)(B) (requiring

security in an amount based on the weighted average dumping

margin calculated for the preliminary determination); 19 U.S.C.

§ 1673d(c)(1)(B)(ii) (requiring security in an amount based on

the weighted average dumping margin calculated for the final

determination).   Thus, pursuant to statute, Commerce must

calculate the amount by which the normal value exceeds the export

price, i.e., the dumping margin, and this margin becomes the

basis for the antidumping duty.

          Prescribing that the dumping margin be the basis of the

antidumping duty does not tell Commerce how to translate a

dumping margin into an antidumping duty.   Commerce has reasonably

     7
      (footnote continued)
§ 1675(a)(2)(A). See Union Steel, 36 CIT at   , 823 F. Supp. 2d
at 1357 (“‘[D]umping margin’ is itself a very general term that
sometimes means ‘dumping margin’ as a comparison and sometimes
actually means ‘weighted-average dumping margin’ as a percentage
. . . .”); KYD, Inc. v. United States, 35 CIT   , 779 F. Supp. 2d
1361, 1368-69 (2011) (“‘The term “dumping margin” means the
amount by which the normal value exceeds the export price or
constructed export price of the subject merchandise.’ 19 U.S.C.
§ 1677(35)(A) (emphasis added)”); Kyd, at 1370 n.8. While these
two opinions may, perhaps, be read to interpret § 1675(a)(2)(A)
slightly differently, any such conflict is irrelevant to the
zeroing issue. As discussed elsewhere in this opinion, it is the
process by which a dumping margin becomes a dumping duty that is
relevant and neither Union Steel nor Kyd is in conflict with the
other or with this opinion on this issue.
Consol. Court No. 10-00238                                   Page 13
interpreted the various provisions to involve a three-step

calculation: (1) calculation of a dumping margin; (2) calculation

of a weighted average dumping margin; and (3) application of the

weighted average dumping margin to sales or entries to determine

the cash deposit or antidumping duty.8 See Union Steel, 36 CIT

at   , 823 F. Supp. 2d at 1349–50, app.   Therefore, the

§ 1677(35)(A) dumping margin serves as the basis for a

§ 1677(35)(B) weighted average dumping margin, and the weighted

average dumping margin serves as the basis for the antidumping

duty or estimated antidumping duty.9

          Where, then, does zeroing come into the calculation

methodology?   As the Court of Appeals has held, the statute

     8
       The Court of Appeals noted in Koyo Seiko Co. v. United
States, 258 F.3d 1340, 1342 (Fed. Cir. 2001), that “Commerce has
adopted two different calculational approaches — one for cash
deposits and one for final duties.” However, the difference in
the approaches is that “the formula for cash deposit rates uses
sales during the review period as the denominator; the formula
for the final duty uses imports as the denominator.” Id. at 1343.
The formulas, however, are the same in form and bear the same
relation to the dumping margin and weighted average dumping
margin.
     9
       In this regard, it is worth noting that neither normal
value nor export price are constant values. Both fluctuate over
the periods of review or investigation and also vary within the
various forms of the subject merchandise. Consequently, for
these pricing values to result in a manageable assessment rate,
Commerce must further treat the data. Such considerations lend
further support to the necessity of Commerce developing a
methodology for translating dumping margins into antidumping
duties and give lie to the notion that a § 1677(35)(A) dumping
margin is a sufficient basis upon which to assess an antidumping
duty.
Consol. Court No. 10-00238                                   Page 14
neither requires nor forbids it at any step in the process. U.S.

Steel, 621 F.3d at 1361 (“[Section] 1677(35)(A) does not

unambiguously preclude — or require — Commerce to use zeroing

methodology.”).   Commerce explains in the Remand Results:

     When using an average-to-average comparison
     methodology, the Department usually divides the export
     transactions into groups, by model and level of trade
     (averaging groups), and compares an average export
     price or constructed export price of transactions
     within one averaging group to an average normal value
     for the comparable model of the foreign like product at
     the same or most similar level of trade. . . . The
     Department then compares the average export price or
     constructed export price for the averaging group with
     the average normal value for the comparable
     merchandise. This comparison yields an average amount
     of dumping for the particular averaging group because
     the high and low prices within the group have been
     averaged together prior to the comparison.
     Importantly, under this comparison methodology, the
     Department does not calculate the extent to which an
     exporter or producer dumped a particular sale . . . but
     rather makes the determination “on average” for the
     averaging group within which higher prices and lower
     prices offset each other. The Department then
     aggregates the results from each of the averaging
     groups to determine the aggregate dumping margins for a
     specific producer or exporter. At this aggregation
     stage, negative averaging group comparison results
     offset positive averaging group comparison
     results. . . .
               . . . Under the average-to-transaction
     comparison methodology, the Department compares the
     export price or constructed export price for a
     particular U.S. transaction with the average normal
     value for the comparable model of foreign like product.
     . . . The result of such a comparison evinces the
     amount, if any, by which the exporter or producer sold
     the merchandise at an export price less than its normal
     value. The Department then aggregates the results of
     these comparisons — i.e., the amount of dumping found
     for each individual sale — to calculate the weighted-
     average dumping margin for the period of review. To
     the extent the average normal value does not exceed the
Consol. Court No. 10-00238                                 Page 15
     individual export price or constructed export price of
     a particular U.S. sale, the Department does not
     calculate a dumping margin for that sale or include an
     amount of dumping for that sale in its aggregation of
     transaction-specific dumping margins.

Remand Results at 12–14.

          Pursuant to both methodologies, Commerce calculates the

§ 1677(35)(A) dumping margin by subtracting the export price from

normal value for each averaging group.   Once a dumping margin has

been established, Commerce aggregates these dumping margins to

determine a weighted average dumping margin.   In an

investigation, Commerce aggregates all of the dumping margins to

determine “overall pricing behavior.” Remand Results at 14.     In a

review, Commerce zeros negative margins prior to aggregation to

arrive at a more accurate margin and to uncover masked dumping.

Id. at 7, 14.   Thus, “Commerce is not reading ‘exceeds’ to mean

two things.   It is reading it as basically irrelevant to the

calculation methodology, whether it expresses its view in that

manner or not.” Union Steel, 36 CIT at    , 823 F. Supp. 2d at

1357.

          Rather than reading “exceeds” in § 1677(35)(A)

inconsistently, Commerce adopts two different methodologies for

translating the dumping margin into an antidumping duty.   In

investigations, Commerce adopts a methodology intended to capture

overall pricing behavior for the purpose of determining who

should and should not fall within the purview of the antidumping
Consol. Court No. 10-00238                                   Page 16
duty order; for this purpose, Commerce allows negative margins to

offset positive margins.   In administrative reviews, however,

Commerce has determined that a methodology that establishes the

antidumping duty with greater accuracy is warranted both because

the importer must actually pay the resulting antidumping duty and

because it serves to uncover masked dumping10; for this purpose,

Commerce zeroes negative dumping margins.

          Commerce has offered a reasonable basis for treating

investigations and reviews differently. See Nat’l Org. of

Veterans’ Advocates, Inc. v. Sec’y of Veterans Affairs, 260 F.3d

1365, 1379–80 (Fed. Cir. 2001) (requiring agency to provide

reasonable explanation for treating the same language in two

statutory provisions differently).   This reasoning is based in

part on the antidumping statute’s objective of determining

margins as accurately as possible, Rhone Poulenc, Inc. v. United

     10
       Plaintiffs argue that Commerce cannot rely on this
reasoning because it has repudiated the necessity of zeroing as a
measure to counteract masked and targeted dumping in its recent
decision to cease zeroing in reviews. Pls.’ Comments at 10–11
(citing Antidumping Proceedings: Calculation of the Weighted-
Average Dumping Margin and Assessment Rate in Certain Antidumping
Duty Proceedings; Final Modification, 77 Fed. Reg. 8101, 8104
(Feb. 14, 2012). Plaintiffs did not raise this argument before
Commerce. See Comments on Draft Results of Redetermination
Pursuant to Court Remand, A-552-802, ARP 08–09 (Apr. 5, 2012),
Remand R. Pub. Doc. 3. Because Plaintiffs failed to raise this
argument before the Department, the court will not now consider
it. See 28 U.S.C. § 2637(d) (2006); Consol. Bearings Co. v.
United States, 348 F.3d 997, 1003 (Fed. Cir. 2003) (“In the Court
of International Trade, a plaintiff must show that it exhausted
its administrative remedies, or that it qualifies for an
exception to the exhaustion doctrine.”).
Consol. Court No. 10-00238                                   Page 17
States, 899 F.2d 1185, 1191 (Fed. Cir. 1990), in order to remedy

the effect of unfair trading practices, Chaparral Steel Co. v.

United States, 901 F.2d 1097, 1103–04 (Fed. Cir. 1990).   Such is

the basis behind seeking accuracy through zeroing in

administrative reviews.   Commerce’s reasoning is also based on

its decision to implement an adverse WTO decision regarding

investigations, which was properly done consistent with

Commerce’s authority and has been upheld as reasonable by the

Court of Appeals.   While implementation of an adverse WTO

determination is not a sufficient basis for an inconsistent

interpretation of a statute, as noted above, it is a reasonable

basis for the Department to reconsider the purpose, and therefore

methodology, of an antidumping investigation, i.e., a reasonable

basis for departing from its prior position.

           Thus, the court agrees with the recent decision in

Union Steel that “when it comes to reviews, which are intended to

more accurately reflect commercial reality, Commerce is permitted

to unmask dumping behavior in a way that is not necessary at the

investigation stage.” Union Steel, 36 CIT at    , 823 F. Supp. 2d

at 1359.   Commerce’s decision to adjust its methodology to seek

overall pricing behavior in investigations and more accurate

duties in reviews, by zeroing in reviews but not in

investigations, is a reasonable interpretation of the statute.

Because Commerce has reasonably interpreted the statute, its
Consol. Court No. 10-00238                                    Page 18
explanation for zeroing in administrative reviews but not in

investigations is affirmed.

II.   Individual Review of Grobest as a Voluntary Respondent

      A.     Background

             In the Final Results, Commerce denied a revocation

request from Plaintiff Grobest because Grobest was not

individually reviewed.     In Grobest I, Grobest challenged this

determination, arguing, inter alia, that it should have been

reviewed as a voluntary respondent pursuant to 19 U.S.C.

§ 1677m(a).11     The court found that Commerce had failed to apply

the § 1677m(a) standard when it denied Grobest’s request for

voluntary respondent status but had, instead, improperly applied

the § 1677f-1(c)(2) standard for choosing mandatory respondents.

Grobest I, 36 CIT at      , 815 F. Supp. 2d at 1362–63.   Therefore,

      11
           Section 1677m(a) reads in relevant part:

      In . . . a review under section 1675(a) of this title
      in which [Commerce] has, under section 1677f-1(c)(2) of
      this title . . . limited the number of exporters or
      producers examined . . . [Commerce] shall establish
      . . . an individual weighted average dumping margin for
      any exporter or producer not initially selected for
      individual examination . . . who submits to [Commerce]
      the information requested from exporters or producers
      selected for examination, if (1) such information is so
      submitted by the date specified (A) for exporters and
      producers that were initially selected for examination
      . . . and (2) the number of exporters or producers who
      have submitted such information is not so large that
      individual examination of such exporters or producers
      would be unduly burdensome and inhibit the timely
      completion of the investigation.
Consol. Court No. 10-00238                                     Page 19
the court remanded this challenge to Commerce to evaluate

Grobest’s request for voluntary respondent status consistent with

the standard set forth in § 1677m(a). Id. at 1364.

     B.     Analysis

            In the Remand Results, Commerce again rejected

Grobest’s request for voluntary respondent status.    On remand,

Commerce determined that individual review of Grobest “would have

been unduly burdensome and inhibited the timely completion of the

review.” Remand Results at 15.    Commerce first contends that the

workload in this case along with the workload in other

antidumping and countervailing duty cases handled by the office

in charge of this case made individual review of Grobest unduly

burdensome.    Second, Commerce contends that having fully extended

the time for the preliminary results and partially extended the

time for the final results, it could not individually review

Grobest without rendering completion of the administrative review

untimely.

            Grobest challenges the Remand Results as an

unreasonable interpretation of § 1677m(a).    In particular,

Grobest contends that “the Department says that even one company

can be a ‘large’ number under the statute.    This reading of the

statute ignores [the plain language of the provision in] that the

term ‘so large’ refers to a ‘number’ not a description of the

respondents.” Pls.’ Comments at 16 (citations omitted).
Consol. Court No. 10-00238                                   Page 20
Therefore, according to Grobest, Commerce cannot refuse to

individually review one or two voluntary respondents because

these are not “large numbers.” Id. at 16–17.

           It is not the role of the court to second guess

Commerce’s allocation of its resources. See Longkou Haimeng Mach.

Co. v. United States, 32 CIT 1142, 1151, 581 F. Supp. 2d 1344,

1353 (2008).   “[A]ny assessment of Commerce’s operational

capabilities or deadline rendering must be made by the agency

itself.” Id.; see also Torrington Co. v. United States, 68 F.3d

1347, 1351 (Fed. Cir. 1995) (“[A]gencies with statutory

enforcement responsibilities enjoy broad discretion in allocating

investigative and enforcement resources.”).    Because allocation

of resources is committed to the sound discretion of the agency,

so long as Commerce complies with statutory requirements the

court reviews its allocation decision for abuse of discretion,

i.e., “whether Commerce’s decision was ‘based on a consideration

of the relevant factors and whether there has been a clear error

of judgment.’” Torrington, 68 F.3d at 1351 (quoting Citizens to

Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971)).

           Insofar as Grobest challenges Commerce’s interpretation

of the statute pursuant to the initial step in the Chevron

framework, its argument is unavailing.   Contrary to Grobest’s

assertion, the statute does not unambiguously define “a number so

large.”   Rather, the statute conditions consideration of “a
Consol. Court No. 10-00238                                   Page 21
number so large” on whether review of such a number of

respondents would be unduly burdensome and inhibit the timely

completion of the review.    The fact that the statute sets out a

standard for interpreting “a number so large” means that there is

no definitive number contemplated under the statute.   Rather,

“number” and “large” are ambiguous statutory terms; thus, the

court must consider whether Commerce’s interpretation is

reasonable. Chevron, 467 U.S. at 842–45.

          In the Remand Results, Commerce chose to examine the

burden imposed and the effect upon the timeliness of the review

posed by individual investigation of one voluntary respondent.

In doing so, Commerce interpreted the statute not to set a floor

for the number of voluntary respondents to be reviewed; rather,

Commerce interpreted the statute to render every voluntary

respondent request subject to an undue burden and timely

completion analysis.   Such interpretation is reasonable as it

contemplates the standard set forth by the statute itself —

whether the number of respondents is so large as to be unduly

burdensome and inhibit the timely completion of the review. Cf.

F.C.C. v. AT&T Inc., 131 S. Ct. 1177, 1184 (2011) (“[S]tatutory

interpretation turns on the language itself, the specific context

in which that language is used, and the broader context of the

statute as a whole.” (quoting Nken v. Holder, 556 U.S. 418, 426

(2009) (internal quotation marks omitted)).   In contrast,
Consol. Court No. 10-00238                                    Page 22
Grobest’s argument that the number of voluntary respondents must

reach some arbitrary threshold of largeness fails to consider the

relative burdens that may be imposed by review of any one

respondent, thereby disregarding the statutorily established

standard.

            Having considered whether Commerce’s statutory

interpretation is reasonable, we must now consider whether

Commerce’s decision amounted to an abuse of discretion.      The

Court of Appeals has stated that “an agency abuses its discretion

where its ‘decision (1) is clearly unreasonable, arbitrary, or

fanciful; (2) is based on an erroneous conclusion of law; (3)

rests on clearly erroneous fact findings; or (4) follows from a

record that contains no evidence on which the [agency] could

rationally base its decision.” Sterling Fed. Sys., Inc. v.

Goldin, 16 F.3d 1177, 1182 (Fed. Cir. 1994) (quoting Gerritsen v.

Shirai, 979 F.2d 1524, 1529 (Fed. Cir. 1992)); see also Robert

Bosch LLC v. Pylon Mfg. Corp., 659 F.3d 1142, 1148–49 (Fed. Cir.

2011) (noting that a clear error of judgment occurs when an

action is “arbitrary, fanciful or clearly unreasonable”).      When

the record cannot support the agency’s determination or the

agency’s exercise of discretion exceeds the limits of the

statute, the agency has abused its discretion.

            As we explained in Grobest I, § 1677m(a) sets a

heightened standard that Commerce must meet when denying
Consol. Court No. 10-00238                                   Page 23
individual review to a voluntary respondent. See Grobest I, 36

CIT at     , 815 F. Supp. 2d at 1363.   That heightened standard

anticipates voluntary respondents placing some burden on the

agency and requires that the voluntary respondents receive an

individual review in those circumstances.     Such an expectation

was contemplated by Congress when it noted in the Statement of

Administrative Action for the Uruguay Rounds Agreements Act that

“Commerce, consistent with Article 6.10.2 of the Agreement, will

not discourage voluntary responses and will endeavor to

investigate all firms that voluntarily provide timely responses

in the form required . . . .” Uruguay Round Agreements Act,

Statement of Administrative Action, H.R. Doc. No. 103-316, vol.

1, at 873 (1994), reprinted in 1994 U.S.C.C.A.N. 4040, 4201

(“SAA”).    If this were not the case, then no analysis beyond that

required in § 1677f-1(c)(2) would be required. Cf. Grobest I, 36

CIT at     , 815 F. Supp. 2d at 1362 (“To limit voluntary

respondents through § 1677f-1(c)(2) is to foreclose review under

§ 1677m(a) barring the unexpected and irregular.”).     We held in

Grobest I that the agency cannot make a voluntary respondent

decision based on its analysis pursuant to § 1677f-1(c)(2);

likewise, the agency cannot draw its § 1677m(a) analysis so

narrowly that it mirrors the analysis under § 1677f-1(c)(2).       It

is only when the burden becomes undue that Commerce may decline

to individually review voluntary respondents.
Consol. Court No. 10-00238                                   Page 24
          In this case Commerce has failed to show undue burden

and has exercised its discretion in a way that renders the

statute meaningless.   On remand, Commerce found individual review

of one voluntary respondent to be unduly burdensome.   However,

the facts that Commerce put forward to support that conclusion do

not distinguish this case from the paradigmatic review of an

antidumping or countervailing duty order.12   Rather, the burdens

Commerce names in the Remand Results are the same burdens that

     12
       Commerce asserts the following facts to support its
determination that review of Grobest would be unduly burdensome:
The voluntary respondent materials are voluminous, require
careful examination of each response, and are likely to require
supplemental questionnaires. Remand Results at 15–16. Prior
experience examining the mandatory respondent Minh Phu Group
required four supplemental questionnaires, six deadline
extensions, and an analysis of both export and constructed export
price. Id. at 16. The second mandatory respondent, Nha Trang,
had not been reviewed previously and the Department expected to
expend significant resources reviewing Nha Trang for the first
time. Id. at 16–17. The Department’s prior experience reviewing
Grobest led it to believe that a review of Grobest would require
a “thorough examination likely involving several supplemental
questionnaires,” because the prior review of Grobest required
four supplemental questionnaires and four extensions of time. Id.
at 17. Commerce initiated a new shipper review of Nhat Duc Co.,
Ltd. on March 26, 2009. Id. The Department, and specifically
AD/CVD Operations Office 9, was concurrently involved in ten
administrative reviews and two investigations with overlapping
deadlines. Id. at 17–18. High workloads throughout the Import
Administration prevented reallocation of resources to Operations
Office 9. Id. at 18. The review of Minh Phu Group and Nha Trang
required seven supplemental questionnaires resulting in 4,535
pages and sixteen databases requiring analysis. Id. at 19.
Analysis of the factors of production in shrimp cases require
more time consuming review because the subject merchandise is
valued based on count size. Id. at 32. The Department fully
extended the deadlines for the Preliminary Results and partially
extended the deadlines for the Final Results. Id. at 19–20.
Consol. Court No. 10-00238                                   Page 25
occur in every review.    In this regard, Commerce’s decision that

the burden in this case is undue sets the bar for undue burden

too low because it would make individual review of voluntary

respondents in any typical antidumping or countervailing duty

review unduly burdensome, and such a determination renders

§ 1677m(a) meaningless. Cf. Grobest I, 36 CIT at     , 815 F. Supp.

2d at 1363; see also SAA, vol. 1 at 873, 1994 U.S.C.C.A.N. at

4201.

          When Commerce can show that the burden of reviewing a

voluntary respondent would exceed that presented in the typical

antidumping or countervailing duty review, the court will not

second guess Commerce’s decision on how to allocate its

resources. See Longkou Haimeng Mach., 32 CIT at 1151, 581 F.

Supp. 2d at 1353.   However, Commerce’s failure to make such a

showing in this case, thereby rendering § 1677m(a) meaningless,

is an abuse of discretion.   Therefore, this case is remanded to

Commerce to individually review Grobest as a voluntary respondent

and, if appropriate in light of the review, to consider Grobest’s

request for revocation.

                             CONCLUSION

          In light of the foregoing opinion, the Final Results,

75 Fed. Reg. at 47,771, as explained by the Remand Results, are

affirmed in part and remanded in part.    Commerce’s explanation
Consol. Court No. 10-00238                                   Page 26
for why it continued to zero in this review after ceasing zeroing

in investigations is affirmed.   Commerce’s assignment of the

separate rate to Amanda Foods is also affirmed.   Commerce’s

rejection of Grobest’s request for voluntary respondent status is

remanded to Commerce to conduct an individual review of Grobest

as a voluntary respondent and to reconsider Grobest’s revocation

request in light of the results of that review.

          Commerce shall have until September 14, 2012, to

complete and file its remand redetermination.   Plaintiffs and

Defendant-Intervenors shall have until September 28, 2012, to

file comments.   Plaintiffs, Defendant, and Defendant-Intervenors

shall have until October 8, 2012, to file any reply.

          It is SO ORDERED.

                                        /s/ Donald C. Pogue
                                      Donald C. Pogue, Chief Judge

Dated: July 31, 2012
       New York, New York