Slip Op. No. 25-56
UNITED STATES COURT OF INTERNATIONAL TRADE
BONNEY FORGE CORPORATION and UNITED STEEL, PAPER AND FORESTRY, RUBBER, MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION,
Plaintiffs, Before: Stephen Alexander Vaden, v. Judge
UNITED STATES, Court No. 1:20-cv-03837 (SAV)
Defendant,
and
SHAKTI FORGE INDUSTRIES PVT LTD.,
Defendant-Intervenor.
OPINION
[Sustaining Commerce’s Remand Determination.]
Dated: May 6, 2025
William A. Fennell, Schagrin Associates of Washington, DC, for Plaintiffs Bonney Forge Corporation and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union. With him on the brief were Roger B. Schagrin and Elizabeth J. Drake.
Kara M. Westercamp, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice of Washington, DC, for Defendant United States. With her on the brief were Brian M. Boynton, Principal Deputy Assistant Attorney General, Patricia McCarthy, Director, Claudia Burke, Deputy Director, and Court No. 1:20-cv-03837 (SAV) Page 2
JonZachary Forbes, Attorney, U.S. Department of Commerce, Office of the Chief Counsel for Trade Enforcement & Compliance.
Sezi Erdin, Trade Pacific PLLC of Washington, DC, for Defendant-Intervenor Shakti Forge Industries Pvt Ltd. With her on the brief were Robert G. Gosselink and Aqmar Rahman.
Vaden, Judge: Before the Court is the third installment in a case about
Indian forged steel fittings. This saga began at the end of 2019 when the Department
of Commerce (Commerce) initiated an antidumping investigation and selected an
Indian producer, Defendant-Intervenor Shakti Forge Industries Pvt Ltd. (Shakti), as
a mandatory respondent. Domestic petitioners Bonney Forge Corporation (Bonney
Forge) and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied
Industrial and Service Workers International Union (collectively, Plaintiffs)
challenged Commerce’s decision not to conduct an in-person verification of Shakti’s
information. This Court found merit in Plaintiffs’ objections and remanded to
Commerce. Bonney Forge Corp. v. United States (Bonney Forge I), 46 CIT __, 560 F.
Supp. 3d 1303, 1316 (2022). On remand, Commerce claimed to take new agency
action but failed to follow the necessary procedural steps. This Court remanded for
a second time. Bonney Forge Corp. v. United States (Bonney Forge II), 47 CIT __,
Court No. 1:20-cv-03837, 2023 Ct. Intl. Trade LEXIS 125, at *16 (Aug. 21, 2023).
Commerce then completed an in-person verification at Shakti’s factory in India. The
agency found no discrepancies in Shakti’s reported costs. Plaintiffs now argue that,
if Commerce had searched further, it would have found an error demonstrating
Shakti’s costs were inaccurate. The Court disagrees. Commerce’s Second Remand
Determination will be SUSTAINED. Court No. 1:20-cv-03837 (SAV) Page 3
BACKGROUND The Court presumes familiarity with this case’s facts as described in its two
previous opinions. See Bonney Forge I, 46 CIT __, 560 F. Supp. at 1305–09; Bonney
Forge II, 47 CIT __, 2023 Ct. Intl. Trade LEXIS 125, at *2–6. This opinion recounts
only those facts relevant to the Court’s review of the Second Remand Determination.
I. Procedural History
This case concerns Commerce’s Final Determination in its antidumping
investigation of Indian forged steel fittings. See Forged Steel Fittings from India:
Final Affirmative Determination of Sales at Less Than Fair Value (Final
Determination), 85 Fed. Reg. 66,306, 66,307–08 (Dep’t of Com. Oct. 19, 2020).
Commerce selected Shakti as a mandatory respondent. Decision Memorandum for
the Preliminary Determination in the Less-Than-Fair-Value Investigation of Forged
Steel Fittings from India (PDM) at 3, J.A. at 11,667, ECF No. 46. Shakti produces
finished and unfinished fittings and sells them in both India and the United States.
Shakti Section A Questionnaire Resp. at A-14–A-16, J.A. at 81,699–701, ECF No. 104.
It has two types of customers: end users and traders or distributors. Id. at A-16, J.A.
at 81,701. End users are retail consumers, while traders and distributors are
middlemen that resell the merchandise to retail consumers.
Commerce sent questionnaires to Shakti asking for data about its production
processes and costs. Request for Information, J.A. at 2,906, ECF No. 45. Shakti
described its multi-step production process as occurring in two stages — the forging
stage and the machining and packaging stage. Shakti Section A Questionnaire Resp.,
Ex. A-10(a), J.A. at 81,905–09, ECF No. 104. Shakti reported that it uses different Court No. 1:20-cv-03837 (SAV) Page 4
machining processes depending on a product’s intended customer. Id. at 81,908–09.
It said:
In process of Machining there is major difference in Domestic trader’s order and export orders. There will be no boring after drilling and socket preparation will be done in conventional laths in domestic orders. However in export orders each fitting[] will be machined 100% Boring and end preparation with [computer numerical control] Machines.
Id. at 81,908 (grammatical errors in original). In short, Shakti stated that it uses its
most sophisticated machines — known as computer numerical control machines — to
complete the finishing on products sold in the United States. Id. It uses less
sophisticated conventional lathes to complete the finishing on products sold to traders
in India. Id. Computer numerical control machines require greater labor and energy
costs than conventional lathe machines. Oral Arg. Tr. at 12:1-13, ECF No. 113.
Shakti also reported that it does not usually perform heat treatment and surface
finishing on products sold to traders in India. Shakti Section A Questionnaire Resp.,
Ex. A-10(a), J.A. at 81,907, ECF No. 104. These processes add costs, as well.
Shakti submitted cost sheets for its merchandise at Commerce’s request. Pls.’
R. 56.2 Br. at 4, ECF No. 25. For certain products sold to Indian traders, Shakti
reported costs for time spent on computer numerical control machines. Id. at 8.
Shakti similarly reported surface finishing and heat treatment costs for domestic
Indian sales despite earlier stating that it does not usually perform these processes
on products sold to traders in India. Shakti Section A Questionnaire Resp., Ex. A-
10(a), J.A. at 81,908, ECF No. 104. Court No. 1:20-cv-03837 (SAV) Page 5
Commerce originally chose not to verify Shakti’s questionnaire responses
because of the COVID-19 pandemic. Cancellation of Verification and Briefing
Schedule, J.A. at 13,906, ECF No. 46. Plaintiffs suggested that Commerce perform a
virtual verification in place of a traditional on-site verification. Pls.’ Administrative
Br. at 19–20, J.A. at 91,588–89, ECF No. 45. Commerce did not respond to this
request. Issue and Decision Memorandum for the Final Determination in the Less-
Than-Fair-Value Investigation of Forged Steel Fittings from India (Final IDM) at 1–
23, J.A. at 14,126–48, ECF No. 46; Oral Arg. Tr. 25:7–8, ECF No. 53 (Ms.
Westercamp: “There is no discussion [in the record] about why a virtual verification
would not have been feasible.”). Instead, it issued a series of supplemental
questionnaires to Shakti. See, e.g., Suppl. Questionnaire (Mar. 20, 2020), J.A. at
6,022, ECF No. 46; Sections A–D Suppl. Questionnaire (Apr. 16, 2020), J.A. at 8,183,
ECF No. 46. Commerce then determined that, although it could not verify Shakti’s
information, it would use the information Shakti provided as “facts available” in
making its determination. Final IDM at 16–20, J.A. at 14,141–45, ECF No. 46; see
also 19 U.S.C. § 1677e(a)(2)(D) (“If … an interested party … provides such
information but the information cannot be verified … [Commerce] shall … use the
facts otherwise available in reaching the applicable determination ….”). It assigned
Shakti a dumping margin of zero percent. Final Determination, 85 Fed. Reg. at
66,307. Court No. 1:20-cv-03837 (SAV) Page 6
The Remands
Plaintiffs timely filed suit. Compl., ECF No. 9. They alleged that Commerce
improperly ignored Plaintiffs’ request for a virtual verification, and the agency should
have rejected Shakti’s processing costs for being inconsistent with its earlier claims.
Id. ¶¶ 14–18, 25–27. The Court remanded to Commerce with instructions to “assess
the current state of the COVID-19 pandemic, consider whether a virtual verification
is possible, and act accordingly.” Bonney Forge I, 560 F. Supp. 3d at 1316. Commerce
then claimed to take new agency action: It found that Shakti’s answers to the
supplemental questionnaires verified the necessary information. Final Results of
Redetermination Pursuant to Ct. Remand (First Remand Determination) at 2, ECF
No. 61. Commerce also offered a “fuller explanation as to the option of a remote, real-
time verification and why a verification conducted in real time was not plausible
during the investigation.” Id.
The Court remanded to Commerce a second time. Bonney Forge II, 47 CIT __,
2023 Ct. Intl. Trade LEXIS 125, at *15–16. It explained that, under Department of
Homeland Security v. Regents of the University of California, 591 U.S. 1 (2020), an
agency has two possible paths on remand: “It may offer a fuller explanation of its
reasoning at the time of the action it defends, or it may take new agency action.”
Bonney Forge II, 47 CIT __, 2023 Ct. Intl. Trade LEXIS 125, at *15 (citing Regents,
591 U.S. at 20–21). An agency “is not limited to its prior reasons but must comply
with … procedural requirements” when it takes new action. Id. at *11 (quoting
Regents, 591 U.S. at 21). For example, “when an agency rescinds a prior policy its Court No. 1:20-cv-03837 (SAV) Page 7
reasoned analysis must consider the ‘alternative[s]’ that are ‘within the ambit of the
existing [policy].’” Regents, 591 U.S. at 30 (quoting Motor Vehicle Mfrs. Assn. of
United States, Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 51 (1983))
(alterations in original). And when deviating from a past practice or policy, an agency
“must be cognizant that longstanding policies may have ‘engendered serious reliance
interests that must be taken into account.’” Id. (quoting Encino Motorcars, LLC v.
Navarro, 579 U.S. 211, 222 (2016)).
Though Commerce claimed it had taken “new agency action,” it did not explain
why it refused to take any further steps to verify Shakti’s information during the
remand period. Bonney Forge II, 47 CIT __, 2023 Ct. Intl. Trade LEXIS 125, at *14.
Commerce also did not account for how its past practice of conducting in-person
verifications may have created reliance interests for domestic petitioners like Bonney
Forge. Id. at *12–13. The Court directed Commerce to comply with Regents’
requirements for new agency action by considering (1) Bonney Forge’s reliance
interests implicated by the agency’s change of policy regarding verification and (2)
alternative options to further verify the information on the record under current
conditions. Id. at *15.
II. Present Dispute
In response to the Court’s Second Remand Order, Commerce completed an in-
person verification at Shakti’s factory in Rajkot, India, from November 5-10, 2023.
Sales Verification Report at 1, J.A. at 14,455, ECF No. 104. Commerce toured
Shakti’s factory and reviewed sales and cost records for Shakti’s highest-selling Court No. 1:20-cv-03837 (SAV) Page 8
products. Cost Verification Report at 5, 12, J.A. at 92,892, 92,899, ECF No. 104. Its
Second Remand Determination again calculated a zero percent dumping margin for
Shakti. Final Results of Redetermination Pursuant to Ct. Remand (Second Remand
Determination) at 12, ECF No. 90.
Commerce found that Shakti satisfactorily explained the finishing costs
discrepancy Plaintiffs identified. Id. at 10–12. Shakti clarified that “finished
products could undergo” one of three finishing processes or a combination of the
processes “based on the availability of the machine.” Cost Verification Report at 22,
J.A. at 92,909, ECF No. 104. When conventional lathes are unavailable, Shakti might
use a computer numerical control machine to complete the finishing. Commerce
observed the different finishing machines were “adjacent to each other” in the factory
and concluded that Shakti’s explanation was reasonable. Second Remand
Determination at 11, ECF No. 90 (citing Sales and Cost Verification Ex., Ex. CVE-4,
J.A. at 92,440, 92,442, ECF No. 104).
Commerce also verified the two control numbers1 representing the products
sold at the highest volume in both the Indian and U.S. markets and reviewed
paperwork demonstrating what processes those products underwent. Def.’s
Corrected Resp. to Pls.’ Comments on Second Remand Results (Def.’s Comments) at
1 “Control number,” often referred to by the contraction “CONNUM,” denotes a unique product based on relevant physical characteristics. To ensure that Commerce is comparing like products in the home and U.S. markets, it asks respondents to sort merchandise according to key differentiating categories with each number in the product’s control number corresponding to physical characteristics particular to the merchandise under review. Xi’an Metals & Minerals Imp. & Exp. Co. v. United States, 45 CIT __, 520 F. Supp. 3d 1314, 1321 n.4 (2021). As a simple shorthand, a reader may substitute “product” any time he reads “control number” or “CONNUM.” Court No. 1:20-cv-03837 (SAV) Page 9
7, ECF No. 102. Both control numbers included sales to domestic and U.S. customers,
but neither covered a product sold exclusively to Indian traders. Id. at 7. Commerce
found no discrepancies in the documentation it reviewed for the two control numbers.
Id. at 9. Having verified Shakti’s cost data to its satisfaction, Commerce made no
adjustments to Shakti’s dumping margin. Id. at 4. Plaintiffs now argue that the
Second Remand Determination is not based on substantial evidence because
Commerce “failed to conduct a meaningful verification” of Shakti’s reported finishing
costs. Pls.’ Corrected Comments on Second Remand Determination (Pls.’ Comments)
at 4, ECF No. 96. Plaintiffs are particularly concerned that Shatki, contrary to its
original claim, did not limit use of the more expensive computer numerical control
machines to products bound for the United States. Id. at 2. They imply that Shakti
could have manipulated its dumping margin by shifting costs from some products to
others. Id. Plaintiffs argue that Commerce did not do enough to verify Shakti’s costs
in light of these errors so that its decision not to apply an adverse inference is
unsupported by substantial evidence. Id. at 8.
The Government responds that Commerce fully complied with the Court’s
Second Remand Order. Def.’s Comments at 5, ECF No. 102.2 Commerce argues it
has wide latitude in deciding how to conduct verification. Id. at 8 (citing Am. Alloys,
Inc. v. United States, 30 F.3d 1469, 1475 (Fed. Cir. 1994)). It also notes that Plaintiffs
have not claimed that Commerce’s verification revealed any errors. Id. Commerce
spent a week conducting verification, including a factory tour and review of
2 Shakti “concurs with the arguments provided by the Defendant.” Def.-Int.’s Resp. to Pls.’ Comments on Second Remand Determination at 1, ECF No. 103. Court No. 1:20-cv-03837 (SAV) Page 10
documentation. Id. Nothing reviewed indicated errors in Shakti’s cost reporting. Id.
The agency argues that “just keep looking” is not a valid objection. Id. at 6.
The Court held oral argument on November 12, 2024. ECF No. 110. Plaintiffs
raised for the first time an argument that the Government’s brief misquoted language
Shakti put on the record. They alleged this error changed the meaning of Shakti’s
statements. Oral Arg. Tr. at 10:20–11:24, ECF No. 113. The statements once again
concerned what processes Shakti uses on certain products. Plaintiffs argued that, by
misquoting Shakti, Commerce covered up the gravity of this inconsistency.
JURISDICTION AND STANDARD OF REVIEW
This Court has exclusive jurisdiction over Plaintiffs’ challenge to Commerce’s
Final Determination under 19 U.S.C. § 1516a(a)(2)(B)(i) and 28 U.S.C. § 1581(c),
which grant the Court authority to review actions contesting final affirmative
determinations, including any negative part of such determinations, in an
antidumping order. The Court must sustain Commerce’s “determination, finding, or
conclusion” unless it is “unsupported by substantial evidence on the record, or
otherwise not in accordance with law[.]” 19 U.S.C. § 1516a(b)(1)(B)(i). Substantial
evidence “means such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion.” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229
(1938) (citations omitted). “The court reviews remand determinations for compliance
with the court’s remand order.” Nakornthai Strip Mill Pub. Co. Ltd. v. United States,
32 CIT 1272, 1274 (2008) (citations omitted). Court No. 1:20-cv-03837 (SAV) Page 11
DISCUSSION
In Bonney Forge II, the Court ordered Commerce to consider (1) the reliance
interests implicated by its change of policy regarding verification and (2) alternative
options to further verify the information on the record under current conditions. Now
that the agency has completed an in-person verification, Commerce has satisfied both
Regents requirements. Plaintiffs’ only remaining argument is that Commerce’s
verification was deficient because it failed to address inaccuracies in Shakti’s
finishing costs. This Court is unconvinced. Commerce has complied with both
Regents requirements and supported its Second Remand Determination with
substantial evidence. The Second Remand Determination is SUSTAINED.
I.
First, Commerce addressed any issues arising from Bonney Forge’s reliance on
Commerce’s past practice. When deviating from a consistent past practice or policy,
an agency “must be cognizant that longstanding policies may have ‘engendered
serious reliance interests that must be taken into account.’” Regents, 591 U.S. at 30
(quoting Encino Motorcars, 579 U.S. at 222). Here, Commerce acknowledged that it
has a practice of performing in-person, on-site verification whenever possible. First
Remand Determination at 20, ECF No. 61. Bonney Forge therefore had a reliance
interest rooted in this past practice that Commerce needed to consider. See Regents,
591 U.S. at 30. By conducting an in-person verification in India, Commerce gave the
parties the same treatment they would have received but-for the pandemic. See
Second Remand Determination at 4, ECF No. 90 (“Commerce’s in-person verification Court No. 1:20-cv-03837 (SAV) Page 12
on remand … is consistent with Commerce’s longstanding general verification
practice[.]”). There can be no harm to Bonney Forge stemming from its reliance
interests because Commerce has returned to its past practice. No party disputes that
Bonney Forge’s reliance interests have been met. Oral Arg. Tr. at 4:10–20, ECF No.
113 (counsel for Bonney Forge and Shakti stating that they do not object). The Court
therefore finds that Commerce satisfied the first Regents requirement by returning
to its past practice and conducting an in-person verification.
Second, Commerce satisfied the other Regents requirement by reconsidering if
it had any alternative options for verification and explaining its reasoning. Bonney
Forge II, 47 CIT __, 2023 Ct. Intl. Trade LEXIS 125, at *15. Commerce answered by
conducting an in-person verification and reviewing information related to Shakti’s
production costs. Second Remand Determination at 4, ECF No. 90. Because
Commerce returned to its past practice of performing in-person verifications, there is
no need for it to consider an alternative path that would be closer to Commerce’s past
practice. No party objects to Commerce’s decision. See Oral Arg. Tr. at 4:10–20, ECF
No. 113. The Court therefore finds that Commerce appropriately “deal[t] with the
problem afresh.” Regents, 591 U.S. at 21 (quoting SEC v. Chenery Corp., 332 U.S.
194, 201 (1947)).
II.
With procedure finally being vanquished, the Court can turn to the merits.
Plaintiffs complain that Commerce did not search deeply enough when conducting its
in-person verification. Pls.’ Comments at 4–8, ECF No. 96; Oral Arg. Tr. at 19:8–9, Court No. 1:20-cv-03837 (SAV) Page 13
ECF No. 113 (Mr. Fennell: “[Commerce’s] verification did not get far enough ….”).
They assert that the agency should have verified specific documents related to
Shakti’s sales of subject merchandise to traders in India. Pls.’ Comments at 7–8, ECF
No. 96. Absent that, Plaintiffs say Commerce should apply facts available with an
adverse inference to the finishing costs for such sales. Id. at 8. The Government
responds that Commerce is not bound by such strict verification requirements. Def.’s
Comments at 5–10, ECF No. 102.
Commerce “shall verify all information relied upon in making … a final
determination in an investigation.” 19 U.S.C. § 1677m(i)(1). But the law does not
require Commerce to turn over every stone. See PMC Specialties Grp., Inc. v. United
States, 20 CIT 1130, 1134 (1996) (quoting Monsanto Co. v. United States, 12 CIT 937,
944 (1988)) (“Verification … is not intended to be an exhaustive examination of the
respondent’s business.”); Kerr-McGee Chem. Corp. v. United States, 14 CIT 344, 362
(1990) (“Congress intended that [Commerce] … not be required to comply with all
requests for specific types of investigation.”). Instead, “verification is a spot check” in
which Commerce “has considerable latitude in picking and choosing which items it
will examine in detail.” PMC Specialties Grp., 20 CIT at 1134 (quoting Monsanto, 12
CIT at 944). The Federal Circuit has held that Commerce enjoys “wide latitude in its
verification procedures.” Am. Alloys, 30 F.3d at 1475.
Here, Commerce acted within the bounds of that latitude. Commerce
conducted its verification with Plaintiffs’ objections in mind. It observed the close
proximity of the different types of finishing machines at issue while touring Shakti’s Court No. 1:20-cv-03837 (SAV) Page 14
factory. Cost Verification Report at 5, J.A. at 92,892, ECF No. 104. Based on those
observations, Commerce found Shakti’s explanation — that it uses computer
numerical control machines when other, less sophisticated machines are not
available — to be reasonable. Second Remand Determination at 10–11, ECF No. 90.
Commerce also reviewed records related to the two highest-volume control numbers,
which were representative of sales to end users and traders in the home and export
markets. It did not find a single inaccuracy. Cost Verification Report at 12, J.A. at
92,899, ECF No. 104. Commerce would have had a more difficult time meeting the
substantial evidence standard if it did not conduct an in-person verification. Only a
factory visit could confirm the machines’ placement. The record reflects a
comprehensive, one-week, in-person verification; and Commerce acted within its
discretion. See Am. Alloys, 30 F.3d at 1475.
Commerce did not have to keep searching through more data at the chance of
finding an error. Verification is a spot check, PMC Specialties Grp., 20 CIT at 1134,
and here, Commerce reasonably selected the two highest-volume control numbers.
Cost Verification Report at 12, J.A. at 92,899, ECF No. 104. The agency did not find
a single error in the documentation it reviewed related to those two products. Id.;
Second Remand Determination at 7–8, ECF No. 90. Plaintiffs concede that the data
Commerce reviewed were correct. See Oral Arg. Tr. at 7:7–11, ECF No. 113 (The
Court: “Is there any error that you believe is present in the record that [Commerce]
missed with regard to the transactions … they actually verified?” Mr. Fennell: “No,
Your Honor.”). Moreover, what Commerce read in Shakti’s paperwork matched what Court No. 1:20-cv-03837 (SAV) Page 15
it observed on the factory tour. Second Remand Determination at 7–8, ECF No. 90.
Plaintiffs do not claim that anything about the factory or Shakti’s machines changed
between the investigation and the in-person verification — which would raise
questions about the reliability of a later-in-time verification. See Pls.’ Comments at
5–8, ECF No. 96 (raising several issues with Commerce’s verification but not alleging
that anything changed in the relevant time period). Plaintiffs received Commerce’s
verification agenda before the factory visit and knew what information Commerce
intended to review. See Attach. to Def.’s Notice to the Ct., ECF No. 111; see also Oral
Arg. Tr. at 30:6–19, ECF No. 113. They had the opportunity to submit pre-verification
comments reflecting any objections to the proposal but chose not to do so. Def.’s
Notice to the Court Following Oral Arg. at 1-2, ECF No. 111. And Plaintiffs have
been unable to cite any case law supporting their position. See Oral Arg. Tr. at 14:23–
15:3, ECF No. 113 (The Court: “[A]re there any cases that you can cite to me … where
a court has ordered Commerce to look at additional transactions as part of the
verification process? … Mr. Fennell: “Not to my knowledge, Your Honor.”).
Plaintiffs ask for Commerce to apply facts available with an adverse inference
to Shakti’s finishing costs. Pls.’ Comments at 8, ECF No. 96. They misunderstand
the statutory scheme. When Commerce is missing data necessary to calculate the
normal value of merchandise, the antidumping statute provides a two-part process to
fill the gap. See 19 U.S.C. § 1677e(a)–(b). The first part of that process allows
Commerce to use “facts otherwise available” in place of missing or unverifiable
information. 19 U.S.C. § 1677e(a); see also 19 C.F.R. § 351.308(a). The second part Court No. 1:20-cv-03837 (SAV) Page 16
permits Commerce to apply an adverse inference when selecting from the facts
available if “an interested party has failed to cooperate by not acting to the best of its
ability to comply with a request for information from [Commerce] ….” Id. §
1677e(b)(1).
Plaintiffs’ argument fails at part one. They claim the missing information is
“accurate costs” for Shakti’s finishing processes. See Oral Arg. Tr. at 41:18–20, ECF
No. 113 (Mr. Fennell: “The gap that needs to be filled, which would be filled in
another case that had more information, would be accurate costs.”). Plaintiffs do not
dispute that all the costs related to the selected control numbers verified. Id. at
17:23–18:1. They have failed to identify any missing or unverifiable information.
Bonney Forge responds that Commerce’s verification was deficient and that
Commerce should apply facts available with an adverse inference to an undiscovered
gap. That is not possible. See Oral Arg. Tr. at 42:5–9, ECF No. at 113 (The Court:
“Do you have any case law to cite to me where there is a gap because of something
Commerce chose not to verify?” Mr. Fennel: “I know of no such case, Your Honor.”).
Because the information Commerce chose to verify proved accurate, there is no gap
in the record to fill. Without a gap to fill, there can be no adverse inference. See 19
U.S.C. § 1677e(a). Plaintiffs’ requested relief is in contravention of the statute’s plain
text.
Plaintiffs’ last ditch semantic argument fares no better. Plaintiffs cite to where
Shakti described its production process during verification:
an item can undergo … any of above three process or in combination of above three process depending upon the market (domestic or export) Court No. 1:20-cv-03837 (SAV) Page 17
where the product is sold and depending upon the availability of machines where the product is produced as per the actual experience of [Shakti].
Shakti’s Rebuttal Comments, J.A. at 9,137, ECF No. 46 (emphasis added;
grammatical errors included). The Government relied on this language for its claim
that Shakti clarified any discrepancies related to finishing costs. Oral Arg. Tr. at
11:14–24, ECF No. 113. But Plaintiffs note that the Government substituted “or” for
“and” when quoting Shakti’s explanation. Id. at 11:14-15. Plaintiffs claim that this
substitution is improper because it changes the meaning. Id. at 11:15–21. By using
“and,” a conjunctive, they say Shakti made any change in its normal finishing
procedures contingent on both conditions — the market and the availability of
machines — being met. Thus, Shakti could not switch to a computer numerical
control machine just because the conventional lathe machines were unavailable;
Shakti would also need to be producing product for the export market or end users in
the home market. Id. The Government says it was paraphrasing Shakti’s language,
not misquoting it. Id. at 43:3–44:1 (Ms. Westercamp: “[I]f there’s no challenge to the
accuracy of the Commerce personnel visit to the Shakti plant and its explanation and
the cost verification, then it’s really whether I should have used and/or in my brief
….”). Without more, the Government argues, Plaintiffs’ concern about the particular
words used does not undermine the existence of substantial evidence supporting
Commerce’s determination. Id. at 42:14-24.
The Government was paraphrasing Shakti, not quoting its statement.
Commerce quoted the language at issue in full just one sentence prior, and that quote Court No. 1:20-cv-03837 (SAV) Page 18
accurately uses "and." Def.'s Comments at 9, ECF No. 102. Further, the term "and"
does not always create a conjunctive list where every item in the list must be satisfied
for the condition to be met. See Pulsifer v. United States, 601 U.S. 124, 136 (2024)
(explaining that the phrase "I didn't like his mother and father" means "I didn't like
his mother and I didn't like his father ... " - not that the speaker liked eithel'. person
on their own but not together). This is especially true when an introductory phrase
- in this case "depending upon" - modifies the list. Id. at 134. In such a case, "and"
can function as an "or," creating a list where only one of the listed conditions needs
to be satisfied. Id. at 151 ("[C]onjunctions are versatile words, which can work
differently depending on context."). Plaintiffs' argument therefore fails to raise any
concern that the Government has misrepresented Shakti's finishing procedures.
Substantial evidence supports Commerce's determination.
CONCLUSION
The third time proved to be the charm. Commerce satisfied Plaintiffs' reliance
interests by completing an in-person verification. Although Plaintiffs complain that
Commerce could have found errors if it had continued searching, verification is not
an unending hay$tack search for a needle. No statute or case law requires Commerce
to continue digging after it has completed a spot check. Neither will this Court do so.
Commerce's Second Remand Determination is SUSTAINED.
Dated: /,,1 LolS sd1tx1zt ~ n, Judge
New York, New York