PAO TMK v. United States

2024 CIT 119

• Court: United States Court of International Trade
• Decided: October 25, 2024
• Docket: 21-00532
• Status: Published

Opinion

Slip Op. 24-

UNITED STATES COURT OF INTERNATIONAL TRADE

Court No. 21-00532

PAO TMK, Plaintiff, v. UNITED STATES, Defendant, and UNITED STATES STEEL CORPORATION and VALLOUREC STAR, LP, Defendant-Intervenors.

Before: M. Miller Baker, Judge

OPINION

[The court sustains the agency’s redetermination.]

Dated: October 25, 2024

Daniel J. Cannistra, Crowell & Moring LLP, Washing- ton, DC, on the comments for Plaintiff.

Dominic L. Bianchi, General Counsel; Andrea C. Cas- son, Assistant General Counsel for Litigation; and Madeline R. Heeren, Attorney-Advisor, Office of the General Counsel, U.S. International Trade Commis- Ct. No. 21-00532 Page 2

sion, Washington, DC, on the comments for Defend- ant.

Thomas M. Beline and Mary Jane Alves, Cassidy Levy Kent (USA) LLP, Washington, DC, on the comments for Defendant-Intervenor United States Steel Corpo- ration. Roger B. Schagrin and Elizabeth J. Drake, Schagrin Associates, Washington, DC, on the com- ments for Defendant-Intervenor Vallourec Star, LP.

Baker, Judge: This case involving the International Trade Commission’s conclusion that imports of Rus- sian seamless pipe are non-negligible for purposes of a material injury determination returns following re- mand, where the Commission stood its ground. Find- ing the agency’s decision supported by substantial ev- idence, the court sustains it.

I

In 2020, the Commission found that purchases of seamless pipe from Russia just barely exceeded the statutory negligibility threshold (three percent of all such imports). PAO TMK v. United States, Ct. No. 21-00532, Slip Op. 23-150, at 4–6, 2023 WL 6939242, at **1–2. (CIT Oct. 12, 2023). 1 PAO TMK, a Russian producer, challenged that determination. As relevant here, the court remanded for the agency to address U.S. Customs and Border Protection data contradict- ing the conclusion that only Company A obtained

1 The court presumes the reader’s familiarity with its pre-

vious opinion, including its use of pseudonyms for confiden- tial company names. Ct. No. 21-00532 Page 3

seamless pipe from Germany and only Company B did so from Mexico. Id. at 9, 2023 WL 6939242, at *3. 2

This matters because the Tariff Act of 1930, as amended, requires dividing the amount of in-scope purchases 3 from a given country (here, Russia) during the relevant period (the numerator) by the total quan- tity of in-scope goods imported from all nations in that same period (the denominator). See 19 U.S.C. § 1677(24)(A)(i); see also Slip Op. 23-150, at 3, 2023 WL 6939242, at *1 (quoting the statute). Acquisitions from a country are “negligible”—and not subject to

2 The court also instructed the Commission to address TMK’s evidence of in-scope imports from Germany by Com- pany C. Id. at 10–11, 2023 WL 9639242, at *4. 3 “The statute governing unfair trade investigations re- quires a determination by the Commission on whether im- ported articles within the scope of a particular investiga- tion (the ‘subject merchandise’) have injured a domestic in- dustry.” Autoliv Asp, Inc. v. United States, 422 F. Supp. 3d 1295, 1300 (CIT 2019) (citing 19 U.S.C. §§ 1671, 1673). The Department of Commerce defines what is “within the scope” and the Commission must accept that definition. Id. Here, Commerce defined “in-scope” merchandise as includ- ing certain “seamless carbon and alloy steel (other than stainless steel) pipes” of specified dimensions. Appx0001471. The Department also listed Harmonized Tariff Schedule (HTS) codes under which such pipe typi- cally enters the United States, although it cautioned that the list was for reader convenience and Customs purposes only and that the written scope description controlled. Appx0001471–0001472. In its original opinion, the court— following TMK’s lead, see ECF 33-2, at 2—used “seamless pipe” as shorthand for “in-scope,” a convention this decision also follows. As a technical matter, however, some types of seamless pipe may be outside the orders’ boundaries. Ct. No. 21-00532 Page 4

antidumping and countervailing duties—if they “ac- count for less than 3 percent” of the total volume. 19 U.S.C. § 1677(24)(A)(i). If seamless pipe buys from Germany and Mexico were higher than what the Com- mission originally found, it would increase the denom- inator for purposes of that calculation and thereby re- duce Russia’s relative share, which the agency previ- ously found teeters on the statutory knife’s edge.

On remand, the Commission found nothing to con- tradict its findings that Companies A and B “were the only known importers” of in-scope pipe from Germany and Mexico. Appx0060129 (emphasis added). It ex- plained that the Customs data included purchases both within and beyond the orders’ ambit and did not precisely align with the applicable HTS codes. Id. Fur- thermore, the codes themselves included both sorts of products. Id. Thus, the agency concluded that the Cus- toms data alone do not allow for a determination of whether the orders encompass the reported imports. Id.

The Commission noted that such a determination requires either questionnaire responses or other com- pany-specific information, but the only responses iden- tifying in-scope imports from Germany and Mexico were from Companies A and B, respectively. Appx0060129–0060130. It acknowledged that the Cus- toms data showed that other companies bought from those two countries, but said the data were inconclu- sive as to scope. Appx0060130. The agency therefore relied on the two questionnaire responses as reasona- ble estimates of the overall volume of in-scope imports from Germany and Mexico because the Customs data Ct. No. 21-00532 Page 5

did show that Companies A and B were by far the larg- est steel pipe importers during the relevant period. Appx0060131–0060133. 4 It thus reaffirmed its origi- nal determination that purchases from Russia were just barely over three percent of the total and therefore non-negligible. Appx0060135–0060136.

II

TMK challenges the Commission’s redetermination on three grounds. First, it attacks the agency’s refusal to reopen the record. See ECF 112, at 2–4. Second, it asserts that substantial evidence does not support the finding that Company A is the “only importer” from Germany. Id. at 4–7. Finally, it makes a similar argu- ment about Company B and Mexico. Id. at 7–9. Each of these contentions fails.

A

In its notice of remand proceedings, the Commis- sion announced that it was “not reopening the record

4 As for the second issue on remand—TMK’s evidence bear-

ing on Company C’s in-scope imports from Germany, see note 2—the Commission observed that the Russian entity cited bill of lading documentation, Section 232 exclusion re- quests, and Customs data showing Company C had made imports subject to a different antidumping order. Appx0060133. The agency found that none of this material showed that Company C imported merchandise within the ambit of this investigation during the relevant period or otherwise undermined its questionnaire responses. Id. Apart from its contention that the Commission should have reopened the record, discussed below, TMK asserts no chal- lenge to this finding. Ct. No. 21-00532 Page 6

and [would] not accept the submission of new factual information . . . .” Appx0060003. TMK argues that the agency should have done exactly that as to both re- manded issues because the original determination was based on incomplete data from Customs. ECF 112, at 3–4. The Commission responds that the company never objected to its decision to rely only on the exist- ing record. ECF 110-1, at 13–14.

Under exhaustion doctrine, courts help parties that help themselves before federal agencies. Having failed to ask the Commission to reopen the record, it’s now too late for TMK to complain: “Simple fairness to those who are engaged in the tasks of administration, and to litigants, requires as a general rule that courts should not topple over administrative decisions unless the ad- ministrative body not only has erred but has erred against objection made at the time appropriate under its practice.” Deseado Int’l, Ltd. v. United States, 600 F.3d 1377, 1380–81 (Fed. Cir. 2010) (quoting United States v. Tucker Truck Lines, 344 U.S. 33, 37 (1952)).

B

TMK argues that the Commission erred in relying solely on Company A’s initial questionnaire to deter- mine in-scope imports from Germany because the Cus- toms data show that other companies also made such buys. ECF 112, at 5–6.5 It claims that by not using that

5 In passing, see ECF 112, at 5, TMK also attacks the Com-

mission’s reliance—in its original determination—on Com- pany’s A initial questionnaire response, which disclosed in- scope imports from Germany. See Slip Op. 23-150, at 10, Ct. No. 21-00532 Page 7

data, the agency erroneously omitted other acquisi- tions from the negligibility analysis, so the remand re- sults are “indistinguishable from [the] original deter- mination that was found to be unlawful.” ECF 112, at 6–7. The Russian company asks the court to order the Commission to include German imports from those other entities. Id. at 4.

TMK mischaracterizes the remand instructions. The court ordered the agency “to address the Customs data.” Slip Op. 23-150, at 9, 2023 WL 6939242, at *3 (emphasis added). The Commission did so and ex- plained that as the data were inconclusive, they were useless for assessing the total volume of in-scope pipe. Appx0060129. Because Company A’s imports represented an overwhelming portion of the German total, the agency found it reasonable to use its pur- chases as the best estimate available for total in-scope

2023 WL 6939242, at *4. The Russian entity contends that this response “conflicts with official statistics.” ECF 112, at 5. This is a puzzling contention, as counting Com- pany A’s in-scope imports from Germany aids the former’s cause by increasing the denominator for purposes of the negligibility analysis. In any event, TMK never asserted this argument in the first round of litigation, where it had every opportunity to do so. The court’s sustaining of the agency’s reliance on Company A’s initial response is the law of the case and no longer susceptible to challenge at this rung of the judicial ladder. Cf. Nw. Ind. Tel. Co. v. FCC, 872 F.2d 465, 470 (D.C. Cir. 1989) (refusing to con- sider arguments not raised in original agency proceedings or on original pre-remand appeal because “[i]t is elemen- tary that where an argument could have been raised on an initial appeal, it is inappropriate to consider that argument on a second appeal following remand”) (citation omitted). Ct. No. 21-00532 Page 8

imports from that country. Appx0060132–0060133. TMK offers no meaningful response. The agency’s ex- planation accords with the statute’s allowance for “reasonable estimates on the basis of available statis- tics,” 19 U.S.C. § 1677(24)(C), so the court sustains it.

C

Finally, TMK challenges the Commission’s reliance on Company B’s initial questionnaire response to esti- mate in-scope imports of seamless pipe from Mexico. The Russian entity contends that because the Customs data showed that there were other businesses also buying in-scope Mexican pipe, the agency should have begun “its analysis with the official statistics and sub- tract[ed] out-of-scope import volumes on the record,” that is, Company B’s, the only importer that disclosed out-of-scope Mexican purchases. ECF 112, at 7–8.

TMK’s argument has a fatal flaw: That no other en- tity reported out-of-scope imports from Mexico does not mean that 100 percent of their buys from that country were in-scope. The agency reasonably ex- plained that because the record is inconclusive as to the scope status of imports from Mexico other than Company B’s, it relied on the latter’s data as an esti- mate of the whole. Appx0060130–0060132. As with the German analysis, the court holds that explanation is supported by substantial evidence and consistent with the statute. Ct. No. 21-00532 Page 9

* * *

The court sustains the International Trade Com- mission’s remand redetermination. A separate judg- ment will issue. See USCIT R. 58(a).

Dated: October 25, 2024 /s/ M. Miller Baker New York, NY Judge