Commerce Disregarded CIT Orders in Finding Questionnaire Serves as Verification, AD Petitioners Argue
The Commerce Department failed to adhere to the Court of International Trade's remand instructions concerning its duty to perform verification in an antidumping duty case, plaintiffs led by Bonney Forge argued in an Oct. 3 brief at the Court of International Trade. The trade court ordered Commerce to either conduct verification, even if virtually, or more fully explain why it cannot in the context of current conditions and not those of the investigation period. Bonney Forge argued that Commerce violated these instructions by basing its remand results on the conditions during the investigation (Bonney Forge Corporation v. United States, CIT #20-03837).
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The opinion concerns the antidumping duty investigation on forged steel fittings from India in which Shakti Forge Industries served as a mandatory respondent. Due to COVID-19 travel restrictions, Commerce said it couldn't conduct on-site verification. The agency issued supplemental questionnaires instead, took Shakti at its word and then used facts available, resulting in a zero percent dumping margin for the respondent. A group of U.S. producers filed suit at CIT, arguing Commerce can't shirk its responsibility to conduct verification (see 2107090055).
Judge Stephen Vaden sent the case back to Commerce to either conduct virtual or on-site verification or explain why it cannot. In its remand findings, the agency stuck by its position that the questionnaires sent out in light of verification fulfill the requirement to conduct verification (see 2207050070). Commerce said the plaintiffs raised the issue of virtual verification too late in the investigation.
In their reply, the plaintiffs argue that Commerce failed to follow the directive of defending its lack of virtual or on-site verification based on current conditions because the agency has carried out verifications of both types in "pending proceedings." The agency "offers no legitimate justification for not doing so here," the brief said. The plaintiffs dubbed Commerce's defense "particularly egregious" given that it took steps to carry out in-person verifications in May and June, before the remand results were filed.
Even under conditions of the original investigation, Commerce could have conducted virtual verification, the plaintiffs said. "Despite its lack of home computers and the time difference between India and the U.S., [Shakti] managed to make thirty-six electronic filings throughout the course of the investigation," the brief said. "These filings included numerous questionnaire responses comprising thousands of pages; they demonstrate that, if necessary, [Shakti] could have participated in a virtual verification session."
The plaintiffs also argued that Commerce's new definition of verification is illegal because, in the remand, the agency made a new finding that the questionnaires satisfy the verification requirement. Bonney Forge took exception to the remand submission since the result is that Commerce came to an opposite conclusion on the same record, despite that the agency did not engage in the types of inquiries that would allow it to find that the respondent's reporting was accurate.
"In essence, Commerce is asserting that its transmittal of some questionnaires and conclusion that it has verified [Shakti's] information somehow constitutes an acceptable form of verification -- even though at the time it collected the information and analyzed it, Commerce had determined that it had not verified [Shakti's] information," the brief said.