Chefline Corp. v. United States (219 F. Supp. 2d 1303, 2002)

OPINION

POGUE, Judge.

On September 26, 2001, this Court remanded certain aspects of the United States International Trade Commission’s (“Commission”) final determination in Porcelain-on-Steel Cooking Ware from Chi no, Mexico, and Taiwan, and Top-of-the-Stove Stainless Steel Cooking Ware from Korea and Taiwan, Inv. Nos. 701-TA-267 & 268 (Review) and 731-TA-297-299, 304 & 305 (Review), USITC Pub. 3286, (March 2000) (“Review Determination”). See Chefline v. United States, 25 CIT -, 170 F.Supp.2d 1320 (2001) (“Chefline I”).

The remand order directed the Commission to reconsider its decision to cumulate top-of-the-stove stainless steel cookware from Korea and Taiwan. In the event that the Commission should decide not to cu-mulate, the Commission was instructed to reconsider whether revocation of the orders on Korean top-of-the-stove cookware would likely lead to continuation or recurrence of material injury to the domestic industry, within a reasonably foreseeable time.

After reopening the record, the Commission determined that there was not enough evidence to support cumulating subject imports from Korea and Taiwan, and affirmed its determination that subject imports from Korea would, upon revocation of the antidumping and countervailing duty orders, likely result in injury to the United States market within a reasonably foreseeable time. Plaintiffs Chefline Corporation, Inc., Daelim Trading Co., Ltd., Dong Won Metal Co., Ltd., Hai Dong Stainless Steel Co., Ltd., Kyung Dong Industrial Do., Ltd., Namyan Kitchenflower Co., Ltd., O’bok Stainless Steel Co., Ltd., and Sam Yeung Industrial Co., Ltd. (collectively “Plaintiffs” or “Chefline”) contest the Commission’s affirmative determination of antidumping and countervailing duty orders on top-of-the-stove stainless steel cookware from Korea. After review of the issues raised by the Plaintiff, we uphold the Commissions’ determination.

Standard of Review

The Commission’s determination will be upheld unless it is unsupported by substantial evidence in the administrative record or is otherwise not in accordance with the law. See 19 U.S.C. § 1516a(b)(l)(B)(P (1994).

Substantial evidence is “more than a mere scintilla,” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938), but “something less than the weight of the evidence.” Consolo v. Fed. Mar. Comm’n, 383 U.S. 607, 620, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966). The Court’s function is not to re-weigh the evidence but rather to ascertain whether there exists “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Consol. Edison Co., 305 U.S. at 229, 59 S.Ct. 206.

Analysis

I. Cumulation

Under 19 U.S.C. § 1675a(a)(7), either a finding that imports will have no discernible adverse impact on the domestic industry or a finding that there is no reasonable overlap of competition between imports from different countries is sufficient to preclude cumulation. See also Neenah Foundry Co. v. United States, — CIT -,-, 155 F.Supp.2d 766, 771 (2001). In our original review of the Commission’s sunset determination we found that there was not substantial evidence supporting either a finding of reasonable overlap of competition between Korean and Taiwanese imports or a finding that Taiwanese imports would have a discernible adverse impact.

Upon remand, the Commission sought to supplement the record by sending questionnaires to over forty companies in Taiwan, in order to gather information on the nature of Taiwanese subject imports. Remand Determ, at 8. Although none of the Taiwanese producers provided data in response to the questionnaires, the Commission was able to collect information from telephone conversations with Taiwanese producers and importers of Taiwanese top-of-the-stove stainless steel cooking ware. Id.

Although one Taiwanese manufacturer stated that it produced high-end merchandise, the Commission was unable to ascertain whether the Taiwanese high-end merchandise was equivalent to high-end merchandise sold in the U.S. market. In another telephone conversation, an importer of subject merchandise from Korea and Taiwan indicated that “although Taiwan had the capability of producing higher-end stainless steel cooking ware, Taiwan producers were not as good at producing it.” Id. The Commission also found that the average unit value of cooking ware from Taiwan is substantially less than that for cooking ware from Korea, suggesting that recent imports from Taiwan were probably not high-end cooking ware. Based on this new information, the Commission concluded that subject imports from Taiwan were of a lower quality than the Korean product. See Remand Determ, at 6. Therefore, the Commission found that there was no reasonable overlap of competition between subject imports from Korea and Taiwan and declined to cumulate subject imports from the two countries. See' Id. at 5 (holding that because the finding of no reasonable overlap is “dispositive of the cumulation issue, we do not address the issue of no discernible adverse impact”). On the limited record here, the evidence of Taiwanese production is sufficient for a reasonable person to conclude that the Taiwanese producers do not sell high-end products. Accordingly, we find the Commissions decision not to cumulate imports from Taiwan and Korea to be supported by substantial evidence.

II. Antidumping and Countervailing Duty Orders on Top-of-the-Stove Stainless Steel Cooking Ware from Korea

Because the Commission determined there was not enough evidence to support cumulating subject imports from Korea and Taiwan, it was required to reexamine the determination that revocation of the antidumping and countervailing duty orders on Korean subject imports would be likely to lead to a continuation or recurrence of material injury within a reasonably foreseeable time. The Commission found that even without cumulating subject imports, the orders regarding Korean subjéct’' imports should not be revoked.

A. Rebuttal Comments

As a preliminary matter, Chefline appeals the Commission’s rejection of Chef-line’s rebuttal comments and asks the Court to take judicial notice of these comments.

1. Background

In the remand proceeding, the Commission reopened the record “for the limited purpose of (1) seeking basic information regarding subject product from Taiwan and (2) seeking to cure the possible inclusion of non-subject products in official import data.” Letter from USITC to Hogan & Hartson, LLP (Dec. 10, 2001), Pl.’s App. 1, at 1. The Commission asked all interested parties to submit two sets of comments. The first set of comments was limited to information on the likelihood of overlap of competition between Taiwanese and Korean imports with the domestic like product, whether using a value-based instead of a quantity-based statistic would be a more accurate measure of subject import volume, and “the extent to which non-subject merchandise from Korea and Taiwan is included in United States [HTSUS] 7323.93.00.30 (i.e. the ratio of subject to non-subject merchandise).” Id. at 2. These comments, due by December 28, 2001, could include new factual information.

The parties were also informed that they could submit a second set of comments “responding to other parties’ first sets of comments or to new information released to the parties by the Commission too late to be included in the first set of comments.” Id. The Commission made clear that these comments, due at the close of business on January 4, 2001, could not include any new factual information. Id.

As part of their first set of comments, Defendant-Intervenor Stainless Steel Cookware Committee provided a sworn affidavit by the Executive Vice President of the Cookware Manufacturers Association (“CMA”), Hugh Rushing. See Comments on Remand by the Stainless Steel Cookware Committee at Ex. 1 (“Rushing Affidavit”) (Dec. 20, 2001), Def.-Int.’s ConLApp. at 16 (“Committee’s Remand Comments”). The Rushing Affidavit, based on CMA data, estimated that 97 percent of Korean 7323.93.0030, HTSUS, imports were top-of-the-stove stainless steel cookware. On January 7, several days after the end of the comment period, Chefline submitted rebuttal comments on the Rushing Affidavit to the Commission.

The Commission rejected Chefline’s comments for being untimely and containing new information, in violation of its instructions. Chefline argues that nothing in the Commission’s statute or regulations addresses this type of situation and that 19 U.S.C. § 1677m(g), contrary to the Commission’s suggestion, does not apply to new information submitted by parties to the ease; rather, Chefline argues that 19 U.S.C. § 1677m(g) is only applicable for new information obtained by the Commission. PL’s Mem. Supp. Mot. J. Agency R. at 18 (“Chefline Br.”). Chefline also claims that the “Commission was clearly wrong to reject this data,” because “[t]he Rushing Affidavit clearly provided information beyond the parameters of the instructions to the parties regarding written submissions.” Id. at 17. Lastly, Chefline contends that the information contained in the rebuttal comments is public information of the type for which judicial notice is appropriate.

2. Commission’s Rejection of Chef-line’s Comments

A) Commission’s Statutory Guidelines

The Commission gathers new information pursuant to 19 U.S.C. § 1677m(g). Section 1677m(g) provides that:

Information that is submitted on a timely basis to the administering authority or the Commission during the course of a proceeding under this subtitle shall be subject to comment by other parties to the proceeding within such reasonable time as the administering authority or the Commission shall provide. The administering authority and the Commission, before making a final determination under section 1671d, 1673d, 1675, or 1675b of this-title shall cease collecting ■ information and shall provide the parties with a final opportunity to comment on the information obtained by the administering authority or the Commission (as the case may be) upon which the, parties have not previously had an opportunity to comment. Comments containing new factual information shall be disregarded.

19 U.S.C. § 1677m(g). Although Chefline claims that section 1677m(g) applies, only to new information obtained by the Commission, rather than new information submitted by parties, see Chefline Br. at 18, the statute also includes information “that is submitted on a timely basis to the administering authority or the Commission.” 19 U.S.C. § 1677m(g) (emphasis supplied). Furthermore, the Commission is required to close the record “prior to the time the agency’s determination is made, and ... the parties to the proceeding [are to] be permitted a final opportunity to comment on all information obtained by the agency upon which the parties have not yet had an opportunity to comment.” .Uruguay Round Agreements 'Act, Statement of -Administrative Action, H.R.Rep. No. 103-826 (1994), reprinted in 1994 U.S.C.C.A.N. 4040 at 871 (“SAA”). Both 1677m(g) and the SAA expressly include, .information submitted to the agency, such as that at issue here.

Chefline further argues that the Commission’s regulations do not even address remand proceedings, particularly when such proceedings allow for new information to be submitted for the record. Chefline Br. at 18. Section 1677m(g), however, refers to final determinations made under 19 U.S.C. § 1675, among others. The determination at issue is a sunset review remand determination. Sunset reviews are made pursuant to section 1675(c). Although the Commission’s procedural regulations do not contain provisions specifically directed to remand proceedings, the reference to section 1675 is sufficient to permit application of the regulation to remand proceedings conducted within the context of a sunset review proceeding.

B) Rushing Affidavit

Chefline also argues that the Rushing Affidavit does not address the limited issues upon which the Commission allowed new factual submissions. According to the Commission’s letter new information could be submitted to help it determine “the extent to which non-subject merchandise from Korea and Taiwan is included in United States [HTSUS] 7323.93.00.30 (i.e. the ratio of subject to non-subject merchandise).” Letter from USITC to Hogan & Hartson, LLP at 2 (Dec. 10, 2000), Pl.’s App. 1 at 1. The Rushing Affidavit estimated the aggregate United States market for top-of-the-stove stainless steel cookware and stainless steel bakeware. It then extrapolated from this information to determine the percentage of imports from Korea and Taiwan under HTSUS item number 7323.93.00.30.

Thus, the Affidavit attempts to determine the extent to which subject and non-subject merchandise from Korea and Taiwan is included in 7323.93.00.30, HTSUS, concluding that such items constitute 97 percent and 3 percent, respectively, of imports under the HTSUS number. Accordingly, without determining whether the Rushing Affidavit supports the Commission’s finding, as will be discussed infra page 16-17, we find that the Affidavit addresses the precise issue contemplated by the Commission’s directive.

3. Judicial Notice

Chefline also asks the Court to take judicial notice of the information proffered to rebut the Rushing Affidavit because it is public information. See Chef-line Br. at 18. The court takes judicial notice pursuant to Fed.R.Evid. 201(c). Although the court is mindful of the deference owed to the Commission in the administration of antidumping laws, judicial notice is proper when “credible evidence from outside the record indicates a significant error” in the agency’s determination. Union Camp Corp. v. United States, — CIT-, -, 53 F.Supp.2d 1310, 1324 (1999). The result of judicial notice “is effectively no different from a reversal for reconsideration because a fact relied on is unsupported by the evidence.” Borlem S.A.-Empreedimentos Industriais v. United States, 913 F.2d 933, 940 (Fed.Cir.1990).

Here, Chefline submitted scope determinations and customs rulings indicating that HTSUS 732.93.0030 includes numerous non-subject product categories other than ovenware and several newspaper articles discussing the composition of the cookware and bakeware industry. See Korean Producers’ Comments (Jan. 4, 2002), Attach. 1, 2. Although the scope descriptions and customs rulings discuss non-subject articles contained in HTSUS 7323.93.00.30 besides kitchenware and bakeware, they do not contradict the information contained in the Rushing Affidavit. It is apparent from the calculations in the affidavit that the Rushing Affidavit uses the term “bakeware” as a catch-all category. See Rushing Aff. ¶ 4. Such a catch-all category would include the various articles Chefline presents in the submitted scope reviews.

Also, according to the articles submitted with Chefline’s rebuttal comments, the bakeware industry grew between 5 and 10 percent in 1999. As a result, Chefline argues that bakeware constitutes a larger percentage of 7323.93.00.30, HTSUS, than Rushing’s estimate. These articles, however, also present data that the stainless steel cookware industry grew by as much as 15 percent. See, e.g., New NPD Hom-etrak Data Reveals Kitchenware Gains, HFN Weekly (Apr. 3, 2000), Korean Producers’ Comments (Jan. 4, 2002), Attach. 2. No comparison is contained within the articles between stainless steel bakeware and top-of-the-stove cookware; rather, the articles focus on one segment of the industry. It is plausible that even though the bakeware industry grew, the relative percentages of bakeware and top-of-the-stove stainless steel cookware remain the same. Therefore, the agency could reasonably conclude that top-of-the-stove stainless steel cookware still constitutes 97 percent of merchandise imported under 7323.93.0030, HTSUS.

Although the articles offered by Chefline demonstrate that there is another way to interpret the Rushing Affidavit, they do not contradict the evidence already on the record. As a result, it is not proper for this Court to take judicial notice of Chef-line’s rebuttal comments.

4. Conclusion Regarding Chefline’s Rebuttal Comments

There is nothing in the record to suggest that Chefline did not have every opportunity to file new factual information, pursuant to the Commission’s timeline. Here, Chefline failed to present new information during the period assigned by the Commission. Moreover, Chefline did not ask for an extension of the Commission’s schedule in order to gather information on the Rushing Affidavit. Finally, Chefline did not offer any cause or necessity for the untimeliness of its submission. The Commission’s decision to reject Chefline’s untimely submissions is therefore in accordance with law.

B. Section 1675a(a)(l)

Pursuant to section 1675a(a)(l), the Commission analyzes the likely volume, price effects, and impact of subject imports if the orders are revoked. Chefline challenges only the Commission’s affirmative determinations with respect to likely volume and price effects. Chefline also claims that the data used by the Commission in its analysis of the likely volume of imports from Korea overstates the amount of Korean subject imports.

1. Likely Volume

A) Data Issues

The imports at issue here are entered into the U.S. under 7323.93.0030, HTSUS. This provision is a basket provision, including not only top-of-the-stove stainless steel cookware but products such as stainless steel bakeware and ovenware. In the original sunset review, the Commission based its affirmative determination calculation on the quantity of subject imports. The Commission subtracted the volume of imports of cookware reported by responding firms from the total volume of imports under subheading 7323.93.0030, HTSUS, to arrive at the volume of subject imports from non-responding firms. This methodology, however, did not adjust for non-subject articles contained in the HTSUS heading and therefore overstated imports from non-responding producers. In Chefline I, this Court held that although it may be reasonable to rely on official import statistics given the lack of other data, the Commission either had to adjust the data for non-subject articles or explain the reason for its change in methodology.

The Commission then reopened the record in order to correctly adjust for the amount of non-subject articles accounted for in the official import statistics for 7323.93.0030, HTSUS. Defendant-Inter-venor Stainless Steel Cookware submitted the Rushing Affidavit, based on information compiled by CMA. See Rushing Aff. ¶ 1. The CMA compiles statistics on the size of the U.S. market for various goods, such as top-of-the-stove cookware, bake-ware (including ovenware), and kitchenware. Id. at ¶ 3. As noted above, according to the CMA’s information, stainless steel bakeware, used as a catch-all category for all non top-of-the-stove stainless steel cookware, accounted for only 2.4 to 2.9 percent of the total U.S. market for stainless steel cookware and bakeware for the years 1997 through 1999. Id. at ¶ 4. Rushing argued that

[biased on the percentage of the aggregate market for top-of-the-stove stainless steel cookware and stainless steel bakeware accounted for by stainless steel bakeware, which is less than 3 percent ... [one could] estimate that, during 1997-1999, over 97 percent of imports from Korea and Taiwan under HTSUS item number 7323.93.00.30 were top-of-the-stove stainless steel cookware.

Id. at ¶ 6.

Chefline contends that the Rushing Affidavit does not address the key remand issue — “the extent to which non-subject merchandise from Korea and Taiwan is included in the [HTSUS 7323.93.00].” Chefline’s Br. at 12. Rushing does, however, address this issue by estimating the percentage of subject merchandise included in 7323.93.00.30, HTSUS, based on data assembled from the U.S. market. Although this information does address the key issue on remand, we agree with Chef-line that Rushing makes several unsupported “assumptions.” Rushing does not explain why it is reasonable to assume that the composition of Korean imports reflects the composition of the U.S. market as a whole. Accordingly, the affidavit alone, without additional support, would not support the Commissions’ affirmative anti-dumping and countervailing duty determination. See Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168, 83 S.Ct. 239, 9 L.Ed.2d 207 (1962) (The agency must articulate a satisfactory explanation for its actions including a “rational connection between the facts found and the choice made.”).

The Commission, however, recognized the limited application of the CMA data and Rushing Affidavit. See Remand De-term. at 12 n. 33. As a result, the Commission did not rely solely on the Rushing Affidavit when deciding to adjust the official import statistics by three percent. The Commission also looked at data from the Korean Metal Ware Industry Association (“KMWIA”) to determine if it supported Rushing’s premise. Id. (