United States Court of International Trade

Slip Op. 20-49

Before the Court in United States v. Maverick Mktg., LLC, et. al., Slip Op. 20-49, Court No. 17-174 (April 16, 2020) was defendant’s motions for partial reconsideration of the Court’s order, denying in part and granting in part defendants’ motions to compel discovery, as well as for leave to file supplemental evidence for the motion to reconsider. Plaintiff commenced this action to recover unpaid federal excise taxes (“FET”) from defendant on tobacco products. Defendant requested the Court, pursuant to U.S. Court of International Trade Rule (“USCIT”) Rule 54(b), reconsider its decision to deny Maverick’s requests for production (“RFP”) for industry documents pertaining to cigar pricing, for production related to trademarks of nonparty companies and for government documents on affiliated nonparties. For the following reasons the Court granted defendant’s motion to supplement, and denied the motion to reconsider.

Initially, the Court granted the motion to supplement because plaintiff raised “no argument that allowing defendants to supplement their motion would be prejudicial and, further, does not persuade that the filing is barred as untimely.” Id. at 8.  “Factors a court may weigh when contemplating reconsideration include whether there has been a controlling or significant change in the law or whether the court previously ‘patently’ misunderstood the parties, decided issues beyond those presented, or failed to consider controlling decisions or data.” Id. at 5-6. The Court said in regards to the RFP “because the requested production is not relevant to the Alcohol and Tobacco Tax and Trade Bureau’s (“TTB”) assessment of defendants’ FET liability, and, to the extent that it has any relevancy, it is duplicative and unduly burdensome.” Id. at 10-11. The Court noted “the effort to retrieve and produce all these records for TTB … would take 3,800 to 4,800 person-hours at a cost of $153,446.40 to $191,808.00.” Id. at 15. As such, the motion for reconsideration was denied.

Slip Op. 20-50

Before the Court in Shenzhen Xinboda Indus. Co. v. United States, et. al., Slip Op. 20-50, Court No. 12-174 (April 17, 2020) was a challenge to Commerce’s final results in the sixteenth administrative review of the antidumping duty order covering fresh garlic from China. Plaintiff challenges, as unsupported by substantial evidence, Commerce’s selection of surrogate values (“SVs”) for plaintiff’s garlic bulb intermediate input as well as its selection of Tata Global Beverages Limited’s (“Tata Tea”) unconsolidated financial statements to calculate plaintiff’s surrogate financial ratios. For the following reasons, the Court sustained Commerce’s SV determination, but remanded for further consideration or explanation Commerce’s determinations on surrogate financial ratios.

In an antidumping proceeding, if Commerce considers an exporting country to be a non-market economy (“NME”) it will identify one or more market economies to serve as a surrogate for that NME in the calculation of normal value. Normal value is then determined on the basis of factors of production (“FOP”) from the surrogate country.  “Commerce generally selects … surrogate values that are publicly available, are product specific, reflect a broad market average, and are contemporaneous with the period of review.” Id. at 9. In this case, Commerce selected India as the surrogate country, and choose the Azadpur Agricultural Produce Marketing Committee’s Market Information Bulletin (“APMC Bulletin”) as the best available information to value plaintiff’s garlic bulb input. The Court said Commerce reasonably determined the APMC Bulletin prices are the best available information on the record because the bulletin “prices satisfy Commerce’s selection criteria as a specific, publicly available data source, reflecting a broad market average and reported exclusive of taxes and duties.” Id. at 10. In regards to the financial ratios, Commerce calculates surrogate financial ratios derived from the financial statements of one or more companies that produce identical or comparable merchandise in the primary surrogate country. Commerce is to “avoid using any prices which it has reason to believe or suspect may be dumped or subsidized.” Id. at 28. The Court said “Commerce has not adequately explained why its choice of Tata Tea’s financial statements to calculate surrogate financial ratios is reasonable in light of record evidence that suggests that the company is or may be the beneficiary of subsidies.” Id. at 29. As such the issue was remanded for further consideration.