[00:00:00] Speaker 03:
first case is prime source building product et al versus the United States in big continent steel and wire.

[00:00:08] Speaker 03:
2022, 21, 28.

[00:00:11] Speaker 03:
Mr. Senko, is it?

[00:00:13] Speaker 03:
You're going to take seven minutes?

[00:00:17] Speaker 02:
Yes, Your Honor.

[00:00:19] Speaker 03:
Well, you're going to take ten minutes.

[00:00:23] Speaker 02:
Yes, Your Honor, save three for rebuttal.

[00:00:25] Speaker 03:
Please proceed.

[00:00:26] Speaker 02:
Thank you.

[00:00:27] Speaker 02:
and good morning your honor's prime think on behalf of plaintiff appellant prime source prime source is an importer of steel nails from taiwan

[00:00:35] Speaker 02:
The anti-dumping duties on our clients' imports from Lian, Chuyuan, or LC for short, increased from 2.54% on one day to over 78% the next day, nearly because these two days follow within two different periods of review.

[00:00:51] Speaker 02:
In the fourth review relevant to this appeal, Commerce selected three mandatory respondents but did not calculate a dumping margin for any of those respondents.

[00:01:01] Speaker 02:
Commerce applied the penalty AFA rate assigned to the mandatory respondents to LC, even though Commerce had just calculated it a rate of 2.5% in the preceding review.

[00:01:13] Speaker 02:
And in the current review, LC informed Commerce that it was willing and able to respond to Commerce's anti-dumping duty questionnaire.

[00:01:21] Speaker 06:
OK, that was after the deadline, right?

[00:01:25] Speaker 06:
If I understand the record correctly, that deadline

[00:01:29] Speaker 06:
were volunteering to be a voluntary respondent was December 4, 2019.

[00:01:33] Speaker 06:
Is that correct?

[00:01:35] Speaker 02:
Correct.

[00:01:36] Speaker 02:
It was after the deadline, Your Honor.

[00:01:38] Speaker 02:
But it did put itself forward.

[00:01:40] Speaker 02:
And it put itself forward immediately when it was aware that there were no mandatory respondents participating.

[00:01:46] Speaker 02:
Three days after, as soon as that final respondent dropped out, three days after, it came forward and said, we're here.

[00:01:53] Speaker 02:
We're willing to cooperate.

[00:01:55] Speaker 02:
And our dumping margin is likely

[00:01:57] Speaker 02:
much lower than this AFA rate based on the preceding rate calculated in the last review.

[00:02:04] Speaker 06:
When did your client first become aware that the AFA rate would be pulled from the first review and it would be 78%?

[00:02:16] Speaker 02:
Not our client, but LC, the importer.

[00:02:21] Speaker 02:
Yeah, apologies.

[00:02:23] Speaker 02:
So it first became aware, so there were three respondents selected.

[00:02:27] Speaker 02:
The first respondent didn't, Bonatz didn't.

[00:02:31] Speaker 06:
I understand that.

[00:02:32] Speaker 06:
When did you become aware?

[00:02:34] Speaker 06:
When did Midwest first suggest the 78% rate?

[00:02:38] Speaker 02:
The 78% had been applied in prior reviews, so you can presume that it would be applied in the fourth review when the mandatory respondents didn't cooperate, but when they actually knew for sure was the preliminary results.

[00:02:51] Speaker 05:
In the first and second reviews, that AFA rate had been applied to some of the same respondents as in the fourth review, right?

[00:03:00] Speaker 02:
Correct, yes.

[00:03:02] Speaker 02:
And the AFA rate was based on, which is critical, was based on actually information from the investigation.

[00:03:09] Speaker 02:
It didn't contain any contemporaneous data from this period of review.

[00:03:14] Speaker 05:
There wasn't any contemporaneous data, right?

[00:03:18] Speaker 02:
No, Your Honor, and that's actually sort of the key to the case.

[00:03:21] Speaker 02:
So the statute provides that commerce may use any reasonable method when all the margins are calculated based on AFA.

[00:03:31] Speaker 02:
And that puts a burden on commerce to select a method that's appropriate for the circumstances.

[00:03:36] Speaker 05:
I don't understand you below or here to be complaining about the AFA rate itself, right?

[00:03:44] Speaker 02:
No.

[00:03:44] Speaker 02:
OK.

[00:03:44] Speaker 02:
No.

[00:03:44] Speaker 02:
Not the calculation of the AFA rate.

[00:03:46] Speaker 02:
Our claim is that the AFA rate did not reasonably reflect the potential dumping margin of LC.

[00:03:53] Speaker 02:
And that is commerce's burden when it's calculating a non-selective respondents rate.

[00:03:58] Speaker 05:
Right.

[00:03:59] Speaker 05:
Correct.

[00:04:00] Speaker 05:
Well, I hear you.

[00:04:01] Speaker 05:
Now, I have one other question, which is you mentioned that LC offered to provide

[00:04:06] Speaker 05:
information on the questionnaire, but they never actually did, right?

[00:04:10] Speaker 05:
I mean, they just said, we will.

[00:04:11] Speaker 02:
Correct.

[00:04:12] Speaker 05:
But they never provided that.

[00:04:14] Speaker 05:
I mean, sometimes when parties say, oh, we're going to file an extra reply brief or something, or surreply, they'll actually attach it.

[00:04:21] Speaker 02:
Correct, Your Honor.

[00:04:22] Speaker 02:
But in Changchuhad,

[00:04:25] Speaker 02:
that that case, it's the second Cheng Tzu Ha case, it actually showed that it discussed, and this court discussed how when a respondent puts itself forward, that can serve as evidence that its dumping margin is likely lower than what... What does put itself forward mean?

[00:04:43] Speaker 02:
Saying, I'm here, I'm willing to cooperate.

[00:04:46] Speaker 06:
But if you knew that earlier, if you knew that the 78 percent rate

[00:04:50] Speaker 06:
was likely at the time when the time limit for submitting a voluntary response existed, why weren't you required at that point to say, okay, let's be a voluntary respondent because we think the 78% rate is unreasonable.

[00:05:08] Speaker 02:
At the time that the deadline to be a voluntary respondent, it didn't know that it wasn't going to get the AFA rate.

[00:05:16] Speaker 06:
Well, I thought, I thought.

[00:05:17] Speaker 02:
Apologies if I missed it.

[00:05:20] Speaker 06:
It didn't know that it wouldn't get the AFA.

[00:05:22] Speaker 06:
I thought you were saying that you could anticipate the AFA rate would be 78%.

[00:05:27] Speaker 02:
It could anticipate that the AFA rate would be 78 percent, but it couldn't anticipate that the third respondent was going to drop out.

[00:05:36] Speaker 02:
As soon as the third respondent dropped out, which meant that there weren't any mandatory respondents signifying that it likely would get the AFA rate.

[00:05:44] Speaker 02:
That's where three days later it came in and said, we're a voluntary, we're willing to cooperate.

[00:05:50] Speaker 02:
And the reason it didn't attach information is a lot of times, and it's actually the general trend, commerce doesn't accept voluntary respondents.

[00:05:58] Speaker 02:
It has to be, commerce has the discretion whether to accept or not.

[00:06:02] Speaker 02:
So, in most cases, a company will say, it's a very costly endeavor to submit all this information.

[00:06:08] Speaker 02:
So, the company will say, we're here, we're willing, please tell us whether you will accept it or not.

[00:06:13] Speaker 02:
And commerce didn't.

[00:06:14] Speaker 02:
And it had plenty of time to do so, as the preliminary results were still two months away, and the final results were still months away after that.

[00:06:23] Speaker 06:
Okay.

[00:06:23] Speaker 06:
I don't know whether this falls into your bailiwick or that of your co-counsel.

[00:06:28] Speaker 06:
My understanding is that another argument that is being made here is that under these circumstances, it was unreasonable to apply the 78% rate from the first review to the all others rate here without some contemporaneous evidence that that was a reasonable rate to use for the all others rate and that

[00:06:57] Speaker 06:
Your argument, as I understand it, is there's no contemporaneous evidence to support that.

[00:07:04] Speaker 06:
And indeed, the rates for the individual examined parties in the earlier reviews was much lower, right?

[00:07:11] Speaker 02:
Exactly, Your Honor.

[00:07:12] Speaker 02:
So because the mandatory respondents were AFA, first,

[00:07:16] Speaker 02:
point is it wasn't even necessary.

[00:07:19] Speaker 02:
It wasn't the expected method.

[00:07:20] Speaker 02:
The expected method is the weight average.

[00:07:22] Speaker 02:
Here they didn't have volume data.

[00:07:24] Speaker 02:
They didn't have any data for the mandatory respondents.

[00:07:27] Speaker 02:
So we're already in the prong of, was it any other reasonable method?

[00:07:31] Speaker 02:
And here, given that there wasn't any data on the mandatory respondents, commerce relied on a presumption.

[00:07:37] Speaker 02:
The presumption that the mandatory respondents are presumed to be representative

[00:07:41] Speaker 02:
of all exporters.

[00:07:43] Speaker 02:
A presumption is an evidence.

[00:07:45] Speaker 06:
Here, the only evidence on the record pertained to LC, which said... Well, I think you'd have a difficult problem if it was an AFA rate that had been calculated contemporaneously at the time of the fourth review, but pulling it forward from the first review resulted in an all-other rate of 78%, whereas contemporaneously in the first review,

[00:08:11] Speaker 02:
the uh... all of this rate was about half that correct exactly around it was two point it was even less it was two point one six was the original all this rate calculated the investigation the so that's a favorite was applied in the first review but it actually comes from data that the petitioner put on the record in the investigation running out of time into a bottle tonight finish answering their honest question so

[00:08:40] Speaker 02:
You have information from the third review that was 2.54% for LC.

[00:08:48] Speaker 02:
Then you have the current review, LCs were willing to cooperate.

[00:08:53] Speaker 02:
Commerce simply said the mandatory respondents are presumed to be representative, which is not substantial evidence to show that it reasonably reflected LC's rate when you're relying on data all the way back from the investigation.

[00:09:06] Speaker 02:
compared to data from the third review and fourth review.

[00:09:09] Speaker 05:
Does the commerce actually look at prior rates that were applied in prior review periods to try to discern whether there were any trends that would show that the AFA rate would be not commercially realistic?

[00:09:27] Speaker 05:
Yeah, it's not like they just apply.

[00:09:29] Speaker 05:
You said they just applied the presumption, but I read their opinion is doing much more than that, actually.

[00:09:33] Speaker 02:
They did look at past rates, Your Honors, but those rates don't pertain to LC.

[00:09:37] Speaker 02:
And that's why our appeal is focused on LC.

[00:09:40] Speaker 02:
Those rates pertain to other mandatory respondents.

[00:09:43] Speaker 02:
And to your point, they said that there was a trend of non-cooperation.

[00:09:47] Speaker 02:
We discussed this in our brief on page 39 of our opening brief, how

[00:09:52] Speaker 02:
In actuality, they've calculated rates for the mandatory respondents in more instances.

[00:09:58] Speaker 02:
And the other point Commerce made was they said that there's a trend of increasing rates.

[00:10:03] Speaker 02:
Well, the trend of increasing rates is kind of a trick in numbers.

[00:10:07] Speaker 02:
You have a 6.16 to 27.69 for Uniketch.

[00:10:12] Speaker 02:
Again, Uniketch, not LC.

[00:10:14] Speaker 02:
And that, they said, was a significant increase.

[00:10:16] Speaker 02:
But even a 20.769 compared to a 78%,

[00:10:21] Speaker 02:
That's a huge increase, again, especially when LC, who before had 2.16.

[00:10:26] Speaker 02:
In the third review, it was selected as a mandatory.

[00:10:30] Speaker 05:
What is your view of the Court of International Trade's emphasis on who has the burden here?

[00:10:36] Speaker 02:
Sure.

[00:10:37] Speaker 02:
So the burning question gets to what evidence is on the record.

[00:10:43] Speaker 02:
And we would argue the burden is on commerce to show that its rate reasonably reflected the dumping margin of LC.

[00:10:51] Speaker 02:
And that comes from the statute's reasonability requirement that it has to select a reasonable method.

[00:10:57] Speaker 02:
And also, again, this wasn't even the expected method, Your Honor.

[00:11:01] Speaker 02:
So no parties really disagreed, since they weren't taking a weighted average, or under the third tier, any reasonable method.

[00:11:08] Speaker 02:
And under the SAA, the SAA provides that any reasonable method you have to, it has to reflect the potential dumping margin.

[00:11:17] Speaker 02:
And no party really disagrees on that point.

[00:11:20] Speaker 03:
Council, you used all the time that's been allocated, which indicates, shows the

[00:11:27] Speaker 03:
Sometimes I'm a wisdom of splitting time.

[00:11:30] Speaker 03:
We'll give you one minute for the bottle.

[00:11:33] Speaker 03:
We'll hear from this later.

[00:11:36] Speaker 02:
Thank you.

[00:11:36] Speaker 02:
Thank you, Your Honor.

[00:11:54] Speaker 04:
Good morning.

[00:11:55] Speaker 04:
My name is Kelly Slater.

[00:11:56] Speaker 04:
I'm with Appleton Left Law Firm.

[00:11:58] Speaker 04:
And I appear today on Asagi Day on behalf of the Taiwanese plaintiff appellants.

[00:12:04] Speaker 04:
Now, I was wondering if the court would like me to list all the names for the record.

[00:12:09] Speaker 04:
OK.

[00:12:11] Speaker 04:
Just wanted to make sure.

[00:12:12] Speaker 04:
I'd like to thank the court for the opportunity to appear today.

[00:12:15] Speaker 04:
I'm here on behalf of a handful of companies who are cooperative, separate rate respondents.

[00:12:21] Speaker 04:
and the underlying commerce proceeding involving steel mills.

[00:12:26] Speaker 06:
Your argument is that using the 78 percent AFA rate as the all others rate is unreasonable under these circumstances, correct?

[00:12:36] Speaker 04:
Yes, your honor.

[00:12:37] Speaker 06:
And it's unreasonable because what?

[00:12:41] Speaker 06:
It's inconsistent with the all others rate that was applied in the earlier proceeding and inconsistent with the individual examiner rates?

[00:12:51] Speaker 04:
That is correct, Your Honor.

[00:12:56] Speaker 04:
We also are taking the position that based on the spirit of the law in the Tariff Act of 1930 with respect to separate rape respondents, the statute encourages cooperation.

[00:13:11] Speaker 03:
Spirits don't come so much when you've got legislation, statutes, and procedures.

[00:13:21] Speaker 04:
True, but the statute does encourage cooperation through the calculation of actual rates based on actual data.

[00:13:30] Speaker 06:
Okay, but I think what Commerce is saying is that, first of all, we can ignore the individual examined rates.

[00:13:39] Speaker 06:
That may be questionable, but let's put that aside for a moment.

[00:13:43] Speaker 06:
They're saying you had the opportunity to submit data for the record

[00:13:48] Speaker 06:
that would show that using the 78 percent rate as the all others rate was unreasonable and you didn't submit such data, you only relied on the individual examined rates from prior proceedings.

[00:14:04] Speaker 06:
What's the answer to that?

[00:14:10] Speaker 04:
I'm not sure I understand the question.

[00:14:12] Speaker 06:
I think what commerce is saying is if you wanted to show that using the

[00:14:17] Speaker 06:
78% rate as the all others rate was unreasonable.

[00:14:22] Speaker 06:
You should have submitted data in the record to support that position and that you didn't do that.

[00:14:30] Speaker 06:
And other than pointing to the calculated rates for other parties in past review periods.

[00:14:38] Speaker 06:
So what's the answer to that?

[00:14:40] Speaker 06:
They say you should have put in

[00:14:42] Speaker 06:
more information.

[00:14:44] Speaker 06:
I don't know what the deadline for that was.

[00:14:47] Speaker 06:
I guess it was 30 days before the preliminary review, right?

[00:14:54] Speaker 04:
to qualify for voluntary respondent status.

[00:14:58] Speaker 06:
Well, we're not necessarily talking about that.

[00:15:00] Speaker 06:
That would be one thing that could be done, would be to volunteer for voluntary respondent status.

[00:15:05] Speaker 06:
But I think, as I understand what Commerce is saying, they're saying you could have also put in other data to show that this 78% rate shouldn't be applied as the whole others rate.

[00:15:17] Speaker 06:
Right?

[00:15:18] Speaker 04:
Well, I'm not quite sure what that data would be, Your Honor.

[00:15:22] Speaker 04:
because we did argue on behalf of Taiwan respondents that the actual calculated rates in prior reviews could serve as a valid factual substantial evidence-based standard for applying the all others rate in the 2018-2019 review.

[00:15:50] Speaker 04:
That data is a matter of public record and I believe we indeed did argue at commerce level that that would be a more appropriate means for treating the cooperative Taiwan respondents in the 2018-2019 review.

[00:16:04] Speaker 05:
Is it appropriate for an appellate court to look at whether what is the more appropriate way to

[00:16:12] Speaker 05:
determine, you know, determine the expected rate.

[00:16:15] Speaker 05:
I mean, I'm just having a hard time with the way you're arguing this in the sense that, you know, we're reviewing this for substantial evidence, and it's not what is the best way to do it or what is a more appropriate way to do it.

[00:16:27] Speaker 05:
It's is there substantial evidence to support the way commerce did it, right?

[00:16:32] Speaker 05:
And is the way commerce did it appropriate under the statute?

[00:16:36] Speaker 05:
So what is your legal argument or your substantial evidence argument for why commerce didn't get it right here?

[00:16:47] Speaker 04:
I'm running out of time.

[00:16:58] Speaker 03:
If you have time to answer the question.

[00:17:00] Speaker 04:
Okay, thank you.

[00:17:05] Speaker 06:
The argument is that the individual examined rates throughout the proceeding were far lower than the 78% rate.

[00:17:11] Speaker 06:
That's basically the argument you're making, isn't it?

[00:17:15] Speaker 04:
I'm sorry, I didn't hear you.

[00:17:17] Speaker 06:
Basically, the argument you're making is that the individually examined rates throughout the proceeding were substantially lower than the 78% rate, making it unreasonable to apply the 78% rate as the all others rate.

[00:17:32] Speaker 06:
Correct.

[00:17:33] Speaker 04:
Correct.

[00:17:33] Speaker 06:
And that's basically the sum and substance of it, right?

[00:17:37] Speaker 04:
Correct.

[00:17:38] Speaker 04:
And also, the language of 19 U.S.

[00:17:40] Speaker 04:
Code 1673 DC 5A mandates the exclusion of zero de minimis and tax-available margins in calculating the all-others rate.

[00:17:49] Speaker 04:
But that's not what commerce did here.

[00:17:52] Speaker 04:
They applied a punitive adverse tax-available rate to the all-others

[00:17:59] Speaker 04:
separate rate respondents.

[00:18:00] Speaker 04:
What about the exception?

[00:18:02] Speaker 05:
What about the exception under Part B?

[00:18:08] Speaker 04:
Okay, so Part B talks about any reasonable method to establish an estimated all-others rate and we think... It says including averaging the estimated weighted average jumping margins.

[00:18:20] Speaker 05:
I mean, it includes looking at AFA, right?

[00:18:27] Speaker 04:
AFA is a punitive rate that is applied to non-cooperative respondents under the statute.

[00:18:36] Speaker 04:
All right.

[00:18:37] Speaker 05:
I was reading Part B of the statute as saying is they are allowed to look at the minimus margins in AFA as part of the average.

[00:18:52] Speaker 04:
Under Part A, no.

[00:18:54] Speaker 05:
But under Part B, yes.

[00:18:56] Speaker 04:
under Part B, any reasonable method.

[00:19:00] Speaker 04:
And we contend that it's not reasonable to apply punitive rates, normally applied to non-cooperative respondents, to cooperative respondents.

[00:19:25] Speaker 01:
May it please the court?

[00:19:26] Speaker 01:
This court should affirm because the trial court correctly sustained Congress's calculation of the all others rate in which Congress adhered to the expected method.

[00:19:35] Speaker 06:
Let me tell you what my problem is here.

[00:19:39] Speaker 06:
Under the statute, it is true that you could pull the all others rate forward from the first review, the 78% rate.

[00:19:50] Speaker 06:
And perhaps the party should have anticipated that that was a possibility.

[00:19:55] Speaker 06:
But the difficulty that I have is that at the same time you're pulling it forward that rate, you don't do anything with the all others rate that was calculated for the same period of review, which was 35%.

[00:20:10] Speaker 06:
And it seems to me that there's a real question as to whether it's reasonable to pull forward the 78% rate but not pull forward the all others rate that was used contemporaneously in that earlier proceeding.

[00:20:26] Speaker 06:
And it may be that it would be reasonable to use a 78% all AFA rate for the all others rate if there had been some contemporaneous evidence in the fourth review that that was reasonable.

[00:20:43] Speaker 06:
But there's no contemporaneous evidence that that was a reasonable rate to apply to the all others rate.

[00:20:48] Speaker 06:
So you're using past data.

[00:20:51] Speaker 06:
for the EFA rate, but not past data for the all others rate, which was calculated at the same time.

[00:20:58] Speaker 06:
Why is that reasonable?

[00:21:00] Speaker 06:
That's my question.

[00:21:02] Speaker 01:
Well, a few answers to that.

[00:21:04] Speaker 01:
The first is that this court did state in Albemarle specifically that it's disfavored for commerce to generally pull forward rates, but it's also specifically stated that commerce can pull forward an AFA rate.

[00:21:15] Speaker 06:
That's absolutely true, and nobody is questioning that they could pull forward the AFA rate from the first proceeding.

[00:21:22] Speaker 06:
But what's problematic is that you're applying that rate as an all others rate, whereas in the past the all others rate was only 35%.

[00:21:31] Speaker 06:
And there's no contemporaneous evidence that the 78% was a reasonable rate to apply to the all others rate.

[00:21:41] Speaker 06:
That's the difficulty I see.

[00:21:43] Speaker 01:
Well, I think what's important here in that case is that not only can you pull forward an AFA rate as the AFA rate, then what happens is that SAA, as Judge Soll pointed out, specifically countenances the use of the AFA rate in putting together the all others rate, assuming that there is no non-zero calculated rate on the record.

[00:22:06] Speaker 01:
So the expected method.

[00:22:07] Speaker 06:
But I don't think you're responding to my question, which is that that may, in general, be appropriate.

[00:22:13] Speaker 06:
In general, the AFA rate is a contemporaneously calculated rate.

[00:22:18] Speaker 06:
Here it's not.

[00:22:19] Speaker 06:
You're reaching back for the first review and saying, okay, we're going to use 78% as the AFA rate.

[00:22:26] Speaker 06:
Wow, no problem with that.

[00:22:27] Speaker 06:
But what's the basis for then using that AFA rate for the all others rate when the all others rate in the past was half that?

[00:22:38] Speaker 01:
The basis for using that rate as the all-others rate is that all the mandatory respondents on this contemporaneous review got that 78% AFA rate, which is not in question.

[00:22:52] Speaker 01:
And then the SAA says that the expected method in that case is to weight average all the mandatory respondents' rates, whether those are AFA.

[00:23:01] Speaker 06:
You're just not responding to my question, which is,

[00:23:05] Speaker 06:
It may be that it's common and reasonable to apply the AFA rate as the all-others rate.

[00:23:14] Speaker 06:
But I'm saying this is a unique, or perhaps not unique, but a situation in which you're pulling forward that rate from the earlier proceeding, but not pulling forward the all-others rate.

[00:23:26] Speaker 06:
which was also calculated in the earlier proceeding, that seems to be inconsistent.

[00:23:32] Speaker 06:
What's the justification for doing that under the circumstance?

[00:23:37] Speaker 01:
Because there was no cause for Commerce to pull forward that 35% all others rate from the first period of review, that rate was calculated using an average of the de minimis and AFA rates in the first review, and it resulted in a 35% rate.

[00:23:52] Speaker 01:
That was in accordance with the expected method, what Congress foresaw and presumed would happen.

[00:23:57] Speaker 01:
Here, commerce also used the expected method.

[00:24:00] Speaker 01:
The only way that commerce would potentially look and pull forward a rate is if it determined that use of the expected method was not warranted.

[00:24:09] Speaker 01:
Here, it looked at the history of rates on the proceeding, which this court did countenance in the Boson case from a couple years ago, and it found that there was a history of non-cooperation, history of AFA rates in the proceeding.

[00:24:22] Speaker 06:
But all the individually calculated rates from all these periods are far lower.

[00:24:27] Speaker 06:
than the 78% rate?

[00:24:29] Speaker 01:
The individually calculated rates are lower, and they range from, I think, around 2% to 28%.

[00:24:36] Speaker 01:
But again, the all-others rate is supposed to be calculated according to the expected method, unless there is substantial evidence that shows that the expected method would not be reasonably reflected.

[00:24:48] Speaker 01:
And Commerce found reasonably in this case that that's not the case.

[00:24:53] Speaker 01:
They found that looking at the history of rates on the proceeding, you can't just look at the calculated rates.

[00:24:58] Speaker 01:
You have to include the AFA rates in your calculation of this because the mandatory respondents are presumed to be representative.

[00:25:06] Speaker 01:
And if there is a history of non-cooperation by the mandatory respondents in this review, then as the trial court correctly held, you can't simply ignore that and only cherry pick the data that favors their argument.

[00:25:18] Speaker 06:
Well, that's not, it seems to me, what the issue is.

[00:25:21] Speaker 06:
The issue is you pluck the rate from the earlier proceeding as the AFA rate at 78%, but you don't pull forward the all others rate from that very same earlier proceeding, which is half of the 78%.

[00:25:38] Speaker 01:
Well, again, commerce's practice is not to pull forward rates as a general practice.

[00:25:44] Speaker 06:
And I think this court... Why, if it's pulled forward one rate, shouldn't it pull forward the other rate?

[00:25:49] Speaker 01:
Well, for one, Albemarle does have the specific exception for pulling forward AFA rates and specifically disfavors, generally pulling forward rates.

[00:25:58] Speaker 01:
But also, the AFA rate, it's not just pulling it forward.

[00:26:02] Speaker 01:
It pulled it forward for the mandatory respondents.

[00:26:04] Speaker 01:
For the all others rate, what it did was use that AFA rate that was assigned to the mandatory respondents and use the expected method by weight averaging those rates to come up with the all others rate.

[00:26:15] Speaker 01:
So it didn't simply take the AFA rate from the petition that was corroborated in the first review and pull it forward and say, hey, that's the all others rate.

[00:26:24] Speaker 01:
It assigned that 78% rate to two different non-cooperating respondents, and there's no question that they didn't cooperate, and then said that

[00:26:33] Speaker 01:
Congress expects us to weight average the de minimis, zero, and AFA rates.

[00:26:38] Speaker 01:
And that's what they did here.

[00:26:39] Speaker 01:
There just weren't any zero and de minimis rates on the record.

[00:26:42] Speaker 01:
And then what they did was use that expected method, looked at the party's arguments that the history of rates on the proceeding shows that the AFA rate, the 78% rate, wouldn't be reflective, and disagreed.

[00:26:55] Speaker 01:
And the trial court correctly agreed with that.

[00:26:57] Speaker 01:
I'd just like to hit one more point before I turn it over to Mr. Gordon, and that's Mr. Senko's new argument that commerce did not in fact use the expected method.

[00:27:08] Speaker 01:
Time Source specifically said in its brief at page 36, for example, that commerce used the expected method, and now it's saying that commerce didn't actually use it, and therefore we're under any other reasonable method.

[00:27:19] Speaker 01:
A rubric that's simply not true and it's not consistent with what they said and the court should not countenance an argument made for the first time, I think, in its reply.

[00:27:29] Speaker 06:
Okay, so what's the evidence that Congress relied on in using the 78% rate from the earlier proceeding and applying it as the oldest rate here?

[00:27:41] Speaker 06:
What evidence supported that?

[00:27:42] Speaker 06:
You keep talking about, well,

[00:27:44] Speaker 06:
that was permitted under the statute.

[00:27:47] Speaker 06:
The statute, of course, doesn't contemplate that exact situation that it's pulling forward the rate and applying it to, as the all others rate in the current proceeding.

[00:28:00] Speaker 06:
What's the justification for using that rate and not looking at any contemporaneous data for all others' respondents?

[00:28:13] Speaker 01:
Well, its justifications were multiple.

[00:28:17] Speaker 01:
First, it adhered to what Congress expected.

[00:28:20] Speaker 01:
Second, it used that rate as the AFA rate and looked at the history of rates on the proceeding.

[00:28:26] Speaker 01:
And this court stated in the Boson case, and the trial court also countenance, that looking at the history of rates on the proceeding is a valid way to determine whether a rate is reasonably reflected.

[00:28:37] Speaker 06:
The rates in the proceeding were all hugely lower than the 78% rate.

[00:28:42] Speaker 01:
They weren't, though.

[00:28:43] Speaker 01:
Only the calculated rates were lower, but Prime Source and Cheng-Chi want to cherry pick and ignore the AFA rates on the proceedings, but Congress specifically... Are you saying that we're justified using the 78% rate because we used the 78% rate in the past?

[00:29:01] Speaker 06:
That doesn't seem to be right.

[00:29:03] Speaker 01:
Well, and also as, you know, first it was expected and there were a history of AFA rates on the proceeding.

[00:29:09] Speaker 01:
And finally, I think as Your Honor pointed out regarding LC, LC and any other non-selected respondent had the opportunity to put information on the record of this contemporaneous review to show that they didn't think that the mandatory respondents rates or that the AFA rate

[00:29:26] Speaker 01:
would be representative.

[00:29:28] Speaker 01:
They had this opportunity to do so.

[00:29:29] Speaker 01:
It's the respondent's burden to build the record.

[00:29:32] Speaker 01:
And so to the extent that there isn't contemporaneous data on this review, other than the all others rate and other than the history of rates on the proceeding, that's something that the non-examined respondents could have done something about in a timely manner and chose not to do.

[00:29:45] Speaker 01:
I'll leave the rest of my time to Mr. Gordon.

[00:29:48] Speaker 01:
Thank you.

[00:29:50] Speaker 03:
Thank you.

[00:29:58] Speaker 00:
Good morning, Your Honors.

[00:29:59] Speaker 00:
Adam Gordon with the Bristol Group on behalf of Mid-Continent Steel and Wire.

[00:30:03] Speaker 00:
I'd like to pick up where Ms.

[00:30:04] Speaker 00:
Bay left off.

[00:30:05] Speaker 00:
In response to your question, Judge Dyke, what was the basis for using the 78% rate in here?

[00:30:12] Speaker 00:
The basis is on the record of this actual view.

[00:30:15] Speaker 00:
You had one respondent, Bonuts, who never responded at all.

[00:30:19] Speaker 00:
You had another respondent, PT, who said, we're not going to participate.

[00:30:23] Speaker 00:
So there you have

[00:30:24] Speaker 00:
Complete justification because you're a complete failure to cooperate in response to commerce's selection of these companies as mandatory respondents That be that justifies unquestionably the use of the adverse facts available rape not nobody's contesting

[00:30:39] Speaker 00:
I know, but this is an important point, because the source of that rate isn't just the first review.

[00:30:44] Speaker 00:
The 78% rate is the petition rate.

[00:30:47] Speaker 00:
That was the rate alleged in the petition that was corroborated during the investigation, re-corroborated in the first review.

[00:30:53] Speaker 06:
OK.

[00:30:53] Speaker 06:
And at the time of the initial proceeding, the all others rate was 2%.

[00:31:00] Speaker 00:
In a market economy investigation and in market economy proceedings, the all others rate is recalculated in every segment, every review.

[00:31:09] Speaker 00:
And so commerce wasn't pulling the 78% rate from the first review.

[00:31:13] Speaker 00:
It was basing that 70% on the statutorily authorized source of adverse facts available, which was the petition rate.

[00:31:23] Speaker 00:
So it's very important to keep that in mind.

[00:31:25] Speaker 00:
That actually, I think, that actually sheds light on your comment about why didn't they pull the low all others rate from the first review.

[00:31:34] Speaker 00:
They're not pulling the AF rate from the first review.

[00:31:37] Speaker 00:
It's corroborated there.

[00:31:38] Speaker 00:
But actually, the source of that is the petition, not the first review.

[00:31:44] Speaker 06:
And to your point about why didn't they pull... Sorry, sir.

[00:31:50] Speaker 00:
But that's not the point of this rate.

[00:31:52] Speaker 00:
This is an adverse facts available rate, not punitive as counsel would.

[00:31:57] Speaker 00:
It's a big number, but that is not punitive as a matter of law.

[00:32:00] Speaker 00:
It's intended to induce future cooperation, and I think it's very relevant to note that in the course of this proceeding, the record is littered with non-cooperative respondents, probably more than I've ever seen in my career.

[00:32:12] Speaker 00:
And there's a legally authorized, a legally sanctioned idea that a respondent who knows the consequences of not cooperating would cooperate unless not cooperating is in their interest.

[00:32:23] Speaker 00:
Why, for example, would PT say, we're not going to cooperate in this review if they knew they're going to get the 78% rate, which is something that all the respondents would know.

[00:32:32] Speaker 00:
They have experienced counsel.

[00:32:33] Speaker 00:
They've been around the block.

[00:32:34] Speaker 00:
They can inform their clients of what's going to happen.

[00:32:36] Speaker 00:
It's well known because that rate has been used multiple times.

[00:32:41] Speaker 00:
If I may, I'd like to shift gear and pick up on another point Ms.

[00:32:44] Speaker 00:
Bae picked up on, which is counsel's argument that commerce isn't using the expected method here.

[00:32:52] Speaker 00:
And they're not using it, they say, because they didn't have any information on the record to conduct a weighted average of the margins.

[00:32:59] Speaker 00:
It doesn't matter.

[00:33:00] Speaker 00:
That's a red herring.

[00:33:01] Speaker 00:
All the companies lawfully receive a 78% rate.

[00:33:04] Speaker 00:
It doesn't matter what the volume of the imports would have been.

[00:33:06] Speaker 00:
No matter how you weight average it or simple average it, the number is the same.

[00:33:11] Speaker 00:
So that's nothing more than a canard and should be disregarded as a basis for questioning what commerce did.

[00:33:16] Speaker 00:
In the end, commerce followed the law.

[00:33:19] Speaker 00:
If they had done anything different, I submit, they would have been in violation of the law.

[00:33:23] Speaker 00:
There's no question about assigning AFA to the two respondents who either didn't show up or said they wouldn't play ball.

[00:33:29] Speaker 00:
LC showed up late to the party after realizing that it was at risk.

[00:33:34] Speaker 00:
But then it never did what it should and never put information on the record to either support its potential request as a voluntary respondent

[00:33:41] Speaker 00:
or to demonstrate that its own experience was different.

[00:33:43] Speaker 00:
Every review stands on its own record.

[00:33:46] Speaker 00:
The fact that from day one to day two, things changed, that's the nature of these proceedings, and all the companies know this.

[00:33:54] Speaker 00:
So in the end, what Commerce did was follow the law.

[00:33:56] Speaker 00:
This is a very straightforward case, in my opinion.

[00:33:59] Speaker 00:
You had two AFA rates, and as the statute requires, and as the SAA requires, they averaged those margins.

[00:34:07] Speaker 00:
If they'd done anything different, it would have been unlawful.

[00:34:11] Speaker 00:
And as we'll see, I think, in the companion case, they, again, followed the expected method.

[00:34:15] Speaker 00:
In that case, it involved a de minimis, a zero rate.

[00:34:18] Speaker 00:
And so you got a very different outcome.

[00:34:19] Speaker 00:
But that was still following the law.

[00:34:22] Speaker 03:
Thank you, counsel.

[00:34:23] Speaker 03:
Thank you, Your Honor.

[00:34:24] Speaker 03:
Just like I want to give you two minutes.

[00:34:26] Speaker 03:
Thank you.

[00:34:33] Speaker 02:
Addressing your honest question about what is substantial evidence, substantial evidence means that what could a reasonable mind find?

[00:34:41] Speaker 02:
And here, it's simply no reasonable mind could find that on one day in the third review, you have a 2.5% rate for LC.

[00:34:50] Speaker 02:
So the next day, it went to 78%, which is a 3,000% increase.

[00:34:56] Speaker 02:
and it's simply not reasonable to assume that there was such an increase when there was no contemporaneous data on the record reflecting that rate reasonably correlated with LC's potential dumping margin.

[00:35:10] Speaker 02:
In fact, the only real record or real contemporaneous data that commerce is saying

[00:35:16] Speaker 02:
is a presumption that the mandatory respondents are presumed to be representative.

[00:35:20] Speaker 02:
But that's actually flawed and easily rebutted because one of the mandatory respondents that was selected based on its volume of shipments actually came in and said, we didn't have shipments, and commerce agreed.

[00:35:34] Speaker 02:
So you can't even assume that this presumption, which is an evidence, stands.

[00:35:39] Speaker 02:
And where the only evidence is a 2.54% to 78%, that's simply not reasonable.

[00:35:47] Speaker 02:
And unless your honors have any questions.