[00:00:01] Speaker 03:
Our next case is Corinth Pipeworks Pipe Industry SA versus United States, docket number 23-2094.

[00:01:02] Speaker 03:
Okay.

[00:01:05] Speaker 03:
Councillor Senko, you have reserved five minutes of your time for rebuttal, correct?

[00:01:08] Speaker 02:
Yes, Your Honor.

[00:01:10] Speaker 03:
And the appellees, Councillor Acres, you're going to speak for 13 minutes and Councillor Brightville for two minutes.

[00:01:20] Speaker 03:
Correct, Your Honor.

[00:01:46] Speaker 02:
Good morning, Your Honors.

[00:01:47] Speaker 02:
May it please the Court, Brian Senko on behalf of plaintiff's appellant, Corinth Pipeworks.

[00:01:53] Speaker 02:
We respectfully request that this Court remand this case back to Commerce as Commerce's application of adverse facts available was based on Commerce's own clear error.

[00:02:04] Speaker 02:
As a result of this error, Commerce reversed its methodology from calculating a 0% dumping margin for CPW and the preliminary results to relying on AFA in the final results and assigning CPW a dumping margin of almost 42%.

[00:02:20] Speaker 02:
Commerce's application of AFA was not supported by substantial evidence and not in accordance with law as both a factual and procedural matter.

[00:02:30] Speaker 02:
As a factual matter, Commerce's application of AFA against CPW was not supported by substantial evidence for two reasons.

[00:02:39] Speaker 02:
First, CPW did not withhold information as its costs fully reconciled.

[00:02:45] Speaker 03:
Just to be clear, you're not challenging any of the methodology that was used in the underlying case, correct?

[00:02:53] Speaker 02:
No, Your Honor, we actually, we are challenging the methodology.

[00:02:57] Speaker 02:
We're challenging commerce's methodology.

[00:02:59] Speaker 02:
We're challenging, and that's the heart of the issue, that commerce never disclosed that it made the... I mean, that different than, let's say, procedure.

[00:03:09] Speaker 03:
The procedure that it employed in this particular case, like its decision to go to AFA, that

[00:03:19] Speaker 03:
as opposed to any methodology it's used to calculate dumping margin.

[00:03:24] Speaker 02:
Yes, correct, your honor.

[00:03:27] Speaker 02:
We're not debating how the dumping margin is calculated.

[00:03:29] Speaker 02:
We're debating commerce's methodology to assign that dumping margin.

[00:03:35] Speaker 02:
And to your honor's point, commerce requires a cost reconciliation to verify that a respondent's recorded cost and sales are accurate and tied to its financial statements.

[00:03:46] Speaker 02:
And here, commerce departed from CPW's cost reconciliation and performed its own analysis.

[00:03:52] Speaker 06:
Can I just ask this?

[00:03:54] Speaker 06:
So one of the things, at least one of the things that I think Commerce Ed and the Court of International Trade, I think, concluded was that the manner of your presentations was

[00:04:14] Speaker 06:
left so much to be desired, was so opaque that that constituted a kind of impeding of the proceeding.

[00:04:23] Speaker 06:
So that even if somewhere in the massive material you might find all the information, that's not enough.

[00:04:34] Speaker 06:
And therefore 1677EA properly applies.

[00:04:42] Speaker 02:
Your Honor, that's rebutted by the fact that commerce itself, there can be no reasonable conclusion that CPW's reconciliation wasn't clear when commerce itself was able to get CPW's cost to reconcile, but for its clear error to twice deduct CPW's cost of semi-finished pipe.

[00:05:00] Speaker 02:
had it not made that error.

[00:05:01] Speaker 06:
But why isn't it enough to say when the respondent presents so messy a set of materials that part of what comes with that is the risk that, I'll exaggerate a little bit, after heroic efforts

[00:05:22] Speaker 06:
by commerce to figure out what the answer is to the question that it needs to ask.

[00:05:30] Speaker 06:
It gets something wrong.

[00:05:32] Speaker 06:
That's the equivalent of essentially not being given usable information.

[00:05:38] Speaker 06:
And so it comes to perhaps incorrect conclusion that there wasn't, in fact, a reconciliation.

[00:05:46] Speaker 06:
And therefore, it just can't use the costs, which I think is what happened here, right?

[00:05:51] Speaker 02:
Well, commerce

[00:05:52] Speaker 02:
Your Honor, Commerce's main stake could have been easily resolved had it followed its statutory mandate under 19 U.S.C.

[00:05:59] Speaker 02:
1677E, which is subject to the conditions of 19 U.S.C.

[00:06:04] Speaker 02:
1677MD, and provided CPW with this notice of the alleged error that Commerce identified.

[00:06:12] Speaker 06:
Except for the word obtained.

[00:06:14] Speaker 02:
That's 1677-MG, Your Honor.

[00:06:17] Speaker 06:
This is a different point?

[00:06:18] Speaker 02:
Yes, so this is 1677-E, Your Honor, is subject to the provisions of 1677-MD.

[00:06:25] Speaker 02:
I will address MG as well, Your Honor, but this is a separate statutory provision.

[00:06:34] Speaker 05:
1677-MD is the argument you did not make to the core of international trade, correct?

[00:06:38] Speaker 02:
Your Honor, we made the argument under 1677 EA that its application of AFA was not supported by substantial evidence.

[00:06:47] Speaker 02:
We clearly made that below.

[00:06:49] Speaker 02:
And then the Supreme Court has held that as long as the claim is properly presented, when it's brought up before the appellate court, the arguments don't have to be exactly the same.

[00:07:03] Speaker 06:
And so therefore, a violation of a different statutory provision.

[00:07:07] Speaker 06:
There's always a difficulty of separating new issues from new arguments in support of the same position on an already raised issue.

[00:07:18] Speaker 06:
This kind of seems like on the new issues side of the line.

[00:07:24] Speaker 02:
No, Your Honor, in that.

[00:07:25] Speaker 02:
1677EA is the preconditions that you have to apply before applying facts otherwise available.

[00:07:34] Speaker 02:
And then B is the adverse inference.

[00:07:37] Speaker 02:
And EA is subject to 1677MD.

[00:07:40] Speaker 02:
So it's subject to that provision, which provides that when commerce identifies an alleged error, in this case it was actually commerce's error,

[00:07:50] Speaker 02:
It has to provide a respondent with notice and an opportunity to comment.

[00:07:55] Speaker 02:
And the burden is on commerce to make its request clear.

[00:08:00] Speaker 02:
And here CPW had no reason to know that commerce to continue to find its reconciliation was unclear after CPW responded to the second supplemental questionnaire.

[00:08:11] Speaker 02:
And that's because

[00:08:12] Speaker 02:
CPW employed the same methodology that implied in the investigation.

[00:08:16] Speaker 02:
The record demonstrates that.

[00:08:19] Speaker 06:
Just help me understand this.

[00:08:20] Speaker 06:
I thought your first response, Commerce said, this is deficient.

[00:08:27] Speaker 06:
So we're going to give you another opportunity.

[00:08:30] Speaker 06:
At that point, isn't D satisfied?

[00:08:34] Speaker 02:
No, Your Honor.

[00:08:37] Speaker 02:
And it gets back to the Hitachi case, which quotes the SKF case, in that if commerce is going to find an error, it has to make that error clear to the respondent.

[00:08:48] Speaker 02:
So in this case, commerce provided, in the first supplemental questionnaire, it said the reconciliation was unclear, provided a template, and said that template may vary by situation.

[00:09:01] Speaker 02:
And then in the second questionnaire, supplemental questionnaire, it asks very detailed questions on CPW's reconciliation, including it asked about specific figures and specific values and why CPW reported things in the reconciliation the way it did.

[00:09:17] Speaker 02:
CPW answered all those questions.

[00:09:20] Speaker 02:
And then it didn't never disclose to CPW that it found that its cost didn't reconcile because of these double counted costs.

[00:09:29] Speaker 02:
And then CPW,

[00:09:31] Speaker 02:
It used CPW's calculation in the prelim.

[00:09:34] Speaker 02:
CPW had no reason to know as it followed the methodology from its initial investigation.

[00:09:39] Speaker 02:
And Commerce then had six months to seek further clarification from CPW, which it did not do.

[00:09:46] Speaker 02:
And it's mandated to do that both under 1677 and D, under 1677 and G. Getting to your?

[00:09:54] Speaker 06:
Does the record tell us when Commerce first

[00:10:00] Speaker 06:
completed its own effort at reconciliation and found that the numbers didn't match up.

[00:10:07] Speaker 02:
And that's the that's the whole point, Your Honor.

[00:10:09] Speaker 02:
The linchpin to commerce's analysis, its reconciliation didn't occur until the final results.

[00:10:15] Speaker 06:
And so there wasn't six months left.

[00:10:18] Speaker 06:
And I guess I'm sort of a

[00:10:20] Speaker 06:
Conjuring a scenario in which, you know, everybody at commerce is busy trying to figure out what to make of this material and nobody can figure it out.

[00:10:30] Speaker 06:
And the day before, you know, they want to complete the investigation.

[00:10:34] Speaker 06:
Somebody says, I sort of see how these things are put together and it may contain a mistake.

[00:10:40] Speaker 02:
That's still, it's still commerce's obligation once it found that mistake to bring that before CPW and give it an opportunity.

[00:10:50] Speaker 06:
It didn't find the mistake until you said, look at this, you're, you're.

[00:10:56] Speaker 02:
Your Honor, in the reconciliation chart, which was not disclosed until the final results, the whole basis of commerce's AFA was it found that there was these alleged double-counted costs.

[00:11:08] Speaker 02:
CPW's accounting system accumulates the cost.

[00:11:11] Speaker 02:
So you have bare pipe, then you have coated pipe, then you have lined pipe.

[00:11:16] Speaker 02:
And in CPW's reconciliation, it removed these double counter costs because otherwise the reported costs would be essentially inflated.

[00:11:26] Speaker 02:
Commerce, when it did its reconciliation and departed from CPW's,

[00:11:30] Speaker 02:
It made the error to twice deduct these costs.

[00:11:33] Speaker 05:
The question, I think it's similar to what Judge Toronto is asking you, is if after Congress has obtained all the information it can obtain, giving you multiple chances,

[00:11:46] Speaker 05:
It does the best it can to figure out whether things reconcile and what the right calculations are.

[00:11:54] Speaker 05:
If it makes a mistake at that last point, what is it in these statutes that gives you the right to be heard

[00:12:06] Speaker 05:
in response to that mistake that if you've been heard, you know, appropriately up until that point.

[00:12:13] Speaker 02:
Okay, so three points, Your Honor.

[00:12:14] Speaker 02:
1677A-EA, which is, as I said, 1677MD.

[00:12:19] Speaker 02:
1677MG, which says that factual aid information that commerce uses as to base its determination must be able to comment on.

[00:12:29] Speaker 05:
But that doesn't include a calculation.

[00:12:31] Speaker 02:
Your Honor, this isn't just a standard margin calculation, though.

[00:12:34] Speaker 02:
This is commerce departing from CPW's reconciliation and performing its own analysis.

[00:12:41] Speaker 02:
And that's consistent with what commerce has found both in this case.

[00:12:46] Speaker 02:
For example, commerce put a margin calculation on the record

[00:12:49] Speaker 02:
and allowed for comments after the prelim.

[00:12:52] Speaker 02:
And commerce, in other cases, is seeking a voluntary remand to allow parties to comment on information that it places on the record.

[00:13:00] Speaker 02:
And the last point, Your Honor, is that there's also persuasive case law establishing that when commerce changes its methodology between the prelim and final, that it should provide an opportunity to comment.

[00:13:11] Speaker 02:
So that's the third reason, Your Honor.

[00:13:13] Speaker 02:
And under any of those reasons, we win.

[00:13:15] Speaker 02:
And this case should be remanded back.

[00:13:17] Speaker 02:
I see I'm running up towards the end of my time.

[00:13:20] Speaker 03:
Do they have more questions here?

[00:13:24] Speaker 03:
No problem.

[00:13:25] Speaker 03:
OK, thank you.

[00:13:25] Speaker 03:
We'll restore you back to your five minutes.

[00:13:27] Speaker 03:
Thank you very much, Your Honor.

[00:13:33] Speaker 00:
Good morning, Your Honor.

[00:13:34] Speaker 00:
As it may please the court, I'll start with the argument related to 1677 M subsection G. That doesn't apply here, as Your Honor Stark noted, to commerce's calculations.

[00:13:48] Speaker 00:
That statute provides that commerce must provide an opportunity to parties to comment on information submitted

[00:13:54] Speaker 00:
to the Department of Commerce.

[00:13:56] Speaker 00:
That's precisely what happened here.

[00:13:58] Speaker 00:
After the close of the information collected before the preliminary results were issued and after, Commerce provided an opportunity for the parties to comment on the preliminary results.

[00:14:10] Speaker 00:
That was the close of the information submitted.

[00:14:13] Speaker 06:
I just want to be clear.

[00:14:14] Speaker 06:
I thought you might be saying two somewhat different things.

[00:14:18] Speaker 06:
One is calculation is not information.

[00:14:21] Speaker 06:
And the second is, even if it is, it was not obtained by commerce.

[00:14:25] Speaker 06:
It was generated in-house.

[00:14:27] Speaker 00:
That's correct, Your Honor.

[00:14:28] Speaker 00:
That's why 1677MG doesn't apply.

[00:14:32] Speaker 06:
Which one?

[00:14:33] Speaker 06:
The obtained part or the information part?

[00:14:35] Speaker 00:
Both, Your Honor.

[00:14:36] Speaker 06:
If calculation is not information, then what information did they not supply?

[00:14:44] Speaker 00:
The information that Corinth did not supply was... Was it calculation?

[00:14:49] Speaker 00:
No, Your Honor, it was the reconciliation of the costs.

[00:14:51] Speaker 00:
That was the information.

[00:14:53] Speaker 06:
Isn't that just a particular kind of calculation?

[00:14:57] Speaker 00:
It's a type of calculation.

[00:14:58] Speaker 00:
It's certainly data that commerce requested that wasn't provided to it in the form and manner of the request.

[00:15:06] Speaker 06:
If, as might well be the case, they provided every bit of raw data, but not the calculation that showed how to figure out the answer to that particular question,

[00:15:22] Speaker 06:
and you consider calculations not to be information, then they didn't fail to supply any.

[00:15:29] Speaker 00:
Well, Your Honor, commerce's calculations are not new information that's submitted.

[00:15:35] Speaker 00:
Commerce's calculations are based on the data.

[00:15:37] Speaker 06:
That's why I just want to keep straight between the two things, whether the calculation is not information or whether, even if it is, it wasn't submitted to or obtained by, I guess, both words are in 1677 MG.

[00:15:53] Speaker 00:
Our position is that calculations by commerce are not new information that fall under M.

[00:16:01] Speaker 00:
subsection G such that there has to be an additional opportunity to comment on those.

[00:16:06] Speaker 00:
That's commerce's calculations.

[00:16:08] Speaker 00:
As it relates to the application of facts available and facts available with an adverse inference, Corinth did provide a lot of data that could perhaps have underlined those calculations but didn't provide it in the form or manner requested by commerce and thus essentially made it impossible

[00:16:24] Speaker 00:
for commerce to reconcile.

[00:16:26] Speaker 00:
So sure, it did submit data in a huge voluminous data dump, but it did so in a way that significantly impeded commerce's ability to reconcile.

[00:16:35] Speaker 00:
And because it impeded commerce's ability, that warranted facts available, and because Corinth had numerous opportunities

[00:16:43] Speaker 00:
to submit in the form and manner requested and refused to do so, that demonstrated that Corinth did not act to the best of its ability.

[00:16:51] Speaker 00:
So the form and manner in which Corinth replied to the Department of Commerce is what warrants the facts available and the facts available to adverse inference.

[00:16:59] Speaker 06:
Can you remind me, do you dispute before us that Commerce made a mistake?

[00:17:06] Speaker 00:
in what regard, Your Honor, I don't believe so.

[00:17:08] Speaker 06:
About the mistake that they pointed out after the final results.

[00:17:15] Speaker 06:
The double counting.

[00:17:16] Speaker 06:
The double counting.

[00:17:18] Speaker 00:
No, we do not agree that there was a mistake there.

[00:17:20] Speaker 06:
And in fact... How was there not a mistake?

[00:17:23] Speaker 06:
I guess I'm vaguely remembering, and you'll just correct me, that the issue here was

[00:17:30] Speaker 06:
the internal carrying of costs through multiple stages, which end up having to be, if you want to have each cost counted only once, you have to keep kind of backing things out and

[00:17:46] Speaker 06:
And at least they say that there was one pretty important bit of cost that was not backed out by Commerce and that resulted in the difference between they reconcile and they don't reconcile.

[00:18:02] Speaker 00:
Sure, that's Corrid's point.

[00:18:04] Speaker 00:
Commerce's response to that is Commerce could not reconcile because the information was not submitted in the form and manner requested.

[00:18:13] Speaker 00:
Attacking sort of the substance of the attempted reconciliation is outside of the legal argument of whether commerce provided the opportunity to submit this information with our facts available.

[00:18:25] Speaker 06:
I realized I was asking a question different from what you were talking about.

[00:18:30] Speaker 06:
So let's put that aside.

[00:18:32] Speaker 06:
Does commerce have, do you have an explanation for why

[00:18:38] Speaker 06:
Corinth is wrong in asserting that there was a double counting in Commerce's calculation.

[00:18:45] Speaker 06:
I would just point Your Honor to- I don't think there was such an argument in your brief.

[00:18:49] Speaker 00:
There wasn't an argument in our brief, Your Honor, and that's because it's largely irrelevant under the legal issue that was appealed here.

[00:18:56] Speaker 00:
The Department of Commerce at Appendix 9015, I would point Your Honors to,

[00:19:03] Speaker 00:
in their final results specifically address its attempts at reconciliation.

[00:19:09] Speaker 00:
Commerce attempted to reconcile the cost data because Corinth didn't provide its own reconciliation as repeatedly requested.

[00:19:18] Speaker 00:
So commerce was going above and beyond trying to make sense of this data.

[00:19:23] Speaker 00:
The point here is that because Corinth repeatedly failed to provide the data in the form and manner requested, commerce had

[00:19:32] Speaker 00:
had essentially no ability to reconcile the data, and that's why it had to resort on facts available with an adverse inference.

[00:19:38] Speaker 00:
Now, Corinth arguing, well, you could have reconciled it this way or this way, doesn't remedy the repeated deficiencies throughout the course of the administrative proceeding of Corinth's own making.

[00:19:50] Speaker 00:
If Corinth wanted

[00:19:52] Speaker 00:
it's data to be able to be reconciled, it should have presented it in the form and manner that commerce requested.

[00:19:59] Speaker 00:
And so any sort of attempt now to say, well, commerce inappropriately or inaccurately reconciled our information, ignores that it was Corinth's responsibility to reconcile its information.

[00:20:11] Speaker 00:
It's the parties, the respondents,

[00:20:13] Speaker 00:
a job to create an adequate record and it repeatedly failed to do so.

[00:20:18] Speaker 06:
So any errors that commerce made attempting to help Corinth reconcile is separate and apart.

[00:20:30] Speaker 06:
Has this happened before or maybe just hypothetical that after commerce slaved away with all of this opaque information and you know at the end of the day, it actually sees that they reconcile.

[00:20:48] Speaker 06:
Could Commerce at that point say, never mind, the fact is you impeded the proceeding and we should not have to go through all of that effort and do all of the work that the party is supposed to do and then apply 1677 EA?

[00:21:10] Speaker 00:
I believe under the statutory language, yes, Your Honor, as long as there's a finding that there was a significant, significantly impeded the administration of the proceeding, like here.

[00:21:21] Speaker 06:
Has Congress ever done that sort of thing where it does a lot of work, far more work than it should have had to do, and concludes that, in fact, all the information

[00:21:36] Speaker 06:
here that what the reconciliation to make sure that the costs were in fact accurate.

[00:21:42] Speaker 06:
Has is there has commerce said nevertheless in that circuit or have we even addressed whether commerce can say 1677 EA still applies.

[00:21:54] Speaker 00:
I'm not aware of a case off the top of my head, Your Honor, but I imagine yes, because just because commerce can ultimately spin its wheels and come up with some sort of calculation doesn't mean that a party didn't act to the best of their ability.

[00:22:07] Speaker 00:
So commerce does go above and... I haven't even gotten to B yet.

[00:22:12] Speaker 00:
Sure, but just because, same logic, just because commerce ultimately can spend

[00:22:17] Speaker 00:
exhaustive efforts calculating the reconciliation doesn't mean that the party didn't significantly impede commerce's ability.

[00:22:25] Speaker 03:
I have a question on 1677 MG, and this is with respect to the providing the opportunity to be heard when new information is submitted.

[00:22:36] Speaker 03:
To whom does that opportunity extend?

[00:22:39] Speaker 03:
If party A is in the dumping procedure and it submits information which commerce declares that it can't use what we have here, then does that give party A the right to comment on its own information that it submitted?

[00:23:03] Speaker 00:
Yes, Your Honor.

[00:23:03] Speaker 00:
I believe that under the statute, the statutory language,

[00:23:07] Speaker 00:
Parties have a right to comment on all information that's submitted to the Department of Commerce or the administering authority before the record, once the record closes.

[00:23:17] Speaker 00:
So there is a right to comment on the factual record.

[00:23:20] Speaker 03:
In the course of a dumping proceeding, are there other phases where you can comment on the information?

[00:23:26] Speaker 03:
For example, verification comments?

[00:23:28] Speaker 00:
Correct.

[00:23:30] Speaker 00:
In this case, for example, the petitioner submitted a pre-preliminary results brief.

[00:23:37] Speaker 00:
So there's certainly opportunities throughout the proceeding.

[00:23:40] Speaker 00:
And in fact, that's a perfect example of how Corinth actually did have the ability to comment on AFA.

[00:23:46] Speaker 00:
The petitioner submitted a pre-preliminary results brief and argued to Commerce that AFA should apply.

[00:23:53] Speaker 00:
Then after the preliminary results, the petitioner submitted another case brief arguing that AFA should apply.

[00:24:00] Speaker 00:
Corinth responded in a rebuttal brief and argued why AFA should not apply.

[00:24:05] Speaker 00:
So this isn't a case where Corinth had no opportunity to comment on the application of AFA.

[00:24:10] Speaker 00:
It did so prior to the final results.

[00:24:14] Speaker 05:
Corinth cites some legislative history for 1677 MG, essentially, that someone in their position is entitled to know all the essential facts before commerce makes its final determination.

[00:24:26] Speaker 05:
I didn't see a response to that legislative history.

[00:24:28] Speaker 05:
What's your view?

[00:24:29] Speaker 00:
Sure.

[00:24:30] Speaker 00:
The legislative history generally provides that exactly that parties have an opportunity to respond to the information that's entirely consistent with the statute and entirely consistent with their argument.

[00:24:39] Speaker 00:
Commerce did provide Corinth an opportunity to respond to the factual information on the record.

[00:24:44] Speaker 00:
They did so they submitted a case brief that is separate and distinct from commerce's calculation between the preliminary and the final.

[00:24:53] Speaker 00:
And if Corinth's argument were right and parties had an opportunity to respond to any

[00:24:59] Speaker 00:
distinction between the preliminary and the final, there would be an endless cycle of comment,

[00:25:04] Speaker 00:
Commerce makes a new determination, comment, commerce makes a new determination.

[00:25:09] Speaker 00:
It's typical that commerce makes a change between the preliminary and the final and incorporates the comments that were made after the preliminary.

[00:25:18] Speaker 00:
Commerce, as your honors know, has strict statutory deadlines that it has to abide by and so it doesn't have the opportunity and it's certainly not required to permit this endless cycle of comments on its analysis.

[00:25:31] Speaker 00:
But importantly here, commerce's analysis on the reconciliation

[00:25:34] Speaker 00:
was based on the same facts and data that were already on the record.

[00:25:38] Speaker 00:
No new information was added after the preliminary results.

[00:25:43] Speaker 00:
And I'll yield the remainder of my time to Council.

[00:25:45] Speaker 03:
Thank you.

[00:25:57] Speaker 04:
Good morning, Your Honors.

[00:25:57] Speaker 04:
May it please the Court?

[00:25:59] Speaker 04:
I think the Justice Department's arguments were very well stated, and I will just reinforce that Commerce's decision to reject plaintiff's cost data and apply adverse facts available was supported by substantial evidence.

[00:26:12] Speaker 04:
It was consistent with the statute.

[00:26:14] Speaker 04:
If you look at, and the lower court properly helped us too, the plain language of 19 USC 1677 MG provides for the opportunity to comment on new factual information submitted by interested parties during a proceeding.

[00:26:30] Speaker 04:
Commerce's reconciliation table, its heroic efforts after three bites at the apple by plaintiff, is not new factual information submitted by an interested party.

[00:26:42] Speaker 05:
You, like the government, don't defend the Commerce's double counting.

[00:26:48] Speaker 05:
As the case comes to us, it looks like a pretty obvious error, recognizing we're sitting here with hindsight, et cetera.

[00:26:55] Speaker 05:
But it's a little unsettling, and you don't defend it, do you?

[00:26:58] Speaker 04:
Your Honor, I'm not a cost accountant.

[00:27:00] Speaker 04:
I looked at the exhibits that were created after the fact for the lower court and submitted for this court that were not provided during the course of the proceeding.

[00:27:08] Speaker 04:
Now, even if the Justice Department is correct, even if an error was made, the fault was entirely and the misunderstanding is entirely plaintiff's.

[00:27:19] Speaker 04:
And your honors are correct.

[00:27:21] Speaker 04:
Commerce did make heroic efforts here.

[00:27:23] Speaker 04:
The burden of creating an adequate record is on the parties, not on commerce.

[00:27:28] Speaker 04:
That's the Nanya case.

[00:27:30] Speaker 04:
And the language in the cost memo is unusually direct.

[00:27:36] Speaker 04:
Commerce undertook what it called a long and exhaustive analysis.

[00:27:41] Speaker 04:
It explained

[00:27:42] Speaker 04:
In the second supplemental questionnaire and put plain if I notice, your extensive calculation worksheets and reconciliation are difficult to interpret because of the lack of adequate descriptions.

[00:27:54] Speaker 04:
That's in the appendix at 6496.

[00:27:57] Speaker 04:
That is the problem here.

[00:27:59] Speaker 04:
And the cost reconciliation is foundational.

[00:28:02] Speaker 04:
Without it, commerce will not consider costs to be verified.

[00:28:06] Speaker 04:
You have the Hyundai case on that.

[00:28:07] Speaker 04:
You have the Protein Quilt case on that.

[00:28:10] Speaker 04:
So we ask that you affirm.

[00:28:12] Speaker 06:
Can I just ask you, I think I asked Ms.

[00:28:15] Speaker 06:
Akers, are you aware from your work in this area of a situation where

[00:28:21] Speaker 06:
the invocation of 1677EA rests only on the opacity of the material that is the impede paragraph or something, where despite that, commerce figured out an answer that was favorable to that respondent.

[00:28:46] Speaker 04:
Your Honor, I'm not aware of something exactly on point.

[00:28:49] Speaker 04:
I would point you back to the Hyundai case where there was a failure to comply with the reconciliation format and a failure to provide requested details.

[00:28:59] Speaker 04:
And that was found to be a basis for application of adverse facts available and upheld by this court.

[00:29:06] Speaker 04:
Thank you, Your Honors.

[00:29:08] Speaker 03:
Thank you, sir.

[00:29:20] Speaker 02:
Your Honor, three points.

[00:29:22] Speaker 02:
The first point and the key point that Your Honors addressed to my fellow counsel is that there wasn't a dispute that commerce made an error in this case.

[00:29:31] Speaker 02:
And that's key.

[00:29:32] Speaker 02:
And I think it's key to understand that CPW is not required to be clairvoyant.

[00:29:37] Speaker 02:
It's not required to be a mind reader.

[00:29:39] Speaker 02:
So I just want to go over the facts again.

[00:29:42] Speaker 02:
CPW submitted a reconciliation.

[00:29:44] Speaker 02:
And for Your Honor's reference, in appendix 7028,

[00:29:50] Speaker 02:
to 70234, it goes step-by-step how it reconciled its costs.

[00:29:56] Speaker 02:
And then in Appendix 7721, I want to make clear that CPW did submit a reconciliation that its costs fully reconciled.

[00:30:05] Speaker 02:
So CPW submitted that reconciliation, answered detailed questionnaires on its reconciliation, and the second supplemental questionnaire.

[00:30:14] Speaker 02:
Commerce then used its data to calculate a margin of 0% for CPW.

[00:30:19] Speaker 02:
CPW then didn't hear anything.

[00:30:22] Speaker 02:
To address counsel's point on they had an opportunity to brief it, the petitioners argued for the basis of AFA on the cost reconciliation in their pre-prelim comments, and Commerce rejected that.

[00:30:37] Speaker 02:
And then in their case brief, their arguments were substantially similar.

[00:30:41] Speaker 02:
and CPW responded to them.

[00:30:44] Speaker 02:
And again, Commerce never disclosed its own clear error to depart from the reconciliation and twice double count the costs.

[00:30:53] Speaker 02:
And that's why you were here.

[00:30:54] Speaker 02:
Had CPW disclosed that, they could have corrected Commerce's mistaken understanding.

[00:31:00] Speaker 02:
And on second point is on 1677 NG.

[00:31:06] Speaker 02:
Your honor got to the legislative history of the statute and that's directly on point.

[00:31:11] Speaker 02:
And that the legislative history makes clear that all interested parties should be informed of the essential facts and ensure that all parties have an opportunity to comment on any factual information.

[00:31:23] Speaker 06:
Has this has this come up in, you know, outside the trade context in, you know, APA world generally where an agency

[00:31:34] Speaker 06:
even does a calculation, but does some bit of reasoning that is in the final rule, for example, or other final decision that hadn't been expressed before.

[00:31:54] Speaker 06:
Is there other case law?

[00:31:55] Speaker 02:
I can't think of an exact

[00:31:57] Speaker 02:
case but it gets to the concept I think of your honor saying of due process and the fairness and equity in that.

[00:32:05] Speaker 06:
By the way does APA 554 apply here or not?

[00:32:10] Speaker 06:
You may if you don't know never mind.

[00:32:13] Speaker 02:
Generally the APA applies in these cases but it

[00:32:20] Speaker 02:
We don't, we don't always get to that.

[00:32:21] Speaker 02:
We rely on the statute, but generally, yes, the APA would apply to all of Congress's decisions.

[00:32:26] Speaker 06:
And are you familiar with any of our patent case laws?

[00:32:30] Speaker 06:
On top of my head, no.

[00:32:31] Speaker 01:
I apologize.

[00:32:35] Speaker 01:
You should be happy about that.

[00:32:40] Speaker 01:
I'm in the niche of the trade world, which is deep enough.

[00:32:45] Speaker 03:
Let's go back to this double counting error.

[00:32:47] Speaker 03:
Does it really matter in this case?

[00:32:49] Speaker 03:
Does it matter to you?

[00:32:51] Speaker 03:
Did you rely on this somehow?

[00:32:53] Speaker 02:
Rely on?

[00:32:54] Speaker 02:
I apologize.

[00:32:54] Speaker 03:
On the double counting error that you're talking about.

[00:32:58] Speaker 02:
CPW, no, the double counting error was Commerce's error, and that's the whole point.

[00:33:03] Speaker 02:
Had it been disclosed, CPW could have corrected Commerce's misunderstanding.

[00:33:08] Speaker 02:
What CPW relied on was Commerce using it, and that's why I was going through the facts, Commerce using its margin calculation, not disclosing.

[00:33:16] Speaker 02:
CPW was verified, and the initial investigation followed the same methodology.

[00:33:24] Speaker 03:
I think that's there on the alleged failure

[00:33:25] Speaker 03:
provide reconciliation costs in a certain format.

[00:33:29] Speaker 02:
It bears on that there was a reliance by CPW that it had followed Commerce's past procedures and that Commerce never directly asked it why those procedures were no longer applicable.

[00:33:41] Speaker 02:
So there was a reliance component on CPWs.

[00:33:45] Speaker 02:
And just to conclude, I see my time striping up.

[00:33:48] Speaker 02:
In sum, Commerce violated its obligation to allow CPW to comment on Commerce's new methodology, which was based on a clear error.

[00:33:56] Speaker 02:
This violation renders the final results as not supported by substantial evidence and otherwise not in court and swift law.

[00:34:03] Speaker 02:
And this court should vacate the judgment of the lower court and remand it back to Commerce.

[00:34:08] Speaker 02:
Unless you have, honors have any further questions?

[00:34:11] Speaker 03:
No, thank you.

[00:34:12] Speaker 03:
We thank all the parties for their arguments this morning and this court now stands in recess.