Level of Trade in US Irrelevant to Home Market Levels of Trade, Steel Pipe Exporters Argue in AD Case

The level of trade in the U.S. is irrelevant to the Universal Tube and Plastic Industries' argument that the Commerce Department incorrectly found there to be only a single level of trade in the home market in an antidumping duty case, plaintiffs led by Universal Tube argued in an Aug. 27 reply brief at the Court of International Trade. Seeing as the Department of Justice and the antidumping petitioner repeatedly raised this point to argue against Universal's position, it is unclear whether they did so to confuse the court with "irrelevant" details or just don't "understand the distinctions," the brief said (Universal Tube and Plastic Industries v. U.S., CIT # 20-03944).

The plaintiffs challenged the final results of the antidumping duty administrative review on circular welded carbon-quality steel pipe from the United Arab Emirates. In AD cases, Commerce is required to make a comparison between U.S. sales and home market sales at the same level of trade, and in this case, determined there was only one level in the UAE. Universal disputed this, declaring that it sold pipe to affiliated distributors who then resold the merchandise to unrelated customers.

Record evidence then established that the selling activities performed by the affiliated resellers were more "numerous and intense" than the selling activities performed by the producers at a less advantaged marketing stage. Universal dubbed the sales made by the plaintiffs directly to unrelated customers in the UAE as "Channel 1" sales and the sales by the plaintiffs to the affiliated resellers as "Channel 2" sales. This difference in the level of trade had an effect on the price, Universal argued in its motion for judgment (see 2105110066).

Universal further backed its argument with its reply brief to the DOJ and AD petitioner's arguments. Universal continued to argue that Commerce's determination of only a single level of trade in the UAE is not supported by enough evidence. "Neither Defendant nor Wheatland confront or challenge key aspects of Universal’s Brief wherein Universal explained how Commerce’s finding of only a single level of trade in the home market lacked a basis in substantial evidence," the brief said. Instead, both responses mischaracterize Universal’s arguments and claim that Universal is simply asking the Court to replace Commerce’s judgment with its own.

"It is well-settled that for agency action to be based on substantial evidence, the agency must explain why evidence that fairly detracts from the reasonableness of its determination is not outweighed by evidence that supports Commerce’s determination. Defendant and Wheatland address none of the record evidence highlighted by Universal that detracts from Commerce’s conclusion that all home market sales were made at the same marketing stage. Wheatland suggests that 'even the most basic review of the record reveals that Commerce did examine the proffered evidence,['] ... but provides zero citations to the record to substantiate its claim."