Challenge to Use of Statistical Test in AD Case Should Be Tossed for Lack of Injury, DOJ Argues

A challenge by mattress importers to the Commerce Department's use of a statistical test in its effort to root out "masked" dumping should be dismissed because the importers suffered no injury, the Department of Justice and antidumping petitioners said in a pair of Feb. 17 reply briefs. The Court of International Trade, DOJ and the petitioners said the test was inconsequential to the antidumping duty matter, making the challenge to it moot (Ashley Furniture Industries v. United States, CIT #21-00283).

In AD investigations, Commerce seeks to identify goods that are dumped into the U.S. market through "targeted" or "masked" dumping. Commerce typically conducts its investigations by comparing the average home market price of the good in question with its U.S. price. Exporters may work around this by dumping the goods in certain areas and selling them at a higher price in another place or time to get a non-dumped average U.S. price. To combat this, Commerce may compare the weighted average of sales in the home country to individual sales prices.

Commerce must first detect this masked dumping by gathering data on a company's export sales using a differential pricing analysis. The agency breaks down the U.S. sales data into sets based on comparable product groups. Once in the product group, Commerce then breaks that data into various subsets, including the region the U.S. sales took place, the purchasers involved in the sales and the time periods in which the sales took place. Commerce will then pick one subset as the "test group" while aggregating the remaining subset into the "comparison group." Commerce then uses Cohen's d test to determine if the test group differs significantly from the comparison group. If it does, Commerce applies a "ratio test" to see if the ratio of significantly different transactions warrants using the weighted average to individual transaction comparison.

In the AD investigation into welded line pipe from South Korea, which Ashley is contesting, Commerce conducted a d test but didn't conclude that masked dumping was occurring. This made the test moot, DOJ and petitioners said. "Although plaintiffs argue that the application of the Cohen’s d test is unreasonable because the underlying assumptions of the Cohen’s d test were allegedly not met, plaintiffs’ case brief submitted to Commerce contained no arguments regarding differential pricing or the Cohen’s d test," DOJ said.

Added the petitioners: "Ashley does not possess constitutional standing to challenge Commerce’s use of the Cohen’s d test in the underlying investigation because it cannot demonstrate that it was injured by any of those actions."