Canadian Lumber Exporter Says Subsequent Precedent Should Matter in Sunset Review

The Commerce Department arbitrarily rejected arguments from Canadian softwood lumber exporter Resolute FP Canada -- despite a "good cause" showing by Resolute -- when it found the company would be likely to continue dumping, in the final results of a sunset review, Resolute said in its Nov. 6 motion for judgment at the Court of International Trade (Resolute FP Canada v. U.S., CIT # 23-00095).

The sunset review finding relied on "the false premise that Resolute was dumping at the time of the original investigation," the company said. Resolute argued in the original investigation that it never dumped softwood lumber, and Commerce's use of the differential pricing methodology and use of Cohen's d test to find that it did has since been "discredited," so Commerce should toss the dumping finding.

Commerce never found Resolute to be dumping lumber from Canada when it applied its average-to-average methodology in the original investigation. Only when the department used the differential pricing methodology did it find Resolute to have engaged in targeted dumping. If Commerce had ceased its investigation after it used the correct method, Resolute wouldn't have been subject to the original AD order, wouldn't have requested a sunset review five years later, nor would it be appealing the result of that review to the court, it said.

Commerce's results did not show "targeted" dumping, but nothing found "natural seasonal price differences" normal for a seasonal commodity, Resolute said. "The prices were not different in the same season for Canada and the United States. They were different, as should have been expected, in different seasons in the United States."

Commerce is required to examine the dumping rates assigned to the respondents in the underlying investigations as part of its sunset reviews, Resolute said. The department has “good cause” to consider recent judicial decisions that have "upended" Commerce’s methodology, Resolute argued, pointing to Marmen v. U.S. and Stupp v. U.S.

The U.S. Court of Appeals for the Federal Circuit has raised "serious concerns" with Commerce’s use of the d test, including whether Commerce applied the test in ways compliant with the underlying assumptions, Resolute said. The court also has vacated the use of a simple, rather than weighted, average standard deviation. Together, these decisions show the unreasonableness of Commerce’s use of differential pricing, Resolute said.

Resolute was a mandatory respondent in the original AD investigation and in the first administrative review, where it received 3.2% and 1.15% dumping rates, respectively. The company wasn't picked as a respondent in the second, third or fourth reviews, but when Commerce began its expedited sunset review of the order, Resolute asked the agency to find zero likelihood of "continuation or recurrence of dumping" if the order was revoked. When Commerce denied the request, Resolute sued (see 2305090031).