Exporter Didn't Exhaust Claims on Deduction of Section 232 Duties From US Price, Petitioner Says

Japanese exporter Nippon Steel Corp. failed to exhaust its claim that Section 232 duties weren't included in the prices it charged to its unrelated U.S. buyers in a trio of the exporter's cases against three antidumping reviews of hot-rolled steel flat products from Japan, AD petitioner Nucor Corp. argued. Filing a supplemental brief to the Court of International Trade on Dec. 1, Nucor said that Nippon Steel failed to raise the argument in any of the three reviews and failed to plead the claim "with sufficiency," thereby waiving the argument (Nippon Steel Corp. v. United States, CIT # 21-00533, 22-00183, 23-00112).

The complaints in two of Nippon Steel's cases challenge the Commerce Department's deduction of Section 232 steel and aluminum duties from its U.S. price "on a purely legal basis," arguing that the deduction misconstrues the law and violates the U.S.'s international obligations. The exporter's third complaint is the only one that says Commerce "lacked substantial record evidence to support a finding that" the company's U.S. prices had the Section 232 duties. "But that complaint provides no factual detail in this regard," Nucor said.

Citing Supreme Court precedent in Bell Atl. Corp. v. Twombly, the petitioner claimed that Nucor must argue its case "with sufficient allegations" to bring the case "above the speculative level." The first two complaints "alleged no deficiency in the evidence supporting Commerce’s conclusion that NSC’s U.S. prices were duty-inclusive, and the company pled no facts that would support such an allegation," the brief said. The third complaint "pled no particular facts from which one could plausibly conclude that this was the case," Nucor added.

The petitioner also countered Nippon Steel's claims related to U.S. international obligations. U.S. law explicitly bars any company from challenging any action, or inaction, by a government agency on the ground that this action violated certain agreements, including the General Agreement on Tariffs and Trade, as Nippon Steel does, the brief said.

Nucor said Nippon Steel failed to persuade that the U.S. Court of Appeals for the Federal Circuit's decision finding that the U.S. could deduct Section 232 duties from U.S. price was wrongly decided. The Federal Circuit said that the only "fair reading" of the presidential proclamation requiring all AD duties to continue to be imposed in addition to the Section 232 duties "requires Commerce to calculate antidumping duties as if the Section 232 duties did not exist, and thus to deduct Section 232 duties from U.S. prices."

The petitioner said Nippon Steel "offers an odd, cramped reading that does not comport with normal usage." For instance, the exporter interpreted the word "applicable," read with the phrase "any other duties," to show that AD are not applicable to goods subject to Section 232 duties, "or at least not in their entirety." Nucor claimed that this is "an unwarranted denotative burden to place on a word that, naturally read, simply indicates that where antidumping or other duties are in place as to a product covered by the Section 232 duties, the Section 232 duties are to be imposed 'in addition to' those previously-existing duties."