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Trade Court Upholds Decision to Include Importer's Aluminum Sheet in Scope of AD/CVD Orders

The Court of International Trade on Nov. 8 upheld a Commerce Department scope ruling that importer Valeo North America's T-series aluminum sheet is covered by the antidumping and countervailing duty orders on common alloy aluminum sheet from China. Judge Mark Barnett sustained Commerce's consideration of and weight applied to various industry evidence along with its detailed discussion of heat treatment.

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In the scope decision itself, the agency said Valeo's sheet was covered by the orders since it is a 3XXX-series core. The importer claimed that since its goods are heat-treated and not a clad product, they should be excluded from the orders. In a previous opinion, Barnett sustained the finding that Valeo's sheet is a clad product, though he sent back the matter to Commerce over the issue of heat-treatability of 3XXX-series alloys (see 2306210072).

On remand, the agency said "heat-treatment" means "solution heat-treatment" and that "heat-treatable alloy" refers to an alloy that can undergo "solution heat-treatment." Specifically, Valeo's imports undergo a combination of annealing and cold-working that didn't bar classification as a 3XXX-series alloy, ultimately finding that the goods don't undergo solution heat-treatment. Barnett found that Valeo didn't "present a cogent challenge to these findings."

Much of Valeo's argument against the remand centered on Commerce's consideration of the Teal Sheets publication from the Aluminum Association, which contains "designations and chemical composition limits for wrought aluminum and wrought aluminum alloys" registered with the Aluminum Association. The importer said the agency shouldn't have considered Aluminum Association specifications as a (k)(1) source instead of a definitional one.

The scope specifically covers common alloy sheet made from a 3XXX-series alloy "as designated by the Aluminum Association." In its remand, Commerce said that the Teal Sheets publication offered guidance on industry usage of the term "3XXX-series," since it is an "industry-specific term defined only by the industry publication." However, the term "designated" is a general term and thus frees the agency from only having to consider the Teal Sheets publication, the agency said.

While Teal Sheets does weigh in favor of finding that the orders' scope is limited to registered alloys within the four-digit designations assigned by the Aluminum Association, Commerce said the Teal Sheets publication was not dispositive of the proper scope interpretation. As a result, the agency "went on to consider" a separate rate determination in the underlying AD investigation and found that this source weighted against the Teal Sheet information. The agency said that since the (k)(1) sources and other information concerning trade usage "are contradictory and the respective weights of these sources are not sufficient to clearly demonstrate preeminence over the other available record information," the (k)(1) sources are not dispositive.

Barnett sustained the finding since it is "not the court's role to 'reweigh the evidence.'" The agency put forward a "reasoned explanation for its conclusion that the Teal Sheets was not dispositive."

Valeo also challenged Commerce's consideration of the separate rate determination in the underlying AD investigation itself, arguing that the determination is not a public document and does not lay out "ascertainable standards for scope interpretation." However, Barnett noted that "Valeo offers no reason why language in the regulation referencing 'the determinations of the [agency],' ... may not be interpreted to include a separate rate determination which formed part of the final determination in the underlying investigation." The judge added that the importer's arguments center on U.S. Court of Appeals for the Federal Circuit opinions governing mixed media analysis, which are distinct and inoperable in this context.

Lastly, Barnett ruled against Valeo's claim that the trade court's last opinion in the case "undermined the legal basis for the suspension of liquidation and collection of cash deposits for any entries that were made prior to the date on which Commerce initiated the formal scope inquiry on remand." The importer "offers no authority for the proposition that an order remanding Commerce's original scope ruling invalidates Commerce's prior instructions such that" the regulation governing the continuation of the suspension of liquidation doesn't apply.

(Valeo North America v. United States, Slip Op. 23-157, CIT # 21-00581, dated 11/08/23; Judge: Mark Barnett; Attorneys: Daniel Cannistra of Crowell & Moring for plaintiff Valeo North America; Alison Vicks for defendant U.S. government; John Herrmann of Kelley Drye for defendant-intervenors led by Aluminum Association Common Alloy Aluminum Sheet Trade Enforcement Working Group)