CIT Says Failure to Participate as Mandatory Respondent Related to NME Separate AD Rate Analysis
The Court of International Trade, in a decision made public May 29, said failing to act as a mandatory respondent isn't "unrelated to government control" for purposes of getting a separate antidumping duty rate. Judge Mark Barnett said Commerce isn't required to establish that companies are part of the Chinese government, because that is the presumption. Rather, he said, it's the companies that must show evidence if they are independent of the government.
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By failing to take part in an AD review as mandatory respondents when "reasonably requested to do so," four exporters didn't rebut the presumption of government control, the court said.
The court also held that Commerce unreasonably used the evidence it only had before it during a previous remand in considering whether to select exporter Shandong Linglong Tyre as a mandatory respondent. Barnett said Commerce unlawfully viewed there to only be "a singular respondent-selection event."
The judge said that while that may typically be true, "respondent selection occurred at various times" in the present case, requiring the agency to use additional information on the volume of certain companies' exports found on the remand record. Elsewhere in the decision, Barnett sustained Commerce's decision to decline to combine CBP data entries when determining exporter Kenda Rubber (China)'s volume of imports, and the agency's denial of a separate rate and withdrawal requests from various companies.
In the present review, the 2016-17 AD review of Chinese passenger vehicle and light truck tires, Commerce initially only picked one respondent. However, the U.S. Court of Appeals for the Federal Circuit remanded this decision, finding that the agency must use more than one respondent where multiple companies request a review (see 2208290026). CIT remanded the case after the second respondent Commerce had chosen withdrew from participation.
Barnett previously questioned Commerce's methodology for picking the second respondent, which limited the selection to companies with suspended entries and ranked the firms based on their overall import volumes. Barnett previously took issue with the exclusion of Linglong, also remanding the suit on the grounds that the four separate rate applicants -- Winrun Tyre, Linglong, Mayrun Tyre (Hong Kong) and Shandong Hengyu Science & Technology -- were prematurely denied separate rates.
The judge noted that Commerce's selection order "appeared faulty," since CBP data suggested Kenda may have more entries than Hengyu, Mayrun and Winrun. On remand, Commerce said that due to a "non-minor variation in the CBP data referencing 'Kenda Rubber,'" the agency limited the CBP data it considered in calculating Kenda's import volume. The agency also acknowledged its omission of Linglong and said, based on CBP data used in the first remand, that Linglong would have been picked before Kenda.
Commerce thus picked Linglong, since that's what it would have done had it properly considered the company on remand, though the exporter declined to participate, leaving Kenda as the second mandatory respondent.
Barnett sustained Commerce's decision from the first remand to "decline to combine CBP data entries when determining Kenda’s volume of imports." While the plaintiffs, led by importer YC Rubber Co., pointed to "later-obtained evidence" of Kenda's import volume to show it wasn't accurate, the judge said this evidence wasn't available to Commerce in the previous remand "when deciding whether the name variation was minor."
However, the judge disagreed with Commerce's continued reliance on the CBP data without aggregating entries from "Kenda Rubber" to determine if Linglong had a larger import volume than Kenda when deciding whether to pick Linglong as a respondent before Kenda. For Linglong, "the court must consider the evidence Commerce had available to it when it selected Linglong, not when it selected Kenda in the First Remand proceeding, and whether Commerce properly considered that evidence," Barnett said.
Given this "unusual case," Commerce "had additional information about the volume of Kenda’s entries and may not simply ignore it" at the time of the "most recent respondent-selection exercise," the court said.
The judge also sustained Commerce's denial of the withdrawal requests from Mayrun, Hengyu, Winrun and Linglong, which came after the 90-day deadline to file them. While the companies characterize this case as "unique" due to the significant time between the start of the review and the selection of the second respondent, the court said "those events were foreseeable consequences based on the claims made and pursued by Plaintiffs in this litigation," adding that Commerce has a clear "institutional interest in continuing the review for these parties."
(YC Rubber Co. (North America) v. United States, Slip Op. 25-64, CIT Consol. # 19-00069, dated 05/21/25; Judge: Mark Barnett; Attorneys: Ned Marshak of Grunfeld Desiderio for plaintiffs YC Rubber Co. (North America) LLC and Sutong Tire Resources Inc.; John Peterson of Neville Peterson for consolidated-plaintiff Mayrun Tyre (Hong Kong) Limited; Jonathan Stoel of Hogan Lovells for consolidated-plaintiff ITG Voma Corporation; and Claudia Burke for defendant U.S. government)