CIT Upholds Commerce's Surrogate Financial Statement Pick in AD Investigation

Triune was tapped as the sole mandatory respondent in the investigation, and, since it didn't have any home market or third-country sales during the investigation period, Commerce had to turn to constructed value. Triune submitted the financial statements of seven companies, including TMTE, an Indian producer of comparable merchandise. Meanwhile, petitioner Edsal Manufacturing submitted the financial statements of two companies, including Mekins Industries, also an Indian producer of comparable merchandise.

Mekins' data was taken directly from the Indian government's Ministry of Corporate Affairs website, while TMTE's statements were provided to Triune by the company's owner, who agreed to provide the documents to anyone as a "public document." While the TMTE data was submitted on Oct. 2, 2023, Triune then submitted "certain factual information" on Oct. 23, 2023, in support of the claim that TMTE's statements are publicly available.

One of Commerce's regulations, 19 C.F.R. Section 351.301(c)(5), says information related to previous submissions must be filed by 30 days ahead of the investigation's scheduled preliminary determination.

Edsal challenged Commerce's ultimate use of TMTE's statements on three grounds: the additional information submitted by Triune was untimely, TMTE's statement wasn't publicly available, and the presence of countervailable subsidies in Mekins' financial statement didn't disqualify it from selection. Barnett rejected all three arguments.

Regarding the timing of Triune's submission, Edsal argued that Commerce applied the wrong standard in deciding whether to extend the deadline for submitting new factual information, adding that the agency should have considered whether "extraordinary circumstances warranted a late extension." Barnett held that Commerce didn't err by using the "good-cause standard, rather than the extraordinary-circumstance standard," since Triune never requested an extension, and the extraordinary-circumstance standard is only invoked when a party requests an extension.

The court said Commerce only had to find "good cause" to extend its regulatory deadlines, which it did here. Barnett added that the acceptance of the Oct. 23 submission wasn't "prejudicial to Edsal," since the petitioner ignores the fact that TMTE's statements were already submitted to Commerce by the earlier deadline. And while the petitioner tried to "raise speculative doubts about the public availability of the financial statements at that time," there was no record evidence to back that speculation, the judge said.

Edsal then claimed that Commerce erred by merely accepting Triune's initial claim that TMTE's statements had been filed with the Indian government, without a copy from the Indian Ministry's website. Barnett held that the agency "reasonably explained its finding in this case," which was based on Triune's claim that TMTE agreed to supply the statements to anyone as a public document. Also, the agency reasonably relied on Triune's later submission showing the public availability of TMTE's statements on the Indian government website, the court said.

Lastly, the petitioner argued that Commerce erred in treating the Mekins statements as "per se unsuitable for use to determine CV profit" based on the presence of countervailable subsidies in them. Barnett said that while the agency isn't required to reject a company's statement when it includes countervailable subsidies, Edsal's contention that Commerce rejected Mekins' statements as "unusuable, per se, is not supported by the record."

Commerce said its practice is to "reject surrogate financial statements that contain evidence of countervailable subsidies when there are other sufficient, reliable, and representative data available," the court noted. As a result, the agency "weighed other considerations before deciding if the inclusion of countervailable subsidies warranted rejection of Mekins’ financial statements." While Edsal based its challenge of TMTE's statements on their "alleged nonpublic availability," the agency addressed this concern, reasonably finding that TMTE's statements "represented a reliable alternative to Mekins’ financial statements," Barnett said.

Edsal also argued that the subsidies actually make Mekins' statements a better fit for use as CV, since Triune received similar subsidies. Barnett held that this claim doesn't alter the court's analysis, since the agency found that it was "unclear" whether Triune's subsides "were attributable to previously countervailed programs."

Dharmendra Choudhary, counsel for Triune, said he's "glad that the Court correctly affirmed Commerce’s determination that TMTE’s financial [statement] was publicly available and that it was submitted within Commerce’s extended deadline." He added that the "Court also correctly affirmed Commerce’s rejection of Mekins’ financial on the grounds of countervailable subsidies. Commerce’s decision, as affirmed by the Court, shows the importance of creating a robust record before the agency and responding to all of Petitioner’s allegations."

(Edsal Manufacturing Co. v. United States, Slip Op. 25-69, CIT # 24-00087, dated 06/03/25; Judge: Mark Barnett; Attorneys: Matthew Martin of Kelley Drye for plaintiff Edsal Manufacturing Co.; An Hoang for defendant U.S. government; Dharmendra Choudhary of Grunfeld Desiderio for defendant-intervenor Triune Technofab Private Limited)