CIT Sustains Commerce's Rejection of Exporter's Additional Cost Reconciliation Info, Use of 'd' Test
The Commerce Department properly refused to factor a company’s alleged losses related to the company's failure to convert certain expenses from U.S. dollars to Canadian dollars into the cost of manufacturing wind towers from Canada, the Court of International Trade said March 20. Antidumping duty respondent Marmen didn’t qualify for the adjustments because its exchange gains and losses were already accounted for in the antidumping duty investigation on utility scale wind towers from Canada, Judge Jennifer Choe-Groves said in an opinion.
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Choe-Groves also upheld Commerce's use of the Cohen's d test in its efforts to root out "masked" dumping. Choe-Groves said the agency addressed questions about the statistical validity of the test by using the entire population of data when using the test as opposed to just a sample.
During the investigation, Commerce questioned whether Marmen reasonably showed the costs of making and selling the wind towers. The trade court sent the issue back to the agency, where Commerce accepted most of the cost reconciliation data from Marmen. Although the agency agreed that several of the revised reconciliations were "minor errors" that did not alter the data, it rejected information on the conversion of certain expenses to Canadian dollars. Commerce said Marmen did not explain how this error related to the restated financial statements or whether it was just an adjustment brought by Deloitte, an external auditor.
Commerce said there was no evidence showing the change was not already accounted for on Marmen's books. The adjustment would just duplicate prior adjustments for exchange gains and losses. The agency pointed to evidence comparing an Excel spreadsheet in a questionnaire response with Marmen's initial questionnaire response, finding that the adjustments were already made.
Choe-Groves said "Commerce’s determination that another adjustment would be inappropriate is supported by substantial evidence,” adding that the agency didn’t “abuse its discretion by rejecting Marmen’s proposed corrective information” and said “Commerce has an interest in ensuring finality and increasing the accuracy of the calculated dumping margins."
The trade court also previously sent back the investigation to address the U.S. Court of Appeals for the Federal Circuit's questions over the Cohen's d test raised in Stupp Corp. v. U.S. (see 2107150032). The appellate court questioned whether Commerce's use of the test was valid given that it did not satisfy certain statistical assumptions, such as normal distribution and roughly equal variances. The agency said these assumptions need not be satisfied since it used the entire population of data and not just a sample. Choe-Groves found this to be a satisfactory explanation.
(Marmen v. United States, Slip Op. 23-37, CIT Consol. #20-00169, dated 03/20/23, Judge Jennifer Choe-Groves. Attorneys: Jay Campblell of White & Case for plaintiffs led by Marmen; Alan Price of Wiley Rein for defendant-intervenor Wind Tower Trade Coalition; Reginald Blades for defendant U.S. government)