                                      Slip Op. 17-107

                UNITED STATES COURT OF INTERNATIONAL TRADE


 TOSÇELIK PROFIL VE SAC
 ENDÜSTRISI A.ù., AND TOSYALI DIS
 TICARET A.ù., CAYIROVA BORU ---
 SANAYI VE TICARET A.S./YUCEL BORU
 ITHALAT-IHRACAT VE PAZARLAMA
 A.S.,

                      Plaintiffs,                     Before: Leo M. Gordon, Judge

                                                      Consol. Court No. 15-00339
                      v.

 UNITED STATES,

                      Defendant.


                                    OPINION AND ORDER

[Final determination remanded.]

                                                                   Dated: August 22, 2017

        David L. Simon, Law Offices of David L. Simon of Washington, DC, argued for
Plaintiffs Tosçelik Profil ve Sac Endüstrisi A.ù. and Tosyali Dis Ticaret A.ù.; and Cayirova
Boru Sanayi ve Ticaret A.S./Yucel Boru Ithalat-Ihracat ve Pazarlama A.S. With him on
the briefs was Mark B. Lehnardt, Law Offices of Mark B. Lehnardt, of Washington, DC.

      Elizabeth A. Speck, Senior Trial Counsel, Commercial Litigation Branch, U.S.
Department of Justice of Washington, DC, for Defendant United States, argued for
Defendant. With her on the brief were Chad A. Readler, Acting Assistant Attorney
General, Jeanne E. Davidson, Director, Claudia Burke, Assistant Director. Of counsel
was Lydia C. Pardini, on the brief, and James H. Ahrens II, Attorneys, Office of Chief
Counsel for Trade Enforcement and Compliance of Washington, DC.

      Roger B. Schagrin, Paul W. Jameson, and Jordan C. Kahn, Schagrin Associates
of Washington, DC, for Defendant-Intervenor’s Stupp Corp., TMK IPSCO, and Welspun
Tubular LLC USA.

       Alan H. Price and Robert E. DeFrancesco, III, Wiley Rein, LLP of Washington, DC
for Defendant-Intervenor Maverick Tube Corp.
Consol. Court No. 15-00339                                                      Page 2



      Gordon, Judge: This action involves the U.S. Department of Commerce

(“Commerce”) antidumping duty investigation covering Welded Line Pipe from the

Republic of Korea and the Republic of Turkey. See Welded Line Pipe From the Republic

of Turkey, 80 Fed. Reg. 61,362 (Dep’t of Commerce Oct. 13, 2015) (final determination

of sales at less than fair value) (Final Determination); see also Issues and Decisions

Memorandum for Welded Line Pipe from the Republic of Turkey, A-489-822 (Dep’t of

Commerce             Oct.           13,           2015),           available           at

http://enforcement.trade.gov/frn/summary/turkey/2015-25990-01.pdf (last visited this

date) (“Decision Memorandum”).

      Before the court is the USCIT Rule 56.2 motion for judgment on the agency record

filed by Plaintiffs Cayirova Boru Sanayi ve Ticaret A.S./Yucel Boru Ithalat-Ihracat ve

Pazarlama A.S. (collectively, “Yucel”) and Toscelik Profil ve Sac Endustrisi A.S./Tosyali

Dis Ticaret A.S. (collectively, “Toscelik”). Plaintiffs Yucel and Toscelick challenge

(1) Commerce’s treatment of Plaintiffs’ duty drawback claims; and Yucel also challenges

(2) Commerce’s date of sale determination. For the reasons that follow, the court

remands the duty drawback determination for further consideration, and sustains

Commerce’s date of sale determination.

                                I. Standard of Review

      The court sustains Commerce’s “determinations, findings, or conclusions” unless

they are “unsupported by substantial evidence on the record, or otherwise not in

accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i). More specifically, when reviewing
Consol. Court No. 15-00339                                                      Page 3


agency determinations, findings, or conclusions for substantial evidence, the court

assesses whether the agency action is reasonable given the record as a whole.

Nippon Steel Corp. v. United States, 458 F.3d 1345, 1350-51 (Fed. Cir. 2006). Substantial

evidence has been described as “such relevant evidence as a reasonable mind might

accept as adequate to support a conclusion.” DuPont Teijin Films USA v. United States,

407 F.3d 1211, 1215 (Fed. Cir. 2005) (quoting Consol. Edison Co. v. NLRB, 305 U.S.

197, 229 (1938)). Substantial evidence has also been described as “something less than

the weight of the evidence, and the possibility of drawing two inconsistent conclusions

from the evidence does not prevent an administrative agency’s finding from being

supported by substantial evidence.” Consolo v. Fed. Mar. Comm’n, 383 U.S. 607, 620

(1966). Fundamentally, though, “substantial evidence” is best understood as a word

formula connoting reasonableness review. 3 Charles H. Koch, Jr., Administrative Law and

Practice § 9.24[1] (3d ed. 2017). Therefore, when addressing a substantial evidence issue

raised by a party, the court analyzes whether the challenged agency action

“was reasonable given the circumstances presented by the whole record.” 8A West’s Fed.

Forms, National Courts § 3.6 (5th ed. 2017).

                                     II. Discussion

                                  A. Duty Drawback

      Commerce requests an unopposed remand to address the issue of duty drawback.

Def.’s Resp.in Opp’n to Pl.s’ Mot. for J. Upon the Agency R., 14-17, ECF No. 43. As it is

unopposed, the court will grant the request. Accord SKF USA Inc. v. United States,

254 F.3d 1022, 1029-30 (Fed. Cir. 2001) (reviewing contested voluntary remand request)
Consol. Court No. 15-00339                                                       Page 4


(“Where there is no step one Chevron issue, we believe a remand to the agency is

required, absent the most unusual circumstances verging on bad faith”) (emphasis

added).

                                    B. Date of Sale

      Yucel challenges Commerce’s use of its regulatory presumptive invoice date for

the date of sale. The date of sale issue is one with which the court is familiar. See Yieh

Phui Enter. Co. v. United States, 35 CIT ___, ___, 791 F. Supp. 2d 1319, 1322-24 (2011)

(describing in detail Commerce’s date of sale regulation); CC Metals and Alloys, LLC v.

United States, 40 CIT ___, ___, 145 F. Supp. 3d 1299, 1305 (2016).

      Commerce “normally” uses invoice date as the date of sale. 19 C.F.R. § 351.401(i).

Commerce “may,” however, “use a date other than the date of invoice if [Commerce] is

satisfied that a different date better reflects the date on which the exporter or producer

establishes the material terms of sale.” Id. An interested party proposing something other

than invoice date must demonstrate that the material terms of sale were “firmly” and

“finally” established on its proposed date of sale. Antidumping Duties; Countervailing

Duties: Final Rule, 62 Fed. Reg. 27,296, 27,348–49 (Dep't of Commerce May 19, 1997)

(“Preamble”); see generally Yieh Phui Enter. Co. v. United States, 35 C.I.T. ___, ___,

791 F. Supp. 2d 1319, 1322–24 (2011).

      Yucel seems to believe that an interested party need only create some doubt about

when material terms are set, or raise the issue of the proper date of sale, which then

triggers some sort of burden on Commerce to then independently review each and every

sale to determine when material terms are set. See Yucel Br. at 12-13 (citing Nucor Corp.
Consol. Court No. 15-00339                                                          Page 5


v. United States, 33 CIT 207, 612 F. Supp. 2d 1264 (2009) (“Nucor”)).1 On a practical

level, this strikes the court as naïve. One wonders how Commerce could accomplish that

across all reviews or even during an individual review covering hundreds or thousands of

sales. And date of sale is just one small component in an otherwise complicated

proceeding. Here, for example, Commerce penned a 50-page Decision Memorandum

addressing 20 issues. Commerce’s date of sale regulation has efficiently avoided the

impracticality of Yucel’s approach for 20 years by squarely placing the burden on

interested parties challenging the presumptive invoice date, to remove any doubt about

when material terms are firmly and finally set, so that a reasonable mind has one, and

only one, date of sale choice. See Allied Tube & Conduit Corp. v. United States, 24 CIT

1357, 1371–72, 127 F. Supp. 2d 207, 220 (2000) (“Plaintiff, therefore, must demonstrate

that it presented Commerce with evidence of sufficient weight and authority as to justify

its [date of sale] as the only reasonable outcome.”); Yieh Phui Enter. Co. v. United States,

35 CIT ___, ___, 791 F. Supp. 2d 1319, 1322-24 (2011); CC Metals and Alloys, LLC v.

United States, 40 CIT ___, ___, 145 F. Supp. 3d 1299, 1305 (2016).

       Suffice it to say, Yucel did not do that here. During the administrative proceeding

Yucel argued that contract date was the date of sale for its two U.S. sales. Decision

Memorandum at 21-22. Problematically, one of those sales had terms (involving the

timing of the letter of credit and delivery date) that varied after contract date. Id. at 24.




1
 The court notes that Yucel fails to cite or discuss Nucor’s subsequent history, which the
court in Yieh Phui explained leaves Nucor with no persuasive weight. Yieh Phui, 35 CIT
at ___, 791 F. Supp. 2d at 1324–25 (2011).
Consol. Court No. 15-00339                                                            Page 6


Petitioners highlighted these differences, and using Yucel’s own arguments touting the

importance of the opening of the letter of credit, explained to Commerce that material

terms varied after contract date. Id. at 22-23. By emphasizing the opening of the letter of

credit as the moment at which both parties are bound to perform, Yucel unwittingly

undermined its argument that the earlier contract date was the effective date of sale.

Petitioners seized on this narrative, highlighting the variance in the letter of credit opening

date specified in the contract with when it actually occurred. Commerce reasonably

concurred with petitioners’ argument that Yucel had failed to establish contract date as

the date on which material terms were firmly and finally fixed. Id. at 24-25. Despite the

apparent reasonableness of this determination, Yucel nevertheless argues that

Commerce erred and should have conducted further analyses as to whether contract date

might have been the date of sale, Conf. Br. in Supp. of Mot. for J. on Agency Rec., ECF.

No. 33 (May 27, 2016) (“Yucel Br.”) at 12-17, or at least determined date of sale per

transaction and used contract date for one of the sales (an argument Yucel failed to

exhaust before Commerce), id. at 17-18, or that Commerce should have considered

whether the opening of the letter of credit might have been the correct date of sale, id.

at 16 n.5. Yucel also makes an argument about fluctuating exchange rates that they failed

to exhaust before Commerce. Id. at 18-21; see also Def.’s Resp. in Opp’n to Pls.’ Mot. for

J. on Agency R., ECF. No. 43 (Sept. 23, 2016) at 11, 13-14; see also Scheduling Order

at 3, ECF No. 27 (Mar. 10, 2016) (“please make sure you have exhausted your
Consol. Court No. 15-00339                                                           Page 7


administrative remedies by presenting your arguments to the agency in the first

instance.”).

       Yucel itself is apparently uncertain about when material terms were firmly and

finally fixed, arguing to the court that Commerce should have considered whether the

opening of the letter of credit was a suitable date of sale (despite no interested party

arguing for that date of sale at the administrative level). Yucel Br. at 16 n.5. Conceding

that there may be multiple possible dates of sale is a curious stance given a regulatory

standard that requires Yucel to have established one, and only one, date of sale.

Suggesting multiple possibilities, as Yucel does, just confirms for the court the abiding

wisdom of a date of sale regulation that defaults to invoice date precisely because this

sort of uncertainty and complexity is prevalent in most industries. Preamble, 62 Fed. Reg.

at 27,348–49 (“[I]n most industries, the negotiation of a sale can be a complex

process. . . . In fact, it is not uncommon for the buyer and seller themselves to disagree

about the exact date on which the terms became final. However, for them, this theoretical

date usually has little, if any, relevance. From their perspective, the relevant issue is that

the terms be fixed when the seller demands payment. . . .”).

       Yucel argues that even if Commerce correctly determined that Yucel failed to

establish that contract date was the date of sale for the transaction with changing terms,

Commerce nevertheless should have used contract date for the other transaction in which

all terms remained the same. Problematically for Yucel, during the proceeding Yucel

argued that Commerce should apply one date of sale (contract date) to both of its

transactions. Yucel did not argue or suggest that Commerce should assign date of sale
Consol. Court No. 15-00339                                                       Page 8


for its U.S. sales on a per transaction basis. The time to do so was before Commerce,

and make whatever arguments supported Yucel’s proposed per transaction approach.

Commerce could then have addressed those arguments. Because Yucel did not raise the

issue, Commerce never considered it, and the issue is not in a posture that the court can

review. This is Yucel’s fault, having failed to exhaust its administrative remedies. See

28 U.S.C. 2637(d); Boomerang Tube LLC v. United States, Nos. 2016-1554, 2016-1561,

___ F.3d ___ (Fed. Cir. May 8, 2017); Corus Staal BV v. United States, 502 F.3d 1370,

1379 (Fed. Cir. 2007). Yucel also failed to present its arguments about the fluctuating

exchange rate to Commerce in the first instance, and failed to exhaust these arguments

as well. Id.

       To prevail before the court, Yucel needed to demonstrate that it presented

Commerce with one and only one reasonable choice for date of sale—that the material

terms were firmly and finally fixed on its proposed contract date. Yucel failed to do that

here, accordingly, the court sustains Commerce’s date of sale determination.

                                     III. Conclusion

       In accordance with the foregoing, it is hereby

       ORDERED that the Final Determination is sustained as to Commerce’s date of

sale determination; it is further

       ORDERED that this action is remanded to Commerce to reconsider its treatment

of duty drawback; it is further

       ORDERED that Commerce shall file its remand results on or before November 6,

2017; and it is further
Consol. Court No. 15-00339                                                     Page 9


      ORDERED that, if applicable, the parties shall file a proposed scheduling order

with page/word limits for comments on the remand results no later than seven days after

Commerce files its remand results with the court.



                                                         /s/ Leo M. Gordon
                                                       Judge Leo M. Gordon

Dated: August 22, 2017
       New York, New York
