                        Slip Op. No. 13-53

           UNITED STATES COURT OF INTERNATIONAL TRADE

Before: Nicholas Tsoucalas, Senior Judge
___________________________________
TIANJIN MAGNESIUM INTERNATIONAL     :
CO., LTD.,                          :
                                    :
           Plaintiff,               :
                                    :
     v.                             : Consol. Court No.: 11-00006
                                    :
UNITED STATES,                      :
                                    :
           Defendant,               :
                                    :
           and                      :
                                    :
US MAGNESIUM LLC,                   :
                                    :
           Defendant-Intervenor.    :
                                    :


                         MEMORANDUM ORDER
Held: Defendant United States is awarded $8,302.20 in combined fees
and costs, and defendant-intervenor US Magnesium LLC is awarded
$34,042.72 in combined fees and costs.
                                         Dated: April 23, 2013
     Riggle & Craven, (David A. Riggle) for Tianjin Magnesium
International Co., Ltd., Plaintiff.
     Stuart F. Delery, Acting Assistant Attorney General; Jeanne E.
Davidson, Director, Claudia Burke, Assistant Director, Commercial
Litigation Branch, Civil Division, United States Department of
Justice (Renee Gerber and Alexander v. Sverdlov); Office of Chief
Counsel for Import Administration, United States Department of
Commerce, Melissa Brewer, Of Counsel, for the United States,
Defendant.
     King & Spalding, LLP, (Stephen A. Jones, Jeffrey B. Denning,
and Taryn K. Williams) for US Magnesium LLC, Defendant-Intervenor.


     TSOUCALAS, Senior Judge:     Before the court are defendant

United States Department of Commerce’s (“Commerce”) and defendant-
Court No. 11-00006                                                 Page 2

intervenor US Magnesium LLC’s (“USM”) bills of costs, and plaintiff

Tianjin    Magnesium   International   Co.,   Ltd.’s   (“TMI”)   response

thereto.   By orders dated November 21, 2012 and December 21, 2012,

the court awarded fees and costs sua sponte in favor of Commerce

and USM on the basis of TMI’s frivolous argumentation and repeated

misrepresentations to the court.       Tianjin Magnesium Int’l Co. v.

United States, 36 CIT __, __, 883 F. Supp. 2d 1330, 1332 (2012)

(“Tianjin III”). As explained below, the court hereby limits USM’s

requested fees and costs to those charged between October 1, 2011

and May 16, 2012, reduces fees and costs associated with the oral

argument by 60%, and adjusts downward all fees awarded to reflect

average rates for attorneys in the Washington, D.C. area.            The

court awards Commerce all of its requested fees and costs.

                              BACKGROUND

     With gall typical of its submissions in this action, TMI

mischaracterizes the court’s previous order early in its response:

“The court mentions ‘intentionally fraudulent conduct’ in another

action, but states that ‘[it] is not aware of any identical

misconduct during this appeal.’”       TMI’s Resp. at 3 n.2 (quoting

Tianjin Magnesium Int’l Co. v. United States, 36 CIT __, __,         878

F. Supp. 2d 1351, 1352 (2012) (“Tianjin II”)). TMI uses this quote

to imply that the court did not identify any misconduct whatsoever.

To the contrary, as it stated in the very same sentence, the court

found “it troubling that TMI employed other tactics designed to
Court No. 11-00006                                           Page 3

mislead the court and the other parties to this action.”    Tianjin

II, 36 CIT at __, 878 F. Supp. 2d at 1352 (emphasis added).       The

docket is in fact replete with instances of TMI’s misconduct:

  !   TMI frivolously attempted to amend its complaint to
      include a challenge to Commerce’s use of “zeroing”
      despite its failure to exhaust administrative remedies.
      Specifically, TMI claimed that the holding in Dongbu
      Steel Co. v. United States, 635 F.3d 1363 (Fed. Cir.
      2011) overruled precedent that prevented TMI from
      objecting to zeroing below, thus triggering the “legal
      question” and “futility” exceptions. TMI’s Mot. Amend
      Compl. at 1–2, 14–15. In reality, nothing prevented TMI
      from objecting to Commerce’s use of zeroing below and
      there was no factual basis to support the futility and
      legal question exceptions.

  !   In its motion for judgment on the agency record, TMI
      argued that Commerce erred in calculating the surrogate
      financial ratio without being candid about its own
      failure to exhaust the claim below. See Pl.’s Mot. J.
      Agency R. at 13–24 (“Pl.’s MJAR”); Tianjin II, 36 CIT at
      __, 878 F. Supp. 2d at 1352.        Furthermore, despite
      complete and “accurate refutations from both Commerce and
      [USM]” in response, TMI continued the argument in its
      reply brief without once acknowledging the exhaustion
      issue.   Tianjin II, 36 CIT at __, 878 F. Supp. 2d at
      1352.

  !   TMI submitted supporting documents during the underlying
      review knowing that they had been falsified so as to
      obtain a lower dumping margin. Tianjin Magnesium Int’l
      Co. v. United States, 36 CIT __, __, 844 F. Supp. 2d
      1342, 1344–48 (2012) (“Tianjin I”). Nevertheless, in its
      response to USM’s motion for judgment on the agency
      record, TMI insisted that it “cooperated fully in the
      review by submitting responses to all questions . . . and
      being subject to a lengthy verification,” and that
      “[t]here is no information of record showing that the
      primary information relied on in calculating a margin was
      misleading or unverifiable in the review.” Pl.’s Resp.
      USM’s Mot. J. Agency R. at 2–6.          TMI’s argument
      significantly misrepresents undisputed portions of the
Court No. 11-00006                                                        Page 4

      record.1        See Tianjin I, 844 F. Supp. 2d at 1347–48.

  !   TMI requested an extension to respond to the remand
      results, but it did not file any comments within that
      time frame. After the court issued an order accepting
      the   remand   results,   TMI   filed  a   motion   for
      reconsideration in which it argued, incredibly, that it
      did not have an opportunity to respond. Tianjin III, 36
      CIT at __, 883 F. Supp. 2d at 1331-32.

These     are   but    the   latest   examples     of   TMI   and   its    counsel’s

obstructive behavior in trade proceedings.                 See Tianjin Magnesium

Int’l Co. v. United States, 35 CIT __, __, Slip Op. 11-17 at 10–11

(Feb. 11, 2011) (not published in the Federal Supplement) (noting

TMI’s complete failure to address an “obvious problem” with its

argument     despite     accurate     refutation    from      USM   and    Commerce);

Tianjin Magnesium Int’l Co. v. United States, 35 CIT __, __, Slip

Op. 11-100 at 2–6 (Aug. 10, 2011) (not published in the Federal

Supplement) (describing TMI’s submission of voluminous falsified

records and other intentional misrepresentations before Commerce);

Tianjin I, 36 CIT at __, 844 F. Supp. 2d at 1344–48 (describing

TMI’s submission of some of the same falsified records as those

described in Slip Op. 11-100 during the proceedings that led to the

present appeal).

      In its bill of costs, Commerce itemizes the time it “devoted

to responding to [TMI]’s argument,” which it estimates to be “40


      1
       As TMI argues, its response does parallel Commerce’s
position on the adverse facts issue. Unlike TMI, however, Commerce
did not misrepresent the record by arguing that it was devoid of
relevant fraudulent or unverifiable filings. See Commerce’s Resp.
Pl.’s & USM’s Mots. J. Agency R. at 8–9, 25–31.
Court No. 11-00006                                            Page 5

percent of the fees and costs associated with [its response] brief

and related oral argument.”    Gerber Aff. at 1–2.     Commerce also

seeks full reimbursement for fees associated with TMI’s motion to

file an amended complaint.     Id. at 2.    Commerce calculates its

requested fees based on its counsel’s placement in the “Laffey

Matrix,” id. at 2–3, which “is a chart of hourly rates for

attorneys and paralegals in the Washington, D.C. area that was

prepared by the United States Attorney’s Office for the District of

Columbia to be used in fee-shifting cases.”     Pickett v. Sheridan

Health Care Ctr., 664 F.3d 632, 649 (7th Cir. 2011).    Accordingly,

Commerce requests an award of $8,120.00 in fees and $182.20 in

costs.   Gerber Aff. at 1–3.

     USM, on the other hand, bases its request on the amounts its

attorneys and support staff actually billed.      Jones Aff. at 3.

These fees range from $150 per hour for a paralegal’s work to $645

per hour for a partner’s legal work.    USM also requests consulting

fees and costs, including those billed by a firm called Economic

Consulting Services.    Id. at 2.     USM asserts that all fees and

costs listed reflect, “[t]o the extent possible, . . . [those]

incurred addressing legal issues raised by TMI’s” misconduct,

excluding “costs and fees incurred in connection with [USM’s]

surrogate financial ratio issue[,] . . . [and] TMI’s attempt to

amend its complaint.”   Id. at 3–4.    USM thus requests $216,020.50

in combined attorney, consultant, and paralegal fees, and $1,551.93
Court No. 11-00006                                           Page 6

in costs.

       In response, TMI contends that the court lacks the authority

to tax fees and costs and that USM and Commerce fail to provide

“some linking to an action of TMI that justifies” the awards.

TMI’s Resp. at 7.    Specifically, TMI argues that it should not be

responsible for fees and costs associated with: (1) issues TMI

raised in its own complaint, since the court declined to adjudicate

those claims; (2) the proceedings on remand, because TMI “did not

then obstruct or delay the remand finding in any way;” (3) the oral

argument, because TMI did not request the hearing; and (4) claims

USM asserted independently in member case 1:11-cv-00014.     Id. at

4–7.    Outside of its general request that the court decline to

award all requested fees and costs, TMI does not provide any

calculations to aid the court in adjusting the awards.   See id. at

1–8.

                              ANALYSIS

       As a preliminary matter, “an assessment of attorney’s fees is

undoubtedly within a court’s inherent power.”    Chambers v. NASCO,

Inc., 501 U.S. 32, 45 (1991) (citing Roadway Express, Inc. v.

Piper, 447 U.S. 752, 765 (1980)).     Contrary to TMI’s suggestions

otherwise, see TMI’s Resp. at 4, such authority exists despite

separate mechanisms for imposing sanctions contained in the United

States Code and the Federal Rules of Civil Procedure.     Chambers,

501 U.S. at 45–46.    “[A] court may assess attorney’s fees when a
Court No. 11-00006                                                            Page 7

party has ‘acted in bad faith, vexatiously, wantonly, or for

oppressive reasons.’”        Id. at 45 (quoting Alyeska Pipeline Serv.

Co. v. Wilderness Soc’y, 421 U.S. 240, at 257–58 (1975)); see also

TMI’s Resp. at 4 (selectively quoting Alyeska to imply that the

American Rule always prohibits assessment of attorney’s fees under

the court’s inherent power). The court also retains the discretion

to award costs in appropriate situations. See Former Emps. of Bass

Enters. Prod. Co. v. United States, 13 CIT 372, 374 (1989) (not

reported in the Federal Supplement).

     TMI’s    repeated     efforts    —     through     counsel   —   to    obstruct

Commerce’s exercise of its statutory duties, to delay proceedings

through frivolous argumentation and filings, and to mislead the

court on material matters of fact and law constitute an intolerable

level of vexatiousness and bad faith.              See Chambers, 501 U.S. at

45–56.    Given TMI’s persistent misconduct before this Court and

before    Commerce,   an    award    of   fees    and    costs    related    to   its

problematic filings in this case is warranted and necessary to

deter additional costly distractions in future trade proceedings.

See id.

     Turning to the substance of TMI’s response, TMI first argues

that it should not be responsible for fees related to the issues

TMI raised in its complaint because “the court has not ruled on

th[ose]    issues.”        TMI’s    Resp.    at   4–6.      TMI’s     argument    is

unpersuasive.    USM and Commerce both spent considerable time and
Court No. 11-00006                                                  Page 8

resources attempting to respond to TMI’s frivolous and bad faith

arguments    regarding   its   surrogate    financial   ratio   claim.   See

Commerce’s Resp. Pl.’s MJAR at 17–19; USM’s Resp. Pl.’s MJAR at

5–11.     Those costs did not disappear when the court deferred

judgment on the financial ratio issue in the interest of judicial

economy.2    Therefore, there is no reason to subtract these fees and

costs from the requested awards.

      Second, TMI argues that it should not be taxed the fees and

costs USM incurred on remand because TMI “did not . . . obstruct or

delay the remand finding in any way.”        TMI’s Resp. at 5.   The court

agrees that fees and costs on remand are not within the ambit of

the previous orders.      Even though USM may have spent resources

during the remand proceedings addressing TMI’s vexatious and bad

faith conduct, the court’s intention is to capture only those fees

and costs resulting from the misconduct TMI committed before it.

See     Chambers, 501 U.S. at 44–45.       The same reasoning applies to

USM’s post-remand fees — as TMI did not file objections until after

USM drafted and filed its remand comments, USM’s post-remand fees

cannot be considered a direct result of TMI’s misconduct before



      2
       In fact, the court deferred judgment on the claim because
TMI’s previous fraudulent conduct before Commerce required the
court to remand with instructions to consider the application of
full adverse facts available against TMI. Tianjin I, 844 F. Supp.
2d at 1346–48. Granting TMI’s objection would have the perverse
effect of rewarding its behavior below with license to burden the
parties and the court with frivolous arguments on appeal so long as
those arguments become moot after remand. See id. at 1347–48.
Court No. 11-00006                                                        Page 9

this court. Therefore, USM’s award should be limited to those fees

and costs incurred before May 16, 2012.

       Third, TMI requests that the court subtract the fees and costs

USM and Commerce incurred in connection with the oral argument

because “TMI was not the party requesting [the] hearing.”                  TMI’s

Resp. at 7.    The court agrees that USM and Commerce did not incur

fees and costs related to the oral argument solely because of TMI’s

misconduct. However, despite the fact that TMI did not request the

hearing, both USM and Commerce did incur preparation and attendance

costs to address TMI’s own frivolous arguments as presented in its

motion for judgment on the agency record and its response to USM’s

motion. Therefore, it is appropriate to assess some portion of the

fees and costs USM and Commerce incurred in January and February

2012 to prepare for and to attend the oral argument.

       Commerce applies a 60% pro rata reduction to its fees and

costs related to the oral argument to reflect the portion of time

it estimates that it spent addressing TMI’s submissions.                  Gerber

Aff.    at   1–3.     TMI   does     not   specifically     object   to     this

apportionment, and the court sees no reason to alter it.              USM, on

the other hand, does not limit its oral argument fees and costs in

a manner that identifies TMI’s problematic motion and response.

Therefore,    in    the   interest    of   acting   “with     restraint     and

discretion,” Chambers, 501 U.S. at 44–45, the court will reduce

USM’s requested oral argument fees and costs by 60% to connect the
Court No. 11-00006                                                  Page 10

award more directly with TMI’s actions.

     Fourth, TMI argues that the court should not award fees and

costs USM incurred in asserting its own adverse facts available

claim because “[f]or that issue[,] TMI was . . . standing with

[Commerce] in support of its final results,” meaning that they “are

not traceable to TMI[’s]” misconduct.        TMI’s Resp. at 5.        To a

limited extent, this argument is also persuasive.         This action is

a consolidation of Court Nos. 11-00006, filed by TMI, and 11-00014,

filed by USM.    Had 11-00006 and 11-00014 remained separate, USM

could have filed substantially the same motion for judgment on the

agency record as it did in this consolidated action. See generally

USM’s Mot. J. Agency R. (not addressing issues raised exclusively

in TMI’s submissions to the court). Even though USM incurred these

costs as   a   direct   result of   TMI’s   fraudulent    conduct   before

Commerce, it did not expend additional resources drafting this

motion as a result of TMI’s conduct on appeal.       Nevertheless, TMI

tainted USM’s adverse facts claim as soon as it filed its response

to USM’s motion for judgment on the agency record, in which TMI

repeatedly misrepresented the facts and controlling law.         The fees

and costs USM incurred drafting its reply brief therefore are

connected to TMI’s misconduct before this court.         Accordingly, the

court will subtract the fees and costs USM incurred up to and

including the filing and service of its own motion for judgment on

the agency record, namely, those accruing before October 1, 2011.
Court No. 11-00006                                                 Page 11

       Lastly, although TMI does not object to the fee rates Commerce

and USM applied in their bills of costs, the court declines to

award fees based on the rates counsel for USM actually billed. See

Mark Indus., Ltd v. Sea Captain’s Choice, Inc., 50 F.3d 730, 733

(9th Cir. 1995) (“[T]he amount of an inherent powers sanction is

meant to do something very different than provide a substantive

remedy to an aggrieved party. An inherent powers sanction is meant

to ‘vindicat[e] judicial authority.’” (quoting Chambers, 501 U.S.

at 55)).    Other courts have determined the Laffey Matrix to be a

reasonable manner of assessing attorneys’ fees for complex federal

litigation in the Washington, D.C. area.     E.g., Young v. Dist. of

Columbia, 893 F. Supp. 2d 125, 130–32 (D.D.C. 2012); Jefferson v.

Milvets Sys. Tech., Inc., 986 F. supp. 6, 10–11 (D.D.C. 1997).

Thus, consistent with its purpose in assessing fees against TMI,

the court will apply Laffey Matrix rates to USM’s requested hours

so as to most reasonably value the time USM spent addressing TMI’s

vexatious and bad faith conduct before this court.

       Again in the interest of “restraint and discretion,” Chambers,

501 U.S. at 44–45, the court will assign each timekeeper to the

rate    category   with   the   lowest   possible     experience    level

commensurate with that timekeeper’s title.          In other words, the

court will assess associate and “counsel” fees under the 1–3 years’

experience row, and partner fees under the 8–10 years’ experience

row. Furthermore, the court will assess all consultant and project
Court No. 11-00006                                             Page 12

assistant fees at the paralegal experience row. See Gerber Aff. at

5.   Adjusting costs in this manner adequately ties the sanction to

TMI’s conduct without upsetting the purpose of the court’s prior

orders.

                               CONCLUSION

      The court is legally and factually justified in taxing TMI

with fees and costs as a deterrent against future vexatious and bad

faith   conduct   in   trade   proceedings.   The   court   will   award

Commerce’s requested fees and costs in full because they are both

reasonable and related to TMI’s misconduct in this action.         Based

on TMI’s objections and the court’s duty to exercise restraint and

discretion, however, the court will adjust USM’s requested award as

follows: (1) subtract fees and costs incurred before October 1,

2011; (2) subtract fees and costs incurred after May 16, 2012; (3)

reduce fees and costs incurred in January and February 2012 by 60%;

and (4) to the extent practicable, reduce USM’s fee rates to those

listed on the Laffey Matrix.     Therefore, as detailed in the tables

below, the court holds TMI and its counsel jointly and severally

liable to Commerce for $8,302.20 in combined fees and costs, and

jointly and severally liable to USM for $34,042.72 in combined fees

and costs.
Court No. 11-00006                                                                    Page 13

                                      USM Fees Table
Timekeeper      Title      Hours      Laffey    60% Pro Rata Reduction      Amount
                                       Rate     (for hours logged      (hours times
                                                between Jan. and Feb.  rate minus pro
                                                2012)                  rata reduction)

Denning      Counsel       139.3    $240.00     75.7 hours                 $22,531.20
                                                (-$10,900.80)

Doyle        Associate     0.3      $240.00     0.3 hours                  $28.80
                                                (-$43.20)

Enck         Paralegal     0.7      $140.00     n/a                        $98.00

Jones        Partner       1.5      $350.00     n/a                        $525.00

Lutz         Consultant    22.5     $140.00     n/a                        $3,150.00

McGregor     Consultant    0.25     $140.00     n/a (time logged in        $35.00
                                                Feb. 2012 unrelated
                                                to oral argument)

Nelson       Paralegal     17.0     $140.00     0.8 hours                  $2,312.80
                                                (-$67.20)

Snead        Associate     22.5     $240.00     10.9 hours                 $3,830.40
                                                (-$1,569.60)

Telep        Partner       0.3      $350.00     n/a                        $105.00

Williams     Associate     6.3      $240.00     5.2 hours                  $763.20
                                                (-$748.80)

                                                                Total:     $33,379.40


                                     USM Costs Table
  Bill Source             Dates        Amount        60% Pro Rata Reduction           Total
                        Incurred                  (for costs incurred between
                                                  Jan. and Feb. 2012)

King & Spalding         Nov. 2011     $43.99      n/a                                $43.99

King & Spalding         Dec. 2011     $59.50      n/a                                $59.50

King & Spalding         Feb. 2012     $720.53     (-$432.32)                         $288.21

Economic                Feb. 2012     $679.04     (-$407.42)                         $271.62
Consulting
Services

                                                                          Total:     $663.32


                                    Total Amounts Due
        Recipient                Fees Due               Costs Due            Total Due

Commerce                  $8,120.00                $182.20               $8,302.20

USM                       $33,379.40               $663.32               $34,042.72
Court No. 11-00006                                        Page 14

                              ORDER

     In accordance with the foregoing, it is hereby

     ORDERED that defendant United States is awarded a combined

$8,302.20 in fees and costs; and

     ORDERED that defendant-intervenor US Magnesium LLC is awarded

a combined $34,042.72 in fees and costs; and

     ORDERED that plaintiff Tianjin Magnesium International Co.,

Ltd. and plaintiff’s counsel, the law firm of Riggle and Craven,

shall be jointly and severally liable to pay both awards in full

within sixty (60) days of the filing of this order.




                                      /s/NICHOLAS TSOUCALAS
                                        Nicholas Tsoucalas
                                           Senior Judge

Dated: April 23, 2013
       New York, New York
