Advanced Tech. & Materials Co. v. United States, No. 10-00012 (Ct. Int'l Trade 2010)
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The court issued a subsequent related opinion or order on August 18, 2011.
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Slip Op. 10-59 UNITED STATES COURT OF INTERNATIONAL TRADE ADVANCED TECHNOLOGY & MATERIALS CO., LTD., BEIJING GANG YAN DIAMOND PRODUCTS COMPANY, and GANG YAN DIAMOND PRODUCTS, INC., Plaintiffs, v. UNITED STATES, Defendant, and DIAMOND SAWBLADES MANUFACTURERS COALITION, Defendant-Intervenor. : : : : : : : : : Before: R. Kenton Musgrave, Senior Judge : Court No. 10-00012 : : : : : : : : : : : OPINION AND ORDER [Plaintiffs Motion to Supplement the Administrative Record is denied.] Dated May 18, 2010 Barnes, Richardson & Colburn (Jeffery S. Neeley) for Plaintiffs. Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, and Franklin E. White, Jr., Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Claudia Burke); Office of the Chief Counsel for Import Administration, U.S. Department of Commerce (Hardeep K. Josan), Of Counsel, for Defendant United States. Wiley Rein, LLP (Daniel B. Pickard) for Defendant-Intervenor. Court No. 10-00012 Page 2 Musgrave, Senior Judge: Plaintiffs Advanced Technology & Materials Co. Ltd., Beijing Gang Yan Diamond Products Company, and Gang Yan Diamond Products, Inc. ( Plaintiffs ), move to supplement the administrative record compiled by Defendant International Trade Administration, United States Department of Commerce ( Commerce or the Department ) in regard to Plaintiffs challenge of the Department s December 27, 2009 decision not to conduct a changed-circumstances review. The court has jurisdiction over this matter pursuant to 28 U.S.C. § 1581(i) (2006). For the reasons set forth below, Plaintiffs Motion to Supplement the Administrative Record will be denied. Background On May 22, 2006, the Department issued a determination that imports of diamond sawblades from the People s Republic of China are being sold, or likely to be sold, at less-than-fairvalue ( LTFV ). See Final Determination of Sales at Less Than Fair Value and Final Partial Affirmative Determination of Critical Circumstances: Diamond Sawblades and Parts Thereof from the People s Republic of China, 17 Fed. Reg. 29303 (May 22, 2006) ( Final Determination ). Although delayed by several legal challenges, the Department ultimately issued antidumping duty orders in accordance with the Final Determination on November 4, 2009. See Diamond Sawblades and Parts Thereof from the People s Republic of China and the Republic of Korea: Antidumping Duty Orders, 74 Fed. Reg. 57145 (Nov. 4, 2009). Plaintiffs took action to dispute the Final Determination in three ways: (1) by intervening in the petitioner s challenge to that determination (Court No. 06-00246); (2) by filing their own challenge to the Final Determination pursuant to 19 U.S.C. § 1516a(a)(2)(A)(i)(II) (Court No. 09-00511); and (3) by officially requesting that the Department conduct a review of the Final Court No. 10-00012 Page 3 Determination based on changed circumstances pursuant to 19 U.S.C. § 1675(b). In their request for review, Plaintiffs asserted that the Department should recalculate the Final Determination dumping margins to reflect the Department s official policy change, announced on December 27, 2006, that it would discontinue the practice of zeroing in dumping-margin calculations. See Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an Antidumping Investigation; Final Modification, 71 Fed. Reg. 77722 (Dec. 27, 2006.) In a letter dated December 14, 2009, the Department informed Plaintiffs that it would not conduct a changedcircumstances review, stating that the policy change did not apply to Final Determination because the diamond sawblades investigation was not pending before the Department on the effective date of the policy change. Changed Circumstances Determination at 2 (internal quotes omitted). Consequently, Plaintiffs filed the instant action in this Court seeking judicial review of the Department s decision not to conduct a review. As per the Court s Rules, the Department filed with the Clerk of the Court the administrative record for this action on March 8, 2010. The record submitted was comprised largely of three documents: (1) Plaintiffs November 17, 2009 Changed Circumstances Request; (2) the Changed Circumstances Determination (a two-page letter), and (3) a letter from the Department rejecting Plaintiffs prior (April 27, 2009) request for a changedcircumstances review of the Final Determination. Plaintiffs object to the meagerness of the Department s submission and now move to supplement the administrative record by admitting all materials contained in the administrative record of Court No. 06-00246, as well as all information pertaining to the April 27, 2009 request for a changed circumstances review (which Commerce denied as premature). Pls. Mot. at 4. Plaintiffs argue, inter alia, that these materials should be part of the record because, pursuant to USCIT Rule Court No. 10-00012 Page 4 73.2(a)(1), the administrative proceeding at issue includes the changed circumstances requests that resulted from [the] order issued in the original investigation, as well as the earlier changed circumstances request of Plaintiff[s ] putting Commerce on notice of the zeroing issue prior to the issuance of the order. Pls. Mot. at 2. Plaintiffs assert that their November 17, 2009 request for review did not occur in a vacuum, but [is] part and parcel of the underlying investigation and the prior changed circumstances request, and that Commerce cannot arbitrarily create a narrow record that ignores the underlying factual record that is the entire basis of the changed circumstances request. Id. The Department opposes the motion and asserts that the administrative record as submitted contains all of the documents required by USCIT Rule 73.3,1 and notes further that 1 Pursuant to statute and the Court s Rules, the administrative record must contain certain documents. 28 U.S.C. § 2635 (2006) provides that in actions in which judicial review is to proceed upon the basis of the record made before the agency, the agency must file with the Court: (A) A copy of the contested determination and the findings or report on which such determination was based. (B) A copy of any reported hearings or conferences conducted by the agency. (C) Any documents, comments, or other papers filed by the public, interested parties, or governments with respect to the agency s action. The agency must identify and file under seal any document, comment, or other information obtained on a confidential basis, including a nonconfidential description of the nature of such confidential document, comment or information. (4) A certified list of all items specified in paragraphs (1), (2) and (3) of this subdivision (a). 28 U.S.C. § 2635 (2006). Similarly, USCIT Rule 73.3 provides that in All Other Actions Based Upon the Agency Record the agency must file with the Court: (a)(1) A copy of the contested determination and the findings or report upon which such determination was based. (continued...) Court No. 10-00012 Page 5 Plaintiffs previous request for a changed circumstances review is already contained in the record. Def. s Opp n. at 3. The Department contends further that its designation of the administrative record is entitled to the presumption of administrative regularity, and that the court must presume the current record is complete because, in the Department s view, Plaintiffs have failed to present clear evidence to the contrary. Id. Discussion Should it reach the merits of this case, the court s review is governed by the standards set forth in 5 U.S.C. § 706, which provides that the agency s decision must be upheld unless determined to be arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law, and specifies that [i]n making the foregoing determination, the court is limited to review of the whole record or those parts of it cited by a party . . . . 5 U.S.C. § 706. Under section 706, the whole record means the full administrative record that was before the Secretary at the time he made his decision. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420 (1971), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977). Lower courts have further defined the whole record as including everything that was before the agency pertaining to the merits of its decision, Portland Audubon Soc. v. Endangered 1 (...continued) (2) A copy of any reported hearings or conferences conducted by the agency. (3) Any documents, comments, or other papers filed by the public, interested parties, or governments with respect to the agency s action. The agency shall identify and file under seal any document, comment, or other information obtained on a confidential basis, including a non-confidential description of the nature of such confidential document, comment or information. (4) A certified list of all items specified in paragraphs (1), (2) and (3) of this subdivision (a). USCIT R. 73.3. Court No. 10-00012 Page 6 Species Committee, 984 F.2d 1534,1548 (9th Cir. 1993), and all documents and materials directly or indirectly considered by agency decision-makers. Thompson v. United States Dep t of Labor, 885 F.2d 551, 555 (9th Cir. 1989). Plaintiffs first dispute lies not with what constitutes the whole record, but with the proper definition of the administrative proceeding as that term is used in USCIT Rule 73.2.2 Plaintiffs contend that the administrative proceeding encompasses far more than the single decision under challenge, and, at the very least, must also include the original LTFV investigation, the Final Determination, as well as Plaintiffs first changed-circumstances request. Plaintiffs explain that the changed-circumstances decision currently before the court cannot be viewed in isolation but is part and parcel of the underlying investigation and the prior changed circumstances request. Pls. Mot at 2. This being so, Plaintiffs argue, the record from the underlying investigation and the resulting determination (found in the record for Court No. 06-00246) as well as all records pertaining to the prior changed-circumstances request should be included in the administrative record here. The court finds this argument problematic for several reasons. First, this action is not governed by Rule 73.2, but Rule 73.3, which contains no reference to the administrative proceeding, but instead refers only to the agency s action. Further, even if Rule 73.3 contained terminology more amenable to the expansive interpretation Plaintiffs advocate, arguments of this nature have been soundly rejected by this Court. In Beker Industries Corp., v. United States, the Court determined that the administrative proceeding refers only to the immediate administrative 2 Rule 73.2, which applies to Documents in An Action Described in 28 U.S.C. § 1581(c) or (f), does not govern this action. This action falls under 28 U.S.C. § 1581(i), which is governed by Rule 73.3 Documents in All Other Actions Based Upon the Agency Record. Cf. USCIT R. 73.2 with R. 73.3. Court No. 10-00012 Page 7 review in dispute and nothing more. Beker, 7 CIT 313, 315 (1984). More specifically the court noted: The scope of the record for purposes of judicial review is based upon information which was before the relevant decision-maker and was presented and considered at the time the decision was rendered. It is obvious in this case that the relevant decision-maker was the ITA (and not the Treasury Department). It is equally clear that plaintiff is not challenging the original anti-dumping finding, but rather the final decisions made relating to the administrative review at issue . . . . Id. Although Beker involved a different Rule and a different statute, the analysis in that case was based on fundamental principles of administrative law and applies with equal force here. In this matter, as in Beker, it is clear that the relevant decision-maker was the Department and that Plaintiffs are not challenging the Final Determination but rather the Department s decision not to conduct a changed circumstances review. See Complaint at 1.3 Hence, the administrative record in ths matter includes only those documents that were directly or indirectly considered by the Department s decision-makers at the time that decision was rendered. Accordingly, Plaintiffs expansive interpretation of the agency action or the administrative proceeding must be rejected as contrary to the Court s caselaw and unsupported by the language of Rule 73.3. See generally Fund for Animals v. Williams, 245 F.Supp.2d 49, 57 (D.D.C. 2003) (finding that interpretation of the term before so broadly as to encompass any potentially relevant document existing within the agency or in the hands of a third party would render judicial review meaningless. ). 3 The core function of the complaint is to give the defendant fair notice of what the plaintiff s claim is and the grounds on which it rests. Conley v. Gibson, 355 U.S. 41, 47 (1957). See DaimlerChrysler Corp. v. United States, 442 F.3d 1313, 1320 (Fed. Cir. 2006) (noting that an essential purpose of the [complaint], as the initial pleading, is to put the Government on notice of what protest decisions are being contested in the Court of International Trade. ). Court No. 10-00012 Page 8 Plaintiffs next assert that supplementation of the record is necessary: (1) because Plaintiffs arguments cannot be fully reviewed by this Court on the current record, supplementation is required to prevent frustration of judicial review; (2) in order to obtain background information necessary for the court to make an informed decision; and (3) to explain the existing record and judge the adequacy of the procedures and facts considered. Pls. Mot. at 3-4. It is black letter law that review in federal court must be confined to the agency s record; consideration of information outside of the record is deemed appropriate only in the rare case. See Charles H. Koch, Jr., 3 Administrative Law and Practice § 8.27 (2d ed. 2010); Walter O. Boswell Mem l Hosp. v. Heckler, 749 F.2d 788, 792 (D.C. Cir. 1984) (holding that [i]f a court is to review an agency s action fairly, it should have before it neither more nor less information than did the agency when it made its decision ). However, most courts have recognized several rare case exceptions to the record rule, and will allow for consideration of extra-record evidence in certain compelling, narrowly defined circumstances. These exceptions include situations (1) where the movant has presented a strong showing of bad faith or improper behavior by agency decision makers, Overton Park, 401 U.S. at 420; (2) where the court, at its discretion, wishes to obtain background information as an aid to understanding highly technical matters, see Animal Defense Council v. Hodel, 840 F.2d 1432, 1436 (9th Cir. 1988); or to judge the adequacy of the procedures and facts considered, see Former Employees of Pittsburgh Logistics Sys., Inc. v. United States Sec y of Labor, 27 CIT 339, 343 (2003); and (3) when there is such failure to explain administrative action as to frustrate effective judicial review . . . . Camp v. Pitts, 411 U.S. 138, 142-43 (1973). The courts will also supplement the record upon a showing that the administrative record is not complete. As noted by the government, the Department s designation of the record is Court No. 10-00012 Page 9 entitled to a presumption of administrative regularity, and the court must presume that all of the materials considered in the decision-making process have been included. However, if that presumption is rebutted by a party s presentation of clear evidence that the materials were considered by the decision-makers the materials may be admitted to complete the record. See Bar MK Ranches v. Yuetter, 994 F.2d 735, 740 (10th Cir. 1993); Ammex, Inc. v. United States, 23 CIT 549, 556, 62 F. Supp.2d 1148, 1153 (1999). Although record supplementation on these grounds is often viewed as one of the exceptions to the record rule described above, it is described more accurately as completing the record because the material sought to be included is only that which (allegedly) should have been a part of the record to begin with. See Pacific Shores Subdiv. Cal. Water Dist. v. U.S. Army Corps of Engineers, 448 F. Supp.2d 1, 4 (D.C. Dist. 2006). Plaintiffs in this matter do not allege that the Department considered the materials they seek to admit, but instead focus on admission of the documents pursuant to the limited exceptions for consideration of extra-record evidence. However, these arguments fail. Plaintiffs contentions as to the need for background information or for information needed to judge the adequacy of the procedures and facts considered are essentially bare allegations with no reference as to how the Department s decision is lacking, what procedures could be inadequate, or which particular documents are needed for elucidation. Moreover, judicial review is not frustrated by the court s inability to fully review Plaintiffs arguments: the Department s Changed Circumstances Determination is before the court for review, not the Plaintiffs arguments. It is that determination, not Plaintiffs arguments, that the court must set aside if found to be arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law. Court No. 10-00012 Page 10 Finally, the court notes that the record, although sparse, does not appear incomplete on its face. The text of the decision itself indicates that Commerce rejected Plaintiffs request for review on the single, purely legal, premise that the original investigation was not pending before the Department on the effective date of the policy change. Arguments that attack the Changed Circumstances Determination for reasons other than the narrow grounds upon which the decision rests do not seem likely to assist the court in its merits review of this matter. The court has considered all other arguments presented by Plaintiffs and considers them to be without merit. Conclusion In consideration of the foregoing, the court is unable to conclude that the materials proffered by Plaintiffs were before the agency decision-maker at the time the agency rendered the decision under review, or that the record may be otherwise supplemented pursuant to any of the relevant exceptions that allow for the consideration of extra-record evidence. Motion denied. SO ORDERED. /s/ R. Kenton Musgrave R. KENTON MUSGRAVE, Senior Judge Dated: May 18, 2010 New York, New York
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