[00:00:02] Speaker 02:
is the Chief Judge from the District of Delaware, obviously very familiar with a variety of cases that come under the auspices of our jurisdiction.

[00:00:13] Speaker 02:
So we're very pleased to have him join us today.

[00:00:15] Speaker 02:
Thank you very much, Judge, and I'm delighted to be here.

[00:00:18] Speaker 02:
We originally had four cases for argument today, and for a variety of reasons, we have now collapsed it down to two cases for argument, which is unusual for us.

[00:00:30] Speaker 02:
But the first case

[00:00:31] Speaker 02:
which is an appeal from the Court of International Trade is CP Calco U.S.

[00:00:37] Speaker 02:
Inc.

[00:00:38] Speaker 02:
versus U.S.

[00:00:40] Speaker 02:
Case number 151209.

[00:00:41] Speaker 02:
Ms.

[00:00:42] Speaker 02:
Noonan, I understand you want five minutes for rebuttal?

[00:00:47] Speaker 02:
Yes, Your Honor.

[00:00:47] Speaker 02:
Okay.

[00:00:47] Speaker 02:
You may proceed.

[00:01:01] Speaker 01:
May it please the court?

[00:01:02] Speaker 01:
Your honors, my name is Nancy Noonan with the law firm of Aaron Fox, and together with my colleague, Matt Kanna, we represent the appellant, C.P.

[00:01:10] Speaker 01:
Kelko, U.S.

[00:01:12] Speaker 01:
Inc.

[00:01:13] Speaker 01:
This case involves a statutory provision which required the U.S.

[00:01:17] Speaker 01:
International Trade Commission to consider post-petition effects in determining whether the U.S.

[00:01:23] Speaker 01:
industry that produced Zanzan gum was being materially injured

[00:01:28] Speaker 01:
due to dumped imports of xanthan gum from China and Austria.

[00:01:32] Speaker 02:
You're not appealing the decision to accumulate these imports, are you?

[00:01:35] Speaker 01:
No, Your Honor.

[00:01:36] Speaker 02:
Even though they weren't cumulated for purposes of the material threat injuries?

[00:01:40] Speaker 01:
That's right, Your Honor.

[00:01:41] Speaker 01:
In fact, our position is the Commission got it right for purposes of material injury.

[00:01:46] Speaker 01:
They did examine the data on a cumulated basis.

[00:01:50] Speaker 01:
And our position is that if the post-petition effects were examined properly,

[00:01:55] Speaker 01:
In fact, they would continue to examine on accumulated basis, and we think that would have resulted in an affirmative injury defining for both Austria and China, which ultimately would have resulted in anti-dumping orders imposed on both countries.

[00:02:09] Speaker 02:
Is it your position that the post-petition effects for Austria would be different than they would be for China, or you're solely looking at this on accumulated effect?

[00:02:18] Speaker 01:
We are looking at this on accumulated basis for the purposes of material injury.

[00:02:23] Speaker 01:
You are right, Your Honor,

[00:02:24] Speaker 01:
The post-petition effects can be looked at for just threat of injury and also material injury, but our position is that the Commission got it right to accumulate for material injury, and if post-petition effects were looked at properly, material injury would have been found on an accumulated basis.

[00:02:42] Speaker 02:
And just to make sure we've closed the loop here, you're not appealing the determination with respect to threat of injury.

[00:02:48] Speaker 02:
That is correct.

[00:02:49] Speaker 01:
That's correct, Your Honor.

[00:02:52] Speaker 03:
Okay.

[00:02:54] Speaker 03:
Is it a substantial evidence review whether the petition had effects on the post-petition behavior?

[00:03:06] Speaker 01:
We think it's both in this case.

[00:03:08] Speaker 01:
We think as a matter of law, the commission did not comply with the statute to consider the post-petition effects properly.

[00:03:16] Speaker 03:
Because it just didn't say enough.

[00:03:18] Speaker 03:
That's right.

[00:03:19] Speaker 01:
It did not analyze it enough.

[00:03:21] Speaker 01:
It didn't address all the information adequately that we had provided in support of post-petition effects and then as a matter of evidence as well that we think the evidence does show post-petition effects and then that would have triggered the second part of the statutory provision which would have allowed the commission to reduce the weight if it so chose.

[00:03:41] Speaker 01:
for the post-petition effects.

[00:03:43] Speaker 02:
Can I ask you a question about the evidence as it relates to post-petition effects?

[00:03:47] Speaker 02:
Much of that has been designated as confidential in the briefing, so how do we talk about that?

[00:03:52] Speaker 01:
Well, I think we can talk about some trends, and I think I can, if necessary, refer you back to portions of the brief if that's acceptable to the court.

[00:04:03] Speaker 04:
Okay, we'll see if it works.

[00:04:04] Speaker 01:
Okay, okay.

[00:04:05] Speaker 04:
Before we move on to that, can we come back to consider and the statutory requirements that they consider

[00:04:10] Speaker 04:
your evidence, what is the minimum sort of degree of explanation you contend would be necessary?

[00:04:17] Speaker 04:
Why isn't the couple of sentences in the footnote enough here?

[00:04:21] Speaker 01:
Well, in this case, Your Honor, in the footnote, the Commission said, although there is some evidence showing purchasers approached domestic producers with sales inquiries after the petition was filed, the record shows no apparent changes in subject imports volume and pricing behavior.

[00:04:39] Speaker 01:
And some evidence, there's no citations to it.

[00:04:43] Speaker 01:
What exactly were they considering to be some evidence?

[00:04:46] Speaker 01:
It looks to us like maybe that was a couple of statements by the domestic producers, but we think there's a lot of other evidence on the record from purchasers, from importers themselves, talking about the changes, that the petition was filed, there was now a short supply.

[00:05:03] Speaker 01:
They couldn't get everything that they wanted to get.

[00:05:05] Speaker 01:
They shifted purchases.

[00:05:07] Speaker 01:
to the U.S.

[00:05:08] Speaker 01:
producers because of changes in sales terms.

[00:05:11] Speaker 01:
The U.S.

[00:05:11] Speaker 01:
producers are saying, hey, yeah, we definitely think there was a post-petition effect because we were being approached to sell and unlike this footnote which just said it was being approached with sales inquiries, we think the evidence shows that sales

[00:05:28] Speaker 01:
were made, and they were being made as a result of this petition.

[00:05:32] Speaker 04:
But the statute doesn't say shall explain in detail and with citation to the record, it says shall consider.

[00:05:37] Speaker 04:
On what basis could we say that the commission failed to consider your evidence?

[00:05:42] Speaker 01:
Well, Your Honor, I think, you know, looking at the plain meaning of the words consider, which is to, you know, carefully review something, I think that there is enough here that wasn't, that it's not clear that they consider.

[00:05:54] Speaker 01:
You're right, maybe on remand,

[00:05:56] Speaker 01:
they would walk through more of the data and we'd have to let it rest.

[00:06:03] Speaker 01:
But we think at this point, with all the evidence on the record, this does not meet the standard of considering.

[00:06:10] Speaker 02:
Well, even if they had some obligation to cite specific things in the record, there is a big difference between inquiries and actual volume and price effects, is there not?

[00:06:23] Speaker 01:
Yes, there is, and we think that certainly everyone agrees that the domestic producers were able to sell a lot more in 2012 than they had in 2011.

[00:06:34] Speaker 01:
Where we think the post-petition effects would really impact the material injury decision is on the market share analysis.

[00:06:44] Speaker 01:
it's clear that ultimately this case was about market share.

[00:06:48] Speaker 01:
The commission agrees that volume was increasing on an absolute basis, they agreed that there was significant underselling, but what the commission found was because market share remained stable, then the US industry could not have been being currently materially injured from imports.

[00:07:05] Speaker 01:
And our position is market share only was remaining stable in 2012 because of shift

[00:07:12] Speaker 01:
from purchasers that normally wouldn't have purchased subject imports, changing to purchase domestic.

[00:07:18] Speaker 01:
And if the adjustments were made in the data for that, we would see a continuing decline in market share for the US industry.

[00:07:32] Speaker 01:
So again, the most important pieces of evidence we think that shows that there were post-petition effects is that a large purchase of xanthan gum

[00:07:40] Speaker 01:
from a domestic producer that the purchaser acknowledges in their questionnaire response they were initially going to purchase from the Chinese supplier.

[00:07:49] Speaker 01:
Instead, they shifted to the domestic producer and that large quantity is quite a huge swing in the market share.

[00:07:56] Speaker 03:
Am I remembering right that there's no testimony from that purchaser that the material was unavailable from

[00:08:07] Speaker 03:
China was available from China, but that is no particular evidence as to the reason for that shift of one purchase.

[00:08:18] Speaker 01:
I think the purchaser said that they couldn't get it from China, that they were told that it was not available.

[00:08:25] Speaker 03:
And availability could mean that the Chinese sellers didn't have the stock

[00:08:35] Speaker 03:
which would be, roughly speaking, innocent, or it could mean that the Chinese sellers were withholding it so as not to, so as to help its case in the investigation.

[00:08:53] Speaker 01:
And we just don't know.

[00:08:57] Speaker 01:
We don't know, but we do know that the statement of administrative action allows the commission to apply a presumption

[00:09:03] Speaker 01:
that if there has been a change in volume, that that change is related to the pendency of the investigation and if the commission can then decide to reduce the weight.

[00:09:15] Speaker 01:
It is a rebuttable presumption, but we read the statement of administrative action as allowing the commission to make that presumption.

[00:09:22] Speaker 01:
So you see a change that has occurred after the petition was filed with no other information other than they shifted from subject imports to domestics

[00:09:32] Speaker 01:
we can presume that that shift was due to the pendency of the petition.

[00:09:36] Speaker 03:
Is there anything that would tell us kind of in the abstract whether the percentage shift that your figures show is significant or not?

[00:09:51] Speaker 03:
Screaming for an explanation or really that's pretty small or?

[00:09:56] Speaker 01:
Well I mean in terms of the one purchaser, we can see when we

[00:10:02] Speaker 01:
and shift that over into, let's say it did get purchased from the subject producers, we would see a several percentage point change in the market.

[00:10:12] Speaker 03:
Right, and is that kind of change, that several percentage point change, the kind of thing that in ITC practice in general is often viewed as

[00:10:28] Speaker 03:
significant or as often viewed as not significant.

[00:10:31] Speaker 03:
What I'm trying to figure out is, it seems to me the word considered probably needs to be applied based on how many questions are raised by the evidence.

[00:10:45] Speaker 03:
And if this small percentage shift is the kind of thing that in general doesn't raise very many questions, then it might be easier to conclude that

[00:10:58] Speaker 03:
the commission saying, we just don't see any effect of the petition on the post-petition change that would be material?

[00:11:09] Speaker 01:
I believe the commission does typically find these kind of percentage shifts in market share to be significant.

[00:11:15] Speaker 01:
You know, coupled with increasing volumes, coupled with significant underselling.

[00:11:20] Speaker 02:
But it's true that you essentially are dealing with a double discretionary

[00:11:27] Speaker 02:
conclusion here.

[00:11:28] Speaker 02:
I mean, the commission is supposed to consider it.

[00:11:32] Speaker 02:
There's nothing that defines what the level of consideration must be.

[00:11:36] Speaker 02:
And then, once they consider it, they have the discretion to discount it or not, right?

[00:11:41] Speaker 01:
That's right, Your Honor.

[00:11:42] Speaker 01:
But again, their discretion's not unfettered.

[00:11:45] Speaker 01:
I mean, they're always bound by the substantial evidence standard, whether a reasonable person would come to the conclusion based on these post-petition effects.

[00:11:55] Speaker 01:
If they agree that there are post-petition effects,

[00:11:57] Speaker 01:
whether that did materially impact whether there was injury or not.

[00:12:03] Speaker 02:
Kate, you're in for your rebuttal.

[00:12:04] Speaker 02:
Do you want to save the rest of your time?

[00:12:06] Speaker 01:
Yes, Your Honor.

[00:12:07] Speaker 01:
Thank you.

[00:12:15] Speaker 02:
Okay, Mr. Goldstein.

[00:12:16] Speaker 02:
I think we saw you yesterday, did we not?

[00:12:19] Speaker 02:
Yes, Your Honor.

[00:12:20] Speaker 05:
Good to see you again.

[00:12:22] Speaker 05:
Okay.

[00:12:23] Speaker 02:
Not always under these circumstances, I hope.

[00:12:26] Speaker 02:
Okay, you want 11 minutes and you're going to save four minutes for Mr. Waite?

[00:12:30] Speaker 04:
Yes.

[00:12:31] Speaker 02:
Okay.

[00:12:32] Speaker 02:
All right, proceed.

[00:12:34] Speaker 04:
Good morning, may it please the court.

[00:12:36] Speaker 04:
I'm David Goldfein, appearing on behalf of the U.S.

[00:12:38] Speaker 04:
International Trade Commission.

[00:12:40] Speaker 04:
I'd like to address several points that were raised by appellants here.

[00:12:45] Speaker 04:
First, with respect to the issue of consideration, as Judge Stark's question pointed out, the statute says that we're required to consider whether there's been any change in the data.

[00:12:56] Speaker 04:
And that's exactly what we did here.

[00:12:58] Speaker 04:
The footnote cites to the appellant's brief, which where they laid out all of the arguments that they're making exactly here.

[00:13:06] Speaker 04:
In fact, the same chart that's in their brief to this court about the market share shift is in the post hearing brief that we cited in the opinion.

[00:13:14] Speaker 04:
And it was also, that was addressed by Judge Goldberg here.

[00:13:18] Speaker 04:
So it's plain from the reading of the footnote, we did consider it.

[00:13:22] Speaker 04:
And as far as,

[00:13:26] Speaker 04:
There's another issue I'd like to address.

[00:13:30] Speaker 04:
The statute says whether there's been any change, post-petition provision provides, tells us to look at whether there's been any change in the volume, price, or impact data.

[00:13:40] Speaker 04:
That's what we do in these cases.

[00:13:41] Speaker 04:
We look for changes in the data.

[00:13:43] Speaker 04:
We do that.

[00:13:43] Speaker 02:
Well, would you agree that impact data would include market share?

[00:13:47] Speaker 04:
Well, the statute says volume, price, and impact.

[00:13:50] Speaker 04:
And volume and price are obviously part of impact.

[00:13:53] Speaker 04:
And in these cases, in Nucor and the cases we cited in our brief, JMC and nitrogen solutions, we look at the volume trends, what's going on with the volumes.

[00:14:03] Speaker 04:
And here, the volumes were the same before and after the petition was filed.

[00:14:07] Speaker 04:
They haven't disputed that at all.

[00:14:09] Speaker 02:
Well, your friend on the other side argues that everybody conceives there was a big market share differential.

[00:14:16] Speaker 04:
Right.

[00:14:16] Speaker 04:
Well, there's three big problems that are counterfactual, I would say.

[00:14:21] Speaker 04:
One is that,

[00:14:22] Speaker 04:
The first one would be we don't, it's based on a presumption that the purchaser here switched because of the petition, when as we've explained in our brief, the record evidence here plainly contradicts that, shows the purchaser identified a supply shortage, there was nothing about the petition, so that's still an after presumption.

[00:14:41] Speaker 04:
Two, it says that the counterfactual they've done, we don't do counterfactuals in post-petition.

[00:14:48] Speaker 04:
It's based on what were the trends before and after the petition was filed.

[00:14:52] Speaker 04:
We can't call subject imports domestic sales.

[00:14:55] Speaker 04:
Subject imports are subject imports.

[00:14:57] Speaker 04:
So in this case, it's built on a faulty kind of counterfactual analysis.

[00:15:03] Speaker 04:
It's just nowhere in the statute, the legislative history.

[00:15:06] Speaker 04:
Legislative history, the statute doesn't say anything about a presumption.

[00:15:09] Speaker 04:
We have discretion, as your honor pointed out.

[00:15:11] Speaker 04:
And three, they haven't even done a post-petition analysis.

[00:15:13] Speaker 04:
A post-petition analysis is what's in our brief, which is to compare the data in the first half of 2012 to the second half of 2012.

[00:15:20] Speaker 04:
The volumes did not change at all.

[00:15:22] Speaker 04:
in those periods, they went up slightly.

[00:15:23] Speaker 04:
The one case they cited here, the Gold East case, is exactly opposite fact.

[00:15:30] Speaker 04:
Typically, when there's post-petition effect, the subject import volumes will decline dramatically after petition, that's the language that was used in Gold East.

[00:15:39] Speaker 04:
This is the opposite of that case.

[00:15:40] Speaker 04:
They stayed flat, they even increased a little, but they basically were unchanged.

[00:15:44] Speaker 04:
Same with the pricing, but the underselling was exactly the same before and after the petition was filed.

[00:15:49] Speaker 04:
Their annual comparison is not.

[00:15:51] Speaker 02:
I mean, there were more price increases after the petition than price decreases after the petition, right?

[00:16:01] Speaker 04:
Well, the underselling margins was basically the same.

[00:16:06] Speaker 04:
It was basically the same before and after the petition was filed, the same rate.

[00:16:11] Speaker 04:
You're talking about the price increases, the rate of increases, the decreases, and we laid out in our brief.

[00:16:16] Speaker 04:
Depending on what you're looking at, you know, first half 2010, the beginning of the period up to the month that the petition was filed in June of 2012, and you compare that to second half 2012, it's basically the same data.

[00:16:28] Speaker 04:
It's almost identical.

[00:16:28] Speaker 04:
I think there's just one, there's one difference.

[00:16:30] Speaker 04:
What happened was when you look at it in terms of comparing the first and second half of 2012, there might be more price decreases, but that's the opposite of what you'd expect in a post-petition.

[00:16:48] Speaker 02:
Okay, well, what about the fact that the government did only deal with this in a flick note?

[00:16:54] Speaker 02:
I mean, why would Congress bother to pass a statute that says it must be considered if they could essentially give it what looks like the back of their hand?

[00:17:06] Speaker 04:
Well, as Judge Goldberg indicated in his opinion, the commission indicated this was a

[00:17:16] Speaker 04:
A very straightforward case as far as we saw, the volume and pricing behavior didn't change.

[00:17:20] Speaker 04:
So you don't need an elaborate explanation for that.

[00:17:23] Speaker 04:
Two, in New Court, this issue was raised and rejected by the court, by the Court of International Trade, and then this court affirmed that decision, which they argued that the commission had to cite every single piece of detracting evidence, which isn't detracting evidence at all, because as I explained, the main purchaser that they're relying on here didn't identify the petition as the reason for the change.

[00:17:44] Speaker 04:
But even if you were to view it,

[00:17:45] Speaker 04:
it's attracting evidence, we cited in the footnote, we considered the evidence, we cited their brief, that laid out all the arguments they're making now, the data they're saying, I was presumed to, and under the law of this circuit, we're presumed to have considered all of the evidence in the record.

[00:18:01] Speaker 04:
The fact that we don't cite every little piece of evidence doesn't mean we didn't consider it.

[00:18:05] Speaker 02:
But don't you see a difference between every little piece of evidence and pieces of evidence, period?

[00:18:11] Speaker 02:
I mean, you cite their brief, but,

[00:18:14] Speaker 02:
But wouldn't it have been more appropriate to have a little bit more of a fulsome analysis to say, okay, Congress tells us we're supposed to consider post-petition effects.

[00:18:24] Speaker 02:
We're looking at these post-petition effects, and this is what our view of them is, as opposed to simply saying in a footnote, we cite to their brief and say it's not enough.

[00:18:34] Speaker 04:
Well, two responses to that, Your Honor.

[00:18:37] Speaker 04:
One would be that we didn't just cite to their brief.

[00:18:40] Speaker 04:
We said there was no change in the volume and pricing.

[00:18:43] Speaker 04:
behavior.

[00:18:45] Speaker 04:
That's what we were relying on.

[00:18:46] Speaker 04:
There was no change in the data.

[00:18:48] Speaker 04:
It wasn't rocket science.

[00:18:49] Speaker 04:
The volumes didn't increase after the petition was filed, and the underselling and pricing behavior didn't change at all.

[00:18:58] Speaker 04:
It was a very straightforward analysis laid out in that footnote.

[00:19:03] Speaker 04:
We cited to the data.

[00:19:04] Speaker 04:
Two is in new core.

[00:19:06] Speaker 04:
This court pointed out that maybe the commission's discussion could have been more

[00:19:11] Speaker 04:
but it affirmed the commission saying on post-petition that no expansive discussion was warranted, particularly in a case like this where the trends on their face are so obvious.

[00:19:23] Speaker 03:
Can you just go over again, you probably have said it already, your very specific response to the point about the couple of percentage point shift as a result of what I guess is just one purchaser?

[00:19:39] Speaker 04:
Yes.

[00:19:42] Speaker 04:
couple of points there.

[00:19:42] Speaker 04:
One is the purchaser, that shift is based on the presumption that that purchaser switched due to the filing of the petition.

[00:19:50] Speaker 04:
All we have on the record here is their questionnaire.

[00:19:53] Speaker 04:
That's what the commission has before when it's analyzing the record here.

[00:19:57] Speaker 04:
The questionnaire doesn't identify the petition.

[00:19:59] Speaker 04:
It identifies the supply shortage.

[00:20:01] Speaker 04:
If they wanted to say petition, they could have said petition, but they didn't.

[00:20:04] Speaker 04:
Two is based on that presumption.

[00:20:08] Speaker 04:
So two is that the

[00:20:11] Speaker 04:
the counterfactual, the share, the market share shift, again, we don't, if you were to find it was due to the petition, which it wasn't, but if you were, you all, the commission has the discretion to decline to give that information less weight.

[00:20:24] Speaker 04:
It can't redo the math.

[00:20:26] Speaker 04:
There's no statutory basis for that or anything, case-driven or anything.

[00:20:32] Speaker 04:
So we look at the data that we have.

[00:20:35] Speaker 03:
The commission didn't specifically talk about that

[00:20:40] Speaker 03:
purchase shift, right?

[00:20:43] Speaker 04:
In the footnote, we talked about volume and pricing behavior.

[00:20:48] Speaker 03:
The purchase shift was... Let me just tell you what I did.

[00:20:53] Speaker 03:
They feature this one couple of percentage point shift in purchase.

[00:21:02] Speaker 03:
One might find that significant or not according to

[00:21:08] Speaker 03:
what one thought the reason for the shift was and one might find it significant or not according to how large in the scheme of things this couple of percentage point shift is.

[00:21:25] Speaker 03:
And one might demand an actual explanation focused specifically on the reason if that several percentage point shift

[00:21:37] Speaker 03:
was in the scheme of things significant.

[00:21:39] Speaker 03:
And the commission just didn't talk about any of this.

[00:21:43] Speaker 03:
Um, which it seems to me is pretty much what this comes down to.

[00:21:48] Speaker 03:
So he is this percentage shift, the kind of thing that in general, the commission would look at and say, we really ought to figure out why, why it happened.

[00:22:04] Speaker 04:
Well, no.

[00:22:06] Speaker 04:
I mean, we generally in these cases, in Nucor and the cases cited in our brief, JMC, Nigerian Solutions, you'll see the discussion.

[00:22:12] Speaker 04:
We generally look at what the volume, the statute says volume.

[00:22:16] Speaker 04:
We generally look at absolute volumes, in fact.

[00:22:18] Speaker 04:
And this court endorsed that approach in Nucor.

[00:22:21] Speaker 04:
We're looking at volumes now.

[00:22:22] Speaker 03:
They can point to... Looking only at what we said in Nucor, it doesn't matter what the percentage is.

[00:22:27] Speaker 03:
Obviously, the statute says you have to look at volume.

[00:22:29] Speaker 04:
That doesn't say what else you don't have to.

[00:22:31] Speaker 04:
There was no statement about you can't look at percentages, but what we generally do is we look at volumes.

[00:22:38] Speaker 04:
And part of the, there was no change in the volume data.

[00:22:44] Speaker 04:
So you can point to this market share shift, but again, it's based on at least two faulty presumptions, and mainly three.

[00:22:53] Speaker 04:
One, that it was due to the petition.

[00:22:54] Speaker 04:
Two, that it was,

[00:22:55] Speaker 03:
except that the, I mean, again, correct me if I'm wrong, the commission did not say we look at that purchase and we find it was not proven to have been caused by the petition.

[00:23:11] Speaker 04:
It didn't say that in the, in the opinion, but that's part of the record here.

[00:23:15] Speaker 02:
Well, it's part of the record in the sense that you say that they don't identify.

[00:23:19] Speaker 02:
They identify a shortage.

[00:23:20] Speaker 02:
But, I mean, what is the economic assumption that underlies the statute that says you have to consider this?

[00:23:25] Speaker 02:
That is, that post-petition, do they assume that what?

[00:23:29] Speaker 02:
That domestic producers will be afraid to buy subject imports?

[00:23:33] Speaker 02:
Or is there an assumption that subject imports will pull back

[00:23:37] Speaker 02:
so as to make it look like there's less of.

[00:23:41] Speaker 04:
The point of the post, it's in the legislative, the SAA, the statutes, that generally there's a decline in the volume after a petition is filed because of the restraining effect of the filing of the petition.

[00:23:52] Speaker 04:
Here, the opposite.

[00:23:54] Speaker 02:
Right, so couldn't that have been the reason for the lack of Chinese supply?

[00:24:00] Speaker 04:
Well, again, there was no,

[00:24:05] Speaker 04:
No, the purchaser they're pointing to didn't identify it.

[00:24:09] Speaker 02:
I mean, as far as... Well, he said, I've got less supply.

[00:24:11] Speaker 02:
I mean, why couldn't that presumption be he's got less supply?

[00:24:16] Speaker 02:
Because the Chinese, the subject imports are afraid to sell to the domestic during the period of the investigation.

[00:24:24] Speaker 04:
Well, he could have said that, but they didn't.

[00:24:27] Speaker 04:
But again, and also Judge Goldberg analyzes, it didn't really affect the outcome here anyway, because whether

[00:24:34] Speaker 04:
If you knock out 2012, which again, I want to be clear, they're not doing a post-petition analysis.

[00:24:39] Speaker 04:
Their chart is not post-petitioned.

[00:24:41] Speaker 04:
One year to the next, that's not post-petitioned.

[00:24:44] Speaker 04:
But what they're asking is knock out the 2012 data, we'll give them that.

[00:24:47] Speaker 04:
Judge Goldberg did that, and he ruled under harmless error analysis, substantial evidence, that there was clearly, the story didn't change here.

[00:24:54] Speaker 04:
Whether you knock out 2012, the trends are exactly the same.

[00:24:58] Speaker 04:
The story is exactly the same.

[00:24:58] Speaker 03:
Can I just ask you about the harmless error standard?

[00:25:03] Speaker 03:
It's one thing to say,

[00:25:05] Speaker 03:
they have not proved that the commission would have made a contrary finding had it not made the now by assumption mistake regarding petition effects.

[00:25:19] Speaker 03:
It's another thing to say that the commission could not have made a different finding.

[00:25:30] Speaker 03:
Doesn't harmless error require the latter?

[00:25:35] Speaker 04:
Well, no, it's whether the court was in substantial doubt as whether the commission would have reached a different outcome.

[00:25:43] Speaker 04:
That's the standard that we cited the cases in our brief.

[00:25:46] Speaker 04:
And Judge Goldberg was not in any substantial doubt here because the record, there was no volume price or impact on whether you, even if you knock out 2010,

[00:25:56] Speaker 04:
it's still a very strong negative determination.

[00:25:59] Speaker 04:
This was a unanimous commission determination, by the way.

[00:26:01] Speaker 04:
There was no.

[00:26:03] Speaker 03:
You may have said this already, but have we said that the relevant statutory provision, the, what is it, 16777I, when it uses the term change means change,

[00:26:20] Speaker 03:
change from what was or change from what would have been in the absence of the petition.

[00:26:28] Speaker 04:
Well, the statute says change.

[00:26:32] Speaker 03:
That could mean either of two things and the natural, in this context, causation question is a comparison to what would have happened in the absence of the petition.

[00:26:45] Speaker 03:
That's how you figure out whether this new data has been

[00:26:49] Speaker 03:
is reliable evidence of the underlying question.

[00:26:53] Speaker 04:
Right, the statute is there to ensure that the integrity of the commission's opinion.

[00:26:59] Speaker 04:
We're looking at whether there's been a change in the data post-petition, that the final petition has caused a change in the data.

[00:27:04] Speaker 04:
We've looked at volume, price, and impact.

[00:27:06] Speaker 04:
We've done our analysis, but they're not challenging the main findings there.

[00:27:10] Speaker 04:
Then we do basically a double check.

[00:27:13] Speaker 04:
We look at the post-petition for any changes in the data.

[00:27:16] Speaker 04:
There weren't any changes in the data here.

[00:27:18] Speaker 03:
I think I have not communicated my question clearly.

[00:27:25] Speaker 03:
There's the petition.

[00:27:27] Speaker 03:
There's data before, data after.

[00:27:29] Speaker 03:
So one question is, how do those two things compare?

[00:27:34] Speaker 03:
There's a different question.

[00:27:35] Speaker 03:
Data before, data after.

[00:27:37] Speaker 03:
And the different question is, how did the data after compare to what the data after would have been in the absence of the petition?

[00:27:46] Speaker 03:
That seems to me the logically relevant question to ask if you're trying to figure out whether the post-petition data is of significance to the underlying material injury question.

[00:28:03] Speaker 03:
Because it would take account of otherwise exogenous market changes.

[00:28:08] Speaker 04:
And I think I can answer that question by saying that

[00:28:11] Speaker 04:
That's the sort of the but for counterfactual world that they proffered up here, which is not in the statute.

[00:28:18] Speaker 04:
It's not in the legislative history.

[00:28:20] Speaker 04:
It's not in the case law.

[00:28:21] Speaker 03:
So that would be... Have we ever rejected that?

[00:28:23] Speaker 03:
Because it seems to me the statute does not answer that question.

[00:28:27] Speaker 03:
The statute does not unambiguously say compare yesterday to today, regardless of exogenous changes.

[00:28:35] Speaker 04:
It says whether there's been a change in the data.

[00:28:37] Speaker 04:
a change in the volume price and impact.

[00:28:40] Speaker 03:
I mean, whether... Let's not argue about the statute.

[00:28:43] Speaker 03:
Have we ever said that that inquiry is limited to change from yesterday to today as opposed to today versus what today would have been?

[00:28:57] Speaker 04:
Well, you have endorsed the commission and so has the Court of International Trade in a unbroken line of cases has endorsed the commission's approach here, the approach that it took here.

[00:29:07] Speaker 04:
I'm not aware of a case where you said you can't do it counterfactual, but it's the opposite of the approach that this court and the CIT have endorsed in case recited in our brief.

[00:29:20] Speaker 03:
Somebody has argued to us the commission failed to comply with this provision by not asking the counterfactual question, and we said that's fine.

[00:29:31] Speaker 04:
You said that's fine.

[00:29:33] Speaker 03:
We said it is okay for the commission not to ask the counterfactual question.

[00:29:38] Speaker 04:
I'm not aware.

[00:29:39] Speaker 04:
No, there's no case.

[00:29:41] Speaker 04:
I'm not aware of that because it hasn't been done before.

[00:29:45] Speaker 03:
It hasn't been argued.

[00:29:46] Speaker 03:
So there isn't actually any precedent on this question.

[00:29:48] Speaker 04:
Well, there is in the sense that this court in new core commission looking at volumes and in the other case we cite in our brief JNC nitrogen solutions.

[00:29:57] Speaker 04:
other cases that court has endorsed the approach that the commission has done here.

[00:30:02] Speaker 04:
It's our approach.

[00:30:03] Speaker 03:
We don't do counterfactual.

[00:30:05] Speaker 03:
Let's just say this one more time.

[00:30:06] Speaker 03:
An endorsement doesn't count for anything on an issue not presented to the court.

[00:30:13] Speaker 03:
If nobody ever asked this court to disapprove the commission's refusal to look at the counterfactual, then it doesn't matter what we said.

[00:30:26] Speaker 04:
Fair point, but the counterfactual property here is not based.

[00:30:30] Speaker 04:
There's no statutory authority for that in the statute.

[00:30:33] Speaker 04:
You can't reclassify subject data as domestic shipments.

[00:30:38] Speaker 04:
There's no basis for that.

[00:30:39] Speaker 04:
We look at the data in the record as it exists.

[00:30:42] Speaker 04:
It's not in the statute or the case law or the legislative history.

[00:30:49] Speaker 02:
You're well over your time.

[00:30:50] Speaker 02:
I'm gonna go ahead and give Mr. Waite his four minutes and we'll give a couple extra minutes to the appellant.

[00:30:58] Speaker 06:
Good morning, may it please the court.

[00:31:01] Speaker 06:
My name is Fred Wade on behalf of the defendant-intervener appellee Jungbunzlauer, Austria.

[00:31:08] Speaker 06:
And I would like to continue the colloquy that was stopped when Mr. Goldfein sat down on two of the points that your honors have raised and have pursued.

[00:31:20] Speaker 06:
First of all, the counterfactual or what might have been had the petition not been filed that you raised, Judge.

[00:31:28] Speaker 06:
The statute says shall consider any change in volume price and impact.

[00:31:32] Speaker 06:
We've heard that repeatedly since the filing of the petition.

[00:31:38] Speaker 06:
That indicates to me that the commission is to look at volume price impact since the petition was filed to see if there are any changes.

[00:31:47] Speaker 06:
Logically, the commission in evaluating whether there are any changes is going to look at what happened before the petition was filed.

[00:31:56] Speaker 06:
What happened before this act, which is so much concerns the Congress that it amended the statute to instruct the commission to consider post petition effects because it was concerned that the filing, mere filing of a petition could so mask the injury that the domestic industry was experiencing that the commission could make a negative determination when in fact it was the petition that was

[00:32:26] Speaker 03:
driving increased domestic shipments, reduced imports, increased... But do you understand my, maybe it's just a confusion on my part, but it seems to me that precisely the congressional concern you just described logically requires an inquiry into a comparison between what happened after the petition and what would have happened after the petition.

[00:32:52] Speaker 03:
That's how you figure out whether the petition had an effect.

[00:32:55] Speaker 06:
I respectfully disagree.

[00:32:57] Speaker 03:
Because just doing before and after completely ignores exogenous changes in the market.

[00:33:03] Speaker 06:
Well, I'm not sure the Congress was concerned about exogenous changes in the market.

[00:33:07] Speaker 06:
The Congress was concerned about a petition is filed.

[00:33:10] Speaker 06:
The Congress is concerned that after the filing of a petition, foreign producers constrict their exports to the United States and raise their prices in order to try to respond to the petition.

[00:33:25] Speaker 06:
It's not going to affect the outcome, incidentally, because the periods of investigation of both the Commerce Department and the International Trade Commission terminate when the petition is filed.

[00:33:35] Speaker 06:
So it doesn't change that data.

[00:33:38] Speaker 06:
What it might change as the commission is looking in its final determination is whether or not the domestic industry had a boost after the petition was filed and looks far better than it would otherwise have looked.

[00:33:51] Speaker 06:
Now, the commission does do counterfactual

[00:33:53] Speaker 06:
analyses in sunset and threat cases.

[00:33:57] Speaker 06:
But that's because it's looking forward.

[00:33:58] Speaker 06:
It's trying to speculate what would happen if an order is revoked.

[00:34:03] Speaker 06:
What would happen if we did not make a threat finding given the factors that we're looking at in terms of the foreign producers' behavior and the domestic industry's performance.

[00:34:14] Speaker 06:
Speculation.

[00:34:16] Speaker 06:
And the commission acknowledges that and the court acknowledges that.

[00:34:18] Speaker 06:
It's looking into the future.

[00:34:20] Speaker 06:
Here the commission has actual data.

[00:34:22] Speaker 06:
and the actual data is overwhelming.

[00:34:25] Speaker 02:
The commission all consistently focuses on price and volume, and I keep saying that's what we're supposed to be looking at.

[00:34:31] Speaker 02:
What does impact mean separate from price and volume?

[00:34:35] Speaker 02:
It's a third word used in the statute.

[00:34:38] Speaker 02:
Couldn't that have to do with the percentages of the market or other factors that are less concrete?

[00:34:46] Speaker 06:
Well, I wouldn't say less concrete, Your Honor, but indeed, impact is

[00:34:50] Speaker 06:
Changes in price and volume are going to impact market share.

[00:34:55] Speaker 02:
Right, but are you saying that impact has no independent meaning other than changes in price and volume?

[00:35:01] Speaker 06:
Impact is looking largely at the domestic industry, at its operational performance, at its financial performance.

[00:35:10] Speaker 06:
And impact means what are the changes in pricing?

[00:35:14] Speaker 06:
What are the changes in volume?

[00:35:16] Speaker 06:
What are the absolute

[00:35:18] Speaker 06:
pricing and volume impacts on the U.S.

[00:35:21] Speaker 06:
industry.

[00:35:22] Speaker 02:
So would they look at profit?

[00:35:24] Speaker 06:
I beg your pardon?

[00:35:24] Speaker 02:
They look at profit?

[00:35:25] Speaker 06:
The domestic industry?

[00:35:27] Speaker 02:
Yes.

[00:35:27] Speaker 06:
Yes, if the post-petition effect is that the foreign producers stop shipping and increase their prices, yes, then the domestic industry looks better than it otherwise would.

[00:35:38] Speaker 06:
Its shipments go up, its sales go up, its capacity utilization rates improve.

[00:35:43] Speaker 06:
is profitability improves because it's selling at a higher price.

[00:35:46] Speaker 06:
And if Your Honor, without taking a breath, I just wanted to address one final point, and it has to do with that elusive oil field purchaser who's been the subject of so much concern this morning with its, and you were correct, Your Honor, it's a couple of percentage points.

[00:36:01] Speaker 06:
It's not several percentage points.

[00:36:03] Speaker 06:
Be that as it may, that producer was only one of 33 producers who submitted questionnaire responses.

[00:36:10] Speaker 06:
I would urge your honors to look at that one questionnaire response from that producer.

[00:36:15] Speaker 06:
It does not say what the appellant's claimant says.

[00:36:19] Speaker 06:
It does not say that the shift was the result of the petition.

[00:36:25] Speaker 06:
Indeed, if your honors will look very closely at that purchaser's purchases over the period of investigation, you will see that that purchaser didn't shift at all during this investigation.

[00:36:39] Speaker 06:
It did not shift.

[00:36:40] Speaker 06:
from imports to domestic.

[00:36:44] Speaker 06:
Thank you, Your Honors, unless you have any other questions.

[00:36:46] Speaker 06:
Thank you.

[00:36:48] Speaker 02:
I will restore your full five minutes.

[00:37:02] Speaker 01:
May it please the Court, Nancy Noonan again on behalf of Appellant

[00:37:06] Speaker 01:
Just to get back to our elusive oil field purchaser, we do have the other side of the story.

[00:37:13] Speaker 01:
We have evidence on the record from the domestic producer from whom that purchase was made, where the domestic producer puts forth his point of view that that purchase was made due to the petition being filed.

[00:37:27] Speaker 01:
So we do have two sides to the story there.

[00:37:30] Speaker 02:
Regarding the- Well, let's look at what it accepts.

[00:37:33] Speaker 01:
We have made the connection based on the totality of having the domestic producer's information on the record coupled with this purchase, coupled with the presumption that is allowed, that the commission may apply, that if something changes after a petition is filed, it can be presumed that that change was based on the petition being filed.

[00:37:56] Speaker 01:
It is a rebuttable presumption, but we feel that there's nothing on the record.

[00:38:00] Speaker 02:
But it's not even a presumption that's automatic.

[00:38:03] Speaker 02:
it's a discretionary presumption.

[00:38:05] Speaker 02:
So I mean, even if they choose to apply the presumption, then it's rebuttable, but they don't have to apply the presumption.

[00:38:13] Speaker 01:
That's correct.

[00:38:14] Speaker 01:
We think they have the discretion to apply the presumption.

[00:38:16] Speaker 01:
We think in at least one other case, I think it was the cold rolled steel case, they did specifically reference the presumption.

[00:38:23] Speaker 01:
One of the commissioners mentioned the presumption as well during questioning at the hearing.

[00:38:29] Speaker 01:
But we think that, I mean, just to,

[00:38:33] Speaker 01:
get back to the data before the petition and the data after the petition.

[00:38:37] Speaker 03:
We think that that's enough to show that there was a post-petition effect, and whether you call it counterfactual or you... There's been a lot of talk, and I don't have a clear grasp of this, but the data that you rely on in your, you know, the But For World chart is not actually a comparison of

[00:38:58] Speaker 03:
pre-petition data and post-petition data, but something different.

[00:39:02] Speaker 03:
Can you address that?

[00:39:03] Speaker 01:
Well, we did look at the whole 2012 period in that chart that we put together, because we had the annual data of all the imports coming in, and it matched exactly with what the commission's staff report said.

[00:39:18] Speaker 01:
So it is true that we provided that data in the context of the entire 2012 year.

[00:39:24] Speaker 01:
So there's an overlap, is that right?

[00:39:27] Speaker 01:
But what we do know though is that particular sale did not occur until after the petition was filed.

[00:39:32] Speaker 01:
The petition was filed in June 2012.

[00:39:35] Speaker 01:
And contrary to the ITC council's position, we actually are not necessarily saying the commission should completely disregard 2012.

[00:39:47] Speaker 01:
We actually think the commission could continue to keep on the record the six months of 2012 before the petition was filed.

[00:39:55] Speaker 01:
and then discount if they choose to do so, discount the weight of the evidence for the second half of 2012 after the petitions filed.

[00:40:04] Speaker 04:
Given the price and volume trends or maybe the lack of change, isn't there at least substantial evidence to support what the commission chose to do here?

[00:40:13] Speaker 01:
Well, for both of those provisions in the statute, the commission ultimately made it a market share decision.

[00:40:20] Speaker 01:
Yeah, this volume is increasing, which normally, frankly, would have resulted in affirmative material injury.

[00:40:26] Speaker 01:
But they said, but even though it's increasing, we have relatively the same market share.

[00:40:31] Speaker 01:
They said there's significant underselling, but the underselling has not resulted in capturing market share from the domestic industry.

[00:40:39] Speaker 01:
So I think in this case, which I do think is unique.

[00:40:43] Speaker 01:
it really ultimately comes down to market share.

[00:40:46] Speaker 01:
And for us, we think the evidence shows a huge shift, a shift in market share based on the post-petition effects.

[00:40:54] Speaker 03:
Can I ask you to talk to me for a minute about the precedent question that I was discussing a little bit with the commission's lawyer.

[00:41:04] Speaker 03:
Assume for a minute with me that the statutory language leaves open

[00:41:12] Speaker 03:
whether the commission is supposed to consider yesterday versus today or today versus what today might have been.

[00:41:21] Speaker 03:
Have we addressed that question?

[00:41:23] Speaker 03:
Have we even presented a contention that the commission, by looking only at the yesterday versus today comparison, failed to fulfill its obligation to consider change in the sense of change from what would have occurred in the absence of the petition?

[00:41:42] Speaker 01:
I cannot think of a case, Your Honor, where the court directly addressed that question.

[00:41:47] Speaker 03:
Okay, and one other presidential question.

[00:41:50] Speaker 03:
I know that there are statutes all over the U.S.

[00:41:52] Speaker 03:
Code that tell agencies to consider something.

[00:41:57] Speaker 03:
Are you aware of any cases, other courts of appeals in APA land that address, that provide a formulation for how we should decide or how court should decide

[00:42:12] Speaker 03:
when a set of remarks constitutes consideration or evidences consideration and when it doesn't?

[00:42:22] Speaker 01:
I don't recall that we necessarily looked into that.

[00:42:25] Speaker 01:
I'm hoping it's because it wasn't out there, but we were just relying on the plain meaning of the statute of the word consider.

[00:42:33] Speaker 01:
What does it mean?

[00:42:34] Speaker 02:
Could there be a chevron overlay to this?

[00:42:39] Speaker 01:
Well, I think I consider considered to be plain language.

[00:42:42] Speaker 01:
The plain language of the statute is to consider it.

[00:42:45] Speaker 01:
And then you look at the evidence that was presented and whether the evidence was considered.

[00:42:50] Speaker 01:
And here we think the evidence was not sufficiently considered.

[00:42:52] Speaker 02:
And the citation to your brief where all the evidence was laid out is not enough?

[00:42:57] Speaker 01:
No, because all they ultimately hung their hat on was some evidence that domestic producers were approached.

[00:43:06] Speaker 01:
And we laid out a lot more than just some evidence.

[00:43:09] Speaker 01:
of that, so I don't think that was sufficient.