[00:00:08] Speaker ?:
Okay, let's go.

[00:00:39] Speaker 00:
OK, the next case is number 16, 1426, Mid-Continent Nail Corporation against the United States, Mr. Yoses.

[00:00:49] Speaker 02:
Thank you, Your Honor.

[00:00:50] Speaker 02:
May it please the court?

[00:00:51] Speaker 02:
My name is David Yoses on behalf of Mid-Continent Nail Corporation.

[00:00:55] Speaker 02:
Mid-Continent was the original petitioner in the any dumping investigation that's at issue here on steel nails from the United Arab Emirates that was filed with a petition in March of 2011.

[00:01:07] Speaker 03:
Has Commerce shown any interest in repealing the original regulation since the Court of International Trade decision, or have they just agreed that they're going to stick with the original regulation?

[00:01:24] Speaker 02:
No.

[00:01:24] Speaker 02:
Commerce went through a notice and comment procedure that was entitled of the non-application of the withdrawn regulation.

[00:01:34] Speaker 02:
and they gave notice and comment, went through a notice and comment proceeding, and formally continued not to apply the withdrawn regulations.

[00:01:43] Speaker 02:
So Commerce has not applied the withdrawn regulation in any case since the time it was withdrawn, other than on remand in a few cases from the Court of International Trade.

[00:01:54] Speaker 03:
So, I'm confused.

[00:01:56] Speaker 03:
Is there an ongoing rulemaking now to

[00:02:03] Speaker 03:
apply APA procedures to repeal the regulation?

[00:02:07] Speaker 02:
There was a proceeding after the first Court of International Trade case that said there was a problem with the original APA procedure.

[00:02:15] Speaker 02:
Commerce went through another APA procedure to withdraw the regulation prospectively.

[00:02:20] Speaker 02:
That was in 2014, I believe.

[00:02:24] Speaker 03:
And what's the outcome of that?

[00:02:27] Speaker 02:
So the outcome was that it was deemed that they would continue

[00:02:31] Speaker 02:
to have the regulation as withdrawn.

[00:02:34] Speaker 02:
So they haven't withdrawn the regulation?

[00:02:36] Speaker 02:
Yes, they have.

[00:02:38] Speaker 03:
In a formal proceeding?

[00:02:40] Speaker 02:
In a formal proceeding.

[00:02:41] Speaker 02:
They went through another.

[00:02:42] Speaker 02:
Is that final now?

[00:02:43] Speaker 02:
Yes, it is.

[00:02:44] Speaker 02:
So the regulation is withdrawn?

[00:02:45] Speaker 02:
So the regulation is withdrawn.

[00:02:47] Speaker 03:
So we're just talking about the effect of the old regulation in the period here before the formal withdrawal.

[00:02:54] Speaker 02:
Well, before the second withdrawal, the question was whether the first withdrawal was valid.

[00:02:59] Speaker 03:
I don't understand.

[00:03:00] Speaker 03:
The formal APA proceeding.

[00:03:02] Speaker 03:
Correct.

[00:03:02] Speaker 03:
So we're talking just about the effect of this regulation over a limited period of time.

[00:03:07] Speaker 03:
That is correct.

[00:03:08] Speaker 03:
And what's that period of time that's involved?

[00:03:09] Speaker 02:
So the period of time would have been from when the regulation was originally withdrawn, which is December 2008.

[00:03:16] Speaker 02:
I would assume that would go up until 2014 when

[00:03:24] Speaker 02:
The second APA proceeding took place.

[00:03:28] Speaker 03:
How many cases are there like this one that involve the question of the effect before the formal withdrawal, the second proceeding?

[00:03:35] Speaker 02:
There have only been a few that have been raised in the Court of International Trade.

[00:03:39] Speaker 02:
The judges of the Court of International Trade have taken different positions on it.

[00:03:43] Speaker 02:
My understanding is that all the other cases of not participating in them, my understanding is all the other cases wound up being resolved on other grounds.

[00:03:52] Speaker 02:
And so this is really the only case where it's really outcome-determinative whether the regulation is withdrawn or not.

[00:04:03] Speaker 02:
OK, that's helpful.

[00:04:04] Speaker 02:
Thank you.

[00:04:06] Speaker 02:
So I believe the withdrawal of the regulation, I think, also needs to be put into the context of a lengthy proceeding, which is actually still ongoing, in which

[00:04:20] Speaker 02:
The Commerce Department has developed the alternative average to transaction methodology that was provided for for the first time in the 1994 Euro by Round Agreements Act.

[00:04:33] Speaker 02:
So to implement the WTO proceeding, Commerce actually used to use the average to transaction methodology in all investigations and reviews.

[00:04:43] Speaker 02:
Beginning in 1994,

[00:04:45] Speaker 02:
To implement the WTO agreements, Commerce switched to using an average-to-average methodology in original investigations, with the exception that it could use the average-to-transaction methodology in some cases.

[00:04:59] Speaker 02:
And until 2007, it was hardly ever used.

[00:05:04] Speaker 02:
It was hardly even looked at.

[00:05:05] Speaker 02:
Commerce never actually found an occasion when it would actually use the average-to-transaction methodology.

[00:05:11] Speaker 02:
It was only in 2007

[00:05:13] Speaker 02:
when commerce began to implement a series of WTO decisions about zeroing, which I'm sure the court has probably heard more about zeroing than it ever wanted to.

[00:05:26] Speaker 02:
In order to implement that, commerce began to more actively use the average to transaction methodology.

[00:05:31] Speaker 02:
And in fact, this court in the US Steel case in 2010, when it first approved commerce, moving away from

[00:05:38] Speaker 02:
using zeroing and the average to average methodology said, well, the reason commerce always said it needed to do that was to deal with the problem of masked dumping, where some sales are dumped below cost.

[00:05:51] Speaker 02:
They're causing injury.

[00:05:52] Speaker 02:
And we don't want that to be offset by certain sales that are above fair value.

[00:05:58] Speaker 02:
We want to be able to focus on the problems of sales at less than fair value when that's appropriate to do so.

[00:06:04] Speaker 02:
And this court said, well, Congress gave you the alternative

[00:06:08] Speaker 02:
average to transaction methodology to deal with that situation.

[00:06:11] Speaker 03:
Suppose we were to say, okay, we agree, just hypothetically, that we agree with the CIP that this regulation was not withdrawn and remained in effect.

[00:06:24] Speaker 03:
And what's left of your case if we were to reach that conclusion?

[00:06:31] Speaker 02:
Well, even if it were still in effect, I guess I would say there are several things.

[00:06:36] Speaker 02:
First of all,

[00:06:37] Speaker 02:
One question is whether that the failure to withdraw properly actually caused injury to the other side.

[00:06:47] Speaker 03:
Well, let's assume that we also could put it's harmful error, OK?

[00:06:49] Speaker 02:
Well, then in that case, so the regulation is in place.

[00:06:52] Speaker 02:
The regulation didn't impose any obligation on any private party.

[00:06:57] Speaker 02:
The regulation simply said, commerce shall normally do this.

[00:07:01] Speaker 03:
Yeah, and on the remand, commerce interpreted the old regulation.

[00:07:05] Speaker 03:
as requiring the result that it reached.

[00:07:07] Speaker 03:
Are you challenging that commerce determination?

[00:07:10] Speaker 02:
What we're challenging, what we would say, actually what commerce said was, if we applied the old regulation in the way that we intended back in 1997 to do it, setting aside everything that we believe.

[00:07:23] Speaker 03:
I'm trying to understand.

[00:07:24] Speaker 03:
Correct.

[00:07:25] Speaker 03:
You are challenging commerce's determination with respect to the application of the regulation.

[00:07:31] Speaker 02:
Yes, because we believe that the regulation actually gave commerce the flexibility given the changes.

[00:07:38] Speaker 02:
The regulation, excuse me, the regulation as commerce originally envisioned it and described it in the preamble to the 1997 regulation, that's how commerce applied it.

[00:07:48] Speaker 03:
So you're saying they misapplied the regulation.

[00:07:50] Speaker 02:
I believe that they misapplied the regulation.

[00:07:54] Speaker 02:
In particular, they misapplied it based on their own interpretation of the statute

[00:08:00] Speaker 02:
as they explain it in the remand determination itself.

[00:08:03] Speaker 01:
Well, we're reviewing commerce here, right?

[00:08:06] Speaker 01:
Not the CIT.

[00:08:08] Speaker 01:
We're reviewing commerce's decision, which it made under protest, or commerce's view of what the law should be.

[00:08:21] Speaker 01:
We're reviewing, even though it was under protest, that's their decision, which we review.

[00:08:28] Speaker 02:
That is correct.

[00:08:28] Speaker 02:
However, the decision itself says we disagree with the statutory interpretation on which we are making this decision that we are making.

[00:08:37] Speaker 01:
But we have to disregard that because that's reasoning, whereas they made a decision and we have to review the decision.

[00:08:46] Speaker 02:
That's correct.

[00:08:46] Speaker 02:
And I believe that decision is arbitrary and capricious and contrary to law because

[00:08:55] Speaker 02:
It is contrary to commerce's interpretation of the statute and the requirements of the statute, which is deserving of Chevron deference.

[00:09:05] Speaker 03:
Help me.

[00:09:06] Speaker 03:
I'm not following what you're saying.

[00:09:07] Speaker 03:
Correct.

[00:09:08] Speaker 03:
So on the remand, they say, OK, we're stuck with the old regulation.

[00:09:11] Speaker 03:
We're going to apply the old regulation.

[00:09:13] Speaker 03:
And applying the old regulation, we're not going to apply the average transaction method beyond the targeted transactions, right?

[00:09:25] Speaker 02:
Well, but the regulation didn't say that.

[00:09:28] Speaker 03:
I understand.

[00:09:29] Speaker 03:
That's what they did, right?

[00:09:30] Speaker 03:
Correct.

[00:09:30] Speaker 03:
So where's the error in that?

[00:09:34] Speaker 02:
The error in that is that the agency itself believes that, so in the regulation itself, it says commerce shall normally apply the average of transaction method only to this limited group of sales.

[00:09:49] Speaker 02:
But there may be times when it's necessary in order to address mass dumping.

[00:09:54] Speaker 02:
And so Commerce said, this is a case where it is necessary to apply it more broadly to address mass dumping.

[00:10:03] Speaker 02:
This is a case where it is necessary to do that.

[00:10:06] Speaker 03:
They said that in the remand?

[00:10:07] Speaker 03:
They said that in the remand, but what they said was... Wait, show me where they said that in the remand.

[00:10:12] Speaker 03:
I don't understand them to have said that applying the regulation led them to apply the average transaction test to all sales.

[00:10:24] Speaker 02:
You wouldn't be here if they'd done that.

[00:10:28] Speaker 02:
That's correct.

[00:10:29] Speaker 02:
I believe what they said was, and we explained at some length, why the statute required them to apply it more broadly.

[00:10:39] Speaker 02:
And Commerce stated that it agreed with that.

[00:10:43] Speaker 02:
And I'm looking here, and I'm looking at the wrong place now.

[00:10:49] Speaker 02:
So this will be in the appendix now.

[00:10:52] Speaker 02:
We would be beginning, so page 12 of the remand, beginning at page 94 of the appendix.

[00:10:57] Speaker 02:
So they state that it begins under the department's position.

[00:11:01] Speaker 02:
It states, sorry, it's page 94 of the appendix.

[00:11:05] Speaker 02:
We agree in principle with the conceptual framework that the petitioner advocates.

[00:11:11] Speaker 02:
The rationale that we said is, you say, even in the original regulation, even in the preamble to the original regulation, there may be cases

[00:11:23] Speaker 02:
where we need to apply the average to transaction method more broadly.

[00:11:28] Speaker 02:
There may be cases.

[00:11:29] Speaker 02:
And we said, well, this is one of those cases.

[00:11:33] Speaker 02:
You said it needs to be done in cases where the application of the method more broadly is necessary to effectuate the statutory intent.

[00:11:45] Speaker 02:
And you, commerce, have said in your withdrawal of the regulation that you need to do that in certain cases.

[00:11:52] Speaker 02:
You said in the original final determination here that this is one of those cases.

[00:11:57] Speaker 02:
And what they're saying here is that the, and this would now be on page 14, page 96 of the appendix, the first full paragraph at the bottom of the page here.

[00:12:17] Speaker 02:
Or actually, if you go back to the final sentence of the previous paragraph, with the experience that the department has gained, the department found that the regulation restricted its ability to address mass stumping and that it needed to apply the methodology more broadly.

[00:12:36] Speaker 02:
That was the rationale.

[00:12:38] Speaker 03:
That's saying we like the old regulation.

[00:12:40] Speaker 03:
That's not saying that under the old regulation that we'd reach a different result.

[00:12:46] Speaker 02:
Right.

[00:12:47] Speaker 02:
If commerce had applied the old regulation under its old understanding of what the word normally means.

[00:12:57] Speaker 02:
In essence, I think what commerce should have done if they were forced to apply the old regulation is to reinterpret the word normally in light of everything that had developed, all the developments in commerce's practice in the five years since they had repealed the regulation.

[00:13:16] Speaker 02:
And what they said was, we agree with you that those are all relevant considerations.

[00:13:22] Speaker 02:
However, the court found the withdrawal is there.

[00:13:26] Speaker 02:
Therefore, the department must satisfy a different standard as articulated in the 1997 regulations, i.e.

[00:13:33] Speaker 02:
that this pattern be extensive as described in the preamble.

[00:13:37] Speaker 02:
So we're going back to the 1997 commerce understanding of the regulation, not the text of the regulation.

[00:13:45] Speaker 02:
And that's where we feel that the problem is.

[00:13:49] Speaker 02:
Perhaps if you have other questions, I can address them later.

[00:13:51] Speaker 02:
But perhaps I should do that in the rebuttal.

[00:13:53] Speaker 00:
Yes, we'll save you rebuttal time.

[00:13:54] Speaker 02:
Thank you.

[00:13:55] Speaker 00:
Good.

[00:13:58] Speaker 00:
Thank you, Mr. Yelkes.

[00:13:59] Speaker 00:
Mr. House.

[00:14:01] Speaker 04:
May it please the court.

[00:14:02] Speaker 04:
Michael House on behalf of Appellee Precision Fasteners.

[00:14:06] Speaker 03:
Do you agree that this is the only case where the repeal has any significance?

[00:14:11] Speaker 04:
Your Honor, there was a limited time period, we agree, where the unlawful revocation occurred.

[00:14:19] Speaker 03:
What's the answer to my question?

[00:14:20] Speaker 03:
Is this the only remaining case where it makes a difference?

[00:14:25] Speaker 04:
If you don't know, you can say, I don't know.

[00:14:28] Speaker 04:
We know that there is one case that's in the middle of a remand proceeding before the CIT.

[00:14:34] Speaker 04:
This is the Beijing Tianhai case in which the harmless air issue was raised.

[00:14:40] Speaker 04:
That case has yet to reach this court.

[00:14:43] Speaker 03:
So there's one other case.

[00:14:44] Speaker 04:
It may, it possibly may reach this court.

[00:14:47] Speaker 04:
Correct.

[00:14:50] Speaker 04:
The revocation of this substantive rule in December 2008 was an utter failure to abide by the APA's requirement of prior notice and opportunity for comment.

[00:15:05] Speaker 04:
The Commerce Department's failure to do this thwarted the very basic

[00:15:10] Speaker 04:
reason for these APA requirements.

[00:15:12] Speaker 04:
That is, to subject its substantive rulemaking, of which a revocation is, to public debate and also to form a record of its reasons for promulgating the regulation that it is promulgating, and also to assure fairness to the parties.

[00:15:34] Speaker 04:
The D.C.

[00:15:34] Speaker 04:
Circuit and other circuits have consistently emphasized the purpose

[00:15:39] Speaker 04:
of APA notice and comment requirements.

[00:15:42] Speaker 04:
The failure to do so here thwarted all of that.

[00:15:46] Speaker 04:
And as a result, we have a revocation that occurred in December 2008 that was unlawful.

[00:15:52] Speaker 03:
What about the harmless error issue?

[00:15:55] Speaker 04:
Your Honor, we believe that the cases overwhelmingly show that harmless error must be construed very narrowly, particularly in a rulemaking context, which we have here.

[00:16:07] Speaker 03:
Can there be any effort to show that the case would have come out differently if proper notice had been given, right?

[00:16:14] Speaker 04:
We think the CIT was correct in this case and in the several other cases addressing this issue and concluding that it was uncertain whether the outcome would have been the same if proper notice and comment had been provided.

[00:16:26] Speaker 04:
And that's our position as well.

[00:16:30] Speaker 04:
The CIT concluded that no one could really know what the outcome would be.

[00:16:35] Speaker 04:
notice and opportunity was not provided.

[00:16:38] Speaker 04:
So we think that there certainly was error that was not harmless.

[00:16:43] Speaker 04:
And in the context of those circuit court cases that address harmless error in a rulemaking context, it's clear that the court must look at not only the outcome, the potential for a different outcome, but also the procedural aspects of the rulemaking that was followed.

[00:17:03] Speaker 03:
The cases seem to suggest that if it's a really bad error, we're not going to apply harmless error analysis.

[00:17:10] Speaker 03:
But if it's not really bad, a really bad error, maybe we are.

[00:17:14] Speaker 03:
Is that a fair statement?

[00:17:15] Speaker 04:
Well, perhaps really bad could be termed technical.

[00:17:21] Speaker 04:
We've seen that word used in some of these cases.

[00:17:24] Speaker 04:
In our view, this is not a very satisfactory test.

[00:17:30] Speaker 04:
Well, in our view, we think this case isn't difficult to come to the conclusion that this was a really bad or certainly a fundamental error on the part of the agency because the very reason that Commerce gave in its revocation, the only indication we have for why it did this in the revocation notice in trying to justify good cause, it said that we think that our current regulation may

[00:17:59] Speaker 04:
impede the proper relief to domestic industries.

[00:18:04] Speaker 04:
So the only indication we have is that statement by the Commerce Department, not providing any opportunity for notice, and yet the Department did not subject that question to debate, did not subject that question to comment by interested parties, did not pursue that question, yet instead just moved immediately to revoke a substantive regulation.

[00:18:28] Speaker 04:
And we think, however you characterize that on the really bad to not so bad scale, there's no question in our mind that that is a fundamental, harmful error.

[00:18:40] Speaker 04:
Because it goes right to the heart of what APA notice and prior notice and opportunity for comment is all about.

[00:18:48] Speaker 00:
So if we agree with the appellant as to the intricacies of this regulation,

[00:18:57] Speaker 00:
What are the consequences for this particular case, for your position?

[00:19:03] Speaker 04:
Well, Your Honor, in this case, on remand, the CIT ordered the agency to apply the unlawfully withdrawn regulation.

[00:19:15] Speaker 04:
And the agency did so.

[00:19:17] Speaker 04:
And we saw it.

[00:19:18] Speaker 03:
And the answer is that the regulation was repealed.

[00:19:20] Speaker 03:
You lose, right?

[00:19:24] Speaker 04:
I'm sorry.

[00:19:25] Speaker 04:
If the regulation was repealed, you lose.

[00:19:29] Speaker 04:
We don't believe so, Your Honor.

[00:19:31] Speaker 04:
Why not?

[00:19:32] Speaker 04:
Because the statute does not provide the specifics of a methodology and how targeted dumping is to be calculated or analyzed.

[00:19:43] Speaker 04:
And the remaining regulations that were not repealed here, Your Honor, also do not provide... I don't understand what you're saying.

[00:19:51] Speaker 03:
How can you... The Commerce Department

[00:19:53] Speaker 03:
originally said the regulation was repealed, and with the regulation repealed, we find that we should apply this methodology to all sales.

[00:20:07] Speaker 03:
So if the regulation, if the CIT was wrong and the regulation was in fact repealed, how is it that you don't lose?

[00:20:19] Speaker 04:
Well, Your Honor, in our case before the CIT, we raised

[00:20:24] Speaker 04:
a series of challenges to the targeted dumping methodology, which the CIT did not reach.

[00:20:30] Speaker 04:
The CIT put those aside and focused only on the one argument we raised about the invalidity of the revocation.

[00:20:38] Speaker 04:
And so if the court were to reverse the CIT, we don't necessarily lose.

[00:20:45] Speaker 04:
We think there are meritorious arguments that we did present to the CIT, which were stayed, which go to the heart of the methodology

[00:20:53] Speaker 04:
that the department applied in the targeted dumping analysis.

[00:20:57] Speaker 04:
So the CIT hasn't had a chance to visit those arguments and issue a decision.

[00:21:03] Speaker 00:
So you'd go back to where you were several years ago?

[00:21:08] Speaker 04:
I suppose so, Your Honor, yes.

[00:21:11] Speaker 04:
But we don't think that that's the right outcome here, given the clear record of an agency revoking a substantive regulation without

[00:21:22] Speaker 04:
prior notice and opportunity for comment.

[00:21:25] Speaker 04:
And for the reasons that we discussed in our briefs, in our brief and here, we don't think that there's any merit to a claim that this was simply a harmless error.

[00:21:37] Speaker 04:
And furthermore, we also, I think the record clearly shows that the rounds of comments that the agency conducted in 2007 and 2008 don't satisfy

[00:21:49] Speaker 04:
the procedure requirement of notice and comment on the withdrawal of this substantive regulation.

[00:21:56] Speaker 04:
Commerce never mentioned, even hinted, that it was proposing changing, withdrawing, modifying its regulations during those 2007 and 2008 rounds.

[00:22:07] Speaker 04:
Indeed, if you look in the appendix at what Commerce was inviting parties to do was to comment on its analytical framework

[00:22:16] Speaker 04:
within the existing context of the statute and the existing regulations.

[00:22:21] Speaker 04:
So no party engaged in that comment process was put on notice that a modification to Commerce's regulations was even contemplated.

[00:22:33] Speaker 04:
So in the end, we think that there's a clear case of failure to provide a proper notice.

[00:22:40] Speaker 03:
And finally... On the harmless point, doesn't the fact that Commerce ultimately

[00:22:44] Speaker 03:
did engage in a formal proceeding and repeal this regulation show that the same thing would have happened the first time around if they'd applied the proper procedures?

[00:22:55] Speaker 04:
Well, Your Honor, our answer is no.

[00:22:59] Speaker 04:
The unlawful revocation that occurred in December 2008 directly affected our case and several other cases.

[00:23:08] Speaker 04:
And in our view, and we think the correct decision is that the unlawfulness of that withdrawal meant

[00:23:14] Speaker 04:
that that regulation remained in effect until the 2014... Yeah, but I don't think you're addressing my question.

[00:23:20] Speaker 03:
My question is, they ultimately repealed the regulation, right?

[00:23:24] Speaker 03:
Commerce ultimately repealed the regulation.

[00:23:26] Speaker 04:
They ultimately confirmed, yes.

[00:23:27] Speaker 03:
And that's become fine, right?

[00:23:29] Speaker 03:
Correct.

[00:23:30] Speaker 03:
Okay.

[00:23:30] Speaker 03:
So why doesn't the fact that that is what happened when they applied proper procedures

[00:23:36] Speaker 03:
show that that would have been what happened if they'd applied proper procedures in the first place.

[00:23:41] Speaker 04:
Because those parties affected by cases that occurred from the moment that they unlawfully withdrew the regulation until that later point were harmed by an improper process that occurred in December 2008.

[00:23:58] Speaker 04:
And under the APA, once a proper process is conducted,

[00:24:03] Speaker 03:
I don't think you're really addressing my question.

[00:24:06] Speaker 03:
I'm sorry.

[00:24:08] Speaker 03:
What reason is there to believe that if they followed the proper processes the first time around, that they would have reached a different result, given the fact that when they did apply proper processes, they repealed the regulation?

[00:24:22] Speaker 04:
Well, Your Honor, the case law goes to the question.

[00:24:26] Speaker 04:
We think the case law does not support the premise that a later fix, a later cure,

[00:24:33] Speaker 04:
of proper notice and comment regarding the same regulation is sufficient to cure or declare valid what was an improper withdrawal revocation in the first place.

[00:24:49] Speaker 04:
The circuit court cases we've cited in our brief talk about the fact that this would eviscerate the whole purpose of notice and comment APA rulemaking to allow an agency to simply

[00:25:03] Speaker 04:
immediately withdraw a reg without any notice and then later decide, all right, now we're going to do it the right way and take notice and comment and go through the procedures.

[00:25:14] Speaker 04:
That's simply not a cure for what was wrong in the first place.

[00:25:19] Speaker 04:
And we believe that does go to the harmless error question.

[00:25:24] Speaker 04:
We think that in December 2008, when they took this action, it was not certain what would be the outcome with a proper

[00:25:33] Speaker 04:
notice and comment proceeding.

[00:25:36] Speaker 04:
The question that they never presented to the parties was, we have a concern about this particular regulation, we're proposing withdrawing it, we want your input, and there was no substantive debate.

[00:25:49] Speaker 04:
It is not harmless error to conclude that the failure to do that affected in a non-harmless way

[00:26:00] Speaker 04:
the proceedings that fell subject to that regulation in the subsequent period.

[00:26:10] Speaker 04:
Your Honor, that concludes our presentation, unless you have any other questions.

[00:26:15] Speaker 00:
Anything else for Mr. House?

[00:26:17] Speaker 00:
Anything for Mr. House?

[00:26:18] Speaker 00:
Thank you.

[00:26:18] Speaker 00:
Thank you, Mr. House.

[00:26:25] Speaker 00:
Mr. Yaukas?

[00:26:30] Speaker 02:
Thank you, Your Honor.

[00:26:30] Speaker 02:
If I could just briefly address a couple of points.

[00:26:37] Speaker 02:
The issue that no one could have predicted in 2008 what the outcome would have been is, I think, a bit difficult to believe for a couple of reasons.

[00:26:47] Speaker 02:
One is, as Judge Dyck has pointed out, that when Commerce did actually look at this, and actually the citations are in Precision's brief, actually, page 29, footnote 7,

[00:26:58] Speaker 02:
as the citations to the 2013 proposal and 2014 with final non-application of the withdrawn regulation.

[00:27:07] Speaker 02:
But even more is that by withdrawing the regulation, Commerce, and this is in the context of a practice that almost every other aspect of this practice is done not through regulation at Commerce, but through case by case adjudication.

[00:27:24] Speaker 02:
And Commerce's case by case adjudication continued

[00:27:28] Speaker 02:
after this.

[00:27:29] Speaker 02:
And in withdrawing the regulation, Commerce said, we are not necessarily changing our practice.

[00:27:34] Speaker 02:
We are simply untying our hands so we can make a case-by-case determination in the future if we need to.

[00:27:42] Speaker 02:
And in 2010, they did exactly that.

[00:27:45] Speaker 02:
They stated in the Bags case that we cite in our reply brief, they said,

[00:27:52] Speaker 02:
at the preliminary determination of the BAGS cases, they said, well, we're still considering all of the comments we received about the withdrawal of the regulations.

[00:28:01] Speaker 02:
So for our preliminary determination, we will continue to apply the old regulation.

[00:28:06] Speaker 02:
And then in 2010, a year before we even filed our petition, in 2010, Commerce said, all right, we've heard all the comments from everyone.

[00:28:15] Speaker 02:
We're adopting a new practice that is inconsistent with the old regulation.

[00:28:19] Speaker 02:
And we're going to continue to apply that new practice.

[00:28:22] Speaker 02:
That practice was applied in this case.

[00:28:25] Speaker 02:
Precision and Dubai Wire made arguments in this case that this new practice was a bad idea and inconsistent with the statute.

[00:28:34] Speaker 02:
And Commerce rejected those arguments.

[00:28:36] Speaker 02:
That's pages 15 to 18 of the decision memorandum, or pages 77 to 80 of the appendix.

[00:28:43] Speaker 02:
So it's clear that even if Commerce had followed the correct procedure, if in December 2008, instead of saying this is a final rule,

[00:28:52] Speaker 02:
that applies in 30 days, they said, this is a proposed rule.

[00:28:56] Speaker 02:
And then in 2010, when they published in the Federal Register their new practice, they said, all right, from now on, this is our new practice.

[00:29:05] Speaker 02:
We're putting into effect the withdrawal of the old rule.

[00:29:08] Speaker 02:
Nothing in this case would have been changed.

[00:29:10] Speaker 02:
All of that happened a year before we filed our petition.

[00:29:14] Speaker 02:
And so it's clear what would have happened if, in fact, Commerce had

[00:29:20] Speaker 02:
follow the standard 30 days notice and comment, and not found that it had good cause to waive it.

[00:29:27] Speaker 02:
Unless the court has other questions, that's all I have.

[00:29:31] Speaker 00:
Thank you.

[00:29:31] Speaker 00:
Thank you both.

[00:29:32] Speaker 00:
The case is taken under submission.

[00:29:34] Speaker 00:
And that concludes the argued cases for this morning.