Nsk Ltd. v. U.S.

• Decision Date: 03 January 2005
• Docket Number: SLIP OP. 05-1.,Court No. 03-00437.
• Citation: 358 F.Supp.2d 1276
• Parties: NSK LTD., NSK Corp., NSK Precision America, Inc., et al. Plaintiffs, v. UNITED STATES, Defendant, and Timken U.S. Corp., et al. Defendant-Intervenors.
• Court: U.S. Court of International Trade

358 F.Supp.2d 1276

NSK LTD., NSK Corp., NSK Precision America, Inc., et al. Plaintiffs, v. UNITED STATES, Defendant, and Timken U.S. Corp., et al. Defendant-Intervenors.

SLIP OP. 05-1.

Court No. 03-00437.

United States Court of International Trade.

January 3, 2005.

COPYRIGHT MATERIAL OMITTED

Crowell & Moring, LLP, (Matthew Philip Jaffe, Robert A. Lipstein, and Grace W. Lawson) for Plaintiffs and Defendant-Intervenors NSK Ltd., NSK Corp., NSK Precision America, Inc.

Barnes, Richardson & Colburn, Chicago, IL, (Donald J. Unger, Kazumune V. Kano, and Carolyn D. Amadon) for Plaintiffs and Defendant-Intervenors NTN Corp., NTN Bearing Corp. of America, American NTN Bearing Manufacturing Corp., NTN Driveshaft, Inc., and NTN-BCA Corp.

Stewart and Stewart, Washington, DC, (Terence P. Stewart, William A. Fennell, and Lane S. Hurewitz) for Plaintiff and Defendant-Intervenor Timken U.S. Corp.

Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director; Jeanne E. Davidson, Deputy Director; Paul D. Kovac and Claudia Burke, Attorneys, U.S. Department of Justice, Civil Division, Commercial Litigation Branch; and Peter G. Kirchgraber, Philip Curtin, Elizabeth Doyle, Marisa Goldstein, Peter Kaldes, Barbara Tsai, Attorney Advisors, Office of Chief Counsel for Import Administration, U.S. Department of Commerce, for Defendant United States.

OPINION

WALLACH, Judge.

I INTRODUCTION

In this action, Plaintiffs NSK Ltd., NSK Corp., and NSK Precision America, Inc. (collectively, "NSK"); NTN Corp., NTN Bearing Corp. of America, American NTN Bearing Manufacturing Corp., NTN Driveshaft, Inc., and NTN-BCA Corp. (collectively, "NTN"); and Timken U.S. Corp. ("Timken") challenge the final results of an administrative review issued by the United States Department of Commerce ("Commerce") in Ball Bearings and Parts Thereof from France, Germany, Italy, Japan, and Singapore: Final Results of Antidumping Duty Administrative Reviews, Rescission of Administrative Review in Part, and Determination Not to Revoke Order in Part, 68 Fed.Reg. 35,623 (June 16, 2003) ("Final Results"). The court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (2003). For the following reasons, Commerce's determination is sustained.

II BACKGROUND

On May 15, 1989, Commerce published in the Federal Register the final results in the antidumping duty orders on ball bearings ("BBs") and parts thereof from Japan. Antidumping Duty Orders: Ball Bearings, Cylindrical Roller Bearings, and Spherical Plain Bearings, and Parts Thereof From Japan, 54 Fed.Reg. 20,904 (May 15, 1989) ("Original Investigation"). On June 25, 2002, Commerce published a notice of initiation of the thirteenth administrative review of the subject Japanese BBs, covering a period of review ("POR") of May 1, 2001, through April 30, 2002. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 67 Fed.Reg. 42,753 (June 25, 2002) ("Initiation of the Thirteenth Administrative Review").

On March 10, 2003, Commerce published the preliminary results in this administrative review in Ball Bearings and Parts Thereof From Japan: Preliminary Results of Antidumping Duty Administrative Review, Partial Rescission of Administrative Review, and Notice of Intent To Rescind Administrative Review, 68 Fed.Reg. 11,357 (March 10, 2003) ("Preliminary Results"). Commerce issued the Final Results on June 16, 2003. The scope of this order covers antifriction balls, ball bearings with integral shafts, ball bearings (including radial ball bearings) and parts thereof, and housed or mounted ball bearing units and parts thereof.¹ Final Results, 68 Fed.Reg. at 35,623. In the Final Results, Commerce found a 2.68% weighted-average margin for NSK Japan and 4.51% for NTN. See id. at 35,625.

III STANDARD OF REVIEW

This court will sustain any determination, finding, or conclusion of Commerce unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. 1516a(b)(1)(B) (2004); Magnesium Corp. of Am. v. United States, 166 F.3d 1364, 1368 (Fed.Cir.1999). "[S]ubstantial evidence is more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 95 L.Ed. 456 (1951) (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 217, 59 S.Ct. 206, 83 L.Ed. 126 (1938)). "This is something less than the weight of the evidence, and the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence." Consolo v. Fed. Mar. Comm'n, 383 U.S. 607, 619-20, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966) (citing Keele Hair & Scalp Specialists Inc. v. FTC, 275 F.2d 18, 21 (5th Cir.1960)).

In looking at Commerce's statutory interpretation, this court must go through a two-step analysis. Chevron U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 842-43, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). The court examines, first, whether "Congress has directly spoken to the precise question at issue," in which case courts, "must give effect to the unambiguously expressed intent of Congress." Id. at 842-43, 104 S.Ct. 2778; see Household Credit Servs. v. Pfennig, 541 U.S. 232, 124 S.Ct. 1741, 1746-47, 158 L.Ed.2d 450 (2004). Whenever Congress has "explicitly left a gap for the agency to fill," the agency's regulation is "given controlling weight unless [it is] arbitrary, capricious, or manifestly contrary to the statute." Chevron, 467 U.S. at 843-44, 104 S.Ct. 2778. "When faced with a problem of statutory construction, this Court shows great deference to the interpretation given the statute by the officers or agency charged with its administration. `To sustain the [agency's] application of this statutory term, we need not find that its construction is the only reasonable one, or even that it is the result we would have reached had the question arisen in the first instance in judicial proceedings.'" Udall v. Tallman, 380 U.S. 1, 16, 85 S.Ct. 792, 13 L.Ed.2d 616 (1965) (quoting Unemployment Comm'n v. Aragon, 329 U.S. 143, 153, 67 S.Ct. 245, 91 L.Ed. 136 (1946)).

IV ANALYSIS

A Commerce's Practice of Zeroing Is Supported by Substantial Evidence and Is In Accordance with Law

NSK argues that Commerce's decision to assign a zero margin to export price ("EP") or constructed export price ("CEP") sales made above normal value ("NV")² is impermissible under U.S. antidumping law. NSK's Motion for Judgment on the Agency Record ("NSK's Motion") at 7. NSK argues that 19 U.S.C. § 1677(34) (2003) "reformulates the first requirement of section 731" that U.S. sales below fair value are dumped while those that are above fair value are not. Id. at 10. NSK further claims that the definition of dumping margin in 19 U.S.C. § 1677(35)(A)³ "reaffirms that dumping only exists when NV exceeds the EP or CEP of the subject merchandise, which section 771(25) defines as `class or kind of merchandise within the scope of an investigation, a review.'" Id. (emphasis in original). NSK thus concludes that the focus of any antidumping proceeding is the class of merchandise involved. Id. (emphasis added). In turn, pursuant to 19 U.S.C. § 1673(1) (2003), NSK claims that "Commerce may impose antidumping duties only when the determination is that a class or kind of foreign merchandise is being, or is likely to be, sold in the United States at less than fair value." Id. at 8 (emphasis in original).

NSK cites Taiwan Semiconductors Indus. Ass'n v. Int'l Trade Comm'n, 266 F.3d 1339, 1345 (Fed.Cir.2001), in which the Federal Circuit stated that the U.S. International Trade Commission ("ITC") must analyze "`contradictory evidence or evidence from which conflicting inferences could be drawn... to ensure that the subject imports are causing the injury in a tangential or minimal way.'" Id. at 9; Issues and Decision Memorandum at 11. NSK notes that the court in Taiwan Semiconductors said that injury to domestic industry may not be present merely in the face of less than fair value imports. Issues and Decision Memorandum at 11. NSK argues that Commerce's zeroing methodology impairs analysis of "contradictory evidence or evidence from which conflicting inference would be drawn" that would allow for an unbiased margin calculation. Id. at 11. Commerce's methodology, NSK posits, violates the statute because it "trivializes" U.S. sales above fair value as a "single U.S. sale below NV can produce a dumping margin, even though there exist hundreds of sales for which the opposite is true." NSK's Motion at 8-9. NSK suggests that Commerce's methodology may lead to punitive antidumping margins, disallowed by the Federal Circuit.

Defendant argues that Commerce's zeroing practice is in accordance with U.S. antidumping law. Defendant's Response in Opposition to Timken Company's, NSK's, and NTN's Motions for Judgment Upon the Agency Record ("Defendant's Response") at 14-15. Defendant states that this practice has been upheld by this court and the Federal Circuit in a number of cases. In particular, Defendant cites to Timken Co. v. United States, 354 F.3d 1334 (Fed.Cir.2004), in which the Federal Circuit upheld Commerce's zeroing methodology as reasonable under the statutory scheme. Id. at 15.

Defendant further argues that NSK's position that Commerce's margin-calculation methodology violates 19 U.S.C. § 1673 is without substance. First, Defendant refutes NSK's argument that its zeroing methodology violates 19 U.S.C. § 1673 by arguing that 19 U.S.C. § 1673 applies to investigations whereas 19 U.S.C. § 1675 covers administrative reviews and requires the dumping analysis to be conducted on an entry-by-entry basis. Issues and Decision Memorandum at 15. Second, Defendant argues that NSK's reliance on Taiwan Semiconductors is erroneous since the Federal Circuit in that case addressed statutory injury in an...