40 F.Supp.2d 481 (CIT. 1999), 97-02-00205, Micron Technology, Inc. v. United States

Docket Nº:Court No. 97-02-00205.
Citation:40 F.Supp.2d 481
Party Name:MICRON TECHNOLOGY, INC., Plaintiff, v. The UNITED STATES, Defendant, and LG Semicon Co., Ltd., and LG Semicon America, Inc., Defendant-Intervenors. Slip Op. 99-29.
Case Date:March 25, 1999
Court:Court of International Trade
 
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Page 481

40 F.Supp.2d 481 (CIT. 1999)

MICRON TECHNOLOGY, INC., Plaintiff,

v.

The UNITED STATES, Defendant,

and

LG Semicon Co., Ltd., and LG Semicon America, Inc., Defendant-Intervenors.

Slip Op. 99-29.

Court No. 97-02-00205.

United States Court of International Trade.

March 25, 1999

Hale & Dorr, LLP (Gilbert B. Kaplan, Michael D. Esch, Paul W. Jameson, and Cris R. Revaz), for plaintiff Micron Technology, Inc.

David W. Ogden, Acting Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Michele D. Lynch); Office of the Chief Counsel for Import Administration, United States Department of Commerce (Jeffrey C. Lowe), of counsel, for defendant.

Kaye, Scholer, Fierman, Hays & Handler, LLP (Michael P. House and Raymond Paretzky), for defendant-intervenors LG Semicon Co., and LG Semicon America, Inc.

OPINION

GOLDBERG, Judge.

In this action, the Court reviews two challenges to the Department of Commerce's ("Commerce") Notice of Final Results of Antidumping Administrative Review: Dynamic Random Access Memory Semiconductors of One Megabit or Above From the Republic of Korea, 62 Fed.Reg. 965 (Jan. 7, 1997) (" Final Results "). More specifically, plaintiff, Micron Technology, Inc. ("Micron"), petitioner in the underlying administrative review, contests (1) Commerce's decision not to deduct from constructed export price ("CEP") an amount for indirect selling expenses incurred by respondent, LG Semicon Co., Ltd. and LG Semicon America, Inc. (collectively

Page 482

"LG Semicon"), in its home market; and (2) Commerce's methodology for the level of trade ("LOT") analysis in CEP cases.

The Court exercises jurisdiction to review this motion for judgment on the agency record pursuant to 28 U.S.C. § 1581(c) (1994). The Court sustains the Final Results in part, and remands in part.

I.

BACKGROUND

Micron, a U.S. manufacturer of dynamic random access memory semiconductors ("DRAMS"), filed a petition with Commerce on April 22, 1992, alleging that Korean producers of DRAMS were selling subject merchandise in the United States at less than fair value. Following an antidumping investigation, Commerce published an antidumping order on DRAMS from Korea in May, 1993. See 58 Fed.Reg. 27520 (May 10, 1993).

During the first anniversary month of the order, Micron and three Korean respondents, including LG Semicon, requested an administrative review of the DRAMS order. As a result of the first administrative review, Commerce assigned a dumping margin of 0.00% to LG Semicon. 1 See 61 Fed.Reg. 20,216, 20,222 (May 6, 1996). In the second anniversary month of the order, the parties again requested an administrative review of the order. Commerce initiated its second administrative review of the Korean DRAMS order on June 15, 1995, covering the period from May 1, 1994 through April 30, 1995. See 60 Fed.Reg. 31,448 (June 14, 1995). At the close of the second review, Commerce assigned a de minimis dumping margin to LG Semicon. See Final Results, 62 Fed.Reg. at 968. Micron again appealed these results, and it is this second administrative review that is the subject of the case at bar. 2

Two aspects of Commerce's Final Results are of particular relevance to this appeal. First, Commerce determined that certain indirect selling expenses incurred by LG Semicon in Korea "do not result from or bear relationship to selling activities in the United States." 62 Fed.Reg. at 968 (cmt.4). As a result, Commerce decided that LG Semicon's indirect selling expenses incurred outside the United States should not be deducted from LG Semicon's CEP. 3 The practical effect of Commerce's

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decision was a higher CEP and, thereby, a lower dumping margin.

Second, in accordance with the law as amended by the URAA, Commerce requested information from LG Semicon in order to conduct a level of trade analysis. 4 To assess level of trade in the second review period, Commerce first calculated a "constructed" CEP by deducting indirect selling expenses. Commerce then compared the "constructed" CEP sales to LG Semicon's normal value sales, which in this instance were home market sales. In doing so, Commerce determined that the sales in the two markets were at different levels of trade. Yet, because there was no basis upon which to determine if price differences existed between the two levels of trade, Commerce granted LG Semicon a "CEP offset," thereby reducing normal value by an amount for home market indirect selling expenses. See supra note 4.

Micron challenges both actions by Commerce. First, Micron contends that Commerce erred as a matter of law when it declined to deduct indirect selling expenses incurred outside the United States from CEP. Second, Micron maintains that Commerce's decision to adjust LG Semicon's CEP prior to making the level of trade comparison was methodologically unsound and contrary to law. Commerce and LG Semicon oppose both challenges to the Final Results.

II.

STANDARD OF REVIEW

Commerce's determination will be sustained if it is supported by substantial evidence on the record and is otherwise in accordance with law. See 19 U.S.C. § 1516a(b)(1)(B) (1994).

III.

DISCUSSION

A. Commerce's Decision Not to Deduct Indirect Selling Expenses Incurred Outside the United States Was In Accordance...

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