Nsk Ltd. v. U.S., 2007-1114.

• Decision Date: 14 December 2007
• Docket Number: No. 2007-1129.,No. 2007-1114.,No. 2007-1128.,2007-1114.,2007-1128.,2007-1129.
• Citation: 510 F.3d 1375
• Parties: NSK LTD., NSK Corporation, and NSK Precision America, Inc., Plaintiffs-Appellants, and American NTN Bearing Manufacturing Corporation, NTN-BCA Corporation, NTN-Driveshaft, Inc., NTN Bearing Corporation of America, and NTN Corporation, Plaintiffs-Appellants, and Koyo Corporation of U.S.A. and Koyo Seiko Co., Ltd., Plaintiffs-Appellants, v. UNITED STATES, Defendant-Appellee, and Timken U.S. Corporation, Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

510 F.3d 1375

NSK LTD., NSK Corporation, and NSK Precision America, Inc., Plaintiffs-Appellants, and American NTN Bearing Manufacturing Corporation, NTN-BCA Corporation, NTN-Driveshaft, Inc., NTN Bearing Corporation of America, and NTN Corporation, Plaintiffs-Appellants, and Koyo Corporation of U.S.A. and Koyo Seiko Co., Ltd., Plaintiffs-Appellants, v. UNITED STATES, Defendant-Appellee, and Timken U.S. Corporation, Defendant-Appellee.

No. 2007-1114.

No. 2007-1128.

No. 2007-1129.

United States Court of Appeals, Federal Circuit.

December 14, 2007.

Matthew P. Jaffe, Crowell & Moring LLP, of Washington, DC, for plaintiffs-appellants NSK Ltd, NSK Corporation, and NSK Precision America, Inc. With him on the brief were Robert A. Lipstein and Alexander H. Schaefer. Of counsel was Sobia Haque.

Diane A. MacDonald, Baker & McKenzie LLP, of Chicago, IL, argued for plaintiffs-appellants American NTN Bearing Manufacturing Corporation, et al. With her on the brief were Donald J. Unger and Louisa V. Carney.

Neil R. Ellis, Sidney Austin LLP, of Washington, DC, argued for plaintiffs-appellants Koyo Corporation, et al. With him on the brief was Neil C. Pratt. Of counsel were Jill Caiazzo and Lawrence R. Walders.

Claudia Burke, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, argued for defendant-appellee United States. On the brief were Peter D. Keisler, Acting Attorney General, Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, and Michael Panzera, Attorney. Of counsel on the brief were Jennifer I. Johnson, Mykhaylo Gryzlov, and Nithya Nagarajan, Attorneys, United States Department of Commerce, Office of Chief Counsel for Import Administration, of Washington, DC.

Geert DePrest, Stewart and Stewart, of Washington, DC, argued for defendant-appellee Timken U.S. Corporation. With him on the brief were Terence P. Stewart and William A. Fennell. Of counsel was Lane S. Hurewitz.

James P. Durling, Vinson & Elkins LLP, of Washington, DC, for Amicus Curiae. With him on the brief were Matthew R. Nicely and David T. Hardin.

Before LOURIE, DYK, and PROST, Circuit Judges.

PROST, Circuit Judge.

NSK Ltd., NSK Corporation, and NSK Precision America, Inc. (collectively, "NSK"), American NTN Bearing Manufacturing Corporation, NTN-BCA Corporation, NTN-Driveshaft, Inc., NTN Bearing Corporation of America, and NTN Corporation (collectively, "NTN"), and Koyo Corporation of U.S.A. and Koyo Seiko Co., Ltd. (collectively, "Koyo") appeal a January 31, 2006, decision of the United States Court of International Trade affirming various determinations made by the United States Department of Commerce ("Commerce") in the administrative review of the antidumping duty order on antifriction bearings imported from Japan, covering the period of May 1, 2002, through April 30, 2003, and dismissing a challenge by NSK to Commerce's recommendation to change model-match methodologies in future reviews. NSK Ltd. v. United States, 416 F.Supp.2d 1334 (Ct. Int'l Trade 2006) ("NSK I"). Koyo and NTN also appeal an October 23, 2006, decision of the Court of International Trade affirming other determinations made by Commerce as part of the administrative review. NSK Ltd. v. United States, 462 F.Supp.2d 1254 (Ct. Int'l Trade 2006) ("NSK II"). Because Commerce's determinations are supported by substantial evidence and in accordance with law, and because NSK's challenge was not ripe for adjudication, we affirm.

I. BACKGROUND

On September 15, 2004, Commerce published in the Federal Register the final results of the administrative review of the antidumping duty orders on antifriction bearings and parts thereof from France, Germany, Italy, Japan, Singapore, and the United Kingdom, covering the period from May 1, 2002, through April 30, 2002. Antifriction Bearings and Parts Thereof From France, Germany, Italy, Japan, Singapore, and the United Kingdom: Final Results of Antidumping Duty Administrative Reviews, Rescission of Administrative Reviews in Part, and Determination to Revoke Order in Part, 69 Fed.Reg. 55,574 ("Final Results"). In these results, Commerce found weighted-average dumping margins for Koyo, NTN, and NSK of 5.56%, 2.74%, and 2.46%, respectively. Id. at 55,580. Koyo, NTN, and NSK each filed a challenge to Commerce's determinations, and their cases were consolidated into a single action on March 4, 2005.

On January 31, 2006, the Court of International Trade affirmed various determinations made by Commerce that had been challenged by Koyo, NTN, and NSK, including Commerce's practice of zeroing negative dumping margins in its weighted-average dumping margin calculations. NSK I, 416 F.Supp.2d at 1338-39. The Court of International Trade also dismissed for lack of jurisdiction a challenge by NSK to a recommendation by Commerce that it change its model-match methodology in future administrative reviews. Id. at 1339-40. The Court of International Trade, however, rejected Commerce's differential treatment of positive and negative home market billing adjustments by Koyo that Commerce contended were equally distortive, and remanded Commerce's determination to include certain small-volume, high-profit sales by NTN in its value calculations for further explanation. Id. at 1340-44. In response, Commerce rejected both Koyo's positive and negative billing adjustments and provided further explanation for its inclusion of NTN's small-volume, high-profit sales. The Court of International Trade affirmed. NSK II, 462 F.Supp.2d at 1260. Koyo, NTN, and NSK now appeal to this court. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(5).

II. DISCUSSION

A. Standard of Review

This court reviews antidumping determinations made by Commerce using the same standard of review used by the Court of International Trade. F.lli De Cecco Di Filippo Fara S. Martino S.p.A. v. United States, 216 F.3d 1027, 1031 (Fed. Cir.2000). This court will uphold Commerce's determinations unless they are unsupported by "substantial evidence on the record, or otherwise not in accordance with law." Id. Questions of law, including questions of statutory interpretation, are reviewed de novo; evidentiary decisions are reviewed for abuse of discretion; and findings of fact are reviewed for clear error. Id.

B. Commerce's Zeroing of Negative Dumping Margins

On appeal, NSK, NTN, and Koyo each challenge Commerce's long-standing practice of "zeroing" negative dumping margins when computing antidumping duties.

Under the antidumping statute, Commerce is required to impose antidumping duties on imported merchandise that "is being, or is likely to be, sold in the United States at less than fair value" to the detriment of a domestic industry. 19 U.S.C. § 1673. Commerce calculates these antidumping duties by first calculating the amount by which the price a producer charges for the subject merchandise in its home market, i.e., the "normal value," exceeds the price charged in the United States, i.e., the "export price." This amount is referred to as the "dumping margin." Commerce then calculates a weighted average of the dumping margins for the producer/exporter by dividing the aggregate dumping margins for that producer/exporter by the aggregate export prices charged by that producer/exporter. Id. § 1677(35)(B).

Occasionally, the price charged for the subject merchandise in the United States is greater than the price charged for the same merchandise in the home market. This results in a negative dumping margin for that merchandise. In these situations, Commerce sets the negative dumping margins to zero when calculating the weighted average dumping margin. By doing so, the sum of the dumping margins calculated on the individual transactions is not reduced by the negative amount of the dumping margins. This practice is referred to as "zeroing" and has been repeatedly upheld by this court. See, e.g., Timken Co. v. United States, 354 F.3d 1334 (Fed.Cir.2004), cert. denied 543 U.S. 976, 125 S.Ct. 412, 160 L.Ed.2d 352 (2004); Corus Staal BV v. Dep't of Commerce, 395 F.3d 1343 (Fed.Cir.2005), cert. denied 546 U.S. 1089, 126 S.Ct. 1023, 163 L.Ed.2d 853 (2006); Corus Staal BV v. United States, 502 F.3d 1370 (Fed.Cir.2007).

Recently, however, the Government of Japan initiated a World Trade Organization ("WTO") challenge of Commerce's zeroing practice. On January 9, 2007, the WTO Appellate Body issued a decision in which it found that Commerce's zeroing practice, as applied to the administrative review at issue in this case, is inconsistent with the United States' international obligations. See Appellate Body Report, United States — Measures Relating to Zeroing and Sunset Reviews, WT/DS322/AB/R (Jan. 9, 2007). The WTO Dispute Resolution Body adopted this decision on January 23, 2007. In response, on February 20, 2007, the United States issued a statement that "it intends to comply in this dispute with its WTO obligations and will be considering carefully how to do so." See Press Release, U.S. Mission to the United Nations in Geneva, U.S. Statements at the WTO Dispute Settlement Body, Delivered by David P. Shark, Deputy Chief of Mission U.S. Mission to the WTO (Feb. 20, 2007).

In light of this statement, NSK, NTN, and Koyo seek to have this case remanded to Commerce to allow the agency to implement the WTO decision. Commerce, however, opposes such a remand. Although Commerce has stated that it intends to comply with its WTO obligations, it contends that it only plans to discontinue zeroing in investigations, not in administrative reviews such as this one.

As stated by this court in Corus Staal, "we ... refuse to overturn Commerce's zeroing practice based on any ruling by the WTO or other international body unless and until such ruling has been adopted pursuant to the specified statutory scheme." 395 F.3d at 1349; cf. Suramerica de Aleaciones Laminadas, C.A. v. United States, 966 F.2d 660, 668 (Fed.Cir.1992) ("While we acknowledge Co...