Nmb Singapore Ltd. v. U.S.

• Decision Date: 18 February 2009
• Docket Number: No. 2008-1191.,No. 2008-1187.,2008-1187.,2008-1191.
• Citation: 557 F.3d 1316
• Parties: NMB SINGAPORE LTD., Plaintiff, and NSK Corporation and NSK, Ltd., Plaintiffs-Appellees, and JTEKT Corporation and Koyo Corporation of U.S.A., Plaintiffs-Appellants, v. UNITED STATES, Defendant-Appellee, and The Timken Company, Defendant-Cross Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

557 F.3d 1316

NMB SINGAPORE LTD., Plaintiff, and NSK Corporation and NSK, Ltd., Plaintiffs-Appellees, and JTEKT Corporation and Koyo Corporation of U.S.A., Plaintiffs-Appellants, v. UNITED STATES, Defendant-Appellee, and The Timken Company, Defendant-Cross Appellant.

No. 2008-1187.

No. 2008-1191.

United States Court of Appeals, Federal Circuit.

February 18, 2009.

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

Jill Caiazzo Sidley Austin LLP, of Washington, DC, argued for plaintiff-appellant. With him on the brief was Neil R. Ellis. Of counsel was Lawrence R. Walders.

David F. D'Alessandris, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, argued for defendant-appellee. With him on the brief were

Gregory G. Katsas, Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel on the brief was Deborah R. King, United States Department of Commerce, of Washington, DC.

Eric P. Salonen, Stewart and Stewart, of Washington, DC, argued for defendant/cross appellant. With him on the brief were Terence P. Stewart and Patrick J. McDonough. Of counsel was Philip A. Butler.

Before MICHEL, Chief Judge, SCHALL, and MOORE, Circuit Judges.

MICHEL, Chief Judge.

JTEKT Corporation and Koyo Corporation of U.S.A. (collectively, "JTEKT") and the Timken Company ("Timken") have cross-appealed different aspects of the Court of International Trade's judgment affirming a final decision of the Department of Commerce ("Commerce"). On appeal, JTEKT argues that Commerce ignored evidence and argument JTEKT presented, and that Commerce's finding that dumping was likely to continue (and the resulting continuation of the anti-dumping duty) should be vacated. In a cross-appeal, Timken argues that Commerce lacked substantial evidence to justify recalculating (and reducing) dumping margins for the Japanese parties and also impermissibly deviated in several respects from its established methodology when it decided to recalculate their dumping margins. Oral argument was held on December 5, 2008. We affirm the Court of International Trade's judgment in JTEKT's appeal, but vacate and remand in Timken's cross-appeal.

I. BACKGROUND

NSK Corporation and NSK, Ltd. (collectively, "NSK"), NTN Corporation and NTN USA (collectively, "NTN"), JTEKT, and Timken all manufacture ball bearings. NTN, NSK, and JTEKT are Japanese manufacturers, while Timken is a domestic entity.¹

In 1988, Commerce began an investigation into whether Japanese-made antifriction bearings were being dumped in the United States. In 1989, Commerce determined that Japanese manufacturers were dumping bearings and issued an antidumping order. Antifriction Bearings (Other than Tapered Roller Bearings) & Parts Thereof from Japan, 54 Fed.Reg. 19,101 (Dep't of Commerce May 3, 1989) (final determination). Commerce subjected the Japanese manufacturers to anti-dumping duties as follows: JTEKT, 73.55%; NSK, 42.99%; and NTN, 21.36%. Id. at 19,108.

Commerce must periodically reconsider such anti-dumping orders, 19 U.S.C. § 1675(c)(1), in what are termed "sunset reviews." Agro Dutch Indus. v. United States, 508 F.3d 1024, 1028 (Fed.Cir.2007). On appeal are the results of the second sunset review of the anti-dumping order against Japanese antifriction bearing imports.

In late 2005, Commerce issued a preliminary second sunset review decision in which Commerce determined (1) that dumping was likely to continue, and (2) that the margins applicable to the Japanese companies should remain unchanged. Ball Bearings & Parts Thereof from Japan & Sing., 70 Fed.Reg. 76,754 (Dep't of Commerce Dec. 28, 2005) (prelim.results); Ball Bearings & Parts Thereof from Japan & Sing., 70 ITADOC 76,754, available at http://ia.ita.doc.gov/frn/summary/multiple/05-24510-1.pdf (Dep't of Commerce Dec. 28, 2005) (prelim. results memo.) ("Preliminary Memo").² Commerce based its preliminary decision to leave the anti-dumping order in place on its findings "that the total weight and value of complete Japanese ball bearings imported decreased substantially post-order and remain well below pre-order levels" and "that dumping continues at above de minimis levels." Preliminary Memo, slip op. at 10. Commerce based its preliminary decision to not recalculate the applicable margins on its finding that "above de minimis" dumping persisted with the order in place. Id. at 12.

Commerce thereafter received arguments from interested parties, including JTEKT and Timken. In a final decision released in the spring of 2006, Commerce reaffirmed—although with an altered rationale—that dumping was likely to continue (a finding JTEKT contests on appeal). See Ball Bearings & Parts Thereof from Japan & Sing., 71 Fed.Reg. 26,321, 26,322 (Dep't of Commerce May 4, 2006) (final results) ("Final Results"); Ball Bearings & Parts Thereof from Japan & Sing., http://ia.ita.doc.gov/frn/summary/ MULTIPLE/E6-6763-1.pdf, slip op. at 5 (Dep't of Commerce May 4, 2006) (final results memo.) ("Final Memo").³ Commerce mentioned only "above de minimis" levels of dumping in support of its final decision to leave the anti-dumping order in place, and did not discuss import volumes. Final Memo, slip op. at 5. Reversing course, Commerce also determined that the margins applicable to the Japanese respondents should be lower than before the anti-dumping order (a finding Timken contests). See id. at 7-10, 12. Commerce based this decision on its findings that the Japanese respondents' dumping margins had decreased during the order while their import volumes had increased or remained steady. Id. at 9-10.

The Court of International Trade affirmed Commerce's final decision in all respects. NMB Singapore Ltd. v. United States, 533 F.Supp.2d 1244 (Ct. Int'l Trade 2007). We have jurisdiction over appeals from the Court of International Trade pursuant to 28 U.S.C. § 1295(a)(5).

II. DISCUSSION

A. Standard of review

The Federal Circuit reviews Commerce's anti-dumping orders using the same standard of review used by the Court of International Trade. NSK Ltd. v. United States, 481 F.3d 1355, 1359 (Fed.Cir. 2007); NTN Bearing Corp. of Am. v. United States, 368 F.3d 1369, 1372 (Fed.Cir. 2004). This court will uphold Commerce's decisions unless they are "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i); see also Timken U.S. Corp. v. United States, 434 F.3d 1345, 1350 (Fed.Cir.2006).

Commerce must explain the basis for its decisions; while its explanations do not have to be perfect, the path of Commerce's decision must be reasonably discernable to a reviewing court. Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983) ("State Farm") ("We will . . . `uphold a decision of less than ideal clarity if the agency's path may reasonably be discerned.'" (quoting Bowman Transp. v. Ark.-Best Freight Sys., 419 U.S. 281, 286, 95 S.Ct. 438, 42 L.Ed.2d 447 (1974))). Specifically in the anti-dumping context, a final determination by Commerce must include "an explanation of the basis for its determination that addresses relevant arguments[ ] made by interested parties who are parties to the investigation or review." 19 U.S.C. § 1677f(i)(3)(A). However, Congress did not intend for enactment of § 1677f(i) to alter the law; § 1677f(i) is instead a partial codification of the Supreme Court's standard for judicial review of administrative decisions from State Farm. Timken U.S. Corp. v. United States, 421 F.3d 1350, 1355 (Fed.Cir.2005).

B. JTEKT's appeal

JTEKT makes two arguments against Commerce's decision to continue the antidumping order. First, JTEKT argues that Commerce did not consider—in violation of Commerce's statutory mandate— evidence JTEKT submitted, specifically, (1) JTEKT's evidence that its import levels did not decrease substantially and thus could be considered "steady" and (2) evidence that a U.S. recession caused decreases in JTEKT's import levels around 2001. Second, JTEKT argues that even if Commerce may disregard certain portions of JTEKT's evidence, Commerce's decision to continue the anti-dumping order is not supported by substantial evidence. However, these two arguments overlap and we address them simultaneously.⁴ Both the United States and Timken oppose JTEKT on appeal.

In deciding whether lifting an anti-dumping order would be likely to lead to continued or resumed dumping, Commerce is required by statute to consider previous estimates of dumping margins and the volume of imports pre and post-order. 19 U.S.C. § 1675a(c)(1). The statute does not explain how this comparison is to indicate to Commerce whether an anti-dumping order should be lifted, but a report by the House of Representatives on the Uruguay Round Agreements Act, H.R.Rep. No. 103-316 (1994), as reprinted in 1994 U.S.C.C.A.N. 4040, commonly known as the Statement of Administrative Action (or "SAA"), is, by statute, an "authoritative expression" of the interpretation of that act, including § 1675a. 19 U.S.C. § 3512(d); see also Timken, 421 F.3d at 1354 n. 2. According to the SAA, "declining (or no) dumping margins accompanied by steady or increasing imports may indicate that foreign companies do not have to dump to maintain market share in the United States and that dumping is less likely to continue or recur if the order were revoked." 1994 U.S.C.C.A.N. at 4213-14.

A regulation provides that Commerce "will revoke" an anti-dumping order during a sunset review if Commerce "determines that revocation or termination is not likely to lead to continuation or recurrence of . . . dumping." 19 C.F.R. § 351.222(i)(1)(ii). The SAA provides:

The Administration believes that existence of dumping margins after the order, or the...