Brother Industries, Ltd. v. US

Decision Date12 July 1991
Docket NumberNo. 88-11-00860.,88-11-00860.
PartiesBROTHER INDUSTRIES, LTD. and Brother International Corporation, Plaintiffs, v. The UNITED STATES, Defendant, and Smith Corona Corporation, Intervenor-Defendant.
CourtU.S. Court of International Trade

COPYRIGHT MATERIAL OMITTED

Tanaka Ritger & Middleton, H. William Tanaka, Patrick F. O'Leary and Alice L. Mattice, Washington, D.C., for plaintiffs.

Stuart M. Gerson, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civil Div., U.S. Dept. of Justice, Jane E. Meehan, Office of the Chief Counsel for Import Admin., U.S. Dept. of Commerce, Pamela A. Green, Washington, D.C., of counsel, for defendant.

Stewart and Stewart, Eugene L. Stewart, Terence P. Stewart, James R. Cannon, Jr. and Todd C. Fineberg, Washington, D.C., for intervenor-defendant.

OPINION & ORDER

AQUILINO, Judge:

The plaintiffs have interposed a motion for judgment on the record compiled by the International Trade Administration, U.S. Department of Commerce ("ITA") sub nom. Portable Electric Typewriters From Japan Final Results of Antidumping Duty Administrative Review, 53 Fed.Reg. 40,926 (Oct. 19, 1988). As indicated, the review was carried out under the aegis of an antidumping-duty order for portable electric typewriters ("PETs") from Japan1 and covered the years May 21, 1982 to May 20, 1983, May 21, 1983 to May 20, 1984, May 21, 1984 to April 30, 1985, and May 1, 1985 to April 30, 1986. It resulted in dumping margins for those respective periods of 0.62, 0.32, 0.44 and 4.00 percent for Brother PETs.

Nonetheless, the plaintiffs take the position that the those results are unsupported by substantial evidence on the record and otherwise not in accordance with law within the meaning of 19 U.S.C. § 1516a(b)(1)(B). Their motion alleges that the ITA erred in numerous ways, including (1) applying section 615 of the Trade and Tariff Act of 1984 retroactively to shipments exported before the act's effective date; (2) disregarding a supplemental submission of sales information and relying instead on best information available; (3) failing to adjust for appreciation in value of the Japanese yen in 1985-86; (4) failing to adjust for the full amount of a claimed rebate in computing foreign-market values; (5) double counting corporate advertising expenses in computing exporter sales prices; (6) failing to make a circumstance-of-sale adjustment for certain direct expenses and deducting an incorrect amount of indirect expenses in the exporter-sales-price offset adjustment; (7) double counting packing expenses in constructing values; (8) deducting an incorrect exporter-sales-price offset adjustment as a result of a computer programming error; (9) double counting certain export sales; (10) using incorrect sales dates, exchange rates, and foreign-market values in calculating the dumping margins; (11) failing to delete erroneous home-market sales information from the computer data base; and (12) failing to adjust for home-market commissions in computing foreign market values.

As discussed hereinafter, the defendant acquiesces in remand on some of these points and opposes the others, whereas the intervenor-defendant takes the position that relief is not necessary. Jurisdiction of the court is pursuant to 28 U.S.C. § 1581(c).

I

The Trade Agreements Act of 1979, 19 U.S.C. § 1677b(a)(1) (1980), provided that, in general, the foreign market value of imported merchandise was to be the price, at the time of exportation of such merchandise to the United States, at which it was sold or offered for sale in the principal markets of the country from which exported. Section 615(1) of the Trade and Tariff Act of 1984, Pub.L. No. 98-573, 98 Stat. 2948, 3036-37, deleted the time-of-exportation clause, amending section 1677b(a)(1) to state that the foreign market value of imported merchandise

shall be the price, at the time such merchandise is first sold within the United States by the person for whom (or for whose account) the merchandise is imported to any other person who is not described in subsection (e)(3) of this section with respect to such person —
(A) at which such or similar merchandise is sold, or, in the absence of sales, offered for sale in the principal markets of the country from which exported, in the usual commercial quantities and in the ordinary course of trade for home consumption....

In other words, while time remained an element of this provision, it changed from the moment of exportation to the moment of first sale within the United States, references which are not necessarily synchronous.

In the determination at bar, the ITA relied on this change in reviewing plaintiffs' entries, those which occurred before the enactment in 1984 as well as those thereafter. Brother objected to this approach for merchandise exported prior to October 30, 1984. The agency overruled the objection, Comment 76, responding that it

based exchange rate calculations and home market comparison sale selections for sales date rather than export date. This is consistent with the Department's practice in conducting administrative reviews which were initiated after and covered sales prior to October 30, 1984. The initiation notices of antidumping duty administrative review for the periods subject to this review were published on June 23, 1986 and July 9, 1986. Also, the use of sale date rather than export date is consisitent sic with the final results of the administrative review of this case covering the 1981-82 period (52 FR 1504, January 14, 1987).

53 Fed.Reg. at 40,936. The plaintiffs renew their objection now.

A

If an act is silent or ambiguous with respect to a specific issue, the question for the court is whether or not an agency's approach is based on a permissible construction of the statute. Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843, 104 S.Ct. 2778, 2781-82, 81 L.Ed.2d 694 (1984). In arguing in the affirmative, the defendant relies on section 626 of the 1984 act, providing, in pertinent part:

EFFECTIVE DATES.
(a) Except as provided in subsections (b) and (c), this Act, and the amendments made by it, shall take effect on the date of the enactment of this Act.
(b)(1) The amendments made by sections 602, 609, 611, 612, and 620 shall apply with respect to investigations initiated by petition or by the administering authority under subtitles A and B of title VII of the Tariff Act of 1930 on or after such effective date.
(2) The amendments made by section 623 shall apply with respect to civil actions pending on, or filed on or after, the date of the enactment of this Act....

Since 615 was not included among those sections specified for prospective application, the defendant argues that section 626(a) controls: "if section 626(a) were read any differently than that the amendments are to take effect immediately with respect to all administrative proceedings, then section 626(b) would be superfluous."2

The plaintiffs counter that this is not only impermissible post hoc rationalization, it amounts to a concession that the ITA response to Comment 76, quoted above, is "not colorable in light of the language of ... Section 626(b)(1)."3 And it is that response, the plaintiffs argue, which renders that section superfluous because every provision of the 1984 act is already applicable to proceedings begun on or after its effective date. Since no part of a statute should be construed as superfluous if there is an alternative interpretation, the plaintiffs conclude that the proper reading of section 615 is that it took effect for entries on or subsequent to enactment.

However, to the extent that the defendant regards the review proceedings as begun after the act's effective date, it is not inconsistent with the response to Comment 76 for the defendant to argue that section 615 applied. While that stance may tend to make section 626(b)(1) unnecessary, as the plaintiffs point out, their preferred interpretation would not logically follow even if defendant's original position were untenable. The 1984 act states only that it is to take effect as of the enactment date. Prospective implementation is explicit in 626(b)(1), but that subsection makes no mention of section 615, which therefore took effect on the enactment date. Washington Red Raspberry Comm'n v. United States, 11 CIT 173, 182, 657 F.Supp. 537, 545 (1987), aff'd, 859 F.2d 898 (Fed.Cir. 1988).

On another tack, the plaintiffs allege that the ITA's reliance on section 615 herein is at odds with its practice of not applying that section in reviews of entries predating the 1984 act. They have submitted two attorney affidavits in support of their position.4 One points to a preliminary review proceeding of tapered roller bearings covering the period April 1, 1974 through March 31, 1979 and reported on at 54 Fed. Reg. 12,938 (March 29, 1989), in which "the ITA used `shipment date' to determine currency conversions and foreign market values" for a responding firm with which the affiant claims familiarity. Plaintiffs' Response, Appendix 3 at p. 2. The other affidavit asserts that the proceedings sub nom. Television Receiving Sets, Monochrome and Color, From Japan, 50 Fed. Reg. 24,278 (June 10, 1985), and Portable Electric Typewriters From Japan, 52 Fed. Reg. 1,504 (Jan. 14, 1987), covered pre-1984 review periods, were initiated prior to the effective date of the 1984 act but completed afterwards, and relied on the 1979 act in calculating foreign-market values for the respective goods and comparing them with exporters' sales prices. See Plaintiffs' Response, Appendix 2.

On their face, these references do appear to support the notion of different ITA approaches for review proceedings begun before and after the 1984 act, but the plaintiffs state at page 19 of their memorandum that the "1982-1983, 1983-1984 and 1984-1985 period reviews were all initiated after the effective date of the 1984 Act". Their reply memo, on...

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