Makita Corp. v. U.S.
| Citation | 974 F.Supp. 770 |
| Decision Date | 08 July 1997 |
| Docket Number | Slip Op. 97-92.,Court No. 93-08-00450.,Court No. 93-08-00451. |
| Parties | MAKITA CORPORATION, Makita U.S.A., Inc., and Makita Corporation of America, Plaintiffs, v. UNITED STATES of America, and United States Department of Commerce (International Trade Administration), Defendants, and Black & Decker (U.S.) Inc., Intervenor-Defendant. MAKITA CORPORATION, Makita U.S.A., Inc., and Makita Corporation of America, Plaintiffs, v. UNITED STATES of America, and United States International Trade Commission, Defendants, and Black & Decker (U.S.) Inc., Intervenor-Defendant. |
| Court | U.S. Court of International Trade |
Verner, Liipfert, Bernhard, McPherson and Hand (William A. Zeitler, Douglas W. Hall, Steven R. Johnson), Washington, DC, for plaintiffs.
Frank W. Hunger, Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division U.S. Department of Justice (Jeffrey J. Bernstein); Office of the Chief Counsel for Import Administration, U.S. Department of Commerce (Linda A. Andros), Washington, DC, of counsel, for defendants United States and U.S. Department of Commerce.
Office of the General Counsel, U.S. International Trade Commission (Lyn M. Schlitt, James A. Toupin, Robin L. Turner), Washington, DC, for defendant U.S. International Trade Commission.
Stroock & Stroock & Lavan (James Taylor, Jr., Will E. Leonard, Washington, DC, and Alexei J. Cowett, New York City), for intervenor-defendant.
In these actions, the plaintiffs have interposed motions for judgments on the records compiled by the International Trade Administration, U.S. Department of Commerce ("ITC") sub nom. Final Determinations of Sales at Less Than Fair Value: Professional Electric Cutting Tools and Professional Electric Sanding/Grinding Tools from Japan, 58 Fed.Reg. 30,144 (May 26, 1993), as amended, Antidumping Duty Order and Amended Final Determination: Professional Electric Cutting Tools from Japan, 58 Fed.Reg. 37,461 (July 12, 1993), and by the U.S. International Trade Commission ("ITC") sub nom. Professional Electric Cutting and Sanding/Grinding Tools from Japan, 58 Fed.Reg. 37,967 (July 14, 1993).
Jurisdiction of the court is pursuant to 28 U.S.C. § 1581(c). Its standard for review of the contested agency determinations is whether they are unsupported by substantial evidence on the record or otherwise not in accordance with law. 19 U.S.C. § 1516a(b)(1)(B).
In its antidumping-duty petition filed with the ITA and ITC, Black & Decker (U.S.) Inc. alleged the subject to be professional electric cutting tools and sanding/grinding tools:
Professional electric cutting tools have blades or other cutting devices used for cutting wood, metal, and other materials. [They] include chop saws, cut-off saws, cordless saws, circular saws, worm drive saws, hypoid saws, jig saws, reciprocating saws, miter saws, planers, routers, jointers, angle cutters, shears, nibblers, and similar cutting tools. Professional electric sanding/grinding tools have moving abrasive surfaces used primarily for grinding, scraping, clearing, deburring, and polishing wood, metal, and other materials.... These tools are electromechanical tools and have self-contained electric motors. Some of these tools have electric cords; others are battery powered and are cordless. They are used by tradesmen, such as carpenters and electricians, for residential and non-residential construction and by industrial workers for a variety of industrial uses.
Professional electric power tools are typically designated, advertised, and sold as being suitable for "professional", "heavy-duty", or "industrial" use to distinguish such tools from "home" or "consumer" use electric power tools. [They] are distinguished by the producers and purchasers from consumer tools by their durability and ability to handle heavier work loads. Imported and domestically produced professional electric power tools typically, but not necessarily, are advertised as meeting the minimum safety standards promulgated by the Occupational Safety and Health Administration. Finally, professional electric power tools are sold at prices substantially higher than consumer electric power tools.
Petitioner believes that all of the exports to the United States by Makita Corporation ... Hitachi Ltd.... and Ryobi Ltd.... are professional electric power tools....1
The ITA's notice of initiation of an investigation of the petition's allegations called upon the interested parties "to more accurately describe"2 the tools at issue. Whereupon the petitioner suggested seven physical characteristics to distinguish consumer tools from those for professionals, to wit:
(1) The predominate use of sleeve or plain bearings.
(2) Spur or straight bevel gearing.
(3) Thermo plastic jacketed power supply cord with a length less than 8 feet.
(4) Power supply cord restrained by molded-on cord protector.
(5) The absence of user serviceable motor brushes.
(6) The predominate use of non-heat treated transmission parts.
(7) One coil per slot armature construction.
Plaintiffs' ITA Appendix 2, pp. 5-6. While the agency's preliminary determinations relied on these characteristics to the extent that tools possessed of at least five of the seven (or four of six) were considered to be for consumers and thus not subject to the investigation, the parties were invited therein to propose "criteria defining `corded' professional power tools ... and additional criteria that should be considered in distinguishing professional and consumer tools." 58 Fed. Reg. 81, 82 (Jan. 4, 1993).
The above-cited final determinations of the ITA were that
professional electric cutting tools (PECTs) and professional electric sanding/grinding tools ... from Japan are being, or are likely to be, sold in the United States at less than fair value, as provided in ... 19 U.S.C. 1673d[].
58 Fed.Reg. at 30,144. Weighted-average dumping margins were reported to be 54.43 and 46.75 percent for Makita tools within the two covered categories. See id. at 30,151.
Upon referral of these determinations to the ITC, the commissioners concluded that an industry in the United States is materially injured by reason of imports from Japan of professional electric cutting tools but not sanding/grinding tools. See 58 Fed.Reg. 37,967. This resulted in publication of the antidumping-duty order solely as to the cutting tools, with the amended estimated margin set at 54.52 percent. See 58 Fed.Reg. 37,461.
These actions ensued, with the plaintiffs Makita contesting the affirmative determinations of both agencies.
The motion which the plaintiffs direct at the ITA pursuant to CIT Rule 56.2 has four major points of contention, namely, (a) the definition of "professional" electric cutting tools is not based on substantial evidence; (b) the investigation of U.S. sales of used and reconditioned tools was neither supported by substantial evidence nor otherwise in accordance with law; (c) the "pooling" of home-market products is not authorized by law; and (d) the agency erred in its adjustments to foreign-market value and U.S. price.
The plaintiffs argue that the "difficulty ... in defining the so-called `professional' tools ... clearly shows that the definition which the Department ultimately came up with was arbitrary". Plaintiffs' Brief [ITA], p. 21. That definition is as follows:
"Corded" and "Cordless" PECTs are included within-the scope of this order. "Corded" PECTs, which are driven by electric current passed through a power cord, are, for purposes of this order, defined as power tools which have at least five of the following seven characteristics:
(1) The predominate use of ball, needle, or roller bearings (i.e., a majority or greater number of the bearings in the tool are ball, needle, or roller bearings);
(2) Helical, spiral bevel, or worm gearing;
(3) Rubber (or some equivalent material which meets UL's specifications S or SJ) jacketed power supply cord with a length of 8 feet or more;
(4) Power supply cord with a separate cord protector;
(5) Externally accessible motor brushes (6) The predominate use of heat treated transmission parts (i.e., a majority or greater number of the transmission parts in the tool are heat treated); and
(7) The presence of more than one coil per slot armature.
If only six of the above seven characteristics are applicable to a particular "corded" tool, then that tool must have at least four of the six characteristics to be considered a "corded" PECT.[3]
"Cordless" PECTs, for the purposes of this order, consist of those cordless electric power tools having a voltage greater than 7.2 volts and a battery recharge time of one hour or less.
58 Fed.Reg. at 37,462. See also 58 Fed.Reg. at 30,145. On its face, this reflects extrapolation of the petitioner's "consumer" criteria, supra. Cf. Plaintiffs' ITA Appendix 8.
Be that as it may, upon review of the record developed before the agency, this court cannot concur that this definition is "arbitrary", as alleged. On the contrary, there is substantial evidence, as defined by the courts4, on the record in support of differentiating professional from consumer electric cutting tools. It includes, for example, representations to the effect that the
professional power tool is designed to be more powerful, to last longer and to perform better under stressful conditions than its consumer counterpart. The difference is one of function and design. Both do the jobs they were designed to do extremely well. But, they are designed for totally different applications.
Brief of Defendant-Intervenor [ITA], Appendix 5, p. 1. This statement also indicates that professional models have longer cords, which are made of more durable materials that remain flexible in cold weather and are also removable, have more durable switches, utilize more powerful motors, and contain ball bearings rather than less-costly and lower-quality...
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