Hyundai Electronics Industries v. U.S.

• Decision Date: 18 January 2006
• Docket Number: Slip Op. 06-9. Court No. 00-01-00027.
• Citation: 414 F.Supp.2d 1289
• Parties: HYUNDAI ELECTRONICS INDUSTRIES CO., LTD. and Hyundai Electronics America, Inc., Plaintiffs, v. UNITED STATES, Defendant, and Micron Technology, Inc., Defendant-Intervenor.
• Court: U.S. Court of International Trade

Page 1289

414 F.Supp.2d 1289

HYUNDAI ELECTRONICS INDUSTRIES CO., LTD. and Hyundai Electronics America, Inc., Plaintiffs, v. UNITED STATES, Defendant, and Micron Technology, Inc., Defendant-Intervenor.

Slip Op. 06-9. Court No. 00-01-00027.

United States Court of International Trade.

January 18, 2006.

Willkie, Farr & Gallagher LLP, Washington, DC (Daniel L. Porter and James P. Durling) for Plaintiffs Hyundai Electronics Industries Co., Ltd. and Hyundai Electronics America, Inc.

Peter D. Keisler, Assistant Attorney General, David M. Cohen, Director, Jeanne E. Davidson, Deputy Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Kenneth S. Kessler); Patrick V. Gallagher, Jr., Office of the Chief Counsel for Import Administration, United States Department

of Commerce, for Defendant United States, of counsel.

King & Spalding LLP, Washington, DC (Gilbert B. Kaplan, Cris R. Revaz, and Daniel L. Schneiderman) for Defendant-Intervenor Micron Technology, Inc.

OPINION

GOLDBERG, Senior Judge.

This case is before the Court following second remand to the United States Department of Commerce ("Commerce") of the results of a fifth administrative review of an antidumping duty order and upon motion for reconsideration of the Court's previous remand decisions. The Court has jurisdiction pursuant to 28 U.S.C. § 1581(c).

I. BACKGROUND

In Hyundai Electronics Industries Co. v. United States, 29 CIT ___, 395

F.Supp.2d 1231 (CIT 2005) ("Hyundai II"), familiarity with which is presumed, the Court sustained in part and remanded in part Commerce's first redetermination in the fifth administrative review regarding Dynamic Random Access Memory Semiconductors of one megabit or above from the Republic of Korea ("Korea") produced by Hyundai Electronics Industries Co., Ltd. and Hyundai Electronics America, Inc. (collectively "Hyundai") and LG Semicon Co., Ltd. ("LG Semicon").¹ See Final Results of Redetermination Pursuant to Court Remand (Aug. 31, 2004), available at http://ia.ita.doc.gov/remands/04-37.pdf (the "First Remand Results"); Dynamic Random Access Memory Semiconductors of One Megabit or Above From the Republic of Korea, 64 Fed.Reg. 69694 (Dec. 14, 1999) (final results of administrative review) (the "Final Results").

In Hyundai II, the Court reviewed several aspects of the First Remand Results, including, in relevant part:² (1) Commerce's decision to use Plaintiffs' amortized research and development ("R & D") expenses in the calculation of the cost of producing the subject merchandise; and (2) Commerce's provision of additional evidence to support its rejection of Plaintiffs' deferral of R & D costs related to longterm projects. See Hyundai II, 29 CIT at ___, 395 F.Supp.2d at 1239-42. The Court sustained Commerce's redetermination with respect to issue (1), id. at ___, 395 F.Supp.2d at 1240-41; but, citing evidentiary deficiencies, rejected Commerce's position as to issue (2). Id. at ___, 395 F.Supp.2d at 1242. The Court remanded this issue to Commerce with instructions to accept Plaintiffs' deferral methodology in calculating R & D expenses for longterm projects. Id. Commerce duly complied with the Court's order. After receiving no comments from Plaintiffs or Defendant-Intervenor Micron Technology, Inc. ("Micron") on its draft calculations, Commerce released the Final Results of Redetermination Pursuant to Court Remand (Sept. 23, 2005) (the "Second Remand Results"). Although expressing disagreement with the findings in Hyundai II, Commerce recalculated Plaintiffs' R & D expenses pursuant to the Court's instructions. Second Remand Results at 1.

Eighteen days later, Micron submitted a Memorandum Addressing the Final Results of Redetermination Pursuant to Court Remand ("Def.-Intvr.'s Br."). While acknowledging the Second Remand Results' conformity with Hyundai II, Micron argued that an intervening opinion by the United States Court of Appeals for the Federal Circuit (the "Federal Circuit") had indirectly overruled the conclusions of law underpinning Hyundai II. Def.-Intvr.'s Br. at 1 (citing Hynix Semiconductor Inc. v. United States, 424 F.3d 1363 (Fed.Cir. 2005) ("Hynix IV")³). Plaintiffs submitted Rebuttal Comments in Response to Defendant-Intervenor's Memorandum ("Pls.' Br."), arguing that the Federal Circuit's decision in Hynix IV was based on conclusions of fact particular to the investigation at issue in that case rather than general conclusions of law. Pls.' Br. at 2. Commerce filed a response brief ("Commerce's Br.") agreeing with Micron's arguments. Commerce's Br. at 2. Commerce additionally filed a motion for reconsideration and partial modification of the Court's previous remand decisions ("Commerce's Motion"), requesting that the Court direct Commerce to reinstate certain of its original findings and recalculate the antidumping duty margins accordingly. Commerce's Motion at 2.

This case is now properly before the Court following second remand and upon Commerce's Motion, consolidated for purposes of this opinion. The Court must uphold Commerce's determination if it is supported by substantial evidence and otherwise in accordance with law. 19 U.S.C. 1516a(b)(1)(B)(i) (2000). The Court may exercise its discretion to revise its previous remand decisions, see USCIT R. 59(a),⁴ although the Court will generally only do so on motion for reconsideration where the Court's previous decisions are "manifestly erroneous." Former Employees of Quality Fabricating, Inc. v. United States, 28 CIT ___, ___, 353 F.Supp.2d 1284, 1288 (2004) (quotation marks omitted); cf. Doe v. New York City Dep't of Social Services, 709 F.2d 782, 789 (2d Cir.1983) ("The major grounds justifying reconsideration are an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.") (quotation marks omitted). After due consideration of the parties' submissions, the Federal Circuit's decision in Hynix IV, the administrative record, and all other papers had herein, and for the reasons that follow, the Court grants in part Commerce's Motion, modifies its previous decisions, and remands this case with instructions.

II. DISCUSSION

A. The Court Must Apply Relevant Federal Circuit Decisions Issued During the Course of Remand Proceedings

At the outset, it is necessary to recite that this Court is bound by the decisions of its appellate courts. Before entering final judgment, the U.S. Court of International Trade must consider the legal effect of Federal Circuit or U.S. Supreme Court decisions issued during the course of the often lengthy remand proceedings which characterize this Court's antidumping and countervailing duty cases. When, for example, an intervening decision by the Federal Circuit clarifies a legal principle of relevance to a case at bar, the Court must apply it. See, e.g., E.I. DuPont de Nemours & Co. v. United States, 17 CIT 1266, 1288, 841 F.Supp. 1237, 1254 (1993) (remanding case to allow Commerce to reexamine its methodology in light of intervening Federal Circuit decision); Federal-Mogul Corp. v. United States, 18 CIT 160, 163, 1994 WL 88926 (1994) (remanding case to allow Commerce to consider issues raised by intervening Federal Circuit decision). A regrettable byproduct of this due deference may be to prolong already lengthy litigation with another agency remand; nonetheless, the Court may not shirk its ongoing responsibility to review the legality of agency determinations.

It is, however, equally true that there are certain natural limits to the reach of Federal Circuit decisions. As with any judicial precedent, they are only as relevant to subsequent cases as their unique fact patterns will allow. A Federal Circuit decision which turns on case-specific findings of fact may be of less precedential importance to a case at bar than a decision based on generally applicable conclusions of law. The Court is charged with discerning the controlling legal principles from Federal Circuit decisions. See Aves. In Leather, Inc. v. United States, 423 F.3d 1326, 1331 (Fed.Cir.2005) (noting "doctrine of stare decisis applies to only legal issues and not issues of fact").

In this light, it is clear that Micron has rightly drawn the Court's attention to Hynix IV, a recent Federal Circuit decision potentially relevant to the disposition of certain issues in this case. By the same measure, Plaintiffs have appropriately cautioned the Court to consider the possibly limited application of a case involving a different factual record. With the inquiry so framed, the Court turns to its analysis of Hynix IV.

B. Hynix IV Clarified Legal Principles at Issue in this Case

1. Overview of Hynix IV

The factual and procedural background of Hynix IV is familiar to the parties and the Court. Hynix IV involved an appeal of judgments by the U.S. Court of International Trade (Carman, J.)⁵ which reviewed several aspects of the seventh administrative review of the same antidumping duty order at issue in the case at bar. Although the cases cover two different periods of review and two different administrative records, the parties in these two cases are identical⁶ and they raised many of the same issues in both proceedings.

Of particular relevance is the issue of the appropriate treatment by Commerce of certain R & D cost accounting practices used by Hynix during the period of review covered by Hynix IV. During the seventh administrative review, Hynix accounted for R & D costs by amortizing them, which represented a change from the cost accounting practice of expensing used in previous periods of review. Hynix I, 27 CIT at ___, 248 F.Supp.2d at 1305. At the same time, Hynix also chose to defer recognition of the R & D costs associated with certain long-term projects until these projects were commercialized (i.e., revenue-producing). Id. Although acknowledging that these two cost accounting practices were recognized under Korea's generally accepted...