Mitsubishi Heavy Indus., Ltd. v. US

• Decision Date: 15 September 1993
• Docket Number: Court Number 92-02-00118.
• Citation: 833 F. Supp. 919,17 CIT 1024
• Parties: MITSUBISHI HEAVY INDUS., LTD., Plaintiff, v. UNITED STATES, Defendant, Hyster Co. et al., Defendant-Intervenors.
• Court: U.S. Court of International Trade

833 F. Supp. 919

17 CIT 1024

MITSUBISHI HEAVY INDUS., LTD., Plaintiff, v. UNITED STATES, Defendant Hyster Co. et al., Defendant-Intervenors.

Court Number 92-02-00118.

United States Court of International Trade.

September 15, 1993.

Baker & Hostetler, Kenneth G. Weigel, Thomas Hylden, John C. Lindsey and Patricia M. Steele, Washington, DC, for plaintiff.

Frank W. Hunger, Asst. Atty. Gen., David M. Cohen, Director, Civ. Div., Commercial Litigation Branch, U.S. Dept. of Justice and A. David Lafer, Marc E. Montalbine, Pria Alagari, Atty.-Advisor, Office of the Chief Counsel for Import Admin., U.S. Dept. of Commerce, Washington, DC, of counsel, for defendant.

Collier, Shannon, Rill & Scott, Paul C. Rosenthal, Mary T. Staley and Joanna K. McIntosh, Washington, DC, for defendant-intervenors.

OPINION

CARMAN, Judge:

Plaintiff, Mitsubishi Heavy Industries (MHI), moves for judgment upon the agency record pursuant to Rule 56.1 of this Court. Plaintiff contests certain aspects of the Department of Commerce's (Commerce) final results in Certain Internal-Combustion, Industrial Forklift Trucks from Japan; Final Results of Antidumping Duty Administrative Review, 57 Fed.Reg. 3,167 (1992) (Final Determination). Plaintiff seeks to have the Court remand the matter to Commerce. The Court has jurisdiction over this action pursuant to 28 U.S.C. § 1581(c) (1988).

BACKGROUND

Commerce published an antidumping duty order covering certain internal-combustion forklift trucks from Japan on June 7, 1988, and a notice of an initiation of administrative review of the antidumping duty order on July 25, 1989. See Antidumping Duty Order and Amendment to Final Determination of Sales at Less Than Fair Value; Certain Industrial Internal-Combustion Forklift Trucks from Japan, 53 Fed.Reg. 20,882 (1988); Initiation of Antidumping and Countervailing Duty Administrative Reviews, 54 Fed.Reg. 30,915 (1989) (Initiation). The review covered the period of November 24, 1987 through May 31, 1989. Initiation, 54 Fed. Reg. 30,915.

Commerce sent MHI a questionnaire on August 4, 1989, requesting information on MHI's corporate structure and sales data of forklift trucks in the home market and United States. R.Doc. 24. MHI stated it sold forklift trucks directly to Mitsubishi Motors Corporation (MMC) and MHI dealers, and made its sales to the U.S. through trading companies. Conf.Doc. 14 at 245. According to MHI, "both types of dealers operate under the same dealership agreement, except the agreement with MHI dealers has an additional article providing advice and counsel by MHI. Also, as explained below, MHI dealers receive special rebates and terms of payment." Id. MHI argued in its response Commerce "should only consider sales to MMC dealers because all MMC dealers are treated equally and are treated differently than MHI dealers." Id. at 248. MHI, therefore, submitted data pertaining to its sales to MMC dealers, but no information regarding MHI dealer sales to unrelated customers. MHI also failed to report approximately 30% of U.S. sales, arguing these sales had been liquidated by the U.S. Customs Service. Conf.Doc. 14; Conf.Doc. 95.

In response to petitioners' below cost allegations, on March 20, 1990, Commerce requested MHI provide information on sales by MHI dealers to unrelated buyers or show that sales from MHI to MHI dealers were arm's-length transactions. R.Doc. 176. Commerce also asked MHI to correct prior deficiencies including submitting MHI dealer sales to unrelated customers in Japan in order to demonstrate whether MHI sales to MHI dealers were arm's-length transactions. Id. MHI subsequently submitted a response, but refused to submit data on sales between MHI dealers and end users. R.Doc. 187 at 1595. MHI claimed the requested information was not relevant to the proceeding "regardless of whether MHI's sales to MHI dealers are or are not considered arms-length transactions." Id. Plaintiff further stated it would "be extremely burdensome if not impossible for MHI to obtain information from its related dealers on their sales." Id. at 1597.

After Commerce requested information relevant to its change in the model match selection process and made additional requests for MHI dealers sales to end users, MHI submitted its supplemental responses. See R.Doc. 208; R.Doc. 214; R.Doc. 222. It failed, however, to report sales for allegedly liquidated entries and again refused to submit MHI dealer sales to end users. R.Doc. 222 at 2,111.

MHI continued to refuse to supply the required data despite requests from Commerce in several letters and conferences. See R.Doc. 248; R.Doc. 250; R.Doc. 256; R.Doc. 272. Commerce advised MHI that failure to report all MHI dealer sales to end users could result in the use of BIA. R.Doc. 272. MHI finally agreed to provide the data if it were granted a 45-day extension of time which, according to MHI, would be necessary to "undertake the enormous task of compiling this information." R.Doc. 278 at 337-38. MHI, however, stated that Commerce must determine whether sales between MHI dealers and end users would be used in computing foreign market value before MHI would submit such information. Id.

On October 16, 1990, the day after the due date for MHI's supplemental questionnaire, Commerce personnel met with MHI representatives to discuss MHI's request for an extension of time. R.Doc. 287. During this meeting, Commerce stated it needed the MHI dealer to end users sales information and MHI responded that Commerce should not examine such sales. Id. At the conclusion of the meeting, Commerce denied MHI's request for an extension of time. R.Doc. 284. In its denial letter, Commerce pointed out that MHI had over one year to obtain the MHI dealer's end-user sales and more than six months to gather the cost of production data for the MHI sales to related MHI dealers. Id.

Shortly after Commerce denied MHI's request for an extension of time, MHI wrote Commerce to protest the denial and to reiterate its contention that MHI dealer sales to end users were irrelevant to the investigation. R.Doc. 285. In addition, in contrast to previous statements, MHI claimed it could not supply MHI dealers sales to end users data because

it is not possible to obtain from these dealers the information necessary to respond fully to a questionnaire from the Department.... As a practical matter MHI is unable to provide these data in a form sufficient for purposes of calculation of foreign market value. As we all have agreed, it would have been preferable to provide these data and then discuss their applicability, but this could not be done.

Id. at 385.

On November 1, 1990, petitioners sent Commerce a letter arguing BIA should be used in calculating MHI's dumping margin. R.Doc.298. In response to petitioners' letter, MHI submitted a letter with attachments to Commerce. Commerce, however, rejected the submission, citing 19 C.F.R. § 353.31(b)(2) (1990)'s prohibition against unsolicited questionnaire responses. R.Doc. 320. MHI sent additional letters in which it argued Commerce could not properly use or request information pertaining to MHI dealer sales to end users under its regulations. R.Doc. 324 at 1,135-38; R.Doc. 325 at 1,154. Additionally, MHI maintained even if BIA were proper, Commerce should use constructed value as BIA for MHI dealer sales to end users in order to calculate foreign market value. R.Doc. 325 at 1,154.

Commerce published the preliminary results of its review on May 23, 1991. Certain Internal-Combustion, Industrial Forklift Trucks From Japan; Preliminary Results of Antidumping Duty Administrative Review, 56 Fed.Reg. 23,675 (1991). MHI requested Commerce conduct a public hearing, and on July 12, 1991, after MHI and petitioners submitted hearing briefs, Commerce held a hearing on its preliminary determination. R.Doc. 446. On August 7, 1991, Commerce rejected material contained in MHI's hearing briefs due to the presence of new and unsolicited factual information. R.Doc. 458.

Commerce published the final results of its administrative review on January 28, 1992. The final results affirmed Commerce's preliminary determination to use best information available (BIA) and calculated MHI's dumping margin to be 39.15%. Final Determination, 57 Fed.Reg. at 3,184.

CONTENTIONS OF THE PARTIES

MHI contends MHI's decision to use BIA to calculate foreign market value and U.S. price for MHI's sales was not in accordance with law. MHI argues Commerce was unjustified in its demand for information regarding sales between MHI dealers and end users in the home market and data on those U.S. sales which Customs had liquidated. Plaintiff claims there was substantial evidence on the record demonstrating that all sales by MHI to MHI dealers in the home market were arm's-length sales.

Plaintiff maintains the statutory and regulatory framework permit, but do not require, Commerce to use sales to related parties. According to MHI, Commerce's calculation of foreign market value should have been based on sales by MHI to MMC and MHI dealers. Additionally, MHI argues Commerce should not have resorted to BIA even if the MHI sales to MHI dealers were not arm's-length, because (1) Commerce would not have used the requested information in its calculations and (2) the information did not exist.

MHI maintains Commerce's choice of BIA was not in accordance with law. If the Court holds Commerce properly used BIA, MHI argues that Commerce should not have used the "all others" rate. Instead, according to MHI, Commerce should have used the evidence on the record and the results of the review wherever possible.¹

Defendant maintains its final determination is based on substantial evidence on the record and is otherwise in accordance with law. According to Commerce, it properly requested data on sales by MHI dealers to end users because the information was necessary to calculate foreign market value. Similarly, Commerce argues it properly required MHI to provide data on...