NSK LTD. v. US
| Decision Date | 01 August 1995 |
| Docket Number | Slip Op. 95-138. Court No. 92-07-00470. |
| Citation | 896 F. Supp. 1263,19 CIT 1013 |
| Parties | NSK LTD. and NSK Corporation, Plaintiffs, v. UNITED STATES, Defendant, Federal-Mogul Corporation; the Torrington Company, Defendant-Intervenors. |
| Court | U.S. Court of International Trade |
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Lipstein, Jaffe & Lawson, L.L.P., Washington, DC (Robert A. Lipstein, Matthew P. Jaffe and Grace W. Lawson), for plaintiffs NSK Ltd. and NSK Corporation.
Frank W. Hunger, Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Marc E. Montalbine); of counsel: Stephen J. Claeys, Thomas H. Fine, Alicia Greenidge and Dean A. Pinkert, Attorney-Advisors, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, Washington, DC, for defendant.
Frederick L. Ikenson, P.C., Washington, DC (Frederick L. Ikenson, J. Eric Nissley and Joseph A. Perna, V), for defendant-intervenor Federal-Mogul Corporation.
Stewart and Stewart, Washington, DC (Eugene L. Stewart, Terence P. Stewart, James R. Cannon, Jr., John M. Breen, Lane S. Hurewitz, Myron A. Brilliant, Larry Hampel and Patrick J. McDonough), for defendant-intervenor The Torrington Company.
Plaintiff NSK Ltd., a Japanese corporation, is a manufacturer, producer and exporter of antifriction bearings ("AFBs"). Plaintiff NSK Corporation, a U.S. corporation and a wholly-owned subsidiary of NSK Ltd., is an importer and manufacturer of AFBs. NSK Ltd. (formerly Nippon Seiko K.K.) and NSK Corporation (collectively "NSK") move for judgment upon the agency record pursuant to Rule 56.2 of the Rules of this Court. NSK contests the final determination of administrative review issued by the United States Department of Commerce, International Trade Administration ("Commerce"), concerning AFBs and parts thereof from Japan. See Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France; et al.; Final Results of Antidumping Duty Administrative Reviews ("Final Results"), 57 Fed.Reg. 28,360 (1992), as amended, Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, Sweden, and the United Kingdom, Amendment to Final Results of Antidumping Duty Administrative Reviews ("Amended Final Results"), 57 Fed.Reg. 59,080 (1992). Specifically, NSK objects to the following actions by Commerce with respect to Japan: (1) requiring reporting of, and including in its analysis, sales of parts "further manufactured" after importation into the United States; (2) inclusion of sample sales in the United States sales database for purposes of margin calculation; (3) treatment of home market early payment discounts as indirect selling expenses; (4) classification of plaintiffs' home market credit expenses as indirect selling expenses; (5) subtraction of early payment discounts and distributor incentive rebates from the home market unit price for purposes of conducting the cost of production test; (6) deduction of direct selling expenses from exporter's sales price rather than adding such expenses to the foreign market value; and (7) with respect to the Amended Final Results, failure to instruct the United States Customs Service ("Customs") to refund plaintiffs' excess cash deposits, plus interest. NSK contends that these errors by Commerce render the Final Results unsupported by substantial evidence and contrary to law.
Defendant-intervenors Federal-Mogul Corporation ("Federal-Mogul"), a manufacturer in the United States of antifriction bearings, and The Torrington Company ("Torrington"), the petitioner in the original investigation, oppose NSK's challenge.
On May 15, 1989, Commerce published antidumping duty orders on ball bearings, cylindrical roller bearings, spherical plain bearings, and parts thereof from Japan, Germany, France, Italy, Romania, Singapore, Sweden, Thailand and the United Kingdom. See Antidumping Duty Orders: Ball Bearings, Cylindrical Roller Bearings, and Spherical Plain Bearings, and Parts Thereof From Japan, 54 Fed.Reg. 20,904 (1989).1
On June 28, July 19 and August 14, 1991, Commerce initiated administrative reviews of those orders with respect to sixty-three manufacturers and exporters, including Nippon Seiko K.K. and NSK Corporation, for the period May 1, 1990 through April 30, 1991. Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From the Federal Republic of Germany, France, Italy, Japan, Romania, Singapore, Sweden, Thailand, and the United Kingdom; Initiation of Antidumping Administrative Reviews, 56 Fed.Reg. 29,618 (1991); Initiation of Antidumping and Countervailing Duty Administrative Reviews, 56 Fed.Reg. 33,251 (1991); Initiation of Antidumping and Countervailing Duty Administrative Reviews, 56 Fed.Reg. 40,305 (1991).
On March 31, 1992, Commerce issued its Japan preliminary determinations in the second administrative reviews. Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From Japan; Preliminary Results of Antidumping Duty Administrative Reviews and Partial Termination of Administrative Reviews ("Preliminary Determination"), 57 Fed.Reg. 10,868 (1992).2
On June 24, 1992, Commerce published one joint final determination for nine administrative reviews. Final Results, 57 Fed. Reg. at 28,360.
On July 16, 1992, NSK commenced this action, challenging the Final Results with respect to Japan.
On September 24, 1992, and October 23, 1992, respectively, the Court granted Federal-Mogul's and Torrington's motions to intervene as defendants in this civil action.
On December 14, 1992, having received leave from the Court, Commerce published amended final results, correcting certain clerical errors contained in its Final Results. See Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, Sweden, and the United Kingdom; Amendment to Final Results of Antidumping Duty Administrative Reviews, 57 Fed.Reg. 59,080 (1992). NSK was granted leave to amend its complaint to take into account any changes in the Final Results as a result of Commerce's corrections.
On January 11, 1993, NSK filed an amended complaint contending that Commerce's Amended Final Results failed to instruct Customs to refund, with interest, the excess in cash deposits collected from NSK as a result of clerical errors in the Final Results. NSK's Amended Complaint at 9-10.
The Court's jurisdiction in this action is derived from 19 U.S.C. § 1516a(a)(2) (1988) and 28 U.S.C. § 1581(c) (1988).
The Court must uphold Commerce's final determination unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B) (1988). Substantial evidence is Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 459, 95 L.Ed. 456 (1951) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938)). "It is not within the Court's domain either to weigh the adequate quality or quantity of the evidence for sufficiency or to reject a finding on grounds of a differing interpretation of the record." Timken Co. v. United States, 12 CIT 955, 962, 699 F.Supp. 300, 306 (1988), aff'd, 894 F.2d 385 (Fed.Cir.1990).
In calculating U.S. price, Commerce included NSK's sample sales in the U.S. sales database. NSK contends that its zero price samples should be excluded from Commerce's margin calculations. According to NSK, it provides small quantities of sample bearings at no charge to prospective buyers in the United States to induce purchases. Memorandum of Points and Authorities in Support of Motion for Judgment on the Agency Record ("NSK's Brief") at 11. NSK contends that, after the potential purchaser completes a test performance, the customer typically disassembles the sample bearings for analysis or returns the bearings to NSK for evaluation by NSK's engineers. NSK's Brief at 11.
In the Final Results, Commerce rejected NSK's contention, stating:
Nothing on record here demonstrates that NSK maintains exclusive ownership of the subject merchandise after exportation to the U.S..... Furthermore, at verification of NSK's ESP sales, it was determined that the line item for samples covered only the incidental expenses in delivering and packaging the sample, not the actual cost of the sample itself. Department of Commerce Verification Report for NSK, March 17, 1992, at 8. Finally, the statute and the regulations require the Department to analyze all sales within the period of review.
Final Results, 57 Fed.Reg. at 28,395.
NSK argues that Commerce has previously articulated at least three standards for evaluating zero price samples. NSK contends, however, that in this review Commerce failed to identify the standard which it applied to NSK's zero price samples and failed to state its rationale for including those samples in its U.S. database. NSK's Brief at 22-23. NSK concedes that its indirect selling expenses reflect only incidental expenses in delivering and packaging the samples, and not the actual cost of the samples. However, NSK requests that the Court remand to Commerce to explain why NSK's zero price U.S. samples are "sales" within the context of 19 U.S.C. § 1673 (1988)3, or that it find that the samples are not sales. Id. at 22-25.
Commerce agrees that the Court should remand this case so that it may further explain its treatment of NSK's zero price sales. Defendant's Memorandum in Opposition to Plaintiffs' Motion for Judgment on the Agency Record ("Defendant's Brief") at 17.
Federal-Mogul supports Commerce's inclusion of NSK's zero-priced U.S. sales in its margin analysis as lawful and reasonable. Response of Federal-Mogul Corporation,...
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