Rhp Bearings, Ltd. v. U.S.

• Decision Date: 16 December 1999
• Docket Number: Slip Op. 99-134.,No. 97-02-00217.,97-02-00217.
• Citation: 83 F.Supp.2d 1322
• Parties: RHP BEARINGS LTD., NSK Bearings Europe Ltd. and NSK Corporation, Plaintiffs, v. UNITED STATES, Defendant, The Torrington Company, Defendant-Intervenor.
• Court: U.S. Court of International Trade

83 F.Supp.2d 1322

RHP BEARINGS LTD., NSK Bearings Europe Ltd. and NSK Corporation, Plaintiffs, v. UNITED STATES, Defendant The Torrington Company, Defendant-Intervenor.

Slip Op. 99-134.

No. 97-02-00217.

United States Court of International Trade.

December 16, 1999.

COPYRIGHT MATERIAL OMITTED

Lipstein, Jaffe & Lawson, L.L.P. (Robert A. Lipstein, Matthew P. Jaffe and Grace W. Lawson), for plaintiffs.

David W. Ogden, Acting Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Velta A. Melnbrencis, Assistant Director); of counsel: Mark A. Barnett, Patrick V. Gallagher and David R. Mason, Office of the Chief Counsel for Import Administration, United States Department of Commerce, for defendant.

Stewart and Stewart (Terence P. Stewart, James R. Cannon, Jr., Wesley K. Caine, Geert De Prest and Lane S. Hurewitz), for defendant-intervenor.

OPINION

TSOUCALAS, Senior Judge.

Plaintiffs, RHP Bearings Ltd., NSK Bearings Europe Ltd. and NSK Corporation (collectively, "RHP-NSK"), move pursuant to USCIT R. 56.2 for judgment upon the agency record challenging various aspects of the Department of Commerce, International Trade Administration's ("Commerce") final determination, entitled Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, Singapore, and the United Kingdom; Final Results of Antidumping Duty Administrative Reviews ("Final Results"), 62 Fed.Reg. 2081 (Jan. 15, 1997), as amended, Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof from Germany: Amended Final Results of Antidumping Administrative Review, 62 Fed.Reg. 2130 (Jan. 15, 1997), and Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, and Singapore; Amended Final Results of Antidumping Duty Administrative Reviews, 62 Fed.Reg. 14,391 (Mar. 26, 1997).

Specifically, RHP-NSK claims that Commerce erred in: (1) using aggregate data that encompasses all foreign like products under consideration for normal value ("NV") for calculating constructed value ("CV") profit under 19 U.S.C. § 1677b(e)(2)(A) (1994); (2) including in RHP-NSK's United States sales database any sample transactions that were not supported by consideration; and (3) excluding imputed inventory carrying costs in the constructed export price ("CEP") offset for RHP-NSK when it matched CEP sales to CV.

Torrington responds that: (1) Commerce reasonably calculated profit for CV on the basis of the statutory preferred method of 19 U.S.C. § 1677b(e)(2)(A); (2) RHP-NSK failed to prove that the sample transactions in question were without consideration or, if a remand is ordered, Commerce should determine whether RHP-NSK's sample transactions are in fact without consideration; and (3) Commerce should not include imputed inventory carrying costs when comparing CEP sales to CV or, if a remand is ordered, any deduction of such costs should be capped not to exceed actual expenses.

The Court will address each of these arguments in turn.

BACKGROUND

This case concerns the sixth administrative review of the antidumping duty order on antifriction bearings (other than tapered roller bearings) and parts thereof ("AFBs") imported from the United Kingdom during the review period of May 1, 1994 through April 30, 1995.¹ Commerce published the preliminary results of the subject review on July 8, 1996. See Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof from France, Germany, Italy, Japan, Romania, Singapore, Thailand and the United Kingdom; Preliminary Results of Antidumping Duty Administrative Reviews, Termination of Administrative Reviews, and Partial Termination of Administrative Reviews ("Preliminary Results"), 61 Fed. Reg. 35,713. On January 15, 1997, Commerce published the Finals Results at issue here. See 62 Fed.Reg. at 2081.

JURISDICTION

The Court has jurisdiction over this matter pursuant to 19 U.S.C. § 1516a(a) (1994) and 28 U.S.C. § 1581(c) (1994).

STANDARD OF REVIEW

The Court will uphold Commerce's final determination in an administrative review 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)(i) (1994).

I. Substantial Evidence Test

Substantial evidence is "more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 95 L.Ed. 456 (1951) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938)). Substantial evidence "is something less than the weight of the evidence, and the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence." Consolo v. Federal Maritime Comm'n, 383 U.S. 607, 620, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966) (citations omitted). Moreover, "[t]he court may not substitute its judgment for that of the [agency] when the choice is `between two fairly conflicting views, even though the court would justifiably have made a different choice had the matter been before it de novo.'" American Spring Wire Corp. v. United States, 8 CIT 20, 22, 590 F.Supp. 1273, 1276 (1984) (quoting Penntech Papers, Inc. v. NLRB, 706 F.2d 18, 22-23 (1st Cir.1983) (quoting, in turn, Universal Camera, 340 U.S. at 488, 71 S.Ct. 456)).

II. Chevron Two-Step Analysis

To determine whether Commerce's interpretation and application of the antidumping statute is "in accordance with law," the Court must undertake the two-step analysis prescribed by Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). Under the first step, the Court reviews Commerce's construction of a statutory provision to determine whether "Congress has directly spoken to the precise question at issue." Id. at 842, 104 S.Ct. 2778. "To ascertain whether Congress had an intention on the precise question at issue, [the Court] employ[s] the `traditional tools of statutory construction.'" Timex V.I., Inc. v. United States, 157 F.3d 879, 882 (Fed.Cir.1998) (citing Chevron, 467 U.S. at 843 n. 9, 104 S.Ct. 2778). "The first and foremost `tool' is the statute's text, giving it its plain meaning. Because a statute's text is Congress's final expression of its intent, if the text answers the question, that is the end of the matter." Id. (citations omitted). Beyond the statute's text, the tools of statutory construction "include the statute's structure, canons of statutory construction, and legislative history." Id. (citations omitted); but see Floral Trade Council v. United States, 23 CIT ___, 41 F.Supp.2d 319, 323 n. 6 (1999) (noting that "[n]ot all rules of statutory construction rise to the level of a canon, however") (citation omitted).

If, after employing the first prong of Chevron, the Court determines that the statute is silent or ambiguous with respect to the specific issue, the question for the Court becomes whether Commerce's construction of the statute is permissible. Chevron, 467 U.S. at 843, 104 S.Ct. 2778. Essentially, this is an inquiry into the reasonableness of Commerce's interpretation. See Fujitsu Gen. Ltd. v. United States, 88 F.3d 1034, 1038 (Fed.Cir.1996). Provided Commerce has acted rationally, the Court may not substitute its judgment for the agency's. See IPSCO, Inc. v. United States, 965 F.2d 1056, 1061 (Fed.Cir.1992); see also Koyo Seiko Co. v. United States, 36 F.3d 1565, 1570 (Fed.Cir.1994) (holding that "a court must defer to an agency's reasonable interpretation of a statute even if the court might have preferred another"). The "[C]ourt will sustain the determination if it is reasonable and supported by the record as a whole, including whatever fairly detracts from the substantiality of the evidence." Negev Phosphates, Ltd. v. United States Dep't of Commerce, 12 CIT 1074, 1077, 699 F.Supp. 938, 942 (1988) (citations omitted). "In determining whether Commerce's interpretation is reasonable, the Court considers, among other factors, the express terms of the provisions at issue, the objectives of those provisions and the objectives of the antidumping scheme as a whole." Mitsubishi Heavy Indus., Inc. v. United States, 22 CIT ___, ___, 15 F.Supp.2d 807, 813 (1998)).

DISCUSSION

I. Calculation of Profit for Constructed Value

A. Statutory and Factual Background

An antidumping duty is imposed upon imported merchandise when (1) Commerce determines such merchandise is sold or likely to be sold in the United States at less than fair value ("LTFV," i.e., at a price which is lower than the price at which the merchandise is sold in the country of exportation or to a third country), and (2) the International Trade Commission determines that domestic industry is materially injured or threatened with material injury, or the establishment of an industry in the United States is materially retarded, by reason of imports of the subject merchandise or by reason of the LTFV sales or likelihood of LTFV sales of that merchandise for importation. See 19 U.S.C. § 1673 (1994). In calculating the antidumping duty, Commerce compares the price of the imported merchandise in the United States (i.e., export price ("EP") or CEP)² to its NV. See id. The dumping margin is "the amount by which the [NV] exceeds the [EP] or [CEP] of the subject merchandise." 19 U.S.C. § 1677(35) (1994).

NV is the comparable price for a product like the imported merchandise when first sold (generally, to unaffiliated parties) "for consumption in the exporting country, in the usual commercial quantities and in the ordinary course of trade and, to the extent practicable, at the same level of trade as the export price or constructed export price." 19 U.S.C. § 1677b(a)(1)(B)(i) (1994). Where home market sales...