Timken Co. v. US

• Decision Date: 27 May 1994
• Docket Number: Slip Op. 94-87. Court No. 91-09-00697.
• Citation: 852 F. Supp. 1122,18 CIT 486
• Parties: The TIMKEN COMPANY, Plaintiff, v. UNITED STATES, Defendant, and NTN Bearing Corporation of America, American NTN Bearing Manufacturing Corporation and NTN Corporation; Koyo Seiko Company, Ltd. and Koyo Corporation of U.S.A.; Caterpillar Inc., Defendant-Intervenors.
• Court: U.S. Court of International Trade

852 F. Supp. 1122

18 CIT 486

The TIMKEN COMPANY, Plaintiff, v. UNITED STATES, Defendant, and NTN Bearing Corporation of America, American NTN Bearing Manufacturing Corporation and NTN Corporation; Koyo Seiko Company, Ltd. and Koyo Corporation of U.S.A.; Caterpillar Inc., Defendant-Intervenors.

Slip Op. 94-87. Court No. 91-09-00697.

United States Court of International Trade.

May 27, 1994.

Stewart and Stewart, Washington, DC, Eugene L. Stewart, Terence P. Stewart, James R. Cannon, Jr., William A. Fennell, Patrick J. McDonough, Julie Chasen Ross and Christopher J. Callahan, of counsel: Scott A. Scherff, Sr. Corporate Counsel, The Timken Co., for plaintiff The Timken Com.

Frank W. Hunger, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civ. Div., U.S. Dept. of Justice, Velta A. Melnbrencis, of counsel: Linda S. Chang, Attorney-Advisor, Office of the Chief Counsel for Import Admin., U.S. Dept. of Commerce, for defendant.

Barnes, Richardson & Colburn, Chicago, IL, Robert E. Burke, Donald J. Unger and Jesse M. Gerson, for defendant-intervenors NTN Bearing Corp. of America, American NTN Bearing Mfg. Corp. and NTN Corp.

Powell, Goldstein, Frazer & Murphy, Washington, DC, Peter O. Suchman, Susan P. Strommer, Susan M. Mathews, D. Christine Wood and Robert A. Calaff, for defendant-intervenors Koyo Seiko Co., Ltd. and Koyo Corp. of U.S.A.

Powell, Goldstein, Frazer & Murphy, Washington, DC, Richard M. Belanger, D. Christine Wood and Neil R. Ellis, for defendant-intervenor Caterpillar Inc.

OPINION

TSOUCALAS, Judge:

Plaintiff, The Timken Company ("Timken"), commenced this action to challenge certain aspects of the Department of Commerce, International Trade Administration's ("Commerce") final results of the first administrative review of certain tapered roller bearings ("TRBs") from Japan. Tapered Roller Bearings, Finished and Unfinished, and Parts Thereof, From Japan; Final Results of Antidumping Duty Administrative Review ("Final Results"), 56 Fed.Reg. 41,508 (Aug. 21, 1991).

Background

In 1987, Commerce published an antidumping duty order on TRBs from Japan. Antidumping Duty Order, Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, From Japan, 52 Fed.Reg. 37,352 (Oct. 6, 1987). In 1989, Commerce initiated the first administrative review of the TRBs covered by the 1987 order covering the period March 27, 1987 through September 30, 1988. Initiation of Antidumping and Countervailing Duty Administrative Reviews, 54 Fed.Reg. 9,868 (March 8, 1989). On April 3, 1991, Commerce published the preliminary results of its 1987-88 administrative review of the 1987 antidumping duty order. Tapered Roller Bearings and Parts Thereof, Finished and Unfinished From Japan; Preliminary Results of Antidumping Duty Administrative Review, 56 Fed.Reg. 13,618 (April 3, 1991). On August 21, 1991, Commerce published its Final Results in this proceeding. Final Results, 56 Fed.Reg. 41,508.

Timken has challenged the following actions by Commerce alleging that these actions were unsupported by substantial evidence on the administrative record and not in accordance with law: (1) failure to use best information available ("BIA") for cost of production information allegedly not provided; (2) treatment of discounts and rebates to United States exporter's sales price ("ESP") sales as indirect selling expenses; (3) exclusion of certain home market sales as not in the ordinary course of trade; (4) acceptance of cost of production data; (5) failure to conduct verification; (6) adjustment of foreign market value for home market pre-sale freight expenses; (7) failure to collect antidumping duty deposits on merchandise admitted into a foreign trade zone ("FTZ"); (8) allocation of losses to the "value added" for further processing of merchandise after importation; and (9) several computer programming errors. Memorandum in Support of Plaintiff's Motion for Judgment on the Agency Record ("Plaintiff's Brief") at 16-87.

Discussion

This Court has jurisdiction over this matter pursuant to 19 U.S.C. § 1516a(a)(2) (1988) and 28 U.S.C. § 1581(c) (1988).

This Court must uphold final results of an administrative review by Commerce unless the determination 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 defined as "relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938); Alhambra Foundry Co. v. United States, 12 CIT 343, 345, 685 F.Supp. 1252, 1255 (1988). 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).

1. Best Information Available

Timken asserts that as defendant-intervenors NTN Bearing Corporation of America, American NTN Bearing Manufacturing Corporation and NTN Corporation ("NTN") have failed to provide Commerce with all requested cost of production information, Commerce is required to make its determination using the best information otherwise available pursuant to 19 U.S.C. § 1677e(c) (1991). Plaintiff's brief at 16-20.

Relying on Timken Co. v. United States, 10 CIT 86, 630 F.Supp. 1327 (1986), Timken argues that Commerce has abdicated its role by allowing NTN to select the information used to calculate NTN's dumping margin. Plaintiff's Brief at 19. More specifically, Timken argues that Commerce has abdicated its duty under 19 U.S.C. § 1677b(a)(1)(A) (1991) and 19 U.S.C. § 1677(16) to select sales of home market merchandise most similar to models sold in the U.S. Plaintiff's Reply Brief at 2-4. Plaintiff urges this Court to remand to Commerce for a recalculation of NTN's dumping margin based on BIA or, in the alternative, to remand with instructions that Commerce collect the missing data. Id. at 9.

Defendant argues that because the omitted data is a comparatively small amount of the home market merchandise considered and there is no indication that those sales were the most comparable merchandise to the merchandise exported to the U.S., no remand to Commerce for recalculation of NTN's dumping margin is warranted. Defendant's Memorandum in Opposition to Plaintiff's Motion for Judgment Upon the Agency Record ("Defendant's Brief") at 7.

NTN asserts that Commerce was satisfied with the information provided by NTN and that Commerce communicated that NTN need not file any response to its September 26, 1990 supplemental request for additional information as to cost of production. Response Brief of Defendant-Intervenors NTN Bearing Corporation of America, American NTN Bearing Manufacturing Corporation, and NTN Corporation to Plaintiff's Motion for Judgment on the Agency Record ("NTN's Brief") at 9-17. NTN has memorialized this alleged understanding in its rebuttal brief before Commerce of May 21, 1991. Id. at 15.

Plaintiff responds to the defendant's argument that the omitted data is a comparatively small amount of the home market merchandise considered by arguing that the ratio of missing data to home market sales is irrelevant. Plaintiff's Reply Brief at 4. Plaintiff argues that it is U.S. sales data and the similarity of the home market merchandise to the U.S. sales which determines the dumping margin. Id. at 4-5. Thus, plaintiff argues, cost data omitted for a single identical home market sale could have tremendous impact if it was a large-volume item in the U.S. Id.

Plaintiff's reliance on Timken is misplaced. The errors committed by Commerce in Timken were numerous and egregious in degree. Timken, 10 CIT at 95-100, 630 F.Supp. at 1336-40. In contrast, Commerce here has apparently deemed constructed value information submitted by NTN adequate for purposes of any missing cost of production information. Final Results, 56 Fed.Reg. at 41,511.

However, plaintiff is quite correct that Commerce is required to use BIA under certain circumstances. Atlantic Sugar, Ltd. v. United States, 744 F.2d 1556, 1560 (Fed. Cir.1984), cited in, U.H.F.C. Co. v. United States, 13 CIT 119, 129, 706 F.Supp. 914, 922 (1989), aff'd in part, rev'd in part, 916 F.2d 689 (Fed.Cir.1990), vacated and remanded, 14 CIT 753 (1990); see also, Allied-Signal Aerospace Co. v. United States, 996 F.2d 1185, 1190 (Fed.Cir.1993). Section 1677e(c) of Title 19, U.S.C., states that Commerce "shall, whenever a party ... refuses or is unable to produce information requested in a timely manner ... use the best information otherwise available."

It is well-established, however, that Commerce has broad discretion with regard to when the use of BIA is appropriate. See, e.g., Olympic Adhesives, Inc. v. United States, 899 F.2d 1565, 1571-72 (Fed.Cir. 1990).

Despite extensive review of the administrative record by this Court, it is simply not clear whether Commerce received all the data it requested of NTN in its letter dated September 26, 1990 and, if it did not, whether Commerce deemed the missing data unnecessary. Therefore, this Court remands for Commerce to account for the allegedly missing data. If indeed NTN did not completely respond to the request for data without instruction from Commerce to do so, Commerce is required to recalculate NTN's dumping margin using the best information otherwise available. If, however, Commerce did receive all the data or exercise its broad discretion in this matter and deemed the missing information unnecessary, then the dumping margin need not be recalculated.

2. U.S. Selling Expenses

Defendant-intervenors Koyo Seiko Company, Ltd. and Koyo Corporation of U.S.A. ("Koyo") granted discounts and rebates in the U.S. which were not tied directly to sales of covered merchandise. Commerce classified these discounts and rebates as indirect...