Torrington Co. v. US, Court No. 91-08-00567.

• Decision Date: 20 August 1993
• Docket Number: Court No. 91-08-00567.
• Citation: 832 F. Supp. 379
• Parties: The TORRINGTON COMPANY, Plaintiff, Federal-Mogul Corporation, Plaintiff-Intervenor, v. UNITED STATES, Defendant, SKF USA Inc. and SKF GmbH; GMN Georg Muller Nurnberg AG; NTN Bearing Corporation of America and NTN Kugellagerfabrik (Deutschland) GmbH; Caterpillar Inc.; FAG Kugelfischer Georg Schaefer KGaA; INA Walzlager Schaeffler KG and INA Bearing Company, Inc.; Messerschmitt-BoelkowBlohm, GmbH and MBB Helicopter Corporation, Defendant-Intervenors.
• Court: U.S. Court of International Trade

832 F. Supp. 379

The TORRINGTON COMPANY, Plaintiff Federal-Mogul Corporation, Plaintiff-Intervenor, v. UNITED STATES, Defendant SKF USA Inc. and SKF GmbH; GMN Georg Muller Nurnberg AG; NTN Bearing Corporation of America and NTN Kugellagerfabrik (Deutschland) GmbH; Caterpillar Inc.; FAG Kugelfischer Georg Schaefer KGaA; INA Walzlager Schaeffler KG and INA Bearing Company, Inc.; Messerschmitt-BoelkowBlohm, GmbH and MBB Helicopter Corporation, Defendant-Intervenors.

Court No. 91-08-00567.

United States Court of International Trade.

August 20, 1993.

Stewart and Stewart, Eugene L. Stewart, Terence P. Stewart, James R. Cannon, Jr., Wesley K. Caine, Myron A. Brilliant, Geert De Prest, Margaret E.O. Edozien, Robert A. Weaver, David Scott Nance and Amy S. Dwyer, Washington, DC, for plaintiff The Torrington Co.

Frederick L. Ikenson, P.C., Frederick L. Ikenson, J. Eric Nissley and Joseph A. Perna, V, Washington, DC, for plaintiff-intervenor Federal-Mogul Corp.

Frank W. Hunger, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civ. Div., U.S. Dept. of Justice, Velta A. Melnbrencis and Jane E. Meehan; John D. McInerney, Acting Deputy Chief Counsel for Import Admin., Dean A. Pinkert, Stephen J. Claeys and Douglas S. Cohen, Attorney-Advisors, Office of the Chief Counsel for Import Admin., U.S. Dept. of Commerce, Washington, DC, of counsel, for defendant.

Howrey & Simon, Herbert C. Shelley, Scott A. Scheele, Alice A. Kipel, Juliana M. Cofrancesco and Thomas Trendl, Washington, DC, for defendant-intervenors SKF USA Inc. and SKF GmbH.

Grunfeld, Desiderio, Lebowitz & Silverman, Bruce M. Mitchell and Philip S. Gallas, New York City, for defendant-intervenor GMN Georg Muller Nurnberg AG.

Barnes, Richardson & Colburn, Robert E. Burke, Donald J. Unger, Kazumune V. Kano

and Diane A. MacDonald, Chicago, IL, for defendant-intervenors NTN Bearing Corp. of America and NTN Kugellagerfabrik (Deutschland) GmbH.

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

Grunfeld, Desiderio, Lebowitz & Silverman, Max F. Schutzman, David L. Simon, Andrew B. Schroth and Matthew L. Pascocello, New York City, for defendant-intervenor FAG Kugelfischer Georg Schafer KGaA.

Arent Fox Kintner Plotkin & Kahn, Stephen L. Gibson and Eleanor Pelta, Washington, DC, for defendant-intervenors INA Walzlager Schaeffler KG and INA Bearing Co., Inc.

Rogers & Wells, William Silverman and Ryan Trainer, Washington, DC, for defendant-intervenor Messerschmitt-Boelkow-Blohm GmbH and MMB Helicopter Corp.

OPINION

TSOUCALAS, Judge:

Plaintiff, The Torrington Company ("Torrington"), moves pursuant to Rule 56.1 of the Rules of this Court for judgment on the agency record, challenging certain aspects of the Department of Commerce, International Trade Administration's ("ITA") final results in the first administrative review of imports of antifriction bearings from the Federal Republic of Germany. Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From the Federal Republic of Germany; Final Results of Antidumping Duty Administrative Review ("Final Results"), 56 Fed.Reg. 31,692 (1991).

Background

On June 11, 1990, the ITA initiated an administrative review of imports of ball bearings, cylindrical roller bearings, spherical plain bearings and parts thereof from the Federal Republic of Germany. 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, 55 Fed. Reg. 23,575 (1990).

On March 15, 1991, the ITA published its preliminary determination in the administrative review. Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From the Federal Republic of Germany; Preliminary Results of Antidumping Duty Administrative Reviews and Partial Termination of Administrative Reviews, 56 Fed.Reg. 11,200 (1991).

On July 11, 1991, the ITA published its Final Results in this proceeding. Final Results, 56 Fed.Reg. 31,692.

Torrington moves pursuant to Rule 56.1 of the Rules of this Court for summary judgment on the agency record alleging that the following actions by the ITA were unsupported by substantial evidence on the administrative record and not in accordance with law: the ITA's (1) use of a methodology for adjusting United States price ("USP") and Foreign Market Value ("FMV") for Germany's value added tax ("VAT") that granted a circumstance of sale ("COS") adjustment to FMV to achieve tax neutrality; (2) method of calculating cash deposit rates for estimated duties; (3) in regard to exporter's sales price ("ESP") transactions, allowance of an adjustment to FMV for inventory carrying costs; (4) failure to verify FAG Kugelfischer Georg Schaefer KGaA's ("FAG") cost response; (5) failure to verify INA Walzlager Schaeffler KG's ("INA") cost response; (6) adjustment to FMV for SKF GmbH's ("SKF") pre-sale inland freight; (7) treatment of SKF's home market discounts; and (8) allowance of a COS adjustment for FAG's currency hedging expenses. Memorandum in Support of Plaintiff The Torrington Company's Motion for Judgment on the Agency Record ("Torrington's Memorandum") at 9-67.

Discussion

This Court's jurisdiction over this matter is derived from 19 U.S.C. § 1516a(a)(2) (1988) and 28 U.S.C. § 1581(c) (1988).

A final determination by the ITA in an administrative proceeding will be sustained unless that 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 "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, 216, 83 L.Ed. 126 (1938); Alhambra Foundry Co. v. United States, 12 CIT 343, 345, 685 F.Supp. 1252, 1255 (1988).

1. Circumstance of Sale Adjustment to FMV for Value Added Tax

Torrington challenges the ITA's use of a methodology for adjusting USP and FMV for Germany's VAT that granted a COS adjustment to FMV to achieve tax neutrality. Torrington's Memorandum at 31-33.

Defendant argues that its actions were supported by substantial evidence on the administrative record and otherwise in accordance with law. Defendant's Memorandum in Opposition to Plaintiff's Motion for Judgment Upon the Agency Record ("Defendant's Memorandum") at 12-38.

For a more detailed discussion of Torrington and defendant's arguments on this issue, see this Court's decision in Torrington Co. v. United States, 17 CIT ___, ___, 818 F.Supp. 1563, 1567-69 (1993).

SKF, FAG, INA, GMN Georg Muller Nurnberg AG ("GMN"), NTN Bearing Corporation of America and NTN Kugellagerfabrik (Deutschland) GmbH ("NTN") essentially agree with the defendant's arguments on this issue. Opposition of SKF USA Inc. and SKF GmbH to Torrington's Motion for Judgment on the Agency Record ("SKF's Opposition") at 4-8; Memorandum of Defendant-Intervenor FAG Kugelfischer Georg Schaefer KGaA ("FAG") in Opposition to Plaintiff's Motion for Judgment Upon the Agency Record ("FAG's Memorandum") at 51-56; Memorandum of INA Walzlager Schaeffler KG and INA Bearing Company, Inc. in Opposition to Plaintiff The Torrington Company's Motion for Judgment on the Agency Record ("INA's Memorandum") at 11-14; Memorandum of Defendant-Intervenor GMN Georg Muller Nurnberg AG ("GMN") in Opposition to Plaintiff's Motion for Judgment Upon the Agency Record ("GMN's Memorandum") at 23-28; Response Brief of Defendant-Intervenor NTN Bearing Corporation of America and NTN Kugellagerfabrik (Deutschland) GmbH ("NTN's Brief") at 8-19.

This Court has fully addressed these arguments and adheres to its decision on this issue in Federal-Mogul Corp. v. United States, 17 CIT ___, ___, 813 F.Supp. 856, 863-65 (1993). This Court remands this issue to the ITA to allow the ITA to add the full amount of VAT paid on home market sales to FMV without adjustment.

2. Calculation of Cash Deposit Rates

In this administrative review, the ITA used two different methodologies for the actual calculation of dumping margins in cases where ESP sales were used: one for assessing duties on entries covered by the review, and the other for setting the cash deposit rate on future entries of the subject merchandise. Final Results, 56 Fed.Reg. at 31,693-95, 31,698-702. To calculate the assessment rate for ESP sales, the ITA "divided the total PUDD potential uncollected dumping duties — calculated as the total difference between foreign market value and U.S. price for an exporter for the reviewed sales by the total entered value of those reviewed sales...." Final Results, 56 Fed.Reg. at 31,698-99 (emphasis added). To calculate the estimated cash deposit rate for ESP sales, the ITA "divided the total PUDD for each exporter by the total net U.S. price for that exporter's sales...." Id. at 31,699 (emphasis added).

Torrington argues that the ITA's use of a methodology which results in an estimated cash deposit rate different from the assessment duty rate was unsupported by substantial evidence on the record and not in accordance with law. Torrington's Memorandum at 64-67.

Defendant argues that its actions were supported by substantial evidence on the administrative record and otherwise in accordance with law. Defendant's Memorandum at 59-66. In addition, defendant argues that this issue is moot because of the publication of superseding cash deposit rates in Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France; et al.; Final Results of Antidumping Duty Administrative Reviews, 57 Fed.Reg. 28,360 (1992). Defendant's Memorandum at 57-59.

For a more detailed discussion of Torrington and defendant's arguments on this issue, see this Court's decision in Torrington Co., 17 CIT at ___, 818 F.Supp. at 1569.

SKF,...