Yantai Timken Co., Ltd. v. U.S.

• Citation: 521 F.Supp.2d 1356
• Decision Date: 22 October 2007
• Docket Number: Slip Op. 07-151.,Court No. 06-00020.
• Parties: YANTAI TIMKEN CO., LTD. and The Timken Company, Plaintiffs, v. UNITED STATES of America, Defendant, and Peer Bearing Company, Defendant-Intervenor.
• Court: U.S. Court of International Trade

521 F.Supp.2d 1356

YANTAI TIMKEN CO., LTD. and The Timken Company, Plaintiffs, v. UNITED STATES of America, Defendant, and Peer Bearing Company, Defendant-Intervenor.

Slip Op. 07-151.

Court No. 06-00020.

United States Court of International Trade.

October 22, 2007.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Stewart and Stewart, Washington, DC (Terence P. Stewart, John D. Stirk and

William A. Fennell); Special Counsel: Geert DePrest, for Yantai Timken Co., Ltd. and The Timken Company, Plaintiffs.

Peter D. Keisler, Assistant Attorney General, Commercial Litigation Branch, Civil Division, United States Department of Justice, Jeanne E. Davidson, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Michael D. Panzera and L. Misha Preheim); Of Counsel: David Richardson, Senior Attorney, International Trade Administration, Department of Commerce, for the United States, Defendant.

Arent Fox, PLLC, (John M. Gurley, Nancy A. Noonan and Diana Dimitriuc Quaia) for Peer Bearing Company, Defendant-Intervenor.

OPINION

NICHOLAS TSOUCALAS, Senior Judge.

Plaintiffs Yantai Timken Co., Ltd. ("Yantai") and The Timken Company ("Timken") move pursuant to USCIT R. 56.2 for judgment upon the agency record challenging the determination of the International Trade Administration of the United States Department of Commerce ("Defendant" or "Commerce") in Tapered Roller Bearings and Parts Thereof; Finished or Unfinished, from the People's Republic of China, 71 Fed.Reg. 2,517 (Jan. 17, 2006) ("Final Results"), as amended 71 Fed.Reg. 9,521 (Feb. 24, 2006) ("Amended Final Results").¹

BACKGROUND

On June 15, 1987, Commerce issued an antidumping duty order covering tapered roller bearings and parts thereof, finished and unfinished ("TRBs"), from the People's Republic of China ("PRC"). See Tapered Roller Bearings and Parts Thereof; Finished or Unfinished, from the People's Republic of China, 52 Fed.Reg. 22,667 (June 15, 1987)("Antidumping Duty Order").

On June 1, 2004, Commerce published a notice of opportunity to request an administrative review of the Antidumping Duty Order for the period of review, June 1, 2003 through May 31, 2004 ("POR"). See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation: Opportunity to Request Administrative Review, 69 Fed.Reg. 30,873 (June 1, 2004). On June 30, 2004, Yantai requested that Commerce conduct a review of the entries of the TRBs that it exported to the United States for the POR. See Admin. R. Doc. 2. On July 28, 2004, Commerce initiated the seventeenth administrative review of the Antidumping Duty Order. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 69 Fed.Reg. 45,010 (July 28, 2004).

During the period August 5, 2004 through May 5, 2005, Yantai responded to Commerce's original questionnaire and six supplemental questionnaires. See Tapered Roller Bearings and Parts Thereof; Finished and Unfinished, from the People's Republic of China Preliminary Results of Antidumping Duty Administrative Review and Notice of Intent to Rescind in Part ("Preliminary Results"), 70 Fed. Reg. 39,744, 39,745 (July 11, 2005). During the period April 25 through April 29 2005, Commerce conducted a factors-of-production ("FOP") verification at Yantai's manufacturing plant in the PRC. See Preliminary Results, 70 Fed.Reg. at 39,746. During the period May 16 through May 19, 2005, Commerce conducted a constructed export price ("CEP") verification at the facilities of Yantai's parent company, Timken,² in Canton, Ohio. See id.

On June 30, 2005, Commerce issued the FOP and CEP verification reports. See Public Admin. R. Doc. 176 ("CEP Verification Report"); Public Admin. R. Doc. 177 ("FOP Verification Report"). In the verification reports, Commerce identified several factors of productions and expenses that were not verified, including U.S. rebates and commissions, U.S. indirect selling expenses ("ISEs"),³ electricity and gas consumption, and U.S. warehouse expenses. See id.

On July 11, 2005, Commerce issued the Preliminary Results, wherein Commerce found, inter alia, "that the information necessary to calculate an accurate and otherwise reliable margin is not available on the record with respect to Yantai." Preliminary Results, 70 Fed.Reg. at 39,749. Commerce further found that Yantai "withheld information, failed to provide information requested by [Commerce] in a timely manner and in the form required, significantly impeded the proceeding, and provided unverifiable information." Id. Thus, pursuant to sections 776(a)(2)(A), (B), (C) and (D) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1677e, Commerce preliminarily determined to resort to the facts otherwise available. Id. In addition, Commerce found that Yantai "failed to act to the best of its ability in supplying [Commerce] with the requested information." Id. at 39,750. Thus, pursuant to section 776(a) and (b), Commerce preliminarily determined to apply total adverse facts available in its calculation of the dumping margin. Id. at 39,751.

At a meeting held on July 19, 2005, Yantai requested permission from Commerce to submit additional information and/or explanations describing what it had demonstrated during verification regarding its ISEs. Pls.' Mem. P. & A. Supp. Mot. J. Agency R. ("Pls.' Mem.") at 12; Def.'s Resp. Mot. J. Agency R. ("Def.'s Resp.") at 11. On August 4, 2005, Yantai requested permission to "submit additional information for the record." Def.'s Resp. at 11; Public Admin. R. Doc. 189. On August 8, 2005, Yantai again requested permission to submit additional information and a chance to verify its reported information. See Def.'s Resp. at 11; Public Admin. R. Doc. 191. On August 15, 2005, Peer Bearing Company ("Peer"), a respondent in the administrative review, submitted a letter arguing that Commerce should reject Yantai's untimely factual information. See Def.'s Resp. at 11. On September 21, 2005, Commerce issued a letter denying Yantai's request. See Public Admin. R. Doc. 198.

On October 6, 2005, Yantai submitted its case brief. See Confidential Admin. R. Doe. 75. Thereafter, Commerce determined that portions of the case brief contained new factual information and requested that Yantai submit a revised case brief with the new information redacted. See Confidential Admin. R. Doc. 77. As a result of meetings between Yantai and Commerce held in October and November 2005, Commerce reconsidered its rejection of the materials previously deemed to be new factual information in Yantai's case brief and accepted some portions upon finding that they constituted argument of facts already on the record or information requested by Commerce. See Def.'s Resp. at 12-13; Confidential Admin. R. Doc. 77. Still other portions were determined to be new factual information and Commerce requested that Yantai submit a revised case brief redacting those portions. See Confidential Admin. R. Doc. 77.

On November 30, 2005, Yantai submitted its revised and redacted case brief arguing, inter alia, that: (1) it should not be given an adverse facts available rate because they cooperated to the best of their ability; and (2) Commerce apply partial adverse facts available because application of total adverse facts available was unwarranted. See Confidential Admin. R. Doc. 78. Peer submitted a rebuttal brief arguing that Yantai should continue to receive total adverse facts available. See Public Admin. R. Doc. 223. On December 9, 2005, Commerce held a hearing on the issues raised in the briefs of interested parties. See Pls.' Mem. at 13.

On January 17, 2006, Commerce published the Final Results, wherein Commerce determined, inter alia, that application of partial adverse facts available was warranted with respect to Yantai's ISEs, rebates and commissions. See Final Results 71 Fed.Reg. at 2520-21. Commerce found, inter alia, that Yantai could not substantiate its ISEs, rebates and commissions, and that Yantai did not act to the best of their ability to provide requested information to Commerce during verification. See id. Commerce thus used the total verified ISEs based on Timken's financial reports and applied to all sales the maximum amount of rebates and commissions that customers and sales agents could earn. See id. The antidumping margin was reduced from the total adverse facts available rate of 60.98% to a calculated rate including partial adverse facts available for the expenses that failed verification of 41.58%. See id. at 2523.

JURISDICTION

The Court has jurisdiction over this matter pursuant to 19 U.S.C. § 1516a (a) (2000) and 28 U.S.C. § 1581(c) (2000).

STANDARD OF REVIEW

In reviewing a challenge to Commerce's final determination in an antidumping administrative review, the Court will uphold Commerce's 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)(i) (2000). 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). In an administrative review, the court cannot substitute its judgment for that of Commerce when the choice is "between two fairly conflicting views, even...