Slip Op 04-21
UNITED STATES COURT OF INTERNATIONAL TRADE
BEFORE: NICHOLAS TSOUCALAS, SENIOR JUDGE
________________________________________
:
TIMKEN US CORPORATION and :
TIMKEN NADELLAGER, GmbH, :
:
Plaintiffs, :
: Court No.
v. : 00-09-00454
:
UNITED STATES, :
:
Defendant. :
________________________________________:
Plaintiffs, Timken US Corporation (“Timken”) and Timken
Nadellager, GmbH (“TNG”), move pursuant to USCIT R. 56.2 for
judgment upon the agency record challenging one aspect of the
United States Department of Commerce’s (“Commerce”) determination
entitled Final Results of Antidumping Duty Administrative Reviews
and Revocation of Orders in Part on Antifriction Bearings (Other
Than Tapered Roller Bearings) and Parts Thereof From France,
Germany, Italy, Japan, Romania, Singapore, Sweden, and the United
Kingdom (“Final Results”), 65 Fed. Reg. 49,219 (Aug. 11, 2000).
Specifically, plaintiffs contend that Commerce erred by refusing to
correct an error in reporting channels of distribution for TNG, an
affiliated company of Timken and German producer of cylindrical
roller bearings (“CRBs”). Commerce maintains that Timken failed to
demonstrate that the error was clerical in nature and argues that
the record supports Commerce’s finding that the alleged error was
either a substantive issue or an error in judgment.
Held: Plaintiffs’ 56.2 motion is granted. Case remanded.
March 5, 2004
Stewart and Stewart (Terence P. Stewart, Geert De Prest and
Lane S. Hurewitz) for Timken US Corporation and Timken Nadellager,
GmbH, plaintiffs.
Peter D. Keisler, Assistant Attorney General; David M. Cohen,
Director, Commercial Litigation Branch, Civil Division, United
States Department of Justice (Claudia Burke); of counsel: Augusto
Court No. 00-09-00454 Page 2
Guerra, Office of the Chief Counsel for Import Administration,
United States Department of Commerce, for the United States,
defendant.
OPINION
TSOUCALAS, Senior Judge: Plaintiffs, Timken US Corporation1
(“Timken”) and Timken Nadellager, GmbH2 (“TNG”), move pursuant to
USCIT R. 56.2 for judgment upon the agency record challenging one
aspect of the United States Department of Commerce’s (“Commerce”)
determination entitled Final Results of Antidumping Duty
Administrative Reviews and Revocation of Orders in Part on
Antifriction Bearings (Other Than Tapered Roller Bearings) and
1
This action was originally brought by The Torrington
Company and Torrington Nadellager GmbH in September 2000. See
Summons ¶ 1. The Torrington Company was acquired by the Timken
Company on February 18, 2003, and is now known as Timken US
Corporation. Timken’s German affiliate is now known as Timken
Nadellager, GmbH (“TNG”). See Disclosure of Corporate Affiliations
& Fin. Interest at 1 (filed with this Court on Feb. 3, 2004).
Timken appeared as a respondent in the subject reviews before
Commerce and appears before this Court in the same capacity.
2
This action challenges the final results of the tenth
administrative review of antifriction bearings from Germany, which
cover CRBs produced by TNG. Cylindrical roller bearings produced
by TNG were also subject to the eighth and ninth administrative
reviews in which Commerce determined de minimis dumping margins for
the subject product. See Final Results of Antidumping Duty
Administrative Reviews on Antifriction Bearings (Other Than Tapered
Roller Bearings) and Parts Thereof From France, Germany, Italy,
Japan, Romania, Sweden, and the United Kingdom, 64 Fed. Reg.
35,590, 35,591 (July 1, 1999); Final Results of Antidumping Duty
Administrative Reviews on Antifriction Bearings (Other Than Tapered
Roller Bearings) and Parts Thereof From France, Germany, Italy,
Japan, Romania, Singapore, Sweden, and the United Kingdom, 63 Fed.
Reg. 33,320, 33,321 (June 18, 1998) (collectively “eighth and ninth
administrative reviews”).
Court No. 00-09-00454 Page 3
Parts Thereof From France, Germany, Italy, Japan, Romania,
Singapore, Sweden, and the United Kingdom (“Final Results”), 65
Fed. Reg. 49,219 (Aug. 11, 2000). Specifically, plaintiffs contend
that Commerce erred by refusing to correct an error in reporting
channels of distribution for TNG, an affiliated company of Timken
and German producer of cylindrical roller bearings (“CRBs”).
Commerce maintains that Timken failed to demonstrate that the error
was clerical in nature and argues that the record supports
Commerce’s finding that the alleged error was either a substantive
issue or an error in judgment.
BACKGROUND
The administrative review at issue involves the period of
review covering May 1, 1998, through April 30, 1999.3 See Final
Results, 65 Fed. Reg. at 49,219. Commerce published the
preliminary results of the subject reviews on April 6, 2000. See
Preliminary Results of Antidumping Duty Administrative Reviews,
Partial Rescission of Administrative Reviews, and Notice of Intent
to Revoke Orders in Part on Antifriction Bearings (Other Than
3
Since the administrative review at issue was initiated
after December 31, 1994, the applicable law is the antidumping
statute as amended by the Uruguay Round Agreements Act (“URAA”),
Pub. L. No. 103-465, 108 Stat. 4809 (1994) (effective January 1,
1995). See Torrington Co. v. United States, 68 F.3d 1347, 1352
(Fed. Cir. 1995) (citing URAA § 291(a)(2), (b) (noting effective
date of URAA amendments)).
Court No. 00-09-00454 Page 4
Tapered Roller Bearings) and Parts Thereof From France, Germany,
Italy, Japan, Romania, Singapore, Sweden, and the United Kingdom
(“Preliminary Results”), 65 Fed. Reg. 18,033. Commerce published
the Final Results at issue on August 11, 2000.
JURISDICTION
The Court has jurisdiction over this matter pursuant to 19
U.S.C. § 1516a (2000) and 28 U.S.C. § 1581(c) (2000).
STANDARD OF REVIEW
The Court will uphold Commerce’s final determination in an
antidumping 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); see NTN
Bearing Corp. of Am. v. United States, 24 CIT 385, 389-90, 104 F.
Supp. 2d 110, 115-16 (2000) (detailing Court’s standard of review
in antidumping proceedings).
DISCUSSION
A. Factual Background
During the tenth administrative review, Commerce instructed
Timken to report the channels of distribution for TNG’s home market
sales. See App. Timken’s Mem. Supp. R. 56.2 Mot. J. Upon Agency R.
Court No. 00-09-00454 Page 5
(“Timken’s App.”) Tab 4 at 1. Commerce indicated that “the
information [was] necessary to make appropriate comparisons of
sales at the same level of trade or to adjust normal value, if
appropriate, when sales are compared at different levels of trade.”
Def.’s Mem. Opp’n Pls.’ Mot. J. Upon Agency R. (“Def.’s Mem.”) Ex.
1 at A-4 (emphasis omitted). In response to this request, Timken
identified five distribution channels corresponding to customer
categories for TNG’s home market sales, including: (1) factory to
large original equipment manufacturers (“OEMs”) (“channel 1”); (2)
factory to other OEMs (“channel 2”); (3) factory to distributors
(“channel 3”); (4) TNG to OEM customers (“channel 4”); and (5) TNG
to distributor customers (“channel 5”). See Timken’s App. Tab 3 at
A-21 — A-24. Timken also described the sales process for each
channel of distribution. See id.
Commerce eventually “conducted a sales verification” of Timken
in February 2000, and subsequently issued an analysis memorandum
for the Preliminary Results entitled Issues and Decision Memorandum
for the Administrative Reviews of Antifriction Bearings (other than
tapered roller bearings) and parts thereof from France, Germany,
Italy, Japan, Romania, Singapore, Sweden, and the United Kindom -
May 1 1998, through April 30, 1999 (“Issues & Decision Mem.”). See
id. Tab 10 at 1. In its decision memorandum, “Commerce explained
that for the five channels of distribution reported by [TNG] in its
Court No. 00-09-00454 Page 6
[home market] sales listing, [a senior import compliance
specialist] examined the selling activities, the point in the
channel of distribution at which the selling activities occurred,
and the types of customers that purchased the foreign like product
from [TNG].” Def.’s Mem. at 5. Commerce determined that three
channels of distribution were for home market sales by TNG, and the
remaining two channels of distribution were for “resales” by TNG’s
affiliated marketing entity. See Timken’s App. Tab 4 at 3. As a
result, Commerce re-designated channel 1 as HM1 (home market 1),
grouped channels 4 and 5 together and re-designated them HM2 (home
market 2) and also grouped channels 2 and 3 together and re-
designated them HM3 (home market 3). See id. Essentially,
Commerce grouped channels 4 and 5 and channels 2 and 3 together
upon a determination that the points in which selling activities
occurred within these different channels of distribution were
indistinguishable. See id.
In determining the dumping margin, Commerce used constructed
value (“CV”) when no sales existed of “an identical or similar
model sold in the home market or when the identical or similar
model was disregarded as below cost.” Id. at 7.4 “Profit was
4
Under post-URAA law, pursuant to 19 U.S.C. §§ 1677b(a)
(1) and 1677(16) (1994), Commerce must first look to identical
merchandise in matching the United States model to the comparable
home market model. If a determination cannot be satisfactorily made
using identical merchandise, Commerce must look to like
Court No. 00-09-00454 Page 7
calculated by multiplying the level-of-trade-specific weighted-
average profit rate calculated on home market sales made in the
ordinary course of trade by the cost of production . . . of the
model.” Id. Based on this analysis, Commerce calculated a dumping
margin of 61.60 percent for CRBs produced by TNG. See id. at 1;
Final Results, 65 Fed. Reg. at 49,221; Preliminary Results, 65 Fed.
Reg. at 18,041.
B. Timken’s Contentions
Timken states that in responding to Commerce’s request for
information, Timken relied on “customer names to classify its home
market sales according to distribution channel.” Timken’s Mem.
Supp. R. 56.2 Mot. J. Upon Agency R. (“Timken’s Mem.”) at 6. As a
result, a certain number of transactions were unintentionally
reported in channel 1 instead of channel 2 or channel 3.
Ultimately, these transactions were grouped into HM1 instead of
HM3. See id. at 7-13.
According to Timken, these misclassifications can be grouped
into three broad fact patterns. First, Timken inadvertently
reported a certain number of transactions as sales to large OEMs
instead of classifying them as sales to small OEMs. See id. at 7.
Second, Timken unintentionally reported a certain number of
merchandise—initially under the second category and, if that is not
available, under the third category.
Court No. 00-09-00454 Page 8
transactions as sales for the production of large original
equipment instead of sales for use as replacement parts. See id.
at 8. Third, Timken mistakenly reported a certain number of
transactions as sales to large OEMs instead of labeling them as
“units sold as samples, [that] were delivered to the customer’s
prototype center.” Id. at 10 (emphasis omitted). “Although
Commerce verified [Timken’s] home market sales, [Timken argues that
Commerce] did not pursue the classification o[f] individual
transactions into their appropriate distribution channels at
verification.” Id. at 11 (citations omitted).
Timken claims that Commerce’s subsequent calculation of an
abnormally high CV profit rate resulted from these misclassified
transactions. See id. at 11-12. According to Timken, these
transactions only covered a minimal percentage “of all units sold
in the [level of trade (“LOT”)] (as a percentage of sales quantity
reported in the home market sales listing).” Id. at 11. Timken
maintains that the remaining sales in the LOT were “disregarded”
because Commerce found them to have been made at prices below cost
of production (“COP”). See id. Timken further claims that the
calculation of an abnormal CV profit rate caused Commerce to
compute an inaccurate dumping margin. See id. at 11-12.
During the administrative review, Timken identified these
mistakes and requested that Commerce either correct Timken’s
Court No. 00-09-00454 Page 9
“inadvertent errors by reclassifying certain home market sales, or
. . . in the alternative, combine all home market LOTs in the CV-
profit calculation and use that rate for home market LOT.” Id. at
12 (emphasis omitted). Timken supplied supporting documentation
and claims that Commerce did not indicate that such information was
inadequate, nor did Commerce request additional supporting
evidence. See id. at 12-13.
In the Issues & Decision Mem., Commerce rejected Timken’s
arguments that the errors should be corrected because Timken did
not show that these errors were clerical in nature. See Timken’s
App. Tab 10 at 50-52. Timken contends that Commerce is mandated to
correct these errors because they were unintentional and because
“Commerce’s goal in administrative reviews is to determine margins
‘as accurately as possible.’” Timken’s Mem. at 17 (citing Rhone
Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed. Cir.
1990)). Timken argues that the present situation involving mis-
classified channels of distribution is similar to the mis-
categorized sales situation identified in NTN Bearing Corp. v.
United States, 74 F.3d 1204, 1206-09 (Fed. Cir. 1995). See
Timken’s Mem. at 17-18, 26-31. Timken points out that in NTN, the
United States Court of Appeals for the Federal Circuit (“CAFC”)
held that “Commerce should correct inadvertent ‘clerical’ errors
made by respondents to avoid manifestly unjust results, even if the
Court No. 00-09-00454 Page 10
errors are discovered subsequent to the deadline for submitting
information, and even if the error is not obvious from [the] record
at the time.” Id. at 18 (citing NTN Bearing, 74 F.3d at 126-09)
(emphasis added). Timken also points out that precedent has
cautioned Commerce “not to draw distinctions between ‘substantive’
and ‘clerical’ errors in an overly narrow manner.” Id. (citing
World Finer Foods, Inc. v. United States, 24 CIT 541, 550 (2000)).
While Timken admits that the relevant statute, legislative
history and agency regulations do not directly address the issue of
inadvertent errors committed by respondents, Timken argues that
each supports the proposition that unintentional errors should be
corrected. See id. at 22-26. Timken also raises issue with
Commerce’s position that errors of judgment are distinguishable
because such a finding is “inconsistent with the caveat articulated
in World Finer Foods that ‘[w]here the line is difficult to draw
between permissible ministerial or clerical error correction and
impermissible factual or methodological changes,” Commerce should
classify such error as clerical. Id. at 27 (quoting World Finer
Foods, 24 CIT at 550).
Finally, Timken applies the test established by Commerce in
Final Results of Antidumping Duty Administrative Reviews of Certain
Fresh Cut Flowers From Columbia (“Columbian Flowers”), 61 Fed. Reg.
42,833, 42,834 (Aug. 19, 1996), and cited by Commerce in the Final
Court No. 00-09-00454 Page 11
Results, to the facts of this case and argues that its errors “are
analogous to the types of errors Commerce determined to be
‘clerical’ errors and which were corrected in [Columbian] Flowers.”
Timken’s Mem. at 30. Accordingly, Timken maintains that Commerce
improperly refused to correct the error identified by Timken in the
subject review.
C. Analysis
The antidumping statute requires Commerce to calculate dumping
margins as accurately as possible in each administrative review.
See Fujian Mach. & Equip. Imp. & Exp. Corp. v. United States, 25
CIT ___, ___, 178 F. Supp. 2d 1305, 1322 (2001) (citing Rhone
Poulenc, 899 F.2d at 1191). “[A]ntidumping laws are not punitive
in nature, but are designed to remedy the inequities caused by
unfair trade practices.” Allied Tube & Conduit Corp. v. United
States, 24 CIT 1357, 1370, 127 F. Supp. 2d 207, 218 (2000); see
NTN, 74 F.3d at 1208 (stating that “the antidumping laws are
remedial not punitive” (citing Chaparral Steel Co. v. United
States, 901 F.2d 1097, 1103-04 (Fed. Cir. 1990))). Although
antidumping laws “afford the domestic manufacturer strong
protection against dumping,” Commerce is still required to “make a
fair and equitable valuation, which may [ultimately] reduce the
antidumping margin.” Smith-Corona Group v. United States, 713 F.2d
1568, 1576 (Fed. Cir. 1983), cert. denied, 465 U.S. 1022 (1984).
Court No. 00-09-00454 Page 12
These two competing purposes seem to conflict with each other. See
American Permac, Inc. v. United States, 12 CIT 1134, 1137, 703 F.
Supp. 97, 100 (1988). On the one hand, Commerce is commissioned to
protect the domestic industry from unfair trade practices and on
the other, Commerce is responsible for promoting free trade. See
id. In application, however, the “two purposes of the statute
complement, rather than conflict with each other.” Id.
When applying these notions to the issue at bar, the Court
recognizes that Commerce often establishes policies to ensure the
consistent procedural application of antidumping laws. See Allied
Tube, 24 CIT at 1370, 127 F. Supp. 2d at 218-19 (stating that
“[f]air and equitable margins are calculated when the administering
authorities are consistent in their procedural application of the
law”). In the past, Commerce corrected a respondent’s own clerical
errors only if Commerce “could assess from information already on
the record that an error ha[d] been made, that the error [was]
obvious from the record, and that the correction [was] accurate.”
Def.’s Mem. at 26. As a result of the CAFC’s holding in NTN,5
5
NTN involved the inadvertent use of a code for high
precision bearing tolerances rather than the standard precision
bearing tolerances and the listing of four sales to foreign
customers as sales to domestic customers. See NTN, 74 F.3d at
1205. Commerce rejected the respondent’s request for correction
upon a finding that “the errors were not obvious from the record
and that the deadline for submitting new information had expired.”
Id. The CAFC held, however, that the “requirement that the record
disclose the error essentially preclude[d] correction of clerical
Court No. 00-09-00454 Page 13
however, Commerce reevaluated its policy for correcting clerical
errors of respondents and developed the six-part Columbian Flowers
Test.6 In its Issues & Decision Mem., Commerce explained that
Timken failed to satisfy the first and second criteria of this
test. See Timken’s App. Tab 10 at 50-52.
The first prong of the Columbian Flowers Test states that
Commerce accepts respondent’s corrections if the error in question
is demonstrated to be clerical. Clerical errors have been defined
errors made by a respondent. Where clerical personnel of a
respondent transpose code numbers, the existing administrative
record will not disclose that such error occurred.” Id. at 1208.
The CAFC also held that “while it may be a reasonable exercise of
[an agency] to restrict the correction of its own clerical errors
to those obvious from the record, the same rule applied to a
respondent’s errors becomes arbitrary.” Id.
6
In Columbian Flowers, Commerce stated that it would
accept corrections of clerical errors under the following
conditions: (1) [t]he error in question must be
demonstrated to be a clerical error, not a methodological
error, an error in judgment, or a substantive error; (2)
[Commerce] must be satisfied that the corrective
documentation provided in support of the clerical error
allegation is reliable; (3) the respondent must have
availed itself of the earliest reasonable opportunity to
correct the error; (4) the clerical error allegation, and
any corrective documentation, must be submitted to
[Commerce] no later than the due date for the
respondent’s administrative case brief; (5) the clerical
error must not entail a substantial revision of the
response; and (6) the respondent’s corrective
documentation must not contradict information previously
determined to be accurate at verification.
Columbian Flowers (“Columbian Flowers Test”), 61 Fed. Reg. at
42,834.
Court No. 00-09-00454 Page 14
as mistakes “made by a clerk or other subordinate, upon whom
devolved no duty to exercise judgment, in writing or copying the
figures or in exercising his intention.” PPG Indus., Inc. v.
United States, 7 CIT 118, 124 (1984) (citations omitted).
Inadvertencies, on the other hand, have been described as “an
oversight or involuntary accident, or the result of inattention or
carelessness.” Id. (citing C.J. Tower & Sons of Buffalo, Inc. v.
United States, 68 Cust. Ct. 17, 22, 336 F. Supp. 1395, 1399 (1972),
aff’d, 61 CCPA 90, C.A.D. 1129, 499 F.2d 1277 (1974)).
In its supporting brief, Timken argues that Commerce has
applied a broader definition of “clerical errors” in past reviews.
In fact, Commerce applied the Columbian Flowers Test and accepted
the inclusion of a non-subject merchandise sale in the dumping
margin as a clerical error in its Issues and Decision Memorandum
for the Final Results of the Antidumping Duty Administrative Review
and Final Determination Not to Revoke in Part for Canned Pineapple
Fruit from Thailand, 2000 WL 1880665 at Cmt. 6 (Dec. 13, 2000).
Commerce also found an error in coding the date of sale for one
quarter of a customer’s contracts to be clerical in Final Results
of Antidumping Duty Administrative Review of Certain Cold-rolled
Carbon Steel Flat Products from the Netherlands, 64 Fed. Reg.
11,825 (Mar. 10, 1999). However, in neither of these cases, nor in
other holdings referenced by Timken, see Timken’s Mem. at 31, does
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the respondent commit the same error in two prior reviews. In the
present case, Timken admits that it misclassified home market sales
of the same subject merchandise in the eighth and ninth
administrative reviews, but argues the misclassifications did not
result in any meaningful changes to the dumping margins. See supra
text accompanying note 2. Nonetheless, this Court agrees with
Commerce’s determination that the error at issue was not clerical.
Moreover, the Court does not accept Timken’s interpretation of the
law that Commerce should correct the error simply because it was
inadvertent, see Timken’s Reply Br. at 2, since such a finding
would broaden the holding of NTN.
Commerce proffers a harsh interpretation of the facts of this
case. Commerce states that
in preparing the data for channels of distribution, as in
prior reviews, [Timken] relied on the customer names to
classify its home market sales according to distribution
channel. Thereby, [Timken] exercised judgment, based
upon its examination of its own documents and procedures,
that sales to particular customers properly belonged in
Channel 1 as sales to “large” OEMs, because of the
various distribution and sales activities that were
incurred with respect to the sales to these “large” OEMs.
[Timken’s] coding of the sales at issue as sales to
“large OEMs,” thus, was neither a ministerial nor
clerical error, but a deliberate and intentional
decision, based upon its actions in prior reviews.
Def.’s Mem. at 28-29 (emphasis in original). Commerce compares the
facts of this case with those in Hambro Auto. Corp. v. United
States, 66 CCPA 113, 117-20, C.A.D. 1231, 603 F.2d 850, 853-55
Court No. 00-09-00454 Page 16
(1979), and argues that the Court should render the
misclassifications an error in judgment or a mistake of law. See
Def.’s Mem. at 29. Commerce’s reliance on Hambro is misplaced.
Hambro concerned an importer’s challenge to a denial of
protests filed after the government refused the importer’s request
for reliquidation of certain entries. See Hambro, 66 CCPA at 117,
603 F.2d at 850. The alleged errors involved statutory values that
were calculated by subtracting (rather than adding) cost of export
divisions from home market cost figures. See Hambro, 66 CCPA at
188-19, 603 F.2d at 854. In Hambro, the “errors” were deemed a
mistake of law because the importer was fully aware of its general
expenses and profits, but believed the legal consequences of such
values to be different than they were. See Hambro, 66 CCPA at
117-20, 603 F.2d at 853-55. Unlike the importer in Hambro, Timken
did not realize that it misclassified certain home market sales,
nor was Timken cognizant of the legal consequences of its error
until the dumping margins were calculated in the Preliminary
Results. See Timken’s Mem. at 17-36.
A complete review of the confidential material of this case
reveals a situation where rigid compliance with the Columbian
Flowers Test would render a grossly erroneous dumping margin.
Timken’s misclassified transactions covered only a minuscule
percentage of all units sold in the LOT. See Timken’s Mem. at 7-10
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(proprietary version). The remaining sales in the LOT were
disregarded in Commerce’s profit calculation because they were to
be sold at prices below the COP. See id. Ultimately, Commerce
calculated an extremely high CV profit rate and a dumping margin of
61.60 percent based only upon a few misclassified sales. See
Timken’s App. Tabs 2, 4, 7 (proprietary version). Timken contends
that it “had no knowledge or reason to believe” that its reliance
on customer names would result in any misclassifications. Timken’s
Mem. at 6. Commerce argues that since Timken used the same
reporting method in the eighth and ninth reviews, Timken’s action
in the tenth review was indeed calculated. See Def.’s Mem. at 28-
29. Since the classification of Timken’s home market sales was
never an issue addressed in the eighth and ninth administrative
reviews, this Court cannot reach the conclusion that Timken
intentionally misclassified transactions to attain a desired
dumping margin.
The Court, alternatively, must balance the interest of
protecting Commerce’s authority to create and implement policy to
protect the domestic industry from unfair trade practices, and its
correlating obligation “to calculate the most accurate dumping
margins possible.” Shandong Huarong Gen. Corp. v. United States,
25 CIT ___, ___, 159 F. Supp. 2d 714, 727 (2001), aff’d, 2003 U.S.
App. LEXIS 466 (Fed. Cir. Jan. 10, 2003), reh’g denied en banc,
Court No. 00-09-00454 Page 18
2003 U.S. App. LEXIS 6759, *1 (Fed. Cir. Mar. 18, 2003). Commerce
directed Timken to provide a description of its channels of
distribution and sales process and clarified that the information
is “intended to provide [Commerce] with the information necessary
to make appropriate comparisons of sales at the same level of trade
or to adjust [NV,] if appropriate, when sales are compared at
different levels of trade.” Timken’s App. Tab 10 at 50. Commerce
also cautioned Timken that the information was of “critical
importance.” These instructions are intended to solicit accurate
information that Commerce must utilize to calculate the antidumping
margins. Cf. Acciai Speciali Terni, S.p.A. v. United States, 25
CIT ___, ___, 142 F. Supp. 2d 969, 982 (2001) (stating that “[i]t
is respondent’s obligation to supply Commerce with accurate
information” (citations omitted)). Had Timken followed these
instructions, perhaps this case would not be before this Court.
The Court cautions Timken to pay closer attention to the manner in
which it classifies and reports future home market sales
transactions. Commerce, with its limited resources, cannot be
expected “to serve as a surrogate to guarantee the correctness of
submissions.” Id. (quoting Yamaha Motor Co. v. United States, 19
CIT 1349, 1359, 910 F. Supp. 679, 687 (1995)). Although the Court
recognizes that the burden falls on a respondent to provide
accurate information, it is unreasonable to believe that a
respondent can do so in each and every review without committing
Court No. 00-09-00454 Page 19
occasional errors. See Shandong, 25 CIT at ___, 159 F. Supp. 2d at
727 (holding that a restriction of Commerce’s power to correct
ministerial errors would undermine its “underlying obligation to
calculate the most accurate dumping margins possible”).
Upon publication of the estimated dumping margin in the
Preliminary Results, Timken “reexamined its submission and
discovered the inadvertent channel of distribution classification
errors (re[garding] home market LOT 1).” Timken’s Mem. at 12.
Timken thereafter submitted documentation clarifying the correct
channel of distribution classifications. See id. Commerce
contends that such documentation is not reliable and, therefore,
Timken’s clerical error claims also fail to satisfy the second
prong of the Columbian Flowers Test. Commerce determined that
Timken’s purchase orders, invoices, and notes (some handwritten)
were unreliable because “certain record evidence conflict[ed] with”
the supplemental information. Timken’s App. Tab 10 at 52. In its
supporting brief, Commerce states:
The conflict, of course, existed between [Timken’s]
original description of distribution channel 1 . . .
which included prototype and sample sales . . . and
[Timken’s] request re-categorization of the prototype and
sample sales at issue as sales to “other” OEMs or sales
to “distributors.” There was also conflict between
Commerce’s conclusions in its verification report and its
preliminary sales analysis memorandum that [Timken’s]
representations of its distribution channels, including
channel 1, were consistent with its response and that
[Timken] had reported the customer category and channel
of distribution fields accurately in its sales databases.
Court No. 00-09-00454 Page 20
Commerce simply found “no information on the record that
specifically precludes the transactions in question from
being categorized as sales to large OEMs.”
Def.’s Mem. at 37 (quoting Timken’s App. Tab 10 at 52). The Court,
however, cannot discern what record evidence Commerce is referring
to. In this case, had Timken properly classified the transactions
at issue in its response to Commerce’s questionnaire, it would have
categorized the sales as distribution channel 2 or 3 because the
customers did not buy the units for use in producing large original
equipment. See Timken’s App. Tabs 7 & 15 (proprietary version).
Thus, any information submitted by Timken to correct the mis-
classifications would conflict with the original data supplied by
Timken. In the interest of implementing the overarching principle
of the antidumping statute, that is, to determine dumping margins
as accurately as possible, see Fujian, 25 CIT at ___, 178 F. Supp.
2d at 1322, the Court remands this case to Commerce to further
investigate the claims raised during the administrative proceeding.
Any other finding would render a punitive result in contravention
to Allied Tube, 24 CIT at 1370, 127 F. Supp. 2d at 218.
CONCLUSION
The error committed by Timken is not clerical. This case
could have been avoided had Timken followed the instructions of
Commerce and classified its sales transactions properly.
Court No. 00-09-00454 Page 21
Nonetheless, the Court must consider the overarching principle of
the antidumping statute in rendering a decision on this issue. It
is undisputed that Commerce’s goal in administrative reviews is to
determine antidumping margins “as accurately as possible.” Rhone
Poulenc, 899 F.2d at 1191. In this case, an erroneous dumping
margin was calculated as a result of a few misclassified
transactions reported by Timken. These errors were identified upon
publication of the Preliminary Results, and Commerce was provided
with supporting documentation. Since the Court finds the facts of
this case to be distinct from prior case law, the Court remands
this case to Commerce for further investigation and to make any
corrections necessary to attain the most accurate antidumping
margin.
/s/ Nicholas Tsoucalas
NICHOLAS TSOUCALAS
SENIOR JUDGE
Dated: March 5, 2004
New York, New York