Slip Op. 00-157
UNITED STATES COURT OF INTERNATIONAL TRADE
BEFORE: SENIOR JUDGE NICHOLAS TSOUCALAS
_____________________________________
:
TRANSCOM, Inc., :
:
Plaintiff, :
:
L & S BEARING COMPANY, :
:
Plaintiff-Intervenor, :
:
v. : Court No. 97-02-00249
:
THE UNITED STATES, :
:
Defendant, :
:
THE TIMKEN COMPANY, :
:
Defendant-Intervenor. :
_____________________________________ :
Plaintiff Transcom, Inc. (“Transcom”) moves pursuant to USCIT
R. 56.2 for judgment upon the agency record challenging various
aspects of the United States Department of Commerce, International
Trade Administration’s (“Commerce”) final determination, entitled
Final Results and Partial Termination of Antidumping Duty
Administrative Review on Tapered Roller Bearings and Parts Thereof,
Finished and Unfinished, From the People’s Republic of China
(“Final Results”), 62 Fed. Reg. 6173 (Feb. 11, 1997). Transcom
alleges that Commerce unlawfully subjected merchandise imported by
Transcom through exporters not properly designated in Commerce’s
notice of initiation of an antidumping review to certain
determinations Commerce made as a result of the review.
Held: Transom’s USCIT R. 56.2 motion is granted. This case is
remanded to Commerce to liquidate Transcom’s relevant entries at a
rate equal to the cash deposit required on the merchandise at the
time of entry pursuant to 19 C.F.R. § 353.22(e) (1995).
[Transcom’s motion is granted. Case remanded].
Court No. 97-02-00249 Page 2
Dated: November 22, 2000
Neville, Peterson & Williams (George W. Thompson, John M.
Peterson and Curtis W. Knauss) for plaintiff.
Cohen Darnell & Cohen, P.L.L.C. (Mark A. Cohen) for plaintiff-
intervenor.1
David W. Ogden, Assistant Attorney General; David M. Cohen,
Director, Commercial Litigation Branch, Civil Division, United
States Department of Justice (Henry R. Felix); of counsel: Mildred
E. Steward, 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.,
Amy S. Dwyer, Geert De Prest and Mara M. Burr) for defendant-
intervenor.
OPINION
TSOUCALAS, Senior Judge: Plaintiff Transcom, Inc.
(“Transcom”) moves pursuant to USCIT R. 56.2 for judgment upon the
agency record challenging various aspects of the United States
Department of Commerce, International Trade Administration’s
(“Commerce”) final determination, entitled Final Results and
Partial Termination of Antidumping Duty Administrative Review on
Tapered Roller Bearings and Parts Thereof, Finished and Unfinished,
From the People’s Republic of China (“Final Results”), 62 Fed. Reg.
6173 (Feb. 11, 1997). Transcom alleges that Commerce unlawfully
subjected merchandise imported by Transcom through exporters not
1
L & S Bearing Company has intervened in this action but did
not file a motion for judgment upon the agency record and
supporting brief.
Court No. 97-02-00249 Page 3
properly designated in Commerce’s notice of initiation of an
antidumping review to certain determinations Commerce made as a
result of the review.
BACKGROUND
This case concerns the eighth administrative review of the
antidumping duty order on tapered roller bearings (“TRBs”) and
parts thereof, finished and unfinished, imported from the People’s
Republic of China (“PRC”) during the period of review (“POR”)
covering June 1, 1994, through May 31, 1995. Commerce reviewed and
published the preliminary results on August 5, 1996. See
Preliminary Results of Antidumping Administrative Review and Intent
To Revoke Antidumping Duty Order in Part on Tapered Roller Bearings
and Parts Thereof, Finished and Unfinished, From the People's
Republic of China (“Preliminary Results”), 61 Fed. Reg. 40,610. On
February 11, 1997, Commerce published the Final Results. See 62
Fed. Reg. 6173.
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 Jan. 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
Court No. 97-02-00249 Page 4
amendments)).
JURISDICTION
The Court has jurisdiction over this matter pursuant to 19
U.S.C. § 1516a(a)(2) (1994) and 28 U.S.C. § 1581(c) (1994).
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 America v. United States, 24 CIT ___, ___, 104 F. Supp. 2d
110, 115-16 (2000) (detailing Court’s standard of review for
antidumping proceedings).
DISCUSSION
I. Insufficient Notice
A. Background
This case concerns Commerce’s procedure for conducting an
administrative review and imposing antidumping duties. The
procedure involves four steps: (1) Commerce publishes a notice of
Opportunity to Request an Administrative Review for the POR at
issue; (2) upon receipt of such request, Commerce publishes a
notice of Initiation of an Administrative Review in the Federal
Court No. 97-02-00249 Page 5
Register; (3) Commerce, in order to obtain pertinent information,
distributes or makes available questionnaires to those entities
Commerce designated in the notice of Initiation; and (4) on the
basis of the information gathered, Commerce determines the
antidumping duty rates applicable to each entry or type of entries
and publishes these determinations in the Federal Register. See
generally, 19 U.S.C. § 1675(a)(1994); 19 C.F.R. §§ 353.22, 353.31
(1995). If after the publication of a notice of Opportunity to
Request an Administrative Review for the POR at issue, Commerce
does not receive a timely or proper request for review, Commerce
must “without additional notice . . . assess antidumping duties on
the merchandise . . . at rates equal to the cash deposit of . . .
estimated antidumping duties required on that merchandise at the
time of entry . . . .” 19 C.F.R. § 353.22(e).
In this case, Commerce issued the antidumping duty order on
May 27, 1987, and amended the order on February 26, 1990. See
Final Determination of Sales at Less Than Fair Value on Tapered
Roller Bearings From the People's Republic of China, 52 Fed. Reg.
19,748; Amendment to Final Determination of Sales at Less Than Fair
Value and Antidumping Duty Order in Accordance With Decision Upon
Remand on Tapered Roller Bearings From the People's Republic of
China, 55 Fed. Reg. 6669.
On June 6, 1995, Commerce published in the Federal Register a
Court No. 97-02-00249 Page 6
notice of Opportunity to Request an Administrative Review of the
order covering the POR from June 1, 1994, through May 31, 1995.
See Opportunity to Request Administrative Review of Antidumping or
Countervailing Duty Order, Finding, or Suspended Investigation, 60
Fed. Reg. 29,821. In response, The Timken Company (“Timken”), a
United States producer of the subject merchandise, filed a request
for review identifying by name 132 Chinese producers and exporters
and nine Hong Kong exporters of the subject merchandise. See
Def.’s Mem. Opp’n Pl.’s Mot. J. Agency R. (“Def.’s Mem.”) at 4-5
(citing to P.D. 3; Fi. 3, Fr. 1, 3-13). Timken’s list of 132
Chinese and nine Hong Kong entities did not include Direct Source
International and Goldhill International Trading & Services Co.
(collectively “Transcom’s Hong Kong exporters”), entities that were
Hong Kong nationals exporting TRBs from the PRC for Transcom, a
United States importer. See id. at 8. Timken also requested a
review of: (a) “all merchandise covered by the [antidumping duty]
order, from whatever source”; and (b) merchandise from “any other
exporter from Hong Kong or any other third country, . . . any other
exporters or producers, wherever located, [that were] presently or
previously part of or includ[ed] within their names ‘China National
Machinery Import and Export Corporation’ or . . . ‘Machinery Import
and Export Corporation.’” See id. at 4-5.
On August 16, 1995, Commerce initiated the administrative
Court No. 97-02-00249 Page 7
review at issue by publishing a notice of Initiation. See
Initiation of Antidumping and Countervailing Duty Administrative
Reviews and Requests for Revocation in Part (“Notice of
Initiation”), 60 Fed. Reg. 42,500.2 The Notice of Initiation
listed by name the 132 Chinese producers and exporters and nine
Hong Kong exporters identified in Timken’s request for review and,
right at the outset, expressly provided that Commerce was “not
initiating an administrative review of any exporters and/or
producers who were not named in [the] review request [submitted by
Timken] because such exporters and/or producers were not specified
as required . . . .” Id. at 42,500-01 (emphasis supplied).
Simultaneously, the Notice of Initiation provided that “[a]ll
exporters of TRBs from the People’s Republic of China [were]
conditionally covered by this review.” Id. at 42,503 (emphasis
supplied).
This combination of statements was a notable deviation from
the language Commerce used in the notice of Initiation of the
review immediately preceding the one at issue. In the notice of
Initiation of the preceding review, Commerce stated, in a similar
2
The regulation states that Commerce must publish “notice of
‘Initiation of Antidumping Duty Administrative Review.’” 19 C.F.R.
§ 353.22(c)(1) (pattern of capitalization in original).
Accordingly, any such notice is designated in this opinion as
“notice of Initiation” except for the notice of Initiation at issue
which is designated as Notice of Initiation.
Court No. 97-02-00249 Page 8
fashion, that “[a]ll other exporters of tapered roller bearings
[were] conditionally covered.” Initiation of Antidumping Duty
Administrative Reviews and Request for Revocation in Part, 59 Fed.
Reg. 43,537, 43,539 (Aug. 24, 1994). The preceding notice of
Initiation, however, was silent about whether Commerce intended to
review the entries from any exporters and/or producers not named in
the request for review. The language indicating Commerce’s intent
to abstain from reviewing the entries from any exporters/producers
unidentified or improperly identified in the request for review
appeared for the first time in the Notice of Initiation at issue.
See Notice of Initiation, 60 Fed. Reg. at 42,500-01.
After publication of the Notice of Initiation, Commerce
distributed questionnaires to the respondents named in the Notice
of Initiation. See Preliminary Results, 61 Fed. Reg. at 40,610.
Commerce also made the questionnaires available for those parties
that were not identified by name in the Notice of Initiation but
who wished to submit required information in order to prevent a
possible negative default determination. See id.; cf. Preliminary
Results of Antidumping Administrative Review on Tapered Roller
Bearings and Parts Thereof, Finished and Unfinished, From the
People’s Republic of China, 60 Fed. Reg. 49,572, 49,573-76 (Sept.
26, 1995) (discussing the case of Xiangfan International Trade
Corp.); Transcom v. United States (“Transcom CIT”), 24 CIT ___,
Court No. 97-02-00249 Page 9
___, Slip op. 00-146 at 12, 31 (Nov. 7, 2000).
Unaware of the existence of Transcom’s Hong Kong exporters,
Commerce did not provide them with the questionnaires, and
Transcom’s Hong Kong exporters and their PRC suppliers did not
submit the questionnaires on their own. See Def.’s Mem. at 8;
Pl.’s Br. Supp. Mot. J. Agency R. (“Pl.’s Br.”) at 7.
After the period to submit the questionnaires expired,
Commerce reviewed the information it had obtained and published the
Preliminary Results. See 61 Fed. Reg. 40,610. The Preliminary
Results released the rates allocated to the entries from the
entities that provided Commerce with the information meriting the
assignment of separate rates. See id. at 40,611-12. The
Preliminary Results also indicated that those companies that did
not respond to the questionnaires or responded in an insufficient
way would not merit separate rates and, thus, would be subject to
the default PRC rate. See id. at 40,613-14.
On August 23, 1996, Transcom entered its notice of appearance,
arguing that Commerce’s application of the default PRC rate was
invalid with respect to the entries of those entities that
abstained from responding to the questionnaires because they were
not properly designated in the Notice of Initiation and, thus, not
notified of the pending review. See Final Results, 62 Fed. Reg.
Court No. 97-02-00249 Page 10
6186-87; Def.’s Mem. at 8 (citing to P.D. 166, Fi. 46, Fr. 53).
In the Final Results, Commerce refuted Transcom’s argument and
indicated that Transcom’s entries from its Hong Kong exporters
would be subject to the review and the PRC default rate. See 62
Fed. Reg. at 6187-88. Consequently, Transcom initiated the current
proceedings and filed a brief before this Court identifying its
Hong Kong exporters by name. See Def.’s Mem. at 8.
B. Contentions of the Parties
Transcom contends that under 19 U.S.C. § 1675(a) and 19
C.F.R. § 353.22, Commerce lacked authority to review and impose the
resulting determinations upon entries of any entities other than
those properly designated in the Notice of Initiation. See Pl.’s
Br. at 13-20. Specifically, Transcom asserts that the language of
19 U.S.C. § 1675(a) and 19 C.F.R. § 353.22, as interpreted by case
law and read in conjunction with Commerce’s express statement that
Commerce was “not initiating an administrative review of any
exporters and/or producers who were not [properly] named in [the]
review request,” precludes Commerce from reviewing and imposing the
default PRC rate upon the entries of entities other than those
properly designated in Timken’s request for review. See id.
Commerce argues that it was obligated to provide notice only
to “respondents” determinable under the “first to know test,” here,
Court No. 97-02-00249 Page 11
the PRC suppliers to Transcom’s Hong Kong exporters. See Def.’s
Mem. at 15-21. Alternatively, Commerce maintains that it provided
Transcom and its Hong Kong exporters with constructive notice by
including the statement that “[a]ll exporters of TRBs from the
People’s Republic of China [were] conditionally covered by this
review” in the Notice of Initiation. See id. at 48.
Timken agrees with Commerce that Transcom’s entries were
subject to the determinations Commerce made in its Final Results
because the statement “[a]ll exporters of TRBs from the People’s
Republic of China are conditionally covered by this review”
provided Transcom and its Hong Kong exporters with constructive
notice of the pending review. See Timken’s Resp. Opp’n Pl.’s Mot.
J. Agency R. (“Timken’s Resp.”) at 12-14. In addition, Timken
alleges that Transcom’s challenge to the Preliminary Results
indicates Transcom’s awareness of the fact that its entries were
subject to the review and constitutes Transcom’s de facto admission
of being on notice. See id. at 14.
C. Analysis
1. Commerce’s Obligation to Notify
Commerce argues that under the “first to know test,” Commerce
was obligated to notify only the PRC suppliers to Transcom’s Hong
Kong exporters. See Def.’s Mem. at 15-21. The Court addressed
Court No. 97-02-00249 Page 12
this issue in Transcom CIT and held that Commerce’s assertion was
contrary to the applicable statute, regulation and case law.3 See
24 CIT ___, ___, Slip op. 00-146 at 18-21 (relying on 19 U.S.C. §
1675(a); 19 C.F.R. § 353.22(c) (1994); Chevron U.S.A. Inc. v.
Natural Resources Defense Council, Inc., 467 U.S. 837 (1984) ;
Transcom, Inc. v. United States (“Transcom CAFC”), 182 F.3d 876
(Fed. Cir. 1999)). Since the issue and the arguments presented in
the instant case are identical to those in Transcom CIT, the Court
adheres to its reasoning in Transcom CIT. Accordingly, the Court
finds that Commerce was obligated to adequately notify all parties
whose interests could be affected by the administrative review.
See Transcom CAFC, 182 F.3d at 882-84; Transcom CIT, 24 CIT ___,
___, Slip op. 00-146 at 18-21.
2. Insufficiency of Notice Ensuing From the Language
of the Notice of Initiation
A request for an administrative review must be submitted by an
interested party. See 19 C.F.R. § 353.22(a). The term “interested
party” includes “[a] producer in the United States of the like
product . . . .” 19 C.F.R. § 353.2(k)(3) (1995). In the instant
case, Timken is the interested party. Timken’s request for the
administrative review: (a) catalogued the names of 132 Chinese
3
Although Transcom CIT was a pre-URAA case and the instant
case is post-URAA, the outcome does not change as a result of the
amendments.
Court No. 97-02-00249 Page 13
producers and exporters and nine Hong Kong exporters; (b)
identified a somewhat amorphous class of “other exporters or
producers, wherever located, [that were] presently or previously
part of or includ[ed] within their names ‘China National Machinery
Import and Export Corporation’ or . . . ‘Machinery Import and
Export Corporation’”; and (c) designated a general category of
those entities whose entries were “merchandise covered by the
order, from whatever source.” See Def. Br. at 4-5 (citing P.D. 3;
Fi. 3; Fr. 1-13).
The interested party, however, may request an administrative
review of only “specified individual producers or resellers . . .
.” 19 C.F.R. § 353.22(a) (emphasis supplied). The phrase
“specified individual producers or resellers” is interpreted by
case law to mean that, in making a request for a review, the
interested party should exhaust all avenues reasonably available in
its attempts to specifically identify the entities to be reviewed
before designating a general category of entities. See 19 C.F.R.
§ 353.22(a); Floral Trade Council v. United States, 17 CIT 1417,
1418 (1993). There is no evidence showing that Timken exhausted
all avenues reasonably available to it. Consequently, Timken’s
identification of those entities whose entries were “merchandise
covered by the order, from whatever source” was an invalid
designation of a general category. See Floral Trade Council, 17
Court No. 97-02-00249 Page 14
CIT at 1417, 1419 (holding that an interested party could not
request a review of the entire Columbian industry, leaving to
Commerce the task of gathering the names of all relevant producers
and exporters). The language of Timken’s request had to be read
without this invalid designation. See 19 C.F.R. § 353.22(a);
accord Notice of Initiation, 60 Fed. Reg. at 42,500-01. It follows
that Commerce, as long as it was proceeding upon Timken’s request,
had the authority to review either the 132 Chinese
producers/exporters and nine Hong Kong exporters listed by Timken
(collectively “132 and nine companies”) or, possibly, the 132 and
nine companies plus all “other exporters or producers, wherever
located, [that were] presently or previously part of or includ[ed]
within their names ‘China National Machinery Import and Export
Corporation’ or . . . ‘Machinery Import and Export Corporation’”
(collectively “132 and nine companies plus a certain class”).4
4
A requesting interested party “must bear the . . . burden
imposed on it by the regulation to name names” of the entities to
be reviewed. Floral Trade Council, 17 CIT at 1418-19. However,
“the burdens on the requester are those caused by the mechanics of
triggering the review that is actually desired. In practical
terms, these burdens should be minimal.” Id. at 1418. In other
words, a requesting interested party could probably satisfy its
burden to “name names” by providing an encompassing term
specifically identifying a precise and limited class, so the
designation would be more analogous to “naming names” than to
vaguely outlining a general category of entities. See 19 C.F.R. §
353.22(a); Floral Trade Council, 17 CIT at 1418-19. The Court,
however, does not need to reach this issue in the instant case
because, as it is discussed below, the outcome remains the same
regardless of whether or not Timken validly requested the review of
(continued...)
Court No. 97-02-00249 Page 15
Commerce must designate in its notice of Initiation those
entities whose interest in entries of merchandise might be affected
by the review in order to subject these entries to Commerce’s
determinations. See generally, 19 C.F.R. §§ 353.22(a), 353.29(a)
(1995). The designation in a notice of Initiation provides these
entities with notice of pending review and enables them to
participate meaningfully. See 19 U.S.C. § 1675(a); 19 C.F.R. §
353.22(a); Mullane v. Central Hanover Bank & Trust Co., 339 U.S.
306 (1950); Transcom CAFC, 182 F.3d at 881-84; Transcom CIT, 24 CIT
___, ___, Slip op. 00-146 at 24-25. Commerce’s failure to provide
adequate notice is a violation of Commerce's statutory and
regulatory obligations that makes the resulting determinations
procedurally defective and inoperative with regard to the entries
of those entities that did not receive adequate notice. See
Transcom CAFC, 182 F.3d at 880, 884; see generally, Mullane, 339
U.S. 306. In the instant case, as discussed below, the scope-
limiting statement that Commerce was “not initiating an
administrative review of any exporters and/or producers who were
not [properly] named in [the] review request” submitted by Timken
superceded the scope-enlarging statement that “[a]ll exporters of
4
(...continued)
“other exporters or producers, wherever located, [that were]
presently or previously part of or includ[ed] within their names
‘China National Machinery Import and Export Corporation’ or . . .
‘Machinery Import and Export Corporation.’”
Court No. 97-02-00249 Page 16
TRBs from the People’s Republic of China [were] conditionally
covered.” The scope-limiting statement stripped Transcom of its
right to notice of the review, thus, making the determinations in
the Final Results inoperative with regard to Transcom’s entries
from its Hong Kong exporters.
If Commerce reviews entries of merchandise from a non-market
economy, it can satisfy the notice requirement by designating the
entities in a notice of Initiation either by name or by a defining
phrase that is “reasonably calculated, under all the circumstances,
to apprize interested parties of the pendency of the action and
afford them an opportunity to present their objections.” Mullane,
339 U.S. at 314 (citations omitted); see Transcom CAFC, 182 F.3d at
881-82; Transcom CIT, 24 CIT ___, ___, Slip op. 00-146 at 23-32.
The phrase “[a]ll exporters of TRBs from the People’s Republic of
China [were] conditionally covered by this review,” included in the
Notice of Initiation, was a defining phrase that, under the
circumstances, satisfied the notice requirement by reasonably
alerting the entities to the pendency of the review. See Transcom
CAFC, 182 F.3d at 881-82; Transcom CIT, 24 CIT ___, ___, Slip op.
00-146 at 23-32. The phrase implies that the scope of the review
could be enlarged to encompass any entity that Commerce itself
could make subject to the review in addition to the entities
properly designated in the request for review by the interested
Court No. 97-02-00249 Page 17
party. See generally, Transcom CAFC, 182 F.3d at 880, 883;
Transcom CIT, 24 CIT ___, ___, Slip op. 00-146 at 21-23; Def.’s
Mem. at 48.
The Notice of Initiation also included a scope-limiting
statement that Commerce was “not initiating an administrative
review of any exporters and/or producers who were not [properly]
named in [the] review request” by Timken. Notice of Initiation, 60
Fed. Reg. at 42,500-01. Two alternative meanings could have been
inferred from this statement: (1) Commerce expressly limited its
right of review to only the “132 and nine companies”; or (2)
Commerce expressly limited its right of review to only the “132 and
nine companies plus a certain class.” In sum, the scope-limiting
statement that Commerce was “not initiating an administrative
review of any exporters and/or producers who were not named in
[the] review request” by Timken potentially conflicted with the
implied meaning of Commerce’s scope-enlarging statement that
“[a]ll exporters of TRBs from the People’s Republic of China
[were] conditionally covered by this review.” Id. at 42,500-01,
42,503.
While the particular circumstances of this case might allow an
Court No. 97-02-00249 Page 18
interpretation harmonizing these incompatible statements,5 the
outcome remains the same: the notice provided by Commerce was
procedurally insufficient with regard to Transcom’s entries from
its Hong Kong exporters.
The Court believes that Commerce’s statement that “[a]ll
exporters of TRBs from the People’s Republic of China are
conditionally covered” signified Commerce’s desire to enlarge the
scope of the review to encompass entities other than those properly
5
It can be fancied that the reason for Commerce’s statement
that “[a]ll exporters of TRBs from the People’s Republic of China
[were] conditionally covered” was not a desire to enlarge the scope
of the review to encompass the entities other than those properly
designated in Timken’s request but rather a desire to validate
Timken’s usage of the questionable encompassing term “exporters or
producers, . . . [that were] presently or previously part of or
includ[ed] within their names ‘China National Machinery Import and
Export Corporation’ or . . . ‘Machinery Import and Export
Corporation.’” Such interpretation allows a harmonized reading of
the statements that: (1) Commerce was “not initiating an
administrative review of any exporters and/or producers who were
not named in [the] review request” and (2) Commerce deemed “[a]ll
exporters of TRBs from the People’s Republic of China [to be]
conditionally covered” by the review. In that case, the scope-
limiting statement that Commerce was “not initiating an
administrative review of any exporters and/or producers who were
not named in [the] review request” narrows the scope of the review
to the “132 and nine companies plus a certain class.” Granting
that, the entries from Transcom’s Hong Kong exporters would be
excluded from the scope of the review because Transcom’s Hong Kong
exporters were neither listed among the “132 and nine companies”
nor presently or previously part of or included within their names
the term “China National Machinery Import and Export Corporation”
or “Machinery Import and Export Corporation.” Thus, under this
interpretation, the aggregated language of the Notice of Initiation
could not amount to adequate notice that Transcom’s entries from
its Hong Kong exporters were subject to the review. See Transcom
CAFC, 182 F.3d at 883-84.
Court No. 97-02-00249 Page 19
designated in Timken’s request, that is, entities neither on the
list of “132 and nine companies” nor on “132 and nine companies
plus a certain class.” See Transcom CAFC, 182 F.3d at 882;
Transcom CIT, 24 CIT ___, ___, Slip op. 00-146 at 24, 31-32; Def.’s
Mem. at 48. This scope-enlarging statement, therefore, was in
conflict with Commerce’s scope-limiting statement that Commerce was
“not initiating an administrative review of any exporters and/or
producers who were not [properly] named in [the] review request”
submitted by Timken.
Between two incompatible agency statements, as with
conflicting statutory authorities, the more specific one must
prevail. Cf. Smith v. Berry Co., 198 F.3d 150, 152 (5th Cir. 1999)
(holding that among two conflicting statutes, the more specific
statute prevails over the more general one); see Kinney v.
Yerusalim, 812 F. Supp. 547, 550 (E.D. Penn. 1993) (finding that
the more specific agency regulation supersedes the more general
provision). The degrees of specificity of the two statements at
issue are different. The statement that Commerce was “not
initiating an administrative review of any exporters and/or
producers who were not [properly] named in [the] review request”
was a narrowly-tailored concrete declaration. It provided that any
party not included on the list of “132 and nine companies” (or “132
and nine companies plus a certain class”) had no reason to be
Court No. 97-02-00249 Page 20
concerned about the outcome of the review. Considering the
ambiguities inherently associated with descriptive language, one
can hardly make a statement more specific than a list of names.6
See e.g., Ayala v. United States, 980 F.2d 1342, 1344 (10th Cir.
1992); Issner v. Aldrich, 254 F. Supp. 696 (D. De. 1966); cf. S.
REP. No. 95-1071 (1978), reprinted in 1978 U.S.C.C.A.N. 2676, 2705
(noting that a list of names amounts to a precise statement). By
the same token, when Commerce expressly omitted Transcom’s Hong
Kong exporters in its list of “132 and nine companies” (or “132 and
nine companies plus a certain class”), it could hardly make a more
precise statement.
Conversely, Commerce’s descriptive statement that “[a]ll
exporters of TRBs from the People’s Republic of China [were]
conditionally covered” was intended to be a general, broader
statement subjecting the entries from indefinite entities Commerce
6
Assuming that Timken’s request for review was only valid
with regard to “132 and nine companies,” the list of these very
same entities was actually spelled out in the Notice of Initiation
and constituted a specific statement. See 60 Fed. Reg. 42,501-03.
The effect would be the same if Commerce’s review encompassed “132
and nine companies plus a certain class.” The mere fact that the
terms “China National Machinery Import and Export Corporation” or
“Machinery Import and Export Corporation” provided by Timken were
not recited in the Notice of Initiation changed nothing: the
content of Timken’s review request, a public document, was
available and known to any entity in the industry and could have
been read into the Notice of Initiation through Commerce’s
statement that “[a]ll exporters of TRBs from the People’s Republic
of China are conditionally covered”. See Def.’s Mem. at 4, n.3;
see also supra note 5.
Court No. 97-02-00249 Page 21
was unable to designate specifically to the scope of the review.7
See Def.’s Mem. at 48; Timken’s Resp. at 10-11; Transcom CAFC, 182
F.3d 882-83; Transcom CIT, 24 CIT ___, ___, Slip op. 00-146 at 31
(citing to Def.’s Mem. Opp’n Pl.’s Mot. J. Agency R. at 43,
Transcom CIT, 24 CIT ___, ___, Slip op. 00-146).
Consequently, the statement that Commerce was “not initiating
an administrative review of any exporters and/or producers who were
not [properly] named in [the] review request” was a more specific
declaration than the statement that “[a]ll exporters of TRBs from
the People’s Republic of China [were] conditionally covered.” The
former statement controlled the latter one and justified Transcom’s
reasonable reliance. See Kinney, 812 F. Supp. at 550.
Furthermore, the sum of the conflicting statements constituted
a notable deviation from the language Commerce used in its previous
notices. Except for the notice of Initiation directly preceding
that at issue, all of Commerce’s previous notices of Initiation did
not include any language either enlarging or limiting the scope of
relevant reviews. See Transcom CAFC, 182 F.3d at 882. The notice
7
“Definitions necessarily are imprecise and ambiguous because
they attempt to represent complex concepts and myriad factual
scenarios using the imprecise medium of language. Imprecision and
ambiguity are particularly common when . . . the concept underlying
the definition is both non-observable and qualitative in nature.”
Kevin H. Smith, Disabilities, Law Schools, and Law Students: A
Proactive and Holistic Approach, 32 AKRON L. REV. 1, 38 (1999).
Court No. 97-02-00249 Page 22
of Initiation directly preceding that at issue included no scope-
limiting language, it only provided that “[a]ll other exporters of
tapered roller bearings [were] conditionally covered . . . .”
Initiation of Antidumping Duty Administrative Reviews and Request
for Revocation in Part, 59 Fed. Reg. at 43,539. This statement was
apparently included by Commerce to alert the industry to an
enlargement of the scope of Commerce’s review. See Transcom CIT,
24 CIT ___, ___, Slip op. 00-146 at 27-29.
It was reasonable for a member of regulated industry such as
Transcom to assume that the inclusion of the new, scope-limiting
language into the Notice of Initiation at issue manifested
Commerce’s intent to amend Commerce’s prior policy, curtail the
scope of the pending review and alert the industry accordingly.
Cf. Chevron, 467 U.S. at 845 (explaining that an agency may choose
to reconcile and foster inconsistent goals and policies).
Agency statements provide guidance to regulated industries.
There is, however, a distinct difference between the measure of
guidance (and the ensuing industry responsibilities) created by a
narrowly paraphrased unambiguous statement and the measure of
guidance provided by a statement that is broad, general and
descriptive. An industry member is expected to contact its
regulating agency and inquire if the industry member finds a
general descriptive term ambiguous and in need of clarification.
Court No. 97-02-00249 Page 23
See Transcom CIT, 24 CIT ___, ___, Slip op. 00-146 at 26-31. An
inquiry, however, is not expected if the statement the agency makes
is a precise pronunciation based on statutes, regulations and case
law. Indeed, it would be anomalous to expect a member of the
industry to inquire whether the agency is aware of the applicable
statutes, regulations and pertinent case law, or whether the agency
actually meant to make the unambiguous statement it made. If, in
addition to making an unambigious specific statement, the agency
makes a conflicting general statement, it has nobody to blame but
itself for the resulting confusion. Cf. ITT World Communications,
Inc. v. FCC, 725 F.2d 732, 754 (D.C. Cir. 1984) ("[A]n agency does
not act rationally when it chooses and implements one policy and
decides to consider the merits of a potentially inconsistent policy
in the very near future."); Hamlin v. Hamlin, 192 N.Y. 164, 168
(1908) (holding that a statement in a pronunciation by a tribunal
inconsistent with another statement in the same pronunciation
allows the affected party to rely in good faith upon the statement
more favorable to the party’s contentions).
To summarize, the statement that Commerce was “not initiating
an administrative review of any exporters and/or producers who were
not [properly] named in [the] review request” gave each member of
the industry constructive notice and an implied promise that his
entries would be excluded from the review and liquidated “at rates
Court No. 97-02-00249 Page 24
equal to the cash deposit of . . . estimated antidumping duties
required on that merchandise at the time of entry” under 19 C.F.R.
§ 353.22(e) if the industry member was not properly identified in
Timken’s request. The inclusion of the statement that “[a]ll other
exporters of tapered roller bearings [were] conditionally covered”
created an element of confusion but did not change the message
ensuing from the aggregated language of the Notice of Initiation.
3. De Facto Admission of Being on Notice
Timken alleges that Transcom’s challenge to Commerce’s
Preliminary Results8 indicated that Transcom was aware that its
entries could be subject to the review. See Timken Br. at 14. The
Court disagrees.
According to its own regulation, Commerce must publish its
preliminary results together with an “invitation for argument.”
See 19 C.F.R. § 353.22(c)(5). The invitation for argument allows
“any interested party or U.S. Government agency [to] submit a ‘case
brief’” contesting Commerce’s preliminary results and to “present
in full all arguments that[,] in the submitter's view [, are]
8
Transcom entered its notice of appearance, arguing that
Commerce’s application of the default PRC rate was invalid with
respect to the entries from those entities that abstained from
responding to the questionnaires because they were not properly
designated in the Notice of Initiation and, thus, not notified of
the pending review. See Final Results, 62 Fed. Reg. 6186-87.
Court No. 97-02-00249 Page 25
relevant to [Commerce’s] final determination or final results . .
. .” 19 C.F.R. § 353.38(c)(1),(2) (1995) (emphasis supplied);
accord Preliminary Results, 61 Fed. Reg. at 40,615. Nothing in the
language of 19 C.F.R. § 353.38(c) requires the “interested party”
to be an entity negatively affected by Commerce’s final
determinations. See generally, 19 C.F.R. § 353.38(c). Moreover,
Commerce’s own definition of “interested party” does not include
the requirement. See 19 C.F.R. 353.2(k).9 Timken’s interpretation
adds an element not contemplated by Commerce to the language of 19
C.F.R. §§ 353.2(k), 353.38(c) and effectively substitutes
Commerce’s definitions with the implausible criterion based upon an
entity’s predictions about negative determinations Commerce could
make in the future.
9
According to Commerce’s definition, the term
[i]nterested party means: (1) [a] producer,
exporter, or United States importer of the
merchandise, or a trade or business association a
majority of the members of which are importers of
the merchandise; (2) [t]he government of the home
market country; (3) [a] producer in the United
States of the like product or seller (other than a
retailer) in the United States of the like product
produced in the United States; (4) [a] certified or
recognized union or group of workers which is
representative of the industry or of sellers (other
than retailers) in the United States of the like
product produced in the United States; (5) [a]
trade or business association a majority of the
members of which are producers in the United States
of the like product or sellers (other than
retailers) in the United States of the like product
produced in the United States . . . .
19 C.F.R. § 353.2(k).
Court No. 97-02-00249 Page 26
In addition, the inference of notice from the mere fact of an
entity’s comments to Commerce’s preliminary results would have two
undesirable effects: (1) it would defeat the goal of 19 C.F.R. §
353.38(c) that aims to encourage public participation in
administrative process rather than to penalize participants; and
(2) it would circumvent the notice requirements of 19 U.S.C. §
1675(a) and 19 C.F.R. § 353.22(c), both of which provide that a
notice must be given at the outset of a review rather than inferred
post factum from the entity’s eventual comments.
An entity’s good faith submission of a comment to Commerce’s
preliminary results made upon Commerce’s own invitation should
neither be interpreted as the entity’s concession of being a party
adversely affected by the determinations nor as an affirmation of
being properly on notice. Holding otherwise would be as anomalous
as stating that an amicus curiae admits being a properly served
defendant if he files a brief with the leave of court.
II. Other Contentions
Other issues disputed by Transcom and Commerce include: (a)
Commerce’s right to subject Transcom’s entries to the “best
information available” (“BIA”) rate resulting from the failure of
Transcom’s Hong Kong exporters to submit the information sought in
Commerce’s questionnaires; and (b) a violation of Transcom’s Fifth
Court No. 97-02-00249 Page 27
Amendment procedural Due Process rights resulting from Commerce’s
insufficient notice. See Pl.’s Br. at 28-37; Def.’s Mem. at 52-57.
None of these issues, however, needs to be reached by the
Court because Commerce’s notice failed the threshold issue of
procedural sufficiency. Commerce, therefore, is barred from the
imposition of the determinations made in the Final Results upon the
entries from Transcom’s Hong Kong exporters and from the
application of the default BIA rate to these entries. See Transcom
CAFC, 182 F.3d at 880-81 (stating that (a) “it would be
inappropriate for the government to ‘resort[ ] to BIA for companies
which were not specifically listed in the [N]otice of [I]nitiation
and not issued their own questionnaires,’ since those parties would
have had ‘no actual or constructive notice’”; and (b) the court
“need not address Transcom's argument that the lack of notice of
the scope of the administrative reviews violated Transcom's rights
under the due process clause of the Fifth Amendment to the
Constitution, because . . . Commerce's conduct . . . violated
Commerce's statutory and regulatory notice obligations in
connection with the administrative reviews.”)
CONCLUSION
For the foregoing reasons, the Court finds the notice provided
by Commerce in the Notice of Initiation procedurally deficient with
regard to Transcom’s entries from its Hong Kong exporters. This
case is remanded to Commerce to liquidate Transcom’s relevant
entries at a rate equal to the cash deposit required on the
merchandise at the time of entry pursuant to 19 C.F.R. § 353.22(e).
______________________________
NICHOLAS TSOUCALAS
SENIOR JUDGE
Dated: November 22, 2000
New York, New York