Slip Op. 02-03

UNITED STATES COURT OF INTERNATIONAL TRADE BEFORE: SENIOR JUDGE NICHOLAS TSOUCALAS

___________________________________ : CONSOLIDATED BEARINGS COMPANY, : : Plaintiff, :

: Court No. 98-09-02799 v. :

: THE UNITED STATES, : : Defendant. : ___________________________________:

ORDER The case at bar comes before this Court as a result of the Court’s decision in ConsolidatedBea rings Co. v. United States (“ ConsolidatedBearings ”), 25 CIT ___, 166 F. Supp. 2d 580 (2001), andconcerns the events that followed the issuance of Final Results of Antidumping Duty Administrative Review of Antifriction Bearings (Other Tha n Tapered Roller Bearings) and Parts Thereof From the Federal Republic of Germany , 56 Fed. Reg. 31,692 (July 11, 1991),
as amended by Amended Final Results of Antidumping Duty Administrative Reviews of Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof Fr om Ger many , 62 Fed. Reg. 32 ,755 ( June 17, 1997), by the United States Department of Commerce, International Trade Administration (“Commerce”).Court No. 98-09-02799 Page 2

Spec ific ally, on September 9, 1997, Commerce instructed the UnitedSt ates Customs Service (“Customs”) to liquidate, at a certain “manufacturer’s” rate, entries of the merchandise produced by FAG Kugelfischer Georg Schaefer KGaA (“FAG Kugelfi sche r”) and importedby certain importers, the list of which did not include ConsolidatedBearings Company (“Consolidated Bearings”), an entity that imported the merchandise manufactured by FAG Kugelfischer as well as other merchandise. Almost a year later, on August 4, 1998, Commerce sent liquidation instructions (“Liquidation Instructions”) to Customs requiring Customs to liquidate the merchandise that was: (1) produced in Germany; (2) imported by any importer; and (3) still remained unliquidated after the application of prior liquidation instructions including that of September 9, 199 7, a t the deposit rate required at the time of entry of the merchandise. Under the Liq uida tion Instructions, Customs had to assess Consolidate d B earings’ entries at the rate much higher than the “manufacturer’s” rate determined by Commerce for FAG Kugelfischer. Consequently, ConsolidatedBearings moved pursuant to USCIT R. 56.1 for judgment upon the agency record challenging the Liquidation Instructions issued by Commerce and alleging that the Liquidation Instructio ns w ere arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. The Court grantedConsolidated Bearings’ motion and remanded this case toCourt No. 98-09-02799 Page 3

Commerce to: (a) annul the Liquidation Instructions issued by Commerce on August 4, 1998; and (b) take further actions not inconsistent with this opinion. See Consolidated Bearings , 25 CIT at ___, 166 F. Supp. 2d at 593. The Court particularly explained that the remand was caused by: (1) the insufficiency of Commerce’s explanation about Commerc e’s reasons for the issuance of the Liquidation Instructions, see id. 25 CIT at ___, 166 F. Supp. 2d at 590-92; and ( 2) t he deficiencies of the Liquidation Instructions evincing Commerce’s acknowledgment that Consolidated Bearings’ imports of FAG Kugelfischer’s merchandise could ha ve b een liquidatedpreviously and legitimately under the rates given in the instructions of September 9, 1997.
On November 6, 2001, Commerce filed Final Results of Redetermination Pursuant to C t. Remand (“ Remand Results ”) for ConsolidatedBearings , 25 CIT ___, 166 F. Supp. 2d 580. In the Remand Results , Commerce explains that Commerce: (1) possesses no information on whether Consolidated Be aring s’ purchases of FAG Kugelfischer’s merch andi se were direct, see Remand Results at 3; (2) “surmise[s] . . . that Consolidated [B earing s] purchased the [merchandise] from an intermediate party,” id. at 4; (3) “find[s] it inappropriate to instruct” Customs to liquidate Con s olidated Bearings’ merchandise at FAG Kugelfischer’s rates, id. at 5; and (4) devises two alternative approaches (one of which provides forCourt No. 98-09-02799 Page 4

“three al ternative rates” for different types of Consolidated Bearings’ merchandise) to be used instead of the approach given in the September 9, 1997, liquidation instructions because “the Court didnot specify any alternative rates [Commerce] should consider.” Id. at 3, 6-8.
While the Court appreciates the care and consideration and recognizes the creativity Commerce put into creation of alternative approaches and alternative rates, it is obvious that Commerce misreads the purpose and the scope of the remand. The gist of Consolidated Bearings , 25 CIT ___, 166 F. Supp. 2d580, is that, within parameters of each administrative determination, Commerce is bound to each election Commerce makes. Cf. SKF USA Inc. v. United States , 263 F.3d 1369, 1382 (Fed. Cir. 2001). If Commerce issues liquidation instructions that Commerce contemplates to be applicable to a particular merchandise, Commerce cannot change its mind and enter “corrections” a year later or, as ConsolidatedBearings corr ectly points out, three years later. AccordPl.’s Comments Concerning Final Results of Redetermination Pursuant Ct. Remand at 3. If Commerce does not review a particular respondent but knowingly allows the imports of such respondent to be liquidated at a particular rate, Commerce is equally bound to such election. In this case, Commerce is bound by the SeptemberCourt No. 98-09-02799 Page 5

9, 1997, liquidation instructions. If Commerce is unsatisfied with
a potential application of those instructions, Commerce should have issuedsaid instructions in a clearer manner. Indeed, it would be
anoma lous to suggest that Commerce could “fine tune” its determinations any time Commerce is displeased with the outcome of the application of a document Commerce issued or any time Commerce starts having doubts about the evidence Commerce possesses. Under such a scheme the whole administrative process would not only lose any time frame and due pr oce ss constrains but would effectively become a carte blanche in the hands of an agency. The Court presumes that the reason for Commerce’s misreading of the scope of the re mand is the Court’s instruction to “take f urther actions not inconsistent with [the Court’s] opinion . ” Consolidated Bearings , 25 CIT at ___, 166 F. Supp. 2d at 593. It seems that Commerce read this language as a requirement to devise alternative approaches (or rates) for Consolidated Bearings’ import of FAG Kugelfischer’s merchandise. See Remand Results at 3, 6.
Commerce is in error. Under the language of the September 9, 1997, liquidation instructions and Commerce’s actions within a year after the issuance of these instructions, all Consolidated Bearings’ impo rts of FAG Kugelfischer’s merchandise during the per iod of review should be liquidated in accordance with theCourt No. 98-09-02799 Page 6

1 Indeed, such a supposition seems unlikely. Comm erce, however, stated that alternative readings of the September 9, 1997, liquidati on instructions were plausible. See Consolidated Bearings , 25 CIT at ___, 166 F. Supp. 2d at 592. While t h e possibility of alternative readings could serve as a basis for a vagueness attack by Consolidated Bearings’, no such claim was entered by the plaintiff. September 9, 1997, liquidation instructio ns o nly. Courts omit spelling out the particular technical actions to be taken by an agency because courts are in pr ivy w ith only a limited amount of
e vide nce and, thus, are unfamiliar with particularities of the transactions under review.
For example, if the language of the September 9, 1997, liquidation instructions allows: (1) different modes of liquidation; and (2) such different modes were actually utilized by Customs right after Customs’ receipt of the September 9, 1997, liquidation instructions with regard to parties other than ConsolidatedBearings, Commerce could have instructed Cust oms to choose among these modes of liquidation. 1 Alternatively, because “Consolidated[] [Bearings’] entries were not reviewed” during the review at issue, and Commerce “do[es] not have any information about the kinds of [me rchandise] Consolidated [Bearings] entered during the period,” Remand Results at 5, Comme rce could instruct Cu stom s to liquidate Consolidated Bearings’ import of FAG Kuge lfisc her’s merchandise in accordance with the September 9,Court No. 98-09-02799 Page 7

2 Any liquidation of Consolidated Bearings’ merchandise without prior proper determination by Commerce would be a violation of administrative process and Consolidated Bearings’ procedural due process rights. 1997, liquidation instructions, while ordering the liquidation of all other Consolidated Bearings’ merchandise under another applicable determination which Commerce believes is applicable (providedsuch other determination was duly rendered 2 an d it was feasible for Commerce to devise a methodology of separating ConsolidatedBearings’ imports of FAG Kugelfischer’s merchandise andother Consolidated Bearings’ imports during the period of review). If in such a case, as unlikely as it may be, the identity of the merchandise manufacturer wou ld bec ome an issue, the Court couldentertain Commerce’s reasonable methodology determining which ConsolidatedBearings’ imports are of FAG Kugelfischer’s merchan dise and which are not. Bearing in mind that it w a s Commerce and not the Court that was charged with a duty to familiarize itself with all the particular circumstances of the transaction and apply the law, the Court issued Commerce a legal, rather than technical, mandate in Consolidated Bearings , 25 CIT ___, 166 F. Supp. 2d 580. However, because Commerce neithe r to ok nor suggested taking any further actions with regard to Consolidated Bearings’ imports of FAG Kugelfischer’s merchandise that would abide with Commerce’sCourt No. 99-08-00462 Page 8

September 9, 1997, liquidation instructions, it is hereby
ORDERED that the Remand Results filed by Commerce on November 6, 2001, are vacated; and it is further
ORDERED that t his case is remanded to Commerce to liquidate all Consolidated Bearings’ imports of FAG Kugelfischer’s merchandise imported during the period of review in accordance with the September 9, 1997, liquidation instructions; and it is further
ORDERED that the remand results are due wi thin ninety (90) days of the date that this order is entered. Any responses or comments are due within thirty (30) days thereafter. Any rebuttal comments are due within fifteen (15) days after the date the responses or comments are due.

___________________________ NICHOLAS TSOUCALAS SENIOR JUDGE
Dated: January 8, 2002

New York, New York