Zenith Electronics Corporation v. United States

99 F.3d 1576
CourtCourt of Appeals for the Federal Circuit
DecidedFebruary 27, 1997
Docket95-1455
StatusPublished
Cited by9 cases

This text of 99 F.3d 1576 (Zenith Electronics Corporation v. United States) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Zenith Electronics Corporation v. United States, 99 F.3d 1576 (Fed. Cir. 1997).

Opinion

99 F.3d 1576

18 ITRD 1897

ZENITH ELECTRONICS CORPORATION, Plaintiff,
and
International Brotherhood of Electrical Workers, The
International Union of Electronic, Electrical, Salaried,
Machine and Furniture Workers (AFL-CIO/CLC), The Independent
Radionic Workers of America, and The Industrial Union
Department (AFL-CIO), Plaintiffs,
and
AOC International, Ltd., Plaintiff-Appellant,
v.
The UNITED STATES, Defendant-Appellee.

No. 95-1455.

United States Court of Appeals,
Federal Circuit.

Nov. 7, 1996.
Rehearing Denied; Suggestion for Rehearing In Banc Declined
Feb. 27, 1997.*

Christopher M. Curran, White & Case, Washington, DC, argued, for plaintiff-appellant. With him on the brief, were William J. Clinton and David E. Bond. Of counsel, was Lisa L. Hubbard.

Velta A. Melnbrencis, Assistant Director, Commercial Litigation Branch, Civil Division, Department of Justice, Washington, DC, argued, for defendant-appellee. With her on the brief, were Frank W. Hunger, Assistant Attorney General, and David M. Cohen, Director. Of counsel, were Stephen J. Powell, Chief Counsel for Import Administration, Berniece A. Browne, Senior Counsel, and Rebecca Rejtman, Attorney-Advisor, U.S. Department of Commerce, Washington, DC.

Before PLAGER, RADER, and SCHALL, Circuit Judges.

PER CURIAM.

In this trade case, the International Trade Administration of the Department of Commerce (ITA), and the International Trade Commission (ITC) found that Taiwanese imports of color television receivers (CTVs) pose a threat of material injury to domestic industry. Color Television Receivers, other than Video Monitors, from Taiwan, 49 Fed.Reg. 18,337 (Dep't Comm.1984) (Final Determination). In its Final Determination, the United States Department of Commerce (Commerce) refused AOC International's (AOC) proposed adjustments to the cost of production and constructed value. Color Television Receivers, Except for Video Monitors, From Taiwan; Final Results of Antidumping Duty Administrative Review, 56 Fed.Reg. 65,218 (Dec. 16, 1991) (Final Results). The United States Court of International Trade sustained Commerce's rejection of AOC's claimed adjustments. Zenith Elecs. Corp. v. United States, No. 92-01-00007, 1994 WL 704955 (Dec. 13, 1994 CIT). It also sustained Commerce's remand determination. Zenith Elecs. Corp. v. United States, No. 92-01-00007, 1995 WL 251569 (Apr. 25, 1995 CIT). Under the standard of review which requires that substantial record evidence support Commerce's decision, this court affirms.

BACKGROUND

Antidumping laws impose additional duties on imported products being sold, or likely to be sold, at less than their fair value to the harm of a domestic industry. 19 U.S.C. § 1673 (1994). The difference between the foreign market value and the United States price for the merchandise establishes the amount of the additional duty. Id.

In 1984, Commerce determined that several Taiwanese companies sold CTVs at less than fair value in the United States, injuring the domestic television industry. Final Determination at 18,337. Therefore, the United States Customs Service imposed antidumping duties on CTVs from Taiwan. See 19 U.S.C. §§ 1673, 1673e(a). Six periodic administrative reviews would determine the actual duties. 19 U.S.C. § 1675(a) (1994).

Commerce initiated an administrative review of CTVs for the fourth review period extending from April 1, 1987, through March 31, 1988. The administrative review included AOC as well as other exporters. Initiation of Antidumping and Countervailing Duty Administrative Reviews, 53 Fed.Reg. 18,324 (1988). During the review, Commerce confronted allegations that AOC sold its CTVs in its home market at prices below the cost of production. Color Television Receivers, Except for Video Monitors, From Taiwan; Preliminary Results and Termination in Part of Antidumping Duty Administrative Review, 56 Fed.Reg. 36,765, 36,766 (1991). To verify costs, Commerce issued a questionnaire to AOC requesting data on AOC's: (1) accounting practices; (2) materials costs; (3) labor costs; (4) factory overhead; (5) selling, general, and administrative expenses; (6) profit; (7) packing expenses; (8) production costs; and (9) subsidies.

In its response, AOC claimed an adjustment to its fixed overhead expenses by a "sponsored" amount and to its research and development (R & D) expenses by a "reimbursement" amount. After Commerce questioned these adjustments, AOC produced a two-paragraph contract, allegedly entered into on February 18, 1987, under which AOC's sole home-market distributor, Overseas Electronics Corporation (OEC), agreed to pay AOC NT $24,000,000. AOC deducted this amount from its overhead and R & D expenses for 25" and 28" CTVs. Based on this information, Commerce could not determine that OEC had reimbursed AOC for R & D on large screen CTVs. Final Results at 65,223. Therefore, Commerce rejected AOC's claimed adjustment for reimbursement.

Commerce also rejected AOC's labor rate calculations. AOC claimed that labor rates for CTVs differed significantly from labor rates for similar products at the same production center. AOC met this rejection by providing Commerce its payroll accounting records. Commerce, however, still found no justification for the significantly different labor rates. Commerce, therefore, used AOC's average labor costs in its foreign market value calculation. Final Results at 65,224.

AOC appealed Commerce's duty determination to the Court of International Trade. AOC charged that Commerce had overstated its antidumping liability for this administrative review period. The Court of International Trade sustained Commerce's actions. This appeal followed.

DISCUSSION

The Court of International Trade has the duty of determining whether, on the record as a whole, substantial evidence supports the findings of Commerce. 19 U.S.C. § 1516a(b) (1994). This court again examines the findings of the Department of Commerce to discern whether substantial evidence supports the determination. See Atlantic Sugar, Ltd. v. United States, 744 F.2d 1556, 1559 (Fed.Cir.1984) (applying the substantial evidence standard in reviewing the agency's determination).

Substantial record evidence supports Commerce's determination. AOC challenges two aspects of the Commerce Department's calculations of the cost of production. First, AOC challenges Commerce's denial of an adjustment for reimbursement of R & D expense. In support of this adjustment, AOC produced only a two-paragraph contract and evidence of reimbursement payments from OEC. When Commerce sought further clarification of this evidence, AOC could not show that it had actually performed the R & D referred to in the contract. Moreover, the information AOC did supply--alleged R & D equipment purchase orders--showed purchases over six months before the OEC contract date. Also, AOC apparently finished some R & D projects before AOC entered the contract.

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