Ams Associates, Inc. v. United States
2013 U.S. App. LEXIS 24761
Fed. Cir.2013Background
- Commerce issued an antidumping duty order in Aug. 2008 covering laminated woven sacks from China; scope included sacks "laminated to an exterior ply of plastic film or ... paper suitable for high quality print graphics."
- Shapiro (importer) imported sacks from Chinese producer Aifudi: some made from Chinese fabric (undisputedly covered) and some from imported non-Chinese fabric (claimed non‑Chinese origin).
- Customs had previously treated sacks made with non‑Chinese fabric as originating in the fabric’s country; Commerce later (May 25, 2010) issued a preliminary country‑of‑origin decision concluding such sacks were Chinese (substantial transformation).
- Commerce then issued a July 23, 2010 “Clarification” instructing Customs to suspend liquidation and require deposits for all entries of laminated woven sacks from China retroactive to Jan. 31, 2008.
- In the second administrative review Commerce applied an adverse facts available rate to Aifudi and affirmed its country‑of‑origin approach; Shapiro challenged only Commerce’s retroactive suspension of liquidation as inconsistent with Commerce’s scope regulations.
- The Court of International Trade agreed with Shapiro, holding Commerce exceeded its authority under 19 C.F.R. § 351.225(l) by suspending liquidation retroactively; the Federal Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Commerce could retroactively suspend liquidation for entries made before initiation of a formal scope inquiry | Shapiro: regulation allows suspension only prospectively—suspension must apply on/after initiation of scope inquiry; retroactive suspension violated § 351.225(l)(2) | LWSC/Commerce: Clarification merely enforced existing order and prevented circumvention; Commerce entitled to deference and may clarify orders | Held: Commerce exceeded its authority; § 351.225(l)(2) permits suspension only prospectively (on/after initiation); retroactive suspension invalid |
| Whether Commerce needed to initiate a formal scope inquiry before suspending liquidation | Shapiro: scope was unclear, so Commerce had to use formal § 351.225 procedures before suspending liquidation retroactively | LWSC: Commerce may clarify and enforce order without formal scope inquiry when preventing circumvention | Held: Because the order’s scope was unclear, Commerce should have used formal scope/circumvention procedures; it could not bypass § 351.225 to effect retroactive suspension |
Key Cases Cited
- American Signature, Inc. v. United States, 598 F.3d 816 (Fed. Cir.) (Commerce’s construction of its regulations is controlling unless plainly erroneous)
- Novosteel SA v. United States, 284 F.3d 1261 (Fed. Cir.) (Commerce may clarify orders but may not change scope)
- Bowles v. Seminole Rock & Sand Co., 325 U.S. 410 (U.S.) (agency interpretations of its regulations are controlling unless plainly erroneous)
- Fort Stewart Schools v. Federal Labor Relations Auth., 495 U.S. 641 (U.S.) (agency must follow its own regulations)
- Torrington Co. v. United States, 82 F.3d 1039 (Fed. Cir.) (Commerce must follow its own regulations)
- Huaiyin Foreign Trade Corp. v. United States, 322 F.3d 1369 (Fed. Cir.) (Commerce need not open formal scope inquiry when original order is clear)