Changji Esquel Textile Co. Ltd. v. Raimondo
573 F. Supp. 3d 104
| D.D.C. | 2021Background
- On July 22, 2020 the Bureau of Industry and Security (BIS) added Changji Esquel Textile Co. Ltd. (and related Esquel entities) to the U.S. Entity List, citing alleged forced labor of Muslim minorities in Xinjiang.
- Plaintiffs filed suit in July 2021 and moved for a preliminary injunction to remove Changji from the Entity List.
- Plaintiffs’ core legal claims for the injunction: (1) BIS exceeded statutory authority under the Export Control Reform Act (ECRA) by listing for human‑rights reasons; and (2) BIS violated its own regulation requiring listings be supported by “specific and articulable facts.”
- The government defended the listing as authorized by 50 U.S.C. § 4813(a)(16) together with § 4811(2)(D) (foreign‑policy objectives including protection of human rights), and observed that the Federal Register notice identified forced labor in Xinjiang as the basis.
- After an expedited hearing, the court denied the preliminary injunction because plaintiffs failed to show a substantial likelihood of success on the merits. The court therefore did not need to resolve other injunction factors.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ECRA permits listing an entity for alleged human‑rights abuses | ECRA limits Entity List authority to the five categories in §4811(2)(A); human‑rights listings are beyond that scope | ECRA’s text (esp. §4813(a)(16) and §4811(2)(D)) authorizes actions—including listings—to further foreign‑policy goals like protecting human rights | Court held BIS acted within its statutory authority; plaintiffs unlikely to succeed on ultra vires claim |
| Whether BIS violated its regulation requiring listings be supported by “specific and articulable facts” | Plaintiffs say BIS failed to provide the required specific facts and therefore violated 15 C.F.R. §744.11(b) | Government says the EARs do not require full public disclosure of underlying evidence and the FR notice (forced labor in Xinjiang) sufficed; ultra vires review of such regulatory compliance is narrow | Court found plaintiffs could not carry the demanding burden to show a regulatory ultra vires violation |
| Availability and scope of non‑APA ultra vires review | Plaintiffs invoke ultra vires review to challenge listing | Government argues review (if any) is narrow and extraordinary | Court assumed narrow ultra vires review but concluded plaintiffs fail under that standard |
| Whether preliminary injunction should issue | Plaintiffs contend irreparable reputational and economic harm justifies injunction | Government says plaintiffs must first show likelihood of success; absence of that defeats PI | Court denied preliminary injunction because plaintiffs did not show likelihood of success on the merits |
Key Cases Cited
- Lyng v. Payne, 476 U.S. 926 (1986) (agency power limited to congressional delegation)
- Food & Drug Admin. v. Brown & Williamson Tobacco Corp., 529 U.S. 120 (2000) (statutory text must be read in full statutory scheme)
- Chevron U.S.A., Inc. v. Nat. Res. Def. Council, 467 U.S. 837 (1984) (agency interpretation/deference framework)
- Winter v. Natural Res. Def. Council, 555 U.S. 7 (2008) (preliminary‑injunction standard)
- Greater New Orleans Fair Hous. Action Ctr. v. U.S. Dep’t of Hous. & Urb. Dev., 639 F.3d 1078 (D.C. Cir. 2011) (likelihood of success often dispositive for PI)
- Nitro‑Lift Techs., LLC v. Howard, 568 U.S. 17 (2012) (interpretive principle that specific governs the general)
- Leedom v. Kyne, 358 U.S. 184 (1958) (narrow ultra vires judicial‑review exception)
- Adirondack Med. Ctr. v. Sebelius, 740 F.3d 692 (D.C. Cir. 2014) (limits of expressio unius in administrative context)