466 F.Supp.3d 1320
Ct. Int'l Trade2020Background
- In March 2018 the President (Proclamation 9705) imposed a 25% Section 232 tariff on certain steel imports and directed Commerce to establish an exclusion process (codified at 15 C.F.R. Pt. 705, Supp. 1).
- JSW Steel (USA) submitted 12 exclusion requests for alloy and non-alloy steel slabs (six from India, six from Mexico) claiming the required slabs or acceptable substitutes were not produced in the U.S. in sufficient amount or satisfactory quality.
- Domestic producers (U.S. Steel, AK Steel, Nucor) filed objections; JSW filed rebuttals and the objectors filed surrebuttals. BIS (with ITA analysis) denied all 12 requests, and for six denials also found alleged HTSUS classification errors.
- JSW sued in the Court of International Trade, challenging the denials as arbitrary and capricious and arguing the administrative record was incomplete because of undisclosed ex parte meetings between Commerce officials and objectors.
- The court found the BIS decision memoranda and ITA recommendation memoranda lacked factual analysis and explanation; it ordered Commerce to certify steps taken to complete the record, to supplement the record as appropriate, and remanded all 12 denials for further explanation. The court denied JSW’s requests for discovery and for a privilege log.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Were Commerce's denials arbitrary and capricious (insufficient explanation)? | JSW: denials contradict the record and lack reasoned analysis tying record evidence to conclusions. | U.S.: BIS and ITA provided adequate basis; record supports denials. | Court: Denials lack explanation and factual tying to the record; remand required for full explanation. |
| Is the administrative record complete and must Commerce disclose ex parte communications? | JSW: record omits meetings and related materials; disclosure or discovery required to evaluate potential undue influence. | U.S.: Record now certified; ex parte meetings need not be included unless relied upon; no discovery warranted absent bad faith showing. | Court: Commerce must certify steps taken to compile/complete the record, identify if ex parte communications existed and whether they were relied on, and supplement the record if such communications were considered; no discovery now. |
| Should the court order discovery or a privilege log for withheld/deliberative materials? | JSW: requests discovery and a privilege log to uncover contents of ex parte meetings and redactions. | U.S.: No discovery or privilege log is appropriate; deliberative materials are generally privileged absent strong evidence of bad faith. | Court: Denied discovery and privilege-log request; will entertain discovery only if later facts show bad faith/impropriety. |
| Should any exclusion(s) be granted outright on the existing record? | JSW: urges immediate grant of several requests because the record plainly supports approval. | U.S.: Requests remand or defends denials. | Court: Declined to grant exclusions; remanded all 12 for reconsideration in light of completed record. |
Key Cases Cited
- Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983) (arbitrary-and-capricious review standards).
- Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402 (1971) (scope of administrative record and when courts may order supplementation).
- Camp v. Pitts, 411 U.S. 138 (1973) (review limited to the reasons given by the agency).
- Axiom Res. Mgmt., Inc. v. United States, 564 F.3d 1374 (Fed. Cir. 2009) (courts must review the whole administrative record to avoid de novo review).
- Nat. Res. Def. Council, Inc. v. Train, 519 F.2d 287 (D.C. Cir. 1975) (agency must produce complete administrative record).
- Ammex, Inc. v. United States, 62 F. Supp. 2d 1148 (1999) (administrative record includes materials directly or indirectly considered by agency).
- Oceana, Inc. v. Ross, 920 F.3d 855 (D.C. Cir. 2019) (privileged deliberative materials are generally not discoverable absent bad faith).
- Sierra Club v. EPA, 346 F.3d 955 (9th Cir. 2003) (circumstances supporting outright grant of relief where the correct result is plain).