2018 CIT 63
Ct. Intl. Trade2018Background
- Mid Continent petitioned Commerce in 2014 to impose antidumping and countervailing duties on certain steel nails from Vietnam; Commerce issued Orders in July 2015 covering "certain steel nails" with a written scope description.
- OMG imports zinc anchors from Vietnam; each anchor is a unitary article composed of a zinc alloy body (~62% weight) and a zinc‑plated steel pin (~38% weight) assembled in Vietnam.
- OMG requested a Commerce scope ruling (Aug. 2016) that its zinc anchors are excluded from the Orders; Mid Continent opposed.
- Commerce issued a Final Scope Ruling (Feb. 6, 2017) concluding the anchors fell within the Orders, reasoning the steel pin component met the common meaning of a "nail" and the unitary product therefore was within scope.
- OMG sued in the Court of International Trade; the court reviewed whether the Orders’ language was unambiguous and whether Commerce's determination was supported by law and substantial evidence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether OMG's zinc anchors fall within the Orders' scope | Anchors are unitary articles whose primary fastening element is the expanded zinc body, not a "nail"; thus they are outside the Orders | The steel pin component is a "nail" and a critical fastening component so the unitary anchor is within the Orders | Held: anchors are not "nails" under the plain meaning; therefore outside the Orders |
| Whether the term "nail" in the Orders is ambiguous | "Nail" has an ordinary, unambiguous meaning (slender, pointed fastener driven by impact) — OMG argues anchors do not fit | Government argues industry usage and marketing show overlap and thus scope can include such anchors | Held: "nail" is unambiguous; ordinary definitions control and anchors do not meet that definition |
| Whether Commerce could rely on (k)(1) sources (petition/description) to include OMG's product | OMG: (k)(1) sources are not dispositive and do not definitively describe OMG's anchors as nails | Gov/Mid Continent: (k)(1) sources and industry materials support inclusion, and a full (k)(2) inquiry was unnecessary | Held: Commerce erred by treating the product as a nail under the plain language; (k)(1) materials did not overcome the plain‑language mismatch and Commerce must reconsider consistent with the opinion |
| Retroactive suspension of liquidation for earlier entries | OMG opposes retroactive duties on entries prior to the ruling | Government seeks authority to instruct CBP to retroactively suspend liquidation | Held: Court remanded; Commerce must issue instructions to CBP regarding retroactive suspension as part of remand proceedings |
Key Cases Cited
- Duferco Steel, Inc. v. United States, 296 F.3d 1087 (Fed. Cir.) (terms of an order govern its scope and scope cannot be changed contrary to its terms)
- Meridian Prods., LLC v. United States, 851 F.3d 1375 (Fed. Cir.) (question whether order terms are ambiguous is reviewed de novo)
- ArcelorMittal Stainless Belg. N.V. v. United States, 694 F.3d 82 (Fed. Cir.) (scope terms should align with trade usage where possible)
- Smith Corona Corp. v. United States, 915 F.2d 683 (Fed. Cir.) (clarification of scope cannot alter order terms)
- Wheatland Tube Co. v. United States, 161 F.3d 1365 (Fed. Cir.) (terms of an order govern its scope)
- Diversified Prods. Corp. v. United States, 572 F. Supp. 883 (CIT) (five‑factor test for scope inquiries codified in 19 C.F.R. § 351.225(k)(2))