2019 CIT 20
Ct. Int'l Trade2019Background
- Star Pipe imported ductile iron flanges and requested a Commerce scope ruling (June 2017) that the flanges are excluded from the antidumping duty Order on non‑malleable cast iron pipe fittings from China (Order issued Apr. 2003).
- Commerce issued a Final Scope Ruling (Aug. 17, 2017) concluding Star Pipe’s ductile iron flanges are within the Order, relying on 19 C.F.R. § 351.225(k)(1) (scope language, prior determinations, and ITC report) and not applying § 351.225(k)(2) factors.
- Star Pipe sued in the Court of International Trade seeking judgment on the agency record; alternatively argued Commerce should have initiated a formal scope inquiry under § 351.225(k)(2), and challenged post‑ruling liquidation instructions assessing duties on prior entries.
- The record shows Star Pipe’s flanges conform to AWWA C115 and are typically attached and machined by fabricators post‑importation; Star Pipe argued the petition and ITC report distinguish flanges from the listed subject fittings and focus subject fittings on fire/steam uses, not water/wastewater uses.
- Commerce relied on the ITC’s description of “pipe fittings” as items that connect bores or apparatuses, and on prior scope rulings, to classify the flanges as fittings; Commerce did not place the antidumping petition on the record or analyze petition descriptions in its written scope decision.
- The Court concluded Commerce failed to comply with § 351.225(k)(1) by not considering petition descriptions and selectively disregarded record evidence in the ITC report that detracted from treating Star Pipe’s flanges as subject merchandise; Court remanded for reconsideration and supplementation of the record.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Star Pipe's ductile iron flanges are within the scope of the Order | Flanges are distinct from the subject "pipe fittings" listed in the Order; petition/ITC show flanges are used in water/wastewater and are fabricated post‑importation (not pipe fitter products) and thus excluded | Commerce argued the flanges have the same physical characteristics as subject fittings and fall within the clause including ductile fittings with same physical characteristics; prior scope rulings and ITC language support inclusion | Remand: Commerce's scope ruling set aside for failure to consider petition descriptions and for selective reliance on ITC report; reconsideration required |
| Whether Commerce properly relied solely on § 351.225(k)(1) and avoided a formal scope inquiry under § 351.225(k)(2) | If (k)(1) not dispositive, Commerce should have initiated formal scope inquiry and applied (k)(2) factors | Commerce applied (k)(1) and deemed it dispositive; no formal (k)(2) inquiry needed per Commerce | Court did not decide on the merits; remanded for Commerce to reassess (k)(1) materials first; (k)(2) not directed to be applied now |
| Whether Commerce unlawfully instructed Customs to liquidate prior entries and assess duties before the Final Scope Ruling | If scope ruling invalid, liquidation instructions assessing duties on pre‑ruling entries were unlawful; Star Pipe sought relief | Government opposed now; argued premature while scope ruling stands | Court held this claim in abeyance pending remand outcome and did not rule on liquidation instructions |
Key Cases Cited
- CS Wind Vietnam Co. v. United States, 832 F.3d 1367 (Fed. Cir.) (record must account for evidence that detracts from agency conclusion)
- Gerald Metals, Inc. v. United States, 132 F.3d 716 (Fed. Cir.) (substantial evidence review requires consideration of record detractors)
- Mid Continent Nail Corp. v. United States, 725 F.3d 1295 (Fed. Cir.) (scope interpretation begins with scope language)
- Duferco Steel, Inc. v. United States, 296 F.3d 1087 (Fed. Cir.) (scope includes merchandise only if language specifically or reasonably encompasses it)
- Atkore Steel Components, Inc. v. United States, 313 F. Supp. 3d 1374 (Ct. Int’l Trade) (consideration of (k)(1) sources prevents imposing duties absent ITC injury finding)