2019 CIT 70
Ct. Int'l Trade2019Background
- Commerce issued antidumping and countervailing duty Orders (2011) covering aluminum extrusions made from Aluminum Association series 1xxx, 3xxx, and 6xxx and expressly excluding series 5xxx alloys.
- After a 2012 scope ruling finding a specific heat-treated 5050 extrusion outside the Orders, the Aluminum Extrusions Fair Trade Committee requested an anticircumvention inquiry into heat-treated 5050-grade extrusions exported by Zhongwang.
- Commerce initiated a later-developed-products anticircumvention inquiry (Mar. 21, 2016), preliminarily found heat-treated 5050 extrusions to be later-developed merchandise circumventing the Orders, and instructed CBP to suspend liquidation retroactive to the initiation date for all PRC exporters.
- Plaintiffs (Tai-Ao and Regal) challenged Commerce's findings: arguing Commerce lacked authority given the Orders' exclusion of 5xxx, that record evidence did not support a later-developed finding, that Commerce improperly rejected late NFI from Regal, and that retroactive suspension to the initiation date lacked adequate notice to non-Zhongwang exporters.
- The Court sustained Commerce's authority to conduct the anticircumvention inquiry, and its finding that heat-treated 5050 extrusions are later-developed merchandise supported by substantial evidence, and upheld rejection of Regal's late NFI.
- The Court remanded, however, because Commerce's retroactive suspension of liquidation to the initiation date was impermissible as to Tai-Ao and Regal: the Initiation Notice did not provide adequate notice that exporters other than Zhongwang were subject to suspension, so suspension must be effective no earlier than the preliminary determination.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Authority to conduct anticircumvention (later-developed) inquiry despite Orders' 5xxx exclusion | Orders expressly exclude 5xxx; prior scope rulings found heat-treated 5050 outside scope, so Commerce lacked authority | Anticircumvention statute permits Commerce to treat later-developed products as within scope when they did not exist at original investigation | Held: Commerce acted within authority; later-developed products could not have been addressed in original Orders (Target III relied upon) |
| Whether heat-treated 5050 extrusions are later-developed merchandise (commercial availability and §1677j(d) criteria) | Plaintiffs: record shows 5050 alloy existed and some evidence (e.g., Australian spec, 5052 production) undermines commercial unavailability finding | Commerce: Aluminum Association did not recognize heat-treatability of 5xxx at time of Orders; industry catalogs and importer statements show heat-treated 5050 extrusions were developed after Orders; statutory criteria met | Held: Substantial evidence supports Commerce's conclusion that heat-treated 5050 extrusions were not commercially available at the time of the Orders and meet the five statutory factors; circumventing determination sustained |
| Rejection of Regal's late New Factual Information (NFI) | Regal: Commerce abused discretion by refusing to accept April 28, 2017 NFI | Commerce: deadline established; late filing would prejudice parties; regulations permit rejecting untimely NFI | Held: No abuse of discretion; Commerce permissibly rejected untimely NFI under its rules and statutory framework |
| Retroactive suspension of liquidation to initiation date for non-Zhongwang exporters | Plaintiffs: Initiation Notice did not give adequate notice that inquiry would apply to exporters other than Zhongwang; suspension to initiation date unlawful as to them | Government: initiation language indicated Commerce "intended to consider" extending inquiry to all exporters and precedent supports retroactive suspension to initiation | Held: Initiation Notice language was insufficient to give reasonable notice to other exporters; retroactive suspension to initiation date impermissible for Tai-Ao and Regal — suspension may be applied from the preliminary determination date |
Key Cases Cited
- Target Corp. v. United States, 609 F.3d 1352 (Fed. Cir.) (anticircumvention later-developed merchandise framework and commercial-availability test)
- Wheatland Tube Co. v. United States, 161 F.3d 1365 (Fed. Cir.) (limits on Commerce's scope interpretation; purpose of anticircumvention inquiries)
- AMS Assocs. v. United States, 737 F.3d 1338 (Fed. Cir.) (retroactivity limits when scope is ambiguous)
- Transcom, Inc. v. United States, 182 F.3d 876 (Fed. Cir.) (notice required by Federal Register initiation for affected parties)
- Huaiyin Foreign Trade Corp. v. United States, 322 F.3d 1369 (Fed. Cir.) (clarity required in initiation notice when condition would expand coverage)
- Vt. Yankee Nuclear Power Corp. v. Nat. Res. Def. Council, Inc., 435 U.S. 519 (U.S.) (agencies may set procedural rules and deadlines)