by
Hemlock and Sachsen manufacture components of solar-power products. They entered into a series of long-term supply agreements (LTAs), by which Hemlock in Michigan would supply Sachsen in Germany with set quantities of polycrystalline silicon (polysilicon) at fixed prices from 2006-2019. The market price of polysilicon was initially well above the LTA price, but the market price plummeted after the Chinese government began subsidizing its national production of polysilicon. The parties reached a temporary agreement to lower the LTA price in 2011. When that agreement expired, Hemlock demanded that Sachsen pay the original LTA price for 2012. Sachsen refused. Hemlock sued for breach of contract. The district court granted Hemlock summary judgment and awarded nearly $800 million in damages and prejudgment interest. The Sixth Circuit affirmed. The district court: properly struck Sachsen’s antitrust defense because enforcing the take-or-pay provision does not require the parties to engage in the precise conduct that is allegedly unlawful; properly struck Sachsen’s defense that the LTAs illegally tied Sachsen’s predominant demand for polysilicon to a single seller in violation of E.U. antitrust law; properly concluded that Sachsen’s affirmative defenses of commercial impracticability and frustration of purpose lack merit; and properly awarded the full amount of the remaining contract price as liquidated damages, despite Sachsen’s argument that the award was an unreasonable penalty. View "Hemlock Semiconductor Operations, LLC v. SolarWorld Industries Sachsen GMBH" on Justia Law

by
Hemlock and Sachsen manufacture components of solar-power products. They entered into a series of long-term supply agreements (LTAs), by which Hemlock in Michigan would supply Sachsen in Germany with set quantities of polycrystalline silicon (polysilicon) at fixed prices from 2006-2019. The market price of polysilicon was initially well above the LTA price, but the market price plummeted after the Chinese government began subsidizing its national production of polysilicon. The parties reached a temporary agreement to lower the LTA price in 2011. When that agreement expired, Hemlock demanded that Sachsen pay the original LTA price for 2012. Sachsen refused. Hemlock sued for breach of contract. The district court granted Hemlock summary judgment and awarded nearly $800 million in damages and prejudgment interest. The Sixth Circuit affirmed. The district court: properly struck Sachsen’s antitrust defense because enforcing the take-or-pay provision does not require the parties to engage in the precise conduct that is allegedly unlawful; properly struck Sachsen’s defense that the LTAs illegally tied Sachsen’s predominant demand for polysilicon to a single seller in violation of E.U. antitrust law; properly concluded that Sachsen’s affirmative defenses of commercial impracticability and frustration of purpose lack merit; and properly awarded the full amount of the remaining contract price as liquidated damages, despite Sachsen’s argument that the award was an unreasonable penalty. View "Hemlock Semiconductor Operations, LLC v. SolarWorld Industries Sachsen GMBH" on Justia Law

by
In response to a 2005 petition (19 U.S.C. 1673), the Department of Commerce found that diamond sawblades from China were likely sold in the U.S. at less than fair value. For non-market economy (NME) countries, Commerce begins with a rebuttable presumption that all companies within the country are subject to government control and assigns a single antidumping duty rate unless an exporter can demonstrate that it is sufficiently independent. Commerce concluded that ATM qualified for a separate rate of 2.50%. The Trade Court remanded twice. Commerce then concluded that ATM had failed to rebut the presumption of government control, finding that a Chinese government agency controlled one of five ATM entities. The Trade Court and Federal Circuit affirmed in 2013. Commerce conducted its first administrative review before those decisions and found that ATM qualified for a separate rate of 0.15%. On remand, Commerce concluded that ATM did not qualify for a separate rate The China-wide entity rate was then 164.09%. Commerce recalculated that rate—which would apply to ATM and all other members of the China-wide entity—by averaging the previously assigned China-wide rate and the ATM rate, arriving at an entity-wide rate of 82.12%. The Trade Court and Federal Circuit affirmed. Despite ATM’s cooperation with Commerce, it failed to prove independence from government control. View "Diamond Sawblades Manufacturers Coalition v. United States" on Justia Law

by
Container Store’s top tracks and hanging standards, components of its elfa® modular storage and organization system, were imported through Houston in 2007-2008. Customs liquidated the merchandise under Harmonized Tariff Schedule subheading 8302.41.60, a provision for base metal mountings and fittings suitable for buildings. Container Store filed unsuccessful protests, arguing that the merchandise should be classified under subheading 9403.90.80 as parts of furniture. Customs had previously held that the elfa® top tracks and hanging standards were properly classified under subheading 8302.41.60 as mountings suitable for buildings. The Trade Court placed an appeal on its reserve calendar pending resolution of another appeal involving identical merchandise, in which Judge Ridgway ultimately granted Container Store summary judgment. The government later abandoned an appeal. Judge Barnett reached a different conclusion in the present case. The Federal Circuit reversed. The elfa® system constitutes “unit furniture” because it is designed to be hung on a wall, is “fitted with other pieces to form a larger system,” and can be “assembled together in various ways to suit the consumer’s individual needs to hold various objects or articles.” Given that the tracks and standards are designed exclusively for the elfa® unit furniture system, they are properly classified as parts of unit furniture under subheading 9403.90.80. View "The Container Store v. United States" on Justia Law

by
The U.S. Department of Commerce issued final results in the eighth administrative review of the antidumping duty order on certain frozen warm water shrimp from India. Using the “average-to-transaction” methodology with zeroing, Commerce assessed one mandatory respondent with a 1.97 percent duty for entries during a period in 2012. Using a “mixed alternative” methodology, which blends both the average-to-transaction and average-to-average methodologies, Commerce assessed the second mandatory respondent with a 3.01 percent duty for the same time period. Non-mandatory respondents were assessed with a simple-averaged antidumping duty of 2.49 percent. Exporters subject to Commerce’s antidumping duties on frozen warm water shrimp from India challenged the methodology used to calculate the antidumping duties on a number of grounds related to Commerce’s decision to use the average-to-transaction methodology and zeroing. The Court of International Trade and the Federal Circuit affirmed Commerce’s choices of methodologies as a reasonable exercise of its delegated authority, entitled to deference. Commerce provided rationales in support of its analysis and chose the methodology that reasonably achieves the overarching statutory aim of addressing targeted or masked dumping. View "Apex Frozen Foods Private Ltd. v. United States" on Justia Law

by
The creditors shipped goods via common carrier from China to World Imports in the U.S. “free on board” at the port of origin. One shipment left Shanghai on May 26, 2013; World took physical possession of the goods in the U.S. on June 21. Other goods were shipped from Xiamen on May 17, May 31, and June 7, 2013, and were accepted in the U.S. within 20 days of the day on which World filed its Chapter 11 petition. The creditors filed Allowance and Payment of Administrative Expense Claims, 11 U.S.C. 503(b)(9), allowable if: the vendor sold ‘goods’ to the debtor; the goods were "received" by the debtor within 20 days before the bankruptcy filing; and the goods were sold in the ordinary course of business. Section 503(b)(9) does not define "received." The Bankruptcy Court rejected an argument that the UCC should govern and looked to the Convention on Contracts for the International Sale of Goods (CISG). The CISG does not define “received,” so the court looked to international commercial terms (Incoterms) incorporated into the CISG. Although no Incoterm defines “received,” the incoterm governing FOB contracts indicates that the risk transfers to the buyer when the seller delivers the goods to the common carrier. The Bankruptcy Court and the district court found that the goods were “constructively received” when shipped and denied the creditors’ motions. The Third Circuit reversed; the word “received” in 11 U.S.C. 503(b)(9) requires physical possession. View "In re: World Imports Ltd" on Justia Law

by
The Commerce Department conducted an antidumping investigation into Turkish oil country tubular goods, 19 U.S.C. 1677b(a)(1)(B)(i). When calculating the dumping margin, if a foreign country would normally impose an import duty on an input used to manufacture the subject merchandise, but offers a rebate or exemption from the duty if the input is exported to the U.S., Commerce increases the export price to account for the rebated or unpaid import duty (duty drawback). Çayirova produces oil country tubular goods only from J55-grade coils. Çayirova imported various grades of coils but sourced all its J55 from a domestic Turkish producer. Normally, Çayirova would pay an import duty on its imported non-J55 coils. Turkey, however, has a duty drawback regime under which “equivalent goods” may be substituted for each other. A Turkish importer may import goods into Turkey duty-free if the importer exports a sufficient volume of finished goods incorporating either the imported or equivalent goods. Turkey considers Çayirova’s imported coils to be “equivalent” to Çayirova’s domestically-acquired J55 coils. Çayirova used its exports of oil country tubular goods to the U.S. to receive duty drawbacks on its imported non-J55 coils. Commerce, the Trade Court, and the Federal Circuit agreed that Çayirova was not entitled to a duty drawback adjustment to reduce its antidumping margin because none of the goods for which duties were exempted (non-J55 coils) could be used to produce Çayirova’s oil country tubular goods. View "Maverick Tube Corp. v. United States" on Justia Law

by
One-E-Way filed a complaint with the International Trade Commission, alleging infringement of its patents, which disclose a wireless digital audio system designed to let people use wireless headphones privately, without interference, even when multiple people are using wireless headphones in the same space. The specification explains that previous wireless digital audio systems did not provide “private listening without interference where multiple users occupying the same space are operating wireless transmission devices.” The Commission found the claim term “virtually free from interference” indefinite and invalidated the asserted claims of One-E-Way’s patents. The Federal Circuit reversed, finding that the term “virtually free from interference,” as properly interpreted in light of the specification and prosecution history, would inform a person of ordinary skill in the art about the scope of the invention with reasonable certainty. View "One-E-Way, Inc. v. International Trade Commission" on Justia Law

by
Mid Continent Nail requested that the Department of Commerce initiate a third administrative review of its anti-dumping duty order covering certain steel nails from China. Mid Continent did not serve the request directly on Suntec, a Chinese exporter and producer named in the antidumping order and in the request. When Commerce actually initiated the review about a month after receiving the request, it published a notice in the Federal Register, as provided in 19 U.S.C. 1675(a)(1). Despite that publication, however, Suntec did not participate in the review. Because of a lapse in its relationship with the counsel who had been its representative for years in the steel-nail proceedings, Suntec remained unaware of the review until Commerce announced the final results. The Court of International Trade declined to set aside the results of the review as applied to Suntec. The Federal Circuit affirmed, holding that Suntec had failed to demonstrate that it was substantially prejudiced by the service error as to the request for the review because the Federal Register notice constituted notice to Suntec as a matter of law and fully enabled Suntec to participate in the review. View "Suntec Industries Co., Ltd. v. United States" on Justia Law

by
In 2013, domestic producers of oil country tubular goods (OCTG) filed a petition with the Department Commerce alleging that the Government of Turkey (GOT) was providing countervailable subsidies to domestic exporters. Commerce instituted a countervailing duty investigation and selected Borusan and GOT as mandatory respondents. Because hot-rolled steel (HRS) is an input used in the manufacture of OCTG, Commerce then issued each a questionnaire relating to the provision of HRS in Turkey. Borusan did not report input purchases for two of its steel mills, explaining the difficulties in producing the information and asserting that Commerce had sufficient information. Commerce determined that it was appropriate to apply adverse facts available (AFA) to Borusan. The Court of International Trade and the Federal Circuit upheld the determination. Commerce requested information from Borusan, which Borusan did not provide and never claimed that it was unable to provide; there was no evidence that GOT had access to or maintained the HRS data that it claimed that it was unable to provide. View "Maverick Tube Corp. v. United States" on Justia Law