Justia International Trade Opinion Summaries

The Department of Commerce conducted an antidumping investigation into “Pneumatic Off-The-Road Tires" from China and published results in 2008. In investigations concerning countries with non-market economies (NMEs), such as China, Commerce applies a presumption that all exporters are subject to government control and uses a single antidumping rate for an NME-wide entity. Commerce found DC had overcome the presumption of government control and assigned a separate weighted-average margin. The “entity,” (exporters that failed to overcome the presumption) was assigned a rate of 210.48%, based on facts available with an adverse inference. DC’s assigned margin was 12.91%. During subsequent administrative reviews, those rates remained in place. DC fully cooperated during a fifth review but Commerce determined that it failed to demonstrate the absence of de facto government control and was not eligible for its separate rate. DC had provided its verified sales and production data (resulting in the calculated rate of 0.14%); no other portion of the entity had provided data. Commerce averaged the previous entity-wide rate and DC’s calculated rate, arriving at a final rate of 105.31% applicable to the entity, including DC. The Trade Court concluded that Commerce must assign DC the calculated individual rate.The Federal Circuit reversed. A country-wide NME entity rate may be an “individually investigated” rate under 19 U.S.C. 1673d(c)(1)(B)(i)(I), which Commerce may assign to the unitary group of exporters that have failed to rebut the presumption of government control. Commerce may carry forward an initial NME entity rate, including adverse inferences built into that rate, in subsequent reviews, even where a respondent cooperates but fails to rebut the presumption of government control. View "China Manufactureres Alliance v. United States" on Justia Law

S.C. Johnson imported, from Thailand, Ziploc® brand reclosable sandwich bags, manufactured from polyethylene resin pellets, and tested to ensure compatibility with food contact. Customs classified the bags under Harmonized Tariff Schedule of the United States (HTSUS) subheading 3923.21.00, covering “[a]rticles for the conveyance or packing of goods, of plastics; stoppers, lids, caps and other closures, of plastics: Sacks and bags (including cones): Of polymers of ethylene.”The Federal Circuit affirmed the Trade Court in rejecting an argument that the bags should have been classified under HTSUS subheading 3924.90.56, covering “[t]ableware, kitchenware, other household articles and hygienic or toilet articles, of plastics: Other” The court concluded that “the majority of the Carborundum factors support[ed] classification under HTSUS Heading 3923” and also determined that the bags were prima facie classifiable under heading 3924, noting that “[t]he sandwich bags are designed in a manner consistent with household food storage.” Because the sandwich bags were prima facie classifiable under both headings, the court applied General Rule of Interpretation 3, which dictates that goods should be classified under the heading that provides the most specific description. The sandwich bags were properly classified under HTSUS heading 3923 because that heading “has requirements that are more difficult to satisfy and describe the article with a greater degree of accuracy and certainty.” View "SC Johnson & Son Inc. v. United States" on Justia Law

The Food, Drug, and Cosmetic Act (FDCA), 21 U.S.C. 321(g) regulates homeopathic drugs. A 1988 FDA guidance document outlined the circumstances in which the FDA intended to exercise its discretion not to enforce the full force of the FDCA against homeopathic drugs. In 2019, the FDA withdrew the guidance document, explaining that the homeopathic drug industry had expanded significantly and it had received numerous reports of “[n]egative health effects from drug products labeled as homeopathic.” The FDA then implemented a “risk-based” enforcement approach and added six of MediNatura’s prescription injectable homeopathic products to an import alert, notifying FDA field staff that the products appeared to violate the FDCA.The D.C. Circuit affirmed the dismissal of MediNatura’s challenges. When a product is detained under an import alert, the importer is given notice and an opportunity to be heard, so the import alert was non-final agency action. The court declined to enjoin the withdrawal of the 1988 guidance, noting the public’s strong interest in the enforcement of the FDCA. Requiring the FDA to keep in place a guidance document that no longer reflects its current enforcement thinking, particularly in light of present public health concerns related to homeopathic drugs, is not in the public interest. View "MediNatura, Inc. v. Food and Drug Administration" on Justia Law

Bio-Rad’s patents relate to the generation of microscopic droplets, contiguous fluid that is encapsulated within a different fluid, by using a microfluidic chip. Typically, the inner fluid is water-based, while the outer fluid is oil. The patents arise out of research conducted by inventors at QuantaLife. In 2011, Bio-Rad purchased QuantaLife, acquiring QuantaLife’s patent rights. The inventors became employees of Bio-Rad and executed assignments of their rights to applications that later issued as the 664, 682, and 635 patents. Soon after Bio-Rad acquired QuantaLife, three inventors left Bio-Rad to start 10X, which has developed technology and products in the field of microfluidics, with the goal of achieving DNA and RNA sequencing at the single-cell level. Bio-Rad alleged that 10X violated the Tariff Act, 19 U.S.C. 1337, by importing into the U.S. certain microfluidic chips. The Trade Commission concluded that 10X did not infringe the 664 patent by importing its “Chip GB” but infringed the 664, 682, and 635 patents by importing its “GEM Chips.” The Federal Circuit affirmed. The construction of the term “droplet generation region” is consistent with the intrinsic evidence; substantial evidence established that the use of 10X’s GEM chips directly infringes the asserted claims. Bio-Rad proved the elements of induced and contributory infringement of the 682 and 635 patents with respect to the GEM Chips. View "Bio-Rad Laboratories, Inc. v. United States International Trade Commission" on Justia Law

Following two remands from the Trade Court in an antidumping duty investigation concerning certain corrosion-resistant steel products from India, the Department of Commerce granted Uttam a duty drawback adjustment under 19 U.S.C. 1677a(c)(1)(B) that resulted in no dumping margin. Commerce applied “circumstance of sale” adjustments to remedy the imbalance in the comparison between normal value and export price or constructed export price by removing unrecovered paid and exempted duties from constructed value or home market price and adding the per-unit amount of import duties]to normal value that was added to U.S. price. The Trade Court affirmed.The Federal Circuit affirmed, rejecting a challenge to the propriety of the first remand to Commerce. It makes no difference whether the imported inputs that qualified for a drawback were actually incorporated into goods sold in the exporter’s domestic market because the Indian government credited the drawback to the quantity of goods that were in fact exported, whatever the source of the inputs used to produce foreign goods. The statute requires an upward adjustment to “export price and constructed export price” based on the drawback that occurred “by reason of the exportation of the subject merchandise to the United States.” The entire drawback was allowed “by reason of the exportation.” View "Uttam Galva Steels Ltd. v. United States" on Justia Law

Deacero challenged the Department of Commerce’s final results in the 2014–2015 administrative review of the antidumping duty order covering carbon and certain alloy steel wire rod from Mexico. The Trade Court sustained Commerce’s determination to apply total facts available with an adverse inference but remanded to Commerce twice for further explanation or reconsideration of Commerce’s selection of 40.52 [percent] as the adverse facts available (AFA) rate. Commerce had employed AFA, reasoning that Deacero had “mischaracterized the nature of its [revised Section D database],” “withheld critical information from [Commerce]” when it submitted the revised database by representing that the changes were “minor,” and, despite further “opportunity to explain the revisions,” “Deacero’s response” remained “not satisfactory.”After Commerce placed additional information on the record corroborating the 40.52 percent rate, the Trade Court sustained Commerce’s second remand result. The Federal Circuit affirmed. Commerce’s selection and corroboration of Deacero’s AFA rate is supported by substantial evidence and otherwise in accordance with law. View "Deacero S.A.P.I. de C.V. v. United States" on Justia Law

10X filed a complaint with the International Trade Commission, alleging that Bio-Rad’s importation and sale of microfluidic systems and components used for gene sequencing or related analyses violated the Tariff Act of 1930, 19 U.S.C. 1337, which prohibits importation and sale “of articles that . . . (i) infringe a valid and enforceable United States patent.”An ALJ determined that Bio-Rad violated the statute with respect to all three patents finding that Bio-Rad infringed the patent claims and that 10X practiced the claims, satisfying the requirement of a domestic industry “relating to the articles protected by the patent.” The ALJ rejected Bio-Rad’s defense that it could not be liable for infringement because it co-owned the asserted 10X patents under assignment provisions that two of the named inventors signed when they were employees of BioRad (and its predecessor), even though the inventions were not made until after the employment.The Commission and Federal Circuit affirmed. Substantial evidence supports findings that Bio-Rad infringed the asserted claims and that 0X’s domestic products practice the asserted claims. The court rejected Bio-Rad’s indefiniteness challenge. The assignment provisions did not apply to a signatory’s ideas developed during the employment solely because the ideas ended up contributing to a post-employment patentable invention in a way that supports co-inventorship of that eventual invention. View "Bio-Rad Laboratories, Inc. v. International Trade Commission" on Justia Law

Janssen challenged Customs and Border Protection’s classification of Janssen’s product darunavir ethanolate, the active ingredient in Prezista®, is a medication for the treatment of the human immunodeficiency virus (HIV) under the Harmonized Tariff Schedule of the United States (HTSUS) and the Pharmaceutical Appendix to the Tariff Schedule. Customs had applied subheading 2935.00.95, “Sulfonamides: Other: Drugs: Other,” for a duty rate of 6.5 percent ad valorem, Janssen alleged that it has paid approximately $100 million in duties for entries of darunavir ethanolate that should have received duty-free treatment. The Trade Court concluded that the subject merchandise was properly classified under HTSUS subheading 2935.00.60 and subject to duty-free treatment under the Pharmaceutical Appendix. The Federal Circuit affirmed. The court held that darunavir ethanolate was properly classified under HTSUS subheading 2935.00.60 because it belongs to the sulfonamides class or kind of organic compounds. View "Janssen Ortho, LLC v. United States" on Justia Law

The Department of Commerce initiated a countervailing duty (CVD) investigation on imports of rebar from Turkey and issued questionnaires to the Turkish government and to Habas, the sole respondent, concerning benefits the Turkish government extended to Habas. In response, Habas did not disclose that it received benefits via a duty drawback program. Habas later revealed that it held a permit under the program and occasionally benefitted from drawbacks for raw materials. Habas claimed that it had no obligation to disclose the program in its questionnaire response because Commerce had previously, in another investigation, determined that program benefits were not countervailable; the questionnaire did not specifically inquire about the program.. Commerce imposed a CVD rate of 14.01 percent, finding that Habas failed to cooperate, 19 U.S.C. 1677e(b), when it failed to timely report those benefits. Commerce selected the highest non-de minimis rate for a similar program, based on treatment of the benefit in another countervailing duty proceeding involving Turkey. Commerce had applied the 14.01 percent rate with respect to an export tax rebate program in a 1986 CVD investigation, “Welded Pipe and Tube from Turkey.”The Trade Court rejected Habas’s argument that, even if Commerce was justified in using “facts otherwise available” to select a CVD rate, Commerce’s selection of the 14.01 percent rate was unreasonable because it was not adequately corroborated by the 1986 investigation. The Federal Circuit affirmed. Habas has not shown that Commerce exceeded its statutory authority. View "Habas Sinai Ve Tibbi Gazlar Istihsal Endustrisi A.S. v. United States" on Justia Law

Importation of diamond sawblades from China is governed by an antidumping duty order, 19 U.S.C. 1673. In an administrative review of duties owed on subject merchandise sold to unaffiliated U.S. purchasers in 2014-2015, the Department of Commerce investigated the dumping margin of Bosun, which sends its imports to one of its two U.S. importer-affiliates for sale to unaffiliated U.S. purchasers. The other importer-affiliate imports diamond sawblades from a Bosun entity in Thailand. The importer-affiliates trade between themselves. Bosun’s affiliates did not record the country of origin on each sale. Bosun supplied country-of-origin information from three sources: the country-specific product code for some products; the unit price (which allowed origin identification for some products); and, for the remainder, an inference based on the first-in, first-out, (FIFO) premise. Commerce found the information sufficiently verified. On remand from the Trade Court, Commerce used “facts otherwise available” under 19 U.S.C. 1677e(a), and drew adverse inferences as to the totality of Bosun-sawblade sales.The Federal Circuit remanded. Commerce may have applied section 1677e(a) too broadly by disregarding all of Bosun’s country-of-origin information. The errors Commerce identified in Bosun’s information are apparently limited in their reliability-undermining effect to a defined subset of sawblades, whose origin Bosun identified only through the FIFO-inference. If the unreliable information is confined to some or all sawblades within that defined subset, there is no substantial evidence to support Commerce’s determination that all of the Bosun-supplied origin information was unreliable. View "Diamond Sawblades Manufacturers' Commission v. United States" on Justia Law