Justia International Trade Opinion Summaries

In 2012, Meridian asked the U.S. Department of Commerce to issue a scope ruling that certain aluminum trim kit packages did not fall within the scope of the antidumping and countervailing duty orders (19 U.S.C. 1671(a)(1)) on aluminum extrusions from the People’s Republic of China. Commerce found the trim kits subject to the Orders’ scope. Five opinions and three remands later, the Trade Court sustained Commerce’s third remand determination, under protest, that the trim kits do not fall within the Orders’ scope. The Federal Circuit reversed. Commerce did not err in its interpretation of the finished goods kit exclusion in the initial scope ruling. The exclusion states that, to fall outside the scope of the Orders, a finished goods kit must contain more than only aluminum extrusion parts necessary for final assembly. Substantial evidence supports Commerce’s finding that the trim kits meet the exception to the finished goods kit exclusion. View "Meridian Products, LLC v. United States" on Justia Law

Organik and Dow both manufacture opaque polymers, hollow spheres used as additives to increase paint’s opacity. Dow has maintained its worldwide market-leader position through a combination of patent and trade-secret protections. Dow filed a complaint with the International Trade Commission requesting an investigation into whether Organik’s opaque polymer products infringed four Dow patents. The Commission granted Dow’s request, and the parties began discovery. During the proceedings, Dow amended its complaint to add allegations of trade secret misappropriation when it discovered that Organik may have coordinated the production of its opaque polymers with the assistance of former Dow employees. As Dow attempted to obtain discovery relating to the activities of those employees, Dow discovered spoliation of evidence “on a staggering scale.” The Federal Circuit affirmed the Commission’s imposition of default judgment and entry of a limited exclusion order against Organik as sanctions for the spoliation of evidence. Organik’s “willful, bad faith misconduct” deprived Dow of its ability to pursue its trade secret misappropriation claim effectively. The record supports the limited exclusion order of 25 years with the opportunity for Organik to bypass that order at any time if it can show that it has developed its opaque polymers without using Dow’s misappropriated trade secrets. View "Organik Kimya v. International Trade Commission" on Justia Law

In 2010, the Department of Commerce initiated an antidumping-duty investigation of multilayered wood flooring from China (19 U.S.C. 1673a(b)) and sent questionnaires to Chinese exporters and producers, selecting the three largest exporters as mandatory respondents. Commerce deems China to be a nonmarket economy and presumes that each Chinese exporter and producer is state-controlled, and covered by a single China-wide antidumping-duty rate, but a firm may rebut the presumption. Commerce determined that 74 firms established their independence from the Chinese government (not individually investigated, but not covered by the China-wide rate) and calculated a “separate rate.” Commerce did not individually investigate the appellants to determine firm-specific dumping margins. It assigned them a rate that, though not specified numerically, was declared to be more than de minimis, even though it found zero or de minimis dumping margins for all three of the Chinese firms that were individually investigated. The Trade Court affirmed. The Federal Circuit subsequently held that the “separate rate” method used in this case was a departure from the congressionally-approved “expected method” applicable when all of the individually investigated firms have a zero or de minimis rate, and that certain findings are necessary to justify such a departure. Under the “expected method,” appellants would be entitled to a de minimis rate. Because Commerce did not make the necessary findings, the Federal Circuit vacated. View "Changzhou Hawd Flooring Co. v. United States" on Justia Law

Chengde is a Chinese producer of oil country tubular goods (OCTG), steel tubing products used in oil and gas drilling, and ATP is the importer of record during the relevant period. In 2011, the Department of Commerce initiated the first administrative review of the antidumping duty order directed to OCTG from China and selected Chengde as a mandatory respondent. Because China is considered a nonmarket economy country, Commerce selected Indonesia, a market economy country, as the primary surrogate country from which it would use surrogate values to ascertain Chengde’s factors of production. In the Final Results, Commerce assigned Chengde a dumping margin of 162.69%. The Trade Court and Federal Circuit affirmed, finding that Commerce’s antidumping duty calculations were supported by substantial evidence and otherwise in accordance with law. The court rejected challenges to Commerce’s decision to use a simple average of surrogate values for carbon steel billets and alloy steel billets for the untested OCTG; its denial of scrap byproduct offset; and its treatment of international freight as nonmarket economy transactions. View "American Tubular Products, LLC v. United States" on Justia Law

A 2011 petition alleged that imports of steel nails from the United Arab Emirates were being sold in the U.S. at less than fair value. The Department of Commerce initiated an antidumping investigation, determined that Precision was a mandatory respondent, and found that Precision had engaged in “targeted dumping,” with sales reflecting “export prices . . . that differ[ed] significantly among certain customers, regions, and time periods.” Commerce may calculate dumping margins using the average-to-average, the transaction-to-transaction, or the average-to transaction methods, 19 U.S.C. 1677f-1(d)(1)(A)(i)–(ii). The average-transaction methodology results in higher margins because sales at non-dumped prices are given a value of zero and only sales at dumped prices are aggregated. Commerce historically applied the Limiting Regulation, under which, use of the average-transaction methodology required explanation of why the other two methodologies fail to sufficiently account for dumping. In 2008, Commerce withdrew the Limiting Regulation. Commerce acknowledged that the repeal required prior notice and public comment, but “waive[d] the requirement,” invoking the “good cause” exception because the regulations were applicable to ongoing investigations. In calculating Precision’s dumping margin three years later, Commerce applied the average-to-transaction methodology. The Trade Court held that Commerce had violated the Administrative Procedure Act by withdrawing the regulation without providing notice and opportunity for comment. On remand, Commerce redetermined Precision’s duty by applying the withdrawn regulation and found that no duty was owing. The Trade Court and Federal Circuit affirmed. View "Mid Continent Nail Corp. v. United States" on Justia Law

Schlumberger, an oil well services provider, imported bauxite proppants from China for use in providing hydraulic fracturing services to U.S. customers. The subject merchandise, when combined with other materials after importation, increased oil well productivity by preventing fractures in rock formations from closing. U.S. Customs & Border Protection classified the subject merchandise under Subheading 6909.19.50 of the Harmonized Tariff Schedule of the United States (HTSUS). That subheading, with a duty rate of four percent, covers “Ceramic wares for laboratory, chemical, or other technical uses; ceramic troughs, tubs and similar receptacles of a kind used in agriculture; ceramic pots, jars and similar articles of a kind used for the conveyance or packing of goods: Other: Other.” The Trade Court rejected that classification and entered summary judgment that the subject merchandise should enter under HTSUS 2606.00.00, as “Aluminum ores and concentrates: Bauxite, calcined: Other.” The Federal Circuit affirmed, after examining the products listed in the subheadings proposed by Customs and noting that, unlike the listed products, the subject proppants do not possess a definite form. View "Schlumberger Technology Corp. v. United States" on Justia Law

At Appvion’s request, the Department of Commerce initiated a third administrative review of its antidumping duty order covering lightweight thermal paper from Germany. Koehler responded to Commerce’s antidumping questionnaire, including aggregate information about the quantity and value of home-market sales and a database showing individual home-market sales transactions. Commerce issued a supplemental questionnaire. Appvion filed an affidavit from a confidential source asserting that Koehler was engaged in a transshipment scheme, shipping goods destined for its home market through other markets so that those sales would not be reported as home-market sales to Commerce. After two extensions of time, Koehler’s response admitted that its employees had knowingly transshipped certain orders that should have been reported as home-market sales. It proffered an updated home-market sales database that allegedly included those sales. Commerce refused to accept the updated data, stating that the supplemental questionnaire had requested only clarification, not new data. Commerce found that Koehler had withheld information, failed to timely provide information, significantly impeded the proceeding, provided information that could not be verified, and failed to cooperate to the best of its ability. Commerce invoked its authority (19 U.S.C. 1677e) to draw adverse inferences and adopted, as Koehler’s dumping margin, the highest rate alleged in Appvion’s petition, 75.36%. The Trade Court and Federal Circuit affirmed, noting Commerce’s “considerable discretion” and that Commerce gave Koehler an opportunity to explain its conduct. View "Papierfabrik August Koehler SE v. United States" on Justia Law

Following a request from ICP, Customs issued a Ruling Letter, classifying ICP’s white sauce as “sauces and preparations therefor” under the Harmonized Tariff Schedule of the United States (HTSUS) 2103.90.9060. Years later, Customs issued a Notice of Action reclassifying pending and future entries of white sauce as “[b]utter and . . . dairy spreads” under HTSUS 0405.20.3000, which increased the tariff by approximately 2400%. After protesting and paying duties on a single entry, ICP filed a claim in the Court of International Trade, alleging the Notice of Action improperly revoked the Ruling Letter without following the procedures required by 19 U.S.C. 1625(c). Since ICP filed its first action in 2005, the CIT has issued five separate opinions on the matter, two of which were appealed to the Federal Circuit. In awarding ICP attorney fees, the Trade Court found that “The record ... establishe[d] that the goverment position was rooted in a desire to avoid the timely revocation process” by using the Notice of Action, rather than following the procedures of 1625(c)(1). The Federal Circuit affirmed the award under the Equal Access to Justice Act, 28 U.S.C. 2412(d)(1)(A), upholding the Trade Court’s analysis of whether the government’s conduct was “substantially justified.” View "International Custom Products, Inc. v. United States" on Justia Law

Kyocera manufactures solar panels in Mexico and imports them to the U.S. The panels incorporate crystalline silicon photovoltaic (CSPV) cells from Taiwan, which are strung together, sealed, and framed to make solar modules. CSPV cells are the main electricity-generating component of solar modules, which were subject to an antidumping duty investigation into CSPV products from China and Taiwan. The Department of Commerce defined the investigation’s scope to include cells and modules produced in Taiwan and certain modules “completed or partially manufactured” in other countries. Kyocera unsuccessfully challenged Commerce’s scope determination, requesting that it exclude solar modules produced in Mexico, including modules using CSPV cells manufactured in Taiwan. Using Commerce’s scope determination, the International Trade Commission determined that an industry within the U.S. had been materially injured by imports of CSPV products from Taiwan. The ITC declined to conduct a separate negligibility analysis under 19 U.S.C. 1677(24), stating that the Commission must defer to Commerce’s definition of the scope of the merchandise subject to these investigations. The Trade Court agreed. The Federal Circuit affirmed, rejecting an argument section 1677(24)’s definition of negligible merchandise directs the Commission to consider whether “imports from a country” are negligible so that imports from Mexico could be considered separately. View "Kyocera Solar, Inc. v. United States International Trade Commission" on Justia Law

In 2004-2006 Tyco imported 42 models of liquid-filled glass bulbs, commonly used as a temperature-dependent trigger component of fire sprinkler heads. When the sprinkler head is exposed to fire, the bulb is heated and the liquid inside the bulb expands until the bulb shatters. When the bulb breaks, the valve of the sprinkler system opens and releases a shower of water to extinguish the fire. The bulbs can also be used in water heaters. The bulbs break at different temperatures, depending on the liquid. Tyco used 39 models in fire sprinkler systems and three models as thermal release devices in water heaters. Customs and Border Protection classified the bulbs as “other articles of glass” under the Harmonized Tariff Schedule of the United States (HTSUS) subheading 7020.00.60, which has a 5% rate of duty. Tyco protested, asserting that the bulbs would be more properly classified under subheading 8424.90.90, which includes “Other” “Parts” of goods classified under heading 8424 and is duty-free. Customs denied Tyco’s protest. The Trade Court upheld the ruling, finding that the bulbs are “of glass.” The Federal Circuit affirmed. While the liquid component is “the brains behind the operation,” the essential character of the product is glass. View "Tyco Fire Products, L.P. v. United States" on Justia Law