Justia International Trade Opinion Summaries

Articles Posted in US Court of Appeals for the Federal Circuit
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Borusan claimed that it was entitled to a post-sale price adjustment based on the total value of penalties it paid for late delivery of products (large diameter welded pipe) to a customer. The Trade Court agreed and remanded to the U.S. Department of Commerce with instructions to grant the claimed post-sale price adjustment and recalculate the resulting antidumping duty margins. On remand, “Consistent with the [CIT’s] remand, and under protest,” Commerce granted Borusan a post-sale price adjustment based on Borusan’s final allocated share of the penalty, which produced a de minimis antidumping duty rate.The Federal Circuit reversed, concluding that the Department of Commerce’s original post-sale price adjustment was supported by substantial evidence and in accordance with law. Commerce determined, in the course of applying the proper factors provided in its regulations, that a potential existed for manipulating the postsale price adjustment because the claimed adjustment was not tethered to what was established and known to the client at the time of sale. Consistent with its legitimate goal of avoiding such manipulation, Commerce correctly set the post-sale price adjustment in a reasonable manner, based on evidence that existed at the time of sale, that addressed its manipulation concerns. View "Borusan Mannesmann Boru Sanayi Ve Ticaret A.S. v. American Cast Iron Pipe Cp." on Justia Law

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The Department of Commerce initiated a less-than-fair-value investigation into the importation of welded line pipe from Korea, focused on sales by two Korea-based respondents, SeAH and HYSCO. Commerce issued a preliminary determination that SeAH likely was selling welded line pipe in the U.S. at less than fair value during the relevant period. SeAH filed a case brief challenging Commerce’s statistical analysis and citing academic literature in support of that challenge. Commerce rejected SeAH’s case brief for violating procedural regulations and issued a final determination. Commerce calculated SeAH’s weighted-average dumping margin to be above the de minimis threshold for less-than-fair-value investigations by applying its differential pricing analysis to SeAH’s sales and selecting the hybrid approach for calculating SeAH’s weighted-average dumping margin. The Trade Court affirmed.The Federal Circuit affirmed in part, upholding Commerce’s rejection of portions of SeAH’s case brief and aspects of the analysis Commerce used to derive the dumping margin. The court vacated and remanded to give Commerce an opportunity to explain whether the limits on the use of the Cohen’s d test to evaluate whether the test group differs significantly from the comparison group were satisfied or whether those limits need not be observed when Commerce uses the test in less-than-fair-value adjudications. The court “invited” Commerce to clarify its argument that having the entire universe of data rather than a sample makes it permissible to disregard the otherwise-applicable limitations on the use of the Cohen’s d test. View "Stupp Corp. v. United States" on Justia Law

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TRI filed entries of citric acid, identifying India as the country of origin, which allowed TRI to file the subject entries as type 01 “consumption” entries, which are not subject to duties, rather than type 03 “consumption—antidumping (AD)/countervailing duty (CVD)” entries. Customs requested information regarding the entries. TRI responded with documentation of the purchase and receipt of citric acid monohydrate from suppliers in India and the processing of the citric acid monohydrate into citric acid anhydrous. TRI admits that the origin of the citric acid monohydrate is unknown. Customs extended liquidation of the entries, 19 U.S.C. 1504(b)(1). Customs’ Office of Laboratory and Scientific Services investigated the processing of the citric acid in India; Customs determined that the product was not substantially transformed and therefore not a product of India. The entries would be liquidated with the applicable consumption, anti-dumping and countervailing duties.TRI filed suit in the Court of International Trade, asserting residual jurisdiction under 28 U.S.C. 1581(I). Separately, TRI also protested Customs’ liquidation of its entries. The Federal Circuit affirmed the Trade Court’s dismissal of the suit for lack of jurisdiction because jurisdiction was available under other section 1581 subsections. Where a plaintiff asserts section 1581(i) jurisdiction, it “bears the burden of showing that another subsection is either unavailable or manifestly inadequate.” TRI has not established that a scope determination or a protest were unavailable or manifestly inadequate. View "TR International Trading Co., Inc. v. United States" on Justia Law

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Under 19 U.S.C. 1862, if the President receives, and agrees with, a finding by the Secretary of Commerce that imports of an article threaten to impair national security, the President shall take action to alleviate the threat. Section 1862(c)(1) specifies a period within which the President is to concur or disagree with the Secretary’s finding and to determine the necessary action and another period within which the President is thereafter to implement the chosen action.In January 2018, the Secretary found that imports of steel threatened to impair national security by causing domestic steel-production capacity to be used less than the level needed for operation of the plants to be profitably sustained. In March 2018, within the period prescribed, the President agreed with that finding and announced a plan (Proclamation 9705) that imposed some tariffs immediately, announced negotiations with specified nations, and stated that the immediate measures might be adjusted as necessary. Within months, the President determined that imports were still too high to meet the Secretary’s identified target and raised the tariff on steel from Turkey, Proclamation 9772.The Trade Court found Proclamation 9772 unlawful. The Federal Circuit reversed. The President did not depart from the Secretary’s finding of a national-security threat; the March 2018 presidential action announced a continuing course of action that could include adjustments. The President’s decision to take one of several possible steps to achieve the goal of increasing utilization of domestic steel plants’ capacity for national security reasons meets the rational-basis standard. View "Transpacific Steel LLC v. United States" on Justia Law

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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

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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

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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

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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

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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

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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