Justia U.S. Federal Circuit Court of Appeals Opinion Summaries

In 2009, the Department of Commerce initiated administrative review of an antidumping duty order, issuing questionnaires to Mueller, an exporter, which purchased most of its subject merchandise from TUNA and Ternium, and to TUNA and Ternium. Although Mueller cooperated in the review, Mueller did not possess all of the necessary production cost information. TUNA’s review was rescinded because there were no direct shipments, and Ternium opted not to participate in its own margin calculation. As a result, Commerce drew an adverse inference against Ternium (19 U.S.C. 1677e(b)), assigning an adverse facts available (AFA) dumping margin of 48.33 percent. Commerce identified the three sales transactions between TUNA and Mueller made at the greatest discount, where Mueller’s acquisition cost was the furthest below TUNA’s production cost, then inferred that all Ternium pipe that was sold to Mueller involved that discount for acquisition cost. Although there were other sales that were not discounted as significantly, Commerce did not use that data in calculating a new weighted average dumping rate for Mueller of 19.81 percent. Mueller filed suit, alleging that Commerce’s application of Ternium’s AFA to its calculation of the margin for Mueller, despite Mueller’s cooperation, was improper, and that Commerce should have calculated production costs using the entire TUNA data set. The Trade Court affirmed. The Federal Circuit vacated. While Commerce from drawing adverse inferences against a non-cooperating party that have collateral consequences for a cooperating party, in this case Commerce drew two adverse inferences and there is no direct adverse effect on Ternium from using an adverse inference as facts otherwise available in computing Mueller’s dumping margin.View "Mueller Comercial de Mexico v. United States" on Justia Law

Deckers imports Teva® Sports Sandals from Hong Kong. The sandals at issue do not have fully-enclosed uppers, but have rubber or plastic soles and cloth or textile straps; the toe and heel sections are open, and the upper sections do not fully enclose the foot. The Sports Sandals are intended to be used for athletic pursuits, such as running, jogging, hiking, canyoneering, and a variety of water-based activities. U.S. Customs and Border Protection Service liquidated the sandals under subheading 6404.19.35, of the Harmonized Tariff Schedule of the U.S. as: Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of textile material: Footwear with outer soles of rubber or plastics: Subheading 6404.19.35 is a “basket” provision for classification if merchandise cannot be classified under a more specific subheading in heading 6404. Products so classified are subject to a duty of 37.5% ad valorem. Deckers filed a protest, requesting that the Sport Sandals be classified as either 6404.11.80, or 6404.11.90, which included “sports footwear; tennis shoes, basketball shoes, gym shoes, training shoes and the like.” Deckers brought a test case before the Court of International Trade, which held that the Sports Sandals should be classified under subheading 6404.19.35. The Federal Circuit affirmed. The Trade Court declined to reopen; the Federal Circuit affirmed.View "Deckers Corp. v. United States" on Justia Law

uPI and Richtek design and sell DC-DC controllers that convert direct current from one voltage to another, and are embodied in chips for downstream devices such as computer motherboards. uPI was founded by former Richtek employees; its chips are imported into the U.S. either directly or as incorporated in downstream devices. Richtek complained to the International Trade Commission that uPI misappropriated Richtek’s trade secrets and infringed Richtek’s U.S. patents, in violation of the Tariff Act, 19 U.S.C. 1337. uPI offered to enter into a consent order and to cease importation of products produced using or containing Richtek’s trade secrets or infringing Richtek’s patents. Over Richtek’s objection, the ALJ entered the consent order substantially as drafted by uPI. The Commission terminated the investigation. A year later Richtek filed an Enforcement Complaint. An ALJ distinguished between products that were accused in the prior investigation and products allegedly developed and produced after entry of the Consent Order, finding violations as to the formerly accused products and that the post- Consent Order products infringed two patents, but were independently developed and not produced using Richtek’s trade secrets. The Commission affirmed with respect to the formerly accused products and reversed in part with respect to the post-Order products. The Federal Circuit affirmed concerning the formerly accused products, but reversed the ruling of no violation as to the post-Consent Order products.View "UPI Semiconductor Corp. v. Int'l Trade Comm'n" on Justia Law

In 2010, at the request of domestic interested parties, the Department of Commerce initiated review under 19 U.S.C. 1675(a) on an outstanding antidumping duty order on stainless steel bar from India 2009-2010 and issued Mukand questionnaires to obtain product-specific cost information necessary to calculate Mukand’s dumping margin and ensure that comparison of similar products. Mukand’s response assigned the same production costs across all product sizes. Commerce informed Mukand that it did not consider this approach reasonable and asked that Mukand produce size-specific information, regardless of whether it normally tracked such information or to “quantify and explain” any reasons for believing that size-based cost differentials are insignificant. Mukand responded with a brief statement that where product grade and type of finishing operation are the same, direct material costs do not vary with size. After a fourth questionnaire, Mukand still declined to report size-specific costs, but never contacted Commerce for clarification or assistance. Commerce determined that Mukand’s responses were deficient, resorted to facts otherwise available, and applied an adverse inference against Mukand. The Court of International Trade and Federal Circuit affirmed. Without cost data broken down by product size, Commerce was unable to differentiate between different types of steel bar products and could not calculate an accurate constructed value for any of Mukand’s products. View "Mukand, Ltd. v. United States" on Justia Law

Trek was the importer of record for 72 entries of men’s suits in 2004. Mercantile was the consignee. Shadadpuri is president and sole shareholder of Trek, and a 40% shareholder of Mercantile. Trek and Mercantile provided fabric “assists” to manufacturers outside the U. S. (items incorporated in the imported merchandise, 19 U.S.C. 1401a(h)(1)(A)(i)). Customs determined that the entry documentation failed to include the cost of the fabric assists in the price paid for the suits which lowered the amount of duty payable by Trek. Shadadpuri had previously failed to include assists in entry declarations when acting on behalf of a corporate importer. The Court of International Trade found Shadadpuri liable for gross negligence in connection with the entry of imported merchandise and imposed penalties under 19 U.S.C. 1592(c)(2). The Federal Circuit reversed the penalty, but, on rehearing en banc, affirmed. What Shadadpuri did comes within the commonsense understanding of the “introduce” language of the statute. While suits invoiced to one company were in transit, he “caused the shipments of the imported merchandise to be transferred” to Trek. Himself and through his aides, he sent invoices to the customs broker for use in completing the entry filings to secure release of the merchandise into U.S. commerce. Applying the statute to Shadadpuri does not require piercing the corporate veil. View "United States v. Trek Leather, Inc." on Justia Law

CPZ imported tapered roller bearings by selling them to an unaffiliated U.S. importer, which then sold them to CPZ’s U.S. affiliate which resold them to unaffiliated U.S. customers. The Department of Commerce requested that CPZ identify whether its sales were export price (EP) sales or constructed export price (CEP) sales for purposes of calculating CPZ’s antidumping duty margin. CPZ provided CEP data. It did not provide EP data. Timken, an intervening domestic bearing producer, urged Commerce to calculate CPZ’s margin on an EP basis. Commerce did not require CPZ to submit the EP data, but calculated CPZ’s margin on a CEP basis, using the data provided. After Commerce issued the Preliminary Results, Timken again submitted comments. In its Final Results, Commerce changed course and calculated CPZ’s margin on an EP basis, using limited EP data previously provided, relating to a small subset of the imported bearings. Commerce calculated a margin of 92.84%. The Court of International Trade remanded. On remand, Commerce twice requested EP data. CPZ responded that it had been sold and the new owners had not maintained that data. After a second remand, under protest, Commerce calculated a 6.52% margin using the CEP data, without applying adverse facts available. The Court of International Trade affirmed. The Federal Circuit vacated. Commerce’s application of adverse facts available in its First Remand Redetermination was supported by substantial evidence; the Trade Court should reinstate Commerce’s application of adverse facts available and its calculation of CPZ’s margin in its First Remand Redetermination. View "Peer Bearing Co. - Changshan v. United States" on Justia Law

The Department of Commerce sets cash deposit rates associated with imported goods to curb “dumping,” i.e., exporting goods far below typical market prices, 19 U.S.C. 1673e(a)(3). Commerce found that a U.S. industry was threatened with material injury by reason of imports of certain cased pencils from China, imposed anti-dumping duties, and later initiated administrative reviews for 2008-2009 and 2009-2010. During the 2008-2009 review period, Michaels imported cased pencils manufactured by three producers in China and exported by three different exporters. The producers participated in the review process, but two withdrew. None of the Chinese exporters participated. The producers’ rates were established for the two review periods. Commerce assigned Michaels’ exporters a country-wide anti-dumping cash deposit rate, as opposed to lower rates obtained by the pencils’ producers. Michaels argued that it was entitled to the producer rate based on 19 C.F.R. 351.107(b)(2), which states that “if the Secretary has not established previously a combination cash deposit rate . . . for the exporter and producer in question or a noncombination rate for the exporter in question, the Secretary will apply the cash deposit rate established for the producer.” The Federal Circuit affirmed, reasoning that section 351.107(b)(2) is informed by section 351.107(d), which establishes an initial noncombination rate for all producers and exporters in nonmarket economy countries. View "Michaels Stores, Inc. v. United States" on Justia Law

The Department of Commerce conducted new shipper review, at Sea-line’s request, on an outstanding 1994 antidumping order on fresh garlic imports from China. New shipper review covers an importer or producer that was not subject to an initial antidumping duty investigation and thinks it is entitled to an individual anti-dumping duty margin, 19 U.S.C. 1675(a)(2), and covers imports after the review period for the initial investigation. Commerce conducted Sea-line’s review for the period of November 1, 2008 through April 30, 2009. Because China is a non-market economy, Commerce used surrogate values from a comparable market economy (India), relying on price data from the APMC Bulletin, which reports daily prices in India for garlic bulbs of various “grades.” Sea-line reported bulbs in the grade Super A category. The APMC Bulletin did not report any prices for grade Super A bulbs for the period of review. Commerce averaged the closest available data points for grade Super A garlic, which was for November 2007 through April 2008 and applied the Wholesale Price Index for India published by the International Monetary Fund. Commerce calculated a “surrogate financial ratio” for general expenses, overhead, and profit by averaging financial statements of two Indian tea producers, reasoning that "tea, rice, and vegetable processing is similar to garlic because each is not highly processed or preserved prior to sale.” The Court of International Trade affirmed the final results and assignment of an antidumping duty. The Federal Circuit affirmed, finding that the results were based on substantial evidence.View "Qingdao Sea-line Trading Co. v. United States" on Justia Law

GRK’s R4 Screws, RT Composite Trim Head Screws, and Fin/Trim Head Screws are made with corrosion-resistant case-hardened steel and are marketed for use as building material fasteners. R4 screws have a flat self- countersinking head designed to cut away at the top layer of the material as the screw is driven into place. RT and Fin/Trim screws are recommended for fine carpentry and trim applications, and have much smaller heads, designed to prevent cracking and splitting of the target material. GRK imported the subject screws between January and August 2008. U.S. Customs and Border Protection classified the screws at liquidation under the Harmonized Tariff Schedule of the U.S. (HTSUS) subheading 7318.12.00, “other wood screws,” which carries a 12.5% ad valorem duty. GRK protested, claiming that the screws should instead have been classified under subheading 7318.14.10, “self-tapping screws,” subject to a 6.2% ad valorem duty. Customs denied GRK’s protests. The Court of International Trade noted that HTSUS does not specifically define either subheading and agreed with GRK that the items were properly classified as “self-tapping screws.” The Federal Circuit vacated and remanded, reasoning that the Trade Court refused to consider the use of the screws at any step of determining the classification. View "GRK Canada, Ltd. v. United States" on Justia Law

The Department of Commerce initiated a CVD investigation, 19 U.S.C. 1671(a), on multi-layered wood flooring from China in response to a petition from domestic producers, limiting its individual examination to companies accounting for the largest volume of imports, and selected Fine Furniture as a mandatory respondent. Commerce sent out questionnaires to analyze an allegation that the government of China subsidized the respondents’ electricity costs. Among other things, Commerce sought draft provincial price proposals for 2006 and 2008 for each province in which the mandatory respondents were located. Fine Furniture provided all of the requested information, while the government of China did not. Commerce determined that the government of China’s decision not to provide information about how electricity rates were determined for each province in which mandatory respondents were located was a failure to cooperate to the best of its ability. Accordingly, Commerce applied an adverse inference to find that the Electricity Program provided a financial contribution specific to the identified respondents. Commerce also applied adverse inferences to determine the benchmark price for electricity. The Court of International Trade held that Commerce did not apply adverse inferences against Fine Furniture, but applied adverse inferences as its method for determining the information requested from, but not provided by, the government of China. The Federal Circuit affirmed. View "Fine Furniture Ltd. v. United States" on Justia Law