AD/CVD Court Decisions in the First Half of Feb 2010

The following determinations of the Court of International Trade and the Court of Appeals for the Federal Circuit in the first half of February 2010 involved antidumping or countervailing duty law.

AD Rate Changes Due to WTO Recommendation on "Zeroing" Not Retroactive

Following a WTO panel recommendation that the U.S. not use zeroing to exclude prices that are higher in the U.S. than in the comparison market from the dumping calculation, the U.S. Trade Representative on January 16, 2009 directed the ITA to revise its investigation results for frozen warmwater shrimp from Thailand. Under a Uruguay Round Agreements Act Section 129 determination¹, the ITA gave Andaman Seafood a de minimis AD rate and revoked its AD order. Andaman then sued to prevent the ITA from assessing AD rates on unliquidated entries it had made prior to the USTR directive. The court ruled against Andaman, agreeing with the ITA that the Section 129 determination results should apply from the date of the USTR directive onwards, but not retroactively.¹

Korean Steel Makers Fail in "Zeroing" Challenge in AD Reviews

Dongbu Steel and Union Steel sued over the use of zeroing in the final results of the AD duty administrative review for corrosion-resistant carbon steel flat products from Korea for the period August 1, 2004 through July 31, 2005, arguing that since the ITA had ceased the practice in AD investigations, it should do so in reviews, too. While acknowledging that the World Trade Organization has repeatedly faulted zeroing, the CIT cited "the long and unbroken line of decisions" upholding the practice, and once again held that it is permitted by statute. ²

New Review Not Needed for Revoked Order on Malaysia Extruded Rubber Thread

When the ITA revoked the AD duty order for Malaysian extruded rubber thread producer/exporter Heveafil following a changed circumstance review, it set the effective date at October 2, 2003 as requested by the trustees for the defunct U.S. producer North America Rubber Thread and not October 1, 1995, the date sought by the foreign producer. Later, both parties together requested a new review, seeking the earlier revocation date after all, and sued the ITA when it declined to initiate a new review. The Court of Appeals for the Federal Circuit vacated a CIT decision in favor of a second review, ruling that separate CIT litigation now underway gives Heveafil a means to pursue the date change, and that the U.S. producers' trustees, for their part, could not legally make arguments opposite to those they successfully made before.³

On Third Try, Court Approves ITA Approach in Stainless Butt Weld from Pipe Fittings from Taiwan

Following the AD administrative review for stainless steel butt-weld pipe fittings from Taiwan for the period June 1, 2005 to May 31, 2006, the CIT twice ordered the ITA to justify and explain aspects of its calculations of U.S. selling expenses and profit adjustments. With the second remand results, the court found the agency's additional explanations sufficient to support its approach.⁴

Court Upholds Alternative Adverse AD Rate for Chinese Crawfish Exporter

After the ITA assigned a 223.01% adverse AD rate to a Chinese crawfish tail meat exporter for attempting to conceal a significant portion of its U.S. sales during the AD administrative review period September 1, 2005 through August 31, 2006, the exporter's surety provider sued, and won a remand from the CIT ordering the ITA to recalculate an adverse AD duty rate better supported by record evidence. Now the CIT has upheld the remand results, which are based on alternative company-specific price data and give a rate of 188.52% to the exporter, Xuzhou Jinjiang Foodstuffs Co., Ltd.⁵

Lawyers' Tactics Faulted at CIT in Diamond Sawblades AD Litigation

Following the CIT's issuance of a mandamus order directing the ITC and the ITA, after multiple delays, to issue AD orders on diamond saw blades from China and Korea, a group of importers sought a stay pending an appeal of the ITC's injury determination, but the CIT ruled that the appeal was unlikely to win and ordered the ITA and the ITC to proceed. The domestic parties then sought to impose court sanctions and attorney's fee orders on the importers' counsel for filing an allegedly frivolous motion, and the importers' counsel sought the same from the domestic counsel for other reasons. However, the court denied the motions. Reprimanding counsel for both sides, the court took note of untimely filings, failure to serve opposing counsel, and the use of "arguments that stretch the bounds of zealous advocacy." ⁶

¹Section 129 of the URAA provides, among other things, that within 180 days of a written request from the U.S. Trade Representative, the ITA shall issue a determination that would render its actions not inconsistent with an adverse finding of a WTO panel or Appellate Body.

Andaman Seafood Co., Ltd., et al. v. U.S., dated February 2, 2010, available at http://www.cit.uscourts.gov/slip_op/Slip_op10/10-12.pdf. WTO dispute settlement panel summary available at http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds343_e.htm. (See ITT's Online Archives or 02/02/09 news, 09020235, for BP summary of the Section 129 determination; see ITT's Online Archives or 02/02/05 news, 05020240, for BP summary of the ITA's issuance of amended final AD rates and AD orders, after the AD investigation).

²Dongbu Steel Co., Ltd. and Union Steel Manufacturing Co., Ltd., v. U.S. et al, dated February 4, 2010, available at http://www.cit.uscourts.gov/slip_op/Slip_op10/10-13.pdf. (See ITT's Online Archives or 01/08/07 news, (Ref:07010825), for BP summary of the ITA's abandonment of zeroing in certain investigations.)

³Trustees in Bankruptcy of North American Rubber Thread Co., Inc. et al. v. U.S., dated February 1, 2010, available at http://www.cafc.uscourts.gov/opinions/09-1191.pdf. (See ITT's Online Archives or 08/25/04 news, (Ref:04082528), for BP summary of the ITA's revocation of the order for Heveafil.)

⁴Alloy Piping Products, Inc., et al, v. U.S. and Ta Chen Stainless Steel Pipe Co., Ltd., dated February 8, 2010, available at http://www.cit.uscourts.gov/slip_op/Slip_op10/10-15.pdf (See ITT's Online Archives or 05/22/2009 news, (Ref:09052250,) for BP summary of the court's first remand order; see ITT's Online Archives or 11/24/09 news (Ref. 09112440) for BP summary of court's second remand order.)

⁵Washington International Insurance Company v. U.S., dated February 9, 2010, available at http://www.cit.uscourts.gov/slip_op/Slip_op10/10-16%20errata.pdf (See ITT's Online Archives or 11/9/09 news (Ref:09110935), for BP summary of the earlier remand order.)

⁶Diamond Sawblades Manufacturers' Coalition v. U.S. et al., dated February 12, 2010, available at http://www.cit.uscourts.gov/slip_op/Slip_op10/10-17.pdf. (See ITT's Online Archives or 12/09/09 news, 09120955, for BP summary of the Court's prior instructions to the ITC and the ITA to proceed with executing the mandamus order.)