CIT Remand Holds ITA to Prior Scope Rulings in China Hand Trucks Case

The Court of International Trade remanded an International Trade Administration determination that a model of telescoping utility cart exported by plaintiff Welcom Products falls within the scope of the antidumping duty order on hand trucks from China (A-570-891). The ITA didn’t adequately explain its reasoning for ruling that the model at issue is within scope, in light of a 2008 scope determination that a similar model is not, CIT said. CIT also sustained two ITA determinations that other models of utility carts exported by Welcom are not in scope, despite a challenge from defendant-intervenors Gleason.

In 2004, during the investigation of hand trucks from China, the ITA ruled that the “Magna Cart” utility cart exported by Welcom wouldn’t be subject to the order because of an exclusion for utility carts for carrying luggage with a frame made from telescoping tubes measuring less than 5/8 of an inch in diameter. The frame of the Magna Cart wasn’t exclusively made of telescoping tubes, but the ITA said the exclusion doesn’t say the entire frame has to be. The ITA relied on its 2004 scope determination in a similar 2008 ruling that Welcom’s MCX model utility cart is also excluded, even though only one of the three telescoping tubes in the frame was under 5/8 of an inch. In 2011, however, the ITA ruled that the MCK model (similar to the MCX) is included in the scope because not all of the telescoping segments in its frame are under 5/8 of an inch.

Welcom argued that the ITA overturned its 2008 scope ruling without providing adequate reasoning for its change in position. Even though the MCK model was nearly identical to the MCX model, the ITA changed its position on whether all telescoping segments have to be under 5/8 of an inch.

CIT agreed, saying “the interpretation of the scope language in the later rulings may not be reversed absent a reasoned basis for the change.” CIT said the single most important factor the ITA must rely on in scope determinations is what it had decided in prior scope determinations, and that its change in position without an adequate explanation was “arbitrary and capricious.” Furthermore, said CIT, the ITA did not give adequate weight to Welcom’s arguments that the International Trade Commission didn’t investigate for injury to U.S. industry by imports of utility carts for luggage in the original investigation.

(Welcom Products, Inc. v. United States, Slip Op. 12-124, dated 09/27/12, Judge Musgrave)

(Attorneys: Kevin Horgan of deKieffer & Horgan for plaintiff Welcom; Joshua Korland for defendant U.S. Government; Matthew Jaffe of Neville Peterson for defendant-intervenors Gleason and Precision Products)