April 12 Status Report to Plot How Section 301 Litigation Moves Forward

Few surprises emerged in the latest procedural order Wednesday, in which the three-judge panel presiding over the massive Section 301 litigation inundating the U.S. Court of International Trade order dispensed with most of the last remaining case management housekeeping items (see 2103310062). The order enables the true litigation to get started, after months of delay. Importers are suing to vacate the List 3 and 4A tariff rulemakings on Chinese imports and get the paid duties refunded, alleging violations of the 1974 Trade Act and 1946 Administrative Procedure Act (APA).

The panel chose the first-filed complaint from HMTX Industries and Jasco Products as the single sample case and seated the 15-member plaintiffs steering committee, both in accordance with what Akin Gump proposed in its March 19 “coordinated” filing, with no outright dissent from the other plaintiffs. The judges ordered plaintiffs to confer with DOJ on a joint status report to be filed by April 12. That the report is due in under two weeks likely signals the court’s intent to now move the litigation along as expeditiously as possible.

The two sides in the joint status report “must identify any additional issues requiring early case management intervention and include a joint proposal for addressing any such issues to the extent possible,” said the order. If the steering committee and DOJ “are unable to agree on a proposal, the status report should identify the position of each side and the basis for any disagreement,” it said. It held open the possibility of convening a video “status conference.”

Discord remains between the two sides over refund relief. Plaintiffs want DOJ to stipulate support for a refund remedy on all tariffed imports, regardless of the goods’ liquidation status, if they prevail in the litigation. DOJ balked at the stipulation, but the order said the government hasn't formally opposed refunds, nor have the plaintiffs filed a motion for the court to impose them. The judges ordered the parties to “continue their consultations.”

In picking HMTX-Jasco as the sample case, Wednesday’s order stayed the thousands of other complaints, freezing them in place until the sample case is resolved. Lawyers are free to file motions with the court to get their cases lifted from the stay, said the order, but they must consult with the steering committee at least three days before doing so, and their motions must show “good cause.” Nothing prevents a stayed complaint from being amended "as a matter of course or with the court’s leave or the opposing parties’ consent," said the three-judge panel in a new procedural order Thursday.

Lawyers of the stayed cases can take part in the HMTX-Jasco litigation by filing amicus briefs, the court said in an earlier procedural order. That exposed a technical disagreement between DOJ, which wants the briefs restricted to nonsubstantive items, and plaintiffs, who desire wider latitude. The debate appears unresolved.

The joint status report due April 12 must contain a proposed briefing schedule, said the order. It’s expected to lay out the timeline for cross-motions and responses in which each side seeks summary judgment in the case.

Though Wednesday’s procedural order didn’t mention it, the joint status report likely will propose a date for DOJ’s release of the administrative record in the case. The record would contain documents the government must produce under the APA that are germane to the agency's decision-making on the List 3 and 4A tariffs. Courts have inconsistently applied the APA’s administrative record component, some requiring expansive release of internal agency documents, others more restrictive, said a March 2020 University of California, Irvine white paper.

In a February order, the three-judge panel said some parties support a “limited” administrative record in the case, apparently not just from the government side. Lawyers told us some plaintiffs expressed little appetite for engaging with DOJ in a protracted fight over administrative record documents if it means prolonging the litigation unnecessarily. Said one attorney of his importer clients: “They just want their money back.”