'Complex, Novel' Legal Issue Bars Expedited Litigation Schedule in WRO Case, DOJ Argues

Palm oil importer Virtus Nutrition's wish for an expedited briefing schedule has hit a snag, with the Department of Justice filing its opposition to the importer's application for an order directing the U.S. government to show cause why an expedited litigation schedule should not be entered in the Court of International Trade. Due to the case involving a "complex, novel legal issue" and a longer discovery period for the case, DOJ argued Virtus' request for a shortened litigation timeline should be nixed. The case involves Virtus' more than $2 million in palm oil imports from Malaysia held up by CBP over suspicions of having been made with forced labor, in violation of a Withhold Release Order (Virtus Nutrition, LLC v. United States, CIT # 21-00165).

In the case, Virtus wants a quick ruling from CIT since its imports of palm fatty acid distillate and palm stearin have been excluded from entry by CBP and have a shelf life of a year. Virtus is also paying a monthly storage fee for its products while its supply chain is searched for signs of forced labor. Virtus' products were held under a WRO that barred the entry of palm oil products made in Malaysia by Sime Darby Plantation Bhd on the grounds that the manufacturer's palm oil was made with forced labor. Virtus says that its palm oil is made by a different Malaysian producer, Wilmar (see 2105130055).

In its proposed briefing schedule, Virtus reduced DOJ's time to file a reply brief from 35 days to 10 days, prompting the government to dub the schedule "unworkable." In addition, Virtus is seeking a seriously truncated discovery period -- a change the government would not welcome. DOJ as a counter proposed 90 days to uncover the facts of the case, seeing as the central question will involve deposing witnesses, many of whom are located internationally, and acquiring documentation from foreign companies.

Since the question of whether Virtus' products were made with forced labor is a "novel, complex legal issue," according to DOJ, "the traceability of the merchandise involves a significant amount of fact-finding and documentation." Although Virtus has provided the government with some documentation on its supply chain, the government contends that the company has failed to provide sufficient documentation to establish “the source of the merchandise and of every component thereof to ascertain the character of labor used in the production of the merchandise and each of its components.” In particular, Virtus has not traced the production of its imports from the harvesting of the palm fruit to the production of crude palm oil to the refining of the oil into PFAD and palm stearin. DOJ's reply to Virtus' desire for an expedited schedule indicates how seriously the government is taking any determination that a good was made with forced labor.