USMCA Panel Proper Home for Suit Over AD Cash Deposit Rate, DOJ Tells CIT in Motion to Dismiss

A Canadian exporter's challenge of antidumping cash deposit instructions should be dismissed since the company can obtain a review of the cash deposit rate through an already initiated USMCA panel review, DOJ said in a March 4 brief. What the exporter, J.D. Irving, really wants is to not pay current cash deposits at the current rate, DOJ told the Court of International Trade. Even if the court finds it does have jurisdiction over the cash deposit instructions, the case still should be dismissed since the payment of cash deposits doesn't establish standing since it isn't an injury, DOJ said (J.D. Irving Ltd. v. United States, CIT #21-00641).

The case concerns the instruction that follows the final results of the 2019 administrative review of the antidumping duty order on softwood lumber products from Canada. Neither J.D. Irving nor any U.S. lumber producer requested a review of the exporter for the 2020 period of review, yet Commerce replaced J.D. Irving's 2020 AD cash deposit rate with a dumping rate for the 2019 period. J.D. Irving took the matter to CIT arguing that this was illegal since the lack of a request for the 2020 review signaled that both sides agreed that the cash deposit rate in effect was an accurate measure of J.D. Irving's dumping level (see 2201050029).

DOJ then moved to dismiss the case for lack of subject-matter jurisdiction since relief can be provided through a current USMCA binational panel. J.D. Irving filed its case under CIT's Section 1581(i) "residual" jurisdiction, which can only be claimed if all other 1581 sections are "manifestly inadequate." DOJ said that "1581(c) jurisdiction is effectively available before the USMCA panel, and that panel can review the results of the second administrative review -- where J.D. Irving was assigned the 11.59 percent rate it now contests -- thus, any relief provided by the panel will not be manifestly inadequate.

"Indeed, USMCA’s dispute settlement provisions would be rendered a nullity if parties were able to ignore the statute and claim 1581(i) jurisdiction before this Court when another party requests panel review," it said. J.D. Irving has failed to show why relief through the USMCA panel review is inadequate just because it's a USMCA panel, the brief said. The U.S. argued that what the exporter really wants is to not pay the higher rate, attempting to use the "chronology and posture" of the matter as justification. "[B]ut nothing about the chronology is unusual -- it is frequently the case that parties receive a carried-over rate when no review is requested, even in the midst of a prior review," the brief said.

Further, payment of cash deposits is not an injury, so J.D. Irving does not have standing to sue, DOJ said. Cash deposits are estimates and any excess cash deposits are returned if the ultimate dumping liability is found to be less than the cash deposits paid, the U.S. pointed out. The trade court has repeatedly found that cash deposits don't create an injury sufficient to confer standing. "Far from being an 'injury,' this is no more than the same business decision that every importer must make when deciding whether to seek an administrative review of a period of review before results of a prior review are released," the brief said.