CAFC Grants Jurisdiction to Challenge AD Final Determinations Under Suspension Agreements

Companies have the right to judicially challenge an antidumping duty investigation's final determination even if it is subject to a suspension agreement, the U.S. Court of Appeals for the Federal Circuit said in a series of four opinions on April 14. The court issued the opinions together as they all pertain to the same antidumping investigation on Mexican tomatoes. While the appellate court sent the cases back establishing jurisdiction for the claims against the AD investigation's final determination, the court did dismiss some claims against the termination of a prior suspension agreement and the new suspension agreement.

In 1996, an agreement was struck to suspend the antidumping duty investigation on tomatoes from Mexico, requiring signatories to sell their goods in the U.S. at minimum reference prices. Successive agreements were made in 2002, 2008 and 2013. However, in 2019, the Commerce Department withdrew from the 2013 agreement, continuing the AD investigation. Before an AD order could be imposed, though, a new suspension agreement was struck with higher minimum reference prices requiring dumping margins not to exceed 15%. U.S. tomato producers asked Commerce to continue the investigation, however, leading to the agency releasing a final determination finding that dumping was occurring.

This episode led to the four cases for which the Federal Circuit ultimately issued opinions on April 14. In one of the cases, filed by a collective of five U.S. tomato producers called Red Sun Farms, the plaintiff filed seven claims all challenging the investigation's final determination. The Court of International Trade in this case said that it did not have jurisdiction to hear the claims and that the claims were premature since the suspension agreement was still in place, precluding review of the final determination.

The Federal Circuit reversed this judgment, ruling that since the plaintiff's claims include "present, concrete interest of exporters bound by the suspension agreement," the claims are not premature. The lawsuit could result in a complete elimination of the antidumping duties. CIT also said that the case should be tossed since it must have been filed within 30 days of the publication of the suspension agreement and not the final determination. This would have led to a requirement that any would-be plaintiff file a placeholder suit, whereby amendments to the complaints would be made later to challenge the final determination.

The Federal Circuit disagreed, holding that it would have led to "an awkward fit with the timing requirements of the statute." This ruling would require litigants that might want to challenge a final determination without even knowing the results of the final determination to file a case within 30 days of the agreement's publication.

In the Red Sun Farms opinion, the Federal Circuit further remanded the matter to find whether the plaintiff had standing to sue as it is five companies rolled up into one and whether Red Sun Farms can be named as the lone plaintiff. The Red Sun Farms decision also came with a dissent from Judge Timothy Dyk, who held that it is unlikely Congress intended for lawsuits to be filed that challenge a final determination unrelated to the suspension agreement.

The second opinion, filed by plaintiffs led by Bioparques de Occidente, concerned a case with claims over the termination of the 2013 agreement, the continuation of the investigation and the final determination. Again reversing CIT's ruling that no jurisdiction existed for the final determination claims, the Federal Circuit did so this time under a new premise: that Supreme Court precedent permits the challenge. The appellate court said the plaintiffs' interests were "far from speculative" and that under precedent from a key court case, "which allowed the plaintiff to challenge the basis for patent liability without withdrawing from the license agreement, Bioparques need not withdraw from the 2019 Agreement, exposing itself to greater liability (through the issuance of an antidumping order)" to challenge the final determination.

The third opinion, filed by plaintiffs led by Confederacion de Asociaciones Agricolas del Estado de Sinaloa (CAADES), touched on the parties' challenges to the termination of the 2013 suspension agreement and the 2019 agreement. Departing from the CIT ruling, the Federal Circuit said that the requested relief via reinstating the 2013 agreement could be achieved, but that the claims fail on the merits.

CAADES' arguments, in part, claim that the 2013 agreement was wrongly terminated based on "improper political influence," influenced by various U.S. politicians' requests, including one from Sen. Marco Rubio, R-Fla., that the agreement be terminated. The Federal Circuit countered that there was no impropriety in the proceedings since any interested party can publicly request agency action. "It does not constitute an attempt to influence agency action by considerations other than the merit or lack of merit of the proposed action and the effects on interested parties," the opinion said. "So too, there is also nothing on the face of the agency decision to suggest that it was based on any impropriety. Speculation as to improper motive provides no basis to look behind Commerce’s stated reason for withdrawal."

As for CAADES' claims against the 2019 agreement, the court said that the plaintiff failed to state a claim for which relief can be granted. CAADES said that it was coerced into signing the agreement. "The alleged coercion here was the resumption of the investigation, which according to CAADES was unlawful because the termination of the 2013 agreement was not in accordance with the statute or was a breach of contract," the opinion said. "As we have discussed, the government’s termination of the 2013 agreement did not violate a statute or regulation. Nor was it invalid on grounds of improper political influence." As a result, the Federal Circuit tossed the claim.

The last case, brought by Jem D International (Michigan) Inc. and others, is the only non-precedential opinion of the group of cases. Jem D challenged the final determination, the continuation of the antidumping proceeding and the 2019 agreement. As the court ruled in the other cases, the court has jurisdiction over the final determination challenge but it does not have jurisdiction over the interim challenge. As for the 2019 agreement claims, the Federal Circuit said that while Jem D does not make a duress claim like CAADES, its summons was untimely filed and must be dismissed.

(Red Sun Farms v. United States, Fed. Cir. #20-2230, dated 04/14/22, Judges Timothy Dyk, Sharon Prost and Richard Taranto. Attorneys: James Durling of Curtis Mallet-Prevost for plaintiff-appellant; Douglas Edelschick for defendant-appellee U.S. government)

(Bioparques de Occidente v. United States, Fed. Cir. #20-2265, dated 04/14/22, Judges Timothy Dyk, Sharon Prost and Richard Taranto. Attorneys: Jeffrey Winton of Winton & Chapman for plaintiffs-appellants; Douglas Edelschick for defendant-appellee U.S. government)

(Confederacion de Asociaciones Agricolas del Estado de Sinaloa v. United States, Fed. Cir. #20-2232, dated 04/14/22, Judges Timothy Dyk, Sharon Prost and Richard Taranto. Attorneys: Devin Sikes of Akin Gump for plaintiffs-appellants; Douglas Edelschick for defendant-appellee U.S. government)

(Jem D International (Michigan) Inc. USA v. United States, Fed. Cir. #21-1292, dated 04/14/22, Judges Timothy Dyk, Sharon Prost and Richard Taranto. Attorneys: James Durling of Curtis Mallet-Prevost for plaintiffs-appellants; Douglas Edelschick for defendant-appellee U.S. government)