8th Amendment AD/CVD Case Contests CBP's Duty Collection, Not Commerce's Findings, Brief Says

The Court of International Trade should disregard the government's motion to dismiss steel importer Rimco's challenge to the antidumping and countervailing duties it paid, Rimco argued in a May 4 reply brief. Since the importer's case is really a constitutional challenge over excessive fines, Rimco argued that it properly filed its action as a response to CBP's assessment of the AD/CVD rather than the Commerce Department's calculations of the duties (Rimco v. United States, CIT #21-00537).

Rimco filed its case to contest the 457.10% countervailing duty rate and 231.70% China-wide antidumping duty rate on its steel wheel imports (see 2109240049). Both rates were imposed with an adverse inference. The importer said the duties were penal not remedial, in violation of the Eighth Amendment. This led DOJ to file a motion to dismiss -- a bid now supported by proposed defendant-intervenor Accuride. Rimco challenged CBP's imposition of the duties even though CBP has a ministerial role in administering AD/CVD. The U.S. and Accuride said this was the wrong jurisdiction for such a challenge and that the case should be challenging Commerce's determinations (see 2205040030).

The importer contested this characterization of its case in its reply brief, arguing instead that the lawsuit is not actually contesting Commerce's determinations. "Rather, this action addresses the effect of those determinations, mainly whether CBP’s assessment of charges pursuant to Commerce’s determinations has resulted in an unconstitutional 'excessive fine,'" the brief said. "We assert that it has."

In the motion to dismiss, the U.S. argued that Rimco failed to exhaust its administrative remedies at Commerce by not raising the excessive fines point earlier. Rimco said that this was unnecessary since there was no excessive fine until CBP took the importer's money. "Contrary to Defendant’s assertion, these issues could not have been raised before the Commerce Department in an action brought pursuant to 28 U.S.C. § 1581(c) because (1) the Commerce Department does not, in its activities under the Tariff Act, exact, demand or collect any monies; and (2) the Commerce Department is not competent to judge the constitutionality of its actions -- that is a function reserved to the Courts," the brief siad.

Fines that are being challenged as unconstitutional may be contested by protest, Rimco said. The importer cited a series of precedential opinions establishing that CBP's liquidation may be a "vehicle" for getting a court decision finding an act of Congress (i.e., excessive AD/CVD) is unconstitutional.

If the importer fails to establish jurisdiction for its case under a challenge to a CBP action, Rimco further pleaded that the case should fit under Section 1581(i), the court's "residual" jurisdiction. Such jurisdiction would exist since the case stems from a law providing for the imposition of duties other than for the purpose of raising revenue and since the case relates to the enforcement of matters covered by the laws adjudicated by the trade court, the brief said.