CIT Denies Lumber Trade Group Right to Intervene in Case Over Whether to Start CCR in CVD Case

The Committee Overseeing Action for Lumber International Trade Investigations or Negotiations will not be allowed to intervene in GreenFirst Forest Products' case at the Court of International Trade contesting the Commerce Department's decision not to start a changed circumstances review. Per a May 20 opinion at CIT, Judge Claire Kelly said the coalition failed to show that it has a "direct, immediate, or legally protectable interest in this case" or that the U.S. will not adequately represent its interests.

The case concerns the countervailing duty order on softwood lumber from Canada. During the investigation and the first three administrative reviews, Rayonier A.M. Canada was never individually examined but received a non-selected company rate of 6.32%. In 2021, however, GreenFirst acquired all of RYAM's lumber and newsprint operations, leading GreenFirst to request a CCR. Commerce rejected the bid to open the review, citing its significant change practice.

The agency presumed there had been a change that could've affected the nature and level of subsidization. But GreenFirst said RYAM's rate was not based on its level of subsidization. GreenFirst then filed suit at CIT to contest the decision not to start a CCR (see 2203280058). The coalition sought to intervene in that action, arguing that it has an interest in stopping GreenFirst from getting a lower cash deposit rate than the "all-others" cash deposit rate. GreenFirst opposed this bid, telling the trade court that the issue of a lower cash deposit rate for GreenFirst is not at issue before the court since Commerce never reached that issue (see 2205060001).

In assessing the motion to intervene, Kelly said that the court will grant a bid to intervene when the motion is timely, the party asserts a legally protectable interest in the property at issue, the interest is of a "direct and immediate character" that the party will either gain or lose by "direct legal operation" from the judgment, and the interest will not be adequately represented by the government. While the motion was timely filed, the judge found that the coalition failed on the remaining three grounds.

To establish its interest in the property at issue, the coalition said that it had a "participatory interest" based on its participation in the proceedings, a "beneficiary interest" in enforcing the CVD order, an "economic interest" in ensuring GreenFirst pays the all-others rate rather than RYAM's most recent rate, and an "interest in protecting the integrity of Commerce's CCR procedures. But Kelly was not buying the explanations.

"The COALITION does not have a legally protectable interest in this action because this action is limited to the question of whether Commerce arbitrarily or capriciously decided not to conduct a CCR," the opinion said. "The only relief GreenFirst stands to gain in this action is an order remanding Commerce’s decision not to conduct a CCR. Thus, even assuming the COALITION has the interests it claims to have, the COALITION fails to reconcile its purported interests in this action with what GreenFirst seeks." Kelly sided with GreenFirst in the plaintiff's arguments claiming that the coalition seeks to enter a case that doesn't exist.

And while the coalition may have an interest in protecting the integrity of Commerce's CCR procedures against manipulation, the only issue in the present case was over whether to initiate a CCR at all, not any alleged manipulation, the judge pointed out. "Indeed, GreenFirst’s cash deposit rate will remain unchanged regardless of the outcome of this action."

Kelly also addressed the prospect of permissive intervention, which the coalition argues for since it "shares a common defense" with the U.S. "However, the COALITION fails to adequately demonstrate that it shares a defense to GreenFirst’s claims because it does not sufficiently allege that it will be adversely affected or aggrieved by a decision in this action," the opinion said. "... Simply mimicking the Defendant’s defense of its own interest falls short of this standard."

(GreenFirst Forest Products Inc., et al. v. United States, Slip Op. 22-52, CIT #22-00097, dated 05/20/22, Judge Claire Kelly. Attorneys: Zachary Walker of Picard Kentz for proposed defendant-intervenor; Sarah Shulman of Cassidy Levy for plaintiffs)