Trade Court Denies Bid for Injunction on Cash Deposits, Liquidation in Countervailing Duty Case

The Court of International Trade in a June 9 opinion denied Indian exporter Gujarat Fluorochemicals Limited's (GFL's) bid for injunctive relief against liquidation and paying cash deposits from a countervailing duty investigation. Judge Timothy Stanceu ruled that the plaintiff failed to show that it would likely face harm without the preliminary injunction since the company failed to show that future refunds of excess cash deposits would be an "inadequate remedy." As for the injunction on liquidation, the court said that there's no draft order in "satisfactory form" that could allow the court to issue the standard injunction against liquidation. However, Stanceu gave the plaintiff 30 days to renew the injunction bid.

The case concerns the countervailing duty investigation on granular polytetrafluoroethylene from India. After bringing its case to the trade court, GFL moved for an injunction that would halt the collection of cash deposits on the relevant entries at the 31.89% CVD rate and instead collect cash deposits at the 4.75% rate Commerce calculated in the investigation's preliminary determination. The exporter also sought an injunction against liquidation of the entries during litigation.

Stanceu denied the injunction bid for both the cash deposits and liquidation. On the cash deposit question, the judge said that establishing that a movant is likely to face harm without the relief is a prerequisite for granting the injunction. On that front, Stanceu ruled that GFL failed. The exporter argued that it was likely to face a host of consequences as a result of the higher cash deposit rates including lost business opportunities, an inability to pass on costs, business uncertainty, decreased demand and the threat of lost revenues.

But even assuming these consequences were true, "the court must conclude that plaintiff has not made allegations of likely harm sufficient to entitle it to the preliminary injunction it seeks," the opinion said. "The types of harm plaintiff alleges are not unlike those that reasonably could be expected to occur in a typical countervailing duty investigation involving a similar cash deposit rate. Plaintiff has not put forth allegations sufficient to cause the court to conclude that the prospect of future refunds of excess cash deposits for importers of record, along with a lower deposit rate at that time, will be an inadequate remedy under the statutory scheme." Stanceu also denied the bid because the plaintiff is an exporter and so does not have to pay the cash deposit rates.

As for the injunction motion against liquidation, the judge said that while these motions are typically granted, the plaintiff did not present a draft order in "satisfactory form." In its draft order, GFL said that it seeks an inunction against liquidation of its unliquidated entries subject to the CVD order. "It is not clear what is meant by 'Plaintiff’s unliquidated entries': it is not apparent that plaintiff could have its own entries, and the reference might mean either entries of merchandise produced by plaintiff, or of merchandise exported by plaintiff," the opinion said. "There is no attempt to specify the technical parameters that are addressed in USCIT Form 24."

Since GFL has not submitted any other documents clarifying its motion, the judge denied the request for an injunction. However, Stanceu gave GFL another 30 days to renew its motion and tell the court whether it consents to the U.S.'s draft injunction which would run until the end of the first administrative review period.

(Gujarat Fluorochemicals Limited v. U.S., Slip Op. 22-63, CIT #22-00120, dated 06/09/22, Judge Timothy Stanceu. Attorneys: John Gurley of ArentFox for plaintiff GFL; Daniel Roland for defendant U.S. government; Luke Meisner of Schagrin Associates for defendant-intervenor Daikin America)