Raising Verification Concern Administratively 'Futile,' AD Petitioner Says in Reconsideration Bid at CIT

Plaintiffs in an antidumping duty case, led by Ellwood Cit y Forge Company, filed for a reconsideration of a Court of International Trade opinion that found that they failed to exhaust their administrative remedies when challenging the Commerce Department's decision to issue a questionnaire in lieu of on-site verification due to COVID-19 travel restrictions. The reconsideration bid argued that Commerce's remand results in a separate antidumping case revealed how futile raising the point administratively would have been, and that in light of these new facts, the court should reconsider its ruling (Ellwood City Forge Company v. United States, CIT #21-00073).

The case concerns the antidumping duty investigation on forged steel fluid end blocks from Italy. During the investigation, Commerce said it was unable to conduct on-site verification due to COVID-19 travel restrictions. Ellwood City challenged the lack of verification at CIT (see 2201200032). The U.S. argued that since Ellwood City failed to raise this question during the investigation, the matter should be tossed.

Judge Stephen Vaden found that the issue was not raised administratively and thus should be dismissed (see 2206140044). "Ellwood City did not challenge Commerce’s failure to perform an on-site verification during the pendency of the administrative proceeding, much less include the argument in its final brief before the agency as required by regulation," the opinion said. "Instead, it complimented the agency for its verification procedures -- until those procedures resulted in a final determination not to Ellwood City’s liking."

The judge also addressed the question of futility -- whether raising the verification question administratively would have proved futile and thus open up the challenge for judicial review. Vaden said that it is "far from 'obvious that the presentation of [Ellwood City's] arguments to the agency would have been pointless,'" and thus the plaintiffs failed to clear the bar of proving futility.

In recent remand results in another AD case contesting the same thing, Commerce stuck with its use of the questionnaire in lieu of on-site verification (see 2207050070). The agency said that the petitioner in that case, Bonney Forge, raised the issue too late, since it brought up its issues with the questionnaire with only 63 days to go until the final determination was released. The plaintiffs in the present case now argue that if 63 days wasn't enough, then 48 days -- the window between plaintiffs' submission of their administrative case brief and the final determination -- certainly wasn't enough, meaning it would have been futile to raise the point before Commerce.

"The Opinion’s conclusion, that it was 'far from ‘obvious that the presentation of [Ellwood City's] arguments to the agency would have been pointless,’ ... thus overlooks key facts," the brief said. "Accordingly, reconsideration of the futility exception’s applicability is warranted. To deny futility here perversely incentivizes Commerce to spring unlawful procedural changes on parties too late in an administrative proceeding to change course. But this does not serve 'administrative regularity.'"