Amsted Amends Complaint in Conflict-of-Interest Suit to Include Alleged Ethics Breach

Plaintiffs in a conflict-of-interest suit against the Commerce Department at the Court of International Trade, led by Amsted Rail Co., amended their complaint after a similar case of theirs against the International Trade Commission was dismissed for lack of subject matter jurisdiction. The amended complaint added a specific alleged instance in which ARC gave its former counsel, Daniel Pickard, now of Buchanan Ingersoll, information that is now being used against it in antidumping and countervailing duty proceedings (Amsted Rail Co. v. United States, CIT #22-00316).

The case concerns past AD/CVD investigations on freight rail couplers and parts thereof from China and present AD/CVD investigations on the same goods from China and Mexico. ARC is a U.S. producer and importer of the subject merchandise, and is affiliated with a maquiladora factory, ASF-K -- the only Mexican manufacturer of the freight rail coupler systems. As a petitioner in the previous investigation, ARC originally employed Wiley Rein, where Pickard worked as a partner, to represent them. Pickard filed an AD/CVD petition on behalf of ARC and McConway and Torley (M&T).

ARC subsequently withdrew from the petition, leaving Pickard to carry on with M&T and a labor union in the industry. An administrative protective order (APO) in this investigation was then issued. Until its withdrawal, ARC disclosed confidential information to Pickard to help prepare for his case.

In the prior injury investigation, the International Trade Commission unanimously voted that the U.S. industry was not materially harmed by imports of the subject merchandise from China. But during the investigation, Pickard had moved from Wiley Rein to Buchanan Ingersoll. The ITC issued its injury determination in June, when the APO only covered Pickard and two non-attorneys at Wiley. After the determination, in July 2022, Buchanan then filed an amendment to the APO adding seven attorneys and two non-attorney personnel from Buchanan.

Days later, Buchanan filed a petition to start new AD/CVD investigations on the freight rail couplers, this time adding Mexico. These Buchanan lawyers included Mexican imports knowing that the only Mexican imports came from ARC's affiliate. Describing this as a "betrayal," ARC originally took to the ITC and Commerce to argue that Pickard and Buchanan should be disqualified from the proceeding and booted from the APO (see 2210120062). The plaintiffs then went to the trade court over the ITC's failure to toss Buchanan and Pickard from the APO (see 2210170084).

ARC and ASF-K filed another case at CIT, this time looking to get the trade court to have Commerce disqualify Buchanan from the AD/CVD investigations (see 2211020045). In the proceedings, the agency said it wouldn't make a finding as to whether the firm should be barred from further participation. Then, in ARC's case naming the ITC as a defendant, the trade court dismissed the action for lack of subject matter jurisdiction (see 2211160057). In that case, ARC then filed for an injunction pending an appeal of the decision, arguing that the court erred by illegally shifting the burden to the plaintiffs to identify specific times ARC shared confidential information with Pickard and Buchanan.

Determined not to have its case against Commerce dismissed on similar grounds, ARC amended the complaint to add a specific instance of Pickard allegedly using the importer's information against it. ARC said that when he was preparing the petition, Pickard contacted ARC's director of global trade compliance over why the values of freight rail coupler imports from China were so low. This employee said that this was likely due to Chinese-origin freight rail couplers entering Mexico and being attached to Mexican-made rail cars to be sent to the U.S. without reporting of the attached freight rail couplers. This employee, Jay Allan, gave Pickard information on how it does business with ASF-K.

"The very information Mr. Allan provided to the Attorney is now being used against ARC in the Current Investigation," the amended complaint said. "The scope of the Current Investigation includes FRCs attached to rail cars in Mexico that are then exported to the United States. This directly impacts ARC because a substantial amount of the FRC produced in Mexico are covered by the scope of the Current Investigation."