CIT Tosses Suit Ostensibly Over Liquidation Instructions for Lack of Jurisdiction Under Section 1581(i)

The Court of International Trade in a Dec.12 opinion dismissed a suit from importer MS Solar Investments challenging the Commerce Department's liquidation instructions following an antidumping duty review for lack of subject matter jurisdiction. Judge Jennifer Choe-Groves said the case is based on an error affecting the final results of the review and not a mistake in the liquidation instructions. This means the case falls under Section 1581(c) and not Section 1581(i) -- the court's "residual" jurisidiction -- as claimed by the plaintiff.

In 2010 and early 2011, MS Solar bought 20 solar panels from Chinese exporter Yingli Green Energy Americas, 20 from Sun Earth Solar Power and 23 from Upsolar. The panels were originally shipped to Canada, but after the intended projects were canceled, the panels were sent to a storage facility in the Bahamas. They were then shipped to the U.S. in 2013. Commerce then undertook an administrative review of the AD order on solar panels from China, covering 2012-2013 entries.

MS Solar says it attempted to ensure that its imports of the stored panels wouldn't be subject to "an arbitrary and excessive antidumping duty rate." These measures included applying for an administrative review request, submitting a separate rate bid and working with Yingli to report to Commerce the pre-investigation sale of solar panels by Yingli to MS Solar, it said. Despite this, MS Solar was hit with the China-wide solar panel dumping rate instead of the Yingli review-specific rate.

MS Solar filed suit at CIT, where it originally asserted jurisdiction under Sections 1581(a) and 1581(i) because it was seeking "critical documents" from the U.S. at the time to elucidate which agency was responsible. MS Solar eventually obtained them via discovery. As a result, MS Solar amended its complaint to add its claims under 1581(i). Prior to, and after, amending the complaint, DOJ filed a motion to dismiss. MS Solar then defended against this motion, arguing that its qualm is with Commerce's liquidation instructions (see 2203030030).

The U.S., and now Choe-Groves, disagreed, finding that the true jurisdictional home of the suit is Section 1581(c). During the review, MS Solar said it asked Yingli to report "the single relevant sale to Commerce" to get the company-specific rate. The importer said it was aware that the exporter only mentioned the sale in a footnote in its questionnaire response, failing to include the MS Solar sale in its U.S. sales database. This error is what led to the importer paying the China-wide rate rather than Yingli's specific rate, Choe-Groves found.

"The Court concludes that Defendants’ characterization of the dispute, not Plaintiff’s, accurately reflects the true nature of the claim in this action," the opinion said. "The underlying issue in this case is an error in the record that influenced the Final Results, specifically the failure of Yingli to include information about MS Solar’s sale in Yingli’s U.S. sales database on the record. The true nature of the issue in dispute is not a problem with Commerce’s liquidation instructions or an error in Customs’ administration and enforcement, because Commerce’s failure to issue importer-specific liquidation instructions for the entries of subject merchandise exported by Yingli as reported in its U.S. sales database stems from an error in Yingli’s original reporting of information on the record."

The result is that the case does not fit under Section 1581(i) because relief under Section 1581(c) is not "manifestly inadequate," the judge said. Under Section 1581(c), the court could remand the issue to Commerce to reconsider the information over the sale reported in Yingli's U.S. sales database and "whether a corrected liquidation instruction for Yingli should be issued that specifically includes MS Solar." The judge dismissed the case without prejudice.

(MS Solar Investments v. United States, Slip Op. 22-140, CIT #21-00303, dated 12/12/22, Judge Jennifer Choe-Groves. Attorneys: Mark Herlach of Eversheds Sutherland (US) for plaintiff MS Solar; Bryan Boynton for defendant U.S. government)