CAFC Judge Questions CBP's Potential Due Process Violations in EAPA Case on Pencil Imports

Judge Timothy Dyk at the U.S. Court of Appeals for the Federal Circuit sharply questioned CBP at oral argument on whether the agency violated importer Royal Brush Manufacturing's due process rights in an Enforce and Protect Act investigation that found that the importer evaded antidumping and countervailing duty orders on pencils from China (Royal Brush Manufacturing v. United States, Fed. Cir. # 22-1226).

Margaret Jantzen, the government's attorney, said CBP would be at risk of venturing beyond its statutory authority if it issued a protective order during the investigation and that the agency provided summaries of confidential information, clearing the bar for due process. Jantzen said that if CBP issued a protective order, it would be "filling in a gap" in the statute, adding that this was the reason summaries of the confidential information were provided, even though the actual numbers used by the agency were not disclosed.

"Come on, they blanked out the numbers," Dyk exclaimed. "That's not giving them the information. How can you get anything out of a statement when the numbers are not there? How can that possibly give you the necessary information?"

Jantzen noted that when Royal Brush had the information at the Court of International Trade, it did not argue that it was prejudiced by the lack of information. Dyk countered by saying that when a due process violation exists, the court does not look to the question of prejudice.

Judge Kara Stoll also questioned the government's position that CBP did not have the explicit authority to issue a protective order. "I'm having a hard time understanding why statutory authority to have a protective order would be required," she said. Jantzen said it was to authorize CBP to disclose information parties had deemed to be confidential business information. Stoll then questioned why having a protective order would not satisfy these concerns.

After initially finding that CBP violated due process by not providing adequate public summaries of the confidential information, the trade court upheld the evasion finding, declaring that the agency did not need to disclose all confidential information (see 2012020050). At the Federal Circuit, the U.S. moved to dismiss the case because it discovered that all the entries at issue had been liquidated (see 2301310032).

That point was also addressed at oral argument, with Steven Gordon, counsel for Royal Brush, claiming that dismissing the case on these grounds violates common sense and the law. Gordon said there's a congressional command to not liquidate entries subject to an EAPA case. In this proceeding, CBP violated its own obligations, then said all affected parties were out of luck in terms of earning relief at the courts, Gordon said.