CAFC Denies Rehearing Bid in Suit on Expansion of Section 232 Duties to Derivative Products

The U.S. Court of Appeals for the Federal Circuit in a June 22 order denied a bid for panel rehearing and rehearing en banc in the suit on President Donald Trump's expansion of Section 232 steel and aluminum duties onto derivative products. Judges Kimberly Moore, Pauline Newman, Alan Lourie, Timothy Dyk, Sharon Prost, Jimmie Reyna, Richard Taranto, Raymond Chen, Todd Hughes, Kara Stoll and Leonard Stark made the decision denying the petitioners, ruling that the mandate will be issued June 29 (PrimeSource Building Products v. United States, Fed. Cir. # 21-2066).

Importers Oman Fasteners, Huttig Building Products and PrimeSource Building Products vied for the rehearing, arguing that if the decision allowing the expansion of the duties stands, the president will receive "unbounded legislative power to regulate foreign trade" (see 2304260033). So long as the commerce secretary makes a threat determination on the targeted product or any material used to make the product, the president can take any action, at any time, on any imported good, the brief said.

The appellate court made its decision in February, finding that Trump legally expanded the duties beyond procedural time limits onto the derivative products (see 2302070030). The court relied heavily on its past opinion in Transpacific Steel v. U.S., in which the court said the president can adjust the tariffs beyond these limits if it relates to the original plan of action laid out in the initial Section 232 tariff action. Finding that the expansion of duties onto derivatives fits within the original Section 232 plan of action, the appellate court sustained the move.