FLETF Used Wrong Evidentiary Standard in Adding Ninestar to UFLPA Entity List, Exporter Tells CIT

A review of the administrative record behind the addition of Ninestar to the Uyghur Forced Labor Prevention Act Entity List shows the Forced Labor Enforcement Task Force (FLETF) had no basis for the listing, Ninestar argued in a Dec. 15 brief in support of its bid for a preliminary injunction (Ninestar Corp. v. United States, CIT # 23-00182).

Ninestar argued that the motion for a PI against its placement on the list should be granted since the company is "likely to succeed on the merits," especially after the exporter recently amended its complaint to argue that there was insufficient evidence to make the decision.

According to Ninestar the UFLPA allows FLETF to list entities working with the Chinese government in the Xinjiang region to receive forced labor of the persecuted groups in the region. Ninestar argued that FLETF said there was "reasonable cause to believe" that the company did so. "In other words, FLETF did not require proof beyond a reasonable doubt; did not require a preponderance of the evidence; nor did it even require a plurality of the evidence," the brief said.

"Rather, FLETF determined unilaterally that it can prohibit an entity’s goods from entering this country based ... [on] nothing more than an articulable suspicion, akin to the meager showing that allows police officers to conduct brief investigatory stops based on little more than a hunch."

Ninestar claimed that based on the lack of a clear statutory directive, the "preponderance of the evidence" standard acts as the minimum accepted standard in administrative proceedings. Given the stakes of UFLPA listings, where FLETF with "the stroke of a pen" can "embargo hundreds of millions of dollars of goods," it "would be passing strange for Congress to have authorized imposing such drastic consequences on mere 'reasonable cause,'" the brief said. As a result, the listing decision was conducted pursuant to an illegal standard and the exporter says it is likely to succeed on this claim, warranting an injunction.

The exporter went on to argue that FLETF illegally applied the UFLPA retroactively and made the claim based on an insufficient record. Ninestar has adapted its claims once it was confidentially allowed to see the record. Even now the exporter is fighting to unredact the record at the trade court (see 2312050023).

In the PI motion, Ninestar centered its evidentiary arguments on two conclusions: that Ninestar cooperated with the government of the Xinjiang Uyghur Autonomous Region to receive Uyghur laborers and that Ninestar currently works with the XUAR government to receive forced labor. FLETF based the first conclusion on evidence from DHS showing that Ninestar recruits the laborers via a third-party agency that works with the XUAR government, though FLETF never said whether "or, if so, why" it equated a third-party agency with the XUAR government.

FLETF didn't even go so far as to say it interpreted the statutory phrase "works with government of the XUAR" to include "cooperating through an intermediary" or that it found the third party to be an arm of the XUAR government, Ninestar noted. "None of the speculation matters," the brief said, adding that neither the courts nor litigants can provide a reasoned basis for the agency's decision" the agency itself hasn't provided.

Ninestar's motion comes on the heels of the trade court finding that it had jurisdiction to hear the case (see 2311300038). The decision potentially opened the door for all UFLPA Entity List additions to be tried at the Court of International Trade.