UFLPA Statute Requires More Than 'Reasonable Cause' When Adding to UFLPA Entity List, Ninestar Argues

The "low standard of proof" that the Forced Labor Enforcement Task Force used in adding exporter Ninestar Corp. to the Uyghur Forced Labor Prevention Act Entity List violates the requirements of UFLPA as written in the statute, Ninestar argued in a Jan. 10 supplemental brief at the Court of International Trade (Ninestar Corp. v. U.S., CIT # 23-00182).

Responding to the government's defense of its evidentiary standard, which is based on a "reasonable cause to believe" that the company is making its goods with forced labor, Ninestar said the UFLPA statute itself "requires more." The statute "is best read to impose a preponderance standard in light of the presumption that such a standard applies to fact finding, the significant consequences of listing, and the Act's deliberative listing process," the brief said.

Ninestar had previously claimed that, without a statute to the contrary, the minimal burden that should be set on companies subject to administrative proceedings is a preponderance of the evidence (see 2401040056). Earlier this month, the government argued that this rule applies only to formal agency proceedings, noting that FLETF listing decisions are informal, meaning the task force can choose the evidentiary standard it sets.

Ninestar called this argument a "red herring," saying the government may not ignore the procedural requirements found in the UFLPA. When read against the "well-established principle that preponderance of the evidence is the minimal appropriate burden of proof in administrative proceedings," the UFLPA statute allows listing only if the task force finds that it is "likely, i.e., more likely than not," that the "statutory requirements are met," the brief said.

The government also argued that the reasonable cause standard reflects the UFLPA's "clear and convincing evidence standard." Ninestar replied that this "conflates the showing required to overcome the UFLPA's rebuttable presumption with the standard applicable to establishing the presumption in the first instance." That the statute shifts the burden to the company after listing "says nothing about the standard required for listing itself." In fact, the high bar for rebutting the presumption suggests "that the initial listing decision must be based on more than FLETF's hunch," the exporter added.

The government's "remarkabl[e]" defense that foreign affairs bar judicial review of the low evidentiary bar is "wrong" because FLETF's task is "not to manage foreign affairs but to enforce a trade restriction," Ninestar said. The listing decision "involved trade, not foreign relations." In any case, courts "do not defer to the Executive on 'pure question[s] of statutory construction,' even of a foreign-affairs law," the brief noted.

Oral argument on Ninestar's motion for a preliminary injunction will be held Jan. 18. The proceeding also will cover the exporter's request to unseal and unredact information FLETF used in making its listing decision. Relating to this motion, the trade court in a Jan. 10 text-only order allowed Ninetsar to file a reply in support of its motion by Jan. 15 in light of the government's reply brief. The U.S. has said it doesn't have to turn over part of the record pertaining to an informant in the case and has a right not to share most of the record with Ninestar, limiting exposure only to Ninestar's counsel (see 2401100028).

Ninestar on Jan. 9 filed an expedited motion for leave for its counsel to disclose the information the U.S. deems nonconfidential. In the same text-only order, the court denied this motion as premature.