CIT Sustains Exclusion of Importer's Flanges From AD Order on Chinese Pipe Fittings

The Court of International Trade on March 11 sustained the Commerce Department's remand results excluding importer Crane Resistoflex's ductile iron lap joint flanges from the antidumping duty order on pipe fittings from China. Judge Timothy Stanceu upheld the decision as now being in a form the court could sustain, after previously finding it to not be, and as being backed by substantial evidence due to the agency's consideration of a host of (k)(1) factors.

After Commerce first decided to exclude Crane's flanges from the scope of the AD order on remand, Stanceu said he couldn't uphold the decision since it wasn't in the proper form (see 2211210025). The agency said that if the court affirmed the decision, it would "issue a revised scope ruling accordingly." The judge said he couldn't affirm this position since it wasn't an actual agency decision, stripping the court of the ability to review the final decision made on remand and the parties of their right to comment on the decision.

On its third remand, Commerce said that should the court affirm, a Federal Register notice will be published stating that Crane's flanges are outside the order's scope and that relevant CBP instructions also will be issued to this effect. Stanceu said this was sufficient to sustain the decision.

In addition, the court ruled against arguments from petitioner ASC Engineered Solutions that said that Commerce improperly considered (k)(1) sources in its scope decision since the scope language unambiguously includes ductile iron flanges such as Crane's. Stanceu found this claim to be "unpersuasive" since the scope language, while using the term "fittings," doesn't define the term and "on its face does not resolve the issue of whether flanges in general, or ductile iron flanges in particular, were within the intended meaning of that term."

As a result, consideration of the (k)(1) factors was "essential" to the finding on whether the flanges were within the scope of the order, the court said.

Opining on the (k)(1) factors themselves, Stanceu ruled that the exclusion of Crane's products from the AD order was proper. The court said that while it previously identified detracting evidence that Commerce failed to consider, the agency has now grappled with that evidence and excluded Crane's goods.

ASC claimed that the International Trade Commission's report in the injury investigation is "ambiguous" on whether the commission meant to exclude ductile iron flange fittings from the scope of its investigation. Stanceu said he already noted that this conclusion overlooks the significance of the ITC's discussion of its domestic like product and the scope of the ITC's investigation. The commission "was aware of the specific exclusion Commerce provided for certain goods conforming to specifications of the American Water Works Association, 'and the ITC expressed no disagreement with respect to it,'" the opinion said.

What isn't ambiguous is that the ITC defined the domestic like product as corresponding to the scope of its investigation and didn't broaden the scope of it to include ductile iron flange fittings, Stanceu said. In addition, the AD petition didn't identify flanges in the body of the document as a class or kind of good that was meant to be covered by the investigation, the court noted.

(MCC Holdings, doing business as Crane Resistoflex v. United States, Slip Op. 24-30, CIT # 18-00248, dated 03/11/24; Judge: Timothy Stanceu; Attorneys: Peter Koenig of Squire Patton for plaintiff Crane Resistoflex; Joshua Kurland for defendant U.S. government; Daniel Schneiderman of King & Spalding for defendant-intervenor ASC Engineered Solutions)