CIT Questions Jurisdiction to Hear Case on Reconsideration of Injury Decision

Court of International Trade Judge Timothy Reif, during June 13 oral argument, expressed skepticism at Turkish exporter Erdemir's bid to stay in court under Section 1581(i) in its case challenging the International Trade Commission's decision not to hold a reconsideration proceeding regarding whether Turkish hot-rolled steel flat products injured the U.S. market (Eregli Demir ve Celik Fabrikalari v. U.S. International Trade Commission, CIT Consol. # 22-00349).

However, Reif noted that for future cases the commission can be a "little more indicative and transparent." The judge said the ITC's communications to an "interested party" in this case weren't "what one might describe as optimal."

In the case, Erdemir requested either a reconsideration of the ITC's injury finding or a changed circumstances review to take another look at the original negligibility analysis after judicial review left respondent Colakoglu with a zero percent dumping margin and excluded from the AD order. Erdemir said this exclusion meant that the ITC would have to terminate the AD investigation on goods from Turkey "on negligibility grounds" (see 2310020057). The company also said that without either a reconsideration or changed circumstances review, the ITC should note the change in the "then-pending sunset review."

The exporter challenged the ITC's refusal to initiate reconsideration or a changed circumstances review under Section 1581(i), the court's "residual" jurisdiction, though the U.S. said the case should be tossed since it's truly a Section 1581(c) case (see 2311060027). Erdemir said relief wasn't available under 1581(c) without a stay of the original injury investigation.

At oral argument, David Simon, counsel for Erdemir, said that filing suit under 1581(c) and asking the court for a stay would have been based on "speculation." He said not filing speculative appeals is a "fundamental obligation of an attorney" and that the concept of a "purely protective appeal" that is of no substance but depends on future events that "might or might not occur at some indefinite time in the future" is "abhorrent" to him.

Simon added that he doesn't know of any cases in which such said appeals are allowed. In response, Reif said that there are cases where "the court has done that." In those cases, counsel "has filed a [1581(c)] case with approximately this degree of predictability," parallel to a case challenging a Commerce Department conclusion.

Reif also drew attention to the fact that Colakoglu had already successfully challenged the parallel countervailing duty investigation. The judge suggested that Erdemir could have pointed to Colakoglu's success in that suit to erase any speculation in Erdemir's 1581(c) suit. Simon said the precedential opinions are split on this issue.

Jeffrey Gerrish, counsel for petitioners led by Steel Dynamics, said that it's "incumbent on the company to file an appeal, to preserve its rights," where an appeal of a Commerce decision would be determinative of the ITC's analysis. Simon replied that this position would require parties "to appeal every case," opening a flood of litigation.

Gerrish added that the Statement of Administrative Action clearly said that changes in dumping margins can't stand as a basis for the ITC to reconsider injury determinations so that these decisions won't "be in a state of flux." To this, Reif took note that the government trusted the government's lawyers to "carry its water" on the motion to dismiss and lead the arguments in the case. In response, a U.S. attorney said this is only for the motion to dismiss and not the merits of the case.

Reif said he didn't "understand the commission's administrative practice" in this case because the ITC didn't respond to Simon's request asking either for a reconsideration of the injury proceeding, CCR or stay of the sunset review. The judge noted that while the commission didn't have an obligation to reply, it wasn't an "example of best practices." Regarding the three proceedings at issue -- reconsideration, CCR and sunset reviews -- it "might be better to be a little more" transparent, the judge said.

The court additionally pressed Simon on whether the statute allows for the reconsideration of retroactive margin changes. Reif said the statute "appears to provide a very clear direction to the commission as to what they should consider for review," and that this standard doesn't include the word "retroactivity."

Simon's claim was that to give the SAA "any applicability at all, there has to be a mechanism by which the commission will reconsider, based on a predetermination following remand in an investigation." To this, Reif provided a hypothetical where in the second year of an AD order, the margin drops sharply in a way that could affect the ITC's analysis of price effects but doesn't require retroactive imposition of the development. This seemingly wouldn't make the provision of the SAA surplusage, the judge noted.