CIT Explains CBP Right to Reverse Evasion Determination Against Dominican Exporter, Importers

The Court of International Trade on June 17 (see 2406170037) -- in an opinion released publicly July 10 -- upheld a CBP finding that six companies didn’t evade antidumping and countervailing duties on aluminum extrusions from China by transshipping them through the Dominican Republic. Judge Richard Eaton explained that CBP had reasonably reinterpreted record evidence within the context of other information it had failed to consider previously.

After the remand, the agency conducted a “thorough and comprehensive” review of the evidence and its prior findings -- for the first time, it claimed -- and explained why its initial determination was wrong “in granular detail,” he said. He noted CBP’s claim that the Regulations and Rulings Office’s previous review of the initial determination had only been two pages long.

The customs agency changed its evasion determination following a 2022 voluntary remand to consider additional evidence such as “public summaries and party arguments with respect to such, certain entry data reports, fact sheets, importer responses to [CBP’s] request for information” and record evidence (see 2209080013). In response, the petitioner of the Enforce and Protect Act investigation, the Aluminum Extrusions Fair Trade Committee, argued that CBP “changed its mind” regarding the reliability of previous evidence “without providing a rational explanation” for doing so (see 2304280044).

The committee also argued that CBP wrongly went beyond the scope of its remand order when it requested all parties submit public versions of the confidential business summaries they had already put on the record.

Eaton agreed that this hadn’t been required by the order, which held only that the agency itself had failed to supply certain public summaries to the record. However, he said that “it is difficult to see any harm caused by” the decision, as “it does not appear that Consolidated Plaintiffs complied with Customs’ request on remand to review, revise, and resubmit previously submitted public summaries.” Instead, they only changed the format of those summaries in Adobe, he said.

The judge also discussed the arguments raised by both the petitioner and CBP after his remand order, ruling in favor of CBP.

“Contrary to the Committee’s contentions, Customs adequately explained its reasons for interpreting the evidence differently on remand,” Eaton said.

The petitioner said CBP initially found evidence, including photographs and videos of the exporter Kingtom’s Dominican facilities, a site visit and “widespread” record discrepancies, that led it to conclude the exporter wasn’t capable of producing all the products they sold, the petitioner said. However, the agency later wrongly dismissed this evidence, as well as expert testimony and a government report, it said.

Actually, CBP changed course after receiving new evidence, including “public summaries and party arguments with respect to such, certain entry data reports, fact sheets, importer responses to [CBP’s] request for information” and record evidence, the agency said.

The second time around, CBP correctly examined facility photos and videos “within a larger evidentiary context, taking into account Kingtom’s own production records,” Eaton said. The same was true regarding the agency’s reconsideration of its site visits, he said.

Using that information, it reevaluated the apparent lack of production activity occurring in photos and videos, and during on-site visits, finding that it didn’t “mean that Kingtom’s machines were not operational at other times,” he said.

And he agreed that “so-called” record discrepancies weren’t substantial evidence of evasion, saying they “had reasonable explanations, or simply did not matter to the central question in the case.” Minor inconsistencies in bank statements, for instance, were bank transaction fees, he said.

(H&E Home v. U.S., Slip Op. 24-73, CIT # 21-00337, dated 6/17/2024; Judge: Richard Eaton; Attorneys: Lizbeth Levinson of Fox Rothschild for plaintiffs H&E Home and Classic Metals Suppliers; David Craven of Craven Trade Law for consolidated plaintiff Global Aluminum Distributor; Beth Ring of Sandler Travis for consolidated plaintiffs Industrias Feliciano Aluminum, Puertas y Ventanass J.M. and JL Trading; Jordan Fleischer for plaintiff-intervenor Kingtom Aluminio; Alexander Vanderweide for defendant U.S. government; and Elizabeth Lee of Wiley for defendant-intervenor Aluminum Extrusions Fair Trade Committee)