Seafood Seller Says Commerce Imposed Arbitrary Requirement to Establish Standing for AD Review

U.S. seafood seller Luscious Seafood argued on Sept. 13 that the Commerce Department misinterpreted the statute when it found that the company didn't qualify as a bona fide wholesaler of the domestic like product. As a result of its finding, Commerce found Luscious' request for administrative review of the antidumping duty order on frozen fish fillets from Vietnam invalid (Luscious Seafood v. United States, CIT # 24-00069).

Luscious filed a request for review in 2022, asking Commerce to review 136 exporters of fish fillets from Vietnam. The agency responded with various wholesaler questionnaires to ascertain if the company was able to file such a request under the statute -- 19 U.S.C. 1677(9) -- which says only an "interested party" can take part in AD proceedings. Commerce ultimately held that Luscious didn't make bona fide sales of fish fillets in the U.S. to qualify as a wholesaler of the domestic like product.

Appealing the matter to the Court of International Trade (see 2405020035), Luscious claimed that Commerce misapplied the statute in focusing on the presence of bona fide wholesaling operations. The company said the statute "only states what interested parties may participate" in an AD proceeding, listing those parties as manufacturers, producers or wholesalers. As a result, "on its face, neither the statute, nor Commerce's own regulations require Commerce to analyze the presence of bona fide wholesaling operations to attain standing," the brief said.

While the trade court said Commerce can presume standing to request a review until presented with evidence undermining the legitimacy of that decision, the agency didn't provide a "satisfactory explanation" for its decision after addressing the evidence at issue here, the brief said. Commerce instead used an "incredibly stringent documentation requirement" for the company that "demanded in-depth scrutiny not mandated to others." The company said in particular it was "arbitrary and capricious" to require domestic origin documentation and minimum documentation of domestic activity.

Luscious also claimed that after the Supreme Court's ruling in Loper Bright Enterprises v. Raimondo, which said courts need not defer to agencies' interpretations of ambiguous statutes, the trade court should reject the agency's "over-reach." The only question here is whether Luscious engaged in wholesaling, to which the answer is "clearly yes," the brief said.

The company said Commerce "singled" it out for special scrutiny not applied to others. While the company said it understands the agency "reasonably may require some proof of eligibility of interested parties, the standard should not be, and usually is not, the 'high hurdle' applied to Luscious," the brief said. For instance, in a separate proceeding, Commerce only required an interested party to provide evidence that it "made at least one sale" during the review period. In that proceeding, Commerce also said "there is no rule that the standing of domestic parties is contingent on sales within" the review period, Luscious noted.

In contrast, Luscious "was subject to arbitrary and capricious 'domestic activity' and 'domestic origin' tests based on its time in business, sources of funding for transactions, number of transactions with affiliated parties and profitability," the company said.