Snap-on, Inc. v. United States, No. 13-00238 (Ct. Int'l Trade 2013)
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Slip Op. - UNITED STATES COURT OF INTERNATIONAL TRADE SNAP-ON, INC., Plaintiff, v. Before: Donald C. Pogue, Chief Judge UNITED STATES, Court No. 13-00238 Defendant. [granting the Defendant s motion for summary judgment and denying Plaintiff s motion for summary judgment] Dated: Bruce J. Casino and J. Scott Maberry, Sheppard Mullin Richter & Hampton, LLP, of Washington, DC. for Snap-on, Inc. Tara K. Hogan, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, Department of Justice, of Washington, DC for Defendant. Also on the brief were Stuart F. Delery, Assistant Attorney General, Jeanne E. Davidson, Director, and Reginald T. Blades, Jr., Assistant Director. Of counsel on the brief was Joanna Theiss, Office of Import Trade Administration, Department of Commerce, of Washington, DC. OPINION Pogue, Chief Judge: In this action, Plaintiff, Snap-on, Inc. ( Snap-on ), a U.S. importer of goods containing aluminum Court No. 13-00238 Page 2 extrusions manufactured in China, seeks an order enjoining the Department of Commerce from requiring, and U.S. Customs and Border Protection from collecting, 374.15% all others cash deposits and countervailing duties for Plaintiff s entries. Plaintiff contends that the all others rate applicable to its entries should be 137.65% (the revised rate ) in accordance with this court s judgment in MacLean-Fogg v. United States, 36 CIT _, 885 F. Supp. 2d 1337 (2012)( MacLean-Fogg IV ).1 The court has jurisdiction over Plaintiff s claim under 28 U.S.C. § 1581(i)(2006). Currently before the court are Defendant s Motion to Dismiss and for Summary Judgment, ECF No. 16, and Plaintiff s Motion for Summary Judgment, Motion for Writ of Mandamus, Declaratory Relief, or Preliminary Injunction, ECF No. 18. By its motion, Defendant asserts that, as a matter of law, Plaintiff cannot establish entitlement to the revised 137.65% rate. In its cross-motion, Plaintiff asserts that it is entitled to the revised rate and thus the court should grant its request for a writ of mandamus, declaratory judgment, and permanent injunction. 1 This case is currently on appeal. Court No. 13-00238 Page 3 As explained below, because there was no injunction suspending the liquidation2 of Plaintiff s entries in the litigation challenging the 374.15% rate, or any subsequent administrative review, and because Plaintiff did not participate in any of these proceedings, Section 561A(c) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(c)(1)(2006),3 requires that Defendant s motion be granted. BACKGROUND The duty rates at issue stem from Commerce s April 27, 2010 initiation of antidumping ( AD ) and countervailing duty ( CVD ) investigations of certain aluminum extrusions from the People s Republic of China ( China or PRC ). Statement of Stipulated Facts ( Stipulated Facts ), ECF No. 15 at ¶¶ 6-7; see also Aluminum Extrusions from the People s Republic of China, 75 Fed. Reg. 22,114 (Dep t Commerce Apr. 27, 2010) (initiation of countervailing duty investigation); Aluminum Extrusions from the People s Republic of China, 75 Fed. Reg. 22,109 (Dep t Commerce Apr. 27, 2010) (initiation of antidumping duty investigation). In that investigation, Commerce, on April 4, 2011, issued a 2 Liquidation is the final computation or ascertainment of duties on entries [. . .] 19 C.F.R. §159.1 (defining liquidation). 3 All further citations to the Tariff Act of 1930, as amended, are to Title 19 of the U.S. Code, 2006 edition. Court No. 13-00238 Page 4 final CVD determination that set the CVD rate for those exporters and producers not individually investigated (the all others rate)4 at 374.15%. Stipulated Facts at ¶ 12; see also Aluminum Extrusions from the People s Republic of China, 76 Fed. Reg. 18,521 (Dep t Commerce Apr. 4, 2011) (final affirmative countervailing duty determination). Snap-on s merchandise was entered after Commerce s final CVD determination -- between May 31, 2011, and March 12, 2012. Stipulated Facts at ¶¶ 14, 16-24, 30. The merchandise constitutes ten entries of goods manufactured by Zhangjiagang GuPai Aluminum Industry Co. ( GuPai ). Although Commerce s final affirmative countervailing determination was challenged in this court, neither GuPai nor Snap-on participated in the investigation as a named respondent or otherwise qualify for a separate rate for entries of subject merchandise, Stipulated Facts at ¶ 9, nor was either a party to the court review. Snap-on also did not deposit estimated countervailing duties on their entries. Stipulated Facts at ¶ 24. Rather, the entries were designated as CBP Entry Type 01. Id.5 Customs did 4 See 19 U.S.C. §§ 1673b(d), 1673d(c)(5). Entry Type 01 is the designated category for free and dutiable goods. Tianjin Tiancheng Pharm. Co. v. United States, 29 CIT 256, 273, 366 F. Supp. 2d 1246, 1261 (2005). Entry Type 03 is the category for goods subject to antidumping duties. Tak Yuen Corp. v. United States, 29 CIT 543, 547 (2005). It is unclear whether Snap-on chose to enter the goods as Type 01 on (footnote continued) 5 Court No. 13-00238 Page 5 not accept the Type 01 designation6 and instructed Snap-on to obtain a scope ruling from Commerce for their aluminum extrusion imports. Id. at ¶ 29.7 Fifteen months after its final determination, on July, 10, 2012, Commerce initiated the first administrative review of the CVD and AD orders on aluminum extrusions from China. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 77 Fed. Reg. 40,565 (Dep t Commerce July 10, 2012) (initiation of antidumping and countervailing duty administrative reviews and request for revocation in part).8 Consistent with its initiation notice, the basis of a good faith belief that the goods were not subject to the AD and CVD orders on aluminum extrusions. 6 Addressing these entries, on February 14, 2012, CBP emailed Snap-on s customs broker, UTi, to request that entries with aluminum extrusions be filed as paper entries because such entries were potentially subject to antidumping and countervailing duties. Stipulated Facts at ¶ 27. CBP further specified on February 15, 2012, that they were in the process of confirming the classification and AD/CVD determination for Plaintiff s entries and hence, would allow for type 01 entries and the furniture parts classification. Id. at ¶ 29 (citing email from Senior Import Specialist Michael Carriere on February 15, 2012). 7 Snap-on, however, did not seek a scope ruling on its merchandise. 8 The U.S. system for assessing AD and CVD duties is described as retrospective. (The process for collection of cash deposits and liquidation of entries is essentially the same for entries subject to AD and CVD duties. For a more complete discussion of the process for assessing AD duties, see Sioux Honey Ass n v. Hartford Fire Ins. Co., 672 F.3d 1041, 1046 48 (Fed. Cir. 2012).) Briefly, an AD or CVD margin is established during the investigation, and that margin becomes the cash (footnote continued) Court No. 13-00238 Page 6 Commerce instructed Customs to assess countervailing duties on merchandise entered, or withdrawn from warehouse, for consumption at the cash deposit or bonding rate in effect on the date of entry, for all firms for whom no review request was made.9 Stipulated Facts at ¶ 34 (citing Automatic Liquidation deposit rate for the year following the conclusion of the investigation, as published in the AD or CVD order. On the first year anniversary of the order, interested parties may request an administrative review. The review establishes a new margin based on actual entries during the prior year. This margin becomes the assessment rate for merchandise entered during the year prior to the review and the cash deposit rate for merchandise entered during the year following the review. Entries entered during the previous year are then liquidated at the assessment rate established in the review. If the assessment rate is lower than the cash deposit rate for the entries liquidated, then the importer receives a refund. If the assessment rate is higher than the cash deposit rate, then the importer owes additional duties. On the one-year anniversary of the first review, a second review can be requested and the process is repeated. See 19 U.S.C. § 1675(a)(1)-(2). 9 The entries from GuPai are also subject to antidumping duties which are not at issue in this case. Stipulated Facts at ¶ 34. Consistent with the initiation of the first administrative review of the AD order, Commerce issued instructions to CBP to liquidate entries for firms listed in the instructions. GuPai was not listed and therefore, was not subject to the liquidation. Id. (relying on Non-Review liquidation Instruction for Aluminum Extrusions from the People s Republic of China for the Period 11/12/2010 through 4/30/2012, Message No. 2212302, A-570-967, POR Nov. 12, 2010 Apr. 30, 2012 (July 27, 2012), available at http://addcvd.cbp.gov/detail.asp?docID=2212302&qu=2212302 (last visited Dec. 10, 2013)). Because the GuPai entries are suspended under the AD administrative review, they are effectively suspended from liquidation for purposes of the CVD order. In addition, a July 16, 2013 order, ECF No. 12, granted a preliminary injunction suspending all liquidation pending the decision in this case. Court No. 13-00238 Page 7 Instructions for Aluminum Extrusions from the People s Republic of China for the Period 09/07/2010 through 12/31/2011, Message No. 2209305, C-570-968, POR Sept. 07, 2010-Dec. 31, 2011 (July 27, 2012), available at http://addcvd.cbp.gov/detail.asp?docID=2209305&qu=2209305 (last visited Dec. 10, 2013)). Because no request was made for review of GuPai, the GuPai entries entered prior to initiation of the first administrative review became subject to liquidation at the 374.15% rate that was in effect on the date of entry.10 10 See 19 C.F.R. § 351.212(c): Automatic assessment of antidumping and countervailing duties if no review is requested. (1) If the Secretary does not receive a timely request for an administrative review of an order (see paragraph (b)(1), (b)(2), or (b)(3) of § 351.213), the Secretary, without additional notice, will instruct the Customs Service to: (i) Assess antidumping duties or countervailing duties, as the case may be, on the subject merchandise described in § 351.213(e) at rates equal to the cash deposit of, or bond for, estimated antidumping duties or countervailing duties required on that merchandise at the time of entry, or withdrawal from warehouse, for consumption; and (ii) To continue to previously ordered. collect the cash deposits (2) If the Secretary receives a timely request for an administrative review of an order (see paragraph (b)(1), (b)(2), or (b)(3) of § 351.213), the Secretary will instruct the Customs (footnote continued) Court No. 13-00238 Page 8 Prior to any liquidation, however, on December 20, 2012, Commerce notified CBP that it had amended its final CVD determination consistent with MacLean-Fogg IV and instructed CBP to collect an all others cash deposit rate of 137.65% for all shipments of aluminum extrusions from the PRC entered on or after December 10, 2012. Id. at ¶ 39 (citing Notice of an Amended Final Determination in the Countervailing Duty Investigation of Aluminum Extrusions from the People s Republic of China, Message No. 2355304, C-570-968, POR Jan. 01, 2009-Dec. 31, 2009 (Dec. 20, 2012), available at http://addcvd.cbp.gov/detail.asp?docID=2355304&qu=2355304 (last visited Dec. 10, 2013)). Also, on June 10, 2013, Commerce issued the preliminary results of its Countervailing Duty Administrative Review of the First Review Period, which stated that CBP would be instructed to collect cash deposits of estimated countervailing duties at the most recent applicable all others rate. Id. at ¶ 43 (citing Aluminum Extrusions from the People s Republic of China, 78 Fed. Reg. 34,649, 34,652 (Dep t Commerce June 10, 2013) (preliminary results of the Service to assess antidumping duties or countervailing duties, and to continue to collect cash deposits, on the merchandise not covered by the request in accordance with paragraph (c)(1) of this section. . . . Court No. 13-00238 Page 9 countervailing duty administrative review for the period Sept. 7, 2010 through Dec. 31, 2011). Thereafter, Commerce, on June 28, 2013, initiated the second administrative review of the CVD order in effect on aluminum extrusions from the PRC for the period of January 1, 2012, to December 31, 2012 and the AD order in effect on aluminum extrusions from the PRC for the period of review May 1, 2012 through April 30, 2013. Id. at ¶ 45-46. Consistent with the initiation of the second administrative review, on July 16, 2013, Commerce issued liquidation instructions for entries made by all firms except those subject to the review. Id. at ¶ 48 (citing Automatic Liquidation instructions for Aluminum Extrusions from the People s Republic of China for the Period 01/01/2012 through 12/31/2012, Message No. 3197305, C-570-968, POR Jan. 01, 2012 Dec. 31, 2012 (July 16, 2013), available at (last visited Dec. 10, 2013)). Once again, no request was made for review of the entries from GuPai, and the GuPai entries became subject to liquidation under the CVD order.11 However, as referenced above, Commerce amended the final determination in the CVD investigation, reducing the all others rate from 374.15% to 137.65% in response to MacLean-Fogg 11 Plaintiff s entries again remained unliquidated because of a suspension order by Commerce in the parallel AD case. Stipulated Facts at ¶ 35. Court No. 13-00238 IV. Page 10 That decision followed several rounds of litigation. First, in MacLean-Fogg I, importers of aluminum extrusions from China challenged the all others CVD rate. MacLean-Fogg v. United States, 36 CIT _, 836 F. Supp. 2d 1367 (2012). To calculate the all others rate, Commerce had excluded the weighted average of voluntary respondents rates and used the weighted average adverse facts available rate of the uncooperative mandatory respondents.12 Id. at 1375 (explaining Commerce s authority to use sampling to calculate all others rate under 19 U.S.C. § 1677f-1(e), as limited by the reasonableness criterion under 19 U.S.C. § 1671d(c)(5)(A)(ii)). The court held that Commerce s choice of methodology was reasonable but its calculation process was not and remanded the case for recalculation or further explanation. Id. at 1376. In MacLean-Fogg II, on a motion to seek reconsideration of the court s opinion in MacLean-Fogg I, the Plaintiffs claimed that the court should also address Commerce s preliminary rate determination. MacLean-Fogg v. United States, 36 CIT _, 853 F. Supp. 2d 1253 (2012). The motion was granted in part, holding that the preliminary rate determination would be reviewed for reasonableness upon 12 Commerce calculated the all others rate by using the weighted average of the rates for the three mandatory respondents, which Commerce in turn had calculated by resorting to adverse facts available. MacLean-Fogg I, 836 F. Supp. 2d at 1371. See 19 U.S.C. § 1677e (authorizing resort to adverse facts available for respondents lack of cooperation). Court No. 13-00238 consideration of the remand results. Id. Page 11 In MacLean-Fogg III, the Court reviewed Commerce s remand results. Finding that Commerce used the same method in calculating the all others CVD rate, the court remanded again for recalculation or for further explanation as to whether the rate was punitive. Maclean-Fogg v. United States, 36 CIT _, 853 F. Supp. 2d 1336, 1343 (2012). In Maclean-Fogg IV, Commerce recalculated the all others CVD rate, finding the preliminary rate of 137.65% to be the appropriate rate. The CIT affirmed. MacLean-Fogg IV, 885 F. Supp. 2d at 1343. The Court found that the application of this rate was reasonable and remedial given the lack of information on the record that Commerce could use in making the all others calculation. Id. at 1342. Subsequent to the court s decision in Maclean-Fogg IV, on May 31, 2013, Snap-on received a Notice of Action from CBP indicating that Snap-on owed CVD duties at a rate of 374.15% for the ten entries at issue. Stipulated Facts at ¶ 42. Because all of the entries were entered prior to December 10, 2012 the date on which the amended final determination rate of 137.65% went into effect the Notice of Action indicates that the 137.65% rate affirmed in MacLean-Fogg IV would not be applied to entries entered prior to the effective date. Specifically, the Notice of Action apprises Snap-on of the duties owed on its entries and of the fact that interest will accrue so long as Court No. 13-00238 such duties go unpaid. Page 12 In response to the Notice of Action from CBP, Snap-on filed its complaint in this action, claiming that the 374.15% rate could not be applied to its entries because the rate had been held contrary to law. Verified Compl., ECF No. 2. Specifically, Plaintiff s Amended Complaint challenges Commerce s failure to instruct Customs to collect cash deposits at a rate of 137.65% for entries entered prior to December 10, 2012. First Am. Compl. ¶¶ 39 40, ECF No. 21. This cause of action can be read as a claim for declaratory judgment regarding the valid cash deposit rate for Snap-on s entries or, alternatively, as a claim for an injunction or writ of mandamus requiring Commerce to instruct Customs to apply the 137.65% rate. Cf. Jilin Henghe Pharm. Co. v. United States, 28 CIT 969, 342 F. Supp. 2d 1301 (2004), judgment vacated as moot, 123 Fed. App x 402 (Fed. Cir. 2005); Decca Hospitality Furnishings, LLC v. United States, 30 CIT, 357, 427 F. Supp. 2d 1249 (2006).13 13 In Although Defendant challenged the Court s jurisdiction over the first count in Plaintiff s original complaint, Plaintiff s First Amended Complaint omits that count. See Defendant s Motion to Dismiss and Motion for Summary Judgment, at 9 11; First Am. Compl. Several cases discuss this court s jurisdiction in this context. See, e.g. Consol. Bearings Co. v. United States, 348 F.3d 997, 1002 03 (Fed. Cir. 2003) ( [A]n action challenging Commerce s liquidation instructions is not a challenge to the final results, but a challenge to the administration and enforcement of those final results. Thus, Consolidated challenges the manner in which Commerce administered the final results. Section 1581(i)(4) grants jurisdiction to such an action. ); Canadian Wheat Bd. v. United (footnote continued) Court No. 13-00238 Page 13 brief, Plaintiff claims that the 374.15% rate is contrary to law following MacLean-Fogg IV, and that its entries should be subject to the 137.65% rate. STANDARD OF REVIEW Where the Court has jurisdiction pursuant to 28 U.S.C. § 1581(i), it will hold unlawful and set aside agency action, findings, and conclusions found to be ... arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. 5 U.S.C. § 706(2)(A); see 28 U.S.C. § 2640(e). DISCUSSION I. Suspension of Liquidation In general, when a dumping margin established in a CVD investigation or review is challenged in this court, a preliminary injunction is entered suspending liquidation of entries subject to the challenged margin. See 19 U.S.C. § 1516a(c)(2); SKF USA Inc. v. United States, 28 CIT 170, 316 F. States, 32 CIT 1116, 1125, 580 F. Supp. 2d 1350, 1360 (2008) (noting that the Federal Circuit has instructed [the CIT] to look to the true nature of [an] action when considering jurisdiction) (quoting Norsk Hydro Can. Inc. v. United States, 472 F.3d 1347, 1355 (Fed. Cir. 2006) (alteration in original)). Court No. 13-00238 Supp. 2d 1322 (2004).14 Page 14 If litigation results in court approval of a revised rate, all entries for which liquidation was suspended pursuant to court order and section 1516a(c)(2), and all entries that occur after publication of notice of the court decision in the Federal Register, are subject to liquidation at the revised rate. See 19 U.S.C. § 1516a(e). The same is not true, however, for other entries prior to notice of the court decision. Rather, the statute specifically provides that [u]nless liquidation is enjoined by the court under [§ 1516a(c)(2)] entries of merchandise . . . shall be liquidated in accordance with the determination of [Commerce], if they are entered . . . on or before the date of publication in the Federal Register by [Commerce] of a notice of a decision of the [CIT] . . . not in harmony with that determination. 19 U.S.C. § 1516a(c)(1). These provisions have led to some confusion regarding when Commerce may liquidate entries at a rate that has been held contrary to law by the court, and this issue has been addressed in the Laclede line 15 of cases, to which we now turn. 14 Suspension of liquidation preserves litigants right to judicial review by preventing Customs s action which could moot a dispute. Zenith Radio Corp. v. United States, 710 F.2d 806, 810 11 (Fed. Cir. 1983). 15 The Laclede line includes Laclede Steel Co. v. United States, 20 CIT 712, 928 F. Supp. 1182 (1996); Jilin, 28 CIT 969, 342 F. Supp. 2d 1301 (2004); and Tembec, Inc. v. United States, 30 CIT 1519, 461 F. Supp. 2d 1355 (2006), judgment vacated, 31 CIT 241, 475 F. Supp. 2d 1393 (2007). Court No. 13-00238 II. Page 15 The Laclede line of Cases The Laclede line of cases stand[s] for the established principle that an invalid antidumping determination cannot serve as a legal basis for the imposition of antidumping duties. Andaman Seafood Co. v. United States, 34 CIT _, 675 F. Supp. 2d 1363, 1369 (2010). In Laclede Steel, 928 F. Supp. 1182, the plaintiff had challenged a 6.21% rate and the court had found that rate contrary to law, approving a revised rate on remand; however, while the challenge to the 6.21% rate was underway, Commerce initiated an administrative review that did not include the plaintiff. Therefore, the plaintiff s entries became subject to liquidation at the 6.21% rate pursuant to 19 U.S.C. § 1516a(c)(1) and 19 C.F.R. § 353.22(e) (1995). Laclede Steel, 928 F. Supp. at 1184 85. The plaintiff sought an injunction to prevent liquidation at the 6.21% rate. Id. Commerce asserted that it had implemented the court s decision invalidating the 6.21% rate for all future entries, pursuant to Timken Co. v. United States, 893 F.2d 337 (Fed. Cir. 1990), but that merchandise entered or withdrawn during the pendency of appeal was subject to the original rate pursuant to 19 U.S.C. § 1516a(a)(1). Laclede Steel, 928 F. Supp. at 1186 87. The court disagreed with Commerce, finding that the court s judgment had established the plaintiff s rate and, the plaintiff was Court No. 13-00238 Page 16 simply asking that this Court s judgment be given its full effect with respect to it. Id. at 1187. Therefore, the court held that with regard to a party for whom a judgment was final and conclusive i.e., not subject to appeal to the court of appeals the entries should be liquidated pursuant to 19 U.S.C. § 1516a(e), in accordance with the court s decision. Id. at 1188. Jilin, 342 F. Supp. 2d 1301, contained very similar facts to Laclede Steel. The plaintiff had participated in a challenge to a dumping margin that resulted in the court s invalidation of the original margin. Id. at 1303. Though plaintiff was originally a party to the third administrative review, the request for review was withdrawn, and Commerce rescinded the review as to plaintiff. Id. at 1304. Commerce subsequently issued liquidation instructions for those entries entered between the second and third administrative reviews, which instructed Customs to liquidate at the cash deposit rate in effect at the time of entry. Id. The cash deposit rate in effect at the time of entry was the original rate invalidated by the court. The Jilin court relied on Laclede Steel to hold that the decision invalidating the original rate was final and conclusive as to whether [plaintiff] was properly included in the antidumping order on bulk aspirin from China; [sic] once Court No. 13-00238 that decision became final. Id. at 1309. Page 17 Commerce was bound to follow it. The Jilin court went on to state that [o]nce Commerce s final antidumping determination has been invalidated, it cannot serve as a legal basis for the imposition of antidumping duties on [plaintiff s] entries. Id. at 1309 10. Finally, in Tembec, 461 F. Supp. 2d 1355, a three judge panel of this court applied reasoning similar to Laclede Steel and Jilin in the context of an appeal to a North America Free Trade Agreement ( NAFTA ) panel. In particular, the Tembec court read the statutes related to suspension of liquidation upon appeal to a NAFTA panel, 19 U.S.C. § 1516a(g)(5)(B) (C), to preclude liquidation of entries entered prior to a NAFTA panel review in a way that was inconsistent with the panel decision. Tembec, 461 F. Supp. 2d at 1364 67. Thus, the court has consistently held that when a party secures a right to a revised rate through judicial review, all unliquidated entries of that party which are subject to the revised rate must be liquidated at that rate regardless of whether entry occurred before or after judicial review. Furthermore, as noted above, a determination that is found to be contrary to law cannot be the basis of a duty assessment with respect to the prevailing litigant. Court No. 13-00238 Page 18 III. Plaintiff s Waiver Issue Here, however, the Laclede line of cases does not support Plaintiff s argument that the 374.15% rate, because it is contrary to law following the date of the court s decision, cannot be a valid assessment or cash deposit rate with respect to Plaintiff s prior entries. This is true because, before applying the Laclede reasoning, the Plaintiff must show that it has a right to the 137.65% revised rate affirmed in MacLean-Fogg IV. On the facts of the Laclede line, the plaintiffs suing to enforce the court s decision had an established right to the revised rate because they were parties to the litigation in which the revised rate was affirmed. See, e.g., Jilin, 342 F. Supp. 2d at 1309 ( The decision in Rhodia II was final and conclusive as to whether Jilin was properly included in the antidumping order on bulk aspirin from China; [sic] once that decision became final. ); Decca, 427 F. Supp. 2d 1249 (ordering Commerce to collect the plaintiff s revised cash deposit, as affirmed by the CIT, while the case was pending before the CAFC). Therefore, the Laclede line of cases turned on the fact that the court had adjudicated the rights of the plaintiff in a prior case, and Commerce was bound to uphold those rights. In this case, the Government asserts that Snap-on does not have any right to the 137.65% margin. Thus, unlike the Laclede line, this case does not present the question of whether Court No. 13-00238 Page 19 the plaintiff should receive the benefit of an earlier judgment rendered in its favor. Rather, this case raises the prior, threshold question of whether a recipient of the all others rate should receive the retrospective benefit of a judgment rendered in a case to which the recipient was not a party. If the answer to this threshold question is yes, then the Laclede line is relevant, but a Laclede analysis cannot be conducted without answering the logically prior question. A consideration of that prior question reveals that the Plaintiff has waived any right to the 137.65% rate. Plaintiff has waived any right to the 137.65% rate because it did not participate in the litigation challenging the investigation rate or any subsequent administrative reviews or assert a private right of action in any manner contemplated by the statute. The statute specifically provides that Commerce will liquidate entries at the cash deposit rate in effect at the time of entry for those entries entered prior to notice of a decision, if such entries are not suspended by court order. 19 U.S.C. § 1516a(c)(1); see 19 C.F.R. § 351.212(c)(1). As a result of this statutory provision, when a respondent does not join litigation, and where liquidation of its entries is not Court No. 13-00238 Page 20 suspended by court order,16 such entries may be liquidated in accordance with instructions that are not affected by the notice of a revised rate pursuant to a court decision. The statute provides two pathways for importers in Plaintiff s situation to challenge a CVD order in a way that insures retrospective application of a correct rate a challenge to the investigation and a challenge to the administrative review and it is the failure of Plaintiff to properly use these mechanisms that undermines both the legal and equitable arguments offered in favor of its motion. While this case derives from a challenge to an investigation, the extent of a party s private right to a rate has been clearly articulated in the context of administrative reviews. The benefit from lower CVD rates calculated in an administrative review or subsequent judicial review must be obtained by participating in the review processes, which is intended as the proper forum for challenging erroneous rate determinations. See 19 U.S.C. § 1675(a)(2)(C) (authorizing periodic administrative reviews); 19 C.F.R. § 351.213(b) (permitting a domestic interested party to request review); see 16 Contrary to Plaintiff s argument, suspension pursuant to court order in this action does not cure Plaintiff s failure to obtain suspension by court order under MacLean-Fogg. But the suspension here does not render Plaintiff a party to MacLeanFogg. Court No. 13-00238 Page 21 also 19 U.S.C. § 1677(9)(A) (defining interested party to include U.S. importer of affected merchandise). Barring such participation in an administrative review, the relevant regulation provides for automatic assessment of the importer s entries at rates equal to the cash deposit of . . . estimated . . . countervailing duties required on that merchandise at the time of entry. 19 C.F.R. § 351.212(c)(1)(i). Plaintiff argues that 19 U.S.C. §§1516a(c)(2) and (e)(2) entitle it to the lower rate because the contested entries were covered by the Department s determination that was challenged and invalidated in MacLean-Fogg IV. ECF No. 24. Pl s Reply at 9, This misconstrues what it means for an entry to be covered by a determination and ignores the Plaintiff s failure to avail itself of the proper administrative remedy by challenging the all others rate or participating in the administrative review. It is well established that a party who does not participate in an administrative review does not have a right to any rate calculated in the review. See Consol. Bearings, 348 F.3d at 1005-06 ( [19 U.S.C. § 1675(a)(2)(C)] requires Commerce to apply the final results of an administrative review to all entries covered by the review. If the review did not examine a particular importer s transaction, then that importer s entries enjoy no statutory entitlement to the rates established by the review. The entries must be Court No. 13-00238 Page 22 covered by the determination to gain entitlement to the review s results as the basis for the assessment of duties. ) (quoting 19 U.S.C. § 1675(a)(2)(C) (2000)); United States v. ITT Indus., Inc., 28 CIT 1028, 1030, 343 F. Supp. 2d 1322, 1325 (2004) ( If an interested party fails to request an administrative review, Commerce generally directs Customs to liquidate merchandise at the cash deposit rates in effect at the time the merchandise entered the United States, which rate is published in the Federal Register as the all others cash deposit rate, unless the party received an individual rate in the original investigation. (internal citations omitted)). Thus, because Snap-on did not participate in a challenge to the investigation rate as applied to its entries when it had the opportunity to do so, or during any administrative review,17 it cannot benefit from the revised rate established for those entries that are the subject of the 17 See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 78 Fed. Reg. 25,423, 25,424 (Dep t Commerce May 1, 2013) (announcing opportunity to seek review of entries for the period of January 1, 2012, to December 31, 2012); Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 77 Fed. Reg. 25,679, 25,680 (May 1, 2012) (announcing opportunity to seek review of entries for period of September 7,2010, to December 31, 2011). Court No. 13-00238 litigation regarding those rates.18 Page 23 Contrary to Plaintiff s assertion, see Plaintiff s Motion for Summary Judgment at 12-13, the Laclede line of cases does not extend the applicability of the automatic assessment regulation under 19 C.F.R. § 351.212(c) to importers who do not participate in the administrative review or litigation addressing the CVD investigation, and Plaintiff does not question the validity of 19 C.F.R. § 351.212(c).19 It follows that Plaintiff is not entitled to the 137.65% revised 18 Plaintiff relies on the court of appeals decision in Shinyei Corp. v. United States, 355 F.3d 1297 (Fed. Cir. 2004), for the proposition that participation in an administrative review is not a necessary prerequisite for its section 1581(i) challenge to Commerce s liquidation instructions in this action. But Shinyei s recognition of this court s jurisdiction to hear an Administrative Procedure Act challenge to Commerce s liquidation instructions like this Court s recognition of its jurisdiction over Plaintiff s challenge here does not establish Snap-on s substantive right to the revised rate established in MacLean-Fogg for entries prior to judgment in that case. 19 Plaintiff s citation of Asociación Colombiana de Exportadores de Flores v. United States ( Ascoflores ), 916 F.2d 1571 (Fed. Cir. 1990), is also unavailing. In that case, the plaintiff successfully challenged in the CIT the dumping margin in the underlying AD order. Id. at 1575 76. The subsequent administrative review would not have addressed the issue in dispute, i.e., the validity of the calculated dumping margin in the AD order, but rather would have addressed only the rates calculated for the subsequent period of review. Id. Accordingly, the Federal Circuit found that the futility exception to the exhaustion requirement permitted the plaintiff to seek a reduced dumping margin in the AD order even though the plaintiff did not request an administrative review of its subsequent entries. Id. By contrast, Plaintiff did not participate in MacLean-Fogg IV, which is the principal case in which the Ascoflores rule could have applied to allow Plaintiff to seek relief. Thus, Ascoflores is inapposite to Plaintiff s situation. Court No. 13-00238 Page 24 rate in accordance with this court s judgment in Maclean-Fogg IV, and Commerce did not act contrary to law by instructing Customs to liquidate Plaintiff s entries at the 374.15% all others CVD rate.20 Plaintiff also argues that equity strongly supports granting its motion, since failing to do so would allow the application of a CVD rate known to be unlawful as a result of the Department s own determinations in response to MacLean-Fogg III and IV. Pl s Reply at 10. This argument ignores the fact that a CVD rate can only be challenged by the process laid out in 19 U.S.C. § 1675(a)(2)(C) and 19 C.F.R. § 351.213(b). Retrospective relief for a CVD rate that is later found to be improper is only available to parties for whom liquidation has been properly suspended by participation in this process. The fact that Snap-on s entries were not liquidated for other reasons unrelated to the MacLean-Fogg challenge places Snap-on in the same legal position as any other importer during this period that did not challenge the CVD and was therefore subject 20 Contrary to the implication of Plaintiff s argument, collateral estoppel does not apply here because the issue in this case whether Snap-on is entitled to a lower rate despite its non-participation in the investigation and subsequent litigation and despite automatic assessment under 19 C.F.R. § 351.212(c) was not presented in MacLean-Fogg IV. Cf. Consol. Textiles, Inc. v. United States, 28 CIT 1304, 1307-08, 346 F. Supp. 2d 1290, 1293 (2004) (listing factors required for collateral estoppel). Court No. 13-00238 to the 374.15% rate.21 Page 25 Granting Snap-on s motion would offer the Plaintiff a benefit that its conduct in failing to participate in either MacLean-Fogg or the administrative review suggests it did not expect or believe it deserved. Doing so might also reduce the incentive for parties to participate in administrative reviews and actively engage with the Department s procedures by holding out the prospect of free riding on challenges brought by others. These considerations both of fairness to other parties similarly situated and of protecting the statutory design of the review process weigh heavily against Snap-on s argument that it alone should benefit retrospectively from the ruling in MacLean-Fogg IV. Like the other parties that failed to participate in the review or properly challenge the all others rate, Snap-on will be subject to the proper rate on future entries, but will not gain disproportionately simply because its past entries were not liquidated for other reasons. CONCLUSION Accordingly, Defendant s motion for summary judgment is granted, and Plaintiff s motion for summary judgment is denied. Judgment will be entered accordingly. It is so ORDERED. 21 See note 15, above. Court No. 13-00238 Page 26 ______/s/ Donald C. Pogue____ Donald C. Pogue, Chief Judge Dated: New York, NY
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