CIT Says Exporter's Entries, Not Exporter, Excluded From AD Order After Court Decision

The Court of International Trade on Nov. 21 upheld the Commerce Department's order to CBP to assess antidumping duties on exporter Goodluck India's entries subject to the third administrative review of the antidumping duty order on cold-drawn mechanical tubing of carbon and alloy steel from India despite a previous order provisionally excluding the entries from the AD order. Judge Gary Katzmann found Goodluck's previous entries, but not the exporter itself, were excluded from the order.

However, the court noted its holding in the case is "narrow," adding that it will not opine on whether a full provisional exclusion from an AD order would render a producer or exporter no longer "covered by" the order. Katzmann ultimately found that Commerce didn't violate any statutory, procedural or constitutional requirements in ordering liquidation of the entries following the review at the original 33.7% dumping rate instead of the provisional zero percent dumping rate.

Prior to the present case, Goodluck successfully challenged the 33.7% dumping rate set in the original AD investigation in a separate action at CIT, resulting in a zero percent rate for the company and presumably an exclusion from the AD order. However, the U.S. Court of Appeals for the Federal Circuit reversed the decision. After the ruling, Commerce, in a Timken notice, announced the effect of the decision and told CBP to liquidate Goodluck's entries in the third AD review at Commerce's original rate of 33.7%.

Prior to the Federal Circuit decision, Commerce had given exporters a chance to request participation in the third review. Goodluck said it had assumed it was exempted from the order when the time came to request the review based on the decision in place at the time, so it didn't request a review and a new rate when given the chance.

Goodluck said Commerce's action was inconsistent with the agency's regulations since the exporter was no longer covered by the AD order after the first decision, and at the time of the Timken notice, it had no right to request the review during the anniversary month.

The trade court disagreed. The Timken notice issued after the first CIT decision excluded "merchandise produced and exported by Goodluck," Katzmann said. That means that, while Goodluck's entries were excluded, Goodluck itself was not. "The direct object of 'excluding' in Commerce’s sentence is 'merchandise produced and exported by Goodluck,' not 'Goodluck," Katzmann said.

The company's reading that the whole company was excluded, "elides the difference between excluding a particular producer or exporter, versus excluding particular entries of that producer or exporter," the opinion said. "That distinction is crucial in a case like this, where Goodluck was still covered beyond its capacity as both a producer and an exporter.” Commerce's position isn't in violation of the plain meaning of the words "covered by" in the regulations, Katzmann said. The judge added that the interpretation isn't contrary to Commerce's regulation, 19 C.F.R. § 351.213(b)(2), which says that "producers and exporters, not their entries," are subject to review.

Goodluck also claimed that it was entitled to request the AD review at some time other than the anniversary month. Katzmann responded by saying that even if this specific stipulation wasn't found in the regulations, which it is, "it is unclear to the court why the regulation would authorize Goodluck to request AR at any point apart from the anniversary month."

And Katzmann rejected Goodluck's claim that it's Commerce's past practice to accept untimely review requests "after a party whose entries were provisionally excluded was reinstated pursuant to a conclusive court decision." He said Goodluck was cherry-picking only the parts of those proceedings to support its point. Agency decisions with "overlapping attributes" that yet "lack a clear and principled common outcome or reasoning, do not give rise to those notice concerns with equal force," the opinion said. Attempts at threading these decisions together, "as Goodluck attempts here, risk curtailing Commerce's discretion for no good reason."

Goodluck had the right to request the third review on the anniversary month of the second review but didn't "avail itself of that right," Katzmann said, rejecting Goodluck's claim that Commerce didn't provide the company with sufficient due process. The court said notice of the opportunity to request the review was made via Federal Register notice, and Goodluck was aware that the Federal Circuit decision impending at the time review requests were due could again subject it to the AD order. "Goodluck has not shown that additional processes beyond statutory and regulatory requirements were due" after the original order was reinstated. The company was aware it could be reinstated to the order after the Federal Circuit's review, the opinion said.

Goodluck also argued that, because estimated duties at the time of entry were zero percent, Commerce should have told CBP to automatically liquidate the entries subject to the third review at the zero percent rate. Katzmann ruled that granting this request now would "authorize liquidation for entries subsequent to the May 2020 Timken Notice at a rate that is not in accordance with a final decision.” The result would lead to the "undesirable 'yo-yo' or 'flip-flop effect that the Timken court discouraged," whereby a company's dumping rate is constantly changing administratively.

(Goodluck India v. U.S, Slip Op. 23-164, CIT # 22-00024, dated 11/21/23; Judge: Gary Katzmann; Attorneys: Jordan Kahn of Grunfeld Desiderio for plaintiff Goodluck India Ltd.; Ioana Meyer for defendant U.S. government; R. Alan Luberda of Kelley Drye for defendant-intervenors led by ArcelorMittal Tubular Products)