CIT Says Commerce Must Use Original Investigation Period When Resuming Paused AD Proceeding

The Court of International Trade on April 17 said that after the Commerce Department decided to continue an antidumping duty investigation on Mexican tomatoes initially paused in 1996, it must use the original investigation period, 1995-96, and not the later period of 2018-19. Judge Jennifer Choe-Groves ruled that the statute and congressional intent are clear that when Commerce resumes a suspended AD investigation, it must stick with the original investigation period.

The judge made this finding after initially ruling that U.S. tomato grower Red Sun Farms properly requested the resumption of the investigation, even though the company made the request within 20 days of Commerce's 2019 decision to withdraw from a suspension agreement and not within 20 days of the original suspension notice in 1996.

Choe-Groves ruled that if Commerce can "repeatedly suspend an investigation over several years, it is reasonable that the interested parties might request a continuation of the investigation following each new negotiated suspension.”

The underlying AD investigation on fresh tomatoes from Mexico began 28 years ago. In 1996, the agency issued its preliminary decision finding that the tomatoes were likely to be sold in the U.S. at below fair value. Commerce and Mexican tomato growers then reached a series of four agreements in 1996, 2002, 2008 and 2013 to suspend the investigation.

In May 2019, Commerce withdrew from the 2013 suspension agreement, though it struck a new deal in September 2019. A month later, U.S. tomato growers requested that the investigation be resumed, which the agency did by picking new mandatory respondents and fielding new data from the 2018-19 period. A final determination was issued in October 2019, though a final AD order was not issued due to intervention from the U.S. Court of Appeals for the Federal Circuit, which said that the 2019 suspension agreement still held (see 2204140067).

Mexican tomato growers, led by Bioparques de Occidente, brought a 10-count suit to contest the final determination itself along with other procedural steps. Choe-Groves opened her discussion of the exporters' claims by noting that four of them were waived by the parties for failure to include them in their motions for judgment.

The waived claims challenged Commerce's authority to resume the investigation based on a withdrawal of the U.S. industry from the original petition, substitution of the product-matching methodology and calculation of general and administrative expenses.

In their non-waived claims, the Mexican exporters said that Commerce couldn't start its investigation since the request for continuation wasn't filed by an interested party within 20 days of the original notice of suspension in 1996. The judge said that nothing in the statute on requesting the resumption of a suspended investigation -- Section 1673c(g) -- "expressly" restricts an interested party from requesting a continuation of a proceeding only after the initial notice of suspension. Choe-Groves said that courts should hold off from adding conditions to the statute that don't appear in their text.

If Commerce can repeatedly suspend the investigation, interested parties can reasonably request a continuation of the investigation after each suspension, the opinion said.

The exporters also contested Commerce's use of the 2018-19 period and selection of new respondents as a violation of the statute, which says to resume the investigation "as if its affirmative preliminary determination were made on the date of its determination under this paragraph." Choe-Groves said this language is "unambiguous," and that Congress' "use of the verb 'resume' evidences an intention that Commerce should continue the investigation already begun prior to the initial suspension."

Reading the law to allow "drastic changes in the period of investigation" or selection of new respondents "would render meaningless the preliminary determination prior to the initial suspension agreement," the opinion said. Choe-Groves centered on the fact that a normal AD investigation would take at least 215 days but that a suspended investigation resumed under these procedures would see the proceeding finished within 75 days of resumption.

"This results in a compressed timeline, and newly added mandatory respondents would be limited in their ability to produce and challenge new data," the opinion said. Without the preliminary determination phase, the new respondents didn't have a chance to provide initial information to Commerce or review a preliminary decision, the judge noted.

In addition, "Congress clearly expressed its intention" for a resumed investigation to continue the proceeding started prior to suspension, "building from an existing preliminary determination." The agency can't skirt this requirement by claiming that the court should accept that the investigation was "resumed" just because the agency never used the phrase "new investigation," the judge said. While it may be "difficult" in 2024 to investigate the tomato market in 1995-96, Choe-Groves said Commerce is still required by law to resume the prior investigation.

(Bioparques de Occidente v. United States, Slip Op. 24-45, CIT Consol. # 19-00204, dated 04/17/24; Judge: Jennifer Choe-Groves; Attorneys: Jeffrey Winton of Winton & Chapman for plaintiffs led by Bioparques de Occidente; Bernd Janzen of Akin Gump for consolidated plaintiffs led by Confederacion de Asociaciones Agricolas del Estado de Sinaloa; Douglas Edelschick for defendant U.S. government; Robert Cassidy of Cassidy Levy for defendant-intervenor the Florida Tomato Exchange)