US Says ‘Residual’ Jurisdiction Unavailable Even If Delay for Other Types Reduces Remedy
In a March 18 brief supporting a Jan. 24 motion to dismiss (see 2401230040), the U.S. again argued in a case involving the antidumping and countervailing duty pause on Southeast Asian solar panels that the Court of International Trade lacks jurisdiction under 28 U.S.C. § 1581(i) because it “is, or could have been” available under 28 U.S.C. § 1581(c) (Auxin Solar v. U.S., CIT # 23-00274).
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It said a remedy would have still been available to the plaintiffs, domestic producers, if they had filed under the correct jurisdiction to begin with. Though the producers argued that merchandise worth $2 billion would have been liquidated by the time they could have brought their case under § 1581(c), the remaining entries would still have been worth more than $19 billion, it said.
The government’s brief comes amid a case brought by solar cell maker Auxin Solar and solar module designer Concept Clean Energy, challenging the AD/CVD pause on solar cells and models from several Southeast Asian countries after those countries were found to be transshipping through China (see 2401030071).
In opposition to the government’s Jan. 24 motion, Auxin Solar and Concept Clean Energy argued that the heart of their case rests in challenging Commerce’s “failure to ‘enforce’” the AD/CVD duties, which is better heard under § 1581(i) (see 2402230066).
However, the U.S. said in its March 18 filing that dismissal was necessary because jurisdiction could have been available under § 1581(c) and “the remedies available pursuant to that statute are not manifestly inadequate.”
The government took issue with the plaintiffs’ claim that remedies under Section 1581(c) were “manifestly inadequate,” as “they estimate that approximately $2 billion worth of entries of merchandise could have been liquidated” before a § 1581(c) case could have been filed.
“Although this sum is substantial, the test for manifest inadequacy is not measured in terms of the value of merchandise,” it said.
A remedy is “manifestly inadequate” if it is an “exercise in futility, or incapable of producing any such result; failing utterly of the desired end through intrinsic defect; useless, ineffectual, vain,” the government said. Thus the standard for “manifestly inadequate” is not “‘anything less than full relief,’” it said.
A remedy under a Section 1581(c) case would still have been available because more than $19 billion worth of merchandise would still be unliquidated by the start of trial, the government said. A court order to set aside the duty pause would still affect all that remaining merchandise, it said.
The government also argued that the “true nature” of the case is a challenge to Commerce’s circumvention inquiry’s findings that held that those exporters’ otherwise-required duties should be suspended under the final rule setting the duty pause.
To evaluate the “true nature” of an action, the court must consider “whether the challenged action is consistent or inconsistent with a determination reviewable under section 1581(c),” DOJ said.
In this case, the plaintiffs are challenging the application and lawfulness of the Duty Suspension Rule, which the department had addressed in the final determinations of its circumvention inquiries, it said. This means that the action is directed at the determinations themselves, not liquidation instructions, it said.
It said jurisdiction under § 1581(i) “depends upon whether or not Commerce’s instructions to Customs ‘are inconsistent with or contain a legal error that is distinct from Commerce’s determination.’”
DOJ also said that the plaintiffs were asking CIT to hold, “for the first time,” that two different challenges to one final determination must be made in two separate lawsuits, one under Section 1581(i) and one under Section 1581(c). But this would result in “piecemeal litigation,” it said.
Finally, the government said that plaintiffs “incorrectly” claimed that Commerce did not allow comments from interested parties during its circumvention investigation.
Actually, the department allowed “‘all’ arguments they wished to make,” and Auxin Solar did submit some arguments that were then “substantively addressed” by Commerce, it said. It said this was demonstrated in the department’s February 2023 briefing schedule letter, also cited by plaintiffs, which established a schedule for brief submissions in “two tranches,” the latter designated for “all … other issues.”
The fact that Commerce hadn't put several ex parte communications on the record didn't preclude Auxin Solar or Concept Clean Energy from commenting on them, rendering a completeness argument moot, it added.
The government also said that the plaintiffs had argued, “somewhat confusingly, that they were precluded from making arguments about whether the Duty Suspension Rule was lawful because Commerce ultimately decided to apply the Duty Suspension Rule in the final determinations.”
This argument, that Commerce had “‘simply and summarily’ rejected their arguments,” did not hold water, it said. The department “committed nearly three single-spaced pages of each IDM to a substantive legal analysis addressing arguments about the Duty Suspension Rule,” it said.