Critical Circumstances Statute Doesn't Require ITC to Only Find Post-AD Order Harm, CAFC Says

In the case, the ITC made a finding that a surge of imports of Vietnamese raw honey from after the date the AD petition was filed was likely to undermine the remedial purpose of the AD order on the honey. Following its ordinary practice, the commission analyzed a "post-petition period" that ran from six months prior to the AD investigation's preliminary determination, which is the date on which the liquidation of subject imports is suspended and importers face AD liability.

The commission said the "timing and volume of imports favored an affirmative determination," as did the rapid increase in the "inventories of the imports." After also finding that monthly price data showed that imports from Vietnam "continued to undersell domestic raw honey" during the post-petition period, the ITC imposed AD on goods imported in the 90-day period prior to the investigation's preliminary determination.

A group of importers, led by Sweet Harvest Foods, challenged this conclusion on statutory grounds, arguing that the ITC had to find the post-petition imports were likely to have an adverse impact on the period after the AD order was issued. Sweet Harvest said it's "not enough to find an adverse impact (of an import surge) starting on the date as of which the ultimately imposed duties would apply without a critical-circumstances determination, namely, the date of suspension of liquidation."

Writing for the court, Taranto rejected this claim. The judge said that if the Commerce Department has found, as it did here, that "there have been massive imports of the subject merchandise over a relatively short period," then the ITC has to find under 19 U.S.C. 1673d(b)(4)(A)(i) whether "the imports subject to the affirmative determination" are "likely to undermine seriously the remedial effect" of the AD order to be issued.

This statutory provision doesn't require a finding centered on the time after the AD order, the court held. The "remedial effect" of the AD order starts when entries are subject to the "eventually imposed duties," which is the investigation's preliminary determination. Here, that was initially Nov. 23, 2021, "before the suspension date was itself backdated in January 2022," the court noted.

A surge of imports before this date "plainly could undermine that protection by diminishing demand for their goods," either because non-subject goods have been stockpiled for sale after the duties take effect or because the non-subject goods have already been sold "so as to diminish demand for new merchandise after that date," Taranto said. Sweet Harvest's claim is "contrary to this straightforward reading of the key statutory language," the court held.

Taranto added that this conclusion is further supported by the language of the Statement of Administrative Action (SAA) for the Uruguay Round Agreements Act, which enacted the current language of the critical circumstances provisions, and the CAFC's 1987 decision in ICC Industries v. U.S. The SAA says a "relatively short period of time" in assessing critical circumstances is a period "prior to the suspension of liquidation."

And in ICC Industries, the court addressed the original version of the relevant statutes and quoted the House Report on the law, which said section 1673d(b)(4)(A) was meant to deter circumvention of the AD order through post-petition import surges. Nothing in the "now-governing language alters the evident and recognized purpose" of the statute, Taranto said.

Sweet Harvest also argued that the critical circumstances finding isn't supported by substantial evidence. The importer's argument related to its statutory claim in that the company argued that the ITC failed to account for the fact that the data showed any import surge during the post-petition period was consumed in the U.S. and not entered into the importers' inventories, indicating the imports aren't threatening to undermine the remedial nature of the AD order (see 2509030066).

The ITC noted that aggregate inventories nearly tripled during the post-petition period and that demand for raw honey is "relatively inelastic," making it likely that the increased imports and inventories of subject goods "remained in inventory somewhere in the supply chain and were not immediately consumed." Thus, the commission said inventories of the imports were "large and increased substantially in the post-petition period" even if importers themselves sold off much of their inventory.

The ITC concluded that the import surge "was likely to place downward pressure on prices regardless of where imports were in the supply chain."

Taranto sustained this reasoning as "reasonable," noting "significant deficiencies" in Sweet Harvest's evidence on this claim. The ITC also noted that Sweet Harvest's focus solely on the inventory of "importers" was "too narrow," since inventories of purchasers "mattered too," and the overall "large" inventories "would diminish demand for new purchases," the judge said.

The court held that this isn't a case "in which there is a failure to discuss evidence of such critical importance to the fact in dispute that we cannot discern the agency’s reasoning or cannot find the agency’s findings of fact to be reasonable without more explanation."

(Sweet Harvest Foods v. United States, Fed. Cir. # 24-1371, dated 10/15/25; Judges: Alan Lourie, Richard Taranto and Tiffany Cunningham; Attorneys: Ron Kendler of White & Case for plaintiff-appellants led by Sweet Harvest; Michael Haldenstein for defendant-appellee U.S. government; Melissa Brewer of Kelley Drye for defendants-appellees American Honey Producers Association and Sioux Honey Association)