Gleason Industrial Products, Inc. v. United States , 31 Ct. Int'l Trade 393 ( 2007 )

Slip Op. 07-40
UNITED STATES COURT OF INTERNATIONAL TRADE
GLEASON INDUSTRIAL PRODUCTS,
INC. and PRECISION PRODUCTS,
INC.,
Plaintiffs, Before: Richard W. Goldberg,
Senior Judge
v.
UNITED STATES, Court No. 06-00089
Defendant,
and
CENTRAL PURCHASING, LLC,
Defendant-
Intervenor.
OPINION
[Commerce’s motion for voluntary remand is granted. Plaintiff’s
USCIT Rule 56.2 motion denied as moot.]
Dated: March 16, 2007
Crowell & Moring, LLP (Matthew P. Jaffe) for Plaintiffs Gleason
Industrial Products, Inc. and Precision Products, Inc.
Adduci, Mastriani & Schaumberg, LLP (Louis S. Mastriani, William
C. Sjoberg) for Defendant-Intervenor Central Purchasing, LLC.
Peter D. Keisler, Assistant Attorney General; Patricia M.
McCarthy, Assistant Director, Commercial Litigation Branch,
Civil Division, U.S. Department of Justice (Stephen C. Tosini);
Office of the Chief Counsel, U.S. Department of Commerce (Carrie
Lee Owens), of counsel, for Defendant United States.
GOLDBERG, Senior Judge: Plaintiffs Gleason Industrial Products,
Inc. and Precision Products, Inc. (collectively “Gleason”) move
Court No. 06-0089 Page 2
the Court to enter judgment on the agency record pursuant to
USCIT Rule 56.2. Defendant U.S. Department of Commerce
(“Commerce”) moves the Court on its own accord to remand the
matter back to the agency. Defendant-Intervenor Central
Purchasing, LLC (“CP”) opposes both motions. For the reasons
that follow, the Court grants Commerce’s request for a voluntary
remand.
I. BACKGROUND
On December 2, 2004, Commerce entered an antidumping duty
order relating to hand trucks produced in China. See Hand
Trucks and Certain Parts Thereof from the People’s Republic of
China, 69 Fed. Reg. 70122 (Dep’t Commerce Dec. 2, 2004) (Notice
of Antidumping Duty Order) (“Antidumping Duty Order”). The
notice defined the scope of the antidumping duty order as
follows:
The merchandise subject to this antidumping duty order
consists of hand trucks manufactured from any
material, whether assembled or unassembled, complete
or incomplete, suitable for any use, and certain parts
thereof, namely the vertical frame, the handling area,
and the projecting edges or toe plate, and any
combination thereof.
A complete or fully assembled hand truck is a hand-
propelled barrow consisting of a vertically disposed
frame having a handle or more than one handle at or
near the upper section of the vertical frame; at least
two wheels at or near the lower section of the
vertical frame; and a horizontal projecting edge or
edges, or toe plate, perpendicular or angled to the
vertical frame, at or near the lower section of the
vertical frame. The projecting edge or edges, or toe
Court No. 06-0089 Page 3
plate, slides under a load for purposes of lifting
and/or moving the load.
That the vertical frame can be converted from a
vertical setting to a horizontal setting, then
operated in that horizontal setting as a platform, is
not a basis for exclusion of the hand truck from the
scope of this petition. That the vertical frame,
handling area, wheels, projecting edges or other parts
of the hand truck can be collapsed or folded is not a
basis for exclusion of the hand truck from the scope
of the petition. That other wheels may be connected
to the vertical frame, handling area, projecting
edges, or other parts of the hand truck, in addition
to the two or more wheels located at or near the lower
section of the vertical frame, is not a basis for
exclusion of the hand truck from the scope of the
petition. Finally, that the hand truck may exhibit
physical characteristics in addition to the vertical
frame, the handling area, the projecting edges or toe
plate, and the two wheels at or near the lower section
of the vertical frame, is not a basis for exclusion of
the hand truck from the scope of the petition.
Examples of names commonly used to reference hand
trucks are hand truck, convertible hand truck,
appliance hand truck, cylinder hand truck, bag truck,
dolly, or hand trolley. They are typically imported
under heading 8716.80.50.10 of the Harmonized Tariff
Schedule of the United States (“HTSUS”) although they
may also be imported under heading 8716.80.50.90.
Specific parts of a hand truck, namely the vertical
frame, the handling area and the projecting edges or
toe plate, or any combination thereof, are typically
imported under heading 8716.90.50.60 of the HTSUS.
Although the HTSUS subheadings are provided for
convenience and customs purposes, [Commerce’s] written
description of the scope is dispositive.
Excluded from the scope are small two-wheel or four-
wheel utility carts specifically designed for carrying
loads like personal bags or luggage in which the frame
is made from telescoping tubular material measuring
less than 5/8 inch in diameter; hand trucks that use
motorized operations either to move the hand truck
from one location to the next or to assist in the
lifting of items placed on the hand truck; vertical
Court No. 06-0089 Page 4
carriers designed specifically to transport golf bags;
and wheels and tires used in the manufacture of hand
trucks.
Id. On December 19, 2005, CP sent a letter to Commerce seeking
a scope ruling that excluded its welding carts from the scope of
the antidumping duty order. The letter provided the following
description of the two models at issue here:
Both carts are made in China, don’t have projected
edges and are designed to carry welding machines only.
. . . Please consider in your ruling that both have a
specialized purpose which can not be utilized as a
standard hand truck for which the original order is
written and neither cart has projecting edges.
Letter from Heidar Nuristani, Compliance Specialist, Central
Purchasing, LLC, to Secretary of Commerce at 1, 3 (Dec. 19,
2005). CP included several photographs of the welding carts at
issue with their letter.
Gleason opposed CP’s request on three grounds. First,
Gleason argued the CP welding carts fell squarely within the
description of hand carts contained in the antidumping duty
order. See Letter from Matthew P. Jaffe, Counsel for Gleason,
to Secretary of Commerce at 2 (Jan. 4, 2006) (“Gleason Letter”).
Second, Gleason claimed CP’s functional argument (i.e., the
carts are not covered because they are “designed to carry
welding machines only”) lacked any relevance to the legal
question of the applicability vel non of the antidumping duty
order to the CP carts. See id. at 3. Lastly, Gleason posited
Court No. 06-0089 Page 5
that because its original antidumping petition included
pictorial representations of “cylinder hand trucks” similar to
the CP welding carts, such trucks were, in effect, incorporated
into the scope of the antidumping order. See id. at 3-4.
Commerce responded by granting CP’s request. See Final
Scope Ruling for Central Purchasing, LLC’s Two Models of Welding
Carts (Feb. 15, 2006). In its scope ruling, Commerce explained
its rationale:
From the description and pictures Central Purchasing
provided, the welding carts do not have a toe plate
that could slide under a load, an essential
characteristic as described in the scope of this
order. Generally, a toe plate is positioned on the
hand truck perpendicular to the vertical frame and
flush with the ground to facilitate movement of an
object onto the cart. The projected edges on the
welding carts rise at least a half inch above the
ground. At this height the projected edges on these
welding carts are not able to slide under a load. In
addition, the toe plates are supported by two bars
that restrict the width of objects that can be loaded
and carried on the carts. Thus, the welding carts
possess only two of the three key physical
characteristics as the subject hand trucks defined in
the scope of the order. Therefore, we determine that
the welding carts do not possess all of the
characteristics of a hand truck as described in the
scope of this order.
Id. at 5 (citation omitted). In response to Gleason’s third
argument, Commerce found that “the written description, not the
pictures, is dispositive of what is included in the scope of the
order.” Id. Though it acknowledged the importance of pictorial
representations during the administrative investigation,
Court No. 06-0089 Page 6
Commerce claimed that they were ultimately assistive and
illustrative, and that the verbal description controlled. See
id. at 5-6.
Gleason then timely commenced an action pursuant to 19
U.S.C. § 1516a, seeking to challenge Commerce’s scope ruling.
Gleason filed a motion for judgment on the agency record on
August 25, 2006. Three months later, Commerce shifted gears,
and requested a voluntary remand so as to “reconsider its
previous position in light of arguments made by plaintiffs . . .
.” Def.’s Resp. Pl.’s Mot. J. Agency R. and Req. Vol. Remand 1
(“Def.’s Mot.”). In its reply brief, Gleason has consented to
the voluntary remand. CP, however, objects not only to
Gleason’s motion for judgment on the agency record, but also to
Commerce’s remand request.
II. STANDARD OF REVIEW
Where an agency requests remand without confessing error in
order to reconsider its previous position, “the reviewing court
has discretion over whether to remand.” SKF USA, Inc. v. United
States, 254 F.3d 1022, 1029 (Fed. Cir. 2001); see also
Shakeproof Assembly Components Div. of Ill. Tool Works, Inc. v.
United States, 29 CIT ___, ___, 412 F. Supp. 2d 1330, 1335
(2005). “The SKF court further noted that remand is generally
appropriate ‘if the agency’s concern is substantial and
legitimate[,]’ but may be refused ‘if the agency’s request is
Court No. 06-0089 Page 7
frivolous or in bad faith.’” Shakeproof, 29 CIT at ___, 412 F.
Supp. 2d at 1335 (quoting SKF, 254 F.3d at 1029). A reviewing
court’s function is to screen out those frivolous and bad faith
remand requests that compromise litigants’ legitimate concerns
for finality. See Corus Staal, BV v. U.S. Dep’t of Commerce, 27
CIT 388, 391, 259 F. Supp. 2d 1253, 1257 (2003) (suggesting that
“merely a change in policy” will not justify a voluntary remand
over an interested party’s objection). When, however, the
agency requests remand to correct a mistake or address some
other substantial and legitimate concern, it is far more
sensible for a court to defer to the agency whose expertise,
after all, consists of administering the statute.
III. DISCUSSION
It is first necessary to establish why Commerce is
acquiescing to remand. In its motion seeking voluntary remand,
Commerce “respectfully request[s] that the Court issue the
attached order granting Commerce a voluntary remand to allow it
to reconsider its determination.” Def.’s Mot. 4. According to
Commerce, such reconsideration is necessary because “Gleason has
elaborated upon certain arguments and raises issues that should
be further reviewed by the agency.” Id. Specifically, Commerce
claims that two issues require reconsideration: (1) whether the
CP welding carts have a projecting edge that easily slides under
a load; and (2) whether CP’s welding carts are “cylinder hand
Court No. 06-0089 Page 8
trucks,” which are specifically included within the scope of the
order. Id. 5-6.
As for the projecting edge of the CP welding carts,
Commerce was impressed by Gleason’s explanation in its scope
request of how the carts’ projecting edges can slide under a
load despite not being flush with the ground. Id. 5. In
particular, Commerce cited Gleason’s claim that the half-inch
elevation of the toe plate “can actually ‘assist individuals as
they slide the toe plate of a hand truck under a cylinder
especially where the bottom surface of the cylinder is curved.’”
Def.’s Mot. 6 (quoting Pl.’s Mot. J. Agency R. 12). Thus,
Commerce’s first reason is to engage in a more searching
examination of the role played by the elevated toe plate.
Regarding the inclusion of the pictorial representation of
cylinder hand trucks, Commerce seeks leave to explore further
Gleason’s argument that the carts represented in the pictorial
exhibits are examples of “cylinder hand trucks,” which are
specifically referenced in the scope description of the
underlying antidumping duty order. Id. 7 (citing Antidumping
Duty Order, 69 Fed. Reg. at 70122).
In response to Commerce’s first reason, CP contends that
the Vertex International, Inc. v. United States decision
forecloses any further consideration of the applicability vel
non of the antidumping duty order to the CP welding carts. See
Court No. 06-0089 Page 9
Def.-Int.’s Mem. Opp. Def.’s Req. Vol. Remand and Pl.’s Mot. J.
Agency R. 12-14. In response to Commerce’s second reason, CP
argues that the inclusion of “cylinder hand trucks” as an
example of a hand truck within the scope of the antidumping
order is “meaningless,” and that the Court should focus
exclusively on the “three essential elements” of a hand truck.
Id. 15.
Commerce is entitled to a remand on both grounds because
the concerns raised are substantial and legitimate, and free
from any semblance of bad faith. The Vertex International court
was faced with a similar question to that posed in this
litigation: whether a variety of cart could slide under a load.
See Vertex Int’l, Inc. v. United States, 30 CIT ___, ___, Slip
Op. 06-10 at 10-12 (Jan. 19, 2006). The Vertex International
court found that the Antidumping Duty Order did not apply to a
specific variety of garden carts. Id. at 12. The projecting
edge of that garden cart was made of round steel wire. Id.
Significantly, the operation instructions for the garden carts
warned that pushing the cart could damage the product or even
cause bodily injury to the operator. Id. at 11. Since the toe
plates of the hand trucks covered by the antidumping duty order
had to be pushed in order to slide under a load, see Antidumping
Duty Order, 69 Fed. Reg. at 70122, the garden carts fell outside
Court No. 06-0089 Page 10
the order’s scope. See Vertex Int’l, 30 CIT at ___, Slip Op.
06-10 at 12-14.
CP’s reliance on Vertex International is misplaced. CP’s
welding carts are drastically different than the Vertex
International plaintiff’s garden carts. Vertex International
does focus the attention of the agency and reviewing courts on
the requirement that a hand truck must be able to slide under a
load in order to fall within the purview of the Antidumping Duty
Order, but it does not purport to answer that question for any
product other than the garden cart at issue in the case. Vertex
International frames the issue for this Court, but it hardly
decides it. In this case, Commerce seeks remand to conduct a
more searching factual examination of whether the elevated toe
plates of the CP welding carts help to slide the carts under
loads. In other words, Commerce is seeking leave to conduct
precisely the sort of inquiry that the Vertex International
decision demands.
CP’s second argument is equally unavailing. It is of
course true that the explicit terms of the Antidumping Duty
Order must control the agency’s subsequent decisions in scope
rulings. See Duferco Steel, Inc. v. United States, 296 F.3d
1087, 1096-97 (Fed. Cir. 2002). Commerce’s remand request in no
way controverts that plain principle. Instead, Commerce is
seeking to determine if the CP welding carts are
Court No. 06-0089 Page 11
”cylinder hand trucks.” The designation is crucial to a
complete and correct resolution to the scope litigation in this
case because the Antidumping Duty Order specifically lists
“cylinder hand truck” as a name “commonly used to reference hand
trucks.” Antidumping Duty Order, 69 Fed. Reg. at 70122. As
such, if Commerce makes the factual finding that the CP welding
carts are cylinder hand trucks, then the Antidumping Duty
Order’s express terms may require an assessment of antidumping
duties on those carts. Gleason itself did not clearly express
this argument at the administrative level, and it persuaded
Commerce only after presenting a more compelling argument in its
Rule 56.2 brief. Compare Gleason Letter at 3-4 (arguing
pictorial exhibits to petition necessarily formed part of the
order’s scope) with Pl.’s Mot. J. Agency R. 14-16 (arguing that
“the pictorial exhibits that form part of the petition impart
material substance to the written scope description,
specifically what is meant by the term ‘cylinder hand truck’”).
Reconsidering that designation is a substantial and legitimate
concern that the agency should be permitted to make on its own
before the judiciary passes its judgment on the matter.
IV. CONCLUSION
Because Commerce’s request for a voluntary remand aims to
address substantial and legitimate concerns, and because there
are no indicia of bad faith, the Court will grant Commerce’s
Court No. 06-0089 Page 12
motion. In light of the remand, Gleason’s motion for judgment
on the agency record is denied as moot.
/s/ Richard W. Goldberg__
Richard W. Goldberg
Senior Judge
Dated: March 16, 2007
New York, New York
UNITED STATES COURT OF INTERNATIONAL TRADE
GLEASON INDUSTRIAL PRODUCTS,
INC., and PRECISION PRODUCTS,
INC.,
Plaintiffs, Before: Richard W. Goldberg,
Senior Judge
v.
Court No. 06-00089
UNITED STATES,
Defendant,
and
CENTRAL PURCHASING, LLC,
Defendant-
Intervenor.
ORDER
Upon consideration of defendant’s partial consent motion
for voluntary remand and all other pertinent papers, and upon
due deliberation, it is hereby
ORDERED that defendant’s motion is GRANTED; and it is
further
ORDERED that plaintiff’s motion for judgment on the agency
record is DENIED as moot; and it is further
ORDERED that this case is remanded to defendant for
reconsideration of (1) whether CP’s welding carts have a
projecting edge that easily slides under a load and (2) whether
welding carts are specifically included within the scope of the
order due to the mention of “cylinder hand trucks”; and it is
further
ORDERED that defendant shall file its remand results with
the Court by June 14, 2007; and it is further
ORDERED that parties shall have until July 16, 2007 to file
comments on the remand results; and it is further
ORDERED that parties shall have until July 31, 2007 to file
any responses to the comments.
SO ORDERED.
/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge
Date: March 16, 2007
New York, New York