Ad Hoc Shrimp Trade Action Committee v. United States , 882 F. Supp. 2d 1377 ( 2013 )

Slip Op. 13 – 4
UNITED STATES COURT OF INTERNATIONAL TRADE
AD HOC SHRIMP TRADE ACTION
COMMITTEE,
Plaintiff,
Before: Donald C. Pogue,
v.
Chief Judge
UNITED STATES,
Court No. 11-00335
Defendant,
and
HILLTOP INTERNATIONAL and OCEAN
DUKE CORP.,
Defendant-Intervenors.
OPINION AND ORDER
[Defendant’s motion to expand scope of remand granted]
Dated: January 9, 2013
Andrew W. Kentz, David A. Yocis, Jordan C. Kahn, and
Nathaniel Maandig Rickard, Picard Kentz & Rowe LLP, of Washington,
DC, for Plaintiff Ad Hoc Shrimp Trade Action Committee.
Joshua E. Kurland, Trial Attorney, Commercial Litigation
Branch, Civil Division, U.S. Department of Justice, of Washington,
DC, for Defendant. With him on the brief were Stuart F. Delery,
Principal Deputy Assistant Attorney General, Jeanne E. Davidson,
Director, and Patricia M. McCarthy, Assistant Director. Of counsel
on the brief was Melissa M. Brewer, Attorney, Office of the Chief
Counsel for Import Administration, U.S. Department of Commerce, of
Washington, DC.
Mark E. Pardo and Andrew T. Schutz, Grunfeld, Desiderio,
Lebowitz, Silverman & Klestadt LLP, of Washington, DC, for
Defendant-Intervenors Hilltop International and Ocean Duke
Corporation.
Court No. 11-00335 Page 2
Pogue, Chief Judge: Before the court is Defendant’s
motion to expand the scope of previously ordered remand
proceedings. Def.’s Partial Consent Mot. to Expand the Scope of the
Court’s Nov. 30, 2012 Remand Order, ECF No. 68 (“Def.’s Mot.”);1
see Order, Nov. 30, 2012, ECF No. 67 (remanding certain matters to
the United States Department of Commerce (“Commerce”) for
additional proceedings). Commerce moves for a court order to
permit the agency to reopen the administrative record to address
new allegations, which were submitted in connection with a request
for a changed circumstances review. Def.’s Mot. at 1-2.
Specifically, Commerce requests permission to consider newly
presented information that the agency believes could show that the
mandatory respondent in the administrative review at issue provided
false and incomplete information regarding its affiliates. Id.
Although Commerce decided not to initiate the requested changed
circumstances review, the agency requests that the court permit it
to consider these allegations in the course of the court-ordered
remand that is currently under way. Id. at 2.2 For the reasons
below, Defendant’s motion will be granted.
1
Plaintiff Ad Hoc Shrimp Trade Action Committee consents to
Defendant’s motion, while Defendant-Intervenors Hilltop
International and Ocean Duke Corporation oppose it. Def.’s Mot. at
1.
2
Cf. Home Prods. Int’l, Inc. v. United States, 633 F.3d 1369, 1377
(Fed. Cir. 2011) (“Commerce may not reopen a case while it is on
appeal until the case has been remanded by the [court].”); Ad Hoc
Comm. of AZ-NM-TX-FL Producers of Gray Portland Cement v. United
(footnote continued . . .)
Court No. 11-00335 Page 3
Commerce relies on Tokyo Kikai Seisakusho, Ltd. v. United
States, 529 F.3d 1352 (Fed. Cir. 2008) and Home Prods. Int’l, Inc.
v. United States, 633 F.3d 1369 (Fed. Cir. 2011) to support the
agency’s claim that “Commerce has inherent authority to cleanse its
proceedings where they are tainted by fraud and may reconsider a
previous determination where evidence of fraud has come to light.”
Def.’s Mot. at 2. Commerce argues that, “[h]ere, new evidence has
been brought to light that ‘calls into question the integrity of
the agency’s proceeding.’” Id. (quoting Home Prods., 633 F.3d
at 1380).
Defendant-Intervenors Hilltop International and Ocean
Duke Corporation (“Defendant-Intervenors”) oppose Defendant’s
motion to expand the scope of the remand. Def.-Ints.’ Opp’n to
Def.’s Partial Consent Mot. to Expand the Scope of the Court’s
Nov. 30, 2012 Remand Order, ECF No. 69 (“Def.-Ints.’ Opp’n”).
Defendant-Intervenors argue that Tokyo Kikai and Home Products –
the two decisions cited in Defendant’s motion – “plainly establish
that there must be a prima facie showing that the proceeding was
tainted by fraud and that this alleged fraud had a material impact
upon Commerce’s initial dumping determination,” id. at 5 (emphasis
omitted), whereas Defendant “has failed to provide even the most
cursory details concerning these allegations, nor has Defendant
States, 68 F.3d 487 (Fed. Cir. 1995) (per curiam) (“We do not
approve of Commerce’s excursion beyond the mandate of [the remand
order] . . . .”).
Court No. 11-00335 Page 4
attempted to explain how these allegations by Ad Hoc (even if
assumed to be true) would have a material impact on Commerce’s
margin calculation for Hilltop in the fifth administrative review.”
Id. at 2-3.
But neither the Tokyo Kikai nor the Home Products
decision squarely governs the issue presented here. Tokyo Kikai
dealt with a challenge to Commerce’s own decision to reopen an
administrative review proceeding before commencement of any
litigation to challenge the final results of that proceeding,
whereas Home Products addressed the question of when a court must
remand to reopen an administrative proceeding over the agency’s own
opposition to doing so. Tokyo Kikai, 529 F.3d at 1357-58;
Home Prods., 633 F.3d at 1377-78. In Tokyo Kikai, the Court of
Appeals held that “Commerce possesses inherent authority to protect
the integrity of its yearly administrative review decisions, and to
reconsider such decisions on proper notice and within a reasonable
time after learning of information indicating that the decision may
have been tainted by fraud.” Tokyo Kikai, 529 F.3d at 1361-62(footnote omitted). In Home Products, where Commerce opposed
another party’s request to reopen an administrative proceeding, the
Court of Appeals held that this Court abuses its discretion by
refusing to order a remand to reopen proceedings “where a party
brings to light clear and convincing new evidence sufficient to
make a prima facie case that the agency proceedings under review
were tainted by material fraud.” Home Prods., 633 F.3d at 1378.
Court No. 11-00335 Page 5
Thus Tokyo Kikai discussed the extent of Commerce’s authority to
reconsider a decision that had not yet been appealed to the courts,
whereas Home Products addressed the limitations upon the court’s
discretion to remand to reopen administrative proceedings when the
agency opposes the remand request. Neither decision squarely
addresses whether the court must grant or deny the Government’s
request for a voluntary remand to reopen the record of an
administrative decision that is already on appeal before the court,
which is the issue presented here.
Commerce generally has inherent authority to reopen and
reconsider its previously-conducted yearly administrative reviews
of antidumping duty orders because “[t]he power to reconsider is
inherent in the power to decide.” Tokyo Kikai, 529 F.3d at 1360(citation omitted).3 Far from requiring the sort of showing that
Defendant-Intervenors suggest is necessary for Commerce to exercise
its inherent authority to reconsider, the Court of Appeals
suggested that the exercise of this authority is appropriate where
1) newly revealed information “raised questions” about the original
3
Note that, contrary to Defendant-Intervenors’ contentions, the
Court of Appeals did not subject this power to reconsider, inherent
in the power to decide, to “a prima facie showing that the
proceeding was tainted by fraud and that this alleged fraud had a
material impact upon Commerce’s initial dumping determination.”
See Def.-Ints.’ Opp’n at 5 (emphasis omitted). The court merely
stated that “[a]n agency’s power to reconsider is even more
fundamental when, as here, it is exercised to protect the integrity
of its own proceedings from fraud.” Tokyo Kikai, 529 F.3d at 1361(emphasis added, citation omitted).
Court No. 11-00335 Page 6
proceedings,4 2) after-discovered fraud “is alleged,”5 3) Commerce
wishes “to consider” new allegations,6 or 4) Commerce “believes”
that its decision was incorrect and “wishes” to alter it.7 But
here, unlike in Tokyo Kikai, Commerce cannot simply exercise its
inherent authority to reconsider because the agency’s final
determination is already on appeal before this Court. See Home
Prods., 633 F.3d at 1377 (“Commerce may not reopen a case while it
is on appeal until the case has been remanded by the [court].”).
Commerce argues that expanding the scope of remand is
necessary because newly discovered information has the potential to
undermine the accuracy of Commerce’s calculations in the
administrative review at issue. Def.’s Mot. at 1-2. Because the
stated basis for Commerce’s remand request is concern for the
potential effect of new information, this request for remand may
appropriately be characterized as based on intervening events.8
4
Tokyo Kikai, 529 F.3d at 1360.
5
Id. at 1361 (quoting Elkem Metals, Co. v. United States, 26 CIT
234, 240, 193 F. Supp. 2d 1314, 1321 (CIT 2002)).
6
Home Prods., 633 F.3d at 1377 (“Tokyo Kikai established that
Commerce has inherent authority to reopen a case to consider new
evidence that its proceedings were tainted by fraud.”) (emphasis
added).
7
Id. at 1378 n.10 (quoting SKF USA Inc. v. United States, 254 F.3d
1022, 1028 (Fed. Cir. 2001)).
8
Although the usual examples of “intervening events” in this
context are “a new legal decision or the passage of new
legislation,” SKF, 254 F.3d at 1028, allegations of fraud also fit
comfortably into this category.
Court No. 11-00335 Page 7
Where an agency seeks remand “because of intervening events outside
of the agency’s control, . . . [a] remand is generally required if
the intervening event may affect the validity of the agency
action.” SKF, 254 F.3d at 1028 (citing Ethyl Corp. v. Browner,
989 F.2d 522, 524 (D.C. Cir. 1993) (noting “the tradition of
allowing agencies to reconsider their actions where events pending
appeal draw their decision in question”)).
“[E]ven if there are no intervening events, the agency
may request a remand (without confessing error) in order to
reconsider its previous position.” SKF, 254 F.3d at 1029. In such
situations, remand is “usually appropriate” if “the agency’s
concern is substantial and legitimate,” although “remand may be
refused if the agency’s request is frivolous or in bad faith.” Id.;
see also Nucor Corp. v. United States, __ CIT __, 612 F. Supp. 2d
1264, 1336 (2009) (“Under SKF, an agency is generally entitled to a
voluntary remand to reconsider its position, ‘if the agency’s
concern is substantial and legitimate.’”) (quoting SKF, 254 F.3d
at 1028-29). This Court has found that Commerce’s concerns are
substantial and legitimate where 1) “Commerce provided a compelling
justification for its remand request,” 2) “the need for finality –
although an important consideration – does not outweigh the
justification for voluntary remand presented by Commerce,” and
3) the “scope of Commerce’s remand request is appropriate.”
Shakeproof Assembly Components Div. of Ill. Tool Works, Inc. v.
Court No. 11-00335 Page 8
United States, 29 CIT 1516, 1522-26, 412 F. Supp. 2d 1330, 1336-39
(2005).
Here, Commerce has provided a compelling justification –
it has been presented with information sufficient to persuade the
agency that its determinations in the administrative review at
issue may have been based on information that was false or
incomplete and that further inquiry and reconsideration is
therefore warranted. Def.’s Mot. at 1-2. While Commerce does not
disclose the specific information it asks the court to permit it to
consider on remand, there is no indication of bad faith or
frivolousness. Cf. Nucor Corp., __ CIT at __, 612 F. Supp. 2d
at 1336 (granting request for voluntary remand because “the
Government must be presumed to have acted in good faith,” there was
“no evidence to substantiate any suggestion of prejudgment on the
part of Commerce,” and this was “not a case in which it can be said
that a remand to the agency would be futile”). In addition, the
need for finality does not outweigh Commerce’s justification for
seeking to consider this additional information on remand because
protecting the integrity of administrative proceedings from fraud
or material inaccuracy is among the most fundamental justifications
for disturbing the finality of agency decisions. See Tokyo Kikai,
529 F.3d at 1361. Finally, the scope of Commerce’s remand request
– to expand the scope of remand to allow Commerce to consider
certain information addressed to a discrete material issue – is
reasonable and appropriate. Accordingly, the Government’s request
Court No. 11-00335 Page 9
for an expansion of the scope of remand is based on a substantial
and legitimate concern, and should therefore be granted. See SKF,
254 F.3d at 1029; Shakeproof, 29 CIT at 1522-26, 412 F. Supp. 2d at
1336-39.
For the reasons presented, Commerce’s request to expand
the scope of remand to permit the agency to consider new evidence
concerning the question of whether Hilltop International provided
false or incomplete information regarding its affiliates in the
course of the fifth administrative review of this antidumping duty
order is GRANTED.
It is SO ORDERED.
____/s/ Donald C. Pogue_____
Donald C. Pogue, Chief Judge
Dated: January 9, 2013
New York, NY