GPX International Tire Corp. v. United States , 70 F. Supp. 3d 1266 ( 2015 )

Slip Op. 15-46
UNITED STATES COURT OF INTERNATIONAL TRADE
GPX INTERNATIONAL TIRE
CORPORATION and HEBEI STARBRIGHT
TIRE CO., LTD.,
Plaintiffs,
TIANJIN UNITED TIRE & RUBBER
INTERNATIONAL CO., LTD.,
Consolidated Plaintiff,
v. Before: Jane A. Restani, Judge
UNITED STATES, Consol. Court No. 08-00285
Defendant,
and
BRIDGESTONE AMERICAS, INC.,
BRIDGESTONE AMERICAS TIRE
OPERATIONS, LLC, TITAN TIRE
CORPORATION, and UNITED STEEL,
PAPER AND FORESTRY, RUBBER,
MANUFACTURING, ENERGY, ALLIED
INDUSTRIAL AND SERVICE WORKERS
INTERNATIONAL UNION, AFL-CIO-CLC,
Defendant-Intervenors.
[Consolidated plaintiff’s motion for enforcement of the judgment is granted.]
OPINION AND ORDER
Dated: May 18, 2015
Mark B. Lehnardt, Lehnardt & Lehnardt, LLC, of Liberty, MO, for consolidated plaintiff
Tianjin United Tire & Rubber International Co., Ltd.
Consol. Court No. 08-00285 Page 2
Alexander V. Sverdlov, Trial Attorney, Commercial Litigation Branch, Civil Division,
U.S. Department of Justice, of Washington, DC, for defendant. With him on the brief were
Joyce R. Branda, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Franklin
E. White, Jr., Assistant Director. Of counsel on the brief were Daniel J. Calhoun, Senior
Counsel, and Devin S. Sikes, Attorney, Office of the Chief Counsel for Trade Enforcement &
Compliance, U.S. Department of Commerce, of Washington, DC.
Elizabeth J. Drake, Terence P. Stewart, and Philip A. Butler, Stewart and Stewart, of
Washington, DC, for defendant-intervenor Titan Tire Corporation.
RESTANI, Judge: The U.S. Department of Commerce (“Commerce”) is attempting to
collect cash deposits at a rate the court has already determined to be invalid. Consolidated
plaintiff, Tianjin United Tire & Rubber International Co., Ltd. (“TUTRIC”), brings the current
motion for enforcement of the court’s judgment entered October 30, 2013, and argues that under
either the court’s inherent power to enforce its judgments or through a writ of mandamus, the
court should compel defendant, the United States, by and through its executive administrative
agency, Commerce, to issue a corrected notice required by 19 U.S.C. § 1516a (2012) (also
referred to as a “Timken Notice”).1 TUTRIC asks that the Timken Notice state an intent to
instruct U.S. Customs and Border Protection (“CBP”) to require cash deposits for estimated
countervailing duties (“CVD”) at 3.93% for TUTRIC’s merchandise subject to the CVD order
on Off-the-Road Tires from the People’s Republic of China, Certain New Pneumatic Off-the-
1
The Timken Notice gets its name from Timken Co. v. United States, 893 F.2d 337, 340
(Fed. Cir. 1990), because in that case the Federal Circuit established the parameters of 19 U.S.C.
§ 1516a(c)(1) notice publication, which requires Commerce to publish notice of a court decision
“not in harmony” with an original agency determination. The notice had the effect of preventing
liquidation of post-notice entries at the erroneous rate. 19 U.S.C. § 1516a(e)(1). A court ordered
injunction will prevent liquidation pending litigation and normally applies to earlier entries as
well. 19 U.S.C. § 1516a(c)(2), (e)(2). Such an order originally was issued in this matter on
August 13, 2010, prohibiting liquidation of entries dated December 17, 2007 forward. See
Statutory Inj. Order, ECF No. 324 (“Statutory Inj. Order”).
Consol. Court No. 08-00285 Page 3
Road Tires From the People’s Republic of China: Countervailing Duty Order, 73 Fed. Reg.
51,627 (Dep’t Commerce Sept. 4, 2008) (“OTR CVD Order”), and compelling CBP to refund
excess cash deposits collected after October 30, 2013. The government argues that under the
Final Results of Redetermination Pursuant to Remand, ECF No. 394 (“Remand Results”),
sustained by the court, Commerce properly ordered CBP to collect cash deposits at the 6.85%
rate set in the intervening Implementation of Determinations Under Section 129 of the Uruguay
Round Agreements Act: Certain New Pneumatic Off-the-Road Tires; Circular Welded Carbon
Quality Steel Pipe; Laminated Woven Sacks; and Light-Walled Rectangular Pipe and Tube From
the People’s Republic of China, 77 Fed. Reg. 52,683 (Dep’t Commerce Aug. 30, 2012) (“Section
129 Implementation”), for all entries entered or withdrawn from the warehouse for consumption
on or after August 21, 2012.
The Remand Results reduced TUTRIC’s CVD rate to 3.93%, which is inconsistent with
Commerce’s decision to continue to require cash deposits at almost double that rate. Further,
TUTRIC did not have notice of Commerce’s intent to interpret the Section 129 Implementation
as rendering moot any court determination of a new cash deposit rate sufficient to warrant
denying TUTRIC’s current motion. Additionally, defendant-intervenor Titan Tire Corporation
(“Titan”), the party with potentially the most to lose from a reduction in TUTRIC’s CVD rate,
will not be prejudiced by enforcing the court’s order. The court has the authority to interpret its
own orders. The words of the Remand Results and the context demonstrate that the effect of the
court’s sustaining of the Remand Results was not, as Commerce contends, to sustain the use of
an erroneous 6.85% cash deposit rate for TUTRIC, but rather to set the rate for TUTRIC at
3.93%, as determined in the Remand Results. Accordingly, Commerce shall issue a revised
Consol. Court No. 08-00285 Page 4
Timken Notice setting the cash deposit rate for TUTRIC at 3.93%.
BACKGROUND
The court presumes familiarity with the facts of the underlying case as set out in GPX
International Tire Corp. v. United States, 942 F. Supp. 2d 1343, 1347–48 (CIT 2013) (“GPX
VIII”), and GPX International Tire Corp. v. United States, 893 F. Supp. 2d 1296, 1304–06 (CIT
2013) (“GPX VII”), aff’d, 780 F.3d 1136 (Fed. Cir. 2015). For ease of understanding, however,
a brief summary is provided below.
On September 4, 2008, Commerce issued a CVD order on OTR Tires from China. OTR
CVD Order, 73 Fed. Reg. 51,627. Plaintiffs challenged the order at the United States Court of
International Trade (“CIT”) on several grounds, including Commerce’s determination that
TUTRIC was subsidized because it did not repay certain government loans. During the
pendency of the domestic litigation, the Government of China brought a case against the United
States at the World Trade Organization (“WTO”) challenging the applicability of the United
States’ CVD law to China. See Appellate Body Report, United States—Definitive Anti-
Dumping and Countervailing Duties on Certain Products from China, WT/DS379/AB/R (Mar.
11, 2011). The Appellate Body eventually issued a ruling that the United States was out of
compliance with its WTO obligations on four issues: 1) benchmarks for loan benefits, 2) trading
companies, 3) public bodies, and 4) double counting. See id. at ¶ 611; Section 129
Implementation, 77 Fed. Reg. at 52,683–84. After conferring with Congress, the U.S. Trade
Representative (“USTR”) instructed Commerce to implement the WTO’s ruling under Section
129 of the Uruguay Round Agreements Act, Pub. L. No. 103-465, § 129, 108 Stat. 4809,
4836–39 (1994) (“Section 129”). Section 129 Implementation, 77 Fed. Reg. at 52,684.
Consol. Court No. 08-00285 Page 5
Commerce issued the Section 129 Implementation on August 30, 2012.
The Section 129 Implementation specifically stated that as per USTR’s instruction, it was
to implement its determinations under section 129 of the Uruguay Round
Agreements Act (“URAA”) regarding the antidumping and countervailing duty
investigations on certain new pneumatic off-the-road tires (“OTR Tires”) from the
. . . PRC . . . which renders them not inconsistent with the [WTO] dispute settlement
findings in United States—Definitive Anti-Dumping and Countervailing Duties on
Certain Products from China, WT/DS379/AB/R (March 11, 2011) (“DS 379”).
Id. at 52, 683. The Section 129 Implementation also stated that when Commerce informed the
interested parties that it was initiating proceedings under Section 129 on August 22, 2011, that it
was doing so “to implement the findings of the WTO dispute settlement panel in DS 379 with
regard to the [CVD] investigations on OTR Tires.” Id. TUTRIC’s “revised” CVD cash deposit
rate in the Section 129 Implementation was identical to that set in the OTR CVD Order, namely
6.85%.2 Id. at 52,685; see OTR CVD Order, 73 Fed. Reg. at 51,629. Both the Section 129
Implementation as well as the original OTR CVD Order also set a rate for “All Others.” Section
129 Implementation, 77 Fed. Reg. at 52,685; OTR CVD Order, 73 Fed. Reg. at 51,629.
Although it had referred to the “new” rates set in the Section 129 Implementation as “amended”
and “revised,” Commerce stated its intention to apply the “appropriate” cash deposit rates
prospectively as mandated by Section 129. Section 129 Implementation, 77 Fed. Reg. at 52,688.
It did not specify that those “appropriate” rates were the “amended” or “revised” rates calculated
in the Section 129 Implementation, or for that matter “unamended” or “unrevised” rates, such as
TUTRIC’s.
2
In the Section 129 Implementation Commerce modified TUTRIC’s antidumping
(“AD”) duty rate from 8.44% to 8.39%. 77 Fed. Reg. at 52,686. This downward amendment
was not based on the loan repayment subsidy aspect of the CVD rate. See infra note 12.
Consol. Court No. 08-00285 Page 6
All the while, TUTRIC continued to challenge a separate and distinct CVD rate
calculation issue at the CIT, i.e., that certain non-recurring loans were improperly included when
its rate was calculated because the loans had been partially repaid or were not a government
benefit. See GPX VII, 893 F. Supp. 2d at 1331–34. On remand, ordered four months after the
publication of the Section 129 Implementation, Commerce determined that some of TUTRIC’s
loans in fact had been partially repaid and reduced its CVD rate accordingly to 3.93%. Remand
Results at 30–31. On October 30, 2013, over a year after the publication of the Section 129
Implementation, the court sustained Commerce’s Remand Results.3 GPX VIII, 942 F. Supp. 2d
at 1362. In the body of the Remand Results, after discussing the new rate for TUTRIC,
Commerce indicated that “should the Court sustain [the] remand redetermination, the cash
deposit rates in effect for subsequent entries will continue to be based on the intervening
administrative review for Starbright and the intervening [Section 129 Implementation] for all
other respondents.” Remand Results at 50–51. Commerce did not say “all other respondents,
including TUTRIC.” None of the parties addressed the impact of the Section 129
Implementation on the court’s ruling at oral argument where TUTRIC’s rate was discussed in
3
The conclusion of the Remand Results stated without specific limitation:
Based on the forgoing analysis and discussion, [Commerce] has decided, pursuant
to the remand order of the Court, to recalculate the subsidy rate for TUTRIC’s debt
forgiveness, as well as its total countervailable subsidy rate. Because TUTRIC’s
challenge on the debt forgiveness issue did not encompass a challenge to the all-
others rate, we have not recalculated the all-others rate. For the foregoing reasons,
we will maintain the remainder of our determinations with the addition of the
clarifying explanations noted above.
Remand Results at 51.
Consol. Court No. 08-00285 Page 7
detail, nor did they comment on this issue following the Remand Results. See Mot. for
Enforcement of the J. 8, ECF No. 433 (“Pl. Br.”); Def.’s Resp. in Opp’n to Consol. Pl.’s Mot. for
Enforcement of the Ct.’s J. 6, 23, ECF No. 436 (“Gov. Br.”). On November 27, 2013,
Commerce issued its Timken Notice and for the first time, explicitly stated that CBP was
instructed to continue to collect CVD cash deposits from TUTRIC at 6.85%, claiming that the
Section 129 Implementation had set a new rate for TUTRIC that was not impacted by the court’s
order sustaining the 3.93% rate. See Certain New Pneumatic Off-the-Road Tires From the
People’s Republic of China: Notice of Decision of the Court of International Trade Not in
Harmony and Notice of Amended Final Determination, 78 Fed. Reg. 70,917, 70,917–18 (Dep’t
Commerce Nov. 27, 2013) (“OTR Timken Notice”).
TUTRIC initially brought a separate action seeking a writ of mandamus compelling
Commerce to issue a revised Timken Notice with instructions to CBP to collect cash deposits at
the 3.93% rate sustained by the court. See Tianjin United Tire & Rubber Co. v. United States,
Court No. 14-00176. TUTRIC subsequently voluntarily dismissed that separate action and
instead brought the current motion to enforce the court’s October 30, 2013, judgment and an
alternative petition for a writ of mandamus. TUTRIC argues that Commerce has incorrectly
interpreted the Statement of Administrative Action accompanying the URAA (“SAA”)4 as
indicating that Section 129 implementations supersede domestic litigation on all calculation
4
Uruguay Round Agreements Act, Statement of Administrative Action, H.R. Doc. No.
103-316, vol. 1, at 1027, reprinted in 1994 U.S.C.C.A.N. 4040, 4314 (hereinafter “SAA”); 19
U.S.C. § 3512(d) (“The statement of administrative action approved by the Congress . . . shall be
regarded as an authoritative expression by the United States concerning the interpretation and
application of the Uruguay Round Agreements and this Act in any judicial proceeding in which a
question arises concerning such interpretation or application.”).
Consol. Court No. 08-00285 Page 8
aspects and that Commerce did not make it clear through the Section 129 Implementation or the
Remand Results that it was going to continue to collect cash deposits at the 6.85% rate. Pl. Br.
at 19–27. The government responds that although the numeric value of TUTRIC’s cash deposit
rate did not change in the Section 129 Implementation, the rationale underlying it did change,
making it a new rate that would apply prospectively. Gov. Br. at 15–16. The government
further argues that it has the ability to address in a Section 129 proceeding issues not raised
before the WTO. See Gov. Br. at 25–27. For the reasons set forth below, the Section 129
Implementation did not preclude the court from issuing its judgment nor does it preclude the
court from ordering compliance with that judgment.
JURISDICTION AND STANDARD OF REVIEW
The CIT has exclusive jurisdiction over civil actions commenced under Section 516A of
the Tariff Act of 1930. 28 U.S.C. § 1581(c). The court has jurisdiction over supplemental
matters such as the present matter that are “so related to claims in the action within such original
jurisdiction that they form part of the same case or controversy.” Int’l Custom Prods. v. United
States, 29 CIT 1105, 1109, 395 F. Supp. 2d 1291, 1294 (2005); United States v. Hanover Ins.
Co., 18 CIT 991, 992, 869 F. Supp. 950, 952 (1994); see also Diamond Sawblades Mfrs. Coal. v.
United States, Slip Op. 13-130, 2013 WL 5878684, at *2 (CIT Oct. 11, 2013) (exercising
jurisdiction over a challenge to the continued revocation of an antidumping order after a Section
129 determination revoked that order) (“Diamond Sawblades VI”). Because the court possesses
the same powers as a district court of the United States, 28 U.S.C. § 1585, it also has
supplemental jurisdiction as provided in 28 U.S.C. § 1367(a), except perhaps in certain limited
circumstances not present here, as well as mandamus jurisdiction as set forth in 28 U.S.C.
Consol. Court No. 08-00285 Page 9
§ 1361. Diamond Sawblades Mfrs. Coal. v. United States, 33 CIT 1422, 1429–30, 650 F. Supp.
2d 1331, 1338–39 (2009) (“[T]he court has jurisdiction to determine the effect of, and enforce its
own judgments . . . .”) (“Diamond Sawblades III”). Even when aspects of a case are appealed,
the court retains jurisdiction to enforce its judgment and to adjudicate matters unrelated to the
issues on appeal. See Williamson v. Recovery Ltd. P’ship, 731 F.3d 608, 626 (6th Cir. 2013).
Here, the issues presently before the court pertain to the enforcement of the court’s order and are
unrelated to the parties’ claims that were appealed and subsequently affirmed. Accordingly, the
court has jurisdiction to decide the current dispute. Id.
The court will grant a motion to enforce a judgment “when a prevailing plaintiff
demonstrates that a defendant has not complied with a judgment entered against it, even if the
noncompliance was due to misinterpretation of the judgment.” Heartland Hosp. v. Thompson,
328 F. Supp. 2d 8, 11 (D.D.C. 2004); see also Hanover Ins. Co., 18 CIT at 1001, 869 F. Supp. at
958 (denying a motion for contempt but directing the parties to “settle an order that will ensure
compliance with the terms of [the court’s] decision”).
DISCUSSION
I. TUTRIC Properly Challenged Its CVD Rate at the CIT
The government and Titan argue that TUTRIC has lost its right to challenge the 6.85%
cash deposit rate because it did not object to Commerce’s intended continued application of the
higher cash deposit rate either during the Section 129 proceeding or during the subsequent court
remand proceeding. The government asserts that TUTRIC had the obligation to affirmatively
raise the loan repayment issue during the Section 129 proceeding and that Commerce would
have then had the discretion to determine whether to incorporate that issue into the Section 129
Consol. Court No. 08-00285 Page 10
proceeding. Def.’s Resp. to the Ct.’s Questions 3–5, ECF No. 443 (“Gov. Resp. to Questions”).
When TUTRIC failed to do so, the government argues TUTRIC was on notice that it received a
“new” rate, even though it was the old rate, and thus had an affirmative duty to challenge that
new rate by challenging the Section 129 Implementation. See id. Of course, a challenge at that
stage would seem to be doomed to failure in the government’s view. Lastly, the government
claims to have made clear in the Remand Results its interpretation of the Section 129 proceeding
as having superseded the domestic litigation, putting the impetus on TUTRIC to challenge that
interpretation in challenging the Remand Results. Gov. Br. at 6, 16–18, 24–25. For the reasons
set forth below, the court disagrees with the government.
First, neither Section 129 nor the SAA compels Commerce’s interpretation that any
argument not raised in the Section 129 proceedings is essentially waived and any ongoing
domestic litigation concerning that argument is essentially mooted. Section 129 provides that
Commerce shall “issue a determination in connection with the particular proceeding that would
render the administering authority’s action . . . not inconsistent with the findings of the . . .
[WTO] Appellate Body.” 19 U.S.C. § 3538(b)(2). In ThyssenKrupp Acciai Speciali Terni
S.p.A. v. United States, the Federal Circuit determined that Section 129 is ambiguous and does
not explicitly require or prohibit Commerce from addressing issues not raised before the WTO.
603 F.3d 928, 934 (Fed. Cir. 2010). In that case, Commerce argued that the Section 129
proceeding was limited to the issues considered by the WTO, and the Federal Circuit determined
that such an interpretation was reasonable under the second step of Chevron, U.S.A. Inc. v.
Natural Resources Defense Council, Inc., 467 U.S. 837, 842–43 (1984). The Federal Circuit
indicated, however, that Section 129’s “limited reference to making the action not inconsistent
Consol. Court No. 08-00285 Page 11
with the findings of the Appellate Body leans toward precluding” Commerce from revisiting
issues not raised before the WTO. ThyssenKrupp, 603 F.3d at 934. Second, the SAA’s
language is replete with conditional and permissive phrasing5 indicating that Section 129
determinations are not intended to automatically occupy the entire field of litigation concerning
the subjects of the WTO challenge. Accordingly, nothing in the plain language of the SAA or
Section 129 prevents the court from definitively ruling on a completely separate and distinct
calculation issue (as well as on the validity of the CVD order) not addressed before the WTO or
in the Section 129 Implementation. Further, no policy reason prevents the court from resolving
this matter.6
5
The SAA states:
In some cases, implementation of section 129 determinations may render moot all
or some issues in pending litigation in connection with the agency’s initial
determination. For example, should the Trade Representative direct Commerce to
implement a section 129 determination that changes the cash deposit rate, such action
could render moot any pending domestic litigation solely involving the amount of
the cash deposit rate, as opposed to the validity of the underlying antidumping or
countervailing duty order. If, by contrast, the litigation also involved the validity of
the original determination, the court or binational panel would still have to render an
opinion on that subject.
SAA, H.R. Doc. No. 103-316, vol. 1 at 1027, 1994 U.S.C.C.A.N. at 4314 (emphases added).
6
Congress has specified an intent to allow parties to challenge cash deposit rates in
domestic courts. See 19 U.S.C. § 1516a(a)(2); 28 U.S.C. § 1581(c). It also specified an intent to
implement adverse WTO rulings in a limited and detailed fashion. See SAA, H.R. Doc. No.
103-316, vol. 1 at 1022–27, 1994 U.S.C.C.A.N. at 4311–14 (detailing the precise method by
which WTO rulings can be implemented and indicating that they are only implemented when the
USTR, in consultation with Congress, determines they should be implemented). Finally, here,
enforcing the 3.93% rate will not risk putting the United States out of compliance with its WTO
obligations. See Understanding on Rules and Procedures Governing the Settlement of Disputes
(continued...)
Consol. Court No. 08-00285 Page 12
Even if Commerce’s interpretation of Section 129 ultimately would be reasonable,
TUTRIC was not on notice that it could and was in fact required to bring its rate challenge based
on the loan repayment during this particular Section 129 proceeding. Commerce’s past practices
indicated that Section 129 proceedings are limited to the issues raised before the WTO. First,
there is a published Federal Circuit decision in which Commerce argued against broadening the
scope of a Section 129 proceeding to include an issue not discussed by the WTO.
ThyssenKrupp, 603 F.3d at 934.7 Commerce now asks the court to uphold as reasonable the
seemingly opposite interpretation of Section 129, namely that Section 129 proceedings are not
limited to the issues considered by the WTO and that parties must raise all of their challenges in
such proceedings. Gov. Resp. to Questions at 3–5. Second, although courts have not had many
occasions to rule on the scope of the effect of Section 129 implementations, the previous cases
6
(...continued)
arts. 21, 22.1, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization,
Annex 2, 1869 U.N.T.S. 414–15 (establishing the obligations as implementing adverse WTO
rulings within a reasonable period of time or be subject to retaliation). Under Section 129, after
consulting with Congress and Commerce, the USTR may instruct Commerce to issue a new
decision “not inconsistent with the findings of the [WTO].” 19 U.S.C. § 3538(b); U.S. Steel
Corp. v. United States, 621 F.3d 1351, 1355 (Fed. Cir. 2010). The 3.93% rate is lower than the
rate set in the Section 129 Implementation and is based on calculation issues completely separate
and apart from the issues decided before the WTO and in the Section 129 Implementation. Thus
the argument that applying the 3.93% could bring the United States out of compliance with its
WTO obligations is meritless. Further, penalizing respondents because a concerned foreign
government pursues other complaints before the WTO turns the whole process on its head.
7
ThyssenKrupp is distinguishable from the case at hand, as in that case the court
proceedings on the issue that was not before the WTO were concluded prior to the Section 129
proceeding, whereas here, the issue was ongoing at the CIT during the pendency of the Section
129 proceeding. See ThyssenKrupp, 603 F.3d at 931–32, 934. The court need not resolve
whether Commerce may broaden Section 129 proceedings to address non-WTO related issues
under facts differing from those of ThyssenKrupp.
Consol. Court No. 08-00285 Page 13
that have addressed the issue also support enforcing the court-determined 3.93% cash deposit
rate. In one of the few cases concerning a Section 129 determination, the court stated that a
Section 129 determination could not prevent the court from ruling on a distinct issue. See
Diamond Sawblades VI, 2013 WL 5878684, at *2.8
Titan cites determinations in two administrative proceedings arguing that Commerce has
at least considered broadening the scope of Section 129 proceedings on prior occasions. Def.-
Intvr’s Resp. to the Ct.’s Order of Mar. 25, 2015, 3, ECF No. 442 (“Def.-Intvr’s Resp. to
Questions”). Those proceedings, however, are both distinguishable. In Certain Cut-to-Length
Carbon-Quality Steel Plate from Italy, Commerce denied a request to apply the results of an
unrelated remand determination that was the subject of ongoing litigation at the CIT. See Issues
and Decision Memorandum for the Determination under Section 129 of the Uruguay Round
Agreements: Certain Cut-to-Length Carbon-Quality Steel Plate from Italy at 17, C-475-827 (Oct.
24, 2003), available at http://enforcement.trade.gov/download/section129/Italy-CTL-Plate-129-
Final-Decision-Memo_Signed-10-24-03.pdf (last visited May 11, 2015). In the other
determination cited by Titan, Commerce said that it could be appropriate to consider new
8
Throughout the Diamond Sawblades saga, the court repeatedly held that it had
jurisdiction and that Commerce could not act to deprive the court of the ability to grant relief to
the complaining party. See e.g., id.; Diamond Sawblades Mfrs. Coal. v. United States, Slip Op.
12-46, 2012 WL 1059369, at *2 (CIT Mar. 29, 2012) (“Diamond Sawblades V”); Diamond
Sawblades Mfrs. Coal. v. United States, Slip Op. 11-137, 2011 WL 5244699, at *4 (CIT Nov. 3,
2011) (“Diamond Sawblades IV”). The court has even described a Section 129 determination as
“interlocutory, i.e. provisional, and dependent upon the outcome of this matter.” Diamond
Sawblades VI, 2013 WL 5878684, at *2. “[N]othing in the URAA prohibits a court from
keeping an issue alive or taking action to prevent interference with its jurisdiction.” Diamond
Sawblades IV, 2011 WL 5244699, at *4. How this should be accomplished under the facts of
this case is not particularly clear.
Consol. Court No. 08-00285 Page 14
subsidy allegations raised for the first time during a Section 129 proceeding, but ultimately
refused to consider the new allegations even where those allegations arose only because of “the
WTO-dictated results.” See Issues and Decision Memorandum for the Section 129
Determination: Corrosion-Resistant Carbon Steel Flat Products from France: Final Results of
Expedited Sunset Review of Countervailing Duty Order at 16–17, C-427-810 (Oct. 23, 2003),
available at http://enforcement.trade.gov/download/section129/French-Corrosion-Sunset-129-
Final-Decision-Memo_Signed-10-24-03.pdf (last visited May 11, 2015). In neither case did
Commerce broaden the scope of the Section 129 proceeding or take the position that the
complaining party was required to bring the non-WTO related challenge during the Section 129
proceeding, the position Commerce is currently asking the court to accept. Thus the results of
those proceedings would not have put TUTRIC on notice that it had to bring the loan repayment
challenge during the Section 129 proceeding or risk losing the right to the benefits of such a
challenge received through the court proceeding.
Although “the mere fact that an agency interpretation contradicts a prior agency position
is not fatal,” Smiley v. Citibank (S.D.), N.A, 517 U.S. 735, 742 (1996), here, the sudden and
unexplained change is likely arbitrary and capricious. See id. First, it did not become obvious
that Commerce would take a divergent interpretation from that in ThyssenKrupp until sometime
after the Section 129 and Remand proceedings were completed and Commerce issued the OTR
Timken Notice.9 Accordingly, TUTRIC was not on notice of the need to challenge such an
interpretation or to bring its claim based on the loan repayment before Commerce during the
9
In reality, this position likely was not known until briefing on the current motion.
Consol. Court No. 08-00285 Page 15
Section 129 proceeding or to bring its challenge to Commerce’s interpretation of Section 129
during the Remand proceeding. Second, Commerce does not acknowledge that it is diverging
from its interpretation of the proper scope of Section 129 proceedings as set forth in
ThyssenKrupp. Thus, it does not explain why such a change would be reasonable or warranted.
See Gov. Resp. to Questions; Resp. of Pl. to the Mar. 25, 2015 Procedural Order 4–9, ECF No.
444 (“Pl.’s Resp. to Questions”). Commerce obviously has a duty to harmonize the parts of the
unfair trade statute to make it administrable, but it has to make its determination as to how to do
so in a considered way so that some consistency will result.10
Additionally, none of Commerce’s actions in the current case put TUTRIC on notice.
The USTR’s instructions in this case were similar to those in the cases in which Commerce
limited the scope of the relevant Section 129 proceedings. See ThyssenKrupp, 603 F.3d at 931;
U.S. Steel Corp. v. United States, 33 CIT 984, 1002, 637 F. Supp. 2d 1199, 1217–18 (2009)
(sustaining Commerce’s decision not to broaden the scope of a Section 129 proceeding to
address an issue not before the WTO and noting that this was supported by Commerce’s
indication that the purpose of the Section 129 proceeding was to implement the WTO report in a
similar manner to the Section 129 Implementation at issue here); Pl.’s Resp. to Questions at 6.
Thus nothing in the USTR’s instruction or in Commerce’s notice initiating the Section 129
proceeding indicated to TUTRIC that the Section 129 proceeding could and would address
issues not raised before the WTO. Accordingly, there was no indication in Commerce’s actions
10
It may be that Commerce needs to establish procedures to protect all parties and to
arrive at one final rate stemming from disparate proceedings, but it did not provide notice of
such procedures in this case.
Consol. Court No. 08-00285 Page 16
in this case or in its past practices that would have made it clear to TUTRIC what it needed to do
to preserve its rate challenge based on the loan repayment.
TUTRIC also observes that although Commerce may have referred to rates in the Section
129 Implementation as “new” and “revised,” that language did not apply to TUTRIC’s
unchanged rate, particularly because another respondent’s rate did change,11 as did the “All
Others” rate. Pl. Br. at 23–24. Accordingly, such references throughout the Section 129
Implementation are properly viewed as referring to those changed rates as opposed to TUTRIC’s
unchanged rate. TUTRIC is correct that its CVD rate was not “new,” “amended,” or “revised.”
Thus as a practical matter, TUTRIC could not have objected to the statements in the Section 129
Implementation or Remand Results until the publication of the OTR Timken Notice, because up
until that point, Commerce had not made clear its intent to continue to utilize the 6.85% rate as
the deposit rate, no matter the result of this litigation. If it had, presumably TUTRIC would have
objected, and if Commerce did not agree at either stage, the court would have ordered the same
relief given here.
Finally, given that the loan repayment had no bearing on the other issues addressed
during the Section 129 proceeding, even if TUTRIC had raised it as a challenge during the
Section 129 proceeding, there is nothing indicating that Commerce, assuming arguendo that it
could, would have accepted that invitation to broaden the scope of the Section 129 proceeding to
include the remedy TUTRIC has already obtained. In fact, Commerce’s past practice suggests
that it would not have broadened the scope. How TUTRIC then would preserve its rights is not a
11
That respondent was Guizhou Tyre Co., Ltd.
Consol. Court No. 08-00285 Page 17
question that Commerce has definitively answered in this case. Whether TUTRIC was required
to ask that the Section 129 proceeding be kept open pending the court case or take some other
action not specified in the statute or regulations is not explained. Accordingly, even if TUTRIC
had followed the government’s suggestion here that it raise the issue in the Section 129
proceeding, TUTRIC likely would have ended up asking the CIT for the exact same relief it is
currently seeking.
II. Neither Titan Nor the Government Will Be Prejudiced by the Enforcement of the
Court’s Judgment
Further supporting the court’s decision to require Commerce to issue a revised Timken
Notice setting TUTRIC’s CVD cash deposit rate at 3.93% based on the unique facts of this case
is that neither Titan nor the government will be prejudiced by the enforcement of the judgment.
Although Titan supports the government’s interpretation of the Section 129 Implementation, it
will not be prejudiced if the court enforces its judgment. TUTRIC is not getting any more of a
benefit than the court has already determined it is entitled to. Even if TUTRIC had divined at
some point in the Section 129 proceeding that it needed to raise the loan repayment issue with
respect to that proceeding, it either would have been granted the 3.93% rate or a similar rate by
Commerce based on its determination that the loan was partially repaid, or the parties would
have ended up before the CIT upon TUTRIC’s challenging Commerce’s faulty determination in
the Section 129 proceeding (assuming Commerce adopted the 6.85% rate). In the end, the result
would have granted TUTRIC the same benefit of the 3.93% CVD cash deposit rate.12
12
Enforcing the 3.93% CVD rate will not inequitably impact the AD rate. Def.-Intvr’s
Resp. to Questions at 7–9. In the Section 129 proceeding, Commerce decided to adjust the AD
cash deposit rates through the double remedy adjustment only for input subsidies. Id. As
(continued...)
Consol. Court No. 08-00285 Page 18
III. TUTRIC Has No Adequate Alternative Remedies
The government and Titan also suggest that one way for TUTRIC to receive the benefit
of the court’s order sustaining the 3.93% CVD rate would be for TUTRIC to ask for an
administrative review. TUTRIC, however, does not have to pursue every potential avenue of
relief, particularly one which would simply expend agency, court, and the parties’ time for no
purpose. That is, the parties are precluded from re-litigating the loan repayment issue, as it has
already been fully litigated, and the factual and legal determinations have been made. The only
differing result TUTRIC could expect from an administrative review would be a rate stemming
from something like a methodological change in calculating the discount rate. See New
Pneumatic Off-the-Road Tires From the People’s Republic of China: Preliminary Results of
Countervailing Duty Administrative Review, 75 Fed. Reg. 64,268, 64,272 (Dep’t Commerce
Oct. 19, 2010) (adopted without changes by New Pneumatic Off-the-Road Tires From the
People’s Republic of China: Final Results of Countervailing Duty Administrative Review, 76
Fed. Reg. 23,286 (Dep’t Commerce Apr. 26, 2011)). Obviously, no party was interested in
pursuing this type of issue as reviews were not sought. Although both Titan and the government
admit that asking for an administrative review at this point would still subject certain entries to
the higher 6.85% rate, they claim that this is TUTRIC’s fault for not requesting an administrative
review sooner. See Gov. Resp. to Questions at 4–5 (administrative review would not cover
entries from August 21, 2012, through December 31, 2013). As indicated, here TUTRIC was
not on notice that this was the remedy is must pursue. Further, although the government
12
(...continued)
TUTRIC’s loan repayment did not impact its input subsidies, the change to the CVD cash
deposit rate thus will not impact TUTRIC’s AD rate.
Consol. Court No. 08-00285 Page 19
suggests an administrative review as an adequate alternative remedy, it argues that because each
administrative review is a separate matter from an investigation, Commerce would not be bound
by the court’s determination of the loan repayment issue; the government does not provide
support for this point. See Gov. Resp. to Questions at 6–7. Titan, on the other hand, concedes
that absent new facts Commerce would be bound by the court’s determination of the loan
repayment issue. Def.-Intvr’s Resp. to Questions at 7. Titan is correct, and given the fact that
the loan repayment issue deals with a non-recurring subsidy, the facts surrounding the loan and
its subsequent repayment would not change from year to year. There is no continuing issue
regarding repayment of the loan that could be addressed again, making an administrative review
both an inadequate and an unnecessary alternative remedy under the facts at hand.
IV. The Court Has the Power to Interpret Its Own Rulings
Although the government claims that in sustaining the Remand Results the court
sustained the use of the 6.85% cash deposit rate, the court is the final authority on interpreting its
own rulings. See Energy Recovery, Inc. v. Hauge, 745 F.3d 1353, 1356 (Fed. Cir. 2014)
(applying Fourth Circuit law); SEC v. Hermil, Inc., 838 F.2d 1151, 1153 (11th Cir. 1988); D&M
Watch Corp. v. United States, 16 CIT 285, 296, 795 F. Supp. 1160, 1169 (1992) (ordering
reliquidation of entries to comply with court’s previous judgment). The court’s ruling sustained
Commerce’s Remand Results, which did three things: first, it set TUTRIC’s specific CVD rate at
3.93%; second, it confirmed that Starbright’s cash deposit rate would continue to be based on the
rate set in the intervening administrative review; and finally, it confirmed that the rate for “all
other respondents” would continue to be based on the Section 129 Implementation. Remand
Results at 50–51. Because cash deposits are based on the specific CVD rate assigned, the
Consol. Court No. 08-00285 Page 20
Remand Results implicitly set TUTRIC’s CVD cash deposit rate at 3.93%. Id. at 50.
As noted, after specifically determining TUTRIC’s rate, Commerce stated in the Remand
Results, “[a]s a consequence of these intervening determinations, should the Court sustain this
remand redetermination, the cash deposit rates in effect for subsequent entries will continue to be
based on the intervening administrative review for Starbright and the intervening 129
Implementation Notice for all other respondents.” Remand Results at 51. The government
argues that this clearly indicated Commerce’s intention to collect cash deposits from TUTRIC at
the 6.85% set in the Section 129 Implementation. Gov. Br. at 16–18. The government and Titan
argue that because the Section 129 Implementation used the words “new determination,”
“revised” margins, and “appropriate rate[s] . . . specified above” there was no ambiguity such
that the Remand Results clearly indicated that Commerce would continue to apply the 6.85%
rate to TUTRIC. As described above, there was no such clarity.
The Remand Results did not specifically state what TUTRIC’s cash deposit rate would
be. Commerce was cryptic at best in the Remand Results by using the term “all other
respondents” when “All Others” were a specific group given a separate rate in the Section 129
Implementation. By using nearly identical terms to mean different things in the two related
documents after specifically treating TUTRIC separately in the Remand Results, Commerce did
not indicate to the court that it intended to deviate from the normal practice of setting the cash
deposit rate at the CVD rate set in a remand determination. Further, the Section 129
Implementation was, at best, ambiguous, because it stated that Commerce would apply
“appropriate” cash deposit rates, but did not indicate that meant it would apply the “amended” or
“revised” rates stated therein; it could just as easily have meant the rate that the court determined
Consol. Court No. 08-00285 Page 21
to be supported by substantial evidence. Accordingly, in sustaining the Remand Results, the
court sustained the normal result, which is to apply the CVD rate set in the Remand Results
because it is the most current and accurate estimate of the duties to be paid. See 19 U.S.C.
§ 1671d(c)(1)(B)(ii); Allegheny Ludlum Corp. v. United States, 346 F.3d 1368, 1373 (Fed. Cir.
2003); Decca Hospitality Furnishings, LLC v. United States, 30 CIT 357, 372, 427 F. Supp. 2d
1249, 1263 (2006). Commerce’s actions, which hid the ball and later applied the higher rate the
court had held to be unsupported by substantial evidence, were inappropriate, even if
inadvertently so. In context, the “all other respondents” language from the Remand Results
meant any party other than Starbright or TUTRIC. The court’s order sustaining the Remand
Results thus adopted the 3.93% rate as the rate to be applied to all of TUTRIC’s suspended and
unliquidated entries and as TUTRIC’s prospective cash deposit rate.
Given the language chosen by Commerce in the Section 129 Implementation and the
Remand Results and given the lack of harm to Titan in this case, Commerce is charged with any
error. This is the efficient and fair result. Whether Commerce makes clear parties’ obligations
in parallel WTO and court proceedings in a way that complies with the statute, but in a manner
different from this case, is left for another day. Contrary to Titan’s contention, the judgment
does not need to be amended to grant the relief TUTRIC seeks. Because Commerce has not
complied with the court’s judgment, TUTRIC’s motion to enforce the judgment will be granted.
See Heartland Hosp., 328 F. Supp. 2d at 11–12.
CONCLUSION
For the foregoing reasons, TUTRIC’s motion to enforce the judgment is granted.
Commerce shall issue a revised Timken Notice setting the cash deposit rate for TUTRIC at
Consol. Court No. 08-00285 Page 22
3.93%. As the court has continued its original injunction of liquidation, see Order, ECF No. 448
(May 5, 2015), when liquidation instructions are issued, they shall reflect the court’s original
direction to liquidate only in accordance with the final and conclusive judgment in this matter.
Thus, the court need not order anew that refunds be made.
/s/ Jane A. Restani
Jane A. Restani
Judge
Dated: May 18, 2015
New York, New York