Aluminum Extrusions Fair Trade Committee v. United States , 968 F. Supp. 2d 1244 ( 2014 )

Slip Op. 14- 6
UNITED STATES COURT OF INTERNATIONAL TRADE
ALUMINUM EXTRUSIONS FAIR TRADE
COMMITTEE,
Plaintiff,
Before: Donald C. Pogue,
v. Chief Judge
UNITED STATES, Consol. Court No. 11-002161
Defendant.
[Plaintiff’s motion for judgment on the agency record denied;
Department of Commerce’s determinations affirmed]
Dated: January 23, 2014
Alan H. Price, Robert E. DeFrancesco, Lori E. Scheetz,
Tessa Capeloto, Laura El-Sabaawi, and Derick G. Holt, Wiley
Rein, LLP, of Washington, DC for the Aluminum Extrusions Fair
Trade Committee.
Tara K. Hogan, Trial Attorney, Commercial Litigation
Branch, Civil Division, U.S. Department of Justice, of
Washington, DC, for Defendant. Of counsel on the brief was
Rebecca Cantu, Attorney, Office of the Chief Counsel for Import
Administration, U.S. Department of Commerce, Washington, DC.
Duane W. Layton, Jeffery C. Lowe, and Sydney Mintzer, Mayer
Brown, LLP, of Washington, DC for Aavid Thermalloy.
1
This action was consolidated with Court No. 11-00218.
Consol. Court No. 11-00216 Page 2
OPINION
Pogue, Chief Judge: In this action, the Aluminum
Extrusions Fair Trade Committee (“AEFTC”) challenges two aspects
of the Department of Commerce’s (“Commerce” or the “Department”)
definition of the products excluded from Anti-Dumping (“AD”) and
Countervailing Duty (“CVD”) orders on aluminum extrusions from
the People's Republic of China ("China").2 Plaintiff first
argues that the definition of finished heat sinks (“FHS”)
excluded from the orders does not accurately reflect the
definition provided by the International Trade Commission (“ITC”
or the "Commission") in its finding of no material injury.
Second, Plaintiff challenges the Department’s failure to specify
in the instructions issued to Customs and Border Protection
(“CBP”) that importers must certify that their products meet
certain testing requirements allegedly required by the ITC’s
definition of FHS.
The court has jurisdiction over Plaintiff’s claims under 28
U.S.C. 1581(c).3
2
These orders were issued by the Department acting under Section
702 of the Tariff Act of 1930, as amended, 19 U.S.C. §
1671(a)(2006). All further citations to the Tariff Act of 1930,
as amended, are to Title 19 of the U.S. Code, 2006 edition.
3
Jurisdiction was addressed in detail in response to Defendant
and Defendant-Intervenor’s Motions under USCIT R. 12(b)(1) and
(footnote continued . . .)
Consol. Court No. 11-00216 Page 3
Currently before the Court is Plaintiff’s motion for
judgment on the agency record. ECF No. 49.4 The motion is
denied. The Plaintiff has not demonstrated that the scope of
the exclusion in the Department’s AD and CVD orders is
materially different from the exclusion identified by the ITC.
Further, Plaintiff’s claim that the corresponding instructions
issued by the Department to CBP are flawed in failing to require
testing, certification, or proof of buyer in order to establish
their eligibility for the FHS exclusion, must be rejected as
unripe for decision. Until CBP, acting upon the Department’s
instructions, misidentifies products eligible for the ITC’s FHS
exclusion, the Plaintiff’s claim remains speculative and their
injury hypothetical.
12(b)(5). See Aluminum Extrusions Fair Trade Committee v.
United States, __ CIT __, Slip Op 13-26 (Feb. 27, 2013) (ECF No.
45).
4
In its motion, Plaintiff asks that the Court void the
Department’s AD and CVD orders for their alleged failure to
properly reflect the scope of the ITC’s negative injury and like
product findings. Id. at 7. In addition, Plaintiff argues that
the Department’s instructions to CBP must be revised to require
that products allegedly falling within the scope of the ITC’s
negative injury finding, and therefore not requiring cash
deposits, be certified as having undergone thermal testing. Id.
at 15.
Consol. Court No. 11-00216 Page 4
BACKGROUND
In response to the Plaintiff’s petitions, Commerce
initiated an investigation of aluminum extrusions imported from
China in April of 2010.5 Pl. Mot. for Judgment on the Agency
Record, May 15, 2014, ECF No. 49 ("Pl.'s Mot.") at 4. The final
determinations in this investigation concluded that Chinese
aluminum extrusions were being sold at less than fair value and
that countervailable subsidies were being provided by the
Chinese government, thus warranting the imposition of AD and CV
duties on the subject imports. Aluminum Extrusions From the
People’s Republic of China, 76 Fed. Reg. 18,521 (Dep’t Commerce
Apr. 4, 2011) (final affirmative countervailing duty
determination); Aluminum Extrusions From the People’s Republic
of China, 76 Fed. Reg. 18,524 (Dep’t Commerce Apr. 4, 2011)
(final determination of sales less than fair value). The scope
of the Department’s determination included finished and
unfinished aluminum shapes produced by extrusion and identified
by their metallurgical content and role in a production process,
with clarifying statements and examples about product types
5
Plaintiff has represented the domestic manufacturers of
aluminum extrusions in both the administrative investigation of
Chinese imports and in this action.
Consol. Court No. 11-00216 Page 5
excluded from the investigation.6 Aluminum Extrusions, 76 Fed.
Reg. at 18,521-22.
Concurrent with the Department’s investigation, and in
accordance with 19 U.S.C. 1671(b) and 19 U.S.C. 1673b(a), the
ITC conducted its own investigation to determine whether
domestic industries were materially injured or threatened with
material injury by the importation of dumped or subsidized
aluminum extrusions. While the ITC’s preliminary affirmative
finding of injury matched the product scope definition used by
the Department and reflected the original petition, Certain
Aluminum Extrusions From China, 75 Fed. Reg. 34,482 (ITC June
17, 2010) (preliminary determination), this scope finding was
revised in the Commission's final determination to exclude FHS
6
Aluminum extrusions as a broad category (as they were defined
in the Commerce investigation and in the ITC’s preliminary
report) are industrial and consumer objects identifiable by
their chemical content and manufacturing process. First,
aluminum extrusions consist chemically of one of 160 specified
aluminum alloy types that are all “soft alloys” identified by
Aluminum Association designations in the 1000, 3000, and 6000
range that mix pure aluminum with magnesium or silicon. Second,
these products have been shaped by an extrusion process –
heating a billet of the alloy and pushing it through a precision
die that produces a raw shape usually called a “blank” that is
then further machined, finished, or coated as required for its
future manufacturing or consumer use. See 76 Fed. Reg. 18521,
18524, and 18525 (anti-dumping and countervailing duty Final
Determinations) and Certain Aluminum Extrusions from China,
Investigation Nos. 701-TA-475 and 731-TA-1177 (Final) at 5-10.
The exclusion of FHS from this broader category based on their
precision machining and customized thermal characteristics is
the context of the present dispute.
Consol. Court No. 11-00216 Page 6
as a separate domestic like product and industry not threatened
with material injury. Certain Aluminum Extrusions From China, 76
Fed. Reg. 29,007 (ITC May 19, 2011) (final determination). This
exclusion was based on a set of criteria regularly used by the
ITC and hinged specifically on
the customized thermal resistance properties of FHS;
the unique aspects of the design, testing and
production of FHS; differences between FHS and other
aluminum extrusions in the channels of trade through
which they are sold; evidence that the thermal
management industry is perceived by producers and
customers as being different from the general aluminum
extrusions industry; and the fact that FHS are sold at
much higher prices because of high value-added than
most other aluminum extrusions.7
Certain Aluminum Extrusions from China, USITC Pub.4229, Inv.
Nos. 701-TA-475 and 731-TA-1177 (Final), at 9 (May 2011) (“ITC
Report”).
In defining the excluded industry and domestic like
product, the ITC report described FHS, in the introductory
Determinations section, as "fabricated heat sinks, sold to
electronics manufacturers, the design and production of which
are organized around meeting certain specified thermal
7
This exclusion in the final determination is explained in more
detail with specific reference to the ITC’s six factor test in
Certain Aluminum Extrusions from China, Inv. Nos. 701-TA-475 and
731-TA-1177 (Final), USITC Pub. 4229 (May 2011) (“ITC Report”).
The ITC’s negative injury determination was challenged before
the U.S.C.I.T. and upheld in Aluminum Extrusions Fair Trade
Comm. V. United States, 34 Int'l Trade Rep. (BNA) 2119.
Consol. Court No. 11-00216 Page 7
performance requirements and which have been fully, albeit not
necessarily individually, tested to comply with such
requirements." Id. at 1 n. 4; Id. at 3 n. 1. In response to the
exclusion specified in the ITC's final report, the Department
revised its own final determination to exclude FHS and issued AD
and CVD orders excluding FHS from the scope of the cash deposit
requirements on aluminum extrusions. Pl.'s Mot. at 5; Draft
Customs Instructions, AD. PR. Doc. No. 540.
In identifying the excluded products in the AD and CVD
orders, the Department modified the exact language used by the
ITC in its footnote 4. Specifically, the Department eliminated
the four words "sold to electronics manufacturers" from the
ITC's product description. Pl.'s Mot. at 5. This clause,
identifying the buyers of FHS, is alleged by the Plaintiff to
represent a critical limitation on the scope of the ITC's
exclusion from the injury determination.8 Id. at 5-6. To the
8
Plaintiff argues that by eliminating this clause and failing to
specify a testing requirement reflective of the clause (retained
in the AD and CVD orders) describing thermal testing as part of
the definition of FHS, the Department has expanded the
definition of FHS to include the broader category of fabricated
heat sinks, which may not have been fully tested to insure that
they comply with specific thermal requirements. Reply Brief of
the Aluminum Extrusions Fair Trade Committee, Sept. 9, 2013, EFC
No. 59 (“Pl.'s Reply Br.”) at 4. To the Plaintiff, FHS are
understood as a subcategory of fabricated heat sinks
distinguishable from the parent category by thermal testing and
identity of the purchaser. Pl.'s Mot. at 11.
Consol. Court No. 11-00216 Page 8
Plaintiff, the elimination of these four words expands the scope
of the ITC's excluded category and therefore represents both an
unlawful violation of the Department's authority relative to the
ITC and an inappropriate limit on the remedy to which the law
entitles a domestic industry injured by subsidized imports.
Compl., ECF No. 7, at 6; Pl.'s Reply Br. at 5.
STANDARD OF REVIEW
The Department's determination will be affirmed unless it
is “unsupported by substantial evidence on the record, or
otherwise not in accordance with law.” 19 U.S.C. §
1516a(b)(1)(B)(i). Substantial evidence means “such relevant
evidence as a reasonable mind might accept as adequate to
support a conclusion.” Universal Camera Corp. v. N.L.R.B., 340
U.S. 474, 477 (1951) (quoting Consol. Edison Co. v. N.L.R.B.,
305 U.S. 197, 229 (1938)). Accordingly, when reviewing agency
determinations, findings, or conclusions for substantial
evidence, the court assesses whether the agency action is
reasonable given the record as a whole. Nippon Steel
Corp. v. United States, 458 F.3d 1345, 1350-51 (Fed. Cir. 2006).
In doing so, the court must consider any fact that “fairly
detracts from [the agency conclusion’s] weight.” Universal
Camera Corp., 340 U.S. at 488. As importantly, a reviewing
Consol. Court No. 11-00216 Page 9
court may not "displace the [agency’s] choice between two fairly
conflicting views, even though the court would justifiably have
made a different choice had the matter been before it de novo.”
Id.DISCUSSION
I. The Department's Exclusion of "sold to electronics
manufacturers" in the AD and CVD Orders
Plaintiff has not provided sufficient evidence to support
the claim that the Department's implementation of the ITC's
separate domestic like product and negative injury finding
expands the ITC’s definition. As explained below, the evidence
on the record can reasonably be read to support the Department’s
view that that the elimination of the clause "sold to
electronics manufacturers" from the description of FHS in the AD
and CVD orders will not result in any material difference in how
CBP classifies imported aluminum extrusions and implements the
cash deposit order. Absent evidence that the Department's
altered wording will prevent the ITC's negative injury finding
from being correctly implemented, we defer to the Department's
judgment in implementing its AD and CVD orders.
Consol. Court No. 11-00216 Page 10
AEFTC argues that the Department's decision to alter the
wording of the ITC's definition of FHS represents an unlawful
expansion of the Department's authority relative to the ITC,
improperly substituting its judgment for that of the Commission.
Pl.'s Mot. at 12.9 Specifically, Plaintiff alleges that the
identity of the purchaser is a critical part of the definition
of FHS as found by the ITC; eliminating this clause from the
definition therefore necessarily broadens the category of the
exclusion and violates the intent of the ITC. Id. at 11. If
this is correct, then the Department has overstepped its
statutory authority, because the statute does not give Commerce
the discretion to materially modify the findings of the ITC and
requires that it impose anti-dumping or countervailing duties on
merchandise that has been found to be both unfairly subsidized
by Commerce and harmful or prospectively harmful to a domestic
industry by the ITC. 19 U.S.C. §§ 1671(a) and 1673.
But the legal validity of Plaintiff’s claim is critically
dependent upon the factual question of whether the Department's
9
The distinct and mutually dependent roles played by the
Commission and the Department in implementing AD and CVD duties
arise from 19 U.S.C. § 1671a (describing the process for
countervailing duties) and 19 U.S.C. §1673(2) (describing the
parallel process for antidumping duties). The interlocking
functions of the Commission and the Department in practice are
described in Mitsubishi Electric Corp. v. United States, 898
Fed. 2d. 1577, 1579 (Fed. Cir. 1990).
Consol. Court No. 11-00216 Page 11
omission of the words "sold to electronics manufacturers"
actually has "effectively removed a subset of heat sinks, which
the Commission found to be materially injuring the domestic
industry . . . from the scope of the AD/CVD order." Pl.'s Mot.
at 11. It is in establishing this factual claim that
Plaintiff's argument fails.
AEFTC bases its argument on the assertion that the ITC's
definition of FHS consists only of the brief description given
in footnote 4 of the Final Injury Determination and that every
element of the text of this footnote must be faithfully and
exactly repeated by the Department.10 By omitting the clause
describing purchasers, the Department is alleged to have
produced AD and CVD orders so vague as to "effectively expand
the Commission's definition of 'finished heat sink,' thereby
unlawfully denying relief to a segment of the U.S. industry that
the Commission found to be materially injured." Id. at 12-13.
Two aspects of the record indicate that the exclusion of
these four words does not alter the definition of FHS. First,
the submissions made by the parties do not indicate that any
products will be improperly excluded from the AD and CVD orders
as a result of the omitted language. Second, the ITC report
10
For the exact text of this footnote, which appears both in
Sections entitled "Determinations" and "Views of the
Commission," see above pp. 6-7.
Consol. Court No. 11-00216 Page 12
itself, examined in detail, does not support the proposition
that the four words omitted by the Department actually are
critical to the product and industry definitions developed by
the Commission.
Beyond the assertion cited above that Commerce has
improperly expanded the scope of the ITC's exclusion, Plaintiff
does not identify anywhere in the record the products that would
be improperly admitted without appropriate AD or CVD duties if
the purchaser is not specified in the AD and CVD orders. If
there exists a category of FHS possessing all of the physical
properties described by the ITC and reflected in the
Department's AD and CVD instructions that is not sold to
electronics manufacturers or to suppliers of such manufacturers,
such products are not identified in the Plaintiff's submissions.
This failure is critical, since it leaves no reason to believe,
based on the record evidence, that the identity of the purchaser
is material to the definition.
Rather, replying to the Defendant's denial that the
exclusion has been enlarged by the altered wording, the AEFTC
merely repeats the claim that "Commerce improperly expanded the
Commission's definition of 'finished heat sinks,' thereby
inappropriately excluding merchandise . . . and inappropriately
limiting the remedy to the materially injured domestic
Consol. Court No. 11-00216 Page 13
industry." Pl.'s Reply Br. at 5. The only allegation of how the
product category might actually be expanded in the reply brief
refers to fabricated heat sinks and heat sink blanks that might
be improperly classified as FHS and therefore excluded from the
AD and CVD orders based on the omitted language.11 Id. at 7.
Implicitly, Plaintiff suggests that these two categories of
aluminum extrusions might be distinguishable from FHS only by
the identity of their purchasers and therefore would be
improperly classified if the final purchaser is not identified
in the AD and CVD orders.
Confronting Plaintiff’s suggestion, the Department’s
response is only mildly persuasive. The Department claims that
the omission of the words "sold to electronics manufacturers"
represents a clarification of the ITC's definition that does not
materially alter the scope of the exclusion. Response in
Opposition to Motion for Judgment on the Agency Record, Aug. 30,
2013, ECF No. 58 (“Def. Resp.”) at 14. The Department also
argues that this clarification is reasonable and consistent with
11
Fabricated heat sinks are a broader category of aluminum
extrusions that are designed around thermal properties but lack
the precise surface tolerances and customized thermal resistance
properties of FHS. See ITC Report at 7. Heat sink blanks are a
precursor product to fabricated or finished heat sinks that
require additional machining, forming, and testing. Id. at 31(Dissenting Views of Vice Chairman Irving A. Williamson and
Comm’r Charlotte R. Lane).
Consol. Court No. 11-00216 Page 14
the established practice because CBP, in implementing AD and CVD
orders, is often unable to identify the domestic purchaser.
This has caused the Department to develop a general policy of
not making product identification dependent on end use or the
identity of purchasers.12 Id. at 13 (citing Circular Welded
Carbon Quality Steel Pipe from the People's Republic of China,
73 Fed. Reg. 31,970 (Dep't of Commerce June 5, 2008) (final
determination) and accompanying I&D Memo at cmt. 1). Commerce
argues further that including the omitted language might "reduce
the effectiveness of the exclusion by creating ambiguity" by
12
While the Department's general policy is clear, Defendant's
reliance on King Supply Co. LLC v. United States, 674 F. 3d 1343(Fed. Cir. 2012), to support the argument that "sold to
electronics manufacturers" should be understood as exemplary
rather than limiting language due to the absence of express
terms such as "only" or "solely" is misplaced. At issue in King
Supply was the Department's interpretation of the language of
its own AD orders rather than a potential conflict between the
ITC's product or industry definitions and those of the
Department. It would be unwarranted to take the ruling in King
Supply as suggesting that the Department may interpret the scope
language in an ITC determination as exemplary absent specific
limiting terms. Similarly, the citation of Polites v. United
States, __ CIT __, 780 F. Supp. 2d 1351, 1356 (2011), by the
Defendant-Intervenor to support the claim that the Department
has broad authority over the language of AD and CVD orders is
not relevant, since the present case does not deal with the
Department’s latitude to formulate the text of such orders, but
rather their obligation to faithfully implement the findings of
the ITC, as Plaintiff correctly points out. Pl.'s Mot. at 11;
Response of Aavid Thermalloy, LLC in Opposition to Mot. for
Judgment on the Admin. Record, Aug. 30, 2013, ECF No. 57 (Def.-
Intervenor’s Resp.”) at 6.
Consol. Court No. 11-00216 Page 15
directing CBP to consider factors that it is unable to properly
evaluate. Id. at 14.
Nevertheless, the Department’s claim is supported by a
detailed examination of the way in which the ITC Report defines
FHS and the actual significance of the purchaser in this
definition. The Commission's finding that there exists a
category of aluminum extrusions that it calls finished heat
sinks and that no domestic industry is threatened by the import
of this product is based on a six-part like product analysis.13
These six factors include the physical characteristics and uses
of the product, its interchangeability with related products,
the channels of distribution through which the product moves,14
13
The ITC's product and industry definitions require the
Commission to weigh a range of factors based on technically
complex and often ambiguous data. The Commission makes a
factual determination in defining domestic like products and
establishing the boundaries of domestic industries for the
purposes of its injury determinations. In this determination,
the Commission uses different tests and does not rely on any
single factor or product characteristic to define a product
type. ITC Report at 3-4. In this case, the ITC employed a six
factor test that the report describes as a "traditional" ITC
approach to like product definition. See id. at 7, n. 16. For a
review of the six factor test and a discussion of like product
analysis, see Cleo Inc. v United States, 501 F. 3d 1291, 1295
(Fed. Cir. 2007).
14
This factor includes the identity of the purchaser or end
user; in the instant investigation, the Commission observes that
FHS are sold to specialized distributors as well as
manufacturers of electronic products. ITC Report at 8.
Consol. Court No. 11-00216 Page 16
common manufacturing facilities, processes, or employees, and
customer or consumer perceptions of the product. See ITC Report
at 7-9.15
Examining the ITC Report as a whole, four facts emerge that
support the Department's characterization of "sold to
electronics manufacturers" as "descriptive language that does
not limit the exclusion in any way." Def. Resp. at 14. First,
FHS are repeatedly identified in the ITC Report by two physical
properties – (1) their precise design and finish characteristics
and (2) their thermal resistance properties that are intended to
meet the specific needs of a given piece of electronic
equipment. See, e.g., ITC Report at 7. This suggests that the
ITC itself relies primarily on physical properties to define
FHS, making it reasonable for the Department to interpret the
omitted "sold to electronics manufacturers" as redundantly
descriptive rather than limiting language.
15
In this case, both the ITC's decision to define FHS as a
separate product and the methodology by which the Commission
distinguished FHS from all other aluminum extrusions were
contested by dissenting members of the Commission. See Id. at
31-35 (Dissenting Views of Vice Chairman Irving A. Williamson
and Comm’r Charlotte R. Lane). The methodology used in the like
product analysis was itself challenged in Aluminum Extrusions
Fair Trade Comm. v. United States, Slip Op. 2012-129, 2012 Ct.
Intl. Trade Lexis 134, (CIT Oct. 11, 2012). While this fact
makes the Commission's findings no less binding or necessarily
more ambiguous, it does highlight the complexity of ITC findings
and the difficulty of reducing them to a simple incantation.
Consol. Court No. 11-00216 Page 17
Second, FHS are sold to both manufacturers and
distributors. Id. at 8. This fact also suggests that the words
omitted by Commerce are intended to clarify the function and
specific design parameters of FHS and not to impose a
restriction based on the purchaser. Since the ITC acknowledges
that manufacturers and distributors purchase FHS, the purpose of
specifying "sold to electronics manufacturers" is more likely to
be clarification of the actual end use of FHS - cooling
electronic equipment - than establishing an exclusion based on
the identity of the purchaser that would also create an
inconsistency within the ITC Report.
Third, FHS are "precisely or optimally suited to cool the
specific electronic devices for which they have been designed."
Id. at 7. This design specificity supports the point made by
the Defendant-Intervenors that FHS, as identified by their
physical characteristics, have no significant use or plausible
purchaser outside of electronics manufacture.16 Def.-Intervenor's
16
The design specificity of FHS and the fact that electronics
manufacture makes up the only end use for FHS is also supported
by the demand analysis conducted by the ITC. See ITC Report at
25. The Commission also notes that the value added from
specifically designed thermal resistance accounts for a large
gap in prices between FHS and all other aluminum extrusions. Id.
at 9. The reasons for this difference in price, which affects
both the "price" and "customer and producer perceptions" prongs
of the Commission's six factor test, further supports the
characterization of FHS by the Defendant as a product that can
(footnote continued . . .)
Consol. Court No. 11-00216 Page 18
Resp. at 5. The Department's omission of the purchaser from the
AD and CVD order will therefore not materially change the scope
of the orders because the set of FHS sold to end users aside
from electronics manufacturers is empty.17 This further
undermines the Plaintiff's claim that the Department's
alteration of the Commission's language will prevent the intent
of the ITC's findings from being carried out, unlawfully expand
the scope of the exclusion defined by the ITC, or allow any
aluminum extrusions to improperly enter the country under the
FHS exclusion.
Considered as a whole, the ITC's findings are more nuanced
than the summary language that appears in, e.g., the ITC Report
at 1 n. 4.18 The report as a whole provides a sufficiently
specific definition of the product itself, regardless of the
purchaser’s identity. Accordingly, based on the record here,
the Department's omission of "sold to electronics manufacturers"
from the text of the AD and CVD orders is a reasonable way to
be correctly and faithfully identified without reference to the
specific purchaser.
17
For clarity, note the distinction here between the immediate
purchaser, a group that might include distributors or other
market intermediaries as well as manufacturers, and end users,
which from the record evidence will consist only of electronics
manufacturers.
18
See above pp. 6-7 for the pertinent language.
Consol. Court No. 11-00216 Page 19
implement the scope of the FHS exclusion such that it is both
faithful to the ITC's scope definition and possible for CBP to
implement.
II. The Department's Failure to Include a Testing Requirement
in their Instructions to CBP
Plaintiff also challenges the Department’s failure to
require, in the instructions issued to CBP, certification of
thermal testing for FHS excluded from the orders. The language
of both the ITC's FHS exclusion and the Department's own AD and
CVD orders specifies that FHS are designed around specific
thermal properties and that they have been "fully, albeit not
individually, tested to comply with such requirements." ITC
Report at 1 n. 4 and 3 n. 1. Plaintiff argues that the failure
to specify a testing or certification of testing requirement
will necessarily have the effect of unlawfully allowing untested
- and therefore unfinished under the ITC's definition - heat
sinks to enter the United States under the FHS exclusion. Pl.'s
Mot. at 15. Specifically, Plaintiff asserts that since it is
impossible for CBP to identify the precise thermal
characteristics or tested status of heat sinks by physical
examination of the item itself, instructions that do not specify
a testing or certification requirement are inherently
Consol. Court No. 11-00216 Page 20
unreasonable, necessarily fail to properly reflect the narrow
scope of the ITC's FHS exclusion, and must therefore be found
unlawful and remanded to the Department for reconsideration. Id.
at 15, 16.19
While this argument raises reasonable concerns about the
implementation of the Department's AD and CVD orders, it must be
dismissed as unripe for adjudication. The ripeness prerequisite
springs from the Constitution's requirement that the judiciary
address only an actual case or controversy and avoid extending
its role to advisory or hypothetical judgments. See Nat'l Park
Hospitality Ass'n v. Dep't of Interior, 538 U.S. 803, 807-08
(2003). Within the realm of administrative law, ripeness is
intended to "prevent the courts, through the avoidance of
premature adjudication, from entangling themselves in abstract
disagreements over administrative policies, and also to protect
the agencies from judicial interference until an administrative
Plaintiff draws a plausible parallel between the kind of
19
certification it contends that the Department should require for
FHS and the Commission’s prior imposition of a requirement that
importers produce a statement of the carbon and metallic
elements composition of certain iron or steel products. Pl.'s
Mot. at 15-16, citing 19 C.F.R. § 141.89 (entry on iron or steel
classifiable in Chapter 72 or headings 7301 to 7307, HTSUS
(T.D.53092,55977)). Plaintiff suggests that the requirement
that such a statement be in the form of a mill test certificate
demonstrates both that the Department is willing to impose
testing or certification requirements on certain products when
necessary and that such a requirement can be implemented by CBP.
Consol. Court No. 11-00216 Page 21
decision has been formalized and its effects felt in a concrete
way by the challenging parties." Abbott Labs. v. Gardener, 387
U.S. 136, 148-9 (1967), abrogated on other grounds by Califano
v. Sanders, 430 U.S. 99 (1977). Specifically, a claim is not
ripe if it is based on "contingent future events that may not
occur as anticipated, or indeed may not occur at all." Thomas v.
Union Carbide Agricultural Products Co., 473 U.S. 568, 580-81
(quoting 13A Charles Alan Wright, Arthur R. Miller, & Edward H.
Cooper, Federal Practice and Procedure § 3532 (1984)).
Adjudicating the claim brought by the AEFTC regarding the
failure to impose a testing or certification requirement in the
CBP instructions carries precisely this danger.20 The CBP
instructions have not yet been acted upon, and it is not yet
possible to evaluate whether the instructions as presently
written will result in the unlawful admission of aluminum heat
sinks that are not entitled to the Commission's FHS exclusion.
The points raised by the Plaintiff, while plausible, remain at
this stage hypothetical. Adjudication of the issue would
20
All Federal Courts, obliged to follow Constitutional
restrictions on their actions, properly consider ripeness
questions even when not raised or contested by the parties. Reno
v. Catholic Soc. Servs., 509 U.S. 43, 56 n. 18 (1993);
Blanchette v. Connecticut Gen. Ins. Corporations, 419 U.S. 102,
138 (1974).
Consol. Court No. 11-00216 Page 22
necessarily be speculative and ungrounded in the record evidence
that would stem from the agency’s consideration.
Courts may, under some circumstances, evaluate and rule on
challenges to administrative decisions before their
implementation. A claim may be deemed ripe despite its
prospective nature if two conditions are met: (1) The plaintiff
must demonstrate that they will suffer some serious hardship if
judicial review is withheld and the administrative policy is
implemented. Abbott Labs, 387 U.S. at 149. (2) Both the record
and the issues must be fit for judicial review. To evaluate
this second condition, we must determine, inter alia, whether
the court "would benefit from the further factual development of
the issues presented." Ohio Forestry Ass'n v. Sierra Club, 523
U.S. 726, 733 (1998).
Neither of these conditions for pre-enforcement judgment
are present in the instant case. Plaintiff has not alleged any
particular and serious hardship that it would actually suffer as
a result of the failure to impose a testing or certification
requirement on FHS imports. Plaintiff in this case, unlike the
drug manufacturers seeking review in Abbott Labs, is neither
faced with the prospect of certain and direct harm if the
contested determination is enforced, nor an uncertain future
Consol. Court No. 11-00216 Page 23
path to judicial review.21 Rather, Plaintiff faces only a
speculative harm for which, were it to occur, the path for
review is clear under Section 702 of the Administrative
Procedure Act and 28 U.S.C. 1581(i)4.22
In addition, the further development of the factual record
would allow the court to evaluate the effectiveness of CBP and
of the Department's instructions in implementing the
Commission’s scope findings by examining specific failures or
problems. After some period of enforcement, any problems CBP
might have in properly implementing the scope of the Commissions
FHS exclusion will be more concrete and apparent. This will
allow for a more informed evaluation based on a more complete
factual record, better reflecting both the practical strengths
and Constitutional mandate of the judiciary.
21
The Court in Abbott Labs was careful to distinguish the
exceptional, multifaceted, and nearly certain prospective harms
faced by plaintiff drug manufacturers from the mere “damage or
loss of income” that was found inadequate to sustain prospective
review for steel producers challenging the Public Contracts Act
in Perkins v. Lukens Steel Co., 310 U.S. 113, 125. Abbott Labs,
387 U.S. at 153.
22
See Shinyei Corp. of Am. v. United States, 355 F.3d 1297, 1306
(Fed. Cir. 2004) (finding CIT jurisdiction under §1581(i)4 “if
Commerce instructions [to CBP] are inaccurate or incorrect”).
Consol. Court No. 11-00216 Page 24
CONCLUSION
For the foregoing reasons, the definition contained in the
Department's AD and CVD orders is AFFIRMED and the challenge to
the Department's CBP instructions is DISMISSED.23 Judgment will
be entered accordingly.
It is so ORDERED.
____/s/ Donald C. Pogue_____
Donald C. Pogue, Chief Judge
Dated: January 23, 2014
New York, NY
23
The Plaintiff's additional claim regarding the failure of the
Department to initiate an investigation of currency subsidies,
having not been addressed in its opening brief as required by
USCIT R. 52.2(c), is also deemed abandoned and is therefore
DISMISSED.