Risen Energy Co. v. United States , 2023 CIT 168 ( 2023 )

Slip Op. 23-
UNITED STATES COURT OF INTERNATIONAL TRADE
RISEN ENERGY CO., LTD.,
Plaintiff,
v.
UNITED STATES, Before: Jane A. Restani, Judge
Defendant, Court No. 23-00153
and
AMERICAN ALLIANCE FOR
SOLAR MANUFACTURING,
Defendant-Intervenor.
MEMORANDUM AND ORDER
[Plaintiff’s motion to amend complaint is denied.]
Dated: November 30, 2023
Gregory S. Menegaz, deKieffer & Horgan, PLLC, of Washington, DC, for Plaintiff.
Joshua E. Kurland, Commercial Litigation Branch, U.S. Department of Justice, of Washington,
DC, for Defendant. With him on the brief were Brian M. Boynton, Patricia M. McCarthy, and
Reginald T. Blades, Jr. Of counsel on the brief was Spencer Neff, Office of Chief Counsel for
Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC.
Timothy C. Brightbill, Wiley Rein, LLP, of Washington, DC, for Defendant-Intervenor.
Restani, Judge: Before the court is Risen Energy Company’s (“Risen”) motion to file an
amended complaint. Risen Mot. to Amend Compl., ECF No. 21 (Oct. 19, 2023) (“Risen Mot. to
Amend”). On September 11, 2023, Risen filed its initial complaint to contest the United States
Court No. 23–00153 Page 2
Department of Commerce’s (“Commerce”) final results of administrative review as published in
Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the
People’s Republic of China: Final Results and Partial Recission of Countervailing Duty
Administrative Review; 2020, 88 Fed. Reg. 44,108 (Dep’t Commerce July 11, 2023). See Compl.,
ECF No. 8 (Sep. 11, 2023). A month later, the court issued a decision in Risen Energy Co. v.
United States, Slip. Op. 23-148, 2023 WL 6620508 (CIT Oct. 11, 2023) (“Risen”). In Risen, the
court concluded that the Article 26(2) program is not a de jure specific countervailable subsidy.
Id. at *4–5. Risen then filed this motion, requesting to amend the complaint that is currently before
this court to include a claim that the Article 26(2) program is not specific and thus not
countervailable. Risen Mot. to Amend at 6.
It is uncontested that Risen did not raise this claim at any point before the agency. See
Risen Mot. to Amend at 2; see also Commerce Resp. to Mot. to Amend Compl. at 3, ECF No. 25
(Nov. 9, 2023) (“Commerce Resp.”). Commerce, opposing the motion, argues that because the
claim was not exhausted at the agency level, the court should deny this request as futile as Risen
will lose on exhaustion grounds. Commerce Resp. at 1–3. Risen contends that the exception to
exhaustion for intervening case law ought to govern, allowing Risen to amend its complaint despite
its failure to exhaust administrative remedies on this issue. Risen Mot. to Amend at 3. Risen
further argues that the strong interest in accurately calculating countervailing duties weighs in
favor of waiving the exhaustion requirements in this case. Id. at 5.
The court will ordinarily liberally allow amendment of a complaint “where justice requires
it,” but need not allow amendment where amendment would be “futile.” USCIT Rule 15(a)(2);
see Kemin Foods, L.C. v. Pigmentos Vegetales Del Centro S.A. de C.V., 464 F.3d 1339, 1353
(Fed. Cir. 2006) (“[L]eave to amend may be denied if the court finds that there has been undue
Court No. 23–00153 Page 3
delay that would prejudice the nonmoving party, that the moving party has acted in bad faith, or
that the amendment would be futile.”). Here, this type of exhaustion is not jurisdictional, and the
court applies it when “appropriate.” Ceramica Regiomontana, S.A. v. United States, 16 CIT 358,
359 (1992). The intervening case law exception applies to issues that present a “pure question of
law.” Agro Dutch Industries Ltd. v. United States, 508 F.3d 1024, 1029 (Fed. Cir. 2007). An
issue raises a pure legal question where plaintiffs “raise a new argument that is of a purely legal
nature, [and] the inquiry [does] not require further agency involvement, additional fact finding, or
opening up of the record . . . .” Gerber Food (Yunnan) Co. v. United States, 33 CIT 186, 195–96,
601 F. Supp. 2d 1370, 1380 (2009). When required, exhaustion serves two main purposes: “to
allow an administrative agency to perform functions within its special competence—to make a
factual record, to apply its expertise, and to correct its own errors,” and to “promot[e] judicial
efficiency by enabling an agency to correct its own errors so as to moot judicial controversies.”
Sandvik Steel Co. v. United States, 164 F.3d 596, 600 (Fed. Cir. 1998).
Here, waiver of the exhaustion requirement is inappropriate because Risen does not raise
a “pure question of law.” Risen misunderstands the claim it is trying to raise; the claim it seeks to
bring to the court is not whether the Article 26(2) program is de jure specific, but whether the
Article 26(2) program is a countervailable subsidy. See Risen *4–5. Examination of this claim
would require further development of the record, which means that it does not present a purely
legal issue, and thus the intervening case law exception to exhaustion requirements does not apply.
See Gerber, 33 CIT at 195–96, 601 F. Supp. 2d at 1380. In Risen, Commerce was given the
opportunity to refine its explanation and still failed to articulate a reasonable explanation of why
the Article 26(2) program was countervailable. See Risen at *4–5. It is far from certain that this
would have been the case here. The claim Risen neglected to raise here had already been raised
Court No. 23–00153 Page 4
by Risen’s co-plaintiff, JingAo Solar Co., Ltd. (“JA Solar”), in the litigation that then was ongoing
in Risen. See id. It is possible, as the Government points out, that, had this program been objected
to here, Commerce might have chosen to shore up its specificity analysis with an alternative
argument that the program was de facto specific. See Commerce Resp. at 3, 8. The court has not
ruled on whether a de facto specific analysis might support a finding that this program is
countervailable, and certainly cannot do so without a fully developed record—a fact that was noted
in Risen itself. Risen, at *5 n.3. Given the undeveloped record in this case, the interest in accuracy
that Risen argues would support waiving exhaustion actually favors requiring exhaustion here; the
court cannot accurately make an assessment of this program without a record in front of it. Because
Risen did not object to this program at the agency level, a full record, addressing all of these issues,
does not exist. Waiver of the exhaustion requirement is therefore inappropriate in this case. See
Gerber, 33 CIT at 195–96, 601 F. Supp. 2d at 1380 (noting that waiver of exhaustion is appropriate
where no further development of the record is required of the Agency).
Further, this is not a case where the court’s decision not to waive exhaustion requirements
causes a grave injustice. Risen was a party to the litigation regarding the prior administrative
review period in which its co-plaintiff, JA Solar, raised this argument. See Decision Memorandum
for the Preliminary Results of the Countervailing Duty Order on Crystalline Silicon Photovoltaic
Cells, Whether or Not Assembled Into Modules, from the People's Republic of China, C-570-980,
POR 01/01/2019-12/31/2019 (Dep't Commerce Dec. 30, 2021) (“2019 PDM”); see also Issues
and Decision Memorandum for Final Results of the Administrative Review of the Countervailing
Duty Order on Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules,
from the People’s Republic of China, C-570-980, POR 01/01/2019-12/31/2019 (Dep’t Commerce
June 29, 2022) (“2019 IDM”); see also Risen at *1, *4–5. Accordingly, Risen was on notice that
Court No. 23–00153 Page 5
the specificity issue existed; it might have argued it before the agency. The intervening case law
exception exists to remedy cases where parties are “surprised” by a twist of the law that is
impossible to predict. See Ceramica, 16 CIT at 361. Here, Risen cannot possibly argue that it was
surprised by the existence of this issue; it was the lead plaintiff in the case to which it cites. Risen
at *1. It was a mandatory respondent in the 2019 administrative review in which the specificity
of the Article 26(2) program was first raised. See 2019 PDM; see also 2019 IDM. The Preliminary
Decision Memorandum for this case was not issued until 2023. See Decision Memorandum for
the Preliminary Results of the Countervailing Duty Administrative Review, Rescission in Part,
and Preliminary Intent to Rescind in Part: Crystalline Silicon Photovoltaic Cells, Whether or Not
Assembled into Modules, from the People’s Republic of China at 52, C-570-980, POR
01/01/2020-12/31/2020 (Dep’t Commerce Jan. 3, 2023). The specificity issue is not now a
surprise. At best, Risen may argue that it did not expect the court to decide in JA Solar’s favor
and, having seen the ruling, it now wishes to benefit from a newly formed expectation that the
court would decide for it on this previously unraised matter. Risen’s decision not to raise this
claim earlier, however, has deprived Commerce of both the ability to make a record, and the
opportunity to “correct its own errors.” See Sandvik Steel, 164 F.3d at 600.
Parties are free to make strategic decisions about what they wish to contest at the agency
level. The court cannot comment on why Risen did not raise this matter, as it is not explained by
Risen, but justice does not favor ignoring exhaustion principles here. When a party declines to
contest a matter at the agency level while its co-plaintiff in an ongoing separate case does so,
exhaustion will not give way to an exception designed to give shelter to plaintiffs surprised by the
law. The only intervening factor in this case is JA Solar’s victory. That alone is not enough reason
Court No. 23–00153 Page 6
to allow Risen to amend this complaint to an add a claim that it previously has made the decision
not to make before the agency.
As Risen would fail on exhaustion grounds if this complaint were amended, interests in
efficiency support denying this motion, rather than granting it and allowing further briefing to no
end.
For the forgoing reasons, the court DENIES the motion to amend.
/s/ Jane A. Restani
Jane A. Restani, Judge
Dated: November 2023
New York, New York