Trade Courts Update for Week of June 22, 2016

United States Court of International Trade


Motion to Intervene Denied

Neo Solar Power Corporation v. United States., concerns a challenge to the Department of Commerce’s (“Commerce”) decision rejecting Plaintiff Neo’s request to be included in the administrative review of the antidumping duty order on certain crystalline silicone photovoltaic products from Taiwan, covering the period from July 31, 2014 through January 31, 2016.  Court No. 16-00088, Slip Op. 16-60 (June 17, 2016).  Proposed defendant-intervenor SolarWolrd Americas, Inc. sought permissive intervention in the action. 

The Court denied SolarWorld’s motion to intervene.  At the outset, the Court noted that proposed defendant-intervenor failed to file a pleading indicating claims or defenses to be raised pursuant to the requirement of the U.S. Court of International Trade (“USCIT”) Rule 24(c)(1).  The Court reasoned that intervention would add additional time, effort, and expense, which would conflict with USCIT Rule 1, which instructs that the rules be “construed and administrative to secure the just, speedy, and inexpensive determination of every action.” Furthermore, the argument SolarWorld would raise in defense of Commerce’s action is the same as that which the government has already presented, and it is the government’s interest in enforcing regulations pertaining to the timelines of submissions that is at issue in the action.  Finally, the Court reasoned, SolarWorld would have the opportunity to challenge plaintiff’s participation, should plaintiff prevail in the action at bar, in a case brought under 28 U.S.C. § 1581(c), challenging the results of the administrative review.


Counts II and III Dismissed

In United States v. Leslie M. Toth and LBS Marketing Inc., the Government brought an action against defendants to enforce a 2010 penalty notice for the allegedly fraudulent misclassification of certain crawfish meat.  Court No. 15-00206, Slip Op. 16-61 (June 20, 2016).  Before the Court was defendants’ partial motion to dismiss Counts II and III of the Complaint, which alleged the alternative theories of liability for the misclassification as a result of gross negligence and as a result of negligence, pursuant to USCIT Rule 12(b)(6) for failure to state a claim upon which relief can be granted.  Specifically, defendants’ argued that the Government failed to exhaust administrative responsibilities on these counts.

The Court granted defendants’ motion and dismissed Counts II and III of the Complaint.  Both the pre-penalty and subsequent penalty notice indicated the level of culpability for violations under 19 U.S.C. § 1592 to be fraud and not gross negligence or negligence.  Therefore, the precedential decision from the Court of Appeals for the Federal Circuit (“CAFC”), United States v. Nitek Electronics, Inc., required the dismissal of both Counts.  806 F.3d 1376 (Fed. Cir. 2015).  There, the CAFC affirmed the CIT’s decision granting a motion to dismiss counts involving levels of culpability not alleged in the penalty notices, holding that “penalty claims based on fraud, gross negligence, or negligence are separate claims…each culpability level is a separate claim and [CBP] chooses which culpability level or levels to assert against the importer.”  Id. at 1380.  Furthermore, the Court denied the Government’s request for voluntary remand, reasoning that the Government brought this action as the plaintiff and there was not a challenged agency decision in which remand can be ordered.  As such, the only decision to be made was to deny or grant the motion to dismiss for failure to state claims upon which relief can be granted.