Plaintiffs in Conflict-of-Interest Suit Want Former Counsel Barred From ITC Proceeding Pending Appeal

The case concerns a past ITC injury investigation on freight rail couplers and parts thereof from China and a present injury investigation on the same goods from China and Mexico. ARC is a U.S. producer and importer of freight rail couplers, and originally employed Wiley Rein, where Pickard was a partner at the time, to represent it. Pickard filed an antidumping and countervailing duty petition on behalf of ARC and McConway and Torley (M&T) to start the prior injury investigation. ARC then withdrew from the petition, leaving M&T and a labor union as the two petitioners.

In that investigation, the ITC unanimously ruled the U.S. industry was not materially harmed. During the inquiry, Pickard moved from Wiley to Buchanan. Days later, Buchanan filed a petition to start another injury investigation on the freight rail couplers, this time including Mexican imports as well as Chinese ones, with M&T and the union standing as the two petitioners. Mexican imports were included in the petition, despite the fact that the only Mexican imports came from ARC's affiliate ASF-K, a maquiladora factory and fellow plaintiff in the court action.

Describing this as a "betrayal," ARC took to the ITC, then the CIT, to argue that Pickard and Buchanan should be disqualified from the proceeding and dismissed from the administrative protective order (APO). The ITC ruled against the plaintiffs, refusing to initiate an investigation of the alleged misconduct. At the trade court, ARC argued that the ITC's decision to give business proprietary information access to Buchanan violated the Administrative Procedure Act and its Fifth Amendment rights (see 2210170084). Pickard and the ITC moved to dismiss the case on jurisdictional grounds, among other claims (see 2210250026).

Judge Gary Katzmann agreed with the defendants and dismissed the action (see 2211160057). The plaintiffs filed the suit under Section 1581(i), the court's "residual" jurisdiction, which only stands if the other elements of Section 1581 are "manifestly inadequate." Katzmann said that the plaintiffs failed to prove that the other sections, namely Section 1581(c), was manifestly inadequate, though the judge left the door open for the plaintiffs to refile their case when the ITC proceedings are complete and the Section 1581(c) claims become ripe.

Moving now for an injunction against Pickard and Buchanan's involvement in the proceedings pending an appeal, the plaintiffs argue that they have met the grounds for a stay and that the court committed a reversible legal error. "Critically, the Court improperly shifted the burden to Plaintiffs to identify specific client confidences ARC shared with the Coalition’s counsel, as well as how those confidences are relevant to the Current Investigations," the brief said. "The law does not require -- and in fact expressly forbids -- the very evidentiary showing the Court demands. The Court’s conclusion otherwise constitutes reversible error."

The plaintiffs further alleged that they will be "irreparably harmed" without the stay pending appeal. "In short, the unfair advantage enjoyed by the Coalition as a result of its counsel’s disabling conflict of interest arising from his representation of ARC in a substantially related matter is not something the Commission or the courts can 'undo' following final determinations," the brief said. "The harm is ongoing in nature and will taint the entire proceedings. Thus, irreparable harm will occur without an injunction pending appeal."