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Commerce Unlawfully Shifted Interpretations of Scope Rulings, Canvas Importer Says in CIT Complaint

The Commerce Department erred when it found that canvas banner matisse imported by Berger Textiles was subject to the antidumping duty order on certain artists' canvas from China was in error, said Berger in a Sept. 15 complaint at the Court of International Trade. Berger asked the court to find that the matisse is expressly outside the scope of the orders and to remand the issue back to Commerce (Berger Textiles v. U.S., CIT # 23-00192).

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Berger argued that the scope made clear that the subject merchandise required a priming or coating that "promotes the adherence of artistic materials" and included no requirement for an ink receptive top coat. Commerce both falsely assigned characteristics to Berger's matisse and misinterpreted and shifted previous scope rulings to change their meanings, Berger said.

Commerce falsely asserted that the canvas banner matisse was "receptive to artist materials” despite the material being "clearly not designed to promote the adherence of artist materials," Berger said. The matisse is instead designed to convert a canvas, is required to stiffen the fabric, and provides whiteness and higher opacity to the translucent polyester fabric.

Commerce unlawfully shifted interpretations of the scope language over time, Berger said. The department regularly interchanged "adherence" with "receptive/receptivity" terms and added purpose requirements where none existed. Commerce failed to recognize that there is no ink receptive top coat requirement within the scope, which it also failed to address.

Commerce must address the requirement that subject materials are "designed to promote the adherence of artist materials," Berger said. The requirements define "an essential physical characteristic," which Commerce ignored in its scope ruling. Neither the petitioner, nor Commerce defined the meaning of “adherence” in regard to the order during the investigation, Berger said. "Commerce’s failure to address this point renders its scope determination as unsupported by substantial evidence."

Berger also argued that Commerce unlawfully relied on language from the International Trade Commission that defined artist canvas despite the Commission's role being limited to domestic industry injury.

Berger argued in its ruling request that Commerce had impermissibly expanded the scope over the course of several prior rulings since 2015 and had relied on new definitions in each successive ruling during the period, where it had unlawfully determined that top coatings caused the merchandise to fall under the scope.

In its August scope ruling, Commerce was unconvinced and said that it isn't required to explicitly define every term used in a scope language. Commerce is required to include a description of the subject merchandise in as much detail as the department deems necessary in AD and CVD orders, Commerce said. It also argued that the U.S. Court of Appeals for the Federal Circuit has found that the agency has broad authority to interpret the scope of AD/CVD orders (see 2308170067).