US Supports Reconsideration Motion in Classification Dispute, Says Holding Missed Key Arguments
Defending a motion for reconsideration, the U.S. said again July 23 that fish oil importer BASF Corp.’s products should have been classified as “food preparations” and that the Court of International Trade defined “fish extracts” too broadly. The trade court failed to address several U.S. points raised during litigation, so the standard for reconsideration has been met, it claimed (BASF Corp. v. United States, CIT Consol. # 13-00318).
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In May, CIT Judge Joseph Laroski ruled that the disputed products, fish oil ethyl ester concentrates, were “extracts of fish” under Harmonized Tariff Schedule heading 1603, not more general “food preparations” under heading 2106 (see 2505020018). The government asked for reconsideration the following month, arguing that the trade court’s definition of a food extract was too broad (see 2506040076). In turn, BASF defended the court’s holding (see 2507020064).
Supporting the motion for reconsideration, the government’s July 23 brief said BASF failed to support the actual definition of “fish extract” reached by the trade court.
Again, the U.S. argued that fish extracts should be defined in a manner “similar to ‘meat extracts,’ which are ‘common flavoring additive[s]’” according to Explanatory Note 16.03. But the trade court didn’t acknowledge this point -- nor did it acknowledge that the importer’s products contain ingredients that don’t occur naturally in fish.
But BASF, rather than defending the court’s finding, only raised a “complaint” that the U.S. had already made this argument in briefing prior to the final holding. This “misunderstands the standard for reconsideration,” the government said. The standard is not whether a particular argument was raised, but rather whether that argument was overlooked.
BASF also argued “as a fallback” that CIT did address the government’s argument, but it could point to only one citation in the opinion to a U.S. brief and “one phrase” that the government’s own definition of fish extracts was “too restrictive,” and this was “too slender a reed to support BASF’s argument,” the U.S. said.
It also argued again that the trade court failed to classify the merchandise in its condition as imported. It said that when CIT described BASF’s fish oil as consisting “almost entirely of substance[s] (fatty acids, glycerides, oligomers, and triglycerides) found in the fish source,” it was incorrect.
But the fish oil as imported is composed of “unnatural ethyl esters of fatty acids that contain non-residual amounts of ethanol -- not fatty acids,” the U.S. said. The trade court, it said, was wrong to define the merchandise as only containing “just naturally occurring fatty acids” without addressing the added ethyl esters and ethanol.
It also said again that BASF’s products neither taste nor smell like fish. BASF didn’t respond to this point “because it has no response,” it said.