EAPA Litigation

Importers found to have evaded antidumping and countervailing duty orders on hardwood plywood from China argue for a greater due process rights in evasion investigations than Congress deemed fit to provide, the evasion alleger Coalition for Fair Trade in Hardwood Plywood said in a Dec. 30 brief at the Court of International Trade supporting CBP's Enforce and Protect Act finding. Responding to a motion for judgment from the importers, led by American Pacific Plywood, the coalition said that the statute doesn't require the disclosure of confidential information during EAPA investigations (American Pacific Plywood, Inc. et al. v. U.S., CIT Consol. #20-03914).

While the companies found to have evaded antidumping and countervailing duties on hardwood plywood from China argue that the evasion investigation deprived them of their due process rights, this is not how Congress set up the evasion statute, the Department of Justice argued in a Dec. 10 brief. Opposing the plaintiffs, led by American Pacific Plywood, at the Court of International Trade, DOJ said that the Enforce and Protect Act does not require CBP to notify a party that it's under investigation nor give a company access to confidential information or an opportunity to be heard. DOJ also made the case to CIT that the facts back up its ultimate evasion finding (American Pacific Plywood, Inc. et al. v. United States, CIT Consol. #20-03914).

CBP continued to find that Leco Supply Co. continued to evade antidumping and countervailing duties on wire hangers from Vietnam, after voluntarily requesting a remand from the Court of International Trade to reconsider the case. Submitting its results in a Nov. 10 filing at CIT, CBP included information not previously considered in its determination and also released revised public summaries of the business confidential information (BCI), in line with a recent CIT decision (Leco Supply, Inc. v. United States, CIT #21-00136).

CBP did not violate importer Diamond Tools Technology's due process rights when it found that the company evaded antidumping duties on diamond sawblades from China, the Court of International Trade said in an Oct. 29 opinion, made public Nov. 5. However, Judge Timothy Reif did remand the case to CBP, finding that the actual finding of evasion was not supported as there was no "material and false statement" made by DTT. The judge also upheld CBP's authority to find that DTT's entries that pre-dated the start date of a related anti-circumvention inquiry are "covered merchandise."

The Justice Department moved for a voluntary remand in a duty evasion case after finding out that the parties to the investigation were not provided with certain documents in the investigation. DOJ argued that the remand should be granted since the parties should have the chance to make arguments to CBP based on this withheld information to inform the ultimate evasion decision (Norca Industrial Company, LLC et al. v. U.S., CIT #21-00192).

The U.S. requested the chance to take another look at an Enforce and Protect Act investigation to consider documents that were not sent from one CBP office to another, in a July 30 motion for remand in the Court of International Trade. The agency also sought the remand in light of the court's decision in Royal Brush v. United States, in which CIT held that CBP failed to provide adequate public summaries of business confidential information (BCI) (see 2012020050). The plaintiff in the case, Leco Supply, opposed the remand request, arguing that it is "too broad to be justifiable" under the court's standards for allowing remands (Leco Supply, Inc. v. United States, CIT #21-00136).

Many cases challenging findings of antidumping or countervailing duty evasion under the Enforce and Protect Act include claims that the process has violated an importer's constitutional rights, particularly under the Fifth Amendment. Case after case in the Court of International Trade argues elements of the EAPA process -- from the lack of notice provided to an importer that it's under investigation to the insufficient public summaries of proprietary information in the investigation -- violate importers' due process rights under the U.S. Constitution. However, the circumstances under which these claims may actually be heard by CIT may have yet to come, trade lawyers said.

Following a court-ordered remand to address due process concerns in an Enforce and Protect Act case, CBP has failed again to provide Royal Brush Manufacturing “notice and a meaningful opportunity to be heard,” the importer argued in an April 26 response to CBP's remand redetermination. Despite some changes to comply with the Court of International Trade decision that found fault with CBP's finding that Royal Brush evaded antidumping duties on cased pencils from China by way of transshipment through the Philippines, Royal Brush continued to take issue with CBP's public summaries of key case information and the agency's failure to properly notify the company when new factual information surfaced via a verification report.

CBP's process for carrying out Enforce and Protect Act investigations could eventually be found by the courts to be unconstitutional, trade lawyers Jen Diaz and David Craven of Diaz Trade Law said during an April 21 webinar. The EAPA investigations, which seek to determine if a company evaded antidumping or countervailing duty orders, are mostly secret and do not inform entities if they are being investigated or what evidence stands against them.