Ps Chez Sidney v. U.S. Intern. Trade Com'n

• Decision Date: 13 July 2006
• Docket Number: Slip Op. 06-103. Court No. 02-00635.
• Citation: 442 F.Supp.2d 1329
• Parties: PS CHEZ SIDNEY, L.L.C., Plaintiff, v. UNITED STATES INTERNATIONAL TRADE COMMISSION, and United States Custom Service, Defendants, and Crawfish Processors Alliance, et al., Defendant-Intervenors.
• Court: U.S. Court of International Trade

442 F.Supp.2d 1329

PS CHEZ SIDNEY, L.L.C., Plaintiff, v. UNITED STATES INTERNATIONAL TRADE COMMISSION, and United States Custom Service, Defendants, and Crawfish Processors Alliance, et al., Defendant-Intervenors.

Slip Op. 06-103. Court No. 02-00635.

United States Court of International Trade.

July 13, 2006.

Wolff Ardis, P.C., (William. E. Brown), for Plaintiff, PS Chez Sidney, L.L.C.

Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director; Jeanne E. Davidson, Deputy Director;

David S. Silverbrand and Paul D. Kovac, Trial Attorneys, U.S. Department of Justice, Civil Division, Commercial Litigation Branch; Michael Diehl, Attorney-Advisor, Office of the General Counsel, United States International Trade Commission; for Defendant, United States.

Adduci, Mastriani & Schaumberg, LLP, (Will E. Leonard), for Defendant-Intervenors, Crawfish Processors Alliance, Bob Odom, Commissioner, the Louisiana Department of Agriculture and Forestry.

Sonnenschein, Nath & Rosenthal, New York, NY, (Michael A. Bamberger), for Amicus INA USA Corporation.

Arnold & Porter, LLP, Washington, DC (Michael T. Shor and Claire E. Reade), for Amicus Giorgio Foods Inc.

Collier, Shannon, Scott, PLLC, Washington, DC (David A. Hartquist), for Amicus Committee to Support U.S. Trade Laws.

OPINION

WALLACH, Judge.

I Introduction

This case arises out of an effort by Plaintiff, PS Chez Sidney, L.L.C., ("Chez Sidney") a Louisiana seafood producer, to be included in payments to the domestic crawfish industry under the Continued Dumping and Subsidy Offset Act of 2000 ("CDSOA").¹

The court here considers² the constitutionality³ of the CDSOA, which requires the government to pay moneys collected as antidumping duties to any affected U.S. domestic

Plaintiff raised two non-constitutional arguments in its initial Motion For Summary Judgment: 1) that the ITC's reliance on the final questionnaire response was arbitrary and capricious "because the final questionnaire response was not signed, was not certified by an authorized official as complete and correct, did not contain the `name of the establishment(s) covered by this questionnaire,' did not indicate that the `x' in the `Take no position' box was ever authorized or submitted by Chez Sidney Seafood," and 2) that "the ITC misinterpreted the Byrd Amendment by determining that" the initial 1996 questionnaire response did not satisfy the support requirement.

Its first argument fails for waiver because the issue was never raised at the administrative level. The exhaustion doctrine requires a party to present its claims to the relevant administrative agency for consideration before raising them to the court. Timken Co. v. United States, 24 CIT 434, 459, 201 F.Supp.2d 1316 (2002). The court may nonetheless excuse parties from exhausting their administrative remedies in cases where certain exceptions are found. FAG Kugelfischer Georg Schafer AG v. United States, 25 CIT 74, 82, 131 F.Supp.2d 104 (2001) (internal citations omitted). Chez Sidney, however, has not argued that any of them apply. As it stands, its factual claim must fail because it has consistently represented that it, or its predecessor, Chez Sidney Seafood, Inc., did in fact submit the final questionnaire. In the proceedings related to Chez Sidney's Motion for Preliminary Injunction, Chez Sidney affirmatively indicated that it has submitted the questionnaire and that it had checked the box marked "Take no position." Specifically, Chez Sidney stated: "[T]he USITC records show that PS Chez Sidney's predecessor submitted two questionnaire responses, one with the box checked `Support' and one with the box checked `Take No Position.'" Motion for Preliminary Injunction at 6. Chez Sidney further affirmed that "[t]he questionnaire shows that Chez Sidney checked the box marked `Take no position' instead of the box marked `Support.'" Motion for Preliminary Injunction at 2, 6. Chez Sidney's Complaint also affirms that it marked the "Take No Position" box and submitted the final questionnaire. Complaint at ¶ 21 (stating that "[Chez Sidney"] . . . had no knowledge or information that checking the "Take no position" box instead of the "Support" box in the May 5, 1997 Questionnaire would result in denial of eligibility for a distribution of antidumping duties.) These admissions authoritatively refute Chez Sidney's present claim that the final questionnaire response was somehow an unauthorized expression of its position.

As to Plaintiff's second argument, the ITC attempted to resolve the factual question of whether Chez Sidney indicated support for the subject petition. In doing so, it looked to the two questionnaires and gave weight to Chez Sidney's latest expressed position during the investigation. As in Armstrong Bros. Tool Co. v. United States, 84 Cust.Ct. 102, 489 F.Supp. 269 (1980), Chez Sidney here "essentially challengers] discretionary findings by the [ITC]." Id. at 113, 489 F.Supp. 269. In Armstrong Bros., the Customs Court stated: "[I]t is not the function of the court in reviewing an injury determination of the Commission under the Antidumping Act to weigh the evidence or substitute its judgment for that of the Commission." Id. producer, a status defined, in part, as "a petitioner or interested party in support of the petition with respect to which" an antidumping or countervailing duty order has been entered. 19 U.S.C. § 1675c(b)(1)(a) (2000) ("support provision"). At issue is nonpayment to a member of the domestic industry which declined to support the petition.⁴

The court must decide whether the Plaintiff has standing to raise this constitutional challenge to the Government's refusal to pay it a pro rata share of antidumping duties collected as a result of the final affirmative injury determination for the dumping of freshwater crawfish tail meat from China. Notice of Final Determination of Sales at Less Than Fair Value: Freshwater Crawfish Tail Meat From the People's Republic of China, 62 Fed.Reg. 41,347 (August 1, 1997) as amended by Notice of Amendment to Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Freshwater Crawfish Tail Meat From the People's Republic of China, 62 Fed.Reg. 48,218 (September 15, 1997) ("Final Determination"). The Government initially argued that Plaintiff lacked standing to challenge the support provision's constitutionality because Chez Sidney declined to support the petition three years before the CDSOA was enacted. Defendant United States Customs Service Supplemental Brief in Support of the Constitutionality of the [CDSOA] ("Customs Supplemental Brief") at 11. At oral argument, the Government abandoned that position, but continued to maintain Plaintiff lacked standing as to all future injury that might occur as a result of additional distributions or sunset reviews.⁵

Given even the limited concession of standing, the court must determine the constitutionality of the support provision. Plaintiff has argued constitutional violations under both the First Amendment and the Equal Protection Clause of the Fourteenth Amendment.⁶ Finally, if the court determines that a constitutional violation exists, it must find whether the offending portion of the statute is severable from its remaining provisions.

The court has jurisdiction pursuant to 28 U.S.C. § 1581(i). For the reasons set out below, the court has found a violation of the First Amendment, and severability. In sum, however, the court finds that when, as part of an Act of Congress, the Government distributed benefits that are conditioned on what effectively amounts to political support by an otherwise qualified recipient for governmental action, that support requirement is subject to strict scrutiny under the Constitution. Where, as here, the provision fails that scrutiny, Supreme Court authority renders the requirement facially invalid.

II The Uncontested Facts of this Case

In 1996, members of the domestic crawfish tail meat industry, represented by the Crawfish Processors Alliance ("CPA") filed an antidumping petition before the U.S. International Trade Commission ("ITC"), alleging that imports of freshwater crawfish tail meat from the People's Republic of China ("PRC") were being sold in the United States at less than fair value and were materially injuring, or threatening material injury to the domestic crawfish industry. Freshwater Crawfish Tail Meat From the People's Republic of China: Initiation of Antidumping Investigation, 61 Fed.Reg. 54,154, 54,155 (October 17, 1996).⁷

The ITC initiated an antidumping investigation and issued questionnaires to domestic crawfish producers at both the preliminary and final phases of its investigation⁸ The questionnaires required domestic producers to check a box indicating whether they "Support," "Oppose," or "Take No Position" regarding the antidumping petition. Administrative Record ("AR"), Document 65. Chez Sidney checked the box showing its "Support" for the CPA's petition in its October 7, 1996 response to the initial questionnaire. Customs Supplemental Brief at 9-10. On March 26, 1997, the Department of Commerce ("Commerce" or "the Department") published its preliminary determination finding affirmative material injury in its investigation in Notice of Preliminary Determination of Sales at Less Than Fair Value: Freshwater Crawfish Tail Meat From the People's Republic of China, 62 Fed.Reg. 14,392 (March 26, 1997) ("Preliminary Determination").

During the final phase of its injury investigation, the ITC issued a second ITC questionnaire. In its May 5, 1997 response, Chez Sidney answered "Take No Position" to the ITC's support question.⁹ Commerce issued its amended Final Determination on September 15, 1997, affirming its findings in the Preliminary Determination.

Final Determination.

In the interim, the CDSOA was enacted on October 28, 2000. See Discussion of CDSOA under Section V infra. The parties agree that the primary purpose of providing distributions to...