Belgium v. U.S.

• Decision Date: 15 June 2006
• Docket Number: No. 05-1550.,05-1550.
• Citation: 452 F.3d 1289
• Parties: Ugine and Alz BELGIUM, Arcelor Stainless USA, LLC, and Arcelor Trading USA, LLC, Plaintiffs-Appellants, v. UNITED STATES, Defendant-Appellee, and Allegheny Ludlum, AK Steel Corp., Butler Armco Independent Union, United Steelworkers of America, AFL-CIO/CLC, and Zanesville Armco Independent Organization, Defendants-Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1289

452 F.3d 1289

Ugine and Alz BELGIUM, Arcelor Stainless USA, LLC, and Arcelor Trading USA, LLC, Plaintiffs-Appellants, v. UNITED STATES, Defendant-Appellee, and Allegheny Ludlum, AK Steel Corp., Butler Armco Independent Union, United Steelworkers of America, AFL-CIO/CLC, and Zanesville Armco Independent Organization, Defendants-Appellees.

No. 05-1550.

United States Court of Appeals, Federal Circuit.

June 15, 2006.

Wendy E. Ackerman, Shearman & Sterling LLP, of Washington, DC, argued for plaintiffs-appellants. With her on the brief were Stephen J. Marzen, Robert S. LaRussa, Jonathan R. DeFosse, and Ryan A.T. Trapani.

Michael D. Panzera, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, argued for defendant-appellee United States. With him on the brief were Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director; and Patricia M. McCarthy, Assistant Director. Of counsel on the brief were Ada L. Loo and Arthur Sidney, Attorneys International, Office of Chief Counsel for Import Administration, United States Department of Commerce, of Washington, DC; and Christopher Chen, Attorney, United States Customs and Border Protection, of Washington, DC.

Adam H. Gordon, Collier Shannon Scott, PLLC, of Washington, DC, argued for defendants-appellees Allegheny Ludlum, et al. With him on the brief were R Alan Luberda and David A. Hartquist.

Charles H. Bayar, of Scarsdale, New York, for amicus curiae.

Before LOURIE, BRYSON, and GAJARSA, Circuit Judges.

BRYSON, Circuit Judge.

The three appellants, referred to collectively as "Arcelor," appeal from a decision of the Court of International Trade denying a request for a preliminary injunction to prevent U.S. Customs and Border Protection ("Customs") from liquidating certain entries pursuant to liquidation instructions issued by the U.S. Department of Commerce ("Commerce"). Because we conclude that the trial court erred in its analysis of the issue of irreparable harm, we reverse and remand.

I

Arcelor imports stainless steel plate in coils ("SSPC"). In 1998, Commerce initiated antidumping and countervailing duty investigations of SSPC from Belgium. The investigations resulted in the entry of antidumping and countervailing duty orders on Belgian SSPC. Between September 4, 1998, and April 30, 2002, Arcelor imported SSPC for which it declared the country of origin to be Belgium.

Arcelor thereafter determined that it had mistakenly declared Belgium to be the country of origin of its SSPC, whereas it should have declared the country of origin to be Germany. Realizing its mistake, Arcelor filed disclosures and timely protests with Customs under 19 U.S.C. § 1514 to correct the country of origin designation.

During the fourth administrative review of the antidumping order, Arcelor represented that the SSPC that it had imported during the fourth period of review was from Germany. Based on that representation, Commerce determined that Arcelor's entries during that fourth period of review were not subject to the antidumping duty order on SSPC from Belgium. Commerce explained:

For merchandise hot-rolled in Germany, then pickled and annealed in Belgium, the question for purposes of country of origin is whether the process at issue constitutes substantial transformation. In this case, we determine that because hot rolling constitutes substantial transformation, the country of origin of [Arcelor's] merchandise which is hot-rolled in Germany, and not further cold-rolled in Belgium, is Germany.

Commerce issued draft liquidation instructions and subsequently responded to comments from the parties. In its response, Commerce explained that its antidumping calculations for the fourth administrative review did not include Arcelor's sales of German SSPC. Commerce also stated that during the fourth administrative review "neither the Petitioners nor the Respondent raised this country of origin issue with respect to any specific sales reviewed during prior administrative reviews of this order or the effect of the country of origin decision on unliquidated entries from prior closed reviews." Commerce therefore ruled that Arcelor's country-of-origin representation would apply to entries covered by the fourth review and future entries, i.e., to entries made on or after May 1, 2002, but not to entries made prior to that date.

Commerce then issued liquidation instructions, directing Customs to liquidate entries that had been the subject of the fourth administrative review "without regard to antidumping duties." Commerce further instructed Customs to liquidate prior Arcelor entries at the respective antidumping and countervailing duty rates for imports from Belgium, even if those entries were in fact hot-rolled in Germany and not further cold-rolled in Belgium.

Arcelor filed administrative protests with Customs for those entries that had already been liquidated. With respect to the entries that had not yet been liquidated, Arcelor filed a complaint in the Court of International Trade challenging Commerce's liquidation instructions. Arcelor requested, and was granted, a temporary restraining order. It then sought a preliminary injunction to prevent Customs from liquidating any of Arcelor's remaining unliquidated entries while the court considered the case. Both the government and the appellees, representing the domestic industry, consented to the entry of a preliminary injunction. The court, however, denied Arcelor's motion and refused to grant an injunction.

In its order denying the injunction, the court rejected Arcelor's argument that it would suffer irreparable harm from the denial of preliminary injunctive relief. In response to Arcelor's contention that liquidation by Customs would render its cause of action moot and thus deprive Arcelor of its right to judicial review, the court stated that "jurisdiction of the court is not necessarily in jeopardy" because "the plaintiffs claim to have filed timely protests with Customs pursuant to 19 U.S.C. § 1514 which, one could assume, provide them with some current protective comfort." The court also cited Xerox Corp. v. United States, 289 F.3d 792, 795 (Fed.Cir.2002), for the proposition that, for entries yet to be liquidated, "misapplication of an antidumping order or the erroneous imposition of antidumping duties by Customs may be protested and suit brought before the court pursuant to § 1581(a)." For that reason, the court stated, "it [is] now difficult to conclude that plaintiffs' procedural posture herein amounts to unequivocal irreparable harm."

In addition, the trial court concluded that Arcelor was not likely to succeed on the merits. Arcelor had contended that because the entries at issue were not yet liquidated, the principle of administrative finality did not prevent Arcelor from correcting the country of origin. Arcelor asserted that its argument in that regard is supported by the decision in Timken Co. v. United States, 972 F.Supp. 702 (Ct. Int'l Trade 1997), aff'd sub nom. Koyo Seiko Co. v. United States, 155 F.3d 574 (Fed. Cir.1998) (table). The trial court, however, concluded that the Timken case did not support Arcelor's position and that a later order of the Court of International Trade in Torrington Co. v. United States, 24 Ct. Int'l Trade 306 (2000), stood for the opposite proposition. According to the trial court, the Torrington case established that the principle of administrative finality precludes applying a scope determination to unliquidated entries covered by an administrative review that was already closed when the scope issue was first raised. Based on its conclusion that Arcelor had failed to make a persuasive case of irreparable harm or likelihood of success on the merits, the trial court denied the preliminary injunction.

II

In deciding whether to grant or deny a motion for a preliminary injunction, the court must consider the following four factors:

1) that the movant is likely to succeed on the merits at trial; 2) that it will suffer irreparable harm if preliminary relief is not granted; 3) that the balance of the hardships tips in the movant's favor; and 4) that a preliminary injunction will not be contrary to the public interest.

U.S. Ass'n of Importers of Textiles & Apparel v. U.S. Dep't of Commerce, 413 F.3d 1344, 1346 (Fed.Cir.2005). Whether to grant a preliminary injunction is a matter within the trial court's discretion. Asociacion Colombiana de Exportadores de Flores v. United States, 916 F.2d 1571, 1578 (Fed.Cir.1990).

In international trade cases, the Court of International Trade is authorized to grant preliminary injunctions barring liquidation in order to preserve the importer's right to challenge the assessed duties. See Yancheng Baolong Biochemical Prods. Co., Ltd. v. United States, 406 F.3d 1377, 1380-81 (Fed.Cir.2005); Zenith Radio Corp. v. United States, 710 F.2d 806, 809-11 (Fed.Cir.1983); 19 U.S.C. § 1516a(c)(2). In such cases, we have held that when a court considers whether to grant or deny a preliminary injunction, "[n]o one factor, taken individually, is necessarily dispositive," because "the weakness of the showing regarding one factor may be overborne by the strength of the others." FMC Corp. v. United States, 3 F.3d 424, 427 (Fed.Cir.1993). Moreover, as the Court of International Trade has explained, the "greater the potential harm to the plaintiff, the lesser the burden on Plaintiffs to make the required showing of likelihood of success on the merits." SKF USA Inc. v. United States, 316 F.Supp.2d 1322, 1329 (Ct. Int'l Trade 2004); see also Ugine-Savoie Imphy v. United States, 121 F.Supp.2d 684, 689 (Ct. Int'l Trade 2000) ("Where it is clear that the moving party will suffer substantially greater harm by the denial of the preliminary injunction than the non-moving party would by its grant, it will ordinarily be sufficient that the movant has raised `serious, substantial, difficult and...