GPX Int'l Tire Corp. v. United States

• Decision Date: 07 January 2013
• Court: U.S. Court of International Trade
• Parties: GPX INTERNATIONAL TIRE CORPORATION and Hebei Starbright Tire Co., Ltd., Plaintiffs, Tianjin United Tire & Rubber International Co., Ltd., Consolidated Plaintiff, v. UNITED STATES, Defendant, and Bridgestone Americas, Inc., Bridgestone Americas Tire Operations, LLC, Titan Tire Corporation, and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO–CLC, Intervenor Defendants.

893 F.Supp.2d 1296

GPX INTERNATIONAL TIRE CORPORATION and Hebei Starbright Tire Co., Ltd., Plaintiffs,Tianjin United Tire & Rubber International Co., Ltd., Consolidated Plaintiff,

v. UNITED STATES, Defendant,andBridgestone Americas, Inc., Bridgestone Americas Tire Operations, LLC, Titan Tire Corporation, and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO–CLC, Intervenor Defendants.

United States Court of

International Trade.

Slip Op. 13–2.

Court No. 08–00285.

Jan. 7, 2013.

On Constitutional Issues:

James P. Durling and Matthew P. McCullough, Curtis Mallet–Prevost, Colt & Mosle LLP, of Washington, DC, argued for the Plaintiffs GPX International Tire Corporation and Hebei Starbright Tire Co., Ltd. With them on the brief were William H. Barringer, Daniel L. Porter, and Ross E. Bidlingmaier.

Mark B. Lehnardt, Lehnardt & Lehnardt, LLC, of Liberty, MO, argued for Consolidated Plaintiff Tianjin United Tire & Rubber International Co., Ltd.

Alexander V. Sverdlov, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, argued for the Defendant. With him on the brief were Stuart F. Delery, Acting Assistant Attorney General, Jeanne E. Davidson, Director, Franklin E. White, Jr., Assistant Director, and L. Misha Preheim, Trial Attorney. Of counsel on the brief were John D. McInerney, Chief Counsel for Import Administration, Daniel J. Calhoun, Attorney, and Devin S. Sikes, Attorney, U.S. Department of Commerce, of Washington, DC.

Wesley K. Caine, Stewart and Stewart, of Washington, DC, argued for the Intervenor Defendants Titan Tire Corporation and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO–CLC. With him on the brief were Terence P. Stewart and Elizabeth J. Drake.

Joseph W. Dorn and J. Michael Taylor, King & Spalding, LLP, of Washington, DC, for Intervenor Defendants Bridgestone Americas Tire Operations, LLC and Bridgestone Americas, Inc.

On CVD Issues:

William H. Barringer, Daniel L. Porter, James P. Durling, Matthew P. McCullough, and Ross Bidlingmaier, Winston & Strawn LLP, of Washington, DC, for the Plaintiffs GPX International Tire Corporation and Hebei Starbright Tire Co., Ltd.

Philippe M. Bruno and Rosa S. Jeong, Greenberg Traurig, LLP, of Washington, DC, for Consolidated Plaintiff Tianjin United Tire & Rubber International Co., Ltd. on the motion for judgment on the agency record. Francis J. Sailer and Andrew T. Schutz, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, of Washington, DC, for Consolidated Plaintiff Tianjin United Tire & Rubber International Co., Ltd. on the remand comments.

John J. Todor, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for the Defendant. With him on the brief were Tony West, Assistant Attorney General Jeanne E. Davidson, Director, Franklin E. White, Jr., Assistant Director. Of counsel on the brief were Ahran K. McCloskey and Matthew D. Walden Attorneys, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, of Washington, DC.

Terence P. Stewart, Wesley K. Caine, Geert M. De Prest, and Elizabeth J. Drake, Stewart and Stewart, of Washington, DC, for the Intervenor Defendants

Titan Tire Corporation and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO–CLC.

Joseph W. Dorn, J. Michael Taylor, and Christopher T. Cloutier, King & Spalding, LLP, of Washington, DC, for Intervenor Defendants Bridgestone Americas Tire Operations, LLC and Bridgestone Americas, Inc.

OPINION AND ORDER

RESTANI, Judge:

This action challenges the Department of Commerce's (“Commerce”) final determination in a countervailing duty (“CVD”) investigation of certain pneumatic off-the-road (“OTR”) tires from the People's Republic of China (“PRC”). See Certain Pneumatic Off-the-Road Tires from the People's Republic of China, 72 Fed. Reg. 44,122 (Dep't Commerce Aug. 7, 2007) (initiation of CVD investigation); Certain New Pneumatic Off-the-Road Tires from the People's Republic of China, 73 Fed. Reg. 40,480 (Dep't Commerce July 15, 2008) (“ Final Determination ”); see also Issues and Decision Memorandum for the Final Affirmative Countervailing Duty Determination: Certain New Pneumatic Off-the-Road Tires (OTR Tires) from the People's Republic of China, C–570–913, POI: 1/01/06–12/30/06 (July 7, 2008), available at http:// ia. ita. doc. gov/ frn/ summary/ prc/ E 8– 16154– 1. pdf (last visited Dec. 21, 2012) (“ I & D Memo ”).¹ GPX International Tire Corporation (“GPX”), Hebei Starbright Tire Co., Ltd. (“Starbright”) ² and Tianjin United Tire & Rubber International Co. Ltd. (“TUTRIC”) (collectively “Plaintiffs”) challenge various aspects of the Final Determination and the Final Results of Redetermination Pursuant to Remand (Apr. 26, 2010), available at http:// ia. ita. doc. gov/ remands/ 09– 103. pdf (last visited Dec. 21, 2012) (“ First Remand ”). They also challenge the constitutionality of a new law passed during the course of this litigation. SeePub. L. No. 112–99, 126 Stat. 265–66 (2012) (the “New Law”) (The New Law is attached as an appendix to this opinion.). Defendant as well as Titan Tire Corporation and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO–CLC (collectively “Titan”) and Bridgestone Americas, Inc. and Bridgestone Americas Tire Operations, LLC (collectively “Bridgestone”) oppose the Plaintiffs' claims, and Titan and Bridgestone have filed their own challenges to the Final Determination.³ For the reasons set forth below, the court finds that the New Law is constitutional but remands to Commerce to re-analyze whether countervailable subsidies were extinguished and, if not, to explain or reconsider its calculation of the resulting CVD rates.

BACKGROUND

The court assumes general familiarity with the long procedural history of this case that was first filed in 2008. For ease of understanding, however, a summary is provided below.

Plaintiffs first filed this case in 2008, challenging Commerce's Final Determination. The investigation into Plaintiffs' product was one of the first cases in which Commerce imposed CVDs on products from the PRC after determining that it was possible to identify and measure subsidies in China. Commerce altered its previous practice, in which it did not apply CVD in non-market economies (“NME”), relying instead in those cases on its NME AD methodology to remedy unfair trade practices.⁴ Commerce based its change in policy on the evolution of China's economy from a centrally-controlled monolithic economy towards a market economy. This court initially determined that Commerce's imposition of CVDs was based on an unreasonable interpretation of the Tariff Act of 1930, as amended, unless Commerce developed a methodology to ensure that goods covered by concurrent AD and CVD orders would not be subject to overlapping remedies. GPX Int'l Tire Corp. v. United States, 645 F.Supp.2d 1231, 1251 (CIT 2009) (“ GPX II ”).⁵ Upon remand, Commerce informed the court that it did not have a method for identifying any overlapping remedies, and therefore, it decided under protest to offset AD rates by the calculated CVD rates. GPX Int'l Tire Corp. v. United States, 715 F.Supp.2d 1337, 1345 (CIT 2010) (“ GPX III ”). Because this was contrary to law and rendered the CVD investigation and resulting duties meaningless, the court ordered Commerce to forgo the imposition of CVDs in this case. Id. at 1354. Under protest again, Commerce complied, and this court issued final judgment sustaining that determination. GPX Int'l Tire Corp. v. United States, Slip Op. 10–112, 2010 WL 3835022 (CIT Oct. 1, 2010) (“ GPX IV ”).

On appeal, the Court of Appeals for the Federal Circuit (“CAFC”) initially affirmed the decision of this court, although upon different grounds. GPX Int'l Tire Corp. v. United States, 666 F.3d 732, 745 (Fed.Cir.2011) (“ GPX V ”). In its opinion, the CAFC determined that the CVD statute unambiguously prohibited Commerce from imposing CVDs on goods from China, finding that Congress had ratified Commerce's prior practice when amending the Tariff Act. Id.

After the panel opinion was filed in the CAFC but before the court's mandate was issued, the Secretary of Commerce and U.S. Trade Representative sent urgent letters to Congress seeking an amendment of the law to reverse the decision of the CAFC. See Letter from Secretary of Commerce John Bryson and U.S. Trade Representative Ron Kirk, Jan. 18, 2012, attached to Resp. of Titan Tire Corp. and the United Steelworkers Union, Qua Def–Intvnrs., to the Rule 56.2 Mots. of GPX, Starbright, and TUTRIC, Qua Pls. Asserting Constitutional Claims in Accord. with this Hon. Ct.'s Order of July 3, 2012 (“Titan Br.”). While a petition for rehearing en banc was pending, Congress enacted the New Law. The law was adopted after limited debate on the House floor and without any comment in the Senate. See 158 Cong. Rec. H1166–73 (daily ed. Mar. 6, 2012).

The New Law contains two sections. Section 1 amends the Tariff Act of 1930 to require Commerce to impose CVDs on identified subsidies from NMEs. New Law, 126 Stat. 265–66. The section does provide an exception to this requirement when “the administering authority is unable to identify and measure subsidies provided by the government of the nonmarket economy country or a public entity within the territory of the nonmarket economy country because the economy of that country is essentially comprised of a single entity.” Id.Section 2 “requires” Commerce to account for potential overlapping remedies by reducing the AD rate to the extent that Commerce is able to reasonably estimate the amount that the countervailable subsidy has increased the “normal...