Greenfirst Forest Prods. Inc. v. United States
| Decision Date | 20 May 2022 |
| Docket Number | Slip Op. 22-52,Court No. 22-00097 |
| Citation | 577 F.Supp.3d 1349 |
| Parties | GREENFIRST FOREST PRODUCTS INC. and GreenFirst Forest Products (QC) Inc., Plaintiff, v. UNITED STATES, Defendant. |
| Court | U.S. Court of International Trade |
Zachary J. Walker, Andrew W. Kentz, David A. Yocis, Nathaniel Maandig Rickard, Whitney M. Rolig, and Sophia J.C. Lin, Picard, Kentz & Rowe, LLP, of Washington, D.C., for proposed defendant-intervenor.
Sarah E. Shulman, Yohai Baisburd, and Jonathan Zielinski, Cassidy Levy Kent (USA) LLP, of Washington, D.C., for plaintiffs.
Before the court is the Committee Overseeing Action for Lumber International Trade Investigations or Negotiations’ (the "COALITION") motion to intervene as a defendant-intervenor in the above-entitled action. Mot. to Intervene, Apr. 25, 2022, ECF No. 12; see also Memo. of Law in Supp. of the [COALITION's] Mot. to Intervene, Apr. 25, 2022, ECF No. 12 ("COALITION Br."). Plaintiffs GreenFirst Forest Products Inc. and GreenFirst Forest Products (QC) Inc. (collectively, "GreenFirst") commenced this action challenging the U.S. Department of Commerce's ("Commerce") decision not to conduct a changed circumstances review ("CCR") of Commerce's countervailing duty ("CVD") order covering softwood lumber from Canada after GreenFirst Forest Products (QC) Inc. allegedly acquired Rayonier A.M. Canada G.P.’s ("RYAM") lumber and newsprint businesses. Compl., ¶¶ 1–3, 11, Mar. 25, 2022, ECF No. 2; see also Certain Softwood Lumber Products from Canada, 82 Fed. Reg. 51,814 (Dep't Commerce Nov. 8, 2017) (Final Affirmative [CVD] Determination, and Final Neg. Determination of Critical Circumstances), Certain Softwood Lumber Products from Canada, 83 Fed. Reg. 347 (Dep't Commerce Jan. 3, 2018) (Amended Final Affirmative [CVD] Determination and [CVD] Order) ("Softwood Lumber from Canada").
The COALITION contends that it has the right to intervene because it (i) participated in the administrative proceeding at the agency level; (ii) has a legally protectable interest as the intended beneficiary of the Softwood Lumber from Canada order; (iii) has an interest "in ensuring that Commerce's CCR process is not selectively deployed by Canadian exporters and producers to manipulate their cash deposit rate"; and (iv) may lose market share if GreenFirst ultimately succeeds in this action.1 COALITION Br. at 6–7; see also CIT Rule 24(a)(2). Alternatively, the COALITION contends that it should be permitted to intervene because it shares Defendant United States’ presumed defense that Commerce properly denied GreenFirst's request for a CCR.2 Id. at 11–12; see also CIT Rule 24(b)(1)(B).
GreenFirst opposes the motion on the grounds that the COALITION's interest in this action is not direct or legally protectable because the only relief GreenFirst seeks is for Commerce to conduct a CCR. Pls.’ Opp'n to the [COALITION's] Mot. to Intervene, 2–3, Apr. 29, 2022, ECF No. 13 ("Pl. Br."). GreenFirst asserts that it is not asking the court to find that Commerce should have applied RYAM's CVD cash deposit rate to GreenFirst's entries, but only that Commerce improperly denied GreenFirst's request for a CCR. Id. at 2. Thus, according to GreenFirst, the COALITION does not have a direct interest in this action because the COALITION would only be affected if Commerce were to ultimately apply RYAM's rate to GreenFirst after conducting the CCR. Id. at 2–3. Defendant filed no response to the motion, and the COALITION asserts that Defendant "does not oppose" the motion. Mot. to Intervene at 3. For the following reasons, the COALITION's motion to intervene as a right or permissively is denied.
On November 8, 2017, Commerce issued its final determination that the Canadian government provided countervailable subsidies for certain softwood lumber products from Canada, and on January 3, 2018, Commerce issued the amended Softwood Lumber from Canada CVD order. Softwood Lumber from Canada, 83 Fed. Reg. at 347 and n.1. GreenFirst alleges that at the time Commerce initially imposed CVDs on softwood lumber from Canada, RYAM was a Canadian softwood lumber producer and exporter, and was therefore subject to the CVD order. Compl. ¶ 2. However, RYAM was not examined as a respondent, so it was subject to the "all-others rate" of 14.19%. See Softwood Lumber from Canada, 83 Fed. Reg. at 348–49. In subsequent administrative reviews of the CVD order, Commerce did not select RYAM as a respondent, but RYAM requested to be reviewed and was assigned the "non-selected companies rate." See Compl. ¶ 2; Certain Softwood Lumber Products from Canada, 85 Fed. Reg. 77,163, 77,164, 77,167 (Dep't Commerce Dec. 1, 2020) (2017 non-selected rate of 7.26%, 2018 non-selected rate of 7.42%); Certain Softwood Lumber Products from Canada, 86 Fed. Reg. 68,467 (Dep't Commerce Dec. 2, 2021) , Certain Softwood Lumber Products from Canada, 87 Fed. Reg. 1,114, 1,115, 1,117 (Dep't Commerce Jan. 10, 2022) ("Softwood Lumber from Canada 2019 Review") (non-selected rate of 6.32%); see also Certain Softwood Lumber Products from Canada, 87 Fed. Reg. 6,500, 6,502, 6,504 (Dep't Commerce Feb. 4, 2022) (non-selected rate of 6.88%).
Companies that import merchandise subject to CVD orders must pay cash deposits for entries subject to ongoing administrative reviews at the rate assigned to them during the most recently completed administrative review. See 19 U.S.C. § 1675(a) ; 19 C.F.R. § 351.212(a). As the Softwood Lumber from Canada order is currently subject to an ongoing administrative review, companies that import merchandise subject to Softwood Lumber from Canada must pay cash deposit at the rates assigned to them during the most recently completed administrative review. See Initiation of Antidumping and [CVD] Admin. Reviews, 87 Fed. Reg. 13,252, 13,259 –62 (Dep't Commerce Mar. 9, 2022) (initiating, inter alia, administrative review of Softwood Lumber from Canada for 2021); see also 19 U.S.C. § 1675(a) ; 19 C.F.R. § 351.212(a). RYAM's cash deposit rate is 6.32% based on the most recently completed administrative review. Softwood Lumber from Canada 2019 Review, 87 Fed. Reg. at 1,115 –17.
GreenFirst contends that it did not produce lumber prior to August 2021, but that it acquired RYAM's lumber and newsprint businesses on August 28, 2021. Compl. ¶¶ 2–3, 12. GreenFirst further alleges that because it acquired RYAM's entire lumber and newsprint business, including RYAM's mills, inventory, employees, customers, and vendor relationships, GreenFirst is the successor-in-interest to RYAM. Id. ¶¶ 3–4. On October 4, 2021, after allegedly acquiring RYAM's lumber and newsprint business, GreenFirst requested that Commerce conduct a CCR to determine that GreenFirst is RYAM's successor-in-interest. Id. ¶¶ 4, 13, Attach. A; see also Answer to Complaint of [COALITION], ¶¶ 4, 13, Apr. 25, 2022, ECF No. 12-1 ("Proposed Answer"). If Commerce determines that GreenFirst is RYAM's successor-in-interest, GreenFirst would be subject to RYAM's cash deposit rate of 6.32% rather than the all-others rate of 14.19% from Commerce's initial investigation. Compl. ¶ 4; Proposed Answer ¶¶ 11, 13.
However, on November 16, 2021, Commerce denied GreenFirst's request to initiate a CCR. Compl. ¶ 14, Attach. A; see also Proposed Answer ¶ 14. Commerce stated that its practice is to conduct a CCR only when there is no evidence of a significant change that could have affected the nature and extent of subsidization. Compl., Attach. A (citing Certain Pasta from Turkey, 74 Fed. Reg. 47225, 47227–28 (Dep't Commerce Sept. 15, 2009) (Prelim. Results of [CVD CCR]), unchanged in Certain Pasta From Turkey, 74 Fed. Reg. 54022 (Dep't Commerce Oct. 21, 2009) (Final Results of [CVD CCR])). Thus, Commerce will only conduct a CCR, in which it might find that "the respondent company is the same subsidized entity for CVD cash deposit purposes as the predecessor company," where there are no significant changes such as the "purchase or sales of significant productive facilities." Id. Commerce found that GreenFirst's acquisition of RYAM's lumber and newsprint businesses constituted a significant change. Id. On January 18, 2022, GreenFirst requested that Commerce reconsider its refusal to initiate a CCR. Compl. ¶ 15; Proposed Answer ¶ 15. On February 24, 2022, Commerce denied GreenFirst's request for reconsideration, again finding that a significant change had taken place, and therefore, according to its practice, determined not to conduct a CCR. Compl., ¶ 18, Attach. A; Proposed Answer ¶ 18.
On March 25, 2022, GreenFirst commenced this action, requesting that the court find Commerce's refusal to initiate a CCR to be arbitrary and capricious. Compl. ¶¶ 24, 27. The COALITION now moves to intervene as a defendant-intervenor. Mot. to Intervene at 3.
The COALITION does not have a right to intervene in this action under CIT Rule 24(a)(2). The COALITION does not have a legally protectable interest in the outcome of this action, any interest the COALITION does have in this action is not of such a direct and immediate character that the COALITION will gain or lose by the direct legal operation and effect of the judgment, and the COALITION fails to demonstrate that Defendant will not adequately represent the COALITION's interest in this action. The court also declines to permit the COALITION to intervene in this action under CIT Rule 24(b)(1)(B) because the COALITION has not demonstrated that it shares a defense with Defendant.
CIT Rule 24(a)(2) provides, in relevant part, "On a timely motion, the court must permit anyone to intervene who: ... claims an interest relating to the property or...
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