Ontario Forest Industries Asoc v. U.S.

• Decision Date: 02 August 2006
• Docket Number: Slip Op. 06-123. Ct. No. 06-00156.
• Citation: 444 F.Supp.2d 1309
• Parties: ONTARIO FOREST INDUSTRIES ASOC and Ontario Lumber Manufacturer Assoc., Plaintiffs, v. The UNITED STATES of America, and Susan C. Schwab, Defendants.
• Court: U.S. Court of International Trade

444 F.Supp.2d 1309

ONTARIO FOREST INDUSTRIES ASOC and Ontario Lumber Manufacturer Assoc., Plaintiffs, v. The UNITED STATES of America, and Susan C. Schwab, Defendants.

Slip Op. 06-123. Ct. No. 06-00156.

United States Court of International Trade.

August 2, 2006.

COPYRIGHT MATERIAL OMITTED

Baker & Hostetler, LLP (Elliot Jay Feldman, Michael Steven Snarr, Bryan Jay Brown, and John Burke), for Plaintiffs.

Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director, Jeanne E. Davidson, Deputy Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Stephen Carl Tosini, Trial Attorney), for Defendant United States.

Dewey Ballantine LLP, Washington, DC (Harry L. Clark, Kevin M. Dempsey, John W. Bohn, and David A. Bentley), for proposed Defendant-Intervenor.

OPINION

POGUE, Judge.

This case presents the questions of whether the Court of International Trade has jurisdiction to issue a writ of mandamus compelling the United States Trade Representative ("USTR") to appoint a member to an Extraordinary Challenge Committee—a reviewing authority in the North American Free Trade Agreement binational review system—and, if so, whether such a writ should be entered. Pending before the court are (1) Plaintiffs' motion for expedited consideration; (2) the Coalition for Fair Lumber Imports Executive Committee's ("Coalition") motion to intervene; (3) the Defendants' and Coalition's motions to dismiss for lack of jurisdiction and failure to state a claim; and (4) Plaintiffs' motion for judgment on the agency record.

For the reasons set forth below the court denies Plaintiffs' motion for expedited consideration; grants the Coalition's motion to intervene; grants the Defendants' and Coalition's motions to dismiss for lack of jurisdiction; and denies Plaintiffs' motion for judgment on the agency record.

BACKGROUND

Under United States trade laws, the Department of Commerce ("Commerce") is responsible for investigating whether foreign goods are being dumped into the United States or are benefitting from a countervailable subsidy. See 19 U.S.C. § 1671 (2000) et seq. If so, the International Trade Commission ("ITC") must investigate whether such dumping or subsidization causes, or threatens to cause, material injury to a U.S. industry. If Commerce finds that dumping or subsidization has occurred, and the ITC finds that dumping or subsidization causes, or threatens to cause, material injury to a domestic industry, interested parties¹ may, each year, upon the anniversary of the original findings, request an administrative review to adjust the dumping or countervailing duty in light of the importers' actual then current conduct. See 19 U.S.C. § 1675.

When goods originate from a nation that is party to the North American Free Trade Agreement ("NAFTA"), interested parties to the investigation or administrative review have two options for seeking a review or appeal of a final determination by the ITC or Commerce. Parties may elect to seek review by appealing either to a NAFTA "binational panel" or to the United States Court of International Trade. Because there are alternative avenues for appeal, the NAFTA Implementation Act provides a framework so that these two avenues of review do not collide. See, e.g., Am. Coal. for Competitive Trade v. Clinton, 128 F.3d 761, 761-63 (D.C.Cir. 1997). Specifically, the NAFTA Implementation Act both precludes the commencement of any action before the Court of International Trade within thirty days of a notice of a final determination and requires that any interested party seeking binational panel review file notice of review with the NAFTA Secretariat within thirty days of that determination. See 19 U.S.C. § 1516a (a)(5)(B); Desert Glory, Ltd. v. United States, 29 CIT ___, ___, 368 F.Supp.2d 1334, 1337 (2005); N.D. Wheat Comm'n v. United States, 28 CIT ___, ___, 342 F.Supp.2d 1319, 1321-23 (2004). See also S.Rep. No. 100-509, at 33-34 (1988), reprinted in 1988 U.S.C.C.A.N. 2395, 2428. Once a review is requested before a binational panel, no action contesting the determination in question may be brought before the Court of International Trade, 19 U.S.C. § 1516a(g)(2), except as to certain constitutional issues not at issue here, 19 U.S.C. § 1516a(g)(4)(B),² or where other statutory exceptions apply, 19 U.S.C. § 1516a(g)(3); cf. 28 U.S.C. § 1584. If no review is requested before a NAFTA binational panel, parties may seek review of the determination before the Court of International Trade so long as an action is commenced within thirty days following expiration of the stay defined in 19 U.S.C. § 1516a(a)(2)(B)(5).³

NAFTA binational panels are comprised of five members. In addition, the government of each nation that is a party to NAFTA ("NAFTA government") is required to maintain a roster of twenty-five potential panelists. See North American Free Trade Agreement, U.S.-Can.-Mex., Dec. 17, 1992, annex 1901.2(1), 32 I.L.M. 289, 687 (1993). When a panel is requested, the NAFTA governments involved in the matter ("the parties") select two panelists from each of their requisite rosters; the parties appoint the fifth panelist by agreement or, if the parties fail to agree, the parties decide by lot which of them may select from its roster the last panelist. Id. "If an involved Party fails to appoint its members to a panel within 30 days ... such panelists shall be selected by lot on the 31st ... day .. from the Party's candidates on the roster." NAFTA annex 1901.2(2), 32 I.L.M. 289, 687.

The panel applies "the general legal principles that a court of the importing Party otherwise would apply to a review of a determination of the competent investigating authority[,]" including the standard of review used by courts of that country. NAFTA Art.1904(3), 32 I.L.M. at 683; see also NAFTA annex 1911, 32 I.L.M. at 691-93. The panel is empowered to sustain or remand the determination under review, NAFTA Art.1904(2), 32 I.L.M. at 683, and its findings are binding on the participating governments with respect to the matter at issue. NAFTA art.1904(9), (11), (15), 32 I.L.M. at 683-84; 19 U.S.C. § 1516a(g)(2). See also S.Rep. No. 100-509, at 31 (1988), reprinted in 1988 U.S.C.C.A.N. 2395, 2426 ("Because binational panels act as a substitute for U.S. courts in deciding whether a determination is consistent with U.S. law, the Committee intends binational panel decisions to be implemented in the same manner that court decisions are implemented under the current law.").⁴

Upon completion of the Panel's review, the responsible NAFTA Secretary must cause to be published a "Notice of Final Panel Action" in the Federal Register. See Rules and Procedure for Article 1904 Binational Panel Reviews, 59 Fed.Reg. 8686, 8698 (Dep't Commerce Feb. 23, 1994) (North American Free Trade Agreement). Decisions of panels may only be reviewed by an Extraordinary Challenge Committee ("ECC"). NAFTA art.1904(11) & (13), 32 I.L.M. at 683; 19 U.S.C. § 1516a(g)(2); see also NAFTA annex 1904.13, 32 I.L.M. at 688. Whereas binational panels may be convened upon the request of any interested party to the agency proceedings, an ECC may convene only upon request of a NAFTA party itself, i.e., either the government of Canada, Mexico, or the United States. NAFTA art.1904(13), 32 I.L.M. at 683; NAFTA annex 1904.13, 32 I.L.M. at 688. Once convened, an ECC may only set aside a panel's findings where:

(a)(i) a member of the panel was guilty of gross misconduct, bias, or a serious conflict of interest, or otherwise materially violated the rules of conduct; (ii) the panel seriously departed from a fundamental rule of procedure, or (iii) the panel manifestly exceeded its powers, authority or jurisdiction set out in this Article, for example by failing to apply the appropriate standard of review, and (b) any of the actions set out in subparagraph (a) has materially affected that panel's decision and threatens the integrity of the binational panel review process.

NAFTA art.1904(13), 32 I.L.M. at 683.

NAFTA parties have either thirty days from the issuance of a Notice of Final Panel Action, or thirty days from the time the party discovers a violation, to request an ECC (provided that the request for an ECC is commenced within two years of the panel decision). See Rules and Procedure for Article 1904 Extraordinary Challenge Committees, 59 Fed.Reg. 8702, 8708 (Dep't Commerce Feb. 23, 1994) (North American Free Trade Agreement). NAFTA provides that the involved NAFTA governments shall establish an ECC within fifteen days of such a request. See NAFTA annex 1904.13, 32 I.L.M. at 688. Each ECC is comprised of three members. Id. Each of the involved governments selects one member for an ECC from rosters of potential ECC members each nation is required to maintain;⁵ the third and final member is selected by the party chosen by lot. Id. Following a final review by an ECC, the responsible NAFTA secretary causes to be published a "Notice of Completion of Panel Review" and the members of the panel are "discharged from their duties." Rules and Procedure for Article 1904 Binational Panel Reviews, 59 Fed. Reg. 8686, 8698 (Dep't Commerce Feb. 23, 1994) (North American Free Trade Agreement); see also Rules and Procedure for Article 1904 Extraordinary Challenge Committees, 59 Fed.Reg. 8702, 8711 (Dep't Commerce Feb. 23, 1994) (North American Free Trade Agreement).

In addition to extensive rules and timing requirements specified, see, e.g., NAFTA annex 1904.13(1), 32 I.L.M. at 688 (providing for the creation of ECCs within 15 days of a request); id. at 1904.13(2) (providing that the rules of procedure shall provide a decision of the committee within 90 days of establishment), NAFTA requires the NAFTA governments to establish rules of procedure for both panels and ECCs, NAFTA art.1904(14), 32 I.L.M. at 684; NAFTA annex 1904.13(2), 32 I.L.M. at 688; see also 19 U.S.C. § 3435. To safeguard the integrity of the binational panel system, NAFTA...