Schaeffler Grp. USA, Inc. v. United States, 2012–1269.

• Decision Date: 19 May 2015
• Docket Number: No. 2012–1269.,2012–1269.
• Citation: 786 F.3d 1354
• Parties: SCHAEFFLER GROUP USA, INC., Plaintiff–Appellant v. UNITED STATES, United States Customs and Border Protection, International Trade Commission, the Timken Company, MPB Corporation, Defendants–Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

786 F.3d 1354

SCHAEFFLER GROUP USA, INC., Plaintiff–Appellant

v.UNITED STATES, United States Customs and Border Protection, International Trade Commission, the Timken Company, MPB Corporation, Defendants–Appellees.

No. 2012–1269.

United States Court of Appeals, Federal Circuit.

May 19, 2015.

Max Fred Schutzman, Grunfeld Desiderio Lebowitz Silverman & Klestadt LLP, New York, N.Y., argued for plaintiff-appellant. Also represented by Andrew Thomas Schutz, Kavita Mohan, Washington, DC.

Martin M. Tomlinson, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for defendants-appellees United States, United States Customs and Border Protection. Also represented by Joyce R. Branda, Jeanne E. Davidson, Franklin E. White, Jr. ; Jessica Miller, Suzanna Hartzell–Ballard, Office of Assistant Chief Counsel, United States Customs and Border Protection, Indianapolis, IN.

Patrick Vincent Gallagher, Jr., Office of the General Counsel, International Trade Commission, Washington, DC, argued for defendant-appellee International Trade Commission. Also represented by Dominic L. Bianchi, Robin Lynn Turner, James M. Lyons, Neal J. Reynolds.

Terence Patrick Stewart, Stewart & Stewart, Washington, DC, argued for defendants-appellees The Timken Company, MPB Corporation. Also represented by Geert M. De Prest, Patrick John McDonough.

Before NEWMAN, O'MALLEY, and WALLACH, Circuit Judges.

Opinion

Concurring opinion filed by Circuit Judge WALLACH.

O'MALLEY, Circuit Judge.

The Continued Dumping and Subsidy Offset Act of 2000 (“CDSOA”) provided for the distribution of antidumping duties collected by the United States to “affected domestic producers” (“ADPs”) of the dumped goods. See Pub.L. No. 106–387, §§ 1001–03, 114 Stat. 1549, 1549A–72 to –75 (codified at 19 U.S.C. § 1675c (2000) ), repealed by Deficit Reduction Act of 2005, Pub.L. No. 109–171, § 7601, 120 Stat. 4, 154 (Feb. 8, 2006). Schaeffler Group USA, Inc. (“Schaeffler”) appeals from the decision of the Court of International Trade (“CIT”) dismissing Schaeffler's challenge to the constitutionality of the CDSOA under the Due Process Clause of the Fifth Amendment of the U.S. Constitution.

Schaeffler Grp. USA, Inc. v. United States, 808 F.Supp.2d 1358 (Ct. Int'l Trade 2012). Because we find that Congress had a rational basis justifying the retroactive application of the petition support requirement of the CDSOA, we affirm.

Background

I

Much of the background regarding how the CDSOA applies to producers of dumped goods has been explained in detail in SKF USA, Inc. v. U.S. Customs & Border Protection, 556 F.3d 1337 (Fed.Cir.2009) (“SKF ”). As in SKF , this appeal involves the petition support requirement of the now-repealed CDSOA. In an antidumping investigation, the International Trade Commission (“ITC”) must determine if the dumping of certain imports has materially injured or threatened material injury to the domestic industry. 19 U.S.C. § 1673 (2012). To assess material injury, the ITC sends questionnaires to foreign producers and exporters, as well as members of the domestic industry, seeking production and financial data. SKF, 556 F.3d at 1341. These questionnaires include a specific question asking the respondent to indicate whether they support, oppose, or take no position on the petition. Id. Relying on the information provided in these questionnaires, the ITC and the Department of Commerce (“Commerce”) make final determinations that potentially lead to the imposition of an antidumping order. Id. The antidumping order imposes a duty on imported merchandise “in an amount equal to the amount by which the normal value exceeds the export price (or the constructed export price) for the merchandise,” and the United States Customs and Border Protection (“Customs”) agency collects these duties. 19 U.S.C. § 1673.

Under the CDSOA, rather than keep the collected duties in the United States Treasury, Customs distributed the duties to eligible ADPs within the particular domestic industry at issue. 19 U.S.C. § 1675c(a),(e) (2000), repealed by Pub.L. No. 109–171, § 7601, 120 Stat. at 154. Only members of the domestic industry that qualified as ADPs were eligible to receive the CDSOA distributions. Id. § 1675c(b)(1). The CDSOA defined “affected domestic producer” as:

[A]ny manufacturer, producer, farmer, rancher or worker representative (including associations of such persons) that—(A) was a petitioner or interested party in support of the petition with respect to which an antidumping duty order, a finding under the Antidumping Act of 1921, or a countervailing duty order has been entered, and (B) remains in operation.

Id. (emphasis added) (“petition support provision”). The CDSOA required the ITC to provide Customs with a list of all “petitioners and ... persons” that indicated support for all antidumping orders in effect as of January 1, 1999. Id. § 1675c(d)(1). The CDSOA also required the ITC to provide Customs with the names of any petitioners that indicated support for antidumping orders issued after enactment of the CDSOA. Id. Customs then published annual lists of ADPs, including instructions for how eligible ADPs could make a claim for CDSOA distributions. SKF , 556 F.3d at 1345. Producers who were not on Customs' annual list of ADPs could still seek CDSOA distributions, and Customs retained discretion over approval of such requests. The CDSOA applied to all antidumping and countervailing duties assessed and collected on entries between October 1, 2000, and October 1, 2007, when Congress repealed the CDSOA. Deficit Reduction Act of 2005, Pub.L. No. 109–171, § 7601, 120 Stat. at 154. Importantly, the repeal of the CDSOA was not retroactive—Congress stated that “[a]ll duties on entries of goods made and filed before October 1, 2007 ... shall be distributed as if [the CDSOA] had not been repealed.” Id. § 7601(b).

II

Commerce initiated an antidumping investigation on antifriction bearings and parts thereof from the Federal Republic of Germany, France, Italy, Japan, Romania, Singapore, Sweden, Thailand, and the United Kingdom on April 27, 1988. Antifriction Bearings (Other than Tapered Roller Bearings) and Parts Thereof from France: Initiation of Antidumping Duty Investigation, 53 Fed.Reg. 15,074 (Apr. 27, 1988). The ITC instituted a material injury investigation on April 11, 1988. Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From the Federal Republic of Germany, France, Italy, Japan, Romania, Singapore, Sweden, Thailand, and the United Kingdom, 53 Fed.Reg. 11,917 (Apr. 11, 1988). Schaeffler's predecessor corporate entities INA USA Corp. (“INA”) and FAG Bearings Corp. (“FAG”) participated in the investigations, but did not support the petition for any countries involved. The ITC eventually found a material injury to domestic industry, Views of the Commission, Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof from the Federal Republic of Germany, France, Italy, Japan, Romania, Singapore, Sweden, Thailand, and the United Kingdom, USITC Pub. 2185 (May 1989), and Commerce instituted antidumping orders against certain classes of the relevant merchandise, Antidumping Duty Orders: Ball Bearings, Cylindrical Roller Bearings, and Spherical Plain Bearings and Parts Thereof From the Federal Republic of Germany, 54 Fed.Reg. 20,900 –11 (May 15, 1989).

The initial ITC list of qualifying ADPs sent to Customs included the antifriction bearings antidumping order issued on May 15, 1989. Customs then published its first notice of intent to distribute CDSOA funds on August 3, 2001. Distribution of Continued Dumping and Subsidy Offset to Affected Domestic Producers, 66 Fed.Reg. 40,782, 40,788, 40,796 (Aug. 3, 2001). Schaeffler, INA, and FAG were not identified as eligible ADPs on either the ITC list or Customs notice because INA and FAG failed to indicate their support for the petition in the questionnaires they submitted during the ITC's material injury investigation. Schaeffler also did not appear as an ADP on any of the later notices of intent issued by Customs.

Schaeffler filed a written request with the ITC on May 4, 2007, seeking to be included as an ADP. Before receiving a response from the ITC, Schaeffler also filed a certification request with Customs on July 30, 2007, this time seeking a CDSOA distribution for fiscal year 2007. The ITC denied Schaeffler's request on August 2, 2007, and Customs denied Schaeffler's request on September 28, 2007. Schaeffler again petitioned Customs for CDSOA distributions for fiscal years 2008 and 2009, and Customs denied both requests.

Schaeffler also filed a series of complaints in the CIT between 2006 and 2009 seeking review of the determinations of the ITC and Customs, as well as challenging the constitutionality of the CDSOA. Schaeffler Grp., 808 F.Supp.2d at 1359–60. The court stayed Schaeffler's complaints pending resolution of the constitutional issues raised in Pat Huval Restaurant & Oyster Bar, Inc. v. United States. Schaeffler Grp., 808 F.Supp.2d at 1359–60. After we issued our decisions in SKF and P.S. Chez Sidney v. U.S. International Trade Commission, 409 Fed.Appx. 327 (Fed.Cir.2010), upholding the constitutionality of the CDSOA against First Amendment and equal protection challenges, the CIT consolidated Schaeffler's complaints. The ITC and intervenors Timken Company and MPB Corporation (“Timken”) then moved to dismiss the complaints and sought judgment on the pleadings. Schaeffler Grp., 808 F.Supp.2d at 1359–60.

Schaeffler challenged the petition support requirement of the CDSOA under three provisions of the Constitution: (1) the free speech clause of the First Amendment as applied against Schaeffler; (2) the equal protection guarantees of the Due Process Clause of the Fifth Amendment as applied against Schaeffler; and (3) the substantive guarantees of the Due Process Clause of the Fifth Amendment. Id. at 1361. The CIT first held that Schaeffler failed to plead facts...