Schaeffler Grp. USA, Inc. v. United States

• Decision Date: 17 January 2012
• Docket Number: Slip Op. 12–8.Court No. 06–00432.
• Citation: 808 F.Supp.2d 1358,34 ITRD 1085
• Parties: SCHAEFFLER GROUP USA, INC., Plaintiff, v. UNITED STATES, United States Customs and Border Protection, and United States International Trade Commission, Defendants,andThe Timken Company and MPB Corporation, Defendant Intervenors.
• Court: U.S. Court of International Trade

34 ITRD 1085

808 F.Supp.2d 1358

SCHAEFFLER GROUP USA, INC., Plaintiff,

v.UNITED STATES, United States Customs and Border Protection, and United States International Trade Commission, Defendants,andThe Timken Company and MPB Corporation, Defendant Intervenors.

Slip Op. 12–8.Court No. 06–00432.

United States Court of International Trade.

Jan. 17, 2012.

Max F. Schutzman, and Andrew T. Schutz, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt, LLP, of New York, NY, for plaintiff.

David S. Silverbrand, and Courtney S. McNamara, Trial Attorneys, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, for defendant United States Customs and Border Protection. With them on the briefs were Tony West, Assistant Attorney General, Jeanne E. Davidson, Director, Franklin E. White, Jr., Assistant Director, and Andrew G. Jones, Office of Assistant Chief Counsel, United States Customs and Border Protection, of counsel.

Patrick V. Gallagher, Jr., Attorney Advisor, Office of the General Counsel, U.S. International Trade Commission, of Washington, DC, for defendant, U.S. International Trade Commission. With him on the briefs were James M. Lyons, General Counsel, and Neal J. Reynolds, Assistant General Counsel for Litigation.Geert De Prest, Stewart and Stewart, of Washington, DC, for defendant intervenors. With him on the brief were Terence P. Stewart, Amy S. Dwyer, and Patrick J. McDonough.Before: GREGORY W. CARMAN, Judge, TIMOTHY C. STANCEU, Judge, LEO M. GORDON, Judge.

OPINION

CARMAN, Judge:

Plaintiff brought five cases ¹ challenging the constitutionality of the Continued Dumping and Subsidy Offset Act of 2000 (“CDSOA” or “Byrd Amendment”).² These cases were consolidated by order of the Court under Consol. Ct. No. 06–00432. (Order (Feb. 15, 2011), ECF No. 37.) Plaintiff claims that it unlawfully was denied affected domestic producer (“ADP”) status, which would have qualified it to receive distributions under the CDSOA. The consolidated case is now before the Court on dispositive motions. Defendants United States Customs and Border Protection (“CBP”) and the United States International Trade Commission (“ITC”) each move to dismiss Plaintiff's complaints for failure to state a claim upon which relief can be granted pursuant to USCIT Rule 12(b)(5), and for judgment on the pleadings under USCIT R. 12(c). (Defs. The United States and United States Customs and Border Protection's Mot. to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted and for Judgment on the Pleadings (“CBP Mot.”), May 4, 2011, ECF No. 60); (Def. United States International Trade Commission's Mot. to Dismiss for Failure to State a Claim and For Judgment on the Pleadings (“ITC Mot.”), May 2, 2011, ECF No. 56). Defendant Intervenors the Timken Company and MPB Corp. (collectively, “Timken”) move for judgment on the pleadings pursuant to USCIT Rule 12(c). (Timken's Mot. for J. on the Pleadings (“Timken Mot.”), May 2, 2011, ECF No. 58.) Plaintiff also cross moved for judgment on the pleadings. (Pl.'s Cross Mot. for J. on the Pleadings (“Pl.'s Mot.”), June 6, 2011, ECF No. 62.) For the reasons set forth below, Plaintiff's consolidated action will be dismissed for failure to state a claim upon which relief can be granted.

Background

Plaintiff Schaeffler Group USA, Inc. (“Schaeffler”), a U.S. producer of antifriction bearings, is the legal successor to two U.S. producers of antifriction bearings ³ who participated in a 1988 investigation conducted by the ITC that culminated in the issuance of antidumping duty orders on antifriction bearings and parts thereof from Germany, France, Italy, Japan, Sweden, Romania, Thailand, Singapore, and the United Kingdom. ( See Compl. 1 ¶¶ 1, 7.) During those proceedings, Schaeffler responded to the ITC's questionnaires but declined to indicate to the ITC that it supported the antidumping petition. ( Id. at ¶ 10.) Consequently, the ITC has never included Schaeffler on a published list of ADPs, and, as a result, Schaeffler has never received a CDSOA distribution. (Compl. 1 ¶ 36; Compl. 2 ¶ 36; Compl. 3 ¶¶ 39, 42; Compl. 4 ¶ 39; Compl. 5 ¶ 39.)

Plaintiff brought a series of cases to challenge the government's refusal to provide it CDSOA distributions for fiscal years 2004 through 2009. (Compls. 15, Prayer for Relief.) Shortly after each of Schaeffler's cases was filed, the Court stayed the actions pending final resolution of other litigation raising the same or similar issues.⁴ Following the decision of the U.S. Court of Appeals for the Federal Circuit in SKF USA Inc. v. U.S. Customs and Border Protection, 556 F.3d 1337 (2009) (“ SKF USA II ”), the Court ordered Plaintiff to show cause why its cases should not be dismissed. (Order (Jan. 3, 2011), ECF No. 31.) After Plaintiff responded to the Court's order, the Court lifted the stay in each of Plaintiff's cases for all purposes. (Order (Feb. 9, 2011), ECF No. 34.) The Court then consolidated Plaintiff's five cases under Consol. Ct. No. 06–00432. (Order (Feb. 15, 2011)).⁵

Jurisdiction

The Court exercises subject matter jurisdiction over this action pursuant to section 201 of the Customs Courts Act of 1980, 28 U.S.C. § 1581(i)(4), which grants the Court of International Trade exclusive jurisdiction of any civil action commenced against the United States that arises out of any law providing for administration and enforcement with respect to, inter alia, the matters referred to in § 1581(i)(2), which are “tariffs, duties, fees, or other taxes on the importation of merchandise for reasons other than the raising of revenue.” The CDSOA, under which this action arises, is such a law. See Furniture Brands Int'l, Inc. v. United States, 35 CIT ––––, –––– – ––––, 807 F.Supp.2d 1301, 1307–10.

Discussion

The CDSOA amended the Tariff Act of 1930 to provide for an annual distribution (a “continuing dumping and subsidy offset”) of duties assessed pursuant to an antidumping duty or countervailing duty order to affected domestic producers as reimbursements for qualifying expenditures.⁶ 19 U.S.C. § 1675c(a), (d). ADP status is limited to petitioners, and interested parties in support of petitions, with respect to which antidumping duty and countervailing duty orders are entered, and who remain in operation. Id. § 1675c(b)(1). The CDSOA directed the ITC to forward to Customs, within sixty days after an antidumping or countervailing duty order is issued, lists of persons with ADP status, i.e., “petitioners and persons with respect to each order and finding and a list of persons that indicate support of the petition by letter or through questionnaire response.” Id. § 1675c(d)(1). The CDSOA also provided for distributions of antidumping and countervailing duties assessed pursuant to existing antidumping duty and countervailing duty orders and for this purpose directed the ITC to forward to CBP a list identifying ADPs “within 60 days after the effective date of this section in the case of orders or findings in effect on January 1, 1999 or thereafter....” Id. The CDSOA directed CBP to publish in the Federal Register, prior to each distribution, lists of ADPs potentially eligible for distributions based on the lists obtained from the ITC, id. § 1675c(d)(2), and to distribute annually all funds, including accrued interest, from antidumping and countervailing duties received in the preceding fiscal year. Id. § 1675c(d)(3), (e).

The Court of Appeals, in SKF USA II, upheld the CDSOA against constitutional challenges brought on First Amendment and equal protection grounds. 556 F.3d at 1360 (“[T]he Byrd Amendment is within the constitutional power of Congress to enact, furthers the government's substantial interest in enforcing the trade laws, and is not overly broad. We hold that the Byrd Amendment is valid under the First Amendment.”); id. (“Because it serves a substantial government interest, the Byrd Amendment is also clearly not violative of equal protection under the rational basis standard.”).⁷

Plaintiff challenges the constitutionality of Defendants' application of the CDSOA to Schaeffler on three grounds. In Count One, Plaintiff challenges the “in support of the petition” requirement of the CDSOA (“petition support requirement”), as applied, on First Amendment grounds. (Compl. 1 ¶¶ 41–43, Compl. 2 ¶¶ 41–43, Compl. 3 ¶¶ 44–46, Compl. 4 ¶¶ 41–43, Compl. 5 ¶¶ 41–43.) In Count Two, Plaintiff challenges the petition support requirement, as applied, on Fifth Amendment Equal Protection grounds. (Compl. 1 ¶¶ 44 47, Compl. 2 ¶¶ 44–47, Compl. 3 ¶¶ 47–50, Compl. 4 ¶¶ 44–47, Compl. 5 ¶¶ 44–47.) In Count Three, Plaintiff claims that the petition support requirement violates the Fifth Amendment Due Process guarantee, in basing Schaeffler's eligibility for disbursements on past conduct, i.e., support for a petition. (Compl. 1 ¶¶ 48–50, Compl. 2 ¶¶ 48–50, Compl. 3 ¶¶ 51–53, Compl. 4 ¶¶ 48–50, Compl. 5 ¶¶ 48–50.)

In ruling on motions to dismiss made under USCIT Rule 12(b)(5), we dismiss complaints that do not “contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). For the reasons set forth below, we conclude that each of the claims in Plaintiff's complaints in this consolidated action must be dismissed for failure to state a claim upon which relief can be granted.

I. Plaintiff's Challenges Under the First Amendment and the Equal Protection Clause Are Foreclosed by Binding Precedent

Plaintiff fails to plead facts allowing the Court to conclude that its as applied First Amendment and Equal Protection challenges to the CDSOA are distinguishable from claims brought, and rejected, in SKF USA II. The complaints contain no assertions that the CDSOA was applied to Schaeffler in a different manner than the statute was...