United States Court of Appeals for the Federal Circuit
2006-1386
PARKDALE INTERNATIONAL,
Plaintiff-Appellant,
and
RUSSELL METALS EXPORT,
Plaintiff,
v.
UNITED STATES,
Defendant-Appellee,
and
UNITED STATES STEEL CORPORATION,
Defendant-Appellee.
Richard P. Ferrin, Hunton & Williams LLP, of Washington, DC, argued for
plaintiff-appellant. With him on the brief was William Silverman.
David S. Silverbrand,Trial Attorney, Commercial Litigation Branch, Civil Division,
United States Department of Justice, of Washington, DC, argued for defendant-appellee
United States. With him on the brief were David M. Cohen, Director, and Patricia M.
McCarthy, Assistant Director. Of counsel on the brief were John D. McInerney, Chief
Counsel; Berniece A. Browne, Senior Counsel; and Kemba T. Eneas, Attorney, Office of
the Chief Counsel for Import Administration, United States Department of Commerce, of
Washington, DC.
Jeffrey D. Gerrish, Skadden, Arps, Slate, Meagher & Flom, LLP, of Washington,
DC, argued for defendant-appellee United States Steel Corporation. With him on the
brief were John J. Mangan and Robert E. Lighthizer.
Appealed from: United States Court of International Trade
Judge Judith M. Barzilay
UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT
2006-1386
PARKDALE INTERNATIONAL,
Plaintiff-Appellant,
and
RUSSELL METALS EXPORT,
Plaintiff,
v.
UNITED STATES,
Defendant-Appellee,
and
UNITED STATES STEEL CORPORATION,
Defendant-Appellee.
______________________
DECIDED: February 9, 2007
_______________________
Before MAYER, RADER and GAJARSA, Circuit Judges.
MAYER, Circuit Judge.
Parkdale International (“Parkdale”) appeals the judgment of the United States
Court of International Trade denying its motion for summary judgment on the agency
record.∗ Parkdale Int’l v. United States, 429 F. Supp. 2d 1324 (Ct. Int’l Trade 2006).
Because the Department of Commerce’s (“Commerce”) application of its May 6, 2003,
reseller policy to Parkdale’s subject entries during the Period of Review (“POR”), August
1, 2002 to July 31, 2003, does not have an impermissibly retroactive effect, we affirm.
Background
Parkdale is a reseller, importer, and exporter of corrosion-resistant carbon steel
products (“CORE”) from Canada to the United States. Commerce first published an
antidumping duty order on CORE from Canada in 1993. Antidumping Duty Orders:
Certain Corrosion-Resistant Carbon Steel Flat Products from Canada, 58 Fed. Reg.
44,162 (Aug. 19, 1993). Consequently, subject CORE may enter the United States only
if accompanied by a cash deposit of the estimated dumping duties. See 19 U.S.C.
§ 1673e(a)(3). While liability to pay dumping duties accrues upon entry of subject
merchandise, see 19 C.F.R. § 141.1(a), the actual duty is not formally determined until
after entry, and not paid until the goods are liquidated by the Bureau of Customs and
Border Protection (“Customs”), see, e.g., Bethlehem Steel Corp. v. United States, 27 F.
Supp. 2d 201, 207 (Ct. Int’l Trade 1998) (“Given the retrospective nature of Commerce's
administrative reviews, an exporter can not expect to predict exactly its potential
antidumping duty liability at the time of import into the United States.”).
On August 1, 2003, Commerce provided an opportunity for interested parties to
request an administrative review of producers, resellers, and importers of subject CORE
for the POR between August 1, 2002 and July 31, 2003. Antidumping or Countervailing
Duty, Order, Finding, or Suspended Investigation; Opportunity to Request
∗
Russell Metals Export was a plaintiff in the proceeding before the Court of
International Trade, but did not file a notice of appeal here.
2006-1386 2
Administrative Review, 68 Fed. Reg. 45,218 (Aug. 1, 2003). Several parties requested
a review, but Parkdale chose not to participate. Commerce issued its preliminary
results in September 2004, Certain Corrosion-Resistant Carbon Steel Flat Products
from Canada: Preliminary Results of Antidumping Administrative Review, 69 Fed. Reg.
55,138 (Sept. 13, 2004), which Parkdale challenged as an interested party. Commerce
rejected Parkdale’s challenge, and issued its final results in March 2005. Certain
Corrosion-Resistant Carbon Steel Flat Products from Canada: Final Results of
Antidumping Administrative Review, 70 Fed. Reg. 13,458 (Mar. 21, 2005), as amended
70 Fed. Reg. 22,846 (May 3, 2005) (“Final Results”). There, Commerce provided that
its May 6, 2003, reseller policy would apply to unreviewed resellers, like Parkdale, who
purchased their CORE from a reviewed producer who did not know its goods were
destined for the United States. See Final Results, 70 Fed. Reg. at 13,459; see also
Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties,
68 Fed. Reg. 23,954 (May 6, 2003) (“Reseller Policy”). As a result, Parkdale’s subject
goods entered during the POR are set to be liquidated at the “all-others” rate (i.e., a
simple average of the calculated company-specific dumping rates), not the producer-
specific cash deposit rate that it paid upon entry of its goods (i.e., CORE producer
Stelco, Inc.’s, dumping margin). The all-others rate is considerably higher than
Parkdale’s producer-specific cash deposit rate, 18.71% as compared to 4.24%.
Commerce initially proposed the Reseller Policy in 1998, for the purpose of
clarifying how it applied the automatic liquidation provisions under 19 C.F.R. § 351.212
to resellers exporting subject merchandise to the United States. Antidumping and
Countervailing Duty Proceedings: Assessment of Antidumping Duties, 63 Fed. Reg.
2006-1386 3
55,361 (Oct. 15, 1998). The October 1998, notice provided that if “the Department
determines in the administrative review that the producer did not know that the
merchandise it sold to the reseller was destined for the United States, the reseller's
merchandise will not be liquidated at the assessment rate the Department determines
for the producer or automatically at the rate required as a deposit at the time of entry. In
that situation, the entries of merchandise from the reseller during the period of review
will be liquidated at the all-others rate if there was no company-specific review of the
reseller for that review period.” Id. at 55,362.
Commerce subsequently requested additional comments on its proposal.
Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties,
67 Fed. Reg. 13,361 (Mar. 25, 2002). Parkdale responded in April 2002, stating that,
“until issuance of that March 25, 2002 notice, Canadian resellers had every reason to
believe, at the time of importation, that their imports were subject to the existing
practice, which has been either to apply automatic liquidation to all reseller entries, or to
liquidate at the relevant manufacturers’ rate, not to apply the ‘all others’ rate as a
possible alternative rate depending on what the manufacturer did or did not know.”
Parkdale’s comments notwithstanding, Commerce adopted the Reseller Policy on May
6, 2003, substantially as proposed in October 1998. In other words, prior to
Commerce’s adoption of the Reseller Policy, if Parkdale did not participate in an
administrative review, its entries were liquidated at Stelco, Inc.’s (“Stelco”), cash deposit
rate, regardless of whether an administrative review had been requested for Stelco.
With the adoption of the new policy, however, because Stelco requested an
2006-1386 4
administrative review for the 2002-03 POR, Parkdale’s decision not to undergo a review
guaranteed that it would be subject to the higher all-others rate.
While Commerce initially characterized the Reseller Policy as a mere
“clarification,” it acknowledges that the policy gives rise to a “relatively significant
change” for affected parties. Parkdale, 429 F. Supp. 2d at 1333 (“Commerce concedes
that . . . there was a relatively significant change in [its] treatment of resellers.”).
However, the policy’s impact is circumscribed because it only applies “to entries for
which the anniversary month for requesting an administrative review is May 2003 or
later.” Reseller Policy, 68 Fed. Reg. at 23,956. Accordingly, any reseller potentially
affected by the policy had notice of its impact prior to having to make the decision
whether to participate in a subsequent administrative review, and thereby have its
goods liquidated at a rate calculated specifically for it; or not to participate, and have its
entries liquidated at the all-others rate.
After Commerce issued its Final Results, Parkdale filed suit in the Court of
International Trade, arguing that application of the Reseller Policy to its subject goods
entered prior to May 6, 2003, had an impermissibly retroactive effect. The trial court
denied its challenge, and Parkdale appeals. We have jurisdiction under 28 U.S.C.
§ 1295(a)(5).
Discussion
“We review the Court of International Trade’s judgment, affirming or reversing
the final results of an administrative review, de novo. In so doing, we apply anew the
same standard used by the court, and will uphold Commerce’s determination unless it is
unsupported by substantial evidence on the record, or otherwise not in accordance with
2006-1386 5
law.” Hynix Semiconductor, Inc. v. United States, 424 F.3d 1363, 1367-68 (Fed. Cir.
2005) (citations and quotation marks omitted). “While we essentially step into the shoes
of the Court of International Trade and duplicate its review, . . . we do not altogether
ignore its informed opinion.” Royal Thai Gov’t v. United States, 436 F.3d 1330, 1335
(Fed. Cir. 2006) (citations omitted).
Parkdale contends that Commerce’s application of its reseller policy to subject
merchandise entered prior to its promulgation on May 6, 2003, is impermissibly
retroactive. We disagree.
It is true that “[r]etroactivity is not favored in the law.” Bowen v. Georgetown
Univ. Hosp., 488 U.S. 204, 208 (1988). However, a statute, rule, or policy “does not
operate ‘retrospectively’ merely because it is applied in a case arising from conduct
antedating the statute's enactment, or upsets expectations based in prior law. Rather,
the court must ask whether the new provision attaches new legal consequences to
events completed before its enactment.” Landgraf v. USI Film Prods., 511 U.S. 244,
269-70 (1994) (citations omitted) (emphasis added). To determine whether the
application of a law or policy is impermissibly retroactive, we examine the “nature and
extent of the change of the law,” “the degree of connection between the operation of the
new rule and a relevant past event,” and “considerations of fair notice, reasonable
reliance, and settled expectations.” Princess Cruises, Inc. v. United States, 397 F.3d
1358, 1364 (Fed. Cir. 2005) (quoting Landgraf, 511 U.S. at 270).
The government concedes that Commerce’s Reseller Policy constitutes a
relatively significant change. Prior to its adoption, Commerce liquidated subject goods
for resellers like Parkdale at the relevant producer-specific cash deposit rate, unless the
2006-1386 6
reseller or another interested party requested an administrative review of the reseller’s
entries. Under the Reseller Policy, however, because Stelco participated in the
administrative review for the 2002-03 POR, Parkdale lost its ability to have its entries
liquidated at Stelco’s cash deposit rate. While this factor points in Parkdale’s favor, the
remaining two Landgraf factors align heavily against it, and preclude our finding
impermissible retroactivity.
A retroactive rule “must also have a significant retroactive connection with past
events.” Princess Cruises, 397 F.3d at 1366. Parkdale argues that because resellers
do not have the option of undoing importations entered before May 6, 2003, the
connection between those entries of goods and the new rule is significant. We do not
agree. Although the new policy affects Parkdale’s ultimate liability, the degree of
connection between the policy and Parkdale’s subject entries is minimal.
Parkdale’s decisions relating to the volume of CORE it imports in a given year
are certainly dependant, at least in part, on what dumping rate it anticipates will
ultimately be assessed against it. However, resellers import goods with the knowledge
that changes may occur to duty margins until liquidation of subject entries. See 19
U.S.C. § 1500; Dart Exp. Corp. v. United States, 43 C.C.P.A. 64, 76 (1956); see also
Bethlehem Steel, 27 F. Supp. 2d at 207; D & L Supply Co. v. United States, 841 F.
Supp. 1312, 1315 (Ct. Int’l Trade 1993) (“The uncertainty of knowing the final amount of
duties due at the time of entry is simply an inherent part of importing merchandise into
the United States.”). Indeed, “[n]o vested right to a particular classification or rate of
duty or preference is acquired at the time of importation.” N. Am. Foreign Trading
Corp. v. United States, 783 F.2d 1031, 1032 (Fed. Cir. 1986) (citing Norwegian
2006-1386 7
Nitrogen Prods. Co. v. United States, 288 U.S. 294, 318, (1932)). This stems from the
fact that “the United States uses a ‘retrospective’ assessment system under which final
liability for antidumping and countervailing duties is determined after merchandise is
imported.” 19 C.F.R. § 351.212(a). While importers entering merchandise subject to an
antidumping duty order are required to make a cash deposit of estimated antidumping
duties, this rate is not final where an administrative review is initiated. Accordingly, in
cases involving importers’ challenges to the application of new laws based on
retroactivity, we have looked at liquidation as the paramount relevant “past event.” See,
e.g., Travenol Labs., Inc. v. United States, 118 F.3d 749, 753 (Fed. Cir. 1997) (holding
that liquidation of entries “is the triggering or operative event” for deciding whether
application of a statute or regulation is impermissibly retroactive); see also Syva Co. v.
United States, 681 F. Supp. 885, 890 (Ct. Int’l Trade 1988) (stating that “the statute
merely prescribes the time for payment of duties once the entries are liquidated, and
since liquidation, the operative event triggering the time for assessment of interest,
occurred after the statute was enacted, there is no retroactive application which would
deprive plaintiff of any vested substantive right”).
Viewing liquidation, or commencement of the administrative review, as the proper
“triggering event,” as opposed to entry of subject goods, is particularly appropriate here
because but for Stelco’s participation in the challenged administrative review, the
Reseller Policy would not have precluded Parkdale from having its goods liquidated at
Stelco’s duty margin. Accordingly, because the significance of the Reseller Policy to
entries pre-dating it is minimal, and the primary effect of the policy is prospective, i.e., it
applies to liquidations post-dating its adoption, we conclude that its effect cannot
2006-1386 8
properly be considered impermissibly retroactive. To the extent that weighing the first
two Landgraf factors nonetheless permits of uncertainty in this holding, considerations
of fair notice, reasonable reliance, and settled expectations remove any doubt.
As discussed above, an importer’s duty is not fixed until liquidation. Therefore,
despite the fact that Parkdale enjoyed liquidation at Stelco’s dumping margin for several
years, it, nevertheless, could not have an objectively reasonable settled expectation that
it would not, at some point, be subjected to a different margin. This is especially so
because an overriding purpose of Commerce’s administration of antidumping laws is to
calculate dumping margins as accurately as possible, and this requires altering dumping
rates to reflect changes in, inter alia, policy or commercial realities. See, e.g., Rhone
Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed. Cir. 1990). Moreover, since
1998, Parkdale was on notice that Commerce might adopt the Reseller Policy. In view
of the additional notice Commerce provided in 2002 and the comments Parkdale
submitted in response, it undoubtedly had fair notice of the change. Finally, after its
comments in April 2002, because Parkdale could reasonably anticipate that adoption of
the Reseller Policy was imminent, it ceased to have a credible claim to reasonable
reliance on the assumption that Commerce would nevertheless continue to apply its
previous reseller policy in future administrative reviews.
Conclusion
Accordingly, the judgment of the United States Court of International Trade is
affirmed.
AFFIRMED
2006-1386 9