American Pacific Plywood Inc. v. United States

Slip Op. No. 21-28
UNITED STATES COURT OF INTERNATIONAL TRADE
AMERICAN PACIFIC PLYWOOD, INC.,
et al.,
Plaintiffs,
v.
UNITED STATES,
Defendant,
and
COALITION FOR FAIR TRADE IN
HARDWOOD PLYWOOD,
Defendant-Intervenor.
Consol. Court No. 20-03914
OPINION AND ORDER
[Denying plaintiffs’ motions for reassignment of their respective actions, now
consolidated, to a three-judge panel]
Dated: March 5, 2021
Gregory S. Menegaz, deKieffer & Horgan, PLLC, of Washington, D.C., for
plaintiffs American Pacific Plywood, Inc., U.S. Global Forest, Inc., Interglobal Forest,
LLC, and plaintiff-intervenors LB Wood Cambodia Co., Ltd. and Cambodian Happy
Home Wood Products Co., Ltd. With him on the brief were Alexandra H. Salzman and
James K. Horgan.
Timothy C. Brightbill, Wiley Rein, LLP, of Washington, D.C., for defendant-
intervenor. With him on the brief were Elizabeth S. Lee, John Allen Riggins, Stephanie M.
Bell, Tessa V. Capeloto, and Maureen E. Thorson.
Brian M. Boynton, Acting Assistant Attorney General, Civil Division, U.S.
Department of Justice, Commercial Litigation Branch, New York, New York, for
defendant. With him on the brief were Jeanne E. Davidson, Director, Justin R. Miller,
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Attorney-in-Charge, Claudia Burke, Assistant Director, and Hardeep K. Josan, Trial
Attorney.
Stanceu, Chief Judge: Three plaintiffs in this consolidated action—American
Pacific Plywood, Inc., U.S. Global Forest, Inc., and Interglobal Forest, LLC—have filed
motions under 28 U.S.C. §§ 253(c) and 255(a) that seek reassignment of each of their
respective actions to a three-judge panel. Pl.’s Mot. for a Three-Judge Panel (Ct. No.
20-03914) (Feb. 3, 2021), ECF No. 21 (“Pl.’s Mot.”); Pl.’s Mot. for a Three-Judge Panel (Ct.
No. 20-03915) (Feb. 3, 2021), ECF No. 22; Pl.’s Mot. for a Three-Judge Panel (Ct. No.
20-03916) (Feb. 3, 2021), ECF No. 21.1 For the reasons discussed below, the court denies
plaintiffs’ motions.
I. BACKGROUND
These actions arose following investigations U.S. Customs and Border Protection
(“Customs” or “CBP”) conducted under the Enforce and Protect Act, 19 U.S.C. § 1517
(“EAPA”), into claims that certain imports of hardwood plywood occurred due to
evasion of antidumping and countervailing duty orders on hardwood plywood from
the People’s Republic of China. Pl.’s Mot. 2; see Certain Hardwood Plywood Products from
1 Citations herein are to the amended complaint, motion for reassignment, and
defendant’s response in American Pacific Plywood, Inc. v. United States, as the filings do
not vary materially across the three cases with respect to the issues raised by the
motions for reassignment. Prior to consolidation, the three individual actions were
assigned to Judge M. Miller Baker. Now consolidated under Consolidated Court No.
20-03914 are American Pacific Plywood, Inc. v. United States, Court No. 20-03914, U.S.
Global Forest v. United States, Court No. 20-03915, and InterGlobal Forest LLC v. United
States, Court No. 20-03916. Order (Feb. 25, 2021), ECF No. 29.
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the People’s Republic of China: Amended Final Determination of Sales at Less than Fair Value,
and Antidumping Duty Order, 83 Fed. Reg. 504 (Dep’t of Commerce Jan. 4, 2018) (“AD
order”), Certain Hardwood Plywood Products from the People’s Republic of China:
Countervailing Duty Order, 83 Fed. Reg. 513 (Dep’t of Commerce Jan. 4, 2018) (“CVD
order”). Plaintiffs challenge CBP’s initiation of the EAPA investigations, its institution
of “interim measures” during the investigations, the final determinations by Customs
that evasion of the AD and CVD orders occurred, and the affirming of those
determinations by Customs upon administrative appeal. Am. Compl. ¶ 9 (Jan. 7, 2021),
ECF No. 7.
Defendant takes no position on plaintiffs’ motions for reassignment to a three-
judge panel. Def.’s Resp. to Pl.’s Mot. for a Three-Judge Panel 3 (Feb. 24, 2021), ECF
No. 27.
II. DISCUSSION
Plaintiffs seek reassignment to a three-judge panel on two independent grounds.
First, they argue that each of the consolidated actions “raises an issue of the
constitutionality of an act of Congress,” Pl.’s Mot. 1 (quoting 28 U.S.C. § 255(a)(1)).
Second, plaintiffs argue that each “has broad or significant implications in the
administration or interpretation of the customs laws.” Id. (quoting 28 U.S.C.
§ 255(a)(2)). Rejecting plaintiffs’ arguments on both grounds, the court declines to
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reassign this action from a single judge to a three-judge panel. In so doing, the court
expresses no view on the merits of the claims in this litigation.
Plaintiffs’ amended complaints contain eleven to twelve counts, only one of
which, designated as Count IX in each complaint, contains a reference to a
constitutional challenge to an act of Congress. The claim in Count IX is stated as
follows: “Insofar as the EAPA statute, and in particular 19 U.S.C. § 1517(e) (Interim
measures) cannot be properly interpreted to afford importers due process under the
Fifth Amendment of the U.S. Constitution and CBP is permitted to impose punitive
interim measures on Plaintiff without giving Plaintiff the opportunity to defend and
rebut the factual and legal basis for such measures, the EAPA statute is incompatible
with the Fifth Amendment of the U.S. Constitution.” Am. Compl. ¶ 95. The broad
reference in this claim to “the EAPA statute” is too vague to support a convincing
motion for assignment to a three-judge panel on the ground of a constitutional due
process challenge to the entire EAPA statute. The scope of the only EAPA provision the
complaint specifically addresses, the “interim measures” provision of 19 U.S.C.
§ 1517(e), is confined to the temporary suspension or extension of liquidation and the
ordering of additional security for the payment of duties, in the form of increased
bonding or the posting of cash deposits, that may be found to be owed, as measures to
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protect the federal revenue. 2 But even as to that provision, the claim in Count IX is
stated only conditionally: the qualifying introduction, “Insofar as . . . ,” reveals the
conditional nature of this claim. The vague and conditional nature of the constitutional
claim is sufficient reason for the court to decline to order reassignment to a three-judge
panel under 28 U.S.C. § 255(a)(1).
Plaintiffs argue that “this Court cannot avoid a decision on the constitutionality
of the EAPA law and regulations,” Pl.’s Mot. 4, citing the decision of this Court in Royal
Brush Mfg. v. United States, Slip Op. 20-171, 2020 Ct. Intl. Trade LEXIS 179 (Dec. 1, 2020).
2 The “interim measures” provision reads as follows:
Not later than 90 calendar days after initiating an investigation under
subsection (b) with respect to covered merchandise, the Commissioner [of
Customs] shall decide based on the investigation if there is a reasonable
suspicion that such covered merchandise was entered into the customs
territory of the United States through evasion and, if the Commissioner
decides there is such a reasonable suspicion, the Commissioner shall—
(1) suspend the liquidation of each unliquidated entry of such covered
merchandise that entered on or after the date of the initiation of the
investigation; (2) pursuant to the Commissioner’s authority under section
1504(b) of this title, extend the period for liquidating each unliquidated
entry of such covered merchandise that entered before the date of the
initiation of the investigation; and (3) pursuant to the Commissioner’s
authority under section 1623 of this title, take such additional measures as
the Commissioner determines necessary to protect the revenue of the
United States, including requiring a single transaction bond or additional
security or the posting of a cash deposit with respect to such covered
merchandise.
19 U.S.C. § 1517(e).
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Plaintiffs’ reliance on Royal Brush to support their reassignment motion on the ground
stated in 28 U.S.C. § 255(a)(1) is misplaced. Because the holding in that case arose from
due process issues arising out of administrative actions by Customs, see Royal Brush,
2020 Ct. Intl. Trade LEXIS 179 at *13–15, not a constitutional challenge to the EAPA, the
court disagrees with the conclusion that plaintiffs draw from it.
Plaintiffs’ argument under 28 U.S.C. § 255(a)(2) (“broad or significant
implications in the administration or interpretation of the customs laws”) is also
unconvincing. It essentially parrots their argument under § 255(a)(1), with the addition
of arguments grounded in international trade agreements and CPB’s implementing
regulations.
According to plaintiffs, “in an EAPA investigation, an investigation of unfair
trade can proceed without the due process protections to the foreign exporter and U.S.
importer provided in the AD & CVD law” and “includes elements of punitive
proceedings and allows CBP to conduct its investigations in secret for 90 days, with no
notice to the targeted parties.” Pl.’s Mot. 6 (citing 19 U.S.C. § 1517(e)). They add that
“[a]t the 90-day juncture, without any opportunity for the targeted parties to participate
in the investigation, CBP is authorized to impose punitive interim measures against the
imports of the targeted parties and to maintain these interim measures for an indefinite
amount of time.” Id. They argue, further that “the EAPA law is a punitive law” and
that “[t]he unfair trade laws, in contrast, are not punitive, but are remedial in nature.”
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Id. at 7. They assert that the EAPA’s provisional measures authority violates
international obligations of the United States that arise under the World Trade
Organization Uruguay Round Agreement and the Agreement on Implementation of
Article VI of the General Agreement on Tariffs and Trade 1994. Id. at 7–9. According to
plaintiffs, “[t]hus, an important question for the court to consider in this instant case is
the EAPA law’s integration into the overall construct of the AD & CVD law and the
extent to which due process protections under the AD & CVD law are circumvented by
CBP’s EAPA investigations.” Id. at 9. Plaintiffs add that “the cases brought before the
CIT challenging CBP’s decisions in EAPA investigations are also beginning to
multiply.” Id. (citations omitted). Plaintiffs maintain that each of the EAPA
investigations at issue in those cases “was conducted under the same EAPA statute and
regulations that curtail the due process rights of the participants.” Id. at 10. They
identify, specifically, “the right to notice and the right to defend before CBP imposes
punitive interim measures; the inability of participants to adequately defend against
allegations, evidence, and conclusions that are based on confidential information to
which the targeted parties or their legal counsel have no access; and the preclusion of
targeted foreign producers and exporters from meaningful participation in their own
defense.” Id. They offer the view that “[t]he CIT’s appointment of a three-judge panel
will further a uniform resolution to all of the issues arising from CBP’s administration
and interpretation of the [ ] EAPA statute, including a finding by the Court that certain
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provisions of the EAPA statute and regulations cannot be reconciled with the U.S.
Constitution.” Id. at 11 (citing Fundicao Tupy, S.A. v. United States, 11 CIT 23, 652 F.
Supp. 1538 (1987) (appointing a three-judge panel to hear challenge to an affirmative
final determination of injury by the U.S. International Trade Commission and noting an
issue of first impression concerning the interpretation of the “cumulation” provisions of
the antidumping duty laws).
As discussed above, plaintiffs’ claim that the EAPA violates plaintiff’s
constitutional due process rights is stated only vaguely and conditionally. (In Count X
of their complaints, plaintiffs assert a similar due process claim against CBP’s
implementing regulations. See Am. Compl. ¶¶ 97–98). Their showing under 28 U.S.C.
§ 255(a)(2) rests in part on some of the same arguments they advanced under
§ 255(a)(1). Plaintiffs’ allegation that the EAPA statute violates U.S. obligations under
international agreements is not itself sufficient to justify reassignment to a three-judge
panel. The fact that a number of EAPA cases have been filed is also insufficient, by
itself, to justify a three-judge panel according to 28 U.S.C. § 255(a)(2), as it is not
uncommon for the same or similar issues to arise in multiple cases in this Court. Nor is
the court persuaded by plaintiffs’ arguments pertaining to CBP’s regulations
implementing the EAPA. Plaintiffs fail to show that adjudication of this action by a
single judge will be inadequate or inappropriate with respect to any of the claims in
plaintiffs’ complaints.
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Finally, plaintiffs argue that “[t]he benefits and advantages of a decision by a
three-judge panel in this dispute would far outweigh any benefits derived from a single
judge presiding over the action.” Pl.’s Mot. 12. The court disagrees. Having pled a
constitutional challenge to the EAPA only vaguely and conditionally, and having
invoked the criterion of 28 U.S.C. § 255(a)(2) based on issues that are not inappropriate
for adjudication by a single judge, plaintiffs have not presented a compelling reason
why the court, in its discretion, should take the unusual step of reassignment from a
single judge to a three-judge panel, which would entail the commitment of significant
additional judicial resources.
III. CONCLUSION AND O RDER
For the reasons stated above, the court, in its discretion, declines to reassign this
consolidated action to a three-judge panel. Therefore, upon consideration of the
motions of plaintiffs American Pacific Plywood, Inc., U.S. Global Forest, Inc., and
Interglobal Forest, LLC for reassignment of this action to a three-judge panel, all papers
filed herein, and upon due deliberation, it is hereby
ORDERED that the motions for reassignment to a three-judge panel be, and
hereby are, denied.
/s/ Timothy C. Stanceu_____
Timothy C. Stanceu, Chief Judge
Dated: 	March 5, 2021
New York, New York
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