Wanxiang America Corporation v. United States

United States Court of Appeals
for the Federal Circuit
______________________
WANXIANG AMERICA CORPORATION,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
______________________
2020-1044
______________________
Appeal from the United States Court of International
Trade in No. 1:18-cv-00120-GSK, Judge Gary S.
Katzmann.
______________________
Decided: September 2, 2021
______________________
MICHAEL EDWARD R OLL , Roll & Harris LLP, Los Ange-
les, CA, argued for plaintiff-appellant. Also represented by
BRETT HARRIS , Washington, DC.
STEPHEN CARL T OSINI, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, argued for defendant-appellee. Also repre-
sented by J EFFREY B. CLARK, J EANNE D AVIDSON, P ATRICIA
M. MCCARTHY ; N IKKI K ALBING, United States Department
of Commerce, Washington, DC.
______________________
Case: 20-1044 Document: 48 Page: 1 Filed: 09/02/2021

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WANXIANG AMERICA CORPORATION v. UNITED STATES 2
Before M OORE, Chief Judge*, REYNA and T ARANTO, Circuit
Judges.
REYNA, Circuit Judge.
Appellant Wanxiang America Corporation appeals a
judgment of the United States Court of International Trade
determining that it lacks jurisdiction over Appellant’s ac-
tion under 28 U.S.C. § 1581(i), and that Appellant’s claims
concerning a United States Department of Commerce
memorandum are not ripe for judicial review because the
memorandum is not a final agency action. We hold that
the Court of International Trade does not have jurisdiction
under § 1581(i) because Appellant could have sought relief
under another subsection of § 1581, and Appellant has not
shown that such relief would have been manifestly inade-
quate. We do not reach the issue on finality of the memo-
randum. Affirmed.
BACKGROUND
This appeal involves a complicated and technical ad-
ministrative record concerning how antidumping duties
are determined, assessed, and collected. The record also
involves Pre-Penalty and Penalty Notices issued to U.S.
importers whom the U.S. Customs and Border Protection
(“Customs”) has determined are in violation of U.S. cus-
toms laws and regulations governing imports of goods that
are subject to antidumping duties. The United States
Court of International Trade (“CIT”) provided a thorough
and detailed review of the record, so we forgo repeating
that recitation here and reference only those aspects of the
record that are pertinent to the main issue on appeal, the
jurisdiction of the CIT.
* Chief Judge Kimberly A. Moore assumed the posi-
tion of Chief Judge on May 22, 2021.
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WANXIANG AMERICA CORPORATION v. UNITED STATES 3
Plaintiff-Appellant Wanxiang America Corporation
(“Wanxiang”) is a U.S. importer for its parent corporation,
Wanxiang Group Corporation (“Wanxiang Group”), an au-
tomotive parts manufacturing company headquartered in
China. J.A. 141. The history leading to this appeal in-
volves additional Wanxiang Group subsidiaries, including
two of its Chinese exporters, Wanxiang Import and Export
Co., Ltd. (“Wanxiang IE”), and Wanxiang Qianchao Co.,
Ltd. (“Wanxiang Q”). J.A. 42–43.
From 1994 to 2001, Wanxiang Group and Wanxiang IE
participated in annual administrative reviews conducted
by the U.S. Department of Commerce (“Commerce”) that
covered entries of first-generation wheel hub assemblies
that were subject to a 1987 antidumping duty order on ta-
pered roller bearings (“TRBs”) from China. J.A. 40–42; see
Tapered Roller Bearings From the People’s Republic of
China; Final Determination of Sales at Less Than Fair
Value, 52 Fed. Reg. 19,748 (May 27, 1987) (“TRB Anti-
dumping Duty Order”). As a result of those reviews, Wan-
xiang Group and Wanxiang IE were assigned company-
specific antidumping duty rates of zero percent. J.A. 41,
60. This means that although imports from those two re-
lated companies were subject to the TRB Antidumping
Duty Order, they were found not to be dumping and, there-
fore, received zero-percent dumping rates. Wanxiang Q, on
the other hand, did not receive a company-specific anti-
dumping duty rate because, as the record shows, it did not
participate in the reviews. J.A. 60.
Wanxiang later imported second- and third-generation
wheel hub assemblies from Wanxiang Q, and on the cus-
toms entry forms, it classified the entries as not subject to
any antidumping duty order. See J.A. 43–44; Appellant’s
Opening Br. 14. It is undisputed that a 2010 scope inquiry
conducted by Commerce determined the second- and third-
generation wheel hub assemblies were within the scope of
the TRB Antidumping Duty Order. J.A. 574–75; see also
Power Train Components, Inc. v. United States, 911 F.
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WANXIANG AMERICA CORPORATION v. UNITED STATES 4
Supp. 2d 1338 (Ct. Int’l Trade 2013), aff’d mem., 565 F.
App’x 899 (Fed. Cir. 2014).
In June 2012, Customs initiated an audit of Wan-
xiang’s entries of wheel hub assemblies during the five-
year period of October 1, 2007, to September 30, 2012.
J.A. 141–42, 575–76. Due to the large number of entries
made by Wanxiang during the review period, Customs
chose to analyze a statistical sample of 100 entries.
J.A. 137, 142.
During the audit, Wanxiang suggested that Wan-
xiang Q was subject to Wanxiang Group’s zero-percent an-
tidumping duty rate.1 J.A. 44–45, 151. On February 25,
2015, Commerce sent Customs a report titled “Guidance to
CBP.” J.A. 59–60. The report was sent “[i]n response to
[Customs’] inquiry” and was based on Commerce’s “review”
of “documents previously sent to [Customs],” which had
been submitted during the annual administrative review
periods from 1994–2001. J.A. 60. Commerce explained
that none of the documents from the relevant review peri-
ods “clearly identified [Wanxiang Q] itself as being a man-
ufacturer or exporter of subject merchandise.” Id.
Commerce further confirmed that upon its examination of
the records from the reviews, “no evidence . . . suggested
that [Wanxiang Q] exported the subject merchandise dur-
ing the relevant [periods of review].” Id.
On September 2, 2015, Customs issued its final audit
report, finding that some of the audited entries were im-
ports of wheel hub assemblies from Wanxiang Q. See
J.A. 143, 148–49, 577. But since Wanxiang Q did not
1 It also appears that Wanxiang maintained, alter-
natively, that it had no reason to believe that the newer-
generation wheel hub assemblies were subject to the TRB
Antidumping Duty Order. See Appellant’s Opening
Br. 7–15.
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WANXIANG AMERICA CORPORATION v. UNITED STATES 5
participate in the relevant annual reviews (as indicated in
the Guidance to CBP), it never received a company-specific
dumping rate. J.A. 148–49. As a result, Customs deter-
mined that the Wanxiang Q imports were subject to the
China country-wide rate of 92.84% ad valorem, the rate ap-
plicable to Chinese companies that otherwise did not re-
ceive a company-specific rate. Id. Customs also
determined, based on the sampling results and a projection
over the sampling frame, that Wanxiang had underpaid
dumping duties by a significant amount. J.A. 143, 148. Af-
ter the final audit report was issued, representatives from
Wanxiang and the Wanxiang Group met with the Secre-
tary of Commerce and the Under Secretary of Commerce
for International Trade to discuss the audit. J.A. 70.
On May 25, 2016, Customs Liaison Unit placed a mem-
orandum on the record (“CLU Memo”). J.A. 58. Three doc-
uments were attached to the CLU Memo: (1) Commerce’s
February 2015 Guidance to CBP; (2) a corporate organiza-
tional chart provided by Wanxiang Group that was previ-
ously attached to the Guidance; and (3) a June 2013
announcement in which Commerce noted that two Wan-
xiang Group subsidiaries2 (but not Wanxiang Q) were sub-
ject to the zero-percent rate. J.A. 58–64. The CLU Memo
described the Guidance to CBP as providing guidance “re-
garding the entities in the 1994–2001 administrative re-
view periods that were entitled to the Wanxiang Group[’s]
cash deposit rate” of zero percent. J.A. 58. The CLU Memo
also stressed that the information provided therein did “not
constitute new factual information on the record of this
closed segment of the proceeding.” Id.
Almost two years later, in January 2018, Customs is-
sued a Pre-Penalty Statement notifying Wanxiang that it
may be liable for paying lost revenue (antidumping duties)
and a substantial penalty for misclassification of entries
2 Those entities are not relevant to this appeal.
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WANXIANG AMERICA CORPORATION v. UNITED STATES 6
and failure to pay antidumping duties. J.A. 107–10. In
April 2019, Customs issued a Penalty Notice demanding
that Wanxiang pay specific amounts in lost revenue and
penalties. Appellant’s Opening Br. 20–21. Notably, Wan-
xiang did not protest the Penalty Notice pursuant to
19 U.S.C. § 1514, and Wanxiang has not made payment on
the dumping duties or the penalty. Oral Arg. 7:40–59,
http://oralarguments.cafc.uscourts.gov/default.aspx?fl=20-
1044_11032020.mp3. Instead, Wanxiang chose to chal-
lenge the Penalty Notice by suing Commerce.
CIT ACTION
On May 23, 2018, Wanxiang filed a complaint before
the CIT, asserting jurisdiction under 28 U.S.C. § 1581(i)(2)
and (4).3 J.A. 37. Specifically, Wanxiang alleged that the
3 Congress later amended 28 U.S.C. § 1581(i) to re-
designate subparagraphs (1) through (4) as subparagraphs
(1)(A) through (1)(D), respectively. See United States-Mex-
ico-Canada Agreement Implementation Act, Pub. L.
No. 116–113, § 423(a)(1), 134 Stat. 11, 65 (2020). The rele-
vant § 1581(i) subsections, now (1)(B) and (1)(D), provide:
(i) (1) In addition to the jurisdiction conferred
upon the [CIT] by subsections (a)–(h) of
[§ 1581] . . . , the [CIT] shall have exclusive ju-
risdiction of any civil action commenced against
the United States, its agencies, or its officers,
that arises out of any law of the United States
providing for— . . .
(B) tariffs, duties, fees, or other taxes on the
importation of merchandise for reasons
other than the raising of revenue; . . . or
(D) administration and enforcement with re-
spect to the matters referred to in [§ 1581].
28 U.S.C. § 1581(i).
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WANXIANG AMERICA CORPORATION v. UNITED STATES 7
Guidance to CBP issued by Commerce violated Due Pro-
cess and was otherwise contrary to law or unsupported by
substantial evidence. J.A. 51–54. Wanxiang sought a re-
mand for Commerce to “reconsider[]” whether Wanxiang Q
was entitled to the Wanxiang Group zero-percent dumping
rate. J.A. 55.
The government moved to dismiss for lack of subject-
matter jurisdiction. See Wanxiang Am. Corp. v. United
States, 399 F. Supp. 3d 1323, 1330 (Ct. Int’l Trade 2019).
The CIT granted the motion after concluding, among other
things, that it lacked jurisdiction under § 1581(i) because
the relief sought by Wanxiang “could have been available
under a . . . § 1581(c) action.” Id. at 1331–32. The CIT held
that because Wanxiang could have sought relief through
§ 1581(c), Wanxiang could not now assert residual jurisdic-
tion through § 1581(i). Id. Wanxiang appeals the dismis-
sal. We have jurisdiction under 28 U.S.C. § 1295(a)(5).
D ISCUSSION
We review the CIT’s grant of a motion to dismiss de
novo. Juice Farms, Inc. v. United States, 68 F.3d 1344,
1345 (Fed. Cir. 1995). This court must accept as true all
well-pleaded factual allegations and draw all reasonable
inferences in favor of the claimant. Hartford Fire Ins. Co.
v. United States, 772 F.3d 1281, 1284 (Fed. Cir. 2014). A
party invoking the CIT’s jurisdiction has the burden of es-
tablishing that jurisdiction. Norsk Hydro Can., Inc.
v. United States, 472 F.3d 1347, 1355 (Fed. Cir. 2006).
This court has long held that § 1581(i) is a statute of
residual jurisdiction that may not be invoked where juris-
diction is or could have been available under any other sub-
section of § 1581, unless such other relief would be
manifestly inadequate. Miller & Co. v. United States,
824 F.2d 961, 963 (Fed. Cir. 1987) (collecting cases); ac-
cord, e.g., Ford Motor Co. v. United States, 688 F.3d 1319,
1323 (Fed. Cir. 2012). Thus, when assessing jurisdiction
under § 1581(i), we primarily consider (1) whether
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WANXIANG AMERICA CORPORATION v. UNITED STATES 8
jurisdiction under a subsection other than § 1581(i) was
available, and (2) if so, whether the remedy provided under
that subsection is “manifestly inadequate.” Erwin Hymer
Grp. N.A., Inc. v. United States, 930 F.3d 1370, 1375
(Fed. Cir. 2019).
As a threshold matter, we note that Wanxiang does not
argue in its opening brief that relief under another subsec-
tion of § 1581 would be manifestly inadequate. Nor did
Wanxiang raise a “manifestly inadequate” argument at the
CIT. Wanxiang, 399 F. Supp. 3d at 1331 n.10. Given these
circumstances, we find that Wanxiang has waived or for-
feited the argument that any other relief that may have
been available to it was manifestly inadequate. See Op-
tivus Tech., Inc. v. Ion Beam Applications S.A., 469 F.3d
978, 989 (Fed. Cir. 2006) (“An issue not raised by an appel-
lant in its opening brief is waived.” (citation and alterations
omitted)); see also Indus. Chems., Inc. v. United States,
941 F.3d 1368, 1373 n.3 (Fed. Cir. 2019) (deeming § 1581(i)
argument waived on appeal where appellant did not raise
issue before the CIT). Therefore, the only question we must
decide is whether jurisdiction “is or could have been avail-
able” under any other subsection of § 1581. Miller & Co.,
824 F.2d at 963.
We hold that the CIT lacks subject-matter jurisdiction
under § 1581(i) because Wanxiang could have sought relief
under another subsection of § 1581. In essence, Wanxiang
is protesting having to pay antidumping duties and penal-
ties on entries identified during the customs audit. See
J.A. 55. But Wanxiang could have challenged the assess-
ments by pursuing a protest under 19 U.S.C. § 1514 (“Pro-
test Against Decisions of Customs Service”) and then, if
unsuccessful, by challenging unfavorable results before the
CIT under § 1581(a).4 Alternatively, Wanxiang could have
4 Subsection 1581(a), which governs the CIT’s juris-
diction to review Customs’ treatment of protests, sets forth
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WANXIANG AMERICA CORPORATION v. UNITED STATES 9
initiated a test shipment and sought, as a new shipper, an
administrative review of the entries. During the review,
Wanxiang would have had the opportunity to argue the is-
sues it raised in its complaint before the CIT. In addition,
the results of the administrative review could have been
challenged before the CIT pursuant to 19 U.S.C. § 1516a,
invoking jurisdiction of the CIT under § 1581(c).5
Wanxiang concedes it could have sought administra-
tive review and then challenged unfavorable results at the
CIT under § 1581(c). Oral Arg. at 4:15–46; 4:54–5:03;
5:28–6:30. Wanxiang, however, asserts § 1581(i) jurisdic-
tion because, in its view, it was not legally compelled to
take that route. Id. at 6:22–30 (“Yes, [Wanxiang] could
have done all of that. There’s no question they could have
done all of that. The question, though, is: Were they re-
quired to do all of that?”). But Wanxiang misapprehends
the § 1581(i) standard, which asks only whether another
route under § 1581 existed that was not manifestly inade-
quate. It is true that Wanxiang had the choice of whether
or not to file a protest or seek an administrative review, but
having made the choice not to do so, the relief it seeks now
an express scheme for administrative and judicial review
of Customs’ penalty actions. Under this statutory scheme,
an aggrieved party must first file a protest with Customs
under 19 U.S.C. § 1514 before it can file suit in the CIT un-
der § 1581(a) to contest denials. Int’l Custom Prods., Inc.
v. United States, 467 F.3d 1324, 1326–27 (Fed. Cir. 2006).
5 Subsection 1581(c) grants the CIT exclusive juris-
diction over any civil action commenced under 19 U.S.C.
§§ 1516a or 1517. See 28 U.S.C. § 1581(c). This includes
the “jurisdiction to consider challenges to Commerce’s as-
sessment of antidumping duties based on its determination
during administrative reviews.” Juancheng Kangtai
Chem. Co. v. United States, 932 F.3d 1321, 1329 (Fed. Cir.
2019).
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WANXIANG AMERICA CORPORATION v. UNITED STATES 10
under § 1581(i) is foreclosed. An importer may not simply
“elect to proceed under [§] 1581(i), without having first
availed himself of the remedy provided by [§] 1581(c).”
Sunpreme Inc. v. United States, 892 F.3d 1186, 1193
(Fed. Cir. 2018) (quoting JCM, Ltd. v. United States,
210 F.3d 1357, 1359 (Fed. Cir. 2000)).
An importer cannot successfully assert § 1581(i) juris-
diction via “creative pleading.” Id. (quoting Norsk,
472 F.3d at 1355). This court will “look to the true nature
of the action” brought before the CIT under § 1581(i) to de-
termine whether the action could have been brought under
another subsection of § 1581. Id. (quoting Norsk, 472 F.3d
at 1355). For instance, in Sunpreme, the importer sought
a refund of cash deposits, an end of suspension of liquida-
tion, and release from having to make future cash deposits,
all of which we found to be “the very relief associated with
a scope ruling determination.” Id. Despite its pleading, it
was clear that Sunpreme sought “a decision that its prod-
ucts [we]re not subject to the scope of the [antidumping
duty] orders,” so we reversed the CIT’s exercise of § 1581(i)
jurisdiction because Sunpreme had available to it relief un-
der § 1581(c). Id. at 1193–94.
Similarly, in Juancheng Kangtai Chemical Co. v.
United States, we affirmed the CIT’s dismissal for lack of
jurisdiction because jurisdiction was available to Kangtai
under § 1581(c). 932 F.3d 1321, 1328–29 (Fed. Cir. 2019).
Although Kangtai asserted jurisdiction under § 1581(i)(2)
and (4)—as Wanxiang does here—we observed that the
“true nature” of Kangtai’s action was to protest Com-
merce’s assessment of antidumping duties on entries, and
it could have sought relief under § 1581(c). Id. at 1328.
Further, we determined that Kangtai failed to demonstrate
such relief would have been manifestly inadequate. Id.
at 1329–30. Thus, despite Kangtai’s attempt to base its ac-
tion in § 1581(i), we held that such jurisdiction was una-
vailable.
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WANXIANG AMERICA CORPORATION v. UNITED STATES 11
Here, the true nature of Wanxiang’s complaint is that
Wanxiang seeks to avoid paying antidumping duties and a
penalty assessed against it via a Penalty Notice. See
J.A. 55. The bases of its complaint are issues routinely first
brought up and challenged in protest proceedings and ad-
ministrative reviews. See, e.g., Guizhou Tyre Co. v. United
States, No. 17-00100, 2021 WL 1944431 (Ct. Int’l Trade
May 14, 2021); Husteel Co. v. United States, No. 19-00107,
2021 WL 1740367 (Ct. Int’l Trade May 3, 2021).
CONCLUSION
We agree with the CIT that Wanxiang chose to forgo
available avenues to administrative relief that could have
resulted in the CIT’s proper exercise of jurisdiction under
§ 1581(a) or (c). Wanxiang does not argue that such relief
under those subsections would have been manifestly inad-
equate. As a result, Wanxiang cannot now avail itself of
the CIT’s residual jurisdiction under § 1581(i). The CIT
therefore properly dismissed this case for lack of subject-
matter jurisdiction. Because the CIT lacked jurisdiction
under § 1581(i), we do not reach the questions concerning
the finality of the CLU Memo. The judgment of the CIT is
affirmed.
AFFIRMED
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