United States Court of International Trade

Default Judgment Granted in Favor of U.S.

In U.S. v. Paul Puentes, Court No. 14-310, Slip Op. 17-33 (March 29, 2017), plaintiff Government brought this action to recover a civil penalty imposed on Defendant Paul Puentes (“Puentes”) by the Bureau of Customs and Border Protection (“Customs”). Before the court was  Plaintiff’s Motion for Entry of Default Judgment, which sought judgment against Puentes in the amount of $30,000, as well as post-judgment interest and costs.  The two counts of the Government’s Complaint address four types of misconduct, which the Government characterizes as “Merchandise Processing Fees Deception,” “Late Entry Summaries,” “Failure To File Entry Summaries,” and “Misrepresentation Of The Importer of Record.”  Taking the facts alleged in the complaint to be true, the government has provided a basis for Puentes’ liability.  Because Puentes has not responded to the complaint, the Court found in favor of the plaintiff and held Puentes liable in the amount of $30,000 for his misconduct.

Cash Deposit Rate Set Aside

In Cooper Tire & Rubber Company, Cooper (Kunshan) Tire Co., Ltd., and Cooper Chengshan (Shandong) Tire Co., Ltd. v. United States, Slip Op. 17-32, Court No. 15-00251 (March 29, 2017), plaintiffs, Cooper Chengshan (Shandong) Tire Co., Ltd., Cooper (Kunshan) Tire Co., Ltd., and Cooper Tire & Rubber Company, collectively known as “Cooper,”  challenge the antidumping duty cash deposit rate of 11.12% ad valorem that the International Trade Administration, U.S. Department of Commerce (“Commerce” or the “Department”) applied to imports of passenger car and light truck tires that they produced and exported from the People’s Republic of China. For the reasons set forth, the Court set aside the cash deposit rate provided for Cooper.

Cooper was a respondent in parallel antidumping duty (“AD”) and countervailing duty (“CVD”) investigations conducted by Commerce. Cooper arguedthat Commerce erred in not allowing Cooper the benefit of a 13.53% downward export subsidy adjustment, which was the adjustment Commerce allowed for all other separate rate respondents in the AD investigation. Specifically, “even though Cooper is an AD separate rate respondent like the 62 other separate rate respondents, the AD cash deposit rate for Cooper is 11.12% ad valorem and that of all the other 62 separate rate respondents is 8.72% ad valorem.” Slip Op. pg. 10 (citing Cooper’s Brief, pg. 7).  There was no rational basis for treating Cooper differently from other separate AD respondents.  In the alternative, if Commerce were to treat Cooper separately Commerce should account for the record evidence in the CVD investigation recalculating the cash deposit rate down to 6.03% ad valorem.

However, the Court saw an issue with not having Cooper examined individually and not providing a rational basis for differing rates. The uncontested record facts pertaining to the cash deposits did not provide Commerce with a rational basis upon which to treat Cooper differently than the other separate rate respondents. If individually examined in the first review, Cooper would not receive a dumping margin determined by a method parallel to the “hybrid” method Commerce used to calculate its adjusted cash deposit in the AD investigation, which combines an all-others antidumping duty margin and an individually-determined export subsidy adjustment. Because the “hybrid” method Commerce employed as a means of estimating future AD duty liability has no basis in the statute, Commerce acted arbitrarily and capriciously in treating Cooper differently from the other separate rate respondents in the investigation. Therefore, defendant was not correct in arguing that the adjustment Commerce made “ensured that the export subsidy adjustment credited Cooper for the export subsidy rate that will be applied to it.