UNITED STATES COURT OF INTERNATIONAL TRADE

Slip Op. 24-58

Before the Court in Auxin Solar, Inc. v. United States, Court No. 23-00274, Slip Op. 23-58 (May 9, 2024) were cross motions to dismiss, motions to intervene of nine proposed defendant-intervenors, a supplemental protective order filed by proposed defendant-intervenors, and a joint stipulation in lieu of preliminary injunction proposed by plaintiffs, Auxin Solar Inc. and Concept Clean Energy, Inc. (“CCE”) (together “plaintiffs”). Plaintiffs brought this action under the Administrative Procedure Act (“APA”) 5 U.S.C. § 706(2) and sought relief pursuant to the Declaratory Judgment Act, 28 U.S.C. § 2201(a) alleging that the U.S. government failed to collect antidumping and countervailing duty cash deposits and failed to suspend liquidation on products circumventing the antidumping and countervailing duty orders on CSPV cells and modules from China. Defendant moved to dismiss the action contending that residual jurisdiction pursuant to 28 U.S.C. § 1581(i) was not available, arguing subject matter jurisdiction should have been invoked under 28 U.S.C. § 1581(c).

The Court of International Trade held that this action could not have been brought under 28 U.S.C. § 1581(c) and falls within its residual jurisdiction. Plaintiffs initially filed a complaint to challenge the U.S. Department of Commerce’s rulemaking, determinations and instructions concerning the preliminary and final determinations in the circumvention inquiries covering Crystalline Silicon Photovoltaic (“CSPV”) cells whether or not assembled into modules (“cells”) imported from Cambodia, Malaysia, Thailand, and Vietnam using parts and components from the People’s Republic of China. Commerce had been applying antidumping and countervailing duty orders covering CSPV cells and modules from China since 2012. See Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, from the People’s Republic of China: Amended Final Determination of Sales at Less Than Fair Value, and Antidumping Duty Order, 77 Fed. Reg. 73,018 (Dep’t of Commerce Dec. 7, 2012); Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, from the People’s Republic of China: Countervailing Duty Order, 77 Fed. Reg. 73,017 (Dep’t of Commerce Dec. 7, 2012). In Presidential Proclamation 10414 of June 9, 2022, Commerce obtained authority to permit CSPV cells into the United States “free for the collection” of antidumping and countervailing duties. One year later, on August 23, 2023, Commerce issued a final determination concluding that CSPV cells and modules from Cambodia, Malaysia, Thailand, and Vietnam were circumventing the antidumping and countervailing duty orders on CSPVs from China. 88 Fed. Reg. 57,419, 57,421-22 (Dep’t of Commerce Aug. 23, 2023); 87 Fed. Reg. 75,221, 75,223-26 (Dep’t of Commerce Dec. 8, 2022). This presidential action arose from the president’s declared emergency to meet domestic electricity demands at a time where it was uncertain as to whether the United States would have enough energy to meet the expected customer demand. Further, relying on the Duty Suspension Rule, Commerce exempt “all applicable entries” that were certified to be utilized within 180 days after the expiration of the emergency period indicated by Presidential Proclamation 10414 from collection and assessment of antidumping and countervailing duties.

The question of whether the relief provided to plaintiffs would be “manifestly inadequate” was not addressed because the court determined jurisdiction under 28 U.S.C. § 1581(c) was not available. Defendants argued that “[b]ecause jurisdiction is, or could have been, available pursuant to 28 U.S.C. § 1581(c), this Court cannot exercise its limited residual jurisdiction over the complaint pursuant to section 1581(i).” In October 2023, plaintiffs had commenced four actions at the CIT challenging various aspects of the final circumvention determinations and invoking this Court’s jurisdiction pursuant to 28 U.S.C. § 1581(c). Auxin Solar, Inc. v. United States, Court Nos. 23-223, 23-224, 23-225. However, those actions unlike the 2024 case, did not challenge the Presidential Proclamation or the Duty Suspension Rule at issue here. As such, the court stated that the instant action deals with actions expressly described under 28 U.S.C. § 1581(i)(1): the non-collection of “tariffs, duties, fees, or other taxes on the importation of merchandise for reasons other than the raising of revenue.” In other words, the court characterized this action as one relating to Commerce’s liquidation instructions and Commerce’s failure to order the collection of duties consistent with its findings in the Final Determinations.

As to the second issue, the court decided the Joint Stipulation in lieu of plaintiff’s motion for a preliminary injunction should be granted because plaintiffs and defendants stipulated to the authority of the court to order reliquidation and direct the United States to reliquidate entries “for which liquidation was not suspended and cash deposits were not collected pursuant to Procedures Covering Suspension of Liquidation, Duties and Estimated Duties in Accord with Presidential Proclamation 10414, 87 Fed. Reg. 56,868 (Sept. 16, 2022).” Joint Stipulation ¶ 1. Additionally, the Joint Stipulation served to clarify the purpose which was to support the availability of reliquidation as a remedial power, which defendants conceded in the instant action. See Defs.’ Resp. Order re: Joint Stipulation at 2, ECF No. 72; see Pls.’ Resp. Order re: Joint Stipulation at 2, ECF No. 73 (stating that “Defendants obtain the benefit of mooting Solar Plaintiffs’ Motion and avoiding a court-imposed injunction”); Sumecht NA, Inc. v. United States, 923 F.3d 1340 (Fed. Cir. 2019)

As to whether intervenors meet the requirements to participate in the action, the court relied on the standard set out by the Federal Circuit. That rationale states that:

A defendant-intervenor does not fit the same mold as the traditional unwilling defendant. Rather, a defendant-intervenor actively seeks to participate in the resolution of a case in which the plaintiff did not bring a claim against or request any relief from the proposed intervenor. Thus, “where a party tries to intervene as another defendant,” that defendant-intervenor must “demonstrate Article III standing.”

 California Steel, 48 F.4th at 1343 (quoting Crossroads Grassroots Pol’y Strategies v. Fed. Election Comm’n, 788 F.3d 312, 316 (D.C. Cir. 2015)).

Plaintiffs argued that none of the proposed intervenors has established Article III Standing because they failed to submit an accompanying pleading setting out a prayer for relief and the defense for which intervention is sought. The court disagreed, however, finding that proposed defendant-intervenors demonstrated that they met Article III piggyback standing to intervene in the instant action because proposed defendant-intervenors sought the same relief as named defendants and filed their motions to intervene with sufficient pleadings.

Plaintiffs argued that none of the proposed defendant-intervenors meets any of the four factors to be weighed by the court in deciding motions to intervene as a matter of right. The court concludes that none of the proposed defendant-intervenors meets the second and third factors of the four-part test, thereby failing to meet the standard for intervention as of right under USCIT Rule 24(a). According to Sumitomo Metal Indus., Ltd. v. Babcock & Wilcox Co., 69 CCPA 75, 81, 669 F.2d 703, 707 (1982), the factors to be weighed are (1) the length of time during which the would-be intervenor actually knew or reasonably should have known of his right to intervene in the case before he applied to intervene; (2) whether the prejudice to the rights of existing parties by allowing intervention outweighs the prejudice to the would-be intervenor by denying intervention. [sic] (3) existence of unusual circumstances militating either for or against a determination that the application is timely. The court concluded that the timing of the motions to intervene weighed in favor of proposed defendant-intervenors under the Sumitomo standard. The court found the motions to intervene to be timely under the standard set out in Sumitomo Metal Indus., Ltd. v. Babcock & Wilcox Co., 69 CCPA 75, 81, 669 F.2d 703, 707 (1982) (citations omitted).[1] Further, the court found that the defendant-intervenors had a “legally protectable” interest rather than “merely economic” to the extent that defendant-intervenors may be affected financially by the court’s judgment concerning the Duty Suspension Rule. However, the court stated that the rulemaking process and the substance of the Duty Suspension Rule do not create legally protectable interests beyond “merely economic” ones. For this reason, the court decided that intervention as a matter of right was not available in the instant action. Because the court concluded that the second factor is not met, it was held that there can be no direct relationship between the litigation and the interests of proposed defendant-intervenors.

Although proposed defendant-intervenors did not meet the factors above, they did demonstrate that their interests are not adequately protected by the government in the instant action. Thus, the court went on to analyze the question of whether proposed defendant-intervenors should nevertheless be permitted to intervene. The court considered how defendant-intervenors might be adversely affected or aggrieved within the meaning of 28 U.S.C. § 2631(j)(1). The court also considered that defendant-intervenors showed they rely on the Duty Suspension Rule in making business decisions, as well as rely on the potential financial ramifications of the instant action. Moreover, the court discussed the fact that proposed defendant-intervenors represent a segment of the solar industry that is aligned with the position of defendants. Def.-Int. Reply II at 14. As such, and based on their filings, the court concluded that proposed defendant-intervenors demonstrated that they share a common question of law or fact with defendants and that proposed defendant-intervenors would defend their differentiated interests in this case. Id. Lastly, on the question of undue prejudice, the court discussed how the reliquidation of entries would affect not only defendants in the instant action, but also proposed defendant-intervenors. Weighing plaintiffs’ rights under Rule 1 with the interests and rights of proposed defendant-intervenors and the court’s interest in receiving a thorough understanding of the legal and factual issues presented and the perspectives of interested parties, the court determined that the intervention of proposed defendant-intervenors would not “unduly delay or prejudice the adjudication of the original parties’ rights.” USCIT R. 24(b).

The United States Court of International Trade denied the United States government motion to dismiss and granted the joint stipulation of plaintiffs and defendants, as well as the motion to intervene of nine proposed defendant-intervenors and the protective order filed by the proposed defendant-intervenors.

[1] [T]he following factors must be weighed:

(1) the length of time during which the would-be intervenor actually knew or reasonably should have known of his right to intervene in the case before he applied to intervene;

(2) whether the prejudice to the rights of existing parties by allowing intervention outweighs the prejudice to the would-be intervenor by denying intervention. [sic]

(3) existence of unusual circumstances militating either for or against a determination that the application is timely.