Full Opinion (html_with_citations)

                                         Slip. Op. 10-141

                UNITED STATES COURT OF INTERNATIONAL TRADE


                                          :
TARGET CORPORATION,                       :
                                          :
                  Plaintiff,              :
            v.                            :                   Before: Jane A. Restani, Judge
                                          :
UNITED STATES,                            :                   Court No. 10-00353
                                          :
                  Defendant.              :
_________________________________________ :


                                            OPINION

[Plaintiff’s motion for preliminary injunction is granted.]

                                                                        Dated: December 23, 2010

               Neville Peterson LLP (John M. Peterson and Maria E. Celis) for the plaintiffs.

                Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, Patricia M
McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department
of Justice (Stephen C. Tosini); Office of the Chief Counsel for Import Administration, U.S.
Department of Commerce (Thomas M. Beline), of counsel; Office of the Assistant Chief Counsel
International Trade Litigation, U.S. Customs and Border Protection (Paula S. Smith), of counsel,
for the defendant.

               The matter is before the court on plaintiff’s motion for a preliminary injunction of

liquidation of entries imported by plaintiff into the United States. That injunction has been

granted.1

                                         BACKGROUND

               Target Corporation (“Target”) is an importer of cased pencils from the People’s



       1
       A temporary restraining order with respect to entries made through the Port of
Savannah, Georgia was issued on December 7, 2010. Order (Dec. 7, 2010) (Docket No. 9).
Court No. 10-00353                                                                           Page 2


Republic of China (“PRC”). See Complaint ¶ 3 (Docket No. 2). Such merchandise is covered by

an antidumping duty order. See Antidumping Duty Order: Certain Cased Pencils from the

People’s Republic of China,
59 Fed. Reg. 66,909
, 66,909 (Dep’t Commerce Dec. 28, 1994). At

issue here are liquidation instructions relating to an administrative review of that order. See

Certain Cased Pencils from the People’s Republic of China,
75 Fed. Reg. 38,980
, 38,980 (Dep’t

Commerce July 7, 2010) (“Final Results”). The review covered entries into the United States

made during the period December 1, 2007, through November 30, 2008.
Id. at 38,981
. Although

there is a China-wide entity rate of in excess of 100%, two companies which produced the cased

pencils imported by Target were mandatory respondents in the review and demonstrated that they

were separate from the China-wide entity. See
id.
 They are China First Pencil Company, Ltd.

(“China First”) and Shanghai Three Star Stationery Co., Ltd. (“Three Star”). See
id.
 The Final

Results established “a per-unit assessment rate for each importer (or customer)” of these

producers.
Id. at 38,982
.

               Plaintiff asserts that the Liquidation Instructions issued by the Department of

Commerce (“Commerce”) to the Bureau of Customs and Border Protection (“Customs”) are

inconsistent with the Final Results. Mem. of P&A in Supp. of Pl.’s Application for a TRO and

Prelim. Inj. Against Liquidation of Certain Entries 14 18.

               The key paragraph of the Liquidation Instructions is as follows:

       1. FOR ALL SHIPMENTS OF CERTAIN CASED PENCILS FROM THE
       PEOPLE”S REPUBLIC OF CHINA EXPORTED BY THREE STAR
       STATIONARY INDUSTRY CO., LTD. (A-570-827-005), IMPORTED BY, OR
       SOLD TO, THE IMPORTER OR CUSTOMER (AS INDICATED ON THE
       COMMERCIAL INVOICE OR CUSTOMS DOCUMENTATION) LISTED
       BELOW AND ENTERED, OR WITHDRAWN FROM WAREHOUSE, FOR
Court No. 10-00353                                                                             Page 3


       CONSUMPTION DURING THE PERIOD 12/01/2007 THROUGH 11/30/2008.
       ASSESS AN ANTIDUMPING LIABILITY EQUAL TO THE PER-UNIT
       DOLLAR AMOUNT FOR EACH UNIT OF SUBJECT MERCHANDISE
       LISTED BELOW.

Confidential Administrative R. (“Admin. R.”) 1102. There is a similar paragraph for China First.

See
id. at 1096
. It differs only because it names certain affiliates of China First as exporters,

which affiliates are also listed in the Final Results. Compare
id. at 1102
, with Final Results, 75

Fed. Reg. at 38,981. The list referred to contains the names of “importer(s) or customer(s)” of

the Chinese manufacturers. Among the “customers” are certain entities which were involved in

the Target entries at issue. In some cases they may be affiliated with purchasing agents in the

United States, which placed orders for Target, the importer of record.

               The problem arose here because Three Star, and China First (including its named

affiliates) apparently are not listed as “exporters” in the documents presented to Customs, but

rather as “manufacturers” and the “exporters” seem in most cases to be the “customers.”

Customs decided either on its own or under advice from Commerce to begin to liquidate these

entries under this paragraph of the Liquidation Instructions:

       1. FOR ALL SHIPMENTS OF CERTAIN CASED PENCILS FROM THE
       PEOPLE’S REPUBLIC OF CHINA (PRC) EXPORTED BY THE PRC-WIDE
       ENTITY (A-570-827-000) ENTERED, OR WITHDRAWN FROM
       WAREHOUSE, FOR CONSUMPTION DURING THE PERIOD 12/01/2007
       THROUGH 11/30/2008, ASSESS AN ANTIDUMPING LIABILITY EQUAL TO
       114.90 PERCENT OF THE ENTERED VALUE. ENTRIES MAY HAVE ALSO
       ENTERED UNDER CASE NUMBERS A-570-827-001, A-570-827-007, AND
       A-570-827-011.

Admin. R. 1092.

               Documentation presented to the court and examined by the Government indicate
Court No. 10-00353                                                                                Page 4


that the sales at issue are for the most part the very sales of China First and Three Star that

Commerce analyzed in arriving at the very low or de minimis customer specific assessment rates

Target seeks to have applied to its entries, as opposed to the China-wide entity rate of 114.90

percent.

                                         JURISDICTION

               If the Liquidation Instructions described above varied from the Final Results or

reflected some decision made by Commerce after the Final Results, jurisdiction would lie under
28 U.S.C. § 1581
(i)2 to correct any error. If an error occurred in the Final Results for any reason,

including failure of Target’s manufacturers to present some information to Commerce,

jurisdiction would lie only under
28 U.S.C. § 1581
(c).3 The United States alleges that is the case.

The statute of limitation has expired for an action under § 1581(c) and, in any case, plaintiff was

not a participant in the underlying proceeding so it lacks standing to proceed under that section.

See
28 U.S.C. § 2631
(c). As an interested party, the importer, plaintiff could have participated.
Id.
 If plaintiff had an adequate remedy under
28 U.S.C. § 1581
(c), it may not bring an action



       2
            “[T]he Court of International Trade shall have exclusive jurisdiction of any civil action
commenced against the United States . . . that arises out of any law of the United States providing
for . . . tariffs, duties, fees, or other taxes on the importation of merchandise” or the
“administration and enforcement” thereof.
28 U.S.C. § 1581
(i)(2), (4). Nevertheless, “[t]his
subsection shall not confer jurisdiction over an antidumping or countervailing duty determination
which is reviewable . . . by the Court of International Trade Under section 516A(a) of the Tariff
Act of 1930.”
Id.
 at § 1581(i); see also Shinyei Corp. of Am. v. United States,
355 F.3d 1297
(Fed. Cir. 2004).
       3
         “The Court of International Trade shall have exclusive jurisdiction of any civil action
commenced under section 516A of the Tariff Act of 1930.”
28 U.S.C. § 1581
(c) (relating to
reviews of certain determinations by Commerce, including administrative reviews of
antidumping duty orders).
Court No. 10-00353                                                                                Page 5


under
28 U.S.C. § 1581
(i). Miller & Co. v. United States,
824 F.2d 961, 963
 (Fed. Cir. 1987). If

instead the error is in the Liquidation Instructions, as indicated jurisdiction will lie under
28 U.S.C. § 1581
(i), and this action would be timely, as liquidation is just now commencing. See

Consol. Bearings Co. v. United States,
348 F.3d 997
, 1002 03 (Fed. Cir. 2003); Shinyei,
355 F.3d at 1312
. There is also a possibility that Customs made a decision which is incorrect under

the Liquidation Instructions, in which case jurisdiction may eventually lie under
28 U.S.C. § 1581
(a) (protest denial jurisdiction). Jurisdictional facts are unclear, but it appears
28 U.S.C. § 1581
(i) jurisdiction is likely, as the Final Results do not seem to lead to the assessment rate

proposed by the United States for the entries at issue.

                                          DISCUSSION

               First, there is a strong possibility that liquidation will foreclose plaintiff’s

remedies. If the error would have been correctable under
28 U.S.C. § 1581
(i) but liquidation is

not enjoined, it is not clear that the liquidation may be overturned. See Am. Signature, Inc. v.

United States,
598 F.3d 816, 829
 (Fed. Cir. 2010) (“ASI”) (citing Ugine & Alz Belgium v.

United States,
452 F.3d 1289, 1297
 (Fed. Cir. 2006)). Further, the jurisdictional facts which

might establish
28 U.S.C. § 1581
(a) jurisdiction, under which reliquidation may be ordered, have

not been established. In such an uncertain situation, preservation of remedies is to be favored.

See ASI,
598 F.3d at 828
 30. Thus, plaintiff has satisfied the requirement to show irreparable

harm.

               Second, there is a likelihood of success on the merits or, at least, a very substantial

question. As conceded by the Government counsel, most if not all of the entries at issue
Court No. 10-00353                                                                            Page 6


involved sales which formed the bases for Commerce’s customer specific rates for the involved

manufacturers. The Final Results refer to the manufacturers under a listing for

“manufacturers/exporters,” Final Results, 75 Fed. Reg. at 38,981, not just to “exporters,” as do

the Liquidation Instructions, Admin. R. 1096, 1102. While the “customers” information seems

to match, the Liquidation Instructions do not appear to fully reflect the Final Results. Compare

Final Results, 75 Fed. Reg. at 38,981, with Admin. R. 1096, 1102. At the very least there is

ambiguity as to what “customer” is supposed to designate. This situation requires a halt to

liquidation to resolve pending issues of law and fact.

               Third, the balance of hardships favor Target. There seem to be no reason to

believe that the United States will be deprived of anything if liquidation is enjoined, while Target

may be in an irremediable situation without preliminary relief. See ASI,
598 F.3d at 829
.

               Finally, the public interest is served by permitting a full examination of the facts

and law. See ASI,
598 F.3d at 830
.

                                         CONCLUSION

               The motion for preliminary injunction is granted and the parties shall submit a

scheduling order by December 30, 2010.




                                                         /s/ Jane A. Restani
                                                             Jane A. Restani
                                                                 Judge
Dated: This 23rd day of December, 2010.
       New York, New York.