Justia Commercial Law Opinion Summaries

In 2010, at the request of domestic interested parties, the Department of Commerce initiated review under 19 U.S.C. 1675(a) on an outstanding antidumping duty order on stainless steel bar from India 2009-2010 and issued Mukand questionnaires to obtain product-specific cost information necessary to calculate Mukand’s dumping margin and ensure that comparison of similar products. Mukand’s response assigned the same production costs across all product sizes. Commerce informed Mukand that it did not consider this approach reasonable and asked that Mukand produce size-specific information, regardless of whether it normally tracked such information or to “quantify and explain” any reasons for believing that size-based cost differentials are insignificant. Mukand responded with a brief statement that where product grade and type of finishing operation are the same, direct material costs do not vary with size. After a fourth questionnaire, Mukand still declined to report size-specific costs, but never contacted Commerce for clarification or assistance. Commerce determined that Mukand’s responses were deficient, resorted to facts otherwise available, and applied an adverse inference against Mukand. The Court of International Trade and Federal Circuit affirmed. Without cost data broken down by product size, Commerce was unable to differentiate between different types of steel bar products and could not calculate an accurate constructed value for any of Mukand’s products. View "Mukand, Ltd. v. United States" on Justia Law

Trek was the importer of record for 72 entries of men’s suits in 2004. Mercantile was the consignee. Shadadpuri is president and sole shareholder of Trek, and a 40% shareholder of Mercantile. Trek and Mercantile provided fabric “assists” to manufacturers outside the U. S. (items incorporated in the imported merchandise, 19 U.S.C. 1401a(h)(1)(A)(i)). Customs determined that the entry documentation failed to include the cost of the fabric assists in the price paid for the suits which lowered the amount of duty payable by Trek. Shadadpuri had previously failed to include assists in entry declarations when acting on behalf of a corporate importer. The Court of International Trade found Shadadpuri liable for gross negligence in connection with the entry of imported merchandise and imposed penalties under 19 U.S.C. 1592(c)(2). The Federal Circuit reversed the penalty, but, on rehearing en banc, affirmed. What Shadadpuri did comes within the commonsense understanding of the “introduce” language of the statute. While suits invoiced to one company were in transit, he “caused the shipments of the imported merchandise to be transferred” to Trek. Himself and through his aides, he sent invoices to the customs broker for use in completing the entry filings to secure release of the merchandise into U.S. commerce. Applying the statute to Shadadpuri does not require piercing the corporate veil. View "United States v. Trek Leather, Inc." on Justia Law

CPZ imported tapered roller bearings by selling them to an unaffiliated U.S. importer, which then sold them to CPZ’s U.S. affiliate which resold them to unaffiliated U.S. customers. The Department of Commerce requested that CPZ identify whether its sales were export price (EP) sales or constructed export price (CEP) sales for purposes of calculating CPZ’s antidumping duty margin. CPZ provided CEP data. It did not provide EP data. Timken, an intervening domestic bearing producer, urged Commerce to calculate CPZ’s margin on an EP basis. Commerce did not require CPZ to submit the EP data, but calculated CPZ’s margin on a CEP basis, using the data provided. After Commerce issued the Preliminary Results, Timken again submitted comments. In its Final Results, Commerce changed course and calculated CPZ’s margin on an EP basis, using limited EP data previously provided, relating to a small subset of the imported bearings. Commerce calculated a margin of 92.84%. The Court of International Trade remanded. On remand, Commerce twice requested EP data. CPZ responded that it had been sold and the new owners had not maintained that data. After a second remand, under protest, Commerce calculated a 6.52% margin using the CEP data, without applying adverse facts available. The Court of International Trade affirmed. The Federal Circuit vacated. Commerce’s application of adverse facts available in its First Remand Redetermination was supported by substantial evidence; the Trade Court should reinstate Commerce’s application of adverse facts available and its calculation of CPZ’s margin in its First Remand Redetermination. View "Peer Bearing Co. - Changshan v. United States" on Justia Law

The Department of Commerce sets cash deposit rates associated with imported goods to curb “dumping,” i.e., exporting goods far below typical market prices, 19 U.S.C. 1673e(a)(3). Commerce found that a U.S. industry was threatened with material injury by reason of imports of certain cased pencils from China, imposed anti-dumping duties, and later initiated administrative reviews for 2008-2009 and 2009-2010. During the 2008-2009 review period, Michaels imported cased pencils manufactured by three producers in China and exported by three different exporters. The producers participated in the review process, but two withdrew. None of the Chinese exporters participated. The producers’ rates were established for the two review periods. Commerce assigned Michaels’ exporters a country-wide anti-dumping cash deposit rate, as opposed to lower rates obtained by the pencils’ producers. Michaels argued that it was entitled to the producer rate based on 19 C.F.R. 351.107(b)(2), which states that “if the Secretary has not established previously a combination cash deposit rate . . . for the exporter and producer in question or a noncombination rate for the exporter in question, the Secretary will apply the cash deposit rate established for the producer.” The Federal Circuit affirmed, reasoning that section 351.107(b)(2) is informed by section 351.107(d), which establishes an initial noncombination rate for all producers and exporters in nonmarket economy countries. View "Michaels Stores, Inc. v. United States" on Justia Law

The Department of Commerce conducted new shipper review, at Sea-line’s request, on an outstanding 1994 antidumping order on fresh garlic imports from China. New shipper review covers an importer or producer that was not subject to an initial antidumping duty investigation and thinks it is entitled to an individual anti-dumping duty margin, 19 U.S.C. 1675(a)(2), and covers imports after the review period for the initial investigation. Commerce conducted Sea-line’s review for the period of November 1, 2008 through April 30, 2009. Because China is a non-market economy, Commerce used surrogate values from a comparable market economy (India), relying on price data from the APMC Bulletin, which reports daily prices in India for garlic bulbs of various “grades.” Sea-line reported bulbs in the grade Super A category. The APMC Bulletin did not report any prices for grade Super A bulbs for the period of review. Commerce averaged the closest available data points for grade Super A garlic, which was for November 2007 through April 2008 and applied the Wholesale Price Index for India published by the International Monetary Fund. Commerce calculated a “surrogate financial ratio” for general expenses, overhead, and profit by averaging financial statements of two Indian tea producers, reasoning that "tea, rice, and vegetable processing is similar to garlic because each is not highly processed or preserved prior to sale.” The Court of International Trade affirmed the final results and assignment of an antidumping duty. The Federal Circuit affirmed, finding that the results were based on substantial evidence.View "Qingdao Sea-line Trading Co. v. United States" on Justia Law

Between 2009 and 2012, Sunshine and Purdy, a Kentucky dairy farmer, entered into “Dairy Cow Leases.” Purdy received 435 cows to milk, and, in exchange, paid monthly rent to Sunshine. Purdy’s business faltered in 2012, and he sought bankruptcy protection. Sunshine moved to retake possession of the cattle. Citizens First Bank had a perfected purchase money security interest in Purdy’s equipment, farm products, and livestock, and claimed that its perfected security interest gave Citizens First priority over Sunshine with regard to the cattle. Citizens argued that the “leases” were disguised security agreements, that Purdy actually owned the cattle, and that the subsequently-acquired livestock were covered by the bank’s security interest. The bankruptcy court ruled in favor of Citizens, finding that the leases were per se security agreements. The Sixth Circuit reversed, noting that the terms of the agreements expressly preserve Sunshine’s ability to recover the cattle. Whether the parties strictly adhered to the terms of these leases is irrelevant to determining whether the agreements were true leases or disguised security agreements. Neither the bankruptcy court nor the parties sufficiently explained the legal import of Purdy’s culling practices or put forward any evidence that the parties altered the terms of the leases making them anything but leases. View "In re: Purdy" on Justia Law

Plaintiff is the marketer, distributor, and seller of 5-hour ENERGY (FHE), an “energy shot,” which is an energy drink sold and consumed in small portions. Plaintiff began selling FHE in 2004. FHE was not the first energy shot on the market, but was the first to achieve widespread success and was unique in being marketed FHE to adults as a replacement for an afternoon cup of coffee or a caffeinated soda. Plaintiff submitted “5-hour ENERGY” for trademark registration with the Patent and Trademark Office, which rejected the application in January 2005, deeming the mark too descriptive to be eligible for protection. Plaintiff placed FHE on the Supplemental Register in September 2005 and secured a trademark for “5-hour ENERGY” in August 2011. Plaintiff also protected its mark and market position through litigation. Defendants have marketed dietary supplements since the mid-1990s. In 2008, defendants began to market and sell “6 Hour Energy Shot,” in a bottle resembling the FHE bottle. In a suit under the Lanham Act, 15 U.S.C. 1051, the district court found infringement of plaintiff’s trademark and trade dress, then entered an order of contempt after the defendants violated a permanent injunction entered. The Sixth Circuit affirmed.View "Innovation Ventures, LLC v. N2G Distrib., Inc." on Justia Law

GRK’s R4 Screws, RT Composite Trim Head Screws, and Fin/Trim Head Screws are made with corrosion-resistant case-hardened steel and are marketed for use as building material fasteners. R4 screws have a flat self- countersinking head designed to cut away at the top layer of the material as the screw is driven into place. RT and Fin/Trim screws are recommended for fine carpentry and trim applications, and have much smaller heads, designed to prevent cracking and splitting of the target material. GRK imported the subject screws between January and August 2008. U.S. Customs and Border Protection classified the screws at liquidation under the Harmonized Tariff Schedule of the U.S. (HTSUS) subheading 7318.12.00, “other wood screws,” which carries a 12.5% ad valorem duty. GRK protested, claiming that the screws should instead have been classified under subheading 7318.14.10, “self-tapping screws,” subject to a 6.2% ad valorem duty. Customs denied GRK’s protests. The Court of International Trade noted that HTSUS does not specifically define either subheading and agreed with GRK that the items were properly classified as “self-tapping screws.” The Federal Circuit vacated and remanded, reasoning that the Trade Court refused to consider the use of the screws at any step of determining the classification. View "GRK Canada, Ltd. v. United States" on Justia Law

Plaintiff-school opened a bank account for its operating fund with Defendant-bank. One of Plaintiff’s employees later opened a bank account with Defendant that Plaintiff had not authorized and deposited into that account several hundred checks originating from, or intended to be deposited into, Plaintiff’s bank account with Defendant. Over the course of approximately four years, the employee deposited $832,776 into this bank account and withdrew funds just short of that amount. Defendant refused Plaintiff’s demand to return the funds that the employee had funneled through this account to himself. Thereafter, Plaintiff commenced this action, alleging breach of contract, violations of the Uniform Commercial Code (UCC), negligence, and common law conversion. The trial court rendered judgment in favor of Plaintiff on each of the counts and awarded $832,776 in total compensatory damages. The Supreme Court affirmed in all respects with the exception of the damages award, holding that some of Plaintiff’s claims under the UCC were time barred and that the trial court did not otherwise err in its judgment. Remanded with direction to reduce the award by $5,156 and to proportionately reduce prejudgment interest, . View "Saint Bernard Sch. of Montville, Inc. v. Bank of Am. " on Justia Law

Coastal filed suit against Chase Bank, asserting claims of conversion and negligence under the Texas Uniform Commercial Code (UCC) and money had and received under the common law. At issue on interlocutory appeal was whether section 3.405 of the UCC can serve as an affirmative defense to a common law "money and received" claim and whether settlement credits in Texas reduce the nonsettling defendant's liability rather than the plaintiff's total loss. The court concluded that the money had and received claim as applied in this situation must simply incorporate the affirmative defense provided by section 3.405. Therefore, the district court did not err in its determination that section 3.405 could so be applied. Further, the district court was correct in holding that the settlement credit should be applied to reduce the nonsettling defendant's liability, not the plaintiff's total loss. On remand, however, the district court must give Coastal an opportunity to demonstrate that allocation of the settlement amount is appropriate. Accordingly, the court affirmed and remanded for further proceedings. View "Coastal Agricultural Supply v. JP Morgan Chase Bank, N.A." on Justia Law