Justia Commercial Law Opinion Summaries

The Tariff Act of 1930 permits the Department of Commerce to impose two types of duties on imports that injure domestic industries: antidumping duties on goods sold in the U.S. "at less than ... fair value,” 19 U.S.C. 1673 and countervailing duties on goods that receive “a countervailable subsidy” from a foreign government, 1671(a). Commerce has long collected both types of duties from market economy importers. In 2012, Congress enacted legislation that overruled the Federal Circuit’s 2011 decision, GPXI, and permitted imposition of both antidumping and countervailing duties with respect to importers from non-market economy (NME) countries. Because this law is retroactive and does not require Commerce to adjust for any double counting that may result from the retroactive imposition of both countervailing and antidumping duties, Wireking, an importer affected by the change, claimed that it violated the Ex Post Facto Clause of Article I, Section 9 of the U.S. Constitution. The Court of International Trade upheld the new law. The Federal Circuit affirmed. Wireking did not show that the absence of a retrospective double-counting provision negates the law’s predominantly remedial impact. The 2012 law is not punitive and does not violate the Ex Post Facto Clause. View "Guangdong Wireking Housewares v. United States" on Justia Law

Williams Alaska Petroleum owned and operated a refinery, which ConocoPhillips Alaska supplied with crude oil. ConocoPhillips demanded that Williams tender a payment of $31 million as adequate assurances of Williams’s ability to perform if an ongoing administrative rate-making process resulted in a large retroactive increase in payments that Williams would owe ConocoPhillips under the Exchange Agreement. ConocoPhillips offered to credit Williams with a certain rate of interest on that principal payment against a future retroactive invoice. Williams transferred the principal of $31 million but demanded, among other terms, credit corresponding to a higher rate of interest. Williams stated that acceptance and retention of the funds would constitute acceptance of all of its terms. ConocoPhillips received and retained the funds, rejecting only one particular term in Williams’s latest offer but remaining silent as to which rate of interest would apply. Years later, after the conclusion of the regulatory process, ConocoPhillips invoiced Williams retroactively pursuant to their agreement. ConocoPhillips credited Williams for the $31 million principal already paid as well as $5 million in interest calculated using the lower of the two interest rates. Williams sued ConocoPhillips, arguing that a contract had been formed for the higher rate of interest and that it was therefore owed a credit for $10 million in interest on the $31 million principal. The superior court initially ruled for Williams, concluding that a contract for the higher rate of interest had formed under the Uniform Commercial Code when ConocoPhillips retained the $31 million while rejecting one offered term but voiced no objection to Williams’s specified interest term. On reconsideration, the superior court again ruled for Williams, this time determining that a contract for the higher rate of interest had formed based on the behavior of the parties after negotiation under the UCC, or, in the alternative, that Williams was entitled to a credit for a different, third rate of interest in quantum meruit. The superior court also ruled in favor of Williams on all issues related to attorney’s fees and court costs. ConocoPhillips and Williams both appealed. Upon review, the Supreme Court concluded that the superior court was right the first time and that the parties entered into a contract for the higher rate of interest under the UCC. View "ConocoPhillips Alaska, Inc. v. Williams Alaska Petroleum, Inc." on Justia Law

In 2003, pursuant to a petition by U.S. furniture manufacturers and labor unions, the Department of Commerce initiated an antidumping investigation of Chinese wooden bedroom furniture manufacturers. The International Trade Commission (ITC) investigated whether the domestic industry had been materially injured and distributed questionnaires to all known domestic wooden bedroom furniture producers. Producers are required by law to respond. One question asked, “Do you support or oppose the petition?” and gave the choices: “Support,” “Oppose,” or “Take no position.” Ashley answered “Oppose;” Ethan Allen answered “Take no position.” The ITC issued an antidumping duty order. Commerce directed U.S. Customs to collect duties on entries of Chinese wooden bedroom furniture. The ITC prepared a list of Affected Domestic Producers eligible to receive a share of the duties, 19 U.S.C. 1675c(a), (d)(1) (Byrd Amendment). The ITC did not include Ashley and Ethan Allen, who sued. The Byrd Amendment has been repealed;t they sought their share from prior years. The Court of International Trade dismissed. The Federal Circuit affirmed, stating that “this framework may create incentives for domestic producers to indicate support for a petition even when they may believe that an antidumping duty order is unwarranted, it is not our task to pass on Congress’s wisdom in enacting the Byrd Amendment.”View "Ashley Furniture Indus., Inc. v. United States" on Justia Law

Itochu asked the U.S. Department of Commerce to act under 19 U.S.C. 1675(b) to revoke part of an antidumping-duty order applicable to imported steel nails. Before Commerce issued its preliminary determination, Itochu submitted comments and provided legal authority to urge that the requested partial revocation take effect at an early specified date. Commerce rejected that position in its preliminary ruling and generally invited interested parties to comment. Itochu did not avail itself of that opportunity. In its final ruling, Commerce adopted the partial revocation, which the domestic industry did not oppose, but with the later effective date. When Itochu challenged the effective-date determination, the U.S.s Court of International Trade declined to address the merits, citing failure to exhaust administrative remedies, 28 U.S.C. 2637(d), because Itochu had failed to resubmit, after the preliminary ruling, the comments it had submitted earlier. The Federal Circuit reversed, stating that in these circumstances, requiring exhaustion served no discernible practical purpose and resulting delay would have risked harm to Itochu. View "Itochu Bldg. Prods. v. United States" on Justia Law

Beginning in 2007, Mississippi Valley agreed to sell cattle to Swift, planning to fulfill that agreement in part with cattle it had received from J&R. Mississippi Valley was merely the holder of J&R’s cattle, not the purchaser or owner. Because the relationship between Swift and J&R had soured, Mississippi Valley did not inform Swift that some of the cattle were actually J&R’s. Swift paid for the purchases with checks made out to Mississippi Valley, which deposited the checks in its general operating account and periodically sent J&R checks for sales of J&R cattle. Mississippi Valley stopped making timely payments. As the debt mounted, J&R sent increasingly frantic demands for payment. Mississippi Valley sent seven checks to J&R totaling $862,747.31. Less than 90 days later, creditors filed an involuntary Chapter 7 bankruptcy petition against Mississippi Valley. The bankruptcy trustee sought to avoid the seven payments as preferential transfers, 11 U.S.C. 547(b), but J&R argued that Mississippi Valley never had a property interest in the funds but only held the sale proceeds for J&R’s benefit. The bankruptcy court granted J&R summary judgment. The district court affirmed. The Seventh Circuit remanded, stating that it is unclear how much money could properly be traced to a constructive trust in favor of J&R.View "In re: MS Livestock, Inc." on Justia Law

Baxter’s Colleague Infusion Pump, an electronic device used to deliver intravenous fluids to patients, was known to have a range of defects. The FDA sent Baxter warning letters. Baxter’s response was not satisfactory. In 2005 the FDA sought forfeiture of all Baxter‐owned Pumps. In 2006, Baxter entered into a Consent Decree to stop manufacturing and distributing all models of the Pump within the U.S., and committed to bringing the approximately 200,000 Pumps in the hands of health care professionals into compliance with the FDA Act. Baxter devoted significant resources to fixing the Pumps, but the FDA was not satisfied and ordered a product recall. In a derivative suit, plaintiffs alleged that that Baxter’s directors and officers breached fiduciary duties by consciously disregarding their responsibility to bring about compliance with the Consent Decree, causing Baxter to lose more than $550 million. Plaintiffs did not first ask Baxter’s board of directors to pursue those claims, but alleged futility. The district court dismissed, finding that Westmoreland failed adequately to plead demand futility, as required by FRCP 23.1(b)(3) and Delaware substantive law. The Seventh Circuit reversed, stating that particularized facts furnished by plaintiffs cast a reasonable doubt that the defendants’ conduct was the product of a valid exercise of business judgment. View "Westmoreland Cnty. Emps. Retirement Sys. v. Parkinson" on Justia Law

Frey has owned the Peoria commercial property, which contains a shopping center, for more than 40 years, without prior incident. In 2009, a tenant, ShopRite, was found to be illegally selling Viagra without a licensed pharmacist. The city took legal action against Patel (the franchisee) personally, and the business, then revoked the liquor license for the store and “site approval for the retail sale of alcoholic liquors at the location.” Frey asserted due process violations. The district court and Seventh Circuit rejected the claims. Frey did not adequately explain a substantive due process claim and had no property right such that it was entitled to any process at all before revocation of its site approval, but Frey nonetheless received due process of law before the Peoria Liquor Commission.View "Frey Corp. v. City of Peoria" on Justia Law

In 2005, the Department of Commerce issued an antidumping duty order on wooden bedroom furniture from China; importers who were not individually investigated are required to post a deposit at a country-wide rate of 216.01%. Marvin, a Chinese furniture producer and exporter, did not export subject merchandise during the investigation period. In 2011, Marvin requested new shipper review to obtain an individual rate and avoid the country-wide rate. Based on U.S. Customs and Border Protection data, Commerce determined that Marvin’s exports had entered the U.S. in 2010. Marvin explained that the entries contained only non-subject merchandise samples for a trade show with no offers for sale. Commerce accepted Marvin’s explanation and initiated new shipper review covering Marvin’s exports entered from January 1 through June 30, 2011. Marvin later submitted information that the 2010 entries included some subject merchandise, entered for consumption, contrary to its initial request. In 2012, Commerce preliminarily rescinded Marvin’s new shipper review. Marvin argued harmless and unintentional error that did not affect new shipper review eligibility. Commerce finalized the rescission, citing19 C.F.R. 351.214(b)(2)(iv)(A) and (B). The Trade Court affirmed, holding that 19 U.S.C. 1677m, which allows a party to correct filings, was inapplicable because Marvin’s request for a new shipper review was not filed in “response to a request for information” under the statute. The Federal Circuit affirmed. View "Marvin Furniture Co., Ltd. v. United States" on Justia Law

Sam’s Club is a members-only retail warehouse that features a section for clearance items, called “as-is” items. Items may be designated “as-is” for various reasons and may be damaged or undamaged. Every as-is item is marked with an orange sticker; when a cashier scans the item, the original price appears and the cashier must perform a manual override. The software records the fact that a price override was performed, but does not include the reason. Overrides can occur for reasons other than “as-is” designation. Sam’s contracted with NEW to sell extended warranties for items sold in the store. NEW will not cover some “as is” products, including some purchased by Hayes. On each occasion, Sam’s employees offered and Hayes purchased a NEW warranty. The store provided Hayes with a manual and remote missing from a television he purchased and offered to refund the warranty price. Hayes declined. Hayes sued, on behalf of himself and all other persons who purchased a warranty for an as-is product from Clubs in New Jersey since 2004, asserting violation of the state Consumer Fraud Act, breach of contract, and unjust enrichment. The trial court certified a Rule 23(b)(3) class. The Third Circuit vacated and remanded for consideration of Rule 23’s class definition, ascertainability, and numerosity requirements in light of a recent decision. View "Hayes v. WalMart Stores Inc" on Justia Law

The Halims own named WR Property Management. The company’s predecessor had contracted to buy natural gas from CES for the Halims’s 41 Chicago-area rental properties. CES delivered, but the company stopped paying and owed about $1.2 million when CES cut off service and filed suit. An Illinois court awarded $1.7 million, including interest and attorney fees. The company did not pay; the Halims had transferred all of its assets to WR. CES filed a diversity suit under the Illinois Fraudulent Transfer Act. The district court granted CES summary judgment and entered a final judgment for $2.7 million on fraudulent‐conveyance and successor‐liability claims. The Seventh Circuit affirmed, stating: “If the Halims are wise, they will start heeding the adage: if you’re in a hole, stop digging.” View "Centerpoint Energy Servs., Inc. v. WR Prop. Mgmt., LLC" on Justia Law