On January 27, 2021, the U.S. Court of International Trade (CIT) issued an opinion in which it dismissed all but one claim challenging on various grounds a proclamation by former President Donald Trump (Proclamation 9980) that imposed 25% tariffs on, inter alia, various imported products made of steel pursuant to Section 232 of the Trade Expansion Act of 1962. However, the CIT will continue to consider the claim that President Trump implemented additional and new duties on certain steel derivative products after the statutory time period for such action had lapsed.
PrimeSource Building Products, Inc., a U.S. importer of various steel derivative products, filed a complaint (subsequently amended) in the CIT on February 4, 2020, arguing that President Trump’s Proclamation 9980 was unlawful and unconstitutional. See Update of February 14, 2020. On March 20, 2020, the U.S. Department of Justice (DOJ) filed a motion to dismiss the complaint, arguing that the new tariffs did not violate the Section 232 procedural requirements or PrimeSource’s right to due process. See Update of March 31, 2020.
In its January 27, 2021 order, the CIT dismissed PrimeSource’s claims that: (i) the imposition of Section 232 duties on the derivative products was procedurally deficient; (ii) the secretary of commerce violated all of the Section 232 statutory provisions; (iii) PrimeSource was deprived of its Fifth Amendment due process constitutional rights; and (iv) Section 232 is unconstitutional as it unlawfully delegates legislative authority from Congress to the president.
The CIT did not dismiss PrimeSource’s claim that Proclamation 9980 was issued 638 days after the transmittal of the Section 232 steel investigation report to the president (well after the 105 days set forth in 19 U.S.C. § 1862(c)(1)) and is thus null and void. Despite DOJ arguing that the president has the authority to modify Section 232 tariffs at any time to protect national security (including adjusting imports of articles not addressed in Proclamation 9705 that the president designated as “derivatives” of identified steel articles), the CIT found that this claim rests upon a “plain meaning” interpretation of the statute. The opinion states that DOJ’s “’flexible’ reading of [19 U.S.C. § 1862(c)(1)] would require us to interpret the ‘action’ taken by Proclamation 9980 and that taken by Proclamation 9705 as parts of the same ‘action’,” which “presents several interpretive problems.” The opinion concludes that there “is no ‘flexible’ reading of [19 U.S.C. § 1862(c)(1)] Section 232(c)(1) that suffices to allow the President to adjust, through new tariffs, imports of derivatives of previously-affected articles outside of the time limits Congress imposed, and the appellate decisions on which defendants rely do not lend support to any such reading.”
The parties now have until February 26, 2021, to file a joint schedule that will govern the briefing and hearing schedule for the remaining “unresolved factual issues” of this claim.