CIT Orders ITA to Consider Untimely Fraud Allegation in 2009-10 China Pure Magnesium AD Review
The Court of International Trade remanded the final results of the final results of the 2009-10 antidumping duty administrative review of pure magnesium from China (A-570-864), because the International Trade Administration improperly rejected a late submission alleging fraud. While the ITA has the power to enforce its deadlines, CIT said, fraud allegations are a special circumstance. CIT also remanded for further consideration the ITA’s selection of three surrogate values, including two on voluntary remand.
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Respondent Tianjin Magnesium International (TMI) imported magnesium into the U.S. that was produced by another Chinese company. During the review, TMI said its supplier produced the magnesium using rented steel “retorts,” which are a factory component used to purify magnesium. As such, the ITA classified the retorts as indirect inputs, which had the effect of lowering TMI’s AD rate. When domestic party U.S. Magnesium brought evidence after the relevant deadline that TMI’s supplier actually produced the retorts instead of renting them, alleging TMI committed fraud by saying the retorts were rented, the ITA rejected the evidence as untimely. According to the ITA, the evidence was available before the deadline, so U.S. Magnesium had ample time to file a timely submission.
But fraud allegations should be treated differently than other types of submissions when it comes to deadlines, said CIT. Courts have even ordered the reopening of proceedings after they were finalized to consider allegations of fraud, it said. “Because of this single-minded focus” on the availability of the evidence to U.S. Magnesium before the deadline, the ITA “overlooked the possibility that TMI deliberately failed to report information to which it also clearly had access,” CIT said. If the ITA would have considered the fraud allegations and found them to be true, the ITA may have decided to classify the retorts as a direct input, meaning a higher AD rate for TMI.
(US Magnesium, LLC v. United States, Slip Op. 13-09, dated 01/22/12, Judge Tsoucalas)
(Attorneys: Stephen Jones of King & Spalding for plaintiff U.S. Magnesium; Stuart Delery for defendant U.S. government; David Riggle of Riggle & Craven for defendant-intervenor TMI)