'Major Questions Doctrine' Does Not to Apply to Section 301 Exclusion Case, US Tells Federal Circuit
The "major questions doctrine" established in the Supreme Court decision West Virginia v. EPA does not apply to the question of whether a protest needed to be filed with CBP to retroactively apply Section 301 duty exclusions, the U.S. argued in an Oct. 28 brief opposing a motion for panel rehearing or rehearing en banc at the U.S. Court of Appeals for the Federal Circuit. Even if the major questions doctrine did apply, CBP acted in line with the clear authority granted by Congress in collecting Section 301 duties from plaintiff-appellants ARP Materials and Harrison Steel Castings, the brief said (ARP Materials v. United States, Fed. Cir. #21-2176).
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The Federal Circuit ruled in the case that the Court of International Trade was right to dismiss ARP's and Harrison's case for lack of subject matter jurisdiction since a protest was not filed. The trade court said that it didn't have jurisdiction under Section 1581(i), the court's "residual" jurisdiction, since the court would have had jurisdiction under Section 1581(a) had the importers filed protests with CBP. The Federal Circuit agreed, holding that the true nature of the suit contests CBP's assessment of the duties and not the Office of the U.S. Trade Representative's exclusions, necessitating a protest (see 2209060035).
ARP and Harrison filed for rehearing, arguing that the West Virginia decision was not considered and that the U.S. Supreme Court decision is relevant to the present action. In this SCOTUS decision, the nation's top court curbed the EPA's ability to carry out certain agency actions since it was based on an authority rooted in vague language of a rarely used gap filler in the statute that transformed the agency's authority, the brief said. The opinion invoked the major questions doctrine as well, which says that federal agencies need clear instructions from Congress to tackle issues related to a "fundamental sector of the economy."
In its reply to the rehearing bid, the U.S. said that the major questions doctrine, and by extension the West Virginia decision, are not applicable to the present case. Not only was this doctrine not brought before the trade court or the Federal Circuit panel, the doctrine only applies to cases steeped in major policy decisions of vast political significance, the government said. In the ARP/Harrison affair, CBP did not put forth any new rules nor transform its regulatory authority or use a rarely-used statute meant as a gap filler in administering the Section 301 refunds, DOJ argued. "Rather, it relied on longstanding authority delegated by Congress in 'exactly the scenario in which [Section] 1514’s protest provisions can be invoked,'" the brief said.
The U.S. said that the appellants "conflate the issuing of Section 301 duties and exclusions with CBP’s administration of duty refunds," and thus exaggerate the case's implications on foreign relations and international trade. "In short, the administration of Section 301 duties is not an 'extraordinary' case warranting departure from bedrock principles of statutory interpretation in order to apply the major questions doctrine," the brief said. Even if it was, the government said CBP acted under its clear authority as granted by Congress.
The appellants also put forth a handful of other arguments in their bid for rehearing, including claims that the U.S. and the appellate court misapprehended the case's "true nature," that USTR "abrogated its responsibilities by letting CBP substitute its power for USTR's own," and that the panel "failed to consider two cases that appellants had never cited," the U.S. said. The government argued that most of these claims were never put forth before the trade court nor the panel "and should be deemed waived."
As for the question of whether USTR's handed off its authority, the government argued that the Federal Circuit's opinion shows that it understands both CBP's and USTR's authority. Nothing in USTR's "enabling statute" disrupts CBP's de jure authority to make classification decisions, the U.S. said. "Appellants have failed to explain why the Panel’s interpretation of the relevant statutory provisions, which 'prevent[s] usurpation of the protest scheme Congress crafted' should be disturbed based upon appellants’ belated citation to 19 U.S.C. § 2171(f)," the brief said.