CIT Says Commerce Failed to Define Term 'Bona Fide Wholesaler'

Judge Timothy Stanceu held that Commerce failed to define the term "'bona fide' wholesaler," and as a result "provided no convincing explanation of why Luscious Seafood did not qualify as one." The judge added that the agency improperly concluded that Luscious didn't provide requested information, that the company's responses "contained inconsistences" regarding the "timing of initial activities and personnel involved in its operations," and that Luscious "mischaracterized its relationship with another company."

In 2022, Luscious requested an administrative review of all known Vietnamese exporters and producers under the AD order on Vietnamese frozen fish fillets for the 2021-22 review period. Commerce concluded Luscious didn't have standing to request the review, since it wasn't a "bona fide" wholesaler of the domestic like product given that it didn't make a bona fide sale of the product during the review period.

In the review, Commerce picked two mandatory respondents and assigned the non-individually examined respondents a $0.18 per kilogram dumping rate. The agency then rescinded the review for all Vietnamese exporters only covered by Luscious' petition. The seafood seller filed suit, arguing that it's a "bona fide" wholesaler of the domestic like product (see 2512160033).

Stanceu sided with Luscious, first finding that Commerce failed to define the term bona fide wholesaler. The judge said the Latin translation of bona fide is "good faith," noting that the agency didn't "point to, or base its decision on, record evidence that Luscious Seafood’s business transactions" were "fraudulent, deceitful, or otherwise made on false pretense." Thus, Commerce's decision lacks reasoning under which Luscious' business transactions during the review period "were not made in good faith," the decision said.

Instead, Commerce based on its decision on various criteria, including "the company’s limited history and timing of its establishment, the limited number of transactions during the [review period], and the extent to which those limited transactions reflected a commercially reasonable and sustainable business activity." The agency emphasized that Luscious made only one unprofitable sale to a retailer during the review period.

The trade court found two issues with Commerce's analysis. First, these factors don't relate to whether the transaction was made in "good faith" but to "how well-established Luscious Seafood was as an enterprise during the" review period. Second, the factors the agency used are the statutory factors used to identify a party that qualifies for a "new shipper" review. Here, Luscious isn't seeking an individual AD rate for itself but "instead claims a need for protection from unfairly traded imports," Stanceu said. Thus, Commerce failed to explain why the new shipper review factors should apply here, the court held.

Commerce also said Luscious didn't provide the agency with requested information pertaining to banking and business documents and U.S. government licensing and registration filings. Stanceu held that the agency's conclusion isn't supported by the record, since Commerce didn't account for or respond to the company's responses for why it didn't provide certain information. For instance, while the agency requested the company's business license, Luscious explained that it requested a copy of its license but hadn't received it yet.

Commerce also noted that Luscious' responses "contained inconsistences" regarding the timing of its initial activities and personnel involved in its operations. Specifically, the agency noted that Luscious once said its selling operations began in 2022 despite previously reporting that they began in 2021. Regarding Luscious' personnel, Commerce noted that the name of the company's sole owner as reported by the company was different than the one identified as the billing contact on a shipping invoice.

Regarding both of these "inconsistencies," Stanceu faulted Commerce for failing to raise them with the company itself. The agency "gave Luscious Seafood no opportunity to address these issues before denying it standing," the decision said.

Lastly, Commerce denied Luscious standing on the basis that it mischaracterized its relationship with one of its suppliers. The agency noted that Luscious reported that it didn't have a relationship with the supplier, yet the supplier was owned by Luscious' owner's stepfather.

Stanceu held that Commerce failed to support its finding that Luscious "mischaracterized" this relationship. The judge based this holding on the fact that Luscious disclosed the personal relationship between the owners of Luscious and the supplier, and the fact that the relationship was with Luscious' owner and wasn't a "relationship of the corporate entity itself."

Turning to the issue of remedy, the court noted that Luscious asked for a remand to have Commerce reconsider the AD rate for the Vietnam-wide entity. However, Stanceu said he won't order the agency to review this rate, since Luscious only challenged Commerce's standing determination and didn't challenge the agency's mandatory respondent selections.

The court said it will only order Commerce to reconsider the decision to deny Luscious standing to request the review, adding that if the agency finds the company did have standing, it should "identify those exporters and producers that were not individually examined and that would receive the separate rate should the Remand Redetermination be sustained."

(Luscious Seafood v. United States, Slip Op. 25-153, CIT # 24-00069, dated 01/06/26; Judge: Timothy Stanceu; Attorneys: Camelia Mazard of Doyle Barlow for plaintiff Luscious Seafood; Collin Mathias for defendant U.S. government; Jonathan Freed of Trade Pacific for defendant-intervenors Bien Dong Seafood Company and NTSF Seafoods Joint Stock Company; Nazak Nikakhtar of Wiley Rein for defendant-intervenors led by Catfish Farmers of America)