Amicus Curiae Brief — USEC, Inc. v. Eurodif S.A. (Nos. 07-1078, 07-1059)

- !

Nos. 07-1059, 07-1078 FILED

; MAR 1? 2008

N THE

Supreme Court of the Unite’) Sep RE THs. SHEAK

UNITED STATES OF AMERICA,

Petitioner,

v.

EURODIF S.A.

Respondent.

USEC INC. and

UNITED STATES ENRICHMENT CORPORATION,

Petationers,

v

EURODIF S.A.; COMPAGNIE GENERALE DES

MATIERES NUCLEAIRES; COGEMA, INC.;

AD HOC UTILITIES GROUP; and UNITED STATES,

Respondents.

On PETITIONS FOR WRITs OF CERTIORARI TO THE UNITED

SraTes Court OF APPEALS FOR THE FEDERAL CIRCUIT

BRIEF OF THE COMMITTEE TO SUPPORT

U.S. Trave Laws As Amici CuRIAE

IN SUPPORT OF PETITIONERS

Davip A. HARTQUIST

Executive Director of the Committee

to Support U.S. Trade Laws

KELLEY DrreE & WarRREN LLP

3050 K Street, Suite 400

Washington, D.C. 20007

(202) 342-8400

Counsel for Amici Curiae

214723 fc

COUNSE. PRESS

(800) 274-4321 + (SOC) 359-6859

i

TABLE OF CONTENTS

TABLE OF CITED AUTHORITIES .........

INTEREST OF AMICI CURIAE ............

SUMMARY OF ARGUMENT ................

P,P PTPOTT TTT TTT TTT TTT TT TTT Tee

I.

Il.

THE FEDERAL CIRCUIT’S

HOLDING IN EURODIF CREATES A

MAJOR LOOPHOLE UNDERMINING

THE EFFICACY OF THE USS.

Poppi og oS ee

THE FEDERAL CIRCUIT FAILED TO

ACCORD CHEVRON DEFERENCE

TO COMMERCE’S REASONABLE

INTERPRETATION OF THE

ANTIDUMPING STATUTE ...........

Co Bree revere Perret rrr

ti

TABLE OF CITED AUTHORITIES

Page

CASES

Bomont Indus. v. United States,

13 Ct. Int'l Trade 546, 718 F. Supp. 958 (1989)

saGks dee Cobre ehes ess ceed edatas btKebees 12

Chevron, U.S.A., Inc. v. Natural Resources

Defense Council,

GE Wide Be CRED. onc cccsccccccccccees 13, 14,15

Furodif S.A. v. United States,

411 F.3d 1355 (Fed. Cir. 2005), aff’d on reh’g,

423 F:3d 1275 (Fed. Cir. 2005), final judgment,

506 F.3d 1051 (Fed. Cir. 2007) ............. passim

Florida Power & Light Co.. v. United States,

307 F.3d 1364 (Fed. Cir. 2002) ............... 16

Huatyin Foreign Trade Corp. v. United States,

322 F.3d 1369 (Fed. Cir. 2003) ............... 12

Lasko Metal Prods. v. United States,

43 F.3d 1442 (Fed. Cir. 1994) ................ 12

Nat'l Cable & Telecomms. Ass’n v.

Brand X Internet Servs.,

ED ccc cccconcecececece 14, 16,17

7

iii

Cited Authorities

Page

STATUTES

os ace deeekbaabawnun ¢ 7, 8,15

a as eid Wi cubed 8

RR ee 11

LEGISLATIVE HISTORY

S. Rep. No. 249, 96" Cong., 1 Sess. 37 (1979),

reprinted in, 1979 U.S.C.C.A.N. 381, 423 .... 12

1

INTEREST OF AMICI CURIAE

The Amici Curiae in support of the petitions for writs

of certiorari in this case are the Committee to Support U.S.

Trade Laws (“CSUSTU’) and the following companies and

trade associations members of CSUSTL: the American

Iron and Steel Institute, the Coalition for Fair Lumber

Imports Executive Committee, the Cold Finished Steel Bar

Institute, the Copper & Brass Fabricators Council, Inc.,

Corey Steel Company, the Floral Trade Council, Florida

Farmers, Inc., the Kansas Cattlemen’s Association, the

Lake Carriers Association, Lumi-Lite Candle Co., Inc., the

Montana Cattlemen’s Association, Nevada Live Stock

Association, Nevada Committee for Full Statehood, Nucor

Corporation, Steel Manufacturers Association, the

Southern Shrimp Alliance, Specialty Steel Industry of

North America, R-CALF USA, Republic Engineered

Products, South Dakota Stockgrowers Association, and the

Timken Company:.'

In addition to the individual companies and trade

associations identified, another member of CSUSTL on

whose behalf this brief is submitted is the United Steel,

Paper and Forestry, Rubber, Manufacturing, Energy,

Allied-Industrial and Service Workers International

' The parties have consented to the filing of this brief and

their consent letters have been filed with the Clerk. Counsel of

record for all parties received notice at least 10 days prior to the

due date of the Amici Curiae’s intention to file this brief. No

counsel for a party authored this brief in whole or in part, and

no such counsel or party made a monetary contribution intended

to fund the preparation or submission of this brief. No person

other than amici curiae, their members, or their counsel, made

a monetary contribution to its preparation or submission.

“vra

2

Union (“USW”). The USW is the largest industrial union

in North America with 850,000 active members

manufacturing a broad range of goods, including tires,

steel and pharmaceuticals.

The USW has been actively engaged in using the

U.S. trade laws to ensure that its workers and industries

are not lost to unfair import competition.2 The USW

firmly believes, as do the other amici curiae, that the

decision by the Federal Circuit is not only erroneous —

elevating form over substance — but outright dangerous

because it provides a means for foreign manufacturers

to engage in dumping with impunity merely by

restructuring contracts. As noted by the Solicitor

General, the manufacture of goods typically encompasses

manufacturing or processing that could be contracted

for separately in the same manner as Separate Work

Unit (““SWU”) contracts. For example, steel could be

obtained by supplying the iron ore and contracting for

smelting and rolling “services.” * The USW and the other

* In fact, the USW was a petitioner in the antidumping

investigation of uranium products imported from the former

Soviet Union, and represents over 1000 highly-skilled workers

employed at the United States Enrichment Corporation, the sole

U.S. uranium producer. That investigation resulted in a

suspension agreement that is now negatively affected by the

Eurodif decision. The USW is the successor-in-interest in that

distinct matter. The original petition was brought by the Oil,

Chemical and Atomic Workers International Union (“OCAW”)

in 1991. In 1999, the OCAW merged with the United

Paperworkers International Union to form the Paper, Allied-

Industrial, Chemical & Energy Workers International Union

(“PACE”). In 2005, PACE merged with the United Steelworkers

of America (“USWA”) to become the USW.

* Petition of Solicitor General for Writ of Certiorari at 25.

3

Amici Curiae stand ready to compete with fairly-traded

imports from anywhere but cannot and should not be

compelled to compete against dumped imports sold

under the guise of “services.” That is not what the trade

laws intended.

Amici are advocates and beneficiaries of the

antidumping statute and span a wide array of domestic

industries as well as workers. Many of the CSUSTL

individual members have filed petitions and successfully

secured protection against unfair trade. All of the Amici

Curiae are concerned that the U.S. antidumping law be

maintained as a strong and viable remedial tool to

address injurious dumping by imports. As discussed

further in the Argument, the interest of Amici Curiae

in this case stems from the significant loophole in the

antidumping law that would result from the Federal

Circuit’s holding in Eurodif S.A. v. United States, 411

F.3d 1355 (Fed. Cir. 2005), aff’d on reh’g, 423 F.3d 1275

(Fed. Cir. 2005), final judgment, 506 F.3d 1051 (Fed. Cir.

2007). The breadth of the industries and companies that

could be affected by the Federal Circuit’s holding is

expansive.

In sum, CSUSTL and its individual supporting

members identified are highly concerned that the effect

of the appellate court’s holding would essentially permit

injurious dumping to continue unchecked, contrary to

the purpose of the law. Accordingly, CSUSTL and its

individual supporting members have a strong interest

in this matter.

4

SUMMARY OF ARGUMENT

After conferring with the key Administration

agencies involved in international trade and national

defense issues and obtaining their support, the Solicitor

General has for the first time in history asked the

Supreme Court to hear an antidumping case. This

request by the Solicitor General demonstrates the

significance of the issues raised in the petitions for writs

of certiorari and the importance of having the Federal

Circuit’s decision reviewed and reversed to preserve the

efficacy of the U.S. antidumping law.

The appellate court’s holding has potentially

widespread implications for U.S. industries and workers

that rely upon the U.S. antidumping law to obtain relief

from injury caused by unfairly traded imports. Where

merchandise was manufactured in a foreign country and

imported into the United States for sale at a dumped

price, causing injury to a competing U.S. industry, the

Federal Circuit has held that the antidumping law does

not apply because the foreign producer is merely

providing a “service” not a “good.” The activity of the

foreign producer is plainly one of manufacturing with

the end result being a finished good rather than a service

as that term is traditionally defined (e.g., banking,

medical, legal). Based simply on the structure of the

contract, the Federal Circuit has determined that parties

can avoid the reach of the antidumping laws while still

importing dumped goods into the United States. Left

unreviewed, this determination presents an enormous

loophole to the continued effectiveness of the U.S.

antidumping law.

5

In addition, the Federal Circuit’s failure to accord

Chevron deference to the Commerce Department’s

reasonable interpretation of the antidumping statute to

which it was entitled further warrants the granting of

certiorari in this case. Commerce reasonably concluded,

taking into account the statute’s underlying purpose and

the totality of the circumstances, that the antidumping

statute encompasses transactions where a U.S. customer

provides monetary payments and raw materials to a

foreign producer in exchange for the production of a

substantially transformed, finished product into the

stream of U.S. commerce. The Federal Circuit erred

when it applied its own interpretation of the statute,

rather than deferring to Commerce as required by the

Chevron doctrine. Because the Federal Circuit’s lack of

deference results in a holding that will have serious

- implications for the international trading system as a

whole, the petitions for writs of certiorari should be

granted in this case.

ARGUMENT

I. THE FEDERAL CIRCUIT’S HOLDING IN

EURODIF CREATES A MAJOR LOOPHOLE

UNDERMINING THE EFFICACY OF THE U.S.

ANTIDUMPING LAW

For the first time in the history of the antidumping

duty law, the Federal Circuit has held that a foreign

producer that manufactures and exports a product to

the United States may escape the reach of the U.S.

antidumping law based simply on the terms of its

contract with the U.S. purchaser. The Federal Circuit’s

holding has potentially widespread implications for

6

domestic industries that use the antidumping law to seek

relief from injury caused by unfair trading practices of

foreign producers. Under the Federal Circuit’s holding,

foreign producers of goods that are exported to the

United States will be able to avoid the reach of the U.S.

antidumping law simply by structuring their contracts

in the manner used by the French uranium producer.

This result elevates form over substance and creates a

major loophole to the enforcement of the antidumping

law, warranting the grant of certiorari in this case.

The salient facts at issue and errors in the Federal

Circuit’s determination as applied in the uranium case

are set forth in detail in the Petition for a Writ of

Certiorari of the Solicitor General as well as in the

Petition for Writ of Certiorari submitted by USEC Inc.

and United States Enrichment Corporation and will not

be repeated here. Of major concern to CSUSTL, as

reflected by the filing of this submission, is that the

rationale of the Federal Circuit’s decision extends well

beyond the facts of this uranium case to other U.S.

industries and companies. By concluding that contract

manufacturing can be used to convert imported

merchandise into a “service,” the Federal Circuit’s

holding wrongly treats the sale of an imported good as a

service, exposing domestic industries to injury from

dumped imports without the remedy of the antidumping

law.

Under the Federal Circuit’s decision, if a U.S.

purchaser supplies or arranges for the supply of raw

materials to a foreign manufacturer to be transformed

through a manufacturing process into a different

product, which is then exported back to the purchaser

in the United States, the foreign producer’s activities

7

are considered merely a “service” and not the production

of a “good.” Furodif, 411 F.3d at 1363-64. The Federal

Circuit reached this conclusion based simply on the

terms of the contract between the parties and without

regard to the extensive manufacturing process

undertaken by the foreign producer, the significant

value-added by the foreign producer, the substantial

transformation that occurred to produce the uranium

from the raw material, or the fact that merchandise —

not a “service” — was imported into the United States.

Id. The antidumping statute expressly contemplates that

“imports” of “merchandise” will be subject to

antidumping duties where dumping occurs. 19 U.S.C.

§ 1673(1) (2000).4 The appellate court failed to recognize

that, irrespective of the contract terms, the Commerce

Department was attempting to impose duties on imports

of dumped merchandise as the antidumping law requires.

This broad holding by the Federal Circuit means that

even if merchandise is imported as the statute

contemplates, the merchandise will not be subject to the

law so long as the transaction is structured essentially

as a toll processing transaction. A variety of products,

including in particular steel and other metal products,

chemicals, and textiles, are often sold under toll

processing arrangements. In a toll processing sale, the

purchaser retains title to the input material and pays

the manufacturer to produce and export the finished

product from that input. Under the Federal Circuit’s

holding, structuring a sale as a toll sale would permit

the evasion of antidumping duties, creating a serious

loophole to the law.

* Unless otherwise indicated, all references to the United

States Code are to the 2000 edition.

8

For example, a foreign brass manufacturer may

purchase copper as a raw material input and

manufacture that copper into brass sheet and strip for

export to the United States. Alternatively, the foreign

producer could be provided that same copper by a U.S.

customer for manufacture into brass sheet and strip.

Notably, the U.S. customer need not physically obtain

the input material and transport it to the foreign

manufacturer, but may simply structure this transaction

so that the customer is the title holder of the copper input

product. As a practical matter, under this arrangement,

the customer is carrying the finance cost of the work in

process that would otherwise be carried by the foreign

producer. The foreign manufacturer is engaging in the

same production operations and producing the same

product, the only difference is that the foreign

manufacturer does not finance the raw material costs.

This arrangement does not transform the activity of the

foreign manufacturer in producing the good into that of

providing a service and does not change the fact that

merchandise is imported from that foreign producer into

the United States.

Similarly, in both scenarios the foreign manufacturer

can offer a dumped price for the brass sheet and strip

that it is producing and that dumped price can undercut

competing U.S. brass producers’ prices, causing the U.S.

producers to lose sales and profits. By law, material

injury to a U.S. industry caused by dumped imports is

to be remedied by the imposition of antidumping duties.

19 U.S.C. §§ 1673(1), 1677(7). Under the Federal Circuit’s

holding, however, if the foreign manufacturer structures

the transaction such that the purchaser retains title to

the input raw material, it can deliver the finished brass

9

product at the same injurious, dumped price without any

recourse under the antidumping laws by the injured U.S.

industry that must compete with these dumped imports.

Based on a simple restructuring of the transaction, the

Federal Circuit considered the activity to constitute the

provision of a “service” rather than the sale of a “good”

and, as such, beyond the reach of the antidumping law.

The implications of the Federal Circuit’s holding,

accordingly, extend far beyond the trade in uranium at

issue in this case and implicate all merchandise imports.

If ownership of raw materials changes the sale of a

finished product from foreign “merchandise” into the

sale of a “service,” virtually every import transaction

involving a manufactured product could be restructured

to avoid the application of the antidumping law. In the

steel industry, for example, U.S. purchasers could export

scrap to China, pay Chinese steel producers to melt the

scrap, extrude the steel, hot-roll and cold-roll the steel

to produce cold-rolled sheet, and export that cold-rolled

sheet back to the United States, claiming all they had

provided was a “service” not a good.

Similarly, purchasers of imported pasta could supply

wheat to be transformed into pasta; purchasers of

semiconductors could supply sand to be processed into

semiconductors; and purchasers of bedroom furniture

could supply wood to be manufactured into furniture.

So long as each of those foreign producers structured

the contract so that the purchaser retained title to the

input and characterized its role as providing a “service,”

the overseas manufacturing operations — no matter how

significant those operations and no matter that they

substantially transformed the raw materials into another

10

product that was then exported back to the United States

— would not be subject to the antidumping law. It should

not be the case that merely by structuring the terms of

the transaction in a particular manner foreign producers

can escape the payment of antidumping duties that would

otherwise be owed.

Under the Federal Circuit’s holding, the terms of

the transaction are the paramount consideration for

assessment of whether the antidumping duty law applies

to imported goods. If the importer purchased the product

under terms of a conventional sales transaction, the

product would be subject to the antidumping law. If,

however, the sale was structured to be subdivided into

separate sales of araw material input and the processing

of that input into a finished product, the same imported

good would not be subject to the antidumping law.

Fundamentally, the Federal Circuit has erred by

attempting to draw a line between what constitutes a

“good” and what constitutes a “service” under ‘he

antidumping law on an artificial basis that does not

comport with the real world marketplace. There can be

no question that the French producer of uranium is

engaged in a manufacturing process, that it produces a

product or good, and that the good that it produces is

exported to and enters the stream of commerce in the

United States. Defining this activity as a “service” and

finding that there has not been entry of a good into U.S.

commerce when the uranium from France is imported

into the United States simply does not comport with the

facts.

11

In common parlance, the provision of services is

recognized to relate to activities such as professional

services (medical, legal, banking), maintenance or repair

services or other types of aid that do not result in

production of a tangible good.® Where a foreign company

is engaged in a manufacturing operation whose output

is tangible merchandise, that activity should be

recognized as the production of a good, not a service.

When, in turn, that merchandise or good is exported to

the United States and enters U.S. commerce, it should

be considered subject to the reach of the antidumping

law, regardless of any contractual terms that may be

agreed to between the parties.

The broad reach of the Federal Circuit’s decision and

its potential for undermining the effectiveness of the U.S.

- antidumping law cannot be overstated. The Federal

Circuit has basically provided a roadmap to foreign

producers interested in exporting products to the United

States at unfair prices as to how their transactions should

be structured to avoid antidumping duties. Such a result

is not only inconsistent with longstanding agency

practice and of significant concern to domestic industries

that rely on these unfair trade laws when confronted with

injurious, dumped imports, but it also largely eviscerates

the purpose of the antidumping law. As the courts have

recognized, “the antidumping law is remedial, not

* See 19 U.S.C. § 2114b(5) (defining “services” as “economic

activities whose outputs are other than tangible goods” such as

“banking, insurance, transportation, postal and delivery services,

communications and data processing, retail and wholesale trade,

advertising, accounting, construction, design and engineering,

management consulting, real estate, professional services,

entertainment, education, health care, and tourism.”).

12

punitive, and remedial statutes are to be construed

broadly.” Bomont Indus. v. United States, 13 Ct. Int’]

Trade 546, 550, 718 F. Supp. 958, 962 (1989) (citing 3 N.

Singer, SUTHERLAND Stat. Const. § 60.01 (4th rev. ed.

1986) and cases cited therein). The purpose of the

antidumping law is to “equalize competitive conditions

between foreign exporters and domestic industries

affected by dumping.” Huaiyin Foreign Trade Corp. v.

United States, 322 F.3d 1369, 1379 (Fed. Cir. 2003)

(citations omitted). Congress has emphasized that the

purpose of the antidumping law is to protect domestic

industries from injurious dumping. S. Rep. No. 249, 96"

Cong., 1** Sess. 37 (1979), reprinted in 1979 U.S.C.C.A.N.

381, 423; see also Lasko Metal Prods. v. United States,

43 F.3d 1442, 1446 (Fed. Cir. 1994) (“{t}he purpose of

the {antidumping law} is to prevent dumping, an activity

defined in terms of the marketplace.”).

The United States is losing its manufacturing basis

due, in significant part, to unfair competition from

imported merchandise. The trade remedy laws, including

in particular the antidumping laws, are the only defense

available to U.S. manufacturers against unfairly traded

imports. The loophole to the antidumping law

contemplated by the Federal Circuit’s decision would

severely limit the viability of this remedial tool to

domestic industries injured by dumped imports.

It is difficult to reconcile this remedial statutory

purpose with the appellate court’s decision that would

permit injurious dumping of goods to occur unchecked.

The intent of Congress in providing remedial relief from

the unfair pricing of imported goods must determine

whether the law applies to imported merchandise, not

13

the parties’ contractual terms. When the effect on the

marketplace is considered in light of the remedial

purpose of the statute, the holding of the Federal Circuit

cannot be considered anything but a seriously flawed

interpretation of the statute that dramatically

undermines the very viability of the antidumping law to

U.S. industries and warrants review by granting the

petitions for certiorari.

II. THE FEDERAL CIRCUIT FAILED TO ACCORD

CHEVRON DEFERENCE TO COMMERCE’S

REASONABLE INTERPRETATION OF THE

ANTIDUMPING STATUTE

The Federal Circuit’s failure to follow a fundamental

principle established by this Court in Chevron, U.S.A.,

Inc. v. Natural Resources Defense Council, Inc. , 467 U.S.

837 (1984), provides another reason for granting

certiorari in this case. Under the Chevron doctrine,

courts are to accord deference to reasonable

interpretations of a statute adopted by an administrative

agency that has been “charged with responsibility for

administering the provision.” /d. at 865. Specifically, in

assessing the validity of an agency’s statutory

interpretation, the courts must apply the following two-

part standard:

When a court reviews an agency’s construction

of the statute which it administers, it is

confronted with two questions. First, always,

is the question whether Congress has directly

spoken to the precise question at issue. If the

intent of Congress is clear, that is the end of

the matter; for the court, as well as the agency,

14

must give effect to the unambiguously

expressed intent of Congress. If, however, the

court determines Congress has not directly

addressed the precise question at issue, the

court does not simply impose its own

construction on the statute, as would be

necessary in the absence of an administrative

interpretation. Rather, if the statute is silent

or ambiguous with respect to the specific issue,

the question for the court is whether the

agency’s answer is based on a permissible

construction of the statute.

Id. at 842-43 (1984) (footnotes omitted). More recently,

this Court further explained that deference is

appropriate for ambiguous statutes even when a court

has previously construed the statute. See Natl Cable &

Telecomms. Ass'n v. Brand X Internet Servs., 545 U.S.

967, 982 (2005) (“A court's prior judicial construction of

a statute trumps an agency construction otherwise

entitled to Chevron deference only if the prior court

decision holds that its construction follows from the

unambiguous terms of the statute and thus leaves no

room for agency discretion.”) (emphasis added). Filling

“gaps” in ambiguous statutes “involves difficult policy

choices that agencies are better equipped to make than

courts.” Jd. at 980 (citing Chevron, 467 U.S. at 865-866).

To satisfy the Chevron standard, the courts must

first determine “whether the statute’s plain terms

‘directly address the precise question at issue.” Jd. at

986 (citation omitted). If a “statute is ambiguous on the

point,” the agency’s construction must be given

deference if it is “a reasonable policy choice for the

15

agency to make” and must prevail in such cases, “even if

the agency’s reading differs from what the court believes

is the best statutory interpretation.” /d. at 980 and 986

(citation omitted).

The Federal Circuit failed to follow the Chevron

standard in this case. Nothing in the plain language of

the antidumping statute suggests that imported goods

can evade the reach of the antidumping law based on

the structure of the contract. The antidumping law does

not define the terms “merchandise” or “sold,” and there

is no congressional indication that the phrase “foreign

merchandise is being, or is likely to be sold” does not

encompass transactions where a U.S. customer provides

monetary payments and raw materials to a foreign

producer in exchange for the production of a

substantially transformed, finished product that is

imported into the stream of U.S. commerce. 19 U.S.C.

§ 1673(1). Here, Commerce reasonably concluded, taking

into account the statute’s underlying purpose and the

totality of the circumstances, that products imported

under such transactions are “foreign merchandise .. .

sold in the United States” within the purview of the

antidumping law.

The Federal Circuit determined that Commerce’s

construction of the statute did not warrant deference

under Chevron because “the antidumping statute

unambiguously applies to the sale of goods and not

services.” Eurodif, 423 F.3d at 1278. This conclusion,

however, focuses on the wrong issue. The question is not

whether the statute only applies to the sales of goods

and not services. Rather, as noted above, the relevant

question is what “foreign merchandise is being, or is

16

likely to be sold” means and whether that phrase

encompasses the transactions similar to those at issue

in this case. It is precisely on this issue that judicial

deference must be accorded to Commerce’s construction

of the statute.

Commerce’s determination that the unfair trade laws

must be applicable to imported merchandise produced

through contract manufacturing and without regard to

how the transactions are structured between the foreign

producer and U.S. purchaser is not only proper but is

also a reasonable policy choice for the agency to make.

Indeed, the failure to adopt Commerce’s approach leads

to inconsistent treatment under the antidumping law for

identical imported merchandise dependent upon the

nature of the contract under which the merchandise is

imported. Commerce’s construction of the statute would

preserve the integrity of the antidumping laws by

allowing Commerce to fulfill its statutory objective of

protecting domestic industries from dumped and

injurious imports. Given the underlying statutory

purpose, the Federal Circuit erred in refusing to accord

deference to Commerce’s reasonable policy

determination as well.

In addition, the Federal Circuit erred when it relied

on its prior holding in Florida Power & Light Co. v.

United States, 307 F.3d 1364 (Fed. Cir. 2002), and

concluded that a transaction it previously deemed to be

a sale of a service under one statute cannot also be a

sale of a good under an entirely different statute unless

Congress expressly states that it is. See Eurodif, 423

F.3d at 1277-78 & n.1. This conclusion is a significant

departure from the holding in Brand X, which requires

17

courts to approach its inquiry as if it were “reviewing

the agency’s construction on a blank slate.” Brand X,

545 U.S. at 982-83. Because the statute does not compel

the court’s interpretation, it was improper for the

Federal Circuit to not defer to Commerce’s reasonable

interpretation of the antidumping statute.

In sum, if the Federal Circuit’s construction of the

antidumping statute is upheld, an enormous loophole in

the U.S. trade laws will be created that will encourage

foreign producers of all industries to circumvent

antidumping laws by structuring their transactions with

domestic buyers as contracts for “services.” Because of

the Federal Circuit’s failure to accord deference to

Commerce’s reasonable construction of the statute and

because the Federal Circuit’s holding will have serious

implications for the international trading system as a

whole, the petitions for writs of certiorari should be

granted in this case.

18

CONCLUSION

For the above-stated reasons, the petitions for writs

of certiorari should be granted.

Respectfully submitted,

Davin A. HARTQUIST

Executive Director of the Committee

to Support U.S. Trade Laws

KELLEY DrrE & WarRREN LLP

3050 K Street, Suite 400

Washington, D.C. 20007

(202) 342-8400

Counsel for Amici Curiae

tt 6 eth es het et at ih RE Pe ee