Trade Case Appellate Review Standards May Make Litigation Unpredictable, Say CIT and CAFC Judges
The standard under which the Court of Appeals for the Federal Circuit reviews some antidumping and countervailing duty cases from the Court of International Trade may be causing a lack of uniformity in appeals court decisions and a lack of predictability for litigants, said five judges from CAFC and CIT during a panel discussion Nov. 21. CAFC Chief Judge Randall Rader and Judges Jimmie Reyna and Evan Wallach, as well as CIT Chief Judge Donald Pogue and Judge Timothy Stanceu participated in the discussion, hosted by the Federal Circuit Bar Association and the Customs and International Trade Bar Association. Hot on the heels of a dissent where Rader, Reyna and Wallach questioned CAFC's practice of taking a fresh look at many CIT cases instead of deferring more to the lower court's expertise, all five judges discussed whether the review standard is due for a change.
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Despite CIT’s specialization in trade cases, CAFC actually affirms a lower percentage of CIT cases than other appeals courts, noted CIT Judge Pogue to begin the discussion. In fiscal year 2013, 72.2% of appeals of CIT cases were either affirmed or dismissed, and 25% were reversed or remanded. Regional circuit courts of appeal, on the other hand, affirmed 80% of civil cases originating in district courts, said Pogue. While some may see that as the product of a hardworking CAFC that’s especially willing to write dissents, joked Pogue, “it might also lead you to wonder why a specialist court would have a lower affirmance rate than a regional generalist court.”
One reason may be a lack of uniformity because of the standard the appeals court uses to analyze some antidumping and countervailing duty cases. When CIT tells an agency to reexamine antidumping and countervailing duty disputes because the Commerce Department or International Trade Commission didn’t support their findings with enough evidence, that remand to the agency is reviewed by the appeals court “de novo.” That means CAFC takes a fresh look directly at the Commerce or ITC determination to see if it was supported by substantial evidence, rather than deciding whether CIT’s decision to remand was justified. “I think the real issue is that it’s just unlikely that the second tier of substantial evidence review is going to serve uniformity because, as a practical matter, appeals court judges just don’t have the time to spend with the record that CIT judges do,” said Pogue.
The substantial evidence standard of review was recently the subject of disagreement between appeals court judges that provoked a dissent from CAFC Judges Rader, Reyna and Wallach in NSK v. U.S. In that case, CAFC reversed a series of CIT decisions going back seven years on an AD duty sunset review on ball bearings from the UK and Japan, and effectively ordered reinstatement of the revoked AD duty order (see 13103122). In their dissent, Rader, Reyna and Wallach said CAFC should depart from its current standard of how it reviews CIT decisions, and defer more to the lower court’s expertise on trade.
The wavering deference the appeals court grants to CIT decisions is one example of the lack of uniformity that results from the current standard of review, said Wallach during the panel. “What’s happened here is there are really two lines of cases in this circuit,” he said. In many cases, CAFC says CIT has a very high level of expertise, and defers to the lower court. But in many others, CAFC judges cite a case called Atlantic Sugar to support reviewing the lower court ruling from scratch. “Sooner or later, that’s going to have to be resolved,” said Wallach. Resolution could go either way -- it may be that the result is less deference to the lower court, he said. “But the question must be resolved in some fashion, because litigants don’t have what the rule of law requires, which is predictability.”
Pogue said that question should be resolved in favor of more deference to CIT decisions. By the time cases arrive at CAFC, they've been thoroughly vetted by the lower court and have often been the subject of multiple remands, Pogue said. Many dissents at the appeals court have been filed because of the greater specialization at the lower court. “Someone might be called to dissent because the case has been reformulated in arguments so that it doesn’t respect the kind of history and working of the issue that has been done” by CIT, said Pogue.
Current Standard May Be Outdated, Especially After 2006 Decision
The current standard of review developed over time from the jurisprudence of the now-defunct Court of Customs and Patent Appeals, and may be outdated, said Rader. That court received fewer than 100 cases per year, he said. “They had a very small number of cases, and they had time and disposition to deal with the minutia,” he said. “I’m not sure that is reflective of current appeals and the way that they happen before the Federal Circuit.”
But another reason the standard of review may be outdated is CAFC’s 2006 ruling in Nippon Steel, where it took issue with CIT’s decision to order reversal of an ITC injury determination rather than issue a simple remand that gave the agency a choice on how to resolve the matter. Because of that ruling, the agency and CIT will more often be on the same page by the time a case reaches CIT, because the case will have gone through a series of remands, said Pogue. In such cases, “it just doesn’t make sense to me that they wouldn’t have a higher level of deference,” he said.
Discussion of the correct review standard for CIT substantial evidence cases has been ongoing for almost 20 years, and Rader wondered why the government hasn't weighed in on the issue. "I haven't seen the United States government stepping forward to request a change," he asked: "Why would that be?" Pogue answered: "all litigants like two bites at the apple."