CIT Finds Standalone Furniture Rarely Subject to Wooden Bedroom Furniture Duties
There's only a very narrow set of circumstances under which furniture that is not part of a bedroom set may be subject to antidumping duties on wooden bedroom furniture from China, ruled the Court of International Trade on Dec. 1 as it remanded a scope ruling on Ethan Allen chests (here). Though standalone furniture may sometimes be included under the scope, finding part of a living room set subject to bedroom furniture duties exceeds that narrow exception, said the court as it sent the ruling back to the Commerce Department for reconsideration.
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At issue in the case is a May 2014 scope ruling where Commerce found Ethan Allen’s Marlene, Nadine, Serpentine and Vivica chests are subject to duties on wooden bedroom furniture from China, despite Ethan Allen’s insistence that the chests are actually living room furniture and, in the case of the Vivica, included in a living room set (see 14060403). Commerce later voluntarily reopened its ruling on the Vivica chests to gather more comments, but left its conclusions unchanged (see 1412080030).
CIT ruled that inclusion in a bedroom set is not an absolute requirement for coverage under the scope. The scope says subject wooden bedroom furniture is “generally, but not exclusively” sold in sets, allowing some standalone pieces to be covered. Nor must those standalone pieces be “intrinsically and immutably” bedroom furniture, a standard that, if adopted, would exclude many pieces of furniture used in bedrooms, like armoires and bookshelves, from the scope.
However, the four chests included in Ethan Allen’s scope request may not qualify as covered standalone furniture, said CIT. Relying on the language of the scope and the petition, Commerce had determined the Marlene, Nadine and Serpentine chests to be subject to duties because they are fully capable of holding clothes. However, that is only one factor Commerce should have considered, said CIT. The petition also says living room furniture is more decorative than bedroom furniture. Commerce should have considered a full range of factors, including physical characteristics, advertising and channels of trade, to determine whether the Marlene, Nadine and Serpentine chests are covered by the scope.
Conversely, the question of whether the Vivica chest is covered, which Commerce had decided based on a consideration of the full range of factors, should have instead been resolved simply by looking to the scope and the petition. Though furniture that isn’t part of a bedroom set may be subject to duties, the petition makes clear that coverage of standalone furniture is narrow: subject wooden bedroom furniture “overwhelmingly, designed, manufactured, and sold as suites,” according to the petition. As part of a living room set, the Ethan Allen’s Vivica chest does not fall into that narrow exception, said CIT. “It is inconsistent with the [wooden bedroom furniture] Order to read the narrow exception found in the ‘generally, but not exclusively’ language to be so broad as to include coordinated living room furniture,” it said.
CIT ordered Commerce to file an amended scope determination by Feb. 1, with arguments from each side following in March. Though Ethan Allen had also challenged Commerce’s instruction to CBP to “continue to suspend liquidation,” arguing the directive was impermissibly retroactive, CIT sidestepped the issue as potentially moot if the chests are found to be outside the scope.
(Ethan Allen Operations, Inc. v. United States, CIT # 14-00147, Slip Op. 15-134, dated 12/01/15, Judge Restani)
(Attorneys: Yohai Baisburd of Dentons for plaintiff Ethan Allen Operations, Inc.; Douglas Edelschick for defendant U.S. government)