Court ruling due on U.S. duties on Chinese OTR tires

The legal status of U.S. duties on certain OTR tire imports from China continues to be challenged in court, and the resolution of the case could become legal precedent, those involved in the case say.

One year after a trio of Chinese OTR tire manufacturers and importers sued to overturn a 2012 law applying retroactive countervailing duties to their products, the case awaits final adjudication before the U.S. Court of International Trade (CIT), which has jurisdiction of the case.

No matter which way CIT Judge Jane Restani decides the case, the plaintiffs still are likely to appeal it to the U.S. Court of Appeals for the Federal Circuit, according to attorney Daniel L. Porter with the Washington law firm of Curtis, Mallet-Prevost, Colt & Mosle L.L.P., who represents the plaintiffs.

This is because Judge Restani ruled last January against the plaintiffs' claim that the new law is unconstitutional, Mr. Porter said. She did find fault with the U.S. Department of Commerce's determinations of countervailing duties, however, and remanded them to the agency for re-evaluation.

Commerce has since submitted its new numbers to the court, and all the parties have commented on them, Mr. Porter said. Judge Restani is expected to rule on the countervailing duty issue soon, although there is no timetable for her to issue a ruling, he said.

The plaintiffs—Hebei Starbright Tire Co. Ltd., Tianjin United Tire & Rubber International Co. Ltd. and remnants of the bankrupt GPX International Tire Corp.—still believe adamantly that the law violates both the Ex Post Facto Clause of the U.S. Constitution, which forbids retroactive criminalization of behaviors or activities, and the Due Process Clause of the Fifth Amendment.

Mr. Porter also is a plaintiffs' attorney in Guangdong Wireking Housewares & Hardware Co. Ltd.'s case against the Commerce Department, which was filed in the Federal Circuit appeals court July 15.

The Guangdong case, which also challenges the retroactive countervailing duty law on constitutional grounds, cites the appeals court's December 2011 decision in the OTR tire case as a precedent.

"This court held unambiguously that countervailing duties cannot be applied to goods from non-market-economy countries," the Guangdong brief states.

Unfortunately for the Chinese plaintiffs, the Federal Circuit decision also led directly to the countervailing duty law that Congress passed overwhelmingly in March 2012.

Source: tirebusiness.com