Commerce Didn't Say If Importer's Boards Are 'Wood Mouldings' or 'Millwork Products,' CIT Says
The Commerce Department failed to consider whether importer Hardware Resources' edge-glued wood boards were wood mouldings and millwork products when it included the goods in the antidumping and countervailing duty orders on wood mouldings and millwork products from China, the Court of International Trade held on Dec. 16. In his first decision since joining the court, Judge Joseph Laroski said Commerce "ignored the threshold question of whether the product at issue is a wood moulding or millwork product."
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Hardware Resources sought a scope ruling for its edge-glued boards made of solid white birch that are finger-jointed and edge-glued.
After Commerce included its products in the orders, the importer took to the trade court, arguing, among other things, that the agency failed to consider whether the company's boards are wood mouldings or millwork products. Hardware Resources said a "plain language analysis of the phrase 'mouldings and millwork products' implies an end-use requirement" that a product subject to the duties must be "intended for use as a moulding or millwork product."
Since Commerce didn't provide a meaning to the phrase "wood moldings and millwork product" and based its decision solely on the physical characteristics in the scope language, the agency's "cursory discussion" of the plain scope language was wrong, the company argued. Hardware Resources claimed that Commerce should have turned to the (k)(1) sources to define the key phrase at issue.
In response, the U.S. said the company's edge-glued boards "meet all physical characteristics required by the scope" and are "indistinguishable" from a millwork product. The government argued that Commerce properly said the scope covers products made of wood and "continuously shaped wood or finger-jointed or edge-glued moulding or millwork blanks," claiming that the only ambiguity allowing for the use of (k)(1) sources is the phrase "continuously shaped."
Laroski agreed with the importer, finding that Commerce ignored the scope language's "initial requirement" present in the phrase that only "wood mouldings and millwork products that" are made of wood are covered. Despite the government's arguments that the products are wood mouldings or millwork products as laid out by the scope, Commerce drew "no such conclusion," the judge said.
While Commerce indicated that the process by which the boards are sawed to make a groove leads to a product "indistinguishable" from a millwork product, this discussion "relates to its analysis of whether Hardware Resources’ product is 'continuously shaped' and not a conclusion that Hardware Resources’ product is millwork product," the court held. Laroski also noted that, in the past, Commerce has affirmatively found that products subject to scope ruling requests are, or are not, millwork products.
Commerce failed to "give thorough and fair consideration to 'language of the scope,'" as required by its regulations, the court said.
(Hardware Resources v. United States, Slip Op. 24-140, CIT # 23-00150, dated 12/16/24; Judge: Joseph Laroski; Attorneys: Jill Cramer of Mowry & Grimson for plaintiff Hardware Resources; Emma Bond for defendant U.S. government; Wesley Weeks of Wiley Rein for defendant-intervenor Coalition of American Millwork Producers)