Background

The Biden administration has outlined its primary defenses to the more than 3,500 cases filed at the Court of International Trade against Section 301 tariffs on List 3 and 4A goods from China. These cases have been assigned to a panel of three CIT judges, who are considering a proposal to establish and proceed with a single test case. Importers of affected goods can still preserve their rights to possible refunds of these tariffs by joining this litigation.

The plaintiffs generally allege that the Section 301 tariffs on List 3 and List 4A goods (imports of which are collectively valued at more than $300 billion a year) were imposed in violation of the authority provided under the Trade Act of 1974 and the Administrative Procedures Act. For example, the plaintiffs argue that these tariffs were levied more than a year after the underlying investigation was initiated and were based not on that investigation but other reasons, including retaliating against China, compelling it to import more U.S. goods, and collecting revenue for the U.S. treasury. The plaintiffs also contend that the tariffs were levied in an arbitrary and capricious manner because federal officials failed to meaningfully consider relevant factors when making their decisions and failed to adequately explain their rationale.

In response, the U.S. asserts that USTR had statutory authority to issue the List 3 and 4 tariffs because the burden or restriction on U.S. commerce by the Chinese acts, policies, and practices at issue in the Section 301 investigation had continued to increase and the List 1 and 2 tariffs had proven ineffective in eliminating them. The U.S. adds that USTR’s authority to modify previous tariff actions is not limited to delaying, tapering, or terminating them, as the plaintiffs assert. Other defenses raised include that USTR was acting at the direction of the president, who is not subject to the APA, and that the court is precluded from reviewing the president’s discretionary decisions and USTR’s implementation of them.

If this litigation is successful, refunds of all Section 301 tariffs paid on List 3 and List 4A goods, regardless of whether an exclusion was previously available or filed, will potentially become available. Importers can still join this challenge and preserve their rights to such refunds by filing a complaint in the CIT.

ST&R attorneys are available to counsel importers and file these claims. For more information, or assistance filing your claim, please contact attorneys Larry Ordet, Lenny Feldman, Rob DeCamp, or David Cohen at 301Litigation@strtrade.com.

Copyright © 2021 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

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