ANNOUNCED AS TEMPORARYNo
On April 26, 2016 the U.S. Steel Corporation took a highly novel approach to restricting imports from China. In place of filing either anti-dumping or countervailing duty petitions with the U.S. International Trade Commission (USITC), which has heretofore been the tool of choice for the steel industry, it instead filed a petition with the USITC under a statute that is typically used to deal with complaints related to intellectual property rights.
Section 337 of the Tariff Act of 1930 (as amended) permits the USITC to issue cease and desist orders against imports that are found to engage in unfair trade practices, and can block those imports altogether. Most investigations under this law involve allegations of patent or registered trademark infringement. Other forms of unfair competition, such as misappropriation of trade secrets, trade dress infringement, passing off, false advertising, and violations of the antitrust laws, may also be asserted.
The U.S. Steel petition focuses upon claims ofillegal, unfair methods of competition, and seeks the exclusion of all unfairly traded Chinese steel products from the U.S. market. It lists forty Chinese companies as its respondents. The complaint alleges three causes of action: the illegal conspiracy to fix prices, the theft of trade secrets, and the circumvention of trade duties by false labeling.
"We have said that we will use every tool available to fight for fair trade," said President and Chief Executive Officer Mario Longhi."With 'this' filing, we continue the work we have pursued through countervailing and anti-dumping cases and pushing for increased enforcement of existing laws."
The United Steelworkers (USW) union is not a party to the petition, but International President Leo W. Gerard issued a statement of support on the day that it was filed. "The approach the company is taking is bold, but necessary," said Gerard. "The USW has joined with the company on many anti-dumping and countervailing duty cases. U.S. Steel is now utilizing a provision of the law that has primarily been used to combat intellectual property rights violations. But the underlying law also provides broad authority to stop the kind of actions China is utilizing. When implemented, it will prohibit imports altogether from entering our market."
The USITC has up to thirty days to evaluate the petition for relief and decide whether to initiate the case. If the matter proceeds, an administrative law judge is then assigned to the case. During the evidentiary discovery process, the parties may seek the issuance of nationwide subpoenas and orders for the production of relevant documents.
On May 26, 2016 the USITC instituted the investigation. It made the following statement: "By instituting this investigation (337-TA-1002), the USITC has not yet made any decision on the merits of the case. The USITC's Chief Administrative Law Judge will assign the case to one of the USITC's administrative law judges (ALJ), who will schedule and hold an evidentiary hearing. The ALJ will make an initial determination as to whether there is a violation of section 337; that initial determination is subject to review by the Commission."
The USITC further observed that it "will make a final determination in the investigation at the earliest practicable time. Within 45 days after institution of the investigation, the USITC will set a target date for completing the investigation.USITC remedial orders in section 337 cases are effective when issued and become final 60 days after issuance unless disapproved for policy reasons by the U.S. Trade Representative within that 60-day period."
In a July 6, 2016 ruling the administrative law judge in charge of this case suspended the investigation on the grounds that it 'comes at least 'in part' within the purview of the anti-dumping and countervailing laws . . . 'and' therefore requires that the Commission notify the Secretary of Commerce' before determining how to proceed. Following a petition from U.S. Steel, the USITC voted on August 5, 2016 to vacate the suspension and remand the investigation back to the administrative law judge. The commission did not provide a rationale for the change, but said that an explanation will be forthcoming.
⚑ Please report this page in case you detect an inaccuracy in its content.