[00:00:00] Speaker 03: Okay, the next argued case is number 16, 2657, Meridian Products, LLC, against the United States. [00:00:08] Speaker 03: Mr. DeFrancisco. [00:00:13] Speaker 00: Thank you, Your Honor. [00:00:15] Speaker 00: For the record, Robert DeFrancisco on behalf of the Loan Extruder's Fair Trade Committee. [00:00:20] Speaker 00: We would like to begin with a discussion of the lower court's decision in this case. [00:00:27] Speaker 00: We believe the Court of International Trade inappropriately applied existing precedent in this case and disregarded factual findings by the Department of Commerce in the original scope determination and substituted its judgment for that of the agencies. [00:00:42] Speaker 00: As such, we would ask this Court to vacate the lower court's decision and reinstate Commerce's original scope determination with respect to the appliance handles at issue here. [00:00:53] Speaker 00: We believe the lower court's decision rests entirely on its own legal and factual determination as to whether the particular end caps of this appliance handle were or were not fasteners. [00:01:06] Speaker 00: That this court has said in previous instances, commerce's interpretation of its scope is accorded substantial deference and in interpreting the language of the scope, [00:01:19] Speaker 00: that deference should have been applied here, especially as it relates to what is or is not a fastener. [00:01:26] Speaker 00: The determination as to whether a particular component then meets that definition of fastener, whether it's broader or narrower, is a factual conclusion, again, reviewed under substantial evidence, that we believe the lower court inappropriately substituted its judgment there as well on a factual ground as well. [00:01:44] Speaker 00: In both instances, as we said, the CIT inappropriately substituted its judgment for that of the [00:01:49] Speaker 00: departments. [00:01:51] Speaker 00: First, the lower court narrowly defined or interpreted the word fastener in this case as it relates to these end caps. [00:02:00] Speaker 00: The lower court believed that fasteners should be nuts, bolts, or screws, things that are generally made of steel. [00:02:08] Speaker 00: The scope language itself as it relates to fasteners talks about nuts, bolts, screws, but uses the language [00:02:16] Speaker 00: as such, or such as, rather, and et cetera, that's not limiting its exemplary of the types of fasteners, but it is in no way intended to limit those fasteners to just those types of things. [00:02:29] Speaker 02: And in fact... Well, you know, it's not clear that the scope language was as precise as it should have been, but, I mean, the Commerce didn't make any findings with respect to sub-assemblies language or, I mean, or exactly what [00:02:45] Speaker 02: such as with me, right? [00:02:47] Speaker 00: Well, so, Your Honor, two different decisions. [00:02:50] Speaker 00: In its remand decision, Commerce said because the court, the lower court, found that these end caps were not fasteners and were another component, that therefore the product didn't meet the scope definition at all and therefore couldn't reach the parts and sub-assemblies portion of the scope at all. [00:03:13] Speaker 00: Now, we would say that [00:03:15] Speaker 00: If the court believed that the fastener language was ambiguous, it had to ask commerce in a remand to go back and using its interpretive guidance set forth in its own regulations under the K1 and K2 analysis to interpret what is meant by fastener. [00:03:34] Speaker 00: And we think if they had done that, the petition itself in this case, which is one of the items that are supposed to be reviewed under K1, [00:03:46] Speaker 00: and prior decisions and previous decisions of what a fastener is, it would have found that it is a much broader definition than the lower court applied. [00:03:54] Speaker 02: And in fact, this- But wait, all the CIT did, and Judge Fancy said, commerce's definition in the first instance of what fell within the scope was too broad. [00:04:06] Speaker 02: And he said that this particular thing doesn't seem to fall within that definition. [00:04:14] Speaker 02: But commerce could have gone back and said, well, actually, it falls within some narrower definition, and it didn't. [00:04:21] Speaker 00: We believe Judge Stansu's decision as to whether it was too broad or not was entirely premised on whether that end cap was a fastener or not. [00:04:31] Speaker 00: So if that end cap was a fastener, then it's an extruded aluminum form that's defined by its end use as a handle. [00:04:41] Speaker 00: That clearly meets the definition. [00:04:43] Speaker 02: even if you assume that that end cap... But then that's a factual finding that ultimately the Commerce adopted. [00:04:53] Speaker 02: Correct. [00:04:53] Speaker 02: You're asking us to reverse that factual finding. [00:04:56] Speaker 00: Correct. [00:04:57] Speaker 00: Well, we have two arguments. [00:04:59] Speaker 00: One, that the lower court improperly interpreted, substituted its judgment as to what is meant by a fastener to begin with, which is, in effect, a conclusion that Commerce was the [00:05:11] Speaker 02: But Commerce didn't, in its initial decision, didn't say, oh, and by the way, these are fasteners. [00:05:18] Speaker 00: Yes, it did. [00:05:19] Speaker 00: It said, in its original determination, that these end caps were, in fact, fasteners. [00:05:24] Speaker 00: And because they were fasteners, it didn't remove them from the scope. [00:05:29] Speaker 00: The court concluded otherwise. [00:05:30] Speaker 00: And in its remand determination, Commerce said, [00:05:35] Speaker 00: You know, we are constrained by what the lower court found because the lower court said that these are not in fact fasteners. [00:05:41] Speaker 00: The lower court couldn't have gotten to the position it got to. [00:05:44] Speaker 00: If the lower court agreed with Commerce that they were fasteners, then they would have been subject merchants. [00:05:50] Speaker 02: Again, but that only matters if we're talking about the finished goods kit exclusion, right? [00:05:58] Speaker 00: Correct. [00:05:59] Speaker 00: Finished goods and finished goods kits, yes. [00:06:01] Speaker 00: Now, you're absolutely right. [00:06:02] Speaker 00: Commerce could have then addressed [00:06:05] Speaker 00: whether it was subject as parts or as a sub-assembly and it declined. [00:06:10] Speaker 00: No, it didn't do that. [00:06:10] Speaker 00: It didn't do that. [00:06:11] Speaker 00: It could have. [00:06:12] Speaker 00: We believe it could have. [00:06:15] Speaker 00: Obviously, this court in the curtain wall decision in Yuanda, where it looked at curtain wall units as to whether it was subject merchandise, in that case, those curtain wall units contained more than just extruded aluminum parts. [00:06:32] Speaker 00: Yet this court found that that was subject merchandise because it was a part of the finished curtain wall. [00:06:39] Speaker 00: The same would be true here. [00:06:41] Speaker 00: This is a handle. [00:06:42] Speaker 00: Whether you agree that the end cap is a fastener or not, it's a non-extruded part. [00:06:48] Speaker 00: But the handle portion is an extrusion. [00:06:53] Speaker 00: And it could not be attached to that oven. [00:06:56] Speaker 00: And the oven doesn't function without the handle. [00:06:58] Speaker 00: The handle is a part of the oven. [00:07:00] Speaker 00: And it would therefore be covered under that language as well, which we believe. [00:07:03] Speaker 00: But commerce didn't address that issue on remand. [00:07:08] Speaker 00: But beyond that, Your Honor, the lower court's decision is premised, again, on this definition of whether that NCAP is a fastener or not. [00:07:17] Speaker 00: And its interpretation that NCAP was not a fastener [00:07:27] Speaker 00: Then the lower court moves to the conclusion that, well, therefore, in its assembly, and it's out completely, it doesn't meet the definition at all. [00:07:33] Speaker 00: But again, as we just talked about, that's not true. [00:07:35] Speaker 00: This court has found that assemblies, like a curtain wall unit, are subject to the scope. [00:07:42] Speaker 00: So whether something is an assembly or not doesn't take it out of the scope. [00:07:45] Speaker 02: It's a question of whether does that assembly then meet those other... Did Commerce ever say that these are assembled merchandise? [00:07:56] Speaker 00: The British merchandise exception? [00:07:59] Speaker 00: I'm sorry, say that again. [00:08:01] Speaker 02: Whether they are assembled merchandise? [00:08:05] Speaker 00: It didn't say whether it was assembled or not. [00:08:08] Speaker 00: It does, in fact, say that in the petition request itself from the respondents, they call it assembled merchandise. [00:08:15] Speaker 00: It appears to be assembled from the schematic. [00:08:19] Speaker 03: This is a focus. [00:08:19] Speaker 03: Again, I'm going to read you a question from Judge Raina. [00:08:22] Speaker 03: How do you consider type B handles, or do you consider them as an assembly or a sub-assembly? [00:08:29] Speaker 03: Why? [00:08:29] Speaker 03: And why is it significant? [00:08:31] Speaker 00: Certainly. [00:08:32] Speaker 00: So if it were an assembly, we still believe, again, as we've said before, this court has found other assemblies to be covered by the scope. [00:08:39] Speaker 00: So whether it's assembly or not doesn't necessarily take it out of the scope. [00:08:43] Speaker 03: OK. [00:08:44] Speaker 00: If it were an assembly, you would then examine whether it's part of the [00:08:50] Speaker 00: final finished good and in that scenario this is a handle that's a handle for an oven so that the oven is the finished good and this is part of that and ought to be covered the fact that you have a minor non-extruded part that's associated with it doesn't necessarily take it out of the scope under that ground and it's certainly we believe a sub-assembly of the oven again going back to that part language so in either scenario we believe it would be covered but I think that our [00:09:19] Speaker 00: The basic argument is that the lower court in interpreting fastener or what was meant by fastener with respect to this end cap overreached. [00:09:30] Speaker 02: Right, but there might have been two other grounds on which commerce could have reached the same conclusion and it chose not to do so. [00:09:37] Speaker 00: Yes, Your Honor, that's true. [00:09:39] Speaker 00: But the basis that this was taken out was based on the lower court's determination that that end cap was not a fastener. [00:09:47] Speaker 00: and therefore didn't meet the definition, and then commerce didn't reach those other two grounds. [00:09:55] Speaker 00: And like I said, again, in answering the other question, that this could be covered as an assembly or a sub-assembly or part of the oven. [00:10:04] Speaker 00: It clearly is a handle for the oven. [00:10:07] Speaker 00: It's described as a handle for the oven. [00:10:10] Speaker 00: I don't know of anyone who buys an oven without a handle. [00:10:14] Speaker 00: can't really use the oven without the handle. [00:10:17] Speaker 00: It's a part of the oven and could be covered under that ground as well. [00:10:22] Speaker 00: But at base, at root, the end cap, we believe, is a fastener. [00:10:26] Speaker 00: If the schematic demonstrates that it's a fastener, the respondents themselves in their initial petition described it as a fastener. [00:10:34] Speaker 00: It was appropriate for Commerce to define it as a fastener. [00:10:37] Speaker 00: And this court, while it hasn't expressly addressed what's meant by fastener, [00:10:44] Speaker 00: In a few other cases, meridian trim kits being one of them and then district cargo being another, those were cases where you looked at whether something was in or out under the finished goods merchandise exception and whether something was a fastener. [00:10:59] Speaker 00: And in those cases, we had brackets and we had iron buckles or locking mechanisms. [00:11:06] Speaker 00: Those were fasteners and both of those were approved as being subject merchandise. [00:11:12] Speaker 00: and not qualifying for those exceptions, which is exemplary of how that fastener language ought to be interpreted and how commerce has interpreted that fastener language. [00:11:22] Speaker 00: And we believe where these end caps would fit within. [00:11:26] Speaker 00: But the lower court did not get there. [00:11:30] Speaker 03: Thank you. [00:11:30] Speaker 03: Let's hear from the government. [00:11:37] Speaker 01: Ms. [00:11:37] Speaker 01: Hatfield. [00:11:39] Speaker 01: Good morning, Your Honor. [00:11:39] Speaker 01: Francis Hatfield on behalf of Meridian Products. [00:11:42] Speaker 01: The government has chosen that to brief in this manner. [00:11:45] Speaker 01: So we believe that the trade court's judgment in this case should be affirmed. [00:11:50] Speaker 01: There are three points I'd like to make. [00:11:52] Speaker 01: There is no determination in the underlying proceeding that end caps were fasteners. [00:11:57] Speaker 01: We'll not find that anywhere in the scope of the decision. [00:12:01] Speaker 01: It is an assembly, and this product satisfies the finished good exclusion. [00:12:07] Speaker 01: So the court found fault with two in the underlying decision. [00:12:10] Speaker 01: The court found fault with two of Commerce's conclusions. [00:12:14] Speaker 01: First, the type B handles did not qualify under the finished merchandise exclusion. [00:12:20] Speaker 01: And they were not analyzed separately. [00:12:23] Speaker 01: They weren't analyzed at all. [00:12:25] Speaker 01: Right. [00:12:26] Speaker 02: So Commerce never actually separately said whether or not they satisfied the finished merchandise exception. [00:12:31] Speaker 01: That's correct. [00:12:31] Speaker 01: And they never examined the end caps. [00:12:34] Speaker 01: to it whether they were an assembly in that final scope ruling. [00:12:38] Speaker 02: Do you believe they could have gone back and disagreed with the CIT and said those end caps are brackets? [00:12:50] Speaker 01: Are fasteners? [00:12:52] Speaker 01: Yes, Your Honor. [00:12:53] Speaker 01: I think that they could have gone and done that. [00:12:55] Speaker 01: I think that it would have been a difficult thing for the government to have done because Judge Stansu said that that was a fanciful argument. [00:13:01] Speaker 01: That's a little bit difficult to go back once the judge makes a comment during oral argument. [00:13:05] Speaker 01: That was a fanciful argument to go back and then say, oh, we think these are fasteners. [00:13:09] Speaker 01: And if you look at the type of things, so let's use the juice of generis in describing what a fastener is, a bolt, a nut, a screw. [00:13:16] Speaker 01: They're all steel articles, brackets, as was the case in the Meridian decision. [00:13:20] Speaker 01: They all have commonality in them. [00:13:22] Speaker 01: That's something that the injected mold, plastic, and caps simply do not have. [00:13:27] Speaker 02: It seems a little odd, though, that [00:13:29] Speaker 02: Type A and Type C handles are covered by the scope order, but the Type B handles are not. [00:13:36] Speaker 02: There doesn't seem to be a huge distinction between the three categories. [00:13:44] Speaker 01: I would say there actually is a big distinction among the three categories. [00:13:47] Speaker 01: So with A and C, we have an extrusion. [00:13:50] Speaker 01: That's it. [00:13:51] Speaker 01: And you throw in some screws that attaches to the oven. [00:13:54] Speaker 01: But in the case of the B handle, and that's the schematic that Judge Tansey looked at, [00:13:58] Speaker 01: You have these injected mold end caps, five pieces, that are screwed into the handle. [00:14:03] Speaker 01: And then it's from those inject mold end caps that you have two more screws that then attach that to the oven itself. [00:14:09] Speaker 01: So in A and C, you have A piece, a singular piece. [00:14:12] Speaker 01: And with B, you have five pieces. [00:14:15] Speaker 01: And the A-E-F-T-C has kind of played loosey goosey with what our scope request actually was. [00:14:22] Speaker 01: But I'd like to read the language, because I think it's important. [00:14:24] Speaker 01: Type B handles are also for oven handle assemblies. [00:14:28] Speaker 01: consisting of aluminum extrusions. [00:14:31] Speaker 01: And this handle is an assembly in the middle of the handle bar. [00:14:34] Speaker 01: Extrusion, please, plus two plastic injection molded end caps at each end. [00:14:38] Speaker 01: The end caps are attached at each end of the handle to serve as a finished end and the mechanism for attaching to the oven door. [00:14:45] Speaker 01: Holes are drilled in line to match the door holes of the oven door for final assembly. [00:14:50] Speaker 01: Well, that's different from A and C. And everyone kind of plays loosey goosey with the language that these [00:14:56] Speaker 01: plastic injectable end caps are fasteners, but they're not. [00:14:59] Speaker 01: You couldn't go into a hardware store and you wouldn't go in the bolt and the nut and the screw section and find plastic and mold injection end caps as any of that sort of fastener hardware. [00:15:09] Speaker 01: It wouldn't be there. [00:15:11] Speaker 03: It does seem like an artificial distinction. [00:15:14] Speaker 03: They're all extruded aluminum. [00:15:16] Speaker 03: They all serve the same purpose and all that you have is the plastic insertion. [00:15:22] Speaker 03: Isn't that the difference? [00:15:24] Speaker 01: That you have a finished assembly versus? [00:15:26] Speaker 01: Yes. [00:15:27] Speaker 01: Well, you do have a finished assembly. [00:15:28] Speaker 03: Well, in a type B. Yes. [00:15:30] Speaker 01: That is a finished assembly. [00:15:32] Speaker 01: It's a finished product. [00:15:34] Speaker 01: Whereas with the extrusion pieces, you don't have an assembled anything. [00:15:37] Speaker 01: Nothing's assembled in ANC with those two types of handles. [00:15:40] Speaker 03: Wouldn't one think that the extruded aluminum component is a dominant component and ought to control the results? [00:15:48] Speaker 01: That could have been a determination that Commerce could have made, but they didn't make any finding regarding that in the scope ruling. [00:15:54] Speaker 01: They didn't address that at all. [00:15:56] Speaker 01: And so that could have been a fact finding. [00:15:58] Speaker 01: We don't have it before us, and we don't have that speculation. [00:16:01] Speaker 01: And our standard review in this matter is whether or not the CIT, when reviewed in Commerce's scope ruling, whether it was supported by substantial evidence. [00:16:11] Speaker 01: And that's what the CIT determined in the underlying matter, was that it was, in fact, not supported by substantial evidence. [00:16:18] Speaker 01: it wasn't discussed at all. [00:16:20] Speaker 01: And so there was no basis for Judge Stansu to make a determination regarding the findings, the end result of that finding. [00:16:28] Speaker 02: So there was no discussion in Congress's decisions about the substantial component aspect? [00:16:36] Speaker 01: Correct. [00:16:36] Speaker 01: In other words, whether the content was such that it was more of one and less than the other, or that it was or wasn't relevant, it's not there. [00:16:44] Speaker 03: But you're not saying that it required discussion when it was so conspicuous. [00:16:49] Speaker 01: I think it does absolutely require discussion. [00:16:51] Speaker 01: You can't come to the end result that the product doesn't contain additional pieces. [00:16:56] Speaker 01: Mysteriously, these plastic injection end caps, they transform into fasteners. [00:17:01] Speaker 01: If that was going to be a finding by Commerce, then they should have said so. [00:17:05] Speaker 01: And then when given the opportunity to do so on remand, they did not. [00:17:14] Speaker 01: The scope excludes finished merchandise and containing aluminum extrusions as parts that are fully and permanently assembled and completed at the time of entry. [00:17:25] Speaker 01: So we have a handle that's permanently and fully assembled and completed at the time of entry. [00:17:32] Speaker 01: And we have five pieces, the two end caps, the screws that are used to attach the end caps to the handle itself, and the aluminum extrusion. [00:17:41] Speaker 01: And Commerce made a finding of fact that was contradicted by all of the evidence in the case. [00:17:46] Speaker 01: And that is that there were only screws and aluminum extrusions when, in fact, there were additional pieces. [00:17:52] Speaker 01: So the problem began with Commerce's scope ruling and its description, where it describes all of the type B product. [00:18:00] Speaker 01: And then it gets to the end, and it says it consists entirely of aluminum extrusions, with the exception of fasteners. [00:18:06] Speaker 01: When our ruling request didn't mention fastening or fasteners in it, [00:18:11] Speaker 01: And Commerce took the plastic end caps out of the equation with no explanation and no finding. [00:18:18] Speaker 01: And so somehow this metamorphosis is what Judge Stansu had a problem with. [00:18:25] Speaker 01: And Judge Stansu looked at the court schematic when reaching its decision. [00:18:30] Speaker 01: And the problem for the court was that Commerce forgot about these end caps. [00:18:34] Speaker 01: I mean, that's the summary of it. [00:18:36] Speaker 01: And because they did not describe it, there wasn't enough facts [00:18:41] Speaker 01: to support Congress's conclusion. [00:18:43] Speaker 01: There wasn't substantial evidence on the record as regarding this and adequate support for it. [00:18:50] Speaker 01: And to the extent that, you know, the appellant is claiming that somehow the assembly fails to satisfy the finished merchandise exception, the five pieces attached together included in a package with screws and instructions for a product to attach to an oven, well, that would be a final product and nothing needs to be done [00:19:09] Speaker 01: other than attach it. [00:19:10] Speaker 01: And that's the analogy that they're attempting to make, that there should be some additional input. [00:19:16] Speaker 01: Well, that's one of the articles that is excluded from a finished product in the exclusion order are windows. [00:19:22] Speaker 01: And that's somehow saying that a finished window isn't complete because it needs to be attached to the home, or the home is the additional article. [00:19:32] Speaker 01: That seems to be a strange argument. [00:19:34] Speaker 01: the scope order for finished goods specifically says windows are excluded. [00:19:38] Speaker 01: It makes no reference to the fact that a window has no purpose. [00:19:40] Speaker 02: Well, a finished good would be an oven, right? [00:19:43] Speaker 02: Sure. [00:19:44] Speaker 02: With all the handles and everything on it, but you still have to install the oven. [00:19:49] Speaker 01: I would say that an oven handle is not a sub-assembly to an oven. [00:19:53] Speaker 01: You know, it's not an integral piece that is the working or the nature of the oven that is needed like the [00:19:58] Speaker 01: the ignition to a gas stove. [00:20:00] Speaker 02: Can you open a hot oven without a handle? [00:20:02] Speaker 01: Sure. [00:20:03] Speaker 01: You could not. [00:20:04] Speaker 01: At the same time, if you're going to change out as a decorative piece, do you want a stainless steel oven handle, or would you like a black oven handle? [00:20:12] Speaker 01: And this is one of the things that, as an aesthetic measure, you would change out. [00:20:16] Speaker 01: It's a finished article for an aesthetic purpose. [00:20:19] Speaker 03: Let me ask you, Judge Rand has asked a question that brings us back, I think, to the issue here. [00:20:25] Speaker 03: How do you reconcile [00:20:28] Speaker 03: the fact that under the CIT's interpretation, if the plastic end pieces were unattached and imported in a kit with a handle, then it would be within the scope of the order. [00:20:41] Speaker 03: That is, the only difference seems to be whether it's attached or unattached. [00:20:44] Speaker 01: I would say that it would qualify in the finished goods kit. [00:20:48] Speaker 01: That isn't the facts before us. [00:20:49] Speaker 01: We're dealing with a finished good. [00:20:51] Speaker 01: But if it was unassembled, then we have the finished goods kit exclusion. [00:20:55] Speaker 01: And so in that circumstance, I would say it would be a finished goods kit. [00:20:59] Speaker 03: So he says, how do you reconcile this difference in treatment, in customs treatment? [00:21:05] Speaker 01: Yes, it would be if we were to change the import analyses, unassemble that product, put it in a bag, then we have a finished good that would be subject to the finished good kit. [00:21:17] Speaker 03: So you're saying it can't be reconciled? [00:21:20] Speaker 01: It can't be. [00:21:21] Speaker 01: It goes either in the finished good kit, if assembled, [00:21:24] Speaker 01: or the finished good kit exclusion if unassembled. [00:21:28] Speaker 02: So in one instance, it falls within a specific exclusion, and the other, it just falls outside the scope. [00:21:33] Speaker 03: Correct. [00:21:34] Speaker 03: Well, that's what was held. [00:21:36] Speaker 03: And it does seem like a curious result. [00:21:39] Speaker 03: Does it not? [00:21:40] Speaker 03: No, it does not. [00:21:42] Speaker 01: Well, the scope of the orders is as written. [00:21:44] Speaker 01: It's not our place to determine beyond the scope of the language of the orders. [00:21:48] Speaker 01: So it's there. [00:21:49] Speaker 01: It's there. [00:21:49] Speaker 01: And does it meet the exclusion on its face? [00:21:52] Speaker 01: Or does it not? [00:21:53] Speaker 01: And we have an assembly that's finished, that's imported as a finished assembly. [00:21:58] Speaker 01: It meets the scope of the exclusion. [00:22:04] Speaker 01: So even, and this applies to a downstream product, and that was the heart of the SMBC ruling, when a product requires no further fabrication, that you have a finished good, and again, in drapery rail kits, it would be a little bit silly to say, [00:22:18] Speaker 01: that you need to have curtains imported with a drapery rail kit in order for it to be a finished good. [00:22:23] Speaker 01: A drapery rail kit is customized for products, so obviously there are instances in which you are importing something that has a future use that does not contain all of the elements, such as draperies on a drapery rail kit. [00:22:36] Speaker 01: And these oven handles are really only suitable for a specific application, as was the case with the anodes ruling and solar mounts attached to solar panels. [00:22:47] Speaker 01: And so the last thing that is said in the brief is that this is somehow a roadmap for circumvention. [00:22:55] Speaker 01: I would say that would be just to the contrary. [00:22:57] Speaker 01: What really is the case for importers is they need to have reliability. [00:23:01] Speaker 01: They need to know how their product either complies or does not comply with an anti-dumping duty orders, given the huge amount that is at issue with an anti-dumping duty or countervailing duty order [00:23:15] Speaker 01: And so what we need is some sort of certainty. [00:23:17] Speaker 01: We need to be able to read a ruling and say, this is the result. [00:23:20] Speaker 01: And when commerce misses a step and doesn't explain how it got from A to B and misses up parts of a product in its scope ruling, that doesn't give the kind of certainty and finality that an importer needs in making its decision. [00:23:35] Speaker 01: And I want to be careful that we aren't dealing with a sub-assembly here. [00:23:40] Speaker 01: There's been some loosey language about [00:23:42] Speaker 01: This being a sub-assembly, this isn't a sub-assembly. [00:23:44] Speaker 01: This isn't a partially assembled product. [00:23:47] Speaker 01: This is a finished assembly. [00:23:49] Speaker 01: And I think that that's all I have for the court, unless you have some additional questions for me. [00:23:56] Speaker 03: No? [00:23:56] Speaker 03: OK. [00:23:56] Speaker 03: Thank you. [00:24:01] Speaker 03: Mr. DeFrancisco? [00:24:02] Speaker 00: Thank you, Your Honor. [00:24:04] Speaker 00: Just quickly, I'd like to address a few quick points. [00:24:07] Speaker 00: Yes, the Department of Commerce did in fact find that these end caps were fasteners at page two of its original scope determination. [00:24:13] Speaker 00: It's Appendix 60. [00:24:14] Speaker 00: I'll quote, the end caps are used to fasten the handle to the door. [00:24:19] Speaker 00: Then if you go to page 12 of the decision, when it talks about the department's position, paragraph two there, aside from the inclusion of fasteners for type B handles, at that point when the department found that the end caps were used to fasten to the door, [00:24:36] Speaker 00: When it talks about fasteners, it's talking about the screws in the end caps. [00:24:40] Speaker 00: And so it did find that they were fasteners. [00:24:42] Speaker 00: Why did it find that they were fasteners? [00:24:43] Speaker 00: Because the respondent in its petition said the end caps are used to fasten the handle to the oven door. [00:24:50] Speaker 00: It has to be a fastener. [00:24:51] Speaker 00: You cannot attach that handle to the oven door without the end cap. [00:24:54] Speaker 00: Therefore, it's a fastener, as you pointed out. [00:24:57] Speaker 00: Quickly. [00:24:58] Speaker 02: Do you see no difference between A, B, and C? [00:25:01] Speaker 00: No, I do not. [00:25:02] Speaker 00: They're all covered in merchandise. [00:25:05] Speaker 00: Just quickly, Judge Raina's question about isn't wouldn't this would lead to inconsistent decisions. [00:25:11] Speaker 00: Yes, it would. [00:25:12] Speaker 00: If you find. [00:25:13] Speaker 03: If not, not necessarily inconsistent, but curious. [00:25:17] Speaker 00: Curious, sure. [00:25:18] Speaker 00: We would say inconsistent and inappropriate conclusions. [00:25:20] Speaker 00: The end cap here is a fastener. [00:25:23] Speaker 00: Okay. [00:25:23] Speaker 00: If it's a fastener and it's attached to the handle, under their interpretation, it's out as a finished good. [00:25:29] Speaker 00: Yet if it were not attached to the handle, it was a kit, it'd be subject to the [00:25:33] Speaker 00: product because it's not attached and it's a fastener. [00:25:36] Speaker 00: You can't have two different interpretations of the same exclusion. [00:25:39] Speaker 00: And Commerce has consistently, when interpreting both the finished goods kit and the finished goods exclusion, has said these are essentially two of the same things. [00:25:50] Speaker 00: One happens to be assembled and one is unassembled, but in a sense is a finished good and therefore would be excluded. [00:25:57] Speaker 00: This end cap is a fastener and it has to be subject merchandise, whether it was attached to it or not. [00:26:04] Speaker 00: And then again, as we've said, the mere fact that it's an assembly doesn't take it out of the definition of the scope. [00:26:11] Speaker 00: It is an extruded product that meets the definition of the scope, defined by its end use here as a handle. [00:26:17] Speaker 00: The second step would be whether it meets any of the definitions of the exclusions, but the lower court didn't get there. [00:26:23] Speaker 00: The lower court simply concluded that this doesn't meet the definition of a fastener and went on from there. [00:26:31] Speaker 00: getting to their point about fasteners having to come off the shelf from a hardware store that is not found in the language of the scope that's what the lower court how it interpreted what it meant by fastener new positive that is inappropriate to the extent the lower court had a problem with what is meant by fastener it's for commerce using its interpretive guidance under k1 to determine [00:26:54] Speaker 00: with respect to this scope, what is meant by fasteners? [00:26:56] Speaker 02: But in fairness, the lower court said that they're not fasteners because they are molded parts that are actually part of the assembly. [00:27:07] Speaker 02: And then you still have to separately fasten them to something. [00:27:11] Speaker 00: It's a molded part that's attached to the extrusion that's then used to fasten that handle to the oven. [00:27:20] Speaker 00: Without that molded part, you couldn't have attached that handle to that oven. [00:27:24] Speaker 00: And they admit that. [00:27:25] Speaker 00: They said the NCAP is used to attach the handle to the oven. [00:27:29] Speaker 00: That's a fastener. [00:27:30] Speaker 00: Whether it's a molded part or not, it's still fastening that handle to the oven. [00:27:34] Speaker 02: The problem is that the scope order was just not clearly written and that the lower court just felt that, you know, that language was chosen by commerce and they can't then just morph it into something else. [00:27:49] Speaker 00: Your Honor, to the extent the lower court felt the [00:27:51] Speaker 00: language wasn't clear with respect to what was meant by fastener, the lower court should have asked Commerce, using the K-1 analysis, to go through its interpretive guidance to determine what's meant by fastener. [00:28:03] Speaker 00: It didn't do that. [00:28:04] Speaker 00: It simply said, I don't believe under its analysis what's meant by fastener. [00:28:09] Speaker 02: But you said the common and ordinary meaning of the term just doesn't allow such a broad reading. [00:28:13] Speaker 00: But with all due respect, Your Honor, common and ordinary meaning is not necessarily part of the [00:28:18] Speaker 00: commerce's regulations as to how it interprets a scope and whether something's ambiguous or not. [00:28:25] Speaker 00: It's supposed to refer to the petition language and the other elements that go into interpreting that scope. [00:28:30] Speaker 00: And in the petition, frankly, the language about what is meant by a fastener is broad. [00:28:36] Speaker 00: It's beyond the sort of off-the-shelf hardware that the respondents have claimed. [00:28:41] Speaker 00: I see my time is almost up, unless you have any other questions. [00:28:45] Speaker 03: Any more questions? [00:28:47] Speaker 03: Okay, thank you. [00:28:48] Speaker 03: Thank you both. [00:28:49] Speaker 03: The case is taken under submission. [00:28:51] Speaker 03: And that concludes the argued cases for this session.