[00:00:00] Speaker 04:
All right, our first case for argument is 23-1078.

[00:00:06] Speaker 04:
All one godforsaken person in the United States, Mr. Kirby.

[00:00:10] Speaker 03:
May it please the court.

[00:00:12] Speaker 03:
Good morning.

[00:00:13] Speaker 03:
My name is Kyle Kirby.

[00:00:16] Speaker 03:
I'm Kyle J. Kirby, attorney and counselor at Law PC.

[00:00:19] Speaker 03:
I represent Ascension Chemicals LLC, Globe Energy Corporation, UMB Solutions LLC, and Crude Chem Technology LLC.

[00:00:29] Speaker 03:
collectively the consolidated appellants.

[00:00:32] Speaker 03:
Thank you for this oral argument opportunity.

[00:00:36] Speaker 03:
Something doesn't smell right concerning this case regarding the lack of jurisdiction over Globe's entries.

[00:00:43] Speaker 03:
CBP not referring the covered merchandise question to Commerce and CBP's application of its adverse inference.

[00:00:52] Speaker 03:
In the latest case addressing jurisdiction, the Court of Appeals of International Trade in Royal Brush Manufacturing v. U.S.

[00:00:59] Speaker 03:
19.198, slip-off 23.177 at 13, acknowledged that based on the court's language in Royal Brush Manufacturing v. U.S.

[00:01:11] Speaker 03:
75.4.

[00:01:12] Speaker 01:
Council?

[00:01:13] Speaker 03:
Yes, ma'am.

[00:01:14] Speaker 01:
If you turn to Phoenix page 19, can you tell me the import of footnote 9 on your argument?

[00:01:22] Speaker 03:
Page 19 of the original brief.

[00:01:27] Speaker 01:
Appendix page 19.

[00:01:29] Speaker 01:
Appendix page 19, sure.

[00:01:35] Speaker 01:
Do you have access to the appendix?

[00:01:52] Speaker 03:
OK.

[00:01:54] Speaker 01:
What is the import of footnote 9 on your jurisdiction argument?

[00:01:58] Speaker 03:
I'm sorry, what is that again?

[00:02:00] Speaker 01:
What is the import of footnote 9?

[00:02:01] Speaker 01:
Do you see footnote 9?

[00:02:03] Speaker 03:
Footnote 9.

[00:02:13] Speaker 01:
Yes.

[00:02:16] Speaker 01:
What is the import of that footnote on your jurisdiction argument?

[00:02:20] Speaker 03:
The import would be xanthan gum.

[00:02:25] Speaker 01:
I didn't mean it as a pun.

[00:02:29] Speaker 01:
I meant, what do you think the effect is of Putno 9 in a jurisdiction argument?

[00:02:36] Speaker 03:
Well, obviously, the CIT determined that it did not have jurisdiction over the entries because they were already liquidated.

[00:02:47] Speaker 04:
Yeah, but I think that Putno 9, as Presley says, that even if we did have jurisdiction, you wouldn't still lose.

[00:02:55] Speaker 02:
On the merits?

[00:02:56] Speaker 03:
That is correct.

[00:03:00] Speaker 02:
But we can't presume jurisdiction if the court has dismissed jurisdiction, can we?

[00:03:09] Speaker 03:
No.

[00:03:10] Speaker 03:
I guess that's why we're here today.

[00:03:11] Speaker 03:
Right.

[00:03:12] Speaker 02:
But I'm a little baffled by why you didn't file

[00:03:19] Speaker 02:
a lawsuit after customs denied your protest against the liquidated entries.

[00:03:25] Speaker 03:
Simply put, my client couldn't pay the play.

[00:03:28] Speaker 02:
Well, that's what's necessary to perfect jurisdiction.

[00:03:30] Speaker 02:
Your other clients did perfect jurisdiction and got a ruling on the merits under C. There's no exception for can't pay for jurisdiction, is there?

[00:03:44] Speaker 03:
No, actually there is not.

[00:03:46] Speaker 02:
I just fail to understand how we have jurisdiction over liquidated entries that became final because you failed to file a lawsuit.

[00:03:57] Speaker 02:
And you weren't prevented from doing that.

[00:03:59] Speaker 02:
In fact, you started to perfect the process.

[00:04:03] Speaker 02:
You filed a protest of the improperly liquidated entries.

[00:04:07] Speaker 02:
Customs denied it.

[00:04:09] Speaker 02:
If you'd filed a lawsuit, you could have asked for an injunction to suspend them during the course of the seat proceedings.

[00:04:15] Speaker 03:
Actually, we did submit for an injunction.

[00:04:18] Speaker 02:
Yes, but the entries were already liquidated.

[00:04:21] Speaker 02:
Once they're liquidated, the court can't do anything, can they?

[00:04:25] Speaker 03:
Well, I think there's still an open question, right?

[00:04:30] Speaker 03:
did the evasion occur, or did it occur but at a much lower rate?

[00:04:37] Speaker 02:
But it didn't matter.

[00:04:38] Speaker 02:
If the court doesn't have jurisdiction, because the injuries have already been liquidated, whether evasion occurred or not is irrelevant, because they can't order liquidation when you didn't perfect jurisdiction.

[00:04:54] Speaker 02:
Even if there had been a finding of no evasion on the merits order, you'd be out on the liquidated ones, wouldn't you?

[00:05:00] Speaker 02:
Well, not maybe for- What's the basis?

[00:05:03] Speaker 02:
I'm sorry?

[00:05:03] Speaker 02:
What would it be the basis to order reliquidation?

[00:05:06] Speaker 03:
So in the brief, really the reliance would be on the Shinae court- What's the jurisdictional basis in Shinae?

[00:05:19] Speaker 02:
Isn't it an I case?

[00:05:20] Speaker 02:
I believe it's an A.

[00:05:22] Speaker 02:
And what was the basis for that though?

[00:05:25] Speaker 02:
It was that customs liquidated ministerially and there was nothing to protest.

[00:05:31] Speaker 02:
Here there was something to protest because you did.

[00:05:33] Speaker 02:
And the customs denied it.

[00:05:37] Speaker 02:
In Chenier, there was no protestable decision or something like that, I think.

[00:05:43] Speaker 03:
So the Federal Circuit and CIT President dictate that the CIT's broad remedial powers include the power to issue refunds on entries and other remedies, regardless of the liquidation status.

[00:05:56] Speaker 02:
Well, that's not true in the broadest sense of that statement.

[00:05:58] Speaker 02:
We've held repeatedly that if an entry is liquidated and becomes final, the court doesn't have jurisdiction under A.

[00:06:06] Speaker 02:
There may be narrow exceptions to that.

[00:06:08] Speaker 02:
But that's in a case where it was not possible to protest it or otherwise perfect jurisdiction.

[00:06:15] Speaker 02:
You clearly could have perfected jurisdiction here because you did for your other clients.

[00:06:21] Speaker 03:
That is true.

[00:06:23] Speaker 03:
But we also do see the differences between the commerce statute and that of EVA.

[00:06:31] Speaker 03:
So commerce allows for a court injunction.

[00:06:37] Speaker 03:
Section 1517 does not.

[00:06:40] Speaker 03:
There's also an implementing regulation that allows customs.

[00:06:44] Speaker 02:
Was there not an injunction here with regard to the entries the court got to the merit sign?

[00:06:49] Speaker 02:
No.

[00:06:49] Speaker 02:
Liquidation was suspended.

[00:06:51] Speaker 03:
Liquidation was suspended up until the point where before the case was decided, or before the administrative piece was decided, customs liquidated the entries.

[00:07:08] Speaker 02:
I'm not talking about the ones they found lack of jurisdiction on.

[00:07:11] Speaker 02:
I'm talking about the ones there was jurisdiction on.

[00:07:13] Speaker 02:
Yes.

[00:07:14] Speaker 02:
Those weren't liquidated before the court reached its decision.

[00:07:20] Speaker 03:
They were liquidated after the court reached its decision.

[00:07:24] Speaker 03:
We filed a protest for those.

[00:07:27] Speaker 03:
And the protest was suspended until after the decision.

[00:07:32] Speaker 02:
So the liquidation wasn't final.

[00:07:35] Speaker 02:
Arguably?

[00:07:37] Speaker 02:
Not arguably.

[00:07:38] Speaker 02:
If you file a protest and it's suspended, there's no final decision.

[00:07:44] Speaker 02:
The final decision is after protest.

[00:07:46] Speaker 02:
I am just completely confused why some of your clients did the right thing and one of them didn't.

[00:07:58] Speaker 03:
Well, they didn't have to pay because customs suspended the protest.

[00:08:03] Speaker 02:
Again, it doesn't matter.

[00:08:07] Speaker 02:
Just the way it works.

[00:08:08] Speaker 02:
If customs liquidates, they liquidate.

[00:08:12] Speaker 02:
And then you can get it suspended.

[00:08:14] Speaker 02:
You could have gotten it suspended.

[00:08:16] Speaker 02:
You agreed to that, don't you?

[00:08:18] Speaker 02:
We tried, actually.

[00:08:19] Speaker 02:
No, you didn't.

[00:08:20] Speaker 02:
You didn't file after customs denied the protest in court.

[00:08:24] Speaker 02:
So that decision became final.

[00:08:28] Speaker 04:
Am I correct in understanding that this pertains, this jurisdictional question pertains to some of the entries, but there are other entries where there is not a jurisdictional question?

[00:08:38] Speaker 04:
Correct.

[00:08:39] Speaker 04:
Okay.

[00:08:39] Speaker 04:
So can you, would you mind if we want to cover merchandise?

[00:08:44] Speaker 04:
Sure.

[00:08:44] Speaker 04:
Because that pertains, I think, to the entries that aren't possibly covered by the jurisdictional question.

[00:08:50] Speaker ?:
Yes.

[00:08:51] Speaker 03:
Again, something doesn't smell right with CP Calgo's petitioner in the EPA allegations.

[00:08:58] Speaker 03:
Mostly absent in these proceedings, the same ledger had a 0% rate in the same Cheyenne Xanthan case.

[00:09:05] Speaker 01:
But yet... Council, do you agree that the merchandise at issue was subject to the anti-dumping order on Xanthan gone at the time of entry?

[00:09:15] Speaker 03:
Technically, yes.

[00:09:18] Speaker 01:
Are you trying to equivocate in some way?

[00:09:20] Speaker 01:
Because you picked the word technically in front of that.

[00:09:23] Speaker 03:
Well, we believe that customs should have referred the matter to commerce, because there was a question regarding the covered merchandise.

[00:09:34] Speaker 04:
But I think the statute 1517B4A says that CBP only has to refer a matter if they're unable to determine whether the merchandise was covered.

[00:09:46] Speaker 04:
But here, it doesn't seem like they were unable to.

[00:09:50] Speaker 04:
They're not required to refer the matter.

[00:09:52] Speaker 04:
It's only if they're unable to make the determination under the statute and they seem to be able to make it here.

[00:09:57] Speaker 04:
So what's your argument about why this is not covered in merchandise and why should they have had to refer something when they were able to make the determination and it's not mandatory?

[00:10:07] Speaker 03:
So there's significant evidence that shows a change in circumstances.

[00:10:13] Speaker 02:
But that's not something customs can do.

[00:10:16] Speaker 03:
No, that would be on commerce.

[00:10:18] Speaker 02:
If you had an argument to change circumstances, you could have asked commerce for some kind of redetermination, right?

[00:10:27] Speaker 02:
I assume your argument is that there was no longer a domestic industry and so commerce should have modified the order to only cover non-petroleum or whatever it is, xanthan gum.

[00:10:40] Speaker 02:
Yes.

[00:10:41] Speaker 02:
But customs can't do any of that and they don't have an obligation to figure out if commerce needs to do something.

[00:10:49] Speaker 02:
That's you.

[00:10:50] Speaker 02:
All they have to do is read the order and say this applies to xanthan gum coming from China.

[00:10:56] Speaker 03:
But they did have the evidence in front of them.

[00:10:59] Speaker 02:
Point me in the statute where it says, Customs has a legal duty to refer possible change circumstances to commerce.

[00:11:10] Speaker 03:
That would be in 1517.

[00:11:44] Speaker 04:
I mean, I think B4 usually covers definite referral.

[00:12:08] Speaker 04:
Could be wrong.

[00:12:09] Speaker 04:
I don't see where it makes it mandatory.

[00:12:12] Speaker 03:
No, it says that the language is not mandatory.

[00:12:16] Speaker 03:
It said they can file it.

[00:12:18] Speaker 00:
Well, if it's not mandatory, then they have no obligation to do it.

[00:12:23] Speaker 03:
Under a certain requirement, yes.

[00:12:25] Speaker 03:
But they had the evidence in front of them.

[00:12:27] Speaker 02:
So what?

[00:12:28] Speaker 02:
Plainly.

[00:12:29] Speaker 02:
You had not, was there anything that prevented you from initiating a procedure with commerce saying there is no longer a domestic market and so this should be amended to exclude petroleum products or whatever?

[00:12:44] Speaker 03:
I don't think that it's actually been an instance that I could find where an importer actually went and was able to get exchange circumstances.

[00:12:54] Speaker 02:
So what?

[00:12:55] Speaker 02:
Again, has there ever been an instance where a court has said an importer is not allowed to do this?

[00:13:01] Speaker 03:
No, but it hasn't been in front of them.

[00:13:03] Speaker 03:
Neither has in Congress.

[00:13:05] Speaker 02:
But the regulation is... The language you're pointing us to doesn't impose any kind of mandate.

[00:13:11] Speaker 02:
So that can't save you from customs determination.

[00:13:18] Speaker 02:
If they don't have an obligation, they don't have an obligation.

[00:13:21] Speaker 02:
So do you have anything on the actual merits of

[00:13:24] Speaker 02:
whether this xanthan gum actually came from China or not.

[00:13:30] Speaker 02:
I mean, it clearly came from China, right?

[00:13:31] Speaker 02:
Correct.

[00:13:32] Speaker 02:
OK.

[00:13:32] Speaker 02:
Well, then you're out.

[00:13:33] Speaker 02:
The anti-gumping order applies to xanthan gum from China.

[00:13:37] Speaker 02:
You have to pay the duties.

[00:13:38] Speaker 02:
Until you get a change circumstance ruling, you have to pay the duties.

[00:13:43] Speaker 04:
OK.

[00:13:43] Speaker 04:
Well, you have a minute and a half left, and you're using most of your ball time.

[00:13:47] Speaker 04:
Would you like to stay for a remainder?

[00:13:49] Speaker 04:
No, no.

[00:13:49] Speaker 04:
No?

[00:13:50] Speaker 04:
You don't want to stay for a remainder?

[00:13:51] Speaker 04:
Oh, no.

[00:13:52] Speaker 04:
I'll continue.

[00:13:53] Speaker 03:
Oh, OK.

[00:13:53] Speaker 03:
OK.

[00:13:53] Speaker 03:
Yes.

[00:13:56] Speaker 04:
You don't want to save any rebuttal time?

[00:13:59] Speaker 04:
No.

[00:13:59] Speaker 04:
Okie doke.

[00:14:03] Speaker 02:
I don't think we have any more questions.

[00:14:05] Speaker 02:
Why don't you sit down and let the government argue and you can have a minute and a half left to respond.

[00:14:09] Speaker 02:
Fair enough.

[00:14:19] Speaker 05:
Good morning, Your Honors.

[00:14:20] Speaker 05:
I'll start first with the liquidation question.

[00:14:22] Speaker 05:
The trial court correctly dismissed Globe's case because there were no unliquidated entries at issue.

[00:14:31] Speaker 05:
Congress specifically set forth the statutory.

[00:14:34] Speaker 02:
Can you clear up for me how this worked with regards to the entries that they actually got to the merits on?

[00:14:41] Speaker 02:
Because this is a relatively new statute, so I'm not completely familiar with it.

[00:14:48] Speaker 02:
Customs made the determination and said these are evasion.

[00:14:53] Speaker 05:
Correct.

[00:14:53] Speaker 02:
How did they get suspended so that the CIT could hear the marriage challenge?

[00:14:59] Speaker 05:
The parties thought of preliminary injunction for the entries that were not liquidated.

[00:15:04] Speaker 05:
The trial court at ECF number 54

[00:15:06] Speaker 05:
filed an order suspending the liquidation during the contingency of the trial for its proceeding.

[00:15:12] Speaker 05:
As Your Honor noted earlier, unfortunately, the entries had liquidated for a globe.

[00:15:18] Speaker 05:
That liquidation was protested, but there was never an appeal perfected.

[00:15:23] Speaker 05:
Those liquidated prior to

[00:15:25] Speaker 05:
the trial court in this case issuing the order, suspending the liquidation for all of the other cases.

[00:15:30] Speaker 02:
If they filed a lawsuit under A, they could have been included in that.

[00:15:34] Speaker 05:
Absolutely.

[00:15:35] Speaker 05:
And that's precisely the government's point, that the statutory scheme set forth is that for an importer to do that, to take advantage of the protest and appeal jurisdiction under A. In this case.

[00:15:46] Speaker 02:
I mean, that's what happens in normalcy cases, too, right?

[00:15:49] Speaker 02:
They have to don't encounter bailing duties.

[00:15:51] Speaker 02:
commerce issues of final order, assessing duties, or, you know, doing the review periods, and any liquidations covered by that are suspended administratively at commerce, I think, and then when commerce is a decision, the parties have to seek an injunction from the court to continue it.

[00:16:10] Speaker 05:
Exactly.

[00:16:10] Speaker 05:
It's very, it's materially the same.

[00:16:13] Speaker 05:
operating liquidation alongside the C cases.

[00:16:17] Speaker 02:
So this doesn't fall, I know we have some kind of oddball cases where we've allowed the CIT to take jurisdiction over liquidated entries that were subject to a final decision.

[00:16:30] Speaker 05:
This does not fall under that.

[00:16:31] Speaker 05:
Those have only ever been permitted under I cases like Shanae or Shanae.

[00:16:37] Speaker 05:
Royal Brush is an outlier, but materially different on the facts than this case, because in that case, this court permitted jurisdiction to continue for entries that had liquidated with no duties.

[00:16:53] Speaker 05:
And so that's separate from this court's line of cases under 1581C, ever since Zenith, all the way through SKF and beyond, where this court has held when duties are liquidated with entries, excuse me,

[00:17:06] Speaker 05:
When entries are liquidated with duties such that it becomes final and conclusive, there's no jurisdiction because there's no longer any relief that the trial court can award to someone seeking review at the CIT.

[00:17:21] Speaker 05:
And so in royal brush, unique circumstance because it's

[00:17:25] Speaker 05:
It's rarely going to be the case where we have entries that have liquidated and litigation proceeds.

[00:17:31] Speaker 05:
It was just essentially an oversight from the government and the parties.

[00:17:34] Speaker 05:
We didn't realize until it was up to this court.

[00:17:37] Speaker 05:
So do you think there shouldn't have been jurisdiction in Brown Rush?

[00:17:42] Speaker 05:
What is your position on that?

[00:17:45] Speaker 05:
In fact, in the remand to the Court of International Trade, Chief Judge Barnett held there was no jurisdiction because there were no active entries and there was no additional relief that the trial court could have awarded to Royal Brush.

[00:18:00] Speaker 05:
That was not appealed and it's now become final.

[00:18:02] Speaker 05:
This case, however, is distinct because there were entries that were liquidated with duties and so this falls under the court's

[00:18:09] Speaker 05:
long-standing precedent from Zenith, et cetera.

[00:18:13] Speaker 02:
Can you tell me why, when Customs found out these entries were improperly liquidated, they didn't just resuspend them?

[00:18:24] Speaker 05:
Sure, Your Honor.

[00:18:25] Speaker 05:
Customs is permitted to reliquidate under Subsection 1501 within a specified timeframe of 90 days that had passed.

[00:18:36] Speaker 05:
Essentially, it was a Customs error.

[00:18:38] Speaker 05:
But Congress again set forth a remedy when customs makes those errors and that's the protest and appeal procedure So it was simply a mistake on customs part, but they didn't have any authority to

[00:18:51] Speaker 02:
do anything about it because of time period.

[00:18:53] Speaker 05:
That was its position, Your Honor.

[00:18:55] Speaker 05:
Yes.

[00:18:55] Speaker 02:
Right.

[00:18:55] Speaker 02:
And so the administrative exhaustion procedures of protest, final decision, and court case kicked in.

[00:19:00] Speaker 05:
Exactly, Your Honor.

[00:19:02] Speaker 04:
That was it.

[00:19:02] Speaker 04:
What if I put no 9 here?

[00:19:04] Speaker 04:
It seems like a felon suspenders sort of situation, right?

[00:19:10] Speaker 05:
Sure.

[00:19:10] Speaker 05:
I think, though, Your Honors, that the court has to address the jurisdictional issue.

[00:19:15] Speaker 05:
I think that if the court were to disagree with us... I say the court has to address the jurisdictional issue.

[00:19:20] Speaker 04:
Certainly, the CIT had an obligation to address the jurisdictional issue.

[00:19:24] Speaker 04:
But why do we... This is not a question of our jurisdiction.

[00:19:27] Speaker 04:
We clearly have jurisdiction to review the decision below.

[00:19:31] Speaker 04:
below the outcome would be the same regardless of whether we adopted the jurisdictional posture or merits-based posture.

[00:19:39] Speaker 04:
Why?

[00:19:39] Speaker 04:
Are you suggesting to me that law requires me to address the lower tribunal's decision on jurisdiction?

[00:19:45] Speaker 05:
I think, Your Honor, quite the opposite, that Your Honors only have to reach the issues that are necessary to resolve, to sustain or remand the case.

[00:19:55] Speaker 05:
And here, the trial court did, of course,

[00:20:00] Speaker 05:
dismiss the case for lack of jurisdiction, and that specific issue is appealed, the appellant doesn't make any argument on the merits for Globe.

[00:20:07] Speaker 05:
So I think the issue before, Your Honors, is whether the trial court correctly determined there was jurisdiction.

[00:20:13] Speaker 05:
Now, I think Your Honors could probably say it doesn't matter either way.

[00:20:17] Speaker 05:
Because we affirm the evasion determination, and the trial court held that as loathe as well.

[00:20:23] Speaker 02:
So you think we can assume there was jurisdiction and then decide on the merits?

[00:20:28] Speaker 02:
I thought there was precedent to the contrary, that you just can't assume jurisdiction.

[00:20:32] Speaker 02:
You have to address the jurisdictional issues first.

[00:20:35] Speaker 05:
Yeah, I don't think, Your Honor, and I don't mean to suggest the court should or can assume jurisdiction.

[00:20:41] Speaker 02:
But if we're getting to the merits, we have to assume

[00:20:44] Speaker 02:
for purposes of argument, even if we would otherwise find differently, that there is jurisdiction and go ahead and inform all Americans, I think.

[00:20:52] Speaker 05:
That's fair, Your Honor.

[00:20:53] Speaker 05:
I think now that we've talked this out, it would be appropriate for the court to address Globe's appeal.

[00:20:59] Speaker 05:
And the issue on appeal, as it relates to Globe, is whether the trial court correctly dismissed its claim for lack of jurisdiction.

[00:21:07] Speaker 05:
The court could then go on to say, even if we're incorrect,

[00:21:10] Speaker 04:
uh... we use the same and i want to hear answers from you because you're bopping up all around on this do we have an obligation to address the jurisdictional issue or can we affirm given that they made no arguments on the merits alternative basis

[00:21:29] Speaker 04:
This court held no jurisdiction, and even if there's jurisdiction, they lose on the merits.

[00:21:34] Speaker 04:
They haven't appealed that merits-based determination.

[00:21:37] Speaker 04:
So are you telling me, as an impelled court, that I am bound, I am required to, in the first instance, address the lower court's jurisdiction?

[00:21:47] Speaker 04:
I know I'm required to address my own jurisdiction, but I don't understand that I'm required to address the lower court's jurisdiction if there's an alternative basis which hasn't been properly appealed.

[00:21:58] Speaker 05:
i think you're asking only reached the alternative basis if it first addressed the jurisdiction uh... because they are you believe that's important for i have an obligation to first determined whether or not you know decided properly question their own jurisdiction before I can address the merits I think that's correct your honor do you have a case for that?

[00:22:19] Speaker 05:
I don't have a case for that I apologize and we can of course provide supplemental authority to your honors later today uh... but the court

[00:22:27] Speaker 05:
in reaching the merits, does what Judge Hughes characterized as assumed jurisdiction.

[00:22:33] Speaker 05:
And I think in this case, where the trial court correctly held that there was no jurisdiction, there's really no basis, I suppose, to get to the merits without... Well, you're assuming that I think it's correct that there was no jurisdiction.

[00:22:45] Speaker 05:
That's correct.

[00:22:46] Speaker 05:
But jurisdiction is a threshold issue, as Your Honors know.

[00:22:48] Speaker 02:
I mean, if we thought that trial court was wrong on jurisdiction, we could say that and then go ahead and affirm on the merits.

[00:22:55] Speaker 05:
That's correct.

[00:22:57] Speaker 05:
given footnote nine in the trial court's order.

[00:23:00] Speaker 05:
That's correct.

[00:23:01] Speaker 01:
I want to briefly touch on a different issue, adverse inferences in particular.

[00:23:07] Speaker 01:
So let's just assume for now that maybe we disagree with this application of adverse inferences.

[00:23:13] Speaker 01:
Can you talk me through what, if any, independent support there is in the record to lead to never?

[00:23:19] Speaker 05:
absolutely your honor and in fact the de novo review determination didn't in fact rely on adverse inferences.

[00:23:27] Speaker 05:
Customs said it would be appropriate to apply the adverse inferences so there's sufficient factual support.

[00:23:33] Speaker 05:
That comes in the form of the allegation, the allegation which cited

[00:23:37] Speaker 05:
information from the International Trade Commission that says that the gum cannot or is not produced in India.

[00:23:43] Speaker 05:
It's produced in four countries, but not India.

[00:23:45] Speaker 05:
So there is some support that it didn't come from India.

[00:23:48] Speaker 04:
Is there really any question any longer?

[00:23:50] Speaker 04:
I thought the record was clear.

[00:23:51] Speaker 04:
Tell me whether it's disputed, please.

[00:23:54] Speaker 04:
Is there any question any longer that what occurred here was that the company

[00:23:59] Speaker 04:
sent the xanthan gum from China to India, had it repackaged in India, sent it to the US, claimed it was from India, all to avoid the taxation that would otherwise come from China.

[00:24:11] Speaker 04:
Is there a question about what I just said?

[00:24:14] Speaker 04:
I don't believe so.

[00:24:17] Speaker 04:
So they were trying to evade taxation.

[00:24:20] Speaker 05:
Precisely.

[00:24:21] Speaker 05:
This is really a textbook evasion case.

[00:24:24] Speaker 05:
even the plaintiff's appellants have admitted it actually came from China where their entry documents said it came from India.

[00:24:30] Speaker 04:
And like you said, in India everyone agrees there are no manufacturing facilities that can make xanthan gum, so they could not have produced it.

[00:24:37] Speaker 05:
That's correct.

[00:24:38] Speaker 05:
And to your honor's question, Chim Fertz, the alleged manufacturer in India, in fact said in the appendix 526 to 528, we do not manufacture xanthan gum.

[00:24:52] Speaker 05:
The plaintiff's appellants knew that,

[00:24:54] Speaker 05:
The stuff that we repackage comes from China.

[00:24:56] Speaker 05:
So that's independent support upon which customs evasion determination can be done.

[00:25:00] Speaker 04:
Just out of curiosity, I mean, it seems like a lot of effort to ship the xanthan gum to India to have it repackaged to send it to the US.

[00:25:08] Speaker 04:
What kind of money are we talking about?

[00:25:10] Speaker 04:
Like, ballpark.

[00:25:11] Speaker 04:
You know, just generally, what is the difference between the tax rate of xanthan gum in current media versus if it came from China?

[00:25:20] Speaker 05:
It's 154% duty rate as opposed to coming from India where xanthan gum is not produced, zero.

[00:25:27] Speaker 05:
So 154% depends on the volume.

[00:25:29] Speaker 05:
So more than doubles the cost.

[00:25:31] Speaker 04:
154% would more than double the cost of importing xanthan gum here in China as opposed to from India.

[00:25:40] Speaker 04:
And so that's the purpose for the redirection.

[00:25:43] Speaker 05:
Correct.

[00:25:44] Speaker 05:
Presumably, Your Honors, yes.

[00:25:48] Speaker 05:
I'll just last note on the issue of change circumstances referral.

[00:25:53] Speaker 05:
And I just want to make a distinction here.

[00:25:55] Speaker 05:
The change circumstances referral that plaintiff appellant is seeking is to the validity of the order.

[00:26:02] Speaker 05:
The one that customs has an obligation to refer is whether merchandise falls within the scope.

[00:26:10] Speaker 05:
So these are actually completely separate

[00:26:13] Speaker 05:
referrals mechanisms.

[00:26:15] Speaker 05:
The one again that plaintiffs are seeking, there is no authority

[00:26:19] Speaker 05:
in the statute 1517 or the regulations that demands, requires, or even suggests that Commerce has, excuse me, that Customs has an obligation to make this.

[00:26:29] Speaker 02:
Customs doesn't do anything about domestic market.

[00:26:33] Speaker 02:
Correct.

[00:26:33] Speaker 02:
They don't have any expertise.

[00:26:34] Speaker 02:
Would this go to Commerce or would it actually go to ITC?

[00:26:37] Speaker 05:
It could go to either, Your Honor, but there is a statute, 1916-1775, that permits parties like Plaintiff Appellants to make, to provide information to Commerce.

[00:26:49] Speaker 05:
And from there, it could be proceeded by either.

[00:26:53] Speaker 05:
OK.

[00:26:53] Speaker 05:
OK.

[00:26:53] Speaker 05:
Anything further?

[00:26:54] Speaker 05:
No, Your Honor.

[00:26:55] Speaker 05:
We just respectfully request that the court affirm the trial for her.

[00:26:58] Speaker 05:
Thank you.

[00:27:00] Speaker 05:
Thank you, counsel.

[00:27:01] Speaker 05:
Mr. Kirby, you have some more little time if you'd like to use it.

[00:27:07] Speaker 03:
Thank you.

[00:27:08] Speaker 03:
To address, go back to the Royal Brush CAIT

[00:27:18] Speaker 03:
Essentially, they found that there was no live controversy.

[00:27:22] Speaker 03:
Here, we disagree that there is no live controversy.

[00:27:27] Speaker 03:
Simply put, Globe requested in its complaint that the CIT find that CBP's actions.

[00:27:33] Speaker 02:
So let me ask you this.

[00:27:35] Speaker 02:
If you accept that the liquidation is final and there's no authority to refund those duties, then what's the live controversy?

[00:27:42] Speaker 03:
Well, the live controversy is

[00:27:45] Speaker 03:
was their evasion and to what extent.

[00:27:48] Speaker 02:
But it doesn't matter, because even if the court found evasion, they couldn't order your duties refunded, because that's final.

[00:27:55] Speaker 03:
If it was ultimately found that it was at a much lower rate, there's nothing preventing customs to go back and change the billing.

[00:28:02] Speaker 02:
And I don't think they're... I mean, I bet customs would cite you a handful of statutes and regulations that say after a final decision is issued, they have no authority to reliquidate.

[00:28:15] Speaker 03:
But they could change the billing if it was found that there was no evasion or had a much lower rate.

[00:28:22] Speaker 03:
You mean going forward?

[00:28:24] Speaker 03:
Correct.

[00:28:25] Speaker 03:
So there's an outstanding bill.

[00:28:26] Speaker 03:
My client didn't pay.

[00:28:27] Speaker 02:
Well, then, perfect an appeal on that bill.

[00:28:31] Speaker 02:
If that one hasn't been liquidated.

[00:28:33] Speaker 03:
No, no.

[00:28:34] Speaker 03:
These are liquidated entries.

[00:28:35] Speaker 03:
These are the two liquidated entries.

[00:28:37] Speaker 02:
You're not going to get anywhere on those liquidated entries.

[00:28:39] Speaker 03:
And if evasion didn't happen, I think the government would take a second look before it lodged a case against my client and the CIT to collect.

[00:28:49] Speaker 03:
OK.

[00:28:50] Speaker 03:
There's also reputational.

[00:28:52] Speaker 04:
Time has expired.

[00:28:53] Speaker 04:
I thank both counsel.

[00:28:54] Speaker 04:
This case is taken under submission.