On February 7, 2023, the U.S. Court of International Trade (CIT) heard oral argument in In Re Section 301 Cases, Court No. 21-00052, the lead case for the claims filed by thousands of importers challenging the imposition of Section 301 List 3 and List 4A additional tariffs against certain products from China.  Previously, the CIT had found that the United States Trade Representative (USTR) had failed to establish that it had followed the procedural requirements of the Administrative Procedure Act (APA) when it promulgated List 3 and List 4A.  The CIT had issued a remand to USTR to give the agency an opportunity to demonstrate that its actions complied with APA requirements.

The sole issue addressed in the oral argument was whether the 90-page remand report filed by USTR was sufficient to establish that the agency’s actions satisfied the APA.  Specifically, the parties addressed whether USTR has shown that, prior to acting, it considered comments and testimony from the trade regarding the overall wisdom of the additional tariffs.  Those comments addressed whether the aggregate trade levels that were targeted ($200B for List 3 and $300B for List 4) were too high and whether there were better alternatives to the additional tariffs, such as multilateral trade sanctions.

During the oral argument, the judges did seem concerned that there were no documents cited in the remand report directly showing that USTR had considered these issues.  However, the judges gave little indication as to how they plan to rule.  The options for the CIT are: 1) to order a second remand to USTR to provide further evidence; 2) to find that USTR has met the APA requirements; or 3) to find that USTR failed to meet its requirements and, as a result, the tariffs were unlawfully assessed and must be refunded.

A final decision from the CIT is likely to be issued in the spring.  If the CIT were to order the parties to submit additional briefs, its decision could be delayed.  In any event, an appeal to the U.S. Court of Appeals for the Federal Circuit is certain following the CIT’s final decision.  If you have any questions regarding this case, please contact one of our attorneys.