PrimeSource Bldg. Prods., Inc. v. United States

662 F.Supp.3d 1379

PRIMESOURCE BUILDING PRODUCTS, INC., Plaintiff, v. UNITED STATES, et al., Defendants.

Slip Op. No. 23-155 Court No. 20-00032

United States Court of International Trade

October 23, 2023

Jeffrey S. Grimson, Mowry & Grimson, PLLC, of Washington, D.C., for plaintiff. With him on the briefs were Kristin H. Mowry, Jill A. Cramer, Sarah M. Wyss, and Bryan P. Cenko.

Stephen C. Tosini, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, D.C., for defendant. With him on the briefs were Brian M. Boynton, Principal Deputy Assistant Attorney General, Patricia M. McCarthy, Director, and Tara K. Hogan, Assistant Director.

OPINION AND ORDER

Stanceu, Judge:

Plaintiff PrimeSource Building Products, Inc. ("PrimeSource") moves for a "partial stay" of enforcement of the judgment this Court entered in response to the decision of the Court of Appeals for the Federal Circuit ("Court of Appeals") in PrimeSource Building Products, Inc. v. United States, 59 F.4th 1255 (Fed. Cir. 2023) ("PrimeSource Building Products"). We deny the motion.

I. BACKGROUND

In PrimeSource Building Products, 59 F.4th at 1263, the Court of Appeals reversed the judgments this Court issued in favor of plaintiff PrimeSource and plaintiffs Oman Fasteners LLC, Huttig Building Products, Inc., and Huttig, Inc. (collectively, "Oman Fasteners"), in their actions to contest a proclamation ("Proclamation 9980") the President of the United States issued under section 232 of the Trade Expansion Act of 1962, as amended, 19 U.S.C. § 1862.¹ See PrimeSource Building Products, Inc. v. United States, 45 CIT —, 505 F. Supp. 3d 1352 (2021). Proclamation 9980 imposed duties of 25% ad valorem on various products ("derivatives") made of steel. Adjusting Imports of Derivative Aluminum Articles and Derivative Steel Articles Into the United States, 85 Fed. Reg. 5,281 (Exec. Office of the President Jan. 29, 2020) ("Proclamation 9980"). The Court of Appeals "remand[ed] the cases for entry of judgment against PrimeSource and Oman Fasteners, including dismissal of the claims against the President." PrimeSource Building Products, 59 F.4th at 1263.

Following issuance of the mandates in the appellate litigation, CAFC Mandate in Appeal No. 21-2066 (July 5, 2023), ECF No. 133; CAFC Mandate in Appeal No. 21-2252 (July 6, 2023), Consol. Ct. No. 20-00037, ECF No. 150, this Court entered judgments in favor of defendants that, inter alia, ordered liquidation of the entries at issue in this litigation in accordance with the decision of the Court of Appeals. Judgment (July 13, 2023), ECF No. 134; Judgment (July 13, 2023), Consol. Ct. No. 20-00037, ECF No. 151.

On July 21, 2023, PrimeSource filed a petition for a writ of certiorari and, on the same day, filed its "partial stay" motion in this Court. Pl. PrimeSource Building Products, Inc.'s Mot. for Partial Stay of the Enforcement of J. Pending Appeal (July 21, 2023), ECF No. 136 ("Pl.'s Mot."). Defendants oppose the motion. Defs.' Opp'n to Pl.'s Mot. to Stay Enforcement of the Federal Circuit's Mandate (Aug. 11, 2023), ECF No. 137. Plaintiff replied to defendants' opposition. Reply to Defs.' Opp'n to Pl. PrimeSource Building Products, Inc.'s Mot. for Partial Stay of the Enforcement of the J. Pending Appeal (Sept. 12, 2023), ECF No. 141.

II. DISCUSSION

Section 2101(f) of Title 28, United States Code, provides as follows:

In any case in which the final judgment or decree of any court is subject to review by the Supreme Court on writ of certiorari, the execution and enforcement of such judgment or decree may be stayed for a reasonable time to enable the party aggrieved to obtain a writ of certiorari from the Supreme Court.

28 U.S.C. § 2101(f). It further provides that "[t]he stay may be granted by a judge of the court rendering the judgment or decree or by a justice of the Supreme Court." Id.

In its motion, PrimeSource seeks a stay of this Court's judgment ordering liquidation of its entries subject to this litigation and "calling for payment of Section 232 duties and interest on PrimeSource's past imports entered, or withdrawn from warehouse for consumption," prior to the date of any stay order this Court issues, "pending resolution of PrimeSource's petition before the Supreme Court." Draft Order (July 21, 2023), ECF No. 136. Should the stay be granted, PrimeSource states that it "shall pay cash deposits of Section 232 duties pursuant to Proclamation 9980 . . . on entries filed by PrimeSource Building Products, Inc. on [and] after 12:01 a.m. of the date of this Court's judgment in slip op 23-101 [July 13, 2023]." Id.

In support of its stay motion, PrimeSource addresses arguments to the four factors by which a court considers a claim for equitable relief, arguing that it will be irreparably harmed by the liquidation of its entries absent the stay it seeks, Pl.'s Mot. 9-15, that its petition for a writ of certiorari is likely to succeed on the merits, id. at 15-26, that the relief it seeks will not substantially injure the government, id. at 27-28, and that granting the stay is favored by the public interest, id. at 29-30.

This is PrimeSource's second motion to obtain a stay following the ruling of the Court of Appeals on the merits of PrimeSource's claims. Following a June 6, 2023 denial by the Court of Appeals of PrimeSource's petition for rehearing in PrimeSource Building Products, PrimeSource moved in the Court of Appeals for a stay of that court's mandate under Federal Rule of Appellate Procedure 41. Mot. of Pl.-Appellee PrimeSource Building Products, Inc. to Stay the Mandate Pending Petition for Writ of Certiorari (June 26, 2023), CAFC No. 21-2066, ECF No. 99 ("Pl.'s Rule 41 Mot."). Under that rule, PrimeSource was required to "show that the petition would present a substantial question and that there is good cause for a stay." Fed. R. App. P. 41(d)(1). In support of its motion to stay the mandate, PrimeSource argued that its petition for a writ of certiorari raises a substantial question, Pl.'s Rule 41 Mot. at 5-16, and, as to "good cause," argued that "PrimeSource will be irreparably harmed as the liquidation of its entries may moot its appeal to the Supreme Court," id. at 17. The Court of Appeals denied that motion in a summary order issued on June 27, 2023. Order (June 27, 2023), CAFC No. 21-2066, ECF No. 100. The summary order does not specify the reasons for denial of the motion to stay the mandate but must be interpreted to mean that at least one of the two requirements of Federal Rule of Appellate Procedure 41, i.e., either the "substantial question" or the "good cause" requirement, which PrimeSource based on its contention of irreparable harm in the absence of a stay of the mandate, was not met.

PrimeSource had not met its burden of demonstrating its entitlement to a different outcome than that reached by the Court of Appeals on its previous motion to stay. If PrimeSource has not presented what is, in the view of the Court of Appeals, a "substantial question" on the merits of its continuing litigation, then we defer to that decision in ruling on the instant stay motion and must conclude on that basis that PrimeSource has not shown a likelihood of success on the merits in its litigation before the Supreme Court. If, on the other hand, the Court of Appeals denied the previous stay motion on the ground that PrimeSource has not made an adequate showing of irreparable harm, then we defer to that decision. In short, we decline to revisit either of the two possible grounds upon which the Court of Appeals denied the previous stay motion. Because a showing of irreparable harm and a showing of likelihood of success on the merits are essential to a grant of equitable relief, PrimeSource has not met its burden for obtaining the stay it now seeks.

With particular respect to its irreparable harm argument, PrimeSource maintains, first, that "liquidation of its entries may moot any appeal before the Supreme Court," Pl.'s Mot. 9, on the premise that a court's ability to order relief in the face of liquidated entries is uncertain in light of certain precedents of the Court of Appeals following that court's decision in Shinyei Corp. of America v. United States, 355 F.3d 1297 (Fed. Cir. 2004), including American Signature, Inc. v. United States, 598 F.3d 816 (Fed. Cir. 2010). Second, PrimeSource asserts that it "will suffer from significant 'business disruptions' associated with paying the applicable cash deposits of Section 232 duties with interest on its past imports." Pl.'s Mot. 13. It argues that "PrimeSource will need to expend significant resources on the mechanics of paying the applicable cash deposits of Section 232 duties with interest on its many thousands of past imports." Id. at 14. Neither argument is persuasive.

Despite what PrimeSource characterizes as uncertainty as to a possible post-liquidation remedy, PrimeSource has not made a convincing showing that the Supreme Court, should it grant PrimeSource's petition for a writ of certiorari and invalidate Proclamation 9980, would consider itself precluded from ordering any relief it deemed necessary, regardless of asserted unsettled issues arising from lower court decisions. PrimeSource's argument that it may incur "business disruptions" is also unavailing. In ordering the liquidation of entries, this Court's entry of judgment effectuated the mandate of the Court of Appeals, which upheld the validity of Proclamation 9980 and, therefore, of the liability of PrimeSource, like that of any similarly situated importer, for duties of 25% ad valorem on entries arising from its past business activities.

III. CONCLUSION AND ORDER

Upon consideration of Plaintiff PrimeSource Building Products, Inc.'s Motion for Partial Stay of the Enforcement of Judgment Pending Appeal (July 21, 2023), ECF No. 136, defendants' opposition, and plaintiff's reply, and upon due deliberation, it is

ORDERED that the motion be, and hereby is, denied.

/s/ Jennifer...