Background
The dispute arose from the U.S. Department of Commerce’s expedited review of the countervailing-duty order on certain softwood lumber products from Canada. Following several remands, Commerce calculated a subsidy rate for Les Produits Forestiers D&G Ltée and its cross-owned affiliates, including Les Produits Forestiers Portbec Ltée, by accounting for subsidies received by unaffiliated Canadian suppliers whose lumber D&G/Portbec exported to the United States.
In an earlier decision, the court held that Commerce abused its discretion by refusing to reopen the record for evidence concerning Portbec’s purchases of lumber on a duty-paid basis in the United States. On the fourth remand, Commerce accepted additional questionnaire responses, deducted C$5,317,890 from the relevant sales category, and reduced D&G/Portbec’s overall subsidy rate from 1.75% to 1.05%. The revised rate nevertheless remained above the de minimis threshold, leaving the companies subject to the countervailing-duty order.
The Court’s Holding
The court sustained Commerce’s fourth remand results. It found that Commerce’s deduction for Portbec’s U.S. purchases was supported by substantial evidence and otherwise in accordance with law. No party challenged that aspect of the revised calculation.
The court rejected D&G/Portbec’s request for a fifth remand to address whether Commerce needed an upstream-subsidy allegation before including subsidies associated with remanufactured lumber. Applying administrative-exhaustion and forfeiture principles, the court held that the companies had not timely and adequately developed their statutory argument during the third or fourth remand proceedings, when their rates were above de minimis. Their scattered references and footnotes were insufficient to preserve the issue, and Loper Bright did not excuse the failure to exhaust it.
Key Takeaways
- Commerce reasonably deducted C$5,317,890 attributable to qualifying duty-paid lumber purchases and recalculated D&G/Portbec’s subsidy rate at 1.05%.
- A party must present its arguments fully and at the proper administrative stage; passing references and footnotes do not preserve an issue for judicial review.
- Loper Bright’s requirement of independent judicial interpretation does not automatically excuse failure to exhaust statutory-interpretation arguments before an agency.
Why It Matters
The decision underscores the importance of preserving objections during trade-remedy remand proceedings, especially once a revised calculation materially affects a respondent’s liability. Even a potentially significant statutory argument may be lost if it is not squarely presented to Commerce and adequately developed before the court.
The ruling also finalizes Commerce’s successive remand determinations for D&G/Portbec. Although the companies obtained a lower subsidy rate after supplementing the record, the above-de-minimis rate means they remain covered by the Canadian softwood-lumber countervailing-duty order.