cases global commodity group for the United States and Achor Daniels Midland at L, 2012, 1346 Mr. Thompson. Good morning. The issue in this appeal is how to interpret the scope language of the anti-dumping and counter-vailability orders on citric acid and certain citric salts from China. As a starting point don't we have to give an awful lot of deference to how the government interprets it? Well, you're on a, we don't believe that the deference is due to a misinterpretation of the plain language of the orders scope. We don't have cases that say we give substantial deference to commerce's interpretation of its own orders. Oh, you would give deference to its interpretation however one is plainly wrong as his court has found in a number of cases. No deference is going to be due. And we think that on a plain language of the orders in this case there's only one interpretation that's possible. Deference would be permissible if there were a question about what the order meant. We believe that the order has one explicit meaning only and that is that blends that have a non-subject citric acid in them of the requisite percentage are excluded on the face of the order. Why is that so clear? Well because citric acid is citric acid. Citric acid from China however is the product that's subject to the orders. And the first sentence of the orders defines the merchandise that's covered and of course that merchandise is citric acid from China. The lesson of description of all citric acid from anywhere in the world. That description is of citric acid from China. So there you go
. There are also includes, blends of citric acid as well as blends with other ingredients such as sugar. Where the unblended form constitutes 40% or more which certainly applies here because between the citric acid from China and the other citric acid is more than 40%. But our position is that based on the structure of the scope line which citric acid from somewhere other than China constitutes and other ingredients. It's not like sugar. Well, the reference to such as sugar is exemplary but it is not validity. There was no limitation. Don't we remember the Latin expression that you know a word by its friends? Well, if you want to use a used in generous from now it's another. Not a Latin expression but you know it. Yes. The Nasitori Celsius is okay. Right. But this would not apply because there is no limitation put on the other ingredients. Such as sugar gives you one example of a product that constitutes and other ingredient. By no means eliminates anything else. What does eliminate? What does open rather? The definition is that it says other when it says blends with other ingredients. You have to refer back to the predecessor provisions of the orders to determine what those other ingredients are
. And those other ingredients have to be anything that's not covered in the first sentence. So that is our position that other ingredients excludes Chinese citric acid and other citric salts. But it includes anything else including the unsuptured citric. So when the first sentence refers to unblended forms you're saying that means unblended with something from the country of origin? That means yes. If it's citric acid, pure citric acid from China that's what's covered. And then of the same total sodium citrate and potassium citrate. Those coming in as separate items they're covered. Then the second sentence. Coming in as separate items from China. The suburitons. Unblended with each other. And then the second one is the scope also includes blends of citric acid, sodium citrate and potassium citrate. So if you took those Chinese products and blended any of them together, what this language says is that's going to be covered as well. Now we're talking about that first sentence and the first part of the second sentence. That's purely Chinese product. All right
. It's not talking about blends of Chinese product. When you say it's a plain language interpretation, where in that first sentence does it say only purely Chinese product? Because it's an anti-dumping duty order on citric acid from China. So that it doesn't include the statement from China. That is implicit throughout. You couldn't, there's no way that you can interpret that first sentence as covering citric acid from anywhere else. Because the order only applies to China. What Congress has done is overlooked that orders have not only physical descriptions, but also limited geographically to a particular country. So their reading is inconsistent with the limitations, these dual limitations that put an impact on anti-dumping and counter-dialogue duty orders. So we believe that straightforward reading of the orders needs to result that citric acid from some third country constitutes an other ingredient. And that one you have a blend of 65% non-sub-excitric acid, that is excluded under the second clause of the second sentence. It's hard for me to reach that conclusion when it says all grades and gradual sizes of citric acid in the first sentence. And the second sentence says blends with other ingredients. It's hard for me to reach the conclusion that an other ingredient is citric acid. Well it's citric acid from another country because other ingredients refers back to the first sentence. And what does cover the first sentence? And the first sentence doesn't say Chinese citric acid is said. But it's part of the anti-dumping order that covers only China
. Right, which is why they're only going after whatever it is 35% of what you're bringing in. They're not trying to assess the duty on 100% of what you're bringing in. But our position is yet that that's what makes sure I get the facts right. But our position is that the entire length is excluded under the second clause of the second sentence. There's other ingredients. I think you are too narrowly construing what that means. It's other than what precedes it and what precedes it can only be considered Chinese citric acid. Doesn't say that in that prior sentence. It says all grades and gradual sizes of citric acid. If you look at the scope, it covers citric acid from China. So how could a description of a product include something other than citric acid from China? See, that has to permeate the entire understanding of the scope language. We're not talking about citric acid in the abstract otherwise. And you would absolutely be right if they were trying to assess duty against 100% of your product. It seems to me because if they were assessing duty against 100% of your product, they would be treating it as though it was all citric acid from China. But the error that they're making is treating us not as he glint under the second clause of the second sentence. But as
... You do realize that you're not a blended sort of the traditional sense of the word. There's citric acid and there's more citric acid that's not blended with anything. It's all citric acid. Oh, but it's Chinese citric acid blended with non-chinese. Is there some technological difference between the two? No. No difference other than country of origin. There's no difference chemically. It's just a country of origin. No. So, even inside, I'm not sure what the country of origin would be or perhaps under customs principles, the Chinese and non-chinese portions would be allocated to different countries. But in this case, the plain definition of blend means mixing something with something else. And the something that's being blended is the Chinese citric acid, something else. Of course, by your definition, if you take 10% Chinese citric acid and add 25% Chinese citric acid, that's a blend. No, you're blending them
. Not under the terms of the order, all right? Because when it's talked about, when it says citric acid in its comp blended forms, the blend that is being referred to is going to be the blend of Chinese citric acid. See, the order doesn't cover individual companies per se. It covers citric acid from China. So, the blend is something being blended in with citric acid from China, no matter what lot it came from or no matter what company it came from. So, we believe that there's no other interpretation of other ingredients that commerce's statement that were commingled rather than blended is simply wrong as a matter of vocabulary. Commingling is a synonym of blend. And so, what commerce is statically getting there is that we are blend. But I see no basis for saying that you have to be something other than citric acid in general, constituted blend. The way it set up is a blend to be something other than Chinese citric acid. And then you have to be something that is not being mixed with the order itself that we're talking about. I don't know. Don't call that major one. Well, you went through the rebuttal time. It's sort of a single issue which we understand. Yes, you want to say the rest of the time. I guess it is
. Okay. Ms. McCafflin. And you're going to take ten minutes and then you'll blend your argument with Mr. Schneider. Oh, blend is trans. Or maybe commingle it. May I please the court? As this court knows, the court of national trade, we're going to have holds, commerce, as determinations as reasonable. But this is one of the rare cases in which they use the adverb eminently reasonable because there's really no question. There's no dispute that the subject product here is pure citric acid. What kind is the order on? Your Honor, I apologize. The order is the slip language decided at 74, Fed, right? At 27703. It's not including the appendix. How could you guys have a whole case about what the order says and not giving me the order? I don't disagree and apologize on behalf of the department for including that. But their federal register notices there. And that should be included
. There's no question about it. But there's no dispute that this is a juror citric acid that falls squarely within the first sentence of the scope of language in the federal register notice. I apologize again. And the global commodities group repeatedly refers to the blended language as an exclusion and as Judge Carbin noted before, commerce's explanation for this was compelling because it's not an exclusion. It was intended to expand the scope of the order to include not just pure citric acid and pure citric, but to allow them to be blended with each other and to be blended with other ingredients. So the whole purpose of this, because the domestic industry demonstrated that the dumping of these products was causing injury to the domestic industry, the purpose of it was to have a scope of the order of cover so there could be a proper remedy for this. And all scope orders limited geographically, isn't that an inherent aspect of the scope order? The scope order, I'm sorry, limited to what you are saying. Isn't it a geographic limitation that we're talking about? Yes, of course, Your Honor. But as on page 39 of the joint appendix and the preliminary scope rule in commerce identified two instances, at least two instances in which subject merchandise has been co-mingled with non-subject merchandise from other countries. And it proposed a methodology, the two cases one from 1952, which is US industrial chemical, and the second one from 1986, which is coastal states' marketing, and proposed a methodology to ensure that there's not an over-assessment of duties that only the citric acid that's from China is assessed duties. And there's a methodology that commerce proposed that wasn't any objection. Why is 40% citric acid from China okay as long as it's mixed with sugar, but it's not okay if it's mixed with citric acid from non-subject countries? I think it depends on the nature of the product. The fact of matters of commercial products such as citric acid was being dumped on the market in the United States. Theoretically, if you have a 90% sugar in this, this is right below. This was all just based on the face of the order you're saying that just from a pure language standpoint, that's the end of inquiry. All this analysis about what the order was intended to get to, none of that is in the record, is it? Well, the record, of course, the investigation and the record of what led commerce to do this
. Even onto the plain language, other, let me back up a little bit. There's never been, and Global Commodities Group can't cite any case in which there's been a conflation between the country of origin and the physical description of the product. The physical description of the product relates to the physical characteristics of the product, whether it be sugar, whether it be churse of deg acid, whether it be citric salts. It's the physical description describes the product. The country of origin is a limitation, but it's exogenous to the physical description. And the idea that, and even Global Commodities Group has to admit that it, and page 10 of its blue brief, refers to an inherent geographical restriction, or geographic restriction, which is an odd, which is an odd pure plain language argument to be making, to be drawing inferences into your plain language argument, because there isn't any expressed geographic limitation. So this was a product that was defined, originally as pure, and commerce has a clarification, and the domestic industry added this other language to include lens, to make sure that the injury would be fully emanated. Again, there's no overreaching, because there's only an assessment and duties of that portion of the commingled citric acid that's from China. And another point for us, just to get a context of what's really going on here, is this product did not exist before the order. The order is being, this product is being sort of coincidentally held to being less than 40% Chinese. It's tailored to the order to avoid the order. There is product that being tailored to the order, on page 17, I'm sorry, page 13. But going to the language of the order itself, you agree when it says the scope of these orders includes all grades, granulation sizes of citric acid. It really isn't all sizes of citric acid. It's all sizes of citric acid from China. The scope of this order doesn't include citric acid from another country, correct? Correct
. But let's pay a high-pithetically, the commissive never asked for clarification of the domestic industry, and this London language was never added. I imagine that it would be undisputed that even a portion of citric acid, your citric acid that is commingled with citric acid from other countries, would still be subject to the order. Subject to this methodology, which was used in 1952 and 1952 used in 1986, where there's just a proper assessment. Does it fall squarely within the London language? Well, I don't think he would agree, because he would say, as he does now, that he's a blend, and the first sentence as the scope of these orders includes all grades and granulations of citric acid in their unblended forms. But citric acid is, I'm sorry, but that sentence was there before they added the blended sentence. So I think he would say that this scope, that his product, once it's blended, isn't pure citric acid, and the first sentence only covered pure citric acid from China. But blended refers to the physical characteristics, and mingling citric acid with other citric acid does not change the physical cracked characteristics. There's been no such substantial transformation in this process. Well, but the thing here that says this is limited to the physical characteristics, in fact, the sentence begins the scope of these orders. Well, you acknowledge that the scope of these orders is not just to citric acid, it's to Chinese citric acid, that the physical citric acid, that is identical to Chinese citric acid, but originates from another country, would not be covered. I respectfully disagree with you, Your Honor. Would you cover the citric acid that comes from Haiti, it's covered? No, but if there's a portion of the, of the portion of the citric acid that comes from China, it is covered. And then the proper approach would be to have a methodology that captures just that portion. But you want me to read this scope sentence as limited to citric acid from China, is that right? Yes. Even though it has 65% citric acid from, say, Korea. Yes. So long as it's coming from China. Because it's coming from China. So long as the, the, the, the, the portion of the citric acid from China is, is, is properly assessed the duties and ask the methodology. And that's what happened. The, you know, as I get, again, the, the Department of Commerce has faced incidents of the past as it, as explained on, and it's, um, preliminary scope ruling, which, and there was no objection to this methodology of, of, of using assessments, assessing duties just to deal with the, the portion of the co-mingled merchandise that's under, under the order. But the point I want to make is that this was, there was never a market for this product beforehand. And this is, this is essentially a giant batch. It, it, it, it, a page 17, of, well, well, try, well, making a product that is designed to comply with a governmental order isn't a bad thing. And in other words, we want them to try to comply with governmental orders, right? But this was never the intent. This, with, this is, this is creating a new product that has the consists of, of citric acid, pure citric acid. And, and it's just, it's, it's, it includes the, you would say this is designed to, you would say this is designed to avoid the governor. Well, I don't, I want to be careful because there hasn't been a circumvention inquiry and I don't want to overstate it. But clearly, when, when, when a page 17 of the, of the reply break, global conities were used as a term loophole. That's their word, not our word. They're, they're, they're looking for this as a, as a loophole. I don't really contour it to the intensive commerce
. So long as it's coming from China. Because it's coming from China. So long as the, the, the, the, the portion of the citric acid from China is, is, is properly assessed the duties and ask the methodology. And that's what happened. The, you know, as I get, again, the, the Department of Commerce has faced incidents of the past as it, as explained on, and it's, um, preliminary scope ruling, which, and there was no objection to this methodology of, of, of using assessments, assessing duties just to deal with the, the portion of the co-mingled merchandise that's under, under the order. But the point I want to make is that this was, there was never a market for this product beforehand. And this is, this is essentially a giant batch. It, it, it, it, a page 17, of, well, well, try, well, making a product that is designed to comply with a governmental order isn't a bad thing. And in other words, we want them to try to comply with governmental orders, right? But this was never the intent. This, with, this is, this is creating a new product that has the consists of, of citric acid, pure citric acid. And, and it's just, it's, it's, it includes the, you would say this is designed to, you would say this is designed to avoid the governor. Well, I don't, I want to be careful because there hasn't been a circumvention inquiry and I don't want to overstate it. But clearly, when, when, when a page 17 of the, of the reply break, global conities were used as a term loophole. That's their word, not our word. They're, they're, they're looking for this as a, as a loophole. I don't really contour it to the intensive commerce. And, and there is a, what? The commerce has already said that if you bring in less than, if one that has less than 40% citric acid from China, then it's okay. And so they're bringing in less than 40% citric acid from China. So why isn't that a problem? You're wondering, is that would be referring to a different product, not pure citric acid. The blend would be, for instance, if you have 98% sugar and you're adding a little bit of citric acid. No, you can ask it a little bit. You can add up to 40%. But that's a different product than a different harmonized tariff classification. It's, it, there hasn't been any demonstration that that type of product would cause injury to the Mexican industry. There has been a, there has been a demonstration here that citric acid, pure citric acid from China has caused a substantial injury to the domestic industry. And this product has not been substantial transformed. There's no objection to commerce, there's substantial transformation analysis. And if there are any further questions, respectfully request that. Thank you, Ms. McCawthing. Mr. Schneideman is representing ADM
. And, and there is a, what? The commerce has already said that if you bring in less than, if one that has less than 40% citric acid from China, then it's okay. And so they're bringing in less than 40% citric acid from China. So why isn't that a problem? You're wondering, is that would be referring to a different product, not pure citric acid. The blend would be, for instance, if you have 98% sugar and you're adding a little bit of citric acid. No, you can ask it a little bit. You can add up to 40%. But that's a different product than a different harmonized tariff classification. It's, it, there hasn't been any demonstration that that type of product would cause injury to the Mexican industry. There has been a, there has been a demonstration here that citric acid, pure citric acid from China has caused a substantial injury to the domestic industry. And this product has not been substantial transformed. There's no objection to commerce, there's substantial transformation analysis. And if there are any further questions, respectfully request that. Thank you, Ms. McCawthing. Mr. Schneideman is representing ADM. Is it ADM? Yes, thank you, Your Honor, please the court. I think what we have here is that Mr. Thompson just fundamentally misunderstands how the physical description of the class or kind must be read in conjunction with the country of origin or not. As we've said in our brief, first you look exclusively at the physical description of the class or kind without any regard to the country of origin. So you don't insert the works from China in that first sentence. And at the completion of that analysis, then you ask, well, is the country of origin for this product from China? The reason we have. So your argument really is that blend that a blend has to include something other than pure citric acid. Other than pure citric acid. And more importantly, you look at the first term, the first term, is it blend? If it is, then you ask, is the country of origin in China? And that question is not answered by saying, well, does it include citric acid from China? The example that Mr. Thompson gave is, if you have French citric acid, which you then mix with Mexican sugar in China, he's saying if you read the scope of the way Congress would like, that would nullify the country of origin in parliament, bring this within the school. The problem with that is that when you look at a true blend, such as citric acid and sugar, the question is, where does substantial transformation occur? If substantial transformation occurs in China, it's either bringing in French citric acid, transform it into China, that is a blend that is covered by the scope of the order because the country of origin becomes China. Essentially, the French nature of the gastric becomes an article of China, that is covered by the scope of origin. It's not before you, but it shows that you don't, in other words, it shows that you have to look at the physical description independently from country of origin. Why aren't the other ingredients anything that isn't the ingredients about which the duty is being assessed, so why isn't citric acid from another country and other ingredient? Because, as I said, first you look at the physical description, the first sentence covers pure citric acid, that's what we have here, pure citric acid. His argument is that if you don't, if you interpret other ingredients to, if you don't interpret the word other ingredients to include citric acid from other countries, you nullify the country of origin in parliament. Well, you don't
. Is it ADM? Yes, thank you, Your Honor, please the court. I think what we have here is that Mr. Thompson just fundamentally misunderstands how the physical description of the class or kind must be read in conjunction with the country of origin or not. As we've said in our brief, first you look exclusively at the physical description of the class or kind without any regard to the country of origin. So you don't insert the works from China in that first sentence. And at the completion of that analysis, then you ask, well, is the country of origin for this product from China? The reason we have. So your argument really is that blend that a blend has to include something other than pure citric acid. Other than pure citric acid. And more importantly, you look at the first term, the first term, is it blend? If it is, then you ask, is the country of origin in China? And that question is not answered by saying, well, does it include citric acid from China? The example that Mr. Thompson gave is, if you have French citric acid, which you then mix with Mexican sugar in China, he's saying if you read the scope of the way Congress would like, that would nullify the country of origin in parliament, bring this within the school. The problem with that is that when you look at a true blend, such as citric acid and sugar, the question is, where does substantial transformation occur? If substantial transformation occurs in China, it's either bringing in French citric acid, transform it into China, that is a blend that is covered by the scope of the order because the country of origin becomes China. Essentially, the French nature of the gastric becomes an article of China, that is covered by the scope of origin. It's not before you, but it shows that you don't, in other words, it shows that you have to look at the physical description independently from country of origin. Why aren't the other ingredients anything that isn't the ingredients about which the duty is being assessed, so why isn't citric acid from another country and other ingredient? Because, as I said, first you look at the physical description, the first sentence covers pure citric acid, that's what we have here, pure citric acid. His argument is that if you don't, if you interpret other ingredients to, if you don't interpret the word other ingredients to include citric acid from other countries, you nullify the country of origin in parliament. Well, you don't. If you have a blend, the question is, is that blend from China? It doesn't nullify the country of origin in parliament. If the blending in China is substantial transformation, then it doesn't matter whether the citric acid was produced in China. So the scope is not necessarily restricted to blends. There's no basis to say that the scope only includes blends where the citric acid production and blending was performed in China regardless of what you're saying. I'm confused. Maybe you misbogra me again, I misunderstood you. Are you saying that if they took citric acid, not from China, not Chinese citric acid and blended it with other stuff somehow, it could fall within this duty? It depends if it's a substantial transformation occurs, confirming Chinese origin. I was pretty sure that this duty as I understood the government arguing it applies to citric acid from China. That's correct. At war blends of citric acid. Right. Where the citric acid component has to come from China. Not necessarily, your honor, respectfully. If it also, it does include pure citric acid originator from China. But if it's a blend, you then have to end again. You look at blend without regard to country of origin of where the components are originating from
. If you have a blend, the question is, is that blend from China? It doesn't nullify the country of origin in parliament. If the blending in China is substantial transformation, then it doesn't matter whether the citric acid was produced in China. So the scope is not necessarily restricted to blends. There's no basis to say that the scope only includes blends where the citric acid production and blending was performed in China regardless of what you're saying. I'm confused. Maybe you misbogra me again, I misunderstood you. Are you saying that if they took citric acid, not from China, not Chinese citric acid and blended it with other stuff somehow, it could fall within this duty? It depends if it's a substantial transformation occurs, confirming Chinese origin. I was pretty sure that this duty as I understood the government arguing it applies to citric acid from China. That's correct. At war blends of citric acid. Right. Where the citric acid component has to come from China. Not necessarily, your honor, respectfully. If it also, it does include pure citric acid originator from China. But if it's a blend, you then have to end again. You look at blend without regard to country of origin of where the components are originating from. You have to decide is that blend from China? And to do that, you have to look at where the citric acid transformation occurs. If they're importing, I'm not taking a position on whether mixing citric acid with sugar is a significant information. If it's not, then obviously China is not the country of origin. It wouldn't be covered by this code. But if it is, then it doesn't matter what it's. The summary of commerce is that our register says commerce department is issuing anti-cubic duty orders on citric acid and certain citric acid salts from Canada and China. So I don't see how a blend if the citric acid itself doesn't come from China is included in the studio order. Well, again, that's not the issue presented here. The reason I bring it up is because Mr. Thompson presented as an example to say that that would be the logical conclusion if you adopted commerce's interpretation. I don't think there's any problem with that logical conclusion. I think that blends if they're originating from China for the blend is within the physical scope. And at originates from China, I don't see a problem with that fall on within the scope of the order. There's nothing that says that the in the case of a blend that the citric component has to originate from China. But again, we're not even in a hypothetical situation. This is a pure citric product
. You have to decide is that blend from China? And to do that, you have to look at where the citric acid transformation occurs. If they're importing, I'm not taking a position on whether mixing citric acid with sugar is a significant information. If it's not, then obviously China is not the country of origin. It wouldn't be covered by this code. But if it is, then it doesn't matter what it's. The summary of commerce is that our register says commerce department is issuing anti-cubic duty orders on citric acid and certain citric acid salts from Canada and China. So I don't see how a blend if the citric acid itself doesn't come from China is included in the studio order. Well, again, that's not the issue presented here. The reason I bring it up is because Mr. Thompson presented as an example to say that that would be the logical conclusion if you adopted commerce's interpretation. I don't think there's any problem with that logical conclusion. I think that blends if they're originating from China for the blend is within the physical scope. And at originates from China, I don't see a problem with that fall on within the scope of the order. There's nothing that says that the in the case of a blend that the citric component has to originate from China. But again, we're not even in a hypothetical situation. This is a pure citric product. And there's no, it's not as uncontested that the country of origin for that citric product is China. Is it your final thought? I would concur with Ms. McCarthy's description of this as an attempt to evade or shorten that the order. I frankly, I think the whole argument that they've come up with is a post-hoc explanation. I think that they were in their original questions. That's sort of coloration. Nothing for that. Thank you very much, Mr. Shredman. Mr. Thompson has for half minutes to report if he needs it. I'll speak to you, Mr. Hunter. That would not speak so fast. First thought, I'd like to address the supposed two-step process under which the first question is, is this citric acid from anywhere and then is it from China? Nothing were to be unitary. It only covered citric acid from China
. And there's no, it's not as uncontested that the country of origin for that citric product is China. Is it your final thought? I would concur with Ms. McCarthy's description of this as an attempt to evade or shorten that the order. I frankly, I think the whole argument that they've come up with is a post-hoc explanation. I think that they were in their original questions. That's sort of coloration. Nothing for that. Thank you very much, Mr. Shredman. Mr. Thompson has for half minutes to report if he needs it. I'll speak to you, Mr. Hunter. That would not speak so fast. First thought, I'd like to address the supposed two-step process under which the first question is, is this citric acid from anywhere and then is it from China? Nothing were to be unitary. It only covered citric acid from China. So this attempt to say, well, somehow the first sentence could be construed to cover all citric acid from anywhere. And then we then can start to hear only assessed on the amount from China. Well, see, that would be if we didn't have that second clause, that would be a proper outcome. But it's the second clause, and we heard the government say, well, that includes certain products. But by necessary implication, it also excludes products that have below the threshold of 40% Chinese citric acid. Your concept is whatever you mix it with, as long as you keep it under 40% you're fine. Exactly. And Judge Moore, you put the case much better than I have in the past couple of years. But that is precisely what we are arguing. Anything other than Chinese citric acid, which is the product, that is to find the first sentence is in other ingredient. So then why didn't they just say in the first sentence that it applies to un-lended citric acid, as long as it's not less than 40%. I'm not sure why they posed the exclusion and the inclusion this way. It was, I speculate, but... Don't worry with the government that they're really different products and cause different damage to the domestic injury industry
. So this attempt to say, well, somehow the first sentence could be construed to cover all citric acid from anywhere. And then we then can start to hear only assessed on the amount from China. Well, see, that would be if we didn't have that second clause, that would be a proper outcome. But it's the second clause, and we heard the government say, well, that includes certain products. But by necessary implication, it also excludes products that have below the threshold of 40% Chinese citric acid. Your concept is whatever you mix it with, as long as you keep it under 40% you're fine. Exactly. And Judge Moore, you put the case much better than I have in the past couple of years. But that is precisely what we are arguing. Anything other than Chinese citric acid, which is the product, that is to find the first sentence is in other ingredient. So then why didn't they just say in the first sentence that it applies to un-lended citric acid, as long as it's not less than 40%. I'm not sure why they posed the exclusion and the inclusion this way. It was, I speculate, but... Don't worry with the government that they're really different products and cause different damage to the domestic injury industry. Don't agree at all. The exclusion was crafted by the petitioners to identify products after whatever reason they didn't see as injurious or at least subject to the case. So the question is, what is the interpretation of the language that petitioners crafted? Again, there was a brief discussion of sort of the history of this provision. You go to page 11 of our brief, page 16 of the governance brief, this is our brief. We have a quote from the correspondence that petitioners had with COSCO, with COSCO. And they said that their concern was they defined subject merchandise as citric products. And then they said, so this goes to the exclusion and it says as well as one's, the other agrees in which one more of citric products represent the predominant inclusion. Well, citric products there that they refer to is the subject merchandise, citric from China. They have defined and quirk and commerce both got this wrong, but they weren't looking to expand into all citric products. They defined it in their correspondence. The citric that they were referring to was the subject merchandise from China. So this idea that they were trying to come up with a very expansive provision is simply bellowed not only by the scope language in our view, but also to the extent that it's probably to consult the sort of history, how this provision was adopted. It's bellowed by their own characterization to the agency. The government identified a couple of cases in which chemical products had the dumps and non-dumped parts separated out. That's very interesting. What is beside the point here, those orders did not have the blend exclusion language that we have here
. Don't agree at all. The exclusion was crafted by the petitioners to identify products after whatever reason they didn't see as injurious or at least subject to the case. So the question is, what is the interpretation of the language that petitioners crafted? Again, there was a brief discussion of sort of the history of this provision. You go to page 11 of our brief, page 16 of the governance brief, this is our brief. We have a quote from the correspondence that petitioners had with COSCO, with COSCO. And they said that their concern was they defined subject merchandise as citric products. And then they said, so this goes to the exclusion and it says as well as one's, the other agrees in which one more of citric products represent the predominant inclusion. Well, citric products there that they refer to is the subject merchandise, citric from China. They have defined and quirk and commerce both got this wrong, but they weren't looking to expand into all citric products. They defined it in their correspondence. The citric that they were referring to was the subject merchandise from China. So this idea that they were trying to come up with a very expansive provision is simply bellowed not only by the scope language in our view, but also to the extent that it's probably to consult the sort of history, how this provision was adopted. It's bellowed by their own characterization to the agency. The government identified a couple of cases in which chemical products had the dumps and non-dumped parts separated out. That's very interesting. What is beside the point here, those orders did not have the blend exclusion language that we have here. And that's what makes all the difference. I would agree. That blend language didn't apply, then we would have a very different case. But unlike every other dumping word that I'm aware of, there is an exclusion for certain blended products. So what's being presented to the court is whether or not citric from China blended with citric from another country constitutes an excluded blend. So if there are no further questions, you're on our own. Thank you, Mr. Thompson. It's a case on the advisory.
cases global commodity group for the United States and Achor Daniels Midland at L, 2012, 1346 Mr. Thompson. Good morning. The issue in this appeal is how to interpret the scope language of the anti-dumping and counter-vailability orders on citric acid and certain citric salts from China. As a starting point don't we have to give an awful lot of deference to how the government interprets it? Well, you're on a, we don't believe that the deference is due to a misinterpretation of the plain language of the orders scope. We don't have cases that say we give substantial deference to commerce's interpretation of its own orders. Oh, you would give deference to its interpretation however one is plainly wrong as his court has found in a number of cases. No deference is going to be due. And we think that on a plain language of the orders in this case there's only one interpretation that's possible. Deference would be permissible if there were a question about what the order meant. We believe that the order has one explicit meaning only and that is that blends that have a non-subject citric acid in them of the requisite percentage are excluded on the face of the order. Why is that so clear? Well because citric acid is citric acid. Citric acid from China however is the product that's subject to the orders. And the first sentence of the orders defines the merchandise that's covered and of course that merchandise is citric acid from China. The lesson of description of all citric acid from anywhere in the world. That description is of citric acid from China. So there you go. There are also includes, blends of citric acid as well as blends with other ingredients such as sugar. Where the unblended form constitutes 40% or more which certainly applies here because between the citric acid from China and the other citric acid is more than 40%. But our position is that based on the structure of the scope line which citric acid from somewhere other than China constitutes and other ingredients. It's not like sugar. Well, the reference to such as sugar is exemplary but it is not validity. There was no limitation. Don't we remember the Latin expression that you know a word by its friends? Well, if you want to use a used in generous from now it's another. Not a Latin expression but you know it. Yes. The Nasitori Celsius is okay. Right. But this would not apply because there is no limitation put on the other ingredients. Such as sugar gives you one example of a product that constitutes and other ingredient. By no means eliminates anything else. What does eliminate? What does open rather? The definition is that it says other when it says blends with other ingredients. You have to refer back to the predecessor provisions of the orders to determine what those other ingredients are. And those other ingredients have to be anything that's not covered in the first sentence. So that is our position that other ingredients excludes Chinese citric acid and other citric salts. But it includes anything else including the unsuptured citric. So when the first sentence refers to unblended forms you're saying that means unblended with something from the country of origin? That means yes. If it's citric acid, pure citric acid from China that's what's covered. And then of the same total sodium citrate and potassium citrate. Those coming in as separate items they're covered. Then the second sentence. Coming in as separate items from China. The suburitons. Unblended with each other. And then the second one is the scope also includes blends of citric acid, sodium citrate and potassium citrate. So if you took those Chinese products and blended any of them together, what this language says is that's going to be covered as well. Now we're talking about that first sentence and the first part of the second sentence. That's purely Chinese product. All right. It's not talking about blends of Chinese product. When you say it's a plain language interpretation, where in that first sentence does it say only purely Chinese product? Because it's an anti-dumping duty order on citric acid from China. So that it doesn't include the statement from China. That is implicit throughout. You couldn't, there's no way that you can interpret that first sentence as covering citric acid from anywhere else. Because the order only applies to China. What Congress has done is overlooked that orders have not only physical descriptions, but also limited geographically to a particular country. So their reading is inconsistent with the limitations, these dual limitations that put an impact on anti-dumping and counter-dialogue duty orders. So we believe that straightforward reading of the orders needs to result that citric acid from some third country constitutes an other ingredient. And that one you have a blend of 65% non-sub-excitric acid, that is excluded under the second clause of the second sentence. It's hard for me to reach that conclusion when it says all grades and gradual sizes of citric acid in the first sentence. And the second sentence says blends with other ingredients. It's hard for me to reach the conclusion that an other ingredient is citric acid. Well it's citric acid from another country because other ingredients refers back to the first sentence. And what does cover the first sentence? And the first sentence doesn't say Chinese citric acid is said. But it's part of the anti-dumping order that covers only China. Right, which is why they're only going after whatever it is 35% of what you're bringing in. They're not trying to assess the duty on 100% of what you're bringing in. But our position is yet that that's what makes sure I get the facts right. But our position is that the entire length is excluded under the second clause of the second sentence. There's other ingredients. I think you are too narrowly construing what that means. It's other than what precedes it and what precedes it can only be considered Chinese citric acid. Doesn't say that in that prior sentence. It says all grades and gradual sizes of citric acid. If you look at the scope, it covers citric acid from China. So how could a description of a product include something other than citric acid from China? See, that has to permeate the entire understanding of the scope language. We're not talking about citric acid in the abstract otherwise. And you would absolutely be right if they were trying to assess duty against 100% of your product. It seems to me because if they were assessing duty against 100% of your product, they would be treating it as though it was all citric acid from China. But the error that they're making is treating us not as he glint under the second clause of the second sentence. But as... You do realize that you're not a blended sort of the traditional sense of the word. There's citric acid and there's more citric acid that's not blended with anything. It's all citric acid. Oh, but it's Chinese citric acid blended with non-chinese. Is there some technological difference between the two? No. No difference other than country of origin. There's no difference chemically. It's just a country of origin. No. So, even inside, I'm not sure what the country of origin would be or perhaps under customs principles, the Chinese and non-chinese portions would be allocated to different countries. But in this case, the plain definition of blend means mixing something with something else. And the something that's being blended is the Chinese citric acid, something else. Of course, by your definition, if you take 10% Chinese citric acid and add 25% Chinese citric acid, that's a blend. No, you're blending them. Not under the terms of the order, all right? Because when it's talked about, when it says citric acid in its comp blended forms, the blend that is being referred to is going to be the blend of Chinese citric acid. See, the order doesn't cover individual companies per se. It covers citric acid from China. So, the blend is something being blended in with citric acid from China, no matter what lot it came from or no matter what company it came from. So, we believe that there's no other interpretation of other ingredients that commerce's statement that were commingled rather than blended is simply wrong as a matter of vocabulary. Commingling is a synonym of blend. And so, what commerce is statically getting there is that we are blend. But I see no basis for saying that you have to be something other than citric acid in general, constituted blend. The way it set up is a blend to be something other than Chinese citric acid. And then you have to be something that is not being mixed with the order itself that we're talking about. I don't know. Don't call that major one. Well, you went through the rebuttal time. It's sort of a single issue which we understand. Yes, you want to say the rest of the time. I guess it is. Okay. Ms. McCafflin. And you're going to take ten minutes and then you'll blend your argument with Mr. Schneider. Oh, blend is trans. Or maybe commingle it. May I please the court? As this court knows, the court of national trade, we're going to have holds, commerce, as determinations as reasonable. But this is one of the rare cases in which they use the adverb eminently reasonable because there's really no question. There's no dispute that the subject product here is pure citric acid. What kind is the order on? Your Honor, I apologize. The order is the slip language decided at 74, Fed, right? At 27703. It's not including the appendix. How could you guys have a whole case about what the order says and not giving me the order? I don't disagree and apologize on behalf of the department for including that. But their federal register notices there. And that should be included. There's no question about it. But there's no dispute that this is a juror citric acid that falls squarely within the first sentence of the scope of language in the federal register notice. I apologize again. And the global commodities group repeatedly refers to the blended language as an exclusion and as Judge Carbin noted before, commerce's explanation for this was compelling because it's not an exclusion. It was intended to expand the scope of the order to include not just pure citric acid and pure citric, but to allow them to be blended with each other and to be blended with other ingredients. So the whole purpose of this, because the domestic industry demonstrated that the dumping of these products was causing injury to the domestic industry, the purpose of it was to have a scope of the order of cover so there could be a proper remedy for this. And all scope orders limited geographically, isn't that an inherent aspect of the scope order? The scope order, I'm sorry, limited to what you are saying. Isn't it a geographic limitation that we're talking about? Yes, of course, Your Honor. But as on page 39 of the joint appendix and the preliminary scope rule in commerce identified two instances, at least two instances in which subject merchandise has been co-mingled with non-subject merchandise from other countries. And it proposed a methodology, the two cases one from 1952, which is US industrial chemical, and the second one from 1986, which is coastal states' marketing, and proposed a methodology to ensure that there's not an over-assessment of duties that only the citric acid that's from China is assessed duties. And there's a methodology that commerce proposed that wasn't any objection. Why is 40% citric acid from China okay as long as it's mixed with sugar, but it's not okay if it's mixed with citric acid from non-subject countries? I think it depends on the nature of the product. The fact of matters of commercial products such as citric acid was being dumped on the market in the United States. Theoretically, if you have a 90% sugar in this, this is right below. This was all just based on the face of the order you're saying that just from a pure language standpoint, that's the end of inquiry. All this analysis about what the order was intended to get to, none of that is in the record, is it? Well, the record, of course, the investigation and the record of what led commerce to do this. Even onto the plain language, other, let me back up a little bit. There's never been, and Global Commodities Group can't cite any case in which there's been a conflation between the country of origin and the physical description of the product. The physical description of the product relates to the physical characteristics of the product, whether it be sugar, whether it be churse of deg acid, whether it be citric salts. It's the physical description describes the product. The country of origin is a limitation, but it's exogenous to the physical description. And the idea that, and even Global Commodities Group has to admit that it, and page 10 of its blue brief, refers to an inherent geographical restriction, or geographic restriction, which is an odd, which is an odd pure plain language argument to be making, to be drawing inferences into your plain language argument, because there isn't any expressed geographic limitation. So this was a product that was defined, originally as pure, and commerce has a clarification, and the domestic industry added this other language to include lens, to make sure that the injury would be fully emanated. Again, there's no overreaching, because there's only an assessment and duties of that portion of the commingled citric acid that's from China. And another point for us, just to get a context of what's really going on here, is this product did not exist before the order. The order is being, this product is being sort of coincidentally held to being less than 40% Chinese. It's tailored to the order to avoid the order. There is product that being tailored to the order, on page 17, I'm sorry, page 13. But going to the language of the order itself, you agree when it says the scope of these orders includes all grades, granulation sizes of citric acid. It really isn't all sizes of citric acid. It's all sizes of citric acid from China. The scope of this order doesn't include citric acid from another country, correct? Correct. But let's pay a high-pithetically, the commissive never asked for clarification of the domestic industry, and this London language was never added. I imagine that it would be undisputed that even a portion of citric acid, your citric acid that is commingled with citric acid from other countries, would still be subject to the order. Subject to this methodology, which was used in 1952 and 1952 used in 1986, where there's just a proper assessment. Does it fall squarely within the London language? Well, I don't think he would agree, because he would say, as he does now, that he's a blend, and the first sentence as the scope of these orders includes all grades and granulations of citric acid in their unblended forms. But citric acid is, I'm sorry, but that sentence was there before they added the blended sentence. So I think he would say that this scope, that his product, once it's blended, isn't pure citric acid, and the first sentence only covered pure citric acid from China. But blended refers to the physical characteristics, and mingling citric acid with other citric acid does not change the physical cracked characteristics. There's been no such substantial transformation in this process. Well, but the thing here that says this is limited to the physical characteristics, in fact, the sentence begins the scope of these orders. Well, you acknowledge that the scope of these orders is not just to citric acid, it's to Chinese citric acid, that the physical citric acid, that is identical to Chinese citric acid, but originates from another country, would not be covered. I respectfully disagree with you, Your Honor. Would you cover the citric acid that comes from Haiti, it's covered? No, but if there's a portion of the, of the portion of the citric acid that comes from China, it is covered. And then the proper approach would be to have a methodology that captures just that portion. But you want me to read this scope sentence as limited to citric acid from China, is that right? Yes. Even though it has 65% citric acid from, say, Korea. Yes. So long as it's coming from China. Because it's coming from China. So long as the, the, the, the, the portion of the citric acid from China is, is, is properly assessed the duties and ask the methodology. And that's what happened. The, you know, as I get, again, the, the Department of Commerce has faced incidents of the past as it, as explained on, and it's, um, preliminary scope ruling, which, and there was no objection to this methodology of, of, of using assessments, assessing duties just to deal with the, the portion of the co-mingled merchandise that's under, under the order. But the point I want to make is that this was, there was never a market for this product beforehand. And this is, this is essentially a giant batch. It, it, it, it, a page 17, of, well, well, try, well, making a product that is designed to comply with a governmental order isn't a bad thing. And in other words, we want them to try to comply with governmental orders, right? But this was never the intent. This, with, this is, this is creating a new product that has the consists of, of citric acid, pure citric acid. And, and it's just, it's, it's, it includes the, you would say this is designed to, you would say this is designed to avoid the governor. Well, I don't, I want to be careful because there hasn't been a circumvention inquiry and I don't want to overstate it. But clearly, when, when, when a page 17 of the, of the reply break, global conities were used as a term loophole. That's their word, not our word. They're, they're, they're looking for this as a, as a loophole. I don't really contour it to the intensive commerce. And, and there is a, what? The commerce has already said that if you bring in less than, if one that has less than 40% citric acid from China, then it's okay. And so they're bringing in less than 40% citric acid from China. So why isn't that a problem? You're wondering, is that would be referring to a different product, not pure citric acid. The blend would be, for instance, if you have 98% sugar and you're adding a little bit of citric acid. No, you can ask it a little bit. You can add up to 40%. But that's a different product than a different harmonized tariff classification. It's, it, there hasn't been any demonstration that that type of product would cause injury to the Mexican industry. There has been a, there has been a demonstration here that citric acid, pure citric acid from China has caused a substantial injury to the domestic industry. And this product has not been substantial transformed. There's no objection to commerce, there's substantial transformation analysis. And if there are any further questions, respectfully request that. Thank you, Ms. McCawthing. Mr. Schneideman is representing ADM. Is it ADM? Yes, thank you, Your Honor, please the court. I think what we have here is that Mr. Thompson just fundamentally misunderstands how the physical description of the class or kind must be read in conjunction with the country of origin or not. As we've said in our brief, first you look exclusively at the physical description of the class or kind without any regard to the country of origin. So you don't insert the works from China in that first sentence. And at the completion of that analysis, then you ask, well, is the country of origin for this product from China? The reason we have. So your argument really is that blend that a blend has to include something other than pure citric acid. Other than pure citric acid. And more importantly, you look at the first term, the first term, is it blend? If it is, then you ask, is the country of origin in China? And that question is not answered by saying, well, does it include citric acid from China? The example that Mr. Thompson gave is, if you have French citric acid, which you then mix with Mexican sugar in China, he's saying if you read the scope of the way Congress would like, that would nullify the country of origin in parliament, bring this within the school. The problem with that is that when you look at a true blend, such as citric acid and sugar, the question is, where does substantial transformation occur? If substantial transformation occurs in China, it's either bringing in French citric acid, transform it into China, that is a blend that is covered by the scope of the order because the country of origin becomes China. Essentially, the French nature of the gastric becomes an article of China, that is covered by the scope of origin. It's not before you, but it shows that you don't, in other words, it shows that you have to look at the physical description independently from country of origin. Why aren't the other ingredients anything that isn't the ingredients about which the duty is being assessed, so why isn't citric acid from another country and other ingredient? Because, as I said, first you look at the physical description, the first sentence covers pure citric acid, that's what we have here, pure citric acid. His argument is that if you don't, if you interpret other ingredients to, if you don't interpret the word other ingredients to include citric acid from other countries, you nullify the country of origin in parliament. Well, you don't. If you have a blend, the question is, is that blend from China? It doesn't nullify the country of origin in parliament. If the blending in China is substantial transformation, then it doesn't matter whether the citric acid was produced in China. So the scope is not necessarily restricted to blends. There's no basis to say that the scope only includes blends where the citric acid production and blending was performed in China regardless of what you're saying. I'm confused. Maybe you misbogra me again, I misunderstood you. Are you saying that if they took citric acid, not from China, not Chinese citric acid and blended it with other stuff somehow, it could fall within this duty? It depends if it's a substantial transformation occurs, confirming Chinese origin. I was pretty sure that this duty as I understood the government arguing it applies to citric acid from China. That's correct. At war blends of citric acid. Right. Where the citric acid component has to come from China. Not necessarily, your honor, respectfully. If it also, it does include pure citric acid originator from China. But if it's a blend, you then have to end again. You look at blend without regard to country of origin of where the components are originating from. You have to decide is that blend from China? And to do that, you have to look at where the citric acid transformation occurs. If they're importing, I'm not taking a position on whether mixing citric acid with sugar is a significant information. If it's not, then obviously China is not the country of origin. It wouldn't be covered by this code. But if it is, then it doesn't matter what it's. The summary of commerce is that our register says commerce department is issuing anti-cubic duty orders on citric acid and certain citric acid salts from Canada and China. So I don't see how a blend if the citric acid itself doesn't come from China is included in the studio order. Well, again, that's not the issue presented here. The reason I bring it up is because Mr. Thompson presented as an example to say that that would be the logical conclusion if you adopted commerce's interpretation. I don't think there's any problem with that logical conclusion. I think that blends if they're originating from China for the blend is within the physical scope. And at originates from China, I don't see a problem with that fall on within the scope of the order. There's nothing that says that the in the case of a blend that the citric component has to originate from China. But again, we're not even in a hypothetical situation. This is a pure citric product. And there's no, it's not as uncontested that the country of origin for that citric product is China. Is it your final thought? I would concur with Ms. McCarthy's description of this as an attempt to evade or shorten that the order. I frankly, I think the whole argument that they've come up with is a post-hoc explanation. I think that they were in their original questions. That's sort of coloration. Nothing for that. Thank you very much, Mr. Shredman. Mr. Thompson has for half minutes to report if he needs it. I'll speak to you, Mr. Hunter. That would not speak so fast. First thought, I'd like to address the supposed two-step process under which the first question is, is this citric acid from anywhere and then is it from China? Nothing were to be unitary. It only covered citric acid from China. So this attempt to say, well, somehow the first sentence could be construed to cover all citric acid from anywhere. And then we then can start to hear only assessed on the amount from China. Well, see, that would be if we didn't have that second clause, that would be a proper outcome. But it's the second clause, and we heard the government say, well, that includes certain products. But by necessary implication, it also excludes products that have below the threshold of 40% Chinese citric acid. Your concept is whatever you mix it with, as long as you keep it under 40% you're fine. Exactly. And Judge Moore, you put the case much better than I have in the past couple of years. But that is precisely what we are arguing. Anything other than Chinese citric acid, which is the product, that is to find the first sentence is in other ingredient. So then why didn't they just say in the first sentence that it applies to un-lended citric acid, as long as it's not less than 40%. I'm not sure why they posed the exclusion and the inclusion this way. It was, I speculate, but... Don't worry with the government that they're really different products and cause different damage to the domestic injury industry. Don't agree at all. The exclusion was crafted by the petitioners to identify products after whatever reason they didn't see as injurious or at least subject to the case. So the question is, what is the interpretation of the language that petitioners crafted? Again, there was a brief discussion of sort of the history of this provision. You go to page 11 of our brief, page 16 of the governance brief, this is our brief. We have a quote from the correspondence that petitioners had with COSCO, with COSCO. And they said that their concern was they defined subject merchandise as citric products. And then they said, so this goes to the exclusion and it says as well as one's, the other agrees in which one more of citric products represent the predominant inclusion. Well, citric products there that they refer to is the subject merchandise, citric from China. They have defined and quirk and commerce both got this wrong, but they weren't looking to expand into all citric products. They defined it in their correspondence. The citric that they were referring to was the subject merchandise from China. So this idea that they were trying to come up with a very expansive provision is simply bellowed not only by the scope language in our view, but also to the extent that it's probably to consult the sort of history, how this provision was adopted. It's bellowed by their own characterization to the agency. The government identified a couple of cases in which chemical products had the dumps and non-dumped parts separated out. That's very interesting. What is beside the point here, those orders did not have the blend exclusion language that we have here. And that's what makes all the difference. I would agree. That blend language didn't apply, then we would have a very different case. But unlike every other dumping word that I'm aware of, there is an exclusion for certain blended products. So what's being presented to the court is whether or not citric from China blended with citric from another country constitutes an excluded blend. So if there are no further questions, you're on our own. Thank you, Mr. Thompson. It's a case on the advisory