Pharmax Brings Tariff Challenge to Court of International Trade

On Wednesday a case was filed in the Court of International Trade by Pharmax N.A. Inc. against the United States and the Office of the United States Trade Representative. The case is regarding the impact of ad valorem tariffs imposed on goods imported from the People’s Republic of China.

Section 301 of the Trade Act of 1974 (19 U.S.C. § 2411) permits the United State Trade Representative to conduct investigations and to impose actions in response to that investigation so long as the action is imposed within 12 months of the instigation of the investigation, the complaint indicated.

The plaintiff accuses the United States Trade Representative of having instigated an investigation into unfair intellectual property practices in the People’s Republic of China, however the initiation of tariffs following the investigation were implemented in two phases. The plaintiff claims that the “List 1” and “List 2” tariffs were implemented within the 12 month time period, but the later tariffs implemented on “List 3” and “List 4a” goods was not implemented in a timely manner.

The plaintiff also claims that the second group of tariffs were not tied to the subject of the investigation and were implemented arbitrarily and capriciously with no official recording of the analysis of the increased burden and no comment period as required under the Administrative Procedures Act.

The plaintiff is suing for declaratory judgment regarding the violation of the Trade Act of 1974 and violation of the Administrative Procedures Act and seeks injunctive relief regarding the “List 3” and “List 4a” tariffs that are currently being collected. Plaintiff is being represented by Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP.