In the Supreme Court of the United States
CORUS STAAL BV AND CORUS STEEL USA, INC., PETITIONERS
DEPARTMENT OF COMMERCE, ET AL.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENTS
PAUL D. CLEMENT
Counsel of Record
GREGORY G. KATSAS
Acting Assistant Attorney
DAVID M. COHEN
JEANNE E. DAVIDSON
Department of Justice
Washington, D.C. 20530-0001
Whether the court of appeals correctly sustained the Department of Commerce's longstanding, and admit tedly reasonable, construction of a domestic anti dumping statute, notwithstanding World Trade Organi zation and North American Free Trade Agreement panel reports interpreting a purportedly analogous provision in an international trade agreement, where Congress has specifically provided that international panel reports have no legal effect with respect to federal law except as implemented by the Executive Branch or Congress.
In the Supreme Court of the United States
CORUS STAAL BV AND CORUS STEEL USA, INC., PETITIONERS
DEPARTMENT OF COMMERCE, ET AL.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENTS
The opinion of the court of appeals (Pet. App. 1a-10a) is reported at 395 F.3d 1343. The judgment and opinion of the Court of International Trade (Pet. App. 11a, 12a- 46a) are reported at 283 F. Supp. 2d 1357.
The judgment of the court of appeals was entered on January 21, 2005. A petition for rehearing was denied on May 18, 2005 (Pet. App. 61a-62a). On July 28, 2005, the Chief Justice extended the time within which to file a petition for a writ of certiorari to and including Sep tember 15, 2005, and the petition was filed on that date. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1).
1. The Anti-Dumping Act, 1921, 19 U.S.C. 1673 et seq., and the Tariff Act of 1930, 19 U.S.C. 1001 et seq., have long provided for the imposition of antidumping duties where "foreign merchandise is being, or is likely to be, sold in the United States at less than its fair value." 19 U.S.C. 1673.1 If the sale of a product at less than its fair value causes or threatens injury to an indus try in the United States, the statute provides for imposi tion of an antidumping duty "in an amount equal to the amount by which the normal value [i.e., the price when sold 'for consumption in the exporting country'] exceeds the export price [i.e., the price when sold 'to an unaffili ated purchaser in the United States']." 19 U.S.C. 1673, 1677a(a), 1677b(a)(1)(B)(i).
In assessing whether merchandise is being "dumped" in the United States, the Department of Commerce ad justs both the "normal value" and the "export price" to achieve a "fair comparison" between the two. 19 U.S.C. 1677b(a). For example, the statute calls for subtracting transportation costs to the United States, if those are included in the export price, and eliminating the effect of import duties applied by the exporting country on imported parts. 19 U.S.C. 1677a(c), 1677b(a)(6) and (7).2
If the Department of Commerce makes a final deter mination that merchandise is being sold in the United States at less than its fair value, the Department is re quired to determine an "estimated weighted average dumping margin" for each exporter and producer and an "all-others" rate for those not individually investigated. 19 U.S.C. 1673d(c)(1)(B). Exporters and producers must then post a cash deposit or security for each entry in an amount based on the appropriate dumping margin. Ibid.
The statute specifies that the "dumping margin" is "the amount by which the normal value exceeds the ex port price," and that the "weighted average dumping margin" is "the percentage determined by dividing the aggregate dumping margins determined for a specific exporter or producer by the aggregate export prices" for that exporter or producer. 19 U.S.C. 1677(35)(A) and (B).
Under the Department of Commerce's long-standing construction of the statute, there is a "dumping margin" only when the normal value at which a product is sold in the exporting country "exceeds the export price" to the United States by a positive value. 19 U.S.C. 1677(35)(A).3 In other words, if the export price is the same as or higher than the normal value, there is no, or zero, "dumping margin," and thus nothing to include when summing the "dumping margins" that the statute specifies as the numerator in the "weighted average dumping margin" ratio. 19 U.S.C. 1677(35)(B).4
Once an affirmative dumping determination has been made, the statute provides for an administrative review of the antidumping duty to be conducted on an annual basis, upon request. 19 U.S.C. 1675. The dumping mar gin that is determined during the course of this review then becomes the basis for estimated antidumping du ties that are collected on new entries of merchandise and for the assessment rates for importers. 19 U.S.C. 1675(a)(2)(A) and (C).
2. In 1994, the United States became a signatory to several Executive agreements, known collectively as the Uruguay Round Agreements (the Agreements), one of which is the Agreement on the Implementation of Arti cle VI of the General Agreement on Tariffs and Trade (Antidumping Agreement), reprinted in H.R. Doc. No. 316, 103d Cong., 2d Sess. Vol. 1, at 1453 (1994). Con gress enacted the Uruguay Round Agreements Act (URAA), 19 U.S.C. 3501 et seq., to implement those Agreements. 19 U.S.C. 3511. In the URAA, Congress established detailed rules regarding the relationship between the Agreements and domestic law (including domestic trade laws), as well as an elaborate process for dealing with disputes concerning the consistency of do mestic laws with the Agreements.
As a general matter, Congress emphasized the con tinuing primacy of federal law in the event of any con flict between it and the Agreements. As such, "[n]o pro vision of any of the Uruguay Round Agreements, nor the application of any such provision to any person or cir cumstance, that is inconsistent with any law of the Unit ed States shall have effect." 19 U.S.C. 3512(a)(1). Con gress further stated, with respect to the interaction of the URAA and federal law, that "[n]othing in this Act shall be construed * * * to limit any authority conferred under any law of the United States * * * unless specifi cally provided for in this Act." 19 U.S.C. 3512(a)(2).
The URAA also clarifies that neither the Uruguay Round Agreements nor the fact of Congress's approval of the Agreements creates privately enforceable rights or provides a basis for challenging Executive Branch action:
No person other than the United States-
(A) shall have any cause of action or defense under any of the Uruguay Round Agreements or by virtue of congressional approval of such an agreement, or
(B) may challenge, in any action brought under any provision of law, any action or inaction by any de partment, agency, or other instrumentality of the United States * * * on the ground that such action or inaction is inconsistent with such agreement.
19 U.S.C. 3512(c)(1).
Because the URAA specifies that the Agreements create no privately enforceable rights and cannot pro vide the basis for challenging administrative actions, disputes with respect to the United States' compliance with its obligations under the Agreements can be brought only through the mechanisms provided in the Agreements themselves. See The Understanding on Rules and Procedures Governing the Settlement of Dis putes (Dispute Settlement Understanding), 33 I.L.M. 1226 (1994); 19 U.S.C. 3511(d)(16). Those procedures include bringing disputes before a World Trade Organi zation (WTO) panel, the findings of which can be ap pealed to the WTO Appellate Body. See Dispute Settle ment Understanding, Arts. 6, 17, 33 I.L.M. at 1230, 1236. Private entities may not initiate a proceeding be fore a WTO panel; rather, only a WTO Member may invoke the WTO dispute settlement procedures. Id. Art. 2.1, 33 I.L.M. at 1226.
Congress was very specific, when it enacted the URAA, about the manner in which the United States would respond to reports issued by WTO panels or the WTO Appellate Body. The Statement of Administrative Action (SAA) approved by Congress in connection with the passage of the URAA, see 19 U.S.C. 3511(a), 3512(d), makes clear that WTO panels and Appellate Body reports "will not have any power to change U.S. law or order such a change." H.R. Doc. No. 316, supra, at 659. Nor may a party ask a court to direct implemen tation of a WTO Report. To the contrary, "[o]nly Con gress and the Administration can decide whether to im plement a WTO panel recommendation and, if so, how to implement it." Ibid.
In the URAA, Congress established two methods for implementing certain types of WTO dispute settlement reports. One method deals with the amendment, rescis sion, or modification of an agency regulation or practice that a WTO report indicates is inconsistent with the Uruguay Round Agreements, including the Antidumping Agreement. Section 3533(g) specifies that the regulation or practice that the WTO body has found inconsistent with the Agreements "may not be amended, rescinded, or otherwise modified * * * unless and until" the elaborate procedures set forward in the subsection have been complied with. 19 U.S.C. 3533(g)(1) (empha sis added). The United States Trade Representative (USTR) is required to consult with the appropriate con gressional committees, agency or department head, and private sector advisory committees, and to provide an opportunity for public comment, before determining whether and how to implement a WTO report. 19 U.S.C. 3533(g)(1)(A)-(E). No implementation may become ef fective until the relevant congressional committees have been allowed a specified period of time to indicate their agreement or disagreement with the proposed imple mentation. 19 U.S.C. 3533(g)(2) and (3).
A second procedure for implementing a WTO report in domestic law is set forth in 19 U.S.C. 3538. Section 3538 is narrower in scope than Section 3533(g), and ap plies, inter alia, to the situation in which a WTO dispute settlement report indicates that an action by the Depart ment of Commerce in an antidumping proceeding was not in conformity with the United States' obligations under the Uruguay Round Antidumping Agreement. 19 U.S.C. 3538(b)(1).5 Like the statutory procedure under Section 3533, Section 3538 provides for consultation be tween USTR and relevant stakeholders before USTR makes a determination whether and how to implement the WTO body report. Section 3538 specifies that "[b]efore the administering body implements any deter mination * * * the Trade Representative shall consult with the administering authority and the congressional committees," 19 U.S.C. 3538(b)(3) (emphasis added), and the administering authority "shall provide interested parties with an opportunity to submit written comments and, in appropriate cases, may hold a hearing," 19 U.S.C. 3538(d). Upon completion of this process, USTR "may * * * direct the Department of Commerce to im plement, in whole or in part," a new determination con sistent with the WTO body's findings. 19 U.S.C. 3538(b)(4) (emphasis added).
If USTR requests that the Department of Commerce issue a new determination and orders Commerce to im plement it, the new determination applies only to "un liquidated entries of the subject merchandise" that are entered or withdrawn from warehouse for consumption on or after the date the USTR directs the Department of Commerce to implement the new decision. 19 U.S.C. 3538(c)(1).
In the URAA, Congress made clear that the USTR could, after consultation, choose not to alter the adminis trative action that is the subject of an adverse WTO re port, and may instead offer the complaining party trade compensation in some other form. 19 U.S.C. 3538(b)(4) (USTR "may" direct implementation of new determina tion consistent with WTO report "in whole or in part"); H.R. Doc. No. 316, supra, at 1015; 19 U.S.C. 3533(f)(3) (requiring USTR to consult with the appropriate con gressional committees "concerning whether to imple ment the report's recommendation and, if so, the man ner of such implementation and the period of time needed for such implementation") (emphasis added). Importantly, the political branches could decide not to implement the new determination, but instead to com pensate our trading partners in some other way. See Dispute Settlement Understanding, Arts. 3.7, 22, 33 I.L.M. at 1227, 1239; H.R. Doc. No. 316, supra, at 1016.
3. Petitioners are a Dutch corporation, Corus Staal BV, and its wholly-owned American subsidiary, Corus Staal, USA, Inc., which manufacture and export steel products to the United States. In 2001, the Department of Commerce determined that hot-rolled steel from the Netherlands was being sold, or likely to be sold, in the United States at less than fair value. The Department calculated the weighted-average dumping margin by aggregating all model-specific dumping margins, assign ing a dumping margin of zero to those comparisons in which the United States price exceeded normal value. Hot-Rolled Steel Products from China, India, Indone sia, Kazakhstan, the Netherlands, Romania, South Af rica, Taiwan, Thailand, and Ukraine, 66 Fed. Reg. 57,482 (2001), adopting the Issues and Decision Memo randum for the Antidumping Investigation of Certain Hot-Rolled Carbon Steel Flat Products from the Nether lands; Notice of Final Determination of Sales at Less Than Fair Value (Oct. 3, 2001). The antidumping duty order established a 2.59% weighted average dumping margin with respect to petitioners' exports. Antidumping Duty Order: Certain Hot-Rolled Carbon Steel Flat Products From the Netherlands, 66 Fed. Reg. 59,565 (2001).
4. Petitioners filed an action in the Court of Interna tional Trade challenging the Department's methodology for calculating the weighted average dumping margin. The court held that the Department had reasonably in terpreted the relevant statute, and rejected petitioners' contention that the Department's interpretation was unreasonable because it allegedly conflicted with a re port adopted by the WTO Dispute Settlement Body (DSB) interpreting the Antidumping Agreement. After noting that the Department's methodology has been repeatedly sustained by the Court of International Trade and the Federal Circuit, and that WTO panel re ports are not binding even within the WTO, the court concluded that a panel report, even if adverse to the United States' interests before the WTO, did not render the Department's statutory interpretation unreasonable. Pet. App. 29a.
5. The Federal Circuit affirmed. Pet. App. 1a-10a. The court held that the Department of Commerce's in terpretation of the relevant statute, which the court agreed was ambiguous, was reasonable. Id. at 5a-6a. Noting that WTO reports are not binding upon the United States, let alone United States domestic courts, the court of appeals observed that, pursuant to statute, "[n]o provision of any of the Uruguay Round Agree ments * * * that is inconsistent with any law of the United States shall have any effect." Id. at 8a (quoting 19 U.S.C. 3512(a)). In particular, the court of appeals noted that Congress has established a procedure by which the Executive Branch will, "in consultation with various congressional and executive bodies and agencies, * * * determine whether or not to implement WTO re ports and determinations and, if so implemented, the extent of implementation." Id. at 9a. The court refused to overturn the Department of Commerce's interpreta tion of an ambiguous statute "based on any ruling by the WTO or other international body unless and until such ruling has been adopted pursuant to the specified statu tory scheme." Id. at 10a.
The court of appeals correctly held that the Depart ment of Commerce's calculation of aggregate dumping margins in the investigation at issue in this case was reasonable. The decision of the court of appeals does not conflict with any decision of this Court or any other court of appeals. Further review therefore is unwar ranted.
1. Petitioners contend (Pet. 2-4, 14-20) that the Court should grant certiorari to determine whether an agency's otherwise reasonable interpretation of a stat ute, which would normally be entitled to deference un der Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), must be overturned in light of Murray v. The Schooner Charming Betsy, 6 U.S. (2 Cranch) 64 (1804), on the ground that the chal lenged agency practice is allegedly inconsistent with an international body's interpretation of an Executive agreement to which the United States is a party. Peti tioners rely (Pet. 3) on this Court's observation in Charming Betsy that "an act of Congress ought never to be construed to violate the law of nations if any other possible construction remains," 6 U.S. (2 Cranch) at 118. According to petitioners, the Charming Betsy canon establishes broad judicial authority to compel the Exec utive Branch to conform its implementation of domestic law to principles of international law. For example, peti tioners urge that "the Charming Betsy rule necessarily excludes from the range of otherwise reasonable inter pretations" those that have been held by an interna tional body to violate an international obligation of the United States, even when the agency's interpretation has been upheld repeatedly under Chevron. Pet. 22. See Pet. 3 ("where, as here, a Department interpretation [has been held by a WTO body to be] inconsistent with U.S. treaty obligations, the Charming Besty doctrine renders that interpretation unreasonable" and no longer entitled to Chevron deference).
We note at the outset that neither Charming Betsy nor any other decision of this Court applying that prece dent stands for the broad principle advocated by peti tioners. Charming Betsy itself dealt with the question whether a domestic statute prohibiting trade by Ameri cans with France should be construed to apply to an American ship that had been purchased by a citizen of Denmark, a country that was neutral with respect to the hostilities between the United States and France. 6 U.S. (2 Cranch) at 115-116. Thus, the question specifi cally addressed by the Court was whether the statute adopted by Congress should "be construed to violate neutral rights, or to affect neutral commerce, further than is warranted by the law of nations as understood in this country." Id. at 118.
This Court's subsequent cases applying Charming Betsy have likewise involved avoidance of "unreasonable interference with the sovereign authority of other na tions." F. Hoffman-La Roche Ltd. v. Empagran S.A., 124 S. Ct. 2359, 2366 (2004) (application of antitrust stat ute to conduct with adverse foreign effect). See Weinberger v. Rossi, 456 U.S. 25, 32 (1982) (application of employment discrimination statute to bases in foreign lands that were the subject of Executive agreements with the host governments); McCulloch v. Sociedad Nacional de Marineros de Honduras, 372 U.S. 10, 20-22 (1963) (application of National Labor Relations Act to foreign-flag vessels); Lauritzen v. Larsen, 345 U.S. 571, 578 (1953) (application of Jones Act in maritime cases); see generally Hartford Fire Ins. Co. v. California, 509 U.S. 764, 814-815, 817 (1993) (Scalia, J., dissenting) (de scribing principle as one of "prescriptive comity," that "Congress is generally presumed not to have exceeded those customary international-law limits on jurisdiction to prescribe").
This case is not a proper vehicle for considering whether the Charming Betsy canon should be extended in the manner advocated by petitioners. That canon, whatever its proper scope, has no application when, as here, Congress has unambiguously specified that alleged conflicts between a domestic agency action and the rele vant international agreements are to be resolved through consultation between the Executive and Legis lative Branches, and not through litigation in domestic courts.
2. Congress has expressly precluded attempts, such as petitioners', to use the courts of the United States to compel the Department of Commerce to act in confor mity with the Uruguay Round Agreements. Section 3512(c)(1)(B) specifically provides that "[n]o person * * * may challenge, in any action brought under any provi sion of law, any action or inaction by any department * * * on the ground that such action or inaction is incon sistent with [one of the Uruguay Round Agreements]." 19 U.S.C. 3512(c)(1)(B). Petitioners' challenge falls squarely into that forbidden category; they claim (Pet. 21) that "the Department's practice of zeroing negative dumping margins in investigations violates the require ments" of the Antidumping Agreement, and that "[t]his treaty violation warrants plenary review and reversal of the decision below." See id. at 15 (characterizing the issue presented as "whether the Department's interpre tation ran afoul of U.S. treaty obligations").6
In apparent recognition that Section 3512(c) bars a challenge based directly upon an alleged inconsistency between the Department's determination and the Antidumping Agreement, petitioners attempt to charac terize their arguments as arising out of a "conflict over the proper interpretation of the statutory definition of the fundamental term 'dumping margin' in 19 U.S.C. § 1677(35)(A)." Pet. 14. Tellingly, however, petitioners make no argument that the Department of Commerce's practice is inconsistent with the language of the statute or otherwise inappropriate, apart from their claim that the Department's view is inconsistent with the opinions of various WTO or binational panel reports.7
As the court of appeals correctly held, Congress has specified a process for resolving disputes over the United States' compliance with its obligations under the Uruguay Round Agreements, a process that involves international dispute resolution mechanisms and, follow ing the completion of that process, a determination by the political branches of this Nation's government whether and how to implement the international body's findings. Petitioners seek to circumvent that process by invoking the authority of the federal courts in an effort to obtain a remedy that Congress has expressly made unavailable.
As previously noted, see p. 6, supra, only a WTO Member, not a private party, may initiate proceedings under the Dispute Settlement Understanding. The Eu ropean Communities have, in fact, initiated a dispute settlement proceeding before a WTO panel that encom passes, among other things, the Department of Com merce's antidumping determination with respect to peti tioners' steel products. That proceeding is still ongoing.
Even assuming that petitioners' view of the Anti- dumping Agreement's provisions is upheld through the WTO process, the Department of Commerce will not necessarily need to amend the antidumping determina tion regarding petitioners' products. As the court of appeals correctly observed, the United States need not implement an adverse WTO report. Pet. App. 9a. Con gress has specifically provided, and the Dispute Settle ment Understanding similarly recognizes, that a WTO Member possesses discretion to decide whether and how to implement a WTO report that finds that the Member acted inconsistently with its WTO obligations. Instead of implementing a WTO report, a Member may choose to offer compensation or other trade concessions to the Member that brought the WTO proceeding. See Dis pute Settlement Understanding, Arts. 3.7, 22, 33 I.L.M. at 1227, 1239; 19 U.S.C. 3538(a)(6) and (b)(4); H.R. Doc. No. 316, supra, at 1016.
The decision whether to implement a WTO report "in whole or in part," 19 U.S.C. 3538(b)(4), would be made by USTR after completing the statutorily required pro cess for gathering input from congressional, administra tive, and private sector stakeholders, 19 U.S.C. 3538(b)(1)-(3) and (d). Moreover, even assuming that USTR directs the Department of Commerce to issue a new determination consistent with petitioners' under standing of the Antidumping Agreement, Congress has specified that the new determination would have only prospective effect "with respect to unliquidated entries of the subject merchandise * * * that are entered, or withdrawn from the warehouse, for consumption on or after * * * the date on which the Trade Representative directs the [Department] to implement that determina tion." 19 U.S.C. 3538(c)(1)(B). Thus, petitioners seek relief-recovery of duties already paid (Pet. 18)-that is more generous than the remedy provided by Congress under the applicable statutory framework.
Contrary to petitioners' assertion (Pet. 30), the court of appeals' recognition of the primacy of this statutory scheme does not strip Congress of its "voice" in interna tional commerce. Rather, Congress has spoken clearly and unambiguously by providing that only the political branches shall have the authority to determine whether and how to respond to an adverse WTO report. The statute is also clear that, to the extent that there is a conflict between federal law and the Uruguay Round Agreements, federal law must prevail. Indeed, it is peti tioners' approach that, if implemented, would strip Con gress and the Executive Branch of the powers that Con gress intended the two branches to retain in the interna tional trade arena.
Contrary to petitioners' characterization, the court of appeals did not hold that Sections 3533(g) and 3538 "foreclose judicial review of a claim that the Department has improperly interpreted an ambiguous provision of the Tariff Act." Pet. 28. Rather, the court of appeals considered and rejected on the merits petitioners' argu ments that the Department of Commerce had adopted an unreasonable and impermissible interpretation of the statutory requirements to make a "fair comparison * * * between the export price * * * and normal value," Pet. App. 7a n.5 (quoting 19 U.S.C. 1677b(a)) , and to use a "weighted average" in doing so, id. at 5a (quoting 19 U.S.C. 1677f-a(d)(1)(A)(i)). To the extent that, in ruling on the merits of petitioners' statutory arguments, the court of appeals refused to give determinative weight to the decisions of WTO bodies construing provisions of the Antidumping Agreement, the court of appeals was sim ply giving effect to Congress's directives that the deci sion whether and how to implement a WTO ruling is for the political branches, 19 U.S.C. 3538, and that "[n]o person * * * may challenge, in any action brought under any provision of law, any action or inaction by any de partment * * * on the ground that such action or inaction is inconsistent with [one of the Uruguay Round Agree ments]," 19 U.S.C. 3512(c)(1)(B).
3. The same arguments addressed in the preceding section were previously advanced in an unsuccessful petition for a writ of certiorari seeking review of Timken Co. v. United States, 354 F.3d 1334 (Fed. Cir.), cert. de nied, 125 S. Ct. 412 (2004) (No. 04-87). Petitioners urge that certiorari is appropriate now in light of post- Timken developments, in particular the development of a purported conflict between the holdings of the Federal Circuit and the recent ruling of a binational panel con vened under the North American Free Trade Agree ment (NAFTA), Dec. 17, 1992, United States-Canada- Mexico, 32 I.L.M. 289 (entered into force Jan. 1, 1994). See Pet. 16-17 (citing Certain Softwood Lumber Prod ucts from Canada (Softwood Lumber), Secretarial File No. USA-CDA-2002-1904-02 (June 9, 2005)).
Petitioners' reliance on a NAFTA arbitral decision is misplaced. Congress has made the option of binational panels available only with respect to imports covered by NAFTA, i.e., merchandise from Canada or Mexico. See 19 U.S.C. 1516a(g), 3434(c).8 In particular, challenges like that raised by petitioners in this case, whose prod ucts are imported from the Netherlands, are not subject to the NAFTA arbitration process. Thus, petitioners' claim of a "conflict" is based on a decision in an arbitra tion process to which they are not entitled.
Moreover, petitioners' alleged "conflict" is illusory. Pursuant to the terms of NAFTA, decisions of NAFTA panels are binding only with respect to the particular matter between the parties and before the NAFTA panel, and have no precedential effect. NAFTA, Art. 1904(9), 32 I.L.M. at 683. Congress has made clear that "a court of the United States is not bound by but may take into consideration, a final decision of a binational panel or extraordinary challenge committee convened pursuant to article 1904 of the NAFTA." 19 U.S.C. 1516a(b)(3). As the legislative history emphasizes, "[t]he intent of this provision is to make clear that a panel or committee decision is binding only with respect to the particular matter before that panel and does not constitute binding precedent on U.S. courts or other binational panels." North American Free Trade Agree ment Implementation Act, H.R. Rep. No. 361, 103d Cong., 2d Sess., Pt. 1, at 83 (1993) (emphasis added). See H.R. Doc. No. 316, supra, at 926 (noting, in connec tion with adoption of the URAA, that a United States- Canada binational "panel decision would not be binding precedent in future cases"). Therefore, the NAFTA panel decision in Softwood Lumber can have no effect upon this case, which involves different parties, a differ ent product, and a different investigation.
In addition, NAFTA panel decisions cannot create any "conflict" with the Federal Circuit because NAFTA panels are subject to Federal Circuit precedent. A NAFTA panel functions as a trial court, "replace[ing]" the Court of International Trade for purposes of review ing the antidumping duty, and is required to apply "ju dicial precedents to the extent that a court of the im porting Party would rely on such materials," which, of course, include Federal Circuit precedent. NAFTA, Art. 1904(2), 32 I.L.M. at 683. Thus, petitioners' argu ment that the Court should grant review because the court of appeals' decision "conflicts with a Binational Panel decision rendered less than a month after the Federal Circuit denied rehearing," Pet. 15, is akin to urging certiorari based upon a purported "conflict" be tween a Second Circuit opinion and a later decision of the United States District Court for the Southern Dis trict of New York. Such an assertion, if true, means only that the lower tribunal has failed to follow binding precedent.
In any event, the binational panel in Softwood Lum ber disavowed any conflict with the Federal Circuit's decision in this case. According to the panel, its "hold ings are consistent with the determination of the Court of Appeals for the Federal Circuit in Timken and Corus Staal." Pet. App. 101a. The panel reasoned that the court of appeals' decision in this case did not control the outcome in Softwood Lumber because the Federal Cir cuit had relied upon "the preclusive effect it found in various features of the URAA, most particularly * * * 19 U.S.C. § 3533; § 3538," which establish "specific statu tory procedures for determining whether the United States will implement WTO DSB decisions." Pet. App. 104a. While recognizing the importance of the WTO process and the statutory process for ensuring consulta tion within the political branches regarding whether and how to implement any WTO report, see Pet. App. 104a- 109a, the binational panel reasoned that the question presented before it was different because "[i]n Softwood Lumber, the Section /Section  process has run its course," and USTR had directed the Department of Commerce to issue a determination not inconsistent with the WTO report concerning Softwood Lumber. Pet. App. 109a. Plainly, then, by its own terms, the bina tional panel did not purport to make any determination about the interaction of Chevron deference and the Charming Betsy canon with respect to facts such as those presented in this case, in which the international dispute resolution mechanism and statutorily dictated process for deciding whether and how to implement the WTO outcome, if necessary, has yet to take place.9
4. Finally, contrary to petitioners' assertion, the decision below does not conflict with the decision of any other court of appeals regarding the question whether the Charming Betsy canon should be applied to invali date an agency action that would otherwise be entitled to Chevron deference. Indeed, petitioners cite no case in which a court of appeals has struck down an otherwise reasonable agency interpretation of an ambiguous stat ute on Charming Betsy grounds.
Petitioners claim that the court of appeals' opinion below conflicts with the D.C. Circuit's decision in George E. Warren Corp. v. United States EPA, 159 F.3d 616 (1998), amended on other grounds, 164 F.3d 676 (1999). But that case, which upheld an agency's discretion to take a WTO report into account in construing the rele vant statute, presents no conflict with the court of ap peals' ruling in this case. In Warren, the WTO issued an adverse opinion with respect to an Environmental Pro tection Agency (EPA) rule. 159 F.3d at 619. Pursuant to 19 U.S.C. 3533, the USTR "advised the WTO that the United States intended to comply" with the decision. 159 F.3d at 619. The EPA then promulgated a new rule intended to correct the WTO inconsistency. Id. at 619- 620. The plaintiffs in Warren challenged the EPA's con sideration of the WTO report in promulgating its new rule. The D.C. Circuit held that nothing in the text or structure of the statute indicated that "Congress in tended to preclude the EPA from considering the effects a proposed rule might have upon the * * * treaty obliga tions of the United States." Id. at 623. The D.C. Cir cuit's opinion, which permits an agency to consider a WTO report when the Executive Branch determines that compliance is appropriate, provides no authority for petitioners' claim that an agency is required to amend its practices to conform to a WTO report with which the Executive Branch disagrees.
The decision below is entirely consistent with War ren. Petitioners contend otherwise (Pet. 24), asserting that the effect of the court of appeals' decision was to deprive the Department of Commerce "of discretion to interpret the statute in a manner that does not violate U.S. treaty obligations," but the court of appeals held no such thing. To the contrary, in Timken, the Federal Circuit specifically concluded that "the statute does not directly speak to the issue of negative-value dumping margins." Timken, 354 F.3d at 1342. Plainly, then, the court of appeals did not hold that the statute precludes the Department of Commerce from revising its interpre tation of the statute in a manner consistent with WTO rulings.10
Finally, petitioners cite Ali v. Ashcroft, 346 F.3d 873 (9th Cir. 2003), as an example of a recent case in which the "interplay between the Charming Betsy rule and Chevron analysis has already arisen." Pet. 26. Before it even reached the Charming Betsy question, however, the Ninth Circuit held that the agency was "not entitled to deference" because its "position is inconsistent with existing [agency] policy and regulations." 346 F.3d at 885. Plainly, then, Ali does not support petitioners' ar gument that an agency's long-standing and otherwise reasonable construction of an ambiguous statute can be invalidated on the basis of the Charming Betsy interpre tive rule. In any event, this Court overruled Ali in Jama v. Immigration & Customs Enforcement, 543 U.S. 335, 125 S.Ct. 694 (2005). The Ninth Circuit thereafter vacated the opinion relied upon by petitioners. 421 F.3d 795, 797 (2005). A vacated opinion, of course, has no precedential effect. County of Los Angeles v. Davis, 440 U.S. 625, 634 n.6 (1979). Petitioners' claim of a conflict is thus without merit.11
The petition for a writ of certiorari should be denied.
PAUL D. CLEMENT
GREGORY G. KATSAS
Acting Assistant Attorney
DAVID M. COHEN
JEANNE E. DAVIDSON
1 This language was originally adopted in the Anti-Dumping Act, 1921, ch. 14, § 201, 42 Stat. 11, which, prior to 1979, was codified at 19 U.S.C. 160 et seq. (1976). It was subsequently reenacted in 1979 as Title VII of the Tariff Act of 1930, ch. 497, § 1, 46 Stat. 590, as part of a more general revision of customs laws relating to the General Agreement on Tariffs and Trade. See Trade Agreements Act of 1979, Pub. L. No. 96-39, Tit. I, § 101, 93 Stat. 162 (19 U.S.C. 1673 et seq.).
2 When, as in this case, there is a third-party intermediary, such as a broker or an affiliate of the seller, the statute calls for the Department of Commerce to use a "constructed export price," which entails further adjustment, including the elimination of commissions. 19 U.S.C. 1677a(b) and (d)(1)(A). Because the distinction between "export price" and "constructed export price" is irrelevant to the issues presented here, we will, for the sake of convenience, refer simply to "export price."
3 Under certain circumstances not relevant here, normal value may be calculated using third country sales, constructed value, or factors of production. 19 U.S.C. 1677b(a)(1)(C), (4) and (c)(3).
4 The denominator of the ratio-the "aggregate export prices" of the exporter's sales-is calculated by summing the export prices of all sales, including those that take place at or above the normal value. 19 U.S.C. 1677(35)(B). The inclusion of sales at and above the normal value in the denominator has the effect of lowering the weighted average dumping margin, and hence the antidumping duty, compared to what it would be if the denominator were derived by summing only the export prices for sales in which dumping occurred.
5 Section 3538(b)(1) also applies when an action by the Department of Commerce in a countervailing duty proceeding is found to be inconsistent with the Uruguay Round Agreement on Subsidies and Countervailing Measures ("Subsidies Agreement"), reprinted in H.R. Doc. No. 316, supra, at 1533. Section 3538(a)(1) applies when an action by the United States International Trade Commission is found to be inconsistent with the Antidumping Agreement, the Subsidies Agreement, or the Uruguay Round Agreement on Safeguards, reprinted in H.R. Doc. No. 316, supra, at 1577.
6 We note that, contrary to petitioners' characterization, the Uruguay Round Agreements are not "treaties," but, rather, Executive agreements that have been approved by Congress and implemented in federal law through implementing legislation. See generally 19 U.S.C. 2902, 2903, 3511(a), 3512.
7 The Federal Circuit has previously recognized the reasonableness of the Department of Commerce's construction of the statute, which has been upheld repeatedly over the past twenty years. See Timken Co. v. United States, 354 F.3d 1334, 1343 (Fed. Cir.), cert. denied, 125 S. Ct. 412 (2004); Bowe Passat Reinigungs-Und Waschereitechnik GmbH v. United States, 926 F. Supp. 1138, 1150 (Ct. Int'l Trade 1996); Serampore Indus. Pvt. Ltd. v. Department of Commerce, 675 F. Supp. 1354, 1360-1361 (Ct. Int'l Trade 1987). As the Court of International Trade has noted, "[t]he practice of considering negative margins as zero ensures that sales made at less than fair value on a portion of a company's product line to the United States market are not negated by more profitable sales." Serampore, 675 F. Supp. at 1360. In other words, "profitable sales" are not allowed "to 'mask' sales at less than fair value." Timken, 354 F.3d at 1343.
8 In a proceeding involving merchandise from Canada or Mexico, a party wishing to challenge either the Department of Commerce's initial determination or the results of an administrative review may do so in one of two ways. First, it may obtain review in the United States Court of International Trade. 19 U.S.C. 1516a(a)(1). Second, at the request of either party, review of the Department's determination may be had before a binational panel convened pursuant to Chapter 19 of NAFTA. 19 U.S.C. 1516a(g)(2). If a binational panel is requested, its authority is exclusive, with certain exceptions not relevant here. 19 U.S.C. 1516a(g)(2)-(4).
9 In any event, the binational panel's decision in Softwood Lumber is not final and, contrary to petitioners' characterization, does not categorically hold that "zeroing was unlawful under U.S. law." Pet. 16. The Department of Commerce has filed another remand determination in that case, which continues to employ "zeroing," although it does so on a transaction-by-transaction basis, in lieu of the more aggregated product-by-product basis employed in the Department's previous determination.
10 Petitioners cite to the court of appeals' discussion of petitioners' argument concerning the "fair comparison" requirement of 19 U.S.C. 1677b(a). See Pet. 24 (citing Pet. App. 7a-8a). Although the court of appeals correctly concluded that the "fair comparison" provision is irrelevant to this issue, because Congress provided an "exhaustive list" of the adjustments necessary to make a "fair comparison" between export price and normal value, see Pet. App. 7a; Timken, 354 F.3d at 1344, that conclusion does not detract from the court of appeals' explicit holding that the statutory definition of "dumping margin" in 19 U.S.C. 1677(35)(A) is ambiguous. Timken, 354 F.3d at 1341-1342. Nothing in the Federal Circuit's rationale would prevent the Department of Commerce from taking WTO rulings that construe the Uruguay Round Antidumping Agreement into account in interpreting Section 1677(35)(A).
11 The other court of appeals decision on which petitioners rely, Mississippi Poultry Ass'n v. Madigan, 992 F.2d 1359 (5th Cir. 1993), has also been vacated by a grant of rehearing en banc, 9 F.3d 1116 (1993), and replaced by an en banc decision of the Fifth Circuit that makes no reference to the Charming Betsy canon of construction, 31 F.3d 293 (1994). See Fifth Circuit Rule 41.3 ("[u]nless otherwise expressly provided, the granting of a rehearing en banc vacates the panel opinion").