Newtrend USA Co., Ltd. v. United States

2025 CIT 83

• Court: United States Court of International Trade
• Decided: July 3, 2025
• Docket: 22-00347
• Status: Published

Opinion

Slip Op. No. 25-83

UNITED STATES COURT OF INTERNATIONAL TRADE

NEWTREND USA CO., LTD., STARILLE, LTD., and NUTRAWAVE CO, LTD.,

Plaintiffs,

v. Before: Stephen Alexander Vaden, Judge UNITED STATES, Court No. 1:22-cv-00347 (SAV) Defendant,

and

DEER PARK GLYCINE, LLC,

Defendant-Intervenor.

OPINION

[Affirming Customs’ finding that Plaintiffs evaded U.S. anti-dumping and countervailing duties on glycine from the People’s Republic of China.]

Dated: July 3, 2025

Carrie Bethea Connolly of Faegre Drinker Biddle & Reath LLP, Washington, DC, for Plaintiffs Newtrend USA Co., Ltd., Starille, Ltd., and Nutrawave Co., Ltd. With her on the briefs were Richard P. Ferron, Douglas J. Heffner, D. Alicia Hickok, and Wm. Randolph Rucker.

Kara M. Westercamp, Senior Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, New York, NY, for Defendant United States. With her on the briefs were Patricia M. McCarthy, Director, Franklin E. White, Assistant Director, and Brian M. Boynton, Principal Deputy Assistant Attorney General, and Jennifer L. Petelle, Attorney, Office of the Chief Counsel, U.S. Customs and Border Protection. Court No. 1:22-cv-00347 (SAV) Page 2

David M. Schwartz of Thompson Hine LLP, Washington, DC, for Defendant- Intervenor Deer Park Glycine, LLC. With him on the briefs was Kerem Bilge.

Vaden, Judge: Before the Court is the second installment in a case about

glycine of disputed origin. In 2021, Geo Specialty Chemicals, Inc. (Geo) alleged that

Newtrend USA Co., Ltd; Starille, Ltd.; and Nutrawave Co., Ltd. (collectively,

Plaintiffs) imported glycine from China without paying the required antidumping

and countervailing duties. The Plaintiffs responded that PT Newtrend Nutrition

Ingredient (PT Newtrend), a subsidiary of the China-based Newtrend Group,

manufactured the disputed glycine at a factory in Indonesia. Customs and Border

Protection (Customs) initiated an investigation under the Enforce and Protect Act

(EAPA) to determine the origin of the glycine. Customs determined that substantial

evidence showed the glycine was from China and entered the United States without

receipt of the required antidumping and countervailing duties. Plaintiffs challenged

that determination in this Court. The Court granted Customs’ Motion for a Voluntary

Remand to reconsider its decision in light of the Federal Circuit’s opinion in Royal

Brush Mfg., Inc. v. United States, 75 F.4th 1250 (Fed. Cir. 2023). Order Granting

Def.’s Mot. for Vol. Remand (Newtrend I) at 10, ECF. No. 68. On remand, Customs

accepted new evidence and arguments from both parties but maintained its position

that substantial evidence showed Plaintiffs engaged in evasion. Plaintiffs now argue

Customs’ determination is arbitrary and capricious. The Court disagrees. Customs’

Remand Determination will be SUSTAINED. Court No. 1:22-cv-00347 (SAV) Page 3

FACTUAL BACKGROUND

I. Statutory Framework

Antidumping and countervailing duties exist to protect American producers

and workers from unfairly traded imports sold into the American market. See 19

U.S.C. §§ 1671, 1673. Antidumping duties address foreign goods sold “in the United

States at less than [their] fair value.” 19 U.S.C. § 1673(1); see also Bell Supply Co.,

LLC v. United States, 888 F.3d 1222, 1225 (Fed. Cir. 2018) (“Antidumping duties …

provide relief from market distortions caused by foreign producers who sell their

merchandise in the United States for less than fair market value[.]”). Countervailing

duties address the “unfair advantage” that arises when governments “subsidize

domestic industries to benefit the production or exportation of merchandise.” Kaptan

Demir Celik Endustrisi ve Ticaret A.S. v. United States, 48 CIT __, 633 F. Supp. 3d

1276, 1278 (2023) (citing 19 U.S.C. § 1671(a)); see also Guangdong Wireking

Housewares & Hardware Co., Ltd. v. United States, 37 CIT 319, 326 (2013), aff’d, 745

F.3d 1194 (Fed. Cir. 2014) (“CVDs … address the harms caused by foreign

subsidies.”).

In 2015, Congress passed the Enforce and Protect Act (EAPA) to address

growing “evasion of antidumping [and countervailing] duties.” Royal Brush, 75 F.4th

at 1255; see also Diamond Tools Tech. LLC v. United States, 45 CIT __, 545 F. Supp.

3d 1324, 1351 (2021) (“The purpose of the EAPA was to empower the U.S.

Government and its agencies with the tools to identify proactively and thwart evasion

at earlier stages to improve enforcement of U.S. trade laws, including by ensuring Court No. 1:22-cv-00347 (SAV) Page 4

full collection of [antidumping] and [countervailing] duties and, thereby, preventing

a loss in revenue.”). EAPA established a process for determining whether “covered

merchandise was entered into the … United States through evasion.” 19 U.S.C. §

1517(c)(1)(A). As defined by the statute, “evasion” means:

[E]ntering covered merchandise into the customs territory of the United States by means of any document or electronically transmitted data or information, written or oral statement, or act that is material and false, or any omission that is material, and that results in any cash deposit or other security or any amount of applicable antidumping or countervailing duties being reduced or not being applied with respect to the merchandise.

Id. § 1517(a)(5)(A). “Covered merchandise” is merchandise that is subject to an

antidumping or countervailing duty order. Id. § 1517(a)(3). Customs has

promulgated regulations providing the requirements for filing allegations of evasion,

establishing investigation procedures, and providing for administrative review of

evasion determinations. See 19 C.F.R. § 165.0.

Customs’ Office of Trade handles evasion proceedings. See 19 U.S.C. §

4371(a)(3) (authorizing the Office of Trade to direct EAPA enforcement efforts).

EAPA requires Customs to initiate an investigation and implement interim measures

within “15 business days after receiving an allegation … [that] reasonably suggests

that covered merchandise has been entered into … the United States through

evasion.” 19 U.S.C. § 1517(b)(1). Customs must then determine whether the

allegation is true. Id. § 1517(c)(1)(A). That determination must be “based on

substantial evidence[.]” Id. Once Customs makes its initial determination, EAPA

permits an administrative appeal by either party. See id. § 1517(f)(1) (“[A] person Court No. 1:22-cv-00347 (SAV) Page 5

determined to have entered ... covered merchandise through evasion or [the]

interested party that filed [the] allegation ... may file an appeal with the

Commissioner….”). Customs’ Office of Regulations and Rulings considers the appeal

under a de novo standard of review. Id. § 1517(f)(1). Parties may then contest

Customs’ final decision in this Court. See id. § 1517(g).

II. Customs’ Initial Evasion Determination

Since March 29, 1995, Commerce has imposed antidumping and

countervailing duties on glycine from the People’s Republic of China. See

Antidumping Duty Order: Glycine from the People’s Republic of China, 60 Fed. Reg.

16,116 (Dep’t of Com. Mar. 29, 1995); Glycine from India and the People’s Republic of

China: Countervailing Duty Orders, 84 Fed. Reg. 29,173 (Dep’t of Com. Jun. 21,

2019). These duties apply to “glycine of all purity levels … and precursors of dried

crystalline glycine ….” 84 Fed. Reg. at 29,174. Glycine is “a non-essential amino

acid” that “is a white, odorless, crystalline powder with a sweet taste … widely used

as the main raw ingredient for flavoring, sweeteners, feed additives for pets, [and]

nutritional supplements ….” Pls.’ Reply to Customs’ Req. for Information at 2, ECF

No. 32. Glycine fit for human consumption is manufactured using a multi-step

process that involves different chemicals, raw materials, equipment, and labor. Final

Determination at 13, J.A. at 90,012, ECF No. 104.

Plaintiffs began receiving shipments of glycine from PT Newtrend in early

2021. Id. at 2, J.A. at 90,001. On April 30 and September 7, 2021, Geo filed

allegations with Customs claiming that Plaintiffs were “evading the [anti-dumping Court No. 1:22-cv-00347 (SAV) Page 6

and countervailing duty] orders on glycine from China.” Id. at 1, J.A. at 90,000. They

asserted that Plaintiffs imported glycine from PT Newtrend “before [PT Newtrend’s

Indonesian] factory was capable of glycine production.” Id. at 1–2, J.A. at 90,000–01.

Geo claimed it had evidence the imported glycine came from China rather than

Indonesia. Id.

Customs requested information from Plaintiffs beginning in August 2021. Id.

at 3, J.A. at 90,002. It asked for information on PT Newtrend’s Indonesian production

facility, including “an estimate of the capacity of the entire factory, [and] photos of …

equipment[.]” Id. at 5, J.A. at 90,004. Plaintiffs’ responses to these requests, as well

as research by Customs, raised doubts that the imported glycine was from the

Indonesian factory. See id. at 3–5, J.A. at 90,002–04. Every Plaintiff confirmed to

Customs that it purchased glycine from PT Newtrend, and PT Newtrend told

Customs the Chinese Newtrend Group is its owner. See id. at 5–6, J.A. at 90,004–05.

Customs found evidence suggesting that PT Newtrend began shipping glycine to the

United States before its Indonesian factory was capable of production. Id. at 3, J.A.

at 90,003. The agency also obtained evidence that Plaintiffs may have had

undisclosed financial ties with each other and with the Chinese Newtrend Group. Id.

at 5–6, J.A. at 90,004–05.

On October 26, 2021, Customs issued a notice of investigation. Id. at 4, J.A. at

90,003. It determined “there was reasonable suspicion that the importers entered

covered merchandise into … the United States through evasion, and therefore

imposed interim measures.” Id. These included suspending liquidation of certain Court No. 1:22-cv-00347 (SAV) Page 7

entries and “additional measures … necessary to protect the revenue of the United

States,” such as requiring the posting of additional bonds and cash deposits. See

Notice of Initiation of Investigation and Interim Measures at 10, J.A. at 82,539, ECF

No. 99.

Customs submitted requests for information to both the Plaintiffs and PT

Newtrend, asking them to provide further information on their “corporate

structures,” “accounting/financial practices,” “sales[,]” “supplier[s,]” and glycine

production capacity. Final Determination at 5, J.A. at 90,004, ECF No. 104. The

agency delved into PT Newtrend’s consumption of raw materials, the nature of its

workforce, and the relationship between Plaintiffs and the Newtrend Group. Id. at

6–10, J.A. 90,005–09. PT Newtrend’s responses indicated that it may have lacked

“an adequate volume” of certain raw materials needed to make glycine. Id. at 7, J.A.

at 90,006. Customs also saw “inconsistencies” in PT Newtrend’s “labor, payroll, and

attendance records” for its Indonesian factory. Id. at 8, J.A. at 90,007. The

information indicated extensive affiliations between PT Newtrend, the Plaintiffs, and

the Chinese Newtrend Group. These ties included coordination on business

transactions, overlapping personnel, and loans given on non-commercial terms. Id.

at 8–9, J.A. at 90,007–08.

From May 3 through May 6, 2022, Customs conducted an onsite verification of

PT Newtrend’s Indonesian glycine factory. Id. at 12, J.A. at 90,011. Customs

“interviewed [PT Newtrend’s] employees …, toured [PT Newtrend’s] facility to

witness glycine production, and reviewed accounting records of production and sales Court No. 1:22-cv-00347 (SAV) Page 8

… associated with imports of glycine by the [Plaintiffs].” Id. Verification revealed

“serious problems” with PT Newtrend’s factory that undermined Plaintiffs’ claim that

the facility could produce glycine. Id. Customs found that PT Newtrend lacked the

ability, raw materials, and workforce needed to carry out key steps in the glycine

production process. See id. at 12–18, J.A. at 90,011–17.

Customs accepted and considered written arguments from the parties

alongside the information it gathered during its investigation. Id. at 19, J.A. at

90,018. After responding to extensive comments from the Plaintiffs, Customs issued

its determination on July 22, 2022, finding that the Plaintiffs entered covered

merchandise into the United States without paying the proper duties. See id. at 1,

J.A. at 90,000. Its conclusion rested on two findings. Id. at 29–35, J.A. at 90,028–34.

First, “substantial evidence … demonstrates the purported Indonesian manufacturer

[PT Newtrend] could not have produced the volume of glycine it supplied the

[Plaintiffs].” Id. at 30, J.A. at 90,0029. Second, evidence “indicate[d] that the glycine

[PT Newtrend] sold the [Plaintiffs] was Chinese-origin and therefore covered by

[antidumping and countervailing duty] orders.” Id. at 34, J.A. at 90,033.

Customs’ first finding rested on an analysis of PT Newtrend’s production

process, supplies, and labor force. It found that the Indonesian factory lacked the

ability to produce glycine during the period in question because it did not have the

necessary equipment. Id. at 13–15, J.A. at 90,012–14. The factory also did not

possess the necessary amount of methanol. Id. at 30, J.A. at 90,029. PT Newtrend

needed large quantities of methanol in order to manufacture the amount of glycine Court No. 1:22-cv-00347 (SAV) Page 9

Plaintiffs purchased. Id. at 7, J.A. at 90,006. Finally, Customs found that PT

Newtrend did not have an adequate workforce to produce glycine at a large scale. Id.

at 32–33, J.A. at 90,031–32.

Customs’ second finding rested on an analysis of the connections between PT

Newtrend, the Chinese Newtrend Group, and the Plaintiffs. In Customs’ view, these

connections showed that the Chinese Newtrend Group made all the glycine Plaintiffs

purchased. Id. at 34, J.A. at 90,033. Newtrend Group’s only viable glycine production

facilities were in China. Id. Evidence in the record also showed that PT Newtrend

had access to and offered to sell Chinese-origin glycine. Id. at 34–35, J.A. at 90,033–

34.

Plaintiffs filed an administrative appeal of the agency’s initial determination

on September 1, 2022. See Customs’ Appeal Decision at 1, J.A. at 90,289, ECF No.

104. Customs affirmed its evasion finding on November 30, 2022. See id. After

conducting a de novo review of the evidence, Customs confirmed that “the record

supports a finding that [PT Newtrend] was incapable of producing glycine at the

times during which the [Plaintiffs] claim such capacity.” Id. at 11, J.A. at 90,299. It

also again concluded that “record evidence further indicates that the glycine [PT

Newtrend] sold to the [Plaintiffs] was likely of Chinese origin.” Id. at 14, J.A. at

90,302. Court No. 1:22-cv-00347 (SAV) Page 10

III. The Initial Dispute

Plaintiffs filed their Complaint challenging Customs’ evasion determination on

December 23, 2022. See Compl., ECF No. 2. Plaintiffs argued that Customs violated

their due process rights because the agency redacted alleged confidential business

information and failed to provide Plaintiffs with adequately detailed summaries of

the redacted data. See Mem. of Points and Authorities of Pls. in Support of Rule 56.2

Mot. for J. on the Agency R. (Pls.’ Br.) at 3, 29–31, ECF No. 58. The Plaintiffs also

argued that Customs failed to include in the administrative record or consider in the

final decision “exculpatory documents” that Plaintiffs provided at verification. Id. at

4.

While this case was pending, the United States Court of Appeals for the

Federal Circuit decided Royal Brush Mfg., Inc. v. United States. See 75 F.4th 1250

(Fed. Cir. 2023). There, the Federal Circuit addressed Customs’ evasion

determination on pencils from the Philippines. Royal Brush, 75 F.4th at 1255.

Customs found that Royal Brush transshipped its Chinese pencils through the

Philippines to evade antidumping duties. See id. at 1254. It made that determination

based on confidential information it withheld from Royal Brush and without

providing Royal Brush an opportunity to review and rebut the secret evidence. See

id. The Federal Circuit held that Customs “violate[d] Royal Brush’s due process

rights by failing to provide the information on which it relied ….” Id. at 1262. The

appellate court also found that Customs violated its own regulations by failing to

provide Royal Brush with an opportunity to submit rebuttal information. See id. Court No. 1:22-cv-00347 (SAV) Page 11

Plaintiffs filed a Notice of Supplemental Authority informing the Court of the

Federal Circuit’s decision. Pls.’ Notice of Suppl. Authority 1–2, ECF No. 61. All

parties agreed that a voluntary remand was appropriate to consider the implications

of Royal Brush. See Def.’s Mot. at 3–4, ECF No. 62; Pls.’ Resp. at 1, ECF No. 63; Def.-

Int.’s Reply at 1, ECF No. 65. However, they disputed the breadth of the voluntary

remand’s scope. Compare Def.’s Mot. at 1, ECF No. 62, with Pls.’ Resp. at 2, ECF No.

63. The Government requested a remand in order “reconsider or further explain its

evasion determination … relative to the treatment of confidential information.” Def.’s

Mot. at 1, ECF No. 62. The Government also asked the Court for a Protective Order

so that Plaintiffs could access the confidential information. See id. at 4–5. Plaintiffs

requested that the remand (1) “[allow] the parties … to submit new briefs … based

on the complete information disclosed under any protective order[,]” and (2) “[allow]

Plaintiffs … to place on the record additional exculpatory documents and rebuttal

factual information rebutting the verification report[.]” Pls.’ Resp. at 3–4, ECF No.

63. The Government and Geo opposed Plaintiffs’ request. See Def.’s Mot. at 1, ECF

No. 62; Def.-Int.’s Reply at 3, ECF No. 65.

The Court granted Customs’ Motion for a Voluntary Remand. Newtrend I at

10, ECF No. 68. However, it “decline[d] at this time to opine on what Royal Brush or

constitutional due process requires for the Plaintiffs’ arguments to be fully heard”

because “[a]dministrative practice generally requires the agency to present its views

first ….” Id. at 9. The Court’s Remand Order instead directed Customs to “correct

any errors required by Royal Brush” and to “consider all Plaintiffs’ due process and Court No. 1:22-cv-00347 (SAV) Page 12

evidentiary claims and either grant relief or put on the record in detail why such

relief is not required.” Id. at 10.

IV. The Remand Determination

On remand, Customs reopened the record and took steps to remedy the

procedural problems with its evasion determination. See Remand Determination at

1, 3, ECF No. 73. It required petitioner Geo to place revised public versions of its

complaint against Plaintiffs on the administrative record. Id. at 2. Customs also

provided Plaintiffs with access to the confidential business information it had

previously withheld. Both Plaintiffs and Geo received “an opportunity to submit

rebuttal information to this previously withheld … information and make

arguments.” Id.

Plaintiffs submitted information to show that PT Newtrend could have

produced the glycine in Indonesia. See id. at 7–10. The new documents included a

construction contract that called for completion of the factory and installation of all

equipment by fall 2020 and photographs purporting to document the existence of a

completed factory by October 2020. See id. at 8–9. They argued that any later-

installed equipment was not necessary to commence glycine production. See id.

Plaintiffs also offered evidence regarding the origin of the glycine they imported. See

id. at 7–8. This evidence included data from the Indonesian government showing

that PT Newtrend did not import any glycine into the country between July 2020 and

June 2022. See id. at 7. They also submitted shipping records to challenge contrary

information Geo placed on the record. See id. at 13–14. Court No. 1:22-cv-00347 (SAV) Page 13

Geo received the same chance to submit new evidence on remand. See id. at

10–13. It presented information purporting to show “trading companies in Indonesia

received significant quantities of glycine just before … [PT Newtrend] began

exporting glycine to the United States.” Id. at 10. The filing included multiple

exhibits listing both imports of Chinese glycine to Indonesia during the relevant

timeframe and imports of Chinese “amino acids” to Indonesia. Id. at 10–13. Amino

acids are a “broad basket category” in the tariff classification schedule that

“include[es] glycine[.]” Id. at 11. Geo also submitted evidence that, because of

COVID-related visa restrictions, certain PT Newtrend employees could not have

legally entered Indonesia during the time at which they claimed to be at the factory.

See id. at 14–15. It argued this information “bolsters” the conclusion that PT

Newtrend began shipping glycine to the United States before its Indonesian factory

was capable of large-scale production. Id. at 15.

Customs issued its Remand Determination on January 18, 2024, which

continued to conclude Plaintiffs entered glycine in the United States through evasion.

See id. at 34. After considering the new evidence and arguments the parties

submitted, Customs determined that PT Newtrend “did not produce all the glycine it

sold to the [Plaintiffs] during [Period of Investigation].” Id. at 32. It maintained,

“Record evidence shows that the origin of the glycine which [PT Newtrend] sold to

the [Plaintiffs] but did not produce itself is China ….” Id. Court No. 1:22-cv-00347 (SAV) Page 14

V. The Present Dispute

Plaintiffs submitted comments opposing the Remand Determination to the

Court. See Pls.’ Comments in Opposition to the Remand Results (Pls.’ Comments),

ECF No. 97. They challenge it on two grounds. First, they argue that the Remand

Determination contains a series of impermissible post hoc rationalizations, which

constitute procedural error and require another remand. See id. at 3–11. Second,

Plaintiffs claim that –– even if procedurally proper –– the Remand Determination is

unsupported by substantial evidence. See id. at 11–30.

The Government and Geo argue that Customs’ Remand Determination

complies with the Court’s order and is supported by substantial evidence. See Def.’s

Resp. in Supp. of the Remand Determination (Def.’s Resp.), ECF No. 87; Def.-Int.

Resp. in Supp. of the Remand Determination (Def.-Int. Resp.), ECF No. 91. They

contend that by reopening the record, considering new evidence, and issuing a new

remand determination, Customs complied with the procedural requirements for new

agency action. See Def.’s Resp. at 26–27, ECF No. 87; Def.-Int.’s Resp. at 20–23, ECF

No. 91. They also argue that a reasonable mind could conclude that [PT Newtrend]

shipped Chinese glycine to the United States without paying the proper duties. See

Def.’s Resp. at 27–30, ECF No. 87; Def.-Int.’s Resp. at 10–20, ECF No. 91.

The Court held Oral Argument on February 12, 2025. See Oral Arg. Tr., ECF

No. 127. Following argument, the Court asked the parties to submit letter briefs

elaborating on “whether there is substantial record evidence to support Customs’

determination that the glycine imported into the United States came from China.” Court No. 1:22-cv-00347 (SAV) Page 15

Order, ECF No. 122. Plaintiffs submitted a letter brief arguing that, even if PT

Newtrend did not produce the glycine, Customs did not cite sufficient evidence the

glycine came from China. Pls.’ Suppl. Br. at 1, ECF No. 125. Both Defendant and

Defendant-Intervenor’s briefs argued the lack of glycine production at PT Newtrend’s

Indonesia factory meant that the glycine had to come from the Chinese parent

company. Def.’s Suppl. Br. at 2 – 3, ECF No. 130; Def.-Int.’s Suppl. Br. at 1, ECF No.

128.

JURISDICTION AND STANDARD OF REVIEW

This Court has jurisdiction pursuant to 19 U.S.C. § 1517(g) and 28 U.S.C. §

1581(c). Under the Enforce and Protect Act, the reviewing court must examine

Customs’ final determination and administrative review. Id. § 1517(g) (providing for

court review of both determinations). In its review of Customs’ determinations, the

Court examines “whether any determination, finding, or conclusion is arbitrary,

capricious, an abuse of discretion, or otherwise not in accordance with law.” Id. §

1517(g)(2)(B). Agency action constitutes an abuse of discretion “where the decision is

based on an erroneous interpretation of the law, on factual findings that are not

supported by substantial evidence,1 or represents an unreasonable judgment in

weighing relevant factors.” Star Fruits S.N.C. v. United States, 393 F.3d 1277, 1281

1 Plaintiffs argued in their opening comments that Customs’ evasion determination needed

to be supported by a preponderance of the evidence rather than substantial evidence. Pls.’ Comments at 19–21, ECF No. 97. That argument runs counter to the statutory text. 19 U.S.C. § 1517(c)(1)(A) directs Customs to make an evasion determination “based on substantial evidence,” which this Court reviews under the arbitrary and capricious standard. See 19 U.S.C. § 1517(g)(2). Tellingly, Plaintiffs do not reference this argument in their reply brief and did not raise it at oral argument. See generally Pls.’ Reply Br., ECF No. 95; Or. Arg. Tr., ECF No. 127. Court No. 1:22-cv-00347 (SAV) Page 16

(Fed. Cir. 2005). Where the agency “offers insufficient reasons for treating similar

situations differently,” such actions are arbitrary. SKF USA Inc. v. United States,

263 F.3d 1369, 1382 (Fed. Cir. 2001) (quoting Transactive Corp. v. United States, 91

F.3d 232, 237 (D.C. Cir. 1996)).

When reviewing agency action, it is “the duty of the courts to determine in the

final analysis and in the exercise of their independent judgment, whether on the

whole record the evidence in a given instance is sufficiently substantial to support a

finding, conclusion, or other agency action as a matter of law.” Nippon Steel Corp. v.

United States, 458 F.3d 1345, 1351–52 (Fed. Cir. 2006) (citations omitted).

Substantial evidence “means such relevant evidence as a reasonable mind might

accept as adequate to support a conclusion.” Consol. Edison Co. v. NLRB, 305 U.S.

197, 229 (1938) (citations omitted). Additionally, “The court reviews remand

determinations for compliance with the court’s [remand] order.” Bonney Forge Corp.

v. United States, No. 1:20-cv-03837, 47 CIT __, 2023 Ct. Intl. Trade LEXIS 125 at *7

(Aug. 21, 2023) (quoting Nakornthai Strip Mill Pub. Co. Ltd. v. United States, 32 CIT

1272, 1274 (2008)).

DISCUSSION

In Newtrend I, the Court ordered Customs to comply with the Federal Circuit’s

opinion in Royal Brush. Now that Customs has given Plaintiffs access to previously

confidential information and allowed them to submit rebuttal information as they

had requested, no party disputes that Customs has complied with the Court’s remand

order. See Pls.’ Comments, ECF No. 97; Def.’s Resp., ECF No. 87; Def.-Int.’s Resp., Court No. 1:22-cv-00347 (SAV) Page 17

ECF No. 91. Plaintiffs instead argue that (1) Customs’ Remand Determination did

not comply with the requirements of Department of Homeland Security v. Regents of

the University of California, 591 U.S. 1 (2020), and (2) the Remand Determination is

unsupported by substantial evidence. The Court disagrees. The Remand

Determination is SUSTAINED.

I.

An agency has two possible paths on remand: “[It] can offer a fuller

explanation of its reasoning at the time it made the decision,” or it “can take new

agency action….” Ellwood City Forge Co. v. United States, 47 CIT __, 654 F. Supp.

3d 1268, 1277 (2023) (citing Regents, 591 U.S. at 20–21). When an agency chooses to

elaborate on its prior decision, it is “limited to the agency’s original reasons” for the

decision. Regents 591 U.S. at 21. By contrast, when an agency takes new action, it

may bolster the justification for its action with “new reasons.” Id. An agency’s

decision to take new action does not require ignoring the record as it existed before

remand. Rather, when taking new action, an agency need only reexamine the

administrative record and deal with the problem “afresh.” Fisher v. Pension Benefit

Guar. Corp., 994 F.3d 664, 670 (D.C. Cir. 2021). It “is not limited to its prior reasons

but must comply with ... procedural requirements.” Ellwood City, 47 CIT __, 654 F.

Supp. 3d at 1277 (quoting Regents, 591 U.S. at 21).

Plaintiffs argue that Customs did not take new agency action when it issued

the Remand Determination. They maintain that Customs “appears to imply … that

it is choosing to explain its original determination in greater detail.” Pls.’ Comments Court No. 1:22-cv-00347 (SAV) Page 18

at 3, ECF No. 120. In their view, Customs offers new reasons for its original

determination, making the Remand Determination an impermissible post-hoc

rationalization. See id. at 3–5. Plaintiffs take aim at Customs’ repeated statements

that it “continues to find evasion” or that new information “bolster[ed],” “support[ed],”

or did “not detract” from the original determination. Id. at 5 – 6. They also claim

that Customs attempts to give a “fuller” explanation of decisions it never explained

in the first place — violating the scope of what is possible when an agency chooses

not to take new action. Id. at 5 (citing Bonney Forge Corp. v. United States, 46 CIT

__, 560 F. Supp. 3d 1303, 1313 (2022)).

The Government and Geo respond that Customs took new agency action. See

Def.’s Resp. at 26–27, ECF No. 87; Def.-Int.’s Resp. at 20–23, ECF No. 91. The

Government notes that Plaintiffs provide no support for their contention that

agencies may not reference the existing record when making a new decision. See

Def.’s Resp. at 26–27, ECF No. 87. Geo adds that, even if Customs were limited to its

original rationale, the explanation given by Customs is not a post-hoc rationalization.

See Def.-Int.’s Resp. at 20–23, ECF No. 91.

The Court is unpersuaded by Plaintiffs’ arguments. An agency takes “new

action” whenever it chooses to “deal with the problem afresh” rather than just provide

further explanation for its original action. Regents, 591 U.S. at 20–21 (citing SEC v.

Chenery Corp., 332 U.S. 194, 201 (1947)). Here, Customs “reopen[ed] the

administrative record” and allowed the parties “to submit rebuttal information and

make arguments” regarding the evasion allegations. Remand Determination at 3–4, Court No. 1:22-cv-00347 (SAV) Page 19

34, ECF No. 73. Following “review of the entire administrative record” — including

the new information — Customs issued its Remand Determination. Id. That

Determination explained how the new information affected Customs’ view of the

evidence gathered during its original investigation. See, e.g., id. at 12–13 (explaining

that Customs now viewed information Plaintiffs submitted in the original

investigation regarding the Chinese Newtrend Group’s sales as “incomplete and

unreliable” because it was contradicted by new information from Geo).

True, the Remand Determination reached the same conclusion as Customs’

original determination. But Regents does not mandate that new agency action is

different agency action. See Regents, 591 U.S. at 21 (explaining that the Government

can take new action bolstered by new reasons but which results in the same policy

outcome). Nor does Regents require the agency to pretend the original determination

never happened. That Customs said it “continues to find evasion” does not mean that

it failed to take new action. Remand Determination at 7, ECF No. 73. New agency

action does not require the recitation of magic words and phrases. Cf. Fisher, 994

F.3d at 670 (“Although [the agency] claimed to modif[y] [its] decision by more fully

responding and providing a revised and more complete explanation, its substance

made clear that it was a new agency action.”) (internal quotation marks omitted).

Customs reopened the record, accepted new evidence, and allowed the parties to file

additional written arguments before it made its decision. By any rational definition,

the agency took new action. Because Customs properly “deal[t] with the problem

afresh,” it complied with Regents’ procedural requirements; and Plaintiffs’ arguments Court No. 1:22-cv-00347 (SAV) Page 20

to the contrary are meritless. Regents, 591 U.S. at 20–21 (citing Chenery, 332 U.S. at

201).

II.

EAPA empowers Customs to investigate if a “material and false” act or

omission causes merchandise subject to antidumping or countervailing duties to

enter the United States without the “applicable … duties … being applied[.]” 19

U.S.C. § 1517(a)(5). Although Customs’ investigation must result in a determination

“based on substantial evidence,” id. § 1517(c)(1)(A), the Court reviews the decision

under an arbitrary and capricious standard. Id. § 1517(g)(2)(B). Here, Customs

determined that Plaintiffs evaded duties on Chinese glycine by mislabeling glycine

they imported from PT Newtrend as made in Indonesia. The evasion determination

rested on two findings: That (1) PT Newtrend’s Indonesian factory could not produce

all the glycine the company shipped to the United States, and (2) at least some of PT

Newtrend’s exported glycine came from China rather than Indonesia. Plaintiffs

contend that both findings are unsupported by record evidence. They argue Customs

ignored that PT Newtrend could produce the required quantity of glycine in favor of

weaker, more circumstantial evidence. They also insist that Customs’ determination

rests on inferences, guilt by association, and speculation. The Court takes each of

these arguments in turn.

A.

The first issue is whether Customs properly found that substantial evidence

indicated PT Newtrend’s Indonesian factory could not produce the glycine it exported Court No. 1:22-cv-00347 (SAV) Page 21

to the United States. Customs visited PT Newtrend’s Indonesian facility because

Plaintiffs claim the glycine they imported into the United States was manufactured

there instead of China. See Final Determination at 3–6, J.A. at 90,003–05, ECF No.

104. If the factory could not produce the amount of glycine Plaintiffs imported, it

would support a finding of evasion.

Customs’ assessment rested on its understanding of the glycine production

process. Producing glycine “is a multi-step process that requires specific equipment,

labor, and raw materials.” Id. at 13, J.A. at 90,012. First, a volatile input chemical

has to be processed. See id. That chemical must then be mixed with other chemicals

“to create a chemical reaction that produces a liquid slurry ….” Id. The “liquid slurry

… must [next] be transferred … [and] mixed with methanol … to separate the

intermediate glycine into crystals[,]” which are removed. Id. This step in the process

is critical because the quality of glycine PT Newtrend claimed to produce requires

large quantities of methanol. See id. at 14, J.A. 90,013. Finally, activated carbon

filters the “intermediate glycine” crystals “to increase [their] purity level so that the

finished product can meet the [relevant] grade standard.” Id.

Evidence Customs’ officials gathered during their on-site verification raised

serious doubts about PT Newtrend’s ability to perform this process. Officials

witnessed personnel mishandling the volatile input chemical in such a way it

“endangered [Customs’] staff.” Id. at 13, J.A. at 90,012. The portions of the factory

that allegedly mixed chemical inputs into a liquid slurry had imprecise pH meters,

“suggest[ing] that [PT Newtrend] may not be capable of the precise pH monitoring Court No. 1:22-cv-00347 (SAV) Page 22

needed to sustain industrial-scale glycine production.” Id. Customs also requested

— on three separate days — to observe PT Newtrend use methanol to separate

intermediate glycine crystals from the liquid slurry. Id. at 14, J.A. at 90,013. Despite

these repeated requests, officials “did not witness” this stage of the manufacturing

process. Id. Finally, Customs “did not observe” the use of active carbon to filter

intermediate glycine despite again asking on three separate days. PT Newtrend

“refused” to show Customs the process. Id. at 14–15, J.A. at 90,013–14. Customs

therefore never witnessed the successful manufacturing of any quantity of glycine at

the Indonesian factory during its visit. See id. at 13–15, J.A. at 90,012–14 (outlining

that Customs “could not observe” or “did not witness” essential steps in the glycine

manufacturing process).

Verification also uncovered deficiencies in PT Newtrend’s raw material supply.

In its pre-verification investigation, Customs determined — based on PT Newtrend’s

own data — that PT Newtrend “did not purchase enough methanol to produce the

volume of glycine they claim to have produced.” Id. at 14, J.A. at 90,013. Plaintiffs

claim Customs’ calculation is flawed because it does not account for how efficiently

PT Newtrend recycles methanol. Pls.’ Comments at 25–27, ECF No. 97. However,

at verification, the “methanol distillation tower control room” contained only a

computer that “did not control anything and could neither save nor print any records.”

Final Determination at 15, J.A. at 90,014, ECF No. 104. The employees present

“could not explain … methanol recycling … and claimed to have learned their jobs in

only a few weeks.” Id. PT Newtrend showed Customs a storage tank containing Court No. 1:22-cv-00347 (SAV) Page 23

“methanol,” but Customs discovered the tank actually contained hydrochloric acid.

Id. at 14, J.A. at 90,013. Customs also reviewed PT Newtrend’s raw material and

utilities purchases and found that, for every input PT Newtrend claimed to purchase,

there were unpaid invoices dating back nearly two years that PT Newtrend could not

explain. Id.

Customs’ verification also suggested that PT Newtrend lacked the workforce

needed to operate the factory. Only a handful of PT Newtrend’s listed employees

appeared in the factory’s timekeeping system. Id. at 17, J.A. at 90,016. Employee

attendance records did not match production records, implying that workers oversaw

production steps while not at the factory. Id.; see also id. at 4, J.A. at 90,003. PT

Newtrend’s payroll records contradicted its attendance records, as PT Newtrend paid

workers for work done on days when the factory was closed. Id. at 17, J.A. at 90,016.

Further, the factory lacked any office staff. Id. PT Newtrend claimed this was

because every employee was on vacation; but when asked for the names of the

vacationing employees, their supervisor could not name one. Id. To answer the

question, the supervisor needed to phone a Newtrend Group official who did not work

in Indonesia for help. Id. More broadly, interviews with PT Newtrend’s factory

employees revealed that each could “perform one task … at one production step.” Id.

at 16, J.A. at 90,015. PT Newtrend, by contrast, claimed in papers filed with Customs

before verification that “workers have no fixed task and could perform all tasks

needed for production.” Id. Court No. 1:22-cv-00347 (SAV) Page 24

The verification evidence aligned with the written submissions Customs

received from the parties. For example, documents submitted by PT Newtrend

showed that essential equipment needed for glycine production did not arrive until

months after PT Newtrend began shipping glycine to the United States. Remand

Determination at 17, ECF No. 73. Record evidence also showed that PT Newtrend

would need to recycle methanol in a physically impossible manner to have enough for

its claimed level of production. Id. at 17–19. PT Newtrend claimed that foreign

supervisors trained its factory workers. Final Determination at 7, J.A. at 90,006,

ECF No. 104. But Customs found (1) PT Newtrend began production at a time when

COVID-19 restrictions would have prohibited them from entering Indonesia; (2) PT

Newtrend did not pay these supervisors until after it began shipping glycine to the

United States; and (3) almost none of the supervisors who supposedly trained the

Indonesian employees could speak the local language. Id. at 9–10, J.A. at 90,008;

Remand Determination at 14–15, ECF No. 73.

Customs’ view did not change on remand. Plaintiffs submitted rebuttal

information and written arguments when Customs reopened the record. Plaintiffs’

arguments largely centered on showing that the Indonesian factory was operational

by fall 2020 and that PT Newtrend purchased enough raw materials to produce its

claimed quantity of glycine. Remand Determination at 7–9, 17–18, ECF No. 73.

Customs did not find this evidence persuasive. It explained that the new evidence

either did not represent new information or was outweighed by other evidence in the

record. Id. Court No. 1:22-cv-00347 (SAV) Page 25

Plaintiffs now contend that Customs’ assessment ignored record evidence

showing PT Newtrend could produce large quantities of glycine at its Indonesian

factory. Plaintiffs point to photographs showing the factory was operational by fall

2020 as well as written records documenting it possessed an adequate labor force.

See Pls.’ Comments at 22–25, ECF No. 120. They also claim that Customs’ evasion

finding rests on miscalculations of key data such as the factory’s raw material

consumption rate. Id. at 25–28. The Government and Defendant-Intervenor

disagree. They argue that the more persuasive evidence cited by Customs

outweighed Plaintiffs’ submissions. See, e.g., Def.’s Resp. at 27–30, ECF No. 87; Def.-

Int.’s Resp. at 11–18, ECF No. 91.

This Court must uphold Customs’ determination unless it was “arbitrary or

capricious.” 19 U.S.C. § 1517(g)(2)(B). “The scope of review under the ‘arbitrary and

capricious’ standard is narrow and a court is not to substitute its judgement for that

of the agency.” State Farm, 463 U.S. at 43. Nonetheless, Customs’ decision must

have “reasonably considered the relevant issues and reasonably explained the

decision.” FCC v. Prometheus Radio Project, 592 U.S. 414, 423 (2021).

Customs’ finding easily surmounts this bar. The agency reviewed the written

evidence in the record and found numerous inconsistencies that verification only

magnified. Evidence from both Geo and PT Newtrend indicated that the Indonesian

factory was not capable of producing glycine at the levels necessary to account for the

amount Plaintiffs imported. Customs did not rely solely on written evidence. It

conducted a three-day, in-person verification where it sought to examine PT Court No. 1:22-cv-00347 (SAV) Page 26

Newtrend’s production process, raw materials, and labor. See Final Determination

at 12, J.A. 90,011, ECF No. 104. Verification not only confirmed the written evidence

but also revealed larger deficiencies in PT Newtrend’s production capacity. The

factory lacked key inputs such as methanol, had no support staff, and could not

perform crucial phases of production. Id. at 13–17, J.A. at 90,012–16.

Plaintiffs claim Customs “fail[ed] to consider” photographs showing the factory

was completed by fall 2020 as well as documents claiming the factory conducted

production runs and purchased raw materials. Pls.’ Comments at 22, ECF No. 120;

Pls.’ Reply at 8–13, ECF No. 95. Plaintiffs argue that this written evidence is so

overwhelming “[c]ommon sense says [Customs’] conclusion is wrong.” Pls.’ Reply at

13, ECF No. 95. Not so.

Customs went to the Indonesian factory to see if this documentary evidence

matched reality. It did not. Employees mishandled chemicals; important

measurement tools were missing; and workers could not demonstrate or explain

entire stages of the glycine production process. Plaintiffs ask Customs agents to

believe paperwork over their lying eyes. The law does not require such a result. See

Prometheus Radio, 592 U.S. at 423 (requiring the agency reach a “reasonable”

conclusion).

This is especially true given that verification occurred nearly eighteen months

after the factory would have needed to be operational to produce the glycine Plaintiffs

purchased. See Final Determination at 1, 12, J.A. at 90,000, 90,011, ECF No. 104.

Plaintiffs do not claim that something went wrong at the factory between fall 2020 Court No. 1:22-cv-00347 (SAV) Page 27

and the May 2022 verification. Presumably, like most factories, PT Newtrend’s

Indonesian facility became better equipped and more efficient as time passed. Cf.

Pls.’ Comments at 30, ECF No. 120 (arguing that Customs’ conclusion about PT

Newtrend’s labor force rests on evidence from a time when the factory was slowly

ramping up glycine production). Thus, Customs could properly determine that the

factory would have been even less capable of glycine production in fall 2020 than it

was in May 2022. See Oral Arg. Tr. at 42:17 – 43:5, ECF No. 127 (Ms. Westerkamp:

“[W]e’re talking, you know, we’re nearly like a year and a half [after fall 2020]. But

even at that verification, there were numerous problems.”). Its conclusion that the

factory could not have produced the imported glycine was not only supported by

substantial evidence, it was also the most rational conclusion one could draw from

the evidence.

Plaintiffs maintain PT Newtrend “put forward … payment records, sign-in

sheets, and production records that demonstrate an adequate labor force.” Pls.

Comments at 29, ECF No. 120. They would have the Court believe Customs ignored

that evidence. Far from it. Customs used much of its time during verification to

investigate the company’s workforce. Its examination revealed that PT Newtrend

paid employees for work done on days that the factory was closed, conducted

production runs with employees who had not clocked in, and only had time records

for a handful of workers. Plaintiffs’ documentary evidence, when compared to this

on-site evidence, was little more than wastepaper. Customs did not ignore Plaintiffs’

documents; the agency simply determined they did not withstand scrutiny. Court No. 1:22-cv-00347 (SAV) Page 28

Plaintiffs’ remaining two arguments are red herrings. They first claim

Customs failed to consider the factory’s efficient methanol recycling system when it

concluded PT Newtrend lacked an adequate methanol supply. Pls.’ Comments at 25–

28, ECF No. 120; Pls.’ Reply at 11–13, ECF No. 95. This argument assumes the

factory possessed, used, and recycled methanol. That is not what Customs found.

Customs officials asked to see methanol, but PT Newtrend showed it hydrochloric

acid. Final Determination at 14, J.A. at 90,014, ECF No. 104. When Customs asked

on three different days to watch the factory’s equipment use methanol to separate

glycine crystals from the liquid slurry, the company’s employees refused each request.

Id. at 14–15, J.A. at 90,013–14. Customs also asked to see the methanol recycling

system at work and found a control room full of employees who could not explain the

recycling process they supposedly oversaw. Id. at 15, J.A. at 90,014. Even if Plaintiffs

are correct that PT Newtrend purchased enough methanol to make the glycine in

question, Customs had evidence that PT Newtrend could not actually use it to make

glycine. Remand Determination at 32, J.A. 90,031, ECF No. 73 (“[T]he evidence on

the record does not support a conclusion that [PT Newtrend] purchased or consumed

a sufficient quantity of methanol.”) (emphasis added).

Plaintiffs advance a similar argument to discount Customs’ activated carbon

calculations. They assert that Customs only concluded PT Newtrend did not have

enough activated carbon because it miscalculated how much the factory needed to

use. But whether the factory purchased enough activated carbon is unimportant.

Customs asked on three different days to see PT Newtrend use activated carbon to Court No. 1:22-cv-00347 (SAV) Page 29

filter the glycine. Final Determination at 14, J.A. at 90,013–14, ECF No. 104. PT

Newtrend refused each request. Id. at 14–15, J.A. at 90,013–14. PT Newtrend

needed to show Customs it could produce glycine. Simply possessing the necessary

raw materials –– even if in adequate quantities –– is insufficient.

B.

Plaintiffs finally question Customs’ determination that PT Newtrend exported

mislabeled Chinese glycine to the United States. Because the allegedly evaded order

applies to glycine from China, Customs must not only show that PT Newtrend could

not have manufactured the glycine in Indonesia. It also must demonstrate that the

glycine PT Newtrend did sell originated in China. Plaintiffs claim PT Newtrend did

not ship any Chinese glycine to the United States. Customs concluded otherwise.

Final Determination at 34–35, J.A. at 90,033–34, ECF No. 104.

Customs’ determination rests on its conclusion that the Newtrend Group

produced the glycine. See id. at 34, J.A. at 90,033 (“All of the glycine purchased by

the importers was made by the Newtrend Group.”); Remand Determination at 32–33,

ECF No. 73. Plaintiffs told Customs that the disputed glycine was produced by PT

Newtrend in Indonesia. See Final Determination at 4–6, J.A. at 90,003–05, ECF No.

104. No party disputes “the Chinese Newtrend Group directly owns … [PT

Newtrend].” Remand Determination at 32, ECF No. 73; see also Final Determination

at 5, J.A. at 90,004, ECF No. 104 (“[PT Newtrend] told [Customs] that it is owned by

the [Newtrend] Group.”). One of the Plaintiffs, Newtrend USA, “is a wholly owned

subsidiary” of Newtrend Group. Final Determination at 34, J.A. at 90,033, ECF No. Court No. 1:22-cv-00347 (SAV) Page 30

104. Another Plaintiff, Nutrawave, is run by the son of Newtrend Group’s president.

Id. at 9, J.A. at 90,008; see also Oral Arg. Tr. at 10:13–21, ECF No. 127. Evidence

showed that Newtrend Group loaned two of the Plaintiffs — Nutrawave and Starille

— money on non-commercial terms to help them import glycine into the United

States. Newtrend Group also helped the Plaintiffs find customers for the glycine they

purchased. See id.; see also Remand Results at 32–33, ECF No. 73. In other words,

Newtrend Group’s fingerprints were on every part of the transactions at issue.

Customs reasoned, “It is unlikely that[] the Newtrend Group would provide loans …

and find customers for a competitor’s glycine.” Final Determination at 34, J.A. at

90,033, ECF No. 104.

Evidence gathered by Customs showed that, during the period of investigation,

Newtrend Group’s only active glycine factories were in China. Newtrend Group

claims to have production facilities in China, Thailand, and Indonesia. See id. The

Thai facility stopped production before the period of investigation, and sales data

revealed “Newtrend Thailand did not sell any glycine to Indonesia.” Id. Customs

also reasonably found that PT Newtrend’s Indonesian factory could not have

produced glycine in the quantities necessary to fulfill Plaintiffs’ orders. Customs thus

concluded that the only Newtrend Group facilities “that could have produced the

[disputed] glycine … are Chinese[.]” Id.

Statements from PT Newtrend’s employees supported this conclusion. Geo

hired market researchers to investigate PT Newtrend and its Indonesian factory. See

id. The researchers contacted PT Newtrend and asked to purchase glycine. See Court No. 1:22-cv-00347 (SAV) Page 31

Remand Results at 19, ECF No. 73; see also Final Determination 34–35, J.A. at

90,033–34, ECF No. 104. Rather than offering glycine from its Indonesian factory,

PT Newtrend’s owner offered to sell the researchers Chinese-made glycine. See

Remand Results at 19, ECF No. 73; see also Final Determination 34–35, J.A. at

90,033–34, ECF No. 104.

Import data further suggested that PT Newtrend had access to Chinese-origin

glycine during the period in question. The port closest to PT Newtrend’s Indonesian

factory saw an increase in Chinese glycine imports just before PT Newtrend began

shipping glycine to the United States. See Final Determination at 34, J.A. at 90,033,

ECF No. 104. Data also showed that the Chinese Newtrend Group sold large

quantities of glycine to an Indonesian trading company in the period just before PT

Newtrend began shipping glycine to the United States. See Remand Determination

at 12, ECF No. 73; Final Determination at 34, J.A. at 90,033, ECF No. 104. Plaintiffs

did not disclose these shipments when they claimed to submit “[all] sales

reconciliations” for the Newtrend Group to Customs. Remand Determination at 13,

ECF No. 73. PT Newtrend’s chemical supplier also received large quantities of

“amino acids” from China around the time PT Newtrend claims to have begun glycine

production. Id. at 12. Amino acids are a broad customs classification category that

includes, but is not limited to, glycine. See id. at 11. PT Newtrend “stated on the

record that it has imported goods … through a trading company.” Id. at 16.

The evidence Plaintiffs submitted on remand did not alter Customs’ decision.

Plaintiffs provided documents from the Indonesian government showing that PT Court No. 1:22-cv-00347 (SAV) Page 32

Newtrend did not import any glycine into the country during the relevant time period.

Id. at 7. They also attempted to discredit the reliability of the import data on which

Customs relied in its original determination. Id. at 13–14. Customs did not find the

effort persuasive. It explained that the documents from the Indonesian government

only served as evidence that PT Newtrend was not the declared importer of any

glycine. Id. at 31. It did not demonstrate that PT Newtrend never received Chinese

glycine from a third-party importer, as Customs found. Customs also explained that

the Plaintiffs’ attacks on the import data’s credibility went to discrepancies unrelated

to Customs’ conclusion. Def.’s Comments at 19, ECF No. 87; see also Remand

Determination at 12, ECF No. 73.

Plaintiffs now argue Customs ignored evidence that PT Newtrend did not

import glycine from China in favor of speculation and “guilt by association.” Pls.’

Comments at 3, 12, ECF No. 120. They point to the Indonesian government

documents confirming that, during the relevant period, PT Newtrend did not import

any glycine into Indonesia. Id. at 3. Plaintiffs also contend that Customs’ theory for

how PT Newtrend imported glycine rests on unreliable data and inferences based on

corporate affiliations alone. Id. at 12–15. Customs and Geo disagree. They again

argue that Plaintiffs’ evidence is “contradicted by other record evidence.” See, e.g.,

Def.’s Comments at 27, ECF No. 91; Remand Determination at 16, ECF No. 73

(“Nothing submitted by the [Plaintiffs] … detracts from the overwhelming record

evidence of evasion.”). Court No. 1:22-cv-00347 (SAV) Page 33

To be sustained, Customs must have reached a conclusion that “reasonably

considered the relevant issue and reasonably explained the decision.” Prometheus

Radio, 592 U.S. at 423. Customs’ determination meets this threshold. Evidence in

the record demonstrates that the Chinese-based Newtrend Group controls PT

Newtrend and at least one of the Plaintiffs, Newtrend USA. Those facts, combined

with the financial assistance Newtrend Group provided to help Starille and

Nutrawave import glycine into the United States, reasonably suggest that the glycine

at issue originated from the Newtrend Group. Because Newtrend Group only

produced a sufficient quantity of glycine in China, the disputed glycine logically

would have originated from Newtrend Group’s Chinese factories. Statements

suggesting PT Newtrend had access to Chinese glycine, coupled with import data

showing increased Chinese glycine exports to Indonesia during the period of

investigation, solidify the reasonableness of Customs’ conclusion.

Plaintiffs cite “company-specific import data from the Government of

Indonesia … show[ing] that … [PT Newtrend] did not import any glycine into

Indonesia.” Pls.’ Comments at 3, ECF No. 120. Plaintiffs refer to these documents

as prima facie evidence, but prima facie evidence creates only an “inference from

previously uncontradicted evidence.” In re Piasecki, 745 F.2d 1468, 1472 (Fed. Cir.

1984). It does not, as Plaintiffs claim, “squarely refute[]” other record evidence merely

by virtue of its existence. Pls.’ Comments at 3, ECF No. 120. Here, Customs

explained that the “trade data from the Indonesian government” did not displace the

“overwhelming record evidence of evasion.” Remand Determination at 16, ECF No. Court No. 1:22-cv-00347 (SAV) Page 34

73. This evidence of evasion included: (1) Newtrend Group’s only working glycine

factories were in China; (2) PT Newtrend’s employees claimed they could sell

customers Chinese-origin glycine, and (3) import data suggested PT Newtrend could

access Chinese glycine through other trading companies. See id. at 32–33.

Administrative law does not require an agency to fixate on one piece of evidence in

disregard of the rest of the record. See Lopez Bello v. Smith, 651 F. Supp. 3d 20, 32

(D.D.C. 2022) (holding that, under the arbitrary and capricious standard, it is

“enough that the evidence when viewed as a whole provides a sufficient basis to

understand” the agency action) (internal quotation marks omitted).

Plaintiffs’ arguments about Customs’ use of import data are similarly flawed.

First, they argue some of the data is too broad because it only demonstrates

Indonesian imports of “amino acids,” a category not limited to glycine. Pls.’ Suppl.

Br. at 5, ECF No. 125. Second, Plaintiffs assert data that identifies a product’s origin

by its port of lading is unreliable because an item’s port of lading often represents

only where it was loaded onto its final cargo ship, not where it was produced. See id.

Many goods produced in Southeast Asia have a port of lading in China because that

is where they are consolidated with other shipments before being sent across the

Pacific. Remand Determination at 11, ECF No. 73.

Customs considered both issues. It admitted that the “amino acid” import data

was broad and “merely suggestive” of evasion. Id. The agency’s determination also

referenced data showing that Indonesian companies imported shipments specifically

marked as Chinese glycine, some of which were from Newtrend Group’s Chinese Court No. 1:22-cv-00347 (SAV) Page 35

affiliates. Id. at 11–13. Customs similarly agreed that port-of-lading evidence on its

own “is not dispositive.” Id. at 11. Customs credited information Geo submitted from

a third-party vendor that uses port-of-lading evidence as part of how it tracks

aggregate import data. Id. at 11–14. Although Plaintiffs now attack that data, they

“did not place evidence on the record that bill of lading data from third-party vendors

… are unreliable.” Id. at 30. Instead, Plaintiffs submitted an advertisement from a

rival firm, which also uses port-of-lading data, attacking Geo’s vendor as an inferior

data source. Id. They did not submit alternative data to controvert the information

Geo tendered. It was not legal error for Customs to find that Geo’s data was more

probative than a rival’s advertisement unaccompanied by a contrasting dataset. See

Phoenix Metal Co. v. United States, 48 CIT __, No. 1:23-cv-00048, 2024 Ct. Intl Trade

LEXIS 69, at *11–17 (Jun. 10, 2024) (holding that Plaintiffs did not discredit

Customs’ evidence of evasion with attacks devoid of contrary evidence).

Plaintiffs also challenge Customs’ reference to the statements PT Newtrend’s

employees made to Geo’s investigator. They argue that these statements are not

probative of whether PT Newtrend evaded the orders because the investigator did

not specify a place for delivery. Pls.’ Suppl. Br. at 2, ECF No. 125. Plaintiffs suggest

the employees would not have offered to sell Chinese glycine had they known the

investigator was asking about shipments to the United States. See id. But the

evidence still demonstrates that PT Newtrend had access to Chinese glycine and was

willing to sell it even when it did not know the goods’ destination. See Def.’s Suppl.

Br. at 5–6, ECF No. 130. Court No. 1:22-cv-00347 (SAV) Page 36

The standard of review is determinative here. A court reviewing an agency’s

decision under the substantial evidence standard cannot disturb the agency’s “choice

between two fairly conflicting views, even though the court would justifiably have

made a different choice.” Universal Camera Corp., 340 U.S. at 488. Customs had

ample evidence that PT Newtrend misrepresented the capabilities of its Indonesian

factory. It also had evidence that affiliates of the Newtrend Group sold the glycine;

the Newtrend Group only produced glycine in China; and PT Newtrend was willing

and able to sell Chinese glycine. It was reasonable for Customs to find that PT

Newtrend misrepresented the glycine’s origin just as it had misrepresented its

factory’s capabilities. Under the substantial evidence standard, an agency can make

judgment calls without second-guessing from the Court. See id. It validly did so here.

CONCLUSION

Customs’ evasion finding rests on simple logic: PT Newtrend purchased

glycine from its Chinese parent company because it could not produce enough of its

own. Customs conducted an extensive in-person verification of PT Newtrend’s

Indonesian factory, which revealed it could not produce glycine at the scale PT

Newtrend and Plaintiffs claimed. Written evidence also demonstrated extensive

financial and personal ties between Plaintiffs, the Newtrend Group, and PT

Newtrend. Plaintiffs resist the obvious implication of these facts –– that PT

Newtrend acquired glycine from its parent company to fulfill Plaintiffs’ orders. They

offer no alternative explanation for how PT Newtrend acquired its glycine. See Pls.’

Suppl. Br. at 1–9, ECF No. 125. Glycine is not manna. It is the result of a multi-step Court No. 1:22-cv-00347 (SAV) Page 37

manufacturing process that needs to occur somewhere. Customs reasonably

determined that it occurred at Newtrend Group’s factories in China. Given the

standard of review, Customs’ Remand Determination is SUSTAINED.

/s/ Stephen Alexander Vaden Stephen Alexander Vaden, Judge

Dated: July 3, 2025 New York, New York