Auxin Solar pressed a U.S. Court of International Trade judge to impose duties topping 250% on products that entered the U.S. during a Biden-era tariff reprieve, telling the court during oral arguments Thursday that more than a year later the threat posed by the imports remained “existential.”
Once labeled “the most hated solar company in America” by The Wall Street Journal for spurring the investigations that led to countrywide anti-circumvention tariffs on solar imports from Cambodia, Malaysia, Thailand and Vietnam, Auxin today cast itself as yet another U.S. solar firm trying to stay afloat.
“Auxin is the only litigant who has claimed the issue is existential” the manufacturer’s attorney, James E. Ransdell of Cassidy Levy Kent, told Judge Timothy M. Reif, arguing that the balance of harms weighed in favor of his client.
Auxin is seeking to overturn a moratorium that allowed solar energy products from Southeast Asia to enter the U.S. duty-free between June 2022 and June 2024, a move ordered by President Joe Biden while the U.S. Department of Commerce was investigating allegations that producers were dodging tariffs on Chinese solar gear by finishing the goods in countries with less fraught trade relations.
The move was born out of the administration’s desire to feed consumer demand for solar energy while U.S. production came online. But it proved an “unmitigated disaster” for domestic solar, Ransdell said.
The number of bankruptcies in the U.S. solar sector started growing in the second half of 2022 after a relatively flat period and increased each month through at least October 2024, according to data compiled by warranty provider Solar Insure.
In all, approximately 20,400 entries that arrived between 2022 and 2024 appeared to qualify for the duty-free treatment, U.S. Department of Justice attorney Douglas G. Edelschick told the court. Approximately 23,600 other entries that were initially let through without paying duty deposits while the moratorium was in effect, did not qualify for the tariff waiver, he said.
If Judge Reif hands Auxin its desired outcome, all 44,000 shipments would face retroactive duties reaching 250% of their value, a rate now calculated with a presumption that solar equipment from Cambodia, Malaysia, Thailand and Vietnam is effectively produced in China.
Such a penalty would be woefully unfair to companies that responded to the president’s call to supply the U.S. solar grid and followed Commerce’s directions, said Akin Gump attorneys Matt Nicely and Daniel Witkowski on behalf of the Solar Energy Industries Association.
The defense table collectively balked Thursday at Judge Reif’s suggestion that importers should have been on notice that the tariff reprieve was likely to face legal challenges.
“This opens the door of you can’t rely on any kind of rulemaking because that rule could go away,” Witkowski said.
Hogan Lovells partner Jonathan Stoel, representing Canadian Solar (USA) Inc., focused on the “highly prejudicial” nature of the relief Auxin seeks.
Of the six administrative reviews solar importers could have joined to seek lower duties, all but one, a review of 2024 imports, is now closed.
“This is a balancing exercise,” Edelschick, the DOJ attorney, said. “Certain things cannot be unscrambled with an injunction. He asked the judge to date any eventual injunction to January 1, 2024 with those importers in mind, “to preserve their right to seek review.”
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