Ninestar Challenges Evidence, Evidentiary Standard of UFLPA Entity Listing at CIT
Chinese printer cartridge exporter Ninetsar Corp. filed its motion for judgment at the Court of International Trade on Jan. 22 against its placement on the Uyghur Forced Labor Prevention Act Entity List. Made public Jan. 31, the brief emphasizes arguments already made in support of its motion for a preliminary injunction (see 2312180057) (Ninestar Corp. v. U.S., CIT # 23-00182).
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In all, Ninestar argued that the listing decision lacks an evidentiary basis and an "adequate, reasoned explanation" and that the Forced Labor Enforcement Task Force (FLETF) went beyond its statutory authority by applying the "wrong standard of proof."
The exporter centered its evidentiary arguments on the government's claims that Ninestar cooperated with the government of the Xinjiang Uyghur Autonomous Region to receive Uyghur laborers and that Ninestar currently works with the XUAR government to receive forced labor. The U.S. said documents from the exporter itself, documents from the Chinese government and media publications support these findings.
"That is simply not true," the exporter said, arguing that the bulk of the evidence doesn't say that Ninestar "recruited Uyghur laborers from Xinjiang (or anywhere else) or worked with the XUAR government to do any of the things required for this list." The exporter said the U.S. "relies heavily" on uncorroborated and redacted reports that make these allegations, ultimately interpreting this insufficient evidence to support its "preconceived narrative."
No "credible evidence" supports the finding that Ninestar used forced labor in its supply chain, the brief said. All evidence cited by the government is redacted throughout all briefs at the trade court.
Ninestar added that FLETF imposed the wrong standard of proof in saying that it only needed "reasonable cause" to add the exporter to the UFLPA Entity List, when in fact the Administrative Procedure Act demands a higher "preponderance of the evidence" standard.
As an initial matter, Ninestar said there's a "strong presumption that a preponderance standard applies" and that departures from this standard are "rare" and are reserved for "explicit" directives to use a lower standard. The UFLPA has "no such 'explicit directive'" and should not be read to include one since Congress could have written one into the law.
In fact, the statute itself "corroborates maintaining the usual standard for agency factfinding," the brief said. The UFLPA tells the FLETF to carry out a "comprehensive description and evaluation" in adding to the list. Specifically, the UFLPA tells the task force to find if the entity is working with the XUAR government to "recruit, transport, harbor, or receive" forced labor or Uyghurs out of the XUAR. It makes sense that this directive should be understood under the traditional preponderance standard of review, the brief said.
Ninestar said the preponderance standard is also supported by the "severe consequences of listing." Being added to the UFLPA Entity List "is a massive financial blow and a reputational death knell," evidenced by the effects felt by Ninestar, the company said. Listing decision consequences are severe and are "also nearly impossible to reverse," given Congress' intended mechanism for rebutting the presumption, which is limited to individual shipments.
Once on the list, a company is presumed to have made its goods with forced labor. The presumption may be rebutted on a per-shipment basis "only if the entity can prove a negative by clear and convincing evidence." The fact that the UFLPA set such a high standard for rebutting the presumption and no delisting procedure "indicates that the listing decision in the first instance must be based on more than just some evidence or a hunch," the brief said.