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Thomas Russell

Court of Appeals nixes antidumping funds for Ashley, Ethan Allen

WASHINGTON — The U.S. Court of Appeals for the Federal Circuit has ruled that Ashley Furniture and Ethan Allen are not eligible to receive millions of dollars in duties in the wooden bedroom furniture antidumping case.

In an Aug. 19 decision, the U.S. Court of Appeals said that it did not find the companies' arguments to be persuasive. A three-judge panel voted two to one to not award the Byrd monies to Ashley or Ethan Allen.

Ashley plans to appeal the decision.

"Ashley is the largest case goods manufacturer in the United States and is responsible for more U.S. jobs than all the petitioning companies combined," said CEO Todd Wanek. "We have continually reinvested in our domestic facilities despite being unfairly discriminated against by the U.S. government. In our view, all U.S. manufacturers should be treated identically. As Americans, we do not understand how the system can be so unfair when it puts one manufacturer at a disadvantage to another simply on the basis of its speech."

Kristin Mowry, whose firm Mowry & Grimson, PLLC, represents Ashley, also expressed displeasure with the decision.

"We are disappointed in the decision but encouraged by the dissenting opinion," she said. "Ashley intends to seek reversal of this decision. Ashley did exactly the same thing as many other domestic manufacturers, with the only difference being their expression of views on the antidumping case, views that are constitutionally protected political speech. Those other companies received Byrd distributions, and so should Ashley."

For years, these companies have argued that they should be entitled to a portion of the money since they too manufacture bedroom furniture in U.S. plants.

However, under the federal Continued Dumping and Subsidy Offset Act, the Byrd Amendment provision allowed companies that supported an antidumping petition to receive the collected duties. Ashley opposed the petition and Ethan Allen took no official position. U.S. Customs and Border Protection collected and distributed the duties to the petitioners, until the Byrd Amendment's repeal effective in October 2007.

In litigation after similar cases filed by the crawfish industry, Ashley, Ethan Allen and other furniture companies, including Standard and Furniture Brands International, said this provision violated their Constitutional rights to free speech.

Ashley and the others sought their share of the duties collected while the Byrd Amendment was still in effect.

Last year, after the issue wound its way through the court system, the U.S. Court of International Trade upheld the Byrd Amendment requirement and allowed some $152 million in duties to be distributed to the petitioners. However, Ashley and Ethan Allen appealed the decision.

Had the ruling gone in its favor, Ashley would have received more than $32 million and Ethan Allen would have received more than $58 million, based on estimates of duties Customs and Border Protection held up from 2008 through 2010.

The government began collecting duties around 2005, after determining that domestic producers were injured by unfairly priced imports. These duties, which are applied to Chinese factories and paid by importers of record, are meant to level the playing field for U.S. producers competing against imported product that is often priced below materials costs, a violation of international trade laws.

Joe Dorn, an attorney representing the petitioners, declined to comment on the ruling.

Ethan Allen officials did not immediately respond to requests for comment.

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