La Molisana S.P.A. v. United States
Docket No. 2023-2060 (2025)
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Rule of Law:
In antidumping investigations, an administrative agency's model-match methodology must accurately compare products based on their actual physical characteristics; administrative goals like transparency and consistency cannot justify reliance on methods, such as using packaging labels, that lead to inaccurate comparisons of non-identical products in violation of statute.
Facts:
- La Molisana S.p.A. and Valdigrano Di Flavio Pagani S.r.L. are Italian companies that export pasta to the United States.
- The U.S. Department of Commerce uses a model-match methodology to determine antidumping duties, classifying pasta as 'premium' if its protein content is 12.5% or more, and 'standard' if it is less.
- The United States and Italy have different legal standards for determining and reporting protein content on food labels.
- U.S. Food and Drug Administration (FDA) regulations require that the grams of protein per serving listed on nutrition labels be rounded to the nearest whole gram.
- The U.S. and the European Union mandate the use of different nitrogen-to-protein conversion factors to calculate protein content (6.25 in the U.S. vs. 5.7 in Italy).
- These differing rounding and conversion factor rules result in physically identical pasta having different protein percentages reported on U.S. and Italian labels.
- La Molisana presented evidence arguing that these discrepancies caused its standard-quality pasta to be misclassified as premium-quality pasta.
- In a related argument, La Molisana presented a market report from a small D.C.-area survey and evidence from a single Italian grain exchange to argue the industry standard for premium pasta had shifted from 12.5% to 13.5% protein.
Procedural Posture:
- The U.S. Department of Commerce conducted its twenty-third administrative review of the antidumping order on certain Italian pasta and issued its final results, rejecting La Molisana's challenges.
- La Molisana (plaintiff) appealed Commerce's final results to the U.S. Court of International Trade, a court of first instance for such matters.
- The Court of International Trade sustained Commerce's final results, concluding they were supported by substantial evidence.
- La Molisana (plaintiff-appellant) appealed the decision of the Court of International Trade to the U.S. Court of Appeals for the Federal Circuit.
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Issue:
Does the Department of Commerce's model-match methodology, which relies on protein content as stated on pasta packaging labels, violate the statutory requirement under 19 U.S.C. § 1677(16)(A) to compare 'identical' products when differing U.S. and Italian regulations for protein rounding and calculation cause the labels to inaccurately reflect the pasta's true physical properties?
Opinions:
Majority - Stoll, Circuit Judge.
Yes, the Department of Commerce's methodology violates the statute because it fails to compare products that are identical in physical characteristics. The Tariff Act's requirement for accuracy in comparing physically identical products overrides administrative goals of transparency and consistency. Because Commerce itself designated protein content as a commercially significant physical characteristic, it cannot rely on calculation methods that admittedly produce inaccuracies and then dismiss those inaccuracies as commercially insignificant. The FDA's rounding rules and the different nitrogen-to-protein conversion factors both cause Commerce's label-based methodology to fail the statutory requirement of comparing physically identical products. However, Commerce reasonably rejected the argument to change the 12.5% breakpoint, as the evidence presented—a geographically limited market survey and a change by only one of three relevant commodity exchanges—was insufficient to demonstrate a compelling, industry-wide shift.
Analysis:
This decision reinforces the primacy of statutory accuracy over administrative convenience in trade law. It establishes that when an agency, like Commerce, designates a specific physical characteristic as the basis for comparison, it is bound to measure that characteristic accurately and cannot ignore known, systemic inaccuracies caused by differing national regulations. The ruling creates a significant precedent requiring Commerce to potentially adjust its methodologies across various industries where labeling laws or measurement standards differ between the U.S. and the exporting country, ensuring that antidumping calculations are based on substantive reality rather than labeling artifacts.
