EATON, Judge.
This matter is before the court on the motion of defendant the United States, on behalf of United States Customs and Border Protection ("CBP" or "Customs"), to dismiss the complaint of plaintiff Alden Leeds Inc. ("Alden Leeds") for (1) lack of subject-matter jurisdiction or (2) failure to state a claim for which relief can be granted. The question presented is whether the court may hear plaintiff's claim even though Alden Leeds failed to protest timely the unlawful publication of a notice of
By its complaint, plaintiff asks the court to use its equitable powers to "instruct CBP to refund Alden Leeds the difference between the estimated deposits of 24.83[percent] and the final assessment duties [of 4.07 percent] calculated for Alden Leeds [following an administrative review] along with interest." Am. Compl. ¶ 21(b).
On June 24, 2005, the United States Department of Commerce ("Commerce") published an antidumping duty order for chlorinated isocyanurates ("isos") from Spain (the "subject merchandise"). Chlorinated Isocyanurates from Spain, 70 Fed. Reg. 36,562 (Dep't of Commerce June 24, 2005) (notice of antidumping duty order) (the "Order"). The Order provided that the isos exported by Aragonesas Delsa S.A. would receive an antidumping duty margin of 24.83 percent. Id. at 36,563. On July 2, 2007, Aragonesas Industrias y Energia S.A., the successor-in-interest of Aragonesas Delsa S.A. (collectively, with Aragonesas Industrias y Energia S.A., "Aragonesas"),
When its entries are subject to an antidumping duty order, an importer, such as Alden Leeds, generally makes a cash deposit of the estimated antidumping duties contained in Commerce's order. See 19 U.S.C. § 1673e(a)(3) (2006). Here, in accordance with the Order, Alden Leeds made a deposit with Customs covering the estimated duty of 24.83 percent (approximately $400,000) for its entries. Pl.'s Resp. to Def.'s Mot. to Dismiss for Lack of Jur. or, in the Alt., for Fail. to St. a Cl. ("Pl.'s Resp.") 1-2. The amount of duty owed by an importer, however, is not final until the importer's entries are liquidated.
As a result of Aragonesas's request for an administrative review, the liquidation of plaintiff's merchandise was suspended. In order to prevent the liquidation of merchandise subject to a review prior to the
On February 7, 2008, Commerce sent Message No. 8038217 to Customs, which stated that Aragonesas's isos were subject to a suspension of liquidation. Admin. R. ("AR") 13. Despite Commerce's suspension of liquidation and despite having received clear instructions from Commerce that plaintiff's entries were not to be liquidated during the pendency of the review, Customs posted a bulletin notice of liquidation on April 25, 2008 (the "Bulletin Notice"). This posting indicated that the twelve entries for which Aragonesas was the exporter and Alden Leeds was the importer
On December 30, 2008, Commerce published the final results of its review and found that the subject merchandise entered during the POR should be subject to an antidumping duty rate of 4.07 percent,
Plaintiff then brought this suit to recover the difference between the deposit rate and the rate found in the Final Results. Am. Compl. ¶ 21(b). Defendant has moved to dismiss the case pursuant to USCIT Rule 12(b)(1) by insisting that because plaintiff failed to protest the purported deemed liquidation found in the Bulletin Notice, this Court does not have subjectmatter jurisdiction to grant relief to plaintiff. Mem. in Supp. of Def.'s Mot. to Dismiss for Lack of Jur. or, in the Alt., for Fail. to St. a Cl. ("Def.'s Mem.") 5. In the alternative, defendant argues that plaintiff's complaint should be dismissed for failure to state a claim upon which relief can be granted because of the failure to protest timely the Bulletin Notice. Def.'s Mem. 11; see USCIT R. 12(b)(5). For the following reasons, defendant's motion is denied.
As the party seeking to invoke this Court's authority, Alden Leeds bears the burden of establishing subject-matter jurisdiction. Autoalliance Int'l, Inc. v. United States, 29 CIT 1082, 1088, 398 F.Supp.2d 1326, 1332 (2005) (citations omitted). "[I]t is of utmost importance that mere recitation of a basis for jurisdiction not be controlling." Hartford Fire Ins. Co. v. United States, 544 F.3d 1289, 1293 (Fed.Cir.2008) (citation omitted). Alden Leeds must then plead facts from which this Court may conclude that it has subject-matter jurisdiction with respect to each of its claims. Schick v. United States, 31 CIT 2017, 2020, 533 F.Supp.2d 1276, 1281 (2007) (citing McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178, 189, 56 S.Ct. 780, 80 L.Ed. 1135 (1936) (explaining that a plaintiff "must allege in his pleading the facts essential to show jurisdiction")).
In evaluating defendant's motion to dismiss for failure to state a claim upon which relief can be granted, this Court "must accept all well-pleaded facts as true and view them in the light most favorable to the non-moving party." United States v. Ford Motor Co., 497 F.3d 1331, 1336 (Fed.Cir.2007) (citation omitted).
Defendant asserts that because 28 U.S.C. § 1581(a) jurisdiction was available to plaintiff as an avenue for relief, it cannot
By its complaint, plaintiff asks the court to find jurisdiction under § 1581(i). Am. Compl. ¶¶ 2-3. As this Court's residual jurisdiction provision, § 1581(i) provides for the exercise of jurisdiction when relief is not available under another subsection of § 1581.
In making this argument, plaintiff asserts that, because the Bulletin Notice was posted at the customshouse while Commerce's suspension was in effect, plaintiff's entries were not, in fact, liquidated. Consequently, plaintiff maintains that there was no event for it to have protested under 19 U.S.C. § 1514(a). Pl.'s Resp. 5. As a result, plaintiff concludes that, as it could not lodge a protest, which if denied would have provided jurisdiction for a lawsuit in this Court under 28 U.S.C. § 1581(a), relief under that section was necessarily "manifestly inadequate." Pl.'s Resp. 5. Therefore, Alden Leeds urges the court to exercise its jurisdiction under § 1581(i) in order to provide the appropriate relief, i.e., the return of its money. Am. Compl. ¶¶ 2-3, 21.
Congress enacted the deemed liquidation statute, 19 U.S.C. § 1504(d), to protect importers from the uncertainties in the United States' duty assessment process. See United States v. Cherry Hill Textiles, Inc., 112 F.3d 1550, 1559 (Fed. Cir.1997). Pursuant to this provision, entries that remain unliquidated for six months are liquidated by operation of law at their entered rate. See 19 U.S.C. § 1504(d).
19 U.S.C. § 1504(d). As this subsubsection makes clear, deemed liquidation results from operation of law, and Customs makes no decision and performs no act in order to bring about a deemed liquidation.
A suspension of liquidation acts to stop liquidation, including a deemed liquidation, from occurring. Indeed, a suspension of liquidation serves an important purpose in ensuring the application of proper unfair trade duties. Thus, liquidation is suspended during an administrative review so that the entries may be liquidated at the rate determined by the review. See, e.g., Canadian Wheat Bd., 33 CIT at ___, 637 F.Supp.2d at 1334 n. 6 ("A request for an administrative review results in the continuation of the suspension of liquidation."). In order to assure that the entries will be liquidated at the finally determined rate, the suspension of liquidation is not terminated until the final results of an administrative review are published in the Federal Register. See, e.g., Int'l Trading Co. v. United States, 281 F.3d 1268, 1272 (2002) (holding that the "suspension of liquidation [is] removed when the final results of the administrative review [are] published in the Federal Register").
Defendant, however, asserts that plaintiff could not rely on the suspension of liquidation, resulting from the administrative review, to shield it from claims of erroneous or unlawful deemed liquidation. While defendant concedes that the suspension, in fact, prevented a deemed liquidation from taking place, it states that plaintiff has no avenue to relief by this lawsuit. Rather, defendant argues that plaintiff was required to protest the purported deemed liquidation that was announced in the Bulletin Notice, and only if the protest were denied could the matter be heard in this Court. According to defendant, this is the holding in Juice Farms, Inc. v. United States, 68 F.3d 1344 (Fed.Cir.1995) ("Juice Farms").
In Juice Farms, the plaintiff importer's entries were subject to a suspension of liquidation pending an antidumping review. 68 F.3d at 1345. Despite the suspension, Customs, actually liquidated the entries. Id. That is, Customs took affirmative steps to liquidate the importer's merchandise.
In Juice Farms, as this case, it was only at the conclusion of the administrative review that the plaintiff learned of the liquidation of its entries, at which point it protested and requested a refund of the excess antidumping duty deposits that it posted for its entries. Id. at 1345-46. Customs, however, denied the plaintiff's protest as untimely. Id. at 1346. The plaintiff filed suit challenging Custom's erroneous liquidations of its entries, petitioning this Court to find jurisdiction under § 1581(i). Id. at 1345. Customs sought dismissal of the suit arguing that because Juice Farms did not protest the erroneous liquidations within the time frame prescribed by statute, it had forfeited its right to bring a lawsuit under § 1581(a). Id. Having forfeited that right, Customs argued, Juice Farms could not claim that § 1581(a) jurisdiction was "manifestly inadequate" and thus could not sue using § 1581(i) jurisdiction.
While the erroneous liquidations in Juice Farms were found to be unlawful, this Court found, and the Court of Appeals for the Federal Circuit affirmed, that it was unable to order the entries to be reliquidated because a timely protest was not made by the plaintiff importer. Id. at 1346. The Federal Circuit held that judicial review under 28 U.S.C. § 1581(i) was unavailable because:
Id. (citations omitted).
Defendant's argument notwithstanding, Juice Farms is distinguishable from the instant case because that case involved actual liquidations rather than deemed liquidations. Thus, the important difference between this case and Juice Farms is that, here, Customs, by posting the Bulletin Notice, claims to have announced a deemed, and not an actual, liquidation. This difference is critical because, here, unlike in Juice Farms, no liquidation took place or could have taken place, and thus no protestable event existed for plaintiff to contest. This important distinction lies in the different authority delegated to Customs with respect to actual and deemed liquidations.
Customs has the authority to take the steps that result in an actual liquidation decision. See generally 19 U.S.C. § 1500. By way of contrast, Customs has no authority to effect a deemed liquidation, and can make no finding or determination
This being the case, Alden Leeds is correct in arguing that LG Electronics U.S.A., Inc. v. United States is instructive. 21 CIT 1421, 991 F.Supp. 668 (1997) ("LG Electronics"). In that case, LG imported color television receivers from Korea that were subject to an antidumping duty order. LG Electronics, 21 CIT at 1422, 991 F.Supp. at 670. LG deposited antidumping duties with Customs upon entry of the subject merchandise. Id. at 1422, 991 F.Supp. at 670. Plaintiff then petitioned this Court for review of Commerce's determinations. Id. at 1422, 991 F.Supp. at 670-71. Pending review, this Court issued preliminary injunctions against liquidation of the disputed entries. Id. at 1422, 991 F.Supp. at 671.
Nonetheless, during the period that liquidation was enjoined, Customs posted notices of deemed liquidation at the entered rate. Id. at 1422, 991 F.Supp. at 671. None of the purported liquidations were protested within the time frame required by statute. Id. at 1423, 991 F.Supp. at 671. LG and Commerce eventually reached a settlement that lowered the antidumping duty rates from those imposed at entry. Id. at 1423, 991 F.Supp. at 671. As a result, the preliminary injunctions against liquidation were lifted, permitting liquidation at the new rates set by Commerce. Id. at 1423, 991 F.Supp. at 671-72. Customs, however, refused to reliquidate the entries at the lower rate and the importer filed suit in this Court, invoking 28 U.S.C. § 1581(i) jurisdiction. Id. at 1423, 991 F.Supp. at 672. Customs moved for summary judgment claiming that the Court had no jurisdiction over LG's claims. Id. at 1421, 991 F.Supp. at 670. The LG Electronics Court denied Customs' motion for summary judgment and confirmed jurisdiction under § 1581(i). Id. at 1430, 991 F.Supp. at 677.
In doing so, the LG Electronics Court found that Customs' erroneous notices of deemed liquidation were invalid and of no legal consequence. Id. at 1429, 991 F.Supp. at 676.
Id. at 1429, 991 F.Supp. at 676 (citation omitted). The court further noted:
Id. at 1430, 991 F.Supp. at 676-77 (citations omitted). In LG Electronics, as here, the entries purportedly deemed liquidated were not, because "as a matter of law, no deemed liquidation . . . occurred." Id. at 1429, 991 F.Supp. at 676.
As has been seen, Customs posted the Bulletin Notice while Commerce's suspension of liquidation was in effect and after having received clear notice of the suspension of liquidation for the subject merchandise. In addition, none of the § 1504(d) preconditions necessary for a deemed liquidation to take place were met prior to the posting of the Bulletin Notice at the customshouse. Further, as this Court has made clear, "Congress intended the suspension of liquidation required during § 1675 reviews to override the `deemed liquidated' provisions of § 1504." Am. Permac, Inc. v. United States, 10 CIT 535, 543, 642 F.Supp. 1187, 1194-95 (1986). As a result, no argument can be advanced to support a claim that a deemed liquidation did, in fact, occur.
As has been noted, only "liquidation[s]" may be the subject of protests. 19 U.S.C. § 1514(a). Consequently, Customs' posting of the Bulletin Notice was a legal nullity and did not have the legal ramifications that defendant argues.
Since no protest of the Bulletin Notice was required, judicial review of its contents under § 1581(a) was unavailable. As a result, plaintiff has met the "manifestly inadequate" standard, thus triggering this Court's § 1581(i) residual jurisdiction. Miller, 824 F.2d at 963. Therefore, the court finds it has jurisdiction to hear plaintiff's claims under § 1581(i)(4).
For the same reasons that this Court has jurisdiction, plaintiff also has also stated a valid claim, notwithstanding defendant's contention that "19 U.S.C. § 1514(a) precludes any relief." Def.'s Mem. 11; see USCIT R. 12(b)(5). By claiming jurisdiction under 19 U.S.C. § 1581(i), plaintiff asserts that its cause of action arises under the Administrative Procedure Act ("APA"). 5 U.S.C. §§ 702 et seq.; see also Royal United Corp. v. United States, 34 CIT ___, ___, 714 F.Supp.2d 1307, 1314 (2010) ("It is, of course, axiomatic that this Court exercises jurisdiction pursuant to Subsection 1581(i) to adjudicate a cause of action under the APA."). Section 702 of the APA provides
Moreover, under the APA, the court has the authority to "hold unlawful and set aside agency action . . . found to be . . . arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A). Because it is apparent that the court may grant relief to plaintiff by setting the aside the Bulletin Notice, Alden Leeds has stated a claim upon which relief can be granted, and defendant's motion must fail. See Totes-Isotoner Corp. v. United States, 32 CIT ___, ___, 569 F.Supp.2d 1315, 1328 (2008) (holding, in light of the Supreme Court's pleading analysis in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), that plaintiffs must now "allege facts that could provide a showing that [they are] entitled to relief").
Here, Customs seeks to impose procedural bars to judicial review of its erroneous act. Should its efforts succeed, Customs would retain money that otherwise would be returned to Alden Leeds. Customs does not argue, nor indeed could it argue, that it is entitled to Alden Leeds's money. Indeed, in order to advance such an argument, Customs would have to contend that a deemed liquidation that could not and did not take place actually transpired. Nonetheless, premised on the notion that Alden Leeds should have monitored Customs' behavior in order to catch the agency's own mistakes, Customs seeks to avoid returning the company's funds. As has been seen, the law does not direct this result. Therefore, for the foregoing reasons, defendant's motion to dismiss is denied.
To the extent that defendant actually is advancing this argument, it is obviously a litigation position. The only way that Customs was aware that Alden Leeds had entries to liquidate was that plaintiff's customs broker had filed certain papers when the entries were made. These papers, which Customs had before it when it issued the Bulletin Notice, were supplied to the court by defendant as part of the administrative record of this case. The court, therefore, has before it twelve separate sets of documents each representing an individual entry. AR 1-12. Each set contains: 1) an Environmental Protection Agency Notice of Arrival of Pesticides and Devices; 2) a Department of the Treasury/Customs Service Entry Summary; 3) an Importer's Blanket Statement of Non-Reimbursement of Antidumping Duties; and 4) a Department of the Treasury/Customs Service Entry/Immediate Delivery Form.
An examination of these forms demonstrates that 1) Aragonesas is clearly named as the "Shipper" and Alden Leeds is clearly named as the "Importer"; 2) the antidumping duty order to which the merchandise was subject was identified; 3) the antidumping duty rate for plaintiff's entries was set forth; and 4) the entry numbers, which correspond to the entry numbers listed on the Bulletin Notice, are set out clearly.
Additionally, as requested at oral argument, defendant, on June 14, 2010, filed Message No. [[ ]]. Message No. [[ ]] renders defendant's position, advanced at oral argument, implausible.
Customs employees are, of course, familiar with the agency's own forms and their contents. Customs has produced no evidence to refute the clear conclusion that the Bulletin Notice was a simple mistake. Thus, any suggestion that Customs intended to post the Bulletin Notice of a deemed liquidation because Customs was unaware that the entries in contention were the same entries whose suspension was reaffirmed by Message No. 8038217 of February 7, 2008 is so unreasonable as to be beyond the realm of serious consideration.
