628 F.Supp. 978 (CIT. 1986), No. 85-11-01611, National Juice Products Ass'n v. United States

Docket Nº:85-11-01611.
Citation:628 F.Supp. 978
Party Name:NATIONAL JUICE PRODUCTS ASSOCIATION, et al., Plaintiffs, v. The UNITED STATES, et al., Defendants.
Case Date:January 30, 1986
Court:Court of International Trade

Page 978

628 F.Supp. 978 (CIT. 1986)



The UNITED STATES, et al., Defendants.

No. 85-11-01611.

Slip Op. 86-13.

United States Court of International Trade.

Jan. 30, 1986

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[Copyrighted Material Omitted]

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Collier, Shannon, Rill & Scott (Lauren R. Howard, Paul C. Rosenthal, Michael R. Kershow), Washington, D.C., for plaintiffs.

Richard K. Willard, Asst. Atty. Gen., Joseph I. Liebman, Atty. in Charge, International Trade Field Office, Barbara M. Epstein, Civil Div., U.S. Dept. of Justice, Washington, D.C., for defendants.



This case involves a United States Customs Service (Customs) ruling that country-of-origin marking requirements apply to frozen concentrated orange juice and reconstituted orange juice that contain imported concentrated orange juice for manufacturing. 19 U.S.C. § 1304 (1982 & West Supp.1985) (country-of-origin marking requirements); C.S.D. 85-47, 19 Cust.Bull. No. 39 at 21 (Sept. 4, 1985) (Ruling No. 728557). This ruling is being challenged by plaintiffs, the National Juice Products Association (NJPA) 1 and Citrus World, Inc., Coca-Cola Foods, a Division of the Coca-Cola Company, Lykes Pasco Packing Company, and TreeSweet Products, individually and as members of NJPA. Two motions are currently before the court. Plaintiffs have moved for a preliminary injunction to delay the implementation of Customs' ruling,

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or, in the alternative, for declaratory relief. Defendants have moved for dismissal of the case for lack of jurisdiction, and in the alternative, for judgment on the administrative record.

The controversy underlying this action began on January 16, 1985, when Customs national import specialist, Officer W.J. Springer of the New York Seaport, sent a directive to various Customs ports advising them of his opinion that orange juice products using the imported ingredient of concentrated orange juice for manufacturing (manufacturing concentrate) be marked to indicate foreign origin. Officer Springer's opinion was based on a recent Customs determination that found country-of-origin marking requirements applicable to processed honey. C.S.D. 84-112, 18 Cust.Bull. 1106 (July 2, 1984). In his directive, Officer Springer advised Customs officers at the various ports to notify importers of manufacturing concentrate of this contemplated change in policy.

On April 22, 1985, plaintiffs requested that Customs issue a binding ruling, pursuant to 19 C.F.R. § 177.2 (1985), as to the applicability of the country-of-origin marking requirements of 19 U.S.C. § 1304 to frozen concentrated orange juice and reconstituted orange juice that contain imported manufacturing concentrate. On September 4, 1985, Customs issued a ruling in response to plaintiffs' April 22 request. C.S.D. 85-47, 19 Cust.Bull. No. 39 at 21. Customs held that imported manufacturing concentrate is not substantially transformed in the process that converts the manufacturing concentrate into frozen concentrated orange juice or reconstituted orange juice. Consequently, Customs held that the country-of-origin certification requirements of 19 C.F.R. § 134.25 (1985) apply to final repacked orange juice products that contain any foreign manufacturing concentrate entered for consumption or withdrawn from warehouse on or after January 1, 1986. Specifically, the importer must certify to Customs either that the retail package will be properly marked with the country of origin or that the importer will notify the repacker of the marking requirements. All retail packages of orange juice subject to the ruling must be marked with either the country of origin of the manufacturing concentrate or the phrase "This product contains foreign concentrate from __________." If the product contains concentrate from more than one foreign country, the package must list all such countries. Id. at 28. Customs also noted that this decision overruled a 1979 ruling, C.S.D. 80-88, 14 Cust.Bull. 865 (Aug. 17, 1979) (Ruling No. 710823), which held that the reconstitution of orange juice is a substantial transformation of the frozen concentrate. C.S.D. 85-47, 19 Cust.Bull. No. 39 at 28.

In a letter dated October 21, 1985, the NJPA requested that Customs postpone the implementation date of the September 4 ruling until January 1, 1987. The NJPA based this request on the need of the domestic orange juice industry for additional time to secure packaging in compliance with Customs' ruling and to reduce existing packaging inventory. A similar request was made by the Florida Citrus Commission and the State of Florida Department of Citrus in a letter dated October 25, 1985. Customs subsequently extended the effective date of the marking ruling from January 1 to March 1, 1986. 19 Cust.Bull. No. 50 at 15 (Dec. 11, 1985).

Plaintiffs have moved for pre-importation review of the September 4 ruling, claiming that this court has jurisdiction over the matter pursuant to 28 U.S.C. § 1581(i)(4) (1982) or, in the alternative, 28 U.S.C. § 1581(h) (1982). 2 Defendant contends

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that the court lacks jurisdiction under either of those provisions.

[1][2] Defendants argue that this case has been brought prematurely and should only be reviewable following protest proceedings under 19 U.S.C. §§ 1514 and 1515 (1982 & West Supp.1985); see 28 U.S.C.§ 1581(a) (1982) (Court of International Trade jurisdiction following protest and denial). The customary and generally preferred avenue of review is the traditional protest route. In this case, however, currently plaintiffs cannot pursue section 1581(a) review. C.S.D. 85-47 will not be in effect until March 1, 1986. Therefore, plaintiffs cannot import a shipment to test the ruling at this time. In addition, under certain circumstances a plaintiff need not complete the protest procedure before bringing a civil action. One of those circumstances is when the action falls within the jurisdiction of section 1581(h). 3

The Court of Appeals for the Federal Circuit has defined the requirements for invoking this court's declaratory judgment jurisdiction: 4

(1) judicial review must be sought prior to importation of goods;

(2) review must be sought of a ruling, a refusal to issue a ruling, or a refusal to change such ruling;

(3) the ruling must relate to certain subject matter; and

(4) it must be shown that irreparable harm will occur unless judicial review is obtained prior to importation.

American Air Parcel Forwarding Co. v. United States, 718 F.2d 1546, 1551-52 (Fed.Cir.1983), cert. denied, 466 U.S. 937, 104 S.Ct. 1909, 80 L.Ed.2d 458 (1984) (cited in 718 Fifth Avenue Corp. v. United States, 7 CIT ----, Slip Op. 84-39 at 3-4 (April 13, 1984) ). Since defendant challenges jurisdiction under section 1581(h), plaintiffs have the burden of demonstrating that jurisdiction exists. 718 Fifth Avenue at 3; Lowa, Ltd. v. United States, 5 CIT 81, 83, 561 F.Supp. 441, 443 (1983), aff'd, 724 F.2d 121 (Fed.Cir.1984); United States v. Biehl & Co., 3 CIT 158, 160, 539 F.Supp. 1218, 1220 (1982).

Defendant contends that plaintiffs fail to meet two of the requirements for section 1581(h) review. First, defendant contends that C.S.D. 85-47 is not the type of ruling that can be reviewed under section 1581(h). Second, defendant argues that plaintiffs have failed to demonstrate that they will be irreparably harmed if they cannot secure section 1581(h) review.

The essence of defendant's argument regarding the type of ruling appropriate for section 1581(h) review is that C.S.D. 85-47 is insufficiently specific to be the subject of pre-importation review. The legislative history defines "ruling" as "a determination

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by the Secretary of the Treasury as to the manner in which it will treat the contemplated transaction." H.R.Rep. No. 1235, 96th Cong., 2d Sess. 46, reprinted in 1980 U.S.Code Cong. & Admin.News 3729, 3758. This court has interpreted "the legislative history as speaking to specific contemplated import transactions which contain identifiable merchandise and which will feel the impact with virtual certainty." Pagoda Trading Co. v. United States, 6 CIT 296, 577 F.Supp. 22, 24 (1983). Neither of the two cases cited by defendant in which jurisdiction was denied because the action involved an inappropriate ruling apply in this case. In Pagoda Trading the ruling involved was a "general interpretive ruling" that contained "guidelines 'set forth as an aid to Customs officers in classifying specific footwear constructed with foxing.' " Pagoda Trading, 6 CIT at ---, 577 F.Supp. at 23 (quoting 48 Fed.Reg. 22,910 (1983) ). Likewise, in American Air Parcel Forwarding Co. v. United States, section 1581(h) could not be invoked because the ruling involved was an "internal advice" ruling. 5 CIT 8, 11, 557 F.Supp. 605, 608, aff'd, 718 F.2d 1546 (Fed.Cir.1983). 5 Although not restricted to the facts of a single case, the ruling at issue is clearly distinguishable from internal advice and general interpretive rulings. See Association of Food Industries, Inc. (Pistachio Group) v. von Raab, 9 CIT ---, 624 F.Supp. 1557 (1985) (with regard to country-of-origin ruling pertaining to all imports of pistachio nuts, the court found the ruling "sufficiently related to a specific import transaction to obtain jurisdiction under [section 1581(h) ]"). Customs based its ruling here on retail orange juice products that contain either 30 or 50 percent foreign manufacturing concentrate, and which have added ingredients for flavoring purposes. Plaintiffs represented these percentages of foreign concentrate to be standard in the industry, and plaintiffs clearly intend to produce products containing these percentages of foreign concentrate from the imported concentrate referred to in the ruling. As to such products, plaintiffs will feel the...

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