642 F.Supp. 1170 (CIT. 1986), 86-47, Bonanza Trucking Corp. v. United States

Docket Nº:86-47.
Citation:642 F.Supp. 1170
Party Name:BONANZA TRUCKING CORPORATION, Plaintiff, v. The UNITED STATES of America et al., Defendants. Court No. 86-03-00350.
Case Date:May 01, 1986
Court:Court of International Trade
 
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Page 1170

642 F.Supp. 1170 (CIT. 1986)

BONANZA TRUCKING CORPORATION, Plaintiff,

v.

The UNITED STATES of America et al., Defendants.

Court No. 86-03-00350.

No. 86-47.

United States Court of International Trade.

May 1, 1986

Soller, Singer & Horn, Carl R. Soller, Margaret H. Sachter and William C. Shayne, New York City, for the plaintiff.

Page 1171

Richard K. Willard, Asst. Atty. Gen., Joseph I. Liebman, Atty. in Charge, Intern. Trade Field Office, Commercial Litigation Branch, and Paula N. Rubin, New York City, for the defendants.

Memorandum

AQUILINO, Judge:

The plaintiff New York corporation seeks to set aside and enjoin a decision of the defendant Commissioner of Customs to revoke its licenses to cart bonded merchandise and to operate a container station. In addition to opposing the equitable relief requested by the plaintiff, the defendants have interposed a motion for judgment on the administrative record pursuant to the CIT Rule 56.1.

Background

Bonanza Trucking Corporation's licenses 1 were issued by the Customs Service on May 29, 1969 and on August 2, 1976, respectively. The applications for both licenses had been submitted by the company's president, Angelo Ferrugia.

In or about May 1984, a multi-count indictment was returned in the United States District Court for the Eastern District of New York, charging Mr. Ferrugia with obstruction of justice, perjury and tax evasion. As of August 30, 1984, Mr. Ferrugia resigned as an officer of Bonanza, and he transferred all of his stock to his brother Salvatore. The company's counsel notified the Customs Service of this resignation and transfer of ownership in a letter dated September 12, 1984 and which transmitted copies of the corporate documents. See RD F-3. Thereafter, a jury found Mr. Ferrugia guilty of one violation of 18 U.S.C. § 1503 and of one violation of 18 U.S.C. § 1623(a). On November 8, 1984, judgment of conviction was entered, imposing fines of $5,000 and five years' probation on each count. See RD F-4.

After having apparently conducted an internal investigation of the facts and circumstances of the criminal proceeding, Customs, over the signature of its Area Director, JFK Airport Area, issued a letter to Bonanza stamped May 8, 1985 and stating:

... Pursuant to § 112.30 of the Customs Regulations (19 C.F.R. 112.30), the District (Area) Director of Customs may revoke or suspend the license of a cartman if the holder of such a license or an officer of a corporation holding such a license is convicted of a felony (19 C.F.R. 112.30(a)(5).

Accordingly, I propose to revoke your license for the following reason:

CHARGE: Violation of § 112.30(a)(5) of the Customs Regulations which provide in pertinent part for revocation if an officer of a corporation holding a cartman's license is convicted of a felony.

SPECIFICATION: On May 2, 1984, Angelo Ferrugia, the President and sole owner of Bonanza Trucking Corp., was indicted by a Federal Grand Jury on 25 counts covering perjury, obstruction of justice and tax evasion. On September 20, 1984 Angelo Ferrugia was found guilty of perjury, in violation of 18 U.S.C. 1023(a) [ sic ] and obstruction of justice in violation of 18 U.S.C. 1503. Although we received the letter of resignation of Angelo Ferrugia dated August 30, 1984, Mr. Ferrugia has continued to act as a de facto officer of Bonanza Trucking Corp. after his resignation.... RD B.

A second, similar letter was sent the same day, revoking Bonanza's license to operate the container station. See RD A. Both letters informed the company of its right to appeal.

In a letter dated May 14, 1985 [RD C], Bonanza requested a hearing pursuant to 19 C.F.R. § 19.48(b) on the revocation of its container-station license. A second letter dated May 14th [RD D] requested a hearing pursuant to 19 C.F.R. § 112.30 on the revocation of the license to cart. Both letters called for production of any documents

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supporting the allegations made in the May 8 notices of revocation.

The requests for a hearing were granted, but Customs refused to produce any documents prior thereto on the ground that

there is no requirement that the government produce evidence to support its case against the license holder. In addition, it would not be in the interest of justice for the government to voluntarily submit evidence to the license holder and not have the opportunity to make a similar request of the license holder. RD E.

The Customs District Director, St. Louis, Missouri, was appointed hearing officer, and the parties appeared before him on June 20, 1985.

At the hearing, the Service's Assistant Regional Counsel called two witnesses, namely, Anthony M. Liberta, who, as JFK Area Director, had revoked Bonanza's licenses, and the probation officer responsible for post-sentence supervision of Angelo Ferrugia. Nine exhibits were also presented by the Service, to wit, The Journal of Commerce's 1985 Transportation Telephone Tickler listing of Bonanza Trucking Corp. and correspondence with the company's office manager on that listing [RD F-1]; the licenses; the September 12, 1984 letter and enclosed corporate documents; the judgment of conviction; excerpts from the transcript of the trial of Mr. Ferrugia in the district court [RD's F-5, F-6, F-7]; and the transcript of the imposition of his sentence [RD F-8].

Bonanza's counsel at the hearing (and now before this court) was not Angelo Ferrugia's lawyer during his lengthy trial. At the hearing on June 20th, counsel, who apparently was unfamiliar with the trial transcript and who had not been afforded an opportunity to review the selected excerpts beforehand, objected to their introduction into evidence (on the ground of non-relevance). See, e.g., RD F, pp. 30-31. The objection was overruled 2, as was a similar objection to reliance on the sentencing transcript. See id. at 33. On cross-examination, Mr. Liberta indicated that, prior to his issuance of the license revocations, he had received and reviewed a report of the Customs internal investigation. See id. at 35, 45. When Bonanza's counsel requested that this document be produced, he was overruled, 3 as was his request that the witness be directed to at least name the author of the report. See id. at 41. At the end of the attempted cross-examination, the hearing officer rejected counsel's effort to reserve the right to recall Mr. Liberta in view of the inability to prepare any defense in advance. See id. at 55-56.

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