Rhone Poulenc, Inc. v. U.S.

• Decision Date: 14 July 1989
• Citation: 880 F.2d 401
• Parties: RHONE POULENC, INC., Plaintiff-Appellant, v. The UNITED STATES, Defendant-Appellee. 88-1602.
• Court: U.S. Court of Appeals — Federal Circuit

Page 401

880 F.2d 401

11 ITRD 1337

RHONE POULENC, INC., Plaintiff-Appellant, v. The UNITED STATES, Defendant-Appellee.

88-1602.

United States Court of Appeals Federal Circuit.

July 14, 1989.

James A. Geraghty, of Donohue and Donohue, New York City, argued for plaintiff-appellant.

Joseph I. Liebman, of the Intern. Trade Field Office, New York City, argued for defendant-appellee. With him on the brief were John R. Bolton, Asst. Atty. Gen., David M. Cohen, Director, and Mark S. Sochaczewsky, of the Civil Div., Dept. of Justice.

Before MARKEY, Chief Judge, SKELTON, Senior Circuit Judge, and NIES, Circuit Judge.

MARKEY, Chief Judge.

Rhone Poulenc, Inc. (Rhone), appeals from a denial of its motion to vacate an order dismissing 12 actions then on the trial court's suspension disposition calendar. Rhone Poulenc, Inc. v. United States, 694 F.Supp. 1579 (Ct. Int'l Trade 1988). The trial court held that it lacked "jurisdiction" to grant the motion. We reverse and remand. ¹

Background

The involved civil actions had been suspended pending the final disposition of Rhone Poulenc, Inc. v. United States, 11 CIT ---, Slip Op. 87-75, 1987 WL 13266 (June 26, 1987). In that "test" case, the trial court agreed with Rhone that synthetic silica was classifiable duty-free under item 523.11 TSUS. When that decision became final, the involved actions were transferred to the "suspension disposition calendar." By notice dated October 29, 1987, the clerk of the court set April 30, 1988 as the suspense date for removal from that calendar. That date was 8 months after the test case decision, rather than the 18 months permitted by the court's rule. The parties actively pursued the customary process of preparing stipulated judgments for the suspended actions. Because the actions were not removed from the calendar by the suspense date, they were dismissed by the clerk on May 6, 1988. ² On June 8, 1988, 33 days after the dismissal orders were entered, Rhone moved under court rule 60(b)(1) to vacate the dismissals and restore the actions to the suspension disposition calendar.

The trial court concluded that if it had power to grant equitable relief under court

Rule 60(b), it would "find [Rhone] has an appropriate basis to set aside the dismissal orders," and that "[t]he interests of justice strongly support settlement between the parties," citing W.R. Filbin & Co. v. United States, 11 CIT ---, Slip Op. 87-134, 1987 WL 27607 (Dec. 9, 1987). 694 F.Supp. at 1583. The court held, however, that it could not grant Rhone's motion because the United States Court of Customs and Patent Appeals (CCPA) had held in United States v. Torch Manufacturing Co., Inc., 509 F.2d 1187 (CCPA 1975) that the predecessor United States Customs Court lacked jurisdiction to do so. 694 F.Supp. at 1583.

Issue

Whether the Court of International Trade has power to grant Rhone's motion.

OPINION

Introduction

With this case, the United States Court of International Trade passes another milestone in its march toward full maturity within the federal judiciary. It is a national court under Article III of the Constitution, having evolved from the Board of General Appraisers and the Customs Court. With nationwide geographic jurisdiction, its members have traditionally been appointed from the various States and have held court at places throughout the nation. Its Chief Judge sits as a member of the Judicial Conference of the United States and its members serve on committees of that Conference. Under designation by the Chief Justice, its members sit on the federal district and appellate courts. In the Customs Courts Act of 1980, Pub.L. 96-417, 94 Stat. 1727 (Oct. 10, 1980) (Act), Congress advanced the maturing process when it granted the court "all the powers in law and equity of, or as conferred by statute upon, a district court of the United States." 28 U.S.C. Sec. 1585 (1982). The legislative history contains the statement that the Act "perfects the status" of the court "by providing it with all the necessary remedial powers in law and equity possessed by other federal courts established under Article III of the Constitution." H.R.Rep. No. 96-1235, 96th Cong., 2d Sess. 18-20 (1980), reprinted in 1980 U.S.Code Cong. & Admin.News 3729-3731. We hold here that that grant and that statement mean precisely what they say.

Jurisdiction

At the heart of this case lies an indiscriminate use of the naked term "jurisdiction." Use of that term unmodified has frequently provided fertile ground for the growth of obfuscation. Assuming the presence of a constitutionally required case or controversy, federal court jurisdiction comes in many shapes and sizes; hence understanding frequently requires an adjectival modifier. There are significant distinctions, for example, between subject matter jurisdiction, in personam jurisdiction, in rem jurisdiction, geographic jurisdiction, diversity jurisdiction, and pendent jurisdiction. Similarly, a distinction is required between the question of whether a court has subject matter jurisdiction as defined by Congress and the question of whether a plaintiff has failed to state a claim or lacks standing to invoke that jurisdiction. A further distinction exists between a court's subject matter jurisdiction and its inherent powers, i.e., those incidental powers necessary and proper to an exercise of that jurisdiction. Lastly, and most important for our purposes here, there is a fundamental distinction between a court's subject matter jurisdiction and its equitable powers. The former must exist before the latter may be exercised. The former concerns the authority of a court to hear and decide, given the subject matter of the case; the latter concerns the remedial relief a court having that authority may grant.

Failure to recognize the last-named distinction is illustrated by the trial court's use throughout its analysis, and by the government's use throughout its brief here, of only the naked term "jurisdiction". The distinction is blurred also by the use in some quarters of the mongrelized phrase "equity jurisdiction". In an effort to diffuse the potential for confusion, the Court of International Trade (Re, C.J.) said this in American Air Parcel Forwarding Co. v. U.S., 515 F.Supp. 47, 51 (Ct. Int'l Trade 1981):

Jurisdiction, the power to decide a case presented for adjudication, should not be confused with a court's so-called "equity jurisdiction". When a court has jurisdiction over the subject matter and the parties, it has the power to decide the case, and "equity jurisdiction" can only refer to its authority and discretion to grant equitable relief. The words refer to those types or classes of cases formerly heard by courts of equity, as distinguished from the ordinary courts of law. In view of the merger of law and equity, the courts may grant any proper relief whether formerly denominated legal or equitable. Hence, to say that a court has "equity jurisdiction" is merely to say that it is authorized to exercise those equitable powers formerly devised or exercised by courts of equity. As a practical matter, it implies that a court is authorized to grant or withhold any of the equitable remedies.

It cannot be disputed that under 28 U.S.C. Sec. 1581 the trial court has subject matter jurisdiction here. It properly exercised that subject matter jurisdiction in deciding the test case, and, if the 12 actions here involved are removed from the suspension disposition calendar, it will properly exercise that same subject matter jurisdiction in disposing of them. Hence no question of that "jurisdiction" is here presented. And, because 28 U.S.C. Sec. 2646 does not apply to a court rule 60(b) motion, no question of statutory time limitation on the exercise of jurisdiction is present. The true and only question on this appeal is whether the trial court has the power to grant the equitable remedy sought by Rhone's motion.

Trial Court Analysis

Exhibiting what would in a proper case be admirable restraint and adherence to precedent, the trial court reasoned that it lacked "jurisdiction" because: (1) 28 U.S.C. Sec. 2646 (1982) ³ requires that a motion "for retrial or rehearing" be brought within 30 days of the judgment or order; (2) 28 U.S.C. Sec. 2646 is substantively identical to the provision, 28 U.S.C. Sec. 2639, held in Torch, 509 F.2d at 1187, to be jurisdictional, and (3) the trial court's Rule 60(b) ⁴ does not "independently confer jurisdiction" because "no court rule can enlarge or restrict jurisdiction." 694 F.Supp. at 1581-83. The court further reasoned that (4) relief is not available under 28 U.S.C. Sec. 1585 or 28 U.S.C. Sec. 2643(c)(1) ⁵ because "those statutes cannot independently confer jurisdiction where none otherwise exists" and no court "can exercise equitable powers where jurisdiction does not lie." 694 F.Supp. at 1583.

(1) 28 U.S.C. Sec. 2646

It is useful, always, to remain cognizant of the matter at hand. The present appeal involves no substantive law, but only the ministerial, housekeeping, docket-managing function of the trial court. When there are actions filed in relation to numerous importations of essentially the same product, one action is selected as a "test case" and tried, and the others are placed on the "suspension disposition calendar." The court is normally thereafter not involved with the "suspended" actions. As above indicated, the suspended actions are removed from the calendar by the clerk upon receipt of stipulations by the parties. ⁶ Actions not timely removed from the calendar are dismissed by the clerk. Rhone's motion under court Rule 60(b) thus sought relief from a dismissal order issued by the clerk under court rule 85(d). ⁷

Rhone's was clearly and inescapably not a motion for "retrial or rehearing". ⁸ The statute, 28 U.S.C. Sec. 2646, and court rule 59 remain intact and applicable to motions for retrial or rehearing. Neither the statute nor the rule, however, says anything whatever about "jurisdiction" or...