992 F.Supp.2d 1346 (CIT 2014), 09-00151, Ford Motor Co. v. United States

Docket Nº:09-00151
Citation:992 F.Supp.2d 1346
Opinion Judge:Barnett, Judge:
Party Name:FORD MOTOR COMPANY, Plaintiff, v. UNITED STATES, Defendant
Attorney:No. 09-00151 Matthew W. Caligur and C. Thomas Kruse, Baker & Hostetler, LLP, of Houston, TX, for Plaintiff. Of counsel on the briefs was Paulsen K. Vandevert, Ford Motor Company, of Dearborn, MI. Barbara S. Williams, Attorney-in-Charge, and Justin R. Miller, Trial Attorney, International Trade Fi...
Judge Panel:Before: Mark A. Barnett, Judge.
Case Date:June 17, 2014
Court:Court of International Trade

Page 1346

992 F.Supp.2d 1346 (CIT 2014)

FORD MOTOR COMPANY, Plaintiff,

v.

UNITED STATES, Defendant

No. 09-00151

United States Court of International Trade

June 17, 2014

Page 1347

Matthew W. Caligur and C. Thomas Kruse, Baker & Hostetler, LLP, of Houston, TX, for Plaintiff. Of counsel on the briefs was Paulsen K. Vandevert, Ford Motor Company, of Dearborn, MI.

Barbara S. Williams, Attorney-in-Charge, and Justin R. Miller, Trial Attorney, International Trade Field Office, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of New York, NY, and Tara K. Hogan, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, D.C., for Defendant. With them on the briefs were Stuart F. Delery, Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel on the brief was Yelena Slepak, Office of the Assistant Chief Counsel, International Trade Litigation, U.S. Customs and Border Protection of New York, NY.

Before: Mark A. Barnett, Judge.

OPINION

Page 1348

OPINION & ORDER

Barnett, Judge:

Defendant, United States, moves, pursuant to USCIT Rule 12(b)(1) and the Declaratory Judgment Act, 28 U.S.C. § 2201, to dismiss Plaintiff's, Ford Motor Company, Second Amended Complaint or, in the alternative, for judgment on the agency record pursuant to USCIT Rule 56.1. (Mem. in Supp. Def.'s Mot. Dismiss, & in the Alternative, Def.'s Mot. J. A.R. (" Def.'s Mot." ) 1.) Plaintiff opposes Defendant's motion and moves the court to grant judgment on the agency record in its favor. (Ford's Am. Resp. in Opp'n Def.'s Mot. J. A.R. & Mot. Dismiss (" Pl.'s Resp." ) 5-10.) For the reasons provided below, the court grants Defendant's motion to dismiss.

Background and Procedural History

A. General Background

In 2004 and 2005, Plaintiff imported motor vehicles from the United Kingdom into the United States. (2d Am. Compl. ¶ 18.) It deposited estimated duties for each entry using the information available to it at that time, flagged each entry for reconciliation,1 and filed reconciliation entries, in

Page 1349

which Plaintiff claimed that it had overpaid duties owed. (2d Am. Compl. ¶ ¶ 19-20, Ex. A.) Plaintiff brings this action for a declaratory judgment that nine of its reconciliation entries (the " subject entries" ) were deemed liquidated by operation of law, entitling Plaintiff to duty refunds. (2d Am. Compl. 1-2.)

Pursuant to 19 U.S.C. § 1504(a), a reconciliation entry not liquidated within one year of its date of filing " shall be deemed liquidated at the rate of duty, value, quantity, and amount of duties asserted by the importer of record," absent an extension under subsection (b) of the statute or suspension as required by statute or court order. 19 U.S.C. § 1504(a)(1). U.S. Customs and Border Protection (" Customs" ) may extend the period to liquidate an entry three times, for a length of one year each time, if one of the following conditions is met:

the information needed for the proper appraisement or classification of the imported or withdrawn merchandise, or for determining the correct drawback amount, or for ensuring compliance with applicable law, is not available to the Customs Service; or

the importer of record or drawback claimant, as the case may be, requests such extension and shows good cause therefor. The Secretary shall give notice of an extension under this subsection to the importer of record or drawback claimant, as the case may be, and the surety of such importer of record or drawback claimant. Notice shall be in such form and manner (which may include electronic transmittal) as the Secretary shall by regulation prescribe. Any entry the liquidation of which is extended under this subsection shall be treated as having been liquidated at the rate of duty, value, quantity, and amount of duty asserted by the importer of record, or the drawback amount asserted by the drawback claimant, at the expiration of 4 years from the applicable date specified in subsection (a) of this section.

19 U.S.C. § 1504(b); accord 19 C.F.R. § 159.12(a)(1), (d), (e).2 If Customs extends the period for liquidation, it " shall give notice of an extension" to the importer of record and its surety in a manner prescribed by regulation. 19 U.S.C. § 1504(b); see 19 C.F.R. § 159.12(b) (" If the port director extends the time for liquidation,

Page 1350

. . . he promptly will notify the importer or the consignee and his agent and surety on CBP Form 4333-A, appropriately modified, that the time has been extended and the reasons for doing so." ). Customs must treat a reconciliation entry extended under this provision that has not been liquidated as of four years after its filing date " as having been liquidated at the rate of duty, value, quantity, and amount of duty asserted by the importer of record." 19 U.S.C. § 1504(b); accord 19 C.F.R. § 159.12(f).3

The following chart lists each subject entry, its filing date, the date upon which deemed liquidation would have occurred if Customs had extended the liquidation period a maximum of three times under 19 U.S.C. § 1504(b), and the date on which Customs liquidated and, if applicable, reliquidated the entries:

Entry Filing Date Deemed Liquidation Date Under § 1504(b) Liquidation Date Reliquidation Date
B 6/29/2005 6/29/2009 6/19/2009 8/7/2009
C 7/28/2005 7/28/2009 7/17/2009 7/31/2009
D 8/26/2005 8/26/2009 8/14/2009 9/18/2009
E 5/15/2006 5/15/2010 5/7/2010
F 6/15/2006 6/15/2010 6/4/2010 7/23/2010
G 8/14/2006 8/14/2010 7/30/2010
H 8/14/2006 8/14/2010 7/30/2010
I 9/21/2006 9/21/2010 7/30/2010
J 10/4/2006 10/4/2010 7/30/2010

(See 2d Am. Compl. ¶ ¶ 29-34, Ex. A; Def.'s Mot. 4 n.4, Ex. A; Def.'s First Mot. Dismiss Ex. B, ECF No. 27; Pl.'s TRO/Prelim. Inj. Mot. 2, ECF No. 36; Def.'s Opp'n Pl.'s TRO/Prelim. Inj. Mot. 5, ECF No. 37). B. The Present Suit and Plaintiff's Second Amended Complaint Plaintiff filed suit on April 15, 2009, invoking this court's subject matter jurisdiction pursuant to 28 U.S.C § 1581(i). ( See Summons, ECF No. 1; 2d Am. Compl. ¶ 6.) Plaintiff filed its Second Amended Complaint on August 18, 2009. ( See generally 2d Am. Compl.) As of the date that Plaintiff commenced this action, Customs had not liquidated any of the subject entries. (2d Am. Compl. ¶ 67.) During the pendency of the case, however, Customs liquidated, and in some cases reliquidated, the subject entries. Presently before the court are six claims, which broadly challenge Customs' liquidations of the subject entries and ask the court to declare, inter alia, the subject entries deemed liquidated one year after filing according to the terms set forth in their reconciliation documents. In the first cause of action, Plaintiff asks the court to declare the subject entries deemed liquidated one year after filing because, according to Plaintiff, Customs did not extend their liquidation.4 (2d Am. Page 1351 Compl. ¶ ¶ 67-69.) In this count, as well as counts two through five, see infra, Plaintiff also requests that the court declare the " Internal Advice" issued with respect to Entry C moot or " null, void, and without any legal effect or precedential value or authority." (2d Am. Compl. ¶ ¶ 70, 75, 80, 87, 94.) In its second cause of action, Plaintiff, assuming that Customs extended the subject entries' liquidation, asserts that Customs did not issue extension notices, as required by 19 U.S.C. § 1504(b) and (c). Plaintiff asks the court to declare that Customs' failure to issue notices nullified the extensions and rendered the subject entries deemed liquidated one year after filing. (2d Am. Compl. ¶ ¶ 72-74.) Plaintiff's third cause of action argues that, assuming Customs issued extension notices, the notices did not contain reasons for extension, as mandated by 19 U.S.C. § 1504(b) and (c). According to Plaintiff, this error nullified the extensions and rendered the subject entries deemed liquidated one year after filing. (2d Am. Compl. ¶ ¶ 77-79.) In its fourth cause of action, Plaintiff notes that Customs ostensibly extended the liquidation of the subject entries because it needed additional information from Plaintiff to properly appraise the entries or to ensure compliance with the law. However, Plaintiff asserts that because Customs did not ask it for additional information until June 25, 2009, the court must presume that Customs had the information it needed to properly appraise and liquidate the entries. Therefore, Customs had no valid reason to extend the subject entries' liquidation, and the court should declare that they were deemed liquidated one year after filing. (2d Am. Compl. ¶ ¶ 82-86.) Plaintiff's fifth cause of action alleges that Customs' respective August 7 and July 31, 2009 reliquidations of Entries B and C were invalid because the entries were deemed liquidated prior to those dates. Moreover, Plaintiff reasons that even if Customs properly extended the entries' liquidation for the four-year maximum permitted by statute, see 19 U.S.C. § 1504(b), Customs could not lawfully reliquidate the entries more than four years after their filing date. (2d Am. Compl. ¶ ¶ 89-93.) Plaintiff's sixth cause of action concerns only Entry D. Plaintiff filed the entry on August 26, 2005, and Customs issued to...

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