Alden Leeds Inc. v. United States

Decision Date07 September 2010
Docket NumberCourt No. 09-00476.,Slip Op. 10-102.
Citation721 F.Supp.2d 1322
PartiesALDEN LEEDS INC., Plaintiff, v. UNITED STATES, Defendant.
CourtU.S. Court of International Trade

OPINION TEXT STARTS HERE

COPYRIGHT MATERIAL OMITTED.

Sokol, Behot & Fiorenzo (Joseph B. Fiorenzo), for plaintiff.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, Patricia M. McCarthy, Assistant Director, Barbara S. Williams, Attorney in Charge, International Trade Field Office, Commercial Litigation Branch, Civil Division, United States Department of Justice (Alexander Vanderweide and Arlene Pianko Groner); Office of Chief Counsel, International Trade Litigation, United States Customs and Border Protection (Edward N. Maurer), of counsel, for defendant.

Before: Richard K. Eaton, Judge.

OPINION AND ORDER

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 deemed liquidation. Defendant makes no serious argument that it has any rightful claim to plaintiff's money; rather, it insists that the court has no power to order its return.

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). 1 For the reasons set forth below, defendant's motion to dismiss is denied.

BACKGROUND

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”), 2 filed a request for an administrative review of the isos it produced and exported to the United States. See 19 C.F.R. § 351.213(b) (2009). Commerce subsequently published a notice of initiation of an administrative review of the Order for the period June 1, 2006 through May 31, 2007 (the “POR”). Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 72 Fed.Reg. 41,057, 41,057 (Dep't. of Commerce July 26, 2007). Commerce issued the final results of the review on December 30, 2008, setting the final assessment rate for the subject merchandise at 4.07 percent. See Chlorinated Isocyanurates from Spain, 73 Fed.Reg. 79,789, 79,789 (Dep't. of Commerce Dec. 30, 2008) (final results of antidumping duty administrative review) (the “Final Results”).

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. 3 The final amount on liquidation may vary from the deposit amount after Commerce completes an administrative review. See generally 19 U.S.C. § 1675; see also Consol. Bearings Co. v. United States, 348 F.3d 997, 1000 (Fed.Cir.2003).

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 final determination, the law provides for a suspension of liquidation while the review is proceeding. Canadian Wheat Bd. v. United States, 33 CIT ----, ----, 637 F.Supp.2d 1329, 1334 n. 6 (2009) (“ Canadian Wheat Bd.”).

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 4 had been liquidated by operation of law (the “purported deemed liquidation”) on January 26, 2008 under the provisions of 19 U.S.C. § 1504(d). Def.'s Reply to Pl.'s Resp. to Mot. to Dismiss for Lack of Jur. or, in the Alt., for Fail. to St. a Cl. 6 (citing AR 14).

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, 5 a substantially lower rate than the estimated deposit rate of 24.83 percent collected from Alden Leeds. Final Results, 73 Fed.Reg. at 79,789. Alden Leeds immediately sought a refund of the difference between the estimated deposit rate and the final rate determined in the review. Rather than receiving its refund, Alden Leeds was informed that the subject merchandise had been deemed liquidated at the deposit rate on January 26, 2008. Pl.'s Resp. 3-4.

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 subject-matter 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.

STANDARD OF REVIEW

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).

DISCUSSION
I. Jurisdiction Under 28 U.S.C. § 1581(i)

Defendant asserts that because 28 U.S.C. § 1581(a) jurisdiction was available to plaintiff as an avenue for relief, it cannot now bring a case under 28 U.S.C. § 1581(i). In other words, defendant insists that had Alden Leeds wished to dispute the purported deemed liquidation, it first was required to file a protest. See 19 U.S.C. § 1514(a). According to defendant, if plaintiff failed to gain relief by way of protest, it could then have petitioned this Court for relief pursuant to 28 U.S.C. § 1581(a). 6 Def.'s Mem. 7-8.

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. 7 Norcal/Crosetti Foods, Inc. v. United States, 963 F.2d 356, 359 (Fed.Cir.1992). According to plaintiff, in this case, jurisdiction under § 1581(i) is triggered because other possible remedies were “manifestly inadequate.” Miller & Co. v. United States, 824 F.2d 961, 963 (Fed.Cir.1987) (“ Miller ”).

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...

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