Ammex, Inc. v. U.S., No. 02-1498.

CourtUnited States Courts of Appeals. United States Court of Appeals for the Federal Circuit
Writing for the CourtGajarsa
Citation334 F.3d 1052
PartiesAMMEX, INC., Plaintiff-Appellant, v. UNITED STATES, Defendant-Appellee.
Docket NumberNo. 02-1498.
Decision Date01 July 2003
334 F.3d 1052
AMMEX, INC., Plaintiff-Appellant,
v.
UNITED STATES, Defendant-Appellee.
No. 02-1498.
United States Court of Appeals, Federal Circuit.
July 1, 2003.

Page 1053

Craig L. John, Dykema Gossett PLLC, of Bloomfield Hills, MI, argued for plaintiff-appellant. On the brief were Herbert C. Shelley, J. William Koegel, Jr., Alice A. Kipel, and Troy H. Cribb.

Amy M. Rubin, Attorney, Civil Division, Commercial Litigation Branch, International Trade Field Office, Department of Justice, of New York, NY, argued for defendant-appellee. With her on the brief were Robert D. McCallum, Jr., Assistant Attorney General; David M. Cohen, Director, Civil Division, Commercial Litigation Branch, Department of Justice, of Washington, DC; and John J. Mahon, Acting Attorney in Charge, International Trade Field Office. Of counsel was Beth C. Brotman, Attorney, Office of Assistant Chief Counsel, United States Customs Service, New York, NY.

Before MAYER, Chief Judge, NEWMAN, and GAJARSA, Circuit Judges.

GAJARSA, Circuit Judge.


Ammex, Inc. ("Ammex") appeals the final decision of the United States Court of International Trade denying its Motion for an Order to Show Cause Why the United States Customs Service Should Not be Held in Contempt. Ammex, Inc. v. United States, 193 F.Supp.2d 1325 (Ct. Int'l Trade 2002) ("Ammex II"). Because res judicata does not preclude the United States Customs Service ("Customs") from revoking its approval of the sale of gasoline

Page 1054

and diesel fuel on a duty and tax-free basis, we affirm.

I. BACKGROUND

Ammex operates a "sterile" U.S. Customs Class 9 bonded warehouse, commonly known as a duty-free store or duty-free sales enterprise, from which it seeks to sell gasoline and diesel fuel on a duty and tax-free basis. The designation "sterile" indicates that the physical design and operation of the facility guarantees the exportation of products sold therein. The store is located on West Lafayette Street in Detroit, Michigan, adjacent to the Ambassador Bridge connecting the United States and Canada. Customers entering Ammex's facility have necessarily proceeded beyond the "point of no return," having exited from the United States. As a duty and tax-free sales enterprise, Ammex is permitted to sell for export certain goods "duty-free" to customers who transport those goods directly to Canada after leaving Ammex's store.

In a letter dated January 24, 1994, Ammex requested approval to sell gasoline and diesel fuel on a duty and tax-free basis. On February 12, 1998, Customs denied Ammex's request because gasoline and diesel fuel are "unidentifiable fungibles." U.S. Customs Service Headquarters Ruling ("HQ") 227385 (Feb. 12, 1998). HQ 227385 reaffirmed a 1994 HQ ruling which found that activities of duty-free stores should not be extended to cover "unidentifiable fungibles," such as gasoline and diesel fuel, when sold on a retail basis. HQ 225287, 1994 WL 830665 (June 7, 1994). "[I]n both HQ 227385 and 225287, Customs accepted the requestor's assertion that the merchandise under consideration was duty-free but ... determined that such merchandise could not be sold as duty-free merchandise from a class 9 bonded warehouse." Customs Bulletin and Decisions, Vol. 35, No. 25, 295, 296 (June 1, 2001).

In Ammex, Inc. v. United States, 116 F.Supp.2d 1269 (Ct. Int'l Trade 2000) ("Ammex I"), Ammex challenged the above HQ rulings. The Court of International Trade found that "Customs acted unlawfully in prohibiting Ammex from selling duty-free gasoline and diesel fuel." Id. at 1275-76. The Court of International Trade held that Customs's decision to prohibit Ammex from selling duty-free gasoline and diesel fuel violated 19 U.S.C. § 1557(a)(1), which allows "[a]ny merchandise subject to duty, with the exception of perishable articles and explosive substances" to be entered and withdrawn for exportation from bonded warehouses such as Ammex's duty-free store. Id. The Court of International Trade accordingly entered a judgment setting aside HQ 227385 and "ORDERED ADJUDGED AND DECREED that 19 U.S.C. §§ 1555 and 1557 allow the duty-free sale of gasoline and diesel fuel from a duty-free enterprise." Id. at 1276.

On September 5, 2000, in accordance with the Court of International Trade's decision, Customs issued a letter ("September 5 letter") to Ammex granting its request to expand its "Class 9 duty[-]free warehouse operation to include the gasoline and diesel fuel tanks located at [Ammex's] facility."

On October 23, 2000, Ammex wrote to Customs seeking a letter to certify that the fuel sold at Ammex's duty-free store was exempt from taxes. Customs forwarded Ammex's request to the Internal Revenue Service ("IRS"). On January 8, 2001, the IRS issued an informational letter stating that 26 U.S.C. § 4081 of the Internal Revenue Code imposes a tax on the entry into the United States of any taxable fuel, including gasoline and diesel fuel for consumption, use, or warehousing.

Page 1055

Based on the IRS letter, Customs determined that it could not lawfully permit Ammex to sell gasoline and diesel fuel on a duty and tax-free basis. On June 1, 2001, Customs issued a notice proposing to revoke the September 5 letter. Customs Bulletin and Decisions, Vol. 35, No. 25, at 295 ("Proposed Revocation of Letter Relating to Gasoline and Diesel Fuel From a Class 9 Customs Bonded Warehouse Also Known as a Duty-free Shop"). On November 21, 2001, after a notice and comment period, Customs revoked its approval of the sale of gasoline and diesel fuel on a duty and tax-free basis, effective on January 21, 2002. Customs Bulletin and Decisions, Vol. 35, No. 47, 5 (Nov. 7, 2001) ("Revocation of Ruling Letter and Treatment Relating to Gasoline and Diesel Fuel in a Class 9 Customs Bonded Warehouse").

Subsequently, Ammex filed suit in the Court of International Trade to bar Customs's revocation under the doctrine of res judicata and to hold Customs in contempt for violating Ammex I. The Court of International Trade denied Ammex's motion to enjoin Customs from revoking Ammex's permission to sell gasoline and diesel fuel on a duty and tax-free basis and to hold Customs in contempt for violating the court's judgment in Ammex I. Ammex timely appealed, and we have jurisdiction...

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  • First Mortg. Corp. v. United States, 2019-1798
    • United States
    • United States Courts of Appeals. United States Court of Appeals for the Federal Circuit
    • June 12, 2020
    ...on the merits; and (3) the second claim is based on the same set of transactional facts as the first." Ammex, Inc. v. United States , 334 F.3d 1052, 1055 (Fed. Cir. 2003) (citing Parklane Hosiery Co. v. Shore , 439 U.S. 322, 326 n.5, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979) ). However, "somewhat......
  • Ammex, Inc. v. Dep't of Treasury, Docket No. 258901.
    • United States
    • Court of Appeal of Michigan (US)
    • January 18, 2007
    ...Nevertheless, in support of its argument that its business is not located in Michigan, Ammex relies on Ammex, Inc. v. United States, 334 F.3d 1052, 1054 (C.A.Fed., 2003), in which the court specifically stated, "Customers entering Ammex's facility have necessarily proceeded beyond the `poin......
  • Bondyopadhyay v. United States, No. 19-1831C
    • United States
    • Court of Federal Claims
    • June 23, 2020
    ...of transactional facts as the first.'" First Mortg. Corp. v. United States, 2020 WL 3108286, at *4 (quoting Ammex, Inc. v. United States, 334 F.3d 1052, 1055 (Fed. Cir. 2003) (citing Parklane Hosiery Co. v. Shore, 439 U.S. at 326 n.5)). A Judge of the United States Court of Federal Claims h......
  • Milgroom v. United States, No. 15-193C
    • United States
    • Court of Federal Claims
    • August 19, 2015
    ...in the prior case." Bowers Inv. Co., LLC v. United States, 695 F.3d 1380, 1384 (Fed. Cir. 2012) (citing Ammex, Inc. v. United States, 334 F.3d 1052, 1055 (Fed. Cir. 2003)). In addition, the United States Court of Appeals for the Federal Circuit has indicated that "[o]n procedural issues not......
  • Request a trial to view additional results
62 cases
  • First Mortg. Corp. v. United States, 2019-1798
    • United States
    • United States Courts of Appeals. United States Court of Appeals for the Federal Circuit
    • June 12, 2020
    ...on the merits; and (3) the second claim is based on the same set of transactional facts as the first." Ammex, Inc. v. United States , 334 F.3d 1052, 1055 (Fed. Cir. 2003) (citing Parklane Hosiery Co. v. Shore , 439 U.S. 322, 326 n.5, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979) ). However, "somewhat......
  • Ammex, Inc. v. Dep't of Treasury, Docket No. 258901.
    • United States
    • Court of Appeal of Michigan (US)
    • January 18, 2007
    ...Nevertheless, in support of its argument that its business is not located in Michigan, Ammex relies on Ammex, Inc. v. United States, 334 F.3d 1052, 1054 (C.A.Fed., 2003), in which the court specifically stated, "Customers entering Ammex's facility have necessarily proceeded beyond the `poin......
  • Bondyopadhyay v. United States, No. 19-1831C
    • United States
    • Court of Federal Claims
    • June 23, 2020
    ...of transactional facts as the first.'" First Mortg. Corp. v. United States, 2020 WL 3108286, at *4 (quoting Ammex, Inc. v. United States, 334 F.3d 1052, 1055 (Fed. Cir. 2003) (citing Parklane Hosiery Co. v. Shore, 439 U.S. at 326 n.5)). A Judge of the United States Court of Federal Claims h......
  • Milgroom v. United States, No. 15-193C
    • United States
    • Court of Federal Claims
    • August 19, 2015
    ...in the prior case." Bowers Inv. Co., LLC v. United States, 695 F.3d 1380, 1384 (Fed. Cir. 2012) (citing Ammex, Inc. v. United States, 334 F.3d 1052, 1055 (Fed. Cir. 2003)). In addition, the United States Court of Appeals for the Federal Circuit has indicated that "[o]n procedural issues not......
  • Request a trial to view additional results

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