Cottman Co. v. Dailey

• Decision Date: 04 January 1938
• Docket Number: No. 4236.,4236.
• Citation: 94 F.2d 85
• Parties: COTTMAN CO. et al. v. DAILEY, Collector of Customs.
• Court: U.S. Court of Appeals — Fourth Circuit

94 F.2d 85 (1938)

COTTMAN CO. et al. v. DAILEY, Collector of Customs.

No. 4236.

Circuit Court of Appeals, Fourth Circuit.

January 4, 1938.

Roszel C. Thomsen and William L. Marbury, Jr., both of Baltimore, Md. (Walter L. Clark, and Marbury, Gosnell & Williams, all of Baltimore, Md., on the brief), for appellants.

C. Ross McKenrick, Asst. U. S. Atty., of Baltimore, Md., and Daniel I. Auster, Sp. Atty., Customs Division, Department of Justice, of New York City (Bernard J. Flynn, U. S. Atty., of Baltimore, Md., and Joseph R. Jackson, Asst. Atty. Gen., on the brief), for appellee.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

PARKER, Circuit Judge.

This is an appeal from an order dismissing for lack of jurisdiction a suit instituted to enjoin the defendant Collector of Customs from liquidating an entry at the port of Baltimore of certain phosphate rock, and assessing thereon a special dumping duty under the Antidumping Act of 1921, 19 U.S.C.A. §§ 160-173, based upon an appraisal which had already been the subject of extended litigation in the United States Customs Court and the United States Court of Customs and Patent Appeals. The opinion of the lower court is reported in D.C., 20 F.Supp. 142.

The phosphate rock with respect to which the dumping duty was assessed was imported from Morocco in four cargoes between August 4, 1927, and February 10, 1928. Under the Tariff Act of 1922 it was free of duty; but, on February 9, 1928, the Secretary of the Treasury made a finding and proclamation with respect thereto as prescribed by the Antidumping Act of 1921. The appraiser at Baltimore thereupon proceeded to conduct an investigation and make an appraisal as provided by the act and found a foreign market value of from $7.52 to $7.58 per ton, and a purchase price of from $4 to $5 per ton. Thereupon, there was appeal to reappraisement by the importer with appeals to the Customs Court and the Court of Customs and Patent Appeals, Cottman & Co. v. United States, 20 C.C.P.A., Customs, 344, with the result that the appeal to reappraisement has been dismissed and the Collector at Baltimore, unless restrained by the courts, will proceed to liquidate the entry by assessing duties in the amount of the difference between the foreign value of the phosphate rock and its purchase price as found by the appraiser.

The plaintiffs make three contentions: (1) That the Antidumping Act is unconstitutional because involving a delegation of legislative power to the executive and as authorizing a finding of dumping without opportunity for hearing as to goods which had entered the country; (2) that the finding of dumping in this case is invalid because made under a regulation defining a sale at less than foreign market value or cost of production as being a sale at less than fair value within the meaning of the statute; and (3) that the appraisals upon which the antidumping duties will be assessed are invalid, notwithstanding the proceedings had in the Customs Court and the Court of Customs and Patent Appeals, because not based upon foreign market value, and that the Collector is, therefore, without statutory authority to proceed with the assessment of duties and liquidation of the entry. The last is their principal contention. The defendant, in addition to supporting the constitutionality of the statute and the authority of the Secretary to make the finding under the antidumping statute, takes the position that the plaintiffs have an adequate remedy at law for any grievance which they may have, that this remedy has been thoroughly tried and exhausted, and that the judge below was correct in holding that he was without jurisdiction to entertain the suit.

For an understanding of the contentions of the parties with respect to the litigation in the Customs Court and the Court of Customs and Patent Appeals, it is necessary that we briefly review that litigation, which was conducted pursuant to section 210 of the Antidumping Act of 1921, 19 U.S.C.A. § 169, providing the same right of appeal and protest to the Customs Court and the Court of Customs and Patent Appeals as is provided with respect to appeals and protests relating to customs duties under existing law, i. e., under the law as codified in 19 U.S.C.A. §§ 381 (1501), 398 (1514), 399 (1515), Tariff Act 1922, §§ 501, 514, 515, 42 Stat. 966, 969, 970, Tariff Act 1930, §§ 501, 514, 515. From the appraisal made by the appraiser at Baltimore there was an "appeal to reappraisement" to the Customs Court as provided by statute, and the case was heard by a single judge, who found the home market value of the phosphate rock in Morocco not to exceed the purchase price. This was affirmed on appeal to the Third Division of the Customs Court, composed of three judges, but was reversed on appeal to the Court of Customs and Patent Appeals because of its exclusion of certain evidence offered by the government. On the second hearing before the single judge of the Customs Court, there was another finding that the market value of the rock did not exceed the purchase price; but this was reversed on appeal to the Third Division of that court, and a judgment was entered by the Division which was crucial in the further progress of the case, and which disposes of most of the contentions which plaintiffs make before us. The concluding portion of the prevailing opinion, which sums up the decision, is as follows: "Since the evidence introduced in the cases at bar fails to establish the statutory foreign market value of the merchandise, the trial court should have weighed the evidence with a view to finding cost of production. Exhibit No. 5 is an affidavit which purports to show the cost of production of these importations. Upon inspection, we find that this exhibit fails to establish every element of cost of production as defined by section 206, quoted supra. As there is no other satisfactory evidence of statutory cost of production in the record, the appeals might well have been dismissed by the trial court, under authority of (citing cases). Under the principle stated in the cited cases, such dismissal would reinstate the dutiable value returned by the appraiser in each of these cases. We conclude, as a matter of law, that the decision of the trial court, published in Cottman v. United States, T.D. 44581, is contrary to the weight of the evidence, and is therefore reversed and the cause remanded for further proceedings consistent with our decision herein. Let judgment be entered accordingly." (Italics ours).

On appeal to the Court of Customs and Patent Appeals, this decision of the Customs Court was affirmed, that court saying: "As a result of these considerations we arrive at the conclusion that the court below did not err in finding that neither foreign-market value nor cost of production is shown by the record, and we agree with the conclusion of Judge Cline that the appeal to reappraisement might well have been dismissed by the trial judge." United States v. Cottman & Co., 23 C.C. P.A., Customs, 378. An application to the Supreme Court for writ of certiorari to review this decision was denied. 289 U.S. 750, 53 S.Ct. 695, 77 L.Ed. 1495.

When the case came on for hearing for the third time before the single judge of the Customs Court, he dismissed the "appeal to reappraisement," in accordance with the direction of the Third Division affirmed by the Court of Customs and Patent Appeals. On further appeal to the Third Division, this decision was reversed on the ground that the single judge should have set aside the appraisement as void and should have dismissed the appeals as from nonexistent appraisements. On appeal to the Court of Customs and Patent Appeals, however, this third decision of the Third Division was reversed and the decision of the single judge affirmed; four of the five judges of the Court of Customs and Patent Appeals joining in the affirmance. Two of these judges in an opinion by Presiding Judge Graham based their decision on the ground that the second decision of the Third Division, affirmed by the Court of Customs and Patent Appeals, had become the law of the case and the action of the single judge was in accordance therewith. Judges Lenroot and Hatfield concurred in the view that the action of the single judge in dismissing the...