NATIONAL CUSTOMS BROKERS AND FORWARDERS v. US, Court No. 89-07-00400.

• Decision Date: 10 October 1989
• Docket Number: Court No. 89-07-00400.
• Citation: 13 CIT 803,723 F. Supp. 1511
• Parties: NATIONAL CUSTOMS BROKERS AND FORWARDERS ASSN. OF AMERICA, Plaintiff, v. The UNITED STATES, et al., Defendants.
• Court: U.S. Court of International Trade

723 F. Supp. 1511

13 CIT 803

NATIONAL CUSTOMS BROKERS AND FORWARDERS ASSN. OF AMERICA, Plaintiff, v. The UNITED STATES, et al., Defendants.

Court No. 89-07-00400.

United States Court of International Trade.

October 10, 1989.

Tompkins & Davidson, Brian S. Goldstein, New York City, for plaintiff.

Stuart E. Schiffer, Acting Asst. Atty. Gen., Washington, D.C., Joseph I. Liebman, Atty. in Charge, Intern. Trade Field Office, Civ. Div., U.S. Dept. of Justice, New York City, Susan Burnett Mansfield and Richard McManus, U.S. Customs Service, for defendants.

OPINION

RESTANI, Judge:

Plaintiff, National Customs Brokers and Forwarders Association, Inc. (NCBFA, Association), brings this action seeking a preliminary injunction, a writ of mandamus, and a declaratory judgment to compel defendants, the Secretary of the Department of Treasury and the Commissioner of Customs (Customs), to promulgate regulations affecting the hierarchy of brokers entitled to enter goods in accordance with 19 U.S.C. § 1484(a)(2)(C) (1983). In its complaint plaintiff admits that this Court does not possess jurisdiction under 19 U.S.C. §§ 1581(a)-(h) and, therefore, it invokes this court's general jurisdictional grant under 28 U.S.C. § 1581(i) (1982).¹ That section provides this court with exclusive jurisdiction over "any civil action commenced against the United States, its agencies, or its officers, that arises out of any law of the United States providing for ... administration and enforcement with respect to various tariff and trade laws." 28 U.S.C. § 1581(i)(4).

Defendants opposed the motion for a preliminary injunction on several grounds including: (1) lack of subject matter jurisdiction over the issue in dispute; (2) lack of standing; and (3) failure to satisfy the standard four factor test for ascertaining whether preliminary injunctive relief should be granted. See Matsushita Elec. Indus. Co. v. United States, 823 F.2d 505, 509 (Fed.Cir.1987); S.J. Stile Assoc., Ltd. v. Snyder, 68 CCPA 27, 29-32, 646 F.2d 522, 525-27 (1981). This court will discuss each of these issues seriatim.

I. BACKGROUND

Soon after the expansion of private international courier services in the late 1970s Customs issued rulings under former section 1483 of the Tariff Act of 1930, ch. 497, 46 Stat. 590, 721, 19 U.S.C. § 1483 (1930), amended, Pub.L. 95-410, 92 Stat. 901 (1978), repealed, Pub.L. 97-446, 96 Stat. 2349 (1983), acknowledging that courier services could enter consolidated shipments into the country without resort to the assistance of properly licensed customs brokers. See 15 Cust. Bull. 273, Treas. Dec. 81-108 (1981) & 15 Cust. Bull. 1065, Cust. Serv. Dec. 81-169 (1981). In response to the perceived inadequacy of this procedure, Congress, in 1983, amended section 1484, inter alia, to require courier services to employ properly licensed brokers when entering consolidated shipments through customs. Pub.L. 97-446, 96 Stat. 2329, 2350 (1983) (codified as amended at 19 U.S.C. § 1484(a)(2)(C) (1982)).² In an attempt to comply, courier services employed their own brokers, who expedited entry of bulk consolidated shipments without referring individual pieces of merchandise to those brokers or ports designated on the individual bills of lading. Customs generally permitted expedited entry by simple reference to a master bill of lading on which all individual entries were logged. This practice continues to the present time.

According to plaintiff NCBFA, this procedure is not a proper implementation of the statute as amended. NCBFA maintains that the "appropriately designated" broker specified in section 1484(a)(2)(C) is the broker originally chosen by the owner, purchaser, or consignor of each individual shipment consolidated under the master bill of lading. Hence, argues the Association, if a single set of merchandise in a consolidated shipment has attached to it a bill of lading designating a port of entry other than that used by the courier service (or specifying a broker other than the one employed by the courier service), Customs should honor the original request of the consignor of that piece of merchandise by requiring the courier service to deconsolidate the entire shipment and by directing the courier service to proceed with entry of the merchandise according to the specific instructions on the individual bill of lading.

Indeed, this latter approach to entry of consolidated shipments was considered seriously by Customs and, for the most part, was reflected in a series of proposed rules which were withdrawn finally on February 1, 1989. See Withdrawal of Proposed Customs Regulations, 54 Fed.Reg. 5091 (1989). Customs withdrew the proposed regulations because "many of the commentators considered the regulations unnecessary and commercially burdensome." Id. In addition, Customs "determined that it should not be involved in refereeing contractual agreements between parties regarding the selection of a customs broker to make entry." Id. Dissatisfied with this result, NCBFA filed the present action.

II. JURISDICTION

As noted above, NCBFA claims that jurisdiction over this action is found in section 1581(i)(4). Section 1581(i)(4) contains Congress' residual grant of jurisdiction over various conflicts and disputes arising out of United States tariff and international trade laws. Di Jub Leasing Corp. v. United States, 1 CIT 42, 43-44, 505 F.Supp. 1113, 1115-16 (1980) (citing House Judiciary Committee Report, H.R.Rep. No. 96-1235 at 27-28, reprinted in 1980 U.S. CODE CONG. & ADMIN. NEWS 3729, 3739-3740). In interpreting the language of sections 1581(i)(1) & (4) and their accompanying legislative history, this court held in Di Jub Leasing that it had jurisdiction to consider the Commissioner of Customs' revocation of a customshouse cartman's license even though such jurisdiction was not explicitly provided for in section 1581. Id. at 44-49, 505 F.Supp. 1116-19. The court reasoned that the revocation of a cartman's license under Customs' regulations was intertwined with and directly related to the administration and enforcement of the laws providing for revenue from imports. Id. at 46, 505 F.Supp. at 1117. In addition, in Nat'l Bonded Warehouse Ass'n, Inc. v. United States, 13 CIT ___, 706 F.Supp. 904, 908 (1989) the court recently cited Di Jub Leasing in support of the proposition that it has jurisdiction under 28 U.S.C. § 1581(i)(4) to hear challenges to assessments of annual bonded warehouse fees. Nat'l Bonded at 905-08. See also 19 U.S.C. § 1555 (1982).

Most recently, in Sharp Electronics Corp. v. United States, 13 CIT ___, Slip. Op. 89-129, 1989 WL 107365 (Sept. 13, 1989), the court held that Section 1581(i) jurisdiction also encompasses the administration of a settlement agreement in an antidumping action because "resolution of whether the term `traditional methodology' is being properly implemented under the agreement requires particularized knowledge and proficiency with the antidumping duty laws" and that the action involved there challenged "the administration and enforcement of those laws." Id. at 5 & 6. Defendants, nonetheless, cite Sharp Electronics as if it should be interpreted to limit Section 1581(i)(4) because Sharp at 4 cites language of K Mart Corp. v. Cartier, Inc., 485 U.S. 176, 108 S.Ct. 950, 99 L.Ed.2d 151 (1988), to the effect that Congress chose not to "commit to the Court of International Trade's exclusive jurisdiction every suit against the Government challenging customs-related laws and regulations." K Mart 108 S.Ct. at 958 (emphasis in original). Defendant's Opposition to Plaintiff's Motion for a Preliminary Injunction at 12. This court, however, cannot find any language in Sharp Electronics which indicates that § 1581(i)(4) is narrower than it reads. Sharp, rather, supports plaintiff's view that section 1581(i) applies to the instant case because this case falls literally within § 1581(i) and because it involves interpretation of tariff laws within the expertise of this court. K Mart is clearly distinguishable.

In K Mart district court jurisdiction was challenged. Plaintiff had sought to prevent the Customs Service from permitting the importation of certain trademarked goods, known as gray-market goods. In finding that the district court had jurisdiction to decide the matter before it, the Supreme Court held that the action was not within the exclusive jurisdiction of the Court of International Trade, because the case did not involve embargoes, K Mart 108 S.Ct. at 957-58, or administration and enforcement with respect to protestable matters. Id. at 959-60. The court ruled that the issue before it involved the interpretation of the trademark laws, an area over which the district courts traditionally have had jurisdiction. K Mart at 958-59; see also 28 U.S.C. § 1338(a) (1982). The instant case, however, not only is intertwined with the administration and enforcement of the laws dealing with tariffs, as K Mart was not, see section 1581(i)(1) & (2) in connection with section 1581(i)(4), but raises issues related to subsidiary areas clearly within the court's jurisdiction. That is, this case involves issues relating to the administration of customs brokers licenses and permits, 19 U.S.C. § 1641, and, more directly, to the proper procedures under the customs laws for entry of merchandise, 19 U.S.C. § 1484. See 28 U.S.C. §§ 1581(a) & (g). Such issues ordinarily are not the subject of district court litigation and the district courts generally lack expertise in such areas. Thus, for several reasons K Mart is of no avail to defendants in the instant case.

Nonetheless, this court is not unmindful of parallel proceedings on precisely the same issue in the District of New Jersey. That court transferred a dispute involving facts and legal issues substantially similar to the instant one to the Eastern District of New York because plaintiff's "member customs brokers did business primarily in the vicinity of JFK airport." JFK Airport...