Swisher Intern., Inc. v. U.S., Slip Op. 98-153.
| Decision Date | 06 November 1998 |
| Docket Number | Court No. 95-03-00322.,Slip Op. 98-153. |
| Citation | 27 F.Supp.2d 234 |
| Parties | SWISHER INTERNATIONAL, INC., Plaintiff, v. The UNITED STATES, Defendant. |
| Court | U.S. Court of International Trade |
McKenna & Cuneo, L.L.P. (Peter Buck Feller, Joseph F. Dennin, and Daniel G. Jarcho), for plaintiff.
Frank W. Hunger, Assistant Attorney General, David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Jeanne E. Davidson, Todd M. Hughes, and Lara Levinson), Richard McManus Office of the Chief Counsel, United States Customs Service, of counsel, for defendant.
Neville, Peterson & Williams (John M. Peterson, George W. Thompson, Lawrence J. Bogard, and Michael K. Tomenga), for amici curiae Totes-Isotoner, Inc., et al.
This action seeking recovery of Harbor Maintenance Taxes (HMT) pursuant to 28 U.S.C. § 1581(a) (1994) () is before the court on cross motions for summary judgment.
Swisher International, Inc. paid HMT on a quarterly basis from the fourth quarter of 1990 through the second quarter of 1994. Swisher filed refund requests on Customs Form 350 on the basis that the statute imposing HMT on exports is unconstitutional. The refund requests were denied on October 26, 1994. On November 21, 1994 Customs promulgated specific procedures for filing protests challenging the constitutionality of HMT on exports. See User Fee Protests, 59 Fed.Reg. 60044 (Dep't Treasury 1994). On November 23, 1994 Swisher protested the denial in the manner instructed by Customs. Swisher requested an accelerated disposition of the protest under 19 U.S.C. § 1515(b) (1994) on February 24, 1995. Swisher then filed this action on March 29, 1995, which was three days after the protest would have been denied by operation of law, see 19 U.S.C. § 1515(b), if the protest had been one of the protestable decisions listed in 19 U.S.C. § 1514(a) (1994).
The HMT statute was declared unconstitutional as applied to foreign exports, as are at issue here. U.S. v. U.S. Shoe Corp., ___ U.S. ___, 118 S.Ct. 1290, 140 L.Ed.2d 453 (1998). In U.S. Shoe, the Supreme Court found that jurisdiction lay under 28 U.S.C. § 1581(i) (1994).1 Id. at 1293-94. The applicable statute of limitation is 28 U.S.C. § 2636(i) (1994),2 which permits suit to be commenced within two years of payment of the tax. See Stone Container Corp. v. United States, Slip Op. 98-143, No. 96-10-02366, 1998 WL 800017 (Ct. Int'l Trade Oct. 5, 1998). Thus, some of plaintiff's claims will be timed barred unless jurisdiction is also cognizable under 28 U.S.C. § 1581(a).
Swisher participated as an amicus curiae before both this court and the Court of Appeals for the Federal Circuit, raising its refund protest denial theory, but as it was not a party it could not obtain a definitive disposition of its theory.3 The court addresses it now.
The Supreme Court recognized jurisdiction over suits to recover HMT on exports as lying under 28 U.S.C. § 1581(i), the residual jurisdiction of the court. U.S. Shoe, 118 S.Ct. at 1293-94. Section 1581(i) applies if none of the other sections of 28 U.S.C. § 1581 are available for relief. Miller & Co. v. United States, 824 F.2d 961, 963 (Fed.Cir. 1987), cert. denied 484 U.S. 1041, 108 S.Ct. 773, 98 L.Ed.2d 859 (1988) (citing cases). This means that if one had the opportunity for access to the court under 28 U.S.C. § 1581(a),4 albeit after exhausting mandatory administrative remedies, there is no § 1581(i) jurisdiction. Lowa, Ltd. v. United States, 5 CIT 81, 88, 561 F.Supp. 441, 446-47 (1983), aff'd, 724 F.2d 121 (Fed.Cir.1984).
Of course, it is possible that there is an exception to the long line of case law on this point because of the uniqueness of a suit based on exports, as opposed to imports, the normal subject matter of the court. The court finds this not to be the case. In fact, it is this uniqueness which reinforces the applicability of the standard jurisprudence. Section 1581(i) provides jurisdiction because recovery of HMT on the basis of the statute's unconstitutionality cannot be shoe-horned into Customs' protest procedures. What may be protested is a decision of Customs falling within the categories set forth in 19 U.S.C. § 1514(a).5 Swisher alleges that Customs' "decision" to deny its refund request was a decision regarding the "amount of duties chargeable" or a "charge or exaction."
First, and most importantly, U.S. Shoe, 118 S.Ct. at 1293-94, makes clear that there is no protestable Customs decision with respect to the constitutionality of HMT. It would be incongruous to permit conversion of "no decision" into a protestable decision, by means of the unilateral choice of the exporter to seek a refund at any time of its choosing. There are no time limits for the request or for the Customs decision thereon under 19 C.F.R. § 24.24(e)(5) (1997), which provides for HMT refund requests. Interpretation of the law to put control of the setting of limitations periods in the hands of one party to the dispute is disfavored. United States v. Cocoa Berkau Inc., 990 F.2d 610, 614 (Fed.Cir. 1993) () (quoting United States v. Commodities Export Co., 972 F.2d 1266, 1271 (Fed.Cir.1992)).
Second, it is clear that no liquidation is involved. At most, plaintiff analogizes the denial of the refund request to a liquidation, but it is not a liquidation as that term is understood — the final determination of import duties. See 19 C.F.R. § 159.1 (1998) (). It is a liquidation which settles "the amount of duties owing." It is also "charges or exactions" that merge into liquidation which are protestable. United States v. Utex International, Inc., 857 F.2d 1408, 1414 (Fed.Cir.1988) (). See also United States v. Ataka America, Inc., 17 CIT 598, 606, 826 F.Supp. 495, 502 (1993) (). Utex and Ataka are fully consistent with the traditional definition of charge or exactions as "specific sums of money (other than ordinary customs duties) on imported merchandise." Alberta Gas Chemicals, Inc. v. Blumenthal, 82 Cust. Ct. 77, 82, 467 F.Supp. 1245, 1249-50 (1979) (emphasis added). Utex and Ataka are also reconcilable with Norfolk & Western Railway v. United States, 18 CIT 55, 843 F.Supp. 728 (1994), aff'd, 62 F.3d 1395 (Fed. Cir.1995) (), as the fees in Norfolk were intimately connected to importation. General Motors Corp. v. United States, 10 CIT 569, 643 F.Supp. 1139 (1986) is similar and protestability was a more central issue in that case. See also Carlingswitch, Inc. v. United States, 68 C.C.P.A. 49, 55, 651 F.2d 768, 773 (1981) () Thus, it appears there is nothing which may be protested as a prerequisite to 28 U.S.C. § 1581(a) jurisdiction in this case.
Further, while Customs may provide refund and "protest" procedures for the convenience of the parties, if such administrative procedures are not mandatory, they will not toll the statute of limitations. See Cocoa Berkau, 990 F.2d at 615-16 (); Ataka America, Inc., 17 CIT at 605, 826 F.Supp. 495, 501-02 (same). Because administrative procedures have been found not to be mandatory as to challenges to the unconstitutionality of HMT on exports, see U.S. Shoe, 118 S.Ct. at 1293, they do not toll the statute. As indicated in the discussion of liquidation, supra, even as to questions of interpretation of the HMT statute itself or with regard to factual questions as to HMT on exports, 28 U.S.C. § 1581(a) protest denial jurisdiction is in doubt.
Plaintiff, however, relies heavily on Customs' alleged authority to issue protestable refund decisions under 19 C.F.R. § 24.24(e)(5) (1997), and to case law finding protest necessary for the full array of legal issues arising out of a refund denial.6 While Customs may have the authority to make decisions with regard to HMT amount, as opposed to the constitutionality of the statute, as indicated it is not at all clear that the mandatory protest procedures of 19 U.S.C. § 1514(a) apply to even such limited decisions, where exports are involved. It may be that for such cases 28 U.S.C. § 1581(i) is the applicable jurisdictional provision. The remedy under 19 C.F.R. § 24.24(e)(5) may be read as the type of remedy which should be exhausted if Customs may make a meaningful, that is, non-futile decision. See 28 U.S.C. § 2637(d) (1994) (). It may be, however, that there is no regulatory time limit precisely because the time limit is necessarily dictated by the statute of limitation applicable to 28 U.S.C. § 1581(i). In such a case the statute would continue to run until suit is filed. Thus, if a party which paid HMT on exports seeks a refund because of an ordinary dispute within Customs' jurisdiction, it should promptly request one from Customs. It has not been determined, however, that such a request will toll the statute.7
Defendant opined at oral argument that the refunds referred to in 19 C.F.R. § 24.24(e)(5) are those described in 19 U.S.C. § 1520(c) (1994) and that refunds under that provision may be made for errors of fact only. Generally, Customs makes refunds of monies erroneously collected pursuant to 19 U.S.C. § 1520. Section 1520(c), which allows...
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Swisher International v. U.S.
...1581(i) was applicable, thus barring Swisher's claims for a refund of all HMT paid prior to October 27, 1992. See Swisher Int'l, Inc. v. United States, 27 F.Supp.2d. 234. Swisher timely appealed to this This court has jurisdiction over this appeal, as it seeks review of a final decision of ......