United States v. Great American Insurance Company of New York

Slip Op. 17-61
UNITED STATES COURT OF INTERNATIONAL TRADE
UNITED STATES,
Plaintiff,
v.
GREAT AMERICAN INSURANCE
COMPANY OF NEW YORK,
Defendant.
Before: Mark A. Barnett, Judge
Court No. 15-00047
PUBLIC VERSION
OPINION
[The court grants Plaintiff’s motion for summary judgment, in part, and denies
Defendant’s motion for summary judgment.]
Dated: May 18, 2017
Monica P. Triana, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, of Washington, DC, for plaintiff. With her on the brief were Chad
A. Readler, Acting Assistant Attorney General, and Amy M. Rubin, Assistant Director,
International Trade Field Office.
Barry M. Boren, Law Offices of Barry Boren, of Miami, FL, and Gerson M. Joseph,
Gerson M. Joseph, P.A., of Weston, FL, for defendant.
Barnett, Judge: The United States of America (“United States” or “Plaintiff”) sued
Great American Insurance Company of New York (“GAIC” or “Defendant”) to recover
$50,000 in unpaid antidumping duties and interest, the limit on a continuous entry bond
that GAIC issued, plus pre- and post-judgment interest, including statutory interest
pursuant to 19 U.S.C. § 580 (2006) 1 and equitable interest. See generally Compl., ECF
1 All references to the United States Code are to the 2006 edition, as determined by the
date of importation of the subject merchandise, unless otherwise stated.
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No. 2. Plaintiff and Defendant both filed motions for summary judgment; those motions
are fully briefed. See Confidential Pl.’s Mot. for Summ. J. and Pl.’s Mem. of Law in
Supp. of its Mot. for Summ. J. (“PMSJ”), ECF No. 55; Great Am. Ins. Co. of New York’s
Mot. for Summ. J. and Supporting Mem. of Law, ECF No. 47; Mem. of Law in Supp. of
the Def.’s, Great Am. Ins. Co. of New York, Mot. for Summ. J. (“DMSJ”), ECF No. 48.
The court has subject matter jurisdiction pursuant to 28 U.S.C. § 1582. For the reasons
discussed below, the court grants Plaintiff’s motion for summary judgment, in part, and
denies Defendant’s motion for summary judgment.
S TANDARD OF REVIEW
The court may grant summary judgment when “there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a matter of law” based on
the materials in the record. U.S. Court of International Trade (“USCIT”) Rule 56(a);
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). When both parties move
for summary judgment, the court generally must evaluate each party’s motion on its own
merits and draw all reasonable inferences against the party whose motion is under
consideration. JVC Co. of Am., Div. of US JVC Corp. v. United States, 234 F.3d 1348,
1351 (Fed. Cir. 2000). Ultimately, the court’s function is “not . . . to weigh the evidence
and determine the truth of the matter but to determine whether there is a genuine issue
for trial.” Anderson, 477 U.S. at 249. A dispute about a material fact is genuine when it
“may reasonably be resolved in favor of either party.” Id. at 249-50 (to defeat summary
judgment, the opponent must do more than present evidence that is “merely colorable”
or “not significantly probative,” rather, the opponent must present sufficient evidence on
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a disputed factual issue tending to show that “a jury [could] return a verdict for that
party”).
USCIT Rule 54(b) governs the entry of partial summary judgment. Rule 54(b)
provides that “[w]hen an action presents more than one claim for relief, . . . the court
may direct entry of a final judgment as to one or more but fewer than all claims . . . only
if the court expressly determines that there is no just reason for delay.” USCIT Rule
54(b).
B ACKGROUND
I. 	Material Facts Not Genuinely in Dispute
Pursuant to USCIT Rule 56(c)(1)(A), movants are to present material facts as
short and concise statements, in numbered paragraphs, with citations to “particular
parts of materials in the record” as support. See USCIT Rule 56.3(a)("factual positions
described in Rule 56(c)(1)(A) must be annexed to the motion in a separate, short and
concise statement, in numbered paragraphs"). In responsive papers, the opponent
"must include correspondingly numbered paragraphs responding to the numbered
paragraphs in the statement of the movant." USCIT Rule 56.3(b). “If a party fails to
properly . . . address another party's assertion of fact as required by Rule 56(c), the
court may . . . consider the fact undisputed for purposes of the motion.” USCIT Rule
56(e)(2).
Parties submitted separate statements of undisputed material facts with their
respective motions and responses to the opposing party's statements. See Confidential
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Pl.’s Statement of Undisputed Facts (“PSOF”), ECF No. 55; 2 Def., GAIC’s, Objs. to the
Pl.’s Statement of Undisputed Facts (“Def.’s Resp. to PSOF”), ECF No. 52-2;
Uncontested Material Facts (“DSOF”), ECF No. 48 (pp. 11-12); Pl.’s Resp. to Def.’s
Statement of Undisputed Facts (“Pl.’s Resp. to DSOF”), ECF No. 61. Upon review of
Parties' facts (and supporting documents), the court finds the following material facts not
genuinely disputed. 3
A. 	Overview of the Bond and Entry at Issue
On July 29, 2003, GAIC issued a $50,000 continuous bond to secure the payment
of duties, taxes, and charges on merchandise imported by Orleans Furniture Inc.
(“Orleans Furniture”). PSOF ¶ 1; Def.’s Resp. to PSOF. 4 The bond had an effective
date of August 22, 2003, and a termination date of August 31, 2007. PSOF ¶ 2; Def.’s
Resp. to PSOF.
On June 1, 2006, Orleans Furniture made one entry (Entry Number 322-
5581818-2) of parts of wooden bedroom furniture from the People's Republic of China. 5
2 Plaintiff submitted its statement of facts in a single electronic filing (ECF No. 55) along
with its motion, memorandum of law, and confidential exhibits. The statement of facts is
located at pp. 52-59 of ECF No. 55.
3 Citations are provided to the relevant paragraph number of the undisputed facts and
response; internal citations generally have been omitted. Citations to the record are
provided when a fact, though not admitted by both Parties, is uncontroverted by record
evidence.
4 Defendant’s response to Plaintiff’s statement of facts only included paragraphs
addressing its objections to Plaintiff’s assertions; it did not include paragraphs admitting
any of Plaintiff’s assertions. See Def.’s Resp. to PSOF. Accordingly, the court cites to
Defendant’s response generally when recounting facts that Defendant did not dispute.
5 Plaintiff asserts an entry date of June 5, 2006, and contends the entry consisted of
“wooden bedroom furniture.” PSOF ¶ 2 (citing Compl., Confidential Ex. B ("Entry
Summary"), ECF No. 4-1). Defendant asserts an entry date of June 1, 2006. DSOF ¶ 1
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PSOF ¶ 2; Def.’s Resp. to PSOF; DSOF ¶ 1; PL.’S RESP. TO DSOF ¶ 1. 6 On the Entry
Summary, Orleans Furniture identified the relevant antidumping duty (“AD”) order and
exporter using Commerce case number "A-570-890-101." PSOF ¶ 4; Def.’s Resp. to
PSOF. 7 Commerce case number A-570-890-101 is associated with exporter Gaomi
Yatai Wooden Ware Co., Ltd. ("Gaomi Yatai"). PSOF ¶ 10. 8 Commerce later
(citing Def. Ex. 1, ECF No. 48-1 (copy of the Entry Summary)). Defendant does not
object to Plaintiff’s description of the subject merchandise in its response to Plaintiff’s
statement of facts, but elsewhere contends the subject merchandise consisted of parts,
not finished bedroom furniture. See DMSJ at 31-32. Because Defendant’s date
corresponds to the date on the Entry Summary, see Entry Summary, the court relies on
that date. The court further notes that the Entry Summary describes the subject
merchandise as “wooden parts of furniture.” Id. The differences in dates and
description of the merchandise, however, are not material to the court’s resolution of the
summary judgment motions. Moreover, the court’s description of the subject
merchandise is not an indication of the court’s position on whether the subject
merchandise was within the scope of the relevant antidumping duty order. See infra
Background Sect. E (discussing Orleans Furniture’s protest of the reliquidation on the
basis that the subject merchandise was not covered by the relevant antidumping duty
order and Customs’ deemed denial thereof). The time for seeking judicial review of the
denied protest has long passed. See 28 U.S.C. § 2636(a) (a civil action challenging the
deemed denial of a protest must be filed within 180 days of the denial).
6 The total entered value for the merchandise was [[ 	]]. PSOF ¶ 3; Def.’s Resp. to
PSOF.
7 The first six digits (A-570-890) are specific to the AD order; the last three digits (101)
are specific to a particular manufacturer/exporter. PSOF ¶¶ 4, 9; Def.’s Resp. to PSOF.
Use of "000" as the last three digits of the case number indicates that the China-wide
rate applies to the merchandise. PSOF ¶ 8; Def.’s Resp. to PSOF.
8 Defendant objects to this statement on the basis that "[n]owhere in any of the
liquidation directives issued by Commerce does the case [number] A-570-890-101
appear[,] nor is it associated with [Gaomi Yatai] in the directives." Def.’s Resp. to PSOF
¶ 10. In fact, suspension of liquidation instructions issued by Commerce on February
24, 2009 (Message 9055211) specifically identify Gaomi Yatai with Commerce case
number A-570-890-101. PMSJ, Ex. 4 ("Feb. 24, 2009 Suspension Instructions") at
CBP000014. Because there is uncontroverted record evidence demonstrating that
Commerce case number A-570-890-101 appears in Commerce's instruction to Customs
and is associated with Gaomi Yatai, there is no genuine dispute as to that fact. See
Anderson, 477 U.S. at 249.
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determined that the exporter was Company X. 9 PSOF ¶12; Def.’s Resp. to PSOF.
Exports from Company X are subject to the China-wide rate. PSOF ¶ 12; Def.’s Resp.
to PSOF.
B. 	Antidumping Duty Order and Administrative Review
On November 17, 2004, Commerce issued its final determination of sales at less
than fair value in the antidumping duty investigation of wooden bedroom furniture from
the People’s Republic of China (“PRC” or “China”). DSOF ¶ 2; Pl.’s Resp. to DSOF ¶ 2;
see also Wooden Bedroom Furniture From the People’s Republic of China, 69 Fed.
Reg. 67,313 (Dep’t of Commerce Nov. 17, 2004) (final determination of sales at less
than fair value); Wooden Bedroom Furniture From the People's Republic of China, 70
Fed. Reg. 329 (Dep’t of Commerce Jan. 4, 2005) (notice of am. final determination of
sales at less than fair value and antidumping duty order). 10
On March 7, 2007, Commerce initiated an administrative review of wooden
bedroom furniture imported from China for the period of review ("POR") from January 1,
9 Company X is identified as [[ 	]]. PSOF ¶ 12; Def.’s Resp.
to PSOF.
10 The scope of the order included “wooden bedroom furniture” that “is generally, but not
exclusively, designed, manufactured, and offered for sale in coordinated groups.”
Wooden Bedroom Furniture From the People’s Republic of China, 69 Fed. Reg. at
67,314. Excluded from the scope are:
unfinished furniture parts made of wood products . . . that are not
otherwise specifically named in this scope (i.e., wooden headboards for
beds, wooden footboards for beds, wooden side rails for beds, and
wooden canopies for beds) and that do not possess the essential
character of wooden bedroom furniture in an unassembled, incomplete, or
unfinished form. Such parts are usually classified in subheading
9403.90.7000, HTSUS.
69 Fed. Reg. at 67,314 n.13.
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2006 to December 31, 2006 (the "2006 POR"). PSOF ¶ 13; Def.’s Resp. to PSOF; see
also Wooden Bedroom Furniture From the People’s Republic of China, 72 Fed. Reg.
10,159 (Dep’t of Commerce March 7, 2007) (notice of initiation of admin. review of the
antidumping duty order). The liquidation of entries subject to the review was suspended
pending completion of the review. PSOF ¶ 13; Def.’s Resp. to PSOF; DSOF ¶ 3; Pl.’s
Resp. to DSOF ¶ 3.
On August 20, 2008, Commerce published the final results of its review. PSOF
¶ 14; Def.’s Resp. to PSOF; see also Wooden Bedroom Furniture From the People’s
Republic of China, 73 Fed. Reg. 49,162 (Dep’t of Commerce Aug. 20, 2008) (final
results of antidumping duty admin. review and new shipper review; 2006); Wooden
Bedroom Furniture From the People’s Republic of China, 74 Fed. Reg. 4,916 (Dep’t of
Commerce Jan. 28, 2009) (am. final results of antidumping duty admin. review; 2006).
Publication of the final results lifted the suspension of liquidation for entries subject to
the review. PSOF ¶ 15; Def.’s Resp. to PSOF.
On January 27, 2009, Commerce issued Message 9027213 instructing Customs
to assess antidumping duties at a rate of 216.01% to entries subject to the China-wide
rate and identified by Commerce case number A-570-890-000. PSOF ¶ 16; Def.’s
Resp. to PSOF; see also PMSJ, Confidential Ex. 3 ("Jan. 27, 2009 Liquidation
Instructions"). For all other entries, Commerce ordered Customs to "continue to collect
cash deposits of estimated [AD] duties [for the merchandise] at the current cash deposit
rates." PSOF ¶ 17; Def.’s Resp. to PSOF.
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C. 	Court Proceedings Enjoining Liquidation
On February 13, 2009, the court issued a temporary restraining order (“TRO”)
enjoining the liquidation of 2006 POR entries from several exporters, including Gaomi
Yatai. PSOF ¶ 18 (citing Am. Signature, Inc. v. United States, Consol. Court No. 08-
00316, Order (Feb. 13, 2009) (“Am. Signature TRO”), ECF No. 64). The court
subsequently issued a preliminary injunction in that case. PSOF ¶ 18 (citing Am.
Signature, Consol. Court No. 08-00316, Order (Feb. 24, 2009) ("Am. Signature Prelim.
Inj."), ECF No. 70). Pursuant to the TRO, Commerce issued Message 9055211
instructing Customs to suspend the liquidation of entries exported by Gaomi Yatai for
the 2006 POR and identified by Commerce case number A-570-890-101, and which
remained unliquidated as of February 19, 2009. PSOF ¶ 19 (citing Feb. 24, 2009
Suspension Instructions). 11 A Customs official subsequently entered a notation in
11 Defendant objects to the facts asserted in paragraphs 18 and 19 of Plaintiff’s
statement of facts on the basis that Commerce's liquidation instructions directed
Customs to suspend liquidation of entries exported by Gaomi Yatai and imported by [[
]]. Def.’s Resp. to PSOF ¶¶18-19. Citing Commerce's January 27, 2009 Liquidation
Instructions, Defendant contends the injunction at issue "only applied to {[[ 	]]}
entries," and "[n]owhere does it say to suspend or liquidate entries with the number A-
570-890-101." Def.’s Resp. to PSOF ¶¶ 18-19.
Plaintiff, in fact, pointed to the TRO and preliminary injunction issued in American
Signature and to the customs message issued pursuant thereto. PSOF ¶¶ 18-19. Both
the TRO and the preliminary injunction refer to exports by Gaomi Yatai without any
limitation as to the importer. See Am. Signature TRO; Am. Signature Prelim. Inj.;
Message 9055211 (issued pursuant to the TRO) is consistent with that. Defendant’s
response refers to Message 9027213 issued pursuant to the Klaussner case. See
Def.’s Resp. to PSOF ¶¶ 18-19; Klaussner Furniture Industries, Inc., et al. v. United
States, et al., Consol. Court No. 08-00323. While Defendant correctly notes that the
injunction in that case is limited, in relevant part, to exports by Gaomi Yatai imported by
[[ 	]], it does not detract from the breadth of the injunction in American Signature,
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CBP's Automated Commercial Systems ("ACS") database stating that Entry Number
322-5518182 was "subject to [the] TRO dated 2/13/09 per CBP message 9055211,"
and that, therefore, the entry should not be liquidated "absent further instructions."
PSOF ¶ 20; Def.’s Resp. to PSOF; PMSJ, Ex. 5, ECF No. 60 (ACS entry notation).
Customs treated the entry as if it had been suspended. PSOF ¶ 21; Def.’s Resp. to
PSOF.
When the court dismissed American Signature on May 18, 2009, the injunction
dissolved and the suspension of liquidation of entries of merchandise exported by
Gaomi Yatai associated with Commerce case number A-570-890-101 was lifted. PSOF
¶ 22 (citing Am. Signature, Consol. Court No. 08-00316, Order (May 18, 2009), ECF No.
91); Def.’s Resp. to PSOF.
D. 	Liquidation of the Subject Entry
On June 23, 2009, Commerce issued Message 9174201 instructing Customs to
liquidate entries exported by Gaomi Yatai for the 2006 POR and assess an AD duty rate
of 32.23 percent. PSOF ¶ 23 (citing PMSJ, Ex. 6 ("June 23, 2009 Liquidation
Instructions")); Def.’s Resp. to PSOF. On September 30, 2009, John Gerace, a
Customs Supervisory Import Specialist, attempted to apply the June 23, 2009
Liquidation Instructions to the subject entry. PSOF ¶ 24. In so doing, he learned that
Orleans Furniture had used the wrong Commerce case number on the entry
nor does it create a genuine factual dispute. See Klaussner, Consol. Court No. 08-
00323, Order (Dec. 8, 2008), ECF No. 40.
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documents. PSOF ¶ 24. 12 Instead of Gaomi Yatai, the actual exporter was Company
X. PSOF ¶ 12; Def.’s Resp. to PSOF. "[Company X] was not entitled to a separate
12 Defendant objects, asserting that "CBP learned of the error on June 23, 2009, not
September 30, 2009." Def.’s Resp. to PSOF ¶ 24. Defendant does not object to
Plaintiff's assertion that Mr. Gerace attempted to apply the June 23, 2009 Liquidation
Instructions to the subject entry, or that Mr. Gerace himself learned of the error on
September 30, 2009. See Def.’s Resp. to PSOF ¶ 24.
Contrary to USCIT Rule 56.3(c), which requires "each statement controverting
any statement of material fact" to be "followed by citation to [admissible] evidence,"
Defendant does not offer evidentiary support for his assertion that someone at CBP
(other than Mr. Gerace) learned of the error on June 23, 2009. See Def.’s Resp. to
PSOF ¶ 24. However, in its statement of undisputed facts, Defendant similarly asserts
that "[a]t least as early as June 23, 2009, CBP had already decided to rate advance this
entry." DSOF ¶ 7 (citing DMSJ, Ex. 7 ("Sept. 30, 2009 ACS Entry Note")); see also Pl.’s
Resp. to DSOF ¶ 7 (objecting to the assertion). That entry note states:
AD CASE A570890101 WAS USED ERRONEOUSLY AT TIME OF
ENTRY, INCORRECT AD CASE NO. WAS DETECTED AT TIME OF LIQ.
INSTRUCTIONS (MSG. 9174201, DATED 6/23/09) CORRECT CASE
FOUND TO BE A570890000, LIQ INSTRUCTIONS PER MSG 9027213,
DATED 1/27/09. DEEM LIQ BY OP LAW.
Sept. 30, 2009 ACS Entry Note (underline added); see also PSOF ¶ 31 (reproducing
the entry note); Def.’s Resp. to PSOF. Thus, the basis for Defendant's objection is
language stating that the incorrect case number had been detected "at time of
[liquidation] instructions," and its interpretation of that language to mean that the error
had been detected when the June 23, 2009 Liquidation Instructions issued, not when
the instructions were applied. See DSOF ¶ 7.
It is undisputed that Mr. Gerace created the entry note on September 30, 2009
when he learned of the error. See PSOF ¶ 30 (averring that "[c]ontemporaneous with
Mr. Gerace's finding [of the error, he] entered a note into ACS explaining what had
taken place"); Def.’s Resp. to PSOF ¶ 30 (averring that "CBP discovered the error on
June 23, 2009 and not contemporaneously with Mr. Gerace's findings") (emphasis
added); see also Sept. 30, 2009 Entry Note (identifying "JGERACE" as the user
generating the entry); PMSJ, Confidential Ex. 1 (Declaration of John Gerace) (“Gerace
Decl.”) ¶¶ 11, 15 (averring that on September 30, 2009, Mr. Gerace learned that
Orleans Furniture had used the wrong case number and subsequently created the entry
note). Defendant's interpretation of the entry note language necessarily implies that Mr.
Gerace knew about an unidentified CBP official's prior knowledge and included it in the
entry note. But Defendant offers no evidence supporting this interpretation, nor does it
offer evidence contradicting Mr. Gerace’s sworn declaration. Conjecture and
speculation about when a Customs official learned of the importer’s error are insufficient
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rate, and the correct associated case number was A-570-890-000, to which a
corresponding duty rate of 216.01 [percent] applied." PSOF ¶ 26; Def.’s Resp. to
PSOF. Accordingly, the suspension of liquidation of entries exported by Gaomi Yatai
identified in Commerce's February 24, 2009 Suspension Instructions did not apply to the
subject entry; instead, publication of the August 20, 2008 Final Results lifted the
suspension of liquidation of entries subject to the review, including the subject entry,
and the January 27, 2009 Liquidation Instructions directing Customs to apply a 216.01
percent AD duty rate to entries subject to the China-wide rate and identified by
Commerce case number A-570-890-000 applied. PSOF ¶¶ 27-28. 13
to raise a genuine issue of material fact. See Applikon Biotechnology, Inc. v. United
States., 35 CIT ___, ___. 807 F. Supp. 2d 1323, 1325 n.2 (2011) (citing Kulak v. City of
New York, 88 F.3d 63, 71 (2d Cir.1996)). Instead, the opponent "must point to an
evidentiary conflict created on the record at least by a counter statement of a fact or
facts set forth in detail in an affidavit by a knowledgeable affiant." Barmag Barmer
Maschinenfabrik AG v. Murata Machinery, Ltd., 731 F.2d 831, 836 (Fed. Cir. 1984),
quoted in Processed Plastics Co. v. United States, 473 F.3d 1164, 1170 (Fed. Cir.
2006) (emphasis added). This, Defendant has not done. Accordingly, there is no
genuine dispute as to when Orleans Furniture's error was discovered. See Anderson,
477 U.S. at 249; USCIT Rule 56(e)(2).
13 Defendant objects that the "[i]nstructions in [M]essage 9055211 [i.e., the February 24,
2009 Suspension Instructions] did apply because the importer was Orleans and not {[[
]]}." Def.’s Resp. to PSOF ¶¶ 27-28. The point of Defendant's statement is unclear.
The February 24, 2009 Suspension Instructions suspended entries exported by Gaomi
Yatai regardless of the identity of the importer. See Feb. 24, 2009 Suspension
Instructions at CBP000014. 	However, Parties agree that [[ 	]] was the exporter, not
Gaomi Yatai, [[ 	]] was subject to the China-wide rate, the correct Commerce case
number was A-570-890-000, suspension of liquidation for the subject entry lifted on
August 20, 2008, upon publication of the Final Results, and, pursuant to the January 27,
2009 Liquidation Instructions, Commerce ordered Customs to apply a 216.01 percent
AD duty rate to entries subject to the China-wide rate and identified by Commerce case
number A-570-890-000. PSOF ¶¶ 12, 16, 26; Def.’s Resp. to PSOF; DSOF ¶ 4; Pl.’s
Resp. to DSOF ¶ 4. Defendant's objection fails to raise a genuine issue of material fact.
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By operation of law, on February 20, 2009, six months after suspension was
lifted, the subject entry liquidated (hereinafter referred to as the "deemed liquidation").
PSOF ¶ 29; Def.’s Resp. to PSOF; DSOF ¶ 5; Pl.’s Resp. to DSOF ¶ 5. On December
18, 2009, "the 'no-change' liquidation became effective in ACS, and Customs posted a
bulletin notice of the deemed liquidation for the [subject entry] on the same date."
PSOF ¶ 33; Def.’s Resp. to PSOF; DSOF ¶ 8; Pl.’s Resp. to DSOF ¶ 8. 14
On January 8, 2010, Customs reliquidated the entry at the correct AD rate of
216.01 percent. PSOF ¶ 35; Def.’s Resp. to PSOF ¶ 35; PSOF ¶ 36. 15
14 Plaintiff asserts as an undisputed fact that, after Mr. Gerace's discovery of the
incorrect case number, but before Customs posted the bulletin notice, "time was needed
to process the Entry, verify the case and rate information, generate a Notice of Action
(CF 29), forward the Notice of Action to the entry unit at Customs and allow time for
processing." PSOF ¶ 32 (citing Gerace Decl. ¶ 17). Defendant objects that "CBP
needed no time to verify any information . . . ." 	Def.’s Resp. to PSOF ¶ 32. Defendant,
again, does not cite to admissible evidence supporting its assertion or countering Mr.
Gerace’s sworn declaration. See Def.’s Resp. to PSOF ¶ 32; USCIT Rule 56.3(c).
Instead, Defendant points to its "answer brief," i.e., its opposition to Plaintiff's summary
judgment motion. Def.’s Resp. to PSOF ¶ 32. Therein, Defendant characterizes
Plaintiff's assertion as "curious" and "stunningly unconvincing.” See Def. Resp. at 9.
Defendant offers its “serious[] doubt” that the time taken by CBP to process the entry “is
even close to the time it takes a customhouse broker to actually prepare the entry,”
which must be done within 15 days of arrival, Def. Resp. at 9, and asserts that the math
required to calculate the correct AD duty “takes about two minutes” to complete, Def.
Resp. at 10 (citing Def.’s Resp., Ex. 3 (Customs’ Liquidation/Reliquidation Worksheet)).
Crucially, however, Defendant offers no evidence contradicting Mr. Gerace’s sworn
declaration concerning the actions CBP performed before posting the bulleting notice,
nor does it offer evidence supporting its objection that “no time” was needed by the
agency to complete those actions before posting the Bulletin Notice. See Def’s Resp. to
PSOF ¶ 32. Defendant's speculative objection is insufficient to raise a genuine dispute.
See Applikon Biotechnology, Inc., 807 F. Supp. 2d at 1325; Processed Plastics Co., 473
F.3d at 1170.
15 Defendant objects to Plaintiff’s assertion that the unpaid principal amounts to
$60,336.14, and asserts that the unpaid principal is $[[ 	]], but does not object to the
fact of reliquidation or correctness of the AD rate. Def.’s Resp. to PSOF ¶ 35. However,
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E. 	Protest and Demand for Payment from Surety
On February 4, 2010, Orleans Furniture protested the reliquidation on the basis
that AD duties should not have been assessed because the subject merchandise was
only "posts" and not finished bedroom furniture. PSOF ¶ 37; Def.’s Resp. to PSOF; see
also PMSJ, Ex. 10 (Protest Number 200610100128). Orleans Furniture requested
"accelerated disposition" of the protest pursuant to 19 C.F.R. § 174.22, which was
subsequently deemed denied. PSOF ¶ 38. 16 GAIC did not protest the reliquidation,
and neither Orleans Furniture nor GAIC challenged the deemed denial. PSOF ¶ 41;
Def.’s Resp. to PSOF.
On April 27, 2010, Customs sent GAIC a "Formal Demand on Surety for
Payment of Delinquent Amounts Due." 17 PSOF ¶ 42 (citing Compl., Confidential Ex. C
Defendant does not dispute that “CBP re-liquidated the entry with an ADD rate advance
of $60,336.14.” DSOF ¶ 9; Pl.’s Resp. to DSOF ¶ 9.
16 Defendant does not object to the assertion that Orleans Furniture requested
accelerated disposition, rather, that "[f]or the reasons stated in [its] Motion for Summary
Judgment, . . . the protest was not deemed denied." Def.’s Resp. to PSOF ¶ 38. It is
well settled that arguments by counsel cannot constitute facts for the purpose of
summary judgment. See, e.g., Gaub v. Professional Hosp. Supply, Inc., 845 F. Supp.
2d 1118, 1128 (D. Idaho 2012); Trinsey v. Pagliaro, 229 F. Supp. 647, 649 (D.C. Pa.
1964) (“Statements of counsel in their briefs . . . are not sufficient for purposes of . . .
summary judgment”). Further, as discussed herein, the legal basis for Defendant's
assertion (which concerns whether Customs’ deemed denial amounted to an ultra vires
ruling on the scope of the AD order) lacks merit. See infra Discussion Sect. III (Status
of Administrative Proceedings).
17 Defendant objects that the 612 Report "noted that there was an outstanding protest"
and "[was] not a demand on Surety." Def.’s Resp. to PSOF ¶¶ 42-43. 	Although
Defendant is correct the 612 Report listed Orleans Furniture's protest as "open," the 612
Report is plainly titled "Formal Demand on Surety for Payment of Delinquent Amounts
Due," and it cites the “APPROVAL/DENIAL DATE: 02/09/10” for the protest in question,
indicating that the deadline for ruling on the protest had passed. See 612 Report.
Defendant offers no evidence supporting its assertion that the 612 Report, so titled, is
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Court No. 15-00047 	Page 14
(“612 Report”)). 18 GAIC did not protest Customs "charge[s] or exaction[s]." PSOF ¶ 44;
Def.’s Resp. to PSOF. On December 15, 2014, Customs sent GAIC a letter demanding
payment of $50,000 (the face value of the issued bond). PSOF ¶ 45; Def.’s Resp. to
PSOF.
F. 	Procedural History
On February 19, 2015, the United States initiated this collection action against
GAIC for unpaid antidumping duties and interest. See generally Compl. Earlier in these
proceedings, GAIC moved to dismiss the complaint for failure to state a claim on the
grounds that Customs lacked authority to reliquidate an entry that had been deemed
liquidated and, alternatively, failed to timely reliquidate the entry. See generally Great
American Ins. Co. of New York’s Mot. to Dismiss and Supp. Mem. of Law (“Def.’s
MTD”), ECF No. 12. The court denied the motion to dismiss, finding that Customs has
statutory authority to reliquidate deemed liquidations within 90 days of transmitting
notice of the deemed liquidation to importers pursuant to 19 U.S.C. § 1501, 19 and the
not a demand for payment from surety. Accordingly, there is no genuine dispute as to
that fact. See Anderson, 477 U.S. at 249-50; USCIT Rule 56(e)(2).
18 According to the 612 Report, Customs sought payment of $60,336.14 in principal and
$398.02 in interest. 612 Report (line item for bill number 45462263).
19 In full, § 1501 provides:
A liquidation made in accordance with section 1500 or 1504 of this title or
any reliquidation thereof made in accordance with this section may be
reliquidated in any respect by the Customs Service, notwithstanding the
filing of a protest, within ninety days from the date on which notice of the
original liquidation is given or transmitted to the importer, his consignee or
agent. Notice of such reliquidation shall be given or transmitted in the
manner prescribed with respect to original liquidations under section
1500(e) of this title.
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complaint adequately alleged facts showing that Customs had timely reliquidated the
subject entry within the 90 day period. See generally United States v. Great American
Ins. Co. of New York, 39 CIT ___, 121 F. Supp. 3d 1288 (2015). The court further
found that the ten month delay from the date of the deemed liquidation to the date on
which Customs posted notice was not, “as a matter of law,” unreasonable. Id. at 1295.
Pending are the Parties’ motions for summary judgment. Plaintiff moves for
summary judgment on the basis that the undisputed material facts establish that the
time between the deemed liquidation and the posting of the bulletin notice of the
deemed liquidation was reasonable. See generally PMSJ. Defendant raises several
grounds for summary judgment; central to its motion, however, is Defendant’s
construction of the relevant statutory scheme as affording Customs 90 days (or
alternatively, 180 days) from the date on which entries are deemed liquidated to
voluntarily reliquidate those entries. See generally DMSJ. For the reasons discussed
below, the court grants Plaintiff’s motion, in part, and denies Defendant’s motion.
19 U.S.C. § 1501 (2006). As discussed herein, in 2016 Congress amended § 1501 to
provide for reliquidation within 90 days from the date of the deemed liquidation only and
not from the date on which notice of the deemed liquidation is given or transmitted to
the importer. However, that amendment does not apply here. See infra Discussion
Sect. I.B.b.ii.
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Court No. 15-00047 	Page 16
DISCUSSION
I. 	Defendant’s Ability to Challenge the Reliquidation
Plaintiff asserts two bases for precluding Defendant from challenging the
reliquidation: failure to exhaust administrative remedies and the doctrine of law of the
case. The court will address each, in turn.
A. 	Administrative Exhaustion
Plaintiff argues that, pursuant to 19 U.S.C. § 1514, Defendant is barred from
challenging the reliquidation because it failed to protest CBP’s demand for payment (the
612 Report) or challenge the denial of Orleans Furniture’s protest of the reliquidation.
PMSJ at 12-13; see also Confidential Pl.’s Reply Mem. of Law in Further Supp. of its
Mot. for Summ. J. (“Pl.’s Reply”) at 14-18, ECF No. 57. Defendant responds that the
finality provisions stated in § 1514 do not apply to reliquidations pursuant to 19 U.S.C.
§ 1501. GAIC Mem. of Law in Resp. to Pl.’s Mot. for Summ. J. (“Def.’s Resp.”) at 13,
ECF No. 52. Defendant broadly contends that it may raise any defense to the
government’s enforcement action without having filed a protest, and, more specifically,
that CBP’s reliquidation of an entry deemed liquidated did not have to be protested. Id.
at 13-16. 20
20 Defendant also asserts that “[a]ny CBP decision on a protest would have been ultra
vires,” and the deemed liquidation was final and conclusive. Def.’s Resp. at 14-15.
Defendant does not explain why CBP’s decision would have been ultra vires;
presumably, however, the assertion relates to Defendant’s separate argument that, in
the event the court finds the reliquidation to be valid, it is entitled to summary judgment
on the basis that Orleans Furniture’s protest could not have been deemed denied
because “any action (or non-action) by CBP on [Orleans Furniture’s] protest was an
ultra vires determination [by CBP on the scope of the AD order] and the issue is still
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a. 	Legal Framework
Section 1514 governs the finality of CBP’s decisions. In relevant part, it provides
that:
(a) [e]xcept as provided in . . . section 1501 of this title (relating to
voluntary reliquidations), . . . any clerical error, mistake of fact, or other
inadvertence, . . . adverse to the importer, in any entry, liquidation, or
reliquidation, and, decisions of the Customs Service . . . as to--
. . .
(3) all charges or exactions of whatever character within the
jurisdiction of the Secretary of the Treasury;
. . .
(5) the liquidation or reliquidation of an entry, or reconciliation as to
the issues contained therein, or any modification thereof, including the
liquidation of an entry, pursuant to either section 1500 of this title or
section 1504 of this title;
. . .
shall be final and conclusive upon all persons (including the United States
and any officer thereof) unless a protest is filed in accordance with this
section, or unless a civil action contesting the denial of a protest, in whole
or in part, is commenced in the United States Court of International Trade
. . . .
19 U.S.C. § 1514(a) (emphasis added). Either an importer or a surety may protest a
decision specified in § 1514(a). See id. § 1514(c)(2) (providing for protests by importers
or their sureties); id. § 1514 (c)(1) (noting that “[o]nly one protest may be filed for each
entry of merchandise,” but that “separate protests filed by different authorized persons
with respect to any one category of merchandise . . . are deemed to be part of a single
protest”). Additionally, a surety has “180 days from the date of mailing of notice of
pending.” DMSJ at 33. As discussed herein, Defendant’s argument lacks merit. See
infra Discussion Sect. III.
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Court No. 15-00047 	Page 18
demand for payment against its bond” to protest a claim against its bond. Id.
§ 1514(c)(3).
It is well settled that Customs’ findings related to a particular liquidation “merge
with the liquidation” and are final and conclusive unless challenged in accordance with
§ 1514. Volkswagen of Am., Inc. v. United States, 532 F.3d 1365, 1370 (Fed. Cir.
2008); see United States. v. Am. Home Assur. Co. (“AHAC (09-403)”), 39 CIT ___, ___,
100 F. Supp. 3d 1364, 1369 (2015). 21 Unprotested issues related to the liquidation of
the subject entries may not be “raised in any context,” United States v. Cherry Hill
Textiles, Inc., 112 F.3d 1550, 1557 (Fed. Cir.1997); that is, the rule of finality “applies to
both importer duty recovery suits and to [g]overnment enforcement actions,” AHAC (09-
403), 100 F.Supp.3d at 1369.
b. Analysis
i. 	Section 1514 Applies to Reliquidations
Defendant contends that § 1514 does not apply to reliquidations pursuant to 19
U.S.C. § 1501. Def.’s Resp. at 13. 22 In support, Defendant points to the first sentence
21 Because there are several cases involving American Home Assurance Company, for
ease of identification subsequent case citations include the USCIT Court No.
22 Defendant also contends that § 1514(a) only applies to “‘any clerical error, mistake of
fact, or other inadvertence,’” but does not apply to mistakes of law.” Def.’s Resp. at 13.
Defendants confuses the operative language. The “final and conclusive” language
stated in § 1514(a) applies to both “any clerical error, mistake of fact, or other
inadvertence . . . adverse to the importer, in any entry, liquidation, or reliquidation,” and
to “decisions of the Customs Service, . . . as to . . . the liquidation or reliquidation of an
entry.” § 1514(a); see also Pl.’s Reply at 13.
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of 19 U.S.C. § 1514, which governs the finality of Customs’ decisions as to liquidations
and reliquidations “[e]xcept as provided in . . . section 1501 . . . .” See id. at 13.
Defendant misreads the significance of the cited sentence. “Absent clear
legislative intent to the contrary, the plain meaning of [a] statute will prevail.” Lynteq,
Inc. v. United States, 976 F.2d 693, 699 (Fed. Cir.1992) (citation omitted). Pursuant to
§ 1514, “absent timely reliquidation or protest,” a liquidation is final and conclusive.
Volkswagen, 532 F.3d at 1370 (citation omitted); 19 U.S.C. § 1514. Section 1501
provides for voluntary reliquidation by CBP of entries affirmatively liquidated pursuant to
§ 1500 or deemed liquidated pursuant to § 1504. See 19 U.S.C. § 1501. Thus, in the
event CBP reliquidates an entry pursuant to § 1501, the reliquidation--not the original
liquidation--becomes “final and conclusive.” See id. § 1514(a)(5)(governing the finality
of reliquidations). Thus, Defendant’s argument, which essentially precludes
reliquidations pursuant to § 1501 from ever becoming “final and conclusive,” lacks merit.
ii. 	Defendant is Foreclosed From Challenging Matters
Subsumed by the Reliquidation
Defendant also contends that it may raise any defenses to liability in this
enforcement action notwithstanding its failure to protest the reliquidation that formed the
basis for the charge. Def.’s Resp. at 13-17. Defendant is incorrect.
As an initial matter, the 612 Report that Customs sent to GAIC on April 27, 2010
detailing the importer’s delinquent amounts due constitutes a protestable “decision[]” as
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Court No. 15-00047 	Page 20
to a “charge[]” for purposes of § 1514(a)(3). 23 The basis for Customs’ issuance of the
612 Report involved its substantive determinations regarding the subject entry’s
eligibility for reliquidation and the “applicable rate of duty.” See U.S. Shoe Corp., 114
F.3d at 1569. Customs then had to identify the relevant bonds, determine whether the
duties owed exceeded the face value of the bonds, determine any applicable rate of
interest, 24 and issue the demand for payment from the surety. Cf. AHAC (09-403), 100
F. Supp. 3d at 1370-71 (Customs decision to seek post-liquidation § 1505(d) interest
from the surety constituted a protestable charge; surety’s failure to seek judicial review
of denied protests barred it from asserting defenses to § 1505(d) liability). That demand
for payment “identif[ied] the name and address of the delinquent importer, the bill
number, billing date, port of entry, document date, entry number, the amount due, and
the importer number.” Peerless Ins. Co. v. United States, 12 CIT 1231, 1232-33, 703 F.
Supp. 104, 105 (1988) (noting that, “since 1977, Customs has issued its payment
demand to sureties containing such information); 612 Report. The court has found that
23 A “decision” is a “substantive determination[] involving the application of pertinent law
and precedent to a set of facts, such as tariff classification and applicable rate of duty.”
U.S. Shoe Corp. v. United States, 114 F.3d 1564, 1569 (Fed. Cir. 1997) (passive receipt
of a harbor maintenance tax by Customs constitutes a “charge or exaction,” but not a
“decision” pursuant to § 1514(a)). A “charge” is “an obligation or duty; a claim or
encumbrance; a liability, an expense or the price of an object; an entry in an account of
what's due from one party to another.” St. Paul Fire and Marine Ins. Co. v. United
States, 14 CIT 43, 46, 729 F. Supp. 1371, 1374 (1990) (citations omitted), rev’d on
other grounds, 959 F.2d 960 (Fed. Cir. 1992).
24 Pursuant to 19 U.S.C. § 1677g, the government is entitled to collect interest on
underpayment of amounts deposited on merchandise entered on or after the date on
which an antidumping order issues. The government is also entitled to so-called
“delinquency interest” pursuant to 19 U.S.C. § 1505(d). See AHAC (09-403), 100 F.
Supp. 3d at 1368-71.
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Court No. 15-00047 	Page 21
a 612 Report constitutes a protestable “charge” pursuant to § 1514(a)(3). See Hartford
Fire Ins. Co. v. United States, 31 CIT 1281, 1286, 507 F. Supp. 2d 1331, 1335–36
(2007), aff’d, 544 F.3d 1289 (Fed. Cir. 2008); Hartford Fire Ins. Co. v. United States,
Court No. 07-00101, Def.’s Mot. to Dismiss, Ex. A, ECF No. 13 (appending a “Formal
Demand on Surety for Payment of Delinquent Amounts Due,” i.e., a 612 Report, as
evidence of the charge at issue). Accordingly, Customs’ issuance of the 612 Report
triggered a 180 day period during which GAIC could have protested the underlying
reliquidation giving rise to the charge. See 19 U.S.C. §§ 1514(a)(3), (c)(3)(B); see also
Pope Prods., Div. of Purex v. United States, 15 CIT 279, 283 (1991) (demand for
payment begins the timeframe during which a surety may protest a liquidation).
To support the proposition that it “did not have to file a protest in order to raise
any and all defenses available to it in this collection action,” Defendant first relies on
United States v. Am. Home Assurance Co. (“AHAC (09-401)”), 39 CIT ___, ___,151 F.
Supp. 3d 1328, 1347-48 (2015). Def.’s Resp. at 14 (emphasis added). However,
Defendant misreads AHAC (09-401). There, the court distinguished “protestable
matters” related to the entries from “defenses related to [a surety’s] contractual
obligations,” for the purpose of determining whether the surety’s defenses were
preserved. AHAC (09-401), 151 F. Supp. 3d at 1347. To be sure, a surety is not barred
from raising contractual defenses in an enforcement action. St. Paul Fire & Marine Ins.
Co. v. United States, 959 F.2d 960, 963–64 (Fed. Cir.1992); AHAC (09-401), 151 F.
Supp. 3d at 1347. Here, however, Defendant’s arguments are not “personal” to the
surety’s obligations pursuant to the bond; rather, they concern Customs’ authority to
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Court No. 15-00047 	Page 22
reliquidate the subject entry beyond a specified timeframe. See DMSJ; cf. AHAC 09-
401, 151 F. Supp. 3d at 1346-48 (surety was not barred from arguing that it was
prejudiced by its failure to receive notice of the lifting of suspension); St. Paul Fire, 959
F.2d at 963–64 (surety’s claim that the government knew, but failed to timely disclose,
its awareness that the importer was evading customs laws, was “personal” to the surety
and “separate and distinct” from the importer’s protest). Defendant’s arguments against
liability constitute the type of “collateral[] challenge” to the validity of the reliquidation the
Federal Circuit has cautioned the exhaustion requirement of § 1514 was designed to
prevent. See Cherry Hill, 112 F.3d at 1557 (permitting sureties to “collaterally challenge
the liquidation” in a subsequent enforcement action “would create a gaping hole in the
administrative exhaustion requirement of section 1514 and would be inconsistent with
the underlying policy of section 1514, which is to channel challenges to liquidations
through the protest mechanism in the first instance”); cf. United States v. Utex Int’l Inc.,
857 F.2d 1408, 1414 (Fed. Cir. 1988) (permitting surety to defend against the
government’s demand for liquidated damages, occurring four years after final
liquidation, because the issue did not involve administrative review of the liquidation);
Cherry Hill, 112 F.3d at 1555 (construing Utex Int’l to be consistent with barring
challenges to the accuracy or validity of a liquidation when those challenges were not
protested administratively).
Defendant relies on Cherry Hill to support its alternative argument that it did not
have to file a protest raising a “deemed liquidation defense” to raise that same defense
in a subsequent enforcement action. Def.’s Resp. at 15-16 (citing Cherry Hill, 112 F.3d
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Court No. 15-00047 	Page 23
at 1550); see also Cherry Hill, 112 F.3d at 1558 (referring to the “deemed liquidation”
defense as a “narrower ground for reversal” than the argument that § 1514 exhaustion
was only required in the case of importer recovery suits and not government
enforcement actions). Cherry Hill held that because the subject “entry was liquidated by
operation of law prior to the October 28, 1988, liquidation, [the surety] was not required
to protest the October 28 liquidation in order to be entitled to defend against liability on
the ground of the deemed liquidation.” 112 F.3d at 1560. The Federal Circuit created
this exception to the protest requirement to prevent CBP from “purport[ing] to liquidate
an entry anew, years after the first liquidation had become final, and thereby impos[ing]
liability on the importer or surety if the importer or surety were not vigilant in watching for
notice of such untimely liquidations or if it were no longer able to undertake the burden
of filing and pursuing a protest.” Id.; see also United States v. Am. Home Assur. Co.
(“AHAC (Fed. Cir.)”), 789 F.3d 1313, 1321-22 (Fed. Cir. 2015) (discussing Cherry Hill).
Defendant’s reliance on Cherry Hill is misplaced.
First, Cherry Hill interpreted an older version of § 1501, which did not provide
for reliquidation of entries deemed liquidated pursuant to § 1504(d). 25 See Norsk Hydro
Can., Inc. v. United States, 472 F.3d 1347, 1362 n.26 (Fed. Cir. 2006). Accordingly, the
Federal Circuit reasoned that the deemed liquidation, and not the subsequent
25 19 U.S.C. § 1501 was amended in 2004 to allow for reliquidation of entries initially
liquidated pursuant to § 1504, i.e. deemed liquidations. See Miscellaneous Trade and
Technical Corrections Act of 2004, Pub. L. No. 108-429, §§ 2107, 2108, 118 Stat. 2434,
2598 (2004). Prior to 2004, only entries liquidated pursuant to §1500 could be
reliquidated by Customs.
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Court No. 15-00047 	Page 24
liquidation, “must [] be regarded as final” because the government had failed to
demonstrate grounds for treating the subsequent liquidation as a reliquidation and could
not simply liquidate the entry anew. See Cherry Hill, 112 F.3d at 1560 (noting, inter alia,
that “reliquidation under 19 U.S.C. § 1501 would not be permitted because that
provision applies only to liquidations made in accordance with 19 U.S.C. § 1500, and
not to ‘deemed liquidations’ under 19 U.S.C. § 1504”). That reasoning, and, thus,
Defendant’s reliance on Cherry Hill is inapposite in light of the changes to § 1501
affording Customs the authority to reliquidate deemed liquidations made pursuant to
§ 1504. See Norsk Hydro, 472 F.3d at 1362 n.26 (recognizing that “deemed
liquidations are subject to reliquidation”).
Defendant argues, however, that post-2004 cases “continue to recognize the
validity of Cherry Hills’ [sic] holding on [this] point.” Def.’s Resp. at 15 (citing Int’l
Custom Prod., Inc. v. United States, 791 F.3d 1329, 1339-40 (Fed. Cir. 2015), AHAC
(Fed. Cir.), 789 F.3d at 1322, and Ford Motor Co. v. United States, 35 CIT ___, ___,
806 F. Supp. 2d 1328, 1335 (2011)). The dates of the opinions are irrelevant; each
case involves pre-December 3, 2004 entries of merchandise, did not address the
relevant statutory scheme, or is otherwise inapposite. 26 Accordingly, Defendant’s
reliance on these cases is misplaced.
26 Int’l Custom Products addressed the applicability of the deemed liquidation defense to
Customs’ purported liquidation in 2007 of 13 entries that had entered between October
2003 and October 2004. Int’l Custom Prod., 791 F.3d at 1333-34. The Federal Circuit
relied on Cherry Hill to find that the importer could defend against a purported untimely
liquidation in an enforcement action without first having to file a protest. Id. at 1340-41
(citing Cherry Hill, 112 F.3d at 1561). In AHAC (Fed. Cir.), the court rejected the
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Second, Defendant has not actually raised the “deemed liquidation defense” to
liability contemplated in Cherry Hill. Defendant interprets the “deemed liquidation
defense” to mean that a surety does not have to file a protest whenever the original
liquidation was by operation of law, but that stretches the defense too far. See Def.’s
Resp. at 15-17. As discussed above, Cherry Hill permitted a surety to raise the defense
that the subject entry had already deemed liquidated, without first filing a protest, when
Customs purported to liquidate (as opposed to reliquidate) the entry anew, and treat
that liquidation as the operative liquidation. See Cherry Hill, 112 F.3d at 1560. But that
is not what happened here, nor is the mere fact that the entries had deemed liquidated
prior to the reliquidation the basis of Defendant’s defense to liability. See DMSJ
(generally contending that Customs waited too long before conducting its statutorily
surety’s attempt to assert a deemed liquidated defense pursuant to Cherry Hill to
several 2001 entries that Customs timely liquidated in 2004 and subsequently
reliquidated in 2005, because the entries had not been deemed liquidated. 789 F.3d at
1315-33. Ford Motor Co. addressed pre-December 3, 2004 drawback entries that
“Customs had not affirmatively liquidated when the action commenced on September 2,
2009.” Ford Motor Co., 806 F. Supp. 2d at 1331. In determining whether the court had
jurisdiction to hear the case, the court relied on Cherry Hill for the proposition, made in
passing, that “the importer [could] wait for Customs to affirmatively liquidate, decline to
pay whatever amount it is billed, and then assert an affirmative defense of deemed
liquidation if the United States brings an enforcement action under 28 U.S.C. § 1582.”
Id. at 1335 (citing, inter alia, Cherry Hill, 112 F.3d at 1560). Additionally, when, as in
that case, Customs had not affirmatively liquidated the entries, “the importer [could]
bring an action under 28 U.S.C. § 1581(i) to obtain a declaratory judgment from the CIT
confirming that there was a deemed liquidation.” Id. at 1335 (internal quotation marks
and citations omitted); id. at 1337 (noting that “Plaintiff's allegations also suggest [the
same] ‘potential for abuse’ [that concerned the Cherry Hill court] that only a declaratory
judgment could prevent”). Neither Int’l Custom Products, AHAC (Fed. Cir.), nor Ford
Motor Co. relied on Cherry Hill to permit the assertion of a deemed liquidation defense
to challenge a statutorily authorized reliquidation of post-December 3, 2004 entries.
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Court No. 15-00047 	Page 26
authorized reliquidation of the subject entry that were previously deemed liquidated).
Thus, Cherry Hill does not resolve Defendant’s arguments. In sum, Defendant’s
challenges to liability involve matters that are subsumed by the reliquidation and, thus,
could and should have been raised administratively. Because they were not, Defendant
is foreclosed from raising those arguments in this action.
B. 	Law of the Case
Plaintiff argues that the court’s prior interpretation of the relevant statutory
scheme constitutes the law of the case and, thus, Defendant’s contrary arguments
should not be revisited. Pl.’s Mem. in Opp’n to Def.’s Mot. for Summ. J. (“Pl.’s Resp.”)
at 4-6, ECF No. 61; Pl.’s Reply at 2. 27 Defendant contends that a 2016 amendment to
19 U.S.C. § 1501 merits the court’s reconsideration of its arguments. GAIC Reply in
Supp. of Def.’s, GAIC, Mot. for Summ. J. (“Def.’s Reply”) at 1-2, ECF No. 58.
a. 	Legal Framework
The law of the case doctrine “generally bars retrial of issues that were previously
resolved.” Intergraph Corp. v. Intel Corp., 253 F.3d 695, 697 (Fed. Cir. 2001) (citing
Messenger v. Anderson, 225 U.S. 436, 444 (1912) (law of the case “expresses the
practice of courts generally to refuse to reopen what has been decided”)). The
doctrine's purpose is to “promote[ ] the finality and efficiency of the judicial process by
protecting against the agitation of settled issues.” Christianson v. Colt Indus. Operating
27 The electronic docket numbers for Plaintiff’s response and reply are not sequential
due to Plaintiff’s refiling of its response as a public document. See Order (Feb. 21,
2017), ECF No. 59 (granting Plaintiff’s motion for errata to replace certain docket
entries).
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Corp., 486 U.S. 800, 816 (1988) (citation and internal quotation marks omitted).
However, it is well settled that the application of the doctrine is within a court's
discretion, and it “should not be applied woodenly in a way inconsistent with substantial
justice.” Hudson v. Principi, 260 F.3d 1357, 1363–64 (Fed. Cir. 2001) (citations omitted).
Courts may decline to apply the doctrine upon “the discovery of new and different
material evidence that was not presented in the prior action” or “an intervening change
of controlling legal authority,” or when “the prior decision is clearly incorrect and its
preservation would work a manifest injustice.” Intergraph Corp., 253 F.3d at 698.
b. Analysis
Defendant contends that an amendment to § 1501 that took effect on February
24, 2016 applies to entries that entered before that date, or, alternatively, that the
amendment constitutes a change in the controlling law meriting reconsideration of
Defendant’s prior argument that Congress intended to limit CBP’s ability to reliquidate
entries previously deemed liquidated to within 90 days of the date of the deemed
liquidation. Def.’s Reply at 2. In other words, Defendant contends that the 2016
amendment supports its interpretation of the 2004 version of § 1501 in effect when the
subject entries were made. See id. Defendant is wrong on both counts. 28
28 As previously noted, 19 U.S.C. § 1501 was amended in 2004 to allow for reliquidation
of deemed liquidations. See supra note 25. Because the events of this case all took
place after 2004, it is the 2004 version of the statute that governs Customs ability to
liquidate and reliquidate the entries in question.
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i. 	Overview of the 2016 Amendment
On February 24, 2016, Congress amended § 1501 as follows:
A liquidation made in accordance with section 1500 or 1504 of this title or
any reliquidation thereof made in accordance with this section may be re-
liquidated in any respect by the Customs Service U.S. Customs and
Border Protection, notwithstanding the filing of a protest, within ninety
days from the date on which notice of the original liquidation is given or
transmitted to the importer, his consignee or agent of the original
liquidation. Notice of such reliquidation shall be given or transmitted in the
manner prescribed with respect to original liquidations under section
1500(e) of this title.
Trade Facilitation and Enforcement Act of 2015, Pub. L. No. 114-125, § 911, 130 Stat.
122, 240 (2016) (deletions in strikethrough; additions underlined). In sum, the statute
now requires Customs to voluntarily reliquidate affirmative and deemed liquidations
within 90 days from the date of the liquidation, not the date on which notice is provided.
See id.
ii. 	The Amendment is Not Retroactive
The U.S. Supreme Court has recognized that “the presumption against
retroactive legislation is deeply rooted in our jurisprudence,” because “individuals should
have an opportunity to know what the law is and to conform their conduct accordingly . .
. .” Landgraf v. USI Film Products, 511 U.S. 244, 265 (1994). However, this
presumption is not absolute: “[r]etroactivity provisions often serve entirely benign and
legitimate purposes,” including correcting mistakes. Id. at 267-68. Accordingly, the
Court has established a framework to determine whether a statute applies retroactively.
See Fernandez-Vargas v. Gonzales, 548 U.S. 30, 37 (2006) (“This Court has worked
out a sequence of analysis when an objection is made to applying a particular statute
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Court No. 15-00047 	Page 29
said to affect a vested right or to impose some burden on the basis of an act or event
preceding the statute’s enactment.”).
First, a court must look to “whether Congress has expressly prescribed the
statute’s proper reach.” Id. at 37 (citing Landgraf, 511 U.S. at 280). Absent such
language, a court should “try to draw a comparably firm conclusion about the temporal
reach specifically intended by applying ‘[the court’s] normal rules of construction.’” Id.
(citing Lindh v. Murphy, 521 U.S. 320, 326 (1997)). If both efforts fail, a court asks
whether the statute has impermissible “retroactive consequence,” defined as an
application of the statute that “‘affect[s] substantive rights, liabilities, or duties [on the
basis of] conduct arising before [its] enactment.’” Id. (citing Landgraf, 511 U.S. at
278). 29 To determine whether a statute has retroactive consequence, the court must
consider three Landgraf factors: “the ‘nature and extent of the change of the law,’ ‘the
degree of connection between the operation of the new rule and a relevant past event,’
and ‘familiar considerations of fair notice, reasonable reliance, and settled
expectations.’” Princess Cruises, Inc. v. United States, 397 F.3d 1358, 1364 (Fed. Cir.
2005) (quoting Landgraf, 511 U.S. at 270). 30
29 There is a distinction between “retroactive consequence,” which is impermissible, and
applying a statute “retroactively,” which may be permissible. See Landgraf, 511 U.S. at
269-70 (“The conclusion that a particular rule operates ‘retroactively’ comes at the end
of a process of judgment concerning the nature and extent of the change in the law and
the degree of connection between the operation of the new rule and a relevant past
event.”).
30 Neither party has addressed the Landgraf factors the court is required to consider
pursuant to Princess Cruises; instead, Parties dispute the proper application of Landgraf
as construed by the Court of Appeals for the Ninth Circuit in Chenault v. U.S. Postal
Service, 37 F. 3d 535, 538 (9th Cir. 1994). See DMSJ at 19; Pl.’s Resp. at 21-22; Def.’s
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In this case, § 1501 (as amended in 2016) does not expressly state the statute’s
temporal applicability. See 19 U.S.C. § 1501 (2016). Nor do the “normal rules of
[statutory] construction” suggest a “comparably firm” determination “about the [statute’s]
temporal reach.” Fernandez-Vargas, 548 U.S at 37 (citing Lindh, 521 U.S. at 326).
Defendant relies on legislative history associated with the 2016 amendment to support
retroactivity. Def.’s Reply at 5 (quoting 162 Cong. Rec. S836-02 (daily ed. Feb. 11,
2016) (statements of Senators Hatch and Wyden)); see also DMSJ at 17 n.5. In the
floor debate relied on by Defendant, Senators Hatch and Wyden had the following
exchange:
Mr. HATCH:
Madam President, the bill we will be voting on shortly contains a provision
amending 19 U.S.C. § 1501, which relates to the liquidation of entries into
the U.S. The provision in the conference report amending section 1501 is
intended to ensure in cases where liquidation occurs by operation of law,
the 90-day timeframe for the voluntary reliquidation of an entry by
Customs and Border Protection begins on the date of the original
liquidation. I would ask my colleague, Senator Wyden, the ranking
member of the Finance Committee, if that is his understanding of this
provision as well.
Mr. WYDEN:
Madam President, I agree with Senator Hatch that is the intent of the
provision amending 19 U.S.C. § 1501.
162 Cong. Rec. S836-02 (daily ed. Feb. 11, 2016) (statements of Senators Hatch and
Wyden) (emphasis added). According to Defendant, Senator Hatch’s use of the
phrasing “intended to ensure” was “obviously meant to clarify that Congress intended
Reply at 5. However, the Federal Circuit, not the Ninth Circuit, is binding on the court
and the court applies the legal framework as stated in Princess Cruises.
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the 90-day timeframe in the 2004 amendment to also begin on the date of the original
liquidation.” Def.’s Reply at 5 (underline omitted). To the contrary, Senator Hatch’s
statement simply discusses the effect of the 2016 amendment; it falls far short of a
“comparably firm” statement of the amended statute’s temporal reach. See Fernandez-
Vargas, 538 U.S. at 37; Pl.’s Resp. at 20 (“Plainly, the Congressmen were discussing
the intent of the amendment that result[ed] in the current statute, not the intent of the
prior version.”). Accordingly, the court must proceed to the third step of the analysis—
consideration of the Landgraf factors.
First, the “nature and extent of the change of the law” is significant because the
amendment changes the starting point for computing the time that CBP has to
voluntarily reliquidate an entry from the date of notice to the date of the liquidation. See
Princess Cruises, 397 F.3d at 1364. Particularly in the context of deemed liquidations,
this is significant because those two dates do not necessarily (or even likely) coincide.
See 19 C.F.R. § 159.9(c)(ii) (affording Customs “a reasonable period after each
liquidation by operation of law” to provide notice); cf. Koyo Corp. of U.S.A. v. United
States, 497 F.3d 1231, 1240 (Fed. Cir. 2007) (recounting Customs’ posting of bulletin
notices more than 12 months after the subject entries had been deemed liquidated).
Second, there is a strong “degree of connection between operation of the new
rule and a relevant past event.” See Princess Cruises, 397 F.3d at 1364. Applying the
2016 amendment to the reliquidation at issue here, which occurred within 90 days of
notice but not within 90 days of the deemed liquidation, would void the reliquidation and
result in the under-collection of antidumping duties. See supra Background Sect. I.D;
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cf. Princess Cruises, 397 F.3d at 1366 (noting that retroactive application of the rule in
question would result in plaintiff being overcharged).
Finally, “familiar considerations of fair notice, reasonable reliance, and settled
expectations” also disfavor retroactive application. See Princess Cruises, 397 F.3d at
1366-67. 31 As the Federal Circuit recognized more than a decade ago, § 1501 plainly
afforded Customs 90 days from the date on which it posted the bulletin notice to
reliquidate the subject entry. See Norsk Hydro, 472 F.3d at 1352. To now hold
otherwise implicates fairness and reliance considerations. Cf. Princess Cruises, 397
F.3d at 1364, 1366 (receipt of a letter from a Customs official indicating that Plaintiff
would not be subject to harbor maintenance tax for layover-only passengers disfavored
retroactive application of a contrary Customs ruling). In sum, because all three
Landgraf factors points to an impermissible retroactive effect, CBP’s “substantive rights,
liabilities, or duties” would be negatively affected by applying the 2016 amendments to
the facts of this case. See Fernandez-Vargas, 548 U.S at 37; Princess Cruises, 397
F.3d at 1367. Thus, the court must “apply the presumption against retroactivity . . .
owing to the absen[ce of] a clear indication from Congress that it intended such a
result.” Fernandez-Vargas, 548 U.S. at 37–38 (internal quotation marks and citation
omitted).
31 The Federal Circuit declined to resolve the issue of the relative weight to be given to
this factor because all three Landgraf factors pointed to the same conclusion. Princess
Cruises, 397 F.3d at 1366. The court also need not resolve the issue of weight because
the factors also point to the same conclusion.
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As to Defendant’s alternative argument--that the amendment supports its
interpretation of § 1501 circa 2004--in fact, the opposite is true. See Def.’s Reply at 2.
Congress’ amendment to the statute demonstrates that starting the period for
reliquidation at the notice of the deemed liquidation is substantively different from
starting it at the date on which the entry liquidated by operation of law, otherwise there
would be no reason to amend the statute. Absent evidence that Congress intended the
2016 amendment to § 1501 to apply retroactively, the court is guided by the plain
language of the statute in effect when the subject entries were made. See Conn. Nat’l
Bank v. Germain, 503 U.S. 249, 253-54 (1992) (“We have stated time and again that
courts must presume that a legislature says in a statute what it means and means in a
statute what it says there.”) (citations omitted). Defendant already has raised, and the
court has rejected, the argument that the timeframe for voluntary reliquidation begins on
the date of the deemed liquidation. See Def.’s MTD; Great American Ins. Co. of New
York, 121 F. Supp. 3d at 1295 (“[T]he statute is clear that it is the date the notice was
transmitted that starts the clock on reliquidation and Customs has 90 days from the date
the notice of deemed liquidation is transmitted to reliquidate the entry.”) (citing Norsk
Hydro, 472 F.3d at 1352 (“Customs may sua sponte reliquidate an entry, including an
entry ‘deemed liquidated,’ within 90 days of its giving notice of the original liquidation to
the importer.”)). For that reason, the court declines to reconsider Defendant’s
arguments regarding statutory interpretation. The issue that remained unresolved at the
motion to dismiss stage, and to which the court now turns, is whether Customs posted
the bulletin notice “within a reasonable period.” See 19 C.F.R. § 159.9(c)(ii).
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II. 	Whether Customs Posted the Bulletin Notice Within a Reasonable Time
Plaintiff moves for summary judgment on the grounds that the ten month period
between the date of the deemed liquidation and the date on which it posted the bulletin
notice is reasonable, particularly in light of Orleans Furniture’s misidentification of the
applicable Commerce case number on the Entry Summary. See PMSJ at 9-12.
Defendant responds that 90 days from the date of the deemed liquidation constitutes
“[a] reasonable time” within which CBP must post a bulletin notice, Def.’s Resp. at 10,
and, further, that the ten month delay at issue in this case is unreasonable, see id. at 7-
10. 32
A. Legal Framework
As noted above, § 1501 provides that Customs may reliquidate a deemed
liquidation “within ninety days from the date on which notice of the original liquidation is
given or transmitted to the importer.” 19 U.S.C. § 1501. Although Congress predicated
reliquidation on Customs’ provision of notice of the deemed liquidation, Congress has
32 Defendant also argues that the reasonableness of the time period must be measured
from June 23, 2009, when it contends Customs learned of the importer’s error. Def.’s
Resp. at 8. As discussed supra note 12, Defendant’s contention is speculative.
Defendant appears to confuse the issue left open after the court denied its motion to
dismiss as whether “Customs reliquidate[d] within a reasonable period,” which is distinct
from whether Customs posted the bulletin notice within a reasonable period. See DMSJ
at 26-28. Defendant contends that if the court does not find 90 days to constitute a
reasonable period, it should find that a reasonable period cannot, as a matter of law,
exceed six months from the date of the deemed liquidation. See id. at 26-28.
Reasonableness, however, is fact specific; thus, it would be improper for the court to
read into the governing regulation an arbitrary bright-line temporal rule. Moreover,
Defendant’s argument is simply another variation of its core argument that the date of
the deemed liquidation triggers the time in which CBP may reliquidate the subject entry,
which the court has rejected.
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Court No. 15-00047 	Page 35
not, however, mandated that Customs must, in all cases, provide notice of the deemed
liquidation. See id. § 1504(a)(1) (“Notwithstanding section 1500(e) of this title, notice of
liquidation need not be given of an entry deemed liquidated.”); see also id. § 1500(e)
(instructing Customs “to give or transmit” notice of liquidation “in such form and manner
as the Secretary shall by regulation prescribe”). Consequently, there is a gap in the
statutory scheme because it provides for reliquidation within 90 days of notice that may,
or may not, be given. Customs’ regulations fill that gap by requiring the posting of a
bulletin notice to provide notice of entries liquidated by operation of law. See 19 C.F.R.
§ 159.11 (“Notice of liquidation will be given on a bulletin notice of liquidation . . . as
provided in §§ 159.9 and 159.10(c)(3).”) (emphasis added); 33 see also Contreras v.
United States, 215 F.3d 1267, 1274 (Fed. Cir. 2000) (“An agency that has been granted
authority to promulgate regulations necessary to the administration of a program it
oversees may fill gaps in the statutory scheme left by Congress if it does so in a manner
that is consistent with the policies reflected in the statutory program.”); New England
Tank Industries of New Hampshire, Inc. v. United States, 861 F.2d 685, 694 (Fed. Cir.
1988) (referring to the term “will” as it appears in an agency regulation as a “mandatory
term”) (citations omitted). Customs must post the bulletin notice of liquidation in the
33 Strictly speaking, the text of 19 C.F.R. § 159.11 applies to entries that are liquidated
by operation of law because they are not liquidated within one year from the date of
entry; the regulation does not refer to entries that CBP has failed to liquidate within six
months of receiving notice that a statutory or court-ordered suspension has been
removed. See 19 C.F.R § 159.11. However, pursuant to 19 U.S.C. § 1504, entries
within that latter category are treated the same as entries within the former category;
i.e., they are deemed liquidated. See 19 U.S.C. § 1504(a),(d). Accordingly, 19 C.F.R.
§ 159.11, which governs deemed liquidations, applies.
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customhouse “within a reasonable period after each liquidation by operation of law and
[it] shall be dated as of the date of expiration of the statutory period.” 19 C.F.R.
§ 159.9(c)(2)(ii).
B. Analysis
Parties agree that Customs reliquidated the entry on January 8, 2010, within 90
days of Customs’ December 18, 2009 posting of the bulletin notice. See PSOF ¶ 33;
Def.’s Resp. to PSOF; DSOF ¶¶ 8-9; Pl.’s Resp. to DSOF ¶¶ 8-9. Thus, the remaining
issue is whether Customs posted the bulletin notice “within a reasonable period” after
the subject entry was deemed liquidated on February 20, 2009.
Here, Customs’ delay in posting the bulletin notice is largely attributable to the
importer’s erroneous identification on the Entry Summary of the Gaomi Yatai-specific
Commerce case number, A-570-890-101, which led Customs to treat it as if liquidation
had been suspended pursuant to the TRO and preliminary injunction issued in
American Signature. See supra Background Sect. A-C. It was not until September 30,
2009 that a Customs official, Mr. Gerace, learned that the exporter was Company X, not
Gaomi Yatai, that Company X was subject to the China-wide rate, that publication of the
August 20, 2008 Final Results had lifted the suspension of liquidation of the subject
entry, and that the subject entry had therefore liquidated by operation of law on
February 20, 2009. See supra Background Sect. D. This September 30 discovery
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prompted Customs to process the entry and post the bulletin notice two and a half
months later, on December 18, 2009. See id.34
Defendant seeks to apply Utex Int’l to support its contention that “it does not
matter if a mistake was made or who made the mistake, once an entry is liquidated and
not reliquidated within 90 days, it is final and conclusive to everyone[,] including the
government.” Def.’s Resp. at 7-8 (citing Utex Int’l, 857 F.2d at 1408). The Federal
Circuit decided Utex Int’l before the 2004 amendments to § 1500 providing for voluntary
reliquidation of deemed liquidations. See supra note 25. Further, as Plaintiff
recognizes, Utex Int’l “simply identifie[s] the well-established principle that ‘the statutory
procedures of liquidation, reliquidation, and timely protest control the finality of the
importation process,’” and that “‘absent timely reliquidation or protest,’” liquidation is
final and conclusive. Pl.’s Resp. at 7 (quoting Utex Int’l, 857 F.2d at 1411, 1412). Utex
Int’l does not speak to the reasonableness of the timeframe within which Customs must
post a bulletin notice; thus, it does not support Defendant’s position.
Defendant also contends that focusing on the importer’s error “is nothing more
than a post-hoc attempt to justify CBP[’s] own negligence” because the Entry Summary
otherwise identifies Company X by name and manufacturer identification number.
Def.’s Resp. at 11. “At best, . . . the documents submitted by the importer . . . were
internally inconsistent.” Pl.’s Reply at 9. However, Defendant does not dispute the
34 Defendant attempts to dispute the reasonableness of the time CBP needed to
process the entry by comparing it to the 15 days afforded to a customs broker to
prepare entry paperwork. Def.’s Resp. at 9 & n.4 (citing 19 C.F.R. § 141.5).
Defendant’s attempt to compare apples and oranges fails to persuade.
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Court No. 15-00047 	Page 38
importer’s error or otherwise offer evidence demonstrating that CBP knew the identity of
the exporter before September 30, 2009. See supra note 12. Further, the importer is
responsible for using “reasonable care” when “complet[ing] the entry” so that Customs
may “properly assess duties,” and must certify that the information is “true and correct.”
19 U.S.C. § 1484(a)(1)(B), (d)(1). In sum, although case law is scant on what
constitutes reasonableness for purposes of 19 C.F.R. § 159.9(c)(2)(ii), reasonableness
is an inherently fact-specific inquiry. Based on the foregoing facts, the court finds that
Customs posted the bulletin notice “within a reasonable period.” Cf. Koyo Corp., 497
F.3d at 1238 (quoting 19 C.F.R. § 159.9(c)(2)(i)-(ii)).
III. 	Status of Administrative Proceedings
Defendant argues that “[i]f, and only if, the [c]ourt finds the CBP reliquidation was
valid, then we submit that the case has not been decided administratively.” DMSJ at
31. Defendant appears to contend that because Orleans Furniture’s protest concerned
the scope of the relevant AD order, Customs should have referred the matter to
Commerce for a scope determination; because it did not, the issue remains unresolved,
“any action (or non-action) by CBP on the protest was an ultra vires determination,” and
the protest could not have been deemed denied. Id. at 31-34; see also id. at 33 (“There
cannot be a deemed denial of an accelerated disposition for an issue CBP had no legal
right to determine.”). Plaintiff contends the administrative proceedings are complete.
Pl.’s Resp. at 15-18.
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A. Legal Framework
In antidumping administrative proceedings, scope issues may be resolved in one
of two ways. First, an “interested party” may seek a ruling from Commerce clarifying
“whether a particular product is within the scope of an [antidumping duty] order.” 19
C.F.R. § 351.225(c)(1); Sandvik Steel Co. v. United States, 164 F.3d 596, 599–600
(Fed. Cir. 1998) (reviewing Commerce’s “detailed scope determination procedures”). 35
Such scope rulings are subject to judicial review by this court. See 19 U.S.C.
§ 1516a(a)(2)(B)(vi). Alternatively, when the scope of an order is clear, an importer may
protest Customs’ determination that a product is within the scope of the order pursuant
to 19 U.S.C. § 1514(a)(2), and subsequently challenge any protest denial before this
court. See Xerox Corp. v. United States, 289 F.3d 792, 794-95 (Fed. Cir. 2002)
(holding that an importer need not have sought a scope ruling from Commerce when
“the scope of the order [was] not in question” because the importer had asserted that
the subject merchandise was “facially outside the scope of the [order]”; distinguishing
Sandvik Steel in which “importers should have sought scope rulings from Commerce . .
. because . . . it was unclear whether the goods at issue were within the scope of [the]
orders”); cf. Sunpreme Inc. v. United States, 40 CIT ___, ___,145 F. Supp. 3d 1271,
1285 (2016) (CBP “acts beyond its authority” when it “attempts to determine whether a
product falls within the scope based upon factual information that the scope language
does not explicitly call on CBP to consider.”).
35 Commerce may also self-initiate an inquiry into whether a product is within the scope
of an order. 19 C.F.R. § 351.225(b).
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B. Analysis
Defendant contends that Customs should have obtained a scope ruling from
Commerce because it was unclear “whether . . . the items were within the scope of the
[AD] order.” See DMSJ at 32. Defendant asserts that, “[i]n the protest, [Orleans
Furniture] reminded CBP that the [subject] merchandise . . . [constituted] posts and not
finished bedroom furniture.” Id.; see also Def.’s Reply at 9 (the importer’s protest “put
CBP on notice that [the importer] was contesting the fact that the merchandise . . . was
not covered by the [AD order]”). 36
Here, Orleans Furniture timely protested Customs’ reliquidation and therein
requested accelerated disposition. See PSOF ¶ 37; Def.’s Resp. to PSOF. Pursuant to
§ 1515(b), "a protest which has not been allowed or denied in whole or in part within
thirty days following the date of mailing by certified or registered mail of a request for
accelerated disposition shall be deemed denied." 19 U.S.C. § 1515(b); see also 19
C.F.R. § 174.22(d) (governing deemed denials of protests for which accelerated
disposition had been sought). The Parties agree that Orleans Furniture requested
36 Defendant relies on Sunpreme to support its argument that Commerce, not CBP, is
responsible for making scope determinations. See DMSJ at 32-34; Def.’s Reply at 10.
Defendant’s reliance is misplaced. As noted above, in Sunpreme, the court found that
CBP “acts beyond its authority” when it “attempts to determine whether a product falls
within the scope based upon factual information that the scope language does not
explicitly call on CBP to consider.” 145 F. Supp. 3d at 1285. That case, however, arose
as a result of Customs’ affirmative determination that the scope of the relevant order
covered the subject merchandise, and the court relied on its residual jurisdiction,
pursuant to 28 U.S.C. § 1581(i), to review plaintiff’s challenge to CBP’s decision that the
subject merchandise was within the scope of the relevant order and, consequently, to
suspend liquidation and collect cash deposits on the entries. See id. at 1280-82, 1283-
92.
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accelerated disposition; absent evidence that Customs otherwise “allowed or denied
[the protest] in whole or in part,” there is no genuine dispute that Orleans Furniture's
protest was deemed denied and the administrative proceedings are, thus, complete.
See PSOF ¶ 38; Def.’s Resp. to PSOF ¶ 38; Anderson, 477 U.S. at 249. Whether
Customs properly applied the terms of the scope of the AD order to include Orleans
Furniture’s merchandise is no longer reviewable. That decision was made in the
context of the reliquidation. Defendant’s time to challenge that decision, through protest
and, if necessary, challenge to the denial of the protest, has passed. As discussed
above, supra Discussion Sect. I.A.b.ii, issues that were subsumed in the
liquidation/reliquidation are final and cannot be raised as a defense in this collection
action.
Based on the foregoing, the reliquidation and associated charges are “final and
conclusive.” Therefore, Defendant is liable to the Plaintiff for the $50,000 face value of
the bond.
IV. 	Plaintiff’s Entitlement to Interest
Plaintiff seeks statutory interest pursuant to 19 U.S.C. § 580 and equitable
interest. See PMSJ at 13-14; Compl.¶ 1. According to Plaintiff, statutory and equitable
interest should be calculated on the face value of the bond because the total amount of
antidumping duties, pre-liquidation interest, and delinquency interest due exceeds the
bond’s value. See Pl.’s Reply at 21. Plaintiff asserts, however, that the issue of
equitable interest should be held in abeyance pending the Federal Circuit’s
determination whether the government is entitled to equitable and statutory interest.
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See PMSJ at 13-14 (citing AHAC (09-403), 100 F. Supp. 3d at 1373 (declining to award
equitable interest in light of the government’s entitlement to § 580 interest), appeal
docketed, Nos. 16-1088, 16-1090 (Fed. Cir. Oct. 20, 2015); 37 United States v. Am.
Home Assur. Co. (“AHAC (10-185)”), 39 CIT ___, ___, 102 F. Supp. 3d 1376, 1380
(2015) (same), appeal docketed, No. 16-1258 (Fed. Cir. Nov. 30, 2015)); 38 Pl.’s Reply
at 20. Defendant does not dispute Plaintiff’s entitlement to statutory interest. See Def.’s
Resp. at 17-20. Defendant contends that Plaintiff is not entitled to equitable interest,
and the court should adjust any award of statutory interest by a “negative ‘equitable pre-
judgment interest’” amount. Id. at 19. Defendant further contends that interest should
be calculated on the amount of antidumping duties due, 39 not the $50,000 face value of
the bond, and that interest began to accrue on December 15, 2014. Id. at 18, 20. 40
A. Statutory Interest
The government is entitled to collect statutory interest “at the rate of [six] per
centum a year,” 19 U.S.C. § 580, on all “bonds securing the payment of antidumping
duties when the government sues for payment under those bonds,” AHAC (Fed. Cir.),
37 The Federal Circuit heard oral argument on this appeal on February 9, 2017. See
AHAC (09-403), No. 16-1088, Docket Entries 63, 66.
38 The Federal Circuit heard oral argument on this appeal on April 7, 2017. See AHAC
(10-185), No. 16-1258, Docket Entries 60, 63.
39 This amount is [[ 	]]. Def.’s Resp. at 20; Pl.’s Reply at 21.
40 Defendant also contends that “interest starts to run from the time Commerce issues
its scope determination” regarding whether the subject entries are covered by the
relevant AD order. Def.’s Resp. at 18. As discussed supra Discussion Sect. III,
Defendant’s scope-related arguments lack merit.
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789 F.3d at 1325. Interest is calculated “from the time when said bonds became due.”
19 U.S.C. § 580.
Here, the “bonds became due” on April 27, 2010, the date Customs issued to
Defendant the 612 Report. See 612 Report (titled “Formal Demand on Surety for
Payment of Delinquent Amounts Due”); 19 U.S.C. § 580. Thus, interest began to
accrue on that date, and runs until the court issues judgment on liability. See AHAC
(10-185), 102 F. Supp. 3d at 1379 (§ 580 interest accrues from the date Customs first
demanded payment until the date of the court’s judgment on liability).
Defendant’s contention that interest should instead accrue from December 15,
2014, the date on which Customs sent it a demand letter, and not the earlier date on
which Customs issued the 612 Report because the 612 Report noted there was an
open protest, is unavailing. A surety’s “payment obligation runs independently of the
protest proceedings.” United States v. Ataka America, Inc., 17 CIT 598, 607, 826 F.
Supp. 495, 503 (1993) (regardless of whether “protest proceedings are pending,” a
surety “owes the duties and in the absence of other defenses, breaches its bond if it
does not pay in accordance with its obligation”). Moreover, as noted above, supra note
17, the 612 Report recognized that the deadline for ruling on the protest had passed.
See 612 Report.
Defendant’s contention that interest accrues on the amount of antidumping duties
owed, and not the face value of the bond, also lacks merit. Pursuant to 19 U.S.C.
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§ 1677g, 41 the government is entitled to collect interest on underpayment of amounts
deposited on merchandise entered on or after the date on which an antidumping order
issues. Thus, § 1677g interest accrues on the difference between the cash deposit paid
by Orleans Furniture 42 and the liquidated amount. 43 The government is also entitled to
delinquency interest pursuant to 19 U.S.C. § 1505(d). 44 Because the sum total of the
principal, § 1677g interest, and § 1505(d) interest exceeds the face value of the bond,
see PSOF ¶ 43; Def.’s Resp. to PSOF; 612 Report, § 580 interest is calculated on the
face value of the bond. Interest therefore ran on a liability amount of $50,000 from April
27, 2010 to the judgment date at a rate of six percent per annum.
B. Equitable Interest
Having found that the government is entitled to § 580 interest, as Plaintiff has
proposed, the court will defer its consideration of the appropriateness of an award of
equitable prejudgment interest, pending the Federal Circuit’s determination whether the
government is entitled to both. See supra Discussion Sect. IV. Deferring consideration
41 Section 1677g provides, inter alia, that “[i]nterest shall be payable on overpayments
and underpayments of amounts deposited on merchandise entered, or withdrawn from
warehouse, for consumption on and after . . . the date of publication of a countervailing
or antidumping duty order.” 19 U.S.C. § 1677g(a). The rate of interest is calculated
pursuant to 26 U.S.C. § 6621. 19 U.S.C. § 1677g(b). Pursuant to § 6621, the
“underpayment rate” is “the sum of . . . the Federal short-term rate determined under
subsection (b) [of § 6621], plus . . . 3 percentage points.” 26 U.S.C. § 6621(a)(2).
42 This amount is $[[ 	]]. PMSJ, Ex. 9.
43 This amount is $[[ 	]]. PMSJ, Ex. 9.
44 Pursuant to § 1505(d), delinquent “duties, fees, and interest . . . bear interest by 30-
day periods, at a rate determined by the Secretary, from the date of liquidation or
reliquidation until the full balance is paid.” 19 U.S.C. § 1505(d). When the 612 Report
issued, delinquency interest in the amount of $398.02 had accrued. See 612 Report;
Pl.’s Reply at 21.
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of this issue will not expose Defendant to additional interest because interest stops
accruing on the date the court enters judgment on liability. Cf. AHAC (10-185), 102 F.
Supp. 3d at 1379 n.2 (rejecting the government’s argument that interest accrues until
the court enters judgment following remand from the Federal Circuit). 45 And, as
discussed below, the court finds it appropriate to enter partial summary judgment
pursuant to USCIT Rule 54(b).
C. Partial Summary Judgment
The court has determined that Plaintiff is entitled to recover $50,000 in unpaid
antidumping duties and interest, which is the face value of the bond that GAIC issued,
plus statutory prejudgment interest. Nevertheless, Plaintiff proposes that the court
defers reaching the issue of its entitlement to equitable prejudgment interest. See
PMSJ at 13-14. Deferring the equitable interest issue without entering judgment as to
liability, however, could prejudice the Defendant by permitting additional interest to
accrue while the Federal Circuit resolves the issue in the two cases pending before it.
Accordingly, the court will treat Plaintiff’s request for equitable prejudgment interest as a
claim for relief that is separate from its claim for the value of the bond and statutory
interest, thereby enabling the court to enter partial summary judgment pursuant to
USCIT Rule 54(b).
45 The court need not reach Defendant’s argument that the court should adjust any
award of statutory interest by a “negative ‘equitable pre-judgment interest’” amount.
Def.’s Resp. at 19. In the event the Federal Circuit permits the award of equitable
interest in addition to the statutory interest awarded herein, Defendant is free to raise
any arguments it wishes regarding the possibility of overcompensation.
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As previously stated, Rule 54(b) provides that “[w]hen an action presents more
than one claim for relief . . ., the court may direct entry of a final judgment as to one or
more but fewer than all claims . . . only if the court expressly determines that there is no
just reason for delay.” USCIT Rule 54(b). “Rule 54(b) requires finality—‘an ultimate
disposition of an individual claim entered in the course of a multiple claims action.’”
United States v. Horizon Prods. Int’l, Inc., 39 CIT ___, ___, 91 F. Supp. 3d 1339, 1340
(2015) (quoting Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 436 (1956)). To
determine whether there is no just reason for delay, the court examines whether the
concern for avoiding piecemeal litigation is outweighed by considerations favoring
immediate entry of judgment. See id. (citing Timken v. Regan, 5 CIT 4, 6 (1983)).
Here, the United States seeks to recover the face value of the bond, statutory
prejudgment interest pursuant to 19 U.S.C. § 580, and equitable prejudgment interest.
The court has determined that Plaintiff is entitled to the face value of the bond and
statutory interest. There is nothing more for the court to decide in connection with those
claims; thus, the court has reached an “ultimate disposition” as to those claims.
Moreover, resolution of those claims do not bear on the court’s resolution of Plaintiff’s
claim to equitable prejudgment interest.
The entry of a Rule 54(b) judgment on Defendant’s liability and an award of
statutory interest while deferring the issue of equitable interest serves the interests of
both parties and the administration of justice because it tolls the accrual of prejudgment
interest and prevents an extraneous appeal of an issue the Federal Circuit is already
deciding. To the extent partial summary judgment gives rise to piecemeal litigation, i.e.,
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an appeal of these decided issues while the issue of equitable interest remains
unresolved, that concern is outweighed by the interest in tolling the accrual of
prejudgment interest, which favors the immediate entry of judgment. See Horizon
Prods. Int’l, 91 F. Supp. 3d at 1340-41 (fixing the amount of prejudgment interest favors
the entry of final judgment). Accordingly, the court finds that there is no just reason for
delay and will enter partial summary judgment pursuant to USCIT Rule 54(b). 46
CONCLUSION
For the reasons discussed above, the court will grant Plaintiff’s motion for
summary judgment, in part, and deny Defendant’s motion for summary judgment.
Judgment will be entered accordingly.
/s/ 	Mark A. Barnett
Mark A. Barnett, Judge
Dated: May 18, 2017
New York, New York
46 Entering judgment will, however, permit the accrual of statutory post-judgment
interest. See 28 U.S.C. § 1961(a) (“Interest shall be allowed on any money judgment in
a civil case recovered in a district court.”); Compl. ¶ 1 (seeking post-judgment interest).
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