The opinion
SLIP OP 11-93
UNITED STATES COURT OF INTERNATIONAL TRADE
ISAAC INDUSTRIES, INC.,
Plaintiff,
Before: Pogue, Chief Judge
Court No. 07-00178
v.
UNITED STATES,
Defendant.
OPINION
[Defendant’s motion for summary judgment is granted.]
Dated: August 2, 2011
Peter S. Herrick, PA (Peter S. Herrick) for Plaintiff Isaac
Indus.
Tony West, Assistant Attorney General; Barbara S. Williams,
Attorney in Charge, International Trade Field Office, Commercial
Litigation Branch, Civil Division, U.S. Department of Justice
(Edward F. Kenny); Sheryl A. French, Of Counsel, Office of
Assistant Chief Counsel, International Trade Litigation, U.S.
Bureau of Customs and Border Protection for Defendant United
States.
Pogue, Chief Judge: In this matter, Plaintiff Isaac
Industries (“Isaac”) seeks review of the Defendant United States
Customs and Border Protection Service’s (“Customs”) denial of
Isaac’s claims for drawback.1 Plaintiff filed drawback claims
1
A drawback is the refund of duty paid on an import that is
subsequently re-exported. 19 U.S.C. § 1313(a) (2006). Further
Court No. 07-00178 Page 2
and related protests during a transitional period within which
Customs closed the Drawback Center at the Port of Miami (“Miami
office”) and gradually transferred claim processing to the
Drawback Center at the Port of Los Angeles (“Los Angeles
office”). Plaintiff alleges that the Los Angeles office had no
authority to make drawback determinations denying its claims.
Before the court are Defendant’s motion for summary judgment
and Plaintiff’s cross-motion for a stay of the proceedings and
remand to the Miami office. The court has jurisdiction pursuant
to 28 U.S.C. § 1581(a).
After a brief review of relevant background and the standard
of review, the court will explain below that there is no genuine
dispute as to any material fact, Customs properly denied
Plaintiff’s drawback entries and protests, and Plaintiff’s
summons is untimely filed. Accordingly, Defendant’s motion for
summary judgment is granted.
BACKGROUND
Prior to July 2002, Isaac imported polyether polyol into the
United States, later re-exported it, and filed three separate
drawback entries2 (“entries”) for this merchandise with Customs’s
citations to Title 28 of the United States Code are to the 2006
edition.
2
Plaintiff filed AGK-4509025-7 on July 17, 2002; and AGK-
0613025-8 and AGK-1234567-6 on July 31, 2002. Def.’s Mot. Summ.
J. 2.
Court No. 07-00178 Page 3
Miami office.
Shortly thereafter, Customs adopted and published a final
rule announcing the planned closure, on July 23, 2003, of the
Miami office for processing drawback claims. Consolidation of
Customs Drawback Centers, 68 Fed. Reg. 3381, 3381 (Dep’t Treasury
Jan. 24, 2003). The rule promulgated a “phased-in” closure plan,
requiring the Miami office to continue processing unliquidated
claims for twelve months following the date of effective closure,
i.e., until July 23, 2004.3 Id. After July 23, 2004, the Miami
Office would forward all unprocessed claims to the Los Angeles
drawback center. Id. at 3383.
Customs ultimately denied all three of Isaac’s drawback
claims, on December 22, 2004, and, in a January 21, 2005 letter
from the Los Angeles office, notified Isaac of the denial and
liquidation of the three entries without any drawback. Letter
from John S. Beck to Isaac Industries, Jan. 21, 2005, ECF No. 39-
2 at 2 (“Drawback Denial Letter”). Furthermore, Customs posted a
bulletin notice, detailing the liquidation, at the Port of Miami
3
An initial error in the parties’ motions contended that
the Miami office closed in November 2004, which would have
extended its jurisdiction accordingly until November 2005. Pl.’s
Mot. Opp. Def.’s Mot. Summ. J. 2; Def.’s Mot. Summ. J. 3. Both
parties corrected the error in a conference call with the court
and agreed that the Miami Office closed on July 23, 2003.
Court No. 07-00178 Page 4
on February 5, 2005.4 Customs Bulletin Notice of Entries
Liquidated for February 4, 2005, ECF No. 39-2 at 14 (“Bulletin
Notice”).
On April 18, 2005, Plaintiff filed a protest of Customs’s
drawback denial. Protest No. 2704-05-100868 regarding Drawback
Entry No. AGK-4509025-7, AGK-0613025-8, and AGK-1234567-6, Apr.
18, 2005, ECF No. 39-2 at 16–18 (“First Protest”). Customs later
sent Isaac a letter stating that “[d]rawback protest[s] can no
longer be filed in the Miami Port. Please submit protest to a
port where drawbacks are filed.” Decl. of Peter S. Herrick, Jun.
8, 2005, ECF No. 42-2 at 11, (“Resolution Request”). The record
contains copies of Isaac’s protest forms stamped “Received” by
the Los Angeles Office. Pl.’s Mem. Opp. Def.’s Mot. Summ. J. 5;
First Protest 16. The Los Angeles office denied Isaac’s protest
on November 9, 2005, reasoning that the protest “had no support
and no amendment [was] received within 180 days.”5 First Protest
4
“The bulletin notice of liquidation will be posted for the
information of importers in a conspicuous place in the
customhouse at the port of entry . . . . This posting or lodging
will be deemed the legal evidence of liquidation. For electronic
entry summaries, the date of liquidation will be the date of
posting of the bulletin notice[.]” 19 C.F.R. § 159.9(b) - (c)(1)
(2011).
5
According to the relevant regulations, “[a] protest may be
amended at any time prior to the expiration of the period within
which the protest may be filed . . . . [It] may assert additional
claims pertaining to the administrative decision . . . relating
to the same category of merchandise that is the subject of the
protest.” 19 C.F.R. § 174.14(a) (2011).
Court No. 07-00178 Page 5
15-18.
Plaintiff commenced this action on May 24, 2007 to contest
the denial of its protests.6 Ct. Summons 1-2. Defendant moves
for summary judgment, claiming entitlement to judgment as a
matter of law because the court lacks jurisdiction over
Plaintiff’s untimely complaint.
STANDARD OF REVIEW
The court may grant a party’s motion for summary judgment
when “there is no genuine issue as to any material fact,” and
“the movant is entitled to judgment as a matter of law.” USCIT R.
56(c). Genuine issues entail “[m]aterial issues [that] arise
6
On April 18, 2006, a year after the first set of protests,
but before filing suit, Plaintiff filed a second set of protests,
this time with the Los Angeles office. Def.’s Mot. Summ. J. 4.
Customs denied this second set of protests on July 20, 2006,
stating that it was untimely filed. Protest No. 2704-06-101358
regarding Drawback Entry No. AGK-4509025-7 (Jul. 20, 2006);
Protest No. 2704-06-101359 regarding Drawback Entry No. AGK-
0613025-8 (Jul. 20, 2006); Protest No. 2704-06-101360 regarding
Drawback Entry No. AGK-1234567-6 (Jul. 20, 2006)(ECF No. 39-2 at
19-22). During this second round of protest evaluation, Isaac’s
counsel sent a June 5, 2006 letter to Customs, in which he
explained that he “did not file an amendment [during the original
protest evaluation] because [he] did not have the protest
number[.]” Letter from Peter S. Herrick to Port Director, Long
Beach Drawback Branch Office, June 5, 2006, ECF No. 39-2 at 24.
Plaintiff’s counsel further claimed that he had originally sought
the protest number via a June 7, 2005 letter, and in turn, now
requested “the opportunity to amend the protest.” Id. Customs
thus labeled the June 7, 2005 letter as a “§ 1520(c) claim,”
which it denied on January 19, 2007 as untimely filed. Letter
from John Beck, Drawback Specialist, U.S. Customs and Border
Protection, to Isaac Industries, Jan. 19, 2007, ECF No. 39-2 at
26–27); Def.’s Mot. Summ. J. 5. Isaac, however, does not rely on
or raise its second set of protests here.
Court No. 07-00178 Page 6
when ‘facts . . . might affect the outcome of the suit under
governing law[.]’” Trumpf Med. Sys., Inc. v. United States, __
CIT __, 753 F. Supp. 2d 1297, 1305 (2010) (citations omitted).
Whether jurisdiction exists is a question of law. See Sky
Techs. LLC v. SAP AG, 576 F.3d 1374, 1378 (Fed. Cir. 2009).
Plaintiff, “[the] party seeking the exercise of jurisdiction in
its favor[,] has the burden of establishing that . . .
jurisdiction exists.” Rocovich v. United States, 933 F.2d 991,
993 (Fed. Cir. 1991) (citing KVOS, Inc. v. Associated Press, 299
U.S. 269, 278 (1936)).
DISCUSSION
Plaintiff’s alleged issues of material fact
In opposing summary judgment, Plaintiff alleges four
disputed material facts: (1) its awareness of the drawback
authority transfer to Los Angeles; (2) the timing of the port of
Miami’s retention and transfer of jurisdiction; (3) the
controlling nature of Customs’s bulletin posting in Miami; and
(4) the location and timing of Plaintiff’s first set of protests.
Each is discussed, in turn, below.
First, Plaintiff claims that it was unaware of Customs’s
decision to close its Miami office, generating a “misleading”
process that culminated in this case. Pl.’s Mem. Opp. Def.’s
Court No. 07-00178 Page 7
Mot. Summ. J. 5-6.7 This argument is unavailing. “The
publication of rules . . . in the Federal Register gives legal
notice of their contents to those subject to, or affected by,
them, ‘regardless of actual knowledge . . . or of the hardship
resulting from innocent ignorance.’” Higashi v. United States,
225 F.3d 1343, 1349 (2000) (citing Federal Crop Ins. Corp. v.
Merrill, 332 U.S. 380, 385 (1947)).8 Isaac therefore cannot rely
on its unawareness of the Miami office’s planned closure to argue
that the Los Angeles office lacked jurisdiction over drawback
claims.
Plaintiff’s second factual contention asserts that the
Federal Register notice mandated that the Port of Miami would
retain drawback jurisdiction during the period in question.
Pl.’s Mem. Opp. Def.’s Mot. Summ. J. 6 (“the Port of Miami was to
retain unliquidated drawback entries until November, 2005, or
July, 2005"). This argument, however, relies on a flawed reading
of the Federal Register notice. The notice explicitly states
7
Because of this lack of awareness, Isaac argues, it filed
its protests with the Port of Miami, thereby leading Plaintiff to
allege that the Miami office, not the Los Angeles office, had
jurisdiction over its drawback claim. Pl.’s Mem. Opp. Def.’s
Mot. Summ. J. 5-6.
8
See also Cathedral Candle Co. v. U.S. Int’l Trade Comm’n,
27 CIT 1541, 1549 n.10, 285 F. Supp. 2d 1371, 1378 n.10 (2003)
(“[T]he publication of an item in the Federal Register
constitutes constructive notice of anything within that item”)
(citations omitted).
Court No. 07-00178 Page 8
that the Miami office would retain jurisdiction over all
unprocessed drawback claims for a year after its effective
closure date of July 23, 2003; after July 23, 2004, the Los
Angeles office would assume jurisdiction over all of the Miami
office’s unprocessed claims. Consolidation of Customs Drawback
Centers, 68 Fed. Reg. at 3381-83. Thus, Plaintiff erroneously
claims that the Miami office still had authority to assess
drawback claims through July or November 2005.9 It is clear that
at all times during the period in question,10 the Los Angeles
office had jurisdiction to assess drawback entries. See
Consolidation of Customs Drawback Centers, 68 Fed. Reg. at 3381-
83.
Plaintiff’s third contested factual issue turns on the
bulletin notice posted at the Port of Miami. Plaintiff contends
9
July 2005 represents an incorrect calculation based on the
original Federal Register notice, which effectively transferred
jurisdiction in July 2004. Consolidation of Customs Drawback
Centers, 68 Fed. Reg. at 3381-83; Pl.’s Mot. Opp. Def.’s Mot.
Summ. J. 2. The mention of November 2005 can be attributed to the
parties’ earlier erroneous assertion that the Miami office closed
in November 2004. See infra note 5 (highlighting the parties’
initial confusion over the Miami office’s actual closing date).
10
Plaintiff originally filed the claims with the Miami
office in 2002, when that office was still open, but Customs did
not make the drawback determination until the period from
December 22, 2004 to February 5, 2005, during which it denied
Plaintiff’s drawback entries, formally notified it of the denial
(with extensive documentation of the reasons), and then posted
the liquidation results. Bulletin Notice at 14; Drawback Denial
Letter at 2; Drawback Entry Forms at 3-14.
Court No. 07-00178 Page 9
that “Miami had the authority to act on these entries which it
did on February 5, 2005 by liquidating [them with] no change.”
Pl.’s Mem. Opp. Def.’s Mot. Summ. J. 3. While February 5, 2005
was the legal date of the liquidation, Plaintiff’s argument
builds upon a misunderstanding of this posting.11 Just because a
notice of liquidation is posted at a particular port does not
mean that the port itself possesses drawback authority. Granted,
Isaac filed its claims in Miami when the Miami office was still
open, but the claims were properly transferred, along with
jurisdiction, to Los Angeles.12 Therefore, the existence of a
Miami bulletin notice posting does not preclude the Los Angeles
office’s authority to review Plaintiff’s drawback claim. See 19
C.F.R. § 191.61; Consolidation of Customs Drawback Centers, 68
Fed. Reg. at 3381-83.
In Plaintiff’s fourth basis for its cross motion, it claims
that the Miami office should have made the drawback determination
because Isaac filed its protests with the Port of Miami on April
11
The bulletin must be posted at the customhouse at the
port of entry of the goods in question. 19 C.F.R. § 159.9(b). As
such, Customs was legally required to post the bulletin at the
Port of Miami because that is where the goods in question were
entered.
12
19 C.F.R. § 191.61(a)(2) also enables “[t]he port
director selecting the claim for verification [to] forward” the
claim “to other drawback offices when deemed necessary.”. 19
C.F.R. § 191.61(a)(2). Clearly, the closure of a port’s drawback
office would qualify as such a necessary situation.
Court No. 07-00178 Page 10
29, 2005. Pl.’s Mem. Opp. Def.’s Mot. Summ. J. 2. The legal
authority to process the claims, however, lay with the Los
Angeles Drawback Center. In addition, the initial denial of
Plaintiff’s drawback claim, which came from the Los Angeles
office, and the June 8, 2005 Customs letter related thereto both
clearly indicate that the Los Angeles office had taken over
processing Plaintiff’s claim.13 See Resolution Request at 11;
Drawback Denial Letter at 2. As noted earlier, the Miami Office
closed in July, 2003 and transferred all remaining claims to the
Los Angeles office by July, 2004. Plaintiff has no basis for
claiming that the Miami Office should have made the drawback
determination, especially when that office had been closed for
two years.
Therefore, there is no genuine issue of material fact in
dispute, and the court will consider Defendant’s motion for
summary judgment. USCIT R. 56(c).
Defendant’s motion for summary judgment
Customs properly asserts that this court may not hear
Plaintiff’s claim because it is untimely filed. 28 U.S.C.
13
The record reflects this change of authority. While
Isaac’s counsel avers that he faxed the protests to the Port of
Miami on April 29, 2005, Defendant’s copies of the same forms
suggest that they were first received by the Los Angeles office.
See First Protest at 16 (highlighting the fact that Customs has
submitted copies of Plaintiff’s protests marked as “RECEIVED” by
the Los Angeles office).
Court No. 07-00178 Page 11
§ 2636(a) requires that an action contesting the denial of a
protest must be filed within one hundred and eighty days after
the date of denial. 28 U.S.C. § 2636(a). Customs argues that
because Isaac filed its summons on May 24, 2007, long after
Customs’s November 9, 2005 denial of its April 29, 2005 protests,
the court cannot consider Plaintiff’s complaint.14 Def.’s Mot.
Summ. J. 11. Plaintiff correctly responds that the protests
themselves were timely, having been filed fewer than 180 days
after Customs’s liquidation. 19 U.S.C. § 1514(c)(3)(A); Pl.’s
Mot. Opp. Def.’s Mot. Summ. J. 7-8. However, the timely filing
of a protest does not change the fact that Isaac filed its
complaint more than a year and a half after Customs’s protest
denial and well past the 180 day statutory time limit for such a
filing. See 28 U.S.C. § 2636(a).
Thus, because Isaac filed this action outside of the
statutory time limits, the court may not hear this case. See
Computime, Inc. v. United States, 8 CIT 259, 261, 601 F. Supp.
1029, 1030 (1984) (“[P]laintiff’s remedy was to file an action in
this court within 180 days of notice of the denials . . . not
file another set of protests”).
14
Customs further argues that Isaac’s second set of
protests were invalid and that this court has no jurisdiction
over the rejection of Isaac’s § 1520(c) claim. Because Isaac has
not addressed these issues, the court need not consider them.
Court No. 07-00178 Page 12
CONCLUSION
For the foregoing reasons, Defendant’s motion for summary
judgment is granted, and Plaintiff’s cross-motion for a stay of
the proceedings is denied.
/s/ Donald C. Pogue
Donald C. Pogue, Chief Judge
Dated: August 2, 2011
New York, N.Y.