International Custom Products, Inc. v. United States

Slip Op. 08-53

UNITED STATES COURT OF INTERNATIONAL TRADE

International Custom Products, Inc.,

Plaintiff,

v.
Before: Gregory W. Carman, Judge
United States,
Court No. 07-00318
Defendant.

[Plaintiff’s motion for a temporary restraining order and a preliminary injunction denied
because the Court lacks jurisdiction over the entries which are the subject of the request.]

Mayer Brown LLP (Andrew A. Nicely, Simeon M. Kriesberg, and Jeffrey C. Lowe) for
Plaintiff.

Gregory C. Katsas, Acting Assistant Attorney General; Jeanne E. Davidson, Director,
Commercial Litigation Branch, Civil Division, United States Department of Justice
(Edward F. Kenny), and Yelena Slepak, of counsel, Office of Assistant to Chief Counsel,
International Trade Litigation, Department of Homeland Security, U.S. Customs and
Border Protection, for Defendant.

May 20, 2008

OPINION & ORDER

Before the Court is the motion by Plaintiff, International Custom Products, Inc.

(“ICP”), for a temporary restraining order (“TRO”) and a preliminary injunction against

Defendant, United States. ICP requests that the Court order the U.S. Bureau of Customs

and Border Protection (“Customs”) to place 98 entries of a product called “white
Ct. No. 07-00318 Page 2

sauce”1 in “suspended liquidation status” during the pendency of this case.2 (Mem. of

P. & A. in Supp. of Pl.’s Application for a TRO & Mot. for a Prelim. Inj. (“Pl.’s Mem.”)

1.) The government opposes ICP’s motion, arguing that the Court cannot grant a TRO

or a preliminary injunction because, first, the Court lacks jurisdiction over the entries,

and, second, ICP has not shown that an injunction is warranted in any event. (Def.’s

Mem. in Opp’n to Pl.’s Application for TRO & Prelim. Inj. (“Def.’s Resp.”).)

The 98 entries for which ICP requests a TRO and a preliminary injunction are not

part of this case: there is only 1 entry listed on the summons, entry number

180-0590029-7, and ICP acknowledges that before filing suit, it paid the liquidated

duties for only that entry and no others.3 (See Pl.’s Mem. 1; Def.’s Resp. 13 n.7.) In fact,

1
The government refers to the product as “dairy spread.” Because several
opinions have issued from the Court of International Trade referring to the product as
white sauce, and because these semantics are not outcome-determinative, the Court will
continue to call the product white sauce.
2
The parties differ on the number of entries at issue here: ICP requests a TRO and
preliminary injunction over 98 entries, while the government in its brief refers to 99
entries. Because the party requesting an injunction controls the scope of its request, the
Court proceeds with the understanding that 98 entries are at issue.
3
Although ICP lists 100 entries in 2 attachments to the summons, one of which is
entry number 180-0590029-7, the inclusion of the entries as attachments to the summons
does not satisfy the statutory prerequisites to filing suit, namely, that Customs has
denied the protest containing the entry; that the importer paid all liquidated duties,
charges, or exactions for the entry; and, that the importer filed a summons listing either
the protest or entry number within 180 days of the denial of the protest. See 28 U.S.C.
§§ 2636(a), 2637 (2000); Daimlerchrysler Corp. v. United States, 442 F.3d 1313 (Fed. Cir.
2006).
Ct. No. 07-00318 Page 3

for 84 of the entries, Customs has yet to issue its decision regarding ICP’s protest. For

another 13 entries, Customs has denied ICP’s protest, but ICP has not paid the

liquidated duties, or filed a complaint in this Court challenging Customs’s denial of the

protest.4

Because the 98 entries are not part of this case, the Court lacks jurisdiction to

issue an injunction covering those entries. Am. Air Parcel Forwarding Co., Ltd. v.

United States, 6 CIT 147, 150, 573 F. Supp. 117, 120 (1983) (denying injunction because

“tender of additional duties determined to be due on liquidation is a condition

precedent to invoking jurisdiction of this court . . . . [Therefore], this court lacks subject

matter jurisdiction as to all entries for which the additional duties have not been paid.”);

Dexter v. United States, 424 F. Supp. 1069, 1071 (Cust. Ct. 1977) (denying injunction)

(“[T]his action in reality only covers one specific liquidated entry and has no legal

connection to the entries for which relief is sought. . . . Until the entries are liquidated

and protests denied this court has no jurisdiction over them, not even by way of its

jurisdiction over another entry of exactly the same merchandise.”); see also

4
The Court recognizes that the 84 not-yet-denied entries plus the 13 entries that
have been denied does not equal 98 entries. It equals 97 entries. In its brief, Customs
states that ICP did not properly protest 2 entries, which suggests that Customs’s
statement that there are 99 relevant entries might be accurate (84 + 13 + 2 = 99), though
ICP has requested a TRO and injunction for only 98 of them.
Ct. No. 07-00318 Page 4

Daimlerchrysler Corp. v. United States, 442 F.3d 1313 (Fed. Cir. 2006) (court lacks

jurisdiction over entries not included on summons).

ICP attempts to convince the Court that pursuant to 28 U.S.C. § 1367(a) (2000),

the Court can exercise supplemental jurisdiction over, at least, the 13 entries for which

Customs has denied ICP’s protest.5 (See Pl.’s Reply Mem. 8-12.) Section 1367(a) grants

district courts supplemental jurisdiction over all claims that are part of the same case or

controversy as a claim within the district court’s original jurisdiction. For example, this

court could exercise supplemental jurisdiction over a takings claim where an action

challenging an import embargo was properly before the court pursuant to original

jurisdiction. B-West Imps., Inc. v. United States, 19 CIT 303, 315, 880 F. Supp. 853, 864

(1995), aff’d, 75 F.3d 633 (Fed. Cir. 1996).

This case is not analogous. ICP acknowledges that this Court would

immediately have original jurisdiction over the 13 denied entries pursuant to 28 U.S.C.

§ 1581(a) (judicial review of a denied protest) if ICP could afford to pay $28 million in

liquidated duties. In fact, ICP brought this very case challenging a denied protest of one

entry under 28 U.S.C. § 1581(a). Teaching from the Court of Appeals for the Federal

5
While ICP presumes in its initial brief that the Court has jurisdiction over the 98
entries for which it seeks a TRO and a preliminary injunction, it is only in its reply brief
that ICP puts forth any argument on this point. And, while the initial brief requested
injunctive relief for all 98 entries, ICP is silent in its reply brief whether it maintains its
request to issue a TRO and preliminary injunction for the 84 entries for which Customs
has not yet issued a decision regarding ICP’s protests. (See Pl.’s Reply Mem. 15.)
Ct. No. 07-00318 Page 5

Circuit is clear that a plaintiff cannot avoid the inconvenience of paying liquidated

duties by artful pleading. See, e.g., Int’l Custom Prods., Inc. v. United States, 467 F.3d

1324, 1326-27 (Fed. Cir. 2006). Accordingly, the Court holds that supplemental

jurisdiction cannot be used as a basis to grant an injunction over these entries. Alberta

Gas Chems., Inc. v. United States, 496 F. Supp. 1332, 1335 (Cust. Ct. 1980) (court’s

“equity power can apply only to matters within a court’s jurisdiction and cannot be

exercised in disregard of the mandatory requirements of the jurisdictional statute.”)

(internal quotation marks removed).

Yet, not all is lost for ICP. Customs represented to the Court that it has “on its

own placed [84 of the] entries into a suspended liquidation status pending the

resolution of this case.”6 (Def.’s Mem. 15 n.8.) The Court expects Customs to, as it

states, “continue to handle [ICP’s] entries in the fair and appropriate manner in which it

processes all other importers’ goods,” and interprets this commitment to mean that

Customs will suspend the protest process for the 84 entries until a final decision is

reached in this case, that is, until all appeals have been exhausted.

6
ICP states that it asked Customs to place the 13 denied entries in suspended
liquidation status, but that Customs denied the request because the agency “believes it
is powerless to correct its error . . . because the liquidations purportedly have become
final . . . .” (Pl.’s Reply 7.) The Court makes no statement as to the validity of Customs’s
purported belief.
Ct. No. 07-00318 Page 6

CONCLUSION

Because the Court lacks jurisdiction over the 98 entries which are the subject of

ICP’s request, it is hereby

ORDERED that ICP’s motion for a TRO and a preliminary injunction is DENIED.

_/s/_Gregory_W._Carman____
Gregory W. Carman
Dated: May 20, 2008
New York, NY
 ERRATA

International Custom Products, Inc. v. United States, Ct. No. 07-00318
Slip Op. 08-53 (May 20, 2008)

On page 1, in the text identifying counsel for the parties, replace “Jeffrey C. Lowe” with
“Jeffery C. Lowe”.

Dated: May 27, 2008