Alden Leeds, Inc. v. United States

Slip Op. 10–102

UNITED STATES COURT OF INTERNATIONAL TRADE

______________________________
:
ALDEN LEEDS INC., :
:
:
Plaintiff, :
: Before: Richard K. Eaton, Judge
v. :
:
UNITED STATES, : Court No. 09-00476
:
Defendant. :
: Public Version
______________________________:

OPINION AND ORDER

[Defendant’s motion to dismiss denied.]

Dated: September 7, 2010

Sokol, Behot & Fiorenzo (Joseph B. Fiorenzo), for plaintiff.

Tony West, Assistant Attorney General; Jeanne E. Davidson,
Director, Patricia M. McCarthy, Assistant Director, Barbara S.
Williams, Attorney in Charge, International Trade Field Office,
Commercial Litigation Branch, Civil Division, United States
Department of Justice (Alexander Vanderweide and Arlene Pianko
Groner); Office of Chief Counsel, International Trade Litigation,
United States Customs and Border Protection (Edward N. Maurer),
of counsel, for defendant.

Eaton, Judge: This matter is before the court on the motion

of defendant the United States, on behalf of United States

Customs and Border Protection (“CBP” or “Customs”), to dismiss

the complaint of plaintiff Alden Leeds Inc. (“Alden Leeds”) for

(1) lack of subject-matter jurisdiction or (2) failure to state a

claim for which relief can be granted. The question presented is
Court No. 09-00476 Page 2

whether the court may hear plaintiff’s claim even though Alden

Leeds failed to protest timely the unlawful publication of a

notice of deemed liquidation. Defendant makes no serious

argument that it has any rightful claim to plaintiff’s money;

rather, it insists that the court has no power to order its

return.

By its complaint, plaintiff asks the court to use its

equitable powers to “instruct CBP to refund Alden Leeds the

difference between the estimated deposits of 24.83[ percent] and

the final assessment duties [of 4.07 percent] calculated for

Alden Leeds [following an administrative review] along with

interest.” Am. Compl. ¶ 21(b).1 For the reasons set forth

below, defendant’s motion to dismiss is denied.

BACKGROUND

On June 24, 2005, the United States Department of Commerce

(“Commerce”) published an antidumping duty order for chlorinated

isocyanurates (“isos”) from Spain (the “subject merchandise”).

Chlorinated Isocyanurates from Spain, 70 Fed. Reg. 36,562 (Dep’t

of Commerce June 24, 2005) (notice of antidumping duty order)

(the “Order”). The Order provided that the isos exported by

Aragonesas Delsa S.A. would receive an antidumping duty margin of

1
Plaintiff’s amended complaint mislabels ¶ 21 as (a
second) ¶ 12.
Court No. 09-00476 Page 3

24.83 percent. Id. at 36,563. On July 2, 2007, Aragonesas

Industrias y Energia S.A., the successor-in-interest of

Aragonesas Delsa S.A. (collectively, with Aragonesas Industrias y

Energia S.A., “Aragonesas”),2 filed a request for an

administrative review of the isos it produced and exported to the

United States. See 19 C.F.R. § 351.213(b) (2009). Commerce

subsequently published a notice of initiation of an

administrative review of the Order for the period June 1, 2006

through May 31, 2007 (the “POR”). Initiation of Antidumping and

Countervailing Duty Administrative Reviews and Request for

Revocation in Part, 72 Fed. Reg. 41,057, 41,057 (Dep’t. of

Commerce July 26, 2007). Commerce issued the final results of

the review on December 30, 2008, setting the final assessment

rate for the subject merchandise at 4.07 percent. See

Chlorinated Isocyanurates from Spain, 73 Fed. Reg. 79,789, 79,789

(Dep’t. of Commerce Dec. 30, 2008) (final results of antidumping

duty administrative review) (the “Final Results”).

When its entries are subject to an antidumping duty order,

an importer, such as Alden Leeds, generally makes a cash deposit

of the estimated antidumping duties contained in Commerce’s

2
Aragonesas is a Spanish producer of isos, which can be
used as a swimming pool chemical. Alden Leeds, located in South
Kearny, New Jersey, is an American importer of swimming pool
chemicals. During the period of June 1, 2006 through May 31,
2007, Alden Leeds imported isos produced by Aragonesas. Am.
Compl. ¶ 1.
Court No. 09-00476 Page 4

order. See 19 U.S.C. § 1673e(a)(3) (2006). Here, in accordance

with the Order, Alden Leeds made a deposit with Customs covering

the estimated duty of 24.83 percent (approximately $400,000) for

its entries. Pl.’s Resp. to Def.’s Mot. to Dismiss for Lack of

Jur. or, in the Alt., for Fail. to St. a Cl. (“Pl.’s Resp.”) 1—2.

The amount of duty owed by an importer, however, is not final

until the importer’s entries are liquidated.3 The final amount

on liquidation may vary from the deposit amount after Commerce

completes an administrative review. See generally 19 U.S.C.

§ 1675; see also Consol. Bearings Co. v. United States, 348 F.3d

997, 1000 (Fed. Cir. 2003).

As a result of Aragonesas’s request for an administrative

review, the liquidation of plaintiff’s merchandise was suspended.

In order to prevent the liquidation of merchandise subject to a

review prior to the final determination, the law provides for a

suspension of liquidation while the review is proceeding.

Canadian Wheat Bd. v. United States, 33 CIT __, __, 637 F. Supp.

2d 1329, 1334 n.6 (2009) (“Canadian Wheat Bd.”).

On February 7, 2008, Commerce sent Message No. 8038217 to

Customs, which stated that Aragonesas’s isos were subject to a

suspension of liquidation. Admin. R. (“AR”) 13. Despite

Commerce’s suspension of liquidation and despite having received

3
See 19 C.F.R. § 159.1 (“Liquidation means the final
computation or ascertainment of the duties . . . .”).
Court No. 09-00476 Page 5

clear instructions from Commerce that plaintiff’s entries were

not to be liquidated during the pendency of the review, Customs

posted a bulletin notice of liquidation on April 25, 2008 (the

“Bulletin Notice”). This posting indicated that the twelve

entries for which Aragonesas was the exporter and Alden Leeds was

the importer4 had been liquidated by operation of law (the

4
Counsel for defendant, at oral argument, appeared to
attempt to convert what was obviously a mistake into a volitional
act by suggesting that Customs might have intended to give notice
that these entries were liquidated by operation of law. Tr. of
Or. Arg. on Def.’s Mot. to Dismiss at 11—12. Apparently, the
idea behind this argument is that, even though Customs had
received notice that Aragonesas’s entries were to remain
unliquidated, the notice did not necessarily apply to Alden
Leeds. Counsel appeared to suggest, without saying so directly,
that Customs may have concluded that the suspension did not apply
to Alden Leeds and that this conclusion could be contested only
by way of a protest. Id. at 18—19. It is worth noting that this
argument cannot be found in the briefs and papers that defendant
submitted to the court.

To the extent that defendant actually is advancing this
argument, it is obviously a litigation position. The only way
that Customs was aware that Alden Leeds had entries to liquidate
was that plaintiff’s customs broker had filed certain papers when
the entries were made. These papers, which Customs had before it
when it issued the Bulletin Notice, were supplied to the court by
defendant as part of the administrative record of this case. The
court, therefore, has before it twelve separate sets of documents
each representing an individual entry. AR 1—12. Each set
contains: 1) an Environmental Protection Agency Notice of Arrival
of Pesticides and Devices; 2) a Department of the
Treasury/Customs Service Entry Summary; 3) an Importer’s Blanket
Statement of Non-Reimbursement of Antidumping Duties; and 4) a
Department of the Treasury/Customs Service Entry/Immediate
Delivery Form.

An examination of these forms demonstrates that 1)
Aragonesas is clearly named as the “Shipper” and Alden Leeds is
clearly named as the “Importer”; 2) the antidumping duty order to
which the merchandise was subject was identified; 3) the
Court No. 09-00476 Page 6

“purported deemed liquidation”) on January 26, 2008 under the

provisions of 19 U.S.C. § 1504(d). Def.’s Reply to Pl.’s Resp.

to Mot. to Dismiss for Lack of Jur. or, in the Alt., for Fail. to

St. a Cl. 6 (citing AR 14).

On December 30, 2008, Commerce published the final results

of its review and found that the subject merchandise entered

during the POR should be subject to an antidumping duty rate of

4.07 percent,5 a substantially lower rate than the estimated

antidumping duty rate for plaintiff’s entries was set forth; and
4) the entry numbers, which correspond to the entry numbers
listed on the Bulletin Notice, are set out clearly.

Additionally, as requested at oral argument, defendant,
on June 14, 2010, filed Message No. [[

]].
Message No. [[ ]] renders defendant’s position, advanced at
oral argument, implausible.

Customs employees are, of course, familiar with the
agency’s own forms and their contents. Customs has produced no
evidence to refute the clear conclusion that the Bulletin Notice
was a simple mistake. Thus, any suggestion that Customs intended
to post the Bulletin Notice of a deemed liquidation because
Customs was unaware that the entries in contention were the same
entries whose suspension was reaffirmed by Message No. 8038217 of
February 7, 2008 is so unreasonable as to be beyond the realm of
serious consideration.
5
“[T]he United States uses a retrospective assessment
system under which final liability for antidumping and
countervailing duties is determined after merchandise is
imported.” 19 C.F.R. § 351.212(a). While an importer deposits
estimated duties on entry of merchandise, the actual duties are
Court No. 09-00476 Page 7

deposit rate of 24.83 percent collected from Alden Leeds. Final

Results, 73 Fed. Reg. at 79,789. Alden Leeds immediately sought

a refund of the difference between the estimated deposit rate and

the final rate determined in the review. Rather than receiving

its refund, Alden Leeds was informed that the subject merchandise

had been deemed liquidated at the deposit rate on January 26,

2008. Pl.’s Resp. 3—4.

Plaintiff then brought this suit to recover the difference

between the deposit rate and the rate found in the Final Results.

Am. Compl. ¶ 21(b). Defendant has moved to dismiss the case

pursuant to USCIT Rule 12(b)(1) by insisting that because

plaintiff failed to protest the purported deemed liquidation

found in the Bulletin Notice, this Court does not have subject-

matter jurisdiction to grant relief to plaintiff. Mem. in Supp.

of Def.’s Mot. to Dismiss for Lack of Jur. or, in the Alt., for

determined later in the assessment process, at the time when the
entries are liquidated. See 19 C.F.R. § 141.103. Thus, when an
administrative review is requested by an interested party, an
importer’s payment of the actual duties is not due until the
entries are liquidated at the rate determined by Commerce’s
review. Parkdale Int’l v. United States, 475 F.3d 1375, 1376—77
(Fed. Cir. 2007) (citing 19 C.F.R. § 141.1(a)); see also 19
C.F.R. § 351.212(a) (stating that “[g]enerally, the amount of
duties to be assessed is determined in a review of the order
covering a discrete period of time.”). Additionally, “[b]ecause
19 U.S.C. § 1675(a)(2) expressly calls for the retrospective
application of antidumping review determinations . . .,
suspension of liquidation during the pendency of periodic
antidumping review is unquestionably ‘required by statute.’”
Am. Permac, Inc. v. United States, 10 CIT 535, 539, 642 F. Supp.
1187, 1191 (1986).
Court No. 09-00476 Page 8

Fail. to St. a Cl. (“Def.’s Mem.”) 5. In the alternative,

defendant argues that plaintiff’s complaint should be dismissed

for failure to state a claim upon which relief can be granted

because of the failure to protest timely the Bulletin Notice.

Def.’s Mem. 11; see USCIT R. 12(b)(5). For the following

reasons, defendant’s motion is denied.

STANDARD OF REVIEW

As the party seeking to invoke this Court’s authority, Alden

Leeds bears the burden of establishing subject-matter

jurisdiction. AutoAlliance Int’l, Inc. v. United States, 29 CIT

1082, 1088, 398 F. Supp. 2d 1326, 1332 (2005) (citations

omitted). “[I]t is of utmost importance that mere recitation of

a basis for jurisdiction not be controlling.” Hartford Fire Ins.

Co. v. United States, 544 F.3d 1289, 1293 (Fed. Cir. 2008)

(citation omitted). Alden Leeds must then plead facts from which

this Court may conclude that it has subject-matter jurisdiction

with respect to each of its claims. Schick v. United States, 31

CIT 2017, 2020, 533 F. Supp. 2d 1276, 1281 (2007) (citing McNutt

v. Gen. Motors Acceptance Corp., 298 U.S. 178, 189 (1936)

(explaining that a plaintiff “must allege in his pleading the

facts essential to show jurisdiction”)).
Court No. 09-00476 Page 9

In evaluating defendant's motion to dismiss for failure to

state a claim upon which relief can be granted, this Court “must

accept all well-pleaded facts as true and view them in the light

most favorable to the non-moving party.” United States v. Ford

Motor Co., 497 F.3d 1331, 1336 (Fed. Cir. 2007) (citation

omitted).

DISCUSSION

I. Jurisdiction Under 28 U.S.C. § 1581(i)

Defendant asserts that because 28 U.S.C. § 1581(a)

jurisdiction was available to plaintiff as an avenue for relief,

it cannot now bring a case under 28 U.S.C. § 1581(i). In other

words, defendant insists that had Alden Leeds wished to dispute

the purported deemed liquidation, it first was required to file a

protest. See 19 U.S.C. § 1514(a). According to defendant, if

plaintiff failed to gain relief by way of protest, it could then

have petitioned this Court for relief pursuant to 28 U.S.C.

§ 1581(a).6 Def.’s Mem. 7—8.

By its complaint, plaintiff asks the court to find

jurisdiction under § 1581(i). Am. Compl. ¶¶ 2—3. As this

6
Section 1581(a) provides that “[t]he Court of
International Trade shall have exclusive jurisdiction of any
civil action commenced to contest the denial of a protest, in
whole or in part, under section 515 of the Tariff Act of 1930.”
Court No. 09-00476 Page 10

Court’s residual jurisdiction provision, § 1581(i) provides for

the exercise of jurisdiction when relief is not available under

another subsection of § 1581.7 Norcal/Crosetti Foods, Inc. v.

United States, 963 F.2d 356, 359 (Fed. Cir. 1992). According to

plaintiff, in this case, jurisdiction under § 1581(i) is

triggered because other possible remedies were “manifestly

inadequate.” Miller & Co. v. United States, 824 F.2d 961, 963

(Fed. Cir. 1987) (“Miller”).

In making this argument, plaintiff asserts that, because the

Bulletin Notice was posted at the customshouse while Commerce’s

7
As noted by the United States Court of Appeals for the
Federal Circuit, § 1581(i) “was intended to give the Court of
International Trade broad residual authority” over cases
involving trade transactions. Conoco, Inc. v. United States
Foreign Trade Zones Bd., 18 F.3d 1581, 1588 (Fed. Cir. 1994).
Defendant cites Norcal/Crosetti Foods, Inc. v. United States for
the proposition that “[t]his limitation ‘preserves the
congressionally mandated procedures and safeguards . . . provided
in the other subsections [of 28 U.S.C. § 1581] . . ., absent
which litigants could ignore the precepts of subsections (a)-(h)
and immediately file suit in the Court of International Trade
under subsection (i).’” 963 F.2d 356, 359 (Fed. Cir. 1992)
(citation omitted). Indeed, the Federal Circuit has indicated
that “[s]ection 1581(i) jurisdiction may not be invoked when
jurisdiction under another subsection of § 1581 is or could have
been available, unless the remedy provided under that other
subsection would be manifestly inadequate.” Miller & Co. v.
United States, 824 F.2d 961, 963 (Fed. Cir. 1987) (citation
omitted); see, e.g., Trs. in Bankr. of N. Am. Rubber Thread Co.,
Inc. v. United States, 593 F.3d 1346, 1353 (Fed. Cir. 2010)
(affirming § 1581(i) jurisdiction for party that “ha[d] no
current or future opportunities to get judicial review”); Pac
Fung Feather Co., Ltd. v. United States, 111 F.3d 114, 116 (Fed.
Cir. 1997) (sustaining jurisdiction when “[s]ection 1581(i) was
the importers' only available and potentially adequate option”).
Court No. 09-00476 Page 11

suspension was in effect, plaintiff’s entries were not, in fact,

liquidated. Consequently, plaintiff maintains that there was no

event for it to have protested under 19 U.S.C. § 1514(a). Pl.’s

Resp. 5. As a result, plaintiff concludes that, as it could not

lodge a protest, which if denied would have provided jurisdiction

for a lawsuit in this Court under 28 U.S.C. § 1581(a), relief

under that section was necessarily “manifestly inadequate.”

Pl.’s Resp. 5. Therefore, Alden Leeds urges the court to

exercise its jurisdiction under § 1581(i) in order to provide the

appropriate relief, i.e., the return of its money. Am. Compl.

¶¶ 2—3, 21.

II. Deemed Liquidation Under 19 U.S.C. § 1504(d) and the
Suspension of Liquidation

Congress enacted the deemed liquidation statute, 19 U.S.C.

§ 1504(d), to protect importers from the uncertainties in the

United States’ duty assessment process. See United States v.

Cherry Hill Textiles, Inc., 112 F.3d 1550, 1559 (Fed. Cir. 1997).

Pursuant to this provision, entries that remain unliquidated for

six months are liquidated by operation of law at their entered

rate. See 19 U.S.C. § 1504(d).

Before the law operates to bring about a deemed liquidation,

however, three preconditions must be met: “(1) the suspension of

liquidation that was in place must have been removed; (2) Customs
Court No. 09-00476 Page 12

must have received notice of the removal of the suspension; and

(3) Customs must not liquidate the entry at issue within six

months of receiving such notice.” Fujitsu Gen. Am., Inc. v.

United States, 283 F.3d 1364, 1376 (Fed. Cir. 2002). Once these

three preconditions have been satisfied, deemed liquidation under

19 U.S.C. § 1504(d) occurs by operation of law. Deemed

liquidation under § 1504(d), however, does not result from any

affirmative action on the part of Customs. Accordingly,

when a suspension required by statute or court
order is removed, the Customs Service shall
liquidate the entry . . . within 6 months
after receiving notice of the removal from the
Department of Commerce . . . . Any entry . .
. not liquidated by the Customs Service within
6 months after receiving such notice shall be
treated as having been liquidated at the rate
of duty, value, quantity, and amount of duty
asserted by the importer of record . . . .

19 U.S.C. § 1504(d). As this subsubsection makes clear, deemed

liquidation results from operation of law, and Customs makes no

decision and performs no act in order to bring about a deemed

liquidation.8

A suspension of liquidation acts to stop liquidation,

including a deemed liquidation, from occurring. Indeed, a

8
When a deemed liquidation has taken place by operation
of law, it may be the subject of a protest. Koyo Corp. v. United
States, 497 F.3d 1231, 1243 (Fed. Cir. 2007). Judicial review is
then available if that protest is denied. See 28 U.S.C.
§ 1581(a). Where, as here, no deemed liquidation has taken
place, relief by way of protest is not available.
Court No. 09-00476 Page 13

suspension of liquidation serves an important purpose in ensuring

the application of proper unfair trade duties. Thus, liquidation

is suspended during an administrative review so that the entries

may be liquidated at the rate determined by the review. See,

e.g., Canadian Wheat Bd., 33 CIT at __, 637 F. Supp. 2d at 1334

n.6 (“A request for an administrative review results in the

continuation of the suspension of liquidation.”). In order to

assure that the entries will be liquidated at the finally

determined rate, the suspension of liquidation is not terminated

until the final results of an administrative review are published

in the Federal Register. See, e.g., Int’l Trading Co. v. United

States, 281 F.3d 1268, 1272 (2002) (holding that the “suspension

of liquidation [is] removed when the final results of the

administrative review [are] published in the Federal Register”).

Defendant, however, asserts that plaintiff could not rely on

the suspension of liquidation, resulting from the administrative

review, to shield it from claims of erroneous or unlawful deemed

liquidation. While defendant concedes that the suspension, in

fact, prevented a deemed liquidation from taking place, it states

that plaintiff has no avenue to relief by this lawsuit. Rather,

defendant argues that plaintiff was required to protest the

purported deemed liquidation that was announced in the Bulletin

Notice, and only if the protest were denied could the matter be

heard in this Court. According to defendant, this is the holding
Court No. 09-00476 Page 14

in Juice Farms, Inc. v. United States, 68 F.3d 1344 (Fed. Cir.

1995) (“Juice Farms”).

In Juice Farms, the plaintiff importer’s entries were

subject to a suspension of liquidation pending an antidumping

review. 68 F.3d at 1345. Despite the suspension, Customs,

actually liquidated the entries. Id. That is, Customs took

affirmative steps to liquidate the importer’s merchandise.

Customs also posted bulletin notices of liquidation at the

customshouse. Id. at 1346. Relying on Commerce’s suspension of

liquidation, the plaintiff did not monitor the posting of

bulletin notices of liquidation for its entries at the

customshouse. Id.

In Juice Farms, as this case, it was only at the conclusion

of the administrative review that the plaintiff learned of the

liquidation of its entries, at which point it protested and

requested a refund of the excess antidumping duty deposits that

it posted for its entries. Id. at 1345—46. Customs, however,

denied the plaintiff’s protest as untimely. Id. at 1346. The

plaintiff filed suit challenging Custom’s erroneous liquidations

of its entries, petitioning this Court to find jurisdiction under

§ 1581(i). Id. at 1345. Customs sought dismissal of the suit

arguing that because Juice Farms did not protest the erroneous

liquidations within the time frame prescribed by statute, it had

forfeited its right to bring a lawsuit under § 1581(a). Id.
Court No. 09-00476 Page 15

Having forfeited that right, Customs argued, Juice Farms could

not claim that § 1581(a) jurisdiction was “manifestly inadequate”

and thus could not sue using § 1581(i) jurisdiction.

While the erroneous liquidations in Juice Farms were found

to be unlawful, this Court found, and the Court of Appeals for

the Federal Circuit affirmed, that it was unable to order the

entries to be reliquidated because a timely protest was not made

by the plaintiff importer. Id. at 1346. The Federal Circuit

held that judicial review under 28 U.S.C. § 1581(i) was

unavailable because:

Despite information from Customs and
Commerce about suspension of these
liquidations pending investigation, the
bulletin notices adequately notified Juice
Farms of the [actual] liquidation. Juice
Farms failed to file a protest within ninety
days of [the] bulletin notice posting. Juice
Farms’ protest was untimely. The Court of
International Trade properly dismissed this
case for lack of jurisdiction.

Section 1581(i) of title 28 provides
equitable relief in those cases where
jurisdiction under the other subsections of
section 1581 are “manifestly inadequate.” In
this case, however, Juice Farms did not show
that the relief in 28 U.S.C. § 1581(a), if
properly invoked, would have been inadequate,
let alone manifestly inadequate. If Juice
Farms had protested within ninety days of
bulletin notices, it would have had an
opportunity to protest the legality of
Customs’ liquidations in the Court of
International Trade. As this court has
stated, a remedy is not inadequate “simply
because appellant failed to invoke it within
Court No. 09-00476 Page 16

the time frame it prescribes.”

Id. (citations omitted).

Defendant’s argument notwithstanding, Juice Farms is

distinguishable from the instant case because that case involved

actual liquidations rather than deemed liquidations. Thus, the

important difference between this case and Juice Farms is that,

here, Customs, by posting the Bulletin Notice, claims to have

announced a deemed, and not an actual, liquidation. This

difference is critical because, here, unlike in Juice Farms, no

liquidation took place or could have taken place, and thus no

protestable event existed for plaintiff to contest. This

important distinction lies in the different authority delegated

to Customs with respect to actual and deemed liquidations.

Customs has the authority to take the steps that result in

an actual liquidation decision. See generally 19 U.S.C. § 1500.

By way of contrast, Customs has no authority to effect a deemed

liquidation, and can make no finding or determination as to

whether or not a deemed liquidation has occurred. As the plain

language of the deemed liquidation provision makes abundantly

clear, deemed liquidation occurs solely by operation of law.

Thus, since the statute provides that “liquidation[s]” are the

subject of protests, Alden Leeds had nothing to protest because

here, unlike in Juice Farms, there was no liquidation. 19 U.S.C.

§ 1514(a).
Court No. 09-00476 Page 17

This being the case, Alden Leeds is correct in arguing that

LG Electronics U.S.A., Inc. v. United States is instructive. 21

CIT 1421, 991 F. Supp. 668 (1997) (“LG Electronics”). In that

case, LG imported color television receivers from Korea that were

subject to an antidumping duty order. LG Electronics, 21 CIT at

1422, 991 F. Supp. at 670. LG deposited antidumping duties with

Customs upon entry of the subject merchandise. Id. at 1422, 991

F. Supp. at 670. Plaintiff then petitioned this Court for review

of Commerce's determinations. Id. at 1422, 991 F. Supp. at

670—71. Pending review, this Court issued preliminary

injunctions against liquidation of the disputed entries. Id. at

1422, 991 F. Supp. at 671.

Nonetheless, during the period that liquidation was

enjoined, Customs posted notices of deemed liquidation at the

entered rate. Id. at 1422, 991 F. Supp. at 671. None of the

purported liquidations were protested within the time frame

required by statute. Id. at 1423, 991 F. Supp. at 671. LG and

Commerce eventually reached a settlement that lowered the

antidumping duty rates from those imposed at entry. Id. at 1423,

991 F. Supp. at 671. As a result, the preliminary injunctions

against liquidation were lifted, permitting liquidation at the

new rates set by Commerce. Id. at 1423, 991 F. Supp. at 671—72.

Customs, however, refused to reliquidate the entries at the lower

rate and the importer filed suit in this Court, invoking 28
Court No. 09-00476 Page 18

U.S.C. § 1581(i) jurisdiction. Id. at 1423, 991 F. Supp. at 672.

Customs moved for summary judgment claiming that the Court had no

jurisdiction over LG’s claims. Id. at 1421, 991 F. Supp. at 670.

The LG Electronics Court denied Customs’ motion for summary

judgment and confirmed jurisdiction under § 1581(i). Id. at

1430, 991 F. Supp. at 677.

In doing so, the LG Electronics Court found that Customs’

erroneous notices of deemed liquidation were invalid and of no

legal consequence. Id. at 1429, 991 F. Supp. at 676.

Liquidation is deemed to have occurred by
operation of law . . . [except] in cases of
extension, suspension or court order . . . .
Here liquidation was suspended. Thus, as a
matter of law, no deemed liquidation . . .
occurred. Although LG received erroneous
notice of liquidation of these entries,
plaintiff's claim may be heard, because LG did
not have to protest within 90 days, as
specified by 19 U.S.C. § 1514, to preserve its
right to judicial review. The computer-
generated notices of deemed liquidation are
invalid and legally inconsequential, as deemed
liquidation can occur only by operation of
law.

Id. at 1429, 991 F. Supp. at 676 (citation omitted). The court

further noted:

Notwithstanding Customs' provision for
posting notice of deemed liquidation . . .
deemed liquidation itself occurs by operation
of law. Where a liquidation has occurred by
operation of law, notice starts the clock for
the protest period, . . . but the regulations
specify that the notice be “dated as of the
date of expiration of the statutory period[]”
Court No. 09-00476 Page 19

. . . . Such notice may be posted any time
“within a reasonable period after each
liquidation by operation of law[]” . . . .
Accordingly, erroneous notice cannot create a
deemed liquidation. Without the expiration of
the statutory period, there is no date to be
noticed. As the statutory period for protest
never began to run, plaintiff may bring suit
under 28 U.S.C. § 1581(i) to compel
liquidation in accordance with the prior order
of the court.

Id. at 1430, 991 F. Supp at 676—77 (citations omitted). In LG

Electronics, as here, the entries purportedly deemed liquidated

were not, because “as a matter of law, no deemed liquidation . .

. occurred.” Id. at 1429, 991 F. Supp. at 676.

III. This Court Has Jurisdiction to Hear Plaintiff’s Case

As has been seen, Customs posted the Bulletin Notice while

Commerce’s suspension of liquidation was in effect and after

having received clear notice of the suspension of liquidation for

the subject merchandise. In addition, none of the § 1504(d)

preconditions necessary for a deemed liquidation to take place

were met prior to the posting of the Bulletin Notice at the

customshouse. Further, as this Court has made clear, “Congress

intended the suspension of liquidation required during § 1675

reviews to override the ‘deemed liquidated’ provisions of

§ 1504.” Am. Permac, Inc. v. United States, 10 CIT 535, 543, 642

F. Supp. 1187, 1194—95 (1986). As a result, no argument can be
Court No. 09-00476 Page 20

advanced to support a claim that a deemed liquidation did, in

fact, occur.

As has been noted, only “liquidation[s]” may be the subject

of protests. 19 U.S.C. § 1514(a). Consequently, Customs’

posting of the Bulletin Notice was a legal nullity and did not

have the legal ramifications that defendant argues.9 As a

result, despite defendant’s argument to the contrary, Alden Leeds

was not required to protest Customs’ legally inconsequential

Bulletin Notice. See LG Electronics, 21 CIT at 1429, 991 F.

Supp. at 676.

9
Title 19 U.S.C. § 1514(a) provides, in relevant part,
that

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 . . .
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 in accordance with chapter 169 of title
28 within the time prescribed by section 2636
of that title. When a judgment or order of
the United States Court of International
Trade has become final, the papers
transmitted shall be returned, together with
a copy of the judgment or order to the
Customs Service, which shall take action
accordingly.
Court No. 09-00476 Page 21

Since no protest of the Bulletin Notice was required,

judicial review of its contents under § 1581(a) was unavailable.

As a result, plaintiff has met the “manifestly inadequate”

standard, thus triggering this Court’s § 1581(i) residual

jurisdiction. Miller, 824 F.2d at 963. Therefore, the court

finds it has jurisdiction to hear plaintiff’s claims under

§ 1581(i)(4).

IV. Plaintiff Has Stated a Claim Upon Which Relief Can Be
Granted

For the same reasons that this Court has jurisdiction,

plaintiff also has also stated a valid claim, notwithstanding

defendant’s contention that “19 U.S.C. § 1514(a) precludes any

relief.” Def.’s Mem. 11; see USCIT R. 12(b)(5). By claiming

jurisdiction under 19 U.S.C. § 1581(i), plaintiff asserts that

its cause of action arises under the Administrative Procedure Act

(“APA”). 5 U.S.C. §§ 702 et seq.; see also Royal United Corp. v.

United States, 34 CIT __, __, Slip Op. 10-71 at 13 (June 25,

2010) (“It is, of course, axiomatic that this Court exercises

jurisdiction pursuant to Subsection 1581(i) to adjudicate a cause

of action under the APA.”). Section 702 of the APA provides that

“[a] person suffering legal wrong because of agency action . . .

is entitled to judicial review thereof.” 5 U.S.C. § 702. Here,

plaintiff alleges that it suffered a legal wrong as a result of
Court No. 09-00476 Page 22

Customs’ “wrongful disregard of the suspension of liquidation

instructions” by posting the Bulletin Notice. Am. Compl. ¶ 18.

The court’s previous discussion of the lawfulness of this

Bulletin Notice indicates that has plaintiff stated a valid

claim.

Moreover, under the APA, the court has the authority to

“hold unlawful and set aside agency action . . . found to be . .

. arbitrary, capricious, an abuse of discretion, or otherwise not

in accordance with law.” 5 U.S.C. § 706(2)(A). Because it is

apparent that the court may grant relief to plaintiff by setting

the aside the Bulletin Notice, Alden Leeds has stated a claim

upon which relief can be granted, and defendant’s motion must

fail. See Totes-Isotoner Corp. v. United States, 32 CIT __, __,

569 F. Supp. 2d 1315, 1328 (2008) (holding, in light of the

Supreme Court’s pleading analysis in Bell Atlantic Corp. v.

Twombly, 550 U.S. 544 (2007), that plaintiffs must now “allege

facts that could provide a showing that [they are] entitled to

relief”).

CONCLUSION

Here, Customs seeks to impose procedural bars to judicial

review of its erroneous act. Should its efforts succeed, Customs

would retain money that otherwise would be returned to Alden
Court No. 09-00476 Page 23

Leeds. Customs does not argue, nor indeed could it argue, that

it is entitled to Alden Leeds’s money. Indeed, in order to

advance such an argument, Customs would have to contend that a

deemed liquidation that could not and did not take place actually

transpired. Nonetheless, premised on the notion that Alden Leeds

should have monitored Customs’ behavior in order to catch the

agency’s own mistakes, Customs seeks to avoid returning the

company’s funds. As has been seen, the law does not direct this

result. Therefore, for the foregoing reasons, defendant’s motion

to dismiss is denied.

/s/ Richard K. Eaton
Richard K. Eaton

Dated: September 7, 2010
New York, New York