Slip Op. 05-35
UNITED STATES COURT OF INTERNATIONAL TRADE
BEFORE: HONORABLE RICHARD W. GOLDBERG, SENIOR JUDGE
U.S. ASSOCIATION OF IMPORTERS
OF TEXTILES AND APPAREL,
Plaintiff,
Court No. 04-00598
v.
UNITED STATES, et al.,
Defendants.
[Defendant’s motion to dismiss denied in part and deferred in part.]
Date: March 18, 2005
Brenda Ann Jacobs, David J. Ludlow, and Sharon H. Yuan (Sidley,
Austin, Brown & Wood, LLP) for plaintiff U.S. Association of
Importers of Textiles and Apparel.
Stuart E. Schiffer, Deputy Assistant Attorney General, David M.
Cohen, Director, Jeanne E. Davidson, Deputy Director, and
Michael David Panzera, Attorney, Commercial Litigation Branch,
Civil Division, U.S. Department of Justice; John Veroneau and
Jason Kearns, Of Counsel, Office of the U.S. Trade
Representative; Anne Talbot, Linda Chang, and Ada Bosque, Of
Counsel, U.S. Department of Commerce; Howard M. Radzely,
Katherine E. Bissell, and Tambra A. Leonard, Of Counsel, U.S.
Department of Labor; William H. Taft, IV, Of Counsel, U.S.
Department of State; Arnold I. Havens and John G. Murphy, Jr.,
Of Counsel, U.S. Department of the Treasury, for defendant
United States.
Court No. 04-00598 Page 2
OPINION
GOLDBERG, Senior Judge: Before the Court is a Motion to Dismiss
from defendant United States, dated December 15, 2004.
Defendant requests that the Court dismiss the complaint filed by
plaintiff U.S. Association of Importers of Textiles and Apparel
seeking review of the decision by the Committee for the
Implementation of Textile Agreements (“CITA”) to accept so-
called “threat-based” requests pursuant to its rules governing
consideration of public requests for safeguards on Chinese
textile and apparel imports (the “China Textile Safeguard
Regulations”). See Procedures for Considering Requests from the
Public for Textile and Apparel Safeguard Actions on Imports from
China, 68 Fed. Reg. 27787 (May 21, 2003). In U.S. Ass’n of
Importers of Textiles & Apparel v. United States, 28 CIT ___,
Slip Op. 04-162 (Dec. 30, 2004), appeal docketed, No. 05-1209
(Fed. Cir. Feb. 2, 2005), familiarity with which is presumed,
the Court granted a preliminary injunction in this case and
reserved judgment on defendant’s Motion to Dismiss until full
briefing on the issues raised therein was completed. On January
19, 2005, plaintiff timely filed its Response to Defendant’s
Motion to Dismiss and, on February 7, 2005, defendant timely
filed its Reply to Plaintiff’s Response to Defendant’s Motion to
Dismiss. The motion is now appropriately before the Court.
For the reasons stated below, defendant’s Motion to Dismiss
is denied in part and deferred in part.
Court No. 04-00598 Page 3
Discussion
I. The Court Has Jurisdiction Over Plaintiff’s Claims.
28 U.S.C. § 1581(i)(3) provides that this Court “shall have
exclusive jurisdiction of any civil action commenced against the
United States, its agencies, or its officers, that arises out of
any law of the United States providing for -- . . . (3)
embargoes or other quantitative restrictions on the importation
of merchandise for reasons other than the protection of the
public health or safety[.]” The Court of Appeals for the
Federal Circuit and this Court have repeatedly held that
challenges to CITA’s actions may properly trigger § 1581(i)
jurisdiction in certain circumstances. See Am. Ass’n of Exps. &
Imps.-Textile & Apparel Group v. United States, 751 F.2d 1239,
1244-46 (Fed. Cir. 1985) (“AAEI-TAG II”) (holding that this
Court has jurisdiction pursuant to § 1581(i) to consider claims
involving CITA’s administration of quotas); Fieldston Clothes,
Inc. v. United States, 19 CIT 1181, 1185, 903 F. Supp. 72, 76-77
(1995) (holding that this Court has jurisdiction pursuant to §
1581(i) to consider claims involving CITA’s administration of
quotas); Mast Indus., Inc. v. Regan, 8 CIT 214, 220-21, 596 F.
Supp. 1567, 1573-74 (1984) (finding § 1581(i) jurisdiction over
a challenge to Customs regulations restricting importation of
textiles, which CITA directed be issued).
Although defendant conceded at the preliminary injunction
hearing that this Court generally has subject matter
Court No. 04-00598 Page 4
jurisdiction over challenges to CITA’s actions,1 defendant
protests the attachment of that jurisdiction to this particular
case on two grounds: (A) plaintiff’s claims are not ripe for
review; and (B) plaintiff has not exhausted its administrative
remedies.2 For the reasons discussed below, the Court finds that
these arguments are without merit.
1
Specifically, defendant stated:
THE COURT: Well, then the Government concedes that for
subject matter jurisdiction that we do have jurisdiction
under 1581(i)(3).
MR. PANZERA: I3 [sic] and Mast has held that specifically
that there is jurisdiction in such cases.
Prelim. Inj. Hr’g Tr. at 2-3.
2
In its reply brief, defendant also raised the argument that
this Court “is not an appropriate forum in which to contest
regulations adopted pursuant to [the Freedom of Information Act
(“FOIA”)] because, pursuant to § 552(a)(4)(B), only district
courts have the power to review FOIA claims.” Defendant’s Reply
to Plaintiff’s Opposition to Defendant’s Motion to Dismiss at 6.
This belated jurisdictional argument, which relates to Count III
of plaintiff’s complaint, is utterly specious. The FOIA section
cited by defendant vests jurisdiction in district courts “to
enjoin the agency from withholding agency records and to order
the production of any agency records improperly withheld from
the complainant.” 5 U.S.C. § 552(a)(4)(B). Plaintiff’s
complaint does not allege that CITA withheld agency records in
response to a public request made pursuant to FOIA § 552(a)(3);
rather, plaintiff alleges that CITA failed to publish
regulations as required by FOIA §§ 552(a)(1)-(2). This Court
has previously asserted jurisdiction under 28 U.S.C. § 1581(i)
to consider claims implicating the affirmative publication
provisions of FOIA and, consistent with that precedent, will do
so again here. See Candle Artisans, Inc. v. U.S.I.T.C., 29 CIT
___, ___, Slip Op. 05-17 at 9-14 (Feb. 7, 2005); Cathedral
Candle Co. v. U.S.I.T.C., 27 CIT ___, ___, 285 F. Supp. 2d 1371,
1378-80 (2003), aff’d, Slip Op. 04-1083, 2005 U.S. App. LEXIS
3910 (Fed. Cir. Mar. 9, 2005). The FOIA section and case law
cited by defendant are simply not applicable to this case.
Court No. 04-00598 Page 5
A. Plaintiff’s Claims Are Ripe for Review.
Defendant argues that plaintiff’s claims are not ripe for
review because CITA has “merely agreed to consider, and to
invite public comments upon, various requests for safeguard
action with respect to textile or apparel imports from China.”
Defendant’s Motion to Dismiss and Opposition to Plaintiff’s
Motion for a Preliminary Injunction (“Def.’s Motion”) at 14.
Defendant argues that plaintiff’s claims will become ripe only
if CITA decides to impose safeguard measures pursuant to threat-
based requests, at which time a final decision will issue that
may be properly protested to this Court. Id. at 15, 26.
All cases are subject to the ripeness requirement of
Article III of the U.S. Constitution, which bars judicial review
of non-final and interlocutory actions. U.S. Const. art. III, §
2, cl. 1. In determining whether a claim is ripe for judicial
review, the Supreme Court has fashioned a two-part test for U.S.
courts to apply: (1) determine whether the issues tendered are
appropriate for judicial resolution and (2) assess the hardship
to the parties if judicial relief is denied at this stage.
Toilet Goods Ass’n, Inc. v. Gardner, 387 U.S. 158, 162 (1967).
The Court finds that both prongs are satisfied in this case.
First, plaintiff’s claims concerning the jurisdictional and
procedural propriety of CITA’s acceptance of threat-based
requests are appropriate for judicial resolution at this time.
As a general proposition, it is true that a matter is not ripe
Court No. 04-00598 Page 6
for judicial review “[w]here administrative proceedings are in
process, and the agency has not adopted a final decision[.]”
Special Commodity Group on Non-Rubber Footwear from Brazil v.
United States, 6 CIT 264, 269, 575 F. Supp. 1288, 1293 (1983).
However, CITA’s final substantive decision is not, and indeed
could not be, at issue in this case. This Court has held that
CITA’s substantive decision to impose import restrictions
pursuant to an appropriate exercise of validly delegated
authority is nonjusticiable. See Am. Ass’n of Exps. & Imps.-
Textile & Apparel Group v. United States, 7 CIT 79, 87, 583 F.
Supp. 591, 599 (1984) (“AAEI-TAG I”) (holding that CITA’s
decision to impose restrictions on textile imports and request
consultations with foreign governments concerning such
restrictions was beyond judicial review), aff’d, AAEI-TAG II,
751 F.2d 1239 (Fed. Cir. 1985). Rather, the Court’s review is
limited to a consideration of whether CITA, in making a
substantive decision, has (1) exceeded its delegated authority
or (2) failed to conform to relevant procedural requirements.
Mast, 8 CIT at 224, 596 F. Supp. at 1577; see also Motion Sys.
Corp. v. Bush, 28 CIT ___, ___, 342 F. Supp. 2d 1247, 1256-57
(2004) (finding procedural predicates to final presidential
action suitable for judicial review under § 1581(i)
jurisdiction).
Applying that precedent to this case, it is clear that
Court No. 04-00598 Page 7
plaintiff’s claims, and the injury suffered in connection
therewith, are properly focused solely on questions of (1) ultra
vires agency action and (2) procedural regularity. From this
perspective, CITA has already taken final agency actions
suitable for judicial review: (1) CITA’s decision to administer
China’s accession agreement to the World Trade Organization
(“China’s Accession Agreement”) as a textile agreement within
its delegated authority and (2) CITA’s decision to accept
threat-based requests to impose safeguards pursuant to the China
Textile Safeguard Regulations. These procedural predicates to
any substantive decision by CITA to actually impose safeguards
on Chinese textile imports are independently reviewable by this
Court. Plaintiff’s claims, which challenge only CITA’s
procedural actions, are therefore appropriate for judicial
resolution at this time.
Second, plaintiff will suffer more serious hardship if
judicial relief is denied at this stage in CITA’s proceedings
than defendant will experience if judicial relief is granted.
This Court has already found that plaintiff has suffered and,
absent a preliminary injunction, would continue to suffer
irreparable harm as a result of CITA’s acceptance of threat-
based requests. U.S. Ass’n of Importers of Textiles & Apparel,
28 CIT at___, Slip Op. 04-162 at 10-14. The Court remains
unconvinced that defendant will suffer any significant
cognizable harm if judicial resolution is pursued at this stage
Court No. 04-00598 Page 8
in CITA’s proceedings. While this case is pending, defendant
still has the ability to fully administer the China Textile
Safeguard Regulations with regard to safeguard requests based on
actual market disruption.3 In addition, defendant has the
ability, through the U.S. Congress, to clarify the authority
delegated to CITA pursuant to the terms of China’s Accession
Agreement. Indeed, Congress has already chosen to expressly
delegate other aspects of China’s Accession Agreement to the
U.S. International Trade Commission. See 19 U.S.C. § 2451. In
light of these options, defendant has failed to show how it
would be adversely affected by judicial resolution at this stage
of CITA’s proceedings.
B. Plaintiff’s Claims Are Not Barred by the Exhaustion
Doctrine.
Pursuant to 28 U.S.C. § 2637(d), the Court “shall, where
appropriate, require the exhaustion of administrative remedies”
in actions brought pursuant to § 1581(i). (Emphasis added.)
Defendant argues that plaintiff has not yet exhausted its
administrative remedies because plaintiff must first fully
3
Further, defendant has the ability to publish, in the Federal
Register, a formal amendment to the China Textile Safeguard
Regulations expanding their scope to include threat-based
requests. Although the Court does not comment on the propriety
of such action in light of the scope of the instant proceedings,
the Court notes that if defendant had only chosen to formally
amend its regulations – a fully reasonable action given
defendant’s earlier publication of a formal clarification of
those same regulations – plaintiff may have been dissuaded from
initiating this case altogether.
Court No. 04-00598 Page 9
participate in the 30-day comment period for each threat-based
request accepted by CITA before plaintiff can protest CITA’s
acceptance of these requests. Def.’s Motion at 30. Defendant
claims that the exhaustion requirement would be appropriate here
“to enable CITA to consider any information or comments USA-ITA
and other interested parties might have before determining
whether to impose safeguards.” Id. at 29.
The Court finds that this argument is wholly without merit.
As discussed above, this case is simply not about CITA’s non-
reviewable substantive decisions concerning the imposition of
safeguards. Plaintiff challenges the existence of CITA’s
regulations and CITA’s actions pursuant thereto. The Federal
Circuit has held that such regulatory challenges do not require
the exhaustion of administrative remedies. See AAEI-TAG II, 751
F.2d at 1245-46 (not requiring exhaustion under protest
procedures where importers challenged existence of CITA-directed
regulations imposing import restrictions); see also Fieldston
Clothes, 19 CIT at 1185, 903 F. Supp. at 76-77 (finding question
of CITA’s ultra vires actions ripe for judicial review absent
final agency action).
Further, even if exhaustion were appropriate, the Court
routinely asserts jurisdiction prior to exhaustion where delay
would be prejudicial to the plaintiff. See Fieldston Clothes,
19 CIT at 1184-86, 903 F. Supp. at 76-77 (excusing potential
exhaustion requirement where quota category was nearly full and
Court No. 04-00598 Page 10
delay was prejudicial to plaintiff); B-West Imports, Inc. v.
United States, 19 CIT 303, 306-08, 880 F. Supp. 853, 858-59
(1995) (rejecting exhaustion requirement where time frame for
agency deliberation was uncertain and delay was prejudicial to
plaintiff), aff’d, 75 F.3d 633 (Fed. Cir. 1996); Mast, 8 CIT at
221, 596 F. Supp. at 1573-74 (rejecting exhaustion requirement
where regulations created import embargo prejudicial to
plaintiff and administrative remedy provided “manifestly
inadequate” relief). Here, the only available administrative
“remedy” – CITA’s comment period for each threat-based request –
affords illusory relief. Defendant cannot seriously argue that
requiring full participation in CITA’s administrative
proceeding, the very legitimacy of which is at issue in this
case, is an appropriate application of the exhaustion doctrine.4
Further, plaintiff has already demonstrated a threat of
irreparable harm sufficient to warrant imposition of preliminary
injunctive relief. U.S. Ass’n of Importers of Textiles and
Apparel, 28 CIT at ___, Slip Op. 04-162 at 10-14. Because the
available administrative remedy provides manifestly inadequate
relief and plaintiff would be prejudiced by delayed judicial
review, waiver of the exhaustion requirement is appropriate in
this case.
4
Nevertheless, the Court notes that plaintiff represents that it
has participated in each of the relevant comment periods made
available to it prior to the issuance of the Court’s preliminary
injunction order. Plaintiff’s Opposition to Defendant’s Motion
to Dismiss at 10.
Court No. 04-00598 Page 11
II. The Court Defers Judgment of Whether Plaintiff’s Complaint
States Claims for Which Relief May Be Granted.
The Court, in its sound discretion pursuant to USCIT Rule
12(d), deems it proper and in the interest of justice to defer
its determination of the portion of defendant’s Motion to
Dismiss pertaining to plaintiff’s alleged failure to state
claims for which relief may be granted. The Court has
determined that it would benefit from more fulsome development,
by both parties, of the evidence and legal arguments squarely
concerning the issues presented in this case either at a trial
on the merits or, if more appropriate, in the parties’ motions
for summary judgment.
Conclusion
For the foregoing reasons, the Court denies defendant’s
Motion to Dismiss with respect to the jurisdictional issues and
defers ruling on the Motion with respect to the substantive
claims. A separate order will be issued accordingly.
/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge
Date: March 18, 2005
New York, New York
ERRATUM
U.S. Association of Importers of Textiles and Apparel v. United
States, et al., Court No. 04-598, Slip Op. 05-35, dated March 18,
2005.
On page 11, replace “The Court has determined that it would
benefit from more fulsome development, by both parties, of the
evidence and legal arguments squarely concerning the issues
presented in this case either at a trial on the merits or, if
more appropriate, in the parties' motions for summary judgment.”
with “The Court has determined that it would benefit from fuller
development, by both parties, of the evidence and legal arguments
squarely concerning the issues presented in this case either at a
trial on the merits or, if more appropriate, in the parties'
motions for summary judgment.”
March 22, 2005.