CIT Dismisses Challenge to Liquidation Extensions During AD/CV Evasion Investigation
The Court of International Trade dismissed a challenge to CBP’s extensions of the liquidation deadline on entries of citric acid from India and the Dominican Republic. CBP and ICE had been investigating possible transshipment of citric acid from China through India and the Dominican Republic to evade antidumping and countervailing duties. Plaintiffs Chemsol and MC International argued that the investigation was inactive because CBP and ICE had not requested new information from the companies, and so CBP was unjustified in its extensions. But the court said CBP was within its rights to extend the liquidation deadlines, because CBP isn’t restricted to seeking more information only from the investigated companies.
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During 2009 and 2010, MCI made 13 entries of citric acid from India, while Chemsol made six entries of citric acid from the Dominican Republic in 2009. At the same time, CBP and ICE began an investigation into whether Chinese citric acid was being transshipped through other countries to evade AD/CV duties. CBP and ICE requested information from plaintiffs several times on their entries, and MCI and Chemsol said they complied fully with the requests.
Citing the continuing investigation, CBP extended the liquidation deadline, in some cases more than once. CBP did not exceed the three allowable one-year extensions to the liquidation deadline. In several cases, CBP extended the liquidation deadline without having requested information from MCI or Chemsol during the previous year.
In a challenge to the status of the unliquidated entries, MCI and Chemsol filed suit under the 28 USC 1581(i) residual jurisdiction provision, arguing that CBP was unjustified in extending the liquidation deadlines because it did not use the extensions to gather more information from the plaintiffs. The companies cited Ford Motor Co. v. U.S., where the U.S. Court of Appeals found CBP should have liquidated entries because an investigation had become inactive.
But CIT said extensions to the liquidation deadline may be used to gather more information from any number of sources, not just from the investigated companies. Therefore, the court said, CBP was not unjustified in extending the deadlines. Furthermore, this case differs from Ford, because here CBP requested the extensions, and continued its investigation. In Ford¸ the investigation had been inactive for years, and CBP had exceeded the liquidation deadline.
Rather than file suit under Section 1581(i), MCI and Chemsol should wait until the entries are liquidated, protest, and file suit on Section 1581(a) grounds if the protest is denied, the court said.
(Chemsol, LLC v. United States, Slip Op. 13-35, dated 03/20/13, Judge Pogue)
(Attorneys: George Thompson for plaintiffs Chemsol, LLC and MC International, LCC; Justin Miller for defendant U.S. government)