Atteberry v. United States , 2007 CIT 13 ( 2007 )

slip op. @'/-13
UNI'I``ED STA'I``ES CC.)UR'I`` OF H*ITERNATIONAL TRADE
DAN:EL ATTEBERRY,
Fz.'czz``z'.'.)f)yf)",
v. ~ h o hCourt No. 02~0064'7
Ur§l'rzz:o STA"FES,
' Defencfarzt.
[Defendant’s Motion to Withdraw Its Motion to Dismiss, To Amend its Answez', and For Iudgmeni
ora the Pleadjngs in favor of Plaintiffgrazztod.] .
Docided: january 25, 2007
Dam'oi Attobe;_rj~g, P§aintz``§ff)ro Se.
Petez D. Kois}oz; Assistant At€omey _Genora!; Barbara S. Williams, At*comey in Charge,
]ntenxational Trade Fiold`` Oi``£ice, Commercial Litigat§ola Branoh, Civ_i§ Division, U.S. Departm_ent
of justice flack S. Rockafeflou'); Yelexza Slejoak, Offioe ofAssistant Chief`` Counsel, Inter)::_ationaf
Trade Litigation, Bur@zuz of``Custolns and Border Protc_ciioll, U.S. D_epa.rtmolz``t ofHomoland Seourity,
Gf Couhsol; for Defendoa.lzt, `` '
OPINION
RID GWAY, Jucigo:
ha this action, pro se plaintiff Darziel Attoberry contests the dooisiozz of the U.S. Custozns
Serv§co ("Custoros")‘ ro~classz``fying for tariff purposes certain merchandise which he describes as
"hike[s]/ka:'t[s]/soooter[s]," imported froxn the Nethoz“lands dzrough the Port of$ea§tlo in May 2001.
'Tho Customs Servic,e xvas reorganized i'n'~-ZOOS, and is llow the Bureau of Custoxns and
Border Pl_'oteotion of the U.S. Depzu'€ment of Honze§anc``i Socra.riiy.
Court No. 02~00647 _ Page 2
Custot'ns iiqtiid.ated roost of die merchandise under various snbheadizigs of Chapter 82 ot`` the
Hannonized 'l``arit``t``$chedule ofthe United States (2001) ("I~ITSUS"} (which covers "Vehicies Other
'l``itata Railway or Trarnway Roiiiiig~$tock, and Parts and Acces series 'I``hereoi"), and assessed duties
(depend.ing on the itern) at rates of up to 10% ed vaforern.i See Custozns Sunnnons and Protest
hifornaatioit Report (a.ttached to Def. ’S letter Meino_r``anduiiz (Jan. 9, 2004)). Plaintift`` contends that
the merchandise instead is properly ciassitiable`` as entered, onrder HTSUS subheadiiig E?dt)l
("Wheeied toys designed to be ridden by children . "), duty-fi‘ee. See z``d.; Coinpiaint {tvith
attachments).
The history o_fthis Iiti_gatio:i can be traced througli the three opinions it has spawned to date
- it‘-.tteherr‘y~' Un_ited States. 2? CIT '?51, 262 F. S'==on. 13d-t {2003) idea
pursuant to 28 U.S.C-. § 2636(21)(1_), which arg_tzed that action was not ti.ied within 130 days of"date
ot``mailitng" of notice of denial of protest) (“" ”); 27 CIT 1051 (2003) (denying inotiott for
reconsideration ofAtteheiIy I) {" "); and 27 CIT 1070 (2003) (deztying motion to dismiss
pursuant to 28 U.S.C. § 2637(21) (2000),2 which was based on Plaintit``t"s t``aiiure to pay ali duties
before coinmencing' action) {"``Atteherrv Iii").
Now pendirig before the Court is Defeltdant’s Motion to Withdraw its Motion to D_iislniss,
To A_rn.end Its Answer, and For Judgment on the Pieadings, and its brief in support thereof See
generally Defendazit’s Meinorandutn in Snpport otlts Motion to Witiidraw its Motion to l)isrniss, t
EAI§ statutory references herein are to the 2000 edition of the United States Code.
Siiniiarly, all references to reguiatioiis are to the 2001 edition ot`` the Code of Fe'deral
Regniations. 't``h_e peiti_nent text of the provisions cited remained the same at ali times relevant here
Cotzrt No. 02-00647 Page 3
To Arnend its Answer, and For judgment on the Pleadings f"Dei``.’s Briei"); see also Letter to Conrt
front Coonsei for Defendaiit (March'¢t, 2005) {Def.’s Supp.. Biiet").
fn sum and substance the Goverrrtn_ent’s motion seeks to bring this litigations to a pragmatic
ioiosc. ’l``he Goveriiment emphasizes that the duties at stake total less than ‘3600 »- a figure that will
quicl~;iy be dwarfed by the “snbstantial econoinic iinpact" that "the parties and tire judicial system
as a whole" witt face as a result of "discovery, inotions, trial, andrtize very real risk ofoppeal and
i~e-tr~z‘a!" if the action proceeds See Det``. ’s Brief at 2 (emphas_is addedi).' Thc Governinent therefore
seeks to withdraw its ivlotion to Disrniss,i’ to amend Defendant’s Answer to "adniit{] that the
imported tiierchaxidise is classifiable as entered by piainti:t`` ," and to liave judgment o_n the ;Jieadings
|.\>
,.....t
2_
¢-...a
'..»»)
entered Piaiintift’ s t``a‘».toi'. See at
For reasons that are somewhat difficult to understand (and personal to hirnseit), Piaintit``i°
opposes the niotioni See gcneraih) Plaiiitifi" s Response to Ali the Defendant’s Memoraiidutn . '. .
Motions (pu'iicttiation in the original) ("Pi_.’s Brief"); Plain_tift” s Response to Amended Answer;
Piaintit``f s Response to judge Deiissa A. Ridgway, and Resnbtiiissioii ot`` Evidence Appearitig to
Show the Govern_rnent Has Been Lying to Me and the Court Atl Throughout 'l``his Case ("Pi. t’s Snpp.
Briei'”’). l
Becatise it will confer on Piaintii"t`` all the reliefprayed for in his Coin;i)laint, and because »»-
as detailed below ~ it is otherwise ii_"ianifestly "in the interests oi"justice,” Dei``endant’s Motion is
granted
zCoiicurrerit with its proposed withdrawa.``t of its Motion to Disi.niss, the Governrrient requests
vacatur of Attehe@ tll, which was addressed to that rnotion. See Def.’s Motioii at l_~3, 6, 9;
Atteberry I]i, 27 CIT 1070.
Cozzrt No. 02-00647 `` Page 4
I``. Bacl;groun_d
The materiai facts of this case are relatiuely straightforward, and not in dispute_." in late May
2001 , a shipment of““hil<;e{sl/lcazt[s}/scooter§s]" from the Netherlands was entered dirty-free through
the port of Seattle by plaintiff irnporter, Daniel Atteben'y. Mr. Atteberry is a relative novice at
importing, with only one prior experience, in October 1999 ~ wl':en, importing apparently the sarno
type ofnierchaiidise (albeit through a different poit), the goods were liquidated as entered, duty-free
Thus, before the events that gave rise to this ease, Plaintit``f had no prior experience with Custom.s’
protest process, no experience with tiling an action in this Cou.rt to challenge Cttstolns’ denial
of a protest.
Based on his experierce his first t"oray into '~a~'orid of texas eppa;reritlj,f
surprised when Custoins begani inquiring into his second entry of the sarno type of``mereh_andise. He
nevertheless respond ed promptly to Customs’ two Requests for I:nt``orrnation, which were conveyed
to him through his hroleriy lll] concerning a
novel area of jurisdictional j uiispiiidence without the Goveinmerit’s even having the opportunity to
submit any brief on the issue," and asserting that "[Plointifi``} did riot raise the jurisdictional grounds
relied on by the .¥oclge; the Coort acted sua sponze"). ``
Court ``No. ()2-00647 l Page 13
Govennneiit on notice of the gravamen_ of Piaintift"s jurisdictional argument - i.e., that he never
received a bill for the outstanding duties.” i\/ioreover, to the extent that the Governrnent beiieves
that it would have been better to have a more complete factual record as a basis for its Motion to
Disrniss and the Couit’s decision thereon, it has oniy itself to blame The Government voluntarily
chose to tile its motion at the outset of the case, in lieu of an Ans\ver and before seeking discovery
Eveii after the Court began irsquiring into Customs’ billing practices and obligations the
Governmeiit did not seek to withdraw its Motion to Dismiss, or to defer action on the motion
pending discovery.“ Any claim of ainbush theis has a hoiiow ring.
T he Govertmieiit also suggests that Attei)egy HI absolves Plaintif§ of ali responsibility, and
sser'ts that "it is tinfai.r to Custoins ~ both to the §ie§d oitieers to tire ntanaeet's responsible i.or
§D
them - to effectively excuse Atteberry front taking care ofbusiness." See generally Def.’s Brief at
3-4. 'l"he Governrnerit einpliasizes that there was "a three or four month window between October
“In addition to Piai_iiti;t``t’s snbrnissions, the Governrnent was also on the receiving end of
several letters from the Court that put the parties on notice that, inter ah``a, the Court was analyzing
Castoms’ billing practices and obiigations underits regulations vis-a-vis Plaiiitit"t" s claim that he was
iiever billed. See generally letter to Parties front the Coei't (May 23, 2003); Letter to Plaintit``i`` from
the Court (Jnne 3, 2003).. Those letters made it clear to any reader t.‘nat the Court viewed this action
as soinethirig other than a straightforward "garden variety" case of a prospective piaintift" s failure
to pre-pay outstanding duties (as the Govemrnent sought to portray it),
l"ndeed, even before Attehei;y ill issued, the Govezni'nent staked out its position, taking
exception to the Court’s inquiries into Custorns’ biliing practice and sirniiar matters See Def.’s
letter Menioraiidttni (Jun_e 12, 2003). 'i``he Governnient thus obviously appreciated {and, rnoreover,
affirmatively objected to) the fact that, in corisiden'ng the Go-vernm_ent’s then-pending Motion to
Disiiiiss, the Court was iooking beyond the conceded fact ofl?’laintit``t" s failure to pay the'outstanding
duties before tiiing this action.
”Nor did the Govennnent see§< reconsideration ol`` Attebe;ry IH after the faot.
Coutt N``o. 02~00647 _ _ Page 14
21, 2001 and early February .?.002, during whichr Custorns had virtually no iiew inailing address for
[Plaintiff] and sent out four biils to his address of record." See Def.’s Brief at 3. While those facts
are true, they are also largely irrelevant to the narrow holding in Atteheny I]I, which focused on a
different (and, for purposes of subject iuatterjurisdiction, rnucli rriore critical) timefraine m the §80-
day period after Custorns’ tnailing of the denial of the protest, during which time Pi.aintit``t`` had to act
to perfectjui'isdictioii in this Co ort, and during which tirne the agency admits that it sent no bills to
Plaintiff at a.ziy add.i‘ess. .S'ee Attebew I.ll, 27 CIT at §082, 1085 n.36, 109-4-95."‘ l
Distii_led to its esseiice, Atteher;y ill heid that ~ in the unusual circumstances of this case »»
because 28 U.S.C. § 2637(a) clea:riy conteinpiates tiiat importer vriii been notice of ainount of duties
to be paid, where Customs failed to sen_d Plainti_fii`` even a single hiil within tire 180-day period dining
which Piaintiff had to perfect jurisdiction in this cotn't, P§aintit``t`` s failure to pre-pay the duties did
"]iideed, Atteb city iii expressly disclaimed any need to reach the issue of Customs’ actions
prior to Aprii 2002, tvhen the notice of denial of Piaintiff’ s protest ives inailed to hirn. Sse Atteb~e@'
_I__§l, 27 CIT at 1085 11.36. t
The Governrnent notes that "thougii plaintiff ``was required to pay §Custorns’} bills within 30
days, he did iiot," and argues that "[i]t is unfair to hold someone in {Piairitift’s] shoes~fau.itless." See
lf)ef.’s Brief at 4.
As discussed above, the time period before the mailing of the notice of denial of Piainti_fi" s
protest is essentially iri'elevaiit for purposes of jurisdiction Bti.t that is not to say that no
coiisequeitces attached to Plaintift" s conduct As a result of his actions and omissions during that
period tend beyond) p-~ including for example his failure to file a notice of clie.nge of address with
the U,S. Postal Service, and his failure to ensure that Custorns had on tile an tip-to~date address for
him ~ Plaintii``f apparently t``aiied to receive any of the four hills that Custoins sent iiini. in effect,
Plaiiitiff’s actions and omissions operated to deprive him of the opportunity to minimize the amount
owed by paying Customs’ assessment proinptly. interest on the assessed duties therefore continued
to acciue, ensuring that the Governinent would be made whole iiotwithstandiitg Plaintiff’s delay in
payrnent. T‘.iius, nothing in Attebeny iii held Piaintiff"fauitiess," and nothing exempted hint horn
tire accrual of interest on the principa§ owed, much less the payment of the duties assessed.
Court No. 02»(30647 Pag'e 15
l riot deprive tire court of jurisdi.ction. in so holding, Attebe;l;y 111 addressed two inter-related
arguments advanced by the Goveriinient, relating to Customs’ recordkeeping billing practices..
First, the Governrnent argued that- iiotwithstandiiig 19 C.F‘.R. § ?.¢l.flafd)(l) ~» Custorns was
not requirecl to colitirn.ue sending Plainti_ffinontlily hill_s, because Plaizif;iffhad no "address ofrecor "
on tile with the agency Seconcl, according to the Goveriune:ot, Plairitit``f lied no "address of reeor "
on tile with the agency because ehangesi to an importer _s address of reeord" earl he made only by
submitting a Custolns Forrn CF 5106, "‘Notification of lm_porter’s Numher or``Application for
h_‘nporter’s Nuzn’oer, or Notiee of Cliang'e oi``Name or Address" ("CF 5106_"); th_us, the Govemment.
argued, Plaiiitifi’s e-nzaii to Custolns iii early April 2002 ~ which provided luis "current iuailiiig
address," in response "o the af'ercy’s request - could not constitute m o.i;ci..r notice of cl".ange of
his "address ot“reeord."”
111 its pending Lnotion, the Government explains that Attebeuy iii poses potential operational
problems for Custo‘ms, as to both recordkeeping and billing According to the Government, those
operational concerns ~- as well as concerns about the precedential effect of the opinion - would
Weigh_ in favor of appealing Atteben;g 111 (if possihle) at the conclusion of this case on the merits.
'$Both fine Goveinment and the Court liave ret``erredt frequently to the concept ofan importer’ s
"ai:l``clress of record'." lt is worth noting, however, that the term does not appea;rt either in Custoins’
billing regulations (for example 19 C.F.R. § 24.33(€§)(})) or in l§l C.F.R. § ZJl.S{a), the regulation
that the Goveinrnent cites as authority for the proposition that éhaeges to iniporters’ "‘add_resses of
recor " can be made only by suhinittiiig a CF 5206. Nor does it appear on Cl§`` 5106 iteelf.
Court No. ()2~0€)647 Page 16
' l.. Concerns about Irriplicatioiis for Custotns’ Recordl83 F.3d 391, 395 {Fed. Cir, 1996). f
The Government"s expansive reading ot`` l 9 § 24.5(3) is particularly dit``licult to square
t with the explicit language of 19 C.F.R. § ttl.$@, which u.nequivocally imposes on customs brokers
an obligation to "in"unecliately give written notice of [a] new address to each director cf a port that
Conrt No. 02~00647 Page 20
lt would seem to be a relatively straightforward matter for Cnstoins to arnend 19 C.F.R. §
24.5, to address the gap in the regulation highlighted by the events of this case and to ensure that the
language of the regulation itself fully reflects Custorns’ intent See, e.g., Bef.’s Supp. Brief at 3
(cz'z‘i)zg Notice of Proposed Rtileinal~:in_g for 19 C.F.R. § 24.5, and emphasizing that~ in promulgating
the regulation ~» agency intended to require importers to file CF 5106 Wliencver there was a "change
in name or the address of the party filing the forrn" .2° Any such amendment Would, of course, be
irrelevant to the case at bar.'°" And, any event, granting the Govennnent’s pending motion will
moot this issue as to Plaintifi`` and the facts of this case.
2. Conccrrrs About implications for Custoiiis’ Billing Practices
iTlie second basic operational issue raised by the Governinent concerns Custorns’ billing
practices and compliance with 19 C.F.R. § ``.ile.fla(d)(l), which - in general ~» rnandates-t:hat the
agency continue seriding monthly bills to an importer’s address of record "until the bill is paid or
is affected by the change of address.” See 19 C.P.R. § 111.3{). The existence a:nd clarity of .§ 1 1 130
' demonstrate that Custorns knows how to write a regulation that - on its face -» affirmatively and
unambiguously imposes an obligation to immediately file changes of address with the agency And
it effectively casts in sharp relief the inadequacies in the drafting of § 24,5(3).
"``°l\iote, however, that - even where a regulation expressly requires the use of a specific form
for a particuiair,purpose - iiotice given in some other fashion is not necessarily invalid. See, e.g.,
.lnte_rcaraolll.ns. Co. v. limited Statcs, 83 F.3d 39§, 395 (Fed. Cir. 1996) (cited in Atteberg IH, 2'? Ci'i``
at 1083).
”As of the date ofits Supplernentai Brief, the Govennnent advised that no relevant changes
to Custorns’ regulations were "presently under corisideiatioii." See Dei``.’s Supp. Brief at 6.
court Ne. 0_2-00647 _ regs 21
otherwise closed." lQlC.P.Il. § 24.3&(<1.)(1).'°'2 See generally Attebe@ lll, 27 CIT at 1072-74
(suinma“r'.izing Ctz.stoms’ billing 'regelatioiis). 'l``he Goveroment asserts that Attebez_i_'y fill i:nplicitly
holds that "Ctistoins has a duty under [§9 C.F.R. § 24,3@.(6)(1)] to be more pro~aetive in billing
importers using the pliooe, available e~mail addresses, and so forth - rather than assuming that
Customs ca11 ss``_tnply bill to the impoiter’s address of reoord." See generalz’y Def.’s Bz”ief at 6.
"l``l_ie Govez'_'ziment mist'eacls Atte’oerrv ill Nothing in tliet opinion should be understood to
suggest test § 24.321(€1)(1) requires Customs to do anything more titan send regular monthly bills to
an impotter’s "acléress of reoord" - al_though, to be sure, one of the central issues addressed in the
opinion is what an importer’s "adds'ess ofi'eeord" is, and how that address can be changed.
in the ease "t bag ltovv'ev"i', Custotns se'st four bills to l?‘iaintifi’s "ad: Co, v. limited States. 6 CIT 146, 573 F. Supp. 117 (1983); Meico Ciothing Co.
_ v. Uriited. States, 16 CIT 889, 804 F, Supp. 369 (1992}).
But'AttebeM iii cleariy distinguished this case from the iine of cases that the Goverrmietit
cites See Attehei;_';g HI, 2? Ci'i`` at 1081 & n.32. As Atteb.e;ry[ iii explained, unlike the case at bar,
_ootie of those cases~"iiivolved a claim that Custoriis had failed to notify the importer ot`` time duties
and iritciest owed." Id.
court Ne, 0.2_00647 l _ page 2a
Brief at l; see also De£is Brief at 6 ("At this point, this is not an appeal and we are not asking for
a reversal . . . {\V[e believe that it is less iniportant to the fair and efficient resolution of this case
that we are_riglit, than the fact that reasonable minds could differ, and that due to the far-reaching
effect of [Attebenjg ill], it is highly likely the Government would pursue an appeal."). Particularly
in light of the sui g.ezrerz's statute ot``the case and the relatively modest ainouiit in dispnte, it inalces
little sense to require the Governnient to persevere in this litigation simply to preserve its potential
ri ght to appeal Atteh erry ill at some point in the future And, i.t.`` the Governnient’s Motion to Dismiss
is withdrawn, the grounds for that opinion are obviated
Plaintiff objects to allowing tire Governrnent to withdraw its Motion to Disrniss, and to
va“*rirr»g Attehen“y' HI. Aoeordittg to i~lairitii``i``: "'t``hey [tlte Goverttrxoent] h'“'"e 'wtiiiied itzsiste'r:tly
about what a borden this ruling will have on Cnstorns and it must be changed. Changing the Ruling
would Settle pthe case in the Govermnent’s t``avor.” See Pl._’s Snpp. Brief at 2. 'i``he general tln‘ttst of
Piaintiff’ s objection thus appears to be that vacatur of Attebeny ``L``[I will somehow diminish his
victory over the Govern;tnent. See Pi.’s Briet``at. 1 ("A.ll other things my time limits and paying the t
Cost have ``t>een ruled upon. lt is now time for Summary Ju``dgrnerrt on the part of Plaintift``.").
However, as explained elsewhere herein, the result ofgra;nting the Goverznnent’s niotion is to award
Plaintii``t``the fnli measure of relief to winch he would be entitled if he tvere to prevail on every issue
at every stage of litigat``ion, and the ease went all the \vay to the U.S. Suprente Conrt.”
“in any event, as the Goverznnent points out, granting the pending inotion vvili tiotinal274 U.S. 225, 233-37 (l927). See also Averzues in heather Inc. v.
United States, 317 F.3d 1399 (Fed. Cir. 2003}; ~?)V lnc. v. Unjtecl States, 23 Cl'l`` 1047, 83 F. 'Supp.
2d l35.l (1999); cf Dai;rller Clt;ysfer Co;},)_. v. United Stetes, 442 F.Zd 1313, 1321 (Fed. Cir. 2006);
A'-Je:rr.:es in l_leether. l'oe. '~J. T lnited Ststes, 423 F.Bd l326, 133‘€)=31 (Fed. Cir. 29$5); Got§et Beoic§o. _
v. Unitted States, 14 ClT 458, 465, 743 F. Stzpp. S'Bl_, 888 (1990); Sohott Optical Glass, Irto. v. United
h, 750 F.Zd 62, 64 (Fed. Cir. 1984}. See generally l_``)ef.’s letter Mentoranduln (.lan. 2.'2, ,_2{)0-'»1)
at l»2.
The effect of the admissions in Defendant’s Aanended Answet', together with its l\/Iotion for
judgment on the Pleadi_zlgs inlfavor of Plaintiff, thus is to grant Plaintif``f all the relief to which he
could he legally entitled - classification (a.nd reliquidation) of his merchandise duty»free, as it was
entererl. Plaintiff has notltirtg more to gain (aod, irldeed, potentially much to lose) by proceeding
with litigstiorl.
Deoosit Guarantv Nstiorzs.l Bank v. Rooer, 445 U.S. 326 (1980), presented the question
whether a plaintiff who is offered all the relief he demands may refuse that offer and i_tlsist on a trial
instead. 'l"he answer is no. Accordittg to _Ro,oer, a party “Who receives all that he has sought
_ Court No. 02-0'0647 ' Pa_ge 33
generally is not aggrieved ’oy the judgment affording that relief and cannot appeal from it." Roper,
445 U.S. at 333. lndeed, the Couit suggested that the stone principie would tillaint {Plaintift``s letter to the Coort of
October 3, 2002) that the imported merchandise at issue in this action is classifiable as entered by
Plaintit``f, and to deny all other allegations in the Complaitit or to deny having knowledge or
information sufficient to form a belief as to the truth of those allegations isi.grantod; and it is t``tli'tlier
ORDERED, ADJUDGED, and DBCREED that Dei``endant"s Amended Answer is deemed
filed as of this date; and`` it is further
ORDERED, ADJUDGED, and DECREED that Defendant’s Motion for judgment on the
Pleadings against Defen.dant and in favor of Pfaiiitift`` pursuant to the admissions in the Ainended
Aiiswet is granteci; and it is timber
ORDERED, A_DILYDGED, and DECREED €;hat, in accordance with Defendant’s Amended
Answer and its Motion for judgment on the P!eadings in favor of Piainé;iff, the onported
lnerclzandise covered by Entz'y No. 603-1048306-4 made at the Port of Seat§;le, Washingtozz, on or
about May 23 or May 24, 2.()(}_1, s§zal} be classified as entered by P}einfiff; and it- is z"u;“cher
ORD.ERED, ADJU"D GED, and DECREED that file Bureau of Cus”roms and Border
Protection ofthe U.S. Deperttnent of``Homeland Securi’zy shail rel_iquidate Eni:ry No. 6{}3-1048306-4
as entered by P!aintiffl)oniei ;Xtteberry, and shall refzmd to P_Zaini:iff``ealy excess duties paid, together
with interest thereon as provided by iaw. ~
/S/ Delissa A. Ridgwey
- lodge
Da“ced: january 25, 2007
New Yorlc, New York