Hitachi Supreme Court Petition Backed by Three Import Industry Groups
Three import-export industry groups support the Hitachi Home Electronics (America) petition asking the U.S. Supreme Court to step in and give force back to a 42-year-old federal statute that bars U.S. Customs and Border Protection from dragging its feet on import duty protests (CED Aug 16 p5), the groups said in separate friend-of-the-court briefs. Filing the briefs were the American Association of Exporters and Importers (AAEI), the Customs and International Trade Bar Association (CITBA) and the National Customs Brokers and Freight Forwarders Association (NCBFFA).
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In 2003, Hitachi began importing plasma TVs into the U.S. that were produced at its factories in Mexico, and paid 5 percent import duty on every set it shipped, it said in its July 30 petition. It filed 10 protests with Customs claiming it should have been allowed to ship the sets duty-free under the North American Free Trade Agreement, it said. But Customs never acted on the protests, contrary to the Customs Courts Act of 1970, which places a “two-year limitation” on granting or denying such protests, it said.
Hitachi sued to have the two-year limitation enforced, but lost in the Court of International Trade and the U.S. Court of Appeals for the Federal Circuit, and now wants the Supreme Court to hear the case. “If in fact Customs has the power to disregard a protest, or defer decision on it, the agency can act as a gatekeeper, depriving the Court of International Trade of jurisdiction over protest matters, other than in exceptional cases,” said the AAEI, in backing the Hitachi petition. “This is inconsistent with Congressional intent, and threatens the viability of the Congressional scheme for judicial review of Customs decisions in specialized courts."
The issues raised in the Hitachi petition are “of utmost importance to importers,” the AAEI said. “Since deciding a protest can only cost the government money -- if allowed -- or expose it to suit -- if denied -- Customs has every incentive to leave protests unresolved, particularly in difficult cases, or cases involving large sums of money.” The AAEI thinks it’s “evident that Congress intended Customs to be a way-station, and active participant, in the scheme of protest review, rather than an unresponsive gatekeeper,” it said.
The CITBA believes that the legislative history of the Customs Courts Act of 1970, “which is the basis for the protest statute, indicates an intent to provide a limit of two years” for Customs to approve or deny an import protest, it said in its brief. It thinks the federal appeals court “relied on inapposite Supreme Court cases in its interpretation of mandatory statutory language while ignoring the legislative history of the statute in reaching its decision,” it said. The CITBA thinks that “the proper interpretation” of the law is that protests not approved or denied by Customs “within the two-year statutory period are legally deemed approved,” it said.
The appeals court decision that went against Hitachi “creates a means for Customs to refuse to act on a protest indefinitely despite the clear statutory direction to do so within two years,” said the brief by the NCBFFA, which represents 870 companies with 100,000 employees in international trade. According to the NCBFFA, “statutes are to be interpreted according to the intention of the legislature -- the cardinal rule of statutory construction.” It therefore thinks “the plain language of the statute controls before recourse to any interpretation through case law,” it said. “The statute never contemplated that a protest could continue indefinitely."
Meanwhile, CEA likely won’t lend its voice to Hitachi’s plea for high court review of the case, Sage Chandler, CEA’s senior director of international trade, told us. CEA hasn’t taken a position in the case, nor has any member company asked it to do so, she said. “We are not weighing in on this one,” Chandler told us.