CIT Denies Importer's Bid to Challenge Ruling on Importation of Marijuana Paraphernalia
The Court of International Trade on July 11 dismissed a prospective importer's challenge to a recent CBP ruling on the admissibility of marijuana paraphernalia (here). CannaKorp had sought to directly challenge the ruling, which had found importation of its CannaCloud vaporizer illegal despite recent changes to state laws (see 1704100026), by bringing its lawsuit before actually importing the product. CIT found that CannaKorp did not demonstrate it was harmed enough by the ruling to challenge CBP's determination pre-importation.
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CannaKorp had attempted to bring suit under 28 USC 1581(h), a provision that gives CIT jurisdiction over challenges to customs rulings before the merchandise is actually imported, but only if the importer "demonstrates to the court that he would be irreparably harmed unless given an opportunity to obtain judicial review prior to such importation." In contrast, most customs cases reach the trade court via jurisdiction under 28 USC 1581(a), which allows for challenges of denied protests on merchandise already imported.
In previous cases, CIT has ruled irreparable harm may be economic injury in the form of "financial loss, reputational injuries, and severe business disruption." But the harm cannot be speculative, which generally precludes cases based on harm to future business arrangements, CIT said.
Here, CIT ruled that CannaKorp failed to clear that bar. CannaKorp attempted to establish harm based on the testimony of its executive, whose declarations contained "numerous vague, speculative, or conclusory statements, and internal inconsistencies, and are otherwise impossible to corroborate," CIT said. CannaKorp provided "no financial records or other documents" to support the testimony, the court said. "Although Plaintiff presents the court with claims of business disruption, financial loss, and reputational harm, the evidence it presents in support of its claims ranges from vague, to inconsistent, to contradictory," CIT said.
(CannaKorp, Inc. v. U.S., Slip Op. 17-83, CIT # 17-00092, dated 07/11/17, Judge Barnett)
(Attorneys: Kristin Mowry of Mowry & Grimson for plaintiff CannaKorp; Guy Eddon for defendant U.S. government)