District Court Dismisses Denied Entry Claim, Declares CIT Rightful Jurisdiction
The U.S. District Court for the Western District of Washington dismissed a Washington importer's claim that its products were unfairly denied entry to the U.S., finding instead that the case belonged in the Court of International Trade. Judge Thomas Zilly, in an April 16 order, ruled that CIT has exclusive jurisdiction for such claims as the one Keirton USA Inc. brought to the district court. “CBP argues that the Court of International Trade ('CIT') has exclusive jurisdiction over this action,” Zilly wrote. “The Court agrees.”
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Keirton, a manufacturer of machinery used to harvest hemp, kale, hops and other farm goods, had troubles with CBP dating back to 2012. According to the complaint, Keirton first had a shipment of its signature product, Twister Trimmers, seized in 2012 by CBP on the basis that it constituted “drug paraphernalia.” The matter was resolved via a nonconfidential settlement, and another government agency sold a part of the seized machines through an online auction in Florida, Keirton's lawyer said in the complaint. From 2012 to 2019, no additional shipments of any Keirton parts were seized until May 2020. In the months that followed, CBP detained more than $1 million in Keirton shipments, alleging again that the merchandise was to be used for illegal purposes.
Following additional litigation and a $180,000 settlement payment Dec. 31, 2020, CBP said it would halt seizures of the Washington company's merchandise and “cooperate and provide all necessary assistance to Keirton so that the third-party storage facilities release” the goods “so it can complete assembly and fabrication and take the completed units to market,” the complaint said. Weeks later, CBP circumvented this by denying Keirton products entry to the U.S. rather than seizing them, Keirton said. CBP said it was unable to make an admissibility declaration for the goods, while Keirton said that the products were no different from the ones imported from 2012 to 2019, and even ones in shipments that were not seized in 2020 and 2021.
The company said continued aggressive action by CBP will run the manufacturer out of business and that these actions by CBP should be curbed. “The public has an interest in preventing agency overreaching, prevent[ing] inconsistent agency action, in the preservation of legally operated businesses that conduct import and export businesses, and in a clear interpretation of the statute and its lawful application,” Keirton said.
“Here, Keirton’s claim for injunctive relief is raised in response to CBP’s exclusion decision and is the vehicle by which it seeks to prevent CBP from excluding future shipments,” Judge Zilly said in the opinion. “This constitutes a challenge to CBP’s decision to exclude its merchandise, which is precisely the type of action regularly adjudicated by the CIT and the Federal Circuit within the statutory scheme,” he said. “Given that Keirton is challenging the merits of whether CBP may exclude its future shipments from entry into the United States, the CIT’s experience in interpreting exclusion orders can be brought to bear on Keirton’s claims.”