CIT Properly Ordered Reliquidation of Target's Ironing Table Entries, DOJ Continues to Argue

DOJ's brief continues a case in which the government accused Target of merely attempting to relitigate a previous CIT customs ruling (see 2106220035). Target filed its case in April claiming that CIT's order in Home Products International Inc. v. U.S. and the Federal Circuit's decision to uphold the order to reliquidate the ironing table entries at a higher 72.29% antidumping duty rate were made illegally.

After a decade of litigation in Home Products -- a case Target was not party to -- CIT settled on the 72.29% rate and ordered CBP to liquidate the relevant entries at that rate. However, CBP erroneously liquidated 224 of those entries, including 40 of Target's, at a 9.47% antidumping rate. CBP alerted the court to this error and the court ordered reliquidation in response, even though the 90-day deadline for voluntary reliquidation had passed. Target's appeals of the reliquidation order were denied.

The retailer is now calling for the court to reconsider Home Products, arguing that 19 USC 1501 precludes the court from enforcing its judgment and that the court's decision violates the Federal Circuit's ruling in Cemex, S.A. v. U.S. In Cemex, the appellate court dealt with other erroneous liquidations and found that after 90 days, liquidation becomes “final and conclusive upon all persons.” DOJ argued, and continued to do so in its Aug. 13 brief, that the Cemex case involved a host of procedural deficiencies in CBP's notice to the court that are not present in Target's case. DOJ moved to dismiss the case and was met with a response by Target.

DOJ argued that CIT's order in Home Products was not precluded under Sections 1501 or 1514, as Target suggests. Per various Federal Circuit rulings, these two provisions listed by Target do not limit CIT's inherent power to enforce its judgments through reliquidation, DOJ said. For instance, Target argued that the Home Products decision was “on all fours” with the Cemex decision due to their similarities. However, none of the entries in the Home Products case was deemed liquidated as happened in Cemex, DOJ said. “Based on this difference alone, Home Products is not on all fours with Cemex, as Target contends,” DOJ said.

The retailer said DOJ's motion to dismiss was procedurally improper since the defense should have filed a motion for judgment on the pleadings or for summary judgment. “The ultimate relief Target seeks here has already been sought and it has already been denied,” DOJ replied. “Nonetheless, Target asks the Court to reach a different result here than it did in Home Products, but for essentially the same reasons previously presented to the Court. Because Target’s complaint presents no new factual considerations or legal arguments for the Court to revisit the concluded litigation, it is procedurally proper that this action be dismissed for failure to state a claim upon which relief may be granted pursuant to Rule 12(b)(6).”

DOJ and Target also disagreed on whether the case should be tossed on res judicata grounds. Target says it shouldn't because the retailer wasn't party to the Home Products litigation. “This is not true,” DOJ replied. “Although Target was not a party to the merits portion of the Home Products litigation (and nor did it seek such status), the Home Products litigation remained open for nearly two years after the Court initially ordered reliquidation in October 2017 specifically so that Target, as a nonparty participant to the supplement enforcement proceedings, could present argument against reliquidation -- argument that the Court duly considered and ultimately rejected.”