Slip Op. 04-61 UNITED STATES COURT OF INTERNATIONAL TRADE

BEFORE: GREGORY W. CARMAN

XL SPECIA

LTY INSURA

NCE CO. (Surety for Cosmos Electronics Co.), Plai ntiff,

v. UNITED STATES OF AMERICA, Defendant. Court No. 01-00900

[Defendant’s Motion to Dismiss for lack of subject matter jurisdiction is granted. Plaintiff’s Motion for Leave to Amend[] or Supplement Complaint is denied.] Jeffrey S. Kranig, Schaumburg, Illinois, for Plaintiff.
Peter D. Keisler , Assistan t Attorne y G eneral ; David M. Cohen , Director, Commercial Litig ation Br

anch, Civil Division, United Sta tes Depa rtment of Justice; Barbara S. Williams , Attorney in Charg e, I

nternat ional Tra de Field Office , Commerc ial Li

tigation Branch, Civil Division, U

nited State s Depar

tment of Just

ice; James A. Curley , Attorney, Commercial Litigation Branc

h, Civil Division, United States Department of Justice; Michael W. Heydrich , Attorney, Off

ice of Assistant Chief Counsel, United States Bureau of Customs and Border Protection, of Couns el, for D efenda nt. Dated: June 8, 2004

O PINI ON
C ARMAN , Judge: Pursuant t o USCI T Rule 12(

b)(1), D efenda

nt moves to

dismiss this action for lack of subject matter jurisdiction. Plaintiff, XL Specialty I

nsurance Co. (Surety

for Cosmos Electronics Co.) (“XL Speciality ”), alleges jurisdiction under 28 U.S.C. § 1581(a) (2000). Defendant argue s that XL Specialty failed to file a proper protest. Plaintiff opposesCourt No. 01-00900 Page 2

1 Plaintiff ’s compla int is mis-nu

mbered. For the p

urposes o f citation, this Cour t refers to paragraphs of the complaint as numbere d from the first paragraph. Defendant’s motion and moves, pursuant to USCIT Rule 15(a ), for leave to amend its complaint. This Court has jurisdiction to resolve this matter under 28 U.S.C. § 1581(a). As discussed below, this Court grants Defendant’s Motion to Dismiss because Plaintiff’s protest is not sufficient to satisfy the re gulatory and statutory requir

ements for validity. Plaintiff’s re quest for leave to amend its complaint is denied.
B ACKGROUND The subject entries of color television receivers ma nufactured in South Korea by Cosmos Electronics Co. Ltd. were e ntered in April 1987 and May 1987. (Compl. ¶¶ 5-6 1 ; Def.’s Br. in Reply to Pl.’s Opp’n to Def.’s Mot. to Dismiss (“Def.’ s Reply”) at 3.) A t the time of entry, the subject merchandise was subject to an administrative antidumping duty review for the period April 1, 1987, through March 31, 1998. (Compl. ¶ 8; Def.’s Reply at 3.) Under that administr ative re view, the entries were subj ect to ce rtain importer-sp ecific a

ntidumping

duty rates. (Compl. ¶ 8.) On April 21, 2000, the United States Customs Service, now organized as the Bureau of Customs and Border Protection (“ Customs”), liquidated the subject entries and assessed a supplemental antidumping duty rate of 4.51% ad valorem . ( Id. ¶ 13.) On July 12, 2000, af ter the im porter, Cosmos Elec

tronics, refuse d to pay

the supple

mental du ties, Custo ms mailed a demand for pay

ment to XL Specialty

as surety for

Cosmos Electronics. (

Id. ¶ 14; Def.’s Mot. to Dismiss (“Def.’s Mot.”) at 2.)Court No. 01-00900 Page 3

2 “A protest by a

surety which ha s an unsatisfied legal claim under its bond may be filed within 90 days from the date of mailing of notice of demand for pay ment against its bond.” 19 U.S.C. § 1514(c)(3). The notice of demand for pay ment was mailed on July 12, 2000; thus, XL Specialty’s protest, filed 86 da ys later on October 6, 2000, was timely under the statute. On Octobe

r 6, 2000, Plaintiff

filed a ti mely 2 protest challenging Customs’ demand for payment of the suppleme ntal duties. (Protest No. 3001-00-100339 at 1.) XL Specia lty attached three additional pages to its protest form. ( Id . at 2-4.)

In the additiona l pages , XL Sp ecialty presented several “alternative a rguments” against Customs’ liquidation of the subject entries. ( Id. at 2.) The

releva nt portion of the pr otest is be low. The t

wo passa ges ce ntral to the partie s’ arguments are underlined.
II. SURETY’ S PROTEST: Entry Numb ers: Entry Dat e Liquidation

/Bill Date Port 11006442476 05/17/87 04/21/00 3001 11006441338 04/30/87 04/21/00 3001

A. ALTERNATIVE ARGUMENTS - INCORRECT DECISIONS MADE BY THE IMPORT SPECIALIST DURING LIQUIDATION: The sure ty f iles this pr

otest of the liquida

tion deci sions and s

upplemen tal duty bills that relate to the captioned entries upon the belief that there er rors have made in the such deci sions and b ills [s ic].
The surety

hereby f iles this protest against your decision to: reclassify a nd/or reappr aise the subject entries: deny drawb ac k; assess antidumping/countervailing duti es or any ca

lculation of double antidumping duties based upon presumption of reimburs ement, marking duties, or any other special duties, charges or e xaction, including but not limite d to intere st. The sur ety

additiona

lly c laims that

the import

er capp ed and extinguishe d of it s liability [sic] for a

dditi on al antidu

mping dut

ies as all owed unde

r 19 C.F.R

. 351.212(d) an d 19 U.S.C. 1673f(a)(1). To the best of the surety ’s knowledge, the importer may have paid the cash deposit at the applicable preliminary countervailing duty rate in effect between the date of the preliminary a

ntidumping order and the final antidumping order.Court No. 01-00900 Page 4

Surety also protests any cle

r ical error or mistake of fact made that influenc ed the increase in the amounts of duty found due when the entries were liquidated. As this is a protest, surety claims: the merchan dise is properly appr aised at the invoice unit value s and th at the values that were used as the basis for the supplemental dut ies we re exces sively high, the

classifi cation a

nd the duty

rate submit tedby the import

er at time of entry are cor rect; the entry is not subje ct to antid umpi ng/ co untervai ling duti es, that even if the entries are subject to the antid umping or counte

rvailing duties, th e rate u sed at liqu idation did

not a pp ly t o entries in question [sic] and that there was no reimbursement of antidumping duties paid prior to or received by

the importer of record, or any other special duties, charg es or exaction, inclu ding but n

ot limited to

interest

. Ad di ti on al ly, on information and belief, the surety claims that entries were liquidated after the 6 month or 90 day statutory deadline imposed by 19 U.S.C. 1504(d) , that the entries were not within the scope of the antidumpi n g/countervailing duty case that Customs relied u

pon to dete

rmine tha t suppleme

ntal duties are due, and that other errors were made in the de terminat ions that supplemental duties are due for the captione d entrie s. Surety is present ly g atherin

g the inf ormation a

nd eviden ce nece ssary

to establi shour claims. Upon rece ipt of the documents and information, we will supplement the claims made in this protest with additional information as appropriate. ( Id. at 2-3 (emphasis added).) On February

8, 2001, as a “supplement” to its protest, Plaintiff filed a letter which stated that the subject entries, imported by Cosmos Electronics, were incorrectly assessed the supplemental antidumping duty ra te that applied to Cosmos Communications , an unaffiliated Florida corporation. (L etter from Jeffrey S. Kranig, Counsel to XL Specialty Insurance Company to Customs of 02/08/01 (“February Letter”) at 1.) Customs denied Plaintiff’s protest on April 19, 2001. (Protest 3001-00-100339 at 1.) As

ex pl an at io n f

or th e d en ia l, a C us to ms of fi ce r w ro te : “ De ni ed : E nt ry Li qu id at ed ti me ly & correctly .” (

Id. )Court No. 01-00900 Page 5

3 Deemed liquidation is provid

ed for in 19 U.S.C. § 1 504(d): when a suspension required by

statute or court or der is re moved, the

Customs Service shallliquidate the entry, unless liquidation is extended. . . within 6 months after receiving notice of the removal from the Department of Commerce . . . . Any entry

. . . not liquidated by the

Customs Service within 6 months after receiving such notice shallbe trea

ted as ha ving be en liquida

ted at the rateof du ty, value, quantity, and amount of duty asserte d at the time of entry by the importer of record. 19 U.S.C. § 1504(d). On October 15, 2001, Plaintiff filed a summons in this Court challenging Customs’ denial of its prot est base d on “the C

ustoms Off

icer’s m istake re gardin

g applic able ant

idumping duty rate to be assessed to Cosmos Electronics Co. entries,” and “the Customs Officer ’s mistake regarding the dee

med liquidation status of the entries under [19 U.S.C. §] 1504(d). 3 ” (Summons at 2.) On April 29, 2003, Plaintiff filed its complaint alleging that the subject entries we re incorrectly

assessed the supplemental antidumping duty rate that applied to Cosmos Communications, an unaffiliated Florida corporation. (Compl. ¶¶ 7, 13.) Plaintiff’s complaint did not allege that the subject entries were de emed liquidated under § 1504(d). After two extensions of time in which to answer were granted, De fendant filed its Motion to Dismiss on October 30, 2003. ( See Def.’s Mot. at 8.) As detail ed in Plain

tiff’s c ontention s below, the bulk of Pl aintiff’ s opposition to Defend ant’s Moti on to Dismis s rests on Plaintiff ’s asser tion that it s protest was valid b ecause it contained a sufficient deemed liquidation claim. (See Pl.’s Resp. to Def.’ s Mot. to Dismiss (“Pl.’s Opp’n”) at 1-6.) After revie wing the parties’ submissions, this Court asked for further briefing on the issue of whether Plain tiff’s c ontention

that its pr

otest was sufficie nt based on its deemed liquidation claim was effected by the fact that Plaintiff did not allege deemed liquidationCourt No. 01-00900 Page 6

in its complaint. ( See Lett er t o C oun sel fro m t he c ham ber s of Ju dge Car man of 0 3/ 30/ 04. ) In response to that letter, Plaintiff filed a Motion for Le ave to Amend[] or Supplement Complaint (“Pl.’s Mot. to Amend”) asking to add a deemed liquidation claim. (Pl.’s Mot. to Amend at 1.) Defendant opposes Plaintiff’s request to amend its complaint.
D ISCU SSI ON As the party see

king to invoke this Court’s jurisdiction, XL Specialty bears the burden of establishing jurisdiction. See Old Republic Ins. Co. v. United States , 741 F. Supp. 1570, 1573 (Ct. Int’l Tr ade 19 90) (ci ting McNutt v. General Motors Acceptance Corp. , 298 U.S. 178, 189 (1936)) . XL Sp ecialty

allege s jurisdiction under 28 U.S.C. § 1 581(a). (Compl. ¶ 1 .) Bec ause Defendant’s Motion to Dismiss challenges the factual basis of X L Specialty ’s allegations of jurisdict ion, the a llegat ions in the

complain t are not controlli ng and only

the uncon

troverte d facts will be accepted as true. See SSK Indus., Inc. v. United States , 101 F. Su pp. 2d 825, 829 (Ct. Int’l Trade 2000) (c iting Power-One, Inc. v. United States , 83 F. Supp. 2d 1300, 1303 (Ct. Int’l Trade 1999) and Cedars-S inai Med. Cntr. v. W

alters , 11 F.3d 1573, 1583-84 (Fed. Cir. 1993)). All other facts underly

ing jurisdiction “are subject to fact-finding by this Court.” Id. Under 28 U.S.C. § 1581(a), this Court has “exclusive jurisdiction of any civil action commenced to contest the denial of a protest, in whole or in part, under section 515 of the Tariff Act of 1930.” 28 U.S.C. § 1581(a). “Therefore a prerequisite to jurisdiction by the Court is the denial of a valid protest.” Volkswagen of Am., Inc. v. United States , 277 F. Supp. 2d 1364, 1367 (Ct. Int’l Tr ade 20 03) (ci ting Washington Int’l Ins. Co. v. United States , 16 Ct. Int’l Trade 599, 601 (1992)); see also Koike Aronson, Inc. v. United Sates , 165 F.3d 906, 908 (Fed. Cir. 1999) (“By its terms, section 1 581(a) l imits the jur isdiction o f the Cour

t of I nternat ional Tra de toCourt No. 01-00900 Page 7

appeals from denials of valid protests.”).
In or der for a protes t to be val id, it must sa tisfy the statut ory and reg ulatory require ments set forth in 19 U.S.C. § 1514(c) and 19 C.F.R. § 174.13(a). I n addition to other formal requirements, § 1514(c)(1) states that “[a] protest must set forth distinctly and specifically

. . . each decision . . . as to which protest is made; . . . the nature of ea ch objection and the reasons therefor; and . . . any

other matter required by

the Secretary

by reg ulation.” 19 U.S.C. § 1514(c)(1). Regulation § 174.13 states that “[a] protest shall contain the following informa tion . . . [t]he na

ture of, and justif

ication f or the obj ection se

t forth dis tinctly

and spec ifically

with respect to each categ ory, pay ment, claim, decision, or refusal.” 19 C.F.R. § 174.13(a)(6).
P ARTIES ’ C ONTENTI ONS I. Defendant ’s Motio n to Dism iss. A. Defen dant’s Con tentions. Defendant contends that this Court lacks subject matter jurisdiction over this action because Plaintiff’s protest does not meet the statutory and regulatory

requirements for validity

. (Def.’ s Mot. at 5. ) Specif ically, Defen

dant cont ends that Plaintiff ’s prote st failed

to set for th distinctly and specifically , “the nature of each objection and the re asons therefor” as required by statute. ( Id. (quoting 19 U.S.C. § 1514(c)(1)(C)).) Further, Defendant asserts that Plaintiff’s protest failed to specify

the “justification for each objection set forth distinctly and specifically ,” as required by

Customs’ regulations. (

Id. (citing 19 C.F.R. § 174.13(a)(6)).) Def endant contends that XL Specialty ’s protest “failed to state any reason for the objections that would have allowed Customs to decide whether it had incorrectly liquidated the entries.” ( Id. )Court No. 01-00900 Page 8

Defendant characterizes Plaintiff’s protest as a “blanket protest” that merely listed every possible o

bjection to Customs’ liquidation and did not include any reasons to support

those objections. (Def.’s Mot. at 6.) Defendant contends that “[s]uch a blanket prote st undermines the administr ative re medy provided by C ongre ss becau se it does not give Customs an o

pportunit y to correct its mistakes.” (

Id. (citi ng Davies v. Arthur , 96 U.S. 148, 151 (1877)).) To highlight the protests’ “all encompassing nature,” De fendant contends that “[m]ost of the objections in the protest have nothing to do with Customs’ liquidation of the entries in issue.” ( Id. at 6 n.2.) Defendant notes that Plaintiff protested Customs’ decision to deny drawback and assess marking duties, yet “the importer ne ver applied for drawback . . . and Customs did not assess marking duties on the entries.” (

Id. (citing Protest No. 3001-00-100339 at 2-3).) Defenda nt argues that the administrative “policy be hind the protest procedure . . . will be undermined” if Plaintiff’s protest is held to be valid in this case. (Def.’s Reply at 10.) In its Reply Brief, Defend

ant addr esses Pla intiff’s two centr

al conte ntions: 1) t

hat its protest w as valid b ecause it contained a suff

icient de emed liqu

idation c laim; and 2 ) that its protest was valid because it contained a sufficient wr ong assessment rate claim. (Def.’s Reply at 2-6 (referencing Pl.’s Opp’n a t 3-6).) Defendant contends that these statements “a re objections to Customs’ decision, not reasons why Customs’ decision to assess antidumping [duties] was incorrect.” (

Id . at 2.) First, De fendant

counters Plaintiff

’s conte ntion that t

he prote st was val id based on its objection to “Customs’ decision . . . to assess antidumping/ countervailing duties” because “the entries were liquidated after the 6 month . . . statutory deadline imposed by 19 U.S.C. 1504(d).” ( Id. at 2 (citing Pl.’s Br. at 3 (in turn citing Protest No. 3001-00-100339 at 2- 3).) DefendantCourt No. 01-00900 Page 9

asserts that the quoted protest language is “merely a

statement of [Plaintiff’s] claim,” and “offers

no reason why

the entries liquidated in accordance with § 1504(d).” ( Id. at 4.) Defendant contends that Plaint

iff’s de emed liqu

idation c laim cann

ot be a “r eason” f or prote sting Cust

oms’ decision to assess antidumping duties because, even if the entrie s were deemed liquidated, antidumping duties would still be assessed by Customs at the rate entered. (Def.’s Reply

at 3.) Additionally, Defenda

nt contends that the deemed liquidation statement in Plaintiff’s protest c annot be t

he basis f or validit y be cause it

failed to set forth any of the re quired e lements for dee med liquida

tion as “r easons” for the d eemed liq uidation o

bjection . (Def. ’s Reply at 4.) Defendant contends that courts have held that “in orde r for a deemed liquidation to occur, (1) the suspension of liquidation that was in place must have been removed; (2) Customs must have received notice of the removal of the suspension; (3) Customs must not liquidate the entry at issue within six months of receiving such notice.” ( Id. (quot ing Fujitsu Gen. Am., Inc. v. United States , 283 F.3d 1364, 1376 (Fed. Cir. 2002)).) Defenda nt contends that Plaintiff’s protest failed “to state any fact tha t relate s its claim u

nder § 15 04(d) to Cu stoms’ liqu idation of the entr ies in issue.” ( Id. at 5.) Defendant contends that “[i]n the absence of such informa tion, the plaintiff has not stated a reason why Customs’ liquidation decision was incorrect, and does not give Customs the information necessary to correct [its decision] if warranted.” ( Id. ) Second, Defendant addresses Plaintiff’s contention that its protest was valid base d on a wrong assessment rate claim. ( Id. at 5; Def.’s Reply a

t 6-7.) Defendant stresses that even if the statement that “the rate used at liquidation did not apply to entries in question” could be construed to state an objection, the protest is still invalid “because it does not state the reasons why the rate used by Customs did n

ot apply to the ent ries in question.”

(Def.’ s Mot. at 7Court No. 01-00900 Page 10

(quoting Protest No. 3001-00-100339 at 2).) Although Plaintiff arg ues that Customs had the opportunity to inquire further a bout this issue, Defendant asserts that “Customs had no better reason to investigate [the wrong assessment ra te] objection than the dozen or so other objections raised in the prote st.” (De f.’s Repl y a t 7.) Def endant c ontends that “the f ailure o f a prote st to include the necessary

reasons cannot be cured . . . by arguing that Customs could have conducted an investigation to obtain the missing information.” (Def.’s Reply at 8-9.) Defendant contends that because Plaintiff failed to state a reason why “the rate used at liquidation did not apply to the entries i n question ,” (Prote st No. 3001 -00-1003 39 at 2), t he prote st was inva

lid under the statut e and regulation. (Def.’s Reply at 7-8.) Next, Def endant a ddresse s Plaintiff

’s Febr uary Lette r which c ontained

certain facts regarding the wrong

assessment rate claim. (Def.’s Mot. at 5-6.) Def endant contends that Plaintiff attempted to amend its protest with the additional information contained in the February Letter. ( Id. at 6 n.1) Defendant notes that a protest can be a mended “to include objections . . . that were not the subject of the original protest,” but asse rts that these objections “must be made before expiration of the 90-day period in which the protest could have been filed.” ( Id. (citing 19 U.S.C. § 151 4(c)(1 )).) De fendant contends that the F ebruar

y Letter “c annot cur

e the def ects in the protest” because the letter was not filed within 90 day s of the demand for pay

ment as required by statute. (

Id . at 5.) Further, Defendant asser ts that the February

Letter cannot qualify

as “new grounds in support of objections raised by a valid protest” because the protest was not valid when it was filed with Customs for the reasons given above. ( Id. at 6 n.1 (quoting 19 U.S.C. § 1514(c)(1)).) Defendant contends that the statement in the protest that Plaintiff “is presently gatheringCourt No. 01-00900 Page 11

the infor mation and evidenc e neces sary to establi sh our cla

ims,” indic ates tha

t when the

protest was file d, Plaintif

f did not ha

ve a rea son to suppo

rt its obje ctions an

d would inf

orm Customs later of the reason. (

Id. at 6.) Defendant asserts that Plaintiff did not afford Customs the opportunity to correc

t its mistakes because Plaintiff failed to submit the necessary “reasons” for its objections when it filed its protest. ( Id. ) Defendant contends that Plaintiff included “every conceivable gr

ound for c

hallenging [Custom s’] decisi on with the hope or expectation

that a reason eventually

would be found.” (Def.’s Reply at 7.) B. Plaintif

f’s Conten tions. Plaintiff contends that its protest fulfilled all the statutory and re gulatory requirements for validity . (Pl.’s Op

p’n at 1.) Plaintiff asserts t hat its protest is suf

ficient b ecause

it objecte d to Customs’ decision to assess antidumping duties based on two claims set forth in the protest: 1) a deemed liquidation claim; and 2) a wrong assessment rate claim. ( Id. at 3, 6.) First, Plaintiff draws the Court’s attention to the statement in its protest that Plaintiff objected to Customs’ “decision to . . . assess antidumping/countervailing duties” beca use “the entries were liquidated after the 6 month . . . statutory deadline imposed by 19 U.S.C. 1504(d).” ( Id. at 3 (quot

ing Prote st No. 3001 -00-1003 39 at 2-3) .) Plaintif f conten ds that this

statemen t is a sufficient “reason” for objecting to Customs’ decision. (

Id. ) Plaintif

f conten ds that this statement’s “lack of details is not a fatal flaw.” ( Id. at 4.) Pla

intiff ac knowledg es that thi s statement does not provide the underly ing facts, but asserts that the statement is a sufficient reason for its objection. ( Id. (“The f

act that t he state ment does

not provid

e either the in depth chronology

of the six month liquidation period or of the gap between the expiration of that period and the liquidation date does not make the statement something other than a re ason for theCourt No. 01-00900 Page 12

plaintiff’s protest objection.”).) Plaintiff contends that the court has rejec ted the contention that “the abs ence of

precise facts” renders a prote st invalid

. ( Id. at 4-5 (citi ng Volkswagen , 277 F. Supp. 2d at 1369).) Plaintiff asserts t hat the sufficien

cy of the de emed liqu

idation c laim “as a

protest objection and reason therefor” is further bolstered by the fa

ct that the Customs officer “respond[ed] to the claim in the protest decision.” ( Id. at 5.) Plaintiff contends that “the import special[ist] signed the protest denial decision in part because he believed tha t the entry was ‘liquidated timely.’” (

Id. (citing Protest No. 3001-00-100339 at 1).) Plaintiff asserts that the deemed liquidation claim was sufficient to “allow[] Customs the opportunity to review the do cu me nt at io n i n t he li qu id at ed en tr y fi le s t o d et er mi ne wh et he r t he li qu id at io n w as ti me ly” because Customs’ records contained the “date s of entry, the a ntidumping case number, the importer and exporter names, and the date of liquidation.” ( Id. at 6.) Pla

intiff contends tha

t this information made it “relatively simple” for Customs to conduct an investigation “to determine the trigger date for the

liquidation period provided by 19 U.S.C. § 1504(d), the date of expiration of that six month period, and the timeliness of the liquidation with respect to the expiration of the six month period.” (

Id .) Second, Plaintiff asserts that the “main issue in this case is the claim that Customs used the wrong assessment rate to liquidate the entries.” ( Id .) Plaintif

f conten ds that its protest is valid because this claim was also sufficiently set forth in the protest: “even if the entries are subject to antidumping or countervailing duties, the rate used a t liquidation did not apply to the entries in question.” (

Id. (quoting Protest No. 3001-00-100339 at 3).) Plaintiff contends that “the protest’s reference to the inapplica bility of the antidumping rate . . . was sufficient to meetCourt No. 01-00900 Page 13

the protest validity require ments provided in 19 U.S.C. § 1514(c)(1)(C).” ( Id. at 7.) Plaintiff contends that minimal additional investigation was necessary for Customs to determine if an incorrect duty

rate had been applied because “ Customs merely needed to . . . c ompar[e] the importer ’s name on the entr y do cuments to

the import

er name s on the liq

uidation in struction s to ascertain that the rate used at liquidation pertained to Cosmos Communications, not Cosmos Electronics.” (

Id. ) Plaintiff asserts that, based on the languag e in the protest and the information contained in the entry

file, “Customs had the opportunity to perfor m the investigation of a specific question.” (

Id .) Plaintif

f conten ds that “[i]t i s irrele

vant to the

issue of protest va

lidity that Customs[’] discretion or administrative protocols or priorities may have re quired more information before Customs would ever have agr eed to perform the inquiry and further investigate the applicability of the rate.” (

Id .) Plaintiff claims that Defendant clouds the issue by drawing attention to Plaintiff’s statement in the protest that the surety “ is presently g athering the information and evidence
necessary to establish our claims.” ( Id. at 9 (quoting Protest No. 3001-00-100339 at 3).) Plaintiff contends that “the protest reasons were concr etely provided indepe

ndent of the notice that the surety intended to provide additional information.” ( Id. ) Plaintif

f asser ts that this statement in the protest was “not a notice that the protest lacked rea sons for the objections to the protestable [Customs] decisions.” ( Id .) Plaintif

f conclu des that the “deemed liquida tion claim and the incorrect assessment rate claim in this protest provided Customs with defined course s of inquiry to pursue to determine w hether the claims had merit.” ( Id .) Alternatively, Plaintiff contends tha t “[a]t a minimum,” the protest raised a sufficient objection and the “specific facts” in the Fe bruary L etter “provided new grounds in supportCourt No. 01-00900 Page 14

thereof in accordance with 19 U.S.C. [§] 1514(c) and the Pagoda and Fujitsudecisions.” ( Id. ) Plaintiff states that the February Letter “was a timely

filed supplement to the objection already raised in the protest here just like the protest and supplement in Pagoda .” ( Id. ) Plaintiff cites Pagoda Trading v. United States , 804 F.2d 665 (Fed. Cir. 1986), to argue that unde r § 1514(c), this Court should find that the February Letter was a timely

“new ground” in support of the wrong assessment rate objection alrea dy raised in the prote st. ( Id. at 3, 9.) Plaintiff contends the because the February

Letter “did not challeng e a different ‘decision,’ but merely raised a ‘new ground’ in support of the objections in the original protest,” the letter “did not have to be filed within the 90-day per

iod.” ( Id. at 3 (q uoti ng Pagoda , 804 F.2d at 668).) Plaintiff concludes that be ca us e i ts pr ot es t w as su ff ic ie nt to sa ti sf

y th e s ta tu to ry a nd re gu la to ry r eq ui re me nt s f or va li di ty, Defendant’s Motion to Dismiss should be denied. ( Id . at 9-10.)
A NAL YSIS I. Defendant ’s Motio n to Dism iss is Gra nted. This Court holds that Plaintiff’s protest failed to meet the statutory and r egulatory requirements for sufficiency of protest. Therefore, this Court lacks jurisdiction over this case, and Defendant’s motion to dismiss is granted. “[D]enial of jurisdiction for insufficiency of protest is a severe action which should be taken only sparingly .” United Sta tes v. Par ksmith Corp. , 514 F .2d 10 52, 10 57 (C. C.P. A. 197 5) (qu otin g Eaton Mfg. Co. v. United States , 469 F.2d 1098 (C.C. P.A. 1972) ). “The court g eneral ly c onstrues a protes t in favor

of findin g it valid unless the protest ‘ gives no

indication of the r

easons why

[Customs’] action is alleged to be erroneous.’” Sony Elecs., Inc. v. United States , No . 98 -07 -02 438 , 20 02 C t. Int’ l Tr ade LEXIS 20, at *6 (Ct . Int’l T rade Feb . 26, 2 002) ( empha sis ad ded) (c itin g Koike Aronson , 165 F.3d atCourt No. 01-00900 Page 15

908) ( in tu rn quo ting Washington Int’l Ins. Co. , 16 Ct. Int’l Trade at 602). Althoug h protests are to be liberally construe d, Mattel, Inc. v. United States , 377 F. Supp. 955, 960 (Cust. Ct. 1974), that “ does not

. . . mean t

hat prote sts are a

kin to notic e pleadi

ngs and merely have to se

t forth fa ct ua l a ll eg at io ns wi th ou t p ro vi di ng an y underlying reasoning ,” Computime, Inc. v. United States , 772 F.2d 874, 879 (Fed. Cir. 1985) (emphasis added). Section 1514(c)(1) states that among other re quirements, A protest must set forth distinctly and specifica lly – (A) eac h decision . . . as to w

hich prot est is made ; (B) ea ch cate gory

of merchandise a

ffecte d by each de cision . . . ; (C) the nature of each objection and the re asons therefor; and (D) any other matter required by

the Secretary

by reg ulation. 19 U.S.C. § 1514(c)(1). Customs’ regulations require that a protest include “ [t]he nature of, and justification for the objection set forth distinctly and spe cifically with re spect to each . . . decision .” 19 C.F .R. § 174.1 3(a)(6 ). In apply ing the s tatutory

and reg ulatory require ments, courts ha ve held that “[a] pro test must be sufficie ntly distinct a nd specif ic to ena ble the Customs Service to know what is in the mind of the protestant.” Parksmith Corp. , 514 F.2d at 1057; see also Eaton Mfg. Co. , 469 F.2d at 1098. T

he Supre me Court ha s ruled th at: Protests. . . must

contain a distinct and clear specification of each substantive g round of objectionto the payment of the duties. Te chnical precision is not required; but the objections must be so distinct and specific, as, when fairly construed, to show that the objection taken at the trial was at the time in the mind of the importer, and that it was sufficie

nt to notify

the colle ctor of it s true nature and character to the end that he might ascertain the precise fa cts, and have an opportunity to correct the mistake and cure the defect, if it was one which c ould be obviated. Davies v. Arthur , 96 U.S. a t 151; s ee also , Mattel, Inc. , 377 F. Su pp. at 960 (A prote st is sufficie nt “for p urposes o f [19 U.S.C. § 1514,] if it c onveys enoug h informa tion to appriseCourt No. 01-00900 Page 16

knowledgeable officials of the importer’ s intent and the relief sought.”). Here, the parties agre e that Plaintiff’s protest stated the decision that was being protested: Customs’ de cision to a ssess supp lemental antidumpin

g duties . (Pl.’s Op

p’n at 3, 6 ; Def.’s

Reply at 2-3.) However, the parties disag ree whether the two passage s in the protest highlighted by Plaintiff merely stated “

the nature of the objection,” as Defenda nt claims, (Def.’s Mot. at 5-7), or whether the two passages sufficiently stated “the nature of the objection and the reasons therefor,” as Plaintiff contends, (Pl.’s Opp’n at 8). See 19 U.S.C. § 1514(c)(1)(emphasis added). This Court h

olds that Pla

intiff’s protest me

rely stated the

nature o f its objec

tions to Cust

oms decision to assess duties. Therefor

e, this Cour

t holds tha

t Plaintiff ’s prote st was not valid because it failed to state distinctly and specifically

the reasons or justifications for its objections to Customs’ decision as required under the statute and regula tion. See 19 U.S.C. § 1514(c); 19 C.F.R. § 174.13(a)(6). This Court holds that it is not possible to determine the reasons or justifica tions for P laintiff

’s objections from

the text of t

he prote st. See Ammex Inc. v. United States , 288 F. Su

pp. 2d 1375 , 1382 (Ct. Int’ l Trade 2 003). Thi s Court fur ther hold s that ther

e is no possible construction of the language of the protest that would indicate that the protest gave the Customs

officia l review ing the protest suf

ficient i nformati on such tha

t the offi cial cou

ld correct any

mistakes in liquidation.
1. Plain tiff ’s Prote st is N ot Val id Ba sed on its De emed Li quid ation Clai m. Plaintiff’s deemed liquidation claim is not sufficient under 19 U.S.C. § 1514(c)(1) and 19 C.F.R. § 174.13(a)(6); thus, the deemed liquidation claim cannot be a basis for holding Plaintiff’s protest v alid

. Apply

ing the s tatutory

require ments to Pla

intiff’s deemed l iquidation

claim, Plaintiff ’s prote st stated t

he decis ion that wa s being p rotested : “[Customs’ ] decision t o . . . asse ssCourt No. 01-00900 Page 17

antidumping/countervailing duties.” (Protest No. 3001-00-100339 at 2.) The protest also stated the nature of the objection to that decision: “the entries were liquidated after the 6 month . . . statutory deadline imposed by 19 U.S.C. 1504(d).” (

Id . at 3.) However, Plaintiff’s protest does not fulfill the requirement that a protest state the “reasons” a nd “justifications for the objection.” See 19 U.S.C. § 1514(c)(1)(C); 19 C.F.R. § 174.13(a)(6). Plaintiff’s protest failed to provide “any underlying

reasoning” for its deemed liquidation objection. Computime , 772 F.2d at 878. Plaintiff’s protest failed to state why the entries were deemed liquidated. Plaintiff’s protest did not indicate that there was a suspension of liquidation, when and if that suspension had been removed, or if Customs had rece ived notice of the removal. See Fujitsu Gen. Am. Inc. , 283 F.3d at 1376. This Court is not persuaded by Plaintiff’s argument that the underlying

reasoning could have been dete rmined by Customs with minimal investigation. ( See Pl.’s Opp’n at 6.) Under the statute, Plaintiff clearly bears the burden of setting forth the reasons and justifications for its objections to Customs’ decisions. See 19 U.S.C. § 151 4(c)(1 ) (“[a] pr otest must

set forth distinctly and specific ally . . . the rea sons theref or.” (e mphasis a dded)); see also Washington Int’l Ins. Co. , 16 Ct. Int’l Trade at 604 (finding the plain tiff’s pr otest inva lid for fa ilure to pr ovide re asons for

its object ion to Custom s’ classification and stating that “[a]ny other ruling by

this court would . . . effectively require Customs to scrutinize the entire administrative record of every entry in order

to divine potential objections and supporting arguments which an importer me ant to advance.”). This Court r

ecogn izes that lib eral construction of the va lidity require ments is g eneral ly afford ed to prot ests, but notes that c ourts hav e not hesi tated to f ind prote sts invalid

if the protest “gives no indication of the reasons why the collector’s action is alleged to be err oneous.” KoikeCourt No. 01-00900 Page 18

Aronson , 165 F .3d at 908 (e mphas is add ed) (qu otin g Washington Int’l Ins. Co. , 16 Ct. Int’l Trade at 602); see also Ammex , 288 F. Supp. 2d at 1381-82 (finding that the plaintiff’s protest “neither states the ‘reasons’ for the objection, 19 U.S.C. § 1514(c), nor does it ela borate on the ‘justification for [the] objection set forth distinctly and specifica lly,’ 19 C.F.R. § 174.13(a)( 6)”). Further, this Court is not persuaded by Plaintiff’s contentions that the protest “must have been sufficiently

informative,” because of the written response of the Customs official on the protest form. ( See Pl.’s Opp’n at 5.) In rejecting similar arguments, the court has held that “[t]he test for d etermini ng the v alidity

and scop e of a pr

otest is obj ective a

nd indepe ndent of a Customs official’s subjective reaction to it.” Sony Elecs., Inc. , No. 98-07-02438, 2002 Ct. Int’l Trade LEXIS 20, a t *5 (c itin g Power-One Inc. , 83 F. Supp. 2d at 1305).
2. Plai ntif

f’s Pro test i s Not V alid Based on it s Wron g Asse ssment Rate Cl aim. Plaintiff’s protest states that: “even if the entries are subject to antidumping duties, the rate used at liquidation did not apply to the entrie s in question.” (Protest No. 3001-00-100339 at 3.) This Co

urt holds that this sta

tement is i

nsuffic ient to fin

d Plaintiff

’s prote st valid

. The protest st ates the objection to Customs’ decision to assess duties: the

rate as sessed di d not apply to the subject entries. However, like the deemed liquidation claim, the protest fa iled to state the “reasons” for its objections. I t is not possible to determine from Plaintiff’s protest any re ason why the rate assesse d did not ap

ply to the subj ect entr

ies. Plain tiff’s sta tement fa ils to set f orth the “justification for the objection . . . distinctly and spe cifically.” 19 C.F .R. § 174.13(a)(6). Arguably , the February

Letter contained the re asons and justifications for Plaintiff’s objection that the assessed rate did not apply to the subject entries. However, under 19 U.S.C. § 1514(c ), a prot

est may only be amend

ed within t

he 90-da y time period

for prot esting Cu stoms’Court No. 01-00900 Page 19

decision. 19 U.S.C. § 1514(c)(1) (“A protest may be amended . . . to set forth objections . . . which we re not the subject o f the orig

inal prote st . . . any

time prior

to the expir

ation of the time in which such protest could have been filed.”). The F ebruary Letter is dated Febr

uary 8, 2001, almost seven months after Customs mailed its demand for pay ment to Plaintiffs and well after the 90-day time per

iod for filing a protest had expired. Therefore , the February Letter cannot not cure the defects in Plaintiff’s invalid protest. Further, this Court holds that the Febr uary Letter does not come “within a recognized exception to the 90-day deadline prescribed by

section 1514(c)(3).” Fujitsu Gen. Am. , 283 F.3d at 1372. Contrary to Plaintiff’s contentions, this Court
cannot a ssert jur

isdiction over Plain

tiff’s wr ong ass essment r

ate cla im as “ne w groun ds in support of objections raised by a valid pro test

. ” 19 U.S.C. § 1514(c)(1). The “new gr ound” exception requires an underly ing valid protest, and, as detailed above, Plaintiff’s protest was not valid bec ause the

protest f ailed to provide the reasons for its o bjection s. 3. Policy Reasons Support the Conclusion Reached by this Court. This Court agrees with Defendant’s cha racterization of Plaintiff’s protest as a “blanket protest.” ( See Def.’s M ot. at 6.)The lang uage o f the pro test seem s to indica te that Pla

intiff did not know the reasons or justif ications for its protest at the time that the protest was filed. Such a blanket protest does not further the objectives of the administrative proce ss. The court has already rejected the “blanket” method of protest that Plaintiff employ ed in this case. See Washington Int’l , 16 Ct. Int’l Trade at 605. I n Washington International , the court rejected the plaintiff’s argument that checking a box that stated that it challenged the classification of the merchandise was sufficient for a valid protest unde r 19 U.S.C. § 1514(c). Id. at 6 02- 03. In rejecti ng the p laintiff

’s arg ument, the

court sta ted thatCourt No. 01-00900 Page 20

as a matter of policy

plaintiff’s argument cannot be countenanc ed. Under plaintiff’s interpretation, an importer could simply chec k every available objection

listed on the protest, and then s

ubmit at its

leisure a ‘supplemental’ letter containing the reasons for the objections anytime prior to the resolution of the pr

otest. Such a resul

t would surely ‘thwar

t the scheme of orderly

claim assessment envisaged by § 1514.’
Id. at 605 (emph asis a dded) (quot ing CR Indus. v. United States , 10 Ct. Int’l Trade 561, 565 (1986)) . In e ffect, that is wha t Plaintiff has done here. Pla

intiff list ed “eve ry availab le objection” to decision of the Customs official and then submitted a “supplemental” letter months later. Id . Such a protest is invalid under the statutory a nd regulatory

requirements and does not further the “orderly

claims assessment” mandated by Congress in 19 U.S.C. § 1514. Id

. II. Plaint

iff’s Motion

to Ame nd its Complaint is De nied. Having determined that this Court is without jurisdiction under 28 U.S.C. § 1581(a), granting Plaintiff leave to amend its pleading s in this case would be futile because any such amendme nt could not cure th e defic iencies in Plaintif

f’s prote st. There fore, Pla intiff’s Motion to Amend is denied.
C ONCLUSI ON This Court h

olds that Pla

intiff’s protest w as not val id becau se the pr otest did not contai

n the reasons and justifications for Plaintiff’s objections to Customs’ decision. Thus, this Court lacks jur isdiction t o hear Pla intiff’s claims und

er 19 U.S. C. § 1581(a

). Defe ndant’s M otion to Dismiss for lack of subject matter jurisdiction is granted. Plaintiff’s Motion to Amend is denied.

/s/ Gregory

W. Carman Dated: June 8, 2004 New York, New York