## United States Court of Appeals for the Federal Circuit

04-1464, -1500

YANCHENG BAOLONG BIOCHEMICA L PRODUCTS COMPANY, LTD., Plaintiff-Cross Appellant,

v.

UNITED STATES, Defendant-Appellant, and CRAWFISH PROCESSORS ALLIANCE, LOUISIANA DEPARTMENT OF AGRICULTURE & FORESTRY, and BOB ODOM, Commissioner. Defendants.

J. Kevin Horgan , deKieffer & Horgan, of Washin gton, DC, argued for plaintiffcross appellant. Patricia M. McCarthy , Assistant Director, Commerc ial Litigation Branch, Civil Division, United States D epartment of Justice, of Washington, DC, argued for defendant-appellant. On the brief were Peter D. Keisler , Assistant Attorney General, David M. Cohen , Director, Jeanne E. Davidson , Deputy Director, and Stephen C. Tosini , Trial Attorney. Of counsel on the brief were John D. McInerney , Acting Chief Counsel, Elizabeth C. Seastrum, Senior Counsel, and, Marisa Beth Goldstein , Attorney, Office of the Chief Counsel for Import Administration, United States Departm ent of Commerce, of Washington, DC. Appealed from: United States Court of International Trade Judge Gregory W. Carman

## United States Court of Appeals for the Federal Circuit
04-1464, -1500 YANCHENG BAOLONG BIOCHEMICA L PRODUCTS COMPANY, LTD., Plaintiff-Cross Appellant,

v. UNITED STATES, Defendant-Appellant, and CRAWFISH PROCESSORS ALLIANCE, LOUISIANA DEPARTMENT OF AG RICULTURE & FORESTRY, and BOB ODOM, Commissioner, Defendants.

_________ __________________ DECIDED: May 11, 2005

_________ __________________ Before CLEVENGER, GAJARSA, and PROST, Circuit Judges

. CLEVENGER, Circuit Judge

. The United States appeals the decisio n of the United States Court of International Trade holding it in contempt for violating a preliminary injunction by ordering liquidation of the ent ries of Yancheng Ba olong Biochemical Products Co., Ltd. ("Yancheng"). Yancheng cross-appeals the court' s decision to deny attorney fees for the contempt proceedings. We affirm the decis ion of the Court of International Trade denying Yancheng an award of attorney fees because even though we find that thegovernment was correctly held in contem pt, the government has not waived it s sovereign immunity fo r th is type of award.
I The United States Department of Commerce ("C o mmerce") determined that sales under an antidumping duty administrat ive review reported by Yanc heng were actually from another exporter. C onsequently, Commerce rescinded review of Yancheng' s entries. Freshwater Crawfish Tail Meat from the P eople's Republic of Chin a; Notice of Fina l Results o f Antidum ping Duty Administrative Review and New Shipper Reviews, and Final Partial Rescission of Antidumpi ng Duty Administrative Review, 66 Fed. Reg. 20,634 (Apr. 24, 2001). Yancheng's merchandis e that entered the United States duri ng the period of review ("POR") was thus subjected to a Chinawide duty rate of 201.63 percent. Yancheng then commenced s u it in the Co urt of International Trade and moved for a preliminary injunc tion to stop Commerce fr om liquidating its entries. The injunction was fashioned to prev ent the gov ernment, "dur ing the pendency of this action, includin g during any remands, from causing or permitti ng liquidation" of entries of freshwater crawfish tail meat from China exported by Yancheng and ent ered into the United States during the POR. Yancheng Baolong Bioc hem. Prods. Co. v. United Stat es , No. 01-00338, slip op. at 1 (C t. Int'l Trade Aug. 2, 2001) ("Injunction Order"). The injunction indicated that the entries would be "liquidated in acc o rdance wit h the final court decision as provided in 19 U.S.C. § 1516a(e)." Id. at 2. The Court of International Trade sustai ned Commerce's rescission of the review on August 15, 2002. Yancheng Baolong Biochem. Prods. Co. v. United States ,

04-1464, -1500 2219 F. Supp. 2d 1317 (Ct. Int'l Trade 2002) (" Y ancheng I "). Yancheng appealed that decision to the Federal Circu it on October 4, 2002, and did not seek another injunctio n pending the appeal. Commerce ordered Customs to liquidate Yanc heng's entries at the rate of 201.63 percent on November 1, 2002. On November 5, 2002, Yanc heng filed a motion to clarify the duration of the pr eliminary injunction. The government failed to respond t o this motion to clarify. On N o vember 8, 2002, Customs field offices received the instructions to liquidat e. On January 3 and January 10, 2003, Customs liqu i dated some entries subject to the injunction. The trial court informed the parties on January 15, 2003, that the original injuncti on remained effective th rough the appeal. On January 17, 2003, Customs liquidat ed the last of the 28 entri es on the West Coast. Only three of Yancheng's entries, those on the East Coast, remained unliquidated. See Yancheng Baolong Biochem. Pr ods. Co. v. United States , 277 F. Supp. 2d 1349, 1351- 52 (Ct. Int'l Trade 2003) (" Yancheng II "). On the same day t hat the last liqu i datio n s occurred on the West Coast, C u stoms receiv ed new instructions to discontinue the liquidation of Yancheng's entri es. The Court of International Trade then held the government in contempt of the preliminary injunction on July 16, 2003, based on the liquidations that occurred in J a nuary 2003 that impl emented Commerce's November 2002 instr u ctions. The court found that t he government violated the preliminar y injunction because the injunction was in effect unt il all appeals were completed in the

case. See Yancheng II , 277 F. Supp. 2d at 1363. The Federal Circuit s u stained the applicatio n of the China-wide rate to Yancheng on August 4, 2003. Yancheng Baolong Biochem. Pr ods. Co. v. United Stat es , 337 F.3d

04-1464, -1500 31332 (Fed. Cir. 2003) (" Yancheng III "). In response, t he gov ernment filed a motion t o vacate the civil contempt order . The Court of Internationa l Trade requested additiona l briefing on whether t he government had waived sovereign immunity to the award of contempt damages. The government's moti on to vacate the contempt order was denied on April 28, 2004, and the court held that Yancheng c ould not recover attorney fees as damages for the government's contempt bec ause the government had not waived its sovereign immunity for such an award. Yancheng Baolong Biochem. Prods. Co. v. United States , No. 01-00338 (Ct. Int'l Trade Apr. 28, 2004) (" Yanc heng IV "). Rely ing o n Lane v. Pena , 518 U.S. 187 (1996), the court fou nd that there was no unequivocal
express i on of waiver in any statutory text. Yancheng IV , slip op. at 25. The government now appeals the decis ion of the Court of International Trade whic h he ld the government in contempt of the prelimi nary injunction, and Yanc heng cross-appeals the finding that sovereign immunity precludes its recovery of attorney fees for the contempt proceedings. We hav e jurisdiction over this appeal from a final decisi on of the Court of International Trade pursuant to 28 U.S.C. § 1295(a)(5) (2000).
II This court reviews contempt dec isions for abuse of dis c retion. Ammex, Inc. v. United States , 334 F.3d 1052, 1055 (Fed. Cir. 2002). A buse of discretion will be found when there is an error of law, a clear error of judgment, or findings that were clearly

erroneous. Id. Questions of law are reviewed de novo

. Koyo Seiko Co. v. Unite d States , 36 F.3d 1565, 1570 (Fed. Cir. 1994).

04-1464, -1500 4III The gover nment contends that Yancheng was required to ask for a second injunction f o r the period pen ding appeal and that it s hould not have been he ld in contempt because the prelimi nar y injunction was not a clear order. Yancheng argues that the preliminary in junction in this case is sued such that entries would be " liquidated in accordance with the final court decisio n as provided in 19 U.S.C. § 15 16a(e)," see Injunction Order , slip op. at 2, which under Federal Circuit pr ecedent clearly included the time period pending the appeal. T he go vernment admits that the "[s]uspension of liquidation of subject entries is a routine procedure in this ty pe of cas e because liquidation can render the litigation moot." The govern m ent also acknowledges that this case would have been mooted if Customs w ould hav e liquidated the three East Coas t entries at the same time it liquidated the We st Coast entries. As this court held in Zenith Radio Corp. v. United St ates , if there is no injunction, liquidation is automatic under 19 U.S.C. § 1516a(e) an d § 1516a( c)(1), and any decis ion on the merits of a liquidation challenge after li quidation has t a ken place is without effect. 710 F.2d 806, 810 (Fed. Cir. 1983). To establis h civil contemp t, it must be shown, by cl ear and convincing ev idence, that there was a valid order in place, the defendant had knowle dge of the order, and the order was disobey ed. Ammex, Inc. v. United States , 193 F. Supp. 2d 1325, 1327-28 (Ct. Int'l Trade 2002) . The government argues that it cannot be held in contempt because there is a "fair ground of doubt as to the wrongfulness of the [government's] actions." Preemption Devices, Inc. v. Minn. Mining & Mfg. Co. , 803 F.2d 1170, 1173 (Fed. Cir. 1986). The governm ent asserts t hat the injunction wa s dissolved upon the

04-1464, -1500 5issuance of the Court of Inter national Trade decision, or that at least there was a fair ground of doubt as to whether the injunction continued in to the appeal stage of the litigation. The statutory scheme under wh ic h the preliminary injunc tion issued in this c a se is critical to determining when the injuncti on was inten d e d to disso lve. The p r eliminary injunction references the liqui dation procedure set forth in 19 U.S.C. § 1516a(e). The statutory text of secti on 1516a(e) is as follows: (e) Liquidat ion in accor dance with final decis ion If the cause of action is sustained in whole or in part by a decision of the United Stat es Court of International Tr ade or of the United States Court of Appeals for the Federal Circuit— (1) entries of merchandis e of the character covered by the published determination of the Secretary, the admin istering aut hority, or the Commission, which is entered, or withdrawn from warehouse, for consumption after the date of public at ion in the Federal Register by the Secretary or the adm iniste ring authority of a notic e of the court decision, and (2) entries, the liquidation of wh ich was enjoined under subsection (c)(2) of this section, shall be liquidated in accordanc e with t he final court decision in the action. Such notic e of the court decision s hall be published within ten days from the date of the issuanc e of the court decision. 19 U.S.C. § 1516a(e) (2000). This court has previously determined what constitutes "the final court decision in the action" for the purposes of this statute in Timken Co. v. United States , 893 F.2d 337 (Fed. Cir. 1990). In Timken , the Federal Circuit, while acknowledging that the term "'final decision' can mean differ ent things in different situat ions ," found that 19 U.S.C. § 1516a(e)(2) required that a "final decis i on" is a dec ision that is "conclus i v e ," where all
appea ls or possib ility of appeals are foreclosed. 893 F.2d at 339. The court held that "an appealed CIT decision is not a 'final cour t decision' within the plain meaning of

04-1464, -1500 6§ 1516a(e)." Id. This court further noted that "§ 1516a( e) does not requi re liquidation i n accordanc e with an appeal ed CIT decis ion, since that section require s that liquidation take place in accordance with the fi nal court decision in the action." Id. at 340. The Feder al Circuit has als o addressed this issue in Hosiden Corp. v. Adv a nced Display Manufacturers of America , 85 F.3d 589 (Fed. Cir. 1996). As in Timken , the court found that "[i]n accor dance with 19 U. S.C. § 1516a(e), entri es of merchandis e for which liquidation has been s u spended by c ourt order remain subject to suspensio n o f liquidation until there is a 'final court decis ion in the action.'" Id

. at 590. The court reiterated that "[a] decision of the Court of International Trade that has been appealed 'is not a "final court decision" wit hin the pl ain meaning of § 1516a(e)'" and that "[s]tatute and precedent are c l ear that t he dec ision of the Court of In ternational Trade is not a 'final court decision' when appeal has been taken to the Federal Circuit." Id. at 591. Most recently this court has reviewed "f inal decision" in the context of section 1516a(e) in Fujitsu General America, Inc. v. United States , 283 F.3d 1364 (Fed. Cir

. 2002). In Fujitsu , liquidation was enjoined pursuant to 19 U.S.C. § 1516a(c)(2). Continuing the logic of Timken and Hosiden , the Federal Circuit fo und that the injunction would end, according to section 1516a(e), when the decision was "final" or conclus i ve such that it could no longer be appealed. Id. at 1379. The decision became "final" and the injunction dissolved on the date when "the ti me for petitioning the Supreme Court for certiorari ex pires without the filing of a petiti on." Id. This line of precedent forecloses any argument by the gov ernment that the preliminary injunction was am biguous or was not intended to persist through the appeal process. T here is therefor e no fair ground of doubt that t he government violat ed a valid

04-1464, -1500 7injunction by prematurely liqui dating Yancheng's entries . Thus the Court of International Trade did not abuse its discreti on by holding the governm ent in contempt of the preliminary injunction. Howev e r, Y ancheng cannot recover damages from the government because t he government has not wa ived its sovereign immunity under the theories as presented. Yancheng presented two theories on the waiv er of sovereign im munity in this case. Yancheng argued that the grant of juri sdiction in 28 U.S.C. § 1581(c) to the Court of Internati onal Trade that opened the door to dumping cases in which the Un ited States is a party effectuated a broad waiver of sovereign immuni ty. Yancheng alternatively argued that Rule 86.2 of the Court of Intern ational Trade, which gov erns civil contem pt proceedings in that court and allows for t he award of damages to the party harmed by the contumacious conduct, effects a waiver of sovereign im munity under the Equal Access to Justice Act, Pub. L. N o . 96-481, Ti tle II, 19 80 U.S.C.C.A.N. (94 Stat.) 2325 (1980) ("EAJA") (codified as amended at v a rious se ctions of 5 & 28 U.S.C.). Neither of the theories that Yancheng presents establishes an unequivocal waiver. Waivers of sovereign immunity mu st be "unequivoc ally expres sed." Un ited States v. Nordic Villa g e , Inc. , 503 U.S. 30, 33 (1992) (citing Irwin v. Dep't of Veterans Affairs , 498 U.S. 89, 95 (1990)). The Supreme Court has found that "firmly grounded in [their] precedents" is the fact that "[a] waiver of the F ederal G o vernment's sovereign immunity must be unequiv o cally expressed in st atutory text" and "will not be implied." Lane , 518 U.S. at 192. Y ancheng has not pointed to any language in 28 U.S.C

. § 1581(c) that unequivocally expresses a waiver of sovereign im munity for liability to sanctions for contempt of court, and acco rding to Supreme Court precedent, we cannot

04-1464, -1500 8imply one. Although monetar y damage awards in contempt proceedings may be an effective tool for the Court of International Trade to c ontrol litigant behavior, monetary damages are not the exclus iv e means t o vind icate the authority of the court. The government's submission to the jurisdiction of the court alone is not sufficient to supply a waiver of sovereign immunity for the sancti ons the court sought to impose. Similarly, Yancheng cannot point to a st atutory basis for a waiv er of sovereign immunity with regar d to Rule 86.2 of the Court of International Trade. Yancheng attempts to rely on M.A. Mo rte n son Co . v. United States , 996 F.2d 1177 (Fed. Cir. 1993), to establis h a waiver of sovereign immunity. Mortenson , however, is distinguishable from the present case. In Mortenson , the rule at issue was Rule 37 of the United States Claims C ourt ("RUSCC 37") whic h was drawn in its e n tirety from Federal Rule of Civil Procedur e 37. 99 6 F.2d at 1183. T he Federal Rules are promulgated under the authority of the Supreme Court and ar e submitted to Congress for review and approval whic h, according to the Suprem e Court, deems the Federa l Rules as having the " f orce [and e ffect] of a federal statute." Sibbach v. Wilson & Co. , 312 U.S. 1, 13 (1941); see also Mortenso n , 996 F.2d at 1181. In the present case, attorney fees were requested based on Rule 86.2 of the Rules of the United States Court of International Trade which provides that "[a] reasonable counsel fee, necessitated by the contem pt proceeding, may be included as an item of damage." Unlike RUSCC 37, Rule 86.2 of the Court of International Trade has no corollary rule in the Feder al Rules, and the Rules of the Court of In ternational Trade are not promulgated subject to congress i onal approval. The c ourt is giv e n blanket authority by statute to promulgate its own ru les, but without any s p ecific power to subject the Un ited

04-1464, -1500 9States to monetary liability. See 28 U.S.C. § 2633(b) (2000). Thus, the logic of Mortenson simply does not extend to the ru le at issue in this case. Yancheng did not file an EAJ A petition. We ther ef ore need not reach the question of whether Yancheng is a prevai ling party in the contempt proceedings because at torney fees are not sought under an EA JA petition. Because neither of Yancheng' s proffered theories support find ing an unequiv o cal waiv er expressed in statutory text, attorney fees awarded as damages incurred because of the contempt proceedings against Commerce cannot be granted in this case.
IV The Court of Internati onal Trade correctly held the United States in contemp t of the preliminary injunction restraining the liqu idation of Yancheng' s entries at the Chinawide rate. However, we conclude that t he government has not waived its sovereign immunity to the award of attorney fees under Rule 86.2 of the C ourt of Internationa l Trade; thus we affirm the denial of such an award.

AFFIRMED

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