[00:00:00] Speaker 02:
The next case is ARP Materials versus US, number 212176.

[00:00:04] Speaker 02:
Good morning.

[00:00:05] Speaker 03:
It would please the floor for Evan Kane and the board firm Simon Buckley-Kane.

[00:00:12] Speaker 03:
We represent ARP Materials and Harrison Steel Castings in this consolidated appeal.

[00:00:18] Speaker 03:
If there ever was a prototypical case for jurisdiction on the 1581i, this consolidated case is it.

[00:00:25] Speaker 03:
The subject matter was and is the administration of tariffs for each

[00:00:29] Speaker 03:
with taxes on the importation of merchandise for reasons other than raising revenues, as it involves retaliatory duties assessed against Chinese IPR practices on the Trade Act of 1974, Section 301.

[00:00:46] Speaker 03:
The subject matter is more specifically the ministerial administration of the decisions of the USTR by customs relative to China's 301 deep green funds that the USTR had ordered

[00:00:58] Speaker 03:
were mitigating harm to U.S.

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and industries as a result of the assessment of the three of them.

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Before reaching the inescapable conclusion that the 1881-I jurisdiction applies, both of the other sub-par 1881-A through 1881 must be bound to be manifestly inadequate.

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In this case, the CIT set up on 1581-A under the goal to simply apply adage

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If you can file a protest with customs, you have a D-8-1 jurisdiction in the CIT if customs denies a protest.

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Well, liquidation is a precondition to any protest, and any liquidation can be protested.

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But that doesn't automatically mean we're valid in protest.

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There are numerous cases that have been cited in our briefs, which have found that customs act mysterially, and a many mysterially performed act by customs is not protestable.

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even if it made one of the seven decisions that enlisted him with a protest statute, which includes liquidation.

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The government has had some difficulties with us signing this case.

[00:02:10] Speaker 02:
Mr. Kane, what do you want in this case?

[00:02:13] Speaker 03:
We want the case to be remanded to the Court of International Trade because the Court of International Trade.

[00:02:20] Speaker 02:
What do you want the court to do if this were an I case?

[00:02:23] Speaker 02:
Do you want the court to order

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that the liquidation be reliquidated to give you a refund?

[00:02:32] Speaker 03:
Well, under U.S.

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Code 2634, I think the Court of International Trade has equitable authority to grant 20 judges.

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We decided to come to actual entries to demonstrate our injury in standing in the Court of International Trade.

[00:02:51] Speaker 03:
But this is really not an entry-specific

[00:02:55] Speaker 02:
Well, that's what I don't understand, Mr. Kane, because if you were asking for some kind of broad declaration or something and not anything further, I might see how you could get under eye, but at the end of the day, you want the liquidation decision redone in a refund, right?

[00:03:16] Speaker 03:
Well, that would be the ideal outcome in the final analysis.

[00:03:23] Speaker 03:
Since they're at least lying on the case that it's suspendable in this case, the Court of International Trade either has to be directed by your court or on its own to tell customs that it can't run a protest.

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That's three parts of Section 301 to be three parts for defying the U.S.

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law.

[00:03:48] Speaker 02:
But Customs has liquidated the duties that they collected for 301.

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And the only way, and that's a final decision, unless it's challenged.

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We don't have any authority, do we, to overturn that final decision.

[00:04:02] Speaker 03:
Well, if we look to the decisions of this court in Cheyenne, corporate America, in 2004, 2008, 2010,

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The conflict between the two jurisdictional bases, 1581A and 1581I, was resolved by this court twice in favor of 1581I after the Court of International Trade had dismissed on finding that it was 1581A.

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What was involved was an instruction from the Department of Commerce to customs to liquidate some entries after an administrative review had been conducted

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And the calculations that were determined in the administration were incorrect.

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It estimated two customs, and customs liquidated the insurance.

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The court held that the jurisdiction lay under 1581 I. Ultimately, the case was settled.

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And in its 2010 decision, the Court of International Trade was, the case was remitted again to the Court of International Trade to find the amount of equal access

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that the plaintiff was entitled to because of the customs and government recalcitrance, insisting over and over again that 1581A was the bottom line of jurisdiction.

[00:05:26] Speaker 02:
But my problem is, in this case, the ultimate remedy you want is your money back.

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And you can get your money back if you protest the decision.

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So how is A not available in the right remedy, and certainly not manifestly inadequate?

[00:05:44] Speaker 03:
It's not a protestable decision, because it's not a decision by customers.

[00:05:49] Speaker 02:
That's just plain wrong that it's not a protestable decision, because there have been protests of these decisions, and you've gotten refunds of these.

[00:05:58] Speaker 02:
It's just some of them, you've missed the time deadline.

[00:06:01] Speaker 03:
Your Honor, Your Honor, if the government

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And money could not have been recorded on the basis of farmland protest.

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And the protest could be violent timing.

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We saw no objections to doing that.

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As Napoleon or Caesar or one famous general after another said, when your area is making an error, you don't correct it in the middle of it.

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It wouldn't serve any purpose for us to argue with the government saying that they shouldn't be requiring a 1584 to 8 protest

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a 1915-14 protest, if they wanted to give us the money back.

[00:06:40] Speaker 03:
Mr. Cain, excuse me.

[00:06:41] Speaker 03:
This is gentlemen.

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I'm having the same problem that Judge Hughes is having, because ultimately, what you're after is a determination by customs that these goods should be reliquidated.

[00:06:57] Speaker 04:
And they are liquidated, and there is evidence

[00:07:02] Speaker ?:
Our law is very clear that once the goods are liquidated, that's a final determination that can only be changed if customs reliquidates.

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And so it seems to me that you clearly have the opportunity to do that through a protest.

[00:07:24] Speaker 03:
May I respond to that, Your Honor?

[00:07:26] Speaker 03:
Yes, please.

[00:07:27] Speaker 03:
1581A requires the final valid protest.

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A valid protest requires the decision by customs, timeliness, and specificity in distinct information.

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The decision of the Supreme Court in Davies versus Arthur, when Chester Ray Arthur was the collector in 1877, held that unless the protest sets forth distinctly and specifically

[00:07:59] Speaker 03:
around in which the objections to the amount plain, it fails to require the protest action.

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The purpose of the protest action is to point out to the officers and customers the precise errors of fact or law which rendered the exact of duty unauthorized.

[00:08:14] Speaker 03:
That case was cited by the New York court in 1999 in court, the average versus US, where it was held that if the protestor didn't provide

[00:08:26] Speaker 03:
classification that it wanted the, wanted customers to substitute against the original classification that was used at entry, I'm sorry, at liquidation, it was an inbound protest.

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And our client, most specifically in this case, with Harrison, Harrison had entries of base metal fittings that were not as smoothed

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until more than 180 days after liquidation of the entrance.

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So there was no ability to file a protest with the information about the classification that we wanted them to use at customs.

[00:09:08] Speaker ?:
And no one that was used at entry.

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And when the exclusion is granted, there's a Federal Register notice.

[00:09:14] Speaker 03:
And along with the Federal Register notice, there is a designation of the new

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chapter 99 classification was indicating that the merchandise has qualified for an exception and exclusion.

[00:09:26] Speaker 03:
And there was no way we could have done that.

[00:09:29] Speaker 03:
It's just a fact that if you file a protest, doesn't it have a valid protest?

[00:09:33] Speaker 03:
It would have been the whole of the protest.

[00:09:35] Speaker 03:
And for $53,000.

[00:09:37] Speaker 02:
Mr. Kane, was your client seeking an exclusion at the time of the liquidation decision?

[00:09:46] Speaker 03:
Was our client?

[00:09:47] Speaker 03:
Yes.

[00:09:49] Speaker 03:
They initially went on.

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There were 53,000 institution requests.

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87% of the institution requests were denied.

[00:10:00] Speaker 03:
If we follow the guidance of the Court of International Trade.

[00:10:04] Speaker 03:
Well, if you weren't seeking, if you weren't.

[00:10:07] Speaker 03:
If you weren't.

[00:10:08] Speaker 02:
Mr. Cain, Mr. Cain, please.

[00:10:11] Speaker 02:
Please wait for the questions.

[00:10:13] Speaker 02:
I know there's some lag, but you're talking over me.

[00:10:15] Speaker 02:
If you weren't seeking an exclusion at the time the entry was done and it was liquidated, then it was correct at the time.

[00:10:27] Speaker 02:
You're trying to get the effect of an exclusion request filed by a different entity after the fact.

[00:10:36] Speaker 02:
But I mean, there's guidance in all of this 301 implementation program that would have allowed you, if you had a basis to seek an exclusion for this entry, even if it hadn't been granted, to protest it and allow customs to suspend that.

[00:10:53] Speaker 02:
Isn't that correct?

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The exclusions under 301 were product specific.

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And more than product specific, they were not just HDS number.

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They were specific description of the merchandise.

[00:11:05] Speaker 02:
We have a client that made 19 exclusion requests under a single HDS plan.

[00:11:12] Speaker 02:
I don't know why that matters.

[00:11:13] Speaker 02:
If your client wasn't specifically seeking the exclusion and asked to suspend the, they could have, if they were, they could have asked us to suspend the liquidation.

[00:11:23] Speaker 02:
If not, you're trying to get the effect of something you weren't even challenging at the time.

[00:11:27] Speaker 03:
But everyone's fine with it.

[00:11:29] Speaker 03:
That was a big student government task.

[00:11:31] Speaker 03:
Tell the people that they can file a protest.

[00:11:36] Speaker 01:
But counsel, aren't they entitled to it under a particular procedure?

[00:11:40] Speaker 01:
It's a particular procedure that has to be followed in order to be entitled to it if you yourself are not going to seek the exclusion in front of the USTR, right?

[00:11:51] Speaker 03:
Correct.

[00:11:51] Speaker 03:
Correct.

[00:11:52] Speaker 03:
Well, the procedure that was put in place was the protest procedure, which was a swim pen for around home.

[00:12:00] Speaker 03:
You know, the government claims that the only way that they could have issued refunds under the refunded regime of the USTR was through protest meetings.

[00:12:10] Speaker 03:
And that's not true.

[00:12:12] Speaker 03:
There's ample authority for customs and other agencies to promulgate regulations that would have allowed the public the opportunity to point out the problem that we have in this very case, where if the USTR took more than 494 days to render a decision,

[00:12:30] Speaker ?:
on an exclusion.

[00:12:31] Speaker 03:
People who made the entry on the first day that the exclusion was, I'm sorry, on the first day that that particular list was in fact, they'd be unable to get a refund under the protest because they wouldn't have the information they needed to file a protest and had no way of knowing that the US DO would actually issue an exclusion on that version.

[00:12:53] Speaker 01:
I have one more question for you, which is I noticed that in your brief, you have some sort of APA challenge.

[00:13:01] Speaker 01:
But when I looked at your briefs below, I didn't see that clearly spelled out.

[00:13:06] Speaker 01:
Did you argue that below?

[00:13:07] Speaker 03:
I don't think we did that on detail below.

[00:13:12] Speaker 02:
All right.

[00:13:14] Speaker 02:
Mr. Kane, you're well into your mental time.

[00:13:16] Speaker 02:
Why don't you save the rest of it, and we'll hear from the government.

[00:13:43] Speaker 00:
May it please the court.

[00:13:44] Speaker 00:
The trial court's decision should be affirmed, as it correctly determined that it did not have jurisdiction pursuant to section 1581i, because it would have had jurisdiction pursuant to section 1581a if appellants had timely protested CBP's liquidations.

[00:14:00] Speaker 02:
As the trial court succinctly put it, appellants- Let me just interrupt you and get to the last point Mr. Kane raised, or at least what I heard him to be raising, which is,

[00:14:09] Speaker 02:
that he's challenging, and maybe he didn't preserve it, but he's challenging not just the exclusion and the refund in this particular case, but the entire way this program was implemented by USTR and customs that didn't set up a separate refund process and forced it to go through the protest system.

[00:14:32] Speaker 02:
If that was his argument,

[00:14:35] Speaker 02:
Could he bring that in a different way than through a protest if it's kind of a facial challenge the way the program was set up?

[00:14:43] Speaker 00:
Well, I'll try and take your honor's answer in two parts.

[00:14:47] Speaker 00:
Specifically with regard to what appellants did, I think your honor has noted that they sort of vaguely alluded to APA in their brief below and then again here.

[00:14:59] Speaker 00:
But they didn't really raise an APA claim.

[00:15:01] Speaker 00:
And the trial court correctly determined not to address them because it didn't have jurisdiction.

[00:15:08] Speaker 00:
squarely raised an APA claim.

[00:15:10] Speaker 00:
I think I'm reading your honor's question to refer to maybe that USTR and CBP had the authority to set up this framework in the first place.

[00:15:19] Speaker 00:
Then I think that they run into a few problems.

[00:15:22] Speaker 00:
I think the only way that they could potentially have brought one is

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through Section 1581i.

[00:15:29] Speaker 00:
But if they were going to do so, they should have done so within two years of USTR and CBP first coming up with this framework.

[00:15:36] Speaker 00:
With the program, right?

[00:15:37] Speaker 00:
With the program.

[00:15:38] Speaker 00:
So years ago.

[00:15:38] Speaker 00:
And they haven't done so.

[00:15:40] Speaker 00:
And now they're outside of the statute of limitations to do so.

[00:15:44] Speaker 02:
If they thought that forcing this through, forcing is not the right word.

[00:15:48] Speaker 02:
requiring them to use the traditional protest of the liquidation if they thought that that just didn't make sense, wasn't consistent with 301 and the proclamation under 301.

[00:16:01] Speaker 02:
And USTR should just have set up a refund system administered by whoever for them to file, send in a notice saying, I want a refund because you excluded that.

[00:16:13] Speaker 02:
Do you think USTR could have done that?

[00:16:15] Speaker 00:
I do not.

[00:16:18] Speaker 00:
So I think that they

[00:16:21] Speaker 00:
would have had to raise the claim in the way that I just mentioned.

[00:16:23] Speaker 00:
But I don't think that there would be any merit to that claim in the first place.

[00:16:28] Speaker 00:
And why is that?

[00:16:29] Speaker 00:
Well, we specifically noted that not only did CBP have the authority to do so, but they were supposed to do so.

[00:16:36] Speaker 00:
Because Section 1500 and Section 1514 taken together mean that CBP is the master of liquidations and classifications.

[00:16:46] Speaker 00:
And the way that USTR implemented the 301 decisions in the first place was through the insertion of an HTS subheading that specifically categorized entries as subject to the 301 tariffs.

[00:16:58] Speaker 00:
So the only way they could then exclude them was through the insertion of another subheading, and that would be effectuated and classified by CBP through liquidation.

[00:17:09] Speaker 00:
Moreover, I think appellants raised in their, I can't remember if it was their opening brief or reply brief in front of this court, ways that they theorized that USTR and CBP could have instituted these refunds.

[00:17:23] Speaker 00:
However, I don't think that any of them are necessarily statutorily authorized, and I don't believe they raised these

[00:17:30] Speaker 00:
potential alternate methods before the trial court.

[00:17:34] Speaker 00:
So it's not for this court to consider those in the first instance.

[00:17:37] Speaker 02:
What about their, I think, equity point that some of these people didn't seek exclusions, but under exclusions granted, they would have been entitled to the same thing.

[00:17:49] Speaker 02:
But it just happened too late in the game for them to take advantage under Ed.

[00:17:54] Speaker 02:
What should they have done?

[00:17:58] Speaker 02:
want to seek their own exclusion.

[00:18:00] Speaker 02:
Is it just that's on them or is there other steps they could have taken to kept their liquidation open even if they weren't seeking an exclusion?

[00:18:13] Speaker 02:
Because I do think Mr. Kane has a point is that you can't just protest if you don't have some disagreement with it.

[00:18:19] Speaker 02:
And if you're not seeking exclusion, what would your protest be?

[00:18:23] Speaker 00:
So like usual, a couple different answers to that.

[00:18:27] Speaker 00:
I think your honor's question seems to go to the question of whether the remedy was manifestly inadequate under section 1581i.

[00:18:35] Speaker 00:
And as this court has held, that's a high bar.

[00:18:38] Speaker 00:
It has to basically mean that the protest is useless or incapable of producing any result.

[00:18:44] Speaker 00:
We completely agree that

[00:18:46] Speaker 00:
The exclusions are product specific, and so other importers or other companies could take advantage of an exclusion that they did not themselves request, so long as they proved to CBP that their products met that exclusion and filed a timely protest.

[00:19:04] Speaker 00:
Mr. Kane states that the appellants in this case did not have the chance to do so.

[00:19:09] Speaker 00:
I think that in this case, ARP and Harrison are actually in completely different boats.

[00:19:13] Speaker 00:
ARP certainly had every chance to file a timely protest because the exclusion requests were granted.

[00:19:21] Speaker 00:
Either before ARP's entries even liquidated, or in one case only five days into that 180-day period.

[00:19:27] Speaker 00:
So they have no excuse whatsoever.

[00:19:30] Speaker 00:
With regard to Harrison, I think Your Honor asked what could Harrison have done.

[00:19:33] Speaker 00:
And CBP actually made the process very clear for those

[00:19:38] Speaker 00:
importers on May 22nd of 2019 which was before the exclusion request relevant to Harrison was filed and you know months before Harrison's entries liquidated CBP issued guidance in a CSMS message that basically stated that

[00:19:57] Speaker 00:
importers should file, I don't remember if they used this term exactly, but we used and the trial court used the term protective protest on things where they knew that there was an exclusion request pending, but the entries might be liquidated before the request was granted.

[00:20:13] Speaker 00:
And then CBP would basically hold the decision on a protest until the exclusion was granted.

[00:20:19] Speaker 00:
So CBP foresaw that this might be an issue and specifically

[00:20:24] Speaker 00:
carved out a way for protesters to preserve and file a timely protest while waiting for the exclusion decision.

[00:20:31] Speaker 00:
And I think even as appellants council pointed out, there was also the opportunity for

[00:20:38] Speaker 00:
importers to request an extension of the liquidation.

[00:20:41] Speaker 00:
So they actually had a couple different options as to how they could have kept the right to timely protest.

[00:20:46] Speaker 00:
And again, as the trial court said, they regrettably dropped the ball and simply did not do so.

[00:20:51] Speaker 00:
This does not entitle them to jurisdiction under 1581i, as it does not render 1581a inadequate.

[00:20:59] Speaker 00:
And the only last thing I'd like to say, unless this court has questions, is that we pointed out, and the trial court astutely pointed out, that USTR's decision on exclusions was not self-executing.

[00:21:12] Speaker 00:
It necessarily involved CBP in its traditional role as the liquidator.

[00:21:17] Speaker 00:
And this court has held time and again in Xerox, CEMEX, Belgium, Hutchinson, Juice, and so on.

[00:21:23] Speaker 00:
that liquidations are subject to the timely protest requirement.

[00:21:28] Speaker 00:
And that's what we have going on here.

[00:21:30] Speaker 00:
I'm happy to answer any other questions.

[00:21:32] Speaker 00:
Otherwise, we respectfully request that the court affirm.

[00:21:35] Speaker 00:
Thank you.

[00:21:37] Speaker 02:
Thank you.

[00:21:47] Speaker 02:
Mr. Kane, you have a couple minutes left.

[00:21:52] Speaker 02:
Sorry, can you stop?

[00:21:53] Speaker 02:
We can't hear you.

[00:21:58] Speaker 02:
Sorry.

[00:21:59] Speaker 02:
OK.

[00:21:59] Speaker 03:
Can you hear me now?

[00:22:01] Speaker 02:
Yes.

[00:22:02] Speaker 03:
I just said, I just made the winning argument, and you missed it.

[00:22:06] Speaker ?:
I have several points that I'd like to make here.

[00:22:09] Speaker 03:
The reason, I'm sorry.

[00:22:11] Speaker 03:
What the CSMS was a custom service messenger, a message system.

[00:22:17] Speaker 03:
It was an electronic message that was available on the internet.

[00:22:21] Speaker 03:
And it didn't say that importers should protest.

[00:22:24] Speaker 03:
It said they may protest.

[00:22:25] Speaker 03:
It didn't say that failure to file a protest was going to be damning in any way.

[00:22:30] Speaker 03:
It just said they made protest.

[00:22:32] Speaker 03:
At the time, Customs and USDR were finding their way through this process.

[00:22:39] Speaker 03:
The 2021 GAO report entitled USDR should fully document internal procedures for making tariff exclusion and extension decisions

[00:22:51] Speaker 03:
points out a whole 80 pages of shoddiness that the USTR had that they didn't realize what they were dealing with and how it should be dealt with.

[00:23:01] Speaker 03:
As far as a program being contested by us, we would not have been standing until we had been denied a refund.

[00:23:13] Speaker 03:
The refund system, as you may recall, with the home maintenance tax,

[00:23:20] Speaker 03:
cobbled together by the Department of Justice and Customs outside of any kind of statutory, well, any statutory restrictions that was made to effectuate our refund system.

[00:23:34] Speaker 03:
There's no reason, if Customs was supposed to effectuate the decisions of the USTR, there's no reason why Customs would freeze out entries that were the subject of 301 duties that would

[00:23:48] Speaker 03:
not be able to be refunded because the protest actually acted as a ball.

[00:23:55] Speaker 03:
The USDR was intended by making the exclusions an opportunity to make right the burden that had reasonably been placed on importers of certain products that would have affected US companies and US workers.

[00:24:14] Speaker 03:
using the protest statute to say you have 180 days after liquidation to get your refund that ignored at least 17 rounds of refunds that could have been gotten under exclusions that were made by the U.S.

[00:24:30] Speaker 03:
after 494 days of the initial date of the implementation of that list.

[00:24:36] Speaker 03:
I use that date because customs

[00:24:39] Speaker 03:
314 days liquidation cycle plus 108, that's 194.

[00:24:43] Speaker 03:
Anything beyond that would be foreclosed from getting a refund.

[00:24:51] Speaker 02:
OK.

[00:24:51] Speaker 02:
Thank you, Mr. Cain.

[00:24:52] Speaker 02:
Your time has expired.

[00:24:54] Speaker 02:
We have your arguments, I think.

[00:24:56] Speaker 02:
Thank both counsel for their arguments.

[00:24:59] Speaker 02:
The case is submitted.