US Says CIT Customs Suit Lacks Jurisdiction Since Admissibility Hinges on DEA Action

UniChem entered the single entry of 7-Keto DHEA, a Schedule III nonnarcotic controlled substance, at Newark Liberty International Airport in November, where it was detained by CBP because the company failed to submit a DEA Form 236, which allows for the import of Schedule III controlled substances. CBP issued a total of four detention notices for the goods since DEA "was actively investigating the subject merchandise" and had yet to find it was admissible.

The importer took to the trade court, filing the suit under Section 1581(a), which provides the trade court with jurisdiction to hear "any civil action commenced to contest the denial of a protest." UniChem said that the court can hear the case since the goods were deemed excluded by operation of law. In response, the U.S. said the goods have "not been excluded by operation of law" because CBP continues to detain the entry "pending an admissibility decision by DEA over which the Court lacks jurisdiction."

The government noted that DEA is responsible for administering the Controlled Substances Act, which includes regulating the import of controlled substances. The act bars the import of any nonnarcotic Schedule III controlled substances unless imported under a permit, notification or declaration that the DEA may prescribe.

The ultimate admissibility decision is "vested with DEA and not with CBP," meaning the goods have not been excluded by operation of law, the brief said. The question of whether Congress gave an agency other than CBP the power to make the given admissibility decision "hinges on whether another agency has taken responsibility for determining the legality of the merchandise, even if that agency does not necessarily have separate authority to detain or exclude the merchandise," the U.S. said.

As a result, 19 U.S.C. 1499(c), under which goods are deemed excluded by law, does not apply when another agency "is responsible for deciding the legality of an importation," the government argued. A purpose of this law is to give importers an avenue to protest CBP's exclusion decisions. "But when CBP’s decision is based on a determination by another agency, there is no protest remedy that CBP can provide because the importers’ dispute is with the other agency’s determination, not CBP’s decision," the brief said. As a result, there's no 1581(a) remedy.

The government cited the trade court's 2018 ruling in Andritz Sundwig GMBH v. U.S., where the court said that "a protest challenging actions taken by CBP on behalf of another agency and pursuant to that agency’s regulations and laws was invalid and did not give rise to jurisdiction under 28 U.S.C. § 1518(a)." In that case, CBP issued notifications to the importer under the Plant Protection Act, telling the company to reexport or destroy pest infested cargo.

The court denied jurisdiction under 1581(a) because the case potentially involved "the exclusion of merchandise from entry" but found that it was not a decision CBP made "under any provision of the customs laws." The court "inherently recognized that when CBP’s actions or decisions are taken or made on behalf of, or at the behest of, other agencies and reflect those agencies’ efforts to enforce non-customs laws and regulations for which they have or share responsibility, the Court lacks jurisdiction to review the ministerial actions of CBP," the brief said.