In a brief 54 page opinion Judge Carmen doles out the what is hopefully the end of the on going saga which could be titled "UPS, Tricky Cathode Ray Classification and the Revenge of the Ten Factors."
For those who indulge in dry reading the novel chapters are as follows:
Chapter I The Saga Begins: The Disputed Amount Will be a Mere Pittance.
Chapter II Plead to a Higher Power For Guidance on Hard Questions
Chapter III Hard Questions Are Best Left Unanswered
Chapter IV Cathode Ray Tubes Might be Everywhere: Let the Trial Begin.
Chapter V The Verdict is in Guilty: But the Hope Lives On.
Chapter VI The Tale of Ten Factors: Hard Questions Remain Unanswered.
Chapter VII The Fatal Gang of Ten Factors Let the Prisoner Go Free.
Will there be another Chapter? I certainly hope not.
I can't believe the end of this case. After Customs wins the ability to penalize a broker with a $75,000 fine, UPS appealed that decision, but also argued that that customs did not consider ALL of the ten factors listed in 19 CFR 111.1. when issuing the penalty.
Many, myself anyways, thought this would just then be sent back to the agency to reconsider all ten factors. (My blog from August 11th. Lawrence Friedman's Blog From August 13th.) Then after considering all ten factors it would go back to court with the same conclusion. So that finally the question of whether the maximum penalty issued to a broker can exceed $30,000.00 would be answered. I suppose we will never know that answer.
But now the Court concludes that if Customs failed to look at all ten factors at the time the penalty was issued then the penalty ab initio was faulty. The Court didn't say exactly that but the Court ruled the "failure was tantamount to a failure ... to meet its burden of proof." US CIT Slip-OP 10-11 at 53. This indicates that Customs must present at trial that it considered all ten factors before it can perfect a broker penalty.
UPS is off the penalty Scott free. My jaw dropped I was so stunned. I guess I need a life.
Why it took Judge Carmen 54 pages to come to the conclusion is another story. I suppose he likes to be thorough.
Must congratulate the lawyers arguing for UPS. Picking up on the ten factors listed in 19 CFR 111.1 was a thorough job and a creative argument. Broker penalties will have to change. They are few and far between in the first place.
Will UPS try to claw back the penalties it already paid... Maybe the Saga is not over yet.