Eteros Says Declaratory Relief Needed to Thwart 'Retaliatory' Action Against Successful CIT Litigant
Importer Eteros Technologies USA last week defended the notion that the Court of International Trade has jurisdiction to hear the company's case alleging that CBP illegally retaliated against the company for its success before the trade court. Eteros said CBP's claimed basis for taking the allegedly retaliatory action against Eteros and its executives, that the company is "aiding and abetting narcotics trafficking," is "factually baseless" and "legally impermissible" in light of the trade court's ruling in Eteros' past case before CIT (Eteros Technologies USA v. United States, CIT # 25-00036).
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Eteros said it's seeking declaratory relief from the trade court "to prevent further retaliation" and preserve CIT's "judicial integrity" by "vindicating the core principle that federal agencies may not evade, punish, or reverse lawful judicial decisions through extrajudicial enforcement mechanisms." The government's attempt to recast the matter as an immigration dispute outside CIT's jurisdiction "mischaracterizes the nature of the relief sought and the legal wrong at issue," the brief said.
Eteros prevailed before the trade court in 2022, with CIT ruling that the company could import "drug paraphernalia" that was legal to obtain at the state level (see 2209210034). Specifically, the court let the company bring in its Mobius cannabis trimming machine, which the federal government deemed to be illegal drug paraphernalia but was legal to import, own and sell in Washington state.
Despite the decision and a CBP HQ ruling affirming the court's treatment of its imports, the importer said CBP officers retaliated against two Canadian Eteros executives by denying them the right to enter the U.S. and, in one executive's case, banning him from entering the country for five years (see 2501300018).
Eteros then filed suit against the retaliatory action under Section 1581(i), which gives the court "residual" jurisdiction regarding the "administration and enforcement" of matters decided under its other jurisdictional grants, including its protest jurisdiction, which Eteros claimed in its initial case. The U.S. moved to dismiss the case, arguing that Eteros' case revolves around two "immigration-related matters," which CIT doesn't have jurisdiction to hear (see 2505050054).
In response, Eteros said the trade court has jurisdiction to hear the case under Section 1581(i) to prevent CBP from undermining the administration and enforcement of the court's prior judgment. The company said if it weren't for CIT's past ruling, "CBP would have continued its unlawful blanket seizure and exclusion of cannabis-related merchandise imported by persons having the legal right to do so." And "but for" the prior decision, CBP wouldn't have retaliated against the company, the brief said.
CBP's actions aren't immigration decisions but rather are a "direct attempt to enforce (or re-impose) import restrictions that this Court has already struck down as unlawful in Eteros I," the brief said. Eteros argued that the U.S. Court of Appeals for the Federal Circuit has "made clear" that when a suit isn't attacking an "underlying trade ruling per se" but an agency's enforcement of that ruling, Section 1581(i) provides jurisdiction, the company said, citing Shinyei Corporation of America v. U.S., in which the court granted Section 1581(i) jurisdiction for a suit challenging the Commerce Department's liquidation instructions in an antidumping review.
Eteros made clear that it's not trying to get the trade court to "adjudicate an immigration matter" but secure "declaratory relief to extinguish the legal theory underlying CBP’s baseless and retaliatory actions." Granting such relief wouldn't "usurp" immigration agencies' authority but would "prohibit the misuse of immigration measures as a tool to undercut this Court’s prior judgment," the brief said.
The company added that any alternative form of relief would "not only be inadequate but nonexistent." CIT would "abdicate its role if it declined to hear this case, as no other tribunal can vindicate its judgment in Eteros I," and Eteros can't be faulted for "failing to seek redress elsewhere," since there's "no other forum that can address CBP’s campaign of retaliation for what it is."
Eteros also argued that exercising jurisdiction here is "institutionally vital for this Court's integrity as an Article III Court," arguing that to permit an agency to "punish and intimidate" a successful party before the court is to chill future actions before the court. "While this case may not fit cleanly within the existing precedent of this Court, dismissal here on jurisdictional grounds would defeat that congressional purpose and reward CBP’s blatant end-run around this Court’s prior judgment in Eteros I," the brief said.