No Right to Trial by Jury for Decisions on Customs Penalty Amounts, CIT Says

The right to a trial by jury does not apply to the determination of penalty amounts for customs violations, the Court of International Trade said in a decision issued March 26. While the jury can decide whether an importer is liable for penalties under 19 USC 1592, the determination of how large a penalty a guilty importer must pay is up to the judge, CIT said.

The ruling comes days before a jury trial -- CIT’s first in about 20 years -- is set to begin April 1 to decide the fate of Univar (see 1903120029), an importer accused of evading antidumping and countervailing duties on saccharin from China that was allegedly transshipped through Taiwan (see 1811210026). The government seeks $47.9 million in penalties and $36.1 million in unpaid duties for grossly negligent violations of 19 USC 1592.

While the jury is already set to determine whether Univar is liable for penalties, the government wanted the jury to decide the penalty amount should it find Univar liable. Univar opposed the request.

First, the trade court looked to whether the Section 1592 penalty statute itself grants a right to jury trial. It found that the law does not. Prior to 1978, Section 1592 set a fixed penalty regardless of whether the violation was negligent, grossly negligent or fraudulent, and did not provide for review by a judge. In 1978, Congress amended the law to create the current scheme with penalties varying based on levels of culpability, and provided that the penalty amount is subject to “de novo” review.

But the statute itself and the congressional record only refer to review by a court, and not whether that review should be conducted by a judge or a jury. “Thus, the court is unable to discern any congressional intent to grant a statutory right to a jury trial on the determination of the amount of civil penalties,” CIT said.

CIT also considered whether the right to trial by jury granted by the Seventh Amendment to the Constitution applies to penalty amounts in customs cases. In 1987, the Supreme Court ruled that a defendant had a right to trial by jury to determine whether it was liable for penalties under the Clean Water Act, but not as to the amount of those penalties. The government usually just seeks the maximum amount prescribed by law, the high court reasoned.

That same logic applies to Section 1592, CIT said. “Congress’s ability to delegate the civil penalty determination to trial judges at the Court of International Trade is not in question,” it said. “Congress has done so here because, while it chose to set statutory maximums, it clearly intended for the court ‘to make its own judgment about the appropriate remedy for a section [1]592 violation.’” The determination of penalty amount under Section 1592 is not “‘an essential function of a jury trial,’ and the Seventh Amendment does not provide a right to have a jury determine civil penalties pursuant to section 1592(c),” CIT said.