CIT Orders Government to Respond to Certain Requests for Admission in Customs Fraud Case

The Court of International Trade ruled in an Oct. 18 opinion that the U.S. must respond to 25 of importer Greenlight Organic's requests for admissions in a customs fraud case. Having filed 116 of them, Greenlight, along with exporter Parambir Singh Aulakh, then moved to compel the U.S. to respond, hoping that they would narrow the scope of the fraud case and expedite the process. The court agreed with the U.S.'s objections to many of the RFAs, but ultimately granted the move to compel the U.S. to answer the remaining 25.

The government initially brought the case over Greenlight's entries of Vietnam-origin knit garments, claiming that the importer committed fraud in misclassifying the goods as woven garments and undervaluing the goods. Greenlight sought to use the discovery process to "get information that it was entitled to by law and to narrow the issue," it said in its motion to compel (see 2107260038). The subjects of the discovery included instructive manuals that guide government conduct in a Section 1592 investigation, a detailed privilege log, properly redacted documents listed within such a privilege log and a complete response to Greenlight's production requests.

Many of the U.S.'s objections to responding to the RFAs, and the RFAs themselves, center around two exhibits in the case. The first exhibit is a spreadsheet that the U.S. says identifies the date of entry, price and factual circumstances of the 148 entries in dispute. The second exhibit is another spreadsheet that identifies entries for which Aulakh and Greenlight created two sets of invoices, the U.S. said.

In the fraud investigation, the U.S. said that Greenlight conspired with a foreign vendor, called One Step Ahead, to submit the false statements to CBP. For a number of Greenlight's RFAs, the U.S. objected to having to respond to them, arguing that it can't trust any of the information submitted by Greenlight and that there are no corroborating documents that would allow it to appropriately answer the RFAs.

"Because Plaintiff asserts an inability to answer due to lack of corroborating documentation, Plaintiff’s objections are akin to 'assert[ions] [of] lack of knowledge or information as a reason for failing to admit or deny . . . and that the information it knows or can readily obtain is insufficient to enable it to admit or deny' under USCIT Rule 36(a)(4)," the opinion said. "The Court concludes that Plaintiff’s objections to requests 1–3, 8–9, 14–15, 19–20, 24–25, and 29–30 are justified or are sufficient answers based on lack of knowledge or information." This defense was also upheld by the court for multiple other RFA objections.

The U.S. also refused to answer a number of other RFAs from the defendants relating to the date the fraud occurred. The defendants argue that the five-year statue of limitations had run out before the U.S. filed its complaint. The court identified these RFAs as attempting to contract an opposing party into conceding an essential fact or issue, which is not what they are intended to do. Seeing as RFAs are meant to "identify undisputed facts or issues," the U.S.'s objections to them are justified, CIT said.

(United States v. Greenlight Organic, Inc., et al., Slip Op. 21-145, CIT #17-00031, date 10/18/21, Judge Jennifer Choe-Groves. Attorneys: William Kanellis for plaintiff U.S. government; Robert Silverman of Grunfeld Desiderio for defendants Greenlight and Aulakh)