Canadian Exporter Requests CIT Enter Judgment So It Can Pursue Other Issues on Appeal

Canadian exporter Midwest-CBK asked the Court of International Trade to enter judgment against it in a case involving whether sales from a Canadian warehouse to U.S. customers are "sales for export to the U.S." or "domestic sales." Midwest said that over the course of the now six-year-old case, it ceased actively doing business and restructured itself, which has made complying with court orders to produce evidence impossible (Midwest-CBK, LLC v. U.S., CIT Consol. # 17-00154).

In May 2022, the CIT decided that the sales from a Canadian warehouse to U.S. customers are "sales for export to the U.S." rather than "domestic sales" (see 2205200032). The government then asked Midwest to produce evidence that would allow for determination of a dutiable value based on the “FOB Buffalo, New York” prices at which Midwest sold the imported merchandise in the U.S.

In its Sept. 8 status report, Midwest said that such a request is impossible to comply with because it would involve the analysis of tens or hundreds of millions of individual sales. The exporter said that every day it filed a customs entry for a truckload of merchandise arriving at the port of Buffalo and every truck held goods destined for up to 200 different U.S. customers, all of which were aggregated on the entry. Finding the requested prices would require "as many as 10,000 different FOB prices." Even if the company were still active, producing that information would be functionally impossible. "The speediest, inexpensive and just way to reach a final determination" would be for a judgment against Midwest, the company said.

The request was not consent to a stipulated judgment, Midwest said, but rather it was a way to further other issues on appeal.

Midwest asked the court in September 2022 to have two issues appealed to the U.S. Court of Appeals for the Federal Circuit but was denied. The exporter wanted these issues appealed: whether a post-importation sale may serve as the basis of a “sale for exportation to the U.S.” for purposes of the transaction value and whether CBP has any discretion to extend liquidation of entries. Judge Jennifer Choe-Groves denied the request, saying that the issues didn't meet the requirements for an interlocutory appeal because they involved questions of fact, not purely law (see 2209090031).