International Custom Products, Inc. v. United States, 36 I.T.R.D. (BNA) 640

ICP imported a product called “white sauce” and originally obtained a Customs ruling classifying it as a sauce (HTSUS 2103.90.90) with a 6.4% ad valorem duty.
In April 2005 Customs issued a Notice of Action reclassifying 99 entries as a dairy spread (HTSUS 0405.20.3000) with a much higher duty, increasing duties by ~2400% and producing ~ $28 million in assessed liability.
ICP brought multiple lawsuits challenging the reclassification and liquidation; this case is one of several related suits about the same entries.
The Court granted the government’s motion to dismiss: Counts I–VIII dismissed for lack of subject-matter jurisdiction under USCIT Rule 12(b)(1); Count IX dismissed under Rule 12(b)(6). The dismissal was entered in Slip Op 13-120.
ICP moved under USCIT Rule 59(a)(1)(B) for reconsideration (arguing a Fifth Amendment due process violation based on prepayment requirement) and alternatively sought leave to amend its complaint under USCIT Rule 15(a)(2).
The Court denied reconsideration and leave to amend, holding ICP failed to show any of the limited grounds for rehearing, and that amendment would be futile and cause delay.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether prepayment requirement (28 U.S.C. § 2637(a)) violates Fifth Amendment due process	Prepayment of massive, allegedly invalid duties effectively denies access to courts and is unconstitutional	Prepayment is a financial impediment, not a constitutional defect; longstanding precedent upholds prepayment	Denied — court reaffirmed prepayment requirement is constitutional and refused reconsideration
Whether the Court should reconsider Slip Op 13-120	Reconsideration warranted because prepayment produced harsh, unfair, and unconstitutional result	Reasserted prior briefing and rulings; no new evidence or legal error warranting reconsideration	Denied — plaintiff merely reargued issues already decided; no basis for Rule 59 relief
Whether leave to amend complaint should be granted	Amendment would cure jurisdictional/constitutional defects and permit relief	Amendment would be futile and would delay proceedings	Denied — amendment would be futile and cause undue delay
Whether prior appellate decisions affect plaintiff’s ability to obtain relief	Plaintiff points to Federal Circuit ruling voiding the Notice of Action as support for relief on other entries	Government notes plaintiff can pursue relief only after complying with prepayment jurisdictional rule	Court noted the anomalous practical result (plaintiff cannot pay reliquidation amount) but declined to remedy it; legislative change required

Cheatham v. United States, 92 U.S. 85 (recognizing constitutionality of prepayment of duties as a condition to suit)
International Customs Products, Inc. v. United States, 748 F.3d 1182 (Fed. Cir.) (affirming CIT that Notice of Action was void for failure to comply with notice-and-comment and ordering reliquidation)
International Customs Products, Inc. v. United States, 467 F.3d 1324 (Fed. Cir.) (addressing jurisdictional posture of prior ICP challenge)
United States v. UPS Customhouse Brokerage, Inc., 714 F. Supp. 2d 1296 (CIT) (discussing Rule 59 reconsideration practice in the CIT)
Yuba Nat. Res., Inc. v. United States, 904 F.2d 1577 (Fed. Cir.) (noting appellate standard that grant of rehearing is within court’s discretion)