International Fidelity Insurance v. Sweet Little Mexico Corp.
2011 U.S. App. LEXIS 25837
| 5th Cir. | 2011Background
- IFIC paid duties to Customs on SLM's seventy peanut-entry imports after SLM failed to prove Mexican origin; SLM disputed NAFTA treatment.
- IFIC, as surety, sought indemnification in district court for $1,602,434.16 actually paid to Customs on SLM's behalf, plus related fees.
- Customs later demanded additional amounts tied to twenty-seven other entries; IFIC settled portions of those claims, with further payments by IFIC.
- Proceedings in the CIT contested Customs' denial of NAFTA treatment for the seventy entries; IFIC petitioned in district court for indemnity and reimbursement.
- Customs moved to dismiss the district action for lack of jurisdiction; the district court allowed IFIC's claims to proceed against SLM.
- The CIT consolidated IFIC's action with the United States' penalty action against SLM; SLM appeals the district court's summary judgment against it.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the CIT has exclusive jurisdiction over IFIC's district-court claims | IFIC contends district court claims fall outside CIT exclusive jurisdiction | SLM argues §1581/1583 give CIT exclusive jurisdiction over all IFIC claims against SLM | District court has jurisdiction; CIT exclusive jurisdiction not all-encompassing |
| Whether first-to-file bars concurrent actions | IFIC contends no bar to district court proceeding despite CIT filing first | SLM asserts first-to-file should dismiss/transfer | District court did not abuse discretion; substantial overlap not sufficient to dismiss |
| Whether SLM must indemnify IFIC for duties paid under the bonds | SLM is obligated to reimburse IFIC for amounts paid to Customs | Duties must be legally fixed and final before reimbursement; challenge pending | SLM must indemnify IFIC; payments were required under the bonds regardless of CIT outcome |
Key Cases Cited
- Cadle Co. v. Whataburger of Alice, Inc., 174 F.3d 599 ((5th Cir. 1999)) (illustrates jurisdictional considerations in related actions)
- Save Power Ltd. v. Syntek Fin. Corp., 121 F.3d 947 ((5th Cir. 1997)) (analysis of overlap and discretionary limits in first-to-file contexts)
- W. Gulf Maritime Ass'n v. ILA Deep Sea Local 24, 751 F.2d 721 ((5th Cir. 1985)) (considerations of overlap and forum-specific interests in concurrent actions)
- Mann Mfg., Inc. v. Hortex Inc., 439 F.2d 403 ((5th Cir. 1971)) (case cited regarding factors for overlapping litigation and efficiency)
- DePree v. Saunders, 588 F.3d 282 ((5th Cir. 2009)) (summary judgment standards and de novo review in state-law questions)