United States v. Chavez , 2016 CIT 26 ( 2016 )

Slip Op. 16 - 26
UNITED STATES COURT OF INTERNATIONAL TRADE
____________________________________
:
UNITED STATES, :
:
Plaintiff, :
:
v. : Before: R. Kenton Musgrave, Senior Judge
: Court No. 12-00104
JUAN CARLOS CHAVEZ, and :
CHAVEZ IMPORT & EXPORT, INC., :
:
Defendants. :
____________________________________:
JUDGMENT
The plaintiff, United States, having commenced this case pursuant to 19 U.S.C. §1592
and 28 U.S.C. §1582 on April 12, 2012 via summonses and a complaint seeking to recover, after
collecting on bond(s), unpaid duties totaling US$40,288.82, against the defendant Juan Carlos
Chavez in the remaining amount of US$8,773.77 and against the defendant Chavez Import & Export,
Inc. (“CIE”) in the remaining amount of US$31,515.05, and assess penalties against the defendant
Juan Carlos Chavez in the amount of US$25,441.72 (allegedly twice the amount of duties of which
the United States was deprived), and against the defendant CIE in the amount of of US$105,916.50
(allegedly the domestic value of the merchandise that was the subject of the false statements), for
a total of US$131,358.22 against the defendants, allegedly resulting from misclassifications in
violation of 19 U.S.C. §1592 of seven entries, to wit, APJ-00053366, AWB-00056832,
AWB-00056840, AWB-00066146, AWB-00067110, AWB-00068118, and AWB-00068753,
declaring “Soft Dairy Express” under the Harmonized Tariff Schedule of the United States
Court No. 12-00104 Page 2
(“HTSUS”) in either HTSUS 0405.20.4000 (dairy spreads: butter substitutes, whether in liquid or
solid state, other than those containing over 45 percent by weight of butterfat) and/or “White
Cheese” classifiable under HTSUS 0406.90.9900 (cheeses and curds that do not contain cow’s milk),
and also incorrectly claiming duty-free treatment under the Caribbean Basin Economic Recovery
Act; the plaintiff alleging that the correct classifications of those entries are under HTSUS
1901.90.4300 (certain dairy products containing over 10 percent by weight of milk solids) or HTSUS
0406.90.9700 (cheeses and curds that do contain cow’s milk), neither of which classifications qualify
for duty-free treatment under the Caribbean Basin Economic Recovery Act; and also alleging that
some of the entries contained false valuations allowing them to be processed through informal entry
without surety bonds; and also alleging that (amended) pre-penalty notices and demands for duties
and penalty notices were issued to the defendants; and also alleging that on April 14, 2010 the
defendants executed waivers for a period of two years concerning any statutes of limitation defenses
with respect to the entries for which the defendants were an importer of record; and also alleging that
U.S. Customs and Border Protection (“Customs”) did not receive any written notice from the
defendant corporation pursuant to Florida Statute 607.1406 informing of any claims that Customs
might be entitled to assert against said corporation and that said corporation did not publish or file
a notice of dissolution pursuant to Florida Statute 607.1407 in order to address claims that were
unknown to it; and the defendant Juan Carlos Chavez having filed an answer to the complaint on
April 22, 2014 denying the substance of the plaintiff’s allegations as to misclassification; and court
on April 22, 2015 having issued an order to show cause why the matter should not be dismissed for
lack of prosecution; and the plaintiff having responded on April 30, 2015 via request to the Clerk
Court No. 12-00104 Page 3
of the Court to enter default against the defendant CIE; and the Clerk of the Court having done so
on May 5, 2015, ECF No. 23; and the plaintiff on May 4, 2015, having moved for summary
judgment against the defendant Juan Carlos Chavez; and the court having granted three unopposed
motions for extension of time to the defendant Juan Carlos Chavez to respond to the plaintiff’s
motion for summary judgment; and the defendant Juan Carlos Chavez having been provided with
duplicate copies of the plaintiff’s motion for summary judgment, ECF No. 38 (Sep. 29, 2015), and
having been ordered on January 19, 2016 to show cause why judgment should not be entered in favor
of the plaintiff; see ECF No. 42, and the court having received no response or even other contact
from the defendant Juan Carlos Chavez as of this date; Now, therefore, it is hereby
ORDERED that the plaintiff’s motion for summary judgment, ECF No. 22, be, and
hereby is, granted, and it is further
ORDERED, ADJUDGED, AND DECREED that plaintiff recover from defendant
Juan Carlos Chavez the amount of $8,773.77 in unpaid duties, plus pre-judgment interest on the
amount of $8,773.77 calculated from June 14, 2010, plus post-judgment interest on the amount of
$8,773.77, plus a civil penalty of $25,441.72, plus post-judgment interest on that amount, plus costs
to the government, and it is further
ORDERED that the plaintiff provide a status report or motion on the remainder of
this case by May 2, 2016.
/s/ R. Kenton Musgrave
R. Kenton Musgrave, Senior Judge
Dated: March 25, 2016
New York, New York