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The underlying issue has to do with a determination by the International Trade Commission that certain imported digital televisions infringed a U.S. patent. As a result, the ITC issued an exclusion order requiring Customs and Border Protection to prohibit entry of the infringing televisions. This all happens under 19 U.S.C. sec. 1337 in what is called a 337 case.

Following the exclusion order, some of the infringers developed a work-around to produce what they believed to be non-infringing televisions. They then went to Customs to get a ruling confirming the admissibility of the new televisions. Customs provided the ruling. Seeing the value of their exclusion order evaporate, the patent holder went to the Court of International Trade seeking a declaratory judgment or other relief holding that Customs has no authority to determine the scope of an ITC exclusion order. Rather, that task should fall to the ITC. The defendant (that is the importer of the re-engineered televisions) moved to dismiss the case for lack of subject-matter jurisdiction.

The Court reviewed the somewhat checkered past of cases considering the jurisdiction of the CIT to hear cases similar to this. If the Court has jurisdiction, it would be via the statute giving it jurisdiction to grant declaratory relief or under the Court's so-called residual jurisdiction.

On declaratory judgment, 28 USC 1581(h), the Court provided little analysis other than to followed a prior case, Eaton Corp., finding no jurisdiction under 1581(h). Further, the Court found no case in which a similarly situated plaintiff had secured (h) jurisdiction.

Regarding residual jurisdiction under 28 USC 1581(i), the court noted the absence of an issue involving (1) revenue from imports or tonnage or (2) tariffs, duties, fees, or other taxes on imports. That knocked out 1581(i)(1) and 1581(i)(2). Because no embargo or quantitative restriction is involved, 1581(i)(3) does not provide jurisdiction. Note that the Supreme Court has said the exclusion of merchandise infringing intellectual property rights does not count as an embargo or quantitative restriction. Lastly, the broad grant of jurisdiction under (i)(4) is linked to the administration and enforcement of the items subject to review under (i)(1) through (i)(3), that (i)(4) did not provide jurisdiction either.

Plaintiff's last resort was an appeal to the general, but non-statutory, authority of the Court of International Trade to resolve civil actions arising out of federal laws regulating import transactions. While that is manifestly true, it is also somewhat aspirational. As the Court of Appeals for the Federal Circuit has re-affirmed, the CIT's actual jurisdiction is determined by actual statutes and cannot be expanded by judicial decision. Consequently, the lack of a statutory basis on which the Court may assume jurisdiction dooms the plaintiff's efforts.

The Court clearly wanted to hear the case. Early on in the discussion of the jurisdiction provision, Senior Judge Aquilino states explicitly, "the undersigned has not doubted the intent of its framers than an action like this be subject to the jurisdiction of the Court of International Trade." In the end, though, he was compelled to leave changing the law to, what he characterized as, "higher authority."

Where does that leave us? Well, the CBP ruling is still valid because it can't be reviewed. Should CBP have issued it to start with? That question will have to wait for word from either the Federal Circuit or a district court somewhere that might have jurisdiction.

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