United States v. American Home Assurance Company

In 1997, the United States Department of Commerce (commerce) ordered the imposition of antidumping duties on crawfish-tail meat from China. JCOF (USA) International, Inc. (JCOF), a New York-based importer, began working with Yangzhou Lakebest Foods Company, Ltd. (Yangzhou), a Chinese exporter of crawfish meat, in 2001. Because Yangzhou was a new exporter, JCOF had the option to post a customs bond in lieu of making a cash antidumping-duty deposit to commerce based on the rates of the 1997 order issued by commerce until commerce concluded a new-exporter review of Yangzhou and determined the antidumping-duty rates Yangzhou should pay. JCOF contracted with American Home Assurance Company (AHAC) (defendant), a surety, to issue the customs bond required to import crawfish meat. After commerce concluded its new-exporter review of Yangzhou, commerce directed the United States Bureau of Customs and Border Protection (customs) (plaintiff) to liquidate JCOF’s import entries. Although customs billed JCOF for duties due, including antidumping duties, JCOF failed to make the payments. Customs then sought payment from AHAC, which, as surety, was jointly and severally liable for all duties. AHAC denied liability, and customs sued AHAC demanding payment of the antidumping duties as well as interest accrued since the date of liquidation as provided under 19 U.S.C. § 580, which stated that interest was allowed upon “all bonds” on which suits were brought “for the recovery of duties.” AHAC argued that § 580 applied only to traditional custom duties and not antidumping duties. The United States Court of International Trade ruled in favor of AHAC, and customs appealed.