The U.S. Court of International Trade (“CIT”) issued a final opinion in Virtus Nutrition LLC’s (“Virtus”) challenge to Customs and Border Protection’s (“CBP”) detention of Malaysian palm oil imports, rejecting Vitrus’ request that the CIT confirm the importer’s right to re-export the shipment. Please see link to case [here].
CBP detained the shipment in early 2021 alleging that the palm oil was subject to a withhold release order (“WRO”) issued against Sime Darby Plantation Berhad. See link [here]. To obtain release of the shipment, Virtus provided CBP with extensive documentation concerning the production process. However, CBP found the documentation was not sufficient and instructed Virtus to export or destroy the merchandise within a 60-day time frame. Virtus filed a protest on CBP’s decision, which CBP denied, claiming insufficient documentation. Virtus brought the case before the CIT to contest the denial of the protest. (Virtus Nutrition, LLC v. United States, CIT #21-00165). Prior to the appeal, Virtus and CBP entered into a temporary storage agreement stating that Virtus could export the merchandise.
After filing the appeal Virtus sought to dismiss the case, effectively conceding that it could not prove CBP’s detention was unlawful but requested the CIT order that Virtus be allowed to re-export the goods pursuant to the storage agreement. CBP agreed that the case should be dismissed with prejudice but argued that the CIT does not issue an order allowing export of the goods because the storage agreement would apply only if Virtus sought a final decision from the court.
In its December 15, 2022, opinion, the CIT dismissed the case and denied Virtus’s request to export the goods. The court found that CBP is allowed to seize the goods as they deem appropriate. If CBP seized the goods, and did not allow Vitrus to export, which is common in WRO proceedings, then the court noted that Virtus may challenge CBP’s decision pursuant to 28 USC § 1356. Finally, the Court also denied the American Apparel & Footwear Association’s bid to join the suit as an amicus curiae. It is unlikely Virtus will appeal its loss.
In the end, the case did not provide insight into the evidence needed to successfully challenge CBP forced labor detentions. The importing community was hoping for such guidance but will have to wait.