United States v. Creative Compounds, LLC., No. 07-3671
Creative Compounds imported 8,800 pounds of powdered egg whites from Peru. Initially, Creative Compounds intended the powdered egg whites, a protein ingredient, to be for human consumption in nutritional products. The price for powdered egg whites in the United States had risen, and Creative Compounds sought a cheaper version from Peru.
Egg product imports are regulated by two statutes. The first, the Animal Health Protection Act (“AHPA”), regulates egg products intended for animal consumption. The second, the Egg Products Inspect Act (“EPIA”) regulates egg products intended for human consumption. The EPIA restricts importation of egg products for use as human food unless they were processed under “an approved continuous inspection system of the government of the foreign country of origin.” 21 U.S.C. 1046(a)(2). Currently, only Canada and the Netherlands maintain a continuous inspection system equal to that of the United States.
Creative Compounds sought and received an import permit from the government to allow importation of the 8,800 pounds of powdered egg whites from Peru. However, the import permit noted that the product must be accompanied by an original certificate from the government of Peru stating that the product complied with AHPA regulations. Creative Compounds did not obtain such a certificate. The product was shipped from Peru to New York, then transported to Chicago, where it was mistakenly allowed through Customs, and then was moved to Creative Compounds’ warehouse in Missouri.
The government learned of that the powdered egg whites had been imported in violation of the EPIA and detained them until Creative Compounds could obtain the required certification from Peru. When Creative Compounds could not obtain a certificate, the government filed a lawsuit to seize the product and destroy it. The trial court granted the United States’ motion for summary judgment, noting that after the powdered egg whites cleared Customs and was transported to Missouri, they became a domestic article under the EPIA and, therefore, could not be transported to sold.
On appeal, Creative Compounds argued that it should be allowed to return the powdered egg whites to Peru. The Eighth Circuit disagreed, following the trial court’s strict interpretation of the EPIA.
