Customs
Import
Tariff Classification
Harmonized Tariff Schedule of the United States
HTSUS
Binding Pre-importation Ruling from U.S. Customs
and Border Protection (“Customs”) on the Tariff Classification
Ruling Letter
Protest
Domestic Interested Party Petition
Informed Compliance Publication (ICP)
Duty-Free Entry
Tariff Classification of Textile Costumes
Ejusdem Generis
Appeal from the United States Court of
International Trade in No. 1:13-cv-00407-MAB, Judge Mark A. Barnett.
Rubies Costume Company appeals the grant of
summary judgment by the Court of International Trade in favor of the Government
as to the tariff classification of certain imported merchandise. The imported
merchandise consists of a nine-piece Santa Claus costume packaged and sold
together as a set. The Santa Claus costume is customarily worn in connection
with the celebration of the Christmas holiday. The parties argue as to the
implications of the “festive” nature of the costume. The merchandise, however,
is excluded from classification as “festive articles” by the notes to chapter
95 of the Harmonized Tariff Schedule of the United States. The correct
classification of the merchandise is under HTSUS 6110.30.30, 6103.43.15,
6116.93.94, and 4209.92.30. On that basis, we affirm the judgment of the Court
of International Trade.
On June 20, 2012, Rubies requested a binding
pre-importation ruling from U.S. Customs and Border Protection (“Customs”) on
the tariff classification of the Santa Suit. Exactly one year later, Customs
issued Ruling Letter HQ H237067 in which it classified the Santa Suit under
several tariff classifications of the Harmonized Tariff Schedule of the United
States (“HTSUS”). See Customs Ruling HQ H237067 (June 20, 2013), 2013 WL
3783025, at *1. On October 25, 2013, after Rubies entered the subject
merchandise, Customs applied its HQ H237067 ruling and liquidated the entry of
the Santa Suit according to the following classifications and duty rates for
each piece: (…).
Rubies protested the liquidation of the entry
pursuant to 19 U.S.C. § 1514(a). Rubies contended that all nine pieces of the
Santa Suit fall under HTSUS chapter 95 as “festive . . . articles,” requiring
duty-free entry, and requested an accelerated disposition of the protest.
Customs did not render a decision on the protest within thirty days, so the protest
was deemed denied under 19 U.S.C. § 1515(b) on December 14, 2013. On December
27, 2013, Rubies filed suit in the CIT, challenging the denied protest.
The classification of goods under the HTSUS
requires a two-step process. First, the court “determines the proper meaning of
specific terms in the tariff provisions, which is a question of law that we
review without deference.” Gerson, 898 F.3d at 1235. Second, the
court determines whether the subject merchandise falls within the description
of such terms as properly construed, which is a question of fact that we review
for clear error. La Crosse Tech., Ltd. v. United States, 723 F.3d 1353,
1358 (Fed. Cir. 2013). If there is “no dispute as to the nature of the
merchandise, the two-step classification analysis collapses entirely into a
question of law.” Gerson, 898 F.3d at 1235.
The HTSUS comprises a hierarchical structure
that separates goods by headings and subheadings. Otter Prods., 834 F.3d
at 1375. The General Rules of Interpretation (“GRIs”) of the HTSUS and the
Additional United States Rules of Interpretation govern the classification of
goods. Id. We apply the GRIs in numerical order, starting with GRI 1. Carl
Zeiss, Inc. v. United States, 195 F.3d 1375, 1379 (Fed. Cir. 1999).
GRI 1 provides that “classification shall be
determined according to the terms of the headings and any relative Section or
Chapter notes.” “We apply GRI 1 as a substantive rule of interpretation, such
that when an imported article is described in whole by a single classification
heading or subheading, then that single classification applies, and the
succeeding GRIs are inoperative.” La Crosse Tech., 723 F.3d at 1358
(quoting CamelBak Prods., LLC v. United States, 649 F.3d 1361, 1364
(Fed. Cir. 2011)). We interpret HTSUS terms according to their common and
commercial meaning unless there is contrary legislative intent and may consult
dictionaries, scientific authorities, and other reliable sources to ascertain the
common meaning. Otter Prods., 834 F.3d at 1375.
(…) We cite to the 2013 version of the HTSUS in
effect on the date of importation. See LeMans Corp. v. United States,
660 F.3d 1311, 1314 n.2 (Fed. Cir. 2011).
(…) This court previously addressed the tariff
classification of textile costumes in Rubie’s Costume Co. v. United States,
337 F.3d 1350, 1352 (Fed. Cir. 2003) (“Rubies I”).
In Rubies I, Rubies, the largest
manufacturer of costumes in the United States, filed a Domestic Interested
Party Petition, asserting that Customs should classify certain textile
Halloween costumes manufactured by others being imported into the United States
as articles of apparel under chapter 61 or 62. Rubies contended that
these costumes were virtually identical to those manufactured by Rubies, and
that Customs had erroneously classified them as duty-free “festive articles.”
Following Rubies I, Customs issued an
Informed Compliance Publication, identifying factors that distinguish flimsy,
nondurable costumes classified in chapter 95 from those that are well-made,
comparable to normal wearing apparel classified in chapters 61 and 62. U.S.
Customs & Border Prot., Classification of Textile Costumes Under the HTSUS
(2008), https://www.cbp.gov/sites/default/files/documents/icp077_3.pdf (“Textile
Costume ICP”). The Textile Costume ICP establishes four distinguishing
factors to consider in determining whether the costume is flimsy or well made:
styling, construction, finishing touches, and embellishments. Customs relied on
the Textile Costume ICP in classifying the Santa Suit in Ruling Letter HQ
H237067. Although not binding on this court, the ICP provides examples for each
factor and guidance as to Customs’ analysis in this matter.
Classification of the Santa Suit requires a two-step
process: (1) determining the meaning of terms in the HTSUS, a legal question, Gerson,
898 F.3d at 1235; and (2) determining whether the subject merchandise falls
within the description of such terms as properly construed, a factual question,
La Crosse Tech., 723 F.3d at 1358. The two-step classification inquiry
ends at step one and remains solely a legal question if the nature of the
merchandise is not in dispute. See Gerson, 898 F.3d at 1235.
That a person wears the Santa Suit or portions
thereof during festive Christmas holiday occasions does not preclude it from
classification as “fancy dress” of textile material. Indeed, the “fancy dress,
of textiles, of chapter 61 or 62” exclusion under Note 1(e) of chapter 95
presumes that we may otherwise recognize the subject merchandise as a festive
article, unless it qualifies as fancy dress, i.e., a costume, of textile
material. Thus, an article classified as “fancy dress of textile material” can
plainly constitute a costume worn on festive occasions without conflicting with
the requirement set forth in Rubies I that a “festive article” is “not
generally recognized as normal wearing apparel.”
The CIT determined that the classification for
the Santa Suit jacket is HTSUS 6110.30.30, which covers “sweaters, pullovers,
sweatshirts, waistcoats (vests) and similar articles, knitted or crocheted . .
. of man-made fibers . . . other.” J.A. 39. Applying the styling, construction,
and finishing touch factors noted above, the undisputed facts establish that
the Santa Suit jacket has the features of a well-made textile costume,
classifiable as wearing apparel under HTSUS chapter 61. The jacket has woven
satin fabric lining and is constructed of an acrylic and polyester knit pile
fabric. The jacket also has a double- layer collar with white faux fur fabric
and a front snap closure, a full-length zipper concealed by white faux fur,
finished edges with white faux fur cuffs, double-layer belt- loops, and
well-sewn seams. The jacket does not have any embellishments, but that does not
change the well-made nature of the jacket based on other factors.
Additionally, the record shows that Rubies
manufactures the jacket so that it can be worn and cleaned multiple times
throughout the Christmas season, such that the jacket may survive several
Christmas seasons. The jacket requires “Dry Clean Only” care. These, along with
the factors described above, are all characteristics of normal wearing apparel,
and there is no dispute that the jacket is of durable and nonflimsy
construction.
Although the precise term for the type of jacket
included with the Santa Suit does not appear in the list of items in heading
6110, the jacket shares the characteristics of the named articles in the
heading. Like a sweater or sweatshirt, the jacket covers the upper body and
provides some warmth to the wearer but does not protect against wind, rain, or
extreme cold. The wearer can also wear the jacket over either undergarments or
other clothing. Thus, we hold that heading 6110 covers the Santa Suit jacket under
the rule of ejusdem generis because the jacket shares the essential
characteristics of the articles named in the heading. See Victoria’s Secret
Direct, LLC v. United States, 769 F.3d 1102, 1107 (Fed. Cir. 2014). The CIT
therefore correctly found that the proper classification for the jacket is
under HTSUS heading 6110, which excludes it from classification as a “festive
article.”
(…) Based on the foregoing, we hold that the
items of merchandise in question are articles of normal wearing apparel, and that
the tariff classifications for the Santa Suit jacket, pants, and gloves are,
respectively, HTSUS 6110.30.30, 6103.43.15, and 6116.93.94. The classification
for the toy sack is HTSUS 4209.92.30. On that basis, the judgment of the CIT is
affirmed.
(U.S. Court of Appeals for the Federal Circuit,
April 29, 2019, Rubies Costume Company, v. United States, Docket No. 2018-1305,
Circuit Judge Reyna)
No comments:
Post a Comment