Timber Products Co. v. U.S.

• Decision Date: 08 November 2006
• Docket Number: Slip Op. 06-162. Court No. 01-00216.
• Parties: TIMBER PRODUCTS CO., Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

462 F.Supp.2d 1342

TIMBER PRODUCTS CO., Plaintiff, v. UNITED STATES, Defendant.

Slip Op. 06-162. Court No. 01-00216.

United States Court of International Trade.

November 8, 2006.

Sandler, Travis & Rosenberg, P.A., New York City (Beth C. Ring, Edward, M. Joffe) for Plaintiff.

Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director, Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch-Civil Division U.S. Department of Justice, (Edward F. Kenny); Barbara S. Williams, Attorney-in-Charge, International Trade Field Office, Commercial Litigation Branch — Civil Division, U.S. Department of Justice (Mikki Graves Walser), for Defendant.

OPINION

POGUE, Judge.

This matter is before the court pursuant to remand from the Court of Appeals for the Federal Circuit ("CAFC") of Timber Prods. Co. v. United States, 28 CIT ___, 341 F.Supp.2d 1241 (2004)¹ ("Timber I"). In Timber I, the court found, on cross-motions for summary judgment, that the U.S. Bureau of Customs and Border Protection ("Customs") correctly classified the Plaintiffs plywood entries under the residual subheading 4412.14.30² of the Harmonized Tariff Schedule of the United States ("HTSUS") rather than the more specific provision 4412.13.40³ advocated by Plaintiff, covering "plywood ... [w] ith at least one outer ply of ... `Virola.'" The CAFC vacated and remanded Timber I, directing that this court determine whether or not Plaintiff could prove a commercial designation for "Virola," as used in the plywood trade alone, that would apply to Plaintiff's entries at issue. Timber Prods. Co. v. United States, 417 F.3d 1198 (Fed.Cir. 2005) ("Timber II").

BACKGROUND

Plaintiff imported the subject entries of plywood from Brazil during 1996 and 1997. On its shipping and entry documents, Plaintiff identified the merchandise as "Sumauma (C. Petanda) Plywood," "Faveira (Parkia spp.) Plywood," "Amesclao (T. Burseaefolia) Plywood," "Brazilian White Virola Rotary Cut Plywood," "White Virola Plywood," "White Virola (Virola spp.) Plywood," and "Edaiply Faveira (Parkia spp.)." Except for "Virola" the species identified are not listed separately as tropical woods in the HTSUS.⁴ Therefore, Customs classified the entries under subheading 4212.14.30, HTSUS, as plywood with at least one outer face of non-coniferous wood. Plaintiff contends that Customs incorrectly classified these goods, because there is a commercial meaning of the term "Virola plywood"⁵ that encompasses many different woods, including "Sumauma" "Faveira" and "Amesclao."

Plaintiff admits that it cannot show that the entries at issue consisted of plywood with at least one outer ply of wood from a tree of the "Virola" genus⁶ (including all the species thereof, i.e. Virola spp.⁷) but insists before this court that the term "Virola" has a commercial designation, and that the entries at issue consisted of plywood with at least one outer ply of species that fit into the commercial designation for "Virola."⁸ In Timber I, the court found, primarily on the basis of statutory construction, that the Plaintiff did not prove the existence of any intent that the statute was meant to include a commercial designation of "Virola" that extended to species beyond the genus Virola. In this context, the court found that the Plaintiff did not produce sufficient evidence to support its "asserted commercial designation." Timber I, 28 CIT at ___, 341 F.Supp.2d at 1250-51.

The CAFC vacated the decision in Timber I, finding that the court "improperly required Timber [Plaintiff] to present evidence from outside the plywood trade," Timber II, 417 F.3d at 1202-03, and stating that "[t]he relevant trade for analyzing whether a tariff term has an established commercial meaning is determined by the merchandise before the court in a particular case, not by all the merchandise to which the tariff term might apply." Id. at 1202. The CAFC remanded the case to the court to "reconsider whether Timber proved a commercial meaning for `Virola' within the plywood trade alone." Id. at 1203.

In giving full effect to the CAFC's decision, the court recognizes that, by remanding the case and positing that this court must consider Plaintiff's proof of commercial designation within the plywood trade alone, the CAFC implicitly must have found that there was no Congressional intent evidenced in the statute that would trump any possible commercial designation. Cf. Witex, U.S.A, Inc. v. United States, 28 CIT ___, ___, 353 F.Supp.2d 1310, 1317 (2004) ("an established commercial meaning prevails over a common meaning unless contrary to Congressional intent.")(citing Maddock v. Magone, 152 U.S. 368, 371, 14 S.Ct. 588, 38 L.Ed. 482 (1894)); Cadwalader v. Zeh, 151 U.S. 171, 176, 14 S.Ct. 288, 38 L.Ed. 115 (1894).

Specifically, the CAFC must have found that the structure of Chapter 44 of the tariff schedule did not indicate a desire on Congress' part to have a uniform meaning for the term "Virola" that was preclusive of a commercial designation of the term "Virola" particular to the plywood trade. ("Virola" is mentioned several times throughout Chapter 44 of the HTSUS.⁹)

As both this court and the CAFC recognized, there is no definition of the term "Virola" provided in the HTSUS. Similarly, both this court and the CAFC found that the common meaning of the term "Virola" is "Virola spp."¹⁰ However, the CAFC found that though the term "Virola" is used in essentially the same manner throughout Chapter 44, such use was not sufficient evidence of statutory intent to preclude a contrary commercial designation in the plywood trade alone. Therefore, pursuant to the CAFC's remand, this court held a trial to permit Plaintiff to produce evidence that demonstrates that a commercial designation exists for the term "Virola" in the plywood trade alone and that the entries at issue meet such definition.

FINDINGS OF FACT

(A) Uncontested Facts

The parties have agreed to the facts that follow.

1. This action contests the tariff classification by Customs of certain plywood imported from Brazil into the United States through the Customs Port of Philadelphia on or between July 6, 1996, and December 2, 1997.

2. Timber Products Company ("Timber") is the importer of record of the merchandise in the entries which are the subject of this action.

3. The entries at issue were liquidated, as entered, on or between December 27, 1996 and October 16, 1998.

4. All liquidated duties, charges or exactions were timely paid and, with the exception of Protest No. 1001-97-100397 involving Entry No. 334-1009194-7, the parties agree that all of the entries at issue were timely protested.

5. Plywood consists of a panel composed of three or more sheets or "veneers" glued and pressed one on the other which are generally disposed so that the grains of successive layers are at right angles.

6. Each component veneer of plywood is referred to as a "ply."

7. Plywood is usually formed of an odd number of plies, with one outer ply called the "face," the other outer ply called the "backing," and the middle ply or plies called the "core."

8. While the individual plies comprising a panel of plywood may be of separate and distinct botanical species, plywood is identified in the trade based on the species of its "face" ply.

9. No single ply comprising the imported plywood exceeds 6 mm in thickness.

10. None of the imported plywood is surface covered.

11. The imported merchandise is described on the commercial invoices as Sumauma (C. Petanda) Plywood, Faveira (Parkia Spp.) Plywood, Amesclao (T. Burseaefolia) Plywood, Brazilian White Rotary Cut Plywood, White Virola Plywood, White Virola (Virola spp.) Plywood, and Edaiply Faveira (Parkia spp.).

12. During the time the imported plywood was entered, plywood with an outer ply of Virola was classifiable under subheading 4412.13.40, HTSUS.

13. Subheading 4412.13.40, HTSUS, was enacted by Presidential Proclamation, effective January 1, 1996.

14. At the time the imported plywood was entered, plywood from Brazil classifiable under subheading 4412.13.40, HTSUS, was duty-free under the Generalized System of Preferences ("GSP").

15. The imported merchandise is wholly the growth, product or manufacture of Brazil and was imported directly into the United States from Brazil.

16. The botanical identity of the species of each of the outer plies specifically, including each face ply, on each panel in each crate in each entry of the imported plywood is not known.

17. Virola is the name of a botanical genus consisting of approximately 45-60 different species. "Virola spp." denotes all species of the genus Virola. Virola is also a trade, common and/or commercial term.

18. Sumauma is a trade or common term used to identify the species Ceiba petandra which is of Latin American origin.

19. Faveira (also spelled Faveria) is a trade or common term used to identify all species of the genus Parkia (Parkia spp.) of Latin American origin.

20. Amasclao (also spelled Amesclao) is a trade or common term used to identify the species of the genera Trattinickia and Tetragastris of Latin American origin.

21. Entry No. 334-1009194-7 was entered by Plaintiff on January 28, 1997, as plywood with at least one outer ply of Virola under subheading 4412.13.40, HTSUS, at the rate of 8% ad valorem.

22. Entry No. 334-1009194-7 was imported from Brazil.

23. The commercial invoice associated with Entry No. 334-1009194-7 identifies merchandise imported under that entry as being "Faveira (Parkia spp.)."

24. Customs liquidated Entry No. 334-1009194-7, as entered by Plaintiff on May 16, 1997.

25. Plaintiff timely filed protest No. 1101-97-100373 on July 18, 1997, claiming the entry was properly classified on entry from Brazil and was duty free under the GSP.

26. Customs denied Protest No. 1101-97-100373 on August 4, 1997.

27. Plaintiff filed a timely summons of the denial of Protest No. 1101-97-100373 and voluntarily dismissed that action on November 8, 2001.

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