581 F.3d 1369 (Fed. Cir. 2009), 2008-1605, Faus Group, Inc. v. United States

Docket Nº:2008-1605.
Citation:581 F.3d 1369
Opinion Judge:PLAGER, Circuit Judge.
Party Name:FAUS GROUP, INC., Plaintiff-Appellant, v. UNITED STATES, Defendant-Appellee.
Attorney:Daniel G. Jarcho, McKenna Long & Aldridge LLP, of Washington, DC, argued for plaintiff-appellant. With him on the brief was Brett I. Harris, Pisani & Roll PLLC, of Washington, DC. Amy M. Rubin, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of N...
Judge Panel:Before SCHALL, PLAGER, and PROST, Circuit Judges.
Case Date:September 25, 2009
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 1369

581 F.3d 1369 (Fed. Cir. 2009)

FAUS GROUP, INC., Plaintiff-Appellant,

v.

UNITED STATES, Defendant-Appellee.

No. 2008-1605.

United States Court of Appeals, Federal Circuit.

September 25, 2009

Page 1370

Daniel G. Jarcho, McKenna Long & Aldridge LLP, of Washington, DC, argued for plaintiff-appellant. With him on the brief was Brett I. Harris, Pisani & Roll PLLC, of Washington, DC.

Amy M. Rubin, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of New York, NY, argued for defendant-appellee. With her on the brief were Barbara S. Williams, Attorney in Charge, and Jeanne E. Davidson, Director, of Washington, DC. Of counsel on the brief was Yelena Slepak, Attorney, Office of Assistant Chief Counsel, International Trade Litigation, United States Customs and Border Protection, of New York, NY.

Before SCHALL, PLAGER, and PROST, Circuit Judges.

PLAGER, Circuit Judge.

The issue in this classification case is whether laminated flooring panels imported by Faus Group, Inc. (Faus) are properly classified as " fiberboard" under heading 4411 of the Harmonized Tariff Schedules of the United States (HTSUS), as the United States Customs Service (Customs) classified the goods, or as " builders' joinery" under heading 4418, as Faus contends. The United States Court of International Trade sustained Customs's classification. For the reasons that follow, we hold that the proper classification is under heading 4418, and more specifically under subheading 4418.90.40, a residual provision. We therefore reverse the judgment of the Court of International Trade.

BACKGROUND

The imported goods at issue in this case are laminated flooring panels made with a core of fiberboard that has a density between 0.85 and 0.95 g/cm 3. A color photograph overlay on each panel simulates the appearance of a natural wood product. The panels are non-structural finished articles designed to be installed by end users over a structural subfloor. Each panel has tongue-and-groove joints on its edges to facilitate assembly with other like flooring panels.

Customs classified the flooring panels under HTSUS heading 4411,1 which reads: " Fiberboard of wood or other ligneous materials, whether or not bonded with resins or other organic substances." Within heading 4411, Customs classified the goods under subheading 4411.19.40, a residual provision that reads: " Fiberboard of a density exceeding 0.8 g/cm 3: Other: Other: Other." The duty rate for subheading 4411.19.40 is 6% ad valorem.

Faus protested Customs's classification. After Customs denied the protest, Faus filed suit in the Court of International Trade. Faus's complaint alleged that the merchandise is properly classifiable under heading 4418, which reads: " Builders' joinery and carpentry of wood, including cellular wood panels and assembled parquet panels; shingles and shakes." Faus asserted that within heading 4418 the proper subheading is 4418.30.00 (" Parquet panels"), free of duty. In the alternative,

Page 1371

Faus urged that the goods should be classified under subheading 4418.90.40 (" Other: Other"), at the rate of 3.2% ad valorem.

In response to the Government's position, Faus further alleged that if its flooring products are to be classified under the Government's preferred heading of 4411, the proper subheading is 4411.19.30, which reads: " Fiberboard of a density exceeding 0.8 g/cm 3: Other: Other: Tileboard which has been continuously worked along any of its edges and is dedicated for use in the construction of walls, ceilings or other parts of buildings." Subheading 4411.19.30 is a duty-free provision.

The parties filed cross-motions for summary judgment. In a fifty-three page analysis, an analysis that can only be described as Talmudic in its breadth and thoroughness, the trial court parsed the verbiage contained in the competing headings, explored dictionary definitions, and sorted through a wealth of prior cases on the construction of HTSUS headings. Faus Group, Inc. v. United States, 358 F.Supp.2d 1244 (Ct. Int'l Trade 2004). The trial court determined that the imported goods are prima facie classifiable under both heading 4418 and heading 4411. Id. at 1249-65. The court then applied General Rule of Interpretation (GRI) 3(a), the rule of relative specificity, to conclude that the products should be classified under heading 4411 because it is the more specific of the two...

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