G.G. Marck & Associates, Inc. v. United States, 061715 USCIT, 08-00306

Docket Nº:08-00306
Opinion Judge:RICHARD K. EATON, JUDGE
Party Name:G.G. MARCK & ASSOCIATES, INC., Plaintiff, v. UNITED STATES, Defendant. Slip Op. 15-62
Attorney:Edmund Maciorowski, Edmund Maciorowski P.C., of Bloomfield Hills, MI, argued for plaintiff. Jason M. Kenner, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of New York, NY, argued for defendant. With him on the brief were Stuart F. Delery, Actin...
Case Date:June 17, 2015
Court:Court of Appeals of International Trade
 
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G.G. MARCK & ASSOCIATES, INC., Plaintiff,

v.

UNITED STATES, Defendant.

No. 08-00306

Slip Op. 15-62

Court of Appeals of International Trade

June 17, 2015

In this classification case, defendant's motion for summary judgment is granted, in part, and plaintiff's cross-motion for summary judgment is granted, in part.

Edmund Maciorowski, Edmund Maciorowski P.C., of Bloomfield Hills, MI, argued for plaintiff.

Jason M. Kenner, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of New York, NY, argued for defendant.

With him on the brief were Stuart F. Delery, Acting Assistant Attorney General, Amy M. Rubin, Acting Assistant Director, and Barbara S. Williams, Attorney in Charge.

Of counsel on the brief was Beth Brotman, Office of the Assistant Chief Counsel, International Trade Litigation, United States Customs and Border Protection.

OPINION

RICHARD K. EATON, JUDGE

Before the court are the cross-motions for summary judgment of plaintiff G.G. Marck & Associates, Inc. ("plaintiff" or "Marck") and defendant United States ("defendant") on behalf of the United States Customs and Border Protection Agency ("Customs"). Def.'s Mot. for Summ. J. (ECF Dkt. No. 57); Pl.'s Am. Mot. for Summ. J. (ECF Dkt. No. 70). The court has jurisdiction pursuant to 28 U.S.C. § 1581(a). At issue is the proper classification of ninety-one cups and mugs imported by plaintiff between August 3, 2006 and September 18, 2006. See Summons at 1, 3 (ECF Dkt. No. 1).

Plaintiff commenced this lawsuit after its timely-filed protest was denied by Customs and the assessed duties were paid. See Compl. ¶¶ 2, 3 (ECF Dkt. No. 9); Answer ¶¶ 2, 3 (ECF Dkt. No. 10). Plaintiff initially pursued the issues presented here in court number 06-00094 as a test case, but moved for voluntary dismissal on May 18, 2010 following the filing of motions for summary judgment. See Stipulation of Dismissal, Marck & Assocs., Inc. v. United States, Ct. No. 06-00094 (May 18, 2010), ECF Dkt. No. 97; Pl.'s Mot. for Summ. J., Marck & Assocs., Inc. v. United States, Ct. No. 06-00094 (Dec. 15, 2009), ECF Dkt. No. 83; Def.'s Mot. for Summ. J., Marck & Assocs., Inc. v. United States, Ct. No. 06-00094 (Dec. 10, 2009), ECF Dkt. No. 80. On September 7, 2010, the court designated this matter a test case pursuant to USCIT Rule 84 and suspended related court actions filed by plaintiff between March 31, 2006 and July 26, 2010.1Order (ECF Dkt. No. 16). Seven additional lawsuits, filed subsequently by plaintiff, have since been suspended pending the disposition of this test case.2

For the reasons set forth below, defendant's motion for summary judgment is granted, in part, and plaintiff's motion for summary judgment is granted, in part, and the court finds that (1) five articles are properly classified under Harmonized Tariff Schedule of the United States ("HTSUS") subheading 6912.00.39, as "Ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china" that are "Available in specified sets, "3 (2) fifty-eight articles are properly classified under HTSUS subheading 6912.00.44, "Mugs and other steins, "4 and (3) twenty-eight articles are properly classified under HTSUS subheading 6912.00.48, "Other."5

BACKGROUND

The facts described below have been taken from the parties' stipulated facts, admitted portions of plaintiff's USCIT Rule 56(h) statement, 6 and findings based on record evidence on which no reasonable fact-finder could come to an opposite conclusion. See Chrysler Corp. v. United States, 24 CIT 75, 91, 87 F.Supp.2d 1339, 1354 (2000). Marck, a distributer of ceramic tableware, is the importer of record of the contested merchandise, stoneware cups and mugs, from Chinese manufacturer Shandong Zibo Niceton-Marck Huaguang Ceramics Ltd. ("Huaguang" or the "manufacturer"). See Pl.'s Statement of Material Facts as to Which There Are No Genuine Issues to Be Tried ¶¶ 111, 112 (ECF Dkt. No. 70) ("Pl.'s Rule 56(h) Statement"). The items are imported separately and not as sets. See Mem. in Supp. of Def.'s Mot. for Summ. J. (ECF Dkt. No. 57) ("Def.'s Br."), Ex. 1 at 26.

At liquidation, Customs classified all of the merchandise under Heading 6912 of the HTSUS ("Ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china"). See Summons at 2. Customs, however, classified merchandise it found to be "mugs" under subheading 6912.00.44 as "Mugs and other steins" at 10 percent ad valorem, and those items it found to be "cups" under subheading 6912.00.48 as "Other" at 9.8 percent ad valorem. See Summons at 2; App. 4 to Pl.'s Br. in Supp. of Mot. for Summ. J., Aff. of Raymond Guan ("Guan Aff."), Ex. 1 ("Niceton Invoices").

Marck timely protested Customs' classifications of the merchandise and urged that its merchandise7 should have been classified under subheading 6912.00.39 at 4.5 percent ad valorem:

6912.00 Ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china:

Tableware and kitchenware: . . .

Other: . . .

Other:

Available in specified sets: . . . 6912.00.39 In any pattern for which the aggregate value of the articles listed in additional U.S. note 6(b) of this chapter is over $38

See Subheading 6912.00.39 of Chapter 69, HTSUS (2006) (emphasis added); Compl. ¶ 2; Answer ¶ 2; Niceton Invoices.

The phrase "[a]vailable in specified sets" is the subject of the Additional U.S. Notes ("U.S. Notes"), which form a part of the HTSUS.8 See Additional U.S. Note 6(b), HTSUS ("U.S. Note 6"); Del Monte Corp. v. United States, 730 F.3d 1352, 1355 (Fed. Cir. 2013) ("Included among the specified 'notes' are Additional U.S. Notes, which Customs describes as 'legal notes that provide definitions or information on the scope of the pertinent provisions or set additional requirements for classification purposes' and which are 'considered to be statutory provisions of law for all purposes.'" (citation omitted) (quoting U.S. Customs & Border Prot., What Every Member of the Trade Community Should Know About:Tariff Classification 32 (2004))). As shall be explained in more detail hereinafter, in accordance with U.S. Note 6(b), the inclusion under the phrase "available in specified sets" requires that specific articles of particular sizes (e.g., plates, tea cups, soups, fruits, a platter or chop dish, an open vegetable dish or bowl, a sugar, and a creamer) be "sold or offered for sale in the same pattern." See U.S. Note 6(a), (b).

As is relevant here, Marck offers a number of different lines of dinnerware merchandise, one of which it describes as falling under the trademark "Cancun' Vitrified" ("Cancun"). See Def.'s Br., Ex. 5 at 48 ("Marck Catalog"). In Marck's catalog, "Cancun" trademarked items are offered in nine basic solid colors: Stanford red, black, cobalt, ocean blue, California orange, lemon, hunter green, white, and natural.9 See Marck Catalog at Marck & Associates Color Codes, 49. Dinnerware items identified by Marck as being covered by the "Cancun" trademark include the following items: 10 ¼ inch plates, 6 5/8 inch plates, 7 ounce tall cups, 6 inch saucers, 7 inch bowls, 4 ¾ inch 4 ounce fruit bowls, 13 ¼ inch platters, 10 inch bowls, sugar bowls with lids, and 14 ounce creamers. See Pl.'s Rule 56(h) Statement ¶ 115. Although it does not identify them as part of the "Cancun" line (or any other line), Huaguang, the manufacturer, sells the 10 ¼ inch plates, 6 5/8 inch plates, 7 ounce tall cups, 6 inch saucers, 7 inch bowls, and 4 ¾ inch 4 ounce fruit bowls in packages of twelve, and the 13 ¼ inch platters, 10 inch bowls, sugar bowls with lids, and 14 ounce creamers in packages of one. See Guan Aff. ¶ 22, Ex. 5; App. 5 to Pl.'s Br. in Supp. of Mot. for Summ. J., Aff. of Christopher Miller ¶ 37, Ex. 5 ("Miller Aff."). The total price of any combination of the seventy-seven articles constituting a complete set under the "Cancun" trademark, at the time of importation, exceeded $38.00. Pl.'s Rule 56(h) Statement ¶ 126.

STANDARDOFREVIEW

Summary judgment shall be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." USCIT R. 56(c) (2015); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48 (1986). In the context of a customs classification case, summary judgment is appropriate when "there is no factual dispute regarding what the merchandise is." Sony Elecs., Inc. v. United States, 37 CIT __, __, Slip Op. 13-153, at 5 (2013) (citing Faus Grp., Inc. v. United States, 581 F.3d 1369, 1372 (Fed. Cir. 2009)). "When both parties move for summary judgment, the court must evaluate each motion on its own merits, resolving all reasonable inferences against the party whose motion is under consideration." JVC Co. of Am., Div. of U.S. JVC Corp. v. United States, 234 F.3d 1348, 1351 (Fed. Cir. 2000) (citing McKay v. United States, 199 F.3d 1376, 1380 (Fed. Cir. 1999)). "When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986) (footnote omitted) (citations omitted). That is, "the nonmoving party must come forward with 'specific facts showing that there is a genuine issue for trial.'" Id. at 587 (citation omitted) (quoting Fed.R.Civ.P. 56(e)).

DISCUSSION

I. Legal Framework

Classification of imported merchandise involves a two-step inquiry: "first, construe the relevant classification headings; and second, determine under which of the properly construed tariff terms the merchandise at issue falls." Bausch & Lomb, Inc. v. United...

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