Belimo Automation A.G. v. United States

• Decision Date: 26 November 2013
• Docket Number: Slip Op. 13- 144,Court No. 10-00113
• Parties: BELIMO AUTOMATION A.G., Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

BELIMO AUTOMATION A.G., Plaintiff, v. UNITED STATES, Defendant.

Slip Op. 13- 144 Court No. 10-00113

UNITED STATES COURT OF INTERNATIONAL TRADE

Dated: November 26, 2013

PUBLIC VERSION

Before: Mark A. Barnett, Judge

OPINION

[The court finds that the subject imports were properly classified as "electric motors" under HTSUS 8501.10.40 and that they are not classified under HTSUS 9032.89.60. Accordingly, the court denies Plaintiff's motion for summary judgment and grants Defendant's cross motion for summary judgment.]

Robert B. Silverman, Peter W. Klestadt, and Robert F. Seely, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt, LLP of New York, NY, for Plaintiff Belimo Automation A.G.

Stuart F. Delery, Assistant Attorney General, Civil Division, Department of Justice, Commercial Litigation Branch, New York, New York, for Defendant United States. With him on the brief were Barbara S. Williams, Attorney-in-Charge, and Amy M. Rubin, Acting Assistant Director. Of Counsel was Michael W. Heydrich, Office of Assistant Chief Counsel, International Trade Litigation, U.S. Customs and Border Protection, of New York, NY.

Barnett, Judge: The case is before the court on cross-motions for summary judgment. Belimo Automation A.G. ("Belimo") contests the denial of its protest in which U.S. Customs and Border Protection ("Customs") classified the subject imports under subheading 8501.10.40 of theHarmonized Tariff Schedule of the United States ("HTSUS") (2007) as electric motors. Belimo contends in its motion for summary judgment that Customs should have classified the subject imports under HTSUS 9032.89.60 as automatic regulating or controlling apparatuses because each incorporates an application specific integrated circuit (ASIC). Defendant United States asserts in its cross-motion that Customs correctly classified the subject imports under HTSUS 8501.

No genuine issues of material fact exist regarding properties of the subject imports and how they operate. Thus, the sole issue before the court is whether, as a matter of law, the subject imports were properly classified under HTSUS 8501 as "electric motors" or whether they should be classified under HTSUS 9032 as "automatic regulating and controlling instruments and apparatus."¹ For the reasons below, the court holds that Customs correctly classified the subject imports as "electric motors" subject to HTSUS 8501 and, therefore, denies Belimo's motion for summary judgment and grants Defendant's cross-motion for summary judgment.

BACKGROUND AND PROCEDURAL HISTORY

A. Overview of the Subject Imports

The subject imports are principally used in HVAC systems, which heat and cool spaces within buildings. (Def.'s Cross Mot. Summ. J. (hereinafter "Def.'s Cross Mot.") 2-3; Pl.'s Statement of Material Facts Not in Issue (hereinafter "Pl.'s Statement of Facts") ¶¶ 12-13.) Each consists of an electric motor, gears, and two printed circuit boards (PCBs), one of which is an ASIC, within a plastic or metal housing unit.² (Def.'s Cross Mot. 2; Pl.'s Statement of Facts ¶9.) The ASIC connects to and monitors the electric motor. (Def.'s Cross Mot. 5-6; Pl.'s Statement of Facts ¶¶ 31-32.) The motor, in turn, connects to and moves the gears. (Def.'s Cross Mot. 7; Pl.'s Statement of Facts ¶ 27.) The gears link the subject imports to an external mechanism that opens or closes a damper or a valve when the gears turn. (Def.'s Cross Mot. 1, 3, 7; Pl.'s Statement of Facts ¶¶ 26, 36, 41; Fairfax Dep. 30:14-25, June 5, 2012; Martinelli Dep. 83:17-22, 84:10-22, June 5, 2012.)

B. Operation of an HVAC System

An HVAC system typically includes sensors that measure the ambient air temperature of spaces in a building. (Def.'s Cross Mot. 3; Pl.'s Statement of Facts ¶ 15; Martinelli Dep. 24:15-24:23.) A central controller³ receives and processes signals from temperature sensors and compares those signals to a pre-set, desired temperature for a given space. (Def.'s Cross Mot. 3; Pl.'s Statement of Facts ¶¶ 14(a)-(f), 16; Fairfax Dep. 108:19-109:2; Martinelli Dep. 24:15-26:4, 29:23-30:5.) The central controller then signals to a motor⁴ to reposition an attached valve to change the amount of heated or cooled water that can flow through a water handling unit that serves that space. (Def.'s Cross Mot. 1-3; Pl.'s Mot. Summ. J. (hereinafter "Pl.'s Mot.") 1-4; Pl.'s Statement of Facts ¶¶ 16-17, 21-23, Fairfax Dep. 30:15-25, 62:18-63:17; Martinelli Dep. 20:4-23:21, 25:20-26:8, 40:3-18.) The temperature of the water in the water handling units affects the air temperature within air handling units that also serve that space. (Def.'s Cross Mot.1-3; Pl.'s Mot. 1-4; Pl.'s Statement of Facts ¶¶ 14b and c, 17-20; Martinelli Dep. 20:4-23:21, 25:20-27:7, 40:3-18.) Meanwhile, the central controller signals to a motor to reposition an attached damper to change the amount of heated or cooled air that can flow through the ductwork into the space that the air handling units serve. (Def.'s Cross Mot. 1-4; Pl.'s Mot. 1-4; Fairfax Dep. 62:7-63:17; Martinelli Dep. 26:25-27:18, 29:23-30:23.)

C. Operation of a Traditional HVAC System as Compared to One that Incorporates the Subject Imports

Compared to traditional HVAC systems, an HVAC system that incorporates the subject imports can more precisely and consistently control the motor used to position dampers or valves. (Def.'s Cross Mot. 4; Fairfax Dep. 30:14-25, 113:2-9.) In a traditional HVAC system, the central controller conveys the position signal directly to the motor, which turns until it triggers a switch that indicates the requested position has been reached. (Def.'s Cross Mot. 5; Martinelli Dep. 32:2-8.) In a system incorporating the subject imports, the central controller sends the position signal to the ASIC, which serves as a sophisticated version of the switch in the traditional HVAC system. (Def.'s Cross Mot. 5; Pl.'s Statement of Facts ¶¶ 29-32; see Martinelli Dep. 29:23-30:23.) The ASIC connects to and monitors the position of the motor.⁵ (Def.'s Cross Mot. 5-6; Pl.'s Statement of Facts ¶¶ 31-32; Pl's Mot. 9.) By monitoring the motor's position, the ASIC can calculate the position of the gears in the subject merchandise, which corresponds to the position of the attached valve or damper. (Def.'s Cross Mot. 7; Pl.'sStatement of Facts ¶¶ 37-38; Martinelli Dep. 29:15-23; Martinelli Affirm ¶¶ 7-8, July 9, 2012 (correcting statements in deposition testimony).) The ASIC compares the calculated gear position with the desired position that it received from the central controller. (Def.'s Cross Mot. 5-6; Pl.'s Statement of Facts ¶ 39; Martinelli Dep. 62:11-63:10; Martinelli Affirm ¶¶ 7-8.) It then calculates the motor operation required to rotate the gears so that the damper or valve will move to the desired position. (Def.'s Cross Mot. 7; Pl.'s Statement of Facts ¶¶ 39-40.) The ASIC then activates the motor, thereby turning the gears in the subject imports and repositioning the damper or valve until it reaches the desired position. (Def.'s Cross Mot. 5-7; Pl.'s Statement of Facts ¶¶ 32-33, 38-40; see Martinelli Dep. 30:6-30:14.)

D. The ASIC's Independent Control Functions

The ASIC also performs certain functions independently. For example, it monitors the subject imports' motor periodically and continuously, even absent a signal from the central controller. (Def.'s Cross Mot. 5-6; Pl.'s Statement of Facts ¶¶ 37, 42; Martinelli Dep. 51:6-19; Martinelli Affirm ¶¶ 5, 7, 10.) Using the inputs from this monitoring, the ASIC can independently prevent and reverse unintended movement from the desired position. (Def.'s Cross Mot. 5-7; Pl.'s Statement of Facts ¶¶ 42, 45.) Additional examples of the ASIC's independent functions include its ability to adapt to receive an AC or DC signal from the controller, filter out unintended electric signals, and use stored energy to prevent the motor from spinning out of control when the power fails. (Def.'s Cross Mot. 1 (accepting statements of fact in Pl.'s Mot. 8-15 unless otherwise noted); Pl.'s Mot. 12-15.)

E. The Subject Imports Do Not Measure or Calculate External Variables

Despite these independent control functions, the subject imports can only monitor the position of the motor and calculate the position of the incorporated gears. (Def.'s Cross Mot. 7;Pl.'s Statement of Facts ¶¶ 31-32, 36-39; Fairfax Dep. 67:2-8, 93:12-25.) The subject imports do not incorporate a temperature sensor, measure temperature or any variable of airflow or of a liquid, or compare such an external measurement to a predetermined value. (Def.'s Cross Mot. 7; Fairfax Dep. 51:6-14, 55:11-56:4; Martinelli Dep. 52:20-53:13, 77:21-78:3.) Instead, the subject imports position their incorporated motor and gears in response to a signal received from the central controller, thereby affecting the position of an attached damper or valve. (Def.'s Cross Mot. 13; Martinelli Dep. 84:10-22, 86:4-87:22.)

F. Procedural History

The subject imports entered the United States between February 9, 2007 and February 26, 2007. Customs liquidated them between December 21, 2007 and January 11, 2008 under HTSUS 8501. Belimo timely filed a protest of this classification decision on June 17, 2008. On September 18, 2009, Customs confirmed that the subject imports fall under HTSUS 8501 as electric motors. HQ H044560 (Sept. 18, 2009). Belimo now challenges the denial of its protest. The parties have fully briefed the issues, and the court now rules on their respective motions for summary judgment.

JURISDICTION AND STANDARD OF REVIEW

The court has subject matter jurisdiction over this case pursuant to 28 U.S.C. § 1581(a). The court may grant summary judgment when "there is no genuine issue as to any material fact." USCIT R. 56(c). Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." USCIT R....