Boen Hardwood Flooring, Inc. v. U.S.

• Decision Date: 25 February 2002
• Docket Number: SLIP OP. 02-21.,Court No. 96-08-02006.
• Citation: 196 F.Supp.2d 1331
• Parties: BOEN HARDWOOD FLOORING, INC., Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

196 F.Supp.2d 1331

BOEN HARDWOOD FLOORING, INC., Plaintiff, v. UNITED STATES, Defendant.

SLIP OP. 02-21.

Court No. 96-08-02006.

United States Court of International Trade.

February 25, 2002.

COPYRIGHT MATERIAL OMITTED

Galvin & Mlawski, New York City (John J. Galvin), for Plaintiff.

Robert D. McCallum, Jr., Assistant Attorney General, John J. Mahon, Acting Attorney in Charge, International Trade Field Office, Barbara S. Williams, Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice Yelena Slepak, Office of Assistant Chief Counsel, International Trade Litigation, U.S. Customs Service, Of Counsel, Washington, DC, for Defendant.

OPINION

POGUE, Judge.

Plaintiff Boen Hardwood Flooring, Inc. ("Plaintiff" or "Boen") challenges the denial of its protest, filed in accordance with section 514 of the Tariff Act of 1930, as amended, 19 U.S.C. § 1514 (1994), against the liquidation of the subject merchandise.¹ Defendant United States Customs Service ("Defendant" or "Customs") classified Plaintiff's merchandise under heading 4412 of the Harmonized Tariff Schedule of the United States (1995) ("HTSUS"), as "[p]lywood, veneered panels, and similar laminated wood." Plaintiff contends that the subject merchandise should be liquidated under subheading 4409.20.25, HTSUS, as "[n]onconiferous [w]ood flooring." See Pl.'s Statement of Material Facts Not in Issue at 2 ("Pl.'s Statement of Facts").

Jurisdiction lies under 28 U.S.C. § 1581(a) (1994). Customs' classification is subject to de novo review by this Court pursuant to 28 U.S.C. § 2640 (1994). This action is before the Court on cross motions for summary judgment made by Plaintiff and Defendant pursuant to USCIT Rule 56. The Court finds, for the reasons discussed below, that the subject merchandise is properly classified under heading 4412, HTSUS, as a "veneered panel" and grants summary judgment for the defendant.

Undisputed Facts

The subject merchandise consists of hardwood flooring made up of three layers of wood in which the grain of the middle layer is perpendicular to the grain of the two outer layers. See Pl.'s Statement of Facts at 4-5; Def.'s Resp. to Pl.'s Statement of Material Facts ¶¶ 18-21 ("Def.'s Resp. to Pl.'s Statement of Facts"). The three layers of the flooring are glued together. See Def.'s Statement of Undisputed Facts ¶ 3; Pl.'s Statement of Facts at 6. Without acknowledging it by explicit agreement, both parties to this action do agree that the subject merchandise has been "laminated."² See Pl.'s Statement of Facts at 6 (stating that the layered stock from which the merchandise is produced is "glu[ed] under pressure"); Def.'s Statement of Undisputed Facts ¶ 3 (stating that the top and bottom layers of the flooring are glued to the middle layer); Def.'s Mem. Supp. Cross Mot. Summ. J. and Opp'n Pl.'s Mot. Summ. J. at 14-15 ("Def.'s Mem.") (arguing that the merchandise meets the definition of "laminated" and therefore is properly classifiable as "similar laminated wood"), 18 (arguing that the subject merchandise is "highly processed ... by lamination"); see also Dep. of Thomas L. Goss at 29 (stating that a hydraulic press is used to "put[] pressure and heat down on the [flooring layers] to press [them] together and to get the glue to bond"); Boen Marketing Material, Transform Your World with Boen Hardwood, Collective Ex. A at Specification Suggestions—Materials (stating that "Boen Longstrip shall be laminated construction"); Boen Hardwood Flooring Floating Floor System Installation Guide, Def.'s Ex. 1, (describing the merchandise as "three ply laminate").

The flooring is continuously shaped with tongue and groove along its edges and ends, see Pl.'s Statement of Facts at 7; Def.'s Mem. at 2, and comes in a standard size of 5½ inches wide, 7 feet 25/8 inches long, and approximately 5/8 inch thick.³ See Pl.'s Statement of Facts at 4; Def.'s Resp. to Pl.'s Statement of Facts ¶ 17. The top layer of the flooring is composed of strips of hardwood measuring approximately 1/8 inch thick and 2¾ inches wide. See Pl.'s Statement of Facts at 5; Def.'s Resp. to Pl.'s Statement of Facts ¶ 21. The center layer is composed of softwood⁴ strips or slats measuring approximately one inch wide and 1/4 inch thick.⁵ These softwood strips are laid next to each other with their grain perpendicular to the grain of the two outer layers of the flooring. See Pl.'s Statement of Facts at 5; Def.'s Resp. to Pl.'s Statement of Facts ¶ 20. The bottom layer of the flooring is composed of spruce strips, 1/8 inch thick and 2¼ to 2¾ inches wide. See Pl.'s Statement of Facts at 4; Def.'s Resp. to Pl.'s Statement of Facts ¶ 19. The grain of the spruce pieces is perpendicular to the grain of the softwood center layer and parallel to the grain of the top hardwood layer. See Pl.'s Statement of Facts at 5; Def.'s Resp. to Pl.'s Statement of Facts ¶ 20.

Parties' Arguments

Plaintiff argues that the imported hardwood flooring in question should be classified within heading 4409, HTSUS, "[w]ood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V-jointed, beaded, molded, rounded or the like) along any of its edges or faces, whether or not planed, sanded or finger-jointed," and further, under subheading 4409.20.25, HTSUS, "[n]onconiferous [w]ood flooring." Plaintiff contends that the subject merchandise is properly classifiable under heading 4409, HTSUS, because under prior tariff acts, both wooden flooring and laminated wood, when produced in dimensions found in nature, were classified as lumber products not further manufactured than sawed, planed, tongued, and grooved, rather than as more advanced items. See Pl.'s Mem. at 14. Plaintiff asserts that the subject merchandise is not classifiable as plywood, veneered panels, or laminated wood because it does not meet the definitions of these items. See Pl.'s Reply to Def.'s Resp. Opp'n Pl.'s Mot. Summ. J. and Resp. Opp'n Def.'s Cross Mot. Summ. J. at 4-13 ("Pl.'s Reply"). Further, Plaintiff argues that even if the subject merchandise were "[p]lywood, veneered panels, or similar laminated wood," it would have the essential character of an item of heading 4409, HTSUS, and be classifiable thereunder according to the Harmonized Commodity Description and Coding System Explanatory Notes (1st ed. 1986) ("Explanatory Notes") for heading 4412, HTSUS. See Pl.'s Reply at 13-18.

Defendant asserts that the flooring is properly classified under heading 4412, HTSUS, which describes "[p]lywood, veneered panels, or similar laminated wood," and argues that the flooring meets the definition of plywood. Defendant argues in the alternative that even if the flooring were not classifiable as plywood it still fits the definitions of "veneered panels" and "similar laminated wood." Def.'s Mem. at 5. Defendant asserts that the flooring is excluded from heading 4409, HTSUS, by the terms of the headings and the Explanatory Notes, id. at 15-17; that cases decided under the TSUS and earlier Tariff Acts are not controlling due to the change in statutory language and legislative intent, id. at 18-20; and that the cases do not support the classification of the subject merchandise under heading 4409, HTSUS. Id. at 21-26.

Standard of Review

Summary judgment is appropriate where there exists no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. See USCIT Rule 56(d); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). A dispute is genuine "if the evidence is such that [the trier of fact] could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248, 106 S.Ct. 2505.

The Court employs a two-step process in analyzing a customs classification. "[F]irst, [it] construe[s] the relevant classification headings; and second, [it] determine[s] under which of the properly construed tariff terms the merchandise at issue falls." Bausch & Lomb, Inc. v. United States, 148 F.3d 1363, 1365 (Fed.Cir. 1998) (citing Universal Elecs., Inc. v. United States, 112 F.3d 488, 491 (Fed.Cir. 1997)). Interpretation of the tariff classification terms is a question of law, while application of the terms to the merchandise at issue is a question of fact. See id. Summary judgment is appropriate when the dispute involves only the proper tariff classification for the subject merchandise, not the nature of the merchandise itself. See id. Where there is a dispute about the nature of the subject merchandise, there exists a genuine issue of material fact and a trial is warranted.

In the instant case, the parties agree that the subject merchandise is flooring consisting of a hardwood layer and two softwood layers, glued together with the grains of the pieces forming the center layer laid perpendicular to the grains of the pieces forming the two outer layers. As the parties agree to the essential nature and material characteristics⁶ of the merchandise, and disagree only as to its proper classification under the HTSUS, summary judgment of the classification issue is appropriate.

Discussion

The HTSUS consists of (1) the General Notes; (2) the General Rules of Interpretation ("GRI"); (3) the Additional U.S. Rules of Interpretation; (4) sections I through XXII (encompassing chapters 1 through 99, including all section and chapter notes, article provisions, and tariff and other treatment accorded thereto); and (5) the Chemical Appendix. Classification of goods under the HTSUS is governed by the General Rules of Interpretation ("GRI"). See Carl Zeiss, Inc. v. United States, 195 F.3d 1375, 1379 (Fed.Cir.1999); Orlando Food Corp. v. United States, 140 F.3d 1437, 1439 (Fed.Cir.1998). GRI 1 states that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes." GRI 1; ...