Citizen Watch Co. Of America Inc. v. United States

• Decision Date: 18 August 2010
• Docket Number: Court No. 04-00220.,Slip Op. 10-94.
• Citation: 724 F.Supp.2d 1316
• Parties: CITIZEN WATCH CO. OF AMERICA, INC., Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

724 F.Supp.2d 1316

CITIZEN WATCH CO. OF AMERICA, INC., Plaintiff,

v.UNITED STATES, Defendant.

Slip Op. 10-94.

Court No. 04-00220.

United States Court of International Trade.

Aug. 18, 2010.

COPYRIGHT MATERIAL OMITTED.

Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, New York, NY (Erik D. Smithweiss, Frances P. Hadfield, Heather C. Litman, Robert F. Seely, Joseph M. Spraragen, and Robert B. Silverman) for the plaintiff.

Tony West, Assistant Attorney General; Barbara S. Williams, Attorney in Charge, International Trade Field Office, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Marcella Powell and Aimee Lee); Chi S. Choy, Office of the Assistant Chief Counsel, International Trade Litigation, U.S. Customs and Border Protection, of counsel, for the defendant.

OPINION

RESTANI, Chief Judge.

This matter is before the court on cross-motions for summary judgment by plaintiff Citizen Watch Co. of America, Inc. (“Citizen”) and defendant United States (“the Government”) pursuant to USCIT Rule 56. Citizen challenges the tariff classification of its imported watch boxes. U.S. Customs and Border Protection (“Customs”) classified the merchandise under subheading 4202.99.90 of the Harmonized Tariff Schedule of the United States (“HTSUS”), which provides for jewelry boxes and similar containers. ¹ Citizen asserts that the proper classification is under subheading 4819.50.40, HTSUS as packing containers. ² For the reasons below, the court concludes that Citizen is correct and thus grants Citizen's motion for summary judgment and denies the Government's cross-motion for summary judgment.

BACKGROUND

Between 2001 and 2003, Citizen imported the merchandise at issue, four models of boxes manufactured in China and Thailand, at the Port of Los Angeles. Def.'s Statement Undisputed Material Facts (“Def.'s SMF”) ¶ 1; Pl.'s Objs. & Resps. Def.'s Statement Undisputed Facts (“Pl.'s Resp. SMF”) ¶ 1; Pl.'s Resp. Def.'s First Interrogs. & Req. Produc. Docs., available at

Mem. Supp. Def.'s Cross Mot. Summ. J. & Opp'n Pl.'s Mot. Summ. J. (“Def.'s Br.”) Ex. J, at 4. Each box is specially fitted to hold a single watch. Def.'s SMF ¶ 6; Pl.'s Resp. SMF ¶ 6. The boxes are made of non-corrugated cardboard with a core thickness of 2 mm and an insert thickness of 1.2 mm, uncoated ribbed paper weighing 110 grams per square meter, flocked paper weighing 60 grams per square meter, and white glue. Pl.'s Statement Material Facts (“Pl.'s SMF”) ¶¶ 9-10; Def.'s Resp. Pl's Statement Undisputed Facts (“Def.'s Resp. SMF”) ¶¶ 9-10; Fuller Decl. ¶ 4. They consist of a removable lid and a base. Fuller Decl. ¶ 4. Each box contains a bendable metal collar on which a watch can be placed. Def.'s SMF ¶¶ 19-20; Pl.'s Resp. SMF ¶¶ 19-20; Fuller Decl. ¶ 6. The collar consists of a metal band of 0.5 mm thickness that is glued or laminated to flocked paper. Pl.'s SMF ¶¶ 9-10; Def.'s Resp. SMF ¶¶ 9-10; Def.'s SMF ¶ 18; Pl.'s Resp. SMF ¶ 18. The boxes are cylindrical in shape, and the insides of the boxes are angled. Def.'s SMF ¶¶ 21-22; Pl.'s Resp. SMF ¶¶ 21-22. A recycling symbol is stamped onto each box. Pl.'s SMF ¶ 22; Def.'s Resp. SMF ¶ 22. The undisputed evidence indicates that each box is capable of between ten and fifty applications, or cycles of opening the box and removing a watch and then replacing the watch and closing the box, as the Government's counsel confirmed at oral argument. See Singh Aff. ¶ 14, available at Corrected Reply Mem. Further Supp. Def.'s Cross Mot. Summ. J. (“Def.'s Reply Br.”) Ex. P; Singh Dep. 113:12-20, Sept. 23, 2008, available at Pl.'s Mem. Law Opp'n Def.'s Cross-Mot. Summ. J. (“Pl.'s Reply Br.”) Ex. A; Pl.'s Resp. SMF ¶ 11.

Customs classified and liquidated the merchandise under heading 4202, HTSUS. Pl.'s SMF ¶ 4; Def.'s Resp. SMF ¶ 4. Citizen timely filed protests, which Customs denied. ³ See Pl.'s SMF ¶ 2; Def.'s Resp. SMF ¶ 2. In May 2004, Citizen commenced the present action. Both parties now move for summary judgment pursuant to USCIT Rule 56.

JURISDICTION AND STANDARD OF REVIEW

The court has jurisdiction pursuant to 28 U.S.C. § 1581(a). Summary judgment is appropriate if “there is no genuine issue as to any material fact,” and “the movant is entitled to judgment as a matter of law.” USCIT R. 56(c). The proper construction of a tariff provision is a question of law, and whether the imported merchandise falls within a particular tariff provision is a question of fact. Franklin v. United States, 289 F.3d 753, 757 (Fed.Cir.2002). The court decides both questions de novo. See 28 U.S.C. § 2640(a)(1); Metchem, Inc. v. United States, 441 F.Supp.2d 1269, 1271 (CIT 2006). Although Customs' classification decision “is presumed to be correct,” 28 U.S.C. § 2639(a)(1), this presumption attaches only to factual determinations, Universal Elecs. Inc. v. United States, 112 F.3d 488, 492 (Fed.Cir.1997).

DISCUSSION

The General Rules of Interpretation (“GRIs”) of the HTSUS direct the proper classification of merchandise entering the United States. Orlando Food Corp. v. United States, 140 F.3d 1437, 1439 (Fed.Cir.1998). Under GRI 1, HTSUS, “classification shall be determined according to the terms of the headings and any relative section or chapter notes.” The terms “are construed according to their common and commercial meanings.” Len-Ron Mfg. Co. v. United States, 334 F.3d 1304, 1309 (Fed.Cir.2003). Note 2(h) to Chapter 48 of the HTSUS provides that the chapter “does not cover ... [a]rticles of heading 4202 (for example, travel goods).” ⁴ Accordingly, the court considers whether the watch boxes are classifiable under heading 4202 before considering whether they are classifiable under heading 4819.

I. Heading 4202 A. Watch boxes may be containers similar to jewelry boxes under heading 4202.

Heading 4202, HTSUS consists of a list of exemplars, including “jewelry boxes,” followed by the general phrase “similar containers.” Here, Customs classified the imported watch boxes as “jewelry boxes and similar containers.” HQ 966321 (Nov. 21, 2003), available at 2003 WL 23303771, at * 1, 5. The Government now contends that the watch boxes are “covered by the tariff term ‘similar containers' in heading 4202” under the doctrine of ejusdem generis and argues in the alternative that the imported watch boxes are “jewelry boxes” under heading 4202. Def.'s Br. 2, 6-20. The court determines that watch boxes that fall within heading 4202 are most precisely classified as containers similar to jewelry boxes because watches are not necessarily jewelry. Compare Chapter 71, HTSUS (covering jewelry) with Chapter 91, HTSUS (covering watches); see also HQ 951028 (Mar. 3, 1993), available at 1993 WL 126634, at *3 (stating that because jewelry presentation cases are “jewelry boxes,” “cases used in the presentation and sale of other articles are ‘similar containers' as that phrase appears in” heading 4202). This distinction, however, does not affect the requirements the watch boxes must satisfy to be classifiable under heading 4202.

B. Any item classifiable under heading 4202 must be suitable for long-term or prolonged use.

Where, as in heading 4202, “a list of items is followed by a general word or phrase, the rule of ejusdem generis is used to determine the scope of the general word or phrase.” Aves. In Leather, Inc. v. United States, 423 F.3d 1326, 1332 (Fed.Cir.2005). Under that rule, “the general word or phrase is held to refer to things of the same kind as those specified.” Sports Graphics, Inc. v. United States, 24 F.3d 1390, 1392 (Fed.Cir.1994). “In classification cases, ejusdem generis requires that, for any imported merchandise to fall within the scope of the general term or phrase, the merchandise must possess the same essential characteristics or purposes that unite the listed exemplars preceding the general term or phrase.” Aves. In Leather, 423 F.3d at 1332.

The U.S. Court of Appeals for the Federal Circuit has held that the essential characteristics or purposes of the exemplars in heading 4202 consist of “organizing, storing, protecting, and carrying various items.” Id. (internal quotation marks and citation omitted). According to the Government, the watch boxes are “similar containers” simply because they may organize, store, protect, and carry watches. Def.'s Br. 6-12. As each watch box is designed to hold a single watch, the watch boxes can organize and store watches, at least for the short term. See Leavey Dep. 22:16-25, June 25, 2008, available at Def.'s Br. Ex. C. Citizen admits that the watch boxes can protect and carry watches. Pl.'s Resp. SMF ¶¶ 4, 7; see Def.'s SMF ¶¶ 4, 7. Citizen, however, contends that organizing, storing, protecting, and carrying are also characteristics of containers classifiable under heading 4819 and are not determinative in this case. Pl.'s Reply Br. 7-9. Citizen is correct.

Another essential, and here determinative, characteristic of the exemplars in heading 4202 is suitability for long-term or prolonged use. See Aves. In Leather, 423 F.3d at 1332-33 (affirming this Court's determination that a folio that was not sufficiently durable to hold personal items for any extended period did not have the essential characteristics of a container classifiable under heading 4202); see also Chapter 42 Note 2(A)(a), HTSUS (providing that heading 4202 does not cover “[b]ags made of sheeting of plastics ... with handles, not designed for prolonged use”); World Customs Organization, Harmonized Commodity Description & Coding System Explanatory Notes, Explanatory Note 42.02, 792 (3d ed. 2002) (“Explanatory Note(s)”) (providing that heading 4202 does not cover “[s]hopping bags ... not designed for prolonged use”). ⁵ As this Court has observed, the exemplars in heading 4202 “are all intended for reuse,” and “[s]uitcases, briefcases, cigarette cases, musical instrument cases, and all the others listed therein are items which are used repeatedly.” Jewelpak Corp. v. United States, 97 F.Supp.2d...