Deckers Corp. v. U.S.

• Decision Date: 15 December 2005
• Docket Number: Slip Op. 05-159. Court No. 02-00674.
• Citation: 414 F.Supp.2d 1252
• Parties: DECKERS CORPORATION, Plaintiff, v. THE UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

414 F.Supp.2d 1252

DECKERS CORPORATION, Plaintiff, v. THE UNITED STATES, Defendant.

Slip Op. 05-159. Court No. 02-00674.

United States Court of International Trade.

December 15, 2005.

Rode & Qualey, New York City (Patrick D. Gill, Michael S. O'Rourke and William J. Maloney) for the plaintiff.

Peter D. Keisler, Assistant Attorney General; Barbara S. Williams, Attorney in Charge, International Trade Field Office, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (James A. Curley); and Office of Assistant Chief Counsel, U.S. Customs and Border Protection (Michael W. Heydrich), for the defendant, of counsel.

Memorandum & Order

AQUILINO, Senior Judge.

In Hebrew, Teva means Nature. In American, it can mean sandals under patent that have been produced in Hong Kong for import here, the tariff classification of three models of which, the Pretty Rugged Sport Sandal, the Terraclactyl Sport Sandal, and the Aquadactyl Sport Sandal, is the basis of this test case within the meaning of USCIT Rule 84(b). Upon entry of those particular Teva®s through the port of Los Angeles, California, the U.S. Customs Service, as it was then still known, classified them under heading 6404 (footwear with outer soles of rubber or plastics and uppers of textile materials) of the Harmonized Tariff Schedule of the United States ("HTSUS") (1998), in particular subheading 6404.19.35 at a rate of duty of 37.5 percent ad valorem. The plaintiff protested that classification, taking the position that those sandals should have been classified under subheading 6404.11.80, which prescribed a duty of 20 percent ad valorem plus 90c per pair valued over $6.50 but not over $12. Customs denied the protest, and this case commenced.

I

The court's jurisdiction is pursuant to 28 U.S.C. §§ 1581(a), 2631(a). The gravamen of plaintiffs complaint is that its merchandise is "athletic footwear", which is sold as such "for sporting and athletic purposes including, but not limited to, whitewater river rafting". Complaint, para. SEVENTEENTH. Following the filing of defendant's answer and the completion of discovery, counsel for the plaintiff filed a formal request for trial in the federal courthouse in Santa Barbara, California,¹ which apparently is located near its corporate headquarters and possible witnesses. The defendant objected to that request, in part upon the stated ground that

[w]hether Customs correctly interpreted subheading 6404.11.80, HTSUS, to require that the imported sandals be ejusdem generis with the named exemplars is a question of law. As such, there is no genuine issue of material fact in dispute as to that question, which can be decided on summary judgment. Moreover, the thrust of the plaintiffs complaint rests on the meaning of the competing tariff provisions.... If the Court decides on summary judgment that the imported sandals are not ejusdem generis with the named exemplars, then there is no need for a trial.

Defendant's Opposition to the Plaintiffs Request for Trial, pp. 4-5 (citation and footnote omitted).

Upon hearing both sides with regard to this opposition, the court granted the defendant leave first to interpose a motion for summary judgment on the issues that it claims are diapositive of this test case. As posited in such motion subsequently filed, they are:

1. Whether ... Customs ... correctly classified the imported sandals under subheading 6404.19.35, HTSUS, as "footwear with open toes or open heels," etc.

2. Whether the imported sandals should have been classified tinder subheading 6404.11.80, HTSUS, as "tennis shoes, basketball shoes, gym shoes, training shoes and the like" etc., as contended by the plaintiff.

Defendant's Brief, p. 1. Plaintiffs papers in opposition formulate the questions as follows:

1. Whether the term "tennis shoes, basketball shoes, gym shoes, training shoes and the like" in subheading 6404.11 covers all athletic footwear (other than sports footwear as defined in subheading Note 1 to Chapter 64).

2. Whether the term "athletic footwear" in Additional U.S. Note 2 to Chapter 64 is an eo nomine provision which includes all forms of athletic footwear.

3. Whether there are genuine issues of material fact as to whether the imported merchandise is within the common meaning of the term "athletic footwear."

Plaintiff's Brief, p. 2. The last question presented is a reflection of plaintiffs continuing opposition to resolution of this action without trial viz.:

... In this instance defendant "bears the burden of demonstrating the absence of all genuine issues of material fact." Avia Group Int'l. Inc. v. L.A. Gear California, Inc., 853 F.2d 1557, 1560 (Fed.Cir.1988). Plaintiff has identified ... numerous material issues concerning "facts that might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Because this action puts into issue the use, characteristics or properties of the merchandise being classified, summary judgment is not warranted. See, Brother Inn. Corp. v. United States, 248 F.Supp.2d 1224, 1226 (CIT 2002).

Id. at 1-2.

II

As required by USCIT Rule 56(h), defendant's motion includes a separate, short and concise statement of the material facts as to which it contends there is no genuine issue to be tried, to wit:

1. The plaintiff imported sandals ... in Entry No. 275-0139524-1 ... [, which] was liquidated ... under subheading 6404.19.35, ... HTSUS.... The plaintiff filed Protest No. 2704-99-100787 with ... Customs ..., claiming that the entry should have been classified under subheading 6404.11.80, HTSUS....

2.... Customs denied that part of Protest No. 2704-99-100787 directed to the plaintiffs claim to classification of the imported sandals under subheading 6404.11.80 HTSUS ... based on HQ 963395 ruling, which issued on April 2, 2002....

3. The imported merchandise in issue consists of three styles ... [that] are shown in the plaintiffs catalog, which is entitled "Teva Footwear and Apparel Spring 2000." The Pretty Rugged sandal is shown on page 9 ..., the Terradactyl sandal is shown on pages 8 and 9 ..., and the Aquadactyl sandal is shown on page 6.... Copies of these pages ... are included in Defendant's Exhibit A....

4. The sandals in issue[ ] have uppers composed of textile materials and soles composed of rubber or plastics.... The front or toe end of each sandal's upper consists of two flat, looped, textile straps that are joined together by a plastic ring. The longer of the two looped straps is adjustable and secures with a hook and loop fabric closure. The straps are attached to the sandal's foot bed to anchor the strap at two points. The rear or heel end of each upper consists of two flat, looped, textile side posts which are attached to the sandal's foot bed. Each post is joined by a plastic ring to adjustable ankle straps which secure with hook and loop fabric closures at the front and back of the ankle. The front straps are connected to the rear straps by a flat looped strap of textile material. The sandals are open at the toe, heel, top and sides....

5. The sandals in issue do not have, or have provision for, the attachment of spikes, sprigs, cleats, stops, clips, bars or the like...,

Citations omitted. Rule 56(h) provides that all material facts in the statement required to be served by the moving party will be deemed admitted unless controverted by the statement required to be served by the opposing party. Plaintiffs response is set forth in Section III B of its brief under the heading: "Plaintiff Does Not Agree that Most of Defendant's Numbered Statements of Material Facts Are Not At Issue." It makes no reference to defendant's paragraph 5, which is thus deemed admitted. Cf. Plaintiffs Brief, p. 11; Subheading Note 1, ch. 64, HTSUS. As for the four other paragraphs, plaintiffs response is not in keeping with the expectation of that rule or of this court.

Be that as it is, plaintiffs position is and has been clear: it desires a trial in order to attempt to prove its own Statement of Genuine Material Facts Which Are at Issue,² to wit:

1. The merchandise in question is "athletic footwear" as provided for in Additional U.S. Note 2 to Chapter 64.

2. The imported merchandise is sold as athletic footwear.

3. Merchandise in issue is used for sporting and athletic purposes including, but not limited to, whitewater rafting.

4. The imported merchandise is sold under the registered trademark Teva® and is patented in the United States Patent Office (Patent # 4,793,075), described as "SPORT SANDAL FOR ACTIVE WEAR."

5. Teva® sport sandals are conducive to fast footwork associated with athletic activities.

6. The imported footwear is the type commonly referred to by the footwear industry and consumers as sport sandals or athletic sandals.

7. Sport sandals are recognized as athletic footwear by the footwear industry.

See also Plaintiffs Brief, pp. 17-24.

Defendant's Response to Plaintiffs Statement of Material Facts at Issue, attached to its reply brief,³ denies these averments. See also Defendant's Brief in Reply, pp. 15-19. That brief argues that, even assuming arguendo that the allegations in paragraphs 2-7 are true, the sandals at' bar still are not athletic footwear for tariff purposes because they are not tennis shoes, basketball shoes, gym shoes, training shoes, `or like those shoes. See id. at 17-19. Whatever the precise formulation of the issue(s), the court cannot conclude that resolution thereof can be achieved without trial of any of plaintiffs averments of fact.

A

The physical appearance of the merchandise cannot be disputed. In its complaint, the plaintiff points to U.S. Patent Number 4,793,075, an abstract of which states:

A sandal with an elongated sole configured to the profile of a human footprint with a toe end and a heel end, employs a toe strap connected at two anchor points to grip the forward part of [a] user's foot and a heel strap...