DRI Industries, Inc. v. US, Court No. 84-10-01375.

• Decision Date: 10 February 1987
• Docket Number: Court No. 84-10-01375.
• Citation: 657 F. Supp. 528
• Parties: DRI INDUSTRIES, INC., Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

657 F. Supp. 528

DRI INDUSTRIES, INC., Plaintiff, v. UNITED STATES, Defendant.

Court No. 84-10-01375.

United States Court of International Trade.

February 10, 1987.

Sharretts, Paley, Carter & Blauvelt, P.C., Peter Jay Baskin, New York City, for plaintiff.

Richard K. Willard, Asst. Atty. Gen., Washington, D.C., Joseph I. Liebman, Atty. in Charge, Intern. Trade Field Office, New York City, for defendant.

MEMORANDUM OPINION

CARMAN, Judge:

This action involves the proper classification of an item designated as the tool chest portion of a "Tool Locker" tool chest and cabinet. Plaintiff, DRI INDUSTRIES, INC. (DRI), challenges the United States Customs Service's (Customs) classification of the subject merchandise upon liquidation as "Luggage and handbags ... Of other material ... Other ... Other," under item 706.62, Tariff Schedules of the United States (1983) (TSUS) at 20 percent ad valorem.

This Court concurs with Customs' classification and assessment of duties of the tool chest holding the tool chest was properly classified as luggage under item 706.62, TSUS, and dismisses this action.

BACKGROUND AND FACTS

The merchandise which is the subject of this action consists only of the tool chest portion of an article described as a "Tool Locker" tool chest and cabinet. Although both the chest and cabinet portions were imported by plaintiff DRI into the United States from Taiwan at the same time and in the same shipping package, it is only the classification of the tool chest portion which DRI contests. The tool chest portion, which is "of iron or steel", measures approximately 19 inches wide by 12- 5/8 inches high by 9-½ inches deep, has three pull-out drawers with knobs and a hinged top with a handle, and weighs about sixteen pounds when empty. It was classified by Customs upon liquidation under the provision of item 706.62, TSUS¹.

Plaintiff asserts the tool chest portion is, for tariff purposes, a separate article which should be classified under item A 657.25, TSUS², duty free under the Generalized System of Preferences (GSP) pursuant to General Headnote 3(c), TSUS (1983).

In the event the subject merchandise (tool chest) does not qualify under the GSP, plaintiff alternatively contends the tool chest should still be classified under item 657.25, TSUS³, at 7.6 percent ad valorem. Customs has conceded the subject merchandise is entitled to duty free entrance if the Court holds it is properly classifiable under a TSUS provision which is eligible for the G.S.P. treatment.

In the event the tool chest is held not to be classifiable under the provisions of tariff item 657.25, TSUS, plaintiff, in the second alternative, claims the tool chest is properly classifiable as an entirety with the cabinet portion under item 727.55, TSUS⁴, at 7 percent ad valorem.

DRI, nevertheless, explicitly stated in its post trial brief it did "not herein press its alternative classification claim that the subject article is for tariff purposes an entirety with the imported cabinet portion, and is therefore classifiable as `furniture.'" Plaintiff's brief at 2.

Customs seeks dismissal of the action contending the Government's classification and assessment of duties is correct.

DISCUSSION

The question in this case is whether or not the tool chest was intended by Congress to be classified under the provision of item 706.62, TSUS, at a duty rate of 20 per cent ad valorem. The issues presented by the parties center around whether the tool chest is "luggage" under item 706.62, TSUS, as defined in TSUS Schedule 7, Part 1, Subpart D, headnote 2(a)(ii), which states:

2. For the purposes of the tariff schedules — (a) the term "luggage" covers —

* * * * * *

(ii) brief cases, portfolios, school bags, photographic equipment bags, golf bags, camera cases, binocular cases, gun cases, occupational luggage cases (physicians', sample, etc.), and like containers and cases designed to be carried with the person, except handbags as defined herein;

Customs presented exhibits at trial which were representative literature used to depict and describe the tool chest and cabinet for purposes of advertising the merchandise for the retail or wholesale markets. Examination of those exhibits reveals the tool chest is depicted and described as a "separate unit" from the cabinet. The tool chest is described as a "Heavy-Duty, Carry-Along, Three-Drawer Tool Chest" which you "can carry-along wherever you need it." The tool chest is promoted as "a totally professional way to securely store and conveniently transport your tools and supplies." The tool chest is "portable" and "will go right to the work site." The "Double Slider Safety Drawers lock-in automatically" which "makes transporting easy...." The literature also displayed pictures of various people using the tool chest, one of which depicted a man kneeling by a water heater with the tool chest on the floor by his side.

DRI presented expert testimony of four witnesses: a plumber, an electrician, an executive of DRI, and a buyer for a large retail chain store, who all agreed the primary purpose of the tool chest and cabinet was for the storing and organizing of tools. Some of these witnesses also testified the tool chest had the capability of being portable. One of these witnesses, the chief executive officer and owner of DRI, testified the tool chest could be transported from place to place but only on a limited basis, i.e., within the house, from one house to another, and from one place to a distant place when taken in an automobile.

Customs' sole expert witness was vice-president of a business which has manufactured and sold metal products, primarily tool boxes and chests, since 1947. He testified his business manufactures a tool chest similar to the tool chest in question. His opinion was the primary purpose of any tool box is to store and organize tools, but his company's tool chest, as is true of DRI's, is designed to be carried and transported from place to place.

The actual tool chest and cabinet, which is the subject of this action, was placed in evidence and thoroughly examined by this Court.

The Court notes at the outset of this discussion:

A presumption of correctness attaches to a classification by the Customs Service, and the importer has the burden of proving that the classification is incorrect.... To give effect to this presumption the courts have long imposed a "dual burden" of proof: the importer must prove not only that the government's classification is incorrect but also that the importer's proposed classification is correct.

* * * * * *

But the trial court cannot determine the correct result simply by dismissing the importer's alternative as incorrect. It must consider whether the government's classification is correct, both independently and in comparison with the importer's alternative.

Jarvis Clark Co. v. United States, 733 F.2d 873, 876, 878 (Fed.Cir.1984) (citations and footnote omitted); see 28 U.S.C. § 2639(a)(1) (1986).

DRI's main contentions are the primary purpose of the tool chest as supported by testimony, is to organize and store tools, and this "primary design and function controls the classification" of the tool chest. DRI states:

The subject tool chests are not luggage as set forth in headnote 2(a) because they were designed primarily for a purpose other than to be carried with a person; ... they were not designed to be used during the type of travel contemplated by the tariff provisions covering luggage.

Plaintiff's Reply Brief at 3. "There is no indication given by the statutory language, or found in prior case law, that an article would qualify as luggage merely by fulfilling the minimum requirement of having been designed for or capable of being carried around...." Plaintiff's Brief at 50. On the contrary, DRI argues, "an examination of the statutory exemplars, and the rules of ejusdem generis⁵ demonstrates the sort of travel intended by Congress." Id. at 51.

Customs basically argues headnote 2(a)(ii) does not have travel as a primary use for those items included within the scope of the definition of "luggage". Unlike headnote 2(a)(i) which does deal with travel, "2(a)(ii) is not qualified by requirements that the primary or chief use or design of the articles embraced there be for travel." Defendant's Brief at 18. The exemplars listed in 2(a)(ii) are containers designed for storage, protection, and organization of their respective contents with the additional requirement other articles, to be included but not listed, be "like containers and cases designed to be carried with the person." 2(a)(ii). No intent of Congress for a travel requirement, as stated in 2(a)(i), is provided therein. Customs maintains, under the doctrine of ejusdem generis, the tool chest is a portable container or case "like" those exemplars listed in 2(a)(ii) because they all retain a common characteristic of being designed to hold or store specific items and are all designed to be carried with a person.

Where the issues involved concern

statutory construction "our starting point must be the language employed by Congress," Reiter v. Sonotone Corp., 442 U.S. 330, 337, 99 S.Ct. 2326, 2330, 60 L.Ed.2d 931 (1979), and we assume "that the legislative purpose is expressed by the ordinary meaning of the words used." Richards v. United States, 369 U.S. 1, 9 82 S.Ct. 585, 591, 7 L.Ed.2d 492 (1962). Thus "absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive." Consumer Product Safety Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 108 100 S.Ct. 2051, 2056, 64 L.Ed.2d 766 (1980).

American Tobacco Co. v. Patterson, 456 U.S. 63, 68, 102 S.Ct. 1534, 1537, 71 L.Ed.2d 748 (1982); see Izod Outerwear, Slip Op. 85-72 at 3.

Where the statutory language is unclear, rules of statutory construction are useful for interpretation. Of utmost concern in these situations is the legislative intent. Any rule of construction resulting in an...