Hafele America Co., Ltd. v. US

• Decision Date: 12 December 1994
• Docket Number: Court No. 92-11-00761.
• Citation: 870 F. Supp. 352
• Parties: HAFELE AMERICA CO., LTD., Plaintiff, v. The UNITED STATES of America, Defendant.
• Court: U.S. Court of International Trade

870 F. Supp. 352

HAFELE AMERICA CO., LTD., Plaintiff, v. The UNITED STATES of America, Defendant.

Court No. 92-11-00761.

United States Court of International Trade.

December 12, 1994.

Sandler, Travis & Rosenberg, P.A., Edward M. Joffe and Arthur K. Purcell, Miami, FL, for plaintiff.

Frank W. Hunger, Asst. Atty. Gen., Joseph I. Liebman, Attorney-in-Charge, Intern. Trade Field Office, Commercial Litigation Branch, Civ. Div., U.S. Dept. of Justice, James A. Curley, Office of the Asst. Chief Counsel, International Trade Litigation, U.S. Customs Service, Washington, DC, Karen P. Binder, New York City, of counsel, for defendant.

MEMORANDUM and ORDER

GOLDBERG, Judge:

This matter comes before the Court on plaintiff's motion for summary judgment and to dismiss defendant's counterclaim. Defendant opposes plaintiff's motion, asserting that a material issue of fact precludes summary judgment. The Court exercises its jurisdiction pursuant to 28 U.S.C. § 1581(a) (1988).

BACKGROUND

This case involves the proper tariff classification of a small metal rod which serves as part of a two-component system used to join wooden panels together at an angle. The parties do not dispute the material facts which follow.

The cylindrical rod has a threaded foot, a wider unthreaded shank, a thin neck, and a round head with a flat, slotted top. In order to anchor the rod in place, the foot of the rod is screwed into one wooden panel. The unthreaded shank, neck, and head of the rod remain exposed. The exposed portion of the rod is then placed entirely into a pre-drilled hole on the side of a second wooden panel, creating an angle between the two panels. The head fits entirely into a small drum-shaped cam secured at the end of the hole in the second panel. The cam is torqued around the head of the rod to join and lock the two panels together.

The subject merchandise entered this country from Germany between November 26, 1990 and June 12, 1992. Customs liquidated certain entries of the merchandise as screws, under subheading 7318.15.80, Harmonized Tariff Schedule of the United States ("HTSUS"), with a duty rate of 9.5% ad valorem. Plaintiff timely protested the liquidation of the entries of the merchandise as screws, but Customs denied plaintiff's protests. Plaintiff then brought suit in this Court, alleging that Customs had erred in classifying the merchandise as screws. Customs counterclaimed, alleging that some entries of the merchandise, which it had not previously classified as screws, should be so classified.

Plaintiff now moves for summary judgment and dismissal of defendant's counterclaim. Plaintiff primarily argues that the merchandise should be classified as bolts, under HTSUS subheading 7318.15.20, with a duty rate of 0.7% ad valorem. In the alternative, plaintiff claims that the merchandise should be classified as either: (1) studs, under HTSUS subheading 7318.15.50, with a duty rate of 4.7% ad valorem; (2) other base metal mountings, fittings and similar articles suitable for furniture, under HTSUS subheading 8302.42.30, with a duty rate of 5.7% ad valorem; or (3) other threaded articles, under HTSUS subheading 7318.19.00, with a duty rate of 5.7% ad valorem. Defendant opposes plaintiff's motion, claiming that a genuine issue of material fact exists as to whether the subject merchandise functions as a screw or as a bolt.

DISCUSSION

The Court may grant a motion for summary judgment if it finds the case lacks genuine issues of material fact, and that the moving party is entitled to judgment as a matter of law. USCIT Rule 56(d). The interpretation of a tariff term presents a question of law; therefore, if the only genuine issue before the Court is the meaning of a tariff term, the Court may grant summary judgment. Id.; Convertors Div. of Am. Hosp. Supply Corp. v. United States, 7 Fed. Cir. (T) 17, 19, 861 F.2d 710, 712 (1988).

In interpreting a tariff term, the Court presumes that Congress frames tariff acts using the language of commerce. Nylos Trading Co. v. United States, 37 CCPA 71, 73, C.A.D. 422, 1949 WL 4913 (1949). The Court also presumes that the commercial meaning of a tariff term coincides with its common meaning, in the absence of evidence to the contrary. United States v. C.J. Tower & Sons, 48 CCPA 87, 89, C.A.D. 770, 1961 WL 8716 (1961) (citation omitted). To determine the commercial or common meaning of a tariff term, the Court will draw on lexicons, its own knowledge, and other reliable sources. Id.

A. Screws.

Customs' classification of the merchandise as a screw, under subheading 7318.15.80, HTSUS, is afforded a statutory presumption of correctness. 28 U.S.C. § 2639(a)(1) (1988). Plaintiff bears the burden of rebutting this initial presumption. Id.

Customs asserts that it properly categorized the merchandise as a screw for two reasons. First, Customs asserts that the merchandise possesses the physical characteristics of a screw, as set forth by American National Standards Institute ("ANSI"). ANSI describes a screw as:

An externally threaded fastener capable of being inserted into holes in assembled parts, of mating with a preformed internal thread or forming its own thread, and of being tightened or released by torquing the head.

ANSI/ASME Standard B18.2.1 (1981). Second, Customs asserts that the merchandise looks like a shoulder screw. A shoulder screw is a single component fulcrum upon which a lever turns. Webster's Third New International Dictionary of the English Language Unabridged 2105 (1993).

Plaintiff argues that Customs overlooks the primary purpose of the merchandise in categorizing it as a screw, and the Court agrees. Many items, e.g. a light bulb, possess the physical characteristics of a screw in that they are externally threaded and are capable of being tightened by torquing of the head. For an item to be a screw, however, it should fulfill its primary purpose upon having its head torqued, and that purpose should be one recognized for a screw. For example, upon having its head torqued, the item should fasten other objects together, or perhaps serve as a single component fulcrum upon which a lever turns. See ANSI/ASME Standard B18.2.1 (1981); Webster's Third New International Dictionary of the English Language Unabridged 2105 (1993).

It is undisputed that the subject merchandise does not accomplish its primary purpose upon having its head torqued. Rather, the merchandise must mate with a cam in order to accomplish its purpose of joining and locking two boards together at an angle. Plaintiff's Statement of Material Facts at 2; Defendant's Response to Plaintiff's Statement of Material Facts at 3. The joint created by the mating of the merchandise and the cam is then tightened and locked by torquing the cam, not by torquing the head of the merchandise. Plaintiff's Statement of Material Facts at 3; Defendant's Response to Plaintiff's Statement of Material Facts at 4. Because the merchandise does not accomplish its primary purpose upon having its head torqued, it is not a screw. Plaintiff has established that Custom's classification focuses on the physical parameters of the merchandise without acknowledging the undisputed purpose of the merchandise. See Atlas Copco N. Am., Inc. v. United States, 17 CIT ___, ___, 837 F.Supp. 423, 427 (1993) (Customs' emphasis on the physical parameters of a "Swellex rock bolt," rather than on the use and common name of the item, caused it to incorrectly classify the item as something other than a bolt). Plaintiff has therefore rebutted the presumption of correctness in favor of Customs' classification decision.

B. Bolts.

Having found that plaintiff has rebutted the presumption in favor of Customs' classification decision, the Court turns to consider whether the alternative classifications proposed by the plaintiff fully describe the subject merchandise. See Jarvis Clark Co. v. United States, 2 Fed.Cir. (T) 70, 75, 733 F.2d 873, 878 (1984). Plaintiff first suggests that the category for bolts, HTSUS subheading 7318.15.20, describes the merchandise.

Dictionaries generally define the term "bolt" broadly, so as to encompass the subject merchandise. For example, Funk & Wagnalls' New Comprehensive International Dictionary of the English Language, Deluxe Edition (1980) defines a bolt as, among other things, "a pin or rod used for holding anything in its place." Webster's New World Dictionary of American English, Third College Edition (1988) defines a bolt as, among other things, "a threaded metal rod or pin for joining parts, having a head and usually used with a nut." Id. at 157. These dictionary definitions show that a bolt usually, but does not necessarily, work with a nut.

Courts have also interpreted the term "bolt" so as to embrace the subject merchandise. While the Court recognizes that decisions interpreting TSUS terms are not dispositive of the interpretation of HTSUS terms, the Court finds guidance in several decisions interpreting the term "bolt" under both the Tariff Schedules of the United States ("TSUS") and HTSUS. See H.Conf. Rep. No. 576, 100th Cong., 2d Sess. 548, reprinted in 1988 U.S.C.C.A.N. 1582. Under the TSUS, the Customs Court found that a bolt is: (1) in the shape of a pin or a rod; and (2) designed to fasten or hold something in place. A.L. Liebman & Son, Inc. v. United States, 65 Cust.Ct. 85, 90, C.D. 4059 (1970). This Court further found that a bolt need not work in conjunction with a nut. Atlas Copco, 837 F.Supp. at 423. Under HTSUS, this Court confirmed that "bolt" is a broad term with "dozens of permutations of form and application." S.I. Stud, Inc. v. United States, 17 CIT ___, ___, 1993 WL 261419, *7 (July 1, 1993), aff'd, 12 Fed.Cir. (T) ___, 24 F.3d 1394 (1994).

The industry which deals with the merchandise also interprets the term "bolt" so as to include the subject merchandise. Plaintiff advertises and refers to its merchandise as a "bolt" or "connecting bolt." Plaintiff's Memorandum in Support of Its Motion for...