Marubeni America Corp. v. US

Decision Date03 October 1995
Docket NumberSlip Op. No. 95-168,Court No. 91-10-00730.
Citation905 F. Supp. 1101,19 CIT 1249
PartiesMARUBENI AMERICA CORPORATION, Plaintiff, v. UNITED STATES, Defendant.
CourtU.S. Court of International Trade

Fitch, King and Caffentzis (Richard C. King,), for plaintiff.

Frank W. Hunger, Assistant Attorney General; Joseph I. Leibman, Attorney-in-Charge, International Trade Field Office, Commercial Litigation Branch, Civil Division, United States Department of Justice (James A. Curley,); Jacob D. Diamond, Office of the Assistant Chief Counsel, United States Customs Service, of counsel, for defendant.

OPINION AND ORDER

NEWMAN, Senior Judge:

INTRODUCTION

The issue presented concerns the proper tariff classification and rate of duty to be assessed by the United States Customs Service ("Customs") on certain internally grooved seamless copper tubing, sold under the trade name "Thermofin" by Hitachi Cable Ltd. of Japan and imported by plaintiff during 1989-90.

Jurisdiction is predicated on 28 U.S.C. § 1581(a), and therefore Customs' classification decision is before the court for de novo review in accordance with 28 U.S.C. § 2636. Currently before the court for decision are cross-motions for summary judgment.

The merchandise was classified by Customs under the provision for profiles of refined copper in subheading 7407.10.10 of the Harmonized Tariff Schedule of the United States ("HTSUS"), effective January 1, 1989, and duty was assessed at the rate of 6.3 per centum ad valorem.

Plaintiff claims that the merchandise is properly dutiable as seamless tubes and pipes of refined copper under subheading 7411.10.10, HTSUS at the rate of 1.5 per centum ad valorem.

UNDISPUTED FACTS

The record before the court on the cross-motions comprises: a sample 8 inch piece of the imported 3/8 ths inch diameter Hitachi "Thermofin" tubing as well as a sample piece of the "mother" tube from which the imported tubing was drawn in the production process (plft's exh. 1), 4½ inch piece of Hitachi LFT-2 low fin copper tube (plft's exh. 27), an affidavit of Hajime Ichiki (plft's exh. 2), a declaration of Osamu Kawamata (plft's exh. 24), United States Patent Nos. 4,373,366 and 4,658,892 (plft's exh. 3) describing in detail the production process for the imported merchandise and the merchandise itself, and a toy top (plft's exh. 23) submitted by plaintiff; declarations of Dr. Thomas J. Rabas and Norman R. Clevinger were submitted on behalf of defendant. Also, copies of marketing literature and numerous other documentary exhibits were submitted in connection with the parties' motion papers.

The merchandise in its condition as imported has a smooth circular outer surface, is seamless, of regular cross-section, with helical ridges and grooves spiralling the length of the tube on the inner surface. As a consequence of the internally grooved surface, the imports while having a uniform cross-section, do not have a uniform wall thickness.

The Thermofin tubing was imported in various diameters ranging from 5/16 inches — 5/8 inches and packed in wound coils. After importation, the tubing was straightened, cut, bent and assembled into evaporator/condenser coils or heat exchanger units for air conditioning and refrigerating systems. The internal grooving affects the movement of the liquid or gas passing through the tubing enabling it to perform its function in a refrigeration system more efficiently since an extended internal surface area of the tubing is exposed to refrigerant fluid that passes through the tube and also because the grooved inner surface creates increased turbulence in the refrigerant fluid. Enhanced inner wall surfaces in copper tubing were developed about 1976 by Hitachi, and represented a significant advancement in efficiency of heat transfer for refrigeration and air conditioning systems over tubing having a smooth inner wall.

While the inner grooved configuration of the tubing itself causes a linear to rotary motion of liquid passing through the tube, neither the tube nor the internal grooving rotates or otherwise moves so as to actively transmit motion to the liquid or gas passing through the tubing. Both the linear and then rotary motion of the liquid passing through the tubing result from the pressure applied by the system's compressor to the refrigerant fluid in the tubing which simply follows the internal wall configuration of ridges and grooves. The purpose of the ridges and grooves is not to actively transmit motion to the refrigerant fluid (which is accomplished by the compressor), but to enhance the efficiency of heat transfer by exposing the refrigerant fluid to more surface area and creating within the refrigerant fluid a state of turbulence due to the linear/rotary motion.

According to the United States Patents (exhibit 3), the spiral grooves on the inner surface of the tubes were produced by a "grooving machine," and the merchandise is referred to as an "inner surface grooved tube." Further, plaintiff's advertising literature (exhibit 4) states that the THERMOFIN tubes have "inner grooves." Thermofin tubes have never been marketed in the United States as threaded tubes.

DISCUSSION
I.

Summary judgment pursuant to CIT Rule 56 is appropriate in this case inasmuch as no genuine issue as to any material fact exists. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Mingus Constructors, Inc. v. United States, 812 F.2d 1387 (Fed.Cir.1987).

Under Chapter 74, Note 1(h), HTSUS ("Note 1(h"), "tubes and pipes" are defined as: "Hollow products, coiled or not, which have a uniform cross section with only one enclosed void along their whole length in the shape of circles * * *, and which have a uniform wall thickness. * * * Tubes and pipes of the foregoing cross sections may be * * * threaded * * *" (emphasis added). According to defendant, because the imported product is not "threaded," lack of uniform wall thickness precludes classification of the merchandise under the HTSUS as a tube (i.e., as defined in Note 1(h)) and requires classification of the imports as profiles.

To be classifiable as a tube or pipe under Heading 7411, a product must, with certain exceptions, meet the specification in Note 1(h) of a "uniform wall thickness." The definitional specification of "uniform wall thickness" under Note 1(h) is concededly absent in the imports by virtue of their internal grooving. The relevant exception in Note 1(h) to the requirement of uniform wall thickness is for a product that is "threaded." Hence, the imports must be excluded from classification as "tubes or pipes" and classifiable as "profiles" unless the imports by virtue of their internal grooving are "threaded" within the meaning of that term in Note 1(h).

Accordingly, references herein to the imports as "tubes" or "pipes" are merely generically descriptive and carry no suggestion as to the proper tariff classification of the merchandise, which must be based on the pertinent definitions in the HTSUS.

II.

The controlling dispute, then, between the parties is not whether in a dictionary definition or generic sense the imports are tubes or pipes, but rather whether the imports meet the HTSUS definition of those products in Note 1(h), particularly the exception to the "uniform wall thickness" requirement of "threaded." See Rule 6, General Rules of Interpretation of the Harmonized System ("For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related notes ..."). Cf. Clipper Belt Lacer Co. v. United States, 14 CIT 146, 738 F.Supp. 528 (1990), aff'd 923 F.2d 835 (Fed.Cir.1991).

The relevant product definitions in Note 1 read:

(e) Profiles
Rolled, extruded, drawn, forged or formed products, coiled or not, of a uniform section along their whole length, which do not conform to any of the definitions of * * * tubes or pipes. * * *
(h) Tubes and pipes.
Hollow products, coiled or not, which have a uniform cross section with only one enclosed void along their whole length * * * and which have a uniform wall thickness ... Tubes and pipes of the foregoing cross sections may be * * * threaded * * *. Emphasis added.

As the Note 1(h) definition for tubes and pipes, supra, provides statutory specifications for classification under Heading 7411, it is the tariff definition and specifications, not common or commercial meaning, that is conclusive for classification purposes See Brookside Veneers, Ltd. v. United States, 847 F.2d 786, 789 (Fed.Cir.), cert. denied, 488 U.S. 943, 109 S.Ct. 369, 102 L.Ed.2d 358 (1988) (definitional limitation of term in tariff headnote is controlling as to classification regardless of common or commercial meaning). See also Overton & Co. v. United States, 85 Cust.Ct. 76, 80-81, C.D. 4875 (1980). Therefore, the court need not ascertain or address the common or commercial meaning of "tube" or "pipe," or determine whether or not the imports fall within the common or commercial meaning of those terms. Those are not issues before the court.

III.

In the interest of narrowing the legal issue in this case, defendant admits that the imported product would meet the definition for "tubes and pipes" in Note 1(h) if it had a uniform wall thickness; concededly, due to the internally grooved surface it does not. The issue, then, is narrowed to whether the grooving meets the definitional specification "threaded." The court can determine the tariff meaning of that term as a matter of law, W.R. Filbin & Co., Inc. v. United States, 945 F.2d 390, 392 (Fed.Cir.1991), which may be resolved on a motion for summary judgment. Digital Equipment Corp. v. United States, 889 F.2d 267, 268 (Fed.Cir.1989). See also Clipper Belt Lacer, 923 F.2d at 837.

While Note 1(h) defines tubes and pipes, the term "threaded" in the Note is itself statutorily undefined. Tariff terms that are statutorily undefined are construed in accordance with their...

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