Rubies Costume Co. v. United States

• Decision Date: 31 October 2017
• Docket Number: Court No. 13–00407,Slip Op. 17–147
• Citation: 279 F.Supp.3d 1145
• Parties: RUBIES COSTUME CO., Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

279 F.Supp.3d 1145

RUBIES COSTUME CO., Plaintiff,

v.UNITED STATES, Defendant.

Slip Op. 17–147

Court No. 13–00407

United States Court of International Trade.

October 31, 2017

Glenn H. Ripa, John A. Bessich, and Suzanne L. McCaffery, Follick & Bessich, of New York, NY, for Plaintiff.

Peter A. Mancuso, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of New York, NY, for Defendant. With him on the brief were Chad A. Readler, Acting Assistant Attorney General, and Amy M. Rubin, Assistant Director. Of Counsel on the brief was Michael W. Heydrich, Office of the Assistant Chief Counsel, International Trade Litigation, U.S. Customs and Border Protection, of New York, NY.

OPINION

Barnett, Judge:

In this case, the court addresses the issue of the proper classification of a Santa Claus costume. Is it a "festive article" entitled to duty free treatment, or is it fancy dress, of textile, akin to wearing apparel, dutiable at the rates applicable to the particular parts of the costume? Application of classification principles in this case (the General Rules of Interpretation, which direct the court to apply the terms of the Harmonized Tariff Schedule, and relevant judicial precedent) leads to a finding that, while flimsy and non-durable costumes (whether for Halloween, Christmas, or any other holiday) generally receive duty free treatment as festive articles, and non-flimsy, durable Christmas sweaters may also receive duty free treatment as festive articles (because they are not fancy dress), a relatively well-made, durable, dry clean only Santa Claus costume constitutes fancy dress, of textile, and is, therefore, excluded from classification as a festive article.

Before the court are cross-motions for summary judgment. See Pl.'s Mot. for Summ. J., ECF No. 28, and Mem. of Law in Supp. of Pl.'s Mot. for Summ. J ("Pl.'s MSJ"), ECF No. 28–1; Def.'s Cross–Mot. for Summ. J. and Mem. in Supp. of Def.'s Cross–Mot. for Summ. J ("Def.'s XMSJ"), ECF No. 30. Plaintiff Rubies Costume Company ("Rubies" or "Plaintiff") contests the denial of its protest challenging U.S. Customs and Border Protection's ("Customs" or "CBP") classification of a multi-piece Santa Claus suit ("Santa Suit"). See Summons, ECF No. 1; Compl., ECF No. 5. Plaintiff contends the Santa Suit qualifies for duty free treatment as a "[f]estive, carnival or other entertainment article [ ]" (hereinafter referred to as a "festive article") pursuant to subheading 9505.10.50 of the Harmonized Tariff Schedule of the United States ("HTSUS"), or, alternatively, subheading 9505.90.60 of the HTSUS. Pl.'s MSJ at 2–3. Defendant United States ("Defendant" or the "Government") contends that Customs correctly classified the Santa Suit under tariff provisions corresponding to the individual garments and accessories that, together, compose the Santa Suit. Def.'s XMSJ at 1–2. For the following reasons, the court finds that the Santa Suit is not a festive article, and, therefore, is properly classified pursuant to the below-stated individual tariff provisions.

BACKGROUND

I. Material Facts Not in Dispute

The party moving for summary judgment must show "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." United States Court of International Trade ("USCIT") Rule 56(a). Movants should present material facts as short and concise statements, in numbered paragraphs, and cite to "particular parts of materials in the record" as support. USCIT Rule 56(c)(1)(A) ; see also USCIT Rule 56.3(a) ( "factual positions described in Rule 56(c)(1)(A) must be annexed to the motion in a separate, short and concise statement, in numbered paragraphs"). In responsive papers, the nonmovant "must include correspondingly numbered paragraphs responding to the numbered paragraphs in the statement of the movant." USCIT Rule 56.3(b). Parties filed cross motions for summary judgment and submitted separate statements of undisputed material facts with their respective motions. See Pl.'s Am. Statement of Material Facts Not in Dispute ("Pl.'s SOF"), ECF No. 34; Def.'s Statement of Undisputed Material Facts ("Def.'s SOF"), ECF No. 30–1. Defendant also filed a response to Plaintiff's statement of facts. See Def.'s Resp. to Pl.'s Statement of Material Facts Not in Dispute ("Def.'s Resp. to Pl.'s SOF"), ECF No. 30–2. Plaintiff did not file a response to Defendant's statement of facts and has informed the court that it admits all of Defendant's factual assertions. See Notice from the Court (June 26, 2017), ECF No. 36. Parties also filed supplemental facts specific to the Santa Suit jacket. See Pl.'s Resp. to the Court's Order of July 28, 2017 ("Pl.'s Suppl. Br."), Ex. 1 (CBP Lab Report NY20171073), ECF No. 40–1; Def.'s Resp. to the Court Order Dated July 28, 2017 Req. Suppl. Briefing ("Def.'s Suppl. Br."), Ex. 2 (CBP Lab Report NY20171073), ECF No. 41–2. Upon review of the Parties' facts (and supporting exhibits),¹ the court finds the following undisputed and material facts.²

Rubies, a wholesale and retail costume company, is the importer of record of the subject Santa Suit. Pl.'s SOF ¶¶ 1, 9; Def.'s Resp. to Pl.'s SOF ¶¶ 1, 9; see also Pl.'s SOF ¶ 21; Def.'s Resp. to Pl.'s SOF ¶ 21 (subject merchandise is imported for domestic resale).³ The Santa Suit consists of a red jacket, pants, and hat, a black belt with a metal buckle, white gloves, black shoe covers, a white wig, and a Santa sack that are packaged together for retail sale as the "Premier Plush 9 Piece Santa Suit." Def.'s SOF ¶ 1. Only the jacket, pants, gloves, and sack are at issue in this case.⁴

The jacket and pants consist of 73% acrylic and 27% knit polyester material,⁵ and have sewn-in care labels stating that each item is "Dry Clean Only." Id. ¶¶ 2, 3. The jacket is made in one "standard size," consists of plush fabric, and is fully lined with satin polyester. Id. ¶ 4; Physical Sample. The jacket fabric "has a stitch count per one centimeter of [seven] in the horizontal [direction] and [seven] in the vertical direction." Pl.'s Suppl. Br, Ex. 1; Def.'s Suppl. Br., Ex. 2. The jacket has "a full front opening secured by a zipper," which is hidden by a left-over-right faux fur cover held in place by two metal snaps, one at the collar of the jacket and one at the base of the jacket. Def.'s SOF ¶¶ 6–7. The double-layer collar consists of white faux fur fabric. Id. ¶ 5. "The jacket has long sleeves with turned edges, trimmed with white faux fur fabric cuffs," id. ¶ 8, and "a straight cut hemmed bottom trimmed with the same white faux fur fabric," id. ¶ 9. The jacket may be worn over other clothing or undergarments, id. ¶ 10, and has belt loops for the belt, Physical Sample. The pants have a satin polyester lining, pockets with hemmed edges, an elasticized waist, and tightly stitched interior seams. Def.'s SOF ¶¶ 11–12. The white knit gloves consist of 100% polyester knit fabric. Id. ¶ 13.⁶ The sack is made from the same material as the jacket and pants, and has a drawstring cord. Id. ¶ 14. The Santa Suit packaging describes the sack as a "toy bag." Physical Sample.

The Santa Suit has a wholesale price of USD 60–70 and a retail price of USD 100, which is considered "a mid-to-high price point." Id. ¶ 24. It is "manufactured to be worn repeatedly during a single Christmas season" and "is intended to survive multiple wearings and cleanings" over several Christmas seasons. Id. ¶¶ 25–26. The Santa Suit covers the body of the individual wearing it and provides warmth and protection to the wearer. Id. ¶ 27.

II. Procedural History

On June 20, 2012, Rubies sought a binding pre-importation ruling from Customs regarding the classification of the Santa Suit. See Def.'s XMSJ, Ex. 2 ("HQ H237067"), ECF No. 30–4. On June 20, 2013, Customs issued its ruling. See generally HQ H237067. Relying on the Court of Appeals for the Federal Circuit's ("Federal Circuit") opinion in Rubie's Costume Co. v. Unites States ("Rubie's II "),⁷ 337 F.3d 1350 (Fed. Cir. 2003),⁸ and Customs' informed compliance publication regarding the classification of textile costumes, Customs distinguished the "well-made" Santa Suit from the "flimsy costumes" it classifies as festive articles. HQ H237067 at 6–9.⁹ Accordingly, Customs determined that the jacket and pants are classifiable as "wearing apparel" under headings 6105 and 6103, respectively. Id. at 9. Customs further found that the gloves and sack are classifiable under headings 6116 and 4202, respectively. Id. at 9–10.

On August 20, 2013, Plaintiff entered 36 Santa Suits under Entry Number BPQ– 1066668–8 through the John F. Kennedy Airport in New York. Compl. ¶¶ 5–6; Answer ¶¶ 5–6, ECF No. 11; see also Summons at 1. On October 25, 2013, Customs liquidated the Santa Suits as follows:

Item                 HTSUS Classification     Duty Rate
                Jacket               6105.20.20               32.0% ad valorem
                Pants                6103.43.15               28.2% ad valorem
                Gloves               6115.95.6010             10.0% ad valorem
                Sack                 4202.92.30               17.6% ad valorem
                Beard, Wig, Hat,     9505.90.60               Free of Duty
                Belt, and Shoe
                covers
                

Editor's Note: The preceding image contains the reference for footnote¹⁰

Pl.'s SOF ¶ 4; Def.'s Resp. to Pl.'s SOF ¶ 4.

Rubies timely protested Customs' classification of the subject merchandise; on December 14, 2013, that protest was deemed denied. Pl.'s SOF ¶¶ 5–6; Def.'s Resp. to Pl.'s SOF ¶¶ 5–6; see also Summons at 1. Rubies challenges the denial of its protest. Parties have fully briefed the issues. The court now rules on the cross-motions for summary judgment.

JURISDICTION AND STANDARD OF REVIEW

The court has subject matter jurisdiction pursuant to 28 U.S.C. § 1581(a). Jurisdiction is uncontroverted in this case. Pl.'s SOF ¶ 2; Def.'s Resp. to Pl.'s SOF ¶ 2.

The court may grant summary judgment when "there is no genuine issue as to any material fact," and "the moving party is entitled to judgment as a matter of...