United States v. Rembrandt Electronics, Inc.

• Decision Date: 21 October 1976
• Docket Number: Customs Appeal No. 76-4.
• Citation: 542 F.2d 1154
• Parties: The UNITED STATES, Appellant, v. REMBRANDT ELECTRONICS, INC., Appellee.
• Court: U.S. Court of Customs and Patent Appeals (CCPA)

542 F.2d 1154

The UNITED STATES, Appellant, v. REMBRANDT ELECTRONICS, INC., Appellee.

Customs Appeal No. 76-4.

United States Court of Customs and Patent Appeals.

October 21, 1976.

Rex E. Lee, Asst. Atty. Gen., Washington, D. C., Andrew P. Vance, Chief, Customs Section, Ira J. Grossman, Edmund F. Schmidt, New York City, attys. of record, for appellant.

Shaw & Stedina, New York City, attys. of record, for appellee; Charles P. Deem, New York City, of counsel.

Before MARKEY, Chief Judge, and RICH, BALDWIN, LANE and MILLER, Judges.

MARKEY, Chief Judge.

The United States appeals from the judgment of the United States Customs Court, 405 F.Supp. 588, 75 Cust.Ct. ___, C.D. 4613 (1975) sustaining appellee's (Rembrandt's) claim that certain imported television antenna switches are classifiable as "television apparatus, and parts thereof," under item 685.20 of the Tariff Schedules of the United States (TSUS) rather than as "electrical switches" under item 685.90. We reverse.

The imported merchandise consists of rotary television antenna switches made in Japan for Rembrandt in accordance with specifications in U.S. patent number 2,585,670 for a television antenna system.

The Patent specification teaches use of the imported switch for alternatively connecting different combinations of television antenna arms to produce improved picture quality or reception for a given station. Rembrandt, a licensee under the patent, used the switches solely in the manufacture of indoor television antennas.

The switches were originally classified by the Regional Commissioner under item 685.90, TSUS, which reads:

                  Part 5: ELECTRICAL MACHINERY
                 AND EQUIPMENT
                        *  *  *
                Item 685.90 Electrical switches, relays
                             fuses, lightning arresters
                             plugs, receptacles, lamp
                             sockets, terminals, terminal
                             strips, junction boxes
                             and other electrical apparatus
                             for making or breaking
                             electrical circuits, for
                             the protection of electrical
                             circuits, or for making connections
                             to or in electrical
                             circuits; switchboards
                             (except telephone switchboards)
                             and control panels
                             all the forgoing and parts
                             thereof ................... 17.5% ad val
                

Rembrandt's contention, sustained by the Customs Court, was that the switches were more properly classifiable under item 685.20:

                Item 685.20 Radiotelegraphic and radiotelephonic
                             transmission and
                             reception apparatus; radio-broadcasting
                             and television
                             transmission and reception
                             apparatus, and television
                             cameras; record players,
                             phonographs, tape recorders,
                             dictation recording and
                             transcribing machines, record
                             changers, and tone arms;
                             all of the foregoing, and any
                             combination thereof, whether
                             or not incorporating clocks
                             or other timing apparatus,
                             and parts thereof:
                                  *  *  *
                           Radiotelegraphic and radiotelephonic
                            transmission and
                            reception apparatus;
                            radio-broadcasting
                            and television
                            transmission and reception
                            apparatus, and parts thereof:
                              Television apparatus, and
                                parts thereof ................ 10% ad val.
                

Another pertinent statutory provision is:

10. General interpretative rules.—For the purposes of these schedules—

* * * * * *

(ij) a provision for "parts" of an article covers a product solely or chiefly used as a part of such article, but does not prevail over a specific provision for such part.

The Customs Court grounded its decision on the premise that item 685.90 "has been held to relate to electrical power applications," relying on Midland International Corp. v. United States, 295 F.Supp. 1101, 62 Cust.Ct. 164, C.D. 3715 (1969), and General Electric Co. v. United States, 63 Cust.Ct. 140, C.D. 3887 (1969), aff'd, 441 F.2d 1186, 58 CCPA 152, C.A.D. 1021 (1971). The Customs Court stated:

The switches herein have been established by competent testimony to be utilized in the antenna portion which picks up the transmitted television signal. Such application is not a power circuit and hence the involved switch is not the type intended to be covered by said item 685.90, supra.

* * * * * *

Inasmuch as said articles are not switches within the scope of item 685.90, supra, they are consequently not governed by rule 10(ij), supra.

Because the switches had been manufactured to precise specifications, to fit and make operative the patented television antenna system, and because the government conceded that the switches were used exclusively in television antennas, the court sustained Rembrandt's claimed classification as "parts of television reception apparatus" under item 685.20.

OPINION

The distinction between "electrical power circuits" and "low current audio circuits" upon which the Customs Court relied had its genesis in Midland International Corp. v. United States, supra. There the Customs Court was faced with a protest to the classification of certain connectors, jacks and plugs under item 685.90. The importer claimed that the merchandise should fall under item 685.50 as "Other" articles of that section. The Customs Court held that the importer had failed to prove sole or chief use of the merchandise as required by Rule 10(ij) and, therefore, overruled the protest. In addition, however, the Customs Court stated that "a careful reading of item 685.90 establishes to our satisfaction that all of the articles enumerated therein are for use in power circuits." Although that conclusion was dictum, it seems to have been emphasized in later opinions of this court containing overly broad language directed to the scope of item 685.90. In United States v. General Electric Co., 441 F.2d 1186, 58 CCPA 152, C.A.D. 1021 (1971), the court agreed with the classification of certain radio earphone jacks, very similar to those in Midland, under item 685.22 rather than under 685.90. The rationale for doing so, however, was the...