Tuesday, January 05, 2010

Friends Don't Let Friends Classify

I have been in a single ballroom containing a very large segment of the lawyers working in the customs law field. Basically, we all know or know of each other. I bring this up, because I might be about the piss off some friends and former colleagues. So be it. I am also about to potentially annoy the U.S. Court of Appeals for the Federal Circuit.

The source of all this potential annoyance is Outer Circle Products v. United States, which the Federal Circuit decided today. I discussed this case previously. It involves the classification of zippered bottle wraps, kind of like can kozies but bigger. The Court of International Trade classified them in 4202 as "bottle cases," which are specifically listed in the heading. In doing so, the CIT had to distinguish a prior decision of the Federal Circuit in which that court held that 4202 (as it then existed) does not cover "containers that organize, store, protect, or carry food or beverages." The CIT's decision held that as imported without a bottle, the wraps could not contain anything. Ergo, the prior decision did not control and the wraps were to be classified eo nomine as bottle cases.

On appeal, the Federal Circuit stuck to its prior decision and reversed the CIT. The CAFC reasoned that the coolers at issue in the earlier case were not designed to store or protect loose food without further containment. Rather, the coolers would contain numerous containers of food. Similarly, the bottle cases are designed to contain a bottle containing a beverage. Hence, the no-food-or-beverage rule applies.

That seems straightforward and advances the law by affirming a bright-line rule. Everyone should now know that food and beverage containers stay out of 4202, as it then existed.

Here's my question: So what does 4202 mean when it specifically mentions bottle cases? I think I understand the CAFC to be saying that "bottle cases" are for protecting, carrying, and storing empty bottles or bottles filled with other non-food or beverage items. This is because no other items listed in 4202 are intended to contain food or beverages. So, the analysis makes legal and practical sense.

But, look at this wine bottle case. It is leather-ish, has a cover with a clasp, and a shoulder strap. For all intents and purposes, it is a suitcase for wine bottles. Guess what goes in 4202: suitcases. But, under this decision, that bottle case belongs somewhere else in the tariff schedule. I'm not sure that advances the law in a predictable way. It seems to me that the classification of a bottle case should not depend on either what the bottle contains or whether it is empty.

So, "nice work" to the folks who did a good job and won the case on appeal. You should be happy that I was not on the panel. To the panel, when next we meet, please keep in mind that reasonable minds can differ and I clearly have no idea what I am talking about.

No comments: