The reason Roche Vitamins, Inc. v. United States is a tricky classification case has to do with HTSUS Note 1 to Chapter 29, which states that "Except where the context otherwise requires, the headings of this Chapter apply only to: [certain products] with an added stabilizer (including anticaking agent) necessary for their preservation or transport."
Furthermore, the Explanatory Notes to Heading 2936 states:
The products of this heading may be stabilized for purposes of preservation or transport:
by adding anti-oxidants,
by adding anti-caking agents(e.g., carbohydrates),
by coating with appropriate substances (e.g., gelatin, waxes, or fats) whether or not plasticized, or
by adsorbing on appropriate substances (e.g., silicic acid),
provided that the quantity added or the processing in no case exceeds that necessary for their preservation or transport and that the addition or proceeding does not alter the character of the basic product and render it particularly suitable for specific use rather than for general use.According to the government's theory of this case, the BetaTab has been processed to such a degree that it has a specific use as a nutritional ingredient in vitamin tablets and capsules. For its part, Roche maintained that none of the added ingredients or processing prepare the BetaTab for use in tablets and that the product remains useful as in ingredient in tablets, capsules, foods, and as a colorant.
This is the odd classification case in which there is no dispute as to the meaning of the tariff. Instead, this was all about the question of fact of whether BetaTab has a specific use. In that circumstance, the Court of Appeals reviews the Court of International Trade for clear error. On this standard, there was no clear error in the CIT's finding that the additional ingredients and processing in the BetaTab do not render it suitable for a specific use. As a result, the Federal Circuit affirmed the CIT.
One down, a bunch more posts to follow.