On Monitors (and Anti-Monitors)
Prysm, Inc. v. United States, answers the question, "Are those cool looking video walls that show up in office building lobbies, hotel lobbies, and fancy conference centers monitors of the sort that are used with computers?" The answer, at least as far as the Court of International Trade is concerned, is no.
Here is an image, from the Prysm website, of what the case is about.
Technically, that device is a Display Wall System made up of laser phosphor display ("LPD") tiles and a proprietary image processor. The image processor accepts an incoming signal, converts it to Prysm's proprietary format, and sends it on to the LPD. The imported merchandise subject to this case is just the LPD tile, not the entire system.
Prysm contends that the LPD is properly classified as a part of a monitor in Heading 8529. In the alternative, Prysm contends that the LPD is classifiable in Heading 8528 as a monitor of a kind solely or principally used in an automatic data processing system of heading 8471. The government counters that the correct classification is in Heading 8528, but as an "other" monitor (i.e., one not used with an ADP system).
I am going to edit this down to get to the interesting bit. The Court first found the LPD to be a complete monitor, not part of a monitor, because it uses internal technology to display images and is capable of receiving signals from the image processor. The fact that is generally takes two or more to make a display wall system was not sufficient to make the LPD "parts."
So, that leaves the question of whether the LPD is the kind of monitor that is solely or principally used in an automatic data processing system of heading 8471. The answer to that question did not depend on the size of the typical wall display configured of LPD tiles. It does, however, depend on the principal use of the device, which is the single most common use in the United States for merchandise of the same class or kind. A "class or kind" of merchandise consists of items that are commercially fungible in all pertinent circumstances."
At first blush, this might seem like an odd inquiry. Most people, I say with absolutely no empirical evidence, equate monitors with computer displays. There was some expert testimony to that effect in the case, though it appears to have been unpersuasive. But, speaking as a guy who used to sell moderately high-end audio and video equipment for a living, there are monitors that are designed to be hooked up to sources other than computers. These form the guts of home theaters and other systems with the primary signal source being external TV tuners, cable/satellite boxes, and DVD players. Today, these monitors will almost always have connections that allow them to display data and images from a computer.
The HTSUS differentiates between monitors based on use. A 60-inch screen designed to be affixed to a wall with limited flexibility regarding height and angle, is unlikely to be the sort of monitor with which I might spend a quiet Saturday pounding out a blog post while thinking about superheros (see below). A computer monitor, on the other hand, is likely to be designed for closer viewing and incorporate tilt and swivel adjusting mechanisms and other ergonomic features. The imported LPD tiles lack any of those features.
Given the lack of features indicating use with automatic data processing systems and no strong evidence of that use, the Court found the LPD tiles to be classified as monitors of 8528.59.33, which are dutiable at 5% (give or take Section 301 duties).
I consider this to be one of those fascinating questions about the convergence of computer technology and everything else in the world. First, it appears that LPD technology could be used to build desktop monitors with ergonomic adjustments. That might happen, which would lead to a different result (at least for complete monitors). Moreover, it is 100% clear to me that these LPD tiles will almost always get their video images from an actual computer somewhere. Any other source would be incredibly static and probably not worth the efforts. This is particularly true in a conference room setting where task-specific data is almost always needed. Even in a building lobby, the management probably wants an easy way to change and update the image. The best way to do that is (likely) by hooking up a computer. Nevertheless, it does not appear that is enough to make the device into something that is principally used for automatic data processing. Rather, it is a large screen that can be driven by a number of sources, including a computer.
One last note, the HTSUS has changed since 2016 when these entries occurred. As of January 1, 2017, subheading 8528.51.00 was deleted and replaced with subheading 8528.51 (for monitors “[c]apable of directly connecting to and designed for use with an automatic data processing machine of heading 8471”). Subheading 8528.59.31 was also deleted. Thus, this decision should be considered in light of those changes when applied to current entries.
So, you might be asking, what is an Anti-Monitor? If you have to ask, you are not up to speed for the coming Crisis on Infinite Earths. Given my affection for all things DC, I am fully invested. Let's just say that the Monitor is a being as old as the universe who is running a poorly explained but clearly important strategy to save the multiverse from destruction in the coming Crisis. Although it has not yet been revealed, that Crisis may well be the work of the Monitor's evil sibling, the Anti-Monitor. We'll miss you, Oliver Queen, but thanks for your service.
The link to the trailer no longer works. Try this instead.
Here is an image, from the Prysm website, of what the case is about.
Technically, that device is a Display Wall System made up of laser phosphor display ("LPD") tiles and a proprietary image processor. The image processor accepts an incoming signal, converts it to Prysm's proprietary format, and sends it on to the LPD. The imported merchandise subject to this case is just the LPD tile, not the entire system.
Prysm contends that the LPD is properly classified as a part of a monitor in Heading 8529. In the alternative, Prysm contends that the LPD is classifiable in Heading 8528 as a monitor of a kind solely or principally used in an automatic data processing system of heading 8471. The government counters that the correct classification is in Heading 8528, but as an "other" monitor (i.e., one not used with an ADP system).
I am going to edit this down to get to the interesting bit. The Court first found the LPD to be a complete monitor, not part of a monitor, because it uses internal technology to display images and is capable of receiving signals from the image processor. The fact that is generally takes two or more to make a display wall system was not sufficient to make the LPD "parts."
So, that leaves the question of whether the LPD is the kind of monitor that is solely or principally used in an automatic data processing system of heading 8471. The answer to that question did not depend on the size of the typical wall display configured of LPD tiles. It does, however, depend on the principal use of the device, which is the single most common use in the United States for merchandise of the same class or kind. A "class or kind" of merchandise consists of items that are commercially fungible in all pertinent circumstances."
At first blush, this might seem like an odd inquiry. Most people, I say with absolutely no empirical evidence, equate monitors with computer displays. There was some expert testimony to that effect in the case, though it appears to have been unpersuasive. But, speaking as a guy who used to sell moderately high-end audio and video equipment for a living, there are monitors that are designed to be hooked up to sources other than computers. These form the guts of home theaters and other systems with the primary signal source being external TV tuners, cable/satellite boxes, and DVD players. Today, these monitors will almost always have connections that allow them to display data and images from a computer.
The HTSUS differentiates between monitors based on use. A 60-inch screen designed to be affixed to a wall with limited flexibility regarding height and angle, is unlikely to be the sort of monitor with which I might spend a quiet Saturday pounding out a blog post while thinking about superheros (see below). A computer monitor, on the other hand, is likely to be designed for closer viewing and incorporate tilt and swivel adjusting mechanisms and other ergonomic features. The imported LPD tiles lack any of those features.
Given the lack of features indicating use with automatic data processing systems and no strong evidence of that use, the Court found the LPD tiles to be classified as monitors of 8528.59.33, which are dutiable at 5% (give or take Section 301 duties).
I consider this to be one of those fascinating questions about the convergence of computer technology and everything else in the world. First, it appears that LPD technology could be used to build desktop monitors with ergonomic adjustments. That might happen, which would lead to a different result (at least for complete monitors). Moreover, it is 100% clear to me that these LPD tiles will almost always get their video images from an actual computer somewhere. Any other source would be incredibly static and probably not worth the efforts. This is particularly true in a conference room setting where task-specific data is almost always needed. Even in a building lobby, the management probably wants an easy way to change and update the image. The best way to do that is (likely) by hooking up a computer. Nevertheless, it does not appear that is enough to make the device into something that is principally used for automatic data processing. Rather, it is a large screen that can be driven by a number of sources, including a computer.
One last note, the HTSUS has changed since 2016 when these entries occurred. As of January 1, 2017, subheading 8528.51.00 was deleted and replaced with subheading 8528.51 (for monitors “[c]apable of directly connecting to and designed for use with an automatic data processing machine of heading 8471”). Subheading 8528.59.31 was also deleted. Thus, this decision should be considered in light of those changes when applied to current entries.
So, you might be asking, what is an Anti-Monitor? If you have to ask, you are not up to speed for the coming Crisis on Infinite Earths. Given my affection for all things DC, I am fully invested. Let's just say that the Monitor is a being as old as the universe who is running a poorly explained but clearly important strategy to save the multiverse from destruction in the coming Crisis. Although it has not yet been revealed, that Crisis may well be the work of the Monitor's evil sibling, the Anti-Monitor. We'll miss you, Oliver Queen, but thanks for your service.
The link to the trailer no longer works. Try this instead.
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