Victoria's Secret is Tariff Classification

Remember my post on the question of whether a fit model can testify on the question of whether a shelf bra provides support for her bosom? Sure you do, it's a classic of the customs blog genre.

The Court of International Trade has now decided the relevant cases, which are Lerner New York, Inc. v. United States and Victoria's Secret Direct v. United States.

Starting with Victoria's Secret, the issue was whether the article of clothing was properly classified as tank top or similar garment, which is the classification proposed by Customs and Border Protection. Plaintiff argued that the top was either a brassier or an unspecified "other garment." The garment was described on the invoice as a "basic tank" with "shelf bra." I am no expert on fashion, but a little time on Bing leads me to believe that this is similar to the garment in question:

According to the Court:

The shelf bra is formed from two pieces of fabric (front and back) that are sewn together and that together extend around the entire upper, inner portion of the garment.  The fabric immediately above the elastic band is gathered by the band. The top of the shelf bra is attached to the body of the garment only at the upper hem of the garment and is attached around the entire circumference of the upper hem.

The legal issue here seems to revolve around the fact that this garment provides the wearer with the support of a bra and an article of outerwear in one garment. In the words of one witness, "It was a top that provided the support of a bra."

The government asserted that this garment should be classified in Heading 6109, which covers "T-shirts, singlets, tank tops and similar garments, knitted or crocheted." Tariff classification in the proper subheading of this heading would have resulted in a duty rate of 16.5% Classification as a brassier as put forward by the plaintiff would result in a rate of 6.6%. The plaintiff's alternative classification as an other garment of Heading 6114 carried a rate of 10.8%

In this context, and relying on the Explanatory Notes, the Court of International Trade found that articles in this heading are of the kind normally worn as undershirts. The fact that T-shirts may be printed with pictures and words for use as outerwear does not change that conclusion because the garments remain derived from or similar to t-shirts used as undershirts. Similarly, the fact that some tank tops are worn as outerwear does not mean that they are not similar to the sleeveless, light-weight garments often worn by men as undershirts. A lot of this has to do with the difference between American and British English and the meaning of the term "vests," which does not appear in the U.S. version of the HS. The Court further found that women's garments that provide support, such as brassieres and corsets, are not included in Heading 6109. Because the garment in question was both outerwear and provided support, it was not properly classified in Heading 6109.

Getting to that conclusion involved two interesting arguments. The first had to do with the fact that the importer described these garments as tank tops on the invoices and in marketing literature. Typically, that would lead to the conclusion that they are classifiable eo nomine as tank tops in Heading 6109. But, that is not always the case. The Court made the important statement that:

the record fact that plaintiff identified the Bra Top in various communications as a “tank” or “tank top” is not an admission by plaintiff that the garment at issue is a “tank top” within the meaning of that term as used in the heading 6109 article description. The meaning of a tariff term is a question of law and, therefore, cannot be the subject of a factual admission by a party; instead, the court has the “independent responsibility to decide the legal issue of the proper meaning and scope of HTSUS . . .

The reason this is important is that it goes to the heart of one of the problems in customs tariff litigation. Usually, the case is decided on a question of law. In this case, the question presently under review is the scope of Heading 6109. The fact that a Victoria's Secret might call this product a tank top does not make it legally so. Moreover, statement is just a fact that does not change the legal scope of the heading. If it did, Victoria Secret should start invoicing all of its products as "duty-free millstones" because that would make them classifiable in 6804.10.00 and duty free. Rather, as the Court noted, it is up to the Court to make the legal determination as to the meaning of the tariff term.

The reason I say this points to a problem in tariff litigation is that both sides spend a lot of time trying to find examples of the importer or Customs calling a product one thing or another, depending on their perspective. But, as the Court said here, that really does not mean much of anything. Again, if a witness for the importer refers to its pencil as a fork, all we know is that the witness said this, not that the item is legally a fork.

The other interesting argument raised by the government was that the shelf bra tank top is an improved version of the standard tank top and is, therefore, included in 6109 under the eo nomine provision for tank tops. Usually, this is a compelling argument. The tariff schedule is intended to cover newly invented items and improvements on old items. Maybe this is just a fancy new tank top. The Court, however, noted that its conclusion that 6109 does not cover support garments and does not cover outerwear effectively eliminates this garment from being classified as an improved tank top. In other words, even though the plaintiff calls it a tank top, the plaintiff is legally incorrect and this is an article of outerwear with support features.

Given all that, the question remained as to the correct classification. The plaintiff first argued that the merchandise should be classified as a brassier or similar article. The Court concluded that brassieres are undergarments and that sports bras are the adaptations of brassieres for use as sportswear. According to the Court, this garment was neither. That left the goods to be classified in 6114 as an other garment, knitted or crocheted. Given that 10.8% is a lot lower than 16.5%, that seems like a victory for Victoria.