Composite Wood is not Necessarily Veneered

In Composite Technology International, Inc v. United States, the Court of International Trade considered the tariff classification of wooden door stiles and rails consisting of a 9.5 mm thick pine cap laminated to a based of laminated poplar wood layers. Each poplar layer is lass than 6 mm thick. The exposed surface is a layer of pine.

Customs classified the merchandise in 4421.90.97 as other articles of wood. The imported protested that classification and claimed that the correct classification is 4412.99.51 as other plywood, veneered panels, and similar laminated wood. The issue, therefore, was whether the imported merchandise is properly classified as plywood, veneered panels, or similar laminated wood. If so, it would not be classifiable as an "other article of wood."

According to the plaintiff, the merchandise described above fits squarely within the definition of a veneered panel or, in the alternative, as a "similar laminated wood."

For those of you who, like me, might have no idea what this case is about, here is a useful illustration:

From Homestead Interior Doors http://www.door.cc/
Looking at the Explanatory Notes, the Court quickly identified the apparent problem for the plaintiff. The Explanatory Notes state that these products are a thin veneer of wood affixed to a base. Heading 4408 defines "sheets of veneering" as being not more than 6 mm in thickness, which indicates that a veneer for purposes of Heading 4412 must also be less than 6 mm. Here, the facing layer exceeds 6 mm and, therefore, is not a veneer.

Plaintiff relied on a prior decision of the Federal Circuit called Boen defining plywood construction for purposes of Heading 4412. That case defined plywood, but did not address the meaning of veneer.  Consequently, the CIT was not moved to follow it.

That leaves open the question of whether the merchandise is "similar laminated wood." On this, the CIT was also unconvinced. The Explanatory Notes define similar laminated wood as:


[1] Blockboard, laminboard and battenboard, in which the core is thick and composed of blocks, laths or battens of wood glued together and surfaced with the outer plies. Panels of this kind are very rigid and strong and can be used without framing or backing.


[2] Panels in which the wooden core is replaced by other materials such as a layer or layers of particle board, fibreboard, wood waste glued together, asbestos or cork.

On this point, the plaintiff failed to prove that the core of the product was blocks, laths, or battens glued together. That precludes classification under the first definition of "similar laminated wood." Similarly, because the cores are wood, and not some other material, the merchandise did not fit the second meaning of similar laminated wood.

There is not much more to say about this case. If there is an issue for appeal, it strikes me that the CIT read the Explanatory Notes definition of "similar laminated wood" as exclusive, which seems contrary to the broad meaning of the term "similar." If the heading were intended to cover only those two categories of "similar" products, the HTS language should say so. This reading of the notes seems to add a limitation that is not otherwise there. That is a no no, at least according to the Federal Circuit. 



Comments

Post a Comment

Popular posts from this blog

CAFC Decision in Double Invoicing Case

The Federal Circuit has issued a decision on the merits in United States v. Inn Foods, Inc.  There had been a previous decision on jurisdiction, which was followed by a trial at the Court of International Trade and then this appeal on the substance. The initial issue is whether Inn Foods' invoicing practice amounts to fraud.  Inn Foods had been receiving an invoice from growers in Mexico that had a relatively low sales prices on it.  Subsequent to entry, Inn Foods created a second invoice at something more similar to market value, retaining the original invoice number, and paid at that higher amount.   Superficially, this looks like a standard-issue double-invoicing scheme.  But, in the age of reconciliation, is it really more like a provisional pricing mechanism?  It might have been possible to make that argument had Inn Foods adjusted its entries accordingly.  It didn't and the loss of revenue was approximately $624,000.  Based on testimony and evidence indicating both knowl
Read more

Ruling of the Week 2015.8: Old Jersey and Pitcairn Island

Image
For today's ROTW, I set out looking for a ruling dealing with some far off and preferably warm location. Turns out that, with the exception of coastwise transit issues, there are no Customs and Border Protection rulings involving Pitcairn Island or any of several Pacific Ocean microstates including Tuvalu , Niue , and Kiribati . Pitcairn Island What I did find is an interesting question about the country of origin marking for products of the Bailiwick of Jersey Island, Channel Islands. The ruling is HQ 561938 (Mar. 18, 2002). For those of you who may not know, Jersey is an island off the coast of Normandy, France. It is an independent international actor and not part of the U.K. although the U.K. is responsible for its defense and external relations. Also, the Queen is the Head of State in her capacity as "the Crown in Right of Jersey." It is, according to the U.S. Department of State, a " Crown Dependency " along with the Isle of Man and the Bailiwick o
Read more

Ninestar and UFLPA Exhaustion

Image
Exhaustion is a key doctrine in administrative law. When applicable, it requires that a party unhappy with an agency’s determination complete the administrative appeal process before turning to the courts for judicial review. Requiring exhaustion typically promotes judicial efficiency by ensuring that disputes are resolved at the agency and, if they are not, that there is a complete record of the agency process. Exhaustion also ensures that the judiciary respects the executive agencies and their expertise.  There are, on the other hand, times when the courts will find that exhaustion is not necessary or appropriate. Such is the case in  Ninestar Corporation et al. v. United States  et al., a decision of the U.S. Court of International Trade.  Ninestar is also interesting because it is one of the first cases in the CIT involving the Uyghur Forced Labor Prevention Act, known as UFLPA. In my hiatus from active blogging, I missed the rise of UFLPA as a major compliance topic. So, let's
Read more