Berwick Industries, Inc. v. United States , 30 Ct. Int'l Trade 337 ( 2006 )

Slip Op. 06 -41
UNITED STATES COURT OF INTERNATIONAL TRADE
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BERWICK INDUSTRIES, INC., :
Plaintiff, :
v. : Court Nos. 96-01-00263
98-12-03189
THE UNITED STATES, :
Defendant. :
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Memorandum & Order
[Upon classification of certain decorative bows,
cross-motions for summary judgment denied.]
Dated: March 31, 2006
Neville Peterson LLP (John M. Peterson, Maria E. Celis,
Catherine Chess Chen and Laura Martino) for the plaintiff.
Peter D. Keisler, Assistant Attorney General; Barbara S.
Williams, Attorney in Charge, International Trade Field Office,
Commercial Litigation Branch, Civil Division, U.S. Department of
Justice (Mikki Graves Walser); and Office of Assistant Chief
Counsel, International Trade Litigation, U.S. Customs and Border
Protection (Sheryl A. French), of counsel, for the defendant.
AQUILINO, Senior Judge: The above-named plaintiff
importer1 commenced civil action 96-01-00263 as a test case
pursuant to USCIT Rule 84(b) to challenge classification by the
U.S. Customs Service of certain bows upon entry from the People's
Republic of China under either heading 3926 of the Harmonized
1
Now known as Berwick Offray, L.L.C.
Court Nos. 96-01-00263, 98-12-03189 Page 2
Tariff Schedule of the United States ("HTSUS") as "other articles
of plastics" or heading 6307 as "other made up [textile]
articles", dutiable at 5.3 or 7 percent ad valorem, respectively.
Plaintiff's complaint is that that merchandise more appropriately
landed under HTSUS heading 9505, "festive articles", and
therefore should have been duty free upon entry into the United
States. Defendant's answer disagrees with this position.
I
Following that joinder of issue, the plaintiff
interposed a motion to enlarge the time for the action to remain
on the reserve calendar pursuant to USCIT Rules 7 and 84, which
motion was granted on the ground that the parties were
"discussing the method in which the issues of the . . . action
may best be resolved in an effort to conserve judicial
resources". Plaintiff's Motion to Enlarge Time in Which Action
May Remain on Reserve Calender, second page. Some two years
later, the court requested that counsel apprise it of the
matter's status. When another year and a half had passed, the
court was constrained to inquire "why the above test case should
not be dismissed . . . pursuant to USCIT Rule 41(b)". Plain-
tiff's counsel responded that they
Court Nos. 96-01-00263, 98-12-03189 Page 3
had refrained from active litigation of this matter
pending final resolution of the Park B. Smith case, to
determine if the resolution of that case might be
dispositive of the classification of its Trim Time
bows. While plaintiff believes that the Federal
Circuit's decision in Park B. Smith[, Ltd. v. United
States, 347 F.3d 922 (Fed.Cir. 2003),] favors its view
regarding the tariff classification of Trim Time Bows,
it does not appear that that decision will be
dispositive of the classification of its merchandise.
Furthermore, [the] Park B. Smith appellate
decision is not yet final. The Federal Circuit is, as
of this writing, considering a petition for recon-
sideration submitted in that case . . .. The Federal
Circuit has remanded the matter to this Court, with
directions for the Court to make further findings with
respect to the merchandise there at bar.
Accepting this explanation, the court granted plaintiff's request
for a scheduling conference, which was held shortly thereafter.
The parties were in agreement that the Federal
Circuit's denial of plaintiff's petition for reconsideration in
Park B. Smith effectively cleared the way for disposition of this
test case. The court also inquired as to the status of
plaintiff's seemingly-related action, CIT No. 98-12-03189, to
which the plaintiff intimated the possibility of consolidation.
That initial reaction apparently faded prior to the
drafting of the parties' proposed scheduling order, which
continued to treat the two actions separately. The court
Court Nos. 96-01-00263, 98-12-03189 Page 4
thereupon expressed its "displeasure over the lack of any pro-
posal with regard to final disposition of CIT No. 98-12-0[31]89",
and it also inquired "whether or not that void c[ould] be filled
via default judgment". In response thereto, the plaintiff sub-
mitted a proposed scheduling order for that action.
Nonetheless, the undersigned remains uncertain why the
parties have not consolidated or suspended the later-commenced
action with (or in the light of) the earlier-initiated test case.
To borrow plaintiff's own words, "judicial resources can best be
conserved by avoiding active litigation of multiple suits dealing
with the same issue". Here, not only does the subject matter
seem to be the same, so too the underlying legal issue, namely,
whether plaintiff's merchandise should have been classified under
HTSUS heading 9505 as "festive articles". Compare Complaint No.
98-12-03189 . . .
12. The festive bows: Veltex Perfect, Perfect
Netting, and Trim-Time Bows are colored red, gold,
silver, and tartan plaid, which are colors evocative of
the Christmas season.
13. The festive bows are primarily ornamental in
nature.
14. The festive bows are intended to be displayed
and used during the Christmas holiday season, and are
designed to contribute to the joy and festivity of the
holiday.
Court Nos. 96-01-00263, 98-12-03189 Page 5
15. Because they are designed and manufactured
for the Christmas holiday season, the Veltex Perfect,
Perfect Netting, and Trim-Time Bows are properly
classifiable under HTS Subheading 9505.10.2500, as
festive articles, specifically as articles for
Christmas festivities: Christmas ornaments, other,
other; or under HTS Subheading 9505.90.6000, as festive
articles, specifically as other festive articles,
other, other. Under these subheadings, these bows are
entitled to enter the United States unconditionally
free of duty. As products of the People's Republic of
China, these festive bows are entitled to enter the
United States without regard to any textile quota
restrictions, and without the presentation at the time
of entry of any textile visas. Customs erred in
classification of such bows under HTS Subheadings
3926.40 or 6307.90.99. . . .
with Complaint No. 96-01-00263 . . .
5. The merchandise which is the subject of this
case consists of certain "perfect bows" and "trim time"
bows for festive occasions, which plaintiff imported
into the United States at the Port of Newark, New
Jersey.
6. The perfect bows are composed of textile
materials, and are designed specifically for use as
Christmas ornaments. The "trim time" bows are composed
of polypropylene plastics materials, and polypropylene
netting, and are specifically designed for use as
festive articles, to be displayed in connection with
certain holidays and festive occasions.
* * *
14. The plastic and textile bows are properly
classifiable under HTS subheading 9505.10.25, as
"Festive, carnival or other entertainment articles,
including magic tricks and practical joke articles;
parts and accessories thereof; Articles for Christmas
festivities and parts and accessories thereof;
Christmas ornaments; Other", and are entitled to enter
the United States unconditionally duty free.
Court Nos. 96-01-00263, 98-12-03189 Page 6
15. Alternatively, the plastic and textile bows
are properly classifiable under HTS subheading
9505.90.60, as "Festive, carnival or other enter-
tainment articles, including magic tricks and practical
joke articles; parts and accessories thereof; Other:
Other:[",] and are entitled to enter the United States
unconditionally duty free.
Given the foregoing, and in an effort to adhere to the principles
set forth in USCIT Rule 1, the court will henceforth consider the
above-numbered actions as if they have been consolidated. See
USCIT Rule 42(a):
When actions involving a common question of law or
fact are pending before the court, . . . it may order
all the actions consolidated . . .; and it may make
such orders concerning proceedings therein as may tend
to avoid unnecessary costs or delay.
A
Indeed, the plaintiff has now interposed a motion for
summary judgment accompanied by a required Statement of Material
Facts Not in Dispute2 combining the two actions, to wit:
A. Procedural History for Case Number 96-00263
1. From January 1995 through February 1995 and
from July 1997 through September 1997, plaintiff
imported the subject festive bows into the United
States from the People's Republic of China.
2
Complete capitalization deleted.
Court Nos. 96-01-00263, 98-12-03189 Page 7
2. Beginning January 1995 through February 1995,
plaintiff entered the subject bows under cover of
Newark, New Jersey Consumption Entries, 743-0053169-1,
743-0053251-7, 743-0053318-4, and 743-0053023-0. These
entries liquidated in May and June of 1995.
3. Defendant[] U.S. Customs . . ., . . . clas-
sified the subject bows at liquidation under Sub-
headings 3926.40.00, 3926.90.9890, and 6307.90.99 of
the . . . HTSUS[]. Subheading 3926.40.0000 described,
"Other articles of plastics and articles of other
materials of headings 3901 to 3914: Statuettes and
other ornamental articles," and goods that are
classified therein are subject to a 5.3% import duty ad
valorem. Subheading 3926.90.9890 described, "Other
articles of plastics and articles of other materials of
headings 3901 to 3914: Other:Other:Other," and imposes
an import duty of 5.3% ad valorem on goods that are
classified as such. Subheading 6307.90.99 described
"Other made up articles, including dress patterns:
Other: Other: Other: Other: Other." Goods entered
under this subheading were subject to a textile quota
and an import duty of 7% ad valorem.
4. On June 21, 1995, Berwick filed Protest number
1001-95-105544 objecting to the classification and duty
assessed at the liquidation of the subject entries, and
claiming classification under HTSUS Subheading
9505.10.2500, as "Festive, carnival or other
entertainment articles . . . .: Articles for Christmas
festivities and parts and accessories thereof: Christ-
mas ornaments: Other" or under HTS Subheading
9505.90.6000, as "Festive, carnival or other enter-
tainment articles . . [.]:Other: Other," enterable duty
free.
5. On August 18, 1995, Customs denied Berwick's
Protest . . .. On January 23, 1996, Berwick timely
commenced case number 96-01-00263 before the Court of
International Trade.
6. All duties were tendered prior to the
commencement of this action.
Court Nos. 96-01-00263, 98-12-03189 Page 8
B. Procedural History for Case No. 98-[]03189
7. From July 1997 through September 1997, plain-
tiff entered the subject merchandise under cover of New
York Consumption Entries, 743-0060717-8, 743-0061145-1,
743-0061243-4, 743-0061188-1, 743-0061283-0, and 743-
0060859-8. Customs liquidated these entries between
May and July 1998, and classified the merchandise under
HTS Subheadings 3926.40, and 6307.90.89, as other
plastic articles and other made-up textile articles.
8. On August 18, 1998, Berwick filed a protest
1001-98-103164 objecting to the classification and duty
assessed at liquidation of the subject entries and
claiming classification under HTSUS Subheading
9505.10.2500, as "Festive, carnival or other enter-
tainment articles . . . .: Articles for Christmas
festivities and parts and accessories thereof:
Christmas ornaments: Other" or under HTS Subheading
9505.90.6000, as "Festive, carnival or other
entertainment articles . . [.]: Other: Other,"
enterable duty free.
9. On November 27, 1998, Customs denied Berwick's
Protest . . . against the classification of festive
bows on the ground that Customs' classification was
correct. Plaintiff Berwick timely commenced case
number 98-12-03189 before the Court of International
Trade on December 2, 1998.
10. All duties were tendered prior to the
commencement of this action.
C. Description of Merchandise
11. Plaintiff's imported merchandise that are the
subject of this action consist[] of three types of
festive bows. Each bow manifests a decorative scheme
consistent with the Christmas holiday season. The
Perfect Bow is a festive bow that is flocked with
acrylic on the front surface to give it a velvet
texture and, once assembled, boasts fourteen (14) to
twenty (20) loops. At retail, these bows are arranged
Court Nos. 96-01-00263, 98-12-03189 Page 9
within a green box in a festive display of green,
plaid, and red. The Holiday Classic Bow is long, by
design so that it can be extended vertically across a
Christmas wreath or dangled gracefully from a mantle.
Like the Perfect Bow, the Holiday Classic Bow is
flocked with acrylic to give it a festive velvet
texture, a characteristic associated with the Christmas
holiday. The typical red large Holiday Classic Bow,
made from a material ex as "Veltex," is designed to be
used on a Christmas wreath, or hanging, unaccompanied,
from a store window or the doorpost of a home. The
Trim-Time Bow is an intricately designed bow with a
large size tie at its center. This Christmas bow is
sold exclusively in Berwick's Trim-A-Tree Line through
Trim-A-Tree line departments at retail stores and
special holiday retailers.
12. The Perfect Bow, Holiday Classic Bow, and
Trim-Time Bows are designed, sold as and used as
holiday decorations for home and commercial
furnishings. The bows are principally used as holiday
decorations for wreaths, Christmas trees, mantels,
walls, and window-sills in addition to a variety of
other holiday-related uses. The bows are sold in
traditional Christmas colors like, red, gold, tartan
plaid, silver and are sold exclusively during the
Christmas season.[3] All of these bows feature a cord or
tie at the center of the back of the bow, in order for
the bow to be easily hung, by nail or thread, as an
ornament or decoration. The subject items do not
include adhesive material, tape, or any other means by
which they may be affixed to objects.
13. As noted, the subject bows are principally
designed for the purpose of creating a festive bow used
3
Upon inquiry by the court at oral argument, plaintiff’s
counsel stated that there were no “white” bows at issue herein.
Nonetheless, the physical exhibits provided by the defendant in
Attachment A to the Supplemental Declaration of Joan Mazzola,
specifically, items numbered PF3, PFN9, PFN40, PFR9, appear to be
white or a variation thereof. See also Plaintiff's Statement of
Material Facts Not in Dispute, para. 14; Plaintiff’s Attachment B-
4, unnumbered third, seventh and eleventh pages.
Court Nos. 96-01-00263, 98-12-03189 Page 10
for decorating a home or commercial space during the
Christmas season. As such, the bows are made of either
extruded polypropylene or wire-edged woven textile,
fibers that, although sturdy, allow for more creative
freedom than wood or steel. These materials are also
water resistant, which allow them to be used as
decorations outside the home. Further, the durability
and weightlessness of these fabrics allow the
decorative bows to be easily stored and re-used during
subsequent holiday seasons.
The Perfect Bow
14. The Perfect Bow, depicted at Exhibit A, is
designed primarily for the purpose of creating a
festive bow that is used to decorate a home or
commercial space during the Christmas season. It
includes two strips that may be pulled to produce a bow
with fourteen (14) to twenty (20) loops, an amount that
far surpasses the number of loops in an ordinary,
disposable ribbon. This bow is about 2" - 8" long,
features ribbon about 2 inches wide, and is available
in colors such as white, red, gold, silver, emerald,
copper, navy, and champagne. The bow is made of Veltex
which is extruded polypropylene with a flocked front
surface. The flocked polypropylene gives the surface a
heavy velvet appearance, which increases aesthetic
appeal and facilitates the bow's use during the
potentially harsh weather of December. The Veltex
material also increases durability, which keeps the bow
intact during use through the Christmas season, while
in storage, and during subsequent holiday seasons.
15. Berwick's retail packages instruct that the
Perfect Bow may be used for "Christmas trees," "home
decorating," and "wreaths." Thus, the ultimate
consumer would expect to use the article to create a
Christmas ambiance in the home or store, by hanging it
directly upon a house fixture, or by accessorizing a
Christmas tree or wreath. Again, Berwick's retail
display box for the Perfect Bow is green and the bows
are arranged in a festive display of green, plaid, and
red designs. Berwick's bows are sold in seasonal
Court Nos. 96-01-00263, 98-12-03189 Page 11
sections of general merchandise and craft stores, as
well as the holiday catalogs of Berwick.
Holiday Classic Bows
16. The Holiday Classic Bows, shown at Exhibit B,
are designed primarily for use as festive decorations
during the celebration of Christmas, in the home or
business. This festive bow ranges in size from 3" -
22" long and 3" - 10" wide. Berwick fashioned its
design to create a proportional fit with a Christmas
wreath or tree. These bows feature two (2) to seven
(7) loops and are available in red, green, gold, sil-
ver. Some bows depict images largely associated with
Christmas, such as candy-cane stripes, hollies, etc.
These bows are made from polypropylene ribbon, i.e.
Veltex, plus acetate satin, vinyl, or PET/Polyester
"Supersilk" material. Like the Perfect Bow, the Holi-
day Classic Bow was designed with a flocked polypropy-
lene to give the surface a heavy velvet appearance, a
design characteristic that increases aesthetic appeal
and allows it to withstand the inclement weather if
used to decorate the outside of a home during the win-
ter months. The Veltex material also increases dura-
bility, which keeps the bow intact for use during the
Christmas season, while in storage, and during subse-
quent holiday seasons.
17. The advertising brochure, at Exhibit B, de-
picts several uses for the Holiday Classic Bow: a red
bow affixed to a wreath, hanging against an interior
wall; and two red bows affixed against a mantle, be-
neath a green wreath. Advertised on the retail pack-
ages are the words, "Home Decorating." It follows that
the ultimate purchasers of the bows would expect to use
them as festive decorations. Their channels of trade
include seasonal sections of general merchandise and
craft stores, as well as Berwick's holiday catalogs.
Trim-Time Bows
18. The Trim-Time Bows, depicted at Exhibit C,
are designed to be tied to home fixtures, e.g. mantles,
Christmas trees, etc. and are typically use[d] with
Court Nos. 96-01-00263, 98-12-03189 Page 12
other festive decorations to bolster the spirit of the
Christmas season. The Trim-Time Bows are highly deco-
rative festive bows which are approximately 5" - 20"
wide, 8" - 20" long, and feature intricately designed
ribbons and ties. These bows are made of wire-edged
woven textile and incorporate traditional Christmas
colors of red and green plus a tartan plaid. The wire
edges enable the bows to maintain their shape during
each and subsequent holiday season. They are available
in various colors like silver, gold, green, blue, bur-
gundy, and in a holly pattern – a quintessential symbol
of Christmas.
19. The Trim-Time Bows are sold exclusively as
holiday decorations for wreaths in Berwick's Trim-A-
Tree line to retail stores as well as special holiday
retailers. These items are sold in the seasonal sec-
tions or festive product sections of retail stores.
The ultimate purchaser would expect to use the bow as a
decoration during Christmas, given that the advertise-
ment on the Trim-Time Bow retail package . . .
describes the item as "Home Décor Bow" and suggests to
consumers the following uses: "On the Mantelpiece;"
"Over a Doorway;" "As a Centerpiece;" and "On a Win-
dow."
20. All of the subject bows are designed with two
fabric strips that allow the items to be easily tied to
wreaths, Christmas trees, or other fixtures as a hang-
ing home ornament. That the bows are not designed with
adhesive strips on the reverse-side preclude them from
being easily affixed to gifts or packages. All of
these bows are packaged on hanging cards with the term
"Home Decorating" or with instructions on how to con-
struct (for purposes of the Perfect Bow) or display the
bow. The cover of Berwick's 2000 catalogue includes a
photograph of its bows positioned on a platform, along
with a miniature Christmas tree sculpture, several
hanging holiday ornaments, poinsettias, and a figure
bearing a Christmas theme . . .. These items are mar-
keted as home decorating supplies in the holiday sec-
tions of supermarkets, craft stores, or department
stores.
Court Nos. 96-01-00263, 98-12-03189 Page 13
21. These bows are not intended to be used to
wrap or decorate packages, because they are designed to
be ornaments and big enough to decorate trees, rooms,
mantels, wreaths, etc. Furthermore, they are not rib-
bons which can easily be tied around a package. To
celebrate the Christmas Holiday, these bows are sold to
provide merriment as they decorate the home, churches,
storefronts, window displays, and all other areas re-
quiring Christmas cheer.
22. Since these bows (1) are intended for use,
(2) are used as ornaments and decorations during the
holidays, and (3) are marketed as such, the subject
merchandise should be classified under HTS Heading 9505
as festive articles.
Italics, boldface, and underscoring in original.
In its response, the defendant admits foregoing para-
graphs 2, 5, 6, 8, and 10 but denies in sum and substance all of
the others. It is, however, of some moment to emphasize defend-
ant's averments as to the following:
15. Denies. Avers that, according to Plaintiff's
Exhibit A, the Perfect Bow is "Great For Use On[] Bas-
kets, Christmas Trees, Crafts, Floral Arrangements,
Gift Packaging, Home Decor, [and] Wreaths." Further
avers that the Perfect Bow is depicted as a bow on a
gift box.
Holiday Classic Bows
16. Denies . . .. Avers that the pages depicting
bows in Plaintiff's Exhibit B do not refer to [] any
bows as "Holiday Classic Bows." Further avers that the
descriptions and dimensions of the articles depicted in
Exhibit B (on the page marked "40") provide that the
depicted articles are actually ribbons and not "bows"
Court Nos. 96-01-00263, 98-12-03189 Page 14
as alleged in this paragraph. Further avers that,
based on the item numbers corresponding to the bows
depicted, none of the bows depicted in Plaintiff's
Exhibit B are the subject of these actions.
17. Denies . . .. Further avers that the depic-
tion contained on the first page of Plaintiff's Exhibit
B merely states "Veltex" and there is no indication
that the articles depicted on that page are the arti-
cles at issue in these actions. Admits that retail
packages depicted in Plaintiff's Exhibit B state "Home
Decorating." . . .
Trim-Time Bows
18. Denies . . .. Avers that the depiction con-
tained in Plaintiff's Exhibit C merely state[s] "Golden
Shimmer" and do[es] not state "Trim-Time Bow." Further
avers that there is no indication that the articles
depicted in Plaintiff's Exhibit C are the articles at
issue in these actions.
19. Denies that the retail packages depicted in
Plaintiff's Exhibit C refer to the depicted articles as
“Trim-Time Bows"; admits that the retail packages de-
picted in Plaintiff's Exhibit C state "Home Decorat-
ing." . . .
B
This response has been served and filed in conjunction
with a cross-motion for summary judgment that contains defend-
ant's own Additional Statement of Material Facts As To Which
There Is No Genuine Issue To Be Tried4, the most pertinent of
which include:
4
Complete capitalization deleted.
Court Nos. 96-01-00263, 98-12-03189 Page 15
5. Berwick has limited its causes of action to
only those imported bows which are in the following
colors: red, green, gold[,] silver and tartan plaid
. . .. Therefore, it has abandoned its claims regard-
ing all [other] bows contained in the entries.
* * *
6. Berwick has seven product retail divisions for
the bows which it manufactures and sells: Christmas
Retail, Trim Time Retail, Everyday Retail, Floral
Wholesale, Craft Retail, Packaging Wholesale, and Cus-
tom. . . . These divisions cross-merchandise and mar-
ket bows of a variety of materials, colors, and styles,
i.e., bows sold in one division are also advertise[d]
and sold through other divisions. . . .
7. Berwick's Christmas Retail Division offers
product lines, such as Christmas Classic, Brilliance
and Ribbon Magic, which sell ribbons and bows for
Christmas packaging. . . .
8. Berwick's Trim Time Retail division offers bows
for every decorating need and offers in color themes
that trend with the home decor market. . . .
9. Berwick's Everyday Retail Division offers cre-
ative options for both gift packaging and party decor
in a variety of colors, and these bows are similar to
the bows in Berwick's Christmas Retail division. . . .
Bows sold through this division are used for gift wrap,
gift bags, balloons and party supplies. . . .
10. Berwick's Floral Wholesale division supports
the floral distributors market. Berwick's Flora-Satin
product category is offered through this retail divi-
sion for every occasion. . . .
11. Berwick's Craft Retail division offers a wide
range of bows designed to accessorize any craft pro-
ject, "regardless of the season." The bows sold to the
craft market include Veltex, Flora-Satin (printed and
solid), Wraphia, curling ribbon, Perfect Bows, and Curl
Swirls. . . .
Court Nos. 96-01-00263, 98-12-03189 Page 16
12. As the world's largest manufacturer and dis-
tributor of decorative bows, Berwick sells bows year-
round. . . .
13. Bows are decorative articles manufactured,
marketed and sold year-round for a variety of purposes.
. . .
14. Bows are principally used in connection with
gift wrapping/packaging. . . .
15. Bows [are] made from a variety of material and
marketed in many colors and patterns through many chan-
nels of trade year-round. . . .
16. Bows have a variety of uses, e.g., decorating
gifts, houses, rooms, corsages, plants, hanging bas-
kets, floral arrangements, gift wrapping, pews and
centerpieces. . . .
17. The bows at issue are manufactured, imported,
marketed and sold in different colors.
18. Neither the styles, sizes, colors, nor other
characteristics of the imported bows preclude their use
as gift wrapping bows and/or at times of the year other
than Christmas. . . .
19. None of the commercial papers describe the
imported merchandise as being "Holiday Classic Bows."
Citations omitted.
In its response, the plaintiff admits paragraphs 16 and
17 but denies 5, 13-15, and 18. As for the others, the plain-
tiff:
6. Admits that Defendant's Exhibit 1 speaks for
itself. Denies the remaining allegations. Avers that
most of Berwick's Christmas bows are marketed during
Christmas and in specific catalogs.
Court Nos. 96-01-00263, 98-12-03189 Page 17
7. Admits and avers that the Christmas Retail
Division not only sells Christmas packaging but Christ-
mas decorations and ornament-like bows.
8. Admits and avers that Trim Time Bows at issue
are designed for use as Christmas decorations.
9. Denies and avers that most of the subject mer-
chandise is not offered in Berwick's Everyday Retail
Division for gift wrap, gift bags, balloons, and party
supplies. The Perfect Bow may be used for packaging
but is principally designed to be used for home or
other decor at such festive events as Christmas.
10. Admits and avers that the subject merchandise
is not generally sold through the Floral Wholesale
Division.
11. Admits and avers that the subject merchandise
is not generally sold through the Craft Retail Divi-
sion.
12. Admits and avers that plaintiff does not sell
most of the subject Christmas bows year-round.
19. Admits that the invoices and entry papers do
not mention "Holiday Classic Bows." However, avers
that all the 1996 and 1997 Christmas Catalogs, as well
as the packaging for the subject bows describe some of
the imported merchandise as "Holiday Classic Bows."
II
Both parties contend that the matter at bar can be
resolved via summary judgment. See, e.g., Memorandum of Points
and Authorities in Support of Plaintiff's Motion for Summary
Judgment ("Plaintiff's Memorandum"), p. 8; Memorandum in Opposi-
tion to Plaintiff's Motion for Summary Judgment and In Support of
Defendant's Cross-Motion for Summary Judgment ("Defendant's Memo-
Court Nos. 96-01-00263, 98-12-03189 Page 18
randum in Opposition"), p. 9. The court tested this thesis by
subjecting them to oral argument. Alas, upon careful review and
reflection, the court cannot concur. See, e.g., Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986):
. . . [S]ummary judgment will not lie if the dispute
about a material fact is "genuine," that is, if the
evidence is such that a reasonable jury could return a
verdict for the nonmoving party.
Jurisdiction to hear and decide this matter is predi-
cated upon 28 U.S.C. §1581(a) and §2631(a). The dispositive
issue herein is whether plaintiff’s bows are prima facie classi-
fiable as “festive articles” under HTSUS heading 9505. If so,
the contested classification would be erroneous on its face per
Note 2(v)5 of Chapter 39 and Note 1(t) of Section XI6, both of
which indicate that the tariff provisions thereunder do not cover
"[a]rticles of Chapter 95". See General Rule of Interpretation 1:
. . . [F]or legal purposes, classification shall be
determined according to the terms of the headings and
any relative section or chapter notes[.7]
5
Note 2(v) was formerly Note 2(u).
6
Chapter 63 falls thereunder.
7
"Section and Chapter Notes are not optional interpretive
rules, but are statutory law, codified at 19 U.S.C. §1202." Park
B. Smith, Ltd. v. United States, 347 F.3d 922, 926 (Fed.Cir. 2003)
(citation omitted). Cf. Midwest of Cannon Falls, Inc. v. United
States, 122 F.3d 1423, 1429 (Fed.Cir. 1997).
Court Nos. 96-01-00263, 98-12-03189 Page 19
A
To determine whether plaintiff’s bows are classifiable
under HTSUS heading 9505, the court must first ascertain the
meaning of that tariff provision. See, e.g., Rollerblade, Inc.
v. United States, 282 F.3d 1349, 1352 (Fed.Cir. 2002). That
inquiry is unnecessary herein as the meaning thereof, and more
specifically, the term “festive articles”, has been defined by
the Court of Appeals most recently in Russ Berrie & Co. v. United
States, 381 F.3d 1334, 1336 (Fed.Cir. 2004), quoting Park B.
Smith, Ltd. v. United States, 347 F.3d at 927, in turn citing
Midwest of Cannon Falls, Inc. v. United States, 122 F.3d 1423,
1429 (Fed.Cir. 1997), to wit:
. . . [C]lassification as a “festive article” under
Chapter 95 requires that the article satisfy two crite-
ria: (1) it must be closely associated with a festive
occasion and (2) the article is used or displayed prin-
cipally during that festive occasion.
In Russ Berrie, the court found that
[s]nowmen decorated with holly, ghosts, and witches'
and monsters' heads are symbols that are closely asso-
ciated with the Christmas and Halloween holidays and
are used principally on those occasions.
381 F.3d at 1336 (emphasis added). In Park B. Smith, the Federal
Circuit had stated that
articles with symbolic content associated with a par-
ticular recognized holiday, such as Christmas trees,
Court Nos. 96-01-00263, 98-12-03189 Page 20
Halloween jack-o-lanterns, or bunnies for Easter, are
festive articles[,]
but those
articles that might be associated with a particular
holiday because of their color schemes, but having no
symbolic content, such as a red and green plaid, do not
meet the . . . criteria for festive articles under
Chapter 95.
347 F.3d 929.
Given this meaning for “festive articles”, this court
can move to the second, factual inquiry articulated in Roller-
blade, 282 F.3d at 1352, namely, whether the goods at issue here-
in land within that meaning -- in other words, whether they sat-
isfy the criteria enumerated above.
(1)
In an attempt to satisfy number (1), supra, the plain-
tiff presents three arguments, the first of which is that
bows possess a historical association with Christmas.
Symbolically, bows reflect the "spirit of brotherhood,"
and their use during the Christmas season suggests that
humankind is "tied together with bonds of goodwill."
Plaintiff's Memorandum, p. 13, quoting Symbols of Christmas,
http://www.ywconnection.com/Holiday/pageHsymbolsofchristmas.html
(last visited March 31, 2006). This citation to an anonymous,
presumably-personal, website hardly reveals how the "spirit of
Court Nos. 96-01-00263, 98-12-03189 Page 21
brotherhood" is actually bound to Christmas, whether one consid-
ers that holiday in the light of either its religious8 origin or
its current commercial significance.
Secondly, the plaintiff claims that “[t]oday, the bow
is as ubiquitous a symbol of Christmas as the greenery it
decorates”. Plaintiff’s Memorandum, p. 13. This broad general-
ization seems to derive solely from the following sentence: “In-
deed, it is rare to see a Christmas wreath or garland without a
large bow.” Id. (citations omitted). While this could be true,
the relevance thereof seems to attach to the second requirement--
that the merchandise be used or displayed principally during a
festive occasion. See Russ Berrie & Co. v. United States, supra.
Third, the plaintiff argues that "some of the Holiday
Classic and Trim-Time bows display traditional Christmas symbols,
such as candy-cane stripes and holly"9, to which end it also pro-
vides Physical Exhibit #1 (Trim-Time)10 depicting what appear to
be holly branches. For support, counsel reference paragraphs 7
8
See, e.g., Skoros v. City of New York, 437 F.3d 1, 9-10, 28-
29 & n. 24, 51-52 (2d Cir. 2006).
9
Plaintiff’s Memorandum, p. 12, citing Tim Shearer Affir-
mation, paras. 7, 9. See also Russ Berrie & Co. v. United States,
381 F.3d 1334, 1336 (Fed.Cir. 2004).
10
Also displayed at the podium during oral argument.
Court Nos. 96-01-00263, 98-12-03189 Page 22
and 9 of the affirmation of Tim Shearer. Neither, however, sub-
stantiates that any of the bows at issue "displays traditional
Christmas symbols". Rather, paragraph 9, which discusses the
physical characteristics of Holiday Classic bows, merely states
that they "may feature patterns such as candy-cane stripes,
holly, etc.", while number 7 makes no mention of candy-cane
stripes, holly, or any other alleged traditional Christmas sym-
bol. Emphasis added. Cf. Defendant's Exhibit 10, Supplemental
Declaration of Joan Mazzola, para. 5:
. . . Physical Exhibit #1 . . . has what appears to be
a textile bow with a holly on it. However, I was not
aware that any of the bows at issue here contained
holly on them.
Nor does plaintiff's Attachment A, listing each bow individu-
ally by protest, entry, category, and item number, support such a
conclusion.
Despite this inconsistency, and the seemingly tenuous
evidence produced by the plaintiff as to the bows' being symbols
of Christmas, at this stage in the action(s) the court cannot
weigh that evidence or make credibility determinations with re-
gard thereto. See, e.g., Anderson v. Liberty Lobby, Inc., 477
U.S. at 255.
Court Nos. 96-01-00263, 98-12-03189 Page 23
(2)
Should the plaintiff be able to substantiate that
"closely associated” requirement at trial, it still must satisfy
the second -- that its goods are used or displayed principally11,
in other words, predominantly12 or ordinarily13, as festive deco-
rations during the Christmas holiday. Cf. Plaintiff's Memoran-
dum, pp. 14, 17-23; Plaintiff's Statement of Material Facts Not
in Dispute, paras. 12-22. Here, this contention is not without
challenge. Defendant's position is that the bows at issue are
11
See Additional U.S. Rule of Interpretation 1(a):
. . . [A] tariff classification controlled by use (other
than actual use) is to be determined in accordance with
the use in the United States at, or immediately prior to,
the date of importation, of goods of that class or kind
to which the imported goods belong, and the controlling
use is principal use[.]
Principal use has been defined as a use "which exceeds any other
single use". Lenox Collections v. United States, 20 CIT 194, 196
(1996) (italics in original).
12
See Warner-Lambert Co. v. United States, 28 CIT ___, ___,
341 F.Supp.2d 1272, 1281 (2004), aff'd, 425 F.3d 1381 (Fed.Cir.
2005), quoting Len-Ron Mfg. Co. v. United States, 334 F.3d 1304,
1311 (Fed.Cir. 2003).
13
See Primal Lite, Inc. v. United States, 182 F.3d 1362, 1364
(Fed.Cir. 1999).
Court Nos. 96-01-00263, 98-12-03189 Page 24
principally used in connection with gift-wrapping.14
In support of their respective positions and in
accordance with USCIT Rule 56(e), each party has submitted affi-
davits attesting to the principal use of the bows at issue.15
Those affidavits primarily focus on the factors outlined in
United States v. Carborundum Co., 63 CCPA 98, 102, C.A.D. 1172,
536 F.2d 373, 377, cert. denied, 429 U.S. 979 (1976). See
Plaintiff's Memorandum, pp. 17-23; Defendant's Memorandum in
Opposition, pp. 20-26. Having studied those affidavits, namely,
of Alice Wong and Joan Mazzola for the defendant; and of Tim
Shearer, Bruce Kerr, and Stella Troman for the plaintiff, the
14
See Defendant's Memorandum in Opposition, pp. 19-26;
Defendant’s Additional Statement of Material Facts As To Which
There Is No Genuine Issue To Be Tried, paras. 7, 9, 13-14, 18;
Defendant's Exhibit 10, Supplemental Declaration of Joan Mazzola,
para. 6:
. . . Bows are decorative articles used as a part of
packaging, i.e., gift-wrapping. For example, tissue
paper is used in packaging as decoration and/or to
protect the packaged article, but is not itself a
package. Plastic sheets, which are often used in place
of tissue paper, are likewise not a package but are used
as part of the packaging system to protect the packaged
article. Similarly, bows are not themselves packages,
but are used in the process of packaging, including gift-
wrapping.
15
Their positions were also well articulated by counsel at
oral argument.
Court Nos. 96-01-00263, 98-12-03189 Page 25
court is unable to reconcile the competing statements16 contained
therein without a trial where the aforementioned affiants can be
subjected to cross-examination, "which has been said to be the
surest test of truth and a better security than the oath."
Hanover Ins. Co. v. United States, 25 CIT 447, 458 (2001).
III
In view of the foregoing, the parties' cross-motions
for summary judgment must be, and they hereby are, denied. Coun-
sel are directed to confer and propose to the court on or before
April 28, 2006 a schedule for trial of those issue(s) of fact
16
Compare, e.g., Defendant's Exhibit 10, Supplemental
Declaration of Joan Mazzola, para. 8:
. . . Based on the advertising and sales practices of
. . . retailers, it is my opinion that bows, including
the perfect bows and other bows at issue in this action
. . . belong to a class or kind of bow that is
principally used for packaging, including gift-
wrapping[,]
with Plaintiff's Memorandum in Opposition, Affirmation of Bruce
Kerr, para. 13:
. . . [T]hese bows are sold principally during the
Christmas holiday season to decorate all manner of public
and private spaces, including homes, churches, and
storefronts.
Court Nos. 96-01-00263, 98-12-03189 Page 26
which are not already agreed to herein and which cannot be stipu-
lated to in a pretrial order.
So ordered.
Dated: New York, New York
March 31, 2006
Thomas J. Aquilino, Jr.
Senior Judge