The Gerson Co. v. United States , 254 F. Supp. 3d 1271 ( 2017 )

Slip Op. 17-96
UNITED STATES COURT OF INTERNATIONAL TRADE
THE GERSON COMPANY,
Plaintiff,
Before: Timothy C. Stanceu, Chief Judge
v.
Court No. 11-00225
UNITED STATES,
Defendant.
OPINION
[Determining, upon cross-motions for summary judgment, the tariff classification of certain
imported candle-like articles containing light-emitting diodes]
Date: August 2, 2017
Ralph H. Sheppard, Meeks, Sheppard, Leo & Pillsbury, of Fairfield, CT, for plaintiff The
Gerson Company. With him on the brief was Robert J. Leo.
Amy M. Rubin, Assistant Director, International Trade Field Office, Civil Division, U.S.
Department of Justice, of New York, NY, for defendant United States. With her on the brief
were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, and Hardeep K. Josan,
Trial Attorney. Of counsel on the brief was Sheryl A. French, Office of Assistant Chief Counsel,
U.S. Customs and Border Protection.
Stanceu, Chief Judge: In this action to contest the denials of its administrative protests by
U.S. Customs and Border Protection (“Customs”), plaintiff The Gerson Company (“Gerson”)
contests the tariff classification Customs determined for certain imported articles that resemble
candles and that use as a source of illumination internal, battery-powered light-emitting diodes.
Before the court are cross motions for summary judgment. The court awards summary
judgment in favor of defendant United States.
Court No. 11-00225 Page 2
I. BACKGROUND
Gerson was the importer of record on 27 entries of the merchandise at issue in this
litigation. Summons (June 30, 2011), ECF No. 1. The entries were made during the period of
January 6 through October 16, 2009, at the Port of Kansas City, Missouri. Id. Customs
liquidated the entries between November 20, 2009 and September 3, 2010, inclusive, and Gerson
contested the liquidations by filing four protests, on May 12, June 8, August 31, and
September 14, 2010, respectively. Id. Customs denied all four protests on January 4, 2011, and
this action followed.
Plaintiff moved for summary judgment in July 2016; defendant filed its cross motion the
following November. Pl.’s Br. and Exs. in Supp. of its Mot. for Summ. J. (July 15, 2016),
ECF No. 43-2 (“Pl.’s Mot.”); Def.’s Mem. of Law in Opp’n to Pl.’s Mot. for Summ. J. and in
Supp. of Def.’s Cross-Mot. for Summ. J. (Nov. 4, 2016), ECF No. 53 (“Def.’s Mot.”). 1
II. DISCUSSION
A. Jurisdiction and Standard of Review
The court exercises jurisdiction pursuant to 28 U.S.C. § 1581(a) (2006), according to
which the court has jurisdiction over an action brought under section 515 of the Tariff Act
of 1930 (“Tariff Act”), as amended, 19 U.S.C. § 1515 (2006), to contest a denial of a protest by
Customs. In such an action, the court proceeds de novo. See Customs Courts Act of 1980 § 301,
28 U.S.C. § 2640(a)(1) (2006).
1
The court held a telephonic conference with the parties on July 18, 2017, during which
plaintiff waived its prior request for oral argument.
Court No. 11-00225 Page 3
B. Description of the Merchandise
The facts as stated in this Opinion are not in dispute between the parties. See Agreed
Statement of Facts (July 15, 2016), ECF No. 43-1; Def.’s Resp. to Pl.’s Agreed Statement of
Facts (Nov. 4, 2016), ECF No. 53-1.
The merchandise at issue consists of various models of what Gerson terms “candles” and
“tea lights.” 2 Pl.’s Mot. 5. Each of these articles is comprised principally of translucent wax or
plastic and is made to resemble a style of an ordinary candle (such as a votive, pillar, taper, or tea
light). Id. Instead of providing illumination by means of a wick and the combustion of candle
wax, as does an ordinary candle, each of these articles provides illumination by means of an
internal semiconductor that is a “light-emitting diode,” or “LED,” powered by a battery
contained within the article. Id. Catalogue illustrations of the articles show that when the LED
is energized by the battery, the illuminated article resembles a lit candle. See Pl.’s Mot., Ex. 3c,
ECF No. 43-7. The illustrations also show that Gerson’s articles provide decoration as well as
illumination and that some are in holiday themes, including Christmas. See id.
C. Tariff Classification under the General Rules of Interpretation, HTSUS
Tariff classification is determined according to the General Rules of Interpretation
(“GRIs”), and, if applicable, the Additional U.S. Rules of Interpretation (“ARIs”), of the
Harmonized Tariff Schedule of the United States (“HTSUS”). GRI 1 directs that tariff
classification, in the first instance, “be determined according to the terms of the headings and any
2
A “tea light” is “a small round candle in a disposable metal container.” Dictionary.com,
http://www.dictionary.com/browse/tea-light (last visited July 25, 2017).
Court No. 11-00225 Page 4
relative section or chapter notes.” GRI 1, HTSUS (2009). 3 Once merchandise is determined to
be correctly classified under a particular heading of the HTSUS, a court then looks to the
HTSUS subheadings to determine the correct classification of the merchandise in question.
GRI 6, HTSUS; see Orlando Food Corp. v. United States, 140 F.3d 1437, 1440 (Fed. Cir. 1998).
Unless there is evidence of “contrary legislative intent, HTSUS terms are to be construed
according to their common and commercial meanings.” La Crosse Tech., Ltd. v. United States,
723 F.3d 1353, 1358 (Fed. Cir. 2013) (“La Crosse”) (quoting Carl Zeiss, Inc. v. United States,
195 F.3d 1375 (Fed. Cir. 1999)). Although not binding law, the Explanatory Notes (“ENs”) to
the Harmonized Commodity Description and Coding System (“Harmonized System” or “HS”),
maintained by the World Customs Organization, “may be consulted for guidance and are
generally indicative of the proper interpretation of a tariff provision.” 4 Degussa Corp. v. United
States, 508 F.3d 1044, 1047 (Fed. Cir. 2007).
In cases involving a disputed tariff classification, the court first considers whether “the
government’s classification is correct, both independently and in comparison with the importer’s
alternative.” Jarvis Clark Co. v. United States, 733 F.2d 873, 878 (Fed. Cir. 1984). Plaintiff has
the burden of showing the government’s determined classification to be incorrect. Id. at 876. If
plaintiff meets that burden, the court has an independent duty to arrive at “the correct result, by
whatever procedure is best suited to the case at hand.” Id. at 878.
3
Because all entries of the merchandise at issue occurred in 2009, all citations herein to
the Harmonized Tariff Schedule of the United States (“HTSUS”) are to the 2009 version of the
HTSUS.
4
All citations to the World Customs Organization’s Harmonized Commodity Description
and Coding System (“HS”) Explanatory Notes (“ENs”) contained herein are to the 2007 version.
Court No. 11-00225 Page 5
D. Summary Judgment under USCIT Rule 56
The court will award summary judgment “if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
USCIT R. 56(a). In a tariff classification dispute, “summary judgment is appropriate when there
is no genuine dispute as to the underlying factual issue of exactly what the merchandise is.”
Bausch & Lomb, Inc. v. United States, 148 F.3d 1363, 1365 (Fed. Cir. 1998). In ruling on a
summary judgment motion, the court credits the non-moving party’s evidence and draws all
inferences in that party’s favor. Hunt v. Cromartie, 526 U.S. 541, 552 (1999) (citing Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) (“Anderson”)). A genuine factual dispute is one
potentially affecting the outcome under the governing law. Anderson, 477 U.S. at 248.
In this case, the court concludes that there are no disputed facts material to the tariff
classification of Gerson’s merchandise.
E. Contentions of the Parties
Upon liquidation, Customs classified the imported articles in subheading 9405.40.80,
HTSUS (“Lamps and lighting fittings including searchlights and spotlights and parts thereof, not
elsewhere specified or included; . . . : Other electric lamps and lighting fittings: Other”), subject
to duty at 3.9% ad val. In its cross motion for summary judgment, defendant argues that the
classification as determined by Customs upon liquidation was correct. Def.’s Mot. 3.
Before the court, plaintiff’s primary claim is that the merchandise is properly classified in
subheading 8543.70.70, HTSUS (“Electrical machines and apparatus, having individual
functions, not specified or included elsewhere in this chapter; . . . : Other machines and
apparatus: Electric luminescent lamps”), subject to duty at 2% ad val. Pl.’s Mot. 1.
Court No. 11-00225 Page 6
Plaintiff claims in the alternative that the articles at issue are classifiable in subheading
8543.70.96, HTSUS (“Electrical machines and apparatus, having individual functions, not
specified or included elsewhere in this chapter; . . . : Other machines and apparatus: Other:
Other: Other”), subject to duty at 2.6% ad val. Id.
As a third alternative, plaintiff claims classification in subheading 8541.40.20, HTSUS
(“ . . . light-emitting diodes: light-emitting diodes (LED’s)”), free of duty. Id.
As a fourth alternative, plaintiff argues for classification in subheading 8541.50.00
(“Diodes, transistors and similar semiconductor devices; . . . : Other semiconductor devices”),
free of duty. Id.
F. Application of GRI 1, HTSUS, to Determine the Correct Heading of the HTSUS
Because GRI 1, HTSUS directs that classification be determined, in the first instance,
“according to the terms of the headings and any relative section or chapter notes,” the court first
considers the candidate headings identified by the parties and any additional headings that might
merit consideration. The candidate HTSUS headings, shown in numerical order and with the
heading terms relevant to the classification issue presented by this case, are as follows:
8541 Diodes, transistors and similar semiconductor devices; . . . light-emitting
diodes; . . .
8543 Electrical machines and apparatus, having individual functions, not specified or
included elsewhere in this chapter; . . .
9405 Lamps and lighting fittings including searchlights and spotlights and parts thereof,
not elsewhere specified or included; . . .
As GRI 1, HTSUS requires, the court also considers “relative section or chapter notes.”
Considering these notes and the HTSUS headings in general, the court concludes that there are
Court No. 11-00225 Page 7
no other plausible candidate headings. 5 Therefore, the court will analyze three candidate
headings, two of which are in chapter 85 and one of which is in chapter 94, HTSUS.
Gerson’s articles, not being designed to be attached to another article or surface (as is a
lighting fixture), are not described by the term “lighting fitting” but fall within common
definitions of the word “lamp.” 6 Note 1(f) to Chapter 94, HTSUS provides that “[t]his
chapter [94] does not cover: . . . Lamps or lighting fittings of chapter 85.” The threshold
question, therefore, is whether Gerson’s “candles” and “tea lights” fall within the scope of
5
Certain of Gerson’s articles have decorative characteristics, and plaintiff’s exhibit, for
example, shows that many of them have holiday or festive themes (e.g., Christmas and
Halloween). Pl.’s Br. and Exs. in Supp. of its Mot. for Summ. J., Ex. 3c (July 15, 2016), ECF
No. 43-7. Neither party advocates classification under heading 9505, HTSUS (“Festive, carnival
or other entertainment articles . . .”), and the court concludes that classification thereunder would
be contrary to the intent of the drafters of the HS, who intended that durable articles such as
Christmas tree lights (“electric garlands”), even though performing a decorative as well as an
illuminating function, would fall outside the scope of that heading and within the scope of HS
heading 94.05. See EN 94.05 (instructing that “electric garlands,” including those fitted with
fancy lamps for carnival or entertainment purposes or for decorating Christmas trees, are within
the scope of HS heading 94.05); see also EN 85.05. In contrast, certain articles that may be
described as decorations “which in view of their intended use are generally made of non-durable
material” such as paper or metal foil, are classified under HS heading 95.05, even if containing
illumination. EN 95.05. Both EN 94.05 and EN 95.05 give as an example of the latter class of
goods “Chinese lanterns.”
The court also eliminates from consideration heading 3406, HTSUS (“Candles, tapers
and the like”) because the articles in question are not “candles” within the common meaning of
that term. See, e.g., Merriam Webster, www.merriam-webster.com/dictionary/candle (last
visited July 25, 2017) (“a usually molded or dipped mass of wax or tallow containing a wick that
may be burned (as to give light, heat, or scent or for celebration or votive purposes)”).
6
See, e.g, Merriam Webster, www.merriam-webster.com/dictionary/lamp (last visited
July 25, 2017) (“a: any of various devices for producing light or sometimes heat: such as (1): a
vessel with a wick for burning an inflammable liquid (such as oil) to produce light (2): a glass
bulb or tube that emits light produced by electricity (such as an incandescent light bulb or
fluorescent lamp) b: a decorative appliance housing a lamp that is usually covered by a shade”)
(emphasis added).
Court No. 11-00225 Page 8
chapter 85, HTSUS. Further to the discussion above, the two headings within the chapter that
are relevant to this issue are headings 8541 and 8543, HTSUS.
1. Gerson’s Articles Are Not within the Scope of Heading 8541, HTSUS
The uncontested facts pertaining to the physical and functional characteristics of the
merchandise require the court to eliminate from consideration heading 8541, HTSUS, which
contains the terms “semiconductor devices” and “light-emitting diodes.” Each article at issue
contains a light-emitting diode as a source of illumination, but the article as a whole contains
other major components as well and, therefore, does not conform to a common or commercial
definition of the term “semiconductor device” or the term “light-emitting diode.” 7
Gerson takes issue with what it describes as the position of Customs that heading 8541,
HTSUS is limited to discrete semiconductors. Pl.’s Mot. 15. Gerson argues, specifically, that
“this Customs attempt to limit heading 8541 to discrete semiconductors has been unequivocally
rejected by the Court of International Trade in ABB Power Transmission v. United States,
19 CIT 1044, 896 F. Supp. 1279 (1995).” Pl.’s Mot. 15. In support of its argument that the
terms of heading 8541, HTSUS describe its goods, Gerson relies in part on note 8 to chapter 85,
HTSUS, which provides that “[f]or the classification of the articles defined in this note, headings
8541 and 8542 shall take precedence over any other heading in the Nomenclature, except in the
case of heading 8523, which might cover them by reference to, in particular, their function.”
7
Note 8(a) to chapter 85, HTSUS provides that the term “diodes, transistors and other
semiconductor devices,” which appears in the article description for heading 8541, refers to
“semiconductor devices the operation of which depends on variations in resistivity on the
application of an electric field.” The HTSUS does not define “light-emitting diode,” but the
Explanatory Note to heading 85.41 states that “[l]ight emitting diodes, or electroluminescent
diodes, (based, inter alia, on gallium arsenide or gallium phosphide) are devices which convert
electric energy into visible, infra-red or ultra-violet rays. They are used, e.g., for displaying or
transmitting data in control systems.” EN 85.41(C).
Court No. 11-00225 Page 9
Note 8 to ch. 85, HTSUS. The court is not convinced by these arguments. ABB Power
Transmission is not on point, having involved the tariff classification of a module consisting of
six thyristors, heatsinks, voltage divider circuits and other circuitry that was a component of a
larger system (a direct current conversion station for power generation). 19 CIT at 1044-45,
896 F. Supp. at 1280. The court concluded that the assembled module functioned as a single
thyristor, a semiconductor. Id. at 1049, 896 F. Supp. at 1283. Gerson’s articles are stand-alone
items, not components within larger systems, and they perform both decorative and illuminating
functions that are beyond those of a semiconductor device or LED, whether or not “discrete.”
Gerson’s reliance on note 8 to chapter 85, HTSUS is also unavailing because its goods are not
“articles defined in this note.” See note 8 to ch. 85, HTSUS.
2. Gerson’s Articles Are Classified under Heading 9405, HTSUS, Not Heading 8543, HTSUS
It is plausible to read the pertinent terms of heading 8543, HTSUS as encompassing the
merchandise in question. See heading 8543, HTSUS (“Electrical machines and apparatus,
having individual functions, not specified or included elsewhere in this chapter; . . .”). As does
any electric lamp, each Gerson article depends for illumination on the operation of electricity.
Also, it can be argued that these articles have “individual functions.”
The qualification “not specified or included elsewhere in this chapter [85]” contained
within the article description for heading 8543, HTSUS would be met by Gerson’s articles.
Although the headings of chapter 85 other than heading 8543 include articles that may be
described as “lamps,” Gerson’s articles are not described by any of these other headings. See
HTSUS headings 8512 (electrical lighting equipment for cycles or motor vehicles); 8513 (certain
portable electric lamps such as flashlights); 8530 (certain electrical signaling equipment); 8531
(visual signaling apparatus other than those of heading 8512 or 8530); 8539 (electric filament
Court No. 11-00225 Page 10
(i.e., incandescent) or discharge (i.e., fluorescent) lamps; arc lamps); the aforementioned 8541
(light-emitting diodes); and heading 8545 (lamp carbons). Therefore, were Gerson’s
merchandise properly held to fall within the scope of heading 8543, HTSUS as an “electrical
machine” or an “electrical apparatus,” then consideration of heading 9405, HTSUS, would be
precluded by operation of note 1(f) to chapter 94, HTSUS. Moreover, because heading 9405,
HTSUS is limited to lamps and lighting fittings “not elsewhere specified or included,” Gerson’s
articles could not be classified thereunder if they fall within the scope of heading 8543, HTSUS.
See heading 9405, HTSUS (“Lamps and lighting fittings . . . not elsewhere specified or
included” (emphasis added)). Gerson makes this argument (among others). Pl.’s Mot. 15.
If Gerson’s proffered interpretation of the scope of heading 8543, HTSUS were adopted,
Gerson would have met its burden of establishing that the government’s classification under
heading 9405, HTSUS is incorrect. Concluding to the contrary, the court rejects Gerson’s broad
interpretation of the scope of heading 8543, HTSUS and its position classifying the articles at
issue thereunder. The court concludes instead that heading 9405, HTSUS is the correct heading
for Gerson’s articles. In brief summary, these articles are within a class or kind of electric lamps
that are self-contained, i.e., independently used. In addition, they have a decorative as well as an
illuminating function. The class or kind of goods to which Gerson’s articles belong falls
generally within chapter 94, under heading 9405, HTSUS, not within chapter 85, under
heading 8543, HTSUS.
Chapter 85, HTSUS includes within it certain electric “lamps” that are excluded from
chapter 94 by operation of note 1(f) to chapter 94. Such lamps necessarily include those within
the article descriptions of HTSUS headings 8512, 8513, 8530, 8531, 8539, and 8541, each of
which the court discussed previously, and they also include the “lamp carbons” of heading 8545,
Court No. 11-00225 Page 11
HTSUS, whether or not considered to be “lamps.” As to the proper heading for Gerson’s
articles, the precise question presented is whether the term “electrical machines and apparatus,
having individual functions,” as used in the article description for heading 8543, HTSUS was
intended to refer to the entire class or kind of goods comprised of electric lamps, and thereby, as
a result of note 1(f) to chapter 94, exclude that entire class or kind from the scope of chapter 94,
HTSUS in general and from the scope of heading 9405, HTSUS in particular.
The term “electrical machines and apparatus” as used in heading 8543, HTSUS is not
free of ambiguity. Terms in a tariff statute are to be given their “common and commercial”
meaning, La Crosse, 723 F.3d at 1358. While any electric lamp (or electric lighting fitting) may
be described as an “electrical machine” or an “electrical apparatus” in a hyper-technical sense,
the term “electrical machines and apparatus” is not necessarily read so broadly, in the common
and ordinary sense, as to include the class or kind of goods exemplified by Gerson’s articles,
which are stand-alone items designed to provide decoration and illumination in the household.
Resolving the ambiguity requires the court to give meaning to the context imparted by other,
related HTSUS provisions. In this case, reading the term “electrical machines and apparatus” as
used in heading 8543, HTSUS so broadly as to include all electric lamps and lighting fittings
produces an anomalous result with respect to the relative scopes of the two HTSUS headings,
8543 and 9405, under which the latter would be confined to non-electric lamps and lighting
fittings. Such a reading would impose a specific, and drastic, limitation on the scope of heading
9405, HTSUS that the article description for that heading does not express or suggest.
Moreover, this interpretation would be contrary to the intent of the drafters of the Harmonized
System, as expressed in various HS Explanatory Notes.
Court No. 11-00225 Page 12
Referring specifically to the inclusion within HS heading 94.05 of “[l]amps and lighting
fittings, not elsewhere specified or included,” EN 94.05 instructs that “[l]amps and lighting
fittings of this group can . . . use any source of light (candles, oil, petrol, paraffin (or kerosene),
gas, acetylene, electricity, etc.).” EN 94.05 (emphasis added). A wide variety of examples is
given; see EN 94.05(I)(1) (“This heading covers, in particular: . . . Lamps and lighting fittings
normally used for the illumination of rooms, e.g.: hanging lamps; bowl lamps; ceiling lamps;
chandeliers; wall lamps; standard lamps; table lamps; bedside lamps; desk lamps; night
lamps . . .”). The examples provided of lamps for the illumination of rooms necessarily would
include those with decorative as well as illuminating functions.
The general Explanatory Note to HS Chapter 85 lends further support to the conclusion
that many electric lamps and lighting fittings fall within HS heading 94.05 and outside of
HS chapter 85. This EN clarifies that chapter 85 includes “[c]ertain electrical goods not
generally used independently, but designed to play a particular role as components, in electrical
equipment, e.g., . . . lamps (heading 85.39) . . . .” EN 85(A)(6). This reference to the “lamps” of
HS heading 85.39 would encompass what are commonly referred to as “light bulbs,” including
incandescent (“filament”) and fluorescent (“discharge”) light bulbs. See HS heading 85.39
(“Electrical filament or discharge lamps, including sealed beam lamp units and ultra-violet or
infra-red lamps; arc-lamps”). Similarly, chapter 85 also includes electric lighting and signaling
equipment for motor vehicles (HS heading 85.12). The HS drafters adopted as a general
organizing principle that chapter 85 includes “lamps” (including those commonly referred to as
“bulbs”) that are not used independently, and those that are used independently were as a general
matter left to fall within chapter 94, in HS heading 94.05. An exception to the general
organizing principle is HS heading 85.13, which contains certain “portable” lamps, some of
Court No. 11-00225 Page 13
which, such as flashlights, are used “independently.” Nevertheless, when the applicable heading
terms and legal notes are construed according to the clarification provided by the Explanatory
Notes, it is apparent that the HS drafters intended for the class or kind of goods comprised of
self-contained, independently-used furnishings such as electric household lamps and lighting
fittings to be classified under HS heading 94.05 and not under HS heading 85.43. In reaching
this conclusion, the court attaches significance to the instruction in EN 94.05 that heading 94.05
“covers in particular: . . . Lamps and lighting fittings normally used for the illumination of
rooms.” EN 94.05(I)(1). The lamps and lighting fittings specified by the headings of
HS chapter 85 either are not designed for, or are not designed exclusively or specifically for,
interior illumination. See ENs for HS headings 85.12 (motor vehicle lighting and signaling
equipment), 85.13 (certain portable electric lamps, including flashlights), 85.30 (certain electrical
signaling equipment), 85.31 (other signaling equipment), 85.39 (electric filament (including
incandescent) or discharge (including fluorescent) lamps), 85.41 (light-emitting diodes),
and 85.45 (carbons for use in arc lamps and electric resistance lamps).
As the court discussed above, EN 85.39 uses the term “electric filament or discharge
lamps” to refer to various classes of goods that commonly may be described as electric light
bulbs. EN 85.39 is also instructive as to the delineation between the scope of that heading and
that of HS heading 94.05. EN 85.39 defines “electric light lamps” as consisting of “glass or
quartz containers, of various shapes, containing the necessary elements for converting electrical
energy into light rays (including infra-red or ultra violet rays).” EN 85.39. The sentence in the
EN following the above-quoted definition is as follows: “The heading covers all electric light
lamps, whether or not specially designed for particular uses (including flashlight discharge
lamps).” Id. (emphasis added). This sentence could be read broadly as to refer to the household
Court No. 11-00225 Page 14
lamps and lighting fittings of heading 94.05. Nevertheless, to interpret it so broadly would be to
read it mistakenly, out of the context provided by this and related ENs, which point to HS
heading 94.05, not to HS chapter 85, for lamps that are self-contained and, in the words of the
EN to chapter 85, “used independently.” In short, the “lamps” that may be described as light
bulbs and similar such electrical devices not used independently are classified generally within
HS chapter 85, and those that are used independently are classified generally within HS
chapter 94. 8
The intent of the drafters to adopt the general organizing principle the court has identified
is further demonstrated by EN 85.43: “This heading covers all electrical appliances and
apparatus, not falling in any other heading of this Chapter, nor covered more specifically by a
heading of any other Chapter of the Nomenclature . . . .” HS heading 85.43 does not refer to
lamps or lighting fittings but only generally to electrical machines and apparatus; HS
heading 94.05, in contrast, specifically provides for lamps and lighting fittings and encompasses
them provided they are not elsewhere specified or included.
In summary, when considered together, the ENs relating to HS chapter 85, to certain
headings therein, and to HS heading 94.05 support the conclusion that goods such as Gerson’s
articles, which are self-contained, i.e., “independently used,” lamps suitable for household use as
illuminating and decorative articles, were intended by the Harmonized System drafters to fall
within HS heading 94.05, not HS heading 85.43.
8
The lamps and lighting fittings of heading 9405, HTSUS would be classified under that
heading even if imported without bulbs (in the parlance of the ENs, “lamps”) or, if
battery-operated, batteries. See GRI 2, HTSUS. Analogously, heading 9405, HTSUS includes
candelabras, see EN 94.05(I)(6), but it does not include candles (heading 3406, HTSUS).
Court No. 11-00225 Page 15
In arguing for classification of its articles under heading 8543, HTSUS, Gerson argues
that EN 85.43(16) gives as an example of goods of that heading “Electro-luminescent devices,
generally in strips, plates or panels, and based on electro-luminescent substances (e.g., zinc
sulphide) placed between two layers of conductive material.” Pl.’s Mot. 8 (quoting EN 85.43).
In that regard, Gerson also directs the court’s attention to the presence under the heading of
subheading 8543.70.70, HTSUS (“Other machines and apparatus: Electric luminescent lamps”).
Id. at 12. Gerson argues that its articles are electric, are luminescent, and are lamps; it submits,
therefore, that heading 8543, HTSUS is the correct heading and 8543.70.70, HTSUS is the
correct subheading. The court, of course, first considers the scope of the heading itself and will
not construe a subheading to have the effect of enlarging the scope of a heading, as that would be
inconsistent with the requirement of GRI 1, HTSUS and the organization of the remaining GRIs,
including in particular GRI 6, HTSUS.
The reference in EN 85.43 to electro-luminescent devices is not necessarily read so
broadly as to describe articles such as those at issue in this case. To the contrary, the phrase used
therein, “generally in strips, plates or panels, and based on electro-luminescent substances . . .
placed between two layers of conductive material,” EN 85.43 (emphasis added), connotes a
device that is itself more directly the source of the illumination than is one of Gerson’s articles,
each of which contains an LED (presumably, a device of HS heading 85.41) among various other
components that together form a stand-alone, decorative and illuminating article. Consistent
with the general principle expressed by the Explanatory Notes that electric lamps of
HS chapter 85 are those not used independently, the class or kind of goods to which Gerson’s
articles belong, i.e., household furnishings such as stand-alone lamps, generally are classified
under HS heading 94.05, not HS heading 85.43.
Court No. 11-00225 Page 16
Gerson argues that classification of its goods under subheading 8543.70.70, HTSUS
(“Electric luminescent lamps”) would not drastically limit (“empty”) the scope of heading 9405,
HTSUS because the subheading is limited to electric luminescent lamps. Pl.’s Mem. of Law
Rebutting Def.’s Opp’n to Pl.’s Mot. for Summ. J. and Opposing Def.’s Cross Mot. for
Summ. J. 5 (Dec. 12, 2016), ECF No. 54. The flaw in this argument is Gerson’s reading too
much into the terms of that subheading, which are not necessarily interpreted so broadly as to
encompass the independently-used goods at issue here. The placement of this U.S.-specific
eight-digit subheading under a four-digit internationally-harmonized heading cannot correctly be
interpreted as an intended enlargement of the scope of that heading. See GRIs 1, 6, HTSUS.
Moreover, the court sees no indication of congressional intent to place within heading 8543,
HTSUS a self-contained, independently-used, decorative household-type lamp simply because it
uses an LED or other electric luminescent device as a light source. The terms of heading 8543,
HTSUS create no such distinction, nor is there is an indication of a congressional intent to depart
from the established HS nomenclature. Moreover, the premise underlying Gerson’s argument
would raise a tariff classification question as to any of a class of decorative electric lamps that
are made to resemble candles and typically are designed to be fitted with a specially-shaped
incandescent bulb. The implication of Gerson’s argument that the classification it advocates
would not empty heading 94.05 is that this similar class or kind of goods still would be classified
under heading 9405, HTSUS, while Gerson’s articles (which are highly similar in form and
function and differ principally only in the type of light source) instead would be classified under
heading 8543, HTSUS because the light source is electro-luminescent or because it is an LED.
But such a distinction would not be supported by the relevant terms of the two competing
Court No. 11-00225 Page 17
headings and would contravene the intent of the drafters of the HS as indicated by the
Explanatory Notes.
In summary, for the reasons discussed above, the court concludes that by operation of
GRI 1, HTSUS, Gerson’s “candles” and “tea lights” are not properly classified under
heading 8543, HTSUS as “[e]lectrical machines and apparatus” but instead fall within the scope
of heading 9405, HTSUS as “[l]amps . . . not elsewhere specified or included.” Because the
correct heading for these articles is determined by operation of GRI 1, the classification issue
presented does not call for consideration of the remaining GRIs.
G. Application of GRI 6, HTSUS to Determine the Correct Subheading of the HTSUS
The first subheading within heading 9405, HTSUS is subheading 9405.10, HTSUS
(“Chandeliers and other electric ceiling or wall lighting fittings . . .”), which does not describe
the goods at issue. Nor does the second subheading, subheading 9405.20, HTSUS (“Electric
table, desk, bedside or floor-standing lamps”), which sets forth terms applicable to lamps
specially designed for these four specific placements. Instead, Gerson’s articles do not fit within
any of these categories of lamps and, as indicated in the catalogue illustrations, are suitable for
placement on any horizontal surface (e.g., on an article of furniture or a fixture such as a shelf or
fireplace mantle), in the manner of a candle. Subheading 9405.30, HTSUS is confined to
“[l]ighting sets of a kind used for Christmas trees.” Therefore, the correct subheading
is 9405.40.80, HTSUS (applying to “Other electric lamps . . . :” not of base metal), the
classification determined by Customs upon liquidation and advocated by defendant before the
court.
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III. CONCLUSION
For the reasons stated above, the court will grant defendant’s cross motion for summary
judgment, concluding that the merchandise at issue is properly classified in subheading
9405.40.80, HTSUS (“Lamps and lighting fittings including searchlights and spotlights and parts
thereof, not elsewhere specified or included; . . . : Other electric lamps and lighting fittings:
Other”), subject to duty at 3.9% ad val.
Judgment will enter accordingly.
/s/Timothy C. Stanceu
Timothy C. Stanceu
Chief Judge
Date: August 2, 2017
New York, NY