Belimo Automation A.G. v. United States

United States Court of Appeals
for the Federal Circuit
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BELIMO AUTOMATION A.G.,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
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2014-1165
______________________
Appeal from the United States Court of International
Trade in No. 10-CV-0113, Judge Mark A. Barnett.
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Decided: December 19, 2014
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ROBERT B. SILVERMAN, Grunfeld, Desiderio, Lebowitz,
Silverman & Klestadt LLP, of New York, New York,
argued for plaintiff-appellant. With him on the brief were
PETER W. KLESTADT and ROBERT F. SEELY.
AMY M. RUBIN, Assistant Director, Commercial Litiga-
tion Branch, Civil Division, United States Department of
Justice, of New York, New York, argued for defendant-
appellee. With her on the brief were STUART F. DELERY,
Assistant Attorney General and JEANNE E. DAVIDSON,
Director, of Washington, DC. Of counsel on the brief was
MICHAEL W. HEYDRICH, Office of Assistant Chief Counsel,
2 BELIMO AUTOMATION A.G. v. US
United States Customs and Border Protection, of New
York, New York.
______________________
Before PROST, Chief Judge, NEWMAN and TARANTO, Cir-
cuit Judges.
PROST, Chief Judge.
Belimo appeals from the Court of International
Trade’s classification of Belimo’s imports as “electric
motors” under subheading 8501.10.40 of the Harmonized
Tariff Schedule of the United States (“HTSUS”). Belimo
argues that the subject imports should have been classi-
fied as “automatic regulating and controlling instruments
and apparatus; parts and accessories thereof” under
HTSUS 9032.89.60. Because we agree with the Court of
International Trade that Belimo’s imports are not de-
signed to measure either temperature or a variable of
liquids or gases, as is required by HTSUS 9032.89.60, we
affirm.
BACKGROUND
Belimo’s imported devices consist of an electric motor,
gears, and two printed circuit boards, and are principally
used in heating, ventilating, and air conditioning
(“HVAC”) systems within buildings. Belimo Automation
A.G. v. United States, 35 ITRD 2319, 2013 WL 6439119,
at *1 (Ct. Int’l Trade 2013) (“Opinion”). HVAC systems
work by pumping cold or hot air into a room. The HVAC
system’s sensors detect the ambient temperature in a
given space, and send information to a central controller,
which compares the actual temperature values to the
user’s desired temperature values. Next, the central
controller sends a signal to the actuators, electric motors
that adjust the angle of a damper blade to let in more or
less hot or cold air.
BELIMO AUTOMATION A.G. v. US 3
In a traditional HVAC system, the actuator receives
the signal from the central controller and moves the
damper blade to the position indicated by the controller.
However, if a disturbance such as a strong draft moves
the damper blade, it may become stuck in the incorrect
position. Belimo’s products are similar to a traditional
actuator, but represent an improvement in that they
incorporate a programmed Application Specific Integrated
Circuit (“ASIC”). The ASIC’s purpose is to continuously
and independently monitor the damper blade’s position,
and maintain it at the correct angle without any input
from the central controller. The ASIC accomplishes this
by monitoring the behavior of the electric motor that
moves the damper blade. 1
The ASIC operates independently from the central
controller and can detect unintended changes in damper
blade position; this allows it to better maintain the blade’s
position against disturbances. The ASIC performs other
independent functions: it can adapt to receive an AC or
DC signal from the controller, filter out unintended
electric signals, and use stored energy to prevent the
motor from spinning out of control in the event of a power
failure. Opinion, 2013 WL 6439119, at *8; Appellant’s Br.
14 (agreeing with the Court of International Trade’s
factual recitation).
The subject imports entered the United States be-
tween February 9, 2007 and February 26, 2007. U.S.
Customs and Border Protection liquidated them between
1 Different models of the subject imports employ
different methods to monitor the motor, such as measur-
ing electric resistance or changes in the motor’s magnetic
field. We agree with the Court of International Trade
that the differences in the subject imports’ motor monitor-
ing methods are not material to our analysis. Opinion,
2013 WL 6439119, at *1 n.2.
4 BELIMO AUTOMATION A.G. v. US
December 21, 2007 and January 11, 2008 under HTSUS
8501.10.40. Belimo timely filed a request protesting this
classification decision on June 17, 2008. On September
18, 2009, Customs denied the request. HQ H044560
(Sept. 18, 2009). Belimo challenged the denial of its
request at the Court of International Trade, claiming that
the products should have been classified as “automatic
regulating and controlling instruments and apparatus;
parts and accessories thereof” under HTSUS 9032.89.60.
The Court of International Trade affirmed on cross-
motions for summary judgment that the actuators could
not be classified under HTSUS 9032, because they do not
automatically measure the actual value of the tempera-
ture or any variable of air, as required by HTSUS Chap-
ter 90, Note 7(a). Opinion, 2013 WL 6439119, at *7. The
Court of International Trade also held that the subject
actuators were correctly classified as “electric motors”
under Heading 8501. Id. at *7–8. Despite the fact that
the actuators incorporated additional parts and compo-
nents such as the ASIC, which allowed the motor to
operate more precisely and reliably, the court held that
“the ASIC does not change the principal function of the
subject imports as electric motors.” Id. at *8 (quoting
Nidec Corp. v. United States, 68 F.3d 1333, 1337 (Fed.
Cir. 1995)). Belimo appeals. We have jurisdiction under
28 U.S.C. § 1295(a)(5).
STANDARD OF REVIEW
The meaning and scope of tariff headings and sub-
headings presented in this appeal are pure questions of
law which this court reviews de novo. Deckers Corp. v.
United States, 532 F.3d 1312, 1314 (Fed. Cir. 2008);
Metchem, Inc. v. United States, 513 F.3d 1342, 1345 (Fed.
Cir. 2008).
BELIMO AUTOMATION A.G. v. US 5
DISCUSSION
HTSUS Chapter 90, Note 7(a) can be broken up into
three main clauses, and provides that Heading 9032
applies only to:
[1] Instruments and apparatus for automatically
controlling the flow, level, pressure or other vari-
ables of liquids or gases, or for automatically con-
trolling temperature,
[2] whether or not their operation depends on an
electrical phenomenon which varies according to
the factor to be automatically controlled,
[3] which are designed to bring the factor to, and
maintain it at, a desired value, stabilized against
disturbances, by constantly or periodically meas-
uring its actual value.
The parties’ disagreement is focused on whether
Belimo’s products satisfy the requirements of clauses one
and three. We hold that Belimo’s actuators are not de-
signed to measure the actual value of a factor of liquids or
gases, as required by clause three. Thus, we do not decide
whether they automatically control temperature or a
variable of liquids or gases as required by clause one.
Clause three requires a qualifying instrument to
measure the actual value of “the factor.” Belimo incor-
rectly argues that “the factor” includes electrical phenom-
ena, such as the actuator motor’s behavior. Rather, “the
factor” refers to “the factor to be automatically controlled”
in clause two. Clause one in turn establishes the set of
things that may be automatically controlled: “the flow,
level, pressure or other variables of liquids or gases,” as
well as “temperature.” Therefore, “the factor” is a general
term that consists of temperature, as well as flow, level,
pressure, and other variables of liquids or gases that may
be automatically controlled by the instrument or appa-
ratus. The factor to be automatically controlled by the
6 BELIMO AUTOMATION A.G. v. US
subject imports is air flow—and by extension, room tem-
perature—but the “factor” here does not include motor
winding position or any electrical phenomenon. To quali-
fy under Heading 9032, therefore, Belimo must show at
least that its actuators are designed to measure the actual
value of temperature, or some other variable of air such
as flow, level, or pressure.
Belimo acknowledges that the ASIC “measure[s] the
current position of the damper blade.” Appellant’s Br. 8.
The ASIC does not directly measure air flow or tempera-
ture; that is the job of the HVAC sensors. Belimo argues,
however, that its ASIC measures flow indirectly, using
the changes in damper blade position as a reference.
Appellant’s Reply Br. 16 (“[Damper blade] position
equates to a specific flow as a proportion of the total
potential flow through the HVAC conduit at a given level
of pump or fan pressure.”). Belimo argues that “[i]t is
enough if the controlling device is simply ‘sensitive to
changes in the variable to be controlled.’” Id. at 17. To
support this position, Belimo cites the additional guidance
in Explanatory Note EN 9032(I), which explains that “in
some cases, a simple device which is sensitive to changes
in the variable . . . may be used instead of a measuring
device.” Appellant’s Br. 20. The government does not
dispute that a Heading 9032 controller may measure the
variable to be controlled indirectly. Appellee’s Br. 30.
Rather, the government argues that the subject imports
do not “measure” flow in the relevant sense. Id.
Belimo’s argument that a device merely needs to be
“sensitive to changes in the variable to be controlled”
stretches the heading too far. A block of ice may be
sensitive to temperature, but the ice does not “measure”
temperature in any meaningful way. We need not decide
precisely how direct or indirect a device’s measurement
must be in order to satisfy this requirement. It is enough
to resolve this case that Note 7(a) requires the instrument
or apparatus be “designed” to control a factor through the
BELIMO AUTOMATION A.G. v. US 7
measurement of the factor’s actual value. See Note 7(a)
(Heading 9032 applies to “instruments . . . which are
designed to bring the factor to, and maintain it at, a
desired value, . . . by constantly or periodically measuring
its actual value.”) (emphasis added). Although the ASIC
monitors the motor’s behavior and measures the damper
blade’s position, it was not designed to control airflow or
temperature by directly or indirectly measuring its actual
value. The airflow rate is not well correlated to the
position of the damper blades; it also depends on the
speed of the system fan, for example. Meanwhile, tem-
perature is sensitive to a multitude of factors besides
damper blade position, including whether the doors or
windows in the room are open, the number of room occu-
pants, the location of the room within the building, etc.
Moreover, even if Belimo’s actuators could be used with
some degree of success to calculate air flow in a room,
they are not designed to take the place of the HVAC
sensors, which do measure temperature and report this
information to the central controller. Unlike the exem-
plars in EN 9032(I) that are designed to measure the
actual value of variables of gases through indirect meth-
ods, see Appellant’s Reply Br. 18 (“Pressure regulators
may operate based on the force exerted on ‘an adjustable
spring,’ and a humidistat may operate based on the
length of strands of hair.”), Belimo’s actuators are only
designed to monitor motor behavior. Therefore, they
cannot be classified under HTSUS Heading 9032.
We turn next to whether Belimo’s actuators were
properly classified as “electric motors” under HTSUS
Heading 8501.10.40. Belimo concedes that absent the
ASIC, its actuators would be classified under Heading
8501. Appellant’s Br. 47. Belimo argues, however, that
the inclusion of the ASIC “changes [the actuator’s] func-
tionality from electric motor to automatic controller of
fluids and gases.” Id. at 47–48. Belimo even goes so far
8 BELIMO AUTOMATION A.G. v. US
as to say they are no longer “actuators” as a result.
Appellant’s Reply Br. 24.
The Court of International Trade properly dismissed
Belimo’s argument. The actuators are electric motors, as
they convert electric energy into mechanical energy.
Opinion, 2013 WL 6439119, at *7. Note 3 to Section XVI,
which encompasses Heading 8501, states that “[u]nless
the context otherwise requires, . . . machines designed for
the purpose of performing two or more complementary or
alternative functions are to be classified as . . . that ma-
chine which performs the principal function.” Although
the ASIC “contributes additional functionalities beyond
those that a basic electric motor offers, including continu-
ous monitoring of the motor absent a signal from the
central controller, adapting to AC or DC electrical signals,
and storing energy for use in the event of a power failure,”
these additional functions are complementary to the
principal function of an electric motor, and all relate to
improving the precision and reliability of the motor’s
operation. Id. at *8. In other words, although the pres-
ence of the ASIC may allow the motor to do its job more
efficiently and accurately, and in some cases more safely,
the ASIC’s principal function is nonetheless to assist in
moving the damper blades. 2 Classification of Belimo’s
2 Belimo criticizes the Court of International Trade
for relying on Nidec Corp. v. United States, 68 F.3d 1333,
1336-37 (Fed. Cir. 1995). Belimo attempts to distinguish
the case on the ground that its products automatically
perform a measurement and control function, whereas the
motor in Nidec did not. However, as in Nidec, the “basic
character” of Belimo’s product is a motor with an addi-
tional component—the ASIC—that improves its precision.
Thus, its principal function is still that of an electric
motor. See Opinion, 2013 WL 6439119, at *8.
BELIMO AUTOMATION A.G. v. US 9
products as motors under Heading 8501.10.40 is therefore
proper.
CONCLUSION
For the aforementioned reasons, we affirm the judg-
ment of the Court of International Trade.
AFFIRMED