CAFC Upholds CIT Ruling in Wood Flooring HTS Classification Case
The U.S. Court of Appeals for the Federal Circuit affirmed CBP’s Harmonized Tariff Schedule classification of Kahrs International’s engineered wood flooring as plywood, rather than parquet panels or builder’s joinery. The Court of International Trade had originally sustained CBP’s classification in 2009. Kahrs argued that its engineered wood flooring did not meet the commercial meaning of plywood. But CAFC said the commercial definition of a product is irrelevant for tariff provisions that describe products by name rather than use.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
Kahrs’ engineered wood flooring is composed of multiple layers of wood that are glued together and laminated to resemble hardwood flooring. They are bonded together so that the grains of adjacent layers are at right angles.
On importation, Kahrs classified its engineered wood flooring in HTS subheading 4418.30.00, “Builders’ joinery and carpentry of wood, including cellular wood panels and assembled parquet panels: shingles and shakes: parquet panels,” which enters duty free. CBP instead liquidated the product under a subheading in HTS heading 4412, which covers “plywood, veneered panels and similar laminated wood,” at a duty rate of eight percent.
Kahrs argued that its engineered wood flooring shouldn’t be classified as plywood because it didn’t meet the commercial definition of plywood. But if it was classifiable as plywood, it should still be classified in HTS heading 4418 as either builders’ jointery or parquet panels because that heading is more specific, the company said.
The court found the commercial definition to be irrelevant for classification of plywood, because the provision at issue is an eo nomine term that refers to the product by name, not a use provision. “Generally, we should not read a use limitation into an eo nomine provision unless the name itself inherently suggests a type of use,” the court said.
Turning to the plain meaning of plywood, the court found that Kahrs’ engineered wood flooring met the definition the court set forth in Boen Hardwood Flooring, Inc. v. U.S. (2004) in every respect. The flooring panels were composed of at least three layers of wood, each arranged at right angles to adjacent layers, and the layers were bonded together. Furthermore, the explanatory notes say heading 4412 covers plywood panels or venered panels used as flooring panels, and “sometimes referred to as ‘parquet flooring,’” the court said.
Meanwhile, the engineered wood flooring did not meet the definition of parquet panels classifiable in heading 4418 -- as noted by CIT, it didn’t form a geometric or mosaic pattern, the appeals court said. CAFC didn’t arrive at the question of whether the flooring was classifiable as builders’ joinery in heading 4418, because plywood is a more specific term.
(Kahrs International, Inc. v. U.S., appeal no. 2012-1034, dated 04/03/13, Judge Reyna)
Attorneys: (Carl Cammarata of the Law Offices of George R. Tuttle for plaintiff-appellant Kahrs International, Inc.; Mikki Cottet for defendant U.S. government)