No Decision in CIT Tariff Classification Case on Heat-Sensitive Glass Bulbs
The Court of International Trade refused to rule in a tariff classification case on heat-sensitive glass bulbs, finding factual disputes prevented them from judging the legal merits of either party’s arguments. At issue was a CBP classification of Tyco Fire Products’ glass bulbs, which are filled with a chemical that causes them to explode when heated. CBP had classified them as articles of glass, but Tyco said the bulbs were parts of fire sprinkler systems and water heaters, and should be classified as such. CIT said it couldn’t rule on the question, because the parties hadn’t submitted enough evidence for the court to consider (1) whether the glass or the chemical gave the bulbs their essential character, and (2) whether the bulbs were mainly used in Tyco’s asserted applications.
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.
Tyco imported its glass bulbs from Germany into the Port of Dallas-Fort Worth from 2004 to 2006. The glass bulbs are filled with a liquid that expands when heated. If heated enough, the interior liquid expands so much that the surrounding glass bulb can no longer take the pressure, and shatters. According to Tyco, the bulbs are used to activate fire sprinkler systems. They hold closed a valve, and when heated they explode, the valve opens, and water flows. Some are also used for water heaters, where the glass bulbs hold open a door to supply air to the combustion chamber, Tyco said. When heated too much, the glass bulbs explode, and the door closes to prevent an explosion.
On liquidation, CBP classified the bulbs under Harmonized Tariff Schedule subheading 7020.00.60 (“other articles of glass: other”), dutiable at 5%. Tyco protested, but CBP confirmed its original classification in ruling HQ H005116 (here). Tyco argues the products should be classified under HTS provisions for parts of water heaters in heading 8419, and parts of fire sprinkler systems under heading 8424. Goods under the relevant subheadings within those provisions enter duty free.
Turning to the descriptions of the headings and the accompanying notes, CIT said heading 7020 applies to articles containing glass not described elsewhere in the HTS. The Explanatory Notes to chapter 70 say that articles of glass remain in heading 7020, even if combined with other materials, as long as they retain the essential character of glass articles. So if Tyco’s bulbs are not classified elsewhere in the HTS, and if they retain the essential character of articles of glass articles, then they should be classified in heading 7020, CIT said. Note 1(c) to Chapter 84 confirms that interpretation, excluding glass articles of headings 7017, 7019, or 7020, CIT said. The explanatory notes to chapter 84 clarify that Note 1(c) excludes an article if “it has the character of an article … of glass.”
But the court couldn’t make either of the required determinations to judge whether CBP correctly classified the goods, it said. First, neither party placed on the record evidence of the relative composition or value of glass and the heat-sensitive chemical for the purpose of performing an essential character test. Also, the court didn’t have enough information to decide if the goods were described by headings 8419 and 8424. Although Tyco used the bulbs for water heaters and sprinkler systems, neither Tyco nor the government had shown whether those are the predominant uses industry-wide, CIT said.
“Although summary judgment is often an important, frequently-used tool in classification cases, failure of either party to succeed on its summary judgment does not automatically result in summary judgment for the other party, even in light of the statutory burden placed on Tyco,” the court concluded. “Where factual disputes persist, a trial may be needed to permit the court to find the requisite facts in order to make the legal determination of selecting the appropriate tariff provision.”
(Tyco Fire Prods. L.P. v. United States, Slip Op .13-78, dated 06/21/13, Judge Restani)
(Attorneys: Michael Roll of Pisani & Roll for plaintiff Tyco Fire Products L.P.; Amy Rubin for defendant U.S. government)