CIT Allows Moen to Withdraw From Classification Suit Due to Section 301 Tariffs Over DOJ Opposition
The Court of International Trade will allow Moen to end its lawsuit over what the company said were misclassified showerheads despite the Department of Justice's objections, CIT said in a July 26 ruling. Moen, which sued CBP in 2015 over the classification of the goods, filed a motion to dismiss because the goods at issue are now subject to the Section 301 25 percent tariffs on imports from China. The DOJ fought the motion because of the already expended time and resources and because Moen will "likely litigate the correct classification of its showerheads if and when goods classifiable under its claimed tariff provision are no longer subject to the 301 duties.”
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CBP classified the merchandise in subheading 3924.90.5650 as “Tableware, kitchenware, other household articles and hygienic or toilet articles, of plastics: Other: Other, Other," which had a 3.4 percent duty rate when liquidated in 2014. That subheading isn't on any of the Section 301 tariffs currently in place, though it is on the proposed fourth tranche of tariffs (see 1905130063). Moen challenged the classification and claimed subheading 8424.89.0000 as "Mechanical appliances (whether or not hand operated) for projecting, dispersing or spraying liquids or powders . . . ; parts thereof: Other appliances: Other," which was then dutied at 1.8 percent but is now subject to the 301 tariffs.
Moen's motion to dismiss explained that “[t]he Section 301 duties imposed by the Government have significantly changed the importing landscape for showerheads manufactured in China.” The company also noted that "goods from China classified under subheading 8424.90.90, HTSUS, (its alternative classification claim) are subject to Section 301 additional duties of 10%, effective September 24, 2018." The court sided with Moen, noting that some of the time and effort spent already would be applicable if Moen does decide to pursue another lawsuit.
(Moen, Inc., v. U.S., Slip Op. 19-95, CIT # 15-00161, dated 07/26/19, Judge Stanceu)
(Attorneys: William Rucker of Drinker Biddle for plaintiff Moen, Inc.; Jamie Shookman for defendant U.S. government)