Home Depot Takes to Trade Court to Contest Classification of Residential Door Knobs
CBP misclassified Home Depot U.S.A.'s imports of residential door knobs packaged with at least one deadbolt, Home Depot argued in two Oct. 31 complaints at the Court of International Trade. The retail giant originally launched the cases in 2014, just now bringing the complaints to the court to vie for a change in classification for the door knobs under the Harmonized Tariff Schedule, which would see the duty rates for the imports drop from 5.7% to 3.9% (Home Depot U.S.A. v. United States, CIT #14-00122, #14-00123).
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The goods in question are combination sets comprised of an "entry" door knob with at least one deadbolt lock in addition to keys, strike plates and mounting hardware, marketed under the Defiant brand. CBP liquidated the entries under HTS subheading 8301.40.6030, the heading for locks used with interior or exterior doors.
Home Depot turned to General Rule of Interpretation 3(b) to stake its primary claim in the cases. GRI 3 says that goods consisting of multiple articles, each of which has its own HTS heading, can be classified under one tariff provision if the goods meet the following three criteria: consist of at least two different articles under two different headings, are made of articles put together to carry out a specific activity, and are put up in a way suitable for the direct sale to users without repackaging.
The plaintiff argued that since its goods meet all three of these requirements, the products are eligible for treatment under GRI 3(b), which would classify the good as if it was made of the material that gave it its "essential character." As this is the entry door knob component, the imports should be classified under HTS subheading 8302.41.6045, which provides for “[b]ase metal mountings, fittings and similar articles suitable for furniture, doors, staircases, windows, blinds, coachwork, saddlery, trunks, chests, caskets or the like," dutiable at 3.9%.
Home Depot's alternative argument leans on GRI 3(c), which says that when the goods can't be referenced by GRI 3(a) or 3(b), they shall be classified by whichever subheading occurs last in numerical order among those that merit equal consideration. Seeing as CBP's preferred 8301 heading and Home Depot's 8302 heading merit equal consideration, the trade court should uphold classification under heading 8302 as it occurs last in numeral order, the brief said.