March 10 & 17 CBP Bulletin Notices on Karaoke Machines, Certain Multiple Switches, and Grant of Lever-Rule Protection to Tomy Corporation

CBP states that any party who has received a contrary ruling or decision on the merchandise that is subject to the proposed revocations or modifications, or any party involved with a substantially identical transaction, should advise CBP by April 9, 2004, the date that written comments on the proposed rulings are due.

Furthermore, CBP states that an importer's failure to advise CBP of such rulings, decisions, or substantially identical transactions may raise issues of reasonable care on the part of the importer or its agent for importations subsequent to the effective date of the final decision in these notices.

CBP also states that these notices cover any rulings on the subject merchandise that may exist but have not been specifically identified.

Proposed Revocation of Two Classification Rulings

Karaoke Machines. At issue in proposed HQ 966608 are two models of karaoke machines, models STVG-500 and SMVG-600. Noteworthy distinctions between the two models are that model STVG-500 contains a cassette player/recorder which allows the user to record his performance, while model SMVG-600 contains a built in video camera but no recording capability.

CBP states that at issue in proposed HQ 966976 is model 159678, which contains a cassette player/recorder which allows the user to record his performance.

CBP is proposing to issue HQ 966608 in order to revoke NY I87338 and reclassify the STVG-500 under HTS 8543.89.96 as "other electrical machines and apparatus, having individual functions, not specified or included elsewhere in Chapter 85" and the SMVG-600 under HTS 8519.99.00 as "other sound reproducing apparatus, not incorporating a sound recording device" rather than classifying both under HTS 8528.22.0000 which provides for "black and white or other monochrome video monitors."

CBP is also proposing to issue HQ 966976 in order to revoke NY I85746 and reclassify model 159678 under HTS 8543.89.96 rather than under HTS 8520.33.00 which provides for "other cassette type magnetic tape recorders incorporating sound reproducing apparatus."

CBP states that it finds that the karaoke machines are composite machines within the meaning of HTS Section XVI, Note 3. Furthermore, pursuant to General Rule of Interpretation (GRI) 1 and Section XVI, Note 3, CBP finds that the principal function of the karaoke machines is determined by their sound reproducing function. Therefore, CBP states that the karaoke machines should be classified as described above.

proposed: 8543.89.96, 2.6% (models STVG-500 and 159678); 8519.99.00, duty-free (model SMVG-600).

current: 8528.22.0000, 5% (models STVG-500 and SMVG-600); 8520.33.00, duty-free (model 159678).

Proposed Modification of Two Classification Rulings

Certain Multiple Switches. CBP is proposing to issue HQ 966188 to modify HQ 964533 regarding the classification of certain automotive multiple switches consisting of three individual switches joined in a common housing. While the classification result in HQ 964533 was correct (HTS 8537), CBP states that its interpretation of Universal Electronics, Inc. v. U.S. therein was erroneous.

Therefore, CBP states that it is proposing to affirm the classification of the switches under HTS 8537 based on the plain language of HTS 8537 and its analysis in proposed HQ 966188, rather than its interpretation of Universal Electronics.

CBP is also proposing to issue HQ 966298 in order to modify HQ 958708 to affirm its classification of certain membrane switch assemblies under HTS 8537, and newly clarify the reasoning therefore.

Grant of "Lever-Rule" Protection to Tomy Corp for Table-Top Radio Control Cars

CBP has issued a notice announcing that it has granted ''Lever-Rule'' protection to Tomy Corporation for CHAR-G table-top radio control cars.

CBP states that in accordance with the holding in the Eleventh Circuit case of Davidoff & CIE v. PLD Int'l Corp., CBP has determined that the aforementioned gray market products differ physically and materially from the CHAR-G products authorized for sale in the U.S. in several respects including in the construction, structure, operational characteristic and performance. Additionally, the gray market products do not meet the U.S. legal/regulatory requirement in contrast to the U.S. authorized products.

According to CBP, importation of the subject CHAR-G table-top radio control cars is restricted, unless the labeling requirements of 19 CFR 133.23(b) are satisfied.

(See ITT's Online Archives or 07/16/03 news, 03071635, for BP summary of CBP's notice announcing receipt of the application for Lever-Rule protection.)

(In light of the 1993 court decision in Lever Bros. Co. v. U.S., CBP issued a final rule (T.D. 99-21) in February 1999 that, upon application by the U.S. trademark owner, restricts the importation of certain gray market articles that bear genuine trademarks identical to or substantially indistinguishable from those appearing on articles authorized by the U.S. trademark owner for importation or sale in the U.S., and that thereby create a likelihood of consumer confusion, in circumstances where the gray market articles and those bearing the authorized U.S. trademark are physically and materially different. (See ITT's 02/24/99 news, 99022325, for BP summary of T.D. 99-21.)

March 10, 2004 CBP Bulletin (Vol. 38, No. 11) available at http://www.cbp.gov/xp/cgov/toolbox/legal/bulletins_decisions/bulletins_2004/vol38_03102004_no11/ (karaoke machines and certain multiple switches)

March 17, 2004 CBP Bulletin (Vol. 38, No. 12) available at http://www.cbp.gov/xp/cgov/toolbox/legal/bulletins_decisions/bulletins_2004/vol38_03172004_no12/ (Lever-Rule protection)