CIT Rules That Certain Christmas and Halloween Sweaters Are Duty- and Quota-Free in HTS 9505
The Court of International Trade has issued a decision in the case Michael Simon Design, Inc. v. U.S. which upholds the importer's view that sweaters with certain Christmas or Halloween motifs are classified as "festive articles" in Harmonized Tariff Schedule (HTS) 9505 (duty- and quota-free).
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U.S. Customs and Border Protection (CBP) had argued that the sweaters are classified in HTS 6110.
CIT Gives No Skidmore Deference to CBP in This Case
The CIT states that it did not give Skidmore deference to CBP's long held position that HTS 9505 excludes items whose primary function is utilitarian, despite an amended Explanatory Note (EN 95.05), which specifically excludes apparel from "festive articles". According to the CIT, CBP's position lacks the power to persuade, in part due to the reasoning in CBP's denial of the importer's protest, among other things.
Amended EN Contradicts Prior CAFC Rulings That "Festive Articles" Include Utilitarian Articles
In addition, the CIT states that its own analysis rejects the application of the amended EN 95.05, as it contradicts the Court of Appeals for the Federal Circuit's (CAFC) interpretation of the scope of HTS 9505. The CAFC's decisions in Park B. Smith and Midwest held, without qualification, that the term "festive articles" includes utilitarian articles (e.g, earrings, table linens, mugs, and rugs).
Subject Sweaters with Christmas and Halloween (Spider, Bat, Ghost) Motifs Qualify as "Festive Articles"
As a result, the CIT has ruled that the subject Christmas and Halloween (with Spider, Bat, or Ghost motifs) sweaters qualify as festive articles as they satisfy the CAFC's Park B. Smith and Midwest criteria, specifically that they are (1) closely associated with a festive occasion and (2) the article is used or displayed prinicipally during that festive occasion. Additionally, they are closely associated with a festive occasion to the degree that their use during other time periods would be aberrant.
The CIT also decided that the sweaters with a "Black Cat" motif are not "festive articles" of HTS Chapter 95. Although associated with Halloween, they are not "closely associated only with Halloween" and use of the black cat symbol at other times of the year would not be aberrant.
(See ITT's Online Archives or 04/25/06 news, 06042505 for BP summary of CBP's Classification/Protest Guidance on Textile and Non-Textile Festive Articles, including instructions on requesting suspension of liquidation and/or the filing ofprotests.
This guidance also lists seven court cases before the CIT, which involve the classification of various articles as festive (including the instant court case).
See ITT's Online Archives or 04/13/06 news, 06041310 for BP summary of CBP's notice on its limiting the Park decision to the litigated entries only.)
CIT Slip Op. 06-128, dated 08/24/06, available at http://www.cit.uscourts.gov/slip_op/Slip_op06/06-128.pdf