HQ 229254

### March 13, 2002

### LIQ-9-01-RR:CR:DR

229254 RDJ

CATEGORY: LIQUIDATION

Port Director of Customs

Mr. John Quealy

1901 Cross Beam Dr.

Charlotte, NC 28217

> RE: Application for further review of Protest No. 1512-01-100037
> Importer
>
> of Record Michael Weinig, Inc.; 19 U.S.C. 1520(c)(1); mistake of fact;
> reliquidation; 19 U.S.C. 1514 mistake of law.

Dear Mr. Quealy:

This is in reference to Protest No. 1512-01-100037 received in OR&R on
August 3, 2001. It concerns 43 entries submitted by the importer of
record, Michael Weinig, Inc. [^1]The protest was filed by its broker,
American Emo Trans. (AET) on June 1, 2001.

**[FACTS:]{.underline}**

Protest no. 1512-01-100037 was filed by American Emo Trans. (AET) as a
Request for Further Review at the Port of Charlotte on June 1, 2001. It
involves 43 entries of machinery described as woodworking
machines,"moulders & grinders". The merchandise was entered between
November 5, 1998 and October 8, 1999. Upon entry, the importer
classified the merchandise as "moulders" under subheading 8465.92.0003,
HTSUS, at 3% ad valorem. The classification for moulders is specifically
provided ("eo nomine") under the stated subheading of the HTSUS.

AET submits this protest claiming that the port erred in denying three
1520(c) claims filed on these 43 entries. AET claims that it
misclassified and incorrectly valued the merchandise due to a "mistake
in fact". AET claims that, at the time of entry, they acted under the
belief that the merchandise was "used" machinery and classified it
incorrectly under subheading 8465.92.0003, HTSUS, at 3% ad valorem. AET
stated that "since the moulders are, in reality, " new equipment", the
merchandise should have been classified under subheading 8465.10.0045,
HTSUS at a rate of 2.5% ad valorem. AET argues the items being "new" is
a distinction that merits its reclassification and that they
"mistakenly" believed the moulders to be "used" machinery. They alleged
that a "mistake in fact" resulted in the misclassification of the
moulders and the overpayment of duties". AET alleged that they also
"mistakenly believed that the value of the machine tools was not
included in the value of the machine when, in fact, it was included"
(see, letter titled "520 with Attachments, Detailed Reasons for
520c"dated January 30, 2001).

In support of their arguments AET submits the entry documents, a letter
from Mr. Peter Fritsch (Michael Weinig, Inc.) stating that Michael
Weinig, Inc. has never imported "used" machinery from their parent
company in Germany. In its petition AET explains that "due to a mistake
in fact" AET *"mistakenly believed the moulders to be used
machinery.....this mistake in fact resulted in the misclassification of
the moulders and the overpayment of duties..AET ...mistakenly believed
that the value of the tools was not included in the* *value of the
machine, when in fact, it was included*"...*the transaction value of the
merchandise was overstated* *resulting in the overpayment of duty.."*(
as per document titled "520C with Attachments, Reasons for 520c"signed
by Cristy King, American Emo Trans. Inc). In the affidavit dated May 5,
2001 also by Ms. Cristy King, the affiant states " *AET Inc. as the
customs broker for Michael Weinig Inc. believed that all the woodworking
machinery imported from Germany was "used" machinery...due to this
mistake in fact..the importer...overpaid duties"...(P)lease reconsider
your decision....as this was a mistake of fact and AET, Inc. believed
that the goods were imported as used machinery and was never told
anything to the contrary...AET classified the machines as what we
believed the machines to be and the result was a gross* *overpayment of
duties*...On letter dated June 1, 2001, the AET states *" please
reconsider your denial of the protests and 520(c)'s on the basis of
classification and value errors...(A)s the broker and forwarder for
Michael Weinig Inc., we believed the machinery (moulders and grinders)
were used when we imported them.."....We are the bonded warehouse for
the importer and on several occasions, the import department would need
to physically look at the freight. It was on these occasions that we
thought the freight looked used and we were classifying them
correctly."*

This protest consists of a Request for Further Review of THREE separate
claims under 1520(c)(1) which the Port of Charlotte denied on separate
occasions. Our analysis follows.

Claim number 1512-01-200010, request for reliquidation under 1520(c) was
submitted to the Port of Charlotte on January 30, 2001. The claim was
denied on March 5, 2001for "it being a claim not correctable under
1520(c). The claim contained the following 24 entries:

**[ENTRY:]{.underline} [LIQUIDATION DATE:]{.underline}**

1\) GF5- XXXX0728 2/25/00

2\) GF5-XXXX0041 2/11/00

3\) GF5-XXXX1254 3/03/00

4\) GF5-XXXX6006 3/03/00

5\) GF5-XXXX0678 3/03/00

6\) GF5-XXXX1775 3/10/00

7\) GF5-XXXX2302 3/17/00

8\) GF5-XXXX2807 3/24/00

9\) GF5-XXXX3227 3/31/00

10\) GF5-XXXX3714 4/07/00

11\) GF5-XXXX4076 4/14/00

12\) GF5-XXXX4498 4/21/00

13\) GF5-XXXX4597 4/28/00

14\) GF5-XXXX4605 4/28/00

15\) GF5-XXXX6444 5/19/00

16\) GF5-XXXX7269 6/02/00

17\) GF5-XXXX7715 6/09/00

18\) GF5-XXXX5495 6/16/00

19\) GF5-XXXX8598 6/23/00

20\) GF5-XXXX8929 6/30/00

21\) GF5-XXXX9711 7/14/00

22\) GF5-XXXX1105 8/04/00

23\) GF5-XXXX1519 8/18/00

24\) GF5-XXXX9803 02/04/00

Claim \# 1512-01-200009, request for reliquidation under 1520(c) was
submitted to the Port of Charlotte on January 30, 2001. It was denied on
March 2, 2001. It involved the following

4 entries:

**[ENTRY \#]{.underline} [LIQUIDATION DATE]{.underline}**

25\) GF5-XXXX6098 12/27/99

26\) GF5-XXXX4432 11/03/99

27\) GF5-XXXX6213 11/26/99

28\) GF5-XXXX7484 12/27/99

Claim \# 1512-00-200025 was submitted on August 16, 2000 and denied on
October 11, 2000.

It involved the following 8 entries:

**[ENTRY \#]{.underline} [LIQUIDATION DATE]{.underline}**

29\) GF5-XXXX259-2 07/30/99

30\) GF5-XXXX280-8 08/06/99

31\) GF5-XXXX318-6 08/20/99

32\) GF5-XXXX343-4 08/27/99

33\) GF5-XXXX361-6 09/03/99

34\) GF5-XXXX386-3 09/10/99

35\) GF5-XXXX387-1 09/10/99

36\) GF5-XXXX416-8 03/12/99

PROTEST NUMBER 1512-01-100037 involves all of the above entries PLUS the
following

6 entries:

**[ENTRY \#]{.underline} [LIQUIDATION DATE]{.underline}**

37\) GF5-XXXX825-0 01/14/00

38\) GF5-XXXX944-9 01/28/00

39\) GF5-XXXX759-1 01/03/00

40\) GF5-XXXX878-9 01/21/00

41\) GF5-XXXX297-2 08/13/99

42\) GF5-XXXX862-3 01/07/00

43\) GFS-XXXX684-0 05/26/00

**[ANALYSIS]{.underline}:**

**Were the claims made under 1520(c)(1) properly denied by the Port?**

[**A) ENTRIES COVERED UNDER CLAIM \# 1512-01-200010:**]{.underline}

For entries contained in claim 1512-01- 200010 the PROTEST was submitted
TIMELY on June 1, 2001, that is, within 90 days from the decision by the
port (March 5, 2001) denying the re-liquidation of the stated entries
under 1520(c). We now review these entries under the provisions of 19
U.S.C. 1514 (a)(7).

Michael Weinig, Inc. importer of record, entered certain merchandise
which was classified upon entry as "moulders and grinders". These items
were classified by the broker, AET, upon entry under subheading
8465.92.0003 HTSUS at 3% ad valorem. The classification for moulders is
specifically provided ("eo nomine") under the stated subheading of the
tariff schedule. These entries liquidated "as entered" on or before
August 18, 2000.

On January 30, 2001, American Emo Trans. ("AET") submitted **a timely**
claim under section 1520(c)(1) requesting the reliquidation of the 24
entries listed due to an alleged "mistake in fact" in the classification
of the items imported. Section 1520(c)(1) requires that any request to
reliquidate be made within one year of the liquidation. In order for an
importer to obtain relief under section 1520(c)(1), the request must be
filed timely and is required to fulfil the criteria set by the statute.
On March 5, 2001, the port denied the reliquidation alleging that "this
claim is not correctable under section 520(c)(1)".

Under section 1520(c), Customs may reliquidate an entry to correct a
clerical error, mistake in fact or other inadvertence, not amounting to
an error in the construction of law. Section 1520(c)(1) was designed to
permit importers to correct mistakes of fact or inadvertence which have
caused an error in liquidation.

Section 1520 (c)(1) provides:

\(c\) Notwithstanding a valid protest was not filed, the appropriate
customs officer may \* \* \* reliquidate an entry to correct---

(1) a clerical error mistake of fact or other inadvertence not amounting
    to an error in the construction of law, adverse to the importer and
    manifest from the record or established by documentary evidence, in
    any entry, liquidation, or other Customs transaction, when the
    error, mistake or inadvertence is brought to the attention of the
    appropriate Customs officer within one year from the date of
    liquidation or exaction.

A mistake in fact has been defined as a mistake which takes place when
some fact which indeed exists is unknown, or a fact which is thought to
exist, in reality does not exist". [C.J. Tower & Sons of Buffalo, Inc. v
U.S]{.underline}. 68 Cust. Ct. 17, 22, C. D. 4327, 336 F. Supp. 1395
(1972), 490 F.2d. 1277 (1977). The courts have consistently held that
section 1520(c)(1) may only be used to correct mistakes of fact or
inadvertence such as clerical or ministerial errors and may not be used
to rectify incorrect interpretations of the law ([Hambro Automotive
Corp. v .U.S.]{.underline} 66 CCA 113, 120 C.A.D. 1231, 603 F.2d 850,
855 (1979); [PPG Industries, Inc. v. U.S.]{.underline} 7 CIT 118, Slip
Op. 84-27; [Mattel Inc. v. U.S.]{.underline} 72 Cust Ct. 257, 262 , 377
F.Supp. 955, 960 (1974). Section 1520 (c)(1) is not an alternative to
the normal liquidation protest method of obtaining review" but rather
affords "limited relief" where an unnoticed or unintentional error has
been committed [(Computime Inc. v. U.S.]{.underline} 9 CIT 553 (1985)
citing. [C.J. Tower & Sons,]{.underline} 336 F. Supp. p.1398). The
relief provided under 1520(c)(1) is not an "alternative" to the relief
provided for in the form of protests under 19 U.S.C. 1514. In order to
qualify for relief under 1520(c)(1), the claimant must prove that there
is a mistake in fact which establishes that the entry and liquidation
were incorrectly made. Mistakes of fact occur in instances where either
(1) the facts exist but are unknown, or (2) the facts do not exist as
they are believed to. The conditions required to be met under 1520(c)(1)
are that the clerical error, mistake of fact, or other inadvertence must
be adverse to the importer, manifest from the record or established by
documentary evidence and brought to the attention of Customs within one
year after the date of liquidation. It is imperative that documentary
evidence be presented to support the allegation of the existence of a
mistake in fact.

When AET submitted its timely request for relief under section
1520(c)(1) on January 30, 2001, AET stated that, at the time of entry,
they acted under the belief that the merchandise was "used" machinery
and as such, classifiable under suheading 8465.92.0003, HTSUS, at 3% ad
valorem. AET stated that "since the moulders are, in reality, "new"
equipment", the merchandise should have been classified under subheading
8465.10.0045, HTSUS at a rate of 2.5% ad valorem. They alleged that a
"mistake in fact" resulted in the misclassification of the moulders and
the overpayment of duties". AET also alleged that the value of the
machine tools was not included in the value of the machine when, in
fact, it was included" (see, letter titled "520 with Attachments,
Detailed Reasons for 520c"dated January 30, 2001).

Upon review of these arguments, the port correctly denied the 1520(c )
claim because these allegations involved which involved *the
construction of law* involving the correct classification and value.
Arguments involving the construction of law must be filed under section
1514. AET failed to submit a timely 1514 protest within 90 days of the
date of liquidation in order to address these particular issues.

As initially classified, the merchandise consisted of "moulders". The
stated classification is the one provided for that specific item, eo
nomine. Therefore, it was Customs' position that the merchandise was
correctly classified by AET at the time of entry. When the entries
liquidated, Customs accepted the importer's classification. Customs
determined that "moulders" are only classifiable under the stated
subheading and, as such, concluded that the classification and value
were correctly assessed. Having failed to submit a timely 1514 protest,
AET attempted to address these issues by submitting a claim under
1520(c)(1) alleging that the classification was a result of a "mistake
in fact". However, even if we conclude that there was no "mistake in
law" (that should have been resolved by means of a protest under 1514
filed within 90 days of the liquidation), the evidence in file is
insufficient to prove that a "mistake in fact" occurred under section
1520(c)(1).

It has generally been established that mistakes in classification of
merchandise are considered mistakes in the construction of law and not
correctable under 1520(c)(1) ([Mattel, Inc. v. U.S.]{.underline} 377 F.
Supp. 955 (1974). Under section 1514, errors in classification,
valuation, etc., of merchandise can be corrected and refund of duties be
granted if the protest is submitted within 90 days of the liquidation of
the entry. Failure to file a protest within the specified period of
time, will render the liquidation final and binding to both the
government and the importer. However, Congress has established a limited
relief under which certain mistakes can be corrected by applying the
precepts established in section 1520(c)(1) [(Phillips Petroleum Co. v.
US.]{.underline} 54 CCPA 7, 11 (1966)). Under this section , an entry
can be reliquidated to correct a clerical error, mistake of fact, or
other inadvertence not amounting to an error in the construction of law
([Computime Inc. v. U.S.]{.underline} 9 CIT 554, 555 citing [Hambro
Automotive Corp. v. U.S.]{.underline} 66CCPA113, 120, C.A.D.1231, 603
F.2d. 850, 855(1979); [PPG Industries, Inc. v U.S.]{.underline} 72 Cust.
Ct 257, 262-263; [Fibrous Glass Products v U.S.]{.underline} 63 Cust.
Ct. 62, 63-64 C.D. 3874 (1969) appeal dismissed 57 CCPA 141(1970) . The
error must be adverse to the importer and brought to the attention of
the appropriate Customs officer within one year from the date of
liquidation . The error must be manifest or established by documentary
evidence. It is the affirmative burden of the protestant to establish
the nature of the error and demonstrate that it falls within the scope
of the statute. It is understood that a claim under section 1520(c)(1)
should not be construed "as an alternative to the normal liquidation
protest method of obtaining review"([Computime Inc, v U.S.]{.underline}
9 CIT 553, 556(1985)). It is not the purpose of section 1520(c)(1) to
extend the period for filling objections to issues which are redressable
under section 1514.

In the present case, if the question was whether the distinction between
"new" and "used" resulted in a change of classification for "moulders",
then the issue becomes a question of interpretation of law which should
have been addressed under section 1514 within 90 days of the
liquidation. In other words, in order for Customs to accept a
reliquidation of these entries, Customs would have had to, first,
determine if "moulders" could be classified in any other manner other
than as "moulders" and secondly, whether "new or used" criteria affected
the classification. The scope of this analysis would have definitively
encompassed a legal interpretation of the tariff schedule. A legal
interpretation would have also been necessary had AET alleged the
appraisement of this merchandise was incorrect. If Customs would have
been required to make such an analysis, the only legal procedure
available for the importer, would have been the submission of a 19
U.S.C. 1514 protest. Since the entries liquidated and no 1514 protests
were timely filed, the legal interpretation of the HTSUS is final and
conclusive.

Putting aside the issue as to whether the request for classification was
a mistake of law redressable only under section 1514 , we turn our
analysis as to whether a mistake in the classification could be
redressable as a "mistake in fact" under section 1520(c)(1). We have
stated that the conditions to be met under 1520(c)(1) are that the
liquidation was incorrect and that it was caused by a clerical error,
mistake in fact or other inadvertence. The inadvertence, mistake in fact
or clerical error must be adverse to the importer, manifest from the
record, or established by documentary evidence. In this case, AET filed
a timely claim under 1520(c)(1

on January 30, 2001. AET contends that they believed that the "moulders"
were "used" instead of "new". AET had initially classified the
"moulders" as "moulders" under subheading 8465.92.0003 HTSUS at 3% ad
valorem. As part of the allegations under 1520(c)(1) AET argued that
there is a distinction between "new" and "used" in terms of the
classification and the "moulders" should have been classified as "new"
equipment under subheading 8465.10.00045, HTUS, at a rate of 2.5% ad
valorem. They describe their "mistake in fact" as an erroneous belief
that the merchandise entered was "used" instead of "new".

In analyzing the [evidence]{.underline} presented, we conclude the
following. First, we find that AET correctly classified the merchandise
at the time of entry. The "moulders" are "specifically provided" under
subheading 8465.920003, HTSUS no other classification would have been
correct for the merchandise described. A machine can only be classified
under subheading 8465.10.0045 if it can carry out different types of
machinery operations without a tool change between operations. The
documents provided give no indication that the imported machines were
capable of carrying out the machinery operations as described under
subheading 8465.10.0045. Moulders are not considered that type of
machine. Secondly, AET has failed to provide sufficient evidence of the
existence of a "mistake in fact" that would [be manifest]{.underline}
from the record or established by documentary evidence. Upon an
assertion that a certain merchandise has been wrongly classified due to
a "mistake in fact" , it is incumbent on the plaintiff to show by
[sufficient evidence the nature of the mistake in fact]{.underline}
([PPG Industries, Inc. v. U.S.]{.underline} 4 CIT 143, 147 (1982) citing
[Hambro Automotive Corp v U.S.]{.underline} 81 Cust. Ct. 29, 31, 458 F.
Supp 1220, 1222 (1978) aff'd 66 CCPA 113, C.A.D. 1231, 603 F. 2d. 850
(1979). Mere assertion without supporting evidence will not be regarded
as sufficient to overturn a Customs decision ([Bar Bea Truck Leasing Co.
Inc. v. U.S.]{.underline} 5 CIT 124, 126 (1983). In [ITT Corp. v.
U.S.]{.underline} 24 F.3^rd^ 1384, 1387 (Fed. Cir 1994), the court
stated that a request for reliquidation under 1520(c)(1) requires both
notice and substantiation. In [ITT v U.S.]{.underline} at p.1387, the
court stated that mistakes in fact that are not manifest, must be
established by documentary evidence and by citing the
[Hambro]{.underline} case, "with sufficient particularity to allow
remedial action". The mistake in fact must be described in detail in
order to prove that a factual error rather than a legal error existed.

We find that no documentary evidence has been presented to support the
assertion of a mistake in fact. It is the claimant who bears the burden
of establishing [the underlying facts]{.underline} needed to prove the
allegation of a mistake in fact. We find that the statements made by Ms.
King (cited above) comprise of mere assertions which do not sustain the
allegations presented. We find that the affidavit is insufficiently
supported by the record and, at best, contradictory. See [Andy Mohan,
Inc.. American Customs Brokg.Co. Inc. v. U.S.]{.underline} (63 C.C.P.A
104, 537 F.2d. 516) where it is noted that affidavits are entitled to
little weight if determined to be incomplete or based on unproduced
records. The invoices contained in the file from Michael Weinig, Inc.
(Germany) do not contain any information that would substantiate AET's
belief that this company was importing "used machinery" from the parent
company in Germany. Neither the entries or the invoices contain any
distinction as to the nature of the items imported. As a matter of fact,
a letter addressed to Customs dated July 24, 2001 by Mr. Peter Fritsch,
states *that "Michael Weinig, Inc. does not and has never, imported
"used" machinery from our parent company, Weinig, Inc in Germany".* This
assertion is contrary to AET's allegation in the affidavit stating that
"*AET* *believed that all the woodworking machinery imported from*
*Germany was "used*".

We do not find that the invoices were misleading in any way nor did
these supplied erroneous or confusing information which would have
enabled the broker to misunderstand the nature of the merchandise. Most
importantly, the distinction between "new" or "used" is irrelevant to
the classification. Mr. Fritsch is incorrect in believing that the
merchandise was entered as "used" because it is not a distinction that
appears in the Customs entry document, the CF7501 nor it affected the
classification. In the Harmonized Tariff Schedule, the 'used" or "new"
are simply designations (at the 10-digit level) which are used
domestically for statistical purposes. Since the tariff rate is
determined at the 8-digit level, the stated designation does not affect
classification or value. We conclude that the broker **CORRECTLY**
classified the merchandise *at the time of entry*. AET was never under a
mistaken impression of a "fact" or even "law", because the
classification and value were correctly determined at the time of entry.
In terms of the value, we find no evidence of the broker's allegation
that the transaction value was overstated. According to the CF7501 the
machinery was listed as a separate line distinct from whatever tools
were entered at the time. If the importer was interested in challenging
the stated value, the importer only needed to file a 1514 protest within
90 days of the liquidation as a mistake in the construction of the law.
Since AET failed to file a 1514 protest timely, the legal determination
concerning the classification and valuation is now final and conclusive.
As in Computime v. U.S. (9 CIT 555, 556 (1985), the plaintiff did not
avail itself to the appropriate statutory remedy.

**[B) Claim \# 1512-01-200009]{.underline}:**

A claim under 1520(c)(1) was **filed untimely** on January 30, 2001.
These five entries liquidated and more than a year passed before the
broker filed the 1520(c)(1) claim. The port denied relief on March 2,
2001. The PROTEST was submitted on June 1, 2001. We deny review of these
entries because the claim under 1520(c)(1) was filed untimely at the
port since it was filed more than a year after the entries had
liquidated.

C\) Claim \# 1512-01-200025:

The section 1520(c)(1) claim #1512-00-200025 involved 8 entries and the
port denied relief on October 11, 2000. The PROTEST (1512-01-10037) was
**filed untimely** on June 1, 2001, more than 90 days from the date of
the decision by the port to deny the 1520(c)(1) request. We deny review
of this claim for it being filed untimely.

D)  **[SIX ENTRIES INCLUDED IN PROTEST 1512-01-100037:]{.underline}**

We deny review of these entries. These entries liquidated between August
13, 1999 and January 28, 2000 and no protest under section 1514 was
filed within 90 days of the liquidation and no petition under 1520(c)(1)
claim was timely filed within one year of the liquidation.

Protest is denied for lack of jurisdiction.

**[HOLDING:]{.underline}**

The PROTEST 1512-01-100037 is [DENIED]{.underline} and relief may not be
granted under

19 U.S.C. 1514(a)(7) for the reasons stated in our analysis.

Consistent with the decision set forth above, you are hereby directed to
deny the subject protest. In accordance with Section 3(A)(11)(b) of
Customs Directive 099 3550-065, dated August 4, 1993, Subject: revised
Protest Directive, this decision should be mailed by your office to the
protestant no later than 60 days from the date of this letter. Any
reliquidation of the entry in accordance to with the decision must be
accomplished prior to mailing the decision. Sixty days from the date of
the decision available to customs personnel via the Customs Ruling
Module in ACS and the public via the Diskette Subscription Service,
Freedom of Information Act and other public access channels.

Sincerely,

John Durant

> Director, Commercial Ruling Division

[^1]: Entry numbers GF5-XXXX8192 and GF5-925-8 were not listed in
    1512-01-100037.