Case Name: David Studner et al. v. United States
Court: United States Customs Court
Jurisdiction: United States
Decision Date: 1969-07-08
Citations: 63 Cust. Ct. 1
Docket Number: C.D. 3865
Parties: David Studner et al. v. United States
Judges: Before Rao, Ford, and Newman, Judges; Newman, J., dissenting
Reporter: United States Customs Court Reports
Volume: 63
Pages: 1–12

Head Matter:
(C.D. 3865)
David Studner et al. v. United States
United States Customs Court, Second Division
(Decided July 8, 1969)
Siegel, Mandell & Davidson (Allan H. Kamnitz of counsel) for the plaintiffs.
William, D. Rueloelshaws, Assistant Attorney General ( Velta A. Melnbrencis, trial attorney), for the defendant.
Before Rao, Ford, and Newman, Judges; Newman, J., dissenting

Opinion:
Nao, Chief Judge:
The merchandise involved herein is described on the invoices and entries as "old printing blocks" or as "wooden printing blocks". It was assessed with duty at 40 per centum ad valorem under paragraph 395 of the Tariff Act of 1930, as modified by the General Agreement on Tariffs and Trade, 82 Treas. Dec. 305, T.D. 51802, as print blocks or print rollers, not specially provided for, of whatever material composed, used for printing, stamping, or cutting designs.
Two claims are made in the protests, as amended: That the merchandise is properly dutiable at 4 per centum ad valorem under paragraph 1555, as modified by the Torquay Protocol to the General Agreement on Tariffs and Trade, 86 Treas. Dec. 121, T.D. 52739, as waste, or that it is dutiable at 19 per centum ad valorem under paragraph 397, as modified by the Sixth Protocol of Supplementary Concessions to the General Agreement on Tariffs and Trade, 91 Treas. Dec. 150, T.D. 54108, as articles, whether partly or wholly manufactured, composed wholly or in chief value of base metal.
The pertinent provisions of the Tariff Act of 1930, as modified, are as follows:
Paragraph 395, as modified by T.D. 51802:
Print blocks, of whatever material composed, used for printing, stamping or cutting designs- 40% ad val.
Paragraph 1555, as modified by T.D. 52739:
Waste, not specially provided for- 4% ad val.
Paragraph 397, as modified by T.D. 54108:
Articles or wares not specially provided for, whether partly or wholly manufactured:
*
Composed wholly or in chief value of base metal (except lead), but not plated with platinum, gold or silver, or colored with gold lacquer:
Hs *
Not wholly or in chief value of tin or tin plate:
‡ ‡ ‡ ‡
Other _ 19% ad val.
This case has been submitted on a stipulation of fact, reading as follows:
1. That the involved merchandise, which was classified within paragraph 395, Tariff Act of 1930, as modified, consists of old and used print blocks, incapable of use for its original purpose of printing. Without being manipulated in any manner, it is imported into this country.
2. That the involved merchandise in its imported condition is used and sold as wall decorations.
3. That the plaintiff claimed said merchandise is dutiable at 4 per centum ad valorem within paragraph 1555, Tariff Act of 1930, as modified, while the defendant claims the merchandise is dutiable at 19 per centum ad valorem within paragraph 397, of said Act, as articles not specially provided for, partly or wholly manufactured, wholly or in chief value of base metal, but not plated with platinum, gold, or silver or colored with gold lacquer.
4. That the involved merchandise is, in fact, wholly or in chief value of base metal, not plated with platinum, gold, or silver, or colored with gold lacquer.
From this stipulation it is evident that the merchandise was erroneously classified under paragraph 395, as modified, since the articles are no longer used or suitable for use for printing, stamping, or cutting designs. Defendant in fact does not claim that this classification should be sustained.
Plaintiffs urge that since the involved blocks were not processed in any manner prior to importation, they cannot be considered manufactured articles but are waste. Defendant contends that since they are neither items fit only for remanufacture nor refuse material resulting from a manufacturing process, they are not "waste" within the meaning of the tariff act and since they are in a "manufactured state", they are classifiable as articles, not specially provided for, whether partly or wholly manufactured, wholly or in chief value of base metal, under paragraph 397, as modified. The latter claim is the same as plaintiffs' alternate claim.
The principal issue is whether old or used print blocks, incapable of use for their original purpose of printing, but which were sold and used for a new purpose, as wall decorations, are "waste" within the meaning of the tariff act, as modified.
The classical definition of waste is found in Patton v. United States, 159 U.S. 500 (1895), where the court stated (p. 503) :
The prominent characteristic running through all these definitions is that of refuse, or material that is not susceptible of being used for the ordinary purposes of manufacture. It does not presuppose that the article is absolutely worthless, but that it is unmerchantable and used for purposes for which merchantable material of the Same class is unsuitable.
Another oft quoted statement appears in Harley Co. v. United States, 14 Ct. Cust. Appls. 112, T.D. 41644 (1926), at page 115 :
In the tariff sense, waste is a term which includes manufactured articles which have become useless for the original purpose for which they were made and fit only for remanufacture into something else. It also includes refuse, surplus, and useless stuff resulting from manufacture or from manufacturing processes and commercially unfit, without remanufacture, for the purposes for which the original material was suitable and from which material such refuse, surplus, or unsought residuum was derived. The latter class of waste might be appropriately designated as new waste and includes such things as tangled spun thread, coal dust, broken or spoiled castings fit only for remanufacture.
In that case and in a number of subsequent cases the merchandise consisted of worn-out or obsolete articles no longer suitable for their original purposes, which were in fact used or to be used for remanu-facture into something else:
Harley Co. v. United States, supra (rags of worn-out wearing apparel fit for nothing commercially except to be remanufac-tured — some into wiping rags, some into paper, and some into other commodities).
United States v. C. J. Tower & Sons, 31 CCPA 185, C.A.D. 271 (1944) (old, discarded junk X-ray films in chief value of cellulose acetate which had been exposed and developed and were no longer fit for use in taking X-ray or other pictures).
United States v. Katzenstein & Keene et al., 16 Ct. Cust. Appls. 93, T.D. 42754 (1928) (rags which were worn out by reason of use or wear and tear unsuitable for the purpose for which they were originally made and used for paper making).
The Midwest Waste Material Co. et al. v. United States, 28 Cust. Ct. 8, C.D. 1382 (1951) (woven strips of jute originally designed for use by the armed forces in the garnishing of nets for camouflage purposes, but no longer devoted to that use and consumed for their fiber content either for the making of jute felt or as paper stock).
Most imported merchandise classified as waste appears to be in the so-called "new waste" category. See Summary of Tariff Information, 1921, page 1212; Summary of Tariff Information, 1929, page 2153; Summaries of Tariff Information, 1948, volume 15, part 9, page 136. The 1948 publication states, for example, "Wastes are by-products (usually minor) not produced for their own sake." In the case of such "new waste" it has been held that merchandise which is usable in its imported condition without further manufacture is classifiable as waste. National Carloading Corp. v. United States, 22 Cust. Ct. 328, Abstract 53220 (1949), Cia Algodonera v. United States, 23 CCPA 42, T.D. 47686 (1935); Koons, Wilson & Co. v. United States, 12 Ct. Cust. Appls. 418, T.D. 40589 (1924); W.R. Grace & Co. v. United States, 9 Cust. Ct. 59, C.D. 662 (1942).
In the National Carloading case, the merchandise consisted of pieces of sisal fiber which fell off in the process of manufacturing and were unsuitable for use in manufacturing shoes, bags, or brushes. They were used in their imported condition as stuffing for furniture, mattresses, and the like. The court held they were waste, stating (p. 329) :
A waste material is not precluded from classification as a waste merely because it may be used in its imported condition without being subjected to further manufacture after it reaches this country.
In the Cia Algondonera case, the merchandise consisted of cottonseed hulls which were a necessary by-product produced in the course of the manufacture of cottonseed oil and meal. They were not further manufactured but were mixed with meal in small percentages and fed to cattle. The court held that they were waste, stating (p. 45) :
The cottonseed hulls are a by-product of the oil mills, necessarily produced in such oil mill operations. The fact that they are a valuable product, and are a distinct commercial entity, does not militate against the view that they are, in a tariff sense, waste.
In Koons, Wilson & Co. v. United States, supra, it was held that beet pulp, the dried residue from sugar beets after extraction of sugar, used for cattle feed, was dutiable as waste, and in W.R. Grace & Co. v. United States, supra, a by-product obtained as a result of manufacturing buttons from tagua nuts, used as a filler in explosives, was classifiable as waste.
The issue here is whether an old and used article no longer suitable for its original purpose and which would be considered waste if fit only for remanufacture (Pelton Enterprises, Inc., and Hoyt, Shepston & Sciaroni v. United States, 44 Cust. Ct. 381, Abstract 63935 (1960); D.M. Studner v. United States, 50 Cust. Ct. 149, C.D. 2404 (1963)) must be considered something else because it can be used for another purpose without remanufacture. Obviously, in most instances articles no longer suitable for their original purpose are usable for another only after remanufacture. Thus the issue persented here is an unusual one and apparently never squarely presented to the courts.
In P. Silverman & Son v. United States, 27 CCPA 324, C.A.D. 107 (1940), the merchandise consisted of "Old Woolen Dryer Felt Waste", that is, so-called Palmer or sanforizing blankets, which were in a worn- out condition and no longer serviceable for their original purpose. When new, they were used in textile finishing operations, but when discarded, they had become so worn and burnt by heat and friction as to render them unsuitable for their original purposes. The trial court stated that the record established that the merchandise was fit only for use, after manipulation, for wiping and abrasive purposes in the steel and optical glass industries. The appellate court noted that one of the special uses shown by the record was in the steel industry where the merchandise was used to brush away the oxidation of steel before it went into the roll. In order to be used for that purpose, the merchandise had to be cleaned of excessive grease and rust. The merchandise was held to be classifiable as waste, not specially provided for, rather than as wool waste.
While the court did not determine what constituted "waste", it laid down no requirement that fitness for remanufacture was necessary, and, by implication, included as waste, worn articles which had new uses after some manipulation, which may have been no more than cleaning.
In another series of cases it has been held that burlap bags which had been slit to remove their contents and were unfit for use as bags but were used as patches or as bale wrappers were dutiable as waste bagging. Rachman Bag Co., Inc. v. United States, 57 Cust. Ct. 465, C.D. 2838 (1966), and cases cited. The court there stated (p. 469) :
From the foregoing, it is evident that whether used bagging is to be regarded as bags or as waste bagging for tariff purposes depends, m the first instance, upon its condition at the time of importation and, in the second place, upon a comparison between its use in its original state and its susceptibility of use in its imported condition. Where, as here, the material imported is so deteriorated from its original form as to be incapable of use as containers, and the use to which it is commercially and practically adapted differs substantially therefrom, it is such a waste product as to fall naturally within the provisions of paragraph 1617, supra, for waste bagging.
We are of the opinion that the split bags here in issue must be so treated. In their imported condition, they cannot serve as containers. The mutilation they have undergone renders them unfit for such use, and the evidence establishes that they are not practically capable of reuse as bags. Indeed the testimony suggests that the subject split bags have been so drastically damaged in the removal of their original contents as to be incapable of being restored to their original condition.
In the instant case, the print blocks were incapable of use for their original purpose and were "waste" as far as their use in printing was concerned. They would have been considered "waste" if another use had been found for them that involved remanufacture. The use to which, they are in fact put differs substantially from their original use. "New waste" is classifiable as waste even though used for a different purpose without further manufacture. It would be illogical to hold that "old waste", such as this merchandise, has been taken out of the classification, waste, merely because it can be used for another purpose without remanufacture.
The provision for waste, not specially provided for, in paragraph 1555 of the Tariff Act of 1930, is without other limitation. It does not contain a proviso, such as that in paragraph 301, for example, "That nothing shall be deemed scrap iron or scrap steel except second-hand or waste or refuse iron or steel fit only to be remanufactured." See also paragraph 394 (old and worn-out zinc, fit only to be remanufac-tured) ; Public Law 81-869, 64 Stat. 1093, as amended; and items 911.10-911.12, Tariff Schedules of the United States. The restriction "fit only to be remanufactured" also occurs in earlier tariff acts. See paragraph 301, Tariff Act of 1922; paragraph 518, Tariff Act of 1913; paragraph 118, Tariff Act of 1909. It would appear, therefore, that when Congress intended to limit the terms "waste" or "scrap" to merchandise fit only for remanufacture, it so stated.
We conclude that the printing blocks involved herein are classifiable as waste under paragraph 1555 of the Tariff Act of 1930, as modified.
For the reasons stated, the protests are sustained and the merchandise is held properly dutiable at 4 per centum ad valorem under paragraph 1555 of the Tariff Act of 1930, as modified, as waste, not specially provided for. Judgment will be entered accordingly.