Opinion ID: 590027
Heading Depth: 2
Heading Rank: 1

Heading: Fungibility and the American Hardboard Standard

Text: 20 In American Hardboard, the court considered the legislative history as embodied in the Tariff Classification Study to determine the meaning of the term hardboard. According to the study: 21 Hardboard is used chiefly in construction, in cabinet and millwork, in furniture and fixtures, and other fabricated and industrial products, in transportation equipment, for display purposes, in games, toys, and sporting products; also a high-density type of hardboard is used for dies in spinning and forming light-gauge metals, for jigs and templates, and for structural electrical-insulation materials. 4 Tariff Classification Study 67. The court concluded 22 that the hardboard designated eo nomine is a basic, fungible material capable of being used for a variety of functions.... This legislative history indicated that at some point the material designated as hardboards and provided for eo nomine under 245.30, TSUS, may no longer be within that classification because it has been advanced beyond a basic, fungible material and has become a new and different article of commerce. 23 Id. at 716. The court found the merchandise was suitable only for use as interlocking siding in construction.... and was, therefore, advanced beyond the basic, fungible material known as hardboard.... Id. at 717 (emphasis added). 24 The Court notes that by using the expression basic, fungible material in American Hardboard, it did not intend to imply that hardboard classifiable under TSUS item 245.30 must be interchangeable or substitutable with hardboard from another manufacturer in the sense that sand or wheat may be a fungible commodity. Rather, the court meant only that hardboard is an input material commercially susceptible to a variety of uses. 25 Based on the result in American Hardboard, the government maintains that since plaintiff's merchandise is suitable for more than a single use, it is necessarily an input material rather than a manufactured article. Although the American Hardboard court found the plastic spline permanently attached to the siding made it suitable only for use as interlocking siding in construction, this factual finding was addressed to the merchandise at issue and did not state a general proposition of law. Rather, whether merchandise is classifiable as hardboard under item 245.30, TSUS, depends on the factual advancements unique to the merchandise. American Hardboard, 12 CIT at 717. 26 Here, the Court has found that 90% of plaintiff's merchandise is put to its intended use as wall or ceiling covering. The question is whether the use of the remaining 10% is sufficient to make the merchandise an input material rather than a manufactured article.