Opinion ID: 791960
Heading Depth: 3
Heading Rank: 2

Heading: HTSUS Classification

Text: 20 The parties' remaining arguments are directed to the issue of whether the properly-interpreted scope of HTSUS Heading 4202 or HTSUS Heading 4820 encompasses Avenues' imported folios. We address classification under each of these headings separately. 21
22 Regarding classification under Heading 4202, Customs argues that because the articles at issue satisfy the common definition of one of the eo nomine exemplars, briefcases, the Court of International Trade erred in concluding that the Calcu-Folios are not classified under section 4202. Customs further argues that, under a ejusdem generis analysis, the articles in question are classifiable under Heading 4202 because they possess the characteristics uniting all of the containers of that heading. 23 Avenues responds that the Court of International Trade correctly concluded that the Calcu-Folios are not a form of a briefcase, and properly rejected an ejusdem generis classification under Heading 4202 in view of its finding that the specific primary purpose of the Calcu-Folios is to facilitate taking of notes as well as to aid the organization of print and other visual flat materials. 24 While the Court of International Trade did not specifically state that the folios in question were not a form of briefcase, the court described the goods in question as pad folios, and, as such, concluded that they lack[ed] specific eo nomine classification in the HTSUS. CIT Opinion at 2, 2004 WL 897792. Thus, the court implicitly rejected their classification as a form of a briefcase. Based on its observation that the folio pockets were essentially flat, the court found the article suitable only for holding loose papers, files and other flat items such as business cards, floppy discs, et cetera. Id. at 16, 2004 WL 897792. The court also acknowledged the testimony of Avenues' witness, Shor, stating that 25 [Shor] explained that pad folios are not briefcases, which are designed to carry various business-related as well as personal articles..., nor are they attache cases, which are hard-sided rectangular cases.... He described them as covers and carriers designed to hold and organize paper products and flats such as cards, envelopes, photographs, file folders, thin catalogues, et cetera, capable of being fit within the pad folio's pockets and sleeves. 26 Id. at 4, 2004 WL 897792. 27 The trial court also found that while the article could be used to carry personal objects that would normally be carried in a briefcase, the article was not designed to do so. See id. at 17, 2004 WL 897792. The trial court made these factual findings based on the testimony of the witnesses and other evidence presented to the court. We do not discern clear error in either the trial court's findings, or its conclusion based on those findings that the Calcu-Folios are not, eo nomine, a form of briefcase. 28 Heading 4202 contains a list of particular items followed by a general phrase, similar articles. It is well settled that when a list of items is followed by a general word or phrase, the rule of ejusdem generis is used to determine the scope of the general word or phrase. See Totes, Inc. v. United States, 69 F.3d 495, 498 (Fed.Cir.1995). In classification cases, ejusdem generis requires that, for any imported merchandise to fall within the scope of the general term or phrase, the merchandise must possess the same essential characteristics or purposes that unite the listed exemplars preceding the general term or phrase. Sports Graphics, 24 F.3d at 1392. However, a classification under the ejusdem generis principle is inappropriate when an imported article has a specific and primary purpose that is inconsistent with that of the listed exemplars in a particular heading. Avenues I, 178 F.3d at 1244. 29 We have previously held that the the common characteristic or unifying purpose of the goods in heading 4202 consist[s] of `organizing, storing, protecting, and carrying various items.' Avenues II, 317 F.3d at 1402. The Court of International Trade found the specific and primary purpose of the Calcu-Folios is to facilitate taking of notes as well as to aid the organization of print and other visual flat materials capable of being bound by the article's metal binder or fit within its pockets. CIT Opinion at 19, 2004 WL 897792. Customs does not challenge this finding. It asserts, however, that this specific and primary purpose of the Calcu-Folios cannot preclude ejusdem generis classification of the articles under Heading 4202. 30 In Avenues I, we concurred with the Court of International Trade's conclusion that the physical characteristics of the leather folios speak strongly to the `organizing, storing, protecting, and carrying' characteristics of the imported merchandise. Avenues I, 178 F.3d at 1245. However, the classification of the leather folios in Avenues I was resolved on summary judgment. In contrast, in this case, the trial court reached its conclusions after assessing the credibility of the witnesses. Specifically, finding Shor's testimony credible, the court found that the Calcu-Folios were not designed to accommodate various personal objects. CIT Opinion at 17, 2004 WL 897792. The Court also noted that, in view of the limited storage space of the folio, the article's interior is not sufficiently large or durable enough to hold books, thick newspapers or other personal items for any extended period without damaging itself (or them). Id. 17-18, 2004 WL 897792. While acknowledging that Customs presented evidence to show that the articles could be used to carry personal items, the court found the testimony of the product's designer of its intended use to be more persuasive. Id. at 17, 2004 WL 897792. For the foregoing reasons, we see no basis to conclude that the trial court's findings are clearly erroneous, particularly in view of the deference afforded to its factual findings based on credibility of witnesses. See Anderson v. Bessemer City, 470 U.S. 564, 575, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985) (When findings are based on determinations regarding the credibility of witnesses, Rule 52(a) demands even greater deference to the trial court's findings; for only the trial judge can be aware of the variations in demeanor and tone of voice that bear so heavily on the listener's understanding of and belief in what is said.). 31 Based on these factual findings, the Court of International Trade concluded that [t]he articles '4202' features do not impart the essential characteristics of a '4202' container. CIT Opinion at 19. We agree. Here, while the Calcu-Folios may be used to organize and protect small and/or flat items in addition to a writing pad, they have an internal capacity of only 1 inch and lack significant carrying space. These characteristics make them unsuitable to carry newspapers, books, and other objects that are normally carried in containers that are common to Heading 4202. Moreover, while the articles in question may be generally described as containers, their specific use is limited to facilitation in taking of notes as well as aiding in the organization of print and other visual flat materials. Such a specific use, which predominates over the more general description of containers, precludes classification of the Calcu-Folios under Heading 4202. See Totes, 69 F.3d at 498 (stating that the merchandise in Sports Graphics was not ejusdem generis with the listed exemplars because the imports had a different purpose and the specific use [of the imported merchandise] was predominant over the more general description [of the listed exemplars]). 32 Accordingly, the Court of International Trade correctly concluded that the Calcu-Folios are neither classifiable, eo nomine, as a form of briefcase, nor, under an ejusdem generis analysis, as a similar container, under Heading 4202. 33
34 Regarding classification of the Calcu-Folios under Subheading 4820.10.2020, Customs contends that the Court of International Trade erred in classifying the merchandise as memorandum pads. Specifically, Customs argues that Note 1(h) of Heading 4820 precludes classification under that heading. Customs further argues that the the imported articles are not articles of stationery, of paper or paperboard. Finally, Customs argues that the trial court erred in using the essential character analysis under GRI 3(b), and confused the concepts of primary purpose and essential character. 35 Avenues responds that Note 1(h) is inapplicable because the imported articles have a specific primary purpose that prohibits their classification under Heading 4202. Avenues further responds that, based on the evidence, the court correctly found the Calcu-Folios are articles of stationery pertaining to paper or paperboard. 36 The proper classification of merchandise is governed by the GRIs. See Orlando Food Corp. v. United States, 140 F.3d 1437, 1439 (Fed.Cir.1998). GRI 1 provides that classification is to be determined according to the terms of the headings and any relevant section or chapter notes. Section and chapter notes are not optional interpretive rules, but are statutory law, codified at 19 U.S.C. § 1202. Park B. Smith, 347 F.3d at 927. Note 1(h) to Chapter 48 states that the Chapter does not cover [a]rticles of heading 4202 (for example travel goods). Thus, if the articles are prima facie classifiable under Heading 4202, then applying Note 1(h), the articles are specifically excluded from classification under Heading 4820. See Midwest of Cannon Falls, Inc. v. United States, 122 F.3d 1423, 1429 (Fed.Cir.1997). Conversely, if the articles are not prima facie classifiable under Heading 4202, exclusionary Note 1(h) is inapplicable. Because, for the reasons stated above in section II.a, supra, the Calcu-Folios are not prima facie classifiable under Heading 4202, Note 1(h) does not preclude classification under Heading 4820. 37 Taking into consideration all the physical attributes of the Calcu-Folios and the testimony of the witnesses, the Court of International Trade concluded that they were described properly as an article of stationery, of paper or paperboard. CIT Opinion at 19. The court based its conclusion in part on the presence of the article's structural components, which include a memorandum pad, a three-ring binder, and a paperboard core and spine. The memorandum pad and the core are clearly of paper or paperboard. The court further found that the article's pockets are essentially flat, which limits their storage capabilities to papers and other flat items, and the three-ring binder served to hold three-holed items, such as paper from the memorandum pad. Thus, the court concluded, and we agree, that the Calcu-Folios exhibit characteristics of an article of stationery, of paper or paperboard. Apart from the memorandum pad and the binder, which appear as named exemplars under Heading 4820, most of the remaining features of the Calcu-Folios pertain to use with writing or written documents. For example, the pen sleeves are used to hold pens, and the limited capacity of the cover and the pockets restrict use of the Calcu-Folios to holding or organizing flat items such as papers or folders. 38 Moreover, the Explanatory Notes (ENs) to Heading 4820 state in relevant part that the heading includes: (1) ... memorandum pad... (3) Binders designed for holding loose sheets, magazines, or the like (e.g., clip binders, spring binders, screw binders, ring binders) and folders, file covers, files ... and portfolios. The ENs further provide that these goods may be bound with materials other than paper, such as leather, plastics, or textile materials, and may have reinforcements or fittings of metals. Although the ENs are not legally binding or dispositive, they may be consulted for guidance and are generally indicative of the proper interpretation of the various HTSUS provisions. JVC Co. of Am. v. United States, 234 F.3d 1348, 1352 (Fed.Cir.2000). The examples listed in the EN support the trial court's conclusion that the Calcu-Folio, which contains a memorandum pad, a ring binder designed to hold loose papers, and a cover to protect its contents, falls under Heading 4820. 39 Thus, the imported item as a whole exhibits characteristics of an article of stationery, of paper or paperboard, and shares the common characteristics of a memorandum pad and a letter pad. Accordingly, applying GRI 1, we hold that the Calcu-Folios are classifiable under Subheading 4820.10.2020. 40 Because we conclude that the merchandise at issue is properly classifiable under GRI 1, resort to an analysis under GRI 3(b) is unnecessary. However, since the trial court reached the correct result, mis-steps in its reasoning in arriving there are harmless errors. Pillowtex Corp. v. United States, 171 F.3d 1370, 1376 (Fed.Cir.1999). Accordingly, we need not address Customs' remaining arguments pertaining to the essential character analysis under GRI 3(b).