Application for Further Review of Protest No. 2704-18-101681; Tariff classification of LC Stackers

HQ H304788 August 23, 2020 OT:RR:CTF:CPMM H304788 RRB CATEGORY: Classification TARIFF NO.: 4202.92.9700; 4420.90.8000 Center Director Consumer Products & Mass Merchandising Center of Excellence and Expertise U.S. Customs and Border Protection 157 Tradeport Drive Atlanta, GA 30354 Attn: Maureen Casey, Supervisory Import Specialist Ann Purdy, Import Specialist RE: Application for Further Review of Protest No. 2704-18-101681; Tariff classification of LC Stackers Dear Port Director: The following is our decision regarding the Application for Further Review (“AFR”) of Protest Number 2704-18-101681, timely filed on October 23, 2018, by DJS International Services, Inc. on behalf of The Container Store (“Protestant”). The AFR concerns U.S. Customs and Border Protection’s (“CBP”) classification, under the Harmonized Tariff Schedule of the United States (“HTSUS”), of merchandise identified as “LC Stackers.” No samples were provided but our office did receive a Microsoft Excel spreadsheet with photographs and descriptions. FACTS: The protested merchandise consists of 39 models of assorted jewelry boxes, sunglass boxes, and unlidded boxes or trays in varying sizes and internal configurations, generally referred to as “LC Stackers.” The base of each item is constructed of medium-density fiberboard (“MDF”) with a textile-lined interior. According to the Protestant’s website, all of the merchandise consists of a “cruelty-free vegan leather exterior.” Upon examination by CBP, we confirmed that the “cruelty-free vegan leather” material is a polyurethane sheeting. The 39 models at issue are described as follows: 1) nine (9) of the models are lidded and specially fitted with specific slots or mountings to hold and display rings, earrings or watches; 2) three (3) of the models are lidded and specially fitted with an internal divider for storing and organizing sunglasses; 3) 20 of the models are unlidded valet trays with various types of compartments; and 4) seven (7) of the models are deep, open boxes with no compartments and no lid. The protested entries of LC Stackers were entered on September 21, 2017, and August 18, 2017, at the Port of Los Angeles (“Port”), and were liquidated on June 8, 2018, and July 6, 2018, respectively, under subheading 4420.90.80, HTSUS (2017), as “[w]ood marquetry and inlaid wood; caskets and cases for jewelry or cutlery and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling within chapter 94: Other: Other…” at a duty rate of 3.2% ad valorem. Protestant filed this Protest and AFR on October 23, 2018, asserting that the subject merchandise is properly classified under subheading 4420.90.65, HTSUS (2017), as “[w]ood marquetry and inlaid wood; caskets and cases for jewelry or cutlery and similar articles, of wood; wooden articles of furniture not falling within chapter 94: Other: Jewelry boxes, silverware chests, cigar and cigarette boxes, microscope cases, tool or utensil cases and similar boxes, cases and chests, all the foregoing of wood: Other: Lined with textile fabrics…” at a duty rate of free. ISSUE: Whether assorted jewelry boxes, sunglass boxes, and unlidded boxes or trays in varying sizes and internal configurations, generally referred to as “LC Stackers” are classified under subheading 4202.92.9700, HTSUSA (2017), as “. . .jewelry boxes. . . and similar containers . . .of sheeting of plastics. . . : Other: With outer surface of sheeting of plastics or of textile materials: Other: Other: Other: Other…” under subheading 4420.90.6500, HTSUSA (2017), as “…caskets and cases for jewelry or cutlery and similar articles, of wood. . . : Other: Jewelry boxes, silverware chests, cigar and cigarette boxes, microscope cases, tool or utensil cases and similar boxes, cases and chests, all the foregoing of wood: Other: Lined with textile fabrics…”; or under subheading 4420.90.8000, HTSUSA (2017), as “…caskets and cases for jewelry or cutlery and similar articles, of wood. . . : Other: Other.” LAW AND ANALYSIS: The protest was properly filed as a decision on classification under 19 U.S.C. § 1514(a)(2). The protest was timely filed within 180 days of liquidation of the entries. See 19 U.S.C. § 1514(c)(3). Further Review of Protest Number 2704-18-101681 was properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(a) because the decision against which the protest was filed “[i]s alleged to be inconsistent with a ruling of the Commissioner of Customs or his designee, or with a decision made any port with respect to the same or substantially similar merchandise.” Protestant cites to New York Ruling Letter (“NY”) N019525, dated December 3, 2007, in which CBP classified a lidded storage box constructed of MDF and covered with rayon fabric laminated to a paperboard backing in subheading 4420.90.65, HTSUS, as “caskets and cases for jewelry…of wood;…Other: Jewelry boxes, silverware chests, cigar and cigarette boxes, microscope cases, tool or utensil cases and similar boxes, cases and chests, all the foregoing of wood: Lined with textile fabrics.” Protestant alleges that the subject LC Stackers should be similarly classified in subheading 4420.90.65, HTSUS. Classification under the HTSUS is made in accordance with the General Rules of Interpretation (“GRI”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order. GRI 6 provides that for legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section and chapter notes also apply, unless the context otherwise requires. The 2017 HTSUS provisions under consideration are as follows: 4202 Trunks, suitcases, vanity cases, attache cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar containers; traveling bags, insulated food or beverage bags, toiletry bags, knapsacks and backpacks, handbags, shopping bags, wallets, purses, map cases, cigarette cases, tobacco pouches, tool bags, sports bags, bottle cases, jewelry boxes, powder cases, cutlery cases and similar containers, of leather or of composition leather, of sheeting of plastics, of textile materials, of vulcanized fiber or of paperboard, or wholly or mainly covered with such materials or with paper: Other: 4202.92 With outer surface of sheeting of plastics or of textile materials: Other: Other: Other: 4202.92.97 Other. . . 4420 Wood marquetry and inlaid wood; caskets and cases for jewelry or cutlery and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling within chapter 94: 4420.90 Other: Jewelry boxes, silverware chests, cigar and cigarette boxes, microscope cases, tool or utensil cases and similar boxes, cases and chests, all the foregoing of wood: Other: 4420.90.65 Lined with textile fabrics. . . 4430.90.80 Other. . . * * * Note 1(e) to chapter 44 provides as follows: This chapter does not cover: *** (e) Articles of heading 4202; * * * The Explanatory Notes (“ENs”) to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings at the international level. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). The EN to 42.02 states, in pertinent part: The articles covered by the second part of the heading must, however, be only of the materials specified therein or must be wholly or mainly covered with such materials or with paper (the foundation may be of wood, metal, etc.). The term “leather” includes leathers (including combination chamois) leather, patent leather, patent laminated leather and metallised leather (see Note 1 to this Chapter). The expression “similar containers” in this second part includes notecases, writingcase, pencases, ticketcases, needlecases, keycases, cigarcases, pipecases, tool and jewellery rolls, shoecases, brushcases, etc. *** The term “jewellery boxes” covers not only boxes specially designed for keeping jewellery, but also similar lidded containers of various dimensions (with or without hinges or fasteners) specially shaped or fitted to contain one or more pieces of jewellery and normally lined with textile material, of the type in which articles of jewellery are presented and sold and which are suitable for longterm use. The EN to 44.20 states, in pertinent part: The articles of this heading may be made of ordinary wood or of particle board or similar board, fibreboard, laminated wood or densified wood (see Note 3 to this Chapter).   It also covers a wide variety of articles of wood (including those of wood marquetry or inlaid wood), generally of careful manufacture and good finish, such as: small articles of cabinetwork (for example, caskets and jewel cases); small furnishing goods; decorative articles. Such articles are classified in this heading, even if fitted with mirrors, provided they remain essentially articles of the kind described in the heading. Similarly, the heading includes articles wholly or partly lined with natural or composition leather, paperboard, plastics, textile fabrics, etc., provided they are articles essentially of wood.   The heading includes:   Boxes of lacquered wood (of the Chinese or Japanese type); cases and boxes of wood, for knives, cutlery, scientific apparatus, etc; snuffboxes and other small boxes to be carried in the pocket, in the handbag or on the person; stationery cases, etc.; needlework boxes; tobacco jars and sweetmeat boxes. However, the heading excludes ordinary kitchen spiceboxes, etc. (heading 44.19). Articles of wooden furniture, other than those of Chapter 94 (see the General Explanatory Note to that Chapter. This heading therefore covers such goods as coat or hat racks, clothes brush hangers, letter trays for office use, ashtrays, pen-trays and ink stands.   * * * * The initial issue is whether all of the LC Stackers are classified in heading 4420, HTSUS, or whether some of the merchandise are classified in heading 4202, HTSUS, as “jewelry boxes, . . .of sheeting of plastics.” Classification of the subject merchandise within heading 4420, HTSUS, is subject to note 1(e) to chapter 44, which excludes from chapter 44, goods that are classifiable in heading 4202, HTSUS. Therefore, prior to considering classification of the subject merchandise in heading 4420, HTSUS, we must first determine whether they are classifiable in heading 4202, HTSUS. Heading 4202, HTSUS, sets forth two lists of merchandise which are classifiable under that heading. The lists are separated by a semicolon. Articles listed before the semicolon are not restricted as to material type, and articles listed after the semicolon must be composed of leather or composition leather, sheeting of plastics, textile materials, vulcanized fiber, or paperboard, or wholly or mainly covered with such materials or with paper. Both parts provide for the classification of certain named articles and “similar containers.” In addition, the EN to 42.02 states that “the term ‘jewellery boxes’ covers not only boxes specially designed for keeping jewellery, but also similar lidded containers of various dimensions (with or without hinges or fasteners) specially shaped or fitted to contain one or more pieces of jewellery and normally lined with textile material.” Thus, the LC Stackers at issue are classifiable in this heading if they are ejusdem generis with the enumerated containers. See Sports Graphics, Inc. v. United States, 24 F.3d 1390, 1392 (Fed. Cir. 1994). In Totes, Inc. v. United States (“Totes I”), 18 C.I.T. 919, 924 (1994), the Court of International Trade (“CIT”) held that the essential characteristics which unite the containers of heading 4202, HTSUS, are that the containers “organize, store, protect and carry various items.” Id. aff’d by Totes, Inc. v. United States (“Totes II”), 69 F.3d 495 (Fed. Cir. 1995). We also note that the courts have applied these four unifying characteristics to containers listed both before and after the semicolon. See, e.g., Avenues in Leather, Inc. v. United States, 11 F.Supp. 2d 719, 723 – 724 (CIT 1998) (applied the four characteristics to a leather folio case classified before the semicolon in subheading 4202.11.00, HTSUS); Totes II, 69 F.3d at 500 (applied the four characteristics to a trunk organizer classified after the semicolon in subheading 4202.92.90, HTSUS). Turning to the protested merchandise, we must apply the principle of ejusdem generis to determine if the LC Stackers at issue have the same essential characteristics as the named containers of heading 4202, HTSUS. Lidded containers that are specially fitted with specific slots or mountings to hold and display rings, earrings or watches The first group of LC Stackers under examination consists of nine models of lidded containers that are internally fitted with specific, textile-lined slots or mountings to hold and display rings, earrings, or watches, and that have hinges and a secure closure mechanism for organizing, storing, protecting and carrying its contents. They are similar to the types of cases in which jewelry is presented and they are all suitable for long term use given the durable MDF base and lid and metal hinges. Accordingly, these items share the same essential characteristics of organizing, storing, protecting and carrying various pieces of jewelry or watches and are ejusdem generis with jewelry boxes enumerated after the semicolon in heading 4202, HTSUS. Because jewelry boxes are enumerated after the semicolon, jewelry boxes and similar containers must be made of leather, plastic sheeting, textile materials, vulcanized fiber, paperboard, or wholly or mainly covered with such materials or with paper in order to be classified in heading 4202, HTSUS. Here, the nine lidded LC Stackers that are specially fitted with specific slots or mountings to hold and display rings, earrings or watches are covered in a sheeting of polyurethane plastic. Accordingly, these models of LC Stackers, which meet the compositional requirements for items identified after the semicolon and which have the essential characteristics of jewelry boxes of heading 4202, HTSUS, are ejusdem generis with jewelry boxes and are properly classified in heading 4202, HTSUS. Thus, pursuant to note 1(e) to chapter 44, they are excluded from classification in heading 4420, HTSUS, because they are articles of heading 4202, HTSUS. Therefore, the nine models of LC Stackers consisting of lidded containers that are internally fitted with specific textile-lined slots or mountings to hold and display rings, earrings, or watches, and which are covered in a polyurethane sheeting of plastic, are classified in subheading 4202.92.97, HTSUS(2017), which provides for “jewelry boxes. . . and similar containers. . . of sheeting of plastics. . . : Other: With outer surface of sheeting of plastic or of textile materials: Other: Other: Other: Other.” CBP has classified similar jewelry boxes under heading 4202, HTSUS. See, e.g., HQ 287056, dated February 25, 2020; NY N138376, dated January 7, 2011; NY N134837, dated December 20, 2010; and NY N132063, dated December 3, 2010. Without further explanation into its reasoning, the Protestant argues that all of the LC Stackers should be classified in heading 4420, HTSUS, and specifically in subheading 4420.90.65, HTSUS, based on NY N019525, dated December 3, 2007. In NY N019525, we classified a square storage box with a lid, which was constructed of MDF and covered with rayon fabric laminated to a paperboard backing, in subheading 4420.90.65, HTSUS, which provides for: “Jewelry boxes, silverware chests, cigar and cigarette boxes, microscope cases, tool or utensil cases and similar boxes, cases and chests, all the foregoing of wood: Other: Lined with textile fabrics.” However, this merchandise was classified as a jewelry box of heading 4420, rather than heading 4202, because it was covered with rayon fabric laminated to a paperboard backing, and therefore, did not meet the compositional requirements of items after the semicolon in heading 4202, HTSUS. Unlike the items in NY N019525, all of the lidded LC Stackers are covered in a sheeting of plastic, and thus, meet the compositional requirements of heading 4202, HTSUS. Therefore, NY N019525 is irrelevant to the classification of the lidded LC Stacker models, which are classified in subheading 4202.92.9700, HTSUSA (2017). Lidded containers that are specially fitted with an internal divider for storing and organizing sunglasses Also at issue are three models of lidded containers that are specially fitted with an internal divider for storing and organizing sunglasses. Like the lidded LC Stackers that hold and display rings, earrings, and watches, these LC Stackers are also manufactured from MDF, covered in a polyurethane sheeting of plastic, have a textile fiber interior lining and have metal hinges and a secure closing mechanism for organizing, protecting and carrying its contents, as well as being suitable for long term use. The internal divider runs through the middle of the base of the storage box, with the nose bridge of each pair of sunglasses resting on top of the divider, thereby securing the sunglasses in place for greater organization. Accordingly, these items are also ejusdem generis with jewelry boxes enumerated after the semicolon in heading 4202, HTSUS. We note that although these items are not compartmentalized to the same degree as the lidded containers that are specially fitted with specific slots or mountings to hold and display rings, earrings or watches, this is not required for merchandise that is a “similar container” and ejusdem generis with jewelry boxes of heading 4202. In HQ H209830, dated August 13, 2014, we explained that the reference in the EN to 42.02 that jewelry boxes and similar lidded containers are “specially shaped or fitted” does not encompass the phrase “similar containers” as it appears alongside jewelry boxes in heading 4202. In particular, we stated the following: Thus, the phrase “similar lidded containers” refers to a class of “jewelry boxes.” And the term “similar containers” as used in heading 4202 refers to containers which are not jewelry boxes at all; they are merely similar enough that they ejusdem generis are classified alongside jewelry boxes. There are no limitations, such as the requirement of a specially fitted compartment, on goods that are similar to jewelry boxes. Even if the lidded containers fitted with an internal divider to store and organize sunglasses are not considered specially fitted, this is not dispositive to their classification in heading 4202 since these are “similar containers” that are ejusdem generis with jewelry boxes. Thus, pursuant to note 1(d) to chapter 44, because the merchandise is classifiable in heading 4202, HTSUS, it is excluded from classification in heading 4420, HTSUS. Unlidded valet trays with various types of compartments Turning to the unlidded LC