CAFC Judges Question Whether Frozen Fruit Mixtures Are Food Preparations
Judges at the U.S. Court of Appeals for the Federal Circuit on Dec. 4 questioned importer Nature's Touch Frozen Foods (West) and the government regarding the tariff classification of frozen fruit mixtures. Judge Todd Hughes led the bulk of the questioning, pushing Nature's Touch on how to classify the goods if the court finds that the mixtures aren't food preparations, as claimed by the company, and how they should be classified instead under Harmonized Tariff Schedule heading 0811, which covers certain frozen fruit (Nature's Touch Frozen Foods (West) v. U.S., Fed. Cir. # 23-2093).
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
The suit concerns 14 types of frozen fruit mixtures, five of which contain vegetable ingredients, that the Court of International Trade said are properly classified under HTS subheading 0811.90.80 as "other" frozen fruits, dutiable at 14.5% (see 2305260048). The trade court said heading 0811 is proper because the term "Fruit ... frozen" describes the goods as a whole. Nature's Touch seeks classification under subheading 2016.90.98 as "[f]ood preparations not otherwise specified or included" -- a basket provision that can be used only if no other heading covers the goods more specifically.
Before the appellate court, Nature's Touch said CIT engaged in an interpretation of an "other" provision that is "unprecedented in 245 years of American customs law." John Peterson, counsel for the importer, said the trade court erred in finding that the basket provision for frozen fruits, which wouldn't cover most of the fruits if imported individually, does cover a mixture of the fruit.
To this, Hughes said "unprecedented doesn't necessarily mean wrong," pressing Peterson on the point. The judge noted that CIT's logic "seems to be that fruit has an accepted meaning broad enough to include mixtures of fruit and when we use fruit in common parlance," such as when an individual refers to a "bowl of fruit" or a "cup of fruit." Peterson said the issue is that the lower court "treated the word fruit as an eo nomine provision," when it's a "classification by general description."
Hughes then asked Peterson how the court should classify the goods if the court finds them not to be food preparations but rather belonging under heading 0811. The court's hypothetical had the importer's counsel choose between the "other: other" provision under the heading or using the General Rule of Interpretation No. 3, which says that mixtures of goods shall be classified "as if they consisted of the material or component which gives them their essential character."
The judge suggested that the more easily applicable rule would be to use the "other: other" provision as opposed to using GRI 3, which seems "much more subject to manipulation than just using the 'other: other' category." To this, Peterson said there's "no indication that the drafters ever indicated the 'other: other' category to be used for mixtures."
Arguing for the U.S., Brandon Kennedy said CIT "got it correct" because CBP always tries to classify using GRI 1 when possible. To this argument, Hughes said that the "case doesn’t fit very comfortably in anything, but it seems a little bit strange," since the "other" provision lists only other single frozen fruits, though when it discusses mixes, it lists specific mixes. "That doesn't naturally read as mixed fruit," the judge said. "It reads as other unidentified single fruit, which is what Customs originally found."
Kennedy said that under the plain meaning of 0811, the term "fruit encompasses mixed fruit," concluding the analysis under GRI 1. Establishing that the heading includes mixed fruit, "all the subheadings have to because we can't narrow or expand the meaning," he added. Hughes asked that if that analysis, if adopted, means the court is saying that "wherever 'other' is used across the HTS, it always means none of the above." The judge said that "other" just means "things not identified above."
"I will be concerned that if we said 'other' means none of the above, that it might play out differently in another context," the judge said.
Kennedy then said the mixtures aren't food preparations for various reasons, one of which is the product's ultimate use as a food preparation. The product has a "wide variety of uses, and it's not a specific use," so it doesn't meet the definition of specific use, he said.