Importer Mitsubishi Says US Misrepresenting Several Court Holdings in Reply
Responding to U.S. opposition to its summary judgment motion, importer Mitsubishi Power Americas said Jan. 17 that the government “proffered nothing to dispute” expert testimony that shows its products are neither filters nor purifiers and misunderstood the way they actually work (Mitsubishi Power Americas v. U.S., CIT #21-00573).
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The U.S. claim otherwise “is fundamentally incorrect … and is refuted based on dictionary definitions, case law adopted by this Court, and expert testimony of Dr. Scott Hinton, who holds a B.S. in Chemical Engineering and a Ph.D. in Heterogeneous Catalysis,’” it said.
The importer brought its case to the Court of International Trade alleging its (selective catalytic reduction) SCR catalyst blocks should have been classified under Harmonized Tariff Schedule heading 3815 as “reaction initiators, reaction accelerators and catalytic preparations, not elsewhere specified or included,” not heading 8421 as “centrifuges, including centrifugal dryers; filtering or purifying machinery and apparatus, for liquids or gases” (see 2412190071). Heading 8421 is covered by 25% Section 301 tariffs.
In a cross-motion for summary judgment and response to Mitusbishi’s own motion for judgment, the U.S. argued that the catalyst blocks “filter or purify flue gas, just like a catalytic converter filters or purifies a car’s exhaust.”
First, the importer said that the U.S. “appears to concede” that the blocks don’t filter gases because it instead focused primarily on the definition and application of the term “purify.”
It also said the products don’t purify because they don’t “‘remove’ or ‘eliminate’” the bad elements of a substance, Mitsubishi argued in its Jan 17 brief. Rather, they “simply convert nitrogen oxides into nitrogen and water vapor to prepare the flue gas for further processing and filtration with the Air Quality Control System.”
“[T]he major fallacy in Defendant’s argument is that ‘conversion’ does not constitute ‘removal’ or ‘elimination,’” it said.
Its “unrefuted” export report demonstrates this, it said, as its export explained that “no mass is gained or lost as part of the” catalytic conversion process.
It called the U.S.’s argument an “impermissibly broad reading and mischaracterization” of the court’s holding in Franklin, which “discussed actual removal (i.e., killing of bacteria and eliminating chlorine)” rather than a simple “chemical reaction that converts something unwanted into something innocuous.”
Mitsubishi also called “flabbergasting” the government’s citation to the U.S. Court of Appeals for the Federal Circuit Case Home Depot U.S.A., which stated “that GRI 1 applies, and the succeeding GRIs are inoperative, when an article is covered in whole by a single classification heading, and that GRI 3 only applies when goods are prima facie classifiable under two or more headings.”
This language did appear in CAFC’s opinion, the importer said, but only to explain CIT’s holding before the CAFC explicitly disagreed and remanded it.
“In summary, the Federal Circuit rejected the specific concept that Defendant is advocating here in the very case that Defendant cited in its brief,” Mitsibushi said, writing in both bold and italics.
It also cited several CBP rulings in which the agency “consistently” preferred to classify goods under basket provisions over provisions for “‘parts’ of articles.” And it again pointed out that the Mitsubishi’s SCR blocks were those for which the Office of the U.S. Trade Representative specifically created the Section 301 tariff exemption in question.
And the importer also argued blocks aren’t “apparatus.” The U.S. looked to CIT’s Trijicon holding to define apparatus as “equipment designed to specifically carry out a particular function.” But it “appear[ed] to misreport” the holding, which actually described apparatus as “a set of materials or equipment designed for a particular use,” Mitsubishi said. The government also ignored Trijicon’s second definition, “any complex device or machine for a specific use,” it claimed.
It said that its products didn’t meet the first definition. Trijicon, it said, went on to explain that “equipment” requires “each individual component … must also serve a particular function.” But parts of the blocks such as their frames, seal bars and plates and spacers don’t serve a particular function, it said. And it disagreed that it ever had conceded that its products were apparatus.
The U.S. had also waived the argument that Mitsubishi’s products were “machinery," it said.