Sprinkler Importer Says CBP Wrongly Reversed Long-Standing Practice Without Notice
Sprinkler importer Melnor brought a complaint against the government Feb. 28 contesting CBP’s revocation of a long-standing practice of classifying its sprinklers under Harmonized Tariff Schedule heading 9817 (Melnor, Inc. v. United States, CIT # 25-00052).
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Describing itself as “a brand beloved by lawn and garden enthusiasts” that has “over 155 patents for lawn and garden watering implements,” the importer said it has imported more than a thousand entries of sprinklers over the past six years, all of which CBP liquidated as duty-free under heading 9817 for “[m]achinery, equipment and implements to be used for agricultural or horticultural purposes.”)
In particular, it noted that the agency usually lets “importers of retail goods to establish actual use through ‘[a] certification by the importer which states that the article(s) may only be used for the agricultural or horticultural use for which they are intended.’”
But CBP suddenly changed course in regard to a recent entry, telling Melnor one of its oscillating sprinkler models was multifunctional and couldn’t be classified under heading 9817. This also applied to Melnor’s future entries, the agency said.
Melor argued that CBP’s statement was “an interpretative ruling or decision revoking CBP’s prior interpretive rulings and decisions” because it was “explicitly” prospective and “was the result of considered deliberations.” But interpretive rulings must be published in the Customs Bulletin and offer to solicit comments, Melnor said. CBP’s failure to do these things meant its ruling didn’t apply, it said.
The importer also argued CBP was treating similarly situated products differently, “as is indicated by the nearly forty years of rulings determining that sprinklers and other lawn and garden watering implements are classifiable under HTSUS subheading 9817.00.50.”
And those 40 years of rulings, which show a "regular review, scrutiny, and deliberation of Melnor’s products” that went “well beyond passive review,” were such strong precedent that CBP was required to notify Melnor in advance of importation that it intended to abandon its usual practice, it said -- not assess retrospective duties Melnor couldn’t reasonably have anticipated.
The importer also argued that its sprinklers did still meet the requirements of heading 9817.