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HQ 966952




August 18, 2004

CLA-2 RR:CR:GC 966952 KBR

CATEGORY: CLASSIFICATION

TARIFF NO.: 9405.40.8000

Ms. Brenda A. Jacobs
Sidley Austin Brown & Wood LLP
1501 K Street, N.W.
Washington, D.C. 20005

RE: NY G81588 Affirmed; Litecubes™

Dear Ms. Jacobs:

This is in reference to your letter dated January 24, 2004, on behalf of Litecubes LLC and Light FX, Inc., in which you requested reconsideration of New York Ruling Letter (NY) G81588, dated September 18, 2000, issued to you by the Customs National Commodity Specialist Division, New York, concerning the classification, under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), of “Litecubes™”, freezable lights. Samples of the products were submitted. Consideration was also given to additional materials received dated March 11, 2004, and July 23, 2004, as well as information discussed in a teleconference held on July 19, 2004.

FACTS:

The Litecubes™ in NY G81588 were clear plastic cubes in the size and shape of an ice cube. The Litecubes™ measured approximately 1 3/8 inches by 1 ¼ inches by 1 ¼ inches. The Litecubes™ contain a refrigerant that is hermetically sealed within its body. The cube also contains a cartridge that houses a light emitting diode (“LED”) and a button-cell battery attached to one side of the cube. The cube features a lid affixed on top of the lighting mechanism with an interior label with instructions for operating the light feature. After being frozen, the cubes are intended to be used in drinks, punchbowls and centerpieces during parties, weddings and other celebrations.

In your initial submission dated January 22, 2004, you state that the Litecubes™ are also in other designs, such as a lemon wedge and dice. Your letter also described various types of packaging used for the original cube-style Litecubes™. Samples of the different packaging were submitted. One package contains four cubes that will light in four different colors which you state will “promote a party theme.” One package contains four cubes, two of which will light up in red and two in green. The package has a picture of Santa Claus and holly leaves on it, and the letters “lite” are colored in a red and white diagonally striped candy cane pattern. One package contain three cubes, one which will light red, one blue and one white. This package is offered for sale around the 4th of July. The packaging has a picture of the American flag on it.

The description on the packages include:

Amazing freezable lights for drinks, parties, and more; The Ultimate Party Light; The Perfect Party Favor; The Ultimate Ice Breaker; For the Kid in All of Us; Frozen or not, LITECUBES™ set the perfect mood; in cool drinks or soda pops; at Barbeques; in cocktails; in punch bowls; on party platters; travelling night-lights; in flower vases; in bathtubs; in hot tubs and pools; along walkways; on camp-outs; anywhere your imagination takes them; start a romantic evening with LITECUBES™; Their fresh, passionate glow outshines candles; provide drama and elegance with the unique glow from LITECUBES™; Light up your life with creative flare and creative sparkle; get people talking; Kids love LITECUBES™.

The back of the packaging has four pictures: one of a couple in a romantic setting holding drinks containing the Litecubes™; one of four smiling people holding margarita-style glasses containing Litecubes™; one of several styles of glass holding Litecubes™; and one of two children with studious faces in water holding Litecubes™. The website for Litecubes™ states that they “contain a gel that allows it to be frozen to help keep beverages cold.” Further, the website states that:

The uses for Litecubes range from lighting drinks at tailgate parties to illuminating punch bowls at receptions or even providing a unique effect in tubs and pools. Additionally, Litecubes can simply be placed around a room to create a wacky or surprisingly romantic atmosphere.

The instructions for use on the packaging state:

Hand wash with hot, soapy water before using. Not dishwasher safe. Freeze if desired. When used intermittently, Litecubes provides more than a dozen hours of fun. For maximum drink-cooling power, use Litecubes with real ice. Disposable novelty item.

In your facsimile, dated March 11, 2004, you stated that the Litecubes™ are generally sold in small gift stores (“Mom & Pops”) and select party stores. You state that some “private label” production has been made for particular organizations. The website for Litecubes™ lists particular means by which they can be purchased, such as at home goods stores and kitchen supply stores as well as on the internet and television marketing.

In your letter dated July 23, 2004, you state that the majority of Litecubes™ sales are non-retail, to the “Special Events” market. You specifically state that you are not asserting that these articles are practical joke items. You state that the sale of the Litecubes™ spikes during holiday periods with more sales in colors somewhat associated with that holiday: red and white at Valentine’s Day; Green at St. Patrick’s Day; blue and white at Chanukah; red and green at Christmas. You also state that the Litecubes™ are “regularly used as decorations and party favors for both major holidays and for other festivities related to those holiday seasons, such as office holiday parties, as well as other special events, they may be used for other parties as well.”

ISSUE:

Whether the Litecube™ is properly classified as a toy, as a festive article, or as an electrical lamp?

LAW AND ANALYSIS:

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the HTSUS is such that virtually all goods are classified by application of GRI 1, that is, 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 may then be applied.

In interpreting the headings and subheadings, the Bureau of Customs and Border Protection (“CBP”) looks to the Harmonized Commodity Description and Coding System Explanatory Notes (ENs). Although not legally binding, they provide a commentary on the scope of each heading of the HTSUS. It is CBP practice to follow, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).

The HTSUS provisions under consideration are as follows:

9405 Lamps and lighting fittings including searchlights and spotlights and parts thereof, not elsewhere specified or included; illuminated signs, illuminated nameplates and the like, having a permanently fixed light source, and parts thereof not elsewhere specified or included:

9405.40 Other electric lamps and lighting fittings:

9405.40.8000 Other

9503 Other toys; reduced-size (“scale”) models and similar recreational models, working or not; puzzles of all kinds; parts and accessories thereof:

9503.90.00 Other

9505 Festive, carnival or other entertainment articles, including magic tricks and practical joke articles; parts and accessories thereof:

9505.90 Other:

9505.90.6000 Other

Chapter 95, HTSUS, covers toys of all kinds, whether designed for the amusement of children or adults. Although the term “toy” is not specifically defined in the tariff, the ENs to Chapter 95, indicate that this chapter covers toys of all kinds whether designed for the amusement of children or adults.

In HQ 960136 (July 24, 1997), CBP cited United States v. Topps Chewing Gum, Inc., 58 CCPA 157, C.A.D. 1022 (1971), to give the following definition of a toy:
it was held that articles which may lack the material features to be a manipulative plaything as such, but because of their cartoon-like, comical appearance, or scary look, would likely be used as an interesting or novelty decorative object, are considered primarily used for amusement purposes or as a source of frivolous entertainment for children or adults. In other words, if the article’s appearance generates the same type of emotional reaction one derives from playing with objects commonly recognized as toys, the article’s principal use is to amuse. Therefore, the article is capable of being classifiable as a toy.

The primary purpose of the item must be its amusement value to be classified as a toy. In Ideal Toy Corp. v United States, 78 Cust. Ct. 28 (1977), the court stated that "when amusement and utility become locked in controversy, the question becomes one of determining whether amusement is incidental to the utilitarian purpose, or whether the utility purpose is incidental to the amusement." In HQ 085267 (May 9, 1990), involving a drawing kit to be used on a jacket which was included, CBP found that “[a]lthough they may tend to amuse those who use them, such amusement is incidental to their primary purpose.” In HQ 961123 (December 18, 1998), CBP stated that:

It has been Customs position that the amusement requirement means that toys should be designed and used principally for amusement. They should be more than accessories which entertain but have little or no manipulative play value.

In HQ 961912 (October 28, 1998), CBP looked not only at how the article was designed and used in determining that it was a toy, but also at the way it was sold and marketed stating:

The physical characteristics of “Elmo’s 1-2-3 Sprinkler,” mainly its bright colors, “Sesame Street” motif and manipulation of water, appeal to a sense of fun and play with water. The ultimate purchaser expects to use this article as a water toy for children. It is traded in toy channels by a toy company. Its manner of advertisement and display all highlight its amusing qualities. All these characteristics indicate that [it] is designed principally to amuse.

In the instant case, the Litecubes™ do not meet the above standards for toys under heading 9503, HTSUSA. The information provided shows that the Litecubes™ are not sold in stores traditionally thought to sell toys. The packaging and website clearly accentuate multiple uses of the Litecubes™ other than as toys including: the functionality of keeping drinks cold, “tailgating parties,” “illuminating punch bowls at receptions,” “providing a unique effect in tubs and pools,” “create a surprisingly romantic atmosphere,” “night-lights,” and “match a color to your favorite sports team.” These multiple uses are not “toys”. In your letter of July 23, 2004, you assert that you primarily market the articles as theme setting articles for parties. We find that at best the Litecubes™ are, as you state, a “conversation piece” or “decoration”, but not something that elicits the same type of “emotional reaction” for “fun and play” as a traditional toy, such as a yo-yo. The Litecube™ may invoke a “hmm, that is interesting” response akin to artwork or decoration, but does not provide any “play value”. The article also does not have a “cartoon-like, comical appearance, or scary look” as discussed in the Topps Chewing Gum case.

You also cite HQ 956562 (August 31, 1994), concerning a bubble necklace where CBP ruled that the necklaces were toys even though they had a utilitarian function as a necklace. However, in that case the child would wear the necklace and blow bubbles from the pendent hanging on the chain. Blowing bubbles has long been a traditional amusement for children and elicits the emotional response required for bubble blowers to be considered a toy under the HTSUSA. Therefore, since the Litecubes™ do not elicit the emotional response necessary and are marketed in such a way that multiple, non-toy uses (keeping drinks cold, illuminating punch bowls, night-lights, create a romantic atmosphere, etc.), are prevalent, we find that the Litecubes™ are not classifiable as toys under heading 9503, HTSUSA.

In the alternative you claim that the Litecubes™ should be classified as a “festive article” under heading 9505, HTSUSA. In Midwest of Cannon Falls, Inc. v. United States, 20 C.I.T. 123 (Ct. Int’l Trade, 1996), aff’d in part, rev’d in part, 122 F.3d 1423 (Fed. Cir. 1997) (hereinafter Midwest), the Court addressed the scope of heading 9505, HTSUSA, specifically the class or kind of merchandise termed “festive articles,” and provided new guidelines for classification of such goods in the heading. In general, merchandise is classifiable as a festive article in heading 9505, HTSUSA when the article, as a whole:

1. Is not predominately of precious or semiprecious stones, precious metal or metal clad with precious metal;

2. Functions primarily as a decoration or functional item used in celebration of, and for entertainment on, a holiday; and

3. Is associated with or used on a particular holiday.

Based upon a review of the articles subject to the Midwest decision, CBP is of the opinion that the Court has included within the scope of the class “festive articles,” decorative household articles which are representations of an accepted symbol for a recognized holiday, and utilitarian/functional articles that are three-dimensional representations of an accepted symbol for a recognized holiday. The CAFC in the Midwest decision, in discussing the functional and utilitarian items, stated: "Nothing from the pertinent subheading 9505.90.60 - ‘other festive, carnival or other entertainment articles’ - limits 9505.90.60 to only ‘non-utilitarian’ items." However, the ENs have been amended by adding language excluding articles which are functional from heading 9505, HTSUSA:

The heading also excludes articles that contain a festive design, decoration, emblem or motif and have a utilitarian function, e.g., tableware, kitchenware, toilet articles, carpets and other floor coverings, apparel, bed linen, toilet linen, kitchen linen.

In addition to the criteria listed above, the Court in Midwest considered the general criteria for classification set forth in United States v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F.2d 373 (1976), cert. denied, 429 U.S. 979 (hereinafter Carborundum). Therefore, with respect to decorative and utilitarian articles related to holidays and symbols not specifically recognized in Midwest, CBP will also consider the general criteria set forth in Carborundum to determine whether a particular good belongs to the class or kind “festive articles.” Those criteria include the general physical characteristics of the article, the expectation of the ultimate purchaser, the channels of trade, the environment of sale (accompanying accessories, manner of advertisement and display), the use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use.

The Litecubes™ do not meet the three Midwest criteria. Although they are not predominately of precious or semiprecious stones, precious metal or metal clad with precious metal; and there are multiple functional purposes; the Litecubes™ are not closely associated with a particular holiday. Further, the Litecubes™ use outside of any holiday would not be aberrant as is obvious from their marketing. Only two of the various marketing packs are at all even arguably holiday related. One of the packs contains only red and green Litecubes™; the packaging has the letters “lite” printed in a red and white diagonal stripe; there are some holly leaves pictured; and there is the face of a white bearded and mustached man with glasses and white hair across his forehead, in the upper right corner. This is ostensibly an article for the Christmas holiday, although nowhere does it use the word “Christmas”. The other package contains red, white and blue Litecubes™, and the packaging has the picture of an American flag on it. However, both of these packages have the printing on the back listing the multiple events, ways and types of places the Litecubes™ may be used which was discussed above. Further, we note that each of the cubes may be used individually. Therefore, use of the Litecubes™ outside of the particular holiday would not be aberrant.

An application of the Carborundum criteria yields the following results:

(a) The general physical characteristics of the merchandise. The article itself, particularly when each Litecube™ is taken individually does not portray any recognized holiday symbol, shape or design.

(b) The expectation of the ultimate purchaser. The Litecubes™ are marketed for varied uses, most notably for the functionality of keeping drinks cold. The multiple uses discussed above not only provide a “utility”, but are not associated with a “festive occasion”. Therefore, the Litecubes™ may be used at any time of the year for these multiple purposes and the user would not be constrained to only use the Litecubes™ at one particular holiday.

(c) The channels of trade. The Litecube™ is not sold only at particular holiday times at stores which sell only holiday supplies.

(d) The environment of sale (accompanying accessories, manner of advertisement and display). The Litecubes™ are marketed for multiple uses throughout the year, as discussed above, which have nothing to do with a particular holiday.

(e) Use in the same manner as merchandise which defines the class. The Litecubes™ have multiple uses and the “cube” design is totally unrelated to any uses associated with a particular holiday.

(f) The economic practicality of so using the import. The Litecubes™ may be used at any time of the year not just at a particular holiday period.

(g) Recognition in the trade of this use. The Litecubes™ are advertised, marketed and sold for multiple uses at all times of the year, not restricted to a particular holiday period.

In HQ 962801 (June 23, 2000), CBP found that Halloween votive candleholders were festive articles because the function of the light was to illuminate the decorative article, not to provide light to a room. However, in the instant case, the Litecubes™ are not intended to be used to light up a decoration specifically designed for a particular holiday. HQ 961042 (May 4, 1999), required the festive article to be associated with one particular holiday. You cite HQ 954431 (July 21, 1993), which stated that the article involved (“table bombs”) did “not meet the criteria for festive articles because they are not traditionally associated with a particular festival, but instead may be used at parties and various celebrations throughout the year.” Such is also the case with the instant Litecubes™. Although HQ 954431 found the table bombs to be classified in 9505.90.40, HTSUSA, that was based on the “table bomb” being very similar to a “Christmas cracker” - which is specifically listed in the ENs for that heading. The instant Litecubes™ are not similar to Christmas crackers as the Litecubes™ are durable – able to be used multiple times, for varied uses, for over 12 total hours, they can be shut off and turned back on, and are refreezable. Therefore, for the aforementioned reasons, we do not find the Litecubes™ to be articles classifiable in heading 9505, HTSUSA.

The Litecubes™ have a LED which, when turned on, provides light which may illuminate objects and areas. “Lamp” is defined in The Random House College Dictionary, Random House, Inc. (1973), at 752, as “a device providing an isolated source of artificial light”. Webster’s New Collegiate Dictionary, G. & C. Merriam Company (1979), at 639, defines “lamp” as “any of various devices for producing light or heat”. We find that the Litecube™ falls within these definitions of “lamp”.

Under the language of the HTSUSA, Customs has determined that articles which light up but are of a decorative nature, rather than being used to provide usable light for illuminating an area, are provided for under heading 9405, HTSUSA. See HQ 965248 (July 26, 2002). One particular type of article of this nature specifically provided for eo nomine in this heading is light sets of a kind used for Christmas trees (subheading 9405.30.00, HTSUSA). Light sets which are not intended for Christmas trees also fall within this heading, under subheading 9504.40.80, HTSUSA. See HQ 962901 (September 28, 1999), citing Primal Lite, Inc. v. United States, 15 F. Supp. 2d 915 (Ct. Int’l Trade 1998); aff’d 182 F.3d 1362 (CAFC 1999). Customs found that an electric light “not intended primarily for illumination but for decoration” was classified as other electric lamps and lighting fittings, other, under subheading 9405.40.80, HTSUSA. NY F83270 (March 6, 2000). Like the electric light in NY F83270, although the Litecube™ is not intended primarily for illumination but for decorative purposes, it is still classifiable as an electric lamp under 9405, HTSUSA. Therefore, we find that the Litecube™ is classified under subheading 9405.40.8000, HTSUSA, which provides for: “lamps and lighting fittings including searchlights and spotlights and parts thereof, not elsewhere specified or included; illuminated signs, illuminated nameplates and the like, having a permanently fixed light source, and parts thereof not elsewhere specified or included: other electric lamps and lighting fittings: other.”

HOLDING:

In accordance with the above discussion, the Litecubes™ are classified in subheading 9405.40.8000, HTSUSA, which provides for: “Lamps and lighting fittings including searchlights and spotlights and parts thereof, not elsewhere specified or included; illuminated signs, illuminated nameplates and the like, having a permanently fixed light source, and parts thereof not elsewhere specified or included: other electric lamps and lighting fittings: other.” The 2004 column one, general rate of duty rate is 3.9% ad valorum. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUSA and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.

EFFECT ON OTHER RULINGS:

NY G81588 is affirmed.

Sincerely,

Myles B. Harmon, Director
Commercial Rulings Division


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