Airco Speer Division, Air Reduction Co. v. United States

U.S. Customs Court

Airco Speer Division, Air Reduction Co. v. United States

64 Cust. Ct. 737, 1970 Cust. Ct. LEXIS 3116

CourtUnited States Customs Court

DecidedJune 11, 1970

DocketR.D. 11710; Entry Nos. 770300, etc.

StatusPublished

Cited by1 cases

This text of 64 Cust. Ct. 737 (Airco Speer Division, Air Reduction Co. v. United States) is published on Counsel Stack Legal Research, covering United States Customs Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Airco Speer Division, Air Reduction Co. v. United States, 64 Cust. Ct. 737, 1970 Cust. Ct. LEXIS 3116 (cusc 1970).

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Opinion

Fokd, Judge:

This case is an appeal for reappraisement brought by an American manufacturer of merchandise of the same class or kind as that comprising the importations herein. Plaintiff has fulfilled the necessary requirements for commencing an action by an American manufacturer pursuant to section 516(a), Tariff Act of 1930, as amended. Documents indicating compliance with such requirements were placed in evidence as plaintiff’s collective exhibits 1-A, 1-B, and 1-C.

The merchandise consists of fixed carbon composition resistors imported from Japan. Plaintiff contends the imported merchandise should be subject to appraisement as an article appearing on the final list of the Secretary of the Treasury, T.D. 54521. Plaintiff claims the imported merchandise falls within the description “Television apparatus, and parts thereof (except cameras), wholly or in chief value of metal.” This claim would, if upheld, require the appraisement of the instant importations on the basis of the higher of foreign or export value under the provisions of section 402(a), Tariff Act of 1930, as amended by the Customs Simplification Act of 1956, 70 Stat. 943, rather than on the basis of export value under the provisions of section 402(b), Tariff Act of 1930, as amended, supra, as was done by the appraising official.

A pretrial conference was held to clarify the issues in this case and as a result thereof this court limited the issue to whether “the involved resistors [1] are wholly or in chief value of metal and [2] are in truth and in fact parts of .television apparatus.”

The record in this trial consists of the testimony of eight witnesses called on behalf of the plaintiff, twenty-eight exhibits introduced into evidence on behalf of plaintiff, and six exhibits introduced on behalf of defendant.

The dual aspect of plaintiff’s burden of proof lends itself to discussion in two phases. The first question relates to whether the imported resistors are in chief value of metal.

The testimony of five witnesses bears on this issue. They were Dr. Michael L. Pearce, the manager of the Chemical and Physical Measurements Group of plaintiff’s research department; George F. Chadwick, plaintiff’s manager of electronic component development, Clarence F. Fritz, plaintiff’s director of quality control and inspection, [739]*739William A. B. Simpson, manager of the statistical section of the Phelps-Dodge Corporation, and Robert E. Baker, director of manufacturing for the plaintiff. Their testimony related to the nature and composition of the resistors in question, the process of manufacture and the value of the component materials.

Dr. Pearce testified that a research group, working under his supervision, performed two separate programs of laboratory analyses and comparisons between imported resistors and plaintiff’s resistors. The first series of tests were performed on imported resistors of the manufacturer herein which were secured by plaintiff and are represented in plaintiff’s collective exhibit 10-A. The second series of tests were performed on representative samples of the importations supplied by the party-in-interest during the course of the trial, and represented in plaintiff’s collective exhibit 25. In both these tests, plaintiff’s resistors and the imported resistors were subjected to microscopic examination, spectrographic and X-ray diffraction analysis and infrared spectrophotometry and ashing techniques. In addition, their weights and dimensions were measured.

The results of these tests were summarized in written reports received in evidence as plaintiff’s exhibits 11 and 12. The basic conclusion reached is that the two groups of resistors are extremely similar in size, weight, design, construction and composition, so much so that there is no significant difference between them. The only difference of any note which was detected was that the metallic coating on the leads of plaintiff’s resistors is relatively pure tin while that on the imported resistors is a lead tin alloy. In addition, the witness testified that a report of similar analyses, conducted by the United States Customs Laboratory and introduced into evidence as plaintiff’s exhibit 12-A, reached conclusions substantially the same as those reached in his own researchers.

Mr. Chadwick testified primarily with regard to the process involved in the composition and manufacture of fixed carbon composition resistors. He testified that the resistance qualities of a resistor are directly related to the relative proportions of inert or nonconducting material that is mixed with carbon black in the core of the resistor. He stated that if the resistance value of a resistor is known and its component materials identified, it must of necessity follow that the relative proportions of the components can be predicted. In short, he stated that the rating of the resistor predetermines its size and composition and that the proportions and amounts of materials used in the imported resistors were closely similar to those used by plaintiff in resistors of the same resistance values.

The witness further testified that the production steps involved in producing such resistors must be substantially the same. With the aid [740]*740of a schematic drawing, placed in evidence as plaintiff’s exhibit 27, the witness testified regarding the final assembly of a resistor. Before final assembly, resin is mixed with inert filler to form the material which will form the shell of the resistor. Resin is also mixed with the inert filler and a conductor, such as carbon black, to form the core material.

During the final assembly, the core mix and shell mix are brought together in a molding step and the wire leads are then incorporated into the resulting body.

The witness was not able to identify the manufacturer and qualities of certain longitudinal cross sections of resistors placed in evidence as defendant’s exhibits A through F.

Mr. Fritz testified primarily with regard to whether or not the imported resistors and those of the plaintiff which they resembled were of a military grade. He stated that tests were made under his supervision of a sampling of imported resistors supplied by the party-in-interest and samples of resistors of the same resistance values supplied by plaintiff. The results of these tests, conducted under specified physical and environmental conditions are summarized in a report placed in evidence as plaintiff’s exhibit 14. This report concludes that the resistors involved herein are all of a commercial grade and do not meet the requirement of the military grade that 99 percent function within a tolerance rating of plus or minus 5 percent.

Mr. Fritz also testified that the manufacturer of the imported resis-toi’s, Matsushita, was not listed as a qualified supplier of military grade resistors for use in the United States on a list issued by the Defense Electronics Supply Center, which list was placed in evidence as plaintiff’s collective exhibit 28.

Mr. Simpson testified in connection with the price of electrolytic copper in Japan during the years 1954 to 1967. Pie relied on a publication known as the “Metal Bulletin” published in London which he characterized as the leading authority for world copper prices, and a publication known as “Metal Bulletin Handbook” which he characterized as equally authoritative. Selected pages of these publications were placed in evidence as plaintiff’s collective exhibits 6-A through 6-E, and plaintiff’s exhibit 7 showing respectively, the 1954 and 1967 prices of electrolytic copper in Japan.

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