United States v. Texas Instruments Inc.

620 F.2d 272, 67 C.C.P.A. 59, 1980 CCPA LEXIS 259
Court of Customs and Patent Appeals·Decided April 17, 1980·No. C.A.D. 1244; No. 79-33·Published·Cited by 4 cases

Opinion

Markey, Chief Judge.

The Government appeals from the judgment of the Customs Court, Texas Instruments, Inc. v. United States, 82 Cust. Ct. 272, C.D. 4810, 475 F. Supp. 1183 (1979), sustaining Texas Instruments’ classification protest relating to imported integrated circuit devices used as components in solid-state digital watches.2 We affirm.

Background

The imported articles, entered from El Salvador in August 1976, are integrated circuit devices, each of which is affixed to 'a lead frame and encapsulated in molded plastic material shaped to facilitate addition of other components required to complete a digital watch module, i.e., crystal, capacitor, batteries, and display.

[61]*61The Customs Service classified the imported articles under TSUS item 720.75 3 as assemblies and subassemblies for watch movements. Texas Instruments claimed classification under TSUS item 687.60.4 The Government asserted an alternate classification under TSUS item 720.86 5 as assemblies and subassemblies for clock movements.

Judge Nils A. Boe held: (1) The legislative history of TSUS item 720.75 does not evidence a congressional intent to include every device capable of measuring time within the meaning of “watch movement”; (2) “watch movement” refers to a mechanism possessing moving parts to which or from which motion is transferred; (3) the molecular vibration within the quartz crystal of an electronic watch module does not satisfy that motion requirement; (4) the imported articles do not bear an essential resemblance to watch movements, and are specifically provided for under TSUS item 687.60; (5) the imported articles are not more than integrated circuits; and (6) the imported articles are not classifiable as “clock movements” under TSUS item 720.86, the sole distinction between clock and watch movements being size.

[62]*62Issue

The dispositive issue is whether the Customs Court erred in holding the articles properly classified under TSUS item 687.60 as transistor and other related electronic crystal components rather than as sub-assemblies for watch or clock movements.

OPINION

The Government argues the Customs Court erred because: (1) Legislative history shows a congressional intent to include electronic movements within the term “watch movements”; (2) the quartz crystal incorporated into the imported articles after importation provides movement; (3) the imported articles bear an essential resemblance to watch movement subassemblies in existence when the TSUS was enacted; (4) the articles are more than integrated circuits; and (5) if the articles are not watch movements, they are clock movements.

(1) Legislative History

The Government cites portions of the Tariff Classification Study and the Congressional Record that indicate a congressional intent that electronically regulated movements be classified with conventional movements. Those citations do not, however, persuasively show that a solid-state module having no moving parts was intended by Congress to be included within the provision for “watch movements.” 6 Accordingly, the Customs Court properly determined the meaning of the term “watch movements” by reference to texts and dictionaries in use at the time the TSUS was enacted, the common understanding of the term in the horological industry at that time, and the testimony of experts as to what the term meant when the TSUS was enacted. The conclusion of the Customs Court that the term refers to a mechanism incorporating “moving parts to which or from which motion is transferred,” 82 Cust. Ct. at 278, 474 F. Supp. at 1187, has not been shown to be erroneous by the Government. We agree with the Customs Court that the term requires a mechanism for the transfer of motion. Indeed, until 1972, every watch sold contained a movement meeting that definition. Electronically regulated watch movements, the subject of much discussion when the TSUS were enacted (and of the legislative history cited by the Government), also have moving parts and thus meet that definition. The Customs Court correctly decided that the articles at issue here, having no mechanism for the transfer [63]*63of motion, were not “movements” or subassemblies of “movements” within the meaning of that term as it was understood in 1962.

(3) Quartz Crystal Motion

The Government argues that even if motion is required by the definition of watch movement, that requirement is satisfied by the vibration of the quartz crystal later incorporated into the imported articles. We do not accept that contention. The magnitude of the motion within the crystal is roughly one angstrom (one ten-billionth of a meter); the motion is essentially molecular vibration; and the motion does not transmit mechanical energy or transfer motion to or from any other part.

(3) Essential Resemblance

The Government argues that the imported articles bear an essential resemblance to subassemblies for watch movements in existence when the TSUS were enacted and thus should be classified with them. That argument is supported by a functional analysis: because the imported articles and prior subassemblies are used to keep time and meet certain dimensional requirements, they should be classified together.

The required essential resemblance is to those characteristics established by the TSUS as the criteria -of classification. Davies Turner & Co. v. United States, 45 CCPA 39, 41-42, C.A.D. 669 (1957). The criteria established by the TSUS for classification as a watch movement are: (1) A timepiece movement, (2) less than 1.77 inches wide and 0.5 inch thick. Though the dimensional requirements are met by the imported article, it does not bear an essential resemblance to a timepiece movement because the imported article is not and does not contain a movement. We agree with the Customs Court that the articles are more specifically provided for as transistors and other related electronic crystal components.

(4) “More Than” Integrated Circuits

Arguing that the imported articles are more than integrated circuits, the Government says classification in a TSUS item for integrated circuits is improper because: (1) The encapsulation material serves as a housing for other components; (2) the lead frame serves as the device’s substrate; and (2) not all the usable terminals are connected to external leads.

“Only the most general of rules can be ascertained from the previous decisions dealing with the ‘more than’ doctrine, and it appears that each case must in the first analysis be determined on its own facts.” [64]*64E. Green & Son (New York), Inc. v. United States, 59 CCPA 31, 34, C.A.D. 1032, 450 F.2d 1396, 1398 (1971). This court will not reverse on questions of fact unless the findings are unsupported by substantial evidence or are clearly contrary to the weight of the evidence. Pollard Bearings Corp. v. United States, 62 CCPA 61, 64, C.A.D. 1146, 511 F.2d 568, 571 (1975); United States v. F. W. Myers & Co., 45 CCPA 48, 52, C.A.D. 671 (1958).

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United States v. Texas Instruments Inc., 620 F.2d 272, 67 C.C.P.A. 59, 1980 CCPA LEXIS 259 (ccpa 1980).

620 F.2d 272 (United States v. Texas Instruments Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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