Well Luck Company, Inc. v. United States
887 F.3d 1106
Fed. Cir.2018Background
- Well Luck imported in-shell sunflower seeds (roasted/wet-cooked, salted, flavored or unflavored) sold for snacking; seeds are Helianthus annuus and intended for human consumption, not oil extraction.
- Processing: selection, heated to ~302°F (~65 minutes), salt added during heating, cooled, packaged in-shell for retail importation.
- U.S. Customs classified the imports under HTSUS subheading 2008.19.90 (prepared/preserved edible seeds) at 17.9% ad valorem; Well Luck protested seeking classification under HTSUS 1206.00.00 (sunflower seeds) which is duty-free.
- The U.S. Court of International Trade granted summary judgment to the Government; Well Luck appealed to the Federal Circuit.
- The parties agreed facts were undisputed; the legal question was whether the merchandise is classified under HTSUS heading 1206 (eo nomine "sunflower seeds") or heading 2008 ("fruit, nuts and other edible parts of plants, otherwise prepared or preserved").
Issues
| Issue | Plaintiff's Argument (Well Luck) | Defendant's Argument (United States) | Held |
|---|---|---|---|
| Whether the snacking seeds are prima facie classifiable under HTSUS heading 1206 as "sunflower seeds" | Term is eo nomine and common/commercial meaning of "sunflower seeds" includes snacking seeds | The common/commercial meaning does not necessarily include processed/snacking seeds | Held: Yes — dictionaries and industry sources show "sunflower seeds" covers edible, oil‑rich seeds, so merchandise is prima facie classifiable under 1206 |
| Whether the seeds are prima facie classifiable under HTSUS heading 2008 as "prepared or preserved" edible seeds | If 1206 applies, classification inquiry ends in plaintiff's favor | Seeds are also "prepared or preserved" (roasted, salted, flavored, packaged) so they fit heading 2008 | Held: Yes — merchandise is also prima facie classifiable under 2008 |
| When prima facie classification under multiple headings, which heading governs (application of GRI 3(a)) | If 1206 applies eo nomine, it should control (plaintiff argued no further step required) | GRI 3(a) requires choosing the most specific heading; 2008’s requirement of "prepared or preserved" is harder to satisfy and thus more specific | Held: GRI 3(a) favors heading 2008 as more specific, so heading 2008 governs |
| Appropriate subheading under heading 2008 | Plaintiff sought relief under 1206; did not contest 2008.19.90 specifically | Merchandise does not fit narrower 2008 subheadings; fits catch‑all 2008.19.90 | Held: Classified under HTSUS subheading 2008.19.90 ("other, including mixtures: other") |
Key Cases Cited
- Otter Prods., LLC v. United States, 834 F.3d 1369 (Fed. Cir.) (standard of review for CIT summary judgment)
- Schlumberger Tech. Corp. v. United States, 845 F.3d 1158 (Fed. Cir.) (eo nomine analysis and reliance on dictionary meaning)
- LeMans Corp. v. United States, 660 F.3d 1311 (Fed. Cir.) (two‑step classification inquiry and GRI 3 application)
- Sigma‑Tau HealthSci., Inc. v. United States, 838 F.3d 1272 (Fed. Cir.) (limiting use of ENs to narrow heading language)
- Fuji Am. Corp. v. United States, 519 F.3d 1355 (Fed. Cir.) (ENs provide persuasive guidance)
- Orlando Food Corp. v. United States, 140 F.3d 1437 (Fed. Cir.) (more specific heading is the one harder to satisfy)