OT:RR:CTF:CPMMA H325768 KSG
Ms. Amanda Levitt, Esquire
Mr. Lenny P. Feldman, Esquire
Sandler, Travis & Rosenberg, P.A.
675 Third Avenue
Suite 1805 - 06
New York, NY 10017
[email protected]
RE: Tariff classification of six 12-inch plush articles described as a "Squishmallows" "Squad"
Dear Ms. Levitt and Mr. Feldman:
This letter is in response to your request for a binding ruling on behalf of Kelly Toys Holding, LLC, regarding the tariff classification of a grouping of six different 12-inch plush articles called "Squishmallows" under the Harmonized Tariff Schedule of the United States (HTSUS). We regret the delay in responding to your request.
FACTS:
The items at issue, Item No. SQ20-12ASR-B ( "Squishmallows Assortment B"), is a "squad" of six plush, whimsical, stuffed articles that are imported together but sold individually at retail with a suggested retail price of $14.99-$19.99. They are marketed as a collectible assortment, as shown on their hangtags.
Each individual "Squishmallows" plush animal and creature in this squad is approximately 12" in height. Each individual plush animal is made of polyester felt on its body and is filled with polyester fibers. Each has a comically large body and face combined and resembles the animal or creature that it represents (e.g., octopus, mouse, dragon) with facial features, markings, and notable extremities (e.g., horns, ears, wings). The hangtags create names and personalities for the figures. Each individual plush animal or creature is given a proper name and character description that explains its personality, aspirations , hobbies, and the like, on each individual's hangtag. The articles are extremely soft and smooth to the touch, and extremely squishy, to entice hugs and cuddling.
The panda unicorn figure is black and white with large black rings around its eyes. It has the following appendages with three-dimensional design: two ears, a tail, a unicorn horn, and silver wings. The dragon figure is green and has the following appendages: two ears, wings, scales going down its back and a tail. The mouse figure is grey and has the following appendages: two ears, and a tail. The octopus figure is purple and has eight tentacles. The parrot figure is red and has a tuft of white hair on the top of the figure and two wings. The unicorn has the following appendages: two ears, a tail, and a gold horn.
The figures are collectibles and are distinctive for being soft and squishy. The figures have won toy awards such as "TOY OF THE YEAR", "People's Choice Award" and "Plush Toy of the Year" for 2022 by The Toy Association, Inc. and are marketed and sold as toys in the toy aisles of major retailers and online.
ISSUE:
Whether the six plush articles in the grouping are classified in heading 9404 as pillows or in heading 9503 as toys.
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be determined 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 2 through 6 may then be applied in order.
The 2023 HTSUS headings under consideration are the following:
9404 Mattress supports; articles of bedding and similar furnishing (for example, mattresses, quilts, eiderdowns, cushions, pouffes and pillows) fitted with springs or stuffed or internally fitted with any material or of cellular rubber or plastics, whether or not covered:
9503 Tricycles, scooters, pedal cars and similar wheeled toys; dolls? carriages; dolls, other toys; reduced-scale ("scale?) models and similar recreational models, working or not; puzzles of all kinds; parts and accessories thereof
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System, which constitute the official interpretation of the HTSUS at the international level, may be utilized. The ENs, while neither dispositive nor legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
Chapter Note 1(x), Chapter 95, HTSUS, excludes tableware, kitchenware, toilet articles, carpets and other textile floor coverings, apparel, bed linen, table linen, toilet linen, kitchen linen and similar articles having a utilitarian function (classified according to their constituent material).
The EN to heading 9404, HTSUS, states, in pertinent part, the following:
This heading covers:
...
(B) Articles of bedding and similar furnishing which are sprung or stuffed or internally fitted with any material (cotton, wool, horsehair, down, synthetic fibres, etc.), or are of cellular rubber or plastics (whether or not covered with woven fabric, plastics, etc.).
The EN to heading 9503, HTSUS, states, in pertinent part, the following:
This heading covers:
(D) Other toys.
This group covers toys intended essentially for the amusement of persons (children or adults). However, toys which, on account of their design, shape or constituent material, are identifiable as intended exclusively for animals, e.g., pets, do not fall in this heading, but are classified in their own appropriate heading. This group includes:
...
(i) Toys representing animals or non-human creatures even if possessing predominantly human physical characteristics (e.g., angels, robots, devils, monsters), including those for use in marionette shows.
Although the term "toy" is not defined in the HTSUS, the General Explanatory Notes to Chapter 95, HTSUS, state that the "Chapter covers toys of all kinds whether designed for the amusement of children or adults." Insofar as it pertains to toys, the Court of International Trade construes heading 9503, HTSUS, to be a "principal use" provision. See Minnetonka Brands v. United States, 110 F. Supp. 2d 1020, 1026 (Ct. Int'l Trade 2000). Thus, to be a toy, the "character of amusement involved [is] that derived from an item which is essentially a plaything." Wilson's Customs Clearance, Inc. v. United States, 59 Cust. Ct. 36, C.D. 3061 (1967).
In Processed Plastic Co. v. United States, 473 F.3d 1164 (Fed. Cir. 2006), the court held that "the principal use of a "toy" is amusement, diversion, or play ... rather than practicality." To assist in the determination of whether an article should be classified as a toy or not, the court in Ideal Toy Corp. v. United States 78 Cust. Ct. 28, 33, Cust. Dec. 4688 (1977) stated that "[w]hen amusement and utility become locked in controversy, the question becomes one of determining whether the amusement is incidental to the utilitarian purpose, or the utility purpose incidental to the amusement."
Thus, to be classified as a toy in heading 9503, HTSUS, an article must belong to the same class or kind of goods which have the same principal use as toys.
In Headquarters Ruling Letter (HQ) H275175, dated September 5, 2017, CBP recounted the legal history of classification of toys under heading 9503.
The tariff term "toy" is not statutorily defined. The courts and CBP construe statutorily undefined terms in accordance with their common and commercial meaning, which is presumed to be the same. See E.M. Chems. v. United States, 920 F.3d 910, 913 (Fed. Cir. 1990). However, the courts, through a series of decisions, have crafted a framework for "toys" of heading 9503, HTSUS, which guides CBP in the instant case.
In Springs Creative Products Group v. United States, 35 I.T.R.D. (BNA) 1955, Slip Op. 13-107 (Ct. Int'l Trade Aug. 16, 2013), the Court opined on the tariff classification of a child's craft kit for making a fleece blanket. In its analysis, the Court consulted dictionaries, and other reliable sources regarding the meaning of the word "toy." See Medline Indus. v. United States, 62 F.3d 1407, 1409 (Fed. Cir. 1995) ("tariff terms are construed in accordance with their common and popular meaning, and in construing such terms the court may rely upon its own understanding, dictionaries and other reliable sources.") (citations omitted).
First, the Court consulted Webster's Third New International Dictionary of the English Language Unabridged (1981), at 2419, which provides, in relevant part that "toys" are:
3a: something designed for amusement or diversion rather than practical use b: an article for the playtime use of a child either representational (as persons, creatures, or implements) and intended esp. to stimulate imagination, mimetic activity, or manipulative skill or nonrepresentational (as balls, tops, jump ropes) and muscular dexterity and group integration.
Next, the Court cited Merriam Webster's Collegiate Dictionary (1998) at page 41, which defines "amusement" in relevant part as, "3: a pleasurable diversion." Thus, taken together "[t]his common meaning of toy - an object primarily designed and used for pleasurable diversion - is consistent with its judicial interpretation." Springs Creative Products Group v. United States, supra at page 15, citing Processed Plastic Co. v. United States, 473 F.3d 1164, 1170 (Fed. Cir. 2006) (noting that the principal use of a "toy" is amusement, diversion, or play value rather than practicality); Minnetonka Brands, Inc. v. United States, 24 CIT 645, 651 37, 110 F. Supp. 2d 1020, 1026 (2000) (noting that for purposes of Chapter 95, HTSUS, "an object is a toy only if it is designed and used for amusement, diversion, or play, rather than practicality").
Factoring in the above, heading 9503, HTSUS, is a "principal use" provision governed by Additional U.S. Rule of Interpretation 1 (a), HTSUS, which provides that: In the absence of special language or context which otherwise requires--a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use. Group Italglass, U.S.A., Inc. v. United States, 17 CIT 1177, 839 F. Supp. 866 (1993). The Court in Group Italglass stressed "that it is the principal use of the class or kind of good to which the imports belong and not the principal use of the specific imports that is controlling under the Rules of Interpretation." Group Italglass, 839 F. Supp. at 867. Principal use is defined as the use "which exceeds any other single use." Automatic Plastic Molding, Inc., v. United States, 26 CIT 1201, 1205 (2002). HQ H275175, supra.
Accordingly, to determine whether an article is included in a particular class or kind of merchandise, CBP considers a variety of factors, often referred to as the "Carborundum" factors, to determine whether articles are classifiable as toys. The factors include: (1) the general physical characteristics of the merchandise; (2) the channels, class or kind of trade in which the merchandise moves (where the merchandise is sold); (3) the expectation of the ultimate purchasers; (4) the environment of the sale (i.e., accompanying accessories and marketing); (5) usage, if any, in the same manner as merchandise which defines the class. See United States v. Carborundum Co., 536 F.2d 373, 377 (Cust. Ct. 1976). While these factors were developed under the Tariff Schedule of the United States (the predecessor to the HTSUS), the courts, and this office have applied and continue to apply them to the HTSUS. See, e.g., Minnetonka Brands v. United States, supra; Aromont USA, Inc. v. United States, 671 F.3d 1310 (Fed. Cir. 2012), and see Essex Mfg., Inc. v. United States, 30 C.I.T. 1 (2006).
Application of the Carborundum factors to the Squishmallows results in their classification under heading 9503, HTSUS, as toys.
(1) The general physical characteristics of the merchandise are intended to amuse rather than be utilized as a typical pillow: Each individual plush animal is made of polyester felt on its body and is filled with polyester fibers. Each has a comically large body and face combined but and resembles the animal or creature that it represents (e.g., octopus, mouse, dragon) with facial features, markings, and notable extremities (e.g., horns, ears, wings).
(2) The channels, class or kind of trade in which the merchandise moves (where the merchandise is sold) is predominantly in the toy sections, aisles and websites of stores and companies, rather than in the bedding or homewares aisles, departments or sections.
(3) The expectation of the ultimate purchasers is to provide a child with a named plush toy with which the child can play and bond with like a teddy bear or blanket that many children take everywhere for amusement and emotional comfort.
(4) The environment of the sale (i.e., accompanying accessories and marketing) is, as stated in the discussion of factor 2, predominantly in the toy aisles, departments and sections of websites and not in the homewares or bedding departments with other pillows, blankets and bedding.
(5) The primary usage of Squishmallows is the amusement of children, in the same manner as merchandise which defines toys classified under heading 9503, HTSUS. The humanized animals have names and personalities and are intended to amuse children in the same manner as a teddy bear.
In Headquarters Ruling Letter ("HQ") H161002, dated March 30, 2012, CBP classified items described as "pillow pets" in heading 9503 as toys. The pillow pets were described in the ruling as follows:
The subject merchandise consists of a number of models of "Pillow Pets," which are stuffed articles that depict various types of animals such as unicorns, bumble bees, alligators, cows, dogs, and ducks. They are constructed with a man-made fiber pile fabric, and each contains a three-dimensional head with facial features such as eyes, nose, ears, snout and antenna as appropriate to the model. Each model also comes in various colors as appropriate to the creature it portrays, and certain models have three dimensional features unique to their creature, such as yellow wings on the butterfly. These features appear on the top of the merchandise, while the bottom of each model is flat, without any defined appendages. The "feet" of each creature are depicted by squares of different color fabric that appear on each end of the torso.
We noted in HQ H161002 that CBP has classified a range of cushions that support the body and increase comfort in heading 9404, HTSUS. Therefore, the determination to be made is whether Squishmallows are more like pillow pets or more like cushions, whose purpose is to support the body and increase comfort.
The 6 plush articles that comprise the Squish squad do not fit fully into a standard pillowcase and would not be used as a pillow to support a person's head when sleeping. The size of the items, their shape, their depth, their plush squishiness, and their colorful and fun design demonstrate that they are designed to amuse rather than be used for utilitarian purpose, and. A personality and a name have been created for each plush creature, characteristics that are intended to humanize the articles for a child's amusement. The articles are not of the correct size or flatness to support the head or the body as a utilitarian pillow and they are not designed to provide or increase comfort. They are similar in design to the pillow pets classified in HQ H161002. The fabric and plush stuffing are extra soft because the articles are intended to be cuddled. They are sold in the toy aisle in stores and sold with other plush toys by major retailers. They have won various toy awards. They are collected by both children and adults. The Squishmallows are sold in stores that feature only them and are also used as prizes at the amusement arcade at the beach. Based on consideration of all these factors, we find that in accordance with GRI's 1 and 6, the 12-inch squad of Squishmallows described above are classified in subheading 9503.00.00, HTSUS.
HOLDING:
By application of GRI's 1 and 6, the articles described above are classified in subheading 9503.00.00, HTSUS. The column one, general rate of duty is Free.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided for at https://hts.usitc.gov/.
Sincerely,
Andrew Langreich, Chief
Chemicals, Petroleum, Metals and Miscellaneous Articles Branch