HQ 225814: Application for further review of Protest No. 1801-94- 100043; 19 U.S.C. 1520(c)(1); mistake of fact

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 225814

                        February 26, 1996




LIQ-9-01-RR:IT:EC   225814 CC 

CATEGORY: Liquidation

Port Director 
U.S. Customs Service
4430 East Adamo Drive, Suite 301
Tampa, FL 33605

RE:  Application for further review of Protest No. 1801-94-      100043; 19 U.S.C. 1520(c)(1); mistake of fact

Dear Sir or Madam:

     The above-referenced protest was forwarded to this office
for further review.  We have considered the facts and issues
raised, and our decision follows.

FACTS:

     This protest consists of 15 entries, which the protestant
states are "internal drives."  The dates of entry for the subject
merchandise range from December 24, 1991 to July 15, 1992.  The
dates these entries were liquidated range from May 29, 1992 to
November 6, 1992.  The entries were liquidated under subheading
8471.93.60 of the Harmonized Tariff Schedule of the United States
(HTSUS), which provides for automatic data processing machines
and units thereof, other, storage units, whether or not entered
with the rest of a system, other storage units, other.  

     On March 1, 1993 the protestant requested, in accordance
with 19 U.S.C. 1520(c)(1), that you reliquidate the entries under
subheading 8471.93.50, HTSUS, which provides for automatic data
processing machines and units thereof, other, storage units,
whether or not entered with the rest of a system, other storage
units, not assembled in cabinets for placing on a table, desk,
wall, floor or similar place. 

     Therefore, the protestant's claim is that there was a
mistake of fact in classifying the merchandise.  The protestant
claims that the broker who filed the entries believed that the
subject merchandise was "external drives" when it was "internal
drives," classifiable under subheading 8471.93.50, HTSUS.

     On July 15, 1994 the section 1520(c)(1) claim was denied. 
This protest on the denial of the section 1520(c)(1) claim was
filed on October 13, 1994.

ISSUE:

     Whether Customs properly denied the protestant's request to
reliquidate the subject entries under 19 U.S.C. 1520(c)(1)?

LAW AND ANALYSIS:

     Initially, we note that both the request for reliquidation
under 19 U.S.C. 1520(c)(1) and the protest of the denial of that
request under 19 U.S.C. 1514(a)(7) were timely filed.

     Under 19 U.S.C. 1520(c)(1), an entry may be reliquidated to
correct a clerical error, mistake of fact, or other inadvertence
not amounting to an error in the construction of the law.  The
error must be manifest from the record or established by
documentary evidence and brought to the attention of the
appropriate Customs officer within one year from the date of
liquidation.  As stated in PPG Industries, Inc. v. United States,
7 CIT 118 (1984), the following three conditions must be
satisfied in order for an entry to be reliquidated to correct a
mistake of fact pursuant to section 1520(c)(1):
     
     (1) A mistake of fact must exist;
     
     (2) The mistake of fact must be manifest from the
     record or established by documentary evidence; and 
     
     (3) The mistake of fact must be brought to the
     attention of the Customs Service within the time
     requirements of the statute.
     
     Consequently, the protestant must first show that the
subject merchandise was misclassified.  In the 1520(c)(1) claim,
the protestant states that the merchandise the subject of the
protest is "tape drives - data storage devices for computers." 
In addition, it is stated in the 1520(c)(1) claim, "internal tape
drive models ... ,properly classified [under subheading]
8471.93.5000 (Free), were incorrectly entered as external drives
under [subheading] 8471.93.6000 (dutiable at 3.7% ad. val.)."  In
support of this claim the protestant states, [b]ills of material
for the models involved are enclosed with this letter,
demonstrating that the models involved were in fact internal
drives."  The claims concerning the alleged misclassification are
essentially the same in the protest.  Concerning these claims
counsel for the protestant states the following:
     
     The misclassification here was due to a mistake of fact
     in that the customs broker filing the entry believed
     that the internal drives were in fact external drives. 
     Hence, we claim that the internal tape drive models the
     subject of this protest, assessed with duty under HTS
     item 8471.93.6000, at 3.7% ad valorem, are properly
     classifiable under HTS item 8471.93.5000, duty free.
               The claims and supporting evidence before us do not show
that the subject merchandise was classified improperly; in fact,
the evidence before us is insufficient to properly classify the
subject merchandise.  There is not contained in the file any
clear explanation of what the merchandise is, any clear
description of the merchandise, or any other information to make
it possible to properly classify the merchandise.  In addition,
there is no explanation, based on the characteristics and
attributes of the merchandise, why it fits the terms of the
purported classification, subheading 8471.93.50, HTSUS.  All that
we have before us are vague assertions and suppositions about
internal and external drives, and bills of material that are
alleged to show that the merchandise was improperly classified. 
As stated by the Court of International Trade in Bar Bea Truck
Leasing Co., Inc. v. United States, 5 CIT 124, 126 (1983),
assertions of counsel are not evidence.  See also, United States
v. Lineiro, 37 CCPA 5, 10, C.A.D. 410 (1949), "[d]etermination of
issues in customs litigation may not be based on supposition."    
     
     Based on the foregoing, we cannot find that the subject
merchandise was improperly classified.  Consequently, no mistake
of fact exists for the tariff classification of the subject
merchandise. 

     Even it were shown that classification of the subject
merchandise was incorrect, the protestant's request for
reliquidation pursuant to section 1520(c)(1) could not be
approved for the following reasons.
     
     A mistake of fact occurs when a person understands the facts
to be other than what they really are and takes some action based
on that erroneous belief, whereas a mistake of law occurs when a
person knows the true facts of the case but has a mistaken belief
as to the legal consequences of those facts.  See, e.g., C.J.
Tower & Sons of Buffalo, Inc. v. United States, 68 Cust. Ct. 17,
21, C.D. 4327, 336 F. Supp. 1395 (1972), aff'd, 61 CCPA 90,
C.A.D. 1129, 499 F.2d 1277 (1974);  Hambro Automotive Corp. v.
United States, 81 Cust. Ct. 29, 458 F.Supp. 1220 (1978), aff'd,
66 CCPA 113, 603 F.2d. 850 (1979); and PPG Industries, Inc. v.
United States, 7 CIT 118 (1984).  The courts have taken the
position that generally an error in the classification of
merchandise is not a clerical error, mistake of fact, or
inadvertence within the meaning of 19 U.S.C. 1520(c)(1), but is
an error in the construction of the law.  See, e.g., Cavazos v.
United States, 9 CIT 628 (1985); Mattel, Inc. v. United States,
72 Cust. Ct. 257, C.D. 4547, 377 F.Supp. 955 (1974); and Fibrous
Glass Products v. United States, 63 Cust. Ct. 62, C.D. 3874
(1969), appeal dismissed, 57 CCPA 141 (1970).
     
     The protestant claims that the mistake of fact was that the
broker filing the entry believed that the merchandise was
something other than what it was; the broker believed the
merchandise was "external drives," when it was "internal drives." 
In the 1520(c)(1) claim, this "incorrect belief" is attributed to
"faulty communications between [the company] and [its broker] as
to which models were internal and which models were external,"
and "[c]ertain inaccuracies in the descriptions shown on invoices
prepared by the exporter."  In support of these claims, bills of
material for the models involved were submitted with this
explanation: "[p]lease note the absence of enclosures from the
list of parts on the bills."  In addition, pro-forma invoices
were submitted.  

     According to the court in PPG Industries, Inc., v. United
States, 4 CIT 143, 147-148 (1982), quoting in part from the lower
court in Hambro Automotive Corp. v. United States, 81 Cust. Ct.
29, 31, 458 F. Supp. 1220, C.D. 4761 (1978)):
           
          In asserting that the subject merchandise has been
     wrongly classified due to a mistake of fact, it is
     incumbent on the plaintiff to show by sufficient
     evidence the nature of the mistake of fact.  The burden
     and duty is upon the plaintiff to inform the
     appropriate Customs official of the alleged mistake
     with "sufficient particularity to allow remedial
     action."  
     
     In addition, as stated above, a mistake of fact must be manifest
from the record or established by documentary evidence.  See, ITT
Corp. v. United States, 24 F. 3d 1384, 1387 (Fed. Cir. 1994),
Mistakes of fact that are not manifest from [the] record ... must
be established by documentary evidence"; see also, United States
v. Lineiro, supra, "[d]etermination of issues in customs
litigation may not be based on supposition."  The bill of
materials submitted by the protestant is essentially a long list
of part numbers.  The pro-forma invoices also contain part
numbers, along with information such as sales order numbers and
prices.  The protestant has underlined what it considers
merchandise that is "internal drives."  There is no explanation,
however, how one concludes that the underlined items in the pro-forma invoice are "internal drives" based on the information
contained in the invoice and the bill of materials.  Moreover,
the submitted information fails to show what was the mistake of
fact.  Consequently, there has not been sufficient evidence
presented as to the nature of the mistake of fact, nor is there
sufficient documentary evidence to show that a mistake of fact
existed.  

     Finally, counsel for the protestant has sought to rely on  
ITT Corp. v. United States, 812 F.Supp. 213 (CIT 1993), in
support of its claim, stating that the court found in that case
that a mistake of fact occurred when the document preparer
understood that the nature of the merchandise was other than what
it was.  Contrary to counsel's assertions, this case, upon
further analysis, appears to contradict rather than support the
protestant's contentions.  

     The court's conclusion that there was a mistake of fact was
based on evidence presented at the trial, which was not present
before Customs when the request for reliquidation was made.  At
that time, the evidence before Customs did not demonstrate what
was the correct classification, nor the nature of the alleged
error.  The court concluded, therefore, "[t]he nature of the
error and the correct classification was not manifest from the
record or established by documentary evidence before Customs
rendered its decision."  That conclusion applies equally to the 
protestant's claim in this matter.     

     Based on the foregoing, no mistake of fact is present, and
no remedy is available under 19 U.S.C. 1520(c)(1).


HOLDING:

     No mistake of fact was present under 19 U.S.C. 1520(c)(1) in
an alleged error in the tariff classification of the subject
merchandise.  Consequently, the protest should be DENIED in full.

     In accordance with Section 3A(11)(b) of Customs Directive
099 3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, this decision should be mailed by your office to the
Protestant no later than 60 days from the date of this letter.  
Any reliquidation of the entry in accordance with the decision
must be accomplished prior to mailing of the decision.  Sixty
days from the date of the decision the Office of Regulations and
Rulings will take steps to make the decision available to customs
personnel via the Customs Rulings Module in ACS and the public
via the Diskette Subscription Service, Freedom of Information Act
and other public access channels.



                         Sincerely,




                         Director, International Trade 
                         Compliance Division