                        Slip. Op. 01-98____

           UNITED STATES COURT OF INTERNATIONAL TRADE
            BEFORE: RICHARD W. GOLDBERG, SENIOR JUDGE

___________________________
                            X
THOM S. ZANI D/B/A          X
WHOLESALE ART & FRAME LTD., X
                            X
          Plaintiff,        X         Court No.    95-07-00907
                            X
          v.                X
                            X
UNITED STATES,              X
                            X
          Defendant.        X
                            X
____________________________X

[Judgment for Plaintiff]

Peter S. Herrick and Neil B. Mooney, for plaintiff.

Stuart E. Schiffer, Acting Assistant Attorney General; Joseph I.
Leibman, Attorney in Charge, International Trade Field Office
(Amy M. Rubin), Commercial Litigation Branch, Civil Division,
United States Department of Justice.

                                           Dated: August 9, 2001


                           O P I N I O N

GOLDBERG, Senior Judge: This matter is before the Court following

trial de novo.   It involves the proper classification of certain

paintings from Hong Kong and South Korea.     Upon review of the

evidence presented at trial, the Court finds in favor of the

plaintiff, Thom S. Zani.   The Court exercises jurisdiction

pursuant to 28 U.S.C. § 1581(a) (1994).
                                                      Page 2


                             BACKGROUND

     The merchandise at issue was classified by the United States

Customs Service (“Customs”) under the provision for “[o]ther made

up articles:...Other” in subheading 6307.90.99 of the Harmonized

Tariff Schedule of the United States (“HTSUS”).     Plaintiff, an

importer and distributor of paintings and frames, claims that the

merchandise is properly free of duty under the provision in

subheading 9701.10.00 HTSUS, for “[p]aintings, drawings, and

pastels, executed entirely by hand.”      On the merits, the issue is

whether the imports were “executed entirely by hand,” as claimed

by the plaintiff.

     On September 15, 1997, Senior Judge James L. Watson granted

summary judgment to defendant, sustaining Customs’s

classification.    Zani v. United States, 976 F. Supp. 1033 (CIT

1997).    On appeal, the Federal Circuit vacated the grant of

summary judgment and remanded for a trial to resolve disputed

issues of fact, including the reliability of Customs’s laboratory

test.    See Thom S. Zani d/b/a Wholesale Art & Frame Ltd. v.

United States, Appeal No. 97-1115, 1998 WL 729247 (Fed. Cir.

October 16, 1998).    Specifically, the Federal Circuit remanded

the case, “[b]ecause there are genuine issues of fact to be

resolved, including the adequacy of the Custom Service’s sampling

of the paintings imported by Mr. Zani, the reliability of the
                                                    Page 3

Customs Service’s laboratory report regarding the sampled

paintings, and the exact nature of the methods used in producing

the paintings at issue, and because there is an open question as

to the meaning of the term ‘stencil’ in relation to subheading

9701.10.00 of the HTSUS.”    Id.

     A bench trial was held on January 11, 2001, in Fort

Lauderdale, Florida.

                          STANDARD OF REVIEW

     Customs’s tariff classification decisions are presumed to be

correct, and the importer has the burden of proving otherwise.

See 28 U.S.C. § 2639(a)(1)(1994).    To determine whether the

importer has overcome this presumption, the Court must consider

whether Customs’s classification is correct. This evaluation is

conducted both independently and in comparison with the

importer’s proposed alternative.    See Jarvis Clark Co. v. United

States, 2 Fed. Cir. (T) 70, 75, 733 F.2d 873, 878 (1984) reh’g

denied, 2 Fed. Cir. (T) 97, 739 F.2d 628 (1984).

                              DISCUSSION

I.   ARGUMENTS AT TRIAL

     At trial, Customs argued that the imports are properly

classifiable under subheading 6307.90.00, HTSUS, rather than

subheading 9701.10.00, HTSUS, because they are not “executed

entirely by hand.” Customs claimed that its classification
                                                    Page 4

decision is supported by laboratory testing and a report by the

Customs laboratory in Savannah, Georgia dated January 19, 1994,

concluding that the three paintings sampled from the merchandise

at issue were produced with the use of a stencil.   Customs

asserted that the use of a stencil precludes classifying the

merchandise at issue as “executed entirely by hand.”

     The plaintiff contended that Customs’s testing and

laboratory report were unreliable because the samples were not

representative of the subject merchandise and the test utilized

fails under the admissibility factors for the use of “scientific,

technical, or other specialized knowledge.” Daubert v. Merrel Dow

Pharmaceuticals, Inc., 509 U.S. 579, 589 (1993).1   The plaintiff

also argues that the “stencils” referred to in the Explanatory

Notes to the HTSUS are the type that are used in a mechanized

system of manufacturing machine-produced painted or silk-screened

articles.   Therefore, because plaintiff’s artists only

occasionally use a single hand-held stencil when painting, the



     1
      Daubert established that when considering the admissibility
of scientific, technical or specialized knowledge, evidence or
expert testimony a court should consider: 1) the testability of
the hypothesis; 2) whether the theory or technique has been
subject to peer review or publication; 3) the known or potential
error rate; and 4) whether the technique is generally accepted.
See Daubert, 509 U.S. at 589. In Libas Ltd. v. United States,
193 F.3d 1362 (Fed Cir. 1999), the Federal Circuit explicitly
expanded the Daubert test to questions of reliability.
                                                      Page 5

plaintiff argues that the artwork is “executed entirely by hand”

under subheading 9701.10.00.

II.   CUSTOMS’S LABORATORY TEST AND REPORT

      Customs based its classification on a test it conducted on

three paintings sampled from the merchandise at issue.     See Gov’t

Ex. A., Notice of Damage, Shortage, or Samples Retained (“Sample

Notice”); Gov’t Ex. B., United States Custom Service Laboratory

Report (“Lab Report”).   After a visual inspection with the aid of

a magnifying glass, a trained chemist of the Customs Service

Laboratory in Savannah, Georgia, Ms. Laurie Lungwitz, concluded

that “the paintings showed evidence that a mechanical device (a

stencil) was used in the production of the paintings,” and thus

“the paintings were not executed entirely by hand.”     See Lab

Report.   Ms. Lungwitz testified that the paintings showed no

evidence of brush strokes and the paint appeared, in part, to be

applied by spray application.    See id.     Three separate Customs

employees verified the test results.   See id.

      The trial testimony and evidence, however, exposed

significant shortcomings in both Customs’s general testing

procedure and this specific test.   First, the plaintiff

established that the entry numbers on the Lab Report and the

entry number on the Sample Notice, did not match.     Through

further testimony, Customs was able to explain the discrepancy as
                                                         Page 6

a likely typographical error.         The entry number discrepancy,

however, regardless of the cause, damages the integrity of the

laboratory test.

       Second, the testimony revealed that Customs destroyed the

sampled paintings.      During the trial, Ms. Lungwitz explained that

under normal Customs procedure an import specialist would notify

the Customs laboratory to retain samples once a protest is filed.

In this case, however, for some reason the import specialist

failed to make that notification, and the sampled paintings were

destroyed.

       Third, on cross-examination Ms. Lungwitz testified that

Customs’s laboratory test did not meet any of the Daubert

factors.       See 509 U.S. at 589.

III.       TESTIMONY OF WANDA BARNEY

       Ms. Barney, a professional artist, was qualified by the

Court as an expert to testify on the issue of whether the

paintings were painted by hand.2        Ms. Barney testified that in

       2
     Customs challenged the Court’s expert witness designation
of Ms. Barney. The Court, however, considered Ms. Barney to be
qualified as an expert for the purposes of determining if art
objects were created by hand. See F.R.E. 702. Ms. Barney
testified that in over thirteen years as a professional artist
she created thousands of art objects using oils, acrylics,
watercolors, mixed media, media collages, silk screening, paper
casting, sculpturing, and bas relief. The Court determined that
Ms. Barney’s knowledge, skill, experience and training would
assist the Court in understanding the evidence. See id.
                                                    Page 7

late 1993 or early 1994, while visiting Zani’s place of business,

she examined the paintings that are now at issue in this case.

Ms. Barney determined that the paintings were painted by hand and

not printed.    Further, during her testimony, Ms. Barney examined

a painting similar to the paintings at issue and determined, by

considering its texture and layering, that it was executed

entirely by hand.

      The Court found Ms. Barney’s testimony to be credible.

Moreover, the Court notes that Customs was not successful in

discrediting either Ms. Barney’s qualifications or testimony.

IV.       ANALYSIS

      The Court finds that Customs improperly classified the

merchandise at issue.   Based upon the evidence presented at

trial, the paintings should have been considered to be executed

entirely by hand and thus classified under subheading 9701.10.00,

HTSUS.    Specifically, the Court finds that the plaintiff has

overcome the presumption of correctness enjoyed by Customs, and

that Customs’s laboratory test has proven to be unreliable in

this instance.3


      3
      The Court is mindful of the Federal Circuit’s concerns
regarding the adequacy of Customs’s sampling and the meaning of
the term “stencil” within the HTSUS. See Zani, 976, F. Supp. at
1033. The Court declines to address these issues, however, as
the adequacy of Customs’s laboratory test is the only inquiry
necessary for resolution of this case.
                                                     Page 8

     As a threshold matter, the Court finds that the plaintiff

has overcome the presumption of correctness enjoyed by Customs.

See Jarvis, 733 F.2d at 878.    Ms. Barney testified that in her

professional opinion the paintings were executed entirely by

hand.   As indicated supra, the Court considered Ms. Barney’s

testimony to be credible, notwithstanding challenges made by

Customs.   During the trial, Customs argued that the plaintiff had

not presented enough evidence to overcome the presumption of

correctness.   The Court agrees with Customs that stronger

evidence would be preferable.    Specifically, the Court would

prefer that Ms. Barney examine the same samples examined by

Customs’s laboratory.   Customs, however, destroyed such samples.

The Court will not allow Customs to benefit from its own

mismanagement of the tested samples.

     Next, the Court finds that Customs’s laboratory test was

unreliable in this instance.    The test, as used here, was

unreliable both because the destroyed samples could not be

examined in conjunction with the laboratory report, and because

the entry number discrepancy calls into question both the chain

of custody and the general accuracy of Customs’s work.

     The Court also questions whether the Customs’s laboratory

test satisfies a Daubert analysis.     Ms. Lungwitz testified that

the test did not meet any of the Daubert factors.     Ms. Lungwitz’s
                                                   Page 9

testimony is the only trial evidence on the matter.   The Court

recognizes that the Daubert test is not a bright-line test, and

that the factors should be considered within the context of the

test.4   The Court falls short of declaring that Customs’s

laboratory test fails the Daubert analysis for reliability in all

instances.   The Court, however, does find in this instance that

Customs has presented no evidence of Daubert reliability.    Thus,

for purposes of this case, Customs’s test is deemed unreliable.

                            CONCLUSION

     Because the evidence at trial established that Custom’s

laboratory test was unreliable in this instance, the Court finds

that Customs erred in classifying the merchandise under

subheading 6307.90.99, HTSUS.   Further the Court finds that the

merchandise is properly classifiable under subheading 9701.10.00,

HTSUS.




     4
     For instance, the court considers that peer review is
likely impractical in this context, because few individuals or
organizations would find it necessary to examine a painting to
determine if it was executed entirely by hand.
                                                  Page 10


                              JUDGMENT

     This case having been heard at trial and submitted for
decision, and the Court, after due deliberation, having rendered
a decision herein; now, in conformity with said decision, it is
hereby

     ORDERED, ADJUDGED, and DECREED: that the classification of
the merchandise at issue in this case, certain paintings from
Hong Kong and Korea, by the United States Customs Service
("Customs") under subheading 6307.90.99 of the Harmonized Tarrif
Schedule of the United States ("HTSUS") is reversed; and it is
further
     ORDERED, ADJUDGED, and DECREED: that Customs shall
reliquidate the aforementioned subject merchandise under
subheading 9701.10.00 of the HTSUS. Customs shall refund all
excess duties paid with interest as provided by law. Judgment is
hereby entered for plaintiff.




                                     ____________________________
                                          Richard W. Goldberg
                                             SENIOR JUDGE
      Dated: August 9, 2001
      New York, New York
