  United States Court of Appeals
      for the Federal Circuit
                ______________________

        PLEASURE-WAY INDUSTRIES, INC.,
               Plaintiff-Appellant

                           v.

                  UNITED STATES,
                  Defendant-Appellee
                ______________________

                      2017-1190
                ______________________

   Appeal from the United States Court of International
Trade in No. 1:10-cv-00173-RKM, Senior Judge R. Kenton
Musgrave.
                 ______________________

                Decided: January 5, 2018
                ______________________

    JOHN MICHAEL PETERSON, Neville Peterson LLP, New
York, NY, argued for plaintiff-appellant. Also represent-
ed by RICHARD F. O’NEILL.

    MARCELLA POWELL, International Trade Field Office,
Commercial Litigation Branch, Civil Division, United
States Department of Justice, New York, NY, argued for
defendant-appellee.   Also represented by CHAD A.
READLER, JEANNE E. DAVIDSON, AMY M. RUBIN; MICHAEL
W. HEYDRICH, Office of the Assistant Chief Counsel,
United States Bureau of Customs and Border Protection,
2           PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



United States Department of Homeland Security, New
York, NY.
               ______________________

Before TARANTO, CLEVENGER, and STOLL, Circuit Judges.
TARANTO, Circuit Judge.
    Pleasure-Way Industries, Inc., is a manufacturer and
seller of Class B motorhomes, which it sells at dealerships
in the United States and Canada. Between January 2008
and September 2009, having bought 144 Daimler-
Chrysler AG “Sprinter” vans in the United States, Pleas-
ure-Way exported them to its manufacturing facility in
Canada, where it converted them into its Plateau TS and
Ascent TS model motorhomes. The conversion included
installation of interior features such as fully plumbed
kitchen and bathroom fixtures with freshwater and
sewage tanks, water heaters, sleeping quarters, counter-
tops with propane burners, microwave ovens, wall-
mounted televisions, and refrigerators. The conversion
also included installation of exterior features such as
large picture windows and porch lights, awnings, running
boards, and exterior showers.
    When Pleasure-Way imported the resulting mo-
torhomes into the United States, it sought to avoid their
being treated, for purposes of import duties, under the
facially applicable provision of the Harmonized Tariff
Schedule of the United States (HTSUS), namely, sub-
heading 8703.33.00. It requested a ruling from the Unit-
ed States Bureau of Customs and Border Protection that
the motorhomes should instead be classified under
HTSUS subheading 9802.00.50, which provides favorable
import-duty treatment to certain articles that, as relevant
here, meet the requirements set forth in 19 C.F.R.
§ 181.64 (2017) for favorable treatment of imported arti-
cles that qualify as “[g]oods re-entered after repair or
alteration in Canada or Mexico” (emphasis added). Cus-
PLEASURE-WAY INDUSTRIES, INC.    v. UNITED STATES        3



toms initially granted Pleasure-Way’s request, but it then
changed its position. Customs determined that the regu-
lation does not apply to the motorhomes that resulted
from Pleasure-Way’s conversion in Canada of the vans it
acquired in the United States. Customs therefore as-
sessed a 2.5% ad valorem import duty in accordance with
HTSUS subheading 8703.33.00.
    The parties agree that the only issue before us is the
applicability of the regulation. When Customs denied
Pleasure-Way’s protest, Pleasure-Way sued the United
States in the United States Court of International Trade
pursuant to 28 U.S.C. § 1581(a). The court held that the
regulation is inapplicable and on that basis granted
summary judgment against Pleasure-Way. Pleasure-Way
Indus., Inc. v. United States, 38 I.T.R.D. (BNA) 1889,
2016 WL 6081818, at *6 (Ct. Int’l Trade Oct. 18, 2016).
    Pleasure-Way appeals. We have jurisdiction under 28
U.S.C. § 1295(a)(5). Pleasure-Way agrees that “there are
no material facts in dispute as to the nature of the mer-
chandise.” Appellant’s Br. 10. We review the interpreta-
tion of the regulation and its application to the
undisputed facts on summary judgment de novo. Milleni-
um Lumber Distr. Ltd. v. United States, 558 F.3d 1326,
1328 (Fed. Cir. 2009); Lynteq, Inc. v. United States, 976
F.2d 693, 696 (Fed. Cir. 1992). We affirm.
                             I
   The first two subsections of the regulation at issue, 19
C.F.R. § 181.64, provide:
   § 181.64 Goods re-entered after repair or al-
   teration in Canada or Mexico.
     (a) General. This section sets forth the rules
   which apply for purposes of obtaining duty-free or
   reduced-duty treatment on goods returned after
   repair or alteration in Canada or Mexico as pro-
   vided for in subheadings 9802.00.40 and
4           PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



    9802.00.50, HTSUS. Goods returned after having
    been repaired or altered in Mexico, whether or not
    pursuant to a warranty, and goods returned after
    having been repaired or altered in Canada pursu-
    ant to a warranty, are eligible for duty-free treat-
    ment, provided that the requirements of this
    section are met. Goods returned after having been
    repaired or altered in Canada other than pursu-
    ant to a warranty are subject to duty upon the
    value of the repairs or alterations using the appli-
    cable duty rate under the United States-Canada
    Free-Trade Agreement (see § 10.301 of this chap-
    ter), provided that the requirements of this sec-
    tion are met. For purposes of this section, “repairs
    or alterations” means restoration, addition, reno-
    vation, redyeing, cleaning, resterilizing, or other
    treatment which does not destroy the essential
    characteristics of, or create a new or commercially
    different good from, the good exported from the
    United States.
      Example. Glass mugs produced in the United
    States are exported to Canada for etching and
    tempering operations, after which they are re-
    turned to the United States for sale. The foreign
    operations exceed the scope of an alteration be-
    cause they are manufacturing processes which
    create commercially different products with dis-
    tinct new characteristics.
      (b) Goods not eligible for duty-free or reduced-
    duty treatment after repair or alteration. The du-
    ty-free or reduced-duty treatment referred to in
    paragraph (a) of this section shall not apply to
    goods which, in their condition as exported from
    the United States to Canada or Mexico, are in-
    complete for their intended use and for which the
    processing operation performed in Canada or
PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES          5



   Mexico constitutes an operation that is performed
   as a matter of course in the preparation or manu-
   facture of finished goods.
     Example. Unflanged metal wheel rims are ex-
   ported to Canada for a flanging operation to
   strengthen them so as to conform to U.S. Army
   specifications for wheel rims; although the goods
   when exported from the United States are dedi-
   cated for use in the making of wheel rims, they
   cannot be used for that purpose until flanged. The
   flanging operation does not constitute a repair or
   alteration because that operation is necessary for
   the completion of the wheel rims.
19 C.F.R. § 181.64(a)–(b). Subsection (c) specifies re-
quirements of documentation and duty deposits upon
entry.
     The language and structure of this regulation make
clear several things of relevance here. Subsection (a)
establishes necessary requirements for eligibility for the
favorable duty treatment—either duty-free treatment or
imposition of duties only on the value of the foreign im-
provements (rather than the overall value of the imported
good). The provision makes the favorable treatment
depend on whether the foreign activities constitute “re-
pairs or alterations” as defined. Id. § 181.64(a) (“‘repairs
or alterations’ means . . .”). The definition itemizes exam-
ples (“restoration, addition, renovation, redyeing, clean-
ing, resterilizing, or other treatment”), id., and then
states two necessary requirements. One is that the
foreign activities “not . . . create a new or commercially
different good from[] the good exported from the United
States.” Id. The other is that the foreign activities “not
destroy the essential characteristics of . . . the good ex-
ported from the United States.” Id. These requirements
are stated separately, but they obviously are related.
6           PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



    The two necessary requirements must apply to all
items in the full phrase—“restoration, addition, . . . or
other treatment”—not just to the last phrase, “other
treatment.” Because the full phrase is an integrated
series of parallel terms, and the two requirements are
“applicable as much to the first and other words as to the
last,” Paroline v. United States, 134 S. Ct. 1710, 1721
(2014), this reading is “the natural construction,” id., and
also is supported by the general principle that “a ‘postpos-
itive modifier’—that is, one ‘positioned after’ multiple
phrases or clauses . . . —modifies all the preceding claus-
es, unless a ‘determiner’ is repeated earlier in the sen-
tence.” Disney Enters., Inc. v. VidAngel, Inc., 869 F.3d
848, 858 (9th Cir. 2017) (quoting Antonin Scalia & Bryan
Garner, Reading Law: The Interpretation of Legal Texts
148–49 (2012)). And the language at issue here compels
this reading for a particular reason: the presence of the
item “addition” in the list. That item is so broad that the
evident limiting function of the definition would be effec-
tively negated if any “addition” gained the favorable duty
treatment under subsection (a), even one that created a
new or commercially different good or destroyed the
essential characteristics of the good exported from the
United States. We note, too, that a predecessor version of
this regulation, quoted in Press Wireless, Inc. v. United
States, 6 Cust. Ct. 102, 104 (1941), made clear that the
language, “does not destroy the identity of the article
exported or create a new or different article,” applied to
the entirety of the covered “repairs.” 1 We have no reason


    1   Press Wireless quotes the Tariff Act of 1930, para.
1615, as providing that “articles exported from the United
States for repairs may be returned upon payment of a
duty upon the value of the repairs at the rate at which the
article itself would be subject if imported, under condi-
tions and regulations to be prescribed.” Press Wireless, 6
Cust. Ct. at 104. It then quotes a Customs regulation as
PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES           7



to think that Customs was changing the rule in this
critical respect through the rewording embodied in 19
C.F.R. § 181.64(a).
     Subsection (b) states an additional limitation on eligi-
bility for the favorable duty treatment authorized in
subsection (a). It declares certain “[g]oods not eligible for
duty-free or reduced-duty treatment after repair or alter-
ation.” 19 C.F.R. § 181.64(b) (subsection title). The goods
removed from eligibility, i.e., to which the favorable
treatment of subsection (a) “shall not apply,” are those
“which, in their condition as exported from the United
States to Canada or Mexico, are incomplete for their
intended use and for which the processing operation
performed in Canada or Mexico constitutes an operation
that is performed as a matter of course in the preparation
or manufacture of finished goods.” Id.
    This subsection focuses on the goods “in their condi-
tion as exported” (before the foreign processing) and on
whether they are “incomplete for their intended use” in
that condition and whether the foreign processing opera-
tion is “performed as a matter of course in the preparation
or manufacture of finished goods.” Id. The provision has
roots in United States v. J.D. Richardson Co., 36 CCPA 15
(1948), which involved the flange situation now given as
an example in subsection (b). The court in J.D. Richard-
son held that favorable treatment of alterations (under
regulatory language similar to what is now in 19 C.F.R.
§ 181.64(a)) was unavailable where a U.S. manufacturer


providing that “‘repairs’ as used in paragraph 1615 is
hereby defined to mean any change, renovation, cleaning,
redyeing, etc., which is necessary to restore an article to
its original condition after decay, injury, deterioration, or
partial destruction, when such change, renovation, etc.,
does not destroy the identity of the article exported or
create a new or different article.” Id.
8           PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



exported its “uncompleted articles,” which “could not be
used in their condition as exported,” to be “manufactured
into completed articles” that were then returned to the
U.S. manufacturer to be used as parts. J.D. Richardson,
36 CCPA at 16–17. The same basis for exclusion was also
relied on in Dolliff & Co. v. United States, 599 F.2d 1015,
1019 (CCPA 1979) (“[R]epairs and alterations are made to
completed articles and do not include intermediate pro-
cessing operations which are performed as a matter of
course in the preparation or the manufacture of finished
articles.”).
                             II
                             A
    The parties in this case have discussed three issues
bearing on possible exclusion from favorable duty treat-
ment under the regulation: (1) whether Pleasure-Way’s
conversion activities in Canada “create[d] a new or com-
mercially different good from” the exported vans;
(2) whether the conversion activities “destroy[ed] the
essential characteristics” of the exported vans; and (3)
whether the vans, “in their condition as exported from the
United States to Canada,” were “incomplete for their
intended use.” 19 C.F.R. § 181.64(a), (b). The Court of
International Trade resolved all three of those issues
against Pleasure-Way. Pleasure-Way, 2016 WL 6081818,
at *3–6. We think it preferable, and here it suffices, to
decide only the first issue—more precisely, whether
Pleasure-Way, in changing the vans into motorhomes,
created a commercially different good.
    That issue calls for a focus on relatively familiar con-
siderations concerning differentiation in the marketplace.
That differentiation may be reflected in various kinds of
evidence. Some kinds of evidence directly focus on what
happens in the marketplace—such as consumer uses and
how products are marketed and sold. Some kinds of
evidence are more indirect—such as legal treatment, as in
PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES            9



HTSUS, that is substantively related to commercial
differences.
     The other two inquiries discussed by the parties in
this case present greater challenges: at least in this case,
they are less tractable than the “commercially different
good” inquiry. The inquiry into “the essential characteris-
tics,” if taken on its own terms and not translated into a
marketplace inquiry, requires the assessment of different
characteristics of a vehicle for their essentiality. Here, for
example, the parties argue about the comparative essen-
tiality of the ability to move down the road and the vehi-
cle parts enabling that function versus the functions made
possible by those interior spaces not used for controlling
vehicle motion—spaces for carrying cargo from place to
place for use when off-loaded or, instead, for providing
comforts for use as a residence inside the vehicle. The
guides for resolving that debate to determine “the essen-
tial characteristics” in this context are not bright.
    The “intended use” inquiry presents its own challeng-
es—even aside from uncertainties in the regulatory text.
Whose intent counts? At what time? In this case, the
participants in the cycle may include a van manufacturer,
one or more van sellers in the U.S., one or more van
buyers in the U.S., the exporter from the U.S., one or
more buyers in Canada, the Canadian van alterer, the
importer of the altered vehicle, and the U.S. buyer of the
altered vehicle. The van maker at issue advertises the
vans to potential customers both as suitable for use as
sold (e.g., as a familiar cargo hauler) and as suitable for
modification for another use (e.g., as a motorhome). A
U.S. firm might buy a group of vans and export them with
the plan to sell some of them for use as is and others for
modification (and re-import), but not knowing which
possibility will ripen into reality for any particular van.
    We do not say that there exist no sound ways to meet
the challenges seemingly presented by the “intended use”
10          PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



inquiry, even in complicated situations. Certainly there
are simple situations, like the one involved in J.D. Rich-
ardson (quite unlike the present case), where, as already
noted, a U.S. manufacturer exported its “uncompleted
articles,” which “could not be used in their condition as
exported,” to be “manufactured into completed articles”
for return to the U.S. manufacturer to be used as parts.
36 CCPA at 16, 17 (emphasis added). But the apparent
challenges presented by the “intended use” language of
subsection (b) are on their face greater for a case like this
one—where the exported article is in fact a completed
article for consumer use for some purposes (traditional
cargo carrying)—than those presented by the “commer-
cially different” inquiry.
                             B
    In this case, the undisputed facts make the answer to
the “commercially different” question straightforward.
The Court of International Trade, in concluding that the
imported motorhomes were commercially different from
the exported Sprinter vans, relied on “changes to the
pricing, the applicable tariff heading, the use, and the
name of the vans.” Pleasure-Way, 2016 WL 6081818, at
*5. It determined that the motorhomes “no longer resem-
bled the exported cargo vans,” were “no longer classifiable
as motor vehicles for the transport of goods,” and were
sold at “different price points than the exported vehicles.”
Id. Those determinations were proper on this summary-
judgment record, and so was the conclusion that the
Pleasure-Way motorhomes were commercially different
from the Sprinter vans.
    Pleasure-Way gave the converted motorhomes new
names—the Ascent TS or Plateau TS. It sold them at a
price significantly higher than—even double or triple—
the market price for Sprinter vans. It marketed the
motorhomes as upscale leisure vehicles to be used for
vacationing and recreation, while the Sprinter vans were
PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES
                                                           11


marketed primarily as cargo vans, with the potential for
other uses if they were modified by purchasers. Overall,
then, the likely use and consumer base for the Sprinter
vans as exported were broadly different from those for the
motorhomes imported into the U.S. after leaving Pleas-
ure-Way’s Canadian conversion facility. Not surprisingly,
the applicable HTSUS tariff classifications are also differ-
ent for the motorhomes and the Sprinter vans—the mo-
torhomes come under subheading 8703 as vehicles
designed for the transport of persons, while the Sprinter
vans come under subheading 8704 as vehicles for the
transport of goods or cargo. These differences, taken in
combination, make the imported motorhomes commercial-
ly different goods from the exported Sprinter vans.
    Pleasure-Way argues against this conclusion by con-
tending that what constitutes a “commercially different
good” should depend on whether the altered good is
“identifiable” as the pre-alteration good and that a mo-
torhome is identifiable as the van from which it emerged
because the vehicle identification number (VIN) remains.
Appellant’s Br. at 43–47 (relying on Press Wireless). We
reject this view. It does not fit the regulation, and it is
not supported by Press Wireless.
    The regulation addresses a universe of situations in
which an exported good has been modified to become the
later imported good, and it distinguishes some such
modifications from others based (as relevant here) on
whether the resulting good is commercially different from
the original. If so, the favorable duty treatment is una-
vailable. The basis of distinction—whether the resulting
good is “commercially” different from the original—has
very little to do with whether it is possible to recognize
the original embedded in the altered good. And such
identifiability certainly is not a decisive fact, as Pleasure-
Way urges—even in the specific situation where there
happens to be an unrelated regulatory regime that ena-
12          PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



bles recognition of origins through assigned information-
encoding numbers, such as VINs.
     The conclusion that identifiability of the exported
good in the re-imported good does not equate to lack of
commercial difference is confirmed by the regulation’s
illustrative example—involving glass mugs tempered and
etched abroad that thereby became “commercially differ-
ent products with distinct new characteristics.” 19 C.F.R.
§ 181.64(a). There is no mention of whether or not the
exported mugs could be readily identified in the re-
imported products. The example focuses solely on wheth-
er the “distinct new characteristics” conferred by temper-
ing and etching changed the commercial nature of the
good, id., which depends on the commercial characteris-
tics of the original and resulting goods, not whether one is
still discernible in the other.
     Press Wireless, which involved radio tubes exported
for repairs and then reimported into the United States,
does not support Pleasure-Way’s position. The Customs
Court in Press Wireless did observe that, while the reim-
ported tubes had a new marking (“T.X. 10-3000”), the
original markings of the exported tubes (“S. W.7”) could
be discerned on the reimported tubes. 6 Cust. Ct. at 104.
But the Customs Court hardly stopped at that fact, which
merely rebutted the Government’s contention that the
imported tubes were not the same tubes as the exported
ones. The court held that the tubes qualified for favorable
duty treatment under the precursor to current subsection
(a) because of the limited nature of the foreign processing:
“[w]hile abroad the worn-out tubes were restored to a
condition which prolonged the use for which they were
originally designed,” no more, except for some greater
efficiency from an improved material for the filament. Id.
at 105. For the reasons indicated, the change at issue in
the present case is quite different as a commercial matter.
PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES
                                                         13


     Pleasure-Way further suggests that this court’s pre-
decessor, in the Dolliff case, held that changes in name,
price, and classification may not be taken into account
when determining whether an imported good is commer-
cially different from its exported precursor. We reject
that suggestion. It overstates what Dolliff stands for.
     As relevant to Pleasure-Way’s point, the furthest Dol-
liff goes is one statement that some changes in the “name,
appearance, size, shape and use” of a good could be “alter-
ations” within the meaning of a regulation similar to 19
C.F.R. § 181.64(a). Dolliff, 599 F.2d at 1018. 2 That
statement hardly precludes reliance on the totality of
circumstances relevant to commercial differences, includ-
ing those mentioned in Dolliff. Moreover, even the lim-
ited statement in Dolliff was unnecessary to the court’s
holding there, which was that the changes at issue were
not “alterations.” Id. at 1021. And the court drew that
conclusion, as we have noted, on the ground now embod-
ied in 19 C.F.R. § 181.64(b), based on J.D. Richardson:
the foreign processing at issue in Dolliff, the court held,



   2     Dolliff quotes a regulation, which defined “repairs
or alterations” in Tariff Schedules of the United States
(TSUS) item 806.20, as follows: “The term ‘repairs or
alterations’ shall be held to mean restoration, change,
addition, renovation, cleaning, or other treatment which
does not destroy the identity of the article exported or
create a new or different article.” See 599 F.2d at 1018.
The court in Dolliff then said the following about TSUS
item 806.20: “Appellant correctly contends that simply
because intermediate foreign processing of articles of U.S.
origin that are subsequently reimported into the United
States results in differences in name, value, appearance,
size, shape and use for the articles does not require a
conclusion that the foreign processing does not comprise
‘alterations’ under TSUS item 806.20.” Id.
14           PLEASURE-WAY INDUSTRIES, INC.   v. UNITED STATES



was processing “performed on unfinished goods” and led
“to completed articles,” so “the processing cannot be
considered alterations.” Id. at 1019. The actual decision
in Dolliff, rejecting the “alteration” characterization, could
not aid Pleasure-Way even if it applied to the exported
Sprinter vans.
    We conclude that Pleasure-Way’s motorhomes flunk a
necessary requirement for favorable duty treatment
under 19 C.F.R. § 181.64 and, therefore, are not properly
classifiable under subheading 9802.00.50 of the HTSUS.
                             III
    For the foregoing reasons, we affirm the judgment of
the Court of International Trade.
                        AFFIRMED
