Medical Foods for Children Are Medicaments for the Handicapped, Importer Says
Specialty medical foods designed for infants and toddlers should be classified as medicaments and also enter duty-free under special Chapter 98 tariff provisions for articles for the handicapped, Nutricia North America said in an Aug. 31 motion at the Court of International Trade. Nutricia has asked the court to order CBP to classify the products under Harmonized Tariff Schedule of the U.S. subheading 3004.50.5040, with a secondary classification under HTSUS subheading 9817.00.96, to reliquidate the subject entries, and to issue refunds plus interest to Nutricia (Nutricia North America v. U.S., CIT #16-00008).
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The motion is the second time this year Nutricia has moved for summary judgment. The company argued in January that the products are both designed and prescribed for therapeutic use and specifically not for general use as food. "[H]ealthy children do not consume them (in some cases such consumption would be dangerous)," Nutricia said in its brief. The products have been the subject of "hundreds of use and efficacy studies written by and for medical experts" and Nutricia has provided the government with over 200 of these studies, it said. Nutricia argued that CBP wanted to unlawfully narrow the scope of heading 3004 by adding requirements that medicaments "must feature an active ingredient and cure a disease," which is not required for classification in heading 3004.
On the secondary heading 9817.00.96, Nutricia argued that patients suffering from these diseases were "'handicapped," and noted that the Americans with Disabilities Act contains a nearly identical definition of "handicapped" to the one in the tariff schedule. Nutricia argued that CBP’s only response was that patients with conditions treated by the products have conditions that "impair the physical act of eating” (see 2201270019).
That motion was based in part on the medical opinion of Nutricia's former expert, Dr. Joel Lavine. During the trial, and unbeknownst to the parties, Lavine was convicted of abusing a former patient. After Lavine's Feb. 22 sentencing, DOJ made Nutricia aware of Lavine's conviction, and agreed to allow Nutricia to find a new medical expert witness for the case. Nutricia moved to reopen the record with new witness Dr. Jonah Essers and asked the court to allow it to withdraw its earlier motion for summary judgment, which Judge Timothy Stanceu granted in May (see 2204220046).
Both Nutricia and the government agreed that the case had been tainted by the criminality of the previous expert witness. Essers was allowed to testify on the same five topics that Lavine had addressed, which led to Nutricia submitting another, similar motion for judgment. The government's preferred classification is heading 2106, which is limited to food preparations “not elsewhere specified,” Nutricia said. In order for CBP to prevail, it must demonstrate that the subject products are not medicaments, which it cannot do, Nutricia argued. The products at issue "were conceived, designed, produced, marketed, and sold for therapeutic or prophylactic use to treat persons with medical problems, which is the defining characteristic of a medicament," and are indicated for use in treatment of a variety of diseases, Nutricia said.
On the secondary classification issue, Nutricia argued that patients using the products have a "physical ailment that substantially limits one or more major life activities" as required by the Notes governing heading 9817. Its products are specifically designed for patients who cannot metabolize any naturally occurring protein without suffering adverse effects, thus meeting the qualification of "handicapped," Nutricia said.