Totes-Isotoner Corp. v. United Stat

SLIP OP. 08-73

UNITED STATES COURT OF INTERNATIONAL TRADE

BEFORE: THE HONORABLE JANE A. RESTANI, CHIEF JUDGE

THE HONORABLE DONALD C. POGUE, JUDGE

THE HONORABLE JUDITH M. BARZILAY, JUDGE

------------------------------x

TOTES-ISOTONER CORPORATION, :

:

Plaintiff, :

:

v. : Court No. 07-00001

:

:

UNITED STATES :

:

Defendant. :

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OPINION

[Defendant’s motion to dismiss for lack of jurisdiction denied;

Defendant’s motion to dismiss for failure to state a claim

granted.]

Dated: July 3, 2008

Neville Peterson, LLP (John M. Peterson, Curtis W. Knauss, Matthew

G. Shaw, and Michael T. Cone)for the Plaintiff.

Gregory G. Katsas, Acting Assistant Attorney General; Jeanne E.

Davidson, Director, Patricia M. McCarthy, Assistant Director,

Commercial Litigation Branch, Civil Division, U.S. Department of

Justice (Reginald T. Blades, Jr.); Aimee Lee and Gardner B. Miller,

Attorneys, International Trade Field Office, U.S. Department of

Justice for Defendant United States.

Pogue, Judge: In this action, Plaintiff, Totes-Isotoner

Corporation (“Totes”), a U.S. importer of men’s gloves, challenges

the constitutionality of the tariff rate imposed on its imports.

Totes claims that by setting out different tariff rates for certain

“Men’s” gloves and other gloves, the Tariff Schedule violates

Totes’ right to equal protection under the law because it

discriminates on the basis of gender and/or age.

Court No. 07-00001 Page 2

The Defendant United States asks the Court to dismiss Totes’

complaint, claiming that the Court does not have jurisdiction over

this matter for two reasons: (1)the Complaint presents a non-

justiciable political question; and (2)the Plaintiff does not have

a sufficient stake in the matter so as to possess standing to bring

this equal protection claim. USCIT Rule 12(b)(1). In the

alternative, the government also seeks dismissal under USCIT Rule

12(b)(5), asserting that Totes’ pleadings fail to state a claim

upon which relief can be granted.

Because the Court concludes that Totes’ equal protection

claims properly invoke the Court’s traditional role of-–and

standards for-–constitutional review, and that Totes has standing

to bring its claims, the Court denies Defendant’s motion to dismiss

for lack of jurisdiction. However, because Plaintiff’s Complaint

does not plead sufficient facts to state a claim of

unconstitutional discrimination, the Court dismisses this matter,

without prejudice, pursuant to Rule 12(b)(5).

The Court exercises jurisdiction, pursuant to 28 U.S.C.

§ 1581(i)(1), which grants to the court exclusive jurisdiction over

actions arising out of a law of the United States which provides

for “revenue from imports.”

Discussion

The Court will discuss, in turn, each of the stated bases for

the government’s motion to dismiss: 1. The Political Question

Doctrine; 2. The Alleged Lack of Constitutional and Prudential

Standing; and 3. Totes’ Failure to State a Claim.

I. The Political Question Doctrine

In its Complaint, which the government would have us dismiss,

Court No. 07-00001 Page 3

Totes pleads that the government classifies “Men’s” leather gloves

in subheading 4203.2930, of the Harmonized Tariff Schedule of the

United States (“HTSUS”),1 at a duty rate of 14 percent ad valorem,

whereas gloves “[f]or other persons” are classified under

2

subheading 4203.2940, HTSUS, at the lower duty rate of 12.6

percent ad valorem.3 Totes alleges that these provisions of the

HTSUS “discriminate on the basis of gender or age,” Complaint at 1,

in violation of the Constitution’s Equal Protection guarantee. U.S.

CONST. amend. XIV, § 1, cl. 2(“[N]o State shall . . . deny to any

person within its jurisdiction the equal protection of the

4

laws.”). Accordingly, the Complaint challenges the extent to

1

4203.2930, HTSUS includes subheadings for both lined and

unlined gloves. 4203.29.3010, HTSUS includes “Articles of

apparel and clothing accessories, of leather or of composition

leather: Gloves, mittens and mitts: Other: Other: Other: Men’s

. . . Not lined.” 4203.29.3020, HTSUS includes “Articles of

apparel and clothing accessories, of leather or of composition

leather: Gloves, mittens and mitts: Other: Other: Other: Men’s

. . . Lined.”

2

4203.2950, HTSUS includes “Articles of apparel and clothing

accessories, of leather or of composition leather: Gloves,

mittens and mitts: Other: Other: Other: For other persons . . .

Lined.”

3

For purposes of the Court’s standing determination, the

government does not contest the factual allegations in Totes’

Complaint.

4

Although Totes bases its claim on an alleged violation of

the Fifth Amendment, which provides that no person shall be

deprived of life, liberty, or property, without due process of

law, the analysis is the same as that for claims brought under

the equal protection clause of the Fourteenth Amendment. Bolling

v. Sharpe, 347 U.S. 497, 500 (1954) (“In view of our decision

that the Constitution prohibits the states from maintaining

racially segregated public schools, it would be unthinkable that

the same Constitution would impose a lesser duty on the Federal

Government. We hold that racial segregation in the public

schools of the District of Columbia is a denial of the due

(continued...)

Court No. 07-00001 Page 4

which the government may use gender in the classification of goods

for importation.

Nonetheless, the government argues that this Complaint raises

a non-justiciable political question. As noted above, however, in

the Court’s view, the Complaint seeks review of specific statutory

provisions using traditional constitutional equal protection

standards that have long been interpreted and applied by the

judicial branch. As such, Totes’ claim does not intrude into the

non-judicial domain.

The political question doctrine, recognizing our

constitutional separation of powers principle, does exclude some

disputes from judicial determination. Under this doctrine, a

subject matter is not appropriate for judicial resolution where it

is exclusively assigned to the political branches or where such

branches are better-suited than the judicial branch to determine

the matter. See Baker v. Carr, 369 U.S. 186, 211 (1962);5 Japan

4

(...continued)

process of law guaranteed by the Fifth Amendment to the

Constitution.” (footnote omitted)); Washington v. Davis, 426 U.S.

229, 239 (1976)(“[T]he Due Process Clause of the Fifth Amendment

contains an equal protection component prohibiting the United

States from invidiously discriminating between individuals or

groups.” (citation omitted)). Therefore, the Court applies cases

relating to the two amendments in its analysis.

5

Baker identified six characteristics of cases found

inappropriate for judicial consideration under the political

question doctrine.

Prominent on the surface of any case held to involve a

political question is found [1] a textually

demonstrable constitutional commitment of the issue to

a coordinate political department; or [2] a lack of

judicially discoverable and manageable standards for

resolving it; or [3] the impossibility of deciding

without an initial policy determination of a kind

clearly for nonjudicial discretion; or [4] the

impossibility of a court's undertaking independent

resolution without expressing lack of the respect due

(continued...)

Court No. 07-00001 Page 5

Whaling Ass’n v. Am. Cetacean Soc’y, 478 U.S. 221, 230 (1986) (“The

political question doctrine excludes from judicial review those

controversies which revolve around policy choices and value

determinations constitutionally committed for resolution to the

halls of Congress or the confines of the Executive Branch. The

Judiciary is particularly ill suited to make such decisions, as

‘courts are fundamentally underequipped to formulate national

policies or develop standards for matters not legal in nature.’”

(quoting United States ex rel. Joseph v. Cannon, 642 F.2d 1373,

1379 (1981)(footnote omitted), cert. denied, 455 U.S. 999 (1982))).

Invoking this doctrine, the government asserts that the

subject matter of Plaintiff’s Complaint–-the use of gender in

tariff classifications--is not appropriate for judicial resolution

because it involves issues of trade policy reserved to the

political branches. Specifically, the government argues that the

formation and adoption of the tariff provisions at issue here

involve the negotiation of agreements with foreign governments and

that Plaintiff’s claim challenges the substance of those

international trade agreements. The government argues that there

are no judicially manageable standards for reviewing the results of

these international trade agreements. To the government, “[w]hether

the rates provided in the Harmonized Tariff Schedule should be

equalized with regard to products classified based upon gender or

age related characteristics is a political question that the Court

should decline to adjudicate.” Def.’s Mot. to Dismiss, at 14.

Plaintiff properly replies that the specific provisions of the

5

(...continued)

coordinate branches of government; or [5] an unusual

need for unquestioning adherence to a political

decision already made; or [6] the potentiality of

embarrassment from multifarious pronouncements by

various departments on one question.

Baker, 369 U.S. at 217. The government relies primarily on the

first two characteristics.

Court No. 07-00001 Page 6

HTSUS constitute statutes enacted by Congress pursuant to Section

1204(c) of the Omnibus Trade and Competitiveness Act of 1988.6 19

U.S.C. § 3004(c). Citing this statutory structure, Plaintiff

reasons that its Complaint is a garden-variety equal protection

claim challenging the statute imposing tariffs and in no way

implicates the negotiation of international agreements that may

precede statutory enactment. Rather than intrude in areas

delegated to the executive or legislative branch, Plaintiff claims

that its Complaint invokes traditional constitutional equal

protection standards readily subject to judicial administration.

In support of its argument, Plaintiff invokes the Supreme

Court’s analysis in Japan Whaling, which explains that:

[N]ot every matter touching on politics is a political

question . . . and more specifically, that it is “error

to suppose that every case or controversy which touches

foreign relations lies beyond judicial cognizance.” . . .

As Baker plainly held, [] the courts have the

authority to construe treaties and executive agreements,

and it goes without saying that interpreting

congressional legislation is a recurring and accepted

task for the federal courts. . . . We are cognizant of

the interplay between these Amendments and the conduct of

this Nation's foreign relations, and we recognize the

premier role which both Congress and the Executive play

in this field. But under the Constitution, one of the

Judiciary's characteristic roles is to interpret

statutes, and we cannot shirk this responsibility merely

because our decision may have significant political

overtones.

Japan Whaling, 478 U.S. at 229-30 (quoting Baker, 369 U.S. at 211).7

6

Further citations to the 1988 Act are to relevant

provisions in Title 19 of the U.S. Code, 2000 edition.

7

For a more extensive discussion of Japan Whaling’s holding

with regard to the political question doctrine, see Canadian

Lumber Trade Alliance v. United States, 425 F. Supp. 2d 1321,

1355-56 (2006).

Court No. 07-00001 Page 7

The Supreme Court’s admonition in Japan Whaling is directly

applicable here. In the case before us, even if the challenged

statutory provisions originated in international negotiations,

those provisions have since been enacted into law as the HTSUS.

Thus, this Complaint does not challenge the actions of the

President or Congress in their respective spheres of responsibility

for foreign commerce or foreign relations. Rather, it involves

constitutional review of a domestic statute. It has long been the

role of the court to adjudicate legislative classifications in view

of the importance of the governmental interests involved. See

United States v. Carolene Products Co., 304 U.S. 144, 153

(1938)(“Where the existence of a rational basis for legislation

whose constitutionality is attacked depends upon facts beyond the

sphere of judicial notice, such facts may properly be made the

subject of judicial inquiry, . . . and the constitutionality of a

statute predicated upon the existence of a particular state of

facts may be challenged by showing to the court that those facts

have ceased to exist.”(citations omitted)). In the light of this

history and precedent, it is clear that review of statutory

provisions, using constitutional standards, is manifestly within

the judicial realm. Such review is, if anything, more appropriate

here than in Japan Whaling, which involved evaluation of the

Japanese whaling industry, a matter even more removed from the

domestic realm than that at issue here.

Thus, Totes’ challenge to the discriminatory operation of the

HTSUS properly invokes the Court’s traditional role of-–and

standards for-–constitutional review. Therefore, the Court denies

the government’s request that Totes’ Complaint be dismissed under

the political question doctrine.8

8

Although the government also argues that Totes’ Complaint

should be viewed as raising a political question because the

(continued...)

Court No. 07-00001 Page 8

II. Standing

A. Constitutional Standing

Because federal judicial jurisdiction arises from the

Constitution, in order to bring its case here, Totes must

demonstrate that its claim qualifies as a “case” or “controversy”

for purposes of Article III of the Constitution, and specifically

that it has a sufficient stake in the matter to establish its

“standing” to bring its claim. Canadian Lumber Trade Alliance v.

United States, 517 F.3d 1319, 1331 (Fed. Cir. 2008)(“There is no

case or controversy within the meaning of the Constitution unless

the plaintiff has standing.”).

To establish a sufficient stake for purposes of Article III

standing, plaintiffs must demonstrate: (1)that they have suffered

some injury-in-fact; (2)that there is a causal connection between

the defendant’s conduct and this injury-in-fact; and (3) that this

injury is redressable by the court. Lujan v. Defenders of Wildlife,

504 U.S. 555, 560-61 (1992)(“Defenders of Wildlife”)(citations

omitted).9

8

(...continued)

relief Totes’ seeks would raise the “potential for embarrassment

from multifarious pronouncements and [contrary to the] need for

adherence to [a] political decision,” the judiciary’s application

of the constitutional parameters for gender and age

discrimination to tariff classifications should produce no more

than one clear determination. Nor would the remedy Totes seeks

require the government to raise duties on gloves for other

persons in violation of any international trade agreement; just

the contrary. Totes seeks a reduction not an increase in the

allegedly discriminatory rates. Accordingly, this litigation

does not raise the alternative concern advanced by the

government.

9

Because Totes claims a violation of the Constitution’s

Equal Protection guarantee, we need not be diverted by the

government’s citation of the absence of a substantive Due Process

(continued...)

Court No. 07-00001 Page 9

We consider, in order, each prong of the Defenders of Wildlife

test. First, as noted above, Totes’ Complaint alleges that the

government has assessed and Totes has paid customs duties at the 14

percent rate. Complaint at 2. Thus, Totes alleges that it has

suffered an injury in fact-–the loss of money. Second, Totes also

alleges that this injury is a result of–-or caused by--the

government’s allegedly discriminatory tariff rates. Finally, to

the extent this rate is unconstitutionally discriminatory, Totes

seeks restoration, with interest, of any excess duty paid.

Complaint at 7. Thus, Totes seeks redress in the form of a return

of the excess tariffs imposed. Grant of this redress is manifestly

within the historic power of this Court, see, e.g., United States

v. U.S. Shoe Corp., 523 U.S. 360, 365-66 (1998)(affirming the CIT’s

conclusion that the Harbor Maintenance Tax is unconstitutional and

that duties collected pursuant to the tax must be refunded), and is

the requested and likely outcome of this action were Totes to

prevail. See Litecubes, LLC v. Northern Light Products, Inc., 523

F.3d 1353, 1360 (Fed. Cir. 2008)(“Subject matter jurisdiction does

not fail simply because the plaintiff might be unable to ultimately

9

(...continued)

right of importation, see Arjay Associates, Inc. v. Bush, 891

F.2d 894, 896 (Fed. Cir. 1989)(“[N]o one has a constitutional

right to conduct foreign commerce in products excluded by

Congress”), as compared to recognition of a procedural Due

Process right. See NEC Corp. v. United States, 151 F.3d 1361,

1370-71 (Fed. Cir. 1998). “[E]ven though a person has no ‘right’

to a valuable governmental benefit,” the government “may not deny

a benefit to a person on a basis that infringes his

constitutionally protected interests.” Perry v. Sindermann, 408

U.S. 593, 597 (1972). Because Totes has alleged that the

challenged tariff rates infringe upon its interests by

unconstitutionally discriminating on the basis of gender, the

government’s assertion that Totes has no vested right to import

is irrelevant to the analysis of Totes’ standing and to the

claims upon which that standing is based.

Court No. 07-00001 Page 10

succeed on the merits.” (citation omitted)). Accordingly, Totes’

allegations provide a sufficient basis to establish Totes’

constitutional standing to bring its claim.

Despite the fact that Totes has paid the allegedly

discriminatory tariff rates, the government argues that Totes’

injury is too indirect to permit standing here. To the government,

because the tax imposed by the tariff provision must be paid by all

importers of men’s leather gloves, Totes pays the same tariff as

other similarly situated importers, and is therefore not subject to

discriminatory treatment. But there is no obligation requiring a

plaintiff challenging an allegedly express suspect governmental

classification to plead and prove the existence of a similarly-

situated non-protected class. Brown v. City of Oneonta, 221 F.3d

329, 337 (2d Cir. 2000)(“Plaintiffs are correct, however, that it

is not necessary to plead the existence of a similarly situated

non-minority group when challenging a law or policy that contains

an express, racial classification.”), overruled in part on other

grounds by Gonzaga Univ. v. Doe, 536 U.S. 273 (2002).

The government also argues that the tariff rates challenged

here tax products, not people, and that therefore Totes is not

itself the object of any prohibited discrimination. This issue,

however, was addressed in Craig v. Boren, where a beer vendor was

allowed by the Supreme Court to pursue the equal protection claims

of 18-21 year old males against the relevant statute which

permitted beer purchases by 18-21 year old females. Craig v.

Boren, 429 U.S. 190, 194-7 (1976). “[W]here a person is

effectively used by the government to implement a discriminatory

scheme,” he may invoke the rights of the infringed to challenge

that scheme. Fraternal Order of Police v. United States, 152 F.3d

998, 1002 (D.C. Cir. 1998). If anything, Totes’ role as payor of

the allegedly discriminatory tax makes its standing here more

directly connected to that scheme than the interest of the beer

Court No. 07-00001 Page 11

vendor found sufficient in Craig.10

B. Prudential Standing

In addition to challenging Totes’ constitutional standing to

bring this case, the government also argues that Totes lacks

standing for “prudential” reasons. See Clarke v. Sec. Indus. Ass'n,

479 U.S. 388, 396 (1986)(“‘[T]he interest sought to be protected by

the complainant [must be] arguably within the zone of interests to

be protected or regulated by the statute or constitutional guarantee

in question.’” (quoting Ass’n of Data Processing Serv. Org., Inc.

v. Camp, 397 U.S. 150, 153 (1970))). This “zone of interest”

requirement “denies a right of review if the plaintiff’s interests

are [] marginally related to or inconsistent with the purposes

implicit” in the constitutional guarantee invoked. Clarke, 479 U.S.

at 399.

The Supreme Court has further maintained that the “zone of

interest” test operates under the presumption that agency actions

are subject to judicial review, and therefore, the test “is not

meant to be especially demanding; in particular, there need be no

10

Although Totes’ claim that the Constitution “prohibits the

defendant from discriminating in the assessment of taxes or

duties on the basis of gender or age,” (Complaint at 5), could

give rise to further analysis of Totes’ possible third-party

standing on behalf of adult male purchasers of gloves, Totes

expressly indicated at oral argument that it does not seek

derivative or third-party standing such as that recognized by

Craig or Powers v. Ohio, 499 U.S. 400 (1991). It is therefore

unnecessary to determine whether Totes’ allegations would

indicate that “enforcement of the challenged [provision] . . .

would result indirectly in the violation of third parties’

rights.” Craig, 429 U.S. at 195 (quoting Warth v. Seldin, 422

U.S. 490, 510 (1975)); see also Craig, 429 U.S. at 196

("[C]rucial to the decision to permit jus tertii standing [is]

the recognition of ‘the impact of the litigation on the third-

party interests.’” (quoting Eisenstadt v. Baird, 405 U.S. 438,

445 (1972))).

Court No. 07-00001 Page 12

indication of congressional purpose to benefit the would-be

plaintiff.” Clarke, 479 U.S. at 399-400 (citation and footnote

omitted); see also Nat’l Credit Union Admin. v. First Nat’l Bank &

Trust Co., 522 U.S. 479, 488-9 (1998)(“Although our prior cases have

not stated a clear rule for determining when a plaintiff's interest

is ‘arguably within the zone of interests’ to be protected by a

statute, they nonetheless establish that we should not inquire

whether there has been a congressional intent to benefit the would-

be plaintiff.”). Rather, the zone of interest test only “denies a

right of review if the plaintiff's interests are [] marginally

related to or inconsistent with the purposes implicit in the statute

. . . .” Clarke, 479 U.S. at 399; see also Kemet Elecs. Corp. v.

Barshefsky, 21 CIT 912, 927-28, 976 F. Supp. 1012, 1026

(1997)(citing Clarke).

The constitutional equal protection guarantee at issue in this

case clearly protects against discrimination on the basis of sex.

Craig v. Boren, 429 U.S. at 197. Because Totes alleges that its

injury is the direct result of prohibited discrimination, which is

both facial and express, Totes’ claim is not “marginally related to

or inconsistent with the purposes” of the equal protection clause.

Accordingly, because Totes’ claim, as alleged, is within the

zone of interests protected by the Constitution’s Equal Protection

guarantee, there is no prudential reason to deny Totes standing to

litigate its claim.

III. Failure to State a Claim

We turn now to the adequacy of Totes’ factual pleadings,

explaining why Totes’ Complaint, as presently drafted, fails to

“show” the necessary entitlement to relief.

As noted above, Totes’ Complaint alleges a prohibited

governmental classification “based on sex.” The applicable pleading

Court No. 07-00001 Page 13

requirements, however, as set out in Fed. R. Civ. P. 8(a), and

recently explained by the Supreme Court in Bell Atl. Corp. v.

Twombly,___ U.S. ___, 127 S. Ct. 1955, 1964 (2007)(“Bell Atlantic”),

mandate “more than labels and conclusions, and a formulaic

recitation of the elements of a cause of action will not do.” Bell

Atlantic, 127 S. Ct. at 1964-65 (citation omitted). While it is not

necessary for a plaintiff to provide detailed factual allegations,

the factual allegations asserted must still be “enough to raise a

right to relief above the speculative level . . . on the assumption

that all the allegations in the complaint are true (even if doubtful

in fact).” Id. at 1965 (citation omitted).11 In so doing, a

plaintiff must still provide “‘a short and plain statement of the

claim showing that the pleader is entitled to relief,’ in order to

give the defendant fair notice of what the . . . claim is and the

grounds upon which it rests.” Id. at 1964 (citing Conley v. Gibson,

355 U.S. 41, 47 (1957)).12

While the contours of this requirement have not yet been

broadly addressed by the Federal Circuit, other circuits have

considered the issue. The Second Circuit, for example, has

interpreted Bell Atlantic as “requiring a flexible ‘plausibility

standard,’ which obliges a pleader to amplify a claim with some

allegations in those contexts where such amplification is needed to

render the claim plausible.” Iqbal v. Hasty, 490 F.3d 143, 157-58

11

In Bell Atlantic, the Court disavowed the oft-cited

standard set forth in Conley v. Gibson, 355 U.S. 41, 45-46

(1957), that “a complaint should not be dismissed for failure to

state a claim unless it appears beyond doubt that the plaintiff

can prove no set of facts in support of his claim which would

entitle him to relief.” Bell Atlantic, supra, 127 S. Ct. at 1959-

60.

12

The Federal Circuit has indicated that Bell Atlantic does

not alter notice pleading as a requirement or practice. McZeal v.

Sprint Nextel Corp., 501 F.3d 1354, 1357-8 (Fed. Cir.

2007)(discussing the “low bar” for pro se plaintiffs).

Court No. 07-00001 Page 14

(2d Cir. 2007)(emphasis omitted). As the Third Circuit has

explained, “there must be some showing sufficient to justify moving

the case beyond the pleadings to the next stage of litigation.”

Phillips v. County of Allegheny, 515 F.3d 224, 234-5 (3d Cir. 2008).

Here, we must apply Bell Atlantic’s pleading requirement to

Totes’ equal protection claim. In order to state such a claim for

violation of the equal protection clause based on gender, Totes must

allege that the government has engaged in gender-based

discrimination without an exceedingly persuasive justification, or

in other words, that the government has used discriminatory means

that are not substantially related to important governmental

objectives. United States v. Virginia, 518 U.S. 515, 532-33 (1996);

Craig v. Boren, 429 U.S. at 197 (1971)(“To withstand constitutional

challenge . . . classifications by gender must serve important

governmental objectives and must be substantially related to

13

achievement of those objectives.”). In so doing, Totes’ complaint

must include a factual allegation that demonstrates a governmental

purpose to discriminate. Washington v. Davis, 426 U.S. 229, 242

(1976)(noting that “an invidious discriminatory purpose may often

be inferred from the totality of the relevant facts . . .”).

Whether the prohibited discrimination is overt or covert, Personnel

Adm’r of Mass. v. Feeney, 442 U.S. 256, 273 (1979), Totes’ Complaint

must allege facts sufficient to “show” some purpose or intent to

disfavor individuals because of their sex, though such purpose or

intent need not be malicious. Bray v. Alexandria Women’s Health

Clinic, 506 U.S. 263, 270-1 (1993). In Bray, the Court stated:

13

Because the pleading requirements for invidious

discrimination based on age are not less than for such

discrimination based on sex, Kimel v. Fla. Bd. of Regents, 528

U.S. 62, 83 (2000)(“States may discriminate on the basis of age

without offending the Fourteenth Amendment if the age

classification in question is rationally related to a legitimate

state interest.”), we need not discuss them separately.

Court No. 07-00001 Page 15

We do not think that the “animus” requirement can be met

only by maliciously motivated, as opposed to assertedly

benign (though objectively invidious), discrimination

against women. It does demand, however, at least a

purpose that focuses upon women by reason of their sex-

for example (to use an illustration of assertedly benign

discrimination), the purpose of “saving” women because

they are women from a combative, aggressive profession

such as the practice of law. . . .

. . . Some activities may be such an irrational

object of disfavor that, if they are targeted, and if

they also happen to be engaged in exclusively or

predominantly by a particular class of people, an intent

to disfavor that class can readily be presumed. A tax on

wearing yarmulkes is a tax on Jews.

Id. at 269-70 (emphasis omitted).

A facial or express gender-based classification may, of course,

indicate a discriminatory purpose, see, e.g., Cmtys. for Equity v.

Mich. High Sch. Athletic Ass’n, 459 F.3d 676, 694 (6th Cir.

2006)(“Disparate treatment based upon facially gender-based

classifications evidences an intent to treat the two groups

differently”), and Totes’ Complaint does allege the express use of

gender in the tariff classification scheme. The Complaint, however,

does not allege discrimination “based on” gender, i.e., that the

duty or tax imposed by the tariff classification, or any burden

resulting from that tax, is imposed because of or based on gender

or otherwise disfavors individuals because of their gender. Thus,

the Complaint does not allege sufficient facts to establish that the

government has engaged in gender-based discrimination. This is

because the tariff provisions that Totes challenges are not “actual

use” provisions, i.e., the tariff provisions at issue do not require

that the imported goods be actually sold to or used by people of one

sex or of some age category.14

14

Rather, the challenged classifications indicate “chief”

or “principal” use, and it is well established that where

(continued...)

Court No. 07-00001 Page 16

To classify imports as men’s gloves, or gloves “for other

persons” does not establish that they will be bought by or used by

men, or that men will necessarily pay the allegedly discriminatory

tax. “For” is used to indicate objective. Thus the mere allegation

that the HTSUS classifies or labels goods as imported “for” persons

of one sex does not establish that those classifications are “on the

basis of” or “by” gender. “On the basis of” indicates foundation

or fundamental element rather than objective. As the Supreme Court

explained in Allegheny Pittsburgh Coal Co. v. County Comm’n of

Webster Country, W. Va., 488 U.S. 336, 343 (1989), “[t]he Equal

Protection Clause applies only to taxation which in fact bears

unequally on persons or property of the same class.” (internal

quotations omitted)(emphasis added).15

According to Totes’ Complaint, by distinguishing between men’s

gloves and gloves for women, the HTSUS distinguishes between

property of the same class (leather gloves), and this discrimination

is made on the basis of the gender and/or age of the intended user.

Pl.’s Resp. to Def.’s Mot. to Dismiss 38 (“Pl.’s Br.”). But the

facts alleged–-merely “distinguishing” between gloves for men and

gloves for other persons–-are not sufficient to show discrimination

14

(...continued)

classification is proper under the doctrine of chief (now

principal) use, there must be proof of such use. Advance

Solvents & Chemical Corp. v. United States, 34 CCPA 148, 151

(1947).

15

Allegheny Pittsburgh Coal involved the implementation of

state law, and the different methods used to assess property

values for recently-purchased properties as opposed to property

held for a longer time. Recognizing that a State “may divide

different kinds of property into classes and assign to each class

a different tax burden,” the Court applied a low level of

scrutiny, explaining that the state’s ability to assign these

different tax burdens existed “so long as those divisions and

burdens are reasonable.” Allegheny Pittsburgh Coal, 488 U.S. at

344 (citing Allied Stores of Ohio v. Bowers, 358 U.S. 522, 526-27

(1959)(“Bowers”)).

Court No. 07-00001 Page 17

“on the basis of” sex.16 Moreover, the discrimination alleged in

Totes’s Complaint, results from the imposition of the duty, or tax,

imposed by the tariff classifications. Complaint at 6. But, as

alleged in the Complaint, that duty or tax falls on importers, and

there is no factual indication in the Complaint that the

classification results in a discriminatory application of the tax.17

Therefore, Totes’ additional allegation of discrimination “on the

basis of sex” is simply conclusory, in violation of the Bell

Atlantic requirement. See also Judge v. City of Lowell, 160 F.3d

67, 75 (1st Cir. 1998) (requiring “specific, nonconclusory factual

allegations giving rise to a reasonable inference of racially

discriminatory intent”). After Bell Atlantic, it appears that the

Plaintiff is required to allege facts that could provide a showing

that Totes is entitled to relief.

To be clear, were this a facially discriminatory tax,

Plaintiff’s pleadings could be sufficient; in addition, we do not

ignore the fact that the tariff schedule makes an express reference

to gender. Nor do we assume that this express reference is

necessarily benign. Nonetheless, because the challenged tariff

classifications are, at worst, “in between” classifications that

impose a facially discriminatory tax and classifications that are

not facially discriminatory, Plaintiff must at least include an

16

Totes agrees, for example, that it would not be gender-

based discrimination for the government to “classify” goods for

statistical purposes on the basis of the gender of the intended

wearer of those goods.

17

Cf. Engquist v. Oregon Dept. of Agriculture, ___U.S.___,

2008 WL 2329768 at *6 (June 9, 2008)(“Our equal protection

jurisprudence has typically been concerned with governmental

classifications that ‘affect some groups of citizens differently

than others.’” (quoting McGowan v. Maryland, 366 U.S. 420, 425

(1961))). Nor can Plaintiff claim that the alleged

discrimination affects importers differently based on gender.

Rather, the tariff classifications affect importers based on the

goods they import.

Court No. 07-00001 Page 18

allegation that the challenged tariff classifications distribute the

burdens of the tax rate imposed in a way that disadvantages one sex

as a whole, or has a disproportionate impact based on sex. To the

extent that the challenged tariff provisions do not impose a

facially discriminatory tax, Plaintiff must include an allegation

of some intent that renders plausible the claim that the

discrimination at issue is invidious, arbitrary or unreasonable.18

In the absence of such allegations, the Complaint does not provide

“plausible grounds to infer” a violation of equal protection or

allege “enough fact to raise a reasonable expectation that discovery

[or further proceedings on the merits] will reveal evidence of

illegal” conduct. Bell Atlantic, 127 S. Ct. at 1965. While

classification of goods as “for” men–-or for other persons-–may

suggest discrimination, it does not “show” it. As pleaded, we

simply are not informed of a discriminatory purpose or intent or of

the character of the discrimination that Totes seeks to remedy. We

are left to hypothesize: Is the challenged discrimination based on

the baggage of sexual stereotypes? Does it unconstitutionally

distribute the benefits and burdens of taxation? Is it prohibited

intentional discrimination? Because the Complaint, as presently

stated, does not “show” what the basis of Totes’ entitlement is, it

must be dismissed, without prejudice, for failure to state a claim.

/s/Donald C. Pogue

Donald C. Pogue, Judge

Dated: July 3, 2008

New York, N.Y.

18

Cf. Mfrs. Hanover Trust Co. v. United States, 775 F.2d

459, 465 (2d Cir. 1985) (examining whether gender-based mortality

tables used in calculating an estate’s tax obligations were

“invidious” by examining their “(1) aggregate impact on [the]

class; (2) demeaning generalizations; (3)stereotyped assumptions;

and (4)flawed use of statistics”).

ERRATA

Slip Op. 08-73, issued July 3, 2008

Totes-Isotoner Corp. v. United States

Please replace the preliminary paragraph identifying the counsel

for the Defendant with:

Gregory G. Katsas, Assistant Attorney General; Jeanne E.

Davidson, Director, Commercial Litigation Branch, Civil Division,

U.S. Department of Justice (Reginald T. Blades, Jr., Aimee Lee,

David S. Silverbrand and Gardner B. Miller)and, of counsel,

Yelena Slepak, Office of Assistant Chief Counsel, U.S. Customs

and Border Protection and Elizabeth Baltzan, Office of General

Counsel, United States Trade Representative, for Defendant United

States.