1 IN THE SUPREME COURT OF THE UNITED STATES 2 - - - - - - - - - - - - - - - -X 3 UNITED STATES, : 4 Petitioner : 5 v. : No. 99-1434 6 MEAD CORPORATION : 7 - - - - - - - - - - - - - - - -X 8 Washington, D.C. 9 Wednesday, November 8, 2000 10 The above-entitled matter came on for oral 11 argument before the Supreme Court of the United States at 12 10:02 a.m. 13 APPEARANCES: 14 KENT L. JONES, ESQ., Assistant to the Solicitor General, 15 Department of Justice, Washington, D.C.; on behalf of 16 the Petitioner. 17 J. PETER COLL, JR., New York, New York; on behalf of the 18 Respondent. 19 20 21 22 23 24 25 1 1 C O N T E N T S 2 ORAL ARGUMENT OF PAGE 3 KENT L. JONES, ESQ. 4 On behalf of the Petitioner 3 5 ORAL ARGUMENT OF 6 J. PETER COLL, JR., ESQ. 7 On behalf of the Respondent 27 8 REBUTTAL ARGUMENT OF 9 KENT L. JONES, ESQ. 10 On behalf of the Petitioner 48 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 2 1 P R O C E E D I N G S 2 (10:02 a.m.) 3 CHIEF JUSTICE REHNQUIST: We'll hear argument 4 now in Number 99-1434, the United States v. Mead 5 Corporation. 6 Mr. Jones. 7 ORAL ARGUMENT OF KENT L. JONES 8 ON BEHALF OF THE PETITIONER 9 MR. JONES: Mr. Chief Justice and may it please 10 the Court: 11 The harmonized tariff schedule employs more than 12 9,000 individual categories and more than half-a-million 13 words to classify every conceivable article of commerce 14 for tariff purposes. This massive document was drafted 15 initially by an international commission, and in 1988 it 16 was enacted in its entirety as a law of the United States. 17 Two terms ago in the Haggar case this Court held 18 that courts should defer to the reasonable interpretive 19 regulations adopted by the customs service to implement 20 these complex tariff provisions. In the present case, 21 however, the Federal Circuit held that it would give no 22 weight whatever to the interpretive rulings adopted by the 23 customs service to apply the tariff provisions in specific 24 situations under the very same statutory provisions. 25 The court, having concluded it would give no 3 1 deference to the agency rulings, then held that the 2 particular item involved in this case, known as a date 3 planner, would not constitute a bound diary within the 4 specific meaning of the tariff provision we have here 5 before us. In our view, the court's method of analysis 6 and its ultimate classification determination are both 7 incorrect. 8 In enacting a harmonized tariff schedule, 9 Congress specified that -- its understanding and intent 10 that the customs service would be responsible for 11 interpreting and applying these provisions, and for that 12 purpose Congress gave broad and varied types of 13 interpretive authority to the agency. 14 In particular, in 19 U.S.C. 1502, Congress 15 provided that the agency could adopt rules and regulations 16 for the classifications of goods under the tariff 17 schedules, and it was under that provision that this Court 18 applied Chevron and Haggar to say that reasonable 19 interpretations of ambiguous provisions set forth in 20 regulations should be applied by the courts. 21 Now, Congress understood, however, that the 22 regulations alone would not be sufficient to address the 23 infinite myriad of small interpretive problems that arise 24 under this kind of tariff legislation, and so Congress 25 specified and gave authority to the agency to adopt 4 1 binding interpretive rules for the purpose of applying the 2 statute in these discrete situations. 3 QUESTION: Mr. Jones, there is kind of a curious 4 feature. As I understand it, if a case on a tariff ruling 5 were to go to the Court of International Trade -- 6 MR. JONES: Yes. 7 QUESTION: -- as I understand it, it engages in 8 de novo review of the classification rulings? 9 MR. JONES: I think the -- we have used that 10 expressing in describing it -- 11 QUESTION: Yes. 12 MR. JONES: -- but as the Court pointed out in 13 Haggar, and as we have argued in these two cases, what 14 really happens is there is a de novo fact-finding on the 15 record made in the Court of International Trade. 16 QUESTION: Do you think that court affords some 17 kind of deference to the views of the customs service, and 18 would it be some kind of deference to the ruling such as 19 we have here? 20 MR. JONES: Well, Haggar also pointed out that 21 what the court does is, in determining what the law is 22 that it applies these facts to, it looks to the agency's 23 interpretations, and we think it should look to the 24 agency's rulings. That's -- 25 QUESTION: And you think that's clear? 5 1 MR. JONES: Yes. 2 QUESTION: And what kind of deference to do they 3 give it? Is it Chevron, or something less -- 4 MR. JONES: Well, what they have -- 5 QUESTION: -- such as so-called Skidmore, and 6 what are you urging us is the proper rule? 7 MR. JONES: Our -- what we are urging you is 8 that it is the deference that the Court described in 9 Chevron, that is that you -- that the Court is to defer to 10 the reasonable interpretations set forth in these binding 11 rulings, and what -- in the NationsBank v. Variable 12 Annuity case the Court described these as a deliberative 13 conclusions set forth in the agency's interpretations. 14 QUESTION: But not adopted after notice and 15 comment, and so is there some lesser kind of deference, 16 such as suggested in the Skidmore case? 17 MR. JONES: Not in this context. I mean, let me 18 point out that when we're talking about interpretive 19 rulings they are routinely initiated by the importer 20 themselves. The importer has ample opportunity to make 21 comments on how they think this procedure should be -- how 22 that statute should be interpreted, and when the agency -- 23 if the agency adopts that interpretation and then some 24 other importer doesn't agree and they want to ask for a 25 different ruling, they can submit and request an 6 1 interpretive ruling, and that's what's -- 2 QUESTION: How does this differ from the Labor 3 Department ruling in Christiansen, which we said was not 4 entitled to Chevron deference? 5 MR. JONES: In Christiansen the Court said that 6 there was an informal opinion stated in a format that 7 Congress had not provided for official interpretations. 8 Here, we have a formal provision of Congress directing the 9 agency to make these kinds of interpretive determinations 10 and to make them in a binding way. 11 QUESTION: It was dictum in Christiansen anyway, 12 wasn't it? Didn't the Court find that it wasn't a 13 reasonable interpretation? 14 MR. JONES: I believe that's correct. The Court 15 concluded that it was not, in the words of Skidmore, 16 entitled to any consideration because it wasn't 17 persuasive, but I -- clearly the Court was of the view 18 that it was not a reasonable interpretation, and -- 19 QUESTION: Mr. Jones, could we just back up a 20 bit? Your answer to Justice O'Connor about the Court of 21 International Trade owing some deference -- 22 MR. JONES: Yes. 23 QUESTION: -- to the customs rulings, as far as 24 I recall, in this very case, although the Court of 25 International Trade upheld the customs classification, 7 1 there wasn't one word that they said, so we don't know 2 from this case what position the Court of International 3 Trade takes on this question. 4 MR. JONES: Well, historically we know the court 5 said that it would defer to reasonable interpretations of 6 the service, but in this -- you're very right about the 7 oddity of the specific issue, the way it came up, and we 8 addressed that at the petition stage. 9 What happened was that when Haggar was before 10 this Court, the United States did not press the lower 11 court to apply what is now to be called Haggar or Chevron 12 deference because the Federal Circuit had said in Haggar 13 that it would give no weight to customs service 14 interpretations, and so at the time the case was in the 15 Court of International Trade, that court was not asked to 16 give that type of deference to the agency's 17 interpretation -- 18 QUESTION: But the -- 19 MR. JONES: -- because that was the law of the 20 circuit. 21 Once this Court reversed the circuit ruling in 22 Haggar, this -- the Federal Circuit then addressed how the 23 principles of Haggar and Chevron applied. 24 QUESTION: But that didn't happen until the case 25 was in -- 8 1 MR. JONES: In the Federal Circuit, but I would 2 point out that respondent has agreed, and we think it's 3 clear that the Court of International Trade applied the 4 same definition of bound diary that the ruling sets forth. 5 QUESTION: May I ask you before we get to the 6 specific ruling, you're asserting that there should be 7 deference equivalent to Chevron deference. 8 MR. JONES: Yes. 9 QUESTION: And yet, as I understand it, there 10 are two features of this that would lead me to hesitate 11 about that. One is that the vast majority of these 12 rulings, as I understand it, are just you'll classify 13 this, you'll classify that, with no reasons elaborated, 14 and the other is that you don't have one decisionmaker, as 15 you would have, say, for the EPA. Instead, you have 16 decisions that are dispersed among 45 ports of entry. 17 MR. JONES: Well, let me address the second 18 point first. I think in Smiley v. Citibank the Court had 19 a similar situation where there was a subsidiary 20 determination that was then reviewed by the headquarters 21 office to result in a final agency determination, which is 22 the process that we've gone through with respect to these 23 rulings, and the Court said, well, that doesn't result in 24 a change of view, it results in a proper application of 25 the agency's ruling process. 9 1 With respect to the first point, the respondent 2 says, well, there are 10,000 a year of these kinds of 3 rulings made in the head -- in the regional offices. In 4 fact, we do not claim that there's -- we are unaware of 5 any of those rulings in which there would be what the 6 Court, in the opinion you authored for the Court in the 7 Variable Annuity case call the deliberative conclusions. 8 It is only the deliberative conclusions that set forth the 9 actual interpretations of provisions that the Court can 10 look to to defer to. It's not simply the result. 11 And in most of the simple tariff entry at issue 12 determinations, of course it's a very simplified 13 procedure. It has to be, because of the volume of 14 transactions at issue, and those kinds of entry-level port 15 determinations are very simple, and the Trade Bar 16 Association brief acknowledges they contain in almost 17 every instance no discussion. They just contain the sort 18 of a statement that 12 apples come in as apples. 19 QUESTION: Can't you appeal that within the 20 agency? 21 MR. JONES: Yes, and the agency has -- 22 QUESTION: Don't you have to appeal it within 23 the agency before you go to court? 24 MR. JONES: I don't believe you have to. I -- 25 QUESTION: You don't have to? 10 1 MR. JONES: The agency -- it's an election of 2 the importer whether he wants, whether he can ask -- he 3 can ask the headquarters for a ruling in the first 4 instance. He can ask the headquarters to review a field 5 determination. 6 QUESTION: And you'd say that any ruling by the 7 headquarters either on review or as an original matter is 8 entitled to Chevron deference. 9 MR. JONES: That is correct. To the extent -- 10 QUESTION: But not the rulings that come out of 11 the field and are not reviewed. 12 MR. JONES: As a practical matter, that's true, 13 but I would say that either of them would be entitled to 14 deference to the extent they contain deliberative 15 conclusions, and I'm just being finicky about that because 16 as a practical matter the entry-level port determinations 17 don't contain those kinds of -- 18 QUESTION: Why is that? I mean, if it comes out 19 of headquarters it's obviously been considered at a high 20 level within the agency and they say, this is the answer. 21 Why should -- 22 MR. JONES: I think as a practical matter the 23 agency would have no objection to a determination of that 24 type. It's just, all I'm addressing is the logical basis 25 by which the Court would reach such a determination. 11 1 QUESTION: Well, but I mean, if we're going to 2 use that criteria -- you see, I thought Chevron was just, 3 if it's an authoritative agency position we defer to it, 4 but if you're going to hang qualifications on that, that 5 is, it has to be an authoritative agency position that is 6 explicated in written opinion, you might as well add the 7 fillips that your brother suggests, which is only those 8 rulings that are the product of formal rulemaking. The 9 one is as logical to me as the other. 10 MR. JONES: Well, the -- I'm not -- I think what 11 I'm trying to describe and not doing a very good job at it 12 is simply that it's up to what -- the ultimate question is 13 what did Congress intend? How did Congress intend the 14 agency to function? 15 The best evidence of that is probably the 16 agency's regulations pursuant to the authority that 17 Congress gave the agency to provide for a binding ruling 18 program. The agency's regulations specify that the port 19 service's rulings are precedential and binding, but they 20 don't go on to say, because it's up to this Court to say, 21 the extent to which those precedential binding 22 determinations are to be given deference by the courts, 23 and all I was trying to say was that it seems to me that 24 when this Court has addressed interpretive rulings in 25 prior cases, like Variable Annuity, PBGC v. LTC, it has 12 1 looked to the question of whether the -- you can look to 2 the interpretation expressed by the agency -- 3 QUESTION: Well -- 4 MR. JONES: -- and find in it a reasoned -- 5 QUESTION: Well, you say that Christiansen was 6 not an interpretive ruling? 7 MR. JONES: Not in the sense that we're using 8 that term in this case. What Christiansen was was the 9 private correspondence that was sent -- 10 QUESTION: Well, private correspondence by the 11 Secretary of Labor, wasn't it? 12 MR. JONES: Well, actually it was sent by the 13 Wage & Hour Division of the Labor Department. 14 QUESTION: Okay, but you wouldn't call that -- 15 those people are paid by the Government. 16 MR. JONES: Right, but what the -- but I think 17 what this -- the Court's concern in Christiansen was that 18 there was no evidence that that was an official 19 interpretation of the type that Congress had authorized 20 the agency to use to interpret the statute. 21 Here, we have a statute that expressly tells the 22 agency to make these kinds of binding determinations, and 23 the agency's done it just the way Congress said. 24 QUESTION: Well, could you go back for a second 25 on that to the first question that Justice O'Connor put to 13 1 you, and she said there's a statute that says, in effect, 2 that the Court of International Trade is to review these 3 things de novo, to which you replied no, it's just 4 reviewing matters of fact. 5 MR. JONES: Yes. 6 QUESTION: But my copy of the statute says 7 nothing about matters of fact. What it says is, the Court 8 of International Trade shall make its determinations upon 9 the basis of the record before the court. The importers 10 tell us, the textile importers tell us there's hardly ever 11 a dispute of fact. 12 You know, this is what it is. Everybody knows 13 that, that almost all these things concern how you apply a 14 tariff or -- to the facts and the Customs Trade Bar tells 15 us that if we set down the distinction you want to make 16 between facts and application of the tariff, this whole 17 thing's unworkable, because people would never be able to 18 figure out, or hardly ever, what's going on, which is 19 which. So that would seem to be a pretty strong argument 20 that Justice O'Connor's initial characterization was right 21 as opposed to the application of these tariffs, and I'd 22 like you to respond to that. 23 MR. JONES: The function of the interpretive 24 binding ruling program is to make the system more workable 25 by providing effective advanced guidance. 14 1 QUESTION: They didn't say that was unworkable. 2 What they said would be unworkable would be for the Court 3 of International Trade to figure out, you know, is it a 4 question of fact, is it a determination of application of 5 the tariff, et cetera. 6 MR. JONES: It's -- this -- I believe the Court 7 has already addressed this very point in the Haggar case. 8 Chevron deference is about how you decide what the law is. 9 There are other doctrines, burden of proof, presumption of 10 regularity, that go to about how you decide what facts are 11 and how the facts apply to law. 12 Chevron is simply a doctrine about how does a 13 court decide what the law is, and in this case the agency 14 made a determination about legal issues and said what it 15 believed a diary was, for example, or what it believed the 16 law, properly interpreted was, bound for this purpose is. 17 Having made that legal determination, it's then 18 up to the Court of International Trade to decide whether 19 these facts represent such an item. Of course, the 20 agency's binding rulings state its own view of what the 21 facts are and how they apply to these legal 22 interpretations, but that's what the Court of 23 International Trade has the right to do de novo, to decide 24 whether these facts fit within the legal determination, 25 the legal interpretation that the agency has expressed in 15 1 the binding ruling. 2 QUESTION: Suppose we were to hold -- 3 MR. JONES: It's just like tax cases. 4 QUESTION: Suppose we were to hold that Chevron 5 deference applies to regulations that are adopted under 6 the EPA with notice and comment, and that this does not 7 qualify, but that this ruling, or this determination gets 8 a Skidmore deference. 9 Do you think that the courts would find that 10 that's a meaningful difference? Oh, this is just a 11 Skidmore case and therefore I can rule as follows. If it 12 had been a Chevron case, I would have to rule -- 13 MR. JONES: Well, addressing your practical 14 question before I -- I do want to respond to your question 15 about how this might be looked at. Your practical 16 question is, does it make a difference. Yes, it makes a 17 big difference. 18 QUESTION: Okay. 19 MR. JONES: Because if we -- if you had the sort 20 of sliding scale approach of the Skidmore doctrine, then 21 no one would know until the end of the day what -- you 22 know, how much -- how effective the agency's 23 interpretation is, and the advantage of the Chevron 24 approach, if you needed to look at it in a practical 25 sense, is that everyone knows at the outset what the 16 1 effectiveness of the agency's interpretation is. It's to 2 be upheld if it's reasonable. 3 Now, I would like to point out that this Court 4 has never held, and would have to overrule several cases 5 if it did now, that Chevron deference requires that the 6 agency issue this regulation with notice and comment. 7 There are cases in which this Court -- 8 QUESTION: I understand. 9 MR. JONES: Okay. 10 QUESTION: In one of your earlier responses, 11 your first response I think to Justice O'Connor, you said, 12 oh, no, Skidmore deference would be inappropriate. As a 13 fallback position, if we say, no Chevron deference, I 14 assume you would urge some sort of Skidmore -- 15 MR. JONES: I would assume that if the Court 16 were to conclude that Chevron deference didn't apply it 17 would then conclude Skidmore was an appropriate formula to 18 look at this issue under. 19 QUESTION: But you say Skidmore is inappropriate 20 in order to urge upon us Chevron -- 21 MR. JONES: I don't really remember having used 22 that phrasing. What I -- I think Chevron's analysis is 23 appropriate. This Court's applied it in other 24 interpretive ruling situations, and only in that sense is 25 Skidmore inappropriate. 17 1 QUESTION: Mr. Jones, you said something very 2 quickly, but I wanted to be sure I understood your 3 position about tax rulings, revenue rulings. 4 MR. JONES: Yes. 5 QUESTION: How do they compare to customs 6 classifications, and if you could just -- probably you 7 made this clear already. You are not claiming deference 8 for just stamped, this, that. 9 MR. JONES: That's right. 10 QUESTION: It's only when we have a reasoned 11 decision as we do in this case. Okay. 12 MR. JONES: Right. With respect to revenue 13 rulings, the history on this is sort of interesting, and 14 it'll take me a minute to explain it all. In United 15 States v. Correll, this Court held that revenue rulings 16 should be upheld when they're reasonable, and the Court 17 emphasized that it was based on the expertise of the 18 agency and the fact, to quote the Court, that it doesn't 19 sit as a committee of revision to perfect the 20 administration of the tax laws. The Congress told the 21 agency to do that by authorizing it to issue all necessary 22 rules and regs. 23 Now, the tax counsel amici says no, that case 24 was really about a regulation, not about a ruling. Well, 25 that's simply and flatly, clearly wrong. The regulation 18 1 they cite had something to do with the procedures as used 2 to make a claim for a deduction. 3 When Justice Marshall was Solicitor General, he 4 filed the Government's brief in the Correll case. His 5 successor, Solicitor General Griswold, filed a reply 6 brief. Neither of those briefs mention any regulation. 7 They rely just on the revenue ruling of the service and 8 ask the Court to defer to it, which is what Justice 9 Stewart's opinion for the Court said was appropriate. 10 QUESTION: But that was pre-Chevron, so we don't 11 know -- 12 MR. JONES: Yes. 13 QUESTION: -- exactly what they meant by 14 deference. 15 MR. JONES: Well, we know exactly what they 16 meant, if we -- I mean, reading the opinion it says that 17 the agency's reasonable interpretation should be accepted. 18 It was a pre-Chevron Chevron case. 19 QUESTION: Well, have we addressed this issue 20 post-Chevron? 21 MR. JONES: That's where it became confusing, 22 and there's a nomenclature shift that occurred that really 23 hasn't been addressed. Prior to the 1960's, there were 24 two kinds of rulings. There were Treasury decisions 25 issued by the Secretary, and there were Commissioner's 19 1 rulings that were published in what's called the 2 Cumulative Bulletin. 3 The Cumulative Bulletin pointed out before 1960 4 that the Commissioner's rulings were not approved by the 5 Secretary, therefore they weren't binding on the agency. 6 In 1961, the Commissioner was given interpretive 7 authority in a regulation we've cited in our brief, and 8 that interpretive authority is subject, however, to the 9 approval of the Secretary, and since that time, what are 10 now called Revenue Rules, with a capital R, are issued by 11 the Commissioner with the approval of the Secretary. 12 They are functionally the same as Treasury 13 decisions were before 1960, and in the cases before 1960 14 the Court had pointed out Treasury decisions were entitled 15 to substantial deference, and even in Skidmore the Court 16 pointed out they were often decisive. 17 After Correll -- I'm sorry. After Correll and 18 indeed, I think after Chevron, but in any event in that 19 time frame, Justice Marshall wrote an opinion for the 20 Court, bringing this full circle, in which he said that a 21 Treasury decision issued in connection with a customs 22 ruling should be given -- should be accepted if it's 23 reasonably -- if it's sufficiently reasonable. That's the 24 way -- that's why I pointed out that revenue rulings and 25 Treasury decisions and customs interpretive rulings have 20 1 followed a path that should lead to the same result. 2 QUESTION: But here we're -- we get back to 3 something you've already talked about, which is a little 4 curious. As I understand it, the customs maybe issues 5 over 12,000 classification decisions annually, and only 6 some of them involve some kind of legal conclusion, or 7 explanation. 8 MR. JONES: Right. 9 QUESTION: And you would say it's only the 10 latter that deserve Chevron deference? 11 MR. JONES: I would say only to the extent that 12 they contain that kind of deliberative conclusion that the 13 Court -- 14 QUESTION: But not these thousands of rulings 15 that are issued every year. 16 MR. JONES: There isn't an interpretation stated 17 in a ruling of the type they're talking about, which 18 simply says an apple's an apple. 19 QUESTION: Mr. Jones, could I ask just one 20 clarifying question? I'm having difficulty drawing the 21 line between what it is the international court has to do 22 de novo and what is entitled to deference, and I thought 23 you said that they're entitled to deference if they're 24 applying -- they're deciding whether a particular item 25 fits within the rule, whether a particular document as we 21 1 have here is a diary or not. Why isn't that the very 2 thing that's supposed to be decided de novo under 3 what's -- 4 MR. JONES: Because to decide that they have to 5 know what a diary is, and that's a legal conclusion. It's 6 like instructing a jury. The jury is instructed that a 7 diary means these things, and then the jury decides 8 whether this thing is a diary under that set of 9 definitions. 10 That's what Haggar said. Haggar said that 11 it's -- there's nothing inconsistent with the 12 responsibility of the Court of International Trade to make 13 this de novo -- 14 QUESTION: But isn't that always what the Court 15 of International Trade does, is decide whether the item 16 that is presented -- there are no disputing the facts 17 about what the item is, whether it is the particular thing 18 described in the rule? Isn't that what they always do? 19 MR. JONES: But they -- to make that second 20 step, they have to know what the law is and all -- and 21 what Haggar said and what we think is clear in Chevron 22 cases generally, is that in deciding what the law is the 23 Court should defer to the agency's real interpretations. 24 It might be that I can make this clearer by 25 focusing on the facts of this case, which would probably 22 1 be useful in any event. In this case, the agency said 2 that -- 3 QUESTION: Mr. Jones, just before you get there, 4 and in this picture of deference based on, among other 5 things, expertise, does the Federal Circuit in the 6 Government's view owe any deference to the Court of 7 International Trade? 8 MR. JONES: I believe the decisions of the Court 9 of International Trade are reviewed like the decisions -- 10 QUESTION: Of a district court, and no special 11 credit is given to the specialization of the Court of 12 International Trade? 13 MR. JONES: That's correct. I mean, of course, 14 to the extent that the Court of International Trade makes 15 factual determinations, then its determinations -- 16 QUESTION: But it would be just like a district 17 court? 18 MR. JONES: It would be just like a district 19 court. 20 QUESTION: Are you going to finish your answer 21 to -- 22 MR. JONES: In this specific -- 23 QUESTION: -- and then I have a question. 24 MR. JONES: Okay. In this specific case, the 25 agency, in our view, reasonably concluded that the 23 1 definition of a diary, which the agency found from a 2 dictionary to be -- 3 QUESTION: Well, I understand that, but what is 4 it that the International Trade -- the Court of -- was 5 supposed to do in this case? What did they have to do de 6 novo, just decide that that document -- 7 MR. JONES: They're supposed to decide whether 8 the -- 9 QUESTION: -- is what that document is? 10 MR. JONES: They're supposed to decide whether 11 the item that has been brought to them -- 12 QUESTION: Right. 13 MR. JONES: -- constitutes a bound diary, and in 14 deciding whether it's a bound diary, they have to know 15 what the law -- what that legal definition is of a bound 16 diary, and in deciding that, they're supposed to look to 17 the agency's interpretation, if it's a reasonable one. 18 And again, I think I can make this more concrete 19 by pointing out that the -- here's the way it worked in 20 this case. The ruling said that a diary is a book for the 21 keeping of a record of daily events, and that that 22 definition is broad enough to encompass the commercial 23 usage of that term, which is a business diary, which has 24 been commonly employed and, under cases like Stone and 25 Downer, the agency and the courts are supposed to consider 24 1 in deciding what the terms of the tariff provisions mean. 2 Now, what the court of appeals said was, well, 3 we think that -- we want to add two things to that. We 4 want to say it has to be room for extensive notations, and 5 it has to be retrospective, but the diary definition 6 doesn't say that in the dictionary. There -- you can find 7 alternative dictionary definitions, and the commercial 8 usage is inconsistent with that. 9 QUESTION: Mr. Jones -- 10 MR. JONES: Yes. 11 QUESTION: -- why wouldn't a judgment that's 12 made in the field, that isn't appealed, but once it gets 13 into court, presumably the agency at a high level decides 14 that this ruling, made out in the field, ought to be 15 defended in court, why doesn't that represent an official 16 agency endorsement of that position made in the field? 17 MR. JONES: It is an official agency position at 18 that point. 19 The problem I've had in giving an answer that's 20 better on this for your -- from your perspective is that I 21 don't under -- I think that if you look at the way these 22 decisions are made at ports of entry, and the way they're 23 intended to be made at ports of entry, there is little in 24 the face of that document that gives a reasoned 25 explanation of the agency's interpretation. 25 1 By comparison, the headquarters rulings are 2 thorough, they provide a definite description of the text, 3 and internally the agency has advised its regional offices 4 to not include a full discussion of text, and I'm going 5 outside the record, but I have to answer your question, 6 and internally the understanding is that if the issue is 7 complicated enough it will get referred to the 8 headquarters. 9 Now, that doesn't mean that complicated issues 10 aren't resolved at the field office, but it does mean that 11 when the field offices ordinarily determine them it's not 12 with a deliberative explanation. That -- to get that, you 13 go to the headquarters. 14 QUESTION: Mr. Jones, I want to get clear on two 15 points about the deference that the agency itself gives to 16 these rulings. My two questions are these. First, with 17 respect to the importer for whom the ruling was given in 18 the first place, is it correct that the Government can 19 always in effect withdraw the ruling as a precedent for 20 future cases simply by telling the importer by letter or 21 otherwise, you can't rely on this prior ruling? 22 MR. JONES: No. 23 QUESTION: My second question is, would you 24 explain what reliance someone other than the original 25 importer can place on it? 26 1 MR. JONES: Well, the statute and regulations 2 specify that before a ruling that has been issued may be 3 modified or overruled, public notice and comment, an 4 opportunity to comment, has to be given. That's in 5 1625(c). 6 QUESTION: Okay, so they can't just withdraw it. 7 MR. JONES: They can't just withdraw it, and 8 even when they change it for a period of 60 days there's 9 an automatic protection of people who are using the old 10 ruling. 11 If I may reserve the balance of time for my -- 12 QUESTION: Very well, Mr. Jones. 13 Mr. Coll. Am I pronouncing your name correctly? 14 MR. COLL: You are, sir. 15 ORAL ARGUMENT OF J. PETER COLL, JR. 16 ON BEHALF OF THE RESPONDENT 17 MR. COLL: Mr. Chief Justice, and may it please 18 the Court: 19 I'd like to start by picking up on a question 20 that Justice Souter just asked, and that is, may it be 21 revoked, may it be modified without further proceeding 22 between the customs service and the importer, and at the 23 time that these rulings issued, the answer to that is yes. 24 There was no notice required. 25 As the record reflects, in June of 1991 they 27 1 classified this day planner as a unbound diary, duty free. 2 In 1993, without notice, without any further proceeding, a 3 letter was received from the customs service saying that 4 that classification had been changed. 5 QUESTION: With no waiting period? 6 MR. COLL: No. We -- 7 QUESTION: So that the very day of the notice, 8 it became dutiable? 9 MR. COLL: We had the opportunity, which we took 10 advantage of, which was to get a detrimental reliance 11 letter from the customs service that said to the effect 12 that those imports that were in process we were able to 13 rely on the previous ruling, on the previous 14 classification ruling, but that we could not rely in the 15 future, so that the first revocation allowed us to take 16 those orders that we had in process and bring them in duty 17 free, but thereafter we now had duty attached. 18 QUESTION: Now, is there a different regulatory 19 scheme in effect today? 20 MR. COLL: There is now a notice provision that 21 requires publication in the Customs Bulletin. 22 QUESTION: Is that the one that's set forth in 23 page 3 of the Government's brief? 24 MR. COLL: I don't have it by the page, Your 25 Honor, but I believe it is. 28 1 QUESTION: 19 U.S.C. 1625? 2 MR. COLL: That's correct, and its reflected in 3 the -- in 19 C.F.R. -- 4 QUESTION: But that was not in force in the case 5 before us? 6 MR. COLL: It was not. It was not in force at 7 that time. There was -- there's a second notice provision 8 that has been raised by the Government in its brief, and 9 that relates to change in practice, but this was not a 10 change in practice, either, as the courts have defined 11 that particular regulation, so that the importer here 12 received a classification ruling in 1991. It was revoked 13 in 1993 without further proceeding. Now -- 14 QUESTION: Now, with respect -- with respect to 15 reliance by someone other than the original importer, as I 16 recall the briefs there was a difference of opinion 17 between you and Mr. Jones on that, and I think his 18 response to you was that the -- that someone other than 19 the original importer can rely unless notice is given by 20 the Government. Have you resolved your difference on 21 that? 22 MR. COLL: Well, I think it's probably a matter 23 of practice as much as it is a matter of the 24 interpretation of the rules, or the regulations. 25 Under 19 C.F.R. 177.9 it sets forth very clearly 29 1 who may rely on a particular classification ruling. The 2 importer may rely who has sought the classification ruling 3 on that ruling for those goods in similar circumstances. 4 That is who may definitely rely. 5 Other importers may rely, may -- but they are 6 not certain that it is even in effect any longer because 7 of the way the rule -- because of the way the service runs 8 its classification rulings, and it says -- and this is 9 where the Solicitor General took me to task, I think, is 10 that there's a second sentence that says, if you want to 11 know what the current ruling is, you can contact us and by 12 the way, send us enough information so we can figure out 13 what it is that may pertain to you, so it is not -- 14 QUESTION: So they -- in any case they can get a 15 prospective determination as long as they're on their 16 toes. 17 MR. COLL: I don't think it's a prospective 18 determination. What they can get is a current status of 19 how a particular good has been classified for a particular 20 importer at a given point in time. 21 QUESTION: Well, does -- 22 MR. COLL: Whether -- 23 QUESTION: I should have the reg in front of me 24 and I don't, but does the reg say anything about the 25 reliance that may be placed upon a ruling once the 30 1 Government has said yes, this ruling is still in effect? 2 MR. COLL: No, I don't believe it does. The 3 problem here, as I see it, to ask for Chevron deference, 4 which I view as mandatory, controlling weight deference, 5 rather than Skidmore deference -- 6 QUESTION: Well, on that point, Mr. Coll, this 7 Court had a holding in NationsBank v. Variable Annuity 8 Life Insurance where we held that a letter ruling by the 9 Comptroller of the Currency warranted Chevron deference. 10 How is this different? 11 MR. COLL: Well, I would focus on the question 12 in that case as posed by Justice Ginsburg, which said, may 13 or can national banks in the United States sell variable 14 annuities, question mark, and that was -- as I understood 15 that question, viewed by this Court, that ruling was now 16 going to be applicable to every national bank in the 17 United States and as I've just discussed -- 18 QUESTION: Well, I suppose that we can assume 19 that the customs service made clear that it thought that 20 anything like a filofax here with the little entry spaces 21 on pages in a loose-leaf binder met the definition. 22 Apparently that was their idea. 23 MR. COLL: I don't think we can assume that. 24 QUESTION: No? 25 MR. COLL: I don't think we can assume that. 31 1 The problem is that by definition of the regulations of 2 the service itself, these are applications of the customs 3 law to the specific facts presented by the importer, 4 and -- 5 QUESTION: Well, would you concede that at least 6 the customs has taken the position that a loose-leaf ring 7 binder is bound? I mean, they at least said that, 8 apparently. 9 MR. COLL: For purposes of 4820 I think we can. 10 I don't know -- 11 QUESTION: What do you mean, of 4820? 12 QUESTION: A statute? 13 MR. COLL: The statute, I'm sorry. 14 QUESTION: There's a statute -- 15 MR. COLL: A statute of -- 16 QUESTION: -- that refers to bound diaries, 17 right? 18 MR. COLL: -- 19 U.S.A. section 4820. 19 QUESTION: Oh, but that's all that we're talking 20 about. I mean, that's -- in applying that to any other 21 importer, surely you anticipated that the agency would 22 take the same position. The agency can't say for one 23 importer it -- you know, a ring binder is okay, for 24 another importer it isn't. I mean, once they make that 25 ruling, don't you know that the agency has taken that 32 1 position of law? 2 MR. COLL: Well, we don't know that under the 3 particular section of 177.9 of their regulations, because 4 they tell us similar articles, or identical articles or 5 similar circumstances, and therefore they hedge that 6 relative to every importer who comes to a dock -- 7 QUESTION: Well, surely it means similar 8 relevant circumstances. You -- they can say, you know, 9 you have blond hair and the other guy had brown here. You 10 think that they'd say, not similar circumstances? 11 MR. COLL: I don't know. I'd suspect not, but I 12 don't know. But what we have here, just to look at the 13 record, we start out in 1991 with an identical -- the same 14 product that we had in 1993 and that we had in 1994, when 15 it made it into headquarters and their view changed. 16 QUESTION: Ah, but the exact question I think 17 is, I could imagine -- it's all hypothetical -- being a 18 Member of Congress and if I were asked, do you really want 19 the Comptroller of the Currency to have some binding 20 authority when he writes a letter answering the question 21 that was posed, you'd say, yeah, that's a pretty good 22 idea. He knows quite a lot about these things. 23 Then similarly, if you were a Member of 24 Congress, you might say, would you want these several 25 thousand customs inspectors to have the authority of 33 1 whether the word bound does or does not include these ring 2 binders? Well, you might say yeah, they know a lot about 3 it, similar answer. Now, there's a lot of confusion 4 getting to whether you get a firm position, but if you get 5 a firm position at the agency, yes, defer to that. 6 That's the question. That's why I thought maybe 7 your stronger point was the statute. 8 MR. COLL: Well -- 9 QUESTION: And I'd like to hear both the answer 10 to that question and something about the statute. 11 MR. COLL: Well, I'd like to go to what Congress 12 may have said with regard to whether or not the customs 13 service should be binding, and we looked to the 14 legislative history in 1979 with regard to de novo review, 15 and that legislative history said, in light of the Zenith 16 Radio case it's precedents suggested that deference should 17 be given to the customs service rulings, that -- 18 QUESTION: On most of these things Congress says 19 nothing. What you're trying to do is make sense of some 20 kind of statutory scheme. Looking at the scheme, would it 21 make sense to give the power to make somewhat binding 22 rulings under Chevron to this particular official in this 23 kind of instance under these circumstances. 24 MR. COLL: I -- 25 QUESTION: So that's how I'd look at it. 34 1 MR. COLL: And responding to that question -- 2 QUESTION: Yes. 3 MR. COLL: -- I believe the answer is no, that 4 Skidmore deference would be appropriate, but Chevron 5 deference would be inappropriate. To -- 6 QUESTION: I don't understand. What is the 7 criterion for just saying we're going to give deference 8 to, you know, formerly adopted regulations? I can 9 understand a criterion that tries to assess whether the 10 agency's view that has been expressed is authoritative, 11 but surely the agency's view on this issue has been 12 authoritatively expressed in this case by the Solicitor 13 General. 14 I mean, we know that the agency believes that 15 this is what the law says. Now, why should we give one 16 sort of deference if the agency tell us that in a 17 regulation with notice and comment and another kind of 18 deference if it comes to us in some other fashion? So 19 long as it's the agency's authoritative view, what 20 difference should it make? 21 MR. COLL: Well, that question, as I would 22 understand it, starts from the premise that we're going to 23 somehow narrow this field of classification rulings from 24 the 10 to 15,000 that issue each year to some smaller 25 group that purportedly are qualitatively better, certainly 35 1 quantitatively less, and if that's the case, then I think 2 we also need to not lose sight of the fact that these are 3 mixed conclusions of fact and law, even when articulated. 4 And for example, in our particular ruling, the 5 third ruling, the one that I assume the Solicitor General 6 says that the deference to attach -- should attach to, not 7 the earlier ones, the last. 8 There, the -- Mr. Durant, who was the fellow who 9 exercised that discretion, that interpretation, and who 10 signed that letter, says that he has reached his 11 interpretation on the basis of factual analysis, ex parte 12 factual analysis, ex parte to anything that this importer 13 had an opportunity to respond to. 14 It says -- this is at 32a of -- it begins at the 15 bottom of 31a. It's 32a in the petition for the writ of 16 certiorari, and it says, the rationale for this 17 determination was based on lexicographic sources as well 18 as extrinsic evidence of how these types of articles are 19 treated in the trade and commerce of the United States. 20 Now, that record was made -- 21 QUESTION: Mr. Coll, does that get a presumption 22 of deference -- of correctness? That's the other piece of 23 this statute, that this Court of International Trade is 24 supposed to accord decisions of customs a presumption of 25 correctness, is that right, and that's statutory? 36 1 MR. COLL: That's correct, and it's as to facts, 2 and it's part of the process. I mean, this process -- 3 QUESTION: You're getting into the same problem 4 that we have in discussing this with Mr. Jones, what is 5 fact as opposed to law in these customs classifications? 6 MR. COLL: Exactly. What we have here -- 7 QUESTION: Well, gee, I don't think that -- you 8 say, was based on lexicographic sources. I assume he's 9 talking about dictionaries. 10 Now, I guess you can say it is a question of 11 fact whether dictionaries say this or that. I mean, 12 everything in the world is a question of fact, but when we 13 issue a ruling on a point of law that relies in part on 14 dictionaries, I don't consider that a mixed -- a ruling on 15 a mixed question of fact and law, did the dictionary say 16 this and is it accurate that that produces this result. 17 MR. COLL: It's -- 18 QUESTION: And the other one is extrinsic 19 evidence of how these types of articles are treated in the 20 trade and commerce of the United States. I mean, I 21 don't -- you know, if that is a factual question, it is a 22 factual question of the generic type that we usually 23 subsume under the term of judicial notice. I mean, what 24 do people usually think of diaries as? You can call that 25 a question of fact, if you like, but my goodness, I think 37 1 that's still a legal determination. 2 MR. COLL: Well, I beg to differ. I think it is 3 a question of fact. The Government, the -- as well as the 4 importer treat it as a question of fact. On the filing of 5 the action in the Court of International Trade, both 6 parties filed -- the -- both parties filed affidavits, 7 affidavits relating to the facts, relating to commercial 8 use, relating to commercial jargon as to how these 9 products were described within the trade, and so both 10 sides here treated that portion as being an item of fact. 11 And I don't think that it makes much sense, when 12 we talk Chevron deference, we talk about the Haggar case, 13 which says that Haggar stems -- that deference stems from 14 the creation of a legal norm, to put to the Court on a 15 mandatory basis deference that has a mixed question of 16 fact, or a mixed conclusion of fact and law, and say to 17 them, now, you may apply whatever that is to what remains 18 of the facts. 19 QUESTION: Well, but that's a different point 20 that you should be arguing, then, not that all these 21 rulings are not entitled to deference, but rather that the 22 ruling in this case is not a ruling purely of law, but it 23 involves factual matters and therefore should get, indeed, 24 de novo review if it went to the Court of International 25 Trade. 38 1 MR. COLL: That goes to the second question that 2 was certified, which is -- and we approach it under 3 Skidmore -- does this have persuasive effect, the power to 4 persuade, and we say it has absolutely none for any number 5 of reasons. 6 QUESTION: Mr. Coll you were -- 7 QUESTION: Do you accept what Justice Scalia 8 just said -- I'm quite curious about that -- that, I'd 9 thought the difference between this and Smiley is, here 10 there is a specific statute, and that statue says that the 11 Court of International Trade will make its determinations 12 de novo? 13 Now, the Government says that that word, 14 determinations, means simply matters of fact, not matters 15 of whether, given agreement about the facts, this is a 16 bound or unbound thing for purposes of the tariff. Is 17 that -- in other words, do you agree with what -- he 18 wasn't saying it particularly, but I mean, do you agree 19 with that characterization, that determinations cover only 20 matters of fact? 21 MR. COLL: No. 22 QUESTION: No. Why not? 23 MR. COLL: Because I don't think the one can 24 dissect even this, what the Solicitor General would 25 concede is as elaborate a classification ruling as one 39 1 normally finds that one can dissect the fact from the law. 2 QUESTION: Well then, do you disagree with 3 Haggar? 4 MR. COLL: Well, Haggar -- 5 QUESTION: It sounds to me like you're 6 disagreeing with Haggar in your answer to Justice Breyer. 7 MR. COLL: Haggar is a much different situation, 8 Your Honor. Haggar arose when Congress passed a 9 particular provision of the tariff schedule that left a 10 gap to be filled, and they delegated that filling of the 11 gap, specific gap to the customs service. It was matters 12 incidental to assembly outside of the United States, and 13 it listed such as, it left obvious gaps for filling. 14 They went, and on a notice and comment basis, 15 had a regulation promulgated that furthered that 16 definition. I don't view it as interpretive. I view it 17 as legislative, and that's what the customs service did, 18 and this Court found that that created normal law similar 19 to a statute. That -- 20 QUESTION: Why didn't that constrain or modify 21 or elaborate the term, de novo, in the Court of 22 International Trade's jurisdictional standards, just as 23 much as this case does? 24 MR. COLL: It impacted it in a slightly 25 different fashion. It impacted it in that there was no 40 1 interpretation left of the law. the statute, or the -- 2 it -- the promulgation of the regulation, notice and 3 comment regulation now told us, this is what is or isn't 4 incidental. 5 Now we had -- the question that remained was 6 what had occurred outside of the United States, and did 7 that fall within that language, so that now we were 8 focused, as I understand this Court's direction, on that 9 fact, what was happening outside the United States, and 10 does it fit into that articulated definition in the 11 regulation. 12 QUESTION: Mr. Coll, let me approach this from a 13 different vantage point. If we decide that we do owe 14 Chevron deference to the position taken by the customs 15 service in this case, do you lose? Is that the end of the 16 matter? 17 MR. COLL: No, because -- 18 QUESTION: Why not? 19 MR. COLL: I would take the position that the 20 interpretation at first blush and upon further analysis is 21 unreasonable. 22 QUESTION: Do you think the word bound is open 23 to different interpretations as to what's bound? 24 MR. COLL: Yes. 25 QUESTION: And so is it open at all to the 41 1 agency to decide that it includes these ring binders as 2 being bound? I mean, that would be one possible 3 interpretation. 4 MR. COLL: That's one possible interpretation, 5 and the question then becomes whether or not -- 6 QUESTION: So I would have thought, then, if you 7 apply Chevron deference that's the end of the case for 8 you. 9 MR. COLL: Well, their interpretation is 10 predicated upon one provision, an explanatory note that 11 isn't applicable at that level of the tariff schedule, 12 which doesn't relate to whether or not things are bound. 13 It relates to what things are made of. 14 The schedule, this particular provision, this 15 particular chapter, 4820, relates to paper, and what this 16 explanatory note says, if things come with packaging that 17 has metal, leather, et cetera, they will still be 18 classified as paper that the other substance, the other 19 material will not predominate. Everything here in 4820 20 has to be held together in some fashion, because the 21 chapter note says that these -- this provision does not 22 cover loose sheets, so everything has to be -- 23 QUESTION: Mr. Coll, there's one piece of this, 24 before we get to the application of it, that I find vastly 25 puzzling. Maybe there's an easy answer to it. 42 1 You talked about the provision that says, de 2 novo review, but then you quickly said, and yes, there's a 3 presumption of correctness. Those two seem to be at 4 loggerheads. Why are they not? 5 You told me that the facts found by customs get 6 a presumption of correctness. On the other hand, the 7 facts are gone over de novo. 8 MR. COLL: It's a burden-of-proof issue, Your 9 Honor. It's a matter that because there's a presumption 10 of correctness, then the burden is slightly different on 11 the plaintiff, the importer, than it might otherwise be, 12 that he has a presumption that is working against him, and 13 it's a burden of proof. It doesn't relate to deference. 14 But focusing on chapter 4820 and why this is not 15 appropriate interpretation and would be unreasonable even 16 under Chevron, though we don't believe Chevron applies, 17 the statute is fairly clear. The statute tells us that 18 there are diaries, and there are similar articles, and 19 then breaks it down further to diaries bound in all these 20 other items that would be similar articles. 21 QUESTION: Well, but I had a little difficulty 22 with your argument there. If you turn to pages 17 and 18 23 of your brief, on page 18 you make that argument. You 24 say, in effect, diaries bound is to be contrasted with 25 other, and one reason that you say that a diary does not 43 1 fall -- one reason that you say that this does not fall 2 within the diary category is that it's not adapted for 3 exhaustive recording of past events. It's a schedule. 4 But in the statute itself, which you quote on 5 the preceding page, on 17, there is the term in 6 4820.10.20, which you quote only with ellipsis, and that 7 term refers to diaries. It also refers to notebooks and 8 address books, bound, which does not seem to carry the 9 same connotation. The notebooks and address books don't 10 seem to carry any connotation one way or the other with 11 respect to either recording past events or noting future 12 schedules. 13 If we don't engage in the ellipsis that you did 14 and we refer to these other examples as having some 15 bearing on what a diary is, your argument is considerably 16 weaker, isn't it? 17 MR. COLL: Well, I'm going to have to defer at 18 this point in time to customs practitioners, who tell me 19 that you cannot look in a classification as to this 20 product at those other two, either by way of combination, 21 because that isn't the way the law gets interpreted in 22 combination products that exist elsewhere, so -- 23 QUESTION: Well, but I assume that they're not 24 intending to -- you know, to exclude the interpretive 25 rule, you know, noscitur a sociis. We sort of know each 44 1 term by those associated with it, and if that interpretive 2 canon applies, then there isn't a simple contrast between 3 diaries and others. There's a contrast between diaries, 4 notebooks, and address books and others, and notebooks and 5 address books and others do not have the kind of 6 connotation that you want us to read so clearly into 7 diary. 8 MR. COLL: Well, I think that we have to start 9 at the top, because that's what the chapter notes tell us. 10 The chapter notes tell us -- and the chapter notes are 11 statutory, and the chapter notes tell us that we have to 12 start at 4820. We can't start at 4820.10.20, or at 13 4810.40. We have to start at the top, and our argument is 14 centered on the fact that it's diaries and similar 15 articles. 16 QUESTION: I understand your point there 17 perfectly well, but by the same token we can't ignore 18 48 -- 4820.10.20, either, and it seems to me that as the 19 statute becomes progressively more detailed, it becomes 20 progressively more indicative of what it may have in mind 21 by similar articles, and it seems to me that by the 22 ellipsis as you quote 4810.20 on page 18, you are in 23 effect telling us to ignore whatever interpretive value 24 there might be to considering notebooks and address books, 25 and that does have some interpretive value, because 45 1 notebooks and address books do not have a connotation of 2 time past, time future, in the sense that your argument 3 assumes. 4 MR. COLL: But we weren't classified as an 5 address book, and we weren't classified as a notebook. We 6 were classified as a bound diary, and the other two cannot 7 support this classification. This classification was very 8 simply made and very simply stated. It doesn't say -- 9 QUESTION: So your point is, we ignore them. 10 MR. COLL: We -- yes. 11 If the Court has no further questions -- 12 QUESTION: I -- ask you again about the statute 13 that's quoted at page 3 of the Government's brief, which, 14 as I understand it, indicates that if a proposed 15 interpretive ruling modifies an earlier ruling, there has 16 to be publication in the Customs Bulletin. 17 MR. COLL: Correct. 18 QUESTION: Now, that is inapplicable to the case 19 before us? 20 MR. COLL: Right. That was part of what they 21 refer in the Customs Bar as the Mod Act. It was not in 22 effect at the time that we were -- this ruling came down. 23 There's a second feature out there that relates 24 to -- 25 QUESTION: Do you think that this statute would 46 1 be very important in another case, insofar as whether or 2 not these rulings are -- should be accorded Chevron 3 deference because they're very much like a regulation, or 4 do you think both cases, a case arising under this statute 5 and your case, should be dealt with the same? 6 MR. COLL: I think it enhances part of their 7 argument. It does not enhance their whole case, because I 8 believe that it does not enhance the particular point, 9 which is that these are conclusions of fact and law as to 10 which one cannot dissect neatly those interpretive legal 11 norms that would be required for Chevron deference. 12 But in terms of process, in terms of notice, in 13 terms of procedural regularity, it certainly is better 14 than receiving a letter in the mail 2 years after you've 15 gotten a classification ruling telling you that the 16 classification ruling no longer is effective. 17 QUESTION: Thank you, Mr. Coll. 18 QUESTION: Actually, if you have an extra 19 minute, if it's all right I'd like to go back for 1 second 20 on the word determinations. 21 MR. COLL: Yes. 22 QUESTION: The Government has also argued, and I 23 wondered about this, I want to -- that really we decided 24 in Haggar that that word determinations must refer only to 25 factual and not legal determinations. I'd like to know 47 1 your response to that. 2 MR. COLL: As I read the Haggar decision, there 3 was an argument made at that time that Haggar, or the 4 class -- the regulation at issue in Haggar was not 5 entitled to Chevron deference. It was not entitled to any 6 deference because of de novo review. 7 We have a legislative regulation there and as I 8 understand the Court, the Court was trying to explain how 9 those two elements, a statutory regulation that creates a 10 legal norm, would -- could still be harmonized with the de 11 novo review feature, and used as an example there that 12 could still be applied to the facts. 13 We don't have that neat dissection. One can't 14 surgically pull out the interpretive law from the fact in 15 these types of classification rules. 16 QUESTION: Thank you, Mr. Coll. 17 Mr. Jones, you have 2 minutes remaining. 18 REBUTTAL ARGUMENT OF KENT L. JONES 19 ON BEHALF OF THE PETITIONER 20 MR. JONES: Thank you. I think I have two 21 points. 22 Justice Breyer, as we understand the issue that 23 you've been addressing, the Court expressly confronted and 24 resolved it in the Haggar case. The Court quoted the same 25 provision of the statute that you're quoting and said that 48 1 the responsibility of the Court of International Trade to 2 make its determinations on the record before it, meant 3 that it was to assemble the record and make factual 4 determinations and apply those facts to the law, but in -- 5 the Court said that deference can be given to the 6 regulations without impairing the authority of the court 7 to make factual determinations and to apply those 8 determinations to the law de novo. 9 And what the Court said in Haggar was that the 10 regulations, the interpretive regulations of the agency 11 were part of the law that the Court of International Trade 12 was to apply, which is our position precisely in this 13 case. 14 I believe that -- I want to say one more thing 15 about this deliberative conclusion point. Now, the cases 16 that have described, that you look to the deliberative 17 conclusion to find -- in the interpretive ruling to decide 18 whether to give deference to the agency's reasonable 19 conclusions, involve rulings in particular. 20 In Martin v. OSHRC, Occupational Safety & Health 21 Review Commission, the Court applied the same principle of 22 Chevron deference to an agency's citation when the 23 citation had been issued in the -- precisely in the format 24 that Congress authorized for interpretive purposes, so I 25 think you may need to look to the nature of the regulatory 49 1 ruling -- rulemaking program to decide, you know, what 2 sort of specificity is required. 3 But in the context of the customs service 4 rulings, I think as a practical matter you're going to be 5 looking at headquarters rulings that contain the 6 deliberative analysis to find out what the agency's 7 reasonable interpretation is. 8 CHIEF JUSTICE REHNQUIST: Thank you, Mr. Jones. 9 The case is submitted. 10 (Whereupon, at 11:00 a.m., the case in the 11 above-entitled matter was submitted.) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 50