[00:00:00] Speaker 01: The next case for argument is 24.1436 Nutrition, North America versus United States. [00:00:06] Speaker 01: Good morning, Ms. [00:00:10] Speaker 01: Berman. [00:00:10] Speaker 00: Good morning. [00:00:11] Speaker 00: Please proceed. [00:00:12] Speaker 00: Good morning, Your Honors. [00:00:14] Speaker 00: Amanda Berman from Nutrition. [00:00:17] Speaker 00: At issue here is whether medical foods made in labs by pharmaceutical companies and prescribed by doctors to treat very ill children enter the country duty-free as medicaments for therapeutic use [00:00:29] Speaker 00: or are subject to steep tariffs as foods not elsewhere specified or included? [00:00:34] Speaker 00: Your Honor, the right answer to that question is the common sense one. [00:00:39] Speaker 00: Medical foods, despite that food nomenclature, are medicaments described in 30.03 and 0.04 because they're used to treat diseases. [00:00:48] Speaker 00: And they're not like the foods that are covered [00:00:50] Speaker 00: by 2106 and other headings in section four. [00:00:54] Speaker 01: Did the Court of International Trade judge and the government concede that your products come under medicaments and then just go to 1A and say that the exclusion takes them out, or is there dispute whether they came under the medicaments? [00:01:08] Speaker 00: Your Honor, I don't think the government has disputed that they fall under 30-04 under the broad-term medicaments for therapeutic use. [00:01:15] Speaker 00: It's basically said that in several places. [00:01:17] Speaker 00: The government and the district court, and we think they erred in this regard, they skipped that question, essentially. [00:01:22] Speaker 00: And they went right to note 1A. [00:01:25] Speaker 00: The district court never even conceded that they do fall within 30-04. [00:01:28] Speaker 00: And under this court's decision in Sharp, that alone was error, Your Honors. [00:01:33] Speaker 00: We do want to highlight that they fall under that broad term. [00:01:36] Speaker 00: But it's also important to note, Your Honor. [00:01:38] Speaker 01: But that doesn't matter, right? [00:01:39] Speaker 01: I mean, even if they, assuming they fell into the broad term, then we have, we then have to go to 1A and say that they're excluded under 1A. [00:01:47] Speaker 00: Your Honor, we agree that you do have to look at 1A and say whether they meet that exclusion. [00:01:51] Speaker 00: And I'm happy to jump right to that. [00:01:53] Speaker 02: But you do make a kind of methodological point. [00:02:00] Speaker 02: What is it about your wanting to start with a provisional conclusion that the medicament applies before getting to note 1A, changes the standard or something about how to interpret note 1A? [00:02:23] Speaker 02: It sounds like you were making an argument that if it seems like it's within the provision without, before you get to the note, then there's an extra burden for something to get to a place where you would read the note to subtract from that. [00:02:43] Speaker 02: Is that the kind of point you're making? [00:02:45] Speaker 00: Your Honor, we think it's important to start with the heading because, as I'll get to in a minute, [00:02:50] Speaker 00: where there are arguably competing exclusionary notes, or where there's ambiguity as to whether something falls within an exclusion, this court's case law in Bauer and LeMond says that we need to look at the heading and apply the more specifically askable heading. [00:03:05] Speaker 00: So that's where we think we are here. [00:03:06] Speaker 00: But if you just take note 1A on its terms, Your Honor, we do not fall within the terms of that note. [00:03:13] Speaker 00: Medical foods are not included in that text. [00:03:16] Speaker 00: We have a list of things and examples, diabetic foods, [00:03:20] Speaker 00: First, those are foods from which sugar has been removed, fortified foods, food supplements, tonic and mineral waters, and then we have this term dietetic, which is where a lot of the fight is. [00:03:32] Speaker 01: I know there's a lot of fight there, but what bothers me more is that it says other than nutritional preparations for intravenous administration, because you agree your product is a nutritional preparation, right? [00:03:47] Speaker 01: Yes, Your Honor. [00:03:48] Speaker 01: So why really get its entirety, if you just take that phrase, that the only nutritional preparations that we're going to allow are for intravenous administration? [00:04:01] Speaker 01: Why isn't that a strong argument against your position? [00:04:04] Speaker 00: Your Honor, I think it's notable that the government's walked away from this argument, because that would be an exception that eats much of the headache, Your Honor. [00:04:12] Speaker 00: To read that as saying that anything nutritional, unless it's intravenous, [00:04:16] Speaker 00: is excluded from this heading would mean a lot of things are not covered by that. [00:04:21] Speaker 00: And it's contrary to the terms of Note 1F to 2106, which specifically says that this chapter does not cover yeast put up as a medicament or other products of heading 3003 or 3004. [00:04:34] Speaker 00: Under that understanding, yeast would have to be intravenously injected to qualify under 3003 or 3004. [00:04:41] Speaker 00: And as we tried to walk through in a brief history of that phrase at the end of the exclusion, [00:04:46] Speaker 00: It was an add-on. [00:04:47] Speaker 00: It was to make sure a specific thing is excluded. [00:04:50] Speaker 00: It wasn't to broaden the whole scope of the exclusion. [00:04:53] Speaker 00: And so I do think, you know, we look at this list of terms, and let's take the government's own definition of what dietetic means. [00:05:00] Speaker 00: The government uses the definition of food adapted for special use. [00:05:04] Speaker 00: Your Honor, these are not adapted foods. [00:05:06] Speaker 00: They are made in labs. [00:05:08] Speaker 00: They are marketed to doctors. [00:05:10] Speaker 00: They are part of the pharmaceutical supply chain. [00:05:12] Speaker 02: What do you think the word adapted means? [00:05:15] Speaker 02: You take an apple and do something to it? [00:05:18] Speaker 00: Well, Your Honor, looking at, for example, diabetic foods as it do some generis things in the same category, foods from which sugar has been removed or something has been removed, that's not what these are. [00:05:27] Speaker 00: Despite that medical foods nomenclature, they're nothing like foods. [00:05:31] Speaker 00: They're a combination of amino acids, at least for three of the four products, [00:05:35] Speaker 00: They're specially manufactured, compounded in a lab. [00:05:38] Speaker 00: There's nothing food-like about them. [00:05:39] Speaker 00: They're not bred with something or good. [00:05:41] Speaker 02: So I think I got all of that. [00:05:43] Speaker 02: I want to ask you to focus just on the word adapted. [00:05:46] Speaker 02: What do you think the word adapted means? [00:05:49] Speaker 00: Change your honor. [00:05:50] Speaker 00: Let's take a simple dictionary definition. [00:05:52] Speaker 02: I don't start with a normal food and change it as opposed to start with Individualized components that you will find in food and create a new product with them. [00:06:05] Speaker 02: Is that the distinction? [00:06:06] Speaker 00: Yes, your honor. [00:06:06] Speaker 00: That is the distinction we think [00:06:08] Speaker 01: I'm sorry to interrupt, but the argument you're making now is based on what the product is. [00:06:14] Speaker 01: And I thought a big, a large chunk of your brief and your argument is we're not looking at that. [00:06:19] Speaker 01: We look at the use. [00:06:21] Speaker 01: So what are you saying here? [00:06:23] Speaker 00: Well, Your Honor, and that goes back to why it's important to start with those heading terms. [00:06:26] Speaker 00: As is Court Hall and Warner Lambert, 30.04 is a used provision. [00:06:30] Speaker 00: And the use is medicments for therapeutic use. [00:06:33] Speaker 00: And it's not disputed that these are used [00:06:35] Speaker 00: solely to treat [00:06:51] Speaker 00: And in that circumstance, this is where the explanatory notes can come in helpful. [00:06:55] Speaker 02: So I guess I was a little confused about this. [00:06:59] Speaker 02: Just tell me why what I'm about to say is wrong. [00:07:03] Speaker 02: The exclusionary note in chapter 21 says, we don't apply if chapter 30 applies. [00:07:11] Speaker 02: So as far as I can tell, [00:07:15] Speaker 02: We're done talking about chapter 21. [00:07:17] Speaker 02: The only question is whether chapter 30 applies. [00:07:20] Speaker 02: If it does, then the exclusionary note on chapter 21 says we don't apply. [00:07:24] Speaker 02: If chapter 30 doesn't, then subject putting aside chapter 98, 21 applies. [00:07:30] Speaker 02: So I don't see the competition. [00:07:35] Speaker 00: Sure, Your Honor. [00:07:35] Speaker 00: I think they are competing notes, because there's another phrase in note 21f. [00:07:42] Speaker 00: does not cover yeast put up as a medicament or other products of Heading 2004. [00:07:46] Speaker 00: I think that example, yeast put up as a medicament, is fatal to the government's case. [00:07:50] Speaker 00: Yeast is actually specifically identified in Section 4. [00:07:54] Speaker 00: It's got its own heading. [00:07:56] Speaker 00: But this is telling us when it's put up as a medicament, when it's used for therapeutic use, then it goes in 30 and 4. [00:08:02] Speaker 00: And that is the line we see drawn here. [00:08:04] Speaker 00: So I do think we have competing notes in the sense [00:08:07] Speaker 00: Note 1A does not say medical foods. [00:08:09] Speaker 00: It does not specifically cover them by name. [00:08:12] Speaker 00: It's ambiguous. [00:08:13] Speaker 00: Dietetic is what we're looking at. [00:08:15] Speaker 00: Does that include? [00:08:16] Speaker 00: So we have these competing notes. [00:08:18] Speaker 00: We also, you know, we need a time rigor here. [00:08:20] Speaker 00: Let's look at section six, note two, which says if something is classifiable under 30-04, then it can't be classified under any other heading. [00:08:30] Speaker 00: So, Your Honor, why I think we... I'm sorry, that was what? [00:08:33] Speaker 00: Section six, note two. [00:08:36] Speaker 00: So that's another relative note under GRI 1 that applies here when we're interpreting 30.04. [00:08:42] Speaker 00: So we've got those two notes on our end. [00:08:44] Speaker 00: And this is where I think tools like these explanatory notes really do come in helpful, Your Honor. [00:08:49] Speaker 00: And if you look at the explanatory note 21 to 21.06, as well as to 30.04, they both draw the same line. [00:08:57] Speaker 00: So 21.06, for example, notes that this heading covers food preparations, often referred to as supplements, [00:09:04] Speaker 00: based on extracts from plants, etc. [00:09:08] Speaker 00: It does not cover similar preparations intended for the prevention or treatment of diseases or ailments. [00:09:14] Speaker 00: We see the same line drawn in note 3004, explanatory note 3004. [00:09:20] Speaker 00: There's a line that says, but have no indication as to the use for the prevention or treatment of any disease or ailments. [00:09:26] Speaker 00: And it's describing what's excluded. [00:09:28] Speaker 00: It's only excluded if it has no use for the treatment of disease. [00:09:32] Speaker 00: These are only used to treat diseases, Your Honor. [00:09:34] Speaker 01: But what about going back to note 1A, where it uses the term dietetic or diabetic? [00:09:41] Speaker 01: I mean, would there be anything that you think is fairly construed as dietetic or diabetic that would also be intended for prevention or treatment of diseases? [00:09:56] Speaker 01: You know, if you're trying to fight diabetes, so you do whatever you do to your diet to do it, that could be intended for prevention of diseases, right? [00:10:05] Speaker 00: Well, Your Honor, so insulin, yes. [00:10:07] Speaker 00: Insulin would be a medicine. [00:10:09] Speaker 00: It's not a diabetic food. [00:10:10] Speaker 00: Diabetic food, we think there, and we set in some definitions from the Mayo Clinic, that's foods used to support a healthy diet for a diabetic person. [00:10:18] Speaker 00: You can find those in a supermarket. [00:10:19] Speaker 00: You can find those in a drugstore. [00:10:21] Speaker 00: Those are a very different type of product. [00:10:23] Speaker 01: But those aren't, read broadly, intended for the prevention of diseases? [00:10:29] Speaker 00: Your Honor, no. [00:10:30] Speaker 00: They're not treating the disease. [00:10:32] Speaker 01: It doesn't say they're not treating, but it says prevention or treatment of diseases. [00:10:39] Speaker 01: So forget treatment of diseases. [00:10:41] Speaker 01: I'm talking about prevention of diseases. [00:10:43] Speaker 00: Your Honor, I don't think diabetic foods prevent the disease. [00:10:46] Speaker 00: Diabetic foods, as I understand them, are used for somebody who has diabetes and needs a diet that's low in sugar. [00:10:52] Speaker 00: So you can find products in your supermarket that have those qualities. [00:10:55] Speaker 00: They are foods that are adapted for a particular health benefit. [00:10:59] Speaker 00: And Your Honor, I mean, I think this gets back to the distinction this court drew in the Warner-Lambert case, where it said, OK, vitamin C drops. [00:11:06] Speaker 00: They do fall under the basket provision. [00:11:08] Speaker 00: And 2106 is a basket provision. [00:11:10] Speaker 00: because they're not being used to treat scurvy. [00:11:13] Speaker 00: The court was very clear that if they were being used to treat scurvy, then they would fall under the medical headache, but they weren't being used to treat scurvy. [00:11:19] Speaker 00: They were used for general wellness. [00:11:20] Speaker 01: Your case never analyzed 1A, right? [00:11:22] Speaker 01: No, it did not analyze that. [00:11:24] Speaker 01: In fairness, if those arguments were not, if that was not a dispute there, I'm not sure how much we could take from order. [00:11:31] Speaker 00: Well, Your Honor, it's the line that I think we see drawn throughout the explanatory notes and drawn throughout [00:11:37] Speaker 00: All the notes we're talking about is a used to treat disease. [00:11:40] Speaker 00: And that is why the heading is important. [00:11:42] Speaker 00: This is a used heading. [00:11:43] Speaker 00: We should apply the carbon. [00:11:45] Speaker 02: I think you can tell from some of the questioning that there's a certain, well, at least in my mind, I'm looking for something more precise and concrete about the line. [00:11:59] Speaker 02: I keep thinking of products that have been [00:12:03] Speaker 02: altered so that a disease won't flare up, won't lead to terrible symptoms by taking the gluten out of bread or something like that. [00:12:19] Speaker 02: The disease is not going away, but the manifestations can be avoided or diminished or something. [00:12:28] Speaker 02: Tell me what, by the language, [00:12:31] Speaker 02: is different about that than your medical foods? [00:12:39] Speaker 00: Your Honor, what is different is the medical foods, unlike that sort of product, are used as treatment for disease, for example, to give. [00:12:47] Speaker 02: So just again, some of these words keep getting used in ways that immediately in my mind trigger, boy, I need to know more of what you mean by that. [00:12:58] Speaker 02: Is treatment of disease, does that include [00:13:01] Speaker 02: giving nutrients in such a way that an underlying disease, which will be chronic, doesn't manifest in bad symptoms. [00:13:10] Speaker 00: Yes, Your Honor, it does. [00:13:11] Speaker 00: So an example here, KetoCal, used for treating intractable epilepsy. [00:13:16] Speaker 00: It has, as I understand it, almost an immediate effect sometimes. [00:13:20] Speaker 00: You start taking KetoCal, the epilepsy seizures lessen or go away. [00:13:24] Speaker 00: So it is being used to treat the disease. [00:13:26] Speaker 00: It doesn't make it go away. [00:13:27] Speaker 00: It doesn't heal or cure. [00:13:28] Speaker 02: So why is that different from, I don't know, taking the gluten out of bread for somebody who is allergic to gluten or something like that? [00:13:40] Speaker 00: Because, Your Honor, that is an adaptive food. [00:13:42] Speaker 00: And so I think that is closer to or crosses the line that's being drawn by No. [00:13:46] Speaker 00: 1A. [00:13:47] Speaker 00: But I would prefer, you know, I think the reason that in my view, nutrition should prevail here comes down to three simple things. [00:13:53] Speaker 00: Everyone agrees medical foods fall within the terms of the heading 30-04. [00:13:58] Speaker 00: They are not clearly or unambiguously excluded under Note 1A. [00:14:01] Speaker 00: It doesn't say that. [00:14:02] Speaker 00: We've got an unclear and scoped note. [00:14:05] Speaker 00: They are therefore at least classifiable under 30-04. [00:14:09] Speaker 00: And we have several things, including this court's decision telling us in Bauer that they are classifiable. [00:14:15] Speaker 00: under a more specific heading, that's where they should be classified. [00:14:19] Speaker 02: The way you just structured that seems to me to rely on the methodological point that we were talking about way at the beginning. [00:14:27] Speaker 02: In your view, if something looks like it's within the terms of the heading, in order for the note to take it out, it has to meet a kind of clear statement rule. [00:14:43] Speaker 02: Where have we said that? [00:14:44] Speaker 00: You're in Bower, Your Honor. [00:14:46] Speaker 00: So I would point you to footnote six in Bower where it said, let me find this really quickly. [00:14:53] Speaker 00: I know we're running out of time here. [00:14:54] Speaker 00: My apologies. [00:14:55] Speaker 00: I think this language is pretty on point. [00:14:58] Speaker 00: Assuming the subject merchandise is prima facie classifiable under both chapters 62 or 95, that's what we have here. [00:15:07] Speaker 00: Each chapter has associated with it an exclusionary note that would ordinarily preclude classification of the merchandise under the competing chapter. [00:15:15] Speaker 00: Then it describes these two notes. [00:15:16] Speaker 00: They're not perfectly parallel. [00:15:18] Speaker 00: They're actually very similar to what we have here. [00:15:20] Speaker 00: One identifies specific things, sports equipment. [00:15:22] Speaker 00: The other just says, not things in the other heading. [00:15:25] Speaker 00: And so what the court says is, under that circumstance, we must evaluate which heading provides the more specific description of the merchandise. [00:15:33] Speaker 00: Here we have a heading, 30 or 4, that provides us various information. [00:15:37] Speaker 02: I apologize for not having Bauer freshly in my mind. [00:15:40] Speaker 02: Was that one where each of the two chapters had a note saying, we don't apply when the other one does? [00:15:48] Speaker 02: That doesn't feel like what we're talking about when we're talking about the relationship between note 1A and the heading. [00:15:56] Speaker 02: in 30 point whatever. [00:16:02] Speaker 02: You want to say when you read the heading and read those words, medical foods are included, you need a really special clear statement to use a general legal methodological term in note 1A to alter that conclusion. [00:16:19] Speaker 02: I think the government's position is no you don't. [00:16:22] Speaker 02: Note 1A and the heading words [00:16:24] Speaker 02: are completely parallel, and whatever is in note 1A is outside that heading by definition. [00:16:30] Speaker 02: So just answer the question, what is within note 1A? [00:16:35] Speaker 02: And in particular, what's dietetic? [00:16:38] Speaker 00: Adapted foods, foods that have been changed. [00:16:40] Speaker 00: This is not bread with something removed. [00:16:42] Speaker 00: This is a chemical manufactured compound in pharmaceutical companies, sold through the medical pipeline, covered by insurance, [00:16:50] Speaker 00: At the end of the day, you're out of these cases. [00:16:53] Speaker 00: The line I see through them is the court ultimately asks, what is this more like? [00:16:56] Speaker 00: This is much more like medicine, which is an analogous term than it is like food in any traditional sense. [00:17:02] Speaker 03: Just very quickly, on your alternative argument chapter 98, I just want to understand, is it truly an alternative? [00:17:09] Speaker 03: Could you prevail in theory under oath, or are they mutually exclusive? [00:17:14] Speaker 03: If you're okay under 30 or 4, then you're not okay under 98, 17, and vice versa, or do I misunderstand? [00:17:22] Speaker 00: It is a secondary heading that we think applies, so we think it's also or alternatively. [00:17:28] Speaker 03: It's possible that you could be correctly categorized under both of those? [00:17:31] Speaker 00: Yes, because it is specifically a secondary heading. [00:17:34] Speaker 02: Just clarify, what does that mean, the word secondary heading? [00:17:39] Speaker 00: As I understand it, and I am not a day-to-day trade lawyer, this is one of the few headings that can be listed alongside or after you've identified another heading and then will give a duty-free treatment despite what other heading applies. [00:17:51] Speaker 00: It's a secondary heading. [00:17:53] Speaker 00: It's a special tariff treatment given to certain classes of goods for good purposes like here under the Nairobi Protocol to help handicap persons. [00:18:01] Speaker 02: Is there any real-world practical reason that [00:18:08] Speaker 02: choosing either the chapter 98 or the chapter 30, that one of those is more clarifying for the industry or some other reason that one might choose which to apply. [00:18:26] Speaker 00: Your Honor, we do think that it is important to clarify that the terms of 30-04, this broad phrase, MediCments for Therapeutic Use, [00:18:36] Speaker 00: do include these types of products. [00:18:38] Speaker 00: There are more of these products out there. [00:18:40] Speaker 00: There are other manufacturers. [00:18:41] Speaker 00: So we do think it is important for that purpose to not have to rely solely on the exception for goods used by handicapped people. [00:18:48] Speaker 02: And the chapter 98 point requires the endorsement of a somewhat artificially narrow interpretation of the word therapeutic, right? [00:19:02] Speaker 02: Well, Your Honor, it's just the interpretation. [00:19:04] Speaker 02: I do need to be a little bit disparaging. [00:19:06] Speaker 02: There's some authority for that. [00:19:07] Speaker 00: Yes. [00:19:07] Speaker 00: But it's the interpretation articulated in Richard's medical, which is for this purpose only. [00:19:12] Speaker 00: Therapeutic means it's a narrower meaning, so long as it doesn't heal or cure. [00:19:20] Speaker 00: Thank you, Your Honor. [00:19:20] Speaker 00: Thank you. [00:19:21] Speaker 01: What do you say something about that, Tom? [00:19:22] Speaker 01: Let's hear it again. [00:19:34] Speaker 04: Morning, Your Honors. [00:19:35] Speaker 04: Nutritious medical foods are dietetic foods, or at least foods that are similar to dietetic foods that are excluded from classification as an indifference of Heading 30-04. [00:19:45] Speaker 04: And because they're undisputedly therapeutic, they're likewise excluded from Heading 98-17, an Ayurvedic protocol provision, which excludes therapeutic art. [00:19:59] Speaker 04: we've conceded quite as much as Ms. [00:20:01] Speaker 04: Berman has said that we have. [00:20:03] Speaker 04: We don't concede that the word medicaments would cover these products. [00:20:07] Speaker 04: As we explained below, medicaments implies some sort of medicinal agents, like an active ingredient, something along those lines. [00:20:15] Speaker 04: And Nutricia has said throughout this case that these products are at least conceded in interrogatory responses, that these products don't have any active pharmaceutical ingredient. [00:20:24] Speaker 01: You do not dispute that they're used for treatment. [00:20:27] Speaker 04: Of course, we don't dispute that. [00:20:28] Speaker 04: They're nutritional therapies. [00:20:30] Speaker 04: And just because they're nutritional therapies doesn't mean that we read out the litigaments or that we read out, you know, 1A to chapter 30. [00:20:37] Speaker 04: And on that last point, you know, I understand that Trisha's position would be the same if note 1A to chapter 30 said that it excluded foods and beverages such as neocate, msutumoflex, et cetera, all the products that are in this case. [00:20:51] Speaker 01: Life is never that simple. [00:20:53] Speaker 04: I wouldn't have a job if it were, because it would be much easier to classify things. [00:20:57] Speaker 04: But their understanding of Bauer and the notes being mutually exclusive, my understanding is that that would be the same position if even the note were specific to these products. [00:21:07] Speaker 04: That can't be the case. [00:21:09] Speaker 04: Our understanding of dietetic is that it's a food that has been specially formulated for the management or treatment of a particular condition. [00:21:16] Speaker 04: And a prime example of that is a diabetic food, which is treated separately from dietetic and the tariff. [00:21:21] Speaker 04: But diabetic foods, yes, they remove sugar. [00:21:24] Speaker 04: They remove the sorts of things that could be a problem for someone with diabetes. [00:21:28] Speaker 04: Dietetic foods do the same thing. [00:21:30] Speaker 04: Dietetic foods like neocate, they remove whole proteins from the mix and replace them with amino acids. [00:21:37] Speaker 04: So just like removing sugar or removing gluten from a food, particular nutrients are removed and replaced with others for either [00:21:45] Speaker 04: complete nutrition in a child or nearly complete nutrition, as a nutrition expert put it? [00:21:51] Speaker 02: It does seem close to the center of nutrition's argument to want to distinguish two things. [00:21:59] Speaker 02: One, taking a normal-use food and altering it. [00:22:04] Speaker 02: And on the other hand, starting with a bunch of [00:22:09] Speaker 02: amino acids, proteins, creating something that had never existed before, doesn't look like an apple or any other normal food. [00:22:19] Speaker 02: What's your response to that being, and doing it for the purpose, very specifically for the purpose of treating very specific diseases? [00:22:29] Speaker 04: Right, I don't think that's a distinction that could matter in this case. [00:22:32] Speaker 04: I think mainly because there's nothing in the text of 1A to suggest that the manner of preparation matters. [00:22:38] Speaker 04: So some sort of Frankenstein food or a Soylent Green or something that's being cooked up in a lab, I don't think it makes a difference how it's being made. [00:22:47] Speaker 04: Obviously, the fact that it's being made in the lab, it's being made. [00:22:50] Speaker 02: Does it make any difference for purposes of qualification under the FDA statute and regulation for what constitutes a medical food? [00:23:02] Speaker 04: It very well might, yes. [00:23:03] Speaker 04: I believe it would. [00:23:04] Speaker 04: I'm not as up to speed on all the various regulations that go into that, but yes, there's a different [00:23:10] Speaker 04: different list of requirements that medical foods must meet to be branded as medical foods. [00:23:16] Speaker 02: Is it right or not right to say that this case has been presented to us as involving the question whether medical foods under the FDA regime come within 30.06, 404? [00:23:36] Speaker 04: You know, I think it's certainly been presented that way. [00:23:40] Speaker 02: I don't think they made it like that. [00:23:41] Speaker 02: And there's been no argument. [00:23:43] Speaker 02: also tell me if this is right, that differentiates among any of these five products. [00:23:48] Speaker 02: Everybody is presenting to this as either all five products are in one place or all five products are in another place. [00:23:55] Speaker 02: But there are obviously some distinctions. [00:23:58] Speaker 02: And I think, at least in the trial court, you made some points about some of the distinctions, but I think not an argument that said two of them are in this and three of them are in the other. [00:24:11] Speaker 04: That's correct. [00:24:13] Speaker 04: gone with all products, and we treated the same. [00:24:15] Speaker 04: For the trial court, we distinguished the OK on some grounds, but I don't think that that's important. [00:24:20] Speaker 04: Obviously, we haven't briefed that, so it's not something. [00:24:22] Speaker 02: And if we thought that the question to be answered, because it's how it was framed, was whether medical foods within the FDA law, meaning come within 30.04, how would that change the analysis [00:24:41] Speaker 02: that you're presenting. [00:24:43] Speaker 04: I don't think you would change the analysis at all, because our position is that the FDA's understanding or this definition of what a medical food is is essentially the same as what's covered by a dietetic food, at least partly. [00:24:52] Speaker 04: Dietetic is a broader term that's going to cover a bunch of other things, too. [00:24:55] Speaker 02: Does dietetic cover diabetic? [00:24:59] Speaker 04: It's an interesting point. [00:25:01] Speaker 04: I think it would, the broadest understanding of dietetic, a food that's been formulated especially in that case for the management of diabetes. [00:25:09] Speaker 04: There is a different FDA regime, as I understand it, for diabetic foods specifically. [00:25:13] Speaker 04: And the Canadian International Trade Tribunal made the same point in distinguishing that dietetic must be meaning something else other than diabetic. [00:25:20] Speaker 04: So I think our frontline position there would be that dietetic. [00:25:23] Speaker 04: It would include that. [00:25:25] Speaker 04: And it's including dietetic, presumably specifically because that's a well-known article of commerce. [00:25:29] Speaker 04: And so that's something that. [00:25:30] Speaker 02: And are you giving dietetic a meaning that is, I guess, [00:25:38] Speaker 02: follows not the Latin phrase that the other side has used, but a very similar Latin phrase, the gnosis sceptor. [00:25:48] Speaker 02: phrase that is you have a list that is we don't have something where there's a general term either at the front or the back and then specific examples I think that's the Latin phrase Canon that is invoked which I think is not quite the right one but the other one is when you have a list of things treat them it's particularly with a such as in front of it treat those terms as much as possible as akin to each other and [00:26:13] Speaker 04: Right, right, illustrative, non-exhaustive, and treatment in the same sort of category. [00:26:19] Speaker 02: Yeah. [00:26:20] Speaker 04: Exactly. [00:26:20] Speaker 02: So are you giving dietetic that kind of, you know, that kind of meaning as focused as the word diabetic? [00:26:31] Speaker 02: I kind of thought you were giving dietetic a pretty broad meaning. [00:26:37] Speaker 04: Well, I think that dietetic, I think we still win either way, whether we interpret dietetic more akin to diabetic and fortified foods and the other listed items there, or whether we take a broader view of what dietetic means according to the plain meaning and dictionary definitions we've cited in all those other sources. [00:26:55] Speaker 04: But the safer route presumably would be to say, [00:26:57] Speaker 04: They're in the same category, dietetic and diabetic foods. [00:27:01] Speaker 04: These are foods that have been adapted or formulated however you want to phrase it. [00:27:06] Speaker 02: Well, actually, that might be a crucial thing. [00:27:09] Speaker 02: Adapted and formulated might be something like the very distinction that the other side is arguing for. [00:27:17] Speaker 02: And it has a certain intuitive appeal. [00:27:19] Speaker 02: Start with a normal food and maybe change it a little. [00:27:23] Speaker 02: And the other is, you know, create so-and-so green. [00:27:27] Speaker 04: Right. [00:27:28] Speaker 02: I think the problem with that, though, is that there are plenty of headings, for instance, you know, headings that cover- That might not be quite right, because sort of that green is actually not. [00:27:36] Speaker 02: It's people, right? [00:27:37] Speaker 02: Yeah. [00:27:39] Speaker 04: You know, I think the problem there is that there are plenty of food preparation headings that cover, you know, baby formula. [00:27:44] Speaker 04: These are regular, old baby formula is going to be made in the lab as well, the components that go into it. [00:27:49] Speaker 04: And they're also going to be classified under provisions that cover food preparations. [00:27:54] Speaker 04: And I don't think that the- [00:27:56] Speaker 04: A normal food being adapted could possibly be. [00:28:00] Speaker 02: Is baby formula a medical food in the FDA regime? [00:28:05] Speaker 04: I don't believe that it is. [00:28:06] Speaker 04: I'm not quite sure that I believe that. [00:28:08] Speaker 04: There are special regulations that govern it, though. [00:28:11] Speaker 04: I do know that. [00:28:12] Speaker 04: So it is at least carved out, or at least there's more scrutiny of how that's labeled and how it's produced. [00:28:20] Speaker 01: If we were to go the other way, the way of the other side, [00:28:23] Speaker 01: Does the government have concerns, I don't want to go too far outside the record, but is there the swath of goods that the government has classically not treated under 30 that this case would open up the door to? [00:28:36] Speaker 04: Well, I think there could be, yes. [00:28:38] Speaker 04: I mean, there's plenty of products on the market that are formulated in a certain way, either to increase certain nutrients or decrease others. [00:28:46] Speaker 04: That's going to create a big problem at the border for customers in terms of trying to figure out, OK, what is really a medicament? [00:28:52] Speaker 04: What's really therapeutic and what's not? [00:28:57] Speaker 04: And it's much easier to say, well, let's look at what the label says. [00:29:00] Speaker 04: Are there drug facts on the label? [00:29:01] Speaker 04: Is there a medical food designation instead? [00:29:04] Speaker 04: Or is this a dietary supplement product? [00:29:07] Speaker 04: That's much easier for customers to be able to figure out, OK, this product fits in the food basket or it fits in the medical basket. [00:29:16] Speaker 02: Why would it be difficult if the products had the medical foods designation on the label and the rule was medical foods come under chapter 30? [00:29:26] Speaker 04: Well, it wouldn't be. [00:29:28] Speaker 04: It would be difficult for me, I suppose. [00:29:31] Speaker 04: It wouldn't be. [00:29:32] Speaker 04: But there are going to be, you know, you can imagine, you know, weight loss bars, other protein products, those sorts of things, where, you know, the argument is going to be, well, this is just like that. [00:29:42] Speaker 04: This is the sort of [00:29:43] Speaker 04: you know, nutrient enhancing products, something like that that's going to affect the structure or function of the body, and this is something that should likewise be classified. [00:29:51] Speaker 03: I think I heard Ms. [00:29:53] Speaker 03: Berman say that these medical foods cannot be taken by healthy people. [00:29:58] Speaker 03: Is that undisputed, and if so, isn't that an important distinction here? [00:30:04] Speaker 04: For all of the foods except for the OK, I would say yes. [00:30:08] Speaker 04: Those are foods that generally healthy people would take. [00:30:11] Speaker 04: I don't think that that's the distinction that ought to be made. [00:30:13] Speaker 04: I think Note 1A presumes that there are going to be those foods that are used nutritionally, therapeutically, as we understand it, diabetic and dietetic foods. [00:30:23] Speaker 04: I suppose some diabetic foods could be consumed by healthy people. [00:30:26] Speaker 04: I'm not sure that's true with respect to all of them. [00:30:28] Speaker 01: But what you've been telling us, well, we're talking about treating diseases, right? [00:30:33] Speaker 01: I mean, how do nutrition bars qualify as that? [00:30:38] Speaker 04: Right. [00:30:38] Speaker 04: They wouldn't. [00:30:38] Speaker 04: I don't think they would. [00:30:40] Speaker 02: But in terms of those would be vitamin C. Right. [00:30:43] Speaker 04: Right. [00:30:44] Speaker 04: So like the vitamin C cases, for instance. [00:30:46] Speaker 04: Right. [00:30:46] Speaker 04: There might be some that are intended for treatment of disease, and there might be some that aren't. [00:30:50] Speaker 04: But our bottom line point is that the word dietetic, as it's found in that Note 1A to Chapter 30, is excluding the foods just like these. [00:30:59] Speaker 02: And just say again, if you have already said, dietetic, in your view, means? [00:31:05] Speaker 04: Food specially formulated for the management or treatment of the condition. [00:31:09] Speaker 04: It doesn't have to be any type of condition, any type of disease, any type of medical purpose for which someone's going on a diet. [00:31:18] Speaker 04: It could be weight loss, it could be a particular disease, it could be diabetes, or could exclude that based on the fact that diabetics mentioned specifically in that same note. [00:31:30] Speaker 04: Our understanding is backed up, not just by, obviously, what the trial board said, but by nutritional documents, they describe at least the goods that contain amino acids as dietetic goods. [00:31:41] Speaker 04: The dictionary of food and nutrition equated medical foods with dietetic foods. [00:31:48] Speaker 04: So it might be a broader understanding of diabetic, but we think it's well supported by all those various sources. [00:31:59] Speaker 04: I guess I'll turn briefly now to the Nairobi Protocol provision. [00:32:04] Speaker 04: You don't have to decide what the word article means, obviously. [00:32:06] Speaker 04: You can just say there. [00:32:07] Speaker 02: Just on that point, do I understand correctly that's not a point that the Court of International Trade made? [00:32:17] Speaker 04: So what we tried to do with it, you're right, did not say that in those terms. [00:32:22] Speaker 02: But you made this argument to the trade court? [00:32:24] Speaker 02: We did not, no. [00:32:25] Speaker 04: So the trade court said, whatever the scope of the Nairobi Protocol provision, it cannot be so broad as to cover nutritional preparations. [00:32:32] Speaker 02: Right, but it didn't make the point. [00:32:33] Speaker 02: The word articles does not include preparations. [00:32:35] Speaker 02: Correct. [00:32:36] Speaker 04: We were just trying to put a finer point on it, basically. [00:32:38] Speaker 04: That's obviously a very broad argument. [00:32:40] Speaker 04: You don't have to decide that. [00:32:41] Speaker 04: It's simple enough to just say that these foods are therapeutic. [00:32:44] Speaker 04: They're nutritionally therapeutic. [00:32:45] Speaker 04: They're used to treat disease when medications fail. [00:32:48] Speaker 04: And so for that reason, they're excluded from classification under US Note 4E to the subchapter that contains heading 9817. [00:32:58] Speaker 04: Obviously, Richard, the medical company, has an explanation of what therapeutic means in that context. [00:33:02] Speaker 04: I really don't think that it's all different from what therapeutic means in heading 3004. [00:33:09] Speaker 04: Richard's medical company was just explaining, based on a Senate report that accompanied the enactment of this particular terrifying, that therapeutic can't be so broad as to cover alleviative adaptations, for instance, [00:33:25] Speaker 04: It was parts used in steering wheel adaptations for persons with disabilities. [00:33:31] Speaker 04: So that sort of steering wheel adaptation would be covered by the NIRB protocol. [00:33:37] Speaker 04: But if it was an easily removable thing that was going to be used for tariff engineering, then it wouldn't be. [00:33:42] Speaker 04: That Senate report, which the court described as not very good. [00:33:45] Speaker 02: It would be used for what engineering? [00:33:46] Speaker 02: Oh, sorry, tariff engineering. [00:33:47] Speaker 02: So. [00:33:48] Speaker 02: Tariff engineering. [00:33:49] Speaker 04: Right. [00:33:50] Speaker 04: Entering a good is one thing, and then doing something right after it's immediately imported [00:33:54] Speaker 04: to bring it into it. [00:33:55] Speaker 04: It would otherwise be classified differently under a higher duty grade. [00:33:59] Speaker 02: I see. [00:34:00] Speaker 02: So you import a van with certain properties, and then you take out the stuff that got you in under the lower tariff. [00:34:07] Speaker 04: Yes. [00:34:09] Speaker 04: Exactly. [00:34:09] Speaker 04: That's never happened before. [00:34:11] Speaker 04: It was surprisingly enough. [00:34:11] Speaker 04: No, it has. [00:34:12] Speaker 04: That's the Ford case, exactly. [00:34:14] Speaker 04: That's legal. [00:34:15] Speaker 04: Obviously, that's fine. [00:34:16] Speaker 04: You can tariff engineer so long as it meets the requirements that the Supreme Court has set out in this case. [00:34:23] Speaker 04: But the point is that that legislative history wasn't really helping out in determining what the scope of therapeutic means. [00:34:29] Speaker 04: And we think that it makes sense to interpret the term the same across the tariff, therapeutic means, for the treatment of disease. [00:34:34] Speaker 03: You made brief mention of Canada. [00:34:36] Speaker 03: The great brief at page 21 says that ultimately something happened in Canada that favors their side under chapter 98. [00:34:44] Speaker 03: Could you just respond to that briefly? [00:34:45] Speaker 04: Sure. [00:34:46] Speaker 04: What happened in Canada is that the [00:34:48] Speaker 04: Canadian Border Services Agency decided to settle, after the Canadian International Trade Tribunal ruled against Nutricia, on Nino Cape products. [00:34:59] Speaker 04: My understanding is that the agency there decided to settle by liquidating the Nino Cape products, or maybe the different products, under their enactment, their implementation of the Nairobi Protocol on Canada. [00:35:15] Speaker 04: My understanding is that implementation does not have an exclusion like what we have here for therapeutic articles, medicines, and drugs. [00:35:23] Speaker 04: But that's what happens subsequently in Canada. [00:35:27] Speaker 01: Thank you. [00:35:28] Speaker 01: Thank you. [00:35:28] Speaker 01: Thank you. [00:35:28] Speaker 01: Will we still have three minutes of free time? [00:35:30] Speaker 00: Thank you, Your Honor. [00:35:33] Speaker 00: Your Honor, I want to start by noting that the government has changed its definition of the word dietetic. [00:35:37] Speaker 00: In its brief, it says, and this is page 13, dietetic foods are those adapted for use in special diets. [00:35:44] Speaker 00: These are not adaptive foods. [00:35:46] Speaker 00: It didn't say formulated, and that is an important difference in our view. [00:35:50] Speaker 02: I'm sorry. [00:35:51] Speaker 02: Read what? [00:35:52] Speaker 00: Page? [00:35:53] Speaker 00: Page 13 of the government's policy. [00:35:55] Speaker 00: Yes. [00:35:57] Speaker 00: And Your Honor, the government also keeps trying to use terms that are not in the relevant headings there. [00:36:02] Speaker 00: For example, active ingredient is nowhere in heading 30-04 or any of the other headings we're talking about. [00:36:07] Speaker 02: But interestingly, Your Honor, can you win if the definition of dietetic is what Mr. Mathers said this morning it is? [00:36:18] Speaker 00: Specially formulated? [00:36:21] Speaker 00: Your Honor, I think we still can, because you have to go back to what does the heading say? [00:36:26] Speaker 00: Is it used for therapeutic purposes? [00:36:28] Speaker 00: That is what you govern here. [00:36:29] Speaker 00: This is a use provision. [00:36:30] Speaker 00: You apply the carderone factor. [00:36:33] Speaker 00: whether it's formulated or adapted, that should be our guiding star here. [00:36:37] Speaker 00: And that's the line we see drawn in the explanatory notes here, both 30.04 and 21.06. [00:36:42] Speaker 00: So I think we still can win. [00:36:44] Speaker 00: But I do think that's an important distinction here. [00:36:48] Speaker 00: Your Honor, I also wanted to point on the active ingredients. [00:36:51] Speaker 02: I'm sorry. [00:36:52] Speaker 02: This seems so central. [00:36:53] Speaker 02: And I'm sorry to take up your limited time. [00:36:57] Speaker 02: Fair to say that the relevant canon of construction almost has to mean that dietetic, to make it parallel to diabetic and more akin to the various items and not to displace the other items, needs to be limited to adapted but not formulated. [00:37:25] Speaker 00: I think that is true, Your Honor. [00:37:27] Speaker 00: And I would point to the other categories in note 1A, which include very specific things like tonic waters and mineral waters. [00:37:35] Speaker 00: These are all food products. [00:37:37] Speaker 00: Many of them are specifically listed in section four. [00:37:40] Speaker 00: Mineral waters is under heading 2102. [00:37:43] Speaker 00: So again, and I think that gets to one thing we didn't mention earlier, which is that parenthetical at the end of note 1A, which says section four, we think that is purely intended to say [00:37:54] Speaker 00: It has to be things that qualify under section four. [00:37:56] Speaker 00: And I'd encourage the court to look at the list of section four headings. [00:38:00] Speaker 00: They're all traditional foods. [00:38:02] Speaker 00: Chocolate, wine, maybe that's not a traditional food, but you get my point. [00:38:07] Speaker 00: Cocoa beans, sausages, yeast is listed there. [00:38:12] Speaker 00: And that, we know from note 1F, says if yeast is put up as a medicament, if it's used for therapeutic use, then it goes in 3004. [00:38:21] Speaker 00: All the arrows here, Your Honor, I think point to drawing this line between things for medical use to treat diseases and things that are not used to treat diseases. [00:38:30] Speaker 00: Before I was talking about the FDA regs, I do think it is important here to note that medical foods have this special definition that requires them to be used for the treatment of a disease or condition under medical supervision. [00:38:44] Speaker 00: And that they had to be, at the same time that definition was enacted, they had to be excluded from regulation as drugs under the FDCA because otherwise they do qualify as drugs. [00:38:54] Speaker 00: So again, we're clearly on the medicine line of food and medicine here, Your Honors. [00:39:00] Speaker 00: And Your Honor, I just want to conclude by pointing out that if note 1A means what they say it means, which is if the word dietetic basically means pertaining to any sort of nutritional product, [00:39:12] Speaker 00: That would eviscerate the scope of 1303 and 1304. [00:39:16] Speaker 00: Many medical products have nutritional components, or that is part of them. [00:39:21] Speaker 00: And that would be contrary to note 1F, noting that yeast, if it's used for medicinal purposes, qualifies under 1304. [00:39:29] Speaker 00: Thank you, Your Honor. [00:39:31] Speaker 01: Thank you. [00:39:31] Speaker 01: We thank both sides, and the case is submitted.