Louis Dreyfus Citrus Inc. v. U.S.

• Decision Date: 19 June 2007
• Docket Number: Court No. 06-00122.,Slip Op. 07-96.
• Parties: LOUIS DREYFUS CITRUS INC., Plaintiff, v. UNITED STATES, Defendant, and Florida Citrus Mutual et al., Defendant — Intervenors.
• Court: U.S. Court of International Trade

Page 1338

495 F.Supp.2d 1338

LOUIS DREYFUS CITRUS INC., Plaintiff, v. UNITED STATES, Defendant, and Florida Citrus Mutual et al., Defendant — Intervenors.

Slip Op. 07-96.

Court No. 06-00122.

United States Court of International Trade.

June 19, 2007.

COPYRIGHT MATERIAL OMITTED

Dewey Ballantine LLP (Kevin M. Dempsey, David A. Bentley and Christophe F. Guibert de Bruet), Washington, DC, for Plaintiff Louis Dreyfus Citrus Inc.

Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Michael J. Dierberg); and Mildred E. Steward, Office of Chief Counsel for Import Administration, U.S. Department of Commerce, of Counsel, for Defendant United States.

Barnes, Richardson & Colburn, (Matthew T. McGrath, Stephen W. Brophy and James B. Doran), Washington, DC., for Defendant-Intervenors Florida Citrus Mutual, A. Duda & Sons, Inc. (d/b/a Citrus Belle), Citrus World, Inc., and Southern Gardens Citrus Processing Corporation (d/ b/a Southern Gardens).

OPINION

WALLACH, Judge.

I Introduction

This case comes before the court on a Motion for Judgment Upon the Agency Record pursuant to USCIT Rule 56.2 brought by Louis Dreyfus Citrus Inc. ("Plaintiff" or "Louis Dreyfus"). Plaintiff claims it has suffered injury in fact from an order imposing antidumping duties ("AD") on frozen concentrated orange juice for further manufacture ("FCOJM") produced and exported by Plaintiff. Complaint ¶ 7; Antidumping Duty Order: Certain Orange Juice from Brazil, 71 Fed. Reg. 12,183 (March 9, 2006) ("AD Order"). Plaintiff challenges, inter alia, (1) the authority of the United States Department of Commerce ("Commerce" or "the Department") to initiate an investigation prior to the revocation of an order covering identical merchandise, (2) the producer-specific scope of the investigation, and (3) aspects of Commerce's Final Determination in Notice of Final Determination of Sales at Less Than Fair Value and Affirmative Final Determination of Critical Circumstances: Certain Orange Juice from Brazil, 71 Fed.Reg. 2,183 (January 13, 2006) ("Final Determination"), as amended by 71 Fed.Reg. 8,841 (February 21, 2006) ("Amended Final Determination"). Memorandum of Law in Support of Plaintiff's Rule 56.2 Motion for Judgment Upon the Agency Record ("Plaintiff's Motion") at 2-3; Notice of Initiation of Antidumping Duty Investigation: Certain Orange Juice From Brazil, 70 Fed.Reg. 7,233 (February 11, 2005) ("Initiation of OJ AD Inv.").

For the reasons set forth herein, Plaintiffs Motion is DENIED.

II Background

Plaintiff is an importer of frozen concentrated orange juice ("FCOJ")¹ and the parent company of Coinbra-Frutesp, S.A. ("Coinbra-Frutesp"), a Brazilian producer of FCOJ. Complaint ¶ 10. On March 18, 2004, the United States Customs and Border Protection ("CBP" or "Customs") issued a Notice of Action concerning an entry made by Coinbra-Frutesp on November 17, 2003 in which it determined that exports of orange juice manufactured by Coinbra-Frutesp were subject to the "all others" rate under a 1987 order on frozen concentrated orange juice from Brazil. Letter from Christopher Dunn, Willkie Farr & Gallagher LLP to Donald L. Evans, Sec'y of Commerce, U.S. Dep't of Commerce (August 4, 2004) ("LDCI CCR Request") at 4-5, Confidential Record ("C.R.") at 5-6 (request for changed circumstances review). Customs also required that deposits be made on entries until Commerce confirmed Coinbra-Frutesp's exclusion from the order in a changed circumstances review. Id. at 5, C.R. at 6; see also Antidumping Duty Order; Frozen Concentrated Orange Juice From Brazil, 52 Fed.Reg. 16,426 (May 5, 1987) ("1987 FCOJ AD Order").

In August 2004, Louis Dreyfus requested a changed circumstances review wherein Plaintiff stated that "Louis Dreyfus, through its virtually wholly-owned subsidiaries, is the successor in interest to both Frutesp and Frutropic," both companies that had previously been revoked from the 1987 FCOJ AD Order LDCI CCR Request 5-6, C.R. at 6-7. The successor-in-interest relationship between Plaintiff and Coinbra-Frutesp was outlined by Plaintiff as follows.

In 1988, Frutropic S.A. ("Frutropic") was purchased by Comercio e Industrias Brasileiras Coinbra S.A. ("Coinbra"), a wholly-owned subsidiary of Louis Dreyfus. Id. at 3, C.R. at 4. In October of 1992, Frutropic ceased to exist as a legal entity when it was formally dissolved. Letter from Christopher Dunn, Willkie Farr & Gallagher LLP to Carlos Gutierrez, Sec'y of Commerce, U.S. Dep't of Commerce (March 25, 2005) ("LDCI Additional Info. Letter") at 1, C.R. at 42. On April 7, 1993, Frutropic notified Commerce that the company had been incorporated into Coinbra and that its named had changed to Coinbra or Frutropic/COINBRA. LDCI CCR Request at 3-4, C.R. 4-5. Frutropic was at the time of purchase subject to the 1987 FCOJ AD Order from which it was revoked in 1994 under the name Frutropic/COINBRA. Id; see also Frozen Concentrated Orange Juice From Brazil; Final Results of Antidumping Duty Administrative Review and Revocation of Order in Part, 59 Fed.Reg. 53,137 (October 21, 1994) ("1994 FCOJ Final Results".) Coopercitrus Industrial Frutesp, S.A. ("Frutesp") was purchased by Plaintiff in 1993 after which "the assets, management and employees of Frutesp were transferred to the control of Louis Dreyfus and subsumed by it." LDCI CCR Request at 6, C.R. at 7. The 1987 AD order for Frutesp had already been revoked in 1991. Id. at 2, C.R. at 3; Frozen Concentrated Orange Juice From Brazil; Final Results and Termination in Part of Antidumping Duty Administrative Review; Revocation in Part of the Antidumping Duty Order, 56 Fed.Reg. 52,510 (October 21, 1991) ("1991 FCOJ Final Results"). In 1994 the name of the merged company was changed to Coinbra-Frutesp. LDCI CCR Request at 6, C.R. at 7. As a result of the outlined transactions, by 1994, Louis Dreyfus had acquired all assets of both Frutesp and Frutropic, and since the revocation of the antidumping duty order on Frutropic/COINBRA, has exported FCOJ to the United States exclusively under the name Coinbra-Frutesp. Id. at 4, C.R. at 5.

Prior to the commencement of Commerce's investigation into Certain Orange Juice from Brazil, the 1987 order on FCOJ underwent a sunset review. Initiation of Five-Year ("Sunset") Reviews, 69 Fed. Reg. 17,129 (Dep't of Commerce April 1, 2004); Frozen Concentrated Orange Juice From Brazil, 69 Fed.Reg. 17,230 (U.S. Int'l Trade Comm'n April 1, 2004) ("Initiation of FCOJ Sunset Review"). In November 2004 interested domestic parties submitted a letter to Commerce withdrawing any further interest in the 1987 order due to "its lack of any remaining remedial effect." Letter from Matthew T. McGrath et al., Barnes, Richardson & Colburn to Donald L. Evans, Sec'y of Commerce, U.S. Dep't of Commerce (December 27, 2004) ("Petition") at 3, C.R. at 13. The interested domestic parties considered the 1987 order to have "small injury-mitigating effect" because only exporters Citrovita Agro Industrial, Ltda ("Citrovita") and Branco Peres Citrus were still known to be covered by the order. Id. at 4, C.R. at 14. In addition, Citrovita was allegedly evading the order through tolling arrangements with a party excluded from the order, rendering the order largely ineffective. Letter from Matthew T. McGrath et al., Barnes, Richardson & Colburn to Donald L. Evans, Sec'y of Commerce, U.S. Dep't of Commerce (January 6, 2005) ("Petitioners' Response to Request for Add'l Info. in Support of Petition") at 14, C.R. at 20. At the time of the sunset review most major producers and/or exporters of FCOJM had either been revoked or excluded from the order and as a consequence were outside the purview of the order. Petition at 3, C.R. at 13. Moreover, the 1987 order did not cover pasteurized single-strength orange juice not-from-concentrate ("NFC"), which was a new product that had only been imported into the U.S. market subsequent to the issuance of the 1987 order due to new and more cost-efficient means of transporting the merchandise. Id; see also Certain. Orange Juice from Brazil, USITC Pub. 3838, Inv. Nos. 731-TA-1089 (March 2006) ("Final ITC Injury Determination") at On April 13, 2005, Commerce revoked the 1987 order in its entirety. Revocation of Antidumping Duty Order: Frozen Concentrated Orange Juice from Brazil, 70 Fed.Reg. 19,416 (April 13, 2005) ("FCOJ Revocation").

On December 27, 2004, Florida Citrus Mutual, A. Duda & Sons, Inc. (d/b/a Citrus Belle), Citrus World, Inc., and Southern Garden Citrus Processing Corporation (d/b/a Southern Gardens) (collectively "Defendant-Intervenors"), domestic producers of orange juice, filed an antidumping duty petition with Commerce alleging that imports of FCOJM and NFC from Brazil were being sold in the United States at less than fair value ("LTFV"), materially injuring the domestic industry. Defendant's Response to Plaintiff's Motion for Judgment Upon the Agency Record ("Defendant's Motion") at 3. Petitioners requested that reconstituted orange juice, frozen orange juice for retail ("FCOJR") and FCOJM produced by companies still subject to the old order be excluded from the scope of the investigation. Petition at 42-43, C.R. at 15-16. As a result of the petition, Commerce, on February 11, 2005, initiated a LTFV investigation on Certain Orange Juice from Brazil. Initiation of OJ AD Inv., 70 Fed.Reg. at 7,234. Commerce crafted the scope of the investigation specifically to not overlap with the 1987 FCOJ AD Order and therefore included all orange juice not-from-concentrate, a class of merchandise not previously subject to an order and FCOJM produced and/or exported only by Cargill Citrus Limitada, Citrosuco Paulista S.A., Frutropic S.A., Montecitrus Industria e Comercio Limitada, and Sucocitrico Cutrale S.A. (Cutrale), all of whom had been excluded or revoked from the old order. Id. at 7,234. Commerce stated that it had also commenced a changed...