Asociacion Colombiana de Exportadores v. US, Court No. 87-04-00623

• Decision Date: 14 July 1988
• Docket Number: Court No. 87-04-00623,87-04-00634 and 87-04-00689.
• Parties: The ASOCIACION COLOMBIANA de EXPORTADORES de FLORES, et al., Plaintiffs, v. The UNITED STATES, Defendant, and Floral Trade Council of Davis, California, Defendant-Intervenor. FLORAL TRADE COUNCIL OF DAVIS, CALIFORNIA, Plaintiffs, v. The UNITED STATES, Defendant, and the Asociacion Colombiana de Exportadores de Flores, et al., and American Flower Corp., and the Government of Israel and Agrexco, Agricultural Export Co., and Bedrijfschap Voor de Groothandel, etc. and Vereniging Van Bloemenveiling, etc., Defendant-Intervenors. FLORAL TRADE COUNCIL OF DAVIS, CALIFORNIA, Plaintiffs, v. The UNITED STATES, Defendant, and Flores Esmeralda S.R.L., and the Government of Kenya, Defendant-Intervenor.
• Court: U.S. Court of International Trade

693 F. Supp. 1165

The ASOCIACION COLOMBIANA de EXPORTADORES de FLORES, et al., Plaintiffs, v. The UNITED STATES, Defendant, and Floral Trade Council of Davis, California, Defendant-Intervenor.

FLORAL TRADE COUNCIL OF DAVIS, CALIFORNIA, Plaintiffs, v. The UNITED STATES, Defendant, and the Asociacion Colombiana de Exportadores de Flores, et al., and American Flower Corp., and the Government of Israel and Agrexco, Agricultural Export Co., and Bedrijfschap Voor de Groothandel, etc. and Vereniging Van Bloemenveiling, etc., Defendant-Intervenors.

FLORAL TRADE COUNCIL OF DAVIS, CALIFORNIA, Plaintiffs, v. The UNITED STATES, Defendant, and Flores Esmeralda S.R.L., and the Government of Kenya, Defendant-Intervenor.

Court Nos. 87-04-00623, 87-04-00634 and 87-04-00689.

United States Court of International Trade.

July 14, 1988.

Heron, Burchette, Ruckert & Rothwell (Thomas A. Rothwell, Jr., James M. Lyons and William E. Donnelly), Washington, D.C., for Asociacion Colombiana de Exportadores and American Flower Corp.

Joseph A. Vicario, Jr. and Alfred G. Scholle, Washington, D.C., for Asociacion Colombiana de Exportadores.

Stewart & Stewart (Eugene L. Stewart, Terence P. Stewart, James R. Cannon, Jr. and Jimmie V. Reyna), Washington, D.C., for The Floral Trade Council of Davis, California.

Lyn M. Schlitt, Gen. Counsel, James A. Toupin, Asst. Gen. Counsel and (Judith M. Czako), U.S. Intern. Trade Com'n, Washington, D.C., for defendant.

Kaplan, Russin & Vecchi (Kathleen F. Patterson and Dennis James, Jr.), Washington, D.C., for The Government of Israel and Agrexco Agricultural Export Co.

Gustav Springer, New York City, for Bedrijfschap Voor de Groothandel, etc. and Vereniging Van Bloemenveiling, etc.

Prather, Seeger, Doolittle & Farmer (Edwin H. Seeger), Washington, D.C., for Flores Esmeralda, S.R.L.

Duncan, Allen and Mitchell (John P. Williams and Leslie A. Glick), Washington, D.C., for The Government of Kenya.

OPINION AND ORDER

RESTANI, Judge:

This matter involves consolidated actions challenging International Trade Commission (ITC) determinations as to injury from less than fair value (LTFV) and subsidized imports of cut flowers from Canada, Chile, Columbia, Costa Rica, Ecuador, Israel, the Netherlands, Mexico, Kenya and Peru.¹ Certain Fresh Cut Flowers from Canada, Chile, Colombia, Costa Rica, Ecuador, Israel, and the Netherlands, USITC Pub. 1956, Inv. Nos. 701-TA-275 through 278 and 731-TA-327 through 331 (Mar. 1987); Certain Fresh Cut Flowers from Peru, Kenya and Mexico, USITC Pub. 1968, Inv. Nos. 303-TA-18 and 731-TA-332, 333 (Apr. 1987).² The following seven cut flowers were involved: standard carnations, miniature carnations, standard chrysanthemums, pompon chrysanthemums, alstromeria, gerberas, and gypsophila. ITC's final investigation covered the period 1983 through the first nine months of 1986.

Three ITC commissioners, constituting a majority as to the affirmative determinations noted below, found seven different domestic industries produced the "like" products involved, that is, each type of flower was found to be produced by a different domestic industry. USITC Pub. 1956. This majority found material injury by reason of subsidized imports of standard carnations from Canada and Chile, as well as by subsidized imports of standard chrysanthemums from the Netherlands. It found material injury by reason of LTFV imports of standard carnations from Canada, Chile, Columbia, Costa Rica, and Ecuador, of standard chrysanthemums from Colombia and Ecuador, and of pompon chrysanthemums from Colombia, Costa Rica and Ecuador. It found further that LTFV imports of miniature carnations from Colombia threatened injury, and that there was no threat of material injury by reason of imports of miniature carnations from Canada, the Netherlands and Kenya. This same majority also found material injury with respect to subsidized imports of pompon chrysanthemums from Peru, and LTFV imports of standard carnations from Kenya and Mexico and of standard and pompon chrysanthemums from Mexico. USITC Pub. 1968. A second majority, comprised of one of the commissioners in the first majority discussed above and the two remaining commissioners, rendered a negative decision with respect to threat of material injury by reason of imports of miniature carnations from Costa Rica, Ecuador, Israel and Peru.

In this action, Asociacion Colombiana de Exportadores de Flores (Asocolflores) and others with similar interests challenge the affirmative decision with regard to imports of standard and miniature carnations, and standard and pompon chrysanthemums from Colombia on the basis that the first ITC majority erred in finding seven domestic industries and that the domestic industry was not suffering or threatened with material injury. ITC and the Floral Trade Council oppose these views. Floral Trade Council, on the other hand, challenges the negative ITC threat determination with respect to imports of miniature carnations from Costa Rica, Ecuador, Israel, Peru, Kenya, the Netherlands, and Canada on the basis of failure to cumulate and, as to miniature carnations from the first four countries, lack of substantial evidence in view of likely price suppression or depression and likely product shifting. ITC, Asocolflores, and representatives of the cut flower industries and/or the governments of Costa Rica, Israel, Kenya, and Peru have filed briefs opposing these views.

I. LIKE PRODUCT

The threshold question in this case is what is the domestically produced product which is "like" the products under investigation. Until that question is answered, it is impossible to determine which industry is to be examined for injury or threat of injury. Based on their finding that the entire cut flower industry in the United States was the relevant industry producing the product like those under investigation, two commissioners reached a negative determination as to all imports. No one has seriously challenged their conclusions that the cut flower industry as a whole is neither injured nor threatened with injury. Three commissioners found, however, injury or threat of injury to different domestic industries by reason of imports of certain flowers. Their determination was based on the underlying finding that each of the seven flowers under investigation, including each of the four flowers that are involved in this action, is like only that particular flower type. Thus, seven different domestic industries were found to exist. This finding necessarily means that ITC also found that each flower is unlike the six other flowers under investigation or any other domestically produced flower.

An understanding of the position of the ITC commissioners is of central importance in this case. As stated, the aspects of the determinations under review involve two majorities. One majority found material injury by reason of imports of standard carnations and standard and pompon chrysanthemums from Colombia, as well as threat of injury by reason of imports of miniature carnations from Colombia. This majority (together with the two remaining commissioners) also found no threat of injury by reason of miniature carnations from Canada, the Netherlands and Kenya. The other majority, comprised of one commissioner in the first majority and the two commissioners who found one domestic cut flower industry, rendered a negative decision with respect to threat of injury by reason of imports of miniature carnations from Costa Rica, Ecuador, Israel and Peru. In order for this negative threat determination to stand, the opinions of the two commissioners who found one domestic cut flower industry must be sustained, as well as the determination that seven industries existed. Thus, ITC requests the court to find that two opposite conclusions as to what is the like product at issue are supported by substantial evidence. This is not impossible; substantial conflicting evidence upon which reasonable minds could reach differing results might exist. There is, however, very little evidence of record in this case to support a finding of one domestic cut flower industry.

First, very little evidence regarding the entire flower industry was obtained. It is difficult to fault the dissent for this, as it sought to obtain information on flowers other than the seven investigated, particularly information on one flower, roses, but it was outvoted on this point.³ Nonetheless, the court can only review information that was obtained. The sole relevant evidence cited in the opinions finding one industry is the testimony of representatives of a retailing organization indicating that substitutability is high at the consumer stage. If one has to choose a single basis upon which to make a like product determination, consumer preference would seem to be a poor choice. For example, if apples are sold out, a shopper might buy oranges, but this does not make apples and oranges like products. On the other hand, someone who wears a size ten skirt is not going to accept a size six, but this does not make the two garments unlike for purposes of injury determinations. Even if consumer acceptance of a substitute is one of the factors to be considered in making the like product determination, the evidence cited here supporting that factor, by itself, is insufficient to support the one-industry determination.⁴ It simply does not rise to the level of substantial evidence.

Second, one commissioner viewed the like product issue as essentially a legal one, a position to which Asocolflores subscribes. That is, Asocolflores would like the court to rule as a matter of law that differences in specific use may not lead to multiple like product determinations, citing various cases, e.g., Top-of-the-Stove Stainless Steel Cooking Ware from Korea and Taiwan, USITC Pub. 1936, Inv. Nos. 701-TA-267, 268 and 731-TA-304, 305 (Jan. 1987) (various cooking ware including sauce pans, skillets and stock pots found to be like products), 64K Dynamic...