Comercio v. United States

Citation700 F.Supp.2d 1364
Decision Date06 April 2010
Docket NumberCourt No. 08-00277.,Slip Op. 10-35.
PartiesFISCHER S.A. COMERCIO, INDUSTRIA AND AGRICULTURA, and Citrosuco North America, Inc., Plaintiffs,v.UNITED STATES, Defendant,andFlorida Citrus Mutual, A. Duda & Sons, Citrus World, Inc., and Southern Gardens Citrus Processing Corporation, Defendant-Intervenors.
CourtU.S. Court of International Trade

Kalik Lewin (Robert G. Kalik and Brenna Steinert Lenchak); Galvin & Mlawski, New York City (John Joseph Galvin), of counsel, for Plaintiffs Fischer S.A. Comercio, Industria and Agricultura and Citrosuco North America, Inc.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, Franklin E. White, Jr., Assistant Director, Commercial

Litigation Branch, Civil Division, United States Department of Justice (Michael J. Dierberg); Mykhaylo A. Gryzlov, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, of counsel, for Defendant.

Barnes, Richardson & Colburn, Washington, DC (Matthew Thomas McGrath and Stephen William Brophy) for Defendant-Intervenors Florida Citrus Mutual, A. Duda & Sons, Citrus World, Inc. and Southern Gardens Citrus Processing Corporation.

Opinion & Order

CARMAN, Judge:

Plaintiff Fischer S.A. Comercio, Industria and Agricultura is a foreign producer-exporter of orange juice subject to the final results of the first administrative review of an antidumping duty order on certain Brazilian orange juice. Certain Orange Juice from Brazil: Finals Results and Partial Rescission of Antidumping Duty Administrative Review, 73 Fed.Reg. 46,584 (Aug. 11, 2008) (“Final Results”). Plaintiff Citrosuco North America, Inc. is the affiliated importer of Fischer S.A. Comercio, Industria and Agricultura. (Compl.¶ 3.) For simplicity, Plaintiffs are referred to together as “Fischer.”

Fischer brings this challenge to a portion of the Final Results pursuant to section 516A of the Tariff Act of 1930, as amended, 19 U.S.C. 1516a (2006). The matter is now before the Court on Fischer's Motion for Judgment on the Agency Record, filed pursuant to USCIT Rule 56.2.1 The United States (Defendant or “government”) as well as domestic producers and interested parties Florida Citrus Mutual, A. Duda & Sons, Citrus World, Inc. and Southern Gardens Citrus Processing Corporation (Defendant-Intervenors) opposed the motion,2 and Plaintiff filed a reply.3

Fischer advances five claims challenging various aspects of the Final Results. (Compl.¶¶ 26-39.) Fischer's first claim stems from the manner in which its United States sales of not-from-concentrate orange juice (“NFC”) were converted from gallons, the unit in which NFC was sold in the United States, into pounds-solids so that they could be compared with home market sales made in kilograms. (Compl.¶¶ 28-30.) 4 A pound-solid is “a basic and standardized measurement of the amount of dissolved citrus sugar found in juice.” U.S. Int'l Trade Comm'n, Certain Orange Juice From Brazil, Investigation 731-TA-1089 (Final), Pub. 3838 (Mar.2006) at 17 n. 132. Converting gallons of NFC to pounds-solids involves determining the weight in pounds of the fruit sugar solids dissolved in each gallon of NFC. Thus, the sweetness of the NFC is an essential factor in converting gallons of NFC into pounds-solid of NFC; the sweeter a batch of NFC is, the heavier will be the fruit sugar solids it contains. Fischer contends that Commerce distorted the price paid for its United States NFC sales by converting to pounds-solids using the actual sweetness of each individual shipment of NFC, rather than converting based upon an assumed amount of sweetness that actually determined the price of Fischer's NFC sales. According to Fischer, this conversion error had the effect of lowering the gross unit price 5 of Fischer's United States sales below the price actually paid by the United States buyer, resulting in an increased dumping margin contrary to substantial evidence in the record. (Public Motion at 18-23.) Second, Fischer argues that a similar error in Commerce's conversion of home market NFC sales from kilograms to pounds-solids caused an improper increase in the gross unit price in the home market, which was unsupported by substantial evidence. ( Id. at 28.) Third, Fischer claims that Commerce abused its discretion by rejecting documents that Fischer submitted in response to the preliminary results of the administrative review, despite the fact that the submission was made almost nine months after the regulatory deadline had expired for the filing of factual information. Fischer asserts that Commerce was required to accept these documents, despite their lateness, because they simply clarified errors in information already timely submitted. ( Id. at 24-27.) Fourth, Fischer claims that, in calculating the statutory Normal Value (“NV”) of Fischer's home market sales, Commerce used an inventory carrying cost offset based on industry-wide average costs, rather than using data submitted by Fischer which showed the actual inventory carrying costs for the specific home market NFC sales under consideration. According to Fischer, this error distorted NV and was unsupported by substantial evidence. ( Id. at 29-30.) Fifth, Fischer challenges Commerce's application of 19 C.F.R. 351.414(e)(2) (the “90/60 day contemporaneity rule”), pursuant to which Commerce considered a home market sale occurring outside the Period of Review (“POR”) when calculating the antidumping margin. Fischer claims that, in doing so, Commerce acted contrary to statute and its own regulations. ( Id. at 30-33.) Fischer also moves for oral argument.6

As discussed in full below, the Court concludes that: (1) Commerce relied on Fischer's mistaken reporting of an incorrect conversion factor and, as a result, calculated an inaccurate gross unit price for Fischer's United States NFC sales, and (2) Commerce abused its discretion when it rejected materials Fischer submitted after the preliminary results of the investigation, which reliably established the mistake and demonstrated the correct conversion factor. On the other hand, both (3) Commerce's calculation of the gross unit price of home market NFC sales and (4) Commerce's calculation of inventory carrying cost offsets were supported by substantial evidence, and (5) Commerce acted in accordance with statute and regulation in applying its 90/60 day contemporaneity rule. The Court therefore grants in part Fischer's Motion for Judgment on the Agency Record, affirms Commerce's determination of NV for Fischer's home market sales and its use of the 90/60 day contemporaneity rule, and remands to Commerce for recalculation, as detailed below, of the gross unit price of Fischer's United States NFC sales using the appropriate conversion factor. Fischer's Amended Motion for Oral Argument is denied.

Factual Background

The antidumping duty order underlying this case went into effect on March 9, 2006. Antidumping Duty Order: Certain Orange Juice from Brazil, 71 Fed.Reg. 12,183 (Mar. 9, 2006) (“AD Order”). On March 2, 2007, Commerce published a notice of opportunity to request administrative review of the order, with the POR extending from August 24, 2005 to February 28, 2007. Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 72 Fed.Reg. 9,505 (Mar. 2, 2007). Upon request, Commerce began a first administrative review. Initiation of Antidumping and Countervailing Duty Administrative Reviews, 72 Fed.Reg. 20,986 (Apr. 27, 2007) (“Notice of Initiation”). In the course of the review, Fischer provided relevant information in several responses and supplemental responses to questionnaires from Commerce. These responses are contained in the administrative record as follows: (1) the Section A Response” ( Letter w/Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Sec A Qnaire (May 5, 2007), PR 22, CR 2) 7; (2) the Section B Response” ( Letter w/Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Qnaire B Response (June 1, 2007), PR 24, CR 3); (3) the Section C Response” ( Letter w/ Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Qnaire C Response (June 1, 2007), PR 25, CR 4); (4) the “First Supplemental AB ( Letter w/ Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Supp Qnaire Secs A & B (Oct. 10, 2007), PR 47, CR 15); (5) the “Supplemental C” ( Letter w/ Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Supp Sec C QR (Nov. 5, 2007), PR 58, CR 21); (6) the “Second Supplemental AB ( Letter w/Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Supp QR Secs A & B (Nov. 15, 2007), PR 63, CR 24); (7) the “First Supplemental BC” ( Letter w/Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Supp QR Secs B & C (Dec. 17, 2007), PR 69, CR 28); and (8) the “Second Supplemental BC” ( Letter w/Attachment(s) from law firm of Kalik Lewin to Sec of Commerce Fischer Supp Sec B & C QR (Mar. 13, 2008), PR 80, CR 35).

The preliminary results of the first administrative review were published on April 7, 2008. Certain Orange Juice from Brazil: Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 73 Fed.Reg. 18,773 (Apr. 7, 2008) (“Preliminary Results”). In the Preliminary Results, Commerce determined the weighted-average dumping margin for Fischer to be 2.46 percent for the period August 24, 2005 through February 28, 2007. Id. at 18,778.

Following publication of the Preliminary Results, Fischer timely submitted a case brief on May 8, 2008. ( Brief from Law Firm of Kalik Lewin to Sec of Commerce Fischer Case Brief, PR 103, CR 48 (“Case Brief”).) Commerce sent a letter to Fischer the same day stating that it had “determined that certain information contained in [the] case brief represents new and untimely filed factual information.” ( Letter from Program Mgr/IA to law firm of Kalik Lewin rejecting...

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