Asociacion Colombiana de Exportadores v. US

• Decision Date: 27 December 1988
• Docket Number: Court No. 87-04-00623.
• Citation: 704 F. Supp. 1068
• Parties: The ASOCIACION COLOMBIANA de EXPORTADORES de FLORES, et al., Plaintiffs, v. The UNITED STATES, et al., Defendants.
• Court: U.S. Court of International Trade

704 F. Supp. 1068

The ASOCIACION COLOMBIANA de EXPORTADORES de FLORES, et al., Plaintiffs, v. The UNITED STATES, et al., Defendants.

Court No. 87-04-00623.

United States Court of International Trade.

December 27, 1988.

Heron, Burchette, Ruckert & Rothwell (Thomas A. Rothwell, Jr., James M. Lyons and William E. Donnelly), for Asociacion Colombiana de Exportadores de Flores and American Flower Corp. (Joseph A. Vicario, Jr. and Alfred G. Scholle), for Asociacion Colombiana de Exportadores de Flores.

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

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

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

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

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

Duncan, Allen and Talmage (John P. Williams and Leslie A. Glick), for Government of Kenya.

OPINION

RESTANI, Judge:

This case is before the court following the International Trade Commission's (ITC) remand determination in Certain Fresh Cut Flowers from Canada, Chile, Colombia, Costa Rica, Ecuador, Israel, Kenya, Mexico, The Netherlands, and Peru, Inv. Nos. 303-TA-18, 701-TA-275 through 278 and 731-TA-327 through 333 (August 1988) (Remand Determination). At this point in the proceedings, the only live issues involve negative threat determinations concerning miniature carnations from various countries.¹ The background of this consolidated case, involving challenges to certain of ITC's affirmative and negative determinations in 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 (March 1987) (Flowers I) and in Certain Fresh Cut Flowers from Peru, Kenya and Mexico, USITC Pub.1968, Inv. Nos. 303-TA-18 and 731-TA-332, 333 (April 1987) (Flowers II), is set forth in Asociacion Colombiana de Exportadores de Flores v. United States, 12 CIT ___, 693 F.Supp. 1165 (1988) (Asocolflores). In that opinion, the court remanded this matter for reexamination of the ITC's multiple domestic industry finding, also known as the like product determination, as well as for reexamination of the question of whether certain data should be analyzed on a cumulative basis for purposes of assessing threat of injury by reason of imports of miniature carnations from various countries. Following remand, the parties abandoned their objections to the finding of seven domestic flower industries, on the part of three commissioners, and of a single domestic flower industry, on the part of two commissioners.²

Thus, the only objection to the remand determination, which addressed both like product and cumulation, is the objection of Floral Trade Council of Davis (FTC), petitioner before ITC and a plaintiff and defendant intervenor here, to ITC's failure to cumulate for threat analysis purposes. FTC adheres to its earlier asserted claim of lack of substantial evidence supporting certain negative determinations regarding miniature carnations. These objections will be addressed separately.

I. Cumulative Analysis of Certain Data Regarding Threat of Injury by Reason of Unfairly Traded Miniature Carnations

As the court found in its earlier opinion herein, cumulative analysis of the volume and price effects of unfairly traded imports from all countries subject to investigation is not mandatory for threat of injury determination purposes. See Asocolflores at 1171-1172. Nonetheless, cumulative analysis may be applied in appropriate threat of injury investigations. It is error to fail to cumulate solely because of a general conclusion that any cumulation for threat analysis purposes is speculative. Such a view would, in effect, rule out cumulative analysis for threat purposes in all cases. Therefore, as the court held in its earlier opinion, ITC should consider whether cumulation would be appropriate under the facts of the particular case at hand. Implicitly, the court also required ITC to state the reason for its conclusion.

FTC states that on remand ITC did not follow the court's ruling, but rather applied a blanket rule under the guise of exercising discretion, and further that ITC applied an improper threshold for cumulation in the nature of an improper "contributing effects" test. Cf. Fundicao Tupy S.A. v. United States, 12 CIT ___, 678 F.Supp. 898, 901 (1988); USX Corp. v. United States, 12 CIT ___, 682 F.Supp. 60, 73 (1988) (both finding a test for cumulation which required each country's imports to have a causal link to material injury improper for material injury analysis).

As to the two negative opinions based on the existence of one all cut flower industry,³ one commissioner found the single cut flower industry in good condition and not sufficiently weakened to be threatened with injury from any source. The other commissioner found enough of a possibility of threat by reason of imports from Colombia and The Netherlands to discuss the issue, but found no likelihood for significant change as to imports from those countries. Thus, together or separately, such imports would pose no threat of material injury to the currently uninjured industry. It is clear from the opinion that this commissioner also found the U.S. industry in such a healthy condition, and the effect of imports from other countries so negligible, that threat of injury would not be found based on either a cumulative or a non-cumulative analysis. Thus, cumulation seems to be, for the most part, irrelevant for purposes of the single flower industry opinions. Although FTC apparently disagrees with this approach, FTC does not challenge it in this action. Thus, the focus here is on the determinations of the three commissioners who found separate flower industries, and particularly on the one opinion of the three which found no threat of injury with regard to miniature carnations from Ecuador, Israel, Costa Rica, and Peru.

First, as a preliminary matter, the remand determination appears to assert that relevant ITC decisions involving discretion need not be explained. Remand Determination at 16-17. The court believes that such a statement is misleading. Many choices of ITC involve "discretionary" considerations, but the choices generally must be explained so that the reviewing court may discern the path of reasoning which led to the final outcome.⁴ As the ITC apparently recognizes, it is also unwise not to explain hotly contested issues, as this will often result in remands for further explanation. That the administrative agency may make varying decisions based on the facts of particular cases does not permit the agency to act arbitrarily. In order to ascertain whether action is arbitrary, or otherwise not in accordance with law, reasons for the choices made among various potentially acceptable alternatives usually need to be explained. See Bowman Transportation v. Arkansas-Best Freight System, 419 U.S. 281, 285-86, 95 S.Ct. 438, 441-42, 42 L.Ed.2d 447 (1974) (agency must articulate a rational connection between the facts found and the choice made). Whether a particular issue needs to be specifically addressed in these types of cases does not rest on whether the issue involves discretionary considerations; it rests on factors such as the importance of the issue to the outcome of the case, whether it is a serious issue, whether it was a focal point of the parties' arguments, and, generally, whether the final result may be sufficiently reviewed without specific discussion of the issue.

Second, after making the statement that obviously caused the court some concern, ITC did explain its reasoning in sufficient detail to permit review. Addressing FTC's basic challenges, the court finds no attempt by ITC to apply a blanket rule against cumulation for threat determination purposes. Although such a prohibition was implied in the first determination, it is clearly not the approach taken on remand. The court also finds no application of an improper contributing effects test, that is, ITC did not find that imports from each country must be causally linked to threat of material injury on an individual basis before cumulative analysis may be undertaken.

The court views cumulative analysis for threat purposes as feasible in certain circumstances. For example, if imports are increasing at similar rates in the same markets and have relatively similar margins of underselling, it is likely that cumulation could be undertaken. This does not mean that each country's imports need threaten injury by themselves. Separately, none of them might threaten injury. Whether cumulative analysis is actually feasible in various circumstances is left to ITC to decide in other cases. Here, ITC found great disparity in the patterns of volume increases and decreases among imports from the various countries. The court does not read ITC's references to Colombian market share versus that of other countries as indicating application of an improper contributing effects test. Colombian exports were simply on a totally different plane from those of other countries in terms of market share, volume trends and otherwise. Finally, ITC notes that patterns of underselling, or lack thereof, varied greatly from one country to the next. Thus, price effects analysis on a cumulative basis would be difficult. The court has previously noted, as did ITC in its remand determination, the impossibility of cumulative analysis for purpose of certain statutory threat of injury indicators.⁵

FTC has not argued alternatively that the volume and price effects of imports from certain countries, comprising part of the entire pool of unfairly...