Asociacion Colombiana de Exportadores de Flores v. U.S.

• Decision Date: 11 April 1990
• Docket Number: No. 89-1742,89-1742
• Citation: 901 F.2d 1089
• Parties: The ASOCIACION COLOMBIANA de EXPORTADORES de FLORES, Plaintiff, Floramerica, S.A., Cultivos de Caribe, S.A., and Jardines de Colombia, S.A., Plaintiffs-Appellants, v. The UNITED STATES, Defendant-Appellee, and Floral Trade Council of Davis, California, Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1089

901 F.2d 1089

12 ITRD 1150

The ASOCIACION COLOMBIANA de EXPORTADORES de FLORES, Plaintiff Floramerica, S.A., Cultivos de Caribe, S.A., and Jardines de Colombia, S.A., Plaintiffs-Appellants, v. The UNITED STATES, Defendant-Appellee and Floral Trade Council of Davis, California, Defendant-Appellee.

No. 89-1742.

United States Court of Appeals Federal Circuit.

April 11, 1990.

James M. Lyons, Heron, Burchette, Ruckert & Rothwell, Washington, D.C., argued for plaintiffs-appellants. With him on the brief were Thomas A. Rothwell, Jr. and Melanie Morris.

Jeanne E. Davidson, Commercial Litigation Branch, Dept. of Justice, Washington, D.C., argued for defendant-appellee, U.S. With her on the brief were Stuart M. Gerson, Asst. Atty. Gen. and David M. Cohen, Director. Also on the brief were Wendell L. Willkie, II, Gen. Counsel, Stephen J. Powell, Chief Counsel for Import Admin. and Anne White, Atty.-Advisor, Office of the Chief Counsel for Import Admin., Dept. of Commerce, of counsel. Jimmie V. Reyna, Stewart & Stewart, Washington, D.C., argued for defendant-appellee, Floral Trade Council of Davis, Cal. With him on the brief was Terence P. Stewart.

Before MARKEY, Chief Judge, BENNETT, Senior Circuit Judge, and PLAGER, Circuit Judge.

BENNETT, Senior Circuit Judge.

This appeal is from the final judgment of the United States Court of International Trade denying appellants' motion for summary judgment on the agency record and sustaining the final determination of the International Trade Administration (ITA). Asociacion Colombiana de Exportadores de Flores v. United States, 704 F.Supp. 1114 (Ct.Int'l Trade 1989). We affirm.

BACKGROUND

This case arises out of the antidumping investigation commenced by the ITA in response to a petition by the appellee Floral Trade Council of Davis, California. The products covered by the investigation were fresh cut flowers produced by certain Colombian flower growers, including the appellants, Floramerica, S.A., Cultivos de Caribe, S.A., and Jardines de Colombia, S.A. (collectively "Floramerica" or "appellants"). Following the investigation and a hearing in which the appellants participated, the ITA issued its final affirmative determination of sales at less than fair value. Certain Fresh Cut Flowers from Colombia, 52 Fed.Reg. 6842 (Mar. 5, 1987), amended, 52 Fed.Reg. 8492 (Mar. 18, 1987).

The appellants commenced an action in the Court of International Trade contesting the less than fair value determination of the ITA. The appellants contended that the ITA had not deducted certain indirect selling expenses of a related company, Crown, when it calculated the foreign market value of the flowers. The appellants contended that the identical amount had been deducted from the U.S. price, and the resulting differential between the U.S. price and the foreign market value caused the ITA to find that sales had been made in the United States at less than fair value.

The Court of International Trade stated that it appeared clear that, had the ITA known at the time of its determination all of the facts that were so clearly described by Floramerica before the Court of International Trade, the ITA would have granted a larger indirect selling expense offset than it did. According to the court, the ITA erred in not deducting the indirect selling expenses of Crown from the foreign market value. Nevertheless, the court held that the deciding factor in placing responsibility for the error was Floramerica's last minute submission of information to the ITA, which did not clearly indicate whether the Crown expenses were included in the foreign sales figures. The Court of International Trade observed that there was "no room for lack of clarity" by Floramerica, the only party in a position to explain its own data. The Court of International Trade found that the ITA did not abuse its discretion in refusing to recalculate the sales margins when the error made by the ITA was attributable to Floramerica's late submission of ambiguous data. Floramerica has now appealed.

OPINION

A. The Statutory and Regulatory Background

The antidumping laws, 19 U.S.C. Secs. 1673-1677k (1988), are directed to foreign products that are sold in the United States at less than fair value. See generally Smith-Corona Group v. United States, 713 F.2d 1568 (Fed.Cir.1983), cert. denied, 465 U.S. 1022, 104 S.Ct. 1274, 79 L.Ed.2d 679 (1984). To determine whether sales are at less than fair value, the ITA compares the price of the goods in the United States with their foreign market value. The foreign market value may be based on sales in the home market of the party under investigation, sales in third countries, or on a constructed value of the imported product.

The United States price is determined by either the purchase price or the exporter's sales price (ESP). 19 U.S.C. Sec. 1677a(a). The ESP is the price at which the goods are purchased by the first unrelated buyer following importation. If the ESP is used, the statute requires a reduction in the U.S. price by the amount of indirect selling expenses incurred by or on account of the exporter in the United States. 19 U.S.C. Sec. 1677a(e)(2). Such indirect selling expenses may include salespersons' salaries, warehousing, and personnel assistance.

The statute does not provide for a similar reduction in the foreign market value, so the statutory reduction in ESP will result in an apparent increase in the dumping margin. To overcome this apparent distortion, the Commerce Department, by regulation, has provided for an adjustment to the foreign market value when the U.S. price is reduced by indirect selling expenses. The regulation in effect at the time of the ITA's final determination provided:

In making comparisons using exporter's sales price, reasonable allowance will be made for all actual selling expenses incurred in the home market up to the amount of the selling expenses incurred in the United States market.

19 C.F.R. Sec. 353.15(c) (1989) (superseded text). This allowance is known as the "ESP offset." The regulations also provided that "[t]he person who alleges entitlement to any adjustment pursuant to Secs. 353.14 through 353.19 must establish entitlement thereto to the satisfaction of the Secretary." 19 C.F.R. Sec. 353.13 (1989) (superseded text).

B. The Appellants' Distribution System

Floramerica, S.A., Cultivos de Caribe, S.A., and Jardines de Colombia, S.A. are three related Colombian flower producers. Sunburst Farms Miami is a related company that imports and distributes the flowers in the United States and Canada. Sun Petals sells to grocery stores. Sunburst Farms Holland is a related company that imports and distributes in Europe. Crown a Panamanian corporation, is an intermediary between the Colombian producers and the Sunburst distributors. Crown is related to the other companies.

C. The Evidence Before the ITA

Soon after the investigation was initiated in June 1986, the ITA issued a detailed questionnaire seeking information relating to Floramerica's costs, prices, and selling expenses. Floramerica responded, and the ITA sent deficiency letters requesting additional information and indicating that it...