Queen's Flowers De Colombia v. U.S.

• Decision Date: 25 August 1997
• Docket Number: Court No. 96-08-01921.,Slip Op. 97-120.
• Citation: 981 F.Supp. 617
• Parties: QUEEN'S FLOWERS DE COLOMBIA, et al., Plaintiffs, v. UNITED STATES, Defendant, and Floral Trade Council, Defendant-Intervener.
• Court: U.S. Court of International Trade

981 F.Supp. 617

QUEEN'S FLOWERS DE COLOMBIA, et al., Plaintiffs, v. UNITED STATES, Defendant and Floral Trade Council, Defendant-Intervener.

Slip Op. 97-120.

Court No. 96-08-01921.

United States Court of International Trade.

August 25, 1997.

COPYRIGHT MATERIAL OMITTED

Arnold & Porter, (Micheal T. Shor, William L. Busis), Washington, DC, for Plaintiffs.

Frank W. Hunger, Assistant Attorney General of the United States; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice; Velta Melnbrencis, Assistant Director, (Karen L. Bland, Jeffrey C. Lowe and Sanjay L. Mullick), Commercial Litigation Branch, Civil Division, United States Department of Justice; Of Counsel, Lucius B. Lau, Office of the Chief Counsel for Import Administration, United States Department of Commerce, for Defendant.

Stewart and Stewart, (Terence P. Stewart, James R. Cannon, Jr., Amy S. Dwyer, Mara M. Burr) for Defendant-Intervener.

OPINION

POGUE, Judge.

This matter is before the court on the motion of plaintiffs, 20 individual privately-held producers and exporters of fresh cut flowers from Colombia, and three related importers in the United States, for judgment on the agency record, pursuant to U.S. CIT Rule 56.2. Plaintiffs challenge certain aspects of the Department of Commerce's ("Department" or "Commerce") final results of antidumping administrative reviews in Certain Fresh Cut Flowers from Colombia, 61 Fed.Reg. 42,833 (Dep't. Commerce 1996)(final results admin. reviews).

The 20 producers/exporters consist of the following Colombian companies: (1) Queen's Flowers de Colombia Ltda., (2) M.G. Consultores Ltda., (3) Agroindustria del RioFrio Ltda., (4) Cultivos Generales Ltda., (5) Floranova Ltda., (6) Flores Atlas Ltda., (7) Flores Calima S.A., (8) Flores de Bojaca Ltda., (9) Flores del Hato Ltda., (10) Flores el Aljibe S.A., (11) Flores el Cacique Ltda., (12) Flores Canelon Ltda., (13) Flores el Cipres Ltda., (14) Flores el Roble, (15) Flores el Tandil Ltda., (16) Flores Jayvana Ltda., (17) Flores la Mana S.A., (18) Flores la Valvanera Ltda., (19) Jardines de Chia Ltda., and (20) Jardines Fredonia Ltda.

The three U.S. importers are: (1) Queen's Flowers Corp., based in Miami, Florida, (2) Atlas Flowers, Inc. d/b/a/Golden Flowers, located in Miami, Florida, and (3) Florexpo, located in Carlsbad, California.

In its Final Results for the consolidated fifth, sixth and seventh administrative reviews of the antidumping order on Certain Fresh-Cut Flowers From Colombia, 61 Fed. Reg. 42,833, the Department of Commerce International Trade Administration ("ITA") determined that all 20 flower-producing companies were related, and collapsed them into a single entity called the "Queen's Flowers Group." ITA did not base the dumping margins for this group on data submitted by the companies. Instead, ITA applied a best information available rate ("BIA") of 76.60 percent to all 20 companies for each of the three one-year periods of review, and for future cash deposits. The margins found for other Colombian producers were in the range of 0 to 5 percent.

BACKGROUND

Following investigations by the Department of Commerce and the U.S. International Trade Commission, an antidumping duty order was entered against Certain Fresh Cut Flowers From Colombia in 1987. That antidumping duty order covered standard carnations, miniature carnations, standard chrysanthemums, and pompom chrysanthemums. See Certain Fresh Cut Flowers From Colombia, 52 Fed.Reg. 6492 (Mar. 18, 1987) (amend. final determ.).

Prior to the August 19, 1996 publication of the final results in the consolidated fifth, sixth, and seventh administrative reviews of the Fresh Cut Flowers From Colombia antidumping duty order, covering entries made between March 1, 1991 and February 28, 1994, plaintiffs' exports to the United States were subject to antidumping duty deposit rates ranging between 0% and 3.13%.

Nine of the twenty plaintiff producers were included within Commerce's Notices of Initiation for the fifth, sixth, or seventh administrative reviews, which initiated administrative reviews for several hundred Colombian producers/exporters of subject merchandise. These nine companies were: (1) Queen's Flowers de Colombia Ltda., (2) Jardines de Chia Ltda., (3) Jardines Fredonia Ltda., (4) Agroindustria del RioFrio Ltda., (5) Flores Canelon Ltda., (6) Flores del Hato Ltda., (7) Flores la Valvanera Ltda., (8) M.G. Consultores Ltda., and (9) Cultivos Generales Ltda. (previously Flores Generales). Cultivos Generales and Fredonia, however, certified that they did not produce or export subject merchandise to the United States during the periods of review. No review was requested for the remaining 11 companies, and thus none were included in any of ITA's three notices of initiation.¹

In the preliminary results issued on June 8, 1995, ITA determined to collapse eight of the original producer plaintiffs into one entity, the Queens's Flower Group. All of the plaintiff producers in Commerce's Notices of Initiation were included except Cultivos Generales. Although all the companies provided responses to ITA's initial questionnaire and supplemental questionnaires, ITA preliminarily determined that these respondents had impeded its investigation, and applied a first-tier best information available ("BIA") rate to the eight companies. First-tier BIA is the most adverse BIA level and is applied to companies that refuse to cooperate with Commerce's requests for information or significantly impede an administrative review. See Allied-Signal Aerospace Co. v. United States, 996 F.2d 1185 (Fed.Cir.1993). This rate, equal to the highest rate ever determined for any producer in any review, was 75.92 percent for the fifth administrative review period, and 83.61 percent for the sixth and seventh administrative review periods. Certain Fresh Cut Flowers From Colombia, 60 Fed.Reg. 30270, 30272-73 (Dep't.Commerce, 1995) (prelim. results admin. review).

Previously, Commerce had delivered a November 17, 1994, decision memorandum to the eight companies explaining why the companies were collapsed, and a December 5, 1994, analysis memorandum itemizing deficiencies in their questionnaire responses which, according to Commerce, justified the use of BIA.

On May 26, 1995, ITA issued Section A questionnaires covering all three review periods to the 12 producer plaintiffs not covered in the preliminary determination. It issued supplemental questionnaires to these companies on July 21, 1995. Timely responses were provided by all companies. On August 3, 1995 the ITA issued a decision memorandum analyzing the relatedness of the original eight parties. That memorandum determined that the companies were related. On February 1, 1996, the ITA issued a memorandum analyzing the relatedness of the twelve other companies² to the earlier eight. That memorandum determined that all twenty companies were related.

On June 28, 1996, the ITA issued a memorandum in response to comments raised about the use of BIA for the Queen's Flowers Group. This memorandum focused in large measure on the failure of the companies to provide related party information in their responses to questionnaires.

The Plaintiffs, Queen's Flowers Group, et. al., argue that the twenty companies were unlawfully collapsed, and that BIA was applied to the companies unlawfully because the companies gave complete responses to the questionnaires.

DISCUSSION

I. Collapsing Parties

Plaintiffs argue that Commerce does not have the legal authority to collapse 20 companies and treat them as a single entity. (Pls.' Br. Supp. Rule 56.2 Mot. J. Agency R. [hereinafter Pls.' Brief] at 21). Specifically, Plaintiffs argue, ITA has no statutory authority to collapse multiple producers or exporters.

"If the statute is silent or ambiguous with respect to [a] specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute." Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837, 843, 104 S.Ct. 2778, 2782, 81 L.Ed.2d 694 (1984). Commerce acknowledges that "[i]t is the Department's long standing practice to calculate a separate dumping margin for each manufacturer or exporter investigated." Final Results, 61 Fed.Reg. at 42,853. However, the statute itself does not require that Commerce calculate company-specific margins, see Certain Granite Products from Italy, 53 Fed.Reg. 27,187, 27,189 (Dep't. Commerce 1988)(final determ.); nor does it contain a standard for Commerce to apply in determining what constitutes a "company" for purposes of the antidumping law. In this case Commerce's decision to define "company" to include several closely related companies is a permissible application of the statute. Commerce treats closely related parties as a single entity in order to "ensure that [Commerce] reviews the entire producer or reseller, not merely a part of it." Final Results at 42,853. Commerce's authority to ignore the separate legal existence of some parties for purposes of calculating dumping margins arises out of the "basic purpose of the statute — determining current margins as accurately as possible," Rhone Poulenc, Inc. v. United States, 8 Fed. Cir. (T) 61, 67, 899 F.2d 1185, 1191 (1990), as well as the Department's responsibility to prevent circumvention of the antidumping law. See Mitsubishi Electric Corp. v. United States, 12 CIT 1025, 1046, 700 F.Supp. 538, 555 (1988) ("The ITA has been vested with authority to administer the antidumping laws in accordance with the legislative intent. To this end, the ITA has been certain amount of discretion [to act] ... with the purpose in mind of preventing the intentional evasion or circumvention of the antidumping duty law."), aff'd 8 Fed. Cir. (T) 45, 898 F.2d 1577 (1990).

The statute contains several provisions that permit or require Commerce to ignore transactions between related buyers and sellers in the home...