ASSOCIATION COLOMBIANA de EXPORTADORES v. US, Court No. 87-04-00622.

• Decision Date: 29 June 1989
• Docket Number: Court No. 87-04-00622.
• Citation: 717 F. Supp. 834,13 CIT 526
• Parties: The ASSOCIATION COLOMBIANA de EXPORTADORES de FLORES, et al., Plaintiffs, v. The UNITED STATES, et al., Defendants, and Floral Trade Council of Davis, California, Defendant-Intervenor.
• Court: U.S. Court of International Trade

717 F. Supp. 834

13 CIT 526

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

Court No. 87-04-00622.

United States Court of International Trade.

June 29, 1989.

Arnold & Porter, Patrick F.J. Macrory, Spencer S. Griffith and Gwyn F. Murray, Washington, D.C., for Association Colombiana de Exportadores de Flores, et. al.

Heron, Burchette, Ruckert & Rothwell Thomas A. Rothwell, Jr. and James M. Lyons, Washington, D.C., for Floramerica.

Stuart E. Schiffer, Acting Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch (Jeanne E. Davidson) Civ. Div., U.S. Dept. of Justice; Anne W. White, Office of the Chief Counsel for Import Admin., U.S. Dept. of Commerce, Washington, D.C., for defendant.

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

OPINION

BACKGROUND

RESTANI, Judge:

Representatives of both the Colombian and the domestic fresh cut flower industry challenge the results of the United States International Trade Administration (ITA) remand determination, wherein ITA amended its previous assessment of dumping rates for some respondents, while leaving other respondents' rates the same. The court's original opinion in this matter ordering remand to ITA is Asociacion Colombiana de Exportadores de Flores v. United States, 13 CIT ___, 704 F.Supp. 1114 (1989) hereinafter referred to as Asocolflores I. That opinion contains the relevant factual information applicable to this case, and almost all of the relevant legal discussion, and should be read in conjunction with this decision. Asocolflores is a Colombian producer and exporter organization, and the lead plaintiff herein. For ease of argument, plaintiffs generally will be referred to as "Asocolflores," "plaintiffs," or "respondents."¹ Where appropriate the court will refer to individual producers or exporters. Floral Trade Council, also a plaintiff, but not referred to as such in these consolidated actions, represents domestic flower interests and is referred to as "FTC." Defendant is the United States of America.

A. Asocolflores' Challenge to the Rate for Non-Responding Companies

In its original determination, for companies which were included in its sample for investigation but which did not respond properly to ITA's requests for information, ITA utilized the highest rate of dumping then reflected in the record. This rate was the highest rate for any company whose data was successfully verified. The company with the highest such rate was Uniflor, an exporter. Upon remand, because of a change in methodology approved by the court, see discussion Section B infra, Uniflor's rate dropped forty percentage points to approximately forty-six percent.² See Remand Determination at 10-11. This remains the highest rate derived from verified data.

On remand, for these non-responding companies ITA decided to use petitioner's rate as the highest rate of record. Id. at 11. Pursuant to statute, 19 U.S.C.A. § 1677e (West Supp.1989), ITA may use "best information available" (BIA) to assign a dumping rate to such companies if they do not provide ITA with the information it requests. The statute also states that information "submitted in support of the petition" may be chosen by ITA as best information available for purposes of a final determination. 19 U.S.C.A. § 1677e(b).

Asocolflores objects to ITA's use of petitioner's rate as BIA on the basis that a verified rate should be used because such a rate by its very nature (i.e. that it is derived from information confirmed by ITA) is "better" information than petitioner's rate, which is based only on data provided by petitioners. See Plaintiffs' brief at 3-4. Defendant for its part claims that this is a discretionary matter, and that its newly articulated policy is to use the highest rate available for non-cooperative parties, which in this case is the rate alleged in the petition. ITA further avers that under this policy, parties which are cooperative but yet cannot substantially comply with ITA's requests, likely would receive rates lower than the petition rate. As this policy is newly articulated there are no court precedents directly on point.³

As far as the non-responding parties are concerned they are in a particularly difficult position. Presumably, petitioner's rate was known and any interested respondent could have complied with ITA's request if it had data to establish a lower rate. None of these non-complying respondents or anyone representing them has demonstrated to the court that it should relieve these particular companies of petitioner's rate, if such companies are considered on an individual basis. In fact, it appears that these companies have not participated directly in the administrative or judicial proceedings and are not in a position to object on behalf of themselves. The inquiry, however, does not end here. The rates chosen for these non-complying respondents have application beyond their effects on the non-complying respondents themselves. The BIA rates for non-complying respondents were averaged with other rates from companies comprising ITA's random sample to arrive at an "all other rate." This rate is applied to those companies which were not part of ITA's random sample and which were not asked to participate in ITA's investigation.

In Asocolflores I, the court approved inclusion of the BIA rate assigned to non-responding companies (which then was Uniflor's verified rate) in ITA's calculation of an average "all other rate" for those companies that were not part of ITA's sample. At that time the court found ITA did not err in finding Uniflor sufficiently representative so as to be includable in the sample, and that the integrity of the sample required inclusion of rates for non-responding companies that were within the sample. See Asocolflores I, 704 F.Supp. at 1121, n. 11, and 1126. The court finds, however, that under the facts of this case use of petitioner's unverified rate, as part of the averaged rate, simply because it is the "highest" rate, is unreasonable.

One question to be answered here is whether, in the absence of proof of collusion among the parties, ITA should use an unverified rate in the random sample average if a verified rate is available. The court concludes that, in general, too great a burden would be placed upon the agency if proof of collusion were required before petitioner's rate is used in such a situation. But in a case such as this where, for at least three of the four non-responding companies, there seems to be demonstrable proof that the parties were not colluding, use of petitioner's rate seems to be particularly inappropriate. The record indicates that these companies had their own reasons for non-cooperation which were unrelated to the margin level, and the fact-pattern makes collusion nearly an impossibility in this case. The four companies either had business difficulties or no continuing sales of the relevant merchandise, so they may not have found it worth their while to respond.

In other cases, if it is acceptable for ITA to use petitioner's rate for individual companies and a lack of collusion is not so apparent from the fact pattern, the preferred methodology may be to use petitioner's rate in the "all other" average, because it is the rate actually assigned to those companies. In the present case, however, because the verified rates are so much lower than petitioner's rate and because some or all of the non-responding companies appear to have had no motivation to respond, even if their rates would have been far below petitioner's, blanket use of petitioner's rate to calculate the "all other rate" is not appropriate.

On remand, ITA should look at the reasons of record for non-response. If the record indicates that a company is out of business, that it made a one-time sale, or that it had a similar reason unrelated to deposit rates for not responding, a verified rate should be used for purposes of establishing an "all other rate."⁴ In other cases, not now before the court, exigencies might or might not permit the use of petitioner's rate where the all other rate is based on a random sample. When dealing with the partial application of quasi-punitive rates to innocent parties, that is, those not part of the sample, further inquiry and explanation is required by ITA before the final average "all other" rate is determined.⁵

B. Asocolflores Challenge to Uniflor's Material Cost Estimate

In its original determination ITA used Uniflor's unverified estimate of increases in material costs for the first half of 1986. Uniflor's data was generally verifiable; thus, it was not assigned a BIA rate. To fill in some missing data, the court directed ITA on remand to use averages of verified data, if they revealed higher 1986 costs than estimated by Uniflor. Asocolflores I, 704 F.Supp. at 1118. The court found this to be a fair approach, as well as being in keeping with ITA's own statement as to its methodology for those companies which had been fully verified, except for minimal items. Plaintiffs now allege that it is unfair of ITA to continue to use the estimate, just because the average of verified cost increases is lower than Uniflor's estimate. The court concludes that this objection is too late. If parties with an interest in Uniflor's rate wished to abandon Uniflor's own estimate of its costs, they should have so advised the court prior to remand. Furthermore, if they had no confidence in the estimate, prior to final determination they should have asked the agency to use an average rate.

C. Floramerica's and FTC's Challenges as to Correction of ITA Clerical Errors

In Asocolflores I, the court instructed ITA to correct certain clerical errors noted by the parties regarding Floramerica's dumping...