Branco Peres Citrus, S.A. v. U.S.

• Decision Date: 03 October 2001
• Docket Number: Court No. 99-09-00560.,SLIP OP. 01-121.
• Citation: 173 F.Supp.2d 1363
• Parties: BRANCO PERES CITRUS, S.A., Plaintiff, v. UNITED STATES of America, Defendant, and Florida Citrus Mutual, Defendant-Intervenor.
• Court: U.S. Court of International Trade

173 F.Supp.2d 1363

BRANCO PERES CITRUS, S.A., Plaintiff, v. UNITED STATES of America, Defendant, and Florida Citrus Mutual, Defendant-Intervenor.

SLIP OP. 01-121.

Court No. 99-09-00560.

United States Court of International Trade.

October 3, 2001.

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Willkie Farr & Gallagher, Washington, DC (Christopher Dunn and Julia K. Eppard), for Plaintiff.

Robert D. McCallum, Jr., Assistant Attorney General of the United States; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Janene M. Marasciullo); of counsel: Mildred Stewart, Office of the Chief Counsel for Import Administration, United States Department of Commerce, Washington, DC, for Defendant.

Barnes, Richardson & Colburn, Washington, DC (Matthew T. McGrath and Michael J. Chessler), for Defendant-Intervenor.

OPINION

EATON, Judge.

Plaintiff Branco Peres Citrus, S.A. ("Plaintiff") moves pursuant to USCIT R. 56.2 for judgment upon the agency record in an action challenging the final results of the United States Department of Commerce's ("Commerce") eleventh administrative review of the antidumping order on frozen concentrated orange juice from Brazil. See Frozen Concentrated Orange Juice From Brazil; Final Results and Partial Rescission of Antidumping Duty Administrative Review, 64 Fed.Reg. 43,650 (Aug. 11, 1999) ("Final Results"). The court has jurisdiction, see 28 U.S.C. § 1581(c) (1994), and, for the reasons set forth below, denies Plaintiff's motion.

BACKGROUND

Plaintiff is a Brazilian producer and exporter of frozen concentrated orange juice. In June 1998, at the request of Defendant-Intervenor Florida Citrus Mutual ("Defendant-Intervenor") and other domestic producers of frozen concentrated orange juice, Commerce initiated the eleventh administrative review of the antidumping order on frozen concentrated orange juice from Brazil. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 63 Fed.Reg. 35,188 (June 29, 1998).¹ The review covered U.S. sales of frozen concentrated orange juice made by Plaintiff and five other foreign producers and exporters between May 1, 1997, and April 30, 1998. See Frozen Concentrated Orange Juice From Brazil; Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 64 Fed.Reg. 5,767 (Feb. 5, 1999) ("Preliminary Results").

At the outset of its investigation, Commerce sent an antidumping questionnaire to Plaintiff and each of the other foreign producers being reviewed. In its accompanying letter to Plaintiff, Commerce requested responses to sections A, B, and C of the questionnaire, which related to general information, sales in the home market or to third countries, and sales to the United States, respectively. (Letter from Maeder to Dunn of 6/12/98, at 1, Pl.'s App., Tab 10.) At that time, Commerce did not request any data relating to Plaintiff's cost of production. (Id. at 1-2 ("You are not currently required to respond to section D (Cost of Production/Constructed Value).").) Commerce did, though, advise Plaintiff, "if the petitioner alleges that your sales in the home or third country market are at prices below the cost of production, we may request that you respond to section D at a later date." (Id. at 1-2.) Approximately two weeks later, on July 1, 1998, Plaintiff sold its frozen concentrated orange juice business.² (Pl.'s Mem. Supp. Mot. J. Agency R. at 7; Pl.'s Reply Mem. Supp. Mot. J. Agency R. at 5.) According to Plaintiff, "[i]ncluded in this sale were all of [its] cost of production records." (Pl.'s Mem. Supp. Mot. J. Agency R. at 7.) Plaintiff did, however, "retain copies of its price documents because of the need to respond to [Commerce's] antidumping questionnaire." (Id.) Plaintiff timely responded to Commerce's initial questionnaire, see Preliminary Results, 64 Fed. Reg. at 5,767, and to a supplemental questionnaire delivered shortly thereafter. See id.

In the interim, the domestic producers submitted to Commerce a letter alleging that Plaintiff, during the period of review, had made sales at prices below its cost of production. (See letter from McGrath & Chessler to Daley of 9/1/98, Pl.'s App., Tab 8.) Commerce initiated a cost of production investigation, see Preliminary Results, 64 Fed.Reg. at 5,767, and, on October 15, 1998, requested from Plaintiff a response to section D of its initial questionnaire, which related to cost of production. (See letter from Maeder to Dunn of 10/15/98, Pl.'s App., Tab 12.) By letter dated November 12, 1998, Plaintiff informed Commerce that it was "unable to respond to [Commerce's] questionnaire on cost of production, owing to lack of information." (Letter from Dunn to Daley of 11/12/98, at 1, Pl.'s App., Tab 2.) Plaintiff reported that it had sold its frozen concentrated orange juice operations and was "unable to locate any documents relating to the cost of producing [frozen concentrated orange juice] in Brazil. Under the circumstances," Plaintiff stated, "it is simply not possible for us to respond to [Commerce's] cost questionnaire." (Id. at 2; see also Pl.'s Mem. Supp. Mot. J. Agency R. at 9 (asserting that its "factory, administrative offices and all records [had been transferred] as part of this sale") (quoting letter from Dunn to Daley of 11/12/98, at 2, Pl.'s App., Tab 2).) Plaintiff did not return section D, and Commerce did not solicit any further explanation.

In February 1999, Commerce issued its preliminary determination that Plaintiff had, during the period of review, made sales at prices below normal value,³ see Preliminary Results, 64 Fed.Reg. at 5,767, and assigned to Plaintiff a 65.2 percent dumping margin based on adverse inferences drawn from facts otherwise available.⁴ Commerce stated that, "[b]ecause [Plaintiff has] failed to respond to certain questionnaires and [has] refused to participate fully in this administrative review ... the use of total facts available is appropriate." Id. at 5,768. In addition, Commerce stated, Plaintiff's "failure ... to participate in the review and to respond to [Commerce's] questionnaires demonstrates that [it has] failed to act to the best of its ability in this review and, therefore, an adverse inference is warranted." Id. Commerce also reported that, in calculating Plaintiff's dumping margin, it had declined to follow the "normal practice," see id., of selecting as the adverse facts available margin the highest margin from the current or any prior segment of the proceeding, in this case, 2.52 percent, because use of such margin would allow Plaintiff to "benefit from [its] lack of cooperation." Id. Consequently, Commerce stated, it had used data on the record of the proceeding for the purpose of calculating sales-specific dumping margins, namely, the publicly available industry-wide cost data provided by the domestic producers in the cost allegation, as well as the company-specific sales data provided by Plaintiff and one other foreign producer. See id. at 5,768. Commerce then selected the highest overall sales-specific margin calculated in this manner, 65.2 percent, as the facts available rate for Plaintiff and the other "non-cooperating respondents." Id.

In its subsequent comments to Commerce, Plaintiff reiterated that it was "unable to respond to [Commerce's] questionnaire on cost of production, owing to lack of information." (Letter from Dunn to Daley of 3/30/99, at 4, Pl.'s App., Tab 1 (quoting letter from Dunn to Daley of 11/12/98, at 1, Pl.'s App., Tab 2).) Nonetheless, Commerce in its final results maintained that, with respect to Plaintiff, use of total facts available, as well as adverse inferences, was reasonable, supported by evidence on the record, and otherwise in accordance with law. See Final Results, 64 Fed.Reg. at 43,655. Commerce did, however, reconsider the methodology originally used to select an adverse facts available rate for Plaintiff, see id., and assigned Plaintiff a final margin based on Plaintiff's own sales data alone (and not, as had been the case in its preliminary determination, on the sales data provided by Plaintiff and one other foreign producer), and on the publicly available industry-wide cost data provided by the domestic producers in the cost allegation. See id. at 43,657. Specifically, Commerce used this data to calculate transaction-specific dumping margins for Plaintiff, and then selected from among these margins, as Plaintiff's facts available rate, its highest transaction-specific dumping margin. The final rate thus assessed was 39.18 percent. See id. at 43,659.

Plaintiff subsequently commenced this action. Plaintiff's complaint challenges two aspects of Commerce's final results: (1) Commerce's determination that Plaintiff did not comply to the best of its ability with Commerce's request for information, and its consequent resort to the use of adverse inferences;⁵ and (2)

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Commerce's selection of the highest transaction-specific dumping margin, calculated with the use of Plaintiff's own sales data and the cost data provided by the domestic producers in the cost allegation, as the facts available rate for Plaintiff. (See Compl. ¶ 7.)

As to its first argument, Plaintiff maintains that it was "not in possession of information concerning its cost of production because it had sold [its frozen concentrated orange juice] facility, including all office functions and records, between the time [Commerce] sent out its initial questionnaire (which did not include a request for cost of production information) and the time that a cost of production investigation was first requested by petitioners." (Pl.'s Mem. Supp. Mot. J. Agency R. at 3.) Plaintiff further claims that it "had no reason to expect that a cost of production investigation would be requested or initiated." (Id. at 4.)

In support of its second argument, that, even if the use of adverse inferences were "somehow justifiable" ...