Tak Fat Trading Co. v. U.S., Slip Op. 03-134.
| Decision Date | 17 October 2003 |
| Docket Number | Slip Op. 03-134.,Court No. 00-07-00360. |
| Citation | 294 F.Supp.2d 1352 |
| Parties | TAK FAT TRADING CO., Mei Wei Foods Industry Co., Ltd., Leung MI International, Tak Yuen Corp. and Genex International Corp., Plaintiffs, v. UNITED STATES, Defendant, and Coalition for Fair Preserved Mushroom Trade, Intervenor-Defendant. |
| Court | U.S. Court of International Trade |
Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP (Max F. Schutzman, Erik D. Smithweiss and Mark E. Pardo), New York City, for Plaintiffs.
Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director, and Velta A. Melnbrencis, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice; and Office of Chief Counsel for Import Administration, U.S. Department of Commerce (John F. Koeppen), for Defendant, of counsel.
Collier Shannon Scott, PLLC (Michael J. Coursey and Adam H. Gordon), Washington, DC, for Intervenor-Defendant.
Before the court is plaintiffs' USCIT Rule 56.2 motion for judgment on the administrative record wherein they seek vacation of the determination1 by the International Trade Administration, U.S. Department of Commerce ("ITA") that their product is within the scope of the Notice of Amendment of Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Certain Preserved Mushrooms From the People's Republic of China, 64 Fed.Reg. 8,308 (Feb. 19, 1999).
This antidumping-duty order was precipitated by petition(s) filed by domestic U.S. mushroom producers requesting investigation of certain preserved mushrooms imported from Chile, China, India and Indonesia. The petitioners sought to exclude from the investigation "`marinated', `acidified' or `pickled' mushrooms, which are packed with solutions such as oil, vinegar or acetic acid (HTS heading 2001.90.39)." Plaintiffs' Appendix, tab 1, p. 13. In a letter supplementing the petition(s), they stated that marinated, acidified and pickled mushrooms are all "prepared or preserved by means of vinegar or acetic acid" and are therefore "covered under HTS heading 2001.90.39". Plaintiffs' Appendix, tab 2, p. 4. The petition also contained a footnote stating that its Plaintiffs' Appendix, tab 1, p. 12.
Despite those particular references to the Harmonized Tariff Schedule of the United States ("HTSUS") and the FDA's standards of identity, neither the ITA's preliminary nor its amended final determination of sales at less than fair value includes them. Rather, the latter is stated to encompass
certain preserved mushrooms whether imported whole, sliced, diced, or as stems and pieces. The preserved mushrooms covered under this order are the species Agaricus bisporus and Agaricus bitorquis. "Preserved mushrooms" . . . have been prepared or preserved by cleaning, blanching, and sometimes slicing or cutting. These mushrooms are then packed and heated in containers including but not limited to cans or glass jars in a suitable liquid medium, including but not limited to water, brine, butter or butter sauce. Preserved mushrooms may be imported whole, sliced, diced, or as stems and pieces. Included within the scope of the investigation are "brined" mushrooms, which are presalted and packed in a heavy salt solution to provisionally preserve them for further processing.
Excluded from the scope of this investigation are the following: (1) all other species of mushroom, including straw mushrooms; (2) all fresh and chilled mushrooms, including "refrigerated" or "quick blanched mushrooms"; (3) dried mushrooms; (4) frozen mushrooms; and (5) "marinated," "acidified" or "pickled" mushrooms, which are prepared or preserved by means of vinegar or acetic acid, but may contain oil or other additives.
The merchandise subject to this investigation is classifiable under subheadings 2003.10.0027, 2003.10.0031, 2003.10.0037, 2003.10.0043, 2003.10.0047, 2003.10.0053, and 0711.90.4000 of . . . HTS[US]. Although the[se] subheadings are provided for convenience and Customs purposes, the Department's written description of the merchandise under the order is dispositive.
In its preliminary determination of material injury, the International Trade Commission ("ITC") concluded that, although there are some physical and manufacturing-process similarities between marinated, acidified or pickled mushrooms and the preserved mushrooms under investigation,
on the whole there is little interchangeability, with consumers perceiving the two products differently. There are also differences in physical characteristics, particularly taste, between the two products. Consequently, for purposes of these preliminary determinations we find that marinated, acidified and pickled mushrooms are not within the like product subject to these investigations.
Certain Preserved Mushrooms From Chile, China, India, and Indonesia, ITC Pub. No. 3086, p. 10 (Feb.1998). Its final determination in this matter adopted, for likeproduct,2 the reasoning of Certain Preserved Mushrooms From Chile, ITC Pub. No. 3144, p. 6 (Nov.1998), which stated that,
[a]lthough preserved mushrooms and marinated mushrooms share some common channels of distribution and production facilities, they have different tastes that limit marinated mushrooms' end uses, very limited inter-changeability, are perceived to be different products by both producers and customers, and sell in different price ranges. We believe that the distinctions between preserved and marinated mushrooms establish a "clear dividing line." We consequently do not include marinated mushrooms in the domestic like product.
The plaintiffs herein are a producer, an exporter, and importers of
marinated or acidified mushrooms of the species agaricus bisporus that are . . . washed, blanched in water . . . and then placed in . . . cans [that] are then filled with a marinade consisting of . . . water[,] salt [ ], sugar [ ], vinegar [ ], acetic acid [ ], yeast extract [ ], citric acid [ ], MSG [ ], vitamin C[ ], flavorings [ ], and spices [ ]. . . . The finished equilibrium pH of the mushrooms is controlled at or below 4.6.4
Defendant's Appendix, Exhibit 1, p. 2 (). The footnote 4 to the foregoing product description states:
If an acidified food is found to have a pH above 4.6, it must be subjected to further thermal processing as a low acid food for safety reasons. 21 C.F.R. § 114.-89. The manufacturer of the subject product both acidifies and thermally processes its mushrooms.
Id. The plaintiffs requested the scope determination by the ITA, pointing out that the petition(s) "excluded marinated and acidified mushrooms not meeting the [FDA's] standard for canned mushrooms",3 which does not provide for vinegar or acetic acid.4 Whereupon their position was and is, "[b]ecause the subject marinated mushrooms . . . do not meet that FDA standard, they are outside the scope of the antidumping duty order." Id.
After a preliminary ruling and considering comments thereon, the ITA issued its final determination that
the "marinated or acidified" mushrooms produced, exported or imported by [the plaintiffs] are within the scope of the antidumping duty order on [certain preserved mushrooms] from the PRC based on their acetic acid content level.
Plaintiffs' Appendix, tab 13, second page. It is based on the petitioners' use of HTSUS subheading 2001.90.39 to define the products they intended to exclude from this matter and the agency's "appropriat[ion of] the phrase `prepared or preserved with vinegar or acetic acid' directly from the HTS heading". Id., seventh page. The ITA read that phrase as having been interpreted by Customs to require a minimum 0.5 percent acetic-acid level. See id., ninth page. As plaintiffs' product, admittedly, does not contain that much, the agency determined it to be within the ambit of its antidumping-duty order. See id., second and fifth pages.
Jurisdiction over this case is pursuant to 28 U.S.C. §§ 1581(c) and 2631(c). The standard of review is whether the determination is unsupported by substantial evidence on the record or otherwise not in accordance with law. See 19 U.S.C. §§ 1516a(a)(2)(B)(vi), 1516a(b)(1)(B)(i). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938). It must also be noted that, on questions of scope, the ITA has "broad authority to interpret its own antidumping duty orders". INA Walzlager Schaeffler KG v. United States, 108 F.3d 301, 307 (Fed.Cir.1997). Such determinations are made pursuant to 19 C.F.R. § 351.225, which states that, in
considering whether a particular product is included within the scope of an order . . ., the Secretary will take into account the following:
(1) The descriptions of the merchandise contained in the petition, the initial investigation, and the determinations of the Secretary (including prior scope determinations) and the Commission.
(2) When the above criteria are not dispositive, the Secretary will further consider:
(i) The physical characteristics of the product;
(ii) The expectations of the ultimate purchasers;
(iii) The ultimate use of the product;
(iv) The channels of trade in which the product is sold; and
(v) The manner in which the product is advertised and displayed.
19 C.F.R. § 351.225(k) (2000).
None of the parties suggests resort to these enumerated criteria.5 Rather, each side argues for a different interpretation of the petition language and the agency determination(s). See, e.g., Plaintiffs' Brief, pp. 12-13; Defendant's Memorandum, p. 31; Response Brief of Defendant-Intervenor, pp. 15-16.
The plaintiffs reiterate that the "petitioners intended the dumping order to cover...
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Tak Fat Trading Co. v. U.S.
...excluded from the antidumping order. Tak Fat then appealed the case to the Court of International Trade. Tak Fat Trading Co. v. United States, 294 F.Supp.2d 1352 (Ct. Int'l Trade 2003). They argued before the court that the plain language of neither the order nor the record supported Commer......