Petitioner Defends Challenge to Pick of German Comparison Market in AD Case on Mushrooms
Petitioner Giorgio Foods on Feb. 12 defended its claim at the U.S. Court of Appeals for the Federal Circuit that the Commerce Department unlawfully picked Germany as the comparison market for the antidumping duty investigation of preserved mushrooms from the Netherlands. In a reply brief, Giorgio argued, among other things, that the U.S. and respondent Prochamp misconstrued the petitioner's "key point" concerning the AD statute's hierarchical approach to identifying foreign like products, which contributes to the selection of comparison markets (Giorgio Foods v. United States, Fed. Cir. # 25-2090).
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In its opening brief, Giorgio argued that the AD statute establishes a "three-party hierarchy for determining the 'foreign like product.'" Yet the government's claim that one category, "listed equally with identical merchandise is merchandise that is ‘produced in the same country and by the same person and of the same general class or kind as subject merchandise,’ is confusing, contrary to the statute’s plain language, and the Courts’ consistent interpretation of 19 U.S.C. § 1677(16)," the petitioner argued.
The government's "construction of the statute" is "wrong and is one basis for this Court to remand Commerce's determination," the brief said.
Giorgio added that the record revealed that Prochamp sold mushrooms to Germany in a "unique manner that distinguished those sales from Prochamp's U.S. sales and other potential comparison markets." While Commerce acknowledged it erred in finding Prochamp's German and U.S. sales channels and customer types were similar, it ultimately said these facts weren't determinative. The Court of International Trade found this error to be harmful.
"Contrary to the CIT's harmless error determination, however, Commerce's error was multiple in that it also failed to consider evidence establishing that Prochamp's French and U.S. sales channels and customer types were more similar than its German sales channels and customer types, providing additional evidence that France (not Germany) was the appropriate comparison market," Giorgio argued.
While the U.S. said the initial findings on sales channels and customer types were only used to "corroborate" Commerce's ultimate finding, the government "takes its argument one step further" by arguing Commerce didn't need to "reanalyze whether the further information about United States slaves supported an alternative finding," since the regulatory criteria were still met. Giorgio said this claim is "internally inconsistent with its own brief and contrary to agency practice."
In the investigation, Commerce used Prochamp's German market sales to determine normal value, since the German market was the company's largest third-country market. CIT initially remanded the selection on the grounds that the evidence didn't support the fact that Prochamp's German sales were actually sold in Germany (see 2407260023).
The trade court noted that the respondent only made sales to a multinational retailer and they were actually exported to a warehouse outside of Germany, where they just as easily could have been meant for another German-speaking market. On remand, Commerce reopened the record to quantify what portion of Prochamp's German market sales actually wound up in Germany (see 2411180045).
Before the CAFC, the U.S. emphasized in its response that the French data underwent no similar scrutiny and argued that the German data is supported on the record. In response, Giorgio argued that the record clearly shows a greater percent of Prochamp's French sales "could have been matched identically with Prochamp's U.S. sales."