H.J. Heinz Co. of Canada Ltd. v. Gerber Products Co.

H.J. Heinz Co. of Canada Ltd. v. Gerber Products Co. Court (s) Database Federal Court of Appeal Decisions Date 2004-05-26 Neutral citation 2004 FCA 208 File numbers A-280-03 Decision Content Date: 20040526 Docket: A-280-03 Citation: 2004 FCA 208 CORAM: LINDEN J.A. SEXTON J.A. EVANS J.A. BETWEEN: H.J. HEINZ COMPANY OF CANADA LTD. Applicant and GERBER PRODUCTS COMPANY/NOVARTIS CONSUMER HEALTH CANADA INC., THE COMMISSIONER OF COMPETITION and INITIATIVE FOODS Respondents APPLICATION UNDER SECTION 28 OF THE FEDERAL COURT ACT AND SECTIONS 77.012 AND 96.1 OF THE SPECIAL IMPORT MEASURES ACT Heard at Ottawa, Ontario, on May 26, 2004. Judgment delivered at Ottawa, Ontario, on May 26, 2004. REASONS FOR JUDGMENT OF THE COURT BY: SEXTON J.A. Date: 20040526 Docket: A-280-03 Citation: 2004 FCA 208 CORAM: LINDEN J.A. SEXTON J.A. EVANS J.A. BETWEEN: H.J. HEINZ COMPANY OF CANADA LTD. Applicant and GERBER PRODUCTS COMPANY/NOVARTIS CONSUMER HEALTH CANADA INC., THE COMMISSIONER OF COMPETITION and INITIATIVE FOODS Respondents REASONS FOR JUDGMENT (Delivered from the Bench at Ottawa, Ontario, May 26, 2004) SEXTON J.A. [1] The applicant brings an application for judicial review of an expiry review decision of the Canadian International Trade Tribunal ("Tribunal") dated April 28, 2003. In its earlier decision dated April 29, 1998 the Tribunal found that dumping by the respondent Gerber of its baby food products had caused material injury to the applicant (Heinz) in the form of price erosion, price suppression and lost market share. [2] In its review decision, five years later, the Tribunal found that although the Commissioner of Customs and Revenue Agency (the "Commissioner") had determined that upon the expiry of the earlier order, there would likely be a resumption of dumping by Gerber, such renewed dumping was not likely to cause material injury to Heinz, who by that time had acquired 100% of the market for certain prepared baby food. [3] The main arguments by the applicant were that the Tribunal erred by: a) ignoring or overruling the finding of the likely resumption of dumping by the Commissioner, by reason of its consideration of issues such as the volume and timing of dumping; b) limiting its inquiry to a period of 24 months from the expiry of the earlier finding; c) failing to apply a "but for" test to determine whether dumping was likely to cause injury. The so-called "but for" test would basically involve answering the question as to whether Heinz would be materially better off but for the dumping. [4] We cannot agree with the applicant's submissions. The Tribunal did not overrule the Commissioner on the issue of dumping. Rather the Tribunal accepted the finding of the Commissioner that the subject goods would be exported into Canada at dumped prices. However the Tribunal was obliged to make a finding of the likelihood of material injury and in do so doing it found it necessary to consider the issues of the likely volume and timing of dumping. We agree that these were relevant issues in making the determination of the likelihood of material injury. [5] As to the adoption of a 24 month period following expiry as being the appropriate period for analysis, the Tribunal did not adopt an arbitrary figure as suggested by the applicant. Nor was it a figure which the Tribunal has adopted as a matter of routine in all its decisions. Rather it was a period selected by the Tribunal after considering the particular circumstances of this case. The Tribunal said: In making its assessment of the likelihood of injury, consistent with previous cases, the Tribunal is of the view that the focus must be on circumstances that can reasonably be expected to exist in the near and medium terms as opposed to more remote circumstances. The period chosen by the Tribunal normally takes account of the particular circumstances and facts of the case. In this case, where there is little likelihood of dumped imports immediately after the expiry of the finding, the Tribunal considers that it is appropriate to examine a period of up to 24 months from the expiration of the finding. [6] With respect to the so-called "but for" test, there is no such test mandated by the Special Import Measures Act R.S. 1985, c. S-15 or the Regulations thereunder. Indeed the Special Import Measures Regulations (SOR/84-927) list a number of factors to be considered by the Tribunal when it determines whether there is a likelihood of material injury. The Tribunal considered these factors and we are of the view it would be an error to impose any single test for determining injury to the domestic industry, such as the but-for test, upon the Tribunal. [7] The decision of the Tribunal is essentially one based on findings of fact and we are unable to conclude that its conclusions are patently unreasonable. [8] The application will therefore be dismissed with costs to the respondents Commissioner of Competition, Gerber Products Company and Novartis Consumer Health Canada Inc. "J. EDGAR SEXTON" J.A. FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-280-03 STYLE OF CAUSE: H.J. Heinz Company of Canada Ltd. v. Gerber Products Company et al. PLACE OF HEARING: Ottawa, Ontario DATE OF HEARING: May 26, 2004 REASONS FOR JUDGMENT OF THE COURT: Linden, Sexton and Evans JJ.A. RENDERED FROM THE BENCH BY: Sexton J.A. APPEARANCES: Mr. Randall Hofley Mr. Kim Alexander-Cook FOR THE APPLICANT Mr. Simon Potter Ms. Brenda Swick FOR THE RESPONDENT, GERBER Ms. Josephine Palumbo FOR THE RESPONDENT,COMMISSIONER OF COMPETITION SOLICITORS OF RECORD: Stikeman Elliott LLP Ottawa, Ontario FOR THE APPLICANT Ogilvy Renault Ottawa, Ontario FOR THE RESPONDENT, GERBER Mr. Morris Rosenberg Deputy Attorney General of Canada Ottawa, Ontario FOR THE RESPONDENT, COMMISSIONER OF COMPETITION