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CERTAIN PASTA from ) 731-TA-734-735 ITALY and TURKEY ) (Third Review)

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CERTAIN PASTA from ) 731-TA-734-735 ITALY and TURKEY ) (Third Review) UNITED STATES INTERNATIONAL TRADE COMMISSION In the Matter of: ) Investigation Nos.: ) 701-TA-365-366 and CERTAIN PASTA FROM ) 731-TA-734-735 ITALY AND TURKEY ) (Third Review) Pages: 1 through 299 Place: Washington, D.C. Date: July 11, 2013 HERITAGE REPORTING CORPORATION Official Reporters 1220 L Street, N.W., Suite 600 Washington, D.C. 20005 (202) 628-4888 [email protected] 1 THE UNITED STATES INTERNATIONAL TRADE COMMISSION In the Matter of: ) Investigation Nos.: ) 701-TA-365-366 and CERTAIN PASTA FROM ) 731-TA-734-735 ITALY AND TURKEY ) (Third Review) Thursday, July 11, 2013 Main Hearing Room U.S. International Trade Commission 500 E Street, S.W. Washington, D.C. The hearing commenced, pursuant to notice, at 9:32 a.m., before the Commissioners of the United States International Trade Commission, the Honorable IRVING A. WILLIAMSON, Chairman, presiding. APPEARANCES: On behalf of the International Trade Commission: Commissioners: IRVING A. WILLIAMSON, CHAIRMAN DANIEL R. PEARSON, COMMISSIONER SHARA L. ARANOFF, COMMISSIONER DEAN A. PINKERT, COMMISSIONER MEREDITH M. BROADBENT, COMMISSIONER Staff: WILLIAM R. BISHOP, SUPERVISORY HEARINGS AND INFORMATION OFFICER SHARON BELLAMY, HEARINGS AND MEETINGS ASSISTANT KEYSHA MARTINEZ, INVESTIGATOR JOHN GIAMALVA, INTERNATIONAL TRADE ANALYST JOHN BENEDETTO, ECONOMIST DAVID BOYLAND, ACCOUNTANT/AUDITOR JOHN HENDERSON, ATTORNEY ELIZABETH HAINES, SUPERVISORY INVESTIGATOR Heritage Reporting Corporation (202) 628-4888 2 APPEARANCES: (Cont'd.) In Support of the Continuation of the Antidumping and Countervailing Duty Orders: On behalf of the Domestic Industry: ROBERT VERMYLEN, Vice President, A. Zerega's Sons, Inc. WALT GEORGE, Consultant, American Italian Pasta Company SCOTT MEKUS, Vice President of Finance, American Italian Pasta Company BRIAN FOX, Vice President of Category Management, American Italian Pasta Company JACK HASPER, Vice President of Sales and Marketing, Dakota Growers Pasta Company SHANE FAUCETT, Senior Vice President of Sales and Customer Development, New World Pasta Company GREGORY S. RICHARDSON, Senior Vice President and Chief Financial Officer, New World Pasta Company NEIL PETRUCELLI, Senior Director of Sales, Eastern U.S., New World Pasta Company JEFF BRYANT, Senior Director Customer Marketing, New World Pasta Company MICHAEL T. KERWIN, Director, Georgetown Economic Services GINA E. BECK, Economist, Georgetown Economic Services PAUL C. ROSENTHAL, Esquire KATHLEEN W. CANNON, Esquire DAVID C. SMITH, Esquire GRACE W. KIM, Esquire Kelley Drye & Warren LLP Washington, D.C. Heritage Reporting Corporation (202) 628-4888 3 APPEARANCES: (Cont'd.) In Opposition to the Continuation of the Antidumping and Countervailing Duty Orders: On behalf of Italian Respondents: RICCARDO FELICETTI, President of Pastificio Felicetti S.r.l., President of AIDEPI Pasta Manufacturers and Vice President of AIDEPI ANTHONY DIPIETRO, Vice President, George DeLallo Co. Inc. ANTONIO SCOCCA, International Sales Manager, Rummo S.p.A. DR. ENRICA MASSARELLI, Administrative Officer, Pastificio Garofalo S.p.A. DUSTIN AGLIETTI, National Accounts Manager, Rema Foods, Inc. MELISSA TENDICK, Marketing Associate Director, Pasta Americas, Barilla America, Inc. RICHARD P. FERRIN, Esquire WILLIAM SILVERMAN, Esquire DOUGLAS J. HEFFNER, Esquire Drinker Biddle & Reath LLP Washington, D.C. On behalf of Turkish Producers and Exporters: ABDÜLKADIR KÜLAHÇ9O–LU, General Manager, Durum Arbella, Turkish Pasta Producers Association MEHMET KARAKUS, General Manager, Selva Gida Sanayii A.Ô., Turkish Pasta Producers Association NIHAT UYSALLI, General Coordinator, Nuh'un Ankara Makarnas9 Sanayi ve Ticaret A.Ô., Turkish Pasta Producers Association BULENT HACIOGLU, Economic Consultant, Trade Resources Company MATTHEW M. NOLAN, Esquire DIANA DIMITRIUC-QUAIA, Esquire Arent Fox LLP Washington, D.C. Heritage Reporting Corporation (202) 628-4888 4 I N D E X PAGE OPENING STATEMENT OF PAUL C. ROSENTHAL, ESQUIRE, 8 KELLEY DRYE & WARREN LLP OPENING STATEMENT OF WILLIAM SILVERMAN, ESQUIRE, 12 DRINKER BIDDLE & REATH LLP TESTIMONY OF PAUL C. ROSENTHAL, ESQUIRE, 16 KELLEY DRYE & WARREN LLP TESTIMONY OF ROBERT VERMYLEN, VICE PRESIDENT, 16 A. ZEREGA'S SONS, INC. TESTIMONY OF JACK HASPER, VICE PRESIDENT OF SALES 22 AND MARKETING, DAKOTA GROWERS PASTA COMPANY TESTIMONY OF SHANE FAUCETT, SENIOR VICE PRESIDENT 28 OF SALES AND CUSTOMER DEVELOPMENT, NEW WORLD PASTA COMPANY TESTIMONY OF WALT GEORGE, CONSULTANT, AMERICAN 33 ITALIAN PASTA COMPANY TESTIMONY OF KATHLEEN W. CANNON, ESQUIRE, 39 KELLEY DRYE & WARREN LLP TESTIMONY OF GREGORY S. RICHARDSON, SENIOR VICE 60 PRESIDENT AND CHIEF FINANCIAL OFFICER, NEW WORLD PASTA COMPANY TESTIMONY OF GINA E. BECK, ECONOMIST, GEORGETOWN 71 ECONOMIC SERVICES TESTIMONY OF RICCARDO FELICETTI, PRESIDENT OF 159 PASTIFICIO FELICETTI S.R.L., PRESIDENT OF AIDEPI PASTA MANUFACTURERS AND VICE PRESIDENT OF AIDEPI TESTIMONY OF DR. ENRICA MASSARELLI, ADMINISTRATIVE 162 OFFICER, PASTIFICIO GAROFALO S.P.A. TESTIMONY OF ANTONIO SCOCCA, INTERNATIONAL SALES 166 MANAGER, RUMMO S.P.A. Heritage Reporting Corporation (202) 628-4888 5 I N D E X PAGE TESTIMONY OF DUSTIN AGLIETTI, NATIONAL ACCOUNTS 173 MANAGER, REMA FOODS, INC. TESTIMONY OF MELISSA TENDICK, MARKETING ASSOCIATE 177 DIRECTOR, PASTA AMERICAS, BARILLA AMERICA, INC. TESTIMONY OF MATTHEW M. NOLAN, ESQUIRE, 189 ARENT FOX LLP CLOSING STATEMENT OF PAUL C. ROSENTHAL, ESQUIRE, 285 KELLEY DRYE & WARREN LLP CLOSING STATEMENT OF WILLIAM SILVERMAN, ESQUIRE, 294 DRINKER BIDDLE & REATH LLP CLOSING STATEMENT OF MATTHEW NOLAN, ESQUIRE, 296 ARENT FOX LLP Heritage Reporting Corporation (202) 628-4888 6 1 P R O C E E D I N G S 2 (9:32 a.m.) 3 CHAIRMAN WILLIAMSON: Good morning. On 4 behalf of the U.S. International Trade Commission I 5 welcome you to this hearing on Investigation Nos. 6 701-TA-365-366 and 731-TA-734-735 (Third Review) 7 involving Certain Pasta From Italy and Turkey. 8 The purpose of these five-year review 9 investigations is to determine whether revocation of 10 the countervailing and antidumping duty orders on 11 certain pasta from Italy and Turkey will be likely to 12 lead to continuation or recurrence of material injury 13 within a reasonable foreseeable time. 14 Schedules setting forth the presentation of 15 this hearing, notices of investigation and transcript 16 order forms are available at the public distribution 17 table. All prepared testimony should be given to the 18 Secretary. Please do not place testimony on the 19 public distribution table. 20 All witnesses must be sworn in by the 21 Secretary before presenting testimony. I understand 22 that parties are aware of the time allocations. Any 23 questions regarding the time allocations should be 24 directed to the Secretary. 25 Speakers are reminded not to refer in their Heritage Reporting Corporation (202) 628-4888 7 1 remarks or answers to questions to business 2 proprietary information. Please speak clearly into 3 the microphone and state your name for the record for 4 the benefit of the court reporter. If you will be 5 submitting documents that contain information you wish 6 classified as business confidential, your requests 7 should comply with Commission Rule 201.6. 8 Before we begin, Commissioner Johanson has 9 asked me to let you know that while he's unable to 10 attend the hearing today, he will have the full 11 transcript of today's proceedings and access to the 12 record and will be reviewing it carefully. And 13 Commissioner Broadbent will be with us shortly. 14 Okay. Mr. Secretary, are there any 15 preliminary matters? 16 MR. BISHOP: Mr. Chairman, I would note that 17 all witnesses for today's hearing have been sworn. 18 (Witnesses sworn.) 19 MR. BISHOP: There are no other preliminary 20 matters. 21 CHAIRMAN WILLIAMSON: Okay. Let's begin. 22 MR. BISHOP: Opening remarks on behalf of 23 those in support of continuation of the orders will be 24 by Paul C. Rosenthal, Kelley Drye & Warren. 25 CHAIRMAN WILLIAMSON: Welcome, Mr. Heritage Reporting Corporation (202) 628-4888 8 1 Rosenthal. You may begin when you're ready. 2 MR. ROSENTHAL: Good morning. Thank you, 3 Mr. Chairman and members of the Commission. I'm Paul 4 Rosenthal of Kelley Drye & Warren representing the 5 domestic pasta industry in this case. 6 The domestic industry will focus its 7 testimony this morning on what has changed and what 8 has not changed, and of course we will focus on where 9 the Commission ought to be focusing, and that is what 10 will happen in the future if the antidumping and 11 countervailing duty orders are revoked. 12 Many of the essential facts that were 13 discussed during the previous review remain the same. 14 One thing that hasn't changed since the last review 15 or since time immemorial is that the recipe for pasta 16 is still semolina and water. I say this seriously to 17 highlight the various claims made by the Respondents 18 that their pasta was so different from U.S. pasta that 19 it did not compete with the U.S. industry. 20 In the original investigation in this 21 product and since, Italian representatives have argued 22 that their product is higher quality than U.S. 23 product. They have claimed variously that because 24 they use different dies, different water or different 25 production techniques that their products didn't Heritage Reporting Corporation (202) 628-4888 9 1 compete with the U.S. product. Or, having failed to 2 differentiate on physical characteristics, that their 3 product still tasted better. 4 The Turkish representatives made the 5 opposite claim. Their semolina and water combination 6 was inferior to the U.S. and Italian pasta and so did 7 not compete with the others. 8 As you know, objective taste comparisons, 9 market studies and other evidence submitted to the 10 Commission in the original investigation and 11 subsequently show that the American products compare 12 well with the Italian and Turkish competitors. That 13 is no surprise because the industries in these three 14 countries use equipment from the same manufacturers, 15 source wheat from the same sources and same areas and 16 use the same production techniques.
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