Opinion ID: 1141147
Heading Depth: 4
Heading Rank: 3

Heading: Evidence of Some Competition

Text: Having determined the scope of the refund remedy in general terms, we now turn to the question whether, for purposes of summary judgment, there is a genuine issue of material fact precluding HFM's entitlement to that remedy, as a matter of law. That is, has HFM demonstrated that there is no genuine issue of material fact that its imported processed foods competed with exempt local fresh foods for AHC's business? HFM adduced an affidavit of AHC's Senior Purchasing Agent, Judy Furukawa, stating in relevant part: 7. American Hawaii Cruises will purchase local food products, if the food products can be purchased at a price better than or equal to out-of-state food products, and if the local food products can be supplied in the required amounts and needed specifications. 8. If the prices of local food products make it economically advantageous to purchase local food products, rather than out-of-state food products, then American Hawaii Cruises will purchase the local food products. These include, but are not limited to local food products such as chilled beef, chicken or fruits rather than out-of-state food products such as cut beef and chicken that is pre-packaged and frozen or pre-cut fruits that are canned or jarred. 9. American Hawaii Cruises understands that many of the food products purchased can be considered processed in one form or another (i.e. cut, pre-packaged frozen steaks and chicken). If fresh local products can be purchased at similar prices and quantities they would certainly compete with those food products currently being purchased. The Director attempted to rebut this affidavit by submitting an affidavit of one of his auditors. That affidavit recounted statements purportedly made by Furukawa that might be construed as casting some doubt on her affidavit. For instance, it stated that Furukawa told the auditor that [p]repackaged grapefruit sections would not be substituted for fresh grapefruit on the AHC menus. The affidavit also attributed similar statements to a senior vice president of AHC ( e.g., [f]resh items are not substituted with canned items.). These statements are inadmissible hearsay and as such are of no value on summary judgment. HRCP 56(e) (1990) (opposing or supporting affidavits must set forth facts as would be admissible in evidence). Furukawa's affidavit established that HFM's products, in general, were in some competition with fresh local products. It was enough therefore to preclude the Director from obtaining summary judgment. On the other hand, the affidavit does not state that all of the processed foods that HFM sold to AHC were in competition with exempt products for the entire period in question. Because HFM is entitled only to a refund of the GET it paid on sales of the particular foods that actually competed with fresh local foods for AHC's business, there is a genuine issue of material fact as to the amount of the refund owed. Thus, HFM was not entitled to summary judgment either. On remand HFM bears the burden of establishing specifically which of its products competed with exempt products for AHC's business.