A Texas furniture importer and two company officers have agreed to pay the U.S. government $275,000 to resolve False Claims Act allegations that they deliberately misclassified furniture imports to avoid paying U.S. customs duties.
According to the U.S. Department of Justice, Import Merchandising Concepts L.P. of Addington, Texas, and company officials Glen Michaels and Alan Lewis, imported wooden bedroom furniture from the People’s Republic of China. The furniture, which is sold for use in university dormitories and other student housing, is subject to antidumping duties.
The U.S. Department of Commerce attaches antidumping duties to certain imports, and the U.S. Customs and Border Protection collects the duties on entry to the U.S. The duties are intended to protect domestic businesses against foreign companies “dumping” products into the U.S. market at prices below cost, effectively leveling the playing field between products made in the U.S. and other countries.
The Justice Department alleges that from 2009 to 2014, Import Merchandising misclassified bedroom furniture made in China as non-bedroom furniture on its official import documents. Antidumping duties in this timeframe were assessed at 216 percent on bedroom furniture, whereas non-bedroom furniture was not subject to any antidumping duties.
“Those who import and sell foreign-made goods in the United States must comply with the law, including laws intended to protect domestic companies and American workers from unfair foreign competition,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “This settlement reflects the Department of Justice’s commitment to pursue those who seek to evade import duties owed on goods manufactured abroad thereby gaining an unfair advantage in U.S. markets.”
The U.S. last year settled a similar but much larger False Claims Act case brought by a whistleblower against a Texas furniture importer. In that case, University Loft Company alleged that University Furnishings conspired with others to avoid paying antidumping duties on wooden bedroom furniture it brought into the U.S. from the People’s Republic of China. The defendants paid the U.S. $15 million to resolve the allegations.
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Are you aware of fraud being committed against the federal government, or a state government? If so, the FCA can protect and reward you for doing the right thing by reporting the fraud. If you have any questions about whether you qualify as a whistleblower, please contact an attorney at Beasley Allen for a free and confidential evaluation of your claim. There is a contact form on this website, or you may email one of the lawyers on our whistleblower litigation team: Archie Grubb, Larry Golston, Lance Gould or Andrew Brashier.
Source: U.S. Department of Justice