Antidumping Duty Evasion Lawsuit Unsealed After DOJ Declines to Get Involved
A federal judge unsealed documents related to antidumping duty evasion allegations brought by a third party after the Department of Justice declined to get involved, recent court filings show. The lawsuit, brought by Customs Fraud Investigations (CFI), claimed that Mueller Industries and a subsidiary schemed to "fraudulently import its standard pipe as line pipe" to avoid antidumping duties on the product. The complaint, filed in 2014, was unsealed on Sept. 15 in U.S. District Court for the North District of Illinois Eastern Division.
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The lawsuit is the result of CFI's "direct and independent knowledge of the information on which the allegations contained herein are based," it said. CFI also provided the information to the government before filing the compliant, it said. CFI filed the lawsuit under the qui tam provisions of the False Claims Act, which allows for whistleblowers to file civil suits on behalf of the government and receive a portion of any recovered funds. The U.S. attorney for the Northern District of Illinois filed a "notice of election to decline intervention" on Sept. 15.
While CFI is allowed to continue to pursue the lawsuit despite the DOJ's decision not to intervene, it hasn't informed the government of whether it plans to do so, the U.S. attorney's filing said. "Intentional evasion of anti-dumping duties is a serious problem, and whistleblowers can play a big part in [combating] that problem," said CFI's lawyer, Jonathan Tycko of Tycko & Zavareei. "In the Mueller case specifically, we are still considering next steps, and have not made any final decision yet.” CFI previously filed another qui tam suit that was thrown out and is now under appeal (see 1504290070). Mueller didn't comment.
Mueller and its subsidiary Southland Pipe Nipples violated the False Claims Act by submitting false information to CBP meant to avoid antidumping duties, CFI said in the compliant. The "scheme" begin in or around 2009 as a result of Commerce Department decisions that led to increased antidumping duty rates on standard pipes, CFI said. While Mueller claimed to Commerce that it imported no standard pipes after Oct. 31, 2009, "Mueller's certifications were, in fact, false, as Mueller continues to import standard pipe," CFI said in the 2014 complaint. Despite "physical characteristics" that "plainly show" the pipes are considered standard pipe, the company instead "falsely claims" to import line pipe, which falls within a Commerce exemption to the antidumping duty order, CFI said.
Mueller is also accused of "knowingly importing pipe from Mexico and other countries without proper country-of-origin markings," CFI said. Improper markings would automatically require payment of "certain customs duties, namely, what are referred to as 'marking duties' in the amount of 10% of the value of the unmarked imports." Mueller "further knowingly falsified customs documents required to be filed with the Government and otherwise concealed the company's obligation to pay those marking duties by making false statements on its entry documents," CFI said.
Email ITTNews@warren-news.com for the CFI compliant and the DOJ's filing.