Taiwan Manufacturer Agrees to $51.5 Million False Claims Act Settlement

Aug. 7, 2026
By: Marvin E. McPherson

The U.S. Department of Justice (DOJ) announced a settlement agreement with a Taiwan-led manufacturer for $51.5 million to resolve allegations under the False Claims Act (FCA).

According to announcement, the settlement resolves allegations that Everlight Electronics, a publicly traded Taiwanese company, and Everlight Americas, its Texas-based subsidiary knowingly misrepresented the country of origin on Chinese-manufactured commodities.  DOJ alleges that Everlight knew these products were manufactured in China, and then transshipped to Taiwan, before importing into the U.S. This structure was in attempt avoid paying applicable Section 301 duties on Chinese-origin commodities.

The settlement is another reminder that DOJ and U.S. Customs and Border Protection (CBP) continue to aggressively pursue customs duty evasion through the False Claims Act. Importers should expect heightened scrutiny of representations that affect the amount of duties owed, including country-of-origin declarations, tariff classification, customs valuation, and other information material to duty assessment.

Companies can mitigate CBP enforcement penalties first (and foremost) by having a clear written policy that the company will comply with U.S. Customs laws and actually working to meet that policy statement. This can be done by performing regular reviews of customs entries, supporting documentation, supplier certifications, country-of-origin determinations, tariff classifications, and valuation methodologies and other compliance activities. Importers should proactively evaluate their customs compliance programs and conduct periodic audits to help ensure the accuracy of duty-related representations and identify potential issues before they become enforcement actions.

If you have any questions regarding country-of-origin determinations, tariff classifications, and valuation, please contact any attorney at Barnes Richardson and Colburn.