Taiwanese LED Manufacturer to Pay $5.15 Million to Settle Import Duty Evasion Claims

A major Taiwanese LED manufacturer and its U.S. subsidiary have agreed to pay $5.15 million to the United States to resolve allegations of violating the False Claims Act and other trade regulations by evading customs duties on imported goods. According to the U.S. Attorney’s Office for the District of Maryland, Everlight Electronics and its Texas-based subsidiary, Everlight Americas, are accused of knowingly misrepresenting the country of origin for light-emitting diodes manufactured in the People’s Republic of China. This alleged misrepresentation allowed the companies to avoid paying applicable Section 301 tariffs, which are trade sanctions imposed on certain goods from China.

The settlement aims to resolve claims that, between July 2018 and January 2022, Everlight intentionally misidentified the origin of Chinese-manufactured LEDs as Taiwan. The company is alleged to have transshipped these products through Taiwan before exporting them to the U.S. in an effort to circumvent higher duty rates. Further allegations suggest that from January 2022 through November 2025, Everlight continued to import LEDs from Taiwan, some of which contained components manufactured in China, without adequately distinguishing between the two origins during the manufacturing process. U.S. Customs and Border Protection (CBP) is responsible for collecting duties owed on imported goods, including Section 301 tariffs designed to protect U.S. industries and address unfair trade practices.

The resolution of these allegations includes claims brought forth under the whistleblower provisions of the False Claims Act, initiated by Tao Wang, a former Everlight employee. Under these provisions, private citizens can file lawsuits on behalf of the U.S. government and may receive a portion of any recovered funds. In this case, the whistleblower is set to receive $876,146 of the settlement amount. The qui tam action related to this case is United States ex rel. Wang v. Everlight Electronics Co., Ltd., et al., filed in the District of Maryland. This settlement underscores the government’s commitment to combating trade fraud, which can undermine revenue collection, harm domestic businesses, and impact consumer confidence.

In August 2025, the Department of Justice established a cross-agency Trade Fraud Task Force to bolster efforts against trade fraud. This task force integrates expertise from the Civil and Criminal Divisions of the Department of Justice, along with the Department of Homeland Security, to aggressively pursue parties involved in tariff evasion and the import of prohibited goods. The Department of Justice encourages individuals with credible information about fraud to utilize the whistleblower provisions of the False Claims Act. U.S. Attorney Kelly O. Hayes commended CBP for its investigative work and support, noting the crucial role of the Electronic Center of Excellence and Expertise and the Office of Assistant Chief Counsel in Baltimore. The claims resolved by this settlement are considered allegations, and no determination of liability has been made.

Article by Mel Anara, based upon information from U.S. Attorney’s Office, District of Maryland

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