Justice Department Files Suit for Unpaid Duties and Penalties for Alleged Misclassification and Failure to Pay Duties on Imported Chinese Solar Panels

The Justice Department has filed a civil lawsuit against Paul Bakhoum, who was the Vice President for Operations for Ecosolargy Inc., a California Corporation that imported Chinese-manufactured solar panels into the United States. The lawsuit alleges that Mr. Bakhoum made false statements to customs officials and, as a result, avoided paying harmonized tariff schedule (HTS), antidumping and countervailing duties owed on the imported solar panels.

At the time merchandise is entered into the United States, the importer is responsible for providing all information necessary to enable Customs and Border Protection (CBP) to assess the applicable duties owed on the goods, including any HTS, antidumping and countervailing duties applicable to the merchandise. The HTS sets duties based on the category of the product (for example, solar cells), while antidumping and countervailing duties are trade remedies that help protect domestic industries from unfair trade practices by foreign businesses and countries, such as government subsidies or below market sales.

The United States’ complaint contends that Bakhoum caused Ecosolargy to falsely classify solar panels imported from China as LED lights. In particular, the United States alleges that Bakhoum negligently misrepresented to CBP the imported solar panels’ HTS code and value and failed to identify both the proper antidumping duty and countervailing duty rates applicable to the panels.  

“The Justice Department is committed to pursuing those who evade customs duties or otherwise engage in unfair trade practices that harm U.S. manufacturers,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to employ all of our available tools to ensure that U.S. manufacturers are competing on a level playing field.”

“CBP takes its trade mission of protecting the U.S. economy very seriously as we strive to maintain fair trade and preserve American jobs from predatory practices,” said Executive Director Susan Thomas of CBP’s Cargo and Conveyance Security, Office of Field Operations. “These civil penalties should serve as a warning to those who attempt to do harm to our economy and American businesses.”

The complaint seeks the recovery of almost $300,000 in import duties and almost $800,000 in civil penalties.

CBP’s Electronics Center of Excellence and Expertise investigated the case. CBP and Homeland Security Investigations are the agencies responsible for enforcing U.S. laws related to the importation of merchandise into the United States, including the collection of duties and assessment of penalties.

Trial Counsel Daniel Hoffman of the Civil Division’s Commercial Litigation Branch, National Courts Section, handled the case.

The case, which is filed in the Court of International Trade, is captioned United States v. Paul Bakhoum No. 24-00188.

To combat trade fraud, including avoidance of import duties, the Justice Department created a Trade Fraud Task Force. The Task Force partners with CBP and other law enforcement agencies to ensure compliance with United States trade laws.

The claims in the complaint are allegations only. There has been no determination of liability.