2014

19 USC 1592 (a)(1) prohibits any person from fraudulently or negligently entering, introducing or attempting to enter or introduce merchandise into US commerce by means of (a)any document or electronically transmitted data or information, written or oral statement, or act that is material and false or (b) any material omission.

In the recent case of U.S. Trek Leather, Inc. and Harish Shadadpuri, 724 F.3d 1330 (Fed. Cir. Jul. 30 2013) the court was faced with the question whether or not this applied to a person who was acting in his or her capacity as a corporate officer of the “importer of record”.

In 2011, USCBP filed suit against the importer and its president and sole shareholder seeking $45,245.39 in unpaid customs duties and damages of $2,392,307.00 for allegedly fraudulently, knowingly, and intentionally understating dutiable value of imported men’s suits by omitting value of fabric assists.  CBP alternatively sought civil penalty in the amount of $534,430.32 for gross negligence.

On September 16, 2014, an appeals court issued a decision wherein they distinguished from persons who “enter” goods (e.g. the importer of record”) and persons who “introduce goods into U.S. commerce creating a board definition for those who “introduce” goods and thereby creating a new category of persons subject to penalties for violation of 19 USC 1592(a).  In its En Banc decision the Court ruled that there was no basis for limiting the meaning to the term when it clearly was largely encompassing and obviously covered human beings.

It was found that Shadadpuri was grossly negligent […]