A Japanese company has agreed to pay $45 million for evading anti-dumping regulations on a pigment, after the head of a Fort Mill-based company filed a lawsuit against Toyo Ink.
John Dickson, CEO of Nation Ford Chemical, filed the initial lawsuit in 2009 against its competitor Toyo Ink under the False Claims Act. The law allows citizens to sue on behalf of the U.S.
Dickson was later joined by the Charlotte-based U.S. Attorneys office for the Western District of North Carolina and other federal agencies. They alleged that Toyo Ink knowingly misrepresented the origin of carbazole violet pigment as Japan and Mexico.
The true source of the pigment, however, was India and China, according to the lawsuit. Imports of carbazole violet pigment from those countries are subject to special import taxes, known as anti-dumping and countervailing duties, to protect American producers from goods being sold at less than fair value.
By misrepresenting the country of origin, the complaint said Toyo Ink avoided paying the extra duties. Those duties are 44.8 percent on imports from India and more than 241 percent on imports from China, according to the lawsuit.
It was necessary for me to expend literally thousands of hours obtaining Chinese export data and other information, and in many instances getting it translated to conclusively piece together the evidence that the source was indeed Chinese, said Dickson, in a statement.
Toyo Ink, along with its affiliates in New Jersey and Illinois, did not admit liability regarding the claims.
Fair and lawful trade requires importers to truthfully identify their products and pay the appropriate duties, said U.S. Attorney Anne Tompkins, in a statement. Our office will vigorously investigate and prosecute importers who make false representations and claims designed to avoid the payment of lawful import duties.
Privately held Nation Ford Chemical was founded in 1977, and manufactures a variety of chemicals. As the original filer, Dickson is entitled to receive just under $7.9 million from the $45 million settlement. He said the money will be used for the benefit of workers at NFC in Fort Mill, South Carolina, and others harmed by the imports of these Chinese products.
Dickson and Nation Ford Chemical were represented by the Charlotte law firm James McElroy & Diehl.