An importer of furniture sold for student housing has agreed to pay $1.525 million to settle a civil False Claims Act suit alleging it conspired to make false statements to avoid paying duties on wooden furniture imported from China, the U.S. Department of Justice announced Friday.

The DOJ said Daniel Scott Goldman and two entities he controlled through a series of limited liability companies and trusts, Ecologic Industries LLC and OMNI SCM LLC, agreed to settle the FCA suit originally filed by a whistleblower. Under the agreement, Goldman will pay a total of $850,000 and the two companies will together pay $675,000 in payments spread over five years.

Goldman and his companies are accused of misclassifying furniture destined for dorm bedrooms as office and other types of furniture in customs documentation to avoid paying anti-dumping duties on wooden bedroom furniture manufactured in China.

"Customs duties are meant to protect domestic companies and American workers from unfair competition from abroad," U.S. Attorney Richard L. Durbin Jr. said. "Those who import goods into the United States must comply with the law."

Counsel for Ecologic did not immediately respond to a request for comment Friday.

The government did not intervene against a handful of other defendants, including several entities and individuals, that were named in the initial complaint, according to the settlement notice. Claims against the other defendants were dismissed with prejudice, according to an order signed by U.S. District Judge Sam Sparks on Sept. 23.


Federal prosecutors alleged that between February 2012 and December 2014, Ecologic, OMNI and Goldman knowingly misclassified or conspired with others to misclassify wooden bedroom furniture on documents presented to U.S. Customs and Border Protection to avoid paying anti-dumping duties on those imports. Ecologic Industries sells furniture for student housing, while OMNI SCM provided procurement and supply chain services and served as importer of record for Ecologic, according to the DOJ.

The U.S. Department of Commerce assesses anti-dumping duties to protect U.S. businesses by offsetting unfair foreign pricing and foreign government subsidies.

Court records show whistleblower Matthew Bissanti filed the case in 2014 under seal. Bissanti is a former president and director of OMNI, and alleged that on conference call discussions about the misclassification of the bedroom furniture, he cautioned the practice would likely evade detection by customs officials but would be "severely into the very dark gray or even outright deceitful."

Parts of the case detailing the government investigation remain under seal, but the complaint and notice of settlement were made public after Ecologic agreed to the deal. Bissanti will receive $228,750 as his share of the settlement, the DOJ said.

The government was represented by Susan Strawn of the U.S. Department of Justice.

Bissanti was represented by Scott Johnston of Givens & Johnston PLLC.

The Ecologic parties were represented by John Gibbons Esq.

The case is U.S. ex rel. Bissanti v. Goldman et al., case number 1:14-CV-00497, in the U.S. District Court for the Western District of Texas.

(Source: law360, by Jess Davis)