CIT Orders Importer to Pay Misclassification Penalty After Failure to Respond to Lawsuit

The Court of International Trade on March 25 ordered a dairy importer to pay over $30,000 in unpaid duties and penalties for misclassifying and undervaluing his entries and falsely declaring them eligible for duty preferences under the Caribbean Basin Economic Recovery Act. According to the court order (here), the government alleges Juan Chavez and his company incorrectly classified entries of “soft dairy express” as dairy butter substitutes under subheading 0405.20.4000 and non-cow’s milk cheese under subheading 0406.90.9900. He also undervalued some entries so they were below the $2,500 informal entry limit and did not require bonds, it said. Though Chavez initially defended himself against the charges, he has since failed to respond to inquiries from the court, said CIT. The government still seeks an additional $137,431.55 in unpaid duties and penalties from Chavez’ company.