US Asks Trade Court to Enter $5.8M Default Judgment Against Importer, Owner for Skirting Duties

The U.S. asked the Court of International Trade on June 12 to order importer Rayson Global and its owner Doris Cheng to pay over $5.8 million for skirting antidumping and Section 301 duties on uncovered mattress innersprings from China as part of a default judgment against the two defendants (United States v. Rayson Global, CIT # 23-00201).

The trade court entered Rayson and Cheng into default last month for failure to file an answer to the government's complaint (see 2405280055). Judge Timothy Stanceu rejected the pair's third motion for an extension of time to file an answer since he granted two previous extensions, all three of which were filed out-of-time, due to counsel's "serious health issues." Since no health issues existed for the third extension bid, the court denied the motion as untimely.

Following the entry into default, the government laid out the terms of the default judgment it wants the trade court to impose. The U.S. said Rayson and Cheng are "liable for negligence" for making material false statements to CBP by claiming its goods came from Thailand and not China. The government said the evidence against the pair is "relevant and compelling" and that Rayson and Cheng "failed to provide any evidence establishing that they attempted to determine the true country of origin of the imported innersprings."

The U.S. said the court should award the government the "total loss of revenue," which amounted to $2,431,225.93, and the "full penalty," which the government claimed to be $3,381,607.03. The government said equitable concerns shouldn't diminish the size of the penalty, since Cheng and her other companies "have been the subject of CBP scrutiny since at least 2004." Other issues involving Cheng centered on "rate advances for misclassification, quota evasion, uninvoiced goods, and undervaluation," the motion said.