US Seeks Nearly $7.7M in Unpaid Antidumping Duties From Furniture Importers, Owner
The U.S. opened a civil suit against importers Aspects Furniture Manufacturing and Aspects Furniture International seeking nearly $7.7 million in unpaid antidumping duties on 99 entries of wooden bedroom furniture from China. The complaint also named Hospitality Engineering Services and the chief executive of all three companies, Amy Sivixay, as defendants, claiming that Hospitality and Sivixay are liable for the unpaid duties, since they controlled the actions of the two importers (United States v. Aspects Furniture Manufacturing, CIT # 25-00089).
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The complaint laid out three groups of entries, the first of which includes 45 entries of wooden bedroom furniture imported by Aspects Furniture Manufacturing in 2011. The entries were made by exporter Shanghai Maoji Import and Export Corp., which was subject to the China-wide AD rate of 216.01%.
The second group of entries was brought in by Aspects Furniture International in 2014 and includes 33 entries of wooden bedroom furniture. The complaint alleges that Sivixay began diverting assets away from Aspects Furniture Manufacturing to the newly created Aspects Furniture International after the lofty duty rate was imposed on the subject furniture.
Lastly, the third group of entries includes 21 entries of the furniture imported in 2016-17 also by Aspects Furniture Manufacturing.
Over $2.4 million in unpaid duties is owed on the first group, nearly $1.5 million is owed on the second, and over $3.7 million is owed on the third group. The complaint argues that Aspects Furniture Manufacturing is liable for the first group of entries, while Aspects Furniture International is liable for the second and third groups as the importer of record for the entries.
The U.S. alleged that in 2013, Aspects Furniture Manufacturing began diverting assets to Aspects Furniture International through a purchase agreement that sent the assets, operations, intangible property and perpetual licenses of Aspects Furniture Manufacturing to Aspects Furniture International. The new company began importing under its own name in 2013 but carried on the same business as its predecessor and, despite the fact that it was incorporated in 2012, advertised as having over 40 years experience in the business.
The government alleged that, despite executing the purchase agreement, "members of the Sivixay family, including Amy Sivixay, continued to exercise substantial control over the assets and operations of both" companies. As a result, the U.S. said Aspects Furniture International is the successor-in-interest to Aspects Furniture Manufacturing and is liable for all duties owed by the company.
The two have "shared overlapping addresses, management, employees (including members of the Sivixay family), lines of business, assets, identity, reputation, goodwill, manufacturing processes, manufacturing relationships, and intangible assets," the complaint said. In 2014, Sivixay allegedly then began diverting assets away from Aspects Furniture International to a new corporate entity: Hospitality.
The government also is looking to hold Sivixay personally liable for duties owed on all three groups of entries under the theory that the three corporate forms are merely an "alter ego" of Sivixay herself. The complaint said she was the "principal organizer of the actions taken by Defendants to avoid paying significant duties to CBP," and includes additional factors such as the fact that the corporate entities were incorporated using Sivixay's personal address. The brief also lays out an "alter ego" theory for Hospitality in a bid to make the company liable for the unpaid duties as well.