On June 23, 2025, the United States Court of Appeals for the Ninth Circuit affirmed a district court judgment in a case in which the jury found the defendant knowingly made false statements on customs forms to avoid paying duties on Chinese imports.[1] The decision affirms an expansive application of the False Claims Act (“FCA”) that plays directly into the hands of the Trump administration’s evolving enforcement priorities.
Qui tam plaintiff Island Industries, Inc. (“Island”) filed suit under the FCA against Sigma Corporation (“Sigma”), a pipe fitting manufacturer and Island competitor, alleging that Sigma made two types of false statements on customs forms to evade antidumping[2] duties that applied to welded outlets.
Island alleged that Sigma declared on customs forms that products it was importing were not subject to antidumping duties and that it described the products as steel couplings even though they were marketed as welded outlets. The welded outlets, Island asserted, were subject to an antidumping duty order that covered certain pipe fittings imported from China. The jury returned a verdict in favor of Island, finding Sigma liable for violating the FCA and determining that it owed over $8 million (before trebling). The district court denied Sigma’s subsequent post-trial motion for judgment as a matter of law or a new trial.
In affirming the district court, the Ninth Circuit rejected Sigma’s contention that 19 U.S.C. § 1592, which provides a specific mechanism...
The Department of Justice (DOJ) is rapidly expanding the scope of False Claims Act (FCA) enforcement, and contractors with federal funding are squarely in the crosshairs. Deputy Attorney General T...