Everlight Electronics, a Taiwan-based manufacturer, and its subsidiary, Everlight Americas, have reached a $5.15 million settlement with the U.S. government to resolve allegations of customs duty evasion. According to FreightWaves, the companies were accused of knowingly failing to pay required duties on light-emitting diodes (LEDs) imported into the United States.
The Department of Justice (DOJ) initiated the investigation following whistleblower reports alleging that the firms misrepresented the country of origin for Chinese-manufactured LEDs between July 2018 and January 2022. The U.S. Customs and Border Protection (CBP) asserted that the products were manufactured in China and transshipped through Taiwan to evade Section 301 tariffs. Furthermore, the settlement addresses allegations that from the start of the period through November, the company continued to import LEDs from Taiwan containing Chinese components that were not properly segregated.
This settlement follows the recent announcement by the DOJ’s Trade Fraud Task Force that it has surpassed $1 billion in total civil and criminal recoveries, penalties, and forfeitures since its inception in August 2025. The task force, a cross-agency initiative between the Department of Justice and the Department of Homeland Security, was established to address supply chain fraud, mislabeling, and duty evasion.
Case Summary Details
| Item | Detail |
|---|---|
| Settlement Amount | $5.15 million |
| Period of Alleged Violations | July 2018 – January 2022 (and through November) |
| Primary Violation | Section 301 Tariff Evasion |
| Mechanism | Transshipment and Misrepresentation of Origin |
Why It Matters
This case underscores a sharpened regulatory focus on "country of origin" verification within global supply chains. As geopolitical tensions drive more frequent use of Section 301 trade sanctions, the cost of compliance errors or deliberate obfuscation has risen sharply. By targeting transshipment routes, federal regulators are signaling that traditional logistics workarounds—such as minor processing in third-party nations—will no longer shield importers from scrutiny. Companies relying on complex, multi-national manufacturing processes now face a heightened risk of litigation if their internal supply chain segregation fails to meet stringent U.S. customs standards.
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