Dallas Importer Pays $12.4 Million After Quartz Duty-Evasion Allegations

Key Takeaways

• $12.4 Million Settlement: Allied Stone Inc. and President Jia “Jerry” Lim will pay $12.4 million to resolve allegations of evading antidumping and countervailing duties on Chinese quartz imports.
• Duty Evasion Scheme: The company allegedly misclassified quartz as marble or crystallized glass between 2018 and 2023 to avoid higher tariffs.
• Whistleblower Payout: Relator Melinda Hemphill, who filed the qui tam case, will receive over $2.17 million plus attorneys’ fees and costs.
• Civil Claims Only: The settlement resolves civil False Claims Act allegations without admission of liability, leaving potential tax and criminal liabilities intact.

Deep Dive

Allied Stone, a Dallas-based supplier of countertops and cabinetry, has agreed to pay $12.4 million alongside its president, Jia “Jerry” Lim, to resolve allegations that they skirted U.S. trade laws by dodging duties on Chinese quartz imports.

The settlement, announced August 19 by the Justice Department, closes a False Claims Act case accusing the company and Lim of disguising quartz surface products as other materials with lower tariffs, including marble and crystallized glass, between 2018 and 2023.

Federal officials framed the resolution as a warning shot to importers tempted to game the system.

“The Department of Justice will zealously pursue those who seek an unfair advantage in U.S. markets by evading or conspiring with others to evade duties owed,” said Assistant Attorney General Brett A. Shumate.

Acting U.S. Attorney Nancy E. Larson for the Northern District of Texas underscored the point, “This settlement sends a message that U.S. companies cannot turn a blind eye to the evasion of customs duties.”

According to prosecutors, Allied Stone and Lim not only misclassified quartz products to avoid antidumping and countervailing duties but also failed to ensure that third-party importers properly declared and paid what was owed. The alleged misconduct, they said, undercut U.S. manufacturers meant to be protected by these trade safeguards.

Customs and Border Protection, which enforces trade rules on the ground, stressed the broader stakes. “Providing false information to CBP violates the law, and it is imperative that violators face consequences,” said Susan S. Thomas, acting Executive Assistant Commissioner of CBP’s Office of Trade.

The case was brought under the False Claims Act by whistleblower Melinda Hemphill, who filed suit in 2021. She will receive just over $2.17 million as her share of the recovery, plus attorneys’ fees and expenses.

The qui tam mechanism has become a mainstay in customs and trade enforcement, incentivizing insiders to expose duty-evasion schemes that are often hidden deep within import filings.

The Settlement Terms

Under the agreement, Allied Stone will pay $12.3 million and Lim $105,000. Both remain jointly liable for the full amount should any portion go unpaid. Roughly half of the settlement represents restitution to the United States.

The resolution is civil in nature, no criminal liability was admitted or resolved, but it does not shield the company or Lim from potential future tax or criminal enforcement tied to the conduct.

Antidumping and countervailing duties may sound like technical trade jargon, but they are central to U.S. economic policy, protecting domestic manufacturers from underpriced imports and foreign subsidies. For Allied Stone, what may have started as a way to cut costs has ended with a hefty bill and a lasting compliance lesson.

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