The U.S. Justice Department has filed a civil fraud lawsuit in the U.S. Court of International Trade in New York against Hayward, California-based importer Uni-Tile & Marble, Inc. and its chief executive officer, Xin Mian Pan. Filed on Sept. 28, 2026, the complaint seeks approximately $290 million in unpaid duties and civil fraud penalties, naming the company and its executive jointly and severally over alleged customs duty evasion between 2018 and 2023.
According to the complaint, the federal government is pursuing $67,922,260.09 in unpaid customs duties (about $67.9 million) and a statutory fraud penalty of $222,537,664.95 (about $222.5 million), plus accrued interest. The lawsuit was brought under 19 U.S.C. § 1592(a), a provision of the Tariff Act of 1930, to enforce demands for duties and penalties issued by U.S. Customs and Border Protection (CBP).
The government alleges that between approximately September 2018 and August 2023, the defendants carried out a fraud scheme across approximately 503 entries of wooden cabinets and vanities, quartz surface products, ceramic tiles, and other merchandise imported from China. The allegations in the civil complaint and a parallel criminal indictment remain pending and have not been proven in court.
Civil Complaint and Penalties Sought
The civil action is brought under 19 U.S.C. § 1592(a). The government seeks to enforce CBP's demand for duties and penalties on approximately 503 entries of Chinese merchandise.
According to the complaint, the alleged schemes were designed to avoid the combination rate of antidumping and countervailing duties, as well as additional tariffs including Section 301 duties. The complaint seeks judgment against Uni-Tile and Pan jointly and severally.
Alleged Evasion Mechanisms and Shell Companies
The complaint outlines three primary methods allegedly used by the defendants to evade import duties. First, the complaint alleges transshipment through Malaysia, with Malaysia falsely declared as the country of origin on entry summaries presented to CBP. Second, the government alleges intentional undervaluation of shipments to reduce calculated duty liabilities. Third, the complaint alleges misdescription of merchandise, stating that imported quartz surface products were often falsely described as some other product not subject to antidumping and countervailing duties.
In March 2022, CBP opened an Enforce and Protect Act (EAPA) investigation into Uni-Tile's transshipped entries. According to the complaint, after CBP initiated the EAPA investigation, the defendants allegedly stopped using Uni-Tile as the importer of record and used shell companies instead. Stone Update reports that five shell companies were utilized, two of them set up with stolen identities.
Parallel Criminal Case and Federal Task Force
The civil litigation parallels criminal proceedings announced earlier by federal prosecutors. In December 2025, the U.S. Attorney's Office for the Northern District of California announced criminal charges, including conspiracy, wire fraud, smuggling, and international money laundering, against Pan, Uni-Tile, and other individuals. The criminal case is pending; the allegations have not been proven in court.
Salvatore Ingrassia, Acting Executive Director, Cargo and Conveyance Security, Office of Field Operations, CBP, said: "These civil penalties demonstrate that attempts to undermine our economy and American businesses carry serious consequences." The Justice Department's Trade Fraud Task Force works with CBP and other agencies on compliance with U.S. trade laws.
The case comes as imported engineered quartz also faces the US quartz safeguard tariff-rate quota in force since August 2026. For classification basics, see the natural stone HS codes guide and the guide to importing natural stone.
What It Means for Buyers
- Expect Continued Enforcement: Chinese quartz surface products have long carried antidumping and countervailing duties, and this case shows CBP and the Justice Department pursuing evasion years after the entries were made.
- Scrutinize Country-of-Origin Claims: Country-of-origin declarations for quartz, cabinets, and ceramic tiles represent an active federal enforcement focus; buyers should demand complete factory provenance, production logs, and mill origin certificates from international suppliers.
- Check Product Descriptions and HS Classification: Because importers carry liability for false declarations, purchasing teams should request clear manufacturer details and confirm that invoices describe the product accurately, for example quartz surface products declared as such.
- Exercise Prudence Regarding Below-Market Pricing: Importers and fabricators should be cautious with prices that only make sense if statutory antidumping, countervailing, or Section 301 duties are not being paid.
- Review Duty Terms in Supply Contracts: With safeguard and tariff-rate quota measures now layered on top of existing duties, contracts should state which party bears which duties and who is the importer of record.
