California Skilled Nursing Facilities, Owner and Management Company Agree to $45.6 Million Consent Judgement to Settle Allegations of Kickbacks to Referring Physicians
The Department of Justice announced today that Home Furnishings Resource Group Inc. (HFRG) has agreed to pay $500,000 to resolve allegations that it violated the False Claims Act by making false statements on customs declarations to avoid paying antidumping duties on wooden bedroom furniture imported from the People’s Republic of China (PRC). HFRG, which also operates under the name Function First Furniture, imports, among other things, bedroom furniture that is sold for use in university student housing. The company is headquartered in Hermitage, Tennessee.
“The customs laws are intended to protect domestic companies and American workers from unfair foreign competition,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “This settlement shows our commitment to pursue those who violate these laws and gain an illegal advantage in U.S. markets by evading the import duties owed on foreign-made goods.”
The settlement announced today resolves allegations that HFRG evaded antidumping duties owed on wooden bedroom furniture that the company imported from the PRC between 2009 and 2014, by misclassifying the furniture as non-bedroom furniture on its official import documents. Antidumping duties protect against foreign companies “dumping” products on the U.S. market at prices below cost. The Department of Commerce assesses, and the U.S. Department of Homeland Security’s Customs and Border Protection (CBP) collects, these duties to protect U.S. businesses and level the playing field for domestic products. Imports of PRC-made wooden bedroom furniture have been subject to antidumping duties since 2004. At the time of the alleged conduct in this case, wooden bedroom furniture from the PRC was subject to a 216 percent antidumping duty; non-bedroom furniture was not subject to any antidumping duty.
“CBP is committed to ensuring a level playing field for all American businesses,” said Brenda Smith, Executive Assistant Commissioner, Office of Trade, CBP. “We work with our federal partners to hold accountable those looking to circumvent U.S. trade laws.”
The settlement with HFRG resolves a lawsuit filed in the Western District of Texas by University Loft Company, a competitor of HFRG, under the whistleblower provision of the False Claims Act. The act permits private parties to sue on behalf of the United States those who falsely claim federal funds or, as in this case, who avoid paying funds owed to the government. The act also allows the whistleblower to receive a share of any funds recovered. As part of today’s resolution, University Loft Company will receive approximately $75,000.
The investigation was handled by the Department of Justice Civil Division, Commercial Litigation Branch, with assistance from CBP and the Department of Commerce International Trade Administration.
The lawsuit is captioned United States ex rel. University Loft Company, L.P. v. Home Furnishings Resource Group, Inc., et al., Case No. 15-CV-646 (W.D. Tex.). The claims resolved by this settlement are allegations only; there has been no determination of liability.