Internet-Based Consumer Electronics Vendor To Pay $700,000 To Resolve Claims For Underpaid Postage

Yall Inc., an Internet-based vendor of consumer electronics, and its principal, Hang Feng (Nick) Wu, have entered into a settlement agreement in which they have agreed to pay the United States $700,000 to resolve allegations that they knowingly underpaid postage on large amounts of mail sent through the United States Postal Service. The settlement agreement has been approved by United States District Judge Roslynn R. Mauskopf.

The settlement was announced today by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the United States Postal Inspection Service.

In its complaint, filed in federal court in Brooklyn, the United States alleged that Yall and Wu sent thousands of underpaid mailings to consumers across the nation and around the world. The government further alleged that Yall and Wu failed to weigh the mail before presenting it to the Postal Service for mailing, while representing that their mail was paid in full. The complaint sought recovery under the False Claims Act, 31 U.S.C. §§ 3729-33, among other remedies. Under the False Claims Act, the government can recover up to three times its actual damages, plus penalties of $5,500 to $11,000 for each false claim.

Yall does business through various websites, including Yallstore.com and the online auction and shopping website eBay.com. Yall sells accessories, peripherals and replacement parts, such as batteries, protective cases, AC adapters, and cables for laptops, cell phones, digital cameras, and handheld game consoles, among other popular electronics items.

“Full and fair competition in business requires a level playing field. Mailers who underpay postage gain an unfair advantage over their competitors, while short-changing the Postal Service of necessary funds to carry out its mission,” said United States Attorney Lynch. "We are committed to protecting the Postal Service from abuse and ensuring its financial viability by holding businesses and business owners accountable for underpaying postage.”

“Postal Inspectors will vigorously pursue individuals who underpay the Postal Service. The Postal Inspection Service appreciates the strong stance U.S. Attorney Lynch has taken against those who seek to take advantage of the Postal Service through underpaying postage,” said Inspector-in-Charge Bartlett.

In reaching this settlement, Yall, Inc. and Wu did not admit liability, and the government did not make any concession regarding the legitimacy of the claims.

This case was investigated by the United States Postal Inspection Service and handled by Assistant U.S. Attorney Ameet B. Kabrawala, with assistance from Affirmative Civil Enforcement Auditor Emily Rosenthal.