Quartz Countertops and the False Claims Act: Misclassification, Transshipment, and Duties Over 500 Percent

Quartz surface products from China are subject to antidumping and countervailing duties that can exceed 500 percent. In August 2025, Allied Stone Inc. paid $12.4 million to settle False Claims Act allegations that it disguised Chinese quartz countertops as marble and crystallized glass to evade those duties. The Allied Stone case is only the most recent chapter in what has become one of the most enforcement-intensive product categories in all of customs law—a category where transshipment, misclassification, and outright fabrication of product identity have generated dozens of EAPA investigations and millions of dollars in FCA recoveries.

The Product and the Orders

Quartz surface products—the engineered stone slabs used in kitchen and bathroom countertops, vanities, flooring, and wall applications—are manufactured by combining crushed quartz (silica) with polymer resins and pigments. The resulting slabs are marketed under brand names like Cambria, Caesarstone, Silestone, and numerous private labels. The U.S. market for quartz surfaces has grown rapidly over the past decade as quartz has displaced granite and marble in both residential and commercial construction.

In April 2018, Cambria Company LLC, the leading U.S. manufacturer, petitioned the Department of Commerce and the International Trade Commission alleging that Chinese producers were dumping quartz surface products in the United States at below fair market value, with the benefit of Chinese government subsidies. At the time, dumped and subsidized Chinese imports were displacing over $1 billion per year in domestic production. Commerce imposed preliminary duties in 2019, and final antidumping and countervailing duty orders took effect under case numbers A-570-084 and C-570-085. The combined duty rates are extraordinary: depending on the Chinese supplier, they range from approximately 300 percent to over 526 percent of the declared value. For the vast majority of Chinese producers without individually determined rates, the effective duties make lawful importation economically impossible.

Allied Stone: $12.4 Million for Calling Quartz “Marble”

The most significant FCA case in this space settled in August 2025. Allied Stone Inc., a Dallas-based supplier of countertops and cabinetry, and its president, Jia “Jerry” Lim, agreed to pay $12.4 million to resolve allegations that they evaded AD/CVD duties on Chinese quartz imports between September 2018 and February 2023.

The fraud was straightforward in concept: Allied Stone allegedly misclassified quartz surface products as other materials—marble, crystallized glass—that were not subject to the AD/CVD orders. By declaring the merchandise under HTS codes for non-quartz stone products, Allied Stone avoided triggering the 300-plus-percent duties that would otherwise apply. The government further alleged that Allied Stone failed to ensure that third-party importers of record submitted accurate classifications on shipments destined for Allied Stone’s inventory.

The case was initiated by a whistleblower: Melinda Hemphill, a former employee of an Allied Stone affiliate, who filed a qui tam complaint under the FCA. Hemphill received $2,170,875 as her share of the recovery, plus reimbursement of over $288,000 in legal fees and expenses. The DOJ described the settlement as demonstrating its commitment to holding accountable those who evade duties “designed to protect US manufacturers and ensure fair competition.”

A Tidal Wave of EAPA Investigations

The Allied Stone FCA settlement sits atop a much larger enforcement record. Since the AD/CVD orders took effect, Cambria and other domestic producers have filed wave after wave of EAPA allegations with CBP, generating an extraordinary volume of investigations and affirmative evasion determinations.

In 2021, CBP initiated EAPA Case 7522 against fifteen importers, finding reasonable suspicion of evasion through misclassification and transshipment of Chinese quartz through Malaysia. By late 2022, CBP issued final affirmative determinations in EAPA Case 7552, finding substantial evidence that all fifteen importers had evaded AD/CVD duties. CBP’s investigation uncovered a coordinated network involving Chinese producers, a Chinese logistics company called Shenzhen Ark Cross-Border Logistics Co. (the “Ark Trans Group”), Malaysian transshipment companies, and the U.S. importers. When CBP began investigating, members of the Ark Trans Group changed the names of their importing entities and Malaysian front companies to avoid detection.

The evasion methods were not limited to transshipment. CBP found that several importers associated with the Ark Trans Group misclassified their entries, declaring the merchandise as “crushed glass products” or “aluminum hydroxide surface products.” CBP conducted laboratory testing of the imported products and determined that the importers had lied: the merchandise was quartz, and it was Chinese in origin.

Separate investigations followed. In 2023, CBP found evasion in EAPA Case 7743 against LTT International Trading Co. for transshipping Chinese quartz through Taiwan. In the same year, CBP determined that Vanguard Trading Company LLC evaded duties by marketing Chinese quartz surface products under the brand name “Lucciare,” claiming they were made from a proprietary “FriTech” material composed of “fritted sand” and “silicates” rather than silica. When CBP requested additional information from Vanguard and its Chinese suppliers, they refused to cooperate, and CBP applied adverse inferences. In 2024, CBP initiated yet another investigation—EAPA Case 7888—against four more importers, including Cosmos Granite, for transshipping Chinese quartz through third countries.

Why the Fraud Persists

The persistence of quartz evasion is a function of simple arithmetic. A slab of engineered quartz might cost $10 to $15 per square foot at the factory gate in China. At a combined AD/CVD rate of 400 percent, the duties alone would add $40 to $60 per square foot—making the product completely uncompetitive. If the same slab can be imported by declaring it as marble (dutiable at a few percent) or by routing it through Malaysia with fraudulent origin documentation, the importer captures the full price spread. On a single container of quartz slabs, the duty evasion can easily reach six figures.

The construction industry’s demand for quartz countertops remains strong, and the price sensitivity of the residential renovation market creates steady demand for lower-cost imported product. Distributors, fabricators, and contractors who purchase from importers may not ask hard questions about the origin or classification of the slabs—or may prefer not to know. This willful blindness, combined with the enormous financial incentive and the difficulty of visually distinguishing quartz from certain other engineered stones, makes the category a persistent enforcement challenge.

How FCA Liability Attaches

Every customs entry summary filed with CBP that declares Chinese quartz surface products under an incorrect HTS code, or that declares a false country of origin, constitutes a false claim within the meaning of the False Claims Act. The Allied Stone case demonstrates that the FCA applies both to the importer that files the false entry and to parties who cause others to file false entries on their behalf. The FCA’s scienter standard—“knowing” conduct, which includes deliberate ignorance and reckless disregard—captures importers who avoid learning the true nature or origin of the products they are bringing into the country.

For potential whistleblowers, the quartz countertop space is unusually promising. The duty rates are so high that even modest import volumes generate large damages. The FCA provides for treble damages plus per-claim civil penalties, and qui tam relators typically receive 15 to 30 percent of the government’s recovery. Melinda Hemphill’s $2.17 million award in the Allied Stone case illustrates what is possible. Employees of importers, distributors, fabricators, customs brokers, and freight forwarders who observe quartz being declared as marble, granite, glass, or some novel proprietary material—or who see Chinese-origin slabs arriving with Malaysian, Vietnamese, or Taiwanese documentation—may have actionable information.

The DOJ’s August 2025 Trade Fraud Task Force, created in partnership with the Department of Homeland Security, has identified customs fraud as a top enforcement priority. The expansion of the Corporate Whistleblower Awards Pilot Program to cover trade and customs fraud provides an additional incentive channel. And CBP’s own EAPA enforcement record on quartz—now spanning dozens of importers, multiple transshipment corridors, and increasingly creative misclassification schemes—confirms that the government is both aware of and actively pursuing evasion in this product category.

If you have information about potential evasion of antidumping or countervailing duties on quartz surface products, an experienced customs fraud and False Claims Act attorney can evaluate your information in a confidential consultation protected by the attorney-client privilege.