Everlight Electronics Co., Ltd., a publicly traded Taiwanese LED manufacturer, has agreed to pay $5.15 million to resolve U.S. allegations of customs fraud tied to Chinese-manufactured components.
The settlement covers Everlight and its Texas-based subsidiary, Everlight Americas, Inc., both of which faced claims under the False Claims Act and the Tariff Act of 1930.
The U.S. Attorney’s Office for the District of Maryland announced the agreement on August 5, alongside U.S. Customs and Border Protection’s Office of Trade.
Allegations centred on the companies knowingly misrepresenting Chinese-manufactured light-emitting diodes as originating in Taiwan to avoid Section 301 tariffs on Chinese goods.
The case began as a whistleblower action filed by Tao Wang, a former Everlight employee, in the District of Maryland under the case number TDC-21-cv-1607.
Wang will receive $876,146, representing approximately 17 percent of the total recovery, as a reward for bringing the allegations to light.
The settlement covers two distinct patterns of alleged conduct spanning from July 2018 through November 2025, making it broader in scope than a typical country-of-origin fraud case.
The first pattern alleged that between July 2018 and January 2022, Everlight transshipped Chinese-manufactured LEDs through Taiwan and declared an incorrect country of origin to evade tariffs.
The second and arguably more significant allegation covers the period from January 2022 through November 2025, when Everlight allegedly imported LEDs from Taiwan containing Chinese-made components without properly segregating them during manufacturing.
That second theory reflects how CBP has been applying the substantial-transformation doctrine to semiconductors, where assembly and packaging operations on a foreign-made die frequently do not confer a new country of origin.
Any importer that assumes a final assembly step in a low-tariff jurisdiction resets the origin of a product is exposed to the same legal risk Everlight now faces.
The case carries wider industry implications, as importers across the electronics sector rely on similar manufacturing arrangements involving components sourced from China and assembled elsewhere.
As the settlement itself makes clear, an importer that declares a false country of origin is not merely underpaying the Treasury but is also underselling every honest competitor in a market where tariffs can exceed manufacturing margins.
The settlement resolves allegations only, and no determination of liability has been made against Everlight Electronics or Everlight Americas.