Audio electronics company Harman International Industries Inc. has agreed to pay $11.8 million to settle allegations that it evaded U.S. antidumping and countervailing duties on imported electronic components from China.

Harman — known for brands such as Harman Kardon, JBL and Mark Levinson — was accused of importing heat sinks containing extruded aluminum from a Chinese manufacturer from June 1, 2011, through March 31, 2023, without declaring that the shipments were subject to duties.

Harman was able to avoid paying duties on the heat sinks, which were subject to significant antidumping and countervailing rates on Chinese extruded aluminum products during that period, according to a Nov. 26 U.S. Department of Justice press release announcing the settlement.

"For more than a decade, Harman knowingly evaded duties designed to prevent unfair foreign subsidies and trade practices," U.S. Attorney for the Eastern District of Michigan Jerome F. Gorgon Jr. said in a statement. "But we will use the law to protect our American companies against cheaters. And when we catch them, they will pay for it."

According to a settlement agreement filed in federal court, Harman will pay the government $11,809,628 in total, $5,728,034.24 of which is restitution.

The settlement arose from a False Claims Act complaint brought by a Harman-employed U.S. customs compliance and logistics cost specialist.

The relator, Jesrel Mitre, said in his September 2020 complaint that he began working on the importation of heat sinks in 2018 and discovered that Harman was not paying the required duties on the sinks it was importing from a Chinese manufacturer.

The sinks were subject to a May 2011 U.S. Department of Commerce antidumping duty order and countervailing duty order covering a broad range of aluminum extrusions from China, according to the complaint.

While certain finished heat sinks were exempt from the orders, the relator's complaint said the sinks Harman imported did not meet the criteria for the exemption.

In his complaint, Mitre said he encouraged the company to disclose the issue to U.S. customs officials, but the company did not take action.

The relator will receive $2,302,877.46 of the settlement total, according to the agreement.

Harman continues to deny the allegations, according to the settlement agreement. The company did not respond to Law360's requests for comment on Monday.

The federal government is represented by Anthony Gentner of the U.S. Attorney's Office for the Eastern District of Michigan.

Harman was represented by Ted Murphy and Frank R. Volpe of Sidley Austin LLP.

The case is United States of America et al. v. Harman International Industries Inc., case number 2:20-cv-12487, in the U.S. District Court for the Eastern District of Michigan.