A blogger named Martin as Gibson's competitor early on, which was easy, because Chris Martin IV is an unabashed Democrat. The blogger new enough about guitars to have heard of Martin. Try tracking down the owner and relatively new CEO of Fender.
That blog also said that Martin "used" the same wood, not that Martin got it in the same way. As of course, the 'use' of the wood was never at issue.
That blog mentioned Gibson CEO's Henry Juszkiewicz's few Republican contributions and those he made to an industry group; the blog didn't mention that Juszkiewicz also contributed to Democrats. In fact, the blogger mentioned that he used opensecrets.org, but he didn't mention that the most recent contribution shown on opensecrets.org for Juszkiewicz is one to Democrat Congressman Cooper of Tennessee.
The blogger also didn't mention how involved Juszkiewicz and Gibson are in liberal causes, nor the close relationship between Juszkiewicz/Gibson and Bill Clinton.
From that point, it was like the kindergarten game of 'telephone.' It just got repeated.
And yes, Chris Martin IV is a very heavy Democratic supporter. Other than that, he's pretty quiet. Juszkiewicz is sort of like Ted Turner. He's loud, he's brash, he's everywhere. He's involved in all kinds of liberal causes (Poetry slams for diversity and tolerance? United Nations day of diversity and tolerance? Rainforest alliance? John Lennon touring museum bus? MTV Rock the Vote? Clinton Global Initiative? - that's all Juszkiewicz, not Chris Martin).
First, no new wood is involved. This is the wood that was seized in the August 24, 2011, raid.
The new lawsuit is United States vs. 25 Bundles of Indian Ebony Wood, Case No. 3-11-CV-00913 (U.S. District Court for the Middle District of Tennessee). Earlier this week, a U.S District Judge denied all of Gibson's motions in the ongoing civil case (United States v. Ebony Wood in Assorted Forms, 3-10-cv-00747) and stayed that civil suit after reviewing evidence that continuing to allow civil discovery, at this time, would likely adversely affect the investigation and the prosecution of a related criminal investigation. The evidence came from the Environmental Crimes Section, Environment and Natural Resources Division of the United States Department of Justice, not the Civil Forfeiture Division that was prosecuting the civil forfeiture action.
The court had originally heard the evidence in June and was asked to stay the action then but, after a status conference hearing on July 29, Gibson indicated that it would fully cooperate with the government in answering interrogatories that had been served on Gibson in November 10. The government (not the court) had given Gibson multiple extensions to answer, but Gibson had not fully answered them. Gibson failed to answer the interrogatories, the government renewed its motion for a stay on September 21, and the District Court denied all of Gibson’s motions and stayed the case on September 28.
There are 68 filings in the stayed action - some 178 pages long, with exhibits of internal Gibson emails about dealing with Roger Thunam, a convicted smuggler whose wood was under current seizure by the Malagasy government (a Gibson employee, named Gene Nix spent 2-1/2 weeks in Madagascar and reported back that there was no legal source for the wood)- but they suggest that the target(s) of the criminal investigation may be Theodor Nagel GmbH, a Germany company whose exclusive source for Madagascar ebony and rosewood was Thunam. The owners of Nagel also own a company in California called Luthiers Mercantile International.
Nagel and LMI come into play in the August 2011 raids.
What I know about the facts keep changing because the filings in the civil forfeiture action contains more information than the original affidavit for the search warrant.
On June 10, 2011, Atheena Exports of India, documented the export of “finished parts of musical instruments” to the final consignee, Theodor Nagel GmbH (the German company) in the U.S. The customs paper described the product as a finished part for musical instrument under the international Harmonized Schedule for customs and tariffs (9209 – I’ll leave off the sub categories).
On June 27, 2011, a shipment of Indian ebony is stopped by Customs and Border Patrol (CBP) agents at the Dallas, Texas Port of Entry (the DFW airport). There’s no Lacey Act declaration. The shipment is marked as 4408 (WOOD VENEER <6MM THICKNESS). It’s not marked 9209, which would have required payment of a tariff. The paperwork says to notify Luthiers Mercantile International of California upon arrival and to ship interstate to the address of a Red Arrow Delivery Service Warehouse in Nashville. Nothing on the paperwork says there’s a final consignee in Nashville other than Nagel. Gibson’s name doesn’t appear anywhere on any paperwork.
Veneer (4408) makes sense. A guitar maker uses it on the headstock of guitars and bends it to make the back and sides of acoustic guitars. India’s HS specifically says that 4408 products may be exported without tariff.
Customs agents inspect the container. It doesn’t contain veneer. It contains rough pieces of cut wood about 10mm thick – they’re fretboard blanks. Since 1993, customs rules have said that guitar fretboard blanks are a 4407 item (cut, split, or chipped wood over 6mm thick). Guitar makers (luthiers) had sought that HS classification because it kept them from paying a tariff on a 9209 finished item.
Unfortunately, Indian law prohibits the export of 4407 items (India’s HS is online; I’ll post it for those who doubt it).
Natalie Swango, the General Manager for LMI shows up and produces a Lacey Act declaration that was signed back on June 17, before the shipment arrived. It was never filed. The Lacey Act declaration shows Gibson Guitars as the final consignee with a note, “Attention: Herb Jenkins.” Herb Jenkins orders wood for Gibson.
According to the Wildlife Inspector (and confirmed by Swango, because she later says she was mistaken in telling the WI), she says that Gibson is the final consignee and the import paperwork is wrong.
The feds track the shipment to the Red Arrow Delivery Service Warehouse.
There, they find another shipment of fretboard blanks from India. This shipment came in through Canada on paperwork listing LMI as the final consignee. The WI speaks with a manager at the warehouse (her name’s in the documents) who says that the wood belongs to Gibson and is delivered to Gibson as Gibson asks for it. The manager also gives the WI an email from LMI stating that LMI is not the final consignee, despite what’s shown on the import and customs papers. Gibson Guitars is the final consignee.
The feds raid Gibson and the Red Arrow warehouse and seize wood, computers and a thumb drive.
Contrary to everything that was written in the press and reported on blogs for a month, the feds seized Indian ebony, not rosewood. That doesn’t make much of a difference, but it does show that you can’t believe all the details you read.
LMI has now submitted revised paperwork stating that the correct import code should have been 9209.
So . . . U.S. law says that fretboard blanks are a 4407 item and aren’t subject to tariff. U.S. law has said that since at least 1993. Indian law prohibits the export of 4407 items.
U.S. law says that finished products for musical instruments are 9209. Indian law permits their export.
In this case, LMI and Theodor Nagel tried three different HS codes, avoided paying tariffs, changed the HS code and description to a product that Indian law permitted to be exported without tariff, engaged in some kind of strange clusterdance regarding who happened to be the true final consignee depending on the time of day.
LMI and Nagel are probably the targets of an ongoing criminal investigation, based on what’s happened in the other civil forfeiture action.
So . . . as I said. It’s not nearly as simple as it seems.
I’ve read all of the documents in the Madagascar case that was just stayed. I’ve been following it since it was filed. I’ve read the Gibson emails and other statements – as well as some of Gibson’s admissions in discovery.
In the case of the August 2011 raid, I think the government is technically correct on the law but has taken a position that isn’t practical. However, Gibson imported fretboard blanks from India eleven other times in the last thirteen months and the government didn’t confiscate any of those shipments, nor raid Gibson any of those times. The involvement of LMI and Nagel, the repeated changing of the HS code, the use of ‘ghost’ final consignees, and misleading descriptions (that, of itself, a Lacey Act violation), could be the problem here. That could make the wood contraband when LMI/Nagel imported it and before Gibson touched it.
I think Gibson should get its wood back from the 2011 raid – unless there are damning documents in Gibson’s computers, like the motherlode of damning emails in Gibson’s computers regarding Gibson’s knowing purchase of Madagascar wood, our from under government seizure, from a convicted wood trafficker just released from custody, after noting that there was no “legal” or “legitimate” source for the wood. As for the Madagascar ebony? If you read those documents, when you almost certainly agree that Gibson knew it was taking a risk (or knew it was doing something illegal) and it got caught.
The 2011 raids? What’s the government going to do? Ask the Indian producers to run a router along one side of the fretboard blank?