The U.S. Department of Justice appears to be taking enforcement of the Lacey Act, the country's oldest wildlife protection statute, to a higher level – especially as it relates to policing the trafficking of wood and wood products.
On Aug. 24, 2011, federal agents raided Gibson Guitar Corporation, executing four search warrants on two of Gibson's Tennessee facilities in Nashville and Memphis, resulting in the seizure of several pallets of wood, electronic files and guitars. It was the second such raid on the corporation's Nashville facility in as many years. The other, conducted Nov. 17, 2009 and resulting in the seizure of guitar parts that may have been harvested illegally in Madagascar, was the first enforcement action related to a series of extensive Lacey Act amendments from 2008. At the time, it served as a wake-up call to businesses. According to Gibson CEO Henry E. Juszkiewicz, however, the "wood the Government seized on August 24 is from a Forest Stewardship Council certified supplier and is FSC Controlled, meaning that the wood complies with the standards of the Forest Stewardship Council, which is an industry-recognized and independent, not-forprofit organization established to promote responsible management of the world's forests. FSC Controlled Wood standards require, among other things, that the wood not be illegally harvested and not be harvested in violation of traditional and civil rights." Instead, according to Juszkiewicz, "[t]he Federal Department of Justice in Washington, D.C. has suggested that the use of wood from India that is not finished by Indian workers is illegal, not because of U.S. law, but because it is the Justice Department's interpretation of a law in India."
If Gibson Guitar's interpretation of the allegations is true, the enforcement action appears to be a further warning sign for the business community about increased enforcement. We also understand that the Department of Justice is gearing up for more enforcement actions.
The Lacey Act, initially enacted in 1900, serves as an anti-trafficking statute protecting a broad range of wildlife and wild plants. The 2008 amendments extended the statute's reach to encompass products, including timber, that derive from plants illegally harvested in the country of origin and brought into the United States, either directly or through manufactured products, including products manufactured in countries other than the country where the illegal harvesting took place. A relatively unique aspect to this law is that it is a felony under U.S. law if the subject wood or wood product was collected, harvested, cut, logged, removed, possessed, transported or sold in violation of foreign plant-related laws or regulations. By definition, this requires the U.S. Justice Department to interpret foreign laws and regulations. Violations of the Lacey Act provisions may be prosecuted through either civil or criminal enforcement actions. The penalties are quite substantial, ranging up to five years of imprisonment and a $500,000 fine per violation, as well as forfeiture of the merchandise.
As the U.S. government ramps up its enforcement activities under the Lacey Act, it is obviously important that importers not only familiarize themselves with the requirements of the Lacey Act, but also understand the law of the foreign jurisdictions from which they are importing the wood or plant products. Please keep in mind that the Lacey Act is a fact-based, rather than a document-based, statute. Therefore, documents alone will not protect your company against Lacey Act liability if your company has not performed its due diligence.
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