EAST RUTHERFORD, NJ - Furniture retailer Kid Brands Inc. said it must pay $6.9 million in duties to U.S. Customs and Border Protection for funiture imported by its Kids Line and CoCaLo subsidiaries for the years ended 2006 through 2010 and the six months ended June 30, 2011.
Kid Brands charges, which include approximately $340,000 of interest, will force the company to make an embarassing restatement of financial going back to 2006. U.S. furniture manufacturers who complained about below cost wooden bedroom furniture imports are set to share in the millions collected from Kids Brands and other U.S. importers.
In SEC filings, Stanley Furniture said expects $40 million, La-Z-Boy projects collecting $16 million and Bassett Furniture will receive $9 million. A U.S. Customs spokesperson says checks are being processed now for the furniture manufacturers following a court ruling that restricts disbursements to U.S. furniture manufactuerers who where part of an original complaint against dumping.
In the latest wood furniture antidumping action, almost 200 firms, mostly from China, are subject to an inquiry into whether wood bedroom furniture made there is still being unfairly subsidized by its manufacturers. It is believed to be the largest such inquiry ever.
Separately, Kid Brands said that Lawrence Bivona, LaJobi’s former president who was fired in March 2011 after a board investigation into LaJobi discovered the mounting duties liability, is seeking damages in excess of $25.0 million. Bivona alleges that termination by LaJobi "for cause" violated his employment agreement.
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