FORT COLLINS, Colo. - Smartphone case maker OtterBox has paid a $4.3 million fine to settle claims that it underpaid customs duties on products manufactured overseas for five years.
Colorado U.S. Attorney John Walsh announced the fine Monday. He said a former employee who filed a lawsuit alleging the underpayments between 2006 and 2011 received $830,000 from the fine. The government will keep the rest.
The Fort Collins-based company denies the allegations. CEO Brian Thomas said it has never knowingly underpaid customs duties and noted the alleged violations came at a time of rapid growth.
Companies are required to pay duties both on products made overseas as well as the foreign engineering and tooling work done to support the manufacturing. The government claims that OtterBox only paid duties on the products themselves, not the work.