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article imageCEO of Gibson Guitar says Fed raid cost company up to $3 million

By Michael Billy     Aug 31, 2011 in Politics
When dozens of federal agents raided two Gibson guitar factories – one in Nashville and one in Memphis – and seized several pallets of wood they cost the company a lot of dough, according to Gibson's CEO. is reporting that Gibson CEO Henry Juszkiewicz said, regarding the cost of the raid, "my personal guess is somewhere in the neighborhood of $2 million to $3 million."
While the feds are staying muted on the situation, a Gibson press release has revealed some details of the raid.
The raid has resulted in both factories being shut down after dozens of federal agents executed four search warrants.
Gibson employs 2,000 people in the United States, according to Juszkiewicz.
The government is fretting the maker of the famous Les Paul guitar because of alleged violations of recent amendments to the 1990 Lacey Act, which outlaw the import of foreign plants that break a law of the country of origin.
The press release says the U.S. Department of Justice is claiming that the wood in question violates an Indian law that requires the wood to be finished by Indian workers. It also points out that the raid was not supported or sanctioned by the Indian government.
The release, however, also notes that the wood was from a Forest Stewardship Council certified supplier.
Juszkiewicz says the feds are focusing in on his guitar company like they are a solo act while, in reality, there's a full band of companies that import the same wood.
“We don’t what is motivating it,” Juszkiewicz said. “It is one, clear to me that there is some terrific motivation because we are not the only company that uses this type of wood. Virtually every other guitar company uses this wood and this wood is used prominently by furniture and architectural industries, and to my knowledge none of them have been shut down or treated in this fashion.”
This is not the first time this has happened, either. The release notes that a similar seizure took place in 2009:
In 2009, more than a dozen agents with automatic weapons invaded the Gibson factory in Nashville. The Government seized guitars and a substantial amount of ebony fingerboard blanks from Madagascar. To date, 1 year and 9 months later, criminal charges have NOT been filed, yet the Government still holds Gibson’s property. Gibson has obtained sworn statements and documents from the Madagascar government and these materials, which have been filed in federal court, show that the wood seized in 2009 was legally exported under Madagascar law and that no law has been violated. Gibson is attempting to have its property returned in a civil proceeding that is pending in federal court.
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