Sunday, August 28, 2011

Gibson Guitars and Federal Intimidation

In late 2009, Gibson Guitars was raided by the federal government and a little over $500,000 in wood and other materials were seized. The premise of the 2009 raid was that Gibson was importing and using Madagascar wood, primarily ebony and rosewood, for their fretboards. Supposedly, the imported wood Gibson was using violated the Lacey Act (http://www.aphis.usda.gov/plant_health/lacey_act/index.shtml). The Lacy Act was first introduced and passed Congress in 1900. Its primary target was the movement of game and wild birds from one state to another for hunting purposes in an effort to preserve those species in their natural habitat.

Over the years, the Lacey Act has undergone several revisions and amendments to expand its reach to include international importation of wood and plants. When Gibson was raided in 2009, the accusation was that they were using wood that had been improperly imported from Madagascar. What made it improper was that it could not be immediately documented by Gibson as to whether the wood was cultivated, naturally fallen, or wild growing. Cultivated (farmed) wood, if properly documented, is permissible; naturally fallen wood (a tree that dies naturally) is also permissible; wild growing harvested wood is not permissible. Gibson relies on their international suppliers to provide the certification that the imported wood complies with international law, import and export regulations, and with the Lacey Act. According to Gibson, they fully cooperated with the Department of Justice and were able to prove after the 2009 seizure that the wood they were using was legal, even providing sworn statements from the Madagascar government that the wood they had imported met Madagascar exportation laws. They apparently requested on several occasions that the Department of Justice return the seized materials or file charges, neither of which happened. Remember that the seized wood represented a major financial drain on Gibson, interfered with production, and cost Gibson a lot of money.

(Madagascar Ebony Wood)

In June 2011, Gibson filed a court action requesting that their materials be returned by the Department of Justice. In August 2011, the DOJ again raided Gibson, this time on the premise that wood Gibson had imported from India violated India's export laws. The basis of the violation seems to be that Indian law prohibits the exportation of wood that is unfinished by Indian workers. What Gibson was importing was partially finished wood that their workers then finished by staining the wood, perhaps installing position markers, those kinds of final finishing touches. Gibson's international supplier of Indian wood is certified by the Forest Stewardship Council (http://www.fsc.org/). On August 25, 2011, Gibson issued a press statement concerning the August 2011 raid and the history as it related to the 2009 raid (http://www.gibson.com/absolutenm/templates/FeatureTemplatePressRelease.aspx?articleid=1340&zoneid=6).

(Unfinished Indian Rosewood)



This is not a small matter. The Wall Street Journal has pointed out ( http://online.wsj.com/article/SB10001424053111904787404576530520471223268.html?mod=googlenews_wsj) that musicians who travel internationally may find themselves under federal scrutiny, and not just if they own a Gibson guitar. The owners of vintage guitars seldom if ever have records documenting the sources of their guitar's construction materials. If your tuning pegs are ivory, what kind of ivory? How was it gotten? Is that fretboard rosewood? Where did it come from? Can you turn to the manufacturer and reasonably expect them to provide you with this information? Records get old, get lost, suffer water or fire damage. Records simply cannot always be found. And, if you can't prove that your guitar is compliant with all applicable laws governing its wood and ivory components, import and export regulations and treaties, what then? Can it be seized as a presumptive violation the way Gibson's materials were? What if you decide to sell your old guitar? What records will you have to be able to present to a prospective buyer?

(Vintage Gibson--What's it made of? Where did the materials come from?)




These are very real and serious issues that musicians everywhere will have to consider as they prepare to buy or sell their new or used instruments, plan their tours, etc. Right now, especially if you own a Gibson guitar, you are vulnerable to whatever hoops the federal government decides to place before you and require you to jump through. Whether Gibson initially violated laws that led to the 2009 raid waits to be seen since the Department of Justice has failed to file any charges resulting from that seizure and has, as a result of Gibson's June court filing, asked the court for a stay. That is to say, for two years, the federal government sat on Gibson's seized materials without taking any action until forced to do so by Gibson's filing. With the August raid coming on the heels of Gibson's attempt to seek relief from the court, and the fact that it is based on an entirely new and separate but equally squishy set of issues, my own feeling is that this action amounts to raw intimidation being exercised by the Department of Justice; they are making an example of Gibson, demonstrating just how easy it would be to destroy your business if that is what they decide they want to do.




This issue is no longer about simply protecting trees and complying with treaties. This issue has reached a new and much more disturbing plane, the government's ability to seize your property and seriously injure your business, then sit back for two years, only to do it all over again when you finally exercise your right of petition. There is much here to ponder.

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