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Savoia, Inc., BMX Imports, L.P., BMX Trading, L.L.C., and Terry Zimmer Clean Air Act Settlement

(Washington, DC – January 6, 2014) A Dallas-based group of companies and their owner must either stop importing vehicles or follow a comprehensive compliance plan to settle Clean Air Act (CAA) violations stemming from the alleged illegal import of over 24,167 highway motorcycles and recreational vehicles into the United States without proper documentation, announced the Department of Justice and the U.S. Environmental Protection Agency (EPA). The four parties are also required to pay a $120,000 civil penalty.

Overview of Defendants

Terry Zimmer is a named Defendant and the principal for the other Defendants, Savoia, Inc., BMX Imports, L.P., and BMX Trading, L.L.C. Defendants import (or formerly imported) highway motorcycles and recreational vehicles from several foreign manufacturers (including vehicles sold under the brand names of Peace, Lifan, Buyang, Bashan, Huansong, Wangli, JCL, and Xinyang). Defendants would then sell the imported vehicles throughout the United States from their website and from their retail location in Dallas, Texas.

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The EPA discovered Defendants’ violations through inspections at ports of entry and through a comprehensive information request. The EPA maintains a relationship with the United States Department of Homeland Security’s Bureau of Customs and Border Protection (CBP) whereby CBP inspects vehicles and engines for compliance with the Clean Air Act and its regulations. In this case, inspectors at the port of Long Beach inspected at least nine entries between July 2008 and March 2009 for which one of the Defendants was the importer of record. Next, the EPA issued Defendants a Request for Information, pursuant to section 208 of the Clean Air Act, 42 U.S.C. § 7542. Lastly, in February 2011, EPA representatives inspected vehicles at Defendants’ retail location in Dallas.

This investigation established evidence that that Defendants imported and sold approximately 24,167 recreational vehicles and highway motorcycles in violation of the Clean Air Act and its implementing regulations.

First, over 11,000 of the Subject Vehicles were not covered by an EPA-issued certificate of conformity. In most cases, there was no certificate of conformity that purportedly covers these vehicles. For the remainder, the vehicles fail to conform in a material respect to the vehicle configuration covered by the certificate of conformity that purportedly covers them. For example, some of the vehicles had catalytic converters that were of different dimensions, or had less substrate material and cell density than required.  Second, over 23,000 were improperly warranted. Lastly, over 500 had noncompliant emission control information labels.

Importing and selling these vehicles constitute violations of sections 203, 207, and 213 of the Clean Air Act, 42 U.S.C. §§ 7522, 7541, and 7547, and 40 C.F.R. § 1068.101. Certification, warranty, and labeling are essential requirements for any vehicle imported or sold in the United States because they demonstrate that the vehicle meets federal emission standards for oxides of nitrogen, carbon monoxide, and hydrocarbons. Nearly every one of the 24,167 Subject Vehicles was sold in the United States.

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Injunctive Relief

The Consent Decree would impose two primary elements of injunctive relief.  First, Defendants must either cease, or follow a compliance plan for, all activity regulated under the mobile source provisions of the Clean Air Act for 5 years. This compliance plan calls for quality assurance steps at various stages of purchasing, importing, and selling vehicles. These steps include vehicle inspections and emission testing. The compliance plan is publicly available as Appendix B to the Consent Decree.

Second, the Consent Decree requires Defendants to export or destroy 115 noncompliant recreational vehicles currently in their inventory. These vehicles have catalytic converters or carburetors that do not conform to the application for the COC that is meant to cover these vehicles. These components directly determine the rates of emissions of regulated pollutants, so this nonconformance is material, and these vehicles are not suitable for sale in the United States. 

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Health Effects and Environmental Benefits

Recreational vehicles and highway motorcycles emit oxides of nitrogen, carbon monoxide, and hydrocarbons. Emissions of these pollutants are regulated under the Clean Air Act to prevent childhood asthma, respiratory illness, premature death, and other human health risks. Here, the alleged violations include, for example, claims that vehicles were equipped with less effective catalytic converters than are required, and catalytic converters exist for the purpose of reducing emissions of regulated pollutants. Also, the United States alleges that over 8,000 vehicles were sold into United States commerce without any of the mandatory demonstrations and certifications that the vehicles meet Clean Air Act standards.

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Civil Penalty

The Consent Decree would require Defendants to pay a penalty of $120,000. This penalty is based on the United States’ determination of Defendants’ ability to pay. A much higher penalty is justified by the scale and egregiousness of the alleged violations.

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Comment Period

The proposed settlement, lodged in the United States District Court for the Northern District of Texas, is subject to a 30-day public comment period and final court approval. Information on submitting comment is available at the Department of Justice website.

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For more information, contact:

Evan M. Belser, Attorney Adviser
Air Enforcement Division
Office of Civil Enforcement
Office of Enforcement and Compliance Assurance
United States Environmental Protection Agency
1200 Pennsylvania Avenue
Washington, D.C. 20460
(202) 564-6850

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