A self employed Canadian citizen with home and business address in Canada running an LLC there is performing maintenance and selling spare parts (of US origin) permanently for several US companies in California. Her has no employees. His wife is his accountant but I don't know if she is employed and appears on his payroll. He rents a store with a small office in California too.
His customers are producing merchandise for the US market only. He fixes their production machines.

He meets all B-1 visa requirements to work in the US according to the following Website http://www.nafta-visa.com/b1.html except these:
His business and his activities in the US are neither temporarily nor international.
He sends the invoices (in US $) from Canada to his US customers, to their US address from where he gets paid by check in US $, mailed to his Canadian address.
He doesn't fill out any US tax form.
On the W-9 form he gets from his customers he crosses the entire page out and writes with big letters "we are not an US company."
He doesn't fill out a W-8BEN form.
He receives the entire amount of the invoice in full with no withholding.
He makes more than $15k/y (he receives about $200k/y)
He has no professional US license.
He has no city license.
He has no Californian reseller's license.
He charges no sales tax in California.
He doesn't pay Federal- States- Community- Sales- or Income tax in the US and therefore competes easily with local US companies and self employed people.

The Canadian Government in Ottawa doesn't recognize his LLC.

Is this all legal? If not, are his customers, the US companies, also at fault as they don't withhold any taxes?