The owner and operator of Candy Color Lenses, a major online retailer of colored contact lenses in the United States, was sentenced to 46 months in prison today for running an international operation importing counterfeit and misbranded contact lenses from suppliers in Asia and then selling them over the internet without a prescription to tens of thousands of customers around the country.
Acting Assistant Attorney General David Bitkower of the Justice Department’s Criminal Division, U.S. Attorney Daniel G. Bogden of the District of Nevada and Director George M. Karavetsos of the U.S. Food and Drug Administration’s (FDA) Office of Criminal Investigations made the announcement.
In addition to imposing a prison sentence, U.S. District Judge James C. Mahan of the District of Nevada ordered defendant Dmitriy V. Melnik, 30, of Las Vegas, remit $200,000 in restitution and forfeit $1.2 million in proceeds derived from the scheme as well as property seized during the investigation. Melnik pleaded guilty before Judge Mahan on Sept. 8, 2016, to one count of conspiracy to traffic in counterfeit goods and to introduce into interstate commerce misbranded devices.
According to the plea agreement, Melnik imported large quantities of colored contact lenses from the People’s Republic of China and South Korea that he knew were counterfeit and/or unauthorized by the FDA for sale in the United States. Many of these contact lenses bore labels with counterfeit trademarks for Ciba Vision FreshLook COLORBLENDS, which are manufactured by Novartis International AG (Novartis), and others bore labels of contact lense brands produced and sold in Asia, he admitted.
As stipulated in the plea agreement, contact lenses—even decorative ones—are medical devices that if not fitted, worn, or cared for properly can result in serious eye injury including blindness, and must receive prior FDA authorization to enter the U.S. and be further distributed. Melnik admitted, however, that he sold purportedly “authentic” contact lenses to tens of thousands of customers around the United States without a prescription, adequate directions for use or adequate warnings. After purchasing the contact lenses, many customers complained directly to Melnik about the quality of the contact lenses and questioned Melnik about whether the contact lenses were genuine and FDA approved. Melnik admitted that many of the contact lenses that he sold were substandard, and that some were tested and found to be contaminated with a potentially dangerous bacteria.
As stated in the plea agreement, a substantial part of the fraudulent scheme was committed from outside the United States, and Melnik received at least $1.2 million in gross revenue from this illegal enterprise, including approximately $200,000 alone from the sale of counterfeit Ciba Vision FreshLook COLORBLENDS.
Anyone with information about individuals committing intellectual property offenses can report those crimes to the National Intellectual Property Rights Coordination Center by going to http://www.iprcenter.gov/referral or calling (866) IPR-2060.
The prosecution is the result of an ongoing multiagency effort to combat counterfeit, illegally imported and unapproved contact lenses called Operation Double Vision. The FDA’s Office of Criminal Investigations led the investigation, with significant support from the U.S. Postal Inspection Service and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Senior Counsel Matthew A. Lamberti of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Daniel J. Cowhig of the District of Nevada are prosecuting the case.
The indictment is related to the many efforts being undertaken by the department’s Task Force on Intellectual Property, which supports prosecution priorities, promotes innovation through heightened civil enforcement, enhances coordination among federal, state and local law enforcement partners and focuses on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders.