September 9, 2016: Owner of Major Online Colored Contact Lens Business Pleads Guilty in Largest-Ever Investigation of Counterfeit and Misbranded Contact Lenses in the United States
The owner and operator of Candy Color Lenses, a major online retailer of colored contact lenses in the United States, pleaded guilty yesterday to 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.
Assistant Attorney General Leslie R. Caldwell 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.
Dmitriy V. Melnik, of Las Vegas, pleaded guilty before U.S. District Judge James C. Mahan of the District of Nevada 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, and others had labels of brands of contact lenses produced and sold in Asia, he admitted.
As noted in the plea agreement, all contact lenses are medical devices that must receive FDA authorization to enter the United States and be further distributed. Melnik sold “authentic” contact lenses to tens of thousands of customers around the United States without a prescription, adequate directions for use and 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, according to the plea agreement. Melnik admitted that some of the contact lenses he sold were tested and found to be contaminated with potentially hazardous 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.