Lawsuit Filed By Attorney General After Undercover Investigation Revealed Brooklyn Online Distributor Sold And Promoted Mislabeled Intoxicants Upstate And Out-Of-State, According to the Petition; Investigation Arises From Earlier AG Action That Stopped Head Shops Across NYS From Selling Mislabeled Drugs
Schneiderman: We Will Go After Those Who Flood Our Communities With Dangerous Drugs
NEW YORK – As part of an ongoing initiative to stop the sale of so-called designer drugs, Attorney General Eric T. Schneiderman today announced that his office filed a lawsuit and won a temporary restraining order that prohibits Brooklyn-based KMG Direct, Inc., High Life USA, LLC, and owner Eli Kleiger, from selling synthetic drugs and commonly-known street drug alternatives, for example “salvia,” a powerful hallucinogen, and “spice,” which produces experiences similar to marijuana. The petition, filed in Supreme Court in Onondaga County, and order comes after an undercover investigation revealed that employees of the online, mail-order distributor and retailers were violating state labeling laws by selling and promoting dangerous and illegal drugs in New York State and Colorado.
The sale of designer drugs has contributed to a public health crisis in New York State and across the nation. With psychoactive effects similar to those of more commonly known street drugs, these products are typically packaged with innocuous names and bright graphics to give the misleading impression that their use is harmless. Like street drugs, these designer drugs often lead to addiction, psychosis, acute arrhythmia, asphyxiation and even death.
“The proliferation of illegal designer drugs is a health crisis with a national reach, and it is one that is hurting New York families and communities,” Attorney General Schneiderman said. “After successfully stopping 20 head shops across our state from selling these dangerous drugs, my prosecutors and investigators are tracking down dealers who are operating online. There is one set of rules for everyone, and whether you are selling illegal drugs on the street or on the web, you must stop -- or we will stop you.”
The Attorney General’s investigation found that the distributors named in the lawsuit were labeling dangerous products with names like “KratoMonster,” “ZanziBarz,” “Vector,” “Sativah,” “BaliDiesel,” “Salvia Max” or “Salvia Zone,” and marketing them with false descriptions such as “dietary supplement,” or “Euphoric Relaxation Tablets.” Some products had practically no label information and most lacked comprehensive ingredient lists, warnings and directions for use, as required by law. Without ingredient disclosure, adequate usage and warning information, the labels are deceptive and the drugs are dangerous for consumers. The investigation revealed sales being made in New York, and as far away as Colorado.
The Attorney General’s lawsuits have also pursued retailers for illegal sale of nitrous oxide, better known as “Whip Its,” to the public, a specific violation of the State Public Health Law. Nitrous oxide has been linked to deaths by asphyxiation and other adverse health effects. The gas is typically used by youths who see it as an easy “high.”
Today’s lawsuit is part of an ongoing effort by Attorney General Schneiderman’s office aimed at stopping the sale of designer drugs. The initiative, which began in 2012, successfully removed street drug alternatives and synthetic drugs from the shelves of numerous head shops across New York. The Attorney General’s office has filed dozens of lawsuits against head shops that sold designer drugs, which resulted in judges across the state issuing permanent injunctions barring stores from selling these products. The rulings came after the office showed the products were illegal because their contents are not properly labeled, thus violating state and federal laws.
This newest lawsuit is the result of information received from the Colorado Attorney General’s Office that Kleiger’s companies were shipping drugs from New York to customers in Colorado. That tip came after Colorado prosecutors, in the course of their efforts to combat the scourge of designer drugs in their state, contacted Attorney General Schneiderman’s office about New York’s successful actions against head shops.
From March to September of this year, senior investigators from the Attorney General’s Office made multiple buys from wholesalers KMG and High Life, and their affiliated online storefronts, which operated out of a large warehouse located at 33 35th Street in Brooklyn. Operating on the phone and the internet, the agents purchased a variety of mind-altering substances including Xanax-lookalike pills called ZanziBarz, “Vector” party pills containing a banned stimulant, two smokable “spice”-type products named “BaliDiesel” and “Sativah,” psychoactive pills called “KratoMonster,” and multiple strengths of the highly hallucinogenic herb salvia, branded “Salvia Zone,” and “Salvia Max.” The agents also bought a variety of drug paraphernalia including disguised digital scales, grinders, crack pipes, marijuana pipes, among other items. The agents purchased a large box of nitrous oxide (N2O) along with the paraphernalia used to ingest the gas at a controlled pace.
A total of four deliveries were shipped to a P.O. Box on Hiawatha Boulevard in Syracuse in the name of a fake head shop, the Hiawatha Phatty Shack, created by Attorney General investigators.
The lawsuit is seeking an accounting of all commodities sold or offered for sale by the companies, including the name of the product, the manufacturer and distributor of the product, a description of the product, the wholesale and retail prices of the product and the number of units sold. Federal and state laws and regulations require that all consumer commodities, at a minimum, be labeled to describe net contents, identity of the product, and the name and place of business of the product’s manufacturer, packer, and distributor. Drugs of any kind must be further labeled with particularized directions for use and comprehensive, intelligible warning information.
Although federal and state authorities have outlawed certain chemicals and their analogs in order to remove these items from commerce, their efforts continue to fall short as the chemists and producers providing the products to head shops simply alter formulas to stay ahead of the legislation.
The Attorney General’s office has obtained an affidavit from the medical community highlighting the need to combat these drugs. Dr. Maja Lundborg-Gray told the Attorney General’s office that patients who have taken these street drug-alternatives are frequently violent and present a definite danger to the public and first responders who care for them. As one label noted, consumption was expected to cause headache, disassociation, and/or an altered sense of perception. Ingestion was to take place only when sitting or lying down. “Always have a sitter present,” cautions the label.
Maja Lundborg-Gray, M.D., of Samaritan Medical Center in Watertown, said, “There is a completely new level of violence and unpredictability associated with these patients. This demonstrates the gravity of the danger posed by users of designer drugs. I support Attorney General Schneiderman’s efforts of getting these unlabeled, misbranded and misleading so called ‘designer drugs’ off store shelves in New York State.”
Like the earlier cases, the lawsuit, filed yesterday, and TRO, signed today, seek a permanent injunction against the online distributors, barring them from selling misbranded designer drugs. Further information about previous cases is available here.
The investigation was conducted by Attorney General investigators David Buske, Dennis Churns, Chad Shelmidine, Supervising Investigators Richard Doyle and Chris Holland and Deputy Chiefs of Investigations Antoine Karam and Jonathan Wood. The Chief of Investigations is Dominick Zarrella.
The case is being jointly prosecuted by Assistant Attorney General Judith Malkin, and Assistant Attorneys General In-Charge Vincent Bradley and Deanna R. Nelson, who are led by Executive Deputy Attorney General for Regional Offices Martin J. Mack.