Two Chinese Nationals Sentenced For Trafficking Counterfeit Cell Phone Cases

Boston – Two Chinese nationals, living in Massachusetts, were sentenced today in federal court for importing and reselling counterfeit cases for cell phones.

U.S. District Court Judge F. Dennis Saylor, IV, sentenced Zexiong Chen, 28, to 18 months in prison, one year of supervised release, a fine of $6,000 and restitution in the amount of $4,820. Haotian Chen, 26, was sentenced to time served which was one day in prison, one year of supervised release, a fine of $4,000 and restitution in the amount of $4,829. In September 2014, the defendants pleaded guilty to trafficking in counterfeit goods. In February 2014, Zexiong Chen was arrested at JFK International Airport as he prepared to board a plane to China. He has been in custody since then. Haotian Chen was also arrested in February 2014 and was released by the Court on conditions.

In February 2013, the defendants incorporated Max Wireless Group, Inc. as a vehicle for importing and reselling cell phone cases, many of which were counterfeit. Through Max Wireless, the defendants imported counterfeit cell phone cases from China, sold a small percentage of them through their Wakefield store, and sold the vast majority of them to individuals and companies who resold them at retail locations. Many of these retail locations were kiosks in shopping malls, some of which were in Massachusetts.

On 12 occasions from November 2012 through August 2013, U.S. Customs and Border Patrol officials inspected shipments the defendants imported from China to the United States and determined that these shipments contained counterfeit items. These 12 seizures included more than 10,000 counterfeit cell phone cases, bearing marks of manufacturers including: OtterBox, Speck, Kate Spade, Hello Kitty, Ferrari and LifeProof. On Sept. 4, 2013, federal agents searched the Max Wireless store and found more than 2,500 counterfeit cell phone cases and accessories.

The total of the retail price for the authentic versions of all of the products seized totaled more than $350,000. The defendants paid far less for the counterfeit cases and typically resold the cases for substantially less than the suggested retail price.

United States Attorney Carmen M. Ortiz and Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement today. The case was investigated by Homeland Security Investigations and prosecuted by Assistant U.S. Attorney Adam Bookbinder, Chief of Ortiz’s Cyber Crime Unit.