Man Convicted for Selling Counterfeit Cigarettes

Man pled guilty to trafficking in counterfeit cigarettes before U.S. District Court Judge William P. Dimitrouleas in Fort Lauderdale.

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Robert J. West, Acting Special Agent in Charge, Miami Field Office, and U.S. Food & Drug Administration, Office of Criminal Investigations (FDA/OCI), made the announcement.

On November 13, 2015, Gaurav Joseph Jayaseelan, 25, a citizen of India, pled guilty to selling and dispensing and causing the sale and dispensing of a counterfeit tobacco product, cigarettes, the labeling of which bore the trade name of Newport cigarettes, a tobacco product listed with the FDA under Title 21, United States Code, Section 387(e)(i)(1), in violation of Title 21, United States Code, Sections 331(qq)(3) and 333(a)(2), and Title 18, United States Code, Section 2; and trafficking in 53,740 cartons of cigarettes, while knowingly using a counterfeit mark on and in connection with such cigarettes, the use of which was likely to cause confusion, cause mistake, and deceive. The counterfeit marks were false marks identical to and substantially indistinguishable from the marks of the legitimate manufacturer of Newport brand cigarettes, which were in use by and registered to the manufacturer on the principal register of the U.S. Patent and Trademark Office, in violation of Title 18, United States Code, Sections 2320(a) and 2. 

Jayaseelan faces maximum statutory sentence of up to three years in prison, a fine of up to $250,000, and supervised release of up to three years for selling the counterfeit cigarettes. The defendant faces up to ten years in prison, a fine of up to $2,000,000, and a three year term of supervised release, for the trafficking of the cigarette cartons. The defendant is scheduled to be sentenced on January 22, 2016 at 1:15 pm.

According to the court record, including the a jointly filed factual statement, the investigation began in January 28, 2013, when a FDA/OCI undercover agent met with a third-party in Kingston, Jamaica to discuss the sale of counterfeit Marlboro brand cigarettes. Thereafter, negotiating by email, a deal to sell and ship 1,100 “master cases” of counterfeit Marlboro Reds, for a total cost of $377,300.00 was reached. To pursue the deal, agents made an initial a wire transfer in the amount of $133,190 to an account located in Dubai, United Arab Emirates for the purchase of the counterfeit cigarettes.

In August 2013, FDA/OCI undercover agents met with Jayaseelan, who travelled to Miami, FL from Dubai, as a representative of the producer, to discuss the pending sale.  During the recorded meeting, Jayaseelan told the agents that he and his father, Joseph Jayaseelan were in the cigarette and alcohol business in the Middle East and India.  He also claimed they owned and operated their own tobacco manufacturing plant which could manufacture any tobacco brand.

In December 2013, Jayaseelan sent an email advising they had to temporarily shut down their counterfeit Marlboro plant to avoid detection by law enforcement and offered in the interim to provide counterfeit Newport cigarettes. Subsequently, at Jayaseelan’s request, two cartons of Newport cigarettes to be used as samples for the manufacturing of the counterfeits were provided to an address in India.

In January 2014, an undercover agent was advised by Jayaseelan that the defendant would send 1,030 master cases of Newport cigarettes, for a total value of: $450,625.  Later, Jayaseelan by email advised that the counterfeit Newport cigarettes had been shipped on April 7 to Port Everglades, Florida.  The shipment was seized in Fort Lauderdale by Customs and Border Protection officers, in coordination with FDA/OCI and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) agents. The counterfeit cigarettes had an estimated United States street value of more than $1 million. Jayaseelan was arrested in August 2015 when he traveled to the United States in order to secure further payment on the counterfeit cigarette deal.

“This case represents our relentless commitment to stopping international rings of counterfeiters from jeopardizing products used by American consumers,” stated U.S. Attorney Ferrer.

"A key part of FDA's mission is to protect consumers from counterfeit products -- including cigarettes -- that the agency regulates," said Robert J. West, Acting Special Agent in Charge, FDA Office of Criminal Investigations' Miami Field Office. "We will continue to focus our efforts and resources on removing harmful counterfeit products from the US marketplace."

Mr. Ferrer commended the investigative efforts of the FDA/OCI, Miami Field Office, U.S. Customs and Border Protection (CBP), Port Everglades Office, ICE-HSI, Fort Lauderdale Office, and Broward Sheriff’s Office (BSO) for their assistance in the development of the case. This matter is being prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.