Blackstone Labs LLC (“Blackstone”) and two of its executives pleaded guilty to conspiring to sell illegal anabolic steroids and other unlawful products marketed as dietary supplements, the Justice Department announced.
According to court documents, Phillip “PJ” Braun, 40, of Boca Raton, Florida, and Aaron Singerman, 41, of Delray Beach, Florida, founded and operated Blackstone, a Boca Raton-based sports and dietary supplements retailer. Braun is Blackstone’s CEO and former President, and Singerman is the former CEO of Blackstone.
On Nov. 17, Braun and Singerman pleaded guilty to conspiracy to distribute controlled substances, in violation of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(E), and 846, and to selling unapproved new drugs, in violation of 21 U.S.C. §§ 331(d), 355(a), and 333(a)(2). On Nov. 19, Blackstone Labs pleaded guilty to the same charges as Braun and Singerman, as well as to one count of conspiracy to defraud the U.S. Food and Drug Administration (FDA) and to commit mail and wire fraud, in violation of 18 U.S.C. § 371.
In pleading guilty, Braun and Singerman admitted to leading a conspiracy to sell products through Blackstone that were labeled as dietary supplements but were actually controlled substances or drugs that were not approved by the FDA. Blackstone made the same admissions, and also admitted to having defrauded the FDA and consumers by selling illegal substances falsely labeled as dietary supplements.
The defendants specifically admitted that, from 2012 through 2017, they conspired to sell products that were unapproved new drugs and/or illegal controlled substances under the Designer Anabolic Steroid Control Act. The defendants admitted that they falsely characterized their products as safe and legal dietary supplements. In addition, they falsely represented that the products were made in “FDA approved” registered facilities that followed all required regulations, when in fact they were not. The defendants also admitted to controlling a supplement manufacturer that fraudulently imported raw ingredients for their products from China. Braun and Singerman both admitted to selling many other products in violation of the Food, Drug and Cosmetic Act, including synthetic stimulants DMAA and DMBA, and the “nootropic” chemical picamilon. The defendants ignored injury complaints from consumers and did not notify the FDA of complaints, even when required by law. As part of their plea agreements, the defendants also agreed to forfeit all proceeds of these crimes, with Braun forfeiting $3 million, Singerman forfeiting $2.9 million and Blackstone forfeiting $1 million.
“Dietary supplements are regulated to protect the health of American consumers,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “The Department of Justice will prosecute individuals and corporations who sell dangerous products while misrepresenting that they are safe and legal dietary supplements.”
“Consumers who use dietary supplements expect those products to be safe. When they contain drugs that are not FDA-approved, the health of the public is put at risk,” said Acting Director Catherine A. Hermsen of the FDA Office of Criminal Investigations. “We will continue to pursue and bring to justice those who place consumers’ health in jeopardy.”
Braun and Singerman are scheduled to be sentenced on Jan. 27, 2022, in Ft. Lauderdale before U.S. District Judge William P. Dimitrouleas of the Southern District of Florida. Both face a maximum penalty of 13 years in prison. Judge Dimitrouleas will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Blackstone is also scheduled to be sentenced on Jan. 27, 2022.
Four other defendants previously charged by indictment in connection with a conspiracy to defraud the FDA, the distribution of unapproved new drugs, and conspiracy to distribute controlled substances have pleaded guilty. One remaining defendant is set for trial on Nov. 23.
The FDA’s Office of Criminal Investigations investigated the case. Trial Attorneys Alistair Reader and Steven Gripkey, Senior Litigation Counsel David Frank and Assistant Director John W. Burke of the Justice Department, Civil Division, Consumer Protection Branch are prosecuting the cases, with assistance from Assistant U.S. Attorney Daren Grove for the Southern District of Florida.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
