News

The IPR Center Report

Partners in Action

Volume 2, No. 3 • September 2009

Major Supplier of Counterfeit Goods Receives 17 ½-Year Sentence

In September 2006, U.S. Immigration and Customs Enforcement (ICE) special agents executed 15 federal search warrants at various independent urban clothing stores and convenience stores throughout the New Orleans area. As agents began seizing hundreds of counterfeit goods, they also uncovered a larger scheme. Through interviews and other investigative techniques, agents soon discovered that the counterfeit goods were all supplied by one individual, southern Louisiana resident Charles Neuman. It was further revealed that Neuman had an extensive criminal history, with prior convictions for first-degree robbery and felony possession with intent to distribute over 100 lbs. of marijuana.

Neuman, once a legitimate businessman, modified his business to sell counterfeit Nike shoes along with counterfeit clothing and handbags. The illicit goods were purchased in bulk from international importers in New York City that had direct connections to illicit manufacturers in China. Neuman used tractor-trailer trucks to transport the counterfeit merchandise from New York to his warehouse in Louisiana. Neuman and his associates then used his storefront XXXCYTE to sell counterfeit goods to store owners and individuals throughout Louisiana, Mississippi, Alabama and Florida.

In a separate, parallel investigation, ICE special agents in Buffalo, New York, identified Hebin “Julie”Wang as a purchaser and importer of container loads of counterfeit Nike shoes directly from China. Buffalo agents identified several telephone conversations between Wang and Neuman, during which the targets negotiated the sale and transportation of counterfeit Nike shoes from Wang’s warehouse in New York City to Neuman’s warehouse in Louisiana. Though Buffalo’s investigation resulted in Wang's arrest, Neuman and his business associates throughout the Gulf Coast went on with their business as usual.

In October 2007, ICE agents executed six federal search warrants, resulting in the seizure of four vehicles and $764,125 in counterfeit goods from Neuman.Within several days, agents served three more search warrants at UPS, intercepting and seizing deliveries of counterfeit Nike shoes and Polo shirts being shipped from New York to Neuman’s business. Once again, Neuman was undeterred, as he continued to sell his counterfeit Nike shoes throughout the South.

ICE agents continued to take action against Neuman, and in February 2008, he and his warehouse manager Justin Nichols were indicted in the Eastern District of Louisiana. The following month, ICE agents arrested Neuman at a casino in Biloxi, Miss., and Nichols was arrested the following day in Louisiana. Nichols pled guilty to misprision of felony and was later sentenced to two months in federal prison.

Neuman opted for a jury trial and was ultimately convicted on all five counts of the indictment: two separate counts of trafficking in counterfeit goods, one count of facilitating the importation of counterfeit goods, one count of conspiracy to traffic in counterfeit goods and one count of felon in possession of a firearm.

On July 29, Neuman was sentenced to 210 months—17½ years—in federal prison, a severe punishment that sends a firm message to others involved in the counterfeiting trade.