Las Vegas Physician and Wife Convicted of Fraud
Las Vegas, Nev. – A federal jury today convicted a Las Vegas physician and his wife of fraud for treating patients with a non-FDA approved drug and falsely representing to their patients that they were receiving the FDA-approved facial wrinkle treatment, Botox, when they were actually receiving a cheaper unapproved substance, announced Greg Brower, United States Attorney for the District of Nevada.
Following a two-week trial, Stephen Lee Seldon, 53, and Deborah Martinez Seldon, 41, were convicted of 14 counts of Mail Fraud and one count of Adulterating a Drug While Held For Sale. They were indicted in June 2007.
"Dr. Seldon's patients were exposed to potentially very severe health risks, including botulism poisoning," said U.S. Attorney Brower. "Patients should be able to trust their medical care providers to be honest with them and to do their best to 'do no harm'."
According to the court records and evidence introduced at trial, during 2003 to 2005, Stephen Lee Seldon, a licensed medical doctor in Nevada, and Deborah Martinez Seldon, his wife and business partner, operated the medical practice, "A New You Medical Aesthetics" (A New You), at 3663 E. Sunset Road, Suite 303, Las Vegas.
From about October 15, 2003, to September 16, 2005, Stephen Lee Seldon and Deborah Martinez Seldon offered and advertised Botox injections at "A New You." Botox, used for the treatment of forehead wrinkles and excessive perspiration, is the brand name of a drug derived from Botulinum Neurotoxin Type A, a highly potent toxin. When present in sufficient degree in humans, this toxin can cause botulism. The toxin is classified as both a drug and biological product under federal law, and no form may be distributed for use on humans unless it has been approved by the FDA. Allergan, Inc. is the only FDA approved manufacturer of Botox, therefore, all doctors treating patients with Botulinum Neurotoxin Type A are required to use Allergan's Botox products. The Seldons placed advertisements in local magazines offering Botox at low prices, and represented to their patients that Dr. Seldon was certified and specially trained by Allergan for Botox injections. The Seldons also had patients sign consent forms prior to receiving cosmetic procedures. The forms fraudulently represented that the defendant intended to use Botox on the patients, when in fact, Stephen Lee Seldon knew he was going to inject his patients with a cheaper alternative to Botox.
The evidence demonstrated that patients were not receiving FDA-approved Botox at "A New You" and that the Seldons purchased and unlawfully used on their patients an unapproved Botulinum product marketed and sold by Toxin Research International, Inc.(TRI), of Tucson, Arizona. That product, Tritox, was sold in vials labeled, "For research purposes only, not for human use." TRI charged customers much less for Tritox than Allergan charged customers for Botox.
In late November 2004, four individuals in Florida contracted botulism after receiving injections of Tritox at a medical clinic in Florida. An investigation ensued, and as a result, the principal owners of TRI, Chad Livdahl and Zahra Karim, were charged and convicted of Conspiracy and Mail Fraud in federal court in Florida for unlawfully selling almost $2 million of Tritox to physicians and are now serving lengthy prison sentences.
The evidence in this case demonstrated that the Seldons made a secret purchase of $50,000 worth of Tritox less than two months after the four individuals in Florida became sick and after search warrants had been executed at TRI's business location in Tucson. The evidence also demonstrated that the Seldons took steps to conceal their fraudulent use of the cheaper alternative product by falsifying "A New You's" computerized medical records and by making false statements to their patients.
Stephen Seldon and Deborah Seldon are scheduled to be sentenced on February 18, 2009, at 9:00 a.m. by U.S. District Judge Kent J. Dawson. The defendants face up to 20 years in prison and a $250,000 fine on each Mail Fraud count, and up to one year in prison and a $100,000 fine on the Misbranding a Drug count. They are released on personal recognizance bonds pending sentencing.
The case is being investigated by the Food and Drug Administration Office of Criminal Investigations and the United States Postal Inspection Service, with assistance from United States Immigration and Customs Enforcement, and prosecuted by Assistant United States Attorneys Crane M. Pomerantz and Christina Brown.