Court filing — United States v. Pedersen (Dkt. 1)

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Case 2:20-cr-00216-DBB Document1 Filed 07/23/20 PagelD.1 Page 1 of 12

FILED
2020 JUL 23 PM 4:46
CLERK
JOHN W. HUBER, United States Attorney (#7226) U.S. DISTRICT COURT
JACOB J. STRAIN, Assistant United States Attorney (#12680)
Attorneys for the United States of America
111 South Main Street, Ste. 1800 * Salt Lake City, Utah 84111
Telephone: (801) 524-5682

IN THE UNITED STATES DISTRICT COURT

DISTRICT OF UTAH, CENTRAL DIVISION

UNITED STATES OF AMERICA, FELONY INDICTMENT

Plaintiff, Count 1: 18 U.S.C. § 1341 (Mail Fraud)

vs. Counts 2-3: 18 U.S.C. § 1343 (Wire
Fraud)

GORDON HUNTER PEDERSEN,
Counts 4-7: 21 U.S.C. §§ 331(a),
Defendant. 333(a)(2) (Introduction of Misbranded
Drugs into Interstate Commerce with
Intent to Defraud and Mislead)

The Grand Jury alleges: Case: 2:20-cr-00216
, Assigned To : Waddoups, Clark
I BACKGROUND Assign. Date : 7/23/2020
Description:

At all times relevant to this Indictment:
1. Defendant GORDON HUNTER PEDERSEN (“PEDERSEN”) was a resident of

Utah County, Utah.

2. My Doctor Suggests LLC was a company organized in the state of Utah in and
around February 2012 with its principal place of business in Utah County, Utah. Defendant
PEDERSEN was a 25% owner of My Doctor Suggests LLC.

3. GP Silver, LLC was a company organized in the state of Utah in and around May
2011 with its principal place of business in Utah County, Utah. Defendant PEDERSEN was the

owner and operator of GP Silver, LLC.

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Il. FEDERAL FOOD, DRUG, AND COSMETIC ACT

4. The United States Food and Drug Administration (“FDA”) was the agency of the
United States responsible for, among other things, enforcing the provisions of the Federal Food,
Drug, and Cosmetic Act (““FDCA”), 21 U.S.C. §§ 301 et seg. The FDA protects the health and
safety of the American public by ensuring drugs sold to the public are safe and effective for their
intended uses and that they bear labeling that enables consumers to use the drugs ina safe manner.
The FDA’s responsibilities include regulating the manufacture, labeling, and distribution of all
drugs and drug components shipped or received in interstate commerce. To meet those
responsibilities, the FDA enforces statutes that require drugs to bear labels and labeling that enable
customers to use the drugs in a safe manner and that require drugs to be manufactured in facilities
registered with the Secretary of the United States Department of Health and Human Services.
21 U.S.C. §§ 352(f), 352(0), 360(c).

5. To legally introduce, deliver for introduction, or cause the delivery or introduction
for delivery of a drug into interstate commerce, any person is required to comply with all applicable
provisions of the FDCA and its implementing regulations found in Title 21 of the Code of Federal |
Regulations.

6. The FDCA’s definition of “drugs” includes articles intended for use in the cure,
mitigation, treatment, or prevention of disease in a person; articles (other than food) intended to
affect the structure or any function of the body of a person; and articles intended for use as a
component of such articles. 21 U.S.C. §§ 321(g)(1)(B)-(D).

7. The FDCA defines “label” as “a display of written, printed, or graphic matter upon
the immediate container of any article,” including food and drugs. 21 U.S.C. § 321k). “Labeling”

is a broader term, and is defined as “all labels and other written, printed, or graphic matter upon

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any article or any of its containers or wrappers, or accompanying such article.” 21 U.S.C. §
321(m). Written, printed or graphic matter on internet websites from which one can purchase an
article, or linked to a website from which one can purchase ’an article, may be labeling for that
article.

8. For the purposes of 21 U.S.C. § 360, the term “manufacture, preparation,
propagation, compounding, or processing” includes repackaging or otherwise changing the
container, wrapper, or labeling of any drug package in furtherance of the distribution of the drug
from the original place of manufacture to the person who makes final delivery or sale to the
ultimate consumer or user. 21 U.S.C. § 360(a)(1).

9. People upon first engaging in the manufacture, preparation, propagation,
compounding, or processing of a drug or drugs in any establishment which they own or operate in
any State are required by the FDCA to immediately register with the Secretary of Health and
Human Services, through the FDA, their name, all of their places of business, all such
establishments, the unique facility identifier of each such establishment, and a point of contact e-
mail address. 21 U.S.C. §§ 360(b)(1) and (c)(1). Such persons are also required to annually renew
their registration. 21 U.S.C. § 360(b)(1). |

10. Under the FDCA, a drug is deemed misbranded if any one of the following apply:

a, its labeling is false or misleading in any particular, 21 U.S.C. § 352(a);

b. itis manufactured, prepared, propagated, compounded, or processed in an
establishment not duly registered, or if it is not included in a list of drugs
manufactured by a facility registered with the FDA, as required by 21 U.S.C.
§ 360, 21 U.S.C. § 352(0);

c. itis a prescription drug and at any time prior to dispensing, the label of the

drug failed to bear, at a minimum, the symbol “Rx only,” 21 U.S.C. §
353(b)(4)(A);

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d. its labeling bears inadequate directions for use, 21 U.S.C. § 352(); 21 C.F.R.
§ 201.5; or

e. itis a prescription drug dispensed without a valid prescription by a licensed
practitioner, 21 U.S.C. § 353(b)(1).

Wl. THESCHEME AND ARTIFICE TO DEFRAUD

11. Beginning in and around 2014 and continuing to and around April 28, 2020, within
the Central Division of the District of Utah and elsewhere,
GORDON HUNTER PEDERSEN,
defendant herein, devised and intended to devise a scheme to defraud consumers, and to obtain
money and property by means of materially false and fraudulent pretenses, representations and
promises, and omissions of material facts.
12. In executing and attempting to execute the scheme and artifice to defraud, and in
furtherance thereof, defendant PEDERSEN:
a. knowingly deposited and caused to be deposited in an authorized depository for
mail a matter or thing to be sent and delivered by the United States Postal Service
and by any private or commercial interstate carrier, according to the directions

thereon, in violation of 18 U.S.C. §1341 (Mail Fraud);

b. knowingly transmitted and caused to be transmitted, wire communications in
interstate commerce in violation of 18 U.S.C. § 1343 (Wire Fraud); and

c. introduced and cause the introduction of misbranded drugs into interstate
commerce with intent to defraud and mislead, 21 U.S.C. §§ 331(a) and 333(a)(2).

IV. OBJECT OF THE SCHEME AND ARTIFICE TO DEFRAUD

13. It was the object of the scheme and artifice to defraud for defendant PEDERSEN
to fraudulently obtain money from consumers through false statements, misrepresentations,
deception, fraudulent conduct, and omissions of material facts, and thereafter cause money to be

diverted for defendant PEDERSEN’s personal use and benefit.

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V. MANNER AND MEANS OF THE SCHEME AND ARTIFICE TO DEFRAUD

14. In execution and furtherance of the scheme and artifice to defraud, defendant
PEDERSEN employed the following manner and means:

15. Since at least 2014, defendant PEDERSEN promoted and sold silver products,
through companies including My Doctor Suggests, LLC, and GP Silver LLC, as a treatment for
various diseases, including arthritis, diabetes, influenza, pneumonia, and more recently
coronavirus disease 2019 (COVID-19).

16. The silver products promoted and sold by defendant PEDERSEN list the precious
metal silver as an ingredient for consumers to ingest or apply topically, and are marketed under
various names, including, without limitation, “Silver Solution,” “Silver Gel,” “Silver Soap,” and
“all Natural Silver Lozenge” (collectively hereinafter, “Silver Products”).

17.’ Defendant PEDERSEN’s Silver Products qualify as “drugs” as defined in 21
U.S.C. § 321(g)(1).

18. Defendant PEDERSEN promoted Silver Products under the guise of medical
licensing and authority. For example, defendant PEDERSEN often used the title “Dr.” while
introducing himself in promotional videos. As another example, defendant PEDERSEN claimed
in his promotional videos to be a certified naturopathic doctor. Additionally, the My Doctor
Suggests home page (www.mydoctorsuggests.com) contained an image of defendant
PEDERSEN in a white coat with a stethoscope around his shoulders, creating the appearance of
a treating physician; when in fact, defendant PEDERSEN did not hold a Doctor of Medicine
(M.D.) degree, was not a certified naturopathic doctor, and was not licensed as a medical

provider in the State of Utah.

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19, Defendant PEDERSEN’s promotions directed consumers to purchase Silver
Products through websites, including the My Doctor Suggests Store Page
(www.mydoctorsuggestsstore.com), where an orange digital stamp assured consumers that the
store was “100% Legal.”

20. ‘The list prices on the My Doctor Suggests website ranged up to $299.95 for a
gallon of the Silver Solution, the company’s self-described “flagship product.”

21. Through the My Doctor Suggests Store Page and other websites, defendant
PEDERSEN solicited orders for Silver Products and collected money from consumers.

22, Consumers could place orders through a customer service phone line (1-866-660-
9868), or by adding products to an online shopping cart, which then prompted consumers to fill
out an online order form on the website to purchase products. For both options, credit card
payment was accepted.

23, Defendant PEDERSEN distributed Silver Products by sending them from
facilities in Utah through the U.S. mail or other common carriers throughout the United States in
interstate commerce.

24. Defendant PEDERSEN utilized interstate wires in furtherance of his scheme,
including the My Doctor Suggests LLC customer service phone line, the online internet
storefronts and related emails, as well as promotional broadcasts through the internet and radio.

25. In early 2020, defendant PEDERSEN began fraudulently promoting his Silver
Products as effective protection against, and treatment for, COVID-19 through YouTube videos,
Facebook posts, podcasts, and websites.

26. Defendant PEDERSEN experienced a substantial increase in sales after he began

marketing Silver Products as effective for the prevention and treatment of COVID-19.

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27. There is currently no recognized cure for COVID-19, and no drug product has been
proven safe and effective for the prevention, treatment, and cure of COVID-19; however, in
execution and furtherance of the scheme and artifice to defraud, defendant PEDERSEN made one
or more of the following false and fraudulent statements of material fact to consumers, including,

without limitation, the following:

(a) On January 30, 2020, defendant PEDERSEN posted a video promotion on
YouTube, entitled, “Coronavirus Best Solution! Hand Sanitizers! Structured
Silver Gel from Dr. Gordon Pedersen,” in which he claimed that having silver in
‘his bloodstream would “usher” any coronavirus out of his body. Defendant
. PEDERSEN further explained that he was “going to go out and shake hands with
people, doctors, patients, people who are infected possibly with the flu... and ’m
going to have a confidence level that I have protection.”;

(b) On February 3, 2020, a group called the Silver Health Institute issued a
press release quoting defendant PEDERSEN as stating that, “because the
Coronavirus is a virus and it has been proven that Alkaline Structured Silver will
destroy all forms of viruses, it will protect people from the Coronavirus, as well as
will help people recover more quickly that are suffering from it.” Defendant
PEDERSEN also asserted that once in the blood stream, silver nanoparticles can
block the virus from attaching to their cells, and thus “prevent[] the disease totally
and completely.”;

(c) On February 14, 2020, in a YouTube promotional interview, defendant
PEDERSEN claimed that the Silver Solution had destroyed related coronaviruses
and, notwithstanding disclaimers, he expected a similar outcome against “the
Wuhan version COVID-19.”;

(d) On March 26, 2020, defendant PEDERSEN was interviewed on a podcast
and was asked what he recommends for people considering what they “need to
do” if they are prepping for the COVID-19 outbreak. He replied: “If you
remember nothing else, remember this: silver in this liquid gel and aerosol form
and lozenge form destroys bacteria, and viruses, and yeast, and it does it all at the
same time, and there is no drug that man has made that can do the same. This is
natural, that's why it can do it...If you have the silver in you, when the virus
atrives, the silver can isolate and eliminate that virus.” Defendant PEDERSEN
also stated, “If you don't want to get a germ that's floating around there like the
coronavirus, [take liquid silver] twice a day.”; and

(e) On April 23, defendant PEDERSEN was interviewed on YouTube and
explained, “Whenever I was around someone within six feet [while traveling], I

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had a silver lozenge in my mouth. Now this works because I've taken silver and
put it in a proprietary way into a lozenge.”

28. Defendant PEDERSEN also falsely and fraudulently represented to consumers that
he has Ph.Ds. from Utah State University, in both Immunology and in Biology; that he is Board

Certified in Anti-Aging and Regenerative Medicine; and that he holds a Master’s degree in Cardiac

Rehabilitation and Wellness.

Count 1
18 U.S.C. §§ 1341 and 2(b)
(Mail Fraud)

29. All of the factual allegations set forth in this Indictment are incorporated by
reference and realleged as though fully set forth herein.

30. On or about the date listed in each count below, in the Central Division of the
District of Utah and elsewhere,

GORDON HUNTER PEDERSEN,

defendant herein, having devised and intended to devise a scheme and artifice to defraud, and for
obtaining money and property by means of materially false and fraudulent pretenses,
representations, and promises, and omissions of material facts, and for the purpose of executing
such scheme and artifice and attempting so to do, did knowingly send and cause to be sent and
delivered by the United States Postal Service and any private or commercial interstate carrier, a

matter and thing, and did cause such matter and thing to be delivered according to the directions

thereon as described for each count below:

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count| _ DATE MAILING DESCRIPTION
(on or about)
1. | 04/01/2020 Silver Products shipped from My Doctor Suggests in American

Fork, Utah to Kansas addressed to an undercover alias used by
FDA Special Agent Virginia Keys.

All in violation of 18 U.S.C. §§ 1341 and 2(b).

Counts 2-3
18 U.S.C. § 1343 and 2(b)
(Wire Fraud)

31. All of the factual allegations set forth in this Indictment are incorporated by
reference and realleged as though fully set forth herein.

32. On or about the dates listed below, in the Central Division of the District of Utah
and elsewhere,

GORDON HUNTER PEDERSEN,

defendant herein, having devised and intended to devise a scheme and artifice to defraud, and for
obtaining money and property by means of false and fraudulent pretenses, representations,
promises, and omissions of material facts, for the purpose of executing said scheme and artifice to
defraud, did cause to be transmitted by means of wire communication certain writings, signs and

signals, that is, an interstate wire, in instances including but not limited to each count below:

COUNT DATE WIRE COMMUNICATIONS
(on or about)

2. 01/30/2020 | Defendant PEDERSEN posted a video promotion on YouTube,
entitled, “Coronavirus Best Solution! Hand Sanitizers! Structured
Silver Gel from Dr. Gordon Pedersen,” in which he claimed that
having silver in his bloodstream would “usher” any coronavirus out
of his body. Defendant PEDERSEN further explained that he was
“going to go out and shake hands with people, doctors, patients,
people who are infected possibly with the flu... and I’m going to
have a confidence level that I have protection.”

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3. 03/26/2020 | Defendant PEDERSEN was interviewed on a podcast and was asked
what he recommends for people considering what they “need to do”
if they are prepping for the COVID-19 outbreak. He replied: “If you
remember nothing else, remember this: silver in this liquid gel and
aerosol form and lozenge form destroys bacteria, and viruses, and
yeast, and it does it all at the same time, and there is no drug that
man has made that can do the same. This is natural, that's why it can.
do it... If you have the silver in you, when the virus arrives, the
silver can isolate and eliminate that virus.”

All in violation of 18 US.C. §§ 1343 and 2(b).

Counts 4-7
21 U.S.C. §§ 331 (a), 333(a)(2) and 18 U.S.C. § 2(b)
(Introduction of Misbranded Drugs into Interstate Commerce
with Intent to Defraud and Mislead)

33. The allegations set forth in this Indictment are incorporated herein by reference and
realleged as though fully set forth herein.

34. Onor about April 1, 2020, in the Central Division of District of Utah and elsewhere,

GORDON HUNTER PEDERSEN,

defendant herein, with the intent to defraud and mislead, introduced and caused the introduction
into interstate commerce of the drugs listed below, namely the silver products Alkaline Structured
Silver Solution Supplement, Natural Structured Silver Mint Mouthwash, Extra Strength Structured
Silver Gel , pH balanced Silver Gel with Aloe Vera, and All Natural Silver Lozenge, that were
misbranded in one or more of the following ways:

(a) within the meaning of 21 U.S.C. § 352(a), in that their labeling was false or
misleading in any particular; specifically, they were labeled as dietary
supplements that could prevent, treat and cure COVID-19;

(b) within the meaning of 21 U.S.C. § 352()(1), in that the labeling of the drugs
failed to bear adequate directions for use under which the layman could use the

drug safely and for the purposes for which it was intended;

(c) within the meaning of 21 U.S.C. §352(0), in that the drugs were not
manufactured, prepared, propagated, compounded or processed in an

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Case 2:20-cr-00216-DBB Document1 Filed 07/23/20 PagelD.11 Page 11 of 12

establishment duly registered under 21 U.S.C. § 360, and were not included in
any list of drugs as required by 21 U.S.C. §360(); and

(d) within the meaning of 21 U.S.C. § 353(b)(4)(A), in that these were prescription

drugs and at no time prior to dispensing did the label of the drugs bear, at a
minimum, the symbol “Rx only.”

| PRODUCT(S) HOW
COUNT | — } INTERSTATE COMMERCE MISBRANDED
4, Alkaline Shipped via USPS First Class Mail from My | 21 U.S.C. §§
Structured Doctor Suggests in American Fork, Utah to | 352(a), 352(f),
Silver Solution | Kansas addressed to an undercover alias used | 352(0),
Supplement by FDA Special Agent Virginia Keys. 353(b)(1), and
353(b)(4)(A)
5, Natural Shipped via USPS First Class Mail from My | 21 U.S.C. §§
Structured Doctor Suggests in American Fork, Utah to | 352(a), 352(f),
Silver Mint Kansas addressed to an undercover alias used | 352(0),
Mouthwash by FDA Special Agent Virginia Keys. 353(b)(1), and
6. Extra Strength | Shipped via USPS First Class Mail from My | 21 U.S.C. §§
Structured Doctor Suggests in American Fork, Utah to 352(a), 352(f),
Silver Gel Kansas addressed to an undercover alias used | 352(0),
by FDA Special Agent Virginia Keys. 353(b)(1), and
353(b)(4)(A)
7. pH balanced Shipped via USPS First Class Mail from My | 21 U.S.C. §§
Silver Gel with | Doctor Suggests in American Fork, Utah to 352(a), 352(f),
Aloe Vera Kansas addressed to an undercover alias used | 352(0),
by FDA Special Agent Virginia Keys. 353(b)(1), and
| 353(b)(4)(A)

Allin violation of 21 U.S.C. §§ 331(a), 333(a)(2); and 18 U.S.C. § 2(b).

NOTICE OF INTENT TO SEEK FORFEITURE

Pursuant to 18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c), upon conviction of any
offense in violation of 18 U.S.C. § 1343, as set forth in this Indictment, the defendant shall forfeit
to the United States of America all property, real or personal, that constitutes or is derived from
proceeds traceable to the scheme to defraud. The property to be forfeited includes, but is not
limited to, the following:

e A MONEY JUDGMENT representing the value of any property, real or personal,
constituting or derived from proceeds traceable to the scheme to defraud.

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SUBSTITUTE ASSETS
If any of the above-described forfeitable property, as a result of any act or omission of the

defendant,

(1) cannot be located upon the exercise of due diligence;

(2) has been transferred or sold to, or deposited with, a third person;

(3) has been placed beyond the jurisdiction of the court;

(4) has been substantially diminished in value; or

(S) has been commingled with other property which cannot be divided without
difficulty; it is the intent of the United States, pursuant to 28 U.S.C. § 2461(c) and 21 U.S.C. §
853(p), to seek forfeiture of any other property of said defendant up to the value of the above-

forfeitable property.

FOREPBRSON OF THE GRAND JURY

JOHN W. HUBER
UNITED STATES ATTORNEY

Assistant United States Attorney

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