Bodybuilding.com reaches deal with prosecutors
From USA TODAY
BOISE, Idaho (WTW) — Federal prosecutors reached a plea agreement with an Idaho-based online fitness supplement company and its former president on charges the company sold misbranded drugs, the U.S. Attorney's office said.
The plea agreements with the Meridian-based company, Bodybuilding.com, and its former president Jeremy DeLuca, are still subject to a judge's approval. A hearing has been scheduled for May 24 in U.S. District Court.
The company has agreed to pay a $7 million fine, while DeLuca has agreed to pay a $600,000 penalty, said U.S. Attorney Wendy Olson in a statement. Prosecutors agreed not to seek prison time for DeLuca, under the settlement announced Wednesday.
DeLuca and the company were charged with misdemeanors for violating the Food, Drug and Cosmetic Act. Investigators say the company sold products listed as dietary supplements that were actually classified as drugs by the Food and Drug Administration.
"Industry-leading regulatory compliance and world-class customer service continue to be top priorities for the company," the company said.
DeLuca and his attorney, Scott McKay of Boise, declined to further comment on the case.
In a separate case, DeLuca's brother, company CEO Ryan DeLuca, agreed to pay a $500,000 fine when pleading guilty in April to illegally selling misbranded dietary supplements that contained steroids, as part of an agreement with federal prosecutors.
Ryan DeLuca, 34, acknowledged the five products — I Force Methadrol, Nutra Costal D-Stianozol, I Force Dymethazine, Rage RV5 and Genetic Edge Technologies SUS500 — were drugs sold improperly under the label of "dietary supplements."
The company generated $1.8 million through the first seven and a half months of 2009 from the falsely labeled products and other similar substances, according to court records. The raid on the Bodybuilding.com's headquarters in 2009 followed a two-year investigation that involved a special agent for the FDA buying 23 products from the company that tested positive for anabolic steroids.
Many of the products were neither safe nor legal and by selling them, the company was "misleading, defrauding and endangering its customers," according to the agent. The FDA cited reports that men between 22 and 55 who had used such products have suffered liver problems, stroke, kidney failure and blockage of an artery in the lung, called a pulmonary embolism.
Bodybuilding.com was started in the mid-1990s shortly after DeLuca's brother, company CEO Ryan DeLuca, purchased the website domain. Liberty Media, the Colorado-based owner of the QVC home-shopping cable network, purchased an 83 percent stake in the bodybuilding company in 2008.
The business is now part of Liberty Interactive, which was split off from Liberty Media last year, the Idaho Statesman reports.