As the coronavirus pandemic rages on, local and federal authorities in Dallas have begun cracking down on businesses they say are skirting the law.
The U.S. attorney’s office on Thursday sued a Richardson chiropractor, saying he’s falsely claiming to have a product for sale that can prevent COVID-19 infection.
Dr. Ray Nannis of Optimum Wellness Solutions is charging people $95 per dose for a homeopathic preventive treatment, the lawsuit says. A federal judge on Friday afternoon granted the U.S. attorney’s request for a temporary restraining order to stop him. The government said Nannis is exploiting the pandemic with his “predatory wire fraud scheme.”
And Dallas County sent a cease-and-desist letter to the owner of a smoke shop retail chain earlier this month for failing to close down during the pandemic in violation of a county order affecting nonessential businesses.
The Puff n Stuff Smoke Shop responded with a lawsuit Wednesday against the city and Dallas County, arguing it is an essential business under the bodega category. The stores are known for their glass bongs, tattoo equipment and other “counterculture” paraphernalia. But the owners said they’ve stocked their stores with groceries, toiletries and protective masks to help the community during the outbreak.
Nannis, the chiropractor, also said he’s just trying to help the community. When reached Friday by phone, he said his product will not harm anyone and that he’s made no guarantees. He said he and his family have taken it.
“I’m just trying to help people,” he said on Friday. “If they’re telling me I can’t do it, I’m willing to comply.”
Erin Nealy Cox, the U.S. attorney in Dallas, said preventing fraud during the public health crisis is a top priority for her office.
“As a community, we cannot and will not allow individuals to peddle false hope during this pandemic in order to line their own pockets,” she said in a statement Friday. “By promoting these unsubstantiated ‘treatments’ for COVID-19, this defendant is substituting profits for the safety of the public. We’re determined to put a stop to this egregious conduct.”
Assistant U.S. Attorney Andrew S. Robbins said in the federal lawsuit that Nannis made “numerous false claims on the internet and to prospective customers” about his product.
Facebook claims
Nannis caught the attention of Gabriel Marchal, a U.S. Secret Service agent, who on March 30 read through Optimum Wellness’s public Facebook page. The lawsuit said multiple posts “falsely state that a homeopathic product can prevent, mitigate, or otherwise treat COVID-19 and/or the novel coronavirus.”
One March 19 post described a “Corona-19 Homeopathic Vaccine remedy,” and explained that the virus can be “treated effectively with safe, non-toxic, sublingual Homeopathic and other natural remedies,” the lawsuit said.
Robbins said in the lawsuit that there are no known FDA-approved vaccines or drugs to treat the virus.
Optimum’s Facebook page also said it had homeopathic remedies to “help build immunity against the virus.” In a Facebook video post, Nannis suggested his product could have a “90% protection” rate against COVID-19, according to the lawsuit.
In an April 1 Facebook post, Nannis said his homeopathy could still help even if it doesn’t prevent the disease, the lawsuit says. “If you do get sick, it’s going to make it very, very, very minimal,” Nannis said in the video.
When the agent called Nannis about his product, the chiropractor offered to sell it to Marchal for $95 per dose, the lawsuit said. He also offered to ship the homeopathy to Marchal if he provided his credit card information.
“As of April 14, 2020, agents have observed consumers patronizing defendants’ Richardson location, indicating that the scheme is ongoing,” the lawsuit said.
Nannis told The Dallas Morning News on Friday that he hadn’t seen the lawsuit yet. He said he obtained his product from one of his mentors but has not sold much of it. Nannis said misinformation about the virus is rampant online and in the media but that he is not part of the problem.
“I’m just sad that this is what they’re worrying about at this moment,” he said about the U.S. attorney’s action.
Nannis said his treatment is a liquid that you hold under your tongue for a few seconds. He said he advises people to take it three times a day for up to three weeks. “I’m certainly not going to get rich off it,” he said.
Bodegas?
Puff n Stuff Smoke Shop says on its website that it’s “often dubbed the ‘Counter Culture Super Store.’”
But in its lawsuit against the city and county, Puff n Stuff said its stores have always acted as one-stop shops “geared toward a ‘hip’ generation of customers.” Tobacco and Wine Inc., owner of the four stores, three of which are in Dallas, said in the lawsuit that nearly half of its combined sales involved groceries and dietary supplements.
The chain is owned by Sylvia Gabbay and her husband, according to the lawsuit. The lawsuit, which seeks a restraining order against the city and county, was filed in Dallas County district court. But the city and county are seeking to transfer it to federal court, on the grounds that the owners are claiming a violation of their constitutional rights.
Tobacco and Wine said it began stocking up on grocery items at the beginning of the year as news spread of the coronavirus outbreak. The company said it is providing its customers with an “invaluable service.” In March, the company ordered large numbers of “3-ply face masks,” which began arriving in early April, according to the lawsuit, filed by attorney Ernest Leonard.
In late March, Dallas code enforcement officers began showing up at its stores to issue code violations and to inform them they had to close, the lawsuit said. And the county sent its cease-and-desist letter on April 8. The letter, signed by Dallas County Judge Clay Jenkins, said it did not appear that Puff n Stuff Smoke Shop met the criteria outlined in his “safer at home” order.
The letter, sent “via hand delivery,” threatened criminal prosecution for noncompliance, according to the lawsuit.
Jenkins does not comment on pending lawsuits, his spokeswoman said. The mayor’s spokesman also said there would be no comment due to the litigation. The attorney representing the city could not be reached for comment.
An affidavit included with the lawsuit referenced a Jenkins tweet on April 2: “Do you know of any smoke shop, craft store, or other nonessential business … ignoring my #SaferAtHome order and putting profits over public health in your area? Report on DallasCountyCovid.com so we can shut them down ASAP.”
Puff n Stuff’s owner said its stores can be described as bodegas defined as a “small grocery store in an urban area.” The stores sell snacks, drinks, dietary supplements and other food as well as laundry and kitchen goods, the lawsuit said. The stores are also selling the protective face masks “only slightly above cost.”
By remaining open during the pandemic, the stores are helping people who live within walking distance and who would rather avoid larger stores due to the risk of exposure, the lawsuit said.
The company said it would lose 95% of its income and have to lay off its employees if its stores were forced to close.
In the city’s response, filed on Thursday, Assistant City Attorney Charles Estee wrote that Puff n Stuff “continues to hold itself out as smoke shop,” and thus is not an essential business. Trying to sell essential goods after the shelter-in-place order was issued would defeat the purpose of that order, he wrote.
“If that were the case, every business in Dallas could do the same and start reopening, rendering the shelter-in-place orders meaningless,” Estee said in the filing.
This story was updated to include the city’s response to the Puff n Stuff lawsuit as well as the federal judge’s granting of the government’s request for a restraining order.
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