MINNEAPOLIS - Jim Carlson, owner of downtown Duluth’s Last Place on Earth head shop, was sentenced to 17 ½ years in federal prison Thursday in a ruling that left government officials jubilant and Carlson’s supporters fuming.
While the likes of U.S. Senator Amy Klobuchar were declaring U.S. District Judge David S. Doty’s ruling a victory in the nationwide struggle against synthetic drugs, Carlson’s attorney was openly lambasting Doty’s judgment and the federal government’s efforts to put Carlson behind bars.
“This prosecution is a far greater threat to America than anything Jim Carlson had done,” attorney Randall Tigue said outside the courthouse, adding that an appeal would be filed by Monday.
But police, prosecutors and politicians said the stiff sentence sends a message to the many people who continue to sell synthetic drugs under the guise of legality.
“This case should confirm, once and for all, that synthetic drugs are illegal,” lead prosecutor Surya Saxena said. “They always have been illegal. There simply are no legal loopholes that authorize the distribution of designer drugs that mimic controlled substances. Most importantly, I hope that this prosecution demonstrates that it is simply not safe to take synthetic drugs.”
The federal government had asked Doty to sentence Carlson to a minimum of 20 years in prison. Tigue had argued for three years or less.
Also sentenced Thursday was Carlson’s ex-girlfriend, Lava Haugen, who worked for Carlson at the shop. Doty sentenced her to five years in prison.
Given an opportunity to speak before sentencing, Carlson, wearing an orange jail jumpsuit and sporting long hair and a thick beard, had a question for Doty: “How long do I have?”
Given no time limit by the judge, Carlson gave a lengthy statement, criticizing the prosecution and drug laws, again asserting that the government made him believe at all times that his conduct was legal. He repeatedly stated that he was specifically targeted by the federal government, claiming that between 500 and 1,000 other stores in Minnesota were selling the same products and were not subject to criminal proceedings.
“All over the place, not a person got bothered but me and my family,” he told the judge. “I was always told that laws are applied equally. I cannot see how this is equal.”
Saxena argued that Carlson had ample warning that his products were illegal and dangerous. He said Carlson was well aware of the public health and public safety effects his products were having on the downtown Duluth community, but continued to sell them anyway because he was motivated by money.
“Mr. Carlson has no remorse,” Saxena told the judge. “Despite the fact that he sold these dangerous products, he has never accepted any responsibility.”
Doty issued the sentence with little additional commentary, simply noting that he had taken all of the trial testimony and arguments into consideration. In addition to the prison time, Carlson will serve three years of supervised release after his prison term is completed, and will pay a $25,000 fine.
Klobuchar, who has introduced legislation in Congress that would create tougher synthetic drug laws, issued a statement shortly after the hearing.
“Today’s action sends a strong message about our commitment to cracking down on synthetic drugs and the people who push them,” she said. “Synthetic drugs are tearing families apart and claiming young peoples’ lives in Minnesota and across the country.”
Her response echoed similar statements from local law enforcement officials, the Drug Enforcement Administration, the U.S. Food and Drug Administration and the Internal Revenue Service.
Duluth Police Chief Gordon Ramsay said the sentence brought cheers to his department and that it seemed appropriate even if police had hoped Carlson would get 20 years or more.
“The cumulative impact of all the hard work paid off… we’re satisfied with that,’’ Ramsay said of the sentence.
Duluth became a national focal point in the fledgling effort to control the distribution of an essentially new drug, and Ramsay praised the patience of the city’s residents, political and business leaders as the department slowly worked through the ordeal.
“I appreciate everyone’s patience with us… but we built a very, very strong case,’’ Ramsay said, adding the issue was taxing the entire community and especially his department. Carlson and the Last Place on Earth “became a major distraction for everything we did.”
With the sentencing, a forfeiture order of approximately $6.5 million was finalized, allowing the government to seize money from Carlson’s bank accounts and various other properties, including the store.
Carlson was critical of the forfeiture order, saying it requires him to give up money he had worked for since he was a child. He said he has essentially already lost most of the $6.5 million he was estimated to have made from synthetics sales. Carlson said he spent about $2.5 million to buy the products, $2 million in taxes, $500,000 for court-ordered police protection around his store, and so far has paid about $1 million in attorney’s fees.
Duluth will get to see a portion of the roughly $8 million that the government seized in Carlson’s and Last Place on Earth cash and property, Ramsay said. “Probably about $1 million,’’ the chief noted, adding, however that it could take years to get a check cut as appeals are likely. Duluth would be required to spend the money on law enforcement or drug prevention related activities, he noted.
Doty’s ruling came Thursday afternoon following a 3 ½-hour evidentiary hearing in which attorneys and expert witnesses debated the method used by probation agents to calculate sentencing guidelines for Carlson and Haugen. Because synthetic products are relatively new to the United States and are not built into the federal court system’s sentencing guidelines, equivalency ratios were used to convert the mass of his products to more traditional drugs.
Doty accepted the government’s recommendations, which calculate the mass of synthetic cannabinoids - Carlson’s most popular product - at a ratio of 1:167. That calculation made him responsible for selling the equivalent of 222,286 grams of marijuana.
Following the verdict, Tigue said he was disappointed, but not surprised by the judge’s rulings. He said Carlson has good reason to feel optimistic about the circuit court appeal.
“Judge Doty made so many errors in this trial, I can’t see an appellate court not reversing him on something,” Tigue said.
Carlson closed his statement to the judge by asking for leniency for Haugen. He informed the judge that the two had decided to break up, but said she doesn’t deserve to be put in prison.
“I hope you don’t do nothing to her,” Carlson said, crying.
Moments later, Doty sentenced her to five years. The government argued for at least 10 years; the defense had sought probation.
Haugen also gave an emotional statement to the court, saying she deeply regretted her involvement with Carlson and the store.
“My whole relationship with Jim, he had me thinking that what he was doing was legal, even though I knew deep down that it was wrong,” she said.
At the urging of defense attorneys and the agreement of prosecutors, Doty allowed Haugen to remain free for the time being due to medical issues. She was given 30 days in which to voluntarily surrender.
Doty said he would recommend to the Bureau of Prisons that both Carlson and Haugen be allowed to serve their prison time at facilities that offer medical services. Carlson has health issues related to gastric bypass surgery and Haugen suffers from multiple sclerosis and fibromyalgia.
The case’s final defendant, Carlson’s son Joseph Gellerman, attended the hearing, but was not sentenced. No date has been set for him, but that could happen within a month.
News Tribune staff writer John Myers contributed to this report.