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Multnomah County prosecutors have employed a novel tactic in the past three months to increase the criminal penalties for drug traffickers who push fentanyl on Portland’s streets. They are charging dealers with counterfeiting the trademark of a pharmaceutical company that helped spark the nation’s opioid crisis.
In other words, prosecutors say, when dealers sell powdered fentanyl in a blue pill stamped with “M30,” they are infringing on the trademark of Mallinckrodt Pharmaceuticals, long one of America’s largest painkiller manufacturers.
At least eight defendants now face charges of trademark counterfeiting, a felony that alone can carry a penalty of up to 10 years in prison. None of the defendants has yet pleaded guilty, and no case has made it to trial.
The idea, which harks back to the feds indicting Al Capone for tax evasion in 1931, was the brainchild of a line prosecutor named Cody Linderholm. He’s adamant that the extra charges are warranted, noting the extent to which fentanyl has fueled Portland’s rise in homelessness and property crime.
“I’m trying to find ethical ways to proactively prosecute,” Linderholm says.
The idea came to Linderholm as he prepared to fly to Chicago in December for a professional conference on counterfeiting.
In Oregon, like nearly everywhere else in the country, “trademark counterfeiting” is illegal under state law. In the past, Multnomah County prosecutors have used it to go after music pirates and sellers of knockoff luxury handbags.
But those cases aren’t common. In fact, until this January, no one had been charged under Oregon’s most serious criminal counterfeiting statute for several years. With a skyrocketing murder rate, the Multnomah County District Attorney’s Office had bigger fish to fry.
Linderholm, a deputy DA assigned to drug and property crimes, wasn’t familiar with the details of Oregon’s counterfeiting statute. He hadn’t had much opportunity to use it. Prada knockoffs weren’t showing up in the police reports crossing his desk.
What was, however, was fentanyl.
The pills, known on the streets as “M30s” or “blues,” have flooded Portland streets, and Linderholm was being assigned a steady flow of cases involving suspected dealers. It occurred to him that the distinctively designed pills might be trademarked. So he pulled up the United States trademark database on his computer and punched in “M30.”
Nothing. Undeterred, he removed the dosage and queried simply “M.”
Bingo.
The trademark that popped up on Linderholm’s computer screen was filed in 1999 by Mallinckrodt Pharmaceuticals. Mallinckrodt was founded in St. Louis more than a century and a half ago, joined the Fortune 500 in the 1980s, and by 2019 had $3.2 billion in annual revenue.
For years, Mallinckrodt sold the opioid oxycodone under the brand name Roxicodone, a 30-milligram blue pill with a distinctive trademark: a square containing the letter M.
That pill helped fuel the opioid epidemic. In 2019, The Washington Post revealed that Mallinckrodt had distributed nearly 30 billion of its opioid pills across the United States—80 for each and every person in the country.
The yearly number of overdose deaths nationwide from opioids has doubled three times since 1999, an epidemic that the U.S. Centers of Disease Control and Prevention says now takes more than 70,000 lives every year.
Mallinckrodt recently reached a $1.6 billion settlement in a nationwide lawsuit alleging its aggressive marketing of opioids fueled an epidemic of addiction. (Multnomah County sued the company in 2017.)
The company filed for bankruptcy in 2020. Meanwhile, illicit drug dealers have flooded the market with knockoffs of the blue pills, replacing the oxycodone with the cheaper, more powerful fentanyl.
Because fentanyl looks so similar to more familiar drugs (oxycodone when sold as pills and cocaine when sold as a powder), it is very easy for an unsuspecting user to overdose. “The kid at the party—or whomever is the purchaser—really doesn’t know what they’re getting,” Linderholm says.
So he’s begun charging the dealers with trademark counterfeiting.
There’s an irony here. Five years ago, Multnomah County was suing Mallinckrodt. Now, the county’s prosecutors are defending the company’s trademarks.
To understand why, take a stroll downtown.
On a stool in the cafeteria of Blanchet House in Old Town, a 44-year-old lifelong heroin addict told WW he ended up in the hospital after inhaling a few hits of fentanyl last week. It took four doses of the overdose-reversal drug Narcan to revive him.
In Oregon, 280 people died from opioid overdoses in 2019. Two years later, the death toll was 745. And the victims aren’t just longtime addicts.
In 2020, two teenagers at Northeast Portland’s McDaniel High School died from fentanyl overdoses within 24 hours. Their parents say the kids believed they were taking prescription opioids. Police say they were counterfeit pills laced with fentanyl, nearly identical in appearance to Mallinckrodt’s Roxicodone.
Last month, the drug took the life of another Portland teenager, this time a student at Franklin High School. Sgt. Danny DiPietro of the Washington County Sheriff’s Office now tells parents to keep a dose of Narcan handy at home.
Police trace the fentanyl supply to armed pill dealers now roaming the streets of Portland.
On Feb. 20, Ramos Valle led Portland police on a foot chase after they attempted to stop him near the open-air drug market at Southwest 4th Avenue and Washington Street (“Market Forces”, WW, March 22).
Valle tossed a gun and ran before being tackled by officers four blocks east. The gun was a loaded .38 Special. In his backpack were nearly 4,000 blue pills, each marked with a square containing the letter M.
Linderholm was assigned the case. The probable cause affidavit makes no mention of Valle actually selling the pills. So Linderholm charged him with, among other crimes, attempted delivery and first-degree trademark counterfeiting.
News of Linderholm’s tactic spread quickly around the office. District Attorney Mike Schmidt nodded his approval. More prosecutors followed suit.
On March 2, cops knocked on the door of a suspected drug house in the South Tabor neighborhood of Southeast Portland.
Michael Savignon and his roommates were at home. One pointed police to the gun that “lived in the kitchen.” Police found 45,000 pills, an AR-15, a .380-caliber rifle, and four pistols. Savignon was arrested and charged with, among other things, trademark counterfeiting.
The charge has been used in at least a dozen cases, stretching back to a Jan. 3 arrest of a man seen selling pills at the Taco Bell on Southeast Stark Street at 185th Avenue.
Five of those, including Savignon’s, were felonies in the first degree. It was the first time that level of counterfeiting charge had been used since 2007.
In March, Valle failed to appear in court. A civil forfeiture order was filed for the $499 seized from his backpack, and a warrant is now out for Valle’s arrest. Savignon remains in jail, and his case has been handed over to federal prosecutors.
Not everyone was enthusiastic when WW asked around about Linderholm’s new tactic.
“In most cases, severity of sanctions does not shift behaviors,” says Bryce Pardo, a policy researcher who has studied U.S. drug law extensively and now works for the United Nations in Vienna. “We went down this road with crack some 30 years ago.” he wrote in an email to WW.
Kevin Sonoff, spokesman for the U.S. Attorney’s Office, says federal prosecutors in Oregon aren’t using it. “We prosecute fentanyl dealers as drug traffickers, not as counterfeiters,” he says.
Still, while prosecuting street dealers for counterfeiting may be novel in Portland, it’s certainly not the first time drug sellers have been charged with violating trademark laws.
Michigan State University’s Center for Anti-Counterfeiting and Product Protection keeps a database of product counterfeiting convictions. (A-CAPP ran the training Linderholm attended in December.) A recent study of that database found 16.7% of convicted counterfeiters had also been charged with drug-related offenses, primarily drug trafficking.
Kari Kammel, the center’s director, says the rise of e-commerce has focused more attention on counterfeiting. “Prosecutors need to use every tool they have in their toolbox,” she adds.
The extra charge doesn’t necessarily translate to more prison time in Multnomah County. It’s generally tacked on to more serious drug distribution charges, which carry stiffer sentences than property crimes.
Still, it can be used as leverage when negotiating plea deals, or as evidence of dishonesty during a future prosecution, Linderholm says. And a judge could consider it an aggravating factor during sentencing.
Linderholm says it helps demonstrate that the Multnomah County prosecutors are taking Portland’s fentanyl problem seriously. “We’re being creative,” he says, “and trying to come up with solutions.”
Correction: An earlier version of this story incorrectly stated that dealers were being accused of infringing on a copyright. It is a trademark.