A federal grand jury in Sacramento has indicted three people, including two Elk Grove residents, for trafficking in counterfeit DVDs.
The 23-count indictment charges Kristin Caldwell, 30, and William Brown, 28, both of Elk Grove, and Xavier Johnson, 31, formerly of Elk Grove, with wire fraud and trafficking in counterfeit goods, according to a federal Department of Justice news release.
According to the indictment, from 2008 to 2011, the defendants imported DVDs containing counterfeit copies of children's movies and marketed them over the Internet. The three are alleged to have falsely advertised that they had located a limited supply of scarce Disney DVDs that were otherwise unavailable for purchase. They are accused of importing thousands of bootleg copies of the movies directly from factories in China and selling them as if they were legitimate DVD's.
The defendants allegedly had their Chinese partners ship the DVDs to numerous acquaintances to avoid detection by U.S. Customs and used friends and acquaintances to wire money to China to pay for the goods. The counterfeit DVDs were shipped to customers from a residence in Elk Grove and a facility in Cincinnati, Ohio.
Caldwell and Brown were arrested July 13 in Elk Grove and appeared before U.S. Magistrate Judge Kendall J. Newman, where they both pleaded not guilty. They were released on bond and are to appear before U.S. District Judge Kimberly J. Mueller on Wednesday.
Johnson was arrested Friday in Riverdale, Ga., and appeared in the U.S. District Court for the Northern District of Georgia. He was ordered detained without bail and is to be transported to Sacramento by the U.S. Marshal Service to answer the charges.
The case is the result of an investigation by the United States Postal Inspection Service and the Federal Bureau of Investigation.