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Kan. store owner admits trafficking in fake goods

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  • Kan. store owner admits trafficking in fake goods

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    Kan. store owner admits trafficking in fake goods
    Kansas store owner pleads guilty to trafficking in counterfeit luxury goods
    By Roxana Hegeman, Associated Press
    23 hours ago
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    WICHITA, Kan. (AP) -- A Wichita store owner has admitted to trafficking in fake luxury items bearing designer labels such as Prada and Chanel.
    Glenda Sue Morgan pleaded guilty Tuesday in federal court in Wichita to one count of trafficking in goods bearing counterfeit trademarks.
    Morgan and her business, The Fabulous Store LLC, were indicted in April on charges of conspiracy and trafficking. In exchange for Morgan's plea, prosecutors agreed to drop at sentencing the remaining charges against her and dismiss the indictment against the store.
    Prosecutors allege Morgan, 55, sold handbags, wallets, sunglasses and jewelry bearing trademark designs and brand names that were not made by the companies.
    Morgan's defense attorney, Sylvia Penner, did not immediately respond to a voice message left at her office or to an email from The Associated Press.
    In April, two undercover agents bought about $500 worth of items at the store, including a fake Chanel bracelet and sunglasses, a pair of counterfeit Ugg boots as well as several purses bearing the counterfeited trademarks of Michael Kors, Coach, Luis Vuitton and Prada.
    Investigators raided the store nearly two weeks later, seizing 400 replica items with a retail value of $14,000, according to a court document. The goods would have been worth $140,000 had the trademarks been genuine.
    The store's business practices first came to light in 2009 after a postal carrier assigned to the store's route told the Department of Homeland Security the shop received about six to seven packages a month from China, according to a DHS affidavit. Agents eventually seized nearly 2,600 items that would have been valued at about $1.5 million had they been authentic.
    Federal agents went to Morgan's Andover home in January 2011 and informed her of federal laws prohibiting the sale of counterfeit merchandise, according to the affidavit. At that time, Morgan agreed to abandon the seized items and was not charged.
    But in March, agents acted on a tip that Morgan had resumed selling counterfeit goods, launching an undercover operation that led to the current federal indictment.
    Sentencing is Jan. 17.
    Morgan faces a fine of up to $2 million and up to 10 years imprisonment, although she is likely to receive far less, if any, prison time under federal sentencing guidelines. Prosecutors agreed in the plea deal to recommend a sentence at the low end of the guideline range, including a low-end monetary fine.
    Her legal troubles will not be fully resolved with the end of the criminal case, however.
    Coach filed a separate suit in May against the store, its owner and an employee for allegedly selling phony items bearing its brand name. That civil case is pending.
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