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Tom Olsen, Forum News Service, Published September 23 2013

Duluth head shop employees say they knew customers were getting high off products

MINNEAPOLIS — A former defendant in the Last Place on Earth federal drug case took the stand Monday and told the court that he still believes he never did anything illegal.

Jamie Anderson, 25, worked at the downtown Duluth head shop for three years and was indicted on four federal felonies before pleading guilty to a single misdemeanor conspiracy count in April as part of a plea bargain with prosecutors.

“I was thinking about my family,” said Anderson, who has a girlfriend and two children. “With the counts I had, I was thinking I’d be doing a lot of time in jail.”

Anderson has not yet been sentenced, but faces up to one year in jail, with a guideline sentence of 0-6 months. The agreement stipulated that he must testify in the trial of the three remaining defendants.

Shop owner Jim Carlson, 56, is charged in U.S. District Court in Minneapolis with 55 counts for allegedly distributing controlled substances and violating federal labeling laws. His son, Joseph Gellerman, 35, and girlfriend, Lava Haugen, 32, both former shop employees, are charged with four counts apiece.

Anderson testified that Carlson gave his employees instructions on how to sell the products that he called “spice” or “incense.” They would not tell anyone that it was for smoking and would not sell to anyone who made an illegal reference — that is, said they intended to smoke it or use it for any other purpose that might be illegal.

Still, employees knew that customers were smoking the products, he said.

“I told (Carlson) we were having customers say they were getting high off of smoking it,” he said. “He seemed pretty happy about it.”

Anderson said even he was open about smoking the products — once allowing a local television station to film him smoking outside the store.

On cross examination from defense attorneys, Anderson said he was so open about smoking the products because he always believed it was legal to do so.

“(Carlson) would stop selling products that would become illegal,” he said.

Former store employee Andrew Keuten also testified, telling prosecutors that he had used products he called “fake weed” from the Last Place on Earth for several years before getting a job there in January 2012. He said he was on probation and needed to submit to drug testing, so he was looking for an alternative that was legal and would not be detectable in his system.

“It was like a hard drug — like meth or heroin,” he said. “Sometimes it would make me wake up; sometimes it would make me pass out. It wasn’t very consistent.”

Defense attorneys contended that the government turned a blind eye to Keuten’s own illegal drug sales outside the store in order to nab the Last Place on Earth. Keuten testified that he told investigators that he was selling marijuana on the streets to make money.

“They didn’t care about you selling illegal drugs on the streets of Duluth?” Carlson’s attorney, Randall Tigue, asked Keuten.

“No,” he replied.

Testimony Monday concluded with Federal Drug Administration Special Agent Ken Kulick taking the stand. Kulick, who has worked on the case, was shown images of some of the store’s products and testified that he noticed many violations of FDA regulations.

Some products had little or no labeling, he said, and often contained the phrase “not for human consumption,” even though they were intended to be ingested. Additionally, most products failed to include a complete list of ingredients, he said.

The government is attempting to show that the store employees deliberately misbranded products, but defense attorneys say manufacturers did the labeling.

Defense attorneys will have the opportunity to cross examine Kulick Tuesday morning. The prosecution is also expected to call some of the distributors of the products, as well as several former Last Place on Earth customers, who will testify about the effects of synthetic drugs.

The government’s case appears to be coming to a close, with expert witnesses likely taking the stand Wednesday to testify about the chemical compounds contained in the products.