Botox substitute scam costs doctor everything

If he wasn't down to his last $600, if he hadn't lost his $1.2 million-dollar house on a golf course, if his Corvette hadn't been repossessed, if he hadn't been convicted of a felony, if he hadn't lost his medical license, if he wasn't going through a divorce, if he didn't have to go to prison, then, Stephen Seldon said, his life would be more enjoyable.

The former Las Vegas doctor, convicted last year of what federal authorities said was a fake Botox scheme, sat in the Pei Wei Asian Diner in Summerlin on Thursday talking as physicians often do, with a presence suggesting he had everything under control.

And yet what he spoke so authoritatively about is why he believes his life had spun out of control.

"First of all, the government wanted to make an example out of me," Seldon said between sips of beer.

And the hepatitis outbreak that was announced months before his trial "made people hate doctors." That, he said, prejudiced jurors against him.

One juror actually told him after the trial that such a mindset existed among jurors who found him guilty, he said.

As Seldon spoke, he looked at his watch.

In less than 24 hours, "Friday at noon," Seldon said, he would report to Terminal Island, a federal prison in Los Angeles that has housed the likes of Al Capone and Charles Manson.

"A former patient said it would be an honor to drive me. They told me all I had to bring was a new pair of tennis shoes," Seldon said between bites of fried rice.

A prison spokeswoman at the low-security facility confirmed Friday that Seldon is now behind bars.

Seldon, well under 6 feet with a decided paunch, said he has heard stories about violence in prison settings, but he isn't worried.

"I can take care of myself," he said, running his hand through his thinning hair. "I played football."

In March, the 54-year-old Seldon was sentenced to 46 months in prison by U.S. District Judge Kent Dawson.

That followed his November 2008 fraud conviction for purchasing and using a drug unapproved by the FDA for the treatment of wrinkles.

Botox, used both for wrinkles and excessive perspiration, is the brand name of a drug derived from Botulinum Neurotoxin Type A, a highly potent toxin.

Seldon's 41-year-old wife, Deborah Martinez Seldon, his office manager, received a 30-month sentence, which she will serve in Minnesota.

The former millionaires were convicted on 14 counts of mail fraud -- that was how the product was ordered -- and one count of adulterating a drug while held for sale. They were also fined $144,000.

At trial, the federal government made the case that patients at the Seldons' Las Vegas clinic, "A New You Medical Aesthetics," thought they were receiving Botox but instead were injected with a Botulinum product called TRItox which is sold by Toxin Research International.

TRItox was sold in vials labeled, "For research purposes only, not for human use."

Government attorneys pointed out that in 2004 four individuals in Florida contracted botulism, a paralytic illness, after receiving research grade Botulinum toxin from Toxin Research International, an Arizona company.

One of the principal owners of that firm, Chad Livdahl, was convicted of illegally selling $2 million worth of TRItox to physicians across the country.

Livdahl was brought out of prison to testify for the government.

Clad in a striped jail uniform, Livdahl testified that he sold the Seldons the drug and that when federal authorities began to investigate him, he and his brother assisted the Seldons in erasing data from their office computer.

While at the restaurant Thursday, Seldon said he and 200 doctors around the country purchased the product from Livdahl only because Livdahl had said it was close to FDA approval as a cheaper version of Botox.

But at the couple's trial, Livdahl said he never told doctors that his drug was on the verge of being approved.

"He was a liar just trying to get time chopped off his sentence," Seldon said Thursday. "I never even treated patients with his drug."

During the trial, Assistant U.S. Attorney Crane Pomerantz produced evidence that, during a one-year period ending in October 2004, the Seldons purchased 19,000 units of TRItox for $36,925, half the cost of Botox.

"If I had driven to Arizona to purchase it instead of using the mail, there wouldn't have been any mail fraud," Seldon said.

But in the interview Seldon was unable to explain why he would have purchased so much of the drug if he didn't use it.

"No patients ever came forward during the trial to complain," Seldon said.

"The only reason why those people in Florida had trouble is that the doctor gave them far too much of it. That's like comparing my giving two aspirin to a patient to another doctor giving someone 2,000 aspirins to a patient. It made no sense."

Seldon is convinced that representatives of Allergan, then the only company allowed to market a drug from Botulinum, became irate when he gave a talk to other doctors on what the virtues of TRItox would be when it was approved by the FDA. He claimed the Allergan representatives went to federal authorities to complain.

U.S. Attorney Greg Brower said Thursday the government acted against Seldon only after learning he was illegally using a dangerous drug.

As far as Seldon's claim that the government was "making an example" of him, Brower said it's hoped every prosecution and conviction helps deter people from crime.

"It only took a jury 21/2 hours to convict him," Brower said.

Seldon, who trained to become an eye, ear, nose and throat specialist while in the Navy, said he went into medicine at the urging of his parents, who both were Lutheran missionaries.

"They were sure I could do good there," said Seldon, who grew up in California.

After his sister died at the age of 3, Seldon said he began to have dreams of someone trying to help his sister.

"I was 7 years old when she died, and I had those dreams for years," he said. "Later when I got help working through those dreams, I realized I was the one I saw trying to help her. So I decided to become a doctor."

He moved to Nevada in the 1990s and was quickly successful. About four years ago, he purchased a home for more than $1 million in The Grand Legacy community in Henderson.

His two adult sons from a previous marriage live in California. He had shared custody of a teenage daughter by a previous marriage who now lives with her mother in Nevada.

Only when he spoke of his daughter did Seldon display emotion about his situation.

"I'm going to miss her," he said, tears welling in his eyes.

"I'll admit it. I loved the stature and the money I got from being a doctor. But I also loved my patients. I was never greedy."

He moved into the lucrative trade of cosmetic medicine, including performing face-lifts, only because he didn't "have to deal with insurance companies."

Insurance companies don't cover cosmetic procedures, so patients pay in cash or with credit cards.

Soon he was making more than $800,000 a year.

"I don't apologize for making money," Seldon said.

He is frustrated that a jury didn't believe him when he testified that he didn't do anything wrong. But he is confident his appeal will be successful.

"The truth is, I should have never been prosecuted," Seldon said. "I should have just got a fine like other doctors get when they don't hurt anybody. I didn't hurt anybody. Somebody around here really doesn't like me."

Contact reporter Paul Harasim at pharasim @reviewjournal.com or 702-387-2908.