Nike Counterfeit Shoe Probe Targets Oregon Man

"Fake."

"You guys sent me a fake pair of shoes and I would like my money refunded."

"It's clearly a fake."

"The shoes are so fake so I am asking for a refund."

These are just some of the comments left on the EBay site where James Pepion allegedly sold what he claimed are authentic Nike shoes, according to an agent with the Department of Homeland Security in an affidavit filed in Federal Court in Portland last week.

It's part of an investigation into the "illicit sale of stolen, counterfeit and grey-market (i.e. products assembled from authentic, potentially stolen components outside of authorized Nike factories) Nike and Jordan shoes, including stolen Nike samples and unauthorized pre-releases," according to the agent, Trina Ledbetter.

According to the affidavit, Ledbetter was asking a federal judge for a warrant to search Pepion's home.

Federal officials became involved after receiving information from Nike in March 2015 after the company had conducted a "discrete" investigation into the website Get-Supplied.com.

Nike told the Feds that Pepion operated Get-Supplied.com out of his home in Happy Valley, oregon and that he used swagsupply20l2@gmail.com in the operation of his business via eBay and PayPal.

Ledbetter writes that additional research disclosed that "Pepion had one seizure by Customs and Border Protection (CBP) at the Fedex facility in Anchorage, Alaska, on October 30, 2013. The shipment contained 10 pair of shoes bearing Nike trademarks. CBP officers determined they were counterfeit due to poor quality, packaging, and declared value."

According to the affidavit, which was first reported by KOIN.com, Ledbetter writes she was able to track nearly 100 shipments to Pepion from 2009 to 2015 from Hong Kong and China.

Based on what had been learned, 17 more border searches were conducted on shipments "intended for Pepion and his associates, including his girlfriend, Ella Reider, at various addresses.

"All of the shipments were counterfeit except one."

After one seizure, Ledbetter writes, sent photos of some of the shoes to a Brand Protection Manager at Nike "who indicated that the shoes were counterfeit."

Ledbetter indicates that she also received information from EBay about accounts maintained by Pepion.

One account had sold 71 items - including Nike Jordan infrared and Air Jordan Retros - for $16,713.80.

Another account had conducted sales of approximately items that "appear to be sneakers" worth $101,229.00

Ledbetter also received information from PayPal for an account maintained by Pepion, according to the affidavit.

That account received 9,418 payments between January 2012 and March, 2015 totaling - after fees - $2,565,982.73.

In August 2015, Nike told Ledbetter that they were receiving "complaints that James Pepion (was) selling counterfeit merchandise."

One email Nike received is included in the court papers.

"Subject: Online website in Portland selling fake shoes.

"Hello, Like many others in the shoe community, a lot of us are disappointed in Nike's lack of action against counterfeit sneaker sellers. There is a company based out of Portland shelling out a lot of fakes to many unknowing buyers. What this does is cause more headaches because people are double-checking and triple-checking their shoes. Seeing how Nike is based out of Oregon, it's troubling to see Nike not take action. I'm sure by now you have heard of Supplied PDX, or Swagsupply, or Get-Supplied. They're all the same company and run by the same group of crooks."

The probe continued with Nike and Federal investigators making purchases from Pepion's site of sneakers that turned out to be counterfeit.

Ledbetter writes that investigators were able to link Pepion to a man in China "who is suspected of theft of samples and components from Nike manufacturing partner facilities in China and the organized sale of stolen samples and counterfeit Nike and Air Jordan shoes."

The search on Pepion's home was conducted on the morning of April 6.

Agents seized, among other items, more than 1,500 pairs of Nikes, 40 pairs of Adidas, two iPhones, seven boxes of documents, and iMac.

Attempts to reach Pepion, who has not been charged, were not successful.

Several phone numbers listed in the affidavit went right to voice mail or appear to have been disconnected. His website, Instagram account, and Twitter account, all appear to be down.

The problem of counterfeit items on the market is such a big problem that Nike has devoted a section of its website to educate people about what to do if they find fake merchandise.