UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

 

JOHNSON & JOHNSON, ETHICON, INC., 

ETHICON US, LLC, and JOHNSON & 

JOHNSON HEALTH CARE SYSTEMS, INC., 

Plaintiffs, 

v. 

ADVANCED INVENTORY MANAGEMENT, 

INC. d/b/a ESUTURES.COM, ANTHONY 

IADEROSA JR., JASON EINHORN, MIKE 

PHIPPS, and MUDASSAR SHAH, 

Defendants. 

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Case No. 20-cv-3471 

Judge Robert M. Dow, Jr. 

Magistrate Judge Jeffrey I. Cummings 

FILED UNDER SEAL 

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PLAINTIFFS’ SUPPLEMENTAL BRIEF CONCERNING 

ADVANCED INVENTORY MANAGEMENT, INC. D/B/A ESUTURES.COM’S AND 

ANTHONY IADEROSA’S FINANCIAL RECORDS 

 Plaintiffs Johnson & Johnson, Ethicon, Inc., Ethicon US, LLC, and Johnson & Johnson 

Health Care Systems, Inc. (collectively, “Ethicon”) respectfully submit this supplemental brief in 

response to the Court’s Order (Dkt. No. 242) permitting Ethicon to address the financial records 

obtained via Ethicon’s third-party subpoenas on the banks of Defendants Advanced Inventory 

Management, Inc. d/b/a eSutures.com (“AIM”) and Anthony Iaderosa Jr. (collectively, 

“eSutures”). Ethicon has now received over thirty thousand pages of records from eSutures’s 

financial institutions in response to Ethicon’s June 17, 2020 subpoenas. Decl. of Geoffrey 

Potter, dated Sept. 16, 2020 (“Potter Decl.”) ¶ 3.1

 

 

1

 Ethicon has not yet received records for Lakeside Bank account numbers ending in 3844 or 

6644. Potter Decl. ¶ 4. Although eSutures listed those accounts in its unsworn “Iaderosa 

Account Information” exhibit filed with the Court, Dkt. No. 130, Lakeside Bank has asserted that 

those records fall outside the scope of Ethicon’s subpoena, Potter Decl. ¶ 4. Ethicon has served a 

new subpoena on Lakeside Bank to obtain those financial records. Id.

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As the Court has requested this brief within three business days of receipt of these 

records, Ethicon’s review is preliminary and ongoing. As Ethicon noted in prior filings, a 

meaningful understanding of eSutures’s finances will take time, as will Ethicon’s investigation 

of leads generated by those records. Ethicon has already served a number of additional nonparty subpoenas, and responses are starting to come in under the Court’s Expedited Discovery 

Order. Moreover, Ethicon still lacks large portions of eSutures’s financial data, which, as 

described below, severely limits Ethicon’s ability to follow the money and trace eSutures’s 

counterfeiting. 

That said, the initial review of the subpoenaed financial records provides striking 

confirmation of evidence Ethicon has already provided to the Court showing that eSutures 

knowingly engaged in the distribution of counterfeit Ethicon surgical devices. Although eSutures 

imported a large volume of counterfeits from Medserve, the bank records show that (except for 

one early transaction), eSutures did not pay for those counterfeits. And although eSutures 

shipped expired SURGICEL® devices to Medserve, the bank records show that Medserve did not 

pay eSutures for those “sales.” eSutures and Medserve were not engaged in arms-length 

transactions as buyer and seller; they were partners in a counterfeiting scheme, with eSutures 

providing Medserve with expired surgical devices that Medserve repackaged into counterfeit 

packaging with fake expiration dates, with some of the counterfeits being shipped back to 

eSutures as payment. There was no need for cash payments for these transactions because 

eSutures took its payment in repackaged, expired, and contaminated counterfeits. 

Ethicon’s initial observations, based on the incomplete data currently available, also 

confirm that eSutures’s books and records simply cannot be relied upon. eSutures has 

intentionally obfuscated the trail of money by, for example, depositing corporate checks from 

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customers payable to the order of AIM into Defendant Iaderosa’s personal accounts and by 

sending and receiving over a million dollars in untraceable cryptocurrency. 

The bank records also show hundreds of thousands of dollars—funded both by AIM and 

Iaderosa personally—being sent to Magellan Medical Supply F.Z.E. to fund eSutures’s 

“Magellan Shuffle,” which makes tracing the pedigree of eSutures’s medical devices nearly 

impossible. eSutures has refused to provide any transactional details regarding its Magellan 

accounts or its other accounts in the United Arab Emirates, and so Ethicon cannot trace the 

medical devices laundered through Magellan. 

Finally, Ethicon has already identified two new suppliers of medical devices that 

eSutures has paid, but which do not appear on eSutures’s vendor lists, further calling into 

question the accuracy of eSutures’s corporate records. 

I. Bank Records Confirm that eSutures Partnered with Medserve to Manufacture 

Counterfeits 

Despite the fact that eSutures imported a large volume of counterfeits from Medserve, the 

bank wire records show that eSutures paid Medserve for only a single purchase order, totaling 

less than $20,000, in December 2018.2

 Potter Decl. Ex. 243 The undisputed evidence shows 

that after that early purchase, eSutures acquired thousands of additional counterfeit devices from 

Medserve—but eSutures did not pay for them. This confirms that, as set forth in Ethicon’s 

moving papers, eSutures was not simply a customer unwittingly purchasing from Medserve 

without knowing that Medserve was peddling counterfeits. Rather, as evidence already 

 

2

 The wire records show two equal payments made in December 2018 for purchase order number 

183198. Potter Decl. Ex. 244. That purchase order lists 20 boxes of Ethicon LIGACLIP® Extra 

Ligating Clip (product code LT200) and 100 boxes of SURGICEL® Absorbable Hemostat 

(product code 1952). Id. Third-party shipping records show that Medserve shipped those

products directly to eSutures’s warehouse. Pl. Ex. 17. 

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presented to the Court shows, eSutures knowingly partnered with Medserve to manufacture

counterfeits: eSutures provided the raw materials, Medserve repackaged them into counterfeit 

packaging, and eSutures received some of the counterfeits back as compensation. See Dkt. No. 

176, at 34-35; Dkt. No. 238, at 4-5. This is further confirmed by the fact that despite the large 

volume of expired SURGICEL® devices that eSutures claims to have “sold” to Medserve, 

eSutures never received a single payment from Medserve. See id.; see also Pl. Ex. 47. 

II. eSutures Funneled Corporate Funds to Untraceable Cryptocurrency

The bank records also show that Defendant Iaderosa regularly deposited business checks 

made out to AIM into his personal checking account. In 2017 and September 2018, Iaderosa 

deposited nearly checks made out to AIM, totaling approximately into his 

personal checking account ( ) at Lakeside Bank. Potter Decl. Ex. 245; see Dkt. No. 130. 

Ethicon does not know why these funds were diverted in this way. But the fact that AIM’s CEO 

deposited business checks into his personal account, circumventing the corporation’s accounting 

procedures, raises serious concerns about the accuracy of eSutures’s books. 

 Moreover, the bank records show that Iaderosa moved substantial funds from his 

personal accounts into CoinBase, a platform that trades in cryptocurrencies like Bitcoin. Ethicon 

served a non-party subpoena on CoinBase, which provided the records associated with 

Iaderosa’s CoinBase account. Those records show that in addition to purchasing cryptocurrency 

with U.S. dollars, Defendant Iaderosa engaged in multiple transfers of cryptocurrency with third 

parties, consistent with a purchase or sale of goods: in total, Defendant Iaderosa received 

cryptocurrencies (Bitcoin and Ethereum) worth over $ from third parties between May 

to September 2018, and sent cryptocurrencies worth over $ to third parties between June 

to November 2018. Potter Decl. Ex. 246. Financial transactions in cryptocurrencies are 

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notoriously untraceable, as all accounts are held under pseudonyms, which is why the platform is 

favored by counterfeiters and criminals.3

 Indeed, even CoinBase could not identify the 

counterparties of Iaderosa’s transactions. For that reason, Ethicon cannot trace where these 

funds came from or where they went. The only person with knowledge about these 

transaction—Defendant Iaderosa—has taken the Fifth. The use of cryptocurrencies such as 

BitCoin, along with Iaderosa’s refusal to testify, means these funds lead to a dead end. 

III. Bank Records Show Hundreds of Thousands of Dollars being Sent to Magellan 

Medical From Both AIM’s and Iaderosa’s Accounts 

As discussed in Ethicon’s preliminary injunction papers, eSutures set up the shell 

company Magellan Medical Supply F.Z.E. in the United Arab Emirates to secretly import into 

the United States medical devices obtained from unregistered gray-market suppliers abroad, such 

as from known counterfeiters Medserve and Spa Medical/IMD. See Dkt. No. 176, at 36-40; Dkt. 

No. 238, at 10-11. eSutures’s vendor list indicates that it has purchased hundreds of thousands 

of dollars of medical devices from Magellan, rather than recording the name of the original 

vendor that supplied the product. See Pl. Ex. 83, at 33. Despite Ethicon’s discovery requests, 

eSutures has not provided any sworn information concerning the balance of or transactions in 

Magellan Medical’s accounts. See Pl. Exs. 127, 212. The accounts remain unfrozen, Dkt. No. 

 

3 See, e.g., United States v. Michael Gordon, No. 2:19-cr-232, Dkt. No. 10 (E.D. Pa. Apr. 24, 

2019) (criminal indictment describing purchases of counterfeit pills on the “Dark Web” from 

counterfeiter that only accepted Bitcoin as payment); Commodity Futures Trading Comm’n v. 

McDonnell, 287 F. Supp. 3d 213, 219 (E.D.N.Y. 2018) (“The rise in users and value of virtual 

currencies has been accompanied by increased fraud and criminal activity. The newest growing 

concern with Bitcoin, and crypto-currencies in general, are their ability to wash money and 

conceal taxable income.” (citation, quotation marks, and alteration omitted)); United States v. 

Ulbricht, 31 F. Supp. 3d 540, 547 (S.D.N.Y. 2014) (describing the use of Bitcoin as “an 

anonymous and untraceable form of payment” on the website “Silk Road,” an “online 

marketplace for illicit goods and services”). 

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130, and Ethicon does not know whether eSutures has complied with the Court’s asset freeze 

order or the business that has been transacted through those accounts. 

 The recently obtained bank records show that AIM transferred nearly $ to 

Magellan in three separate payments in October 2019 and January 2020. Potter Decl. Ex. 247. 

In addition, Defendant Iaderosa transferred $ to Magellan in May 2019 from his personal 

checking account. Potter Decl. Ex. 248. eSutures has asserted, without evidentiary support, that 

only about US $ remained in Magellan’s accounts as of July 14, 2020. See Dkt. No. 130. 

Because Defendant Iaderosa has refused to provide any transaction information regarding these 

accounts, Ethicon cannot follow the trail of funds for the hundreds of thousands of dollars’ worth 

of medical devices purchased through the Magellan Shuffle. 

IV. Bank Records Illuminate Omissions in AIM’s Corporate Records 

Even Ethicon’s initial review of eSutures’s bank records has already revealed transfer 

records showing thousands of dollars in payments to overseas medical device vendors that were 

omitted from AIM’s corporate records. These payments, coupled with their absence on 

eSutures’s vendor records, again suggest that eSutures intentionally hid these transactions 

because of their improper nature. See also Dkt. No. 176, at 44-47, 89-94. A legitimate business 

would not have unexplained payments to overseas vendors that are not reflected in its corporate 

records, just as a legitimate business would not have vendors ship inventory to the homes of its 

employees rather than to the corporate warehouse. 

First, in February 2018, eSutures wired nearly $ to a Brazilian vendor called HP 

Bioproteses Ltda. Potter Decl. Ex. 249. Although paid for by eSutures out of AIM’s corporate 

account, the devices listed in the HP Bioproteses invoice were shipped to Defendant Shah in 

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Pakistan, rather than eSutures in the United States. Potter Decl. Exs. 250, 251. HP Bioproteses 

is not listed on eSutures’s list of vendors. See Pl. Ex. 83. 

Second, in May 2018, eSutures wired nearly $ to the Chinese vendor Shanghai Shen 

Da Imp & Exp. Co Ltd. Potter Decl. Ex. 252. Shanghai Shen Da does not appear in eSutures’s 

list of vendors either. See Pl. Ex. 83. The Shanghai Shen Da invoice lists surgical staplers from 

a Chinese manufacturer called Golden Stapler Surgical Co., Ltd., Potter Decl. Ex. 253, which 

manufactures surgical staplers “modeled” on Ethicon products, see Potter Decl. Ex. 254. 

Although eSutures purchased 25 staplers at $ each, the invoice states that the staplers are 

“Demo for training and research.” Potter Decl. Ex. 253. So far, Ethicon has been unable to 

identify this purchase anywhere in eSutures’s purchase or inventory records. 

Ethicon’s investigation into these transactions is ongoing. 

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Dated: September 16, 2020 

Respectfully submitted, 

/s/ Bradley J. Andreozzi______ 

BRADLEY J. ANDREOZZI (ARDC No. 6286557) 

MATTHEW M. MORRISSEY (ARDC No. 

6302575) 

FAEGRE DRINKER BIDDLE & REATH LLP 

191 North Wacker Drive, Suite 3700 

Chicago, IL 60606-1698 

Tel: (312) 569-1000 

Fax: (312) 569-3000 

bradley.andreozzi@faegredrinker.com

matthew.morrissey@faegredrinker.com

and 

/s/ Geoffrey Potter 

GEOFFREY POTTER 

ARON FISCHER (admission application to be 

submitted) 

TIMOTHY A. WATERS (admission application to 

be submitted) 

JOSHUA R. STEIN 

PATTERSON BELKNAP WEBB & TYLER LLP 

1133 Avenue of the Americas 

New York, NY 10036-6710 

Tel: (212) 336-2000 

Fax: (212) 336-2222 

gpotter@pbwt.com 

afischer@pbwt.com 

twaters@pbwt.com

jstein@pbwt.com 

Attorneys for Plaintiffs Johnson & Johnson, 

Ethicon, Inc., Ethicon US, LLC, and Johnson & 

Johnson Health Care Systems Inc. 

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CERTIFICATE OF SERVICE 

I hereby certify that on September 16, 2020, I caused the foregoing, along with its 

supporting declaration and exhibits, to be served by electronic mail upon the following: 

Jack Selden 

Greg Marshall 

Scarlett Nokes 

Erin Sullivan 

Michael Denniston 

BRADLEY ARANT BOULT CUMMINGS LLP 

jselden@bradley.com

gmarshall@bradley.com

snokes@bradley.com 

esullivan@bradley.com 

mdenniston@bradley.com

- and - 

Alexander Vesselinovitch 

Matthew T. Connelly 

D. Richard Self 

FREEBORN & PETERS LLP 

avesselinovitch@freeborn.com 

mconnelly@freeborn.com 

rself@freeborn.com

Counsel for Defendants Advanced Inventory 

Management, Inc. d/b/a eSutures.com, Anthony 

Iaderosa Jr., Jason Einhorn, and Mike Phipps 

/s/ Matthew M. Morrissey 

 

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