Ken Paxton

AG Paxton Reaches $1.175 Million Settlement with Katz Boutique

Thursday, September 8, 2016 – Austin

Attorney General Ken Paxton today announced that the Office of the Attorney General (OAG) and the Harris County Attorney’s Office (HCAO) have reached a settlement of $1.175 million with the Katz Boutique stores and their owner, Bao Quoc Nguyen, also known as Tony Nguyen. The settlement stems from a lawsuit filed in 2015 against Nguyen and his stores for violating the Texas Deceptive Trade Practices Act and the Texas nuisance law numerous times by selling synthetic marijuana. In addition to the settlement, Nguyen and his companies entered into an Agreed Final Judgment and Permanent Injunction (AFJPI) banning Nguyen and the Katz Boutique stores from ever selling synthetic drugs and controlled substances.

The Katz Boutique stores are located throughout Harris County and sell adult novelty items and smoking accessories. As a part of the investigation, OAG and HCAO teamed up with the Harris County Sheriff’s Office Narcotics Task Force and Vice Unit (HCSO), who conducted undercover operations. Over the course of four months in 2015, undercover HCSO officers purchased multiple packets of synthetic cannabinoids labeled as “Kush” from Katz Boutique. The packets deceptively labeled the main ingredients as innocuous-sounding legal plant substances such as “lemon balm,” “passion flower,” and “wild lettuce.” Furthermore, the packets also claimed to be “lab certified” and legal for sale in all 50 states. The highly illegal and dangerous cannabinoids found in the packets can cause severe paranoia, psychotic episodes, violent delusions, kidney damage, suicidal thoughts, and self-mutilation.  According to the Drug Enforcement Administration, synthetic cannabinoids are the most abused substance by high school seniors; overdoses of these dangerous drugs are increasing in Texas.

The Katz Boutique lawsuit was the first synthetic cannabinoid lawsuit filed jointly by the OAG and HCAO. Evidence collected during the lawsuit revealed the stores sold over 90,000 packets of synthetic drugs to Texas consumers since 2013 and made millions of dollars from sales of illegal drugs. Businesses often market synthetic cannabinoids as being safe without disclosing they are dangerous and illegal. 

To view a copy of the AFJPI click here: Agreed Final Judgment & Permanent Injunction

To view a copy of the settlement click here: Katz Boutique Settlement