When will USANA ever learn?

September 4th, 2007
Ms. Tanya Beard, Esq
Securities and Exchange Commission
Ms. Karen Martinez - Chief Trial Council
Securities and Exchange Commission
15 W. South Temple Street, Suite 1800
Salt Lake City, UT 84101
Special Agent Matt Galioto
Federal Bureau of Investigations
135 Pinelawn Road, Suite 350
South Melville, NY 11747
Dear Ms. Beard, Ms. Martinez and Special Agent Galioto;
Per my earlier email, please find the below evidence which appears to demonstrate that Usana
Health Sciences, Inc. has attempted to reinvent the Medical Advisory Board by recently creating
a “Scientific Advisory Council” (http://www.usana.com/dotCom/company/ag/mab). This council
contains many of the same names (for example, Dr. Christine Wood and Dr. Ray Strand) and
no longer contains Dr. Ladd McNamara, as he appears to be replaced with Peter W. Rugg and
Dr. Ricardo Calderon.
Dr. McNamara was replaced because he lost his medical license to practice in both Georgia
and Ohio, yet was still technically practicing medicine by placing “MD” next to his name while
living in California. According to California law, this constitutes the practice of medicine, and
requires a state license. As Helen Malmgren recently reported in the National Business Review:
But according to Candis Cohen of the State Medical Board of California, where Mr
McNamara currently lives, “He is so wrong…As long as he’s living here he can’t call
himself ‘MD’ or ‘doctor’ or ‘physician’ unless he has a California medical license.”
Ms Cohen referred to section 2054 of California’s business and professions code, which Mr.
McNamara appears to have violated when he advertised himself as a “board-certified medical
doctor” in flyers for a number of Usana speaking engagements in California in July.”1
One would think that Usana Health Sciences, Inc would not, in the abundance of caution, make
this mistake again and harm their stockholders by posting any new resume in this reinvention of
their medical advisory board that would even be close to the line when it came to credentials.
Moreover, this “scientific” council is clearly established for the benefit of the associates so they
1 Please see http://www.nbr.co.nz/search/search_article.asp?id=18770&cid=0&cname=Results.
info@frauddiscovery.net
Phone & Fax:
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can infer “independent” corroboration to the alleged scientific viability of the Usana products.
With these two factors considered, the below information becomes even more material.
Dr. Ricardo Calderon, the man who replaced Dr. Ladd McNamara, is not an MD in the United
States (his only medical degree appears to be from Guatemala) and he is not licensed in any
state in this country to practice medicine. He also has no DEA number to prescribe medicine.
But his resume on the Usana Health Sciences, Inc website reads:
Ricardo Calderón, M.D., MPH
Dr. Ricardo Calderón is a physician executive with extensive experience designing,
implementing, managing, and evaluating medical, public health, pharmaceutical, and
community health and development programs at the local, national and international
level. He currently serves as Area Director and Health Officer for the Los Angeles
County Public Health Department and Associate Professor of Preventive Medicine,
Director of International Training Programs, and Director of the MPH Global Health
Leadership Track at the University of Southern California's Keck School of Medicine.
In his biographical information for the Los Angeles County Public Health Department he lists the
following information:2
M. Ricardo Calderón, M.P.H. Area Health Officer Metropolitan Service Planning Area
(SPA 4) San Gabriel Valley Service Planning Area (SPA 3) Los Angeles County
Department of Health Services.”
Notice no “MD” next to his name in that biography. Compare that to the Associate Adjunct
Professor biographical information at the Alhambra office of the Keck School of Medicine:3
Ricardo Calderon, MD, MPH Adjunct Associate Professor, Preventive Medicine Applied
public health practice through strategic leadership, planning and management of
programs mrcalderon@aol.com.
In the abundance of caution, we hired Check Mate Investigative Services and Managing
Director Terry Gilbeau. He confirmed that Dr. Ricardo Calderon is actually Mario Ricardo
Calderon4 who appears to have graduated from Universidad De San Carlos De Guatemala and
who also appears to have received a Masters Degree in Public Health from UCLA in 1984. But
even if Dr. Calderon does possess a medical degree in Guatemala, he is not a licensed
physician in the state of California. Further, Mr. Gilbeau could not locate a DEA number or any
state in the US where Dr. Calderon is a licensed physician. This prevents him from putting MD
next to his name in the state of California - just like it precluded Dr. McNamara from doing so.
2 Please see link at http://www.lapublichealth.org/spa4/spadirector/index.htm.
3 Please see link at
http://www.usc.edu/schools/medicine/departments/preventive_medicine/divisions/behavior/education/mph/staff_list
ing.html.
4 Social Security number ending in 3796 and abridged for privacy reasons.
info@frauddiscovery.net
Phone & Fax:
1-888-300-8307
The issue is very simple under California law. One cannot, under any circumstances, put “MD”
next to his (or her) name without a California medical license, as that constitutes practicing
medicine. How the Keck School of Medicine at USC appears to have a director, Dr. Calderon,
in a prestigious position at the school while he is also apparently violating state law5 is not as
troublesome as the fact that Usana Health Sciences, Inc., in a desperate attempt to impute
“scientific” credibility to their “not better than over the counter” vitamins which are hopelessly
overpriced, recklessly fills the spot of one resume blunder with another.
And if that was not bad enough, it appears that Dr. Calderon may have a motive for this attempt
to impute credibility to Usana - he is a silver director, associate number 2542689—a fact not
disclosed in this reinvention of the medical advisory board.
I am as tired of writing and reporting these issues as you are of receiving them. But based on
the above and multiple other instances, this company and their loyal handful of cartel type
analysts will stop at nothing, and I mean nothing, to prop up this multi-level marketing company
which, according to its balance sheet and contrary to its latest income statement, is on life
support.
Perhaps if the senior management and legal counsel at Usana would spend more time
researching people they publicly place on their website to promote (and more importantly,
impute credibility to) their vitamins (remember what Mr. Almada said in the Forbes article) as
they do searching for my naked shorting partners that do not exist, then they would perhaps not
once again post, with impunity, inaccurate, relevant information. Either way, the Fraud
Discovery Institute, Inc will now increase both the scope and intensity of our investigation into
Usana Health Sciences, Inc.
Respectfully Submitted,
Barry Minkow
Co-Founder
Fraud Discovery Institute
www.frauddiscovery.net
5 No doubt a defense for Usana will be “If USC was fooled, how could we be expected to know this information”