Raid Reveals Alleged Counterfeit Shipping Center

A raid of alleged illegal apartments inside a former Dixwell factory Thursday unearthed a trove of headsets from China repackaged into Dr. Dre ​“Beats” and ​“Lg Tone+” headsets.

By the time the daylong raid was over, agents from the state labor and revenue departments and federal Homeland Security joined local cops, firefighters and Livable City Initiative (LCI) inspectors in shutting down the operation.

The operation hummed along inside the former Macalaster Bicknell lab equipment and chemical factory for as long as two years without public notice. The factory is a block from Hillhouse High School at 181 Henry St.

Dafei Cai (pictured), who is 26, moved from Canton, China, to work at the factory last May, he said. He told the Independent that he and two other workers would receive electronics from China such as projector lamps (for TVs) and vegetable processors. They would repackage the goods and sell them to customers reached through eBay and Amazon, he said. Cai said he slept upstairs in the building during the week, then stayed in Brooklyn on weekends. He said he originally found the job in China on an Internet forum.

“Our job is packaging,” Cai said. ​“UPS picks them up.”

Chunyn Sun (pictured), who originally came from China to attend the State University of New York, said he worked for a company run by a man named Shihtsung Hu, who is currently in Taiwan. The company was originally in Flushing, N.Y., Sun said. He said Hu bought the 181 Henry St. building and moved operations there over two years ago. (Land records show Hu buying the building from Macalaster Bicknell in April 2012 for $350,000.) Sun said the operation sent out 60 to 70 packages a day and sold approximately $12,000 of goods in a typical two-week period. He said its profit margin has risen as gas prices have driven down delivery costs.

Sun said he and Cai stepped outside around 10:30 a.m. Thursday to see whether they needed to use their Ryobi cordless snowblower (pictured),purchased at Home Depot, not on the Internet, to clear their property. They noticed a fire department vehicle coming down the street.

“I thought there was a fire somewhere,” he said. ​“I didn’t think they were coming for us.”

Cops were accompanying the firefighters, along with staffers from LCI, city government’s neighborhood anti-blight agency.

“Put your hands in your pocket,” Sun recalled an officer telling him. He then realized there was no fire. The agents had come for his crew.

The city agents had previously met up at the nearby Dixwell police substation to plan the raid. About a month ago, according to LCI Deputy Director Frank D’Amore, neighbors had started complaining about people coming in and out of the building at night. LCI looked into it, decided people might be living there. That would be illegal: The building is not zoned for residential use, D’Amore said.

“We can’t have anybody living here” D’Amore said, ​“especially if it’s unsafe.”

The city wrote a letter to building owner Hu. It never received a response, according to D’Amore. So the fire department applied for a warrant to search.

That’s why fire, police and LCI agents showed up at the door at 10:30 a.m. They went upstairs to find at least five finished apartments with bathrooms, plus a central kitchen.

At least three people were currently living in the rooms, according to Fire Chief Allyn Wright.

While neat and clean, the rooms lacked working smoke detectors, carbon monoxide detectors, or sprinklers, Wright said.

Then the agents walked back downstairs — and came upon a warehouse of packaged and to-be-packaged electronics. ​“In plain view, we found this stuff,” Wright said.

The city contacted the state Department of Labor, which sent an inspector. The department discovered that the company had no payroll records, no proof of paying taxes or worker’s compensation, said Gary Pechi, director of the wage and workplace standards division. Records at the scene showed the operation working under a variety of names, including First Lamp Corporation, which is based in Manhasset, N.Y., and I. Boost.

The department did not find records of the companies having registered with the state, as required by law, Pechi said. At 1:10 p.m. the department issued a stop-work order. (Asked about the different names, Chunyn Sun told the Independent that the owner had had ​“problems” with the First Lamp company and was in the process of changing to the I. Boost name.)

The cops also contacted the Department of Homeland Security. An agent arrived on scene. He then contacted experts who helped ascertain that some of the goods — the wireless head sets being repackaged and sold under the Dr. Dre’s Beats and Lg Tone lines — were counterfeit, said top Dixwell cop Lt. Sam Brown, who was in charge of the scene throughout the day.

The other goods were not determined to have been counterfeit, said Brown (pictured)

By day’s end, LCI workers Louis Vega and Fred Ortiz were preparing to board up the building once the cops finished carting the alleged counterfeit goods offsite to enter them into evidence. Pechi said a broader state labor investigation is underway. Police arrested Chunyn Sun, Dafei Cai and a woman who lived and worked with them on charges of violating trademark law, a misdemeanor. Brown said they would be released on a promise to appear in court.

Sun said he lives in an apartment downtown. Cai said he would head back to his apartment in New York; his bedroom in New Haven was no longer available.