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2 OC Medical Firms Sued Over Sale Of Fetal Tissue

YORBA LINDA ( — A lawsuit says two Southern California medical firms have illegally profited from the sale of fetal tissue.

The suit filed by the Orange County District Attorney's Office late Tuesday says DV Biologics, LLC, and DaVinci Biosciences, LLC, made tens of thousands of dollars in revenue by selling fetal tissue and stem cells donated from abortion providers to research groups around the world.

"This case is not about whether it should be lawful to sell fetal parts or whether fetal tissue research is ethical or legal. We are simply charging DV Biologics, DaVinci Biosciences, and a father and his two sons with illegally selling hundreds of fetal tissue products for profit and treating human parts as commodities instead of giving it the respect the law intended. This lawsuit is aimed at taking the profit out of selling body parts," District Attorney Tony Rackauckas said in a statement.

It's illegal to profit from the sale of fetal parts, but an organization providing the tissue can charge a fee to recover its expenses.

The law does not allow for criminal penalties, so the District Attorney's Office filed a civil action alleging unfair and unlawful fraudulent business practices and seeking penalties, costs and restitution for the scientists and researchers that bought the fetal tissue at allegedly marked-up prices, said Deputy District Attorney Kelly Ernby.

The two companies primarily conduct business in the Orange County cities of Costa Mesa and Yorba Linda, but were incorporated in Delaware. DaVinci Biosciences is jointly owned and operated by the same people who own and operate DV Biologics and share office space, management and employees, according to the OC District Attorney's Office. The California Franchise Tax Board forfeited the two companies' powers, rights and privileges in 2014 and 2015.

Prosecutors allege the two companies advertised the "total RNA" cells from several fetal tissue sources in a range as low as $40 a vial to as high as $1,100 a vial for fetal brain tissue. Fetal lung tissue was priced at $300 to $375 a vial, fetal kidney tissue at $300 to $450 a vial, between $500 and $700 for fetal heart tissue and $250 to $700 for fetal liver tissue, according to the complaint.

By 2011, the two companies had sold fetal-derived tissues and cells to countries, including Japan, China, Singapore, Korea, Germany, Switzerland, Spain, Australia, Netherlands, Canada and the United Kingdom, according to prosecutors.

Rackauckas alleged the defendants "set their prices as high as possible in an effort to maximize their profits. Sales and marketing staff were hired, paid commissions, and pressured to push sales in order to meet increasing revenue objectives and expenses."

The county's top prosecutor emphasized that Planned Parenthood did nothing wrong in donating the tissue. It is routine for the organization to donate the tissue to scientists for research, he acknowledged.

"The violation is they were sold for profit," he said. "We're not indicating that Planned Parenthood did anything unlawful."

Ernby said that even though Planned Parenthood could have charged fees for expenses, the organization simply donated the tissue without cost.

"We did not have any evidence they were charging anything," Ernby said.

(TM and © Copyright 2016 CBS Local Media, a division of CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2016 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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