A defiant Duluth head-shop owner went on trial in U.S. District Court on Tuesday in a case that illustrates the nation's battle over what constitutes illegal drugs.

Jim Carlson, owner of the Last Place on Earth, his girlfriend and his son are charged with 55 counts of illegally selling banned synthetic drugs by allegedly "misbranding" them as herbal incense, bath salts, watch cleaner and other names.

"They are recreational drugs used to get high," said federal prosecutor Surya Saxena in his opening argument to the jury, accusing the three of conspiring to circumvent federal statutes. "They called the product one thing when they were something else."

Labeling the prosecution case an "ambush," defense attorney Randall Tigue countered that the chemical compounds the head shop sold were not banned and that Carlson obeyed the law.

"If a drug was banned, he would not sell it," said Tigue. "He did it from Day One and he did until the day it [the store] closed."

The increasing popularity of synthetic drugs has alarmed authorities, who blame the drugs for thousands of calls to poison-control centers and more than 20 deaths in the United States, including at least two in Minnesota. A Star Tribune investigation in 2011 reported that at least two products sold at the store in 2011 contained chemicals that mimic illegal drugs.

But a federal jury will have to grapple with the defense contention that Carlson was meticulous about taking synthetic drugs off the sales counter when he learned that they had been outlawed and replacing them with another substance.

"These [drugs] were not banned and they were not substantially similar," said defense attorney John Markham.

Carlson's girlfriend, Lava Marie Haugen, and his son, Joseph James Gellerman, were employees at the store. The three were charged in December 2012, more than a year after local authorities first identified Carlson's store as a key source of fake pot and other synthetic drugs in Minnesota.

Carlson has fired back, suing the federal government to make it reveal the legal basis for its high-profile raid on his Duluth store in July 2012, when agents seized a large amount of his inventory, two vehicles and almost $3 million in cash.

Carlson, whose store is currently shuttered pending the outcome of a nuisance lawsuit brought by the city of Duluth, has been an outspoken challenger of the government's right to crack down on synthetic drugs, saying the laws used to prosecute sellers have been "unconstitutionally vague."

Carlson, who admittedly made millions of dollars, said his sales tripled after he began selling synthetic drugs in 2009.

Authorities had raided Carlson's store on Sept. 21, 2011, and seized weapons, cash, business records and suspected synthetic drugs. Carlson filed a complaint against the city of Duluth, asking for the return of the weapons and $83,000 in cash.

A St. Louis County judge ruled in February 2012 that the seized items were within the scope of the warrant and that police may retain them pending the outcome of Carlson's criminal trial. Carlson appealed, but the appeals court ruled against him, reasoning that the federal charges were directly related to the seized evidence.

Advice to jurors

Jury selection began on Monday and was completed on Tuesday.

Before opening arguments began, U.S. District Judge David Doty counseled jurors not to discuss the case with anyone, including their families, and told them not to go on Google to research the case nor to post what they were doing on Facebook.

"Don't tweet, twitter or whatever you call it," he said in a friendly but firm voice. "Don't e-mail, text, or whatever you do."

The arguments

On video monitors in front of the jurors, assistant U.S. attorney Saxena showed them a photo of a line of people waiting to get into Carlson's store.

He said Carlson labeled the drugs "not for human consumption" though they clearly had one purpose, which Saxena said was to be ingested, snorted or inhaled. He said Carlson asked his employees to try out the compounds to let him know the effects.

Saxena said undercover agents would testify and show video of what the defendants told purchasers.

And Saxena promised to show jurors an e-mail that he said Carlson sent in which Carlson acknowledged that selling the drugs was a risk but that he was making so much money he was going to continue to sell them.

Saxena said there would be evidence to show the store raked in tens of thousands of dollars a day and made millions.

In his opening argument, defense attorney Markham said the U.S. Drug Enforcement Administration cannot agree on what are controlled substance analogues. And he said prosecutors were "absolutely right" when they said Carlson switched from drugs that were banned to ones that were not banned.

He said there was substantial evidence that Carlson was not trying to mislead people, noting that he regularly spoke to the news media about what he was doing.

"There was no intent to defraud," Markham said.

"After you hear the evidence, you will come to the conclusion they are not guilty of the charges."

The trial is expected to last two to three weeks in Judge Doty's courtroom in the U.S. Courthouse in Minneapolis.

At the request of the prosecution, Doty instructed attorneys for both sides not to comment about the case to the news media and said the prohibition extended to the defendants.

Randy Furst • 612-673-4224