San Antonio Express-News (Sunday)
N. Texan charged with multistate trafficking
DALLAS — Justin Magnuson, a successful Dallas entrepreneur, sold his health care company for almost $100 million while still in his 30s and began investing in new business ventures.
He expanded his new spa company, became a partner in local bars and bought dozens of acres of rural Northern California land, court records show. But what really brought in the profits, federal authorities say, were the California fields that produced marijuana for sale across the U.S.
Magnuson, 39, a Southern Methodist University graduate, has multiple degrees, was partly raised by a former Drug Enforcement Administration agent and was once named one of Dallas' most eligible men.
Now he sits behind bars awaiting trial in North Texas, accused of being a leader in a large marijuana trafficking conspiracy.
Authorities say Magnuson and other defendants transported marijuana inside soda vending machines in semitrailers and then used his private jet to fly the cash proceeds back to the West Coast. Magnuson, who had been attending UCLA, laundered drug profits through his various Dallas businesses, including It's a Secret Med Spa and a bar named Vice Park, prosecutors say.
Magnuson gave his co-defendants shares in his spa chain in exchange for drugrelated cash, said Ryan Slicker, an Irving police investigator assigned to a DEA task force, during a hearing.
A lawyer for It's a Secret Med Spa said Magnuson stepped down in August or September and is no longer affiliated with the company.
When agents raided Magnuson's penthouse Dallas condo this summer, they found a pile of cash; an “arsenal”
of guns; a bulletproof helmet and body armor; and a “go-bag” packed with survival guides and gear, court records show. Slicker called it a backpack “loaded and ready for him to flee.”
Also indicted in the Plano-based case in the Eastern District of Texas is his stepbrother, Clay Magnuson, whom he allegedly recruited for his drug business, court records show. Jacob Aaron Edmonds also was arrested in the case in October and detained. Benjamin Hart and Keilb Thompson were arrested in California in March and released, court records show.
A judge ordered in August that the brothers remain in custody pending trial.
“Each of them has a gobag,” said Assistant U.S. Attorney
Heather Rattan during their detention hearing in Sherman. “Justin's was more sophisticated than Clay's was, but each of them have something that they can grab and go and get out quickly.”
Defense attorneys for the brothers said their clients' marijuana growing operation in California was legal.
One of Justin Magnuson's lawyers, Mike Uhl, said his client pleaded not guilty and is presumed innocent.
He said he and his co-counsel are “busy obtaining and reviewing the evidence the government claims demonstrates Justin's guilt.”
“We will evaluate the evidence and conduct our own independent investigation,” Uhl said Friday.
Attorneys for Clay Magnuson and Edmonds declined to comment.
The DEA began investigating Magnuson's drug trafficking organization in 2018 after learning about the Northern California properties, court records show. Rattan said the conspiracy operated for 10 years and involved California, Nevada, Texas, Oklahoma and New York, with hundreds of acres of land and thousands of pounds of marijuana.
Police have seized at least $5 million in drug proceeds from the organization, according to court records.
Magnuson is also under federal investigation on suspicion of health care fraud related to his former diagnostic company, according to testimony in the case.
Justin Magnuson achieved business success at a young age with a company that pioneered technology to monitor sleep patterns and other functions. Alliance Family of Companies, based in Las Colinas, provided neurodiagnostic, cardiac and sleep testing services.
It began around 2011 when a sleep-lab company Magnuson started merged with another sleep-diagnostics company to become Alliance. As CEO of Alliance, Magnuson developed inhome testing with electroencephalogram devices, which detect electrical activity in the brain using electrodes attached to the scalp.
By 2016, the company was earning more than $50 million in revenue and was considered the “leading provider of neurological, cardiological and sleep diagnostic services in the U.S.,” according to Magnuson.
A private equity firm purchased Alliance in 2017 for $95 million, Dallas County court records show.
Authorities began investigating Magnuson's ties to the alleged marijuana smuggling organization in 2018. They discovered trucks carrying California marijuana to Texas, where it was unloaded and taken to stash houses, court records say. Cash from the drug sales was then loaded into the soda machines for transport back to California.