Fraud-trial judge tells Shkreli to hold tongue while at court


Martin Shkreli’s im­promptu trial dis­cus­sions with re­porters at the Brook­lyn fed­eral court­house are over as the judge over­see­ing the case or­dered the for­mer phar­ma­ceu­ti­cal ex­ec­u­tive to stop talk­ing about it in and around the build­ing. But he can go on dis­cussing it on the In­ter­net.

Shkreli, on trial on se­cu­ri­ties-fraud charges, spent about five min­utes Fri­day in a court­room set up for an over­flow crowd, in­clud­ing re­porters. He crit­i­cized pros­e­cu­tors and the me­dia while deny­ing he de­frauded the first wit­ness in the case. The govern­ment ar­gued a gag or­der was nec-

v es­sary to pre­vent Shkreli from caus­ing a mis­trial by ex­pos­ing jurors to his opin­ions.

“I was shocked that there were these com­ments,” U.S. Dis­trict Judge Kiyo Mat­sumoto said at a hear­ing on Wed­nes­day, where pros­e­cu­tors sought a com­plete gag on Shkreli, in­clud­ing his com­ments on so­cial me­dia about the trial. The judge re­stricted him from talk­ing “in the court­house or on perime­ter roads.”

Also at Wed­nes­day’s hear­ing, pros­e­cu­tors re­vealed for the first time that Shkreli’s lawyers of­fered to have him plead guilty at least three times, in­clud­ing a week be­fore the June 26 start of the trial.

“The govern­ment and the de­fense did en­gage in mul­ti­ple dis­cus­sions, each time ini­ti­ated by the de­fense,” pros­e­cu­tor Jac­que­lyn Ka­sulis said.

Shkreli’s lawyer Ben­jamin Braf­man said he was do­ing his

duty to see if the case could be worked out with­out a trial and his client didn’t ini­ti­ate any of the talks and re­jected the idea of ad­mit­ting guilt.

“’I would never plead guilty to some­thing I did not do,’” Braf­man quoted Shkreli as say­ing. “‘We’re go­ing to trial.’”

Shkreli, 34, is fight­ing charges of op­er­at­ing two hedge funds like a Ponzi scheme.

Pros­e­cu­tors claim he took clients’ money with­out per­mis­sion and used it to start Retrophin Inc. Shkreli is also ac­cused of loot­ing $11 mil­lion of the drug com­pany’s as­sets to pay off in­vestors who’d lost money in the funds.

He faces as long as 20 years in prison if con­victed of the most se­ri­ous charges.

Shkreli, who broad­casts much of his life on­line, also has com­mented on the trial in In­ter­net videos, his Face­book page and, ac­cord­ing to pros­e­cu­tors, on Twit­ter, de­spite hav­ing been banned from the site for ha­rass­ing a jour­nal­ist. The ac­count @BLMBro, which

Shkreli is al­leged to have used, was sus­pended re­cently.

Braf­man de­fended Shkreli’s com­ments to the re­porters, say­ing he had a right to de­fend him­self against an on­slaught of neg­a­tive me­dia cov­er­age. Braf­man also in­sisted a gag or­der wasn’t nec­es­sary.

“So what hap­pened Fri­day?” the judge asked. “He walks into a press room and he starts talk­ing about the case?”

Braf­man said a re­porter with a “vendetta,” baited Shkreli. “I hope your honor un­der­stands that he’s rel­a­tively young.” The lawyer apol­o­gized

to the judge and promised it wouldn’t hap­pen again.

The judge still had con­cerns about po­ten­tially ex­pos­ing jurors to the com­ments, al­though she de­clined to re­strict their move­ments in the court build­ing or to se­quester them.

“What is hap­pen­ing, based on your own client’s con­duct, there is a dan­ger that those jurors will be ex­posed,” Mat­sumoto said. “There is a great risk.”

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