USA TODAY International Edition
Shkreli’s trial: Why we can’t look away
Notorious ‘ Pharma Bro’ going to court on wire fraud and conspiracy charges
Any other securities and wire fraud trial would probably attract little more than a glance from courthouse spectators, let alone the larger American public.
But the proceeding set to start Monday is not just any trial: It’s the Martin Shkreli legal show!
A year and a half after his arrest — and following hundreds of tweets, scores of online boasts, dozens of live- streams and his purchase of a unique Wu- Tang Clan rap album for a reported $ 2 million — Shkreli gets his turn to take on the prosecutors who have charged him with conspiracy and fraud.
And everyone wants to experience it, it seems.
No matter that his case has no direct ties to the issue that brought the former pharmaceutical company CEO national notoriety: ordering a 5,000% price hike on a medication for HIV patients and others with compromised immune systems, then refusing to retreat or apologize. Repeatedly.
And never mind that the man informally dubbed the “Pharma Bro,” a 34- year- old son of Albanian and Croatian immigrants, may opt against taking the witness stand in his own defense.
For the final pretrial hearing last week, many legal interns joined reporters in U. S. District Court, packing it to overflowing.
During legal arguments, Benjamin Brafman, the veteran criminal lawyer who’s leading the defense team, indirectly summarized the attraction of Shkreli: He is “traveling to the beat of his very unique drummer.”
Jurors are scheduled to hear dozens of witnesses whose testimony will alternately support and question the eight- count indictment against Shkreli. It accuses him of illegally taking stock from Retrophin — a biotechnology company he started in 2011 and was ousted from in 2014 — and then using it to pay unrelated debts owed to investors in hedge funds he’d previously headed.
The indictment also accuses Shkreli of defrauding investors in MSMB Capital and MSMB Healthcare through misstatements and omissions about the financial performance of the hedge funds, how much other investors put in and how much Shkreli took out.
In all, he withdrew and spent more than $ 200,000 from MSMB Capital during the fund’s operating life, “far in excess of any permitted fees,” the indictment charges.
While winding down the funds in 2012, Shkreli raised suspicions by telling investors they could redeem their stakes for cash or take Retrophin shares instead, the indictment alleges. But instead of paying them with money from the funds, he allegedly arranged to compensate them from Retrophin, via payments for phony consulting agreements.
Shkreli has pleaded not guilty. So has Evan Greebel, the former Retrophin outside counsel who was also charged in the indictment. In April, the federal judge presiding over the case, Kiyo Matsumoto, ordered separate trials for the men, with Shkreli going first. She ruled that Greebel’s legal defense plan to characterize his co- defendant as a liar “would present a serious risk that Shkreli will not receive a constitutionally fair trial.”
The trial is expected to last four to six weeks, attorneys on both sides estimated.
There’s been no decision yet on whether Shkreli will testify in his own behalf, Brafman said during the final pretrial hearing. Afterward, he declined to discuss the defense plans, saying, “I really think that we’re going to try this case in the courtroom.”
Prosecutors appear ready to present evidence about other parts of Shkreli’s financial career. During a work stint at Royal Bank of Canada, Shkreli doubled his allowable trading limit and hid it from the company, prosecutors said during the pretrial hearing.
This case is unrelated to the huge drug price hikes that brought Shkreli national notoriety.