The question of whether “felon” will be another moniker attached to Martin Shkreli, a former pharmaceutical executive standing trial for securities and wire fraud who has been given the tongue-in-cheek nickname “Pharma Bro,” was placed July 28 in the hands of a federal jury in Brooklyn.
While better known as the man responsible for increasing the price of an antiparasitic drug by 5,000 percent, Shkreli is accused of running a form of Ponzi scheme in which he defrauded investors into two hedge funds he created and paid them back by misappropriating $11 million in assets from Retrophin, which he also founded.
Shkreli is charged with eight counts, including wire fraud, conspiracy to commit wire fraud and conspiracy to commit securities fraud, and faces up to 20 years in prison.
On July 28, Eastern District Judge Kiyo Matsumoto read more than 90 pages of instructions to the jury of seven women and five men on July 28, the end of the fifth week of the trial. Deliberations begin today.
During instructions, Matsumoto advised jurors that good faith—that he would eventually make his investors whole—is a complete defense to the charges against him.
But she advised that Shkreli’s defense to two of his counts—that he relied on the guidance of his attorney—former Katten Muchin Rosenman partner Evan Greebel—was not a complete defense. Greebel, Shkreli’s codefendant, is expected to stand trial on charges of conspiracy to commit wire fraud and conspiracy to commit securities fraud in October.
The jury charge came after closing arguments from Benjamin Brafman, Shkreli’s lead defense counsel, and a prosecution rebuttal delivered by assistant U.S. attorney Jacquelyn Kasulis, head of the business and securities division for the Eastern District U.S. Attorney’s Office.
In the second part of Brafman’s summation, he continued to hammer the main themes of Shkreli’s defense—that Shkreli is a misunderstood pharmaceutical wunderkind and that the alleged victims were wealthy investors who ultimately got richer—and encouraged jurors to tune out negative criticism of his client they may have heard from witnesses and through the media.
“Reasonable doubt is circling the atmosphere like a bunch of drones, requiring you to find him not guilty,” Brafman said, his voice becoming weary.
Shkreli’s defense team also includes Brafman & Associates attorneys Marc Agnifilo, who handled cross-examinations during the trial, Jacob Kaplan and Andrea Zellan.
But in her rebuttal, Kasulis took aim at Brafman’s summation, which he peppered with analogies and visual aids such as one instance on July 27 when he held up a bag of potato chips he grabbed from the prosecution table to illustrate the complexity of mass producing goods.
Brafman’s intent, Kasulis said to jurors, was to “cloud your judgment by appealing to your emotions, maybe your deepest fears” and that he spent much of the summation discussing the “mythological Martin Shkreli.”
Regardless of whether or not the investors who fell victim to Shkreli’s alleged scheme were eventually made whole, the prosecutor argued, “lying to people to get them to invest with you is fraud.”
“You can’t rob Peter to pay Paul,” Kasulis said. “It doesn’t work that way.”
Assistant U.S. attorneys Alixandra Smith and Girish Srinivasan are also on the prosecution team.