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Martin Shkreli Seeks New Trial, Saying the Judge Got It Wrong

Martin Shkreli Seeks New Trial, Saying the Judge Got It Wrong

(Bloomberg) -- Martin Shkreli says the judge and jury in his fraud case got it wrong. With Shkreli locked up in a Pennsylvania federal prison, his lawyers on Friday tried to persuade an appeals court in Manhattan to overturn his conviction and give him a new trial.

It didn’t go well.

The federal appeals court in Manhattan appeared so skeptical of Shkreli’s argument, they allowed the prosecutor to conclude her arguments with one minute left on the clock, didn’t ask any further questions and didn’t ask Shkreli’s team for a rebuttal.

Defense lawyer Mark Baker said U.S. District Judge Kiyo Matsumoto gave incorrect legal instructions to jurors, leading to an inconsistent verdict in which the panel found Shkreli guilty of one count of conspiracy and two counts of securities fraud but cleared him of five other charges.

The judge “confused” jurors, Baker said, arguing that Shkreli lacked the intent to defraud his investors because he thought his failing hedge funds would eventually recover.

Almost immediately, U.S. Circuit Judge Joseph Bianco interrupted him, noting that during the trial, Shkreli’s lawyer Benjamin Brafman told jurors his client hadn’t committed any crime or defrauded investors because some actually made money.

“If that type of argument is made, someone has to tell the jury that just because the investor ultimately made money, it doesn’t mean that it’s not wire fraud or securities fraud,” Bianco said.

Shkreli was convicted two years ago of lying to investors in two of his hedge funds and also manipulating shares of Retrophin Inc., a biotech company he founded. He was sentenced to seven years and sent to a low-security prison camp.

The panel didn’t immediately issue a decision.

Shkreli was moved from the low-security camp in March after the Wall Street Journal reported he was using a contraband mobile phone to secretly run Turing Pharmaceuticals, now known as Phoenixus AG, as well as posting on Twitter. The facility he’s now in is more secure, with about 1,260 inmates living in dormitory areas and cells. Shkreli isn’t scheduled to be released until October 2023.

Dubbed the Pharma Bro, Shkreli became notorious in 2015 while serving as chief executive of Turing, increasing the price of a potentially lifesaving drug by more than 5,000%. That gained him another moniker -- the most hated man in America.

To contact the reporter on this story: Patricia Hurtado in Federal Court in Manhattan at pathurtado@bloomberg.net

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Peter Jeffrey, Joe Schneider

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