Former pharmaceutical company executive Martin Shkreli and his lead attorney Benjamin Brafman arrive for the fourth day of jury deliberations in his securities fraud trial at Brooklyn U.S. District Court in New York City, USA, on August 3, 2017.
Amr Alfiky | Reuters
The Supreme Court in an order on Monday rejected notorious “pharma bro” Martin Shkreli's request to hear his appeal. He sought a $64 million fine against the fraudster who blocked competition for a life-saving drug whose price he increased by more than $700 per pill.
Shkreli's request that the Supreme Court accept his appeal of a federal court decision was his last chance to overturn the sentence related to the drug Daraprim.
The Supreme Court rejected this request and gave no reasons. There was no dissent noted by any judge against Monday's order.
Shkreli's lawyer had asked the Supreme Court to accept the appeal to resolve a so-called circuit split between the appeals court that upheld his fine and two other federal appeals court circuits that the lawyer said would have limited his financial liability in the case .
Attorney Thomas Huff told CNBC: “While we were disappointed by the decision, we also believe it is only a matter of time before the Supreme Court overturns the Second Circuit's outlier approach to equitable disgorgement – an approach that has been ignored in this one Case One…The District Court Orders Mr. Shkreli to Disgorge Over $64 Million in Profits That Never Affected His Ownership or Control.”
“If the Supreme Court does so, Mr. Shkreli will have a strong case to change the order accordingly,” Huff said in an email.
A spokeswoman for the Federal Trade Commission, whose lawsuit against Shkreli led to the penalty, declined to comment on the Supreme Court's decision.
People pass by the U.S. Supreme Court in Washington, DC on October 7, 2024
Kent Nishimura | Getty Images
Shkreli gained national notoriety in 2015 when his pharmaceutical company raised the price of Daraprim by more than 4,000%. The drug is used to treat parasitic infections in pregnant women, babies, people with HIV, and others.
In 2020, while Shkreli was serving a prison sentence for financial crimes unrelated to Daraprim, he and his company Vyera Pharmaceuticals were sued by the FTC for allegedly illegally blocking competition with Daraprim. The FTC and a group of state attorneys general who joined the lawsuit said Shkreli's actions cost consumers tens of millions of dollars each year.
In January 2022, a federal court judge in Manhattan ruled in favor of the FTC, banning Shkreli from the pharmaceutical industry for life and ruling that he must forfeit $64.6 million in profits he made by increasing the price of Daraprim.
The 2nd U.S. Circuit Court of Appeals upheld that sentence last January in a unanimous decision by a three-judge panel.
Shkreli asked the Supreme Court in June to hear his appeal against that ruling, but only on the fine. There is no automatic right to appeal to the Supreme Court.
Shkreli's attorney, Huff, said in his Supreme Court filing that the 2nd Circuit's decision conflicts with the rulings of the 5th and 11th Circuit Courts of Appeals, which “limit a defendant's liability in disgorgement to his personal gain from misconduct.”
“Conversely, the Second Circuit has concluded that a defendant may be ordered to disgorge profits that he or she never received, owned, or controlled, but which instead accrue to other parties,” the motion states.
Huff wrote that Shkreli did not personally make any profits from the conduct deemed anticompetitive, but rather that they were made by his corporate co-defendants in the case.
Huff argued that the Supreme Court should hear Shkreli's appeal to resolve so-called circuit apportionment on the issue of a defendant's financial liability.
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