Martin Shkreli: Criminal liar or troubled genius?

NEW YORK The criminal fraud trial of so-called “Pharmacy Bro” Martin Shkreli neared a close Thursday amid sharply clashing legal arguments, conflicting claims about liesand even a sexual innuendo.

A federal prosecutor argued evidence showedthe New York pharmaceutical entrepreneur wasa habitual liar who defrauded healthcare investors in a Ponzi-like scheme. But a defense attorney called the claims of prosecution witnesses who testified they were misled by Shkreli “rich people B.S.”

Kicking off a daythat featured about sixhours of sharply clashing closing arguments, Assistant U.S. Attorney Alixandra Smithsaid evidence showed thatShkreli told “lies upon lies uponlies” in four relatedfrauds, then”doubled down” to hidehisdeceit.

It is time “to pull back the curtain on these … fraud schemes, and finally see the truth behind all these lies,” Smith told the jury of seven women and five men, arguing that the government had proven Shkreli’s guilt “beyond a reasonable doubt.”

In response, defense attorney Benjamin Brafman described Shkreli as a troubled genius who may have said or done thingsthat seemed incorrect.But he insisted that Shkreli believed what he said and fortwo years he spent nights in an office sleeping bagensuring that a string ofwealthyinvestors got their money back with hefty gains.

“If Martin Shkreli says what he believes is true, I submit that’s an act of good faith,” said Brafman, who added, “and you must acquit.”

The arguments presented the jurors with a contrast of both legal arguments and courtroom styles. Smith discussedlegal elements required for the eight fraud and conspiracy charges in the case, while Brafman joked about his client’s annoying persona and citeda witness who likened Shkreli to “Rain Man,” the title character of the 1988 movie in which actor Dustin Hoffman portrayed an autistic savant.

The jurorswereexpected to begin deliberations Friday and bring the four-week trial to a close after Brafman completed his closing arguments and U.S. District Judge Kiyo Matsumoto gave them final instructions on the law.

Shkreli, a 34-year-old Manhattan resident, son of Albanian and Croatian parents andfrequent social media presence, occasionally whispered to one of his attorneys and smiled or took notes during the day’s arguments.

He opted not to testify in his own defense, a decision that spared him from being cross-examined by prosecutors.

But Shkrelileft littledoubt about his opinion, using a Facebook posting Tuesday to declare: “Time for a math lesson. The whole is equal to the sum of its parts. Not the parts you cherry pick.You can’t omit important pieces of a story and expect the people will be too stupid to figure it out.”

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Shkreli is best known as the former Turing Pharmaceuticals CEO who ordered a5000% price hike in 2015 on Daraprim, a medication used to treat toxoplasmosis, a parasitic illness that typically strikes those with the AIDS virus and others with weakened immune systems.

He never apologized or backed away from the decision, which brought him international notoriety, as well as criticism fromsome 2016 presidential candidates.

Instead, the case against Shkreli focuses on charges he defrauded investors in MSMB Capital and MSMB Healthcare, hedge funds he co-founded. When the funds cratered, in part due to disastrous Shkreli trading, he allegedly repaid theinvestors by looting stock and money from Retrophin, another pharmaceutical company he launched and led.

Shkreli faces up to 20 years in prison if convicted.

Federal prosecutors called witnesses who testified that they viewedShkrelias extremely knowledgeable about health care companies and their drugs but also someone who misled or lied to them.

Contradicting rosy account statements in which Shkreli reported steady gains for investors, government evidence showed the hedge funds held little money and virtually none of the promised stock investments.

Prosecutors also showed the jury a darker side of the businessman.Tim Pierotti, who ran one of the hedge funds, testified that his wife received a 2012 letter from Shkreli that falsely accused him of stealing $1.6 million.

Labeling the fund employee as a “pathetic excuse of a husband,” the letter said Pierotti “needs to get a real job that does not depend on fraud to succeed.”

“I hope to see you and your four children homeless,”the Shkreli letter added. “I will do whatever I can to assure this.”

Shkreli’sattorneys put on no defense case.Instead, they aggressively cross-examined the prosecutionwitnesses, elicitinggrudging acknowledgments that all who invested with Shkreli ultimately came out ahead.

Brafman attacked the witnesses again in his closing argument, argued several had lied. He also questioned testimony in which Steven Richardson, a former Retrophin chairman who is gay, said Shkreli suggested he might be gay, too. Actually, Richardson tried to seduce Shkreli, Brafman suggested.

Accusing Smith of “ignoring” the testimony contradictions during the prosecution’sclosing arguments, Brafman told jurors: “I’m not offended, but you should be.”

The no-harm-no-foul defense strategy seemed aimed at convincing panel membersthat Shkreli’s laserfocus on building his companies and unshaken belief in his corporate “mission” outweighed any legal or regulatory lines that may have been crossed.

Under U.S. law, however, repayment of investors does noterase any actsof fraud.

In her legal chargeprepared for the jury, Matsumoto cautioned the seven womenand five men that “even if any attorney or witness has stated a legal principle different from any that I state to you in my instructions, it is my instructions that you must follow.”

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Martin Shkreli called 'genius' and 'liar' as trial starts

The Shkreli trial has proved to be no ordinary white-collar crime trial.

Brafman signaled as much the week before jury selection began when he said the trial would show that his client is “traveling to the beat of his very unique drummer.”

Roughly a dozen of the more than 250 people screened during jury selection were excused because they expressed open bias against Shkreli. A few members of that group alternately referred to him as a “snake,” the “face of corporate greed” and the “most hated man in America.”

Shkreli confirmed Brafman’s personality prediction bymaking a surprise June 30 visit to a courtroom where reporters and the public could view the proceedings, and then labeled the federal prosecutors handling his case the “junior varsity.”

Shkreli also insisted one government witness who testified he’d misled her had not beena “victim,” maintained he never considered seeking a plea deal with prosecutors,complained about news headlines about the trial and griped that people “blame me for everything.”

“Do I want to exonerate myself?” Shkreli asked reporters during an unprompted conversation.

“Yes.”

Prosecutors argued that Shkreli’s comments could have been heard by jurors, potentially tainting the panel in the trial’s early days. Matsumoto issued a modified gag order in response, ordering Shkreli to stop talking about the casein and around the Brooklyn federal courthouse where the trial is playing out.The orderdidn’t stop Shkreli from speaking his mind during regular Facebook Live and live-streamsessions via YouTube after trial sessions.

“We’ve got the prosecutors pretty freaked out,” Shkreli said during a July 2 Facebook Live session in which he offered investing advice while hosting the event in a V-neck T-shirt and shorts. “The case is falling apart before their eyes, and they don’t know how it’s happening. Sad.”

In an odd echo of his drug price hike decision, Shkreli also posted a Facebook offer to sell Internet domains in the names of two female reporters covering his trial.

“I bought these domains for $12 you can have them for $12,000, he wrote, explaining he wasraising money “for my debut album: Gods Gift.'”

“Of course hes jacking up the price,” the New York Post, the employer of one of the reporters, saidin a story about the episode.

Follow USA TODAY reporter Kevin McCoy on Twitter: @kmccoynyc

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