[U 3X] We Still Expect At Least Two More Letter Briefs — Before 6 PM EDT Here, On Sunday…

UPDATED @ 7:35 PM EDT — I’m off-grid, to catch the si fi flick called “Valerian” (the one that opened this weekend, with Ri-Ri), in two minutes now — but each side just moments ago supplemented their prior letters. [The stress and lack of sleep is showing, with the minor typos — in both letters.]

Prosecution’s E-mails Supplemental Letter;

Defense’s two letters — more argument on Delaware Section 144 (on Saturday) — and another, on Sunday night (a three page PDF file).

More later, after the flick. We still expect one more round from each, on Sunday. 

UPDATED @ 3:20 PM EDT — Three new letters (one), and (two) and (three). Each is now in place in the narrative, below — from the able Judge’s overnight orders. And I must say, document three advances a largely preposterous view: it is a defense position paper, that essentially argues no Delaware law applies to Mr. Shkreli’s role as a controlling shareholder, officer and director of a pubic company. That is… beyond the pale, by three shades, at least. I understand why the defense took that position — because after the now-infamous “F-that” email, from Mr. Shkreli — he is guilty on Counts Seven and Eight, unless the law doesn’t apply to him. at all — so that is what the defense posits. It just is… largely without merit.

The able judge is likely to give the AUSAs’ proposed instruction as an amended version of overall Count Seven instructions, now.

[End, update. But there still are likely to be two more letters between now, and Sunday night.]

To provide the context for these dueling letters, here is the newly-released SECOND minute order, from Friday — and the proceedings which occurred after the jury was excused yesterday — along with the various briefs as ordered by the able Judge Matsumoto, and their due times [for easy reference, as the briefs come in, I will link them, near the text of the due time, in below order]:

…Jury Trial as to Martin Shkreli held on 7/21/2017. After the jury was excused for the day, the court heard the parties’ additional arguments regarding the following legal issues:

(1) Defendant’s objections to the government’s proposed exhibits regarding emails: the court ordered that defendant provide the legal bases for any objections by the afternoon of 7/21, and the government respond by 9:00 a.m. on 7/22/17. If offered as a co-conspirator statement, the government shall cite to evidence that a recipient or sender of an email is a co-conspirator.

(2) The government has requested leave to submit additional briefing for the admission of the settlement agreements of two MSMB Healthcare investors (SS and ML), and shall do so by the evening of 7/21/17, and the defendant shall respond by 1:00 p.m. on 7/22/17. [Prosecution’s later Saturday supplement.]

In addition, during conferences with the parties on 7/20 and 7/21, the defense argued that the government has not proffered any evidence establishing that the defendant, as CEO and a Director of Retrophin, failed to comply with corporate obligations in connection with the settlement and consulting agreements. The court encouraged the parties to discuss whether Delaware law should be presented to the jury, if at all, through a witness or a jury instruction. After the conference, the court was advised in two separate phone calls by defense counsel Jacob Kaplan, Esq. and Andrea Zellen, Esq., that the parties agreed that the government would call a witness to explain Delaware corporate law and that the parties would not submit briefing on the issue, and further, that the defendant reserved his right to call a Delaware law witness.

The court has reviewed Delaware General Corporation Law (DGCL) Section 144, cited by the government during the 7/21 conference, and is not convinced that the plain text of this provision applies to the settlement and consulting agreements. [Additional, post- “no instruction” defense arguments, late on Saturday.] Moreover, the court is concerned that the possibility of dueling Delaware law witnesses may confuse the jury and usurp the role of the Court.

Accordingly, in lieu of either party calling a witness to testify regarding Delaware law, the court directs the parties to submit a proposed jury instruction [that’s the government’s proposed amended instruction] or stipulation regarding the obligations and restrictions, if any, imposed upon a [majority/controlling stockholder,] corporate officer [and director] under Delaware law, with regard to the contested agreements in Count Seven

Proposed instructions [Defense “no instruction” brief] or a stipulation must cite to supporting legal authority and shall be submitted for the court’s consideration no later than 3:00 p.m. on Saturday, 7/22/17….

A long, grueling weekend (with lots of take-away greasy NY pizza, and black coffee) for all the lawyers involved — and we are still two days away, from Monday! I would only add that the Delaware law is pretty clear — and Mr. Shkreli willingly violated it with his “F-that”, and many other emails in the government’s 14 pager this morning.

And… as I’ve said right along — the Count Eight parking crime is entirely independent of Delaware law. It is a pure creature of federal securities law. And the Fearnow share threats — which even Mr. Shkreli has admitted previously (and under oath?) he personally made to Mr. P’s family… prove Mr. Shkreli’s guilt, on that count — beyond any reasonable doubt.

Off — for a workout — and a mountain bike ride, in the warm sunshine here!


8 thoughts on “[U 3X] We Still Expect At Least Two More Letter Briefs — Before 6 PM EDT Here, On Sunday…

  1. R West says:

    You can tell the lawyers are getting tired … the quality is dropping off. Not sure why the Judge is rushing them so much … I bet she has a vacation scheduled for early August and wants this trial finished so she can leave town!

    Liked by 1 person

    • condor says:

      I think it is primarily because the prosecution — if no more evidence is allowed/determined to be fair, under fifth amendment — will wrap up in a day or two. Can’t reopen the case… so this needs to be decided, post haste.

      And the jurors have lives, too… waiting beyond Monday to restart with jury risks lack of recall, and increases chances of “outside” influencers…

      So it all must happen this weekend.

      Finally, many securities defendants stipulate to these emails and settlement agreements, so that their importance is diminished before the jury… “just dry records”… but here (correctly, I think) Mr. Brafman knows his guy gets convicted on Counts Seven and Eight, unless he fights tooth and nail.

      We shall see. Never have I seen clearer evidence of securities law violations, by email no less, than in this case. And that’s more than 30 years… of watching.

      Finally, to the extent the defense papers argue that Delaware law is unclear, well — that’s what his lawyer was for. If he had followed the legal advice rather than responded “F-that!”… he might be safer.

      The defense cannot argue defense of advice of counsel where Mr. Shkreli absolutely did the opposite of what his lawyer advised.

      In sum — he’s stuck.


      Liked by 1 person

  2. R West says:

    When Shkreli made the prison comments, he was thinking maybe a year in prison camp. One securities lawyer said that if he plead guilty, he was looking at 5 – 7 years. If he’s convicted at trial, that sentence would likely double to 10 – 14 years. Judge Matsumoto is considered a moderate in sentencing … not too harsh, but not too lenient either.

    Liked by 1 person

  3. aldt440 says:

    “Proposed instructions or a stipulation must cite to supporting legal authority and shall be submitted for the court’s consideration no later than 3:00 p.m. on Saturday, 7/22/17….”

    I love this!! She’s taking on a motherly role and both sides are acting like children!! hahahah

    Liked by 1 person

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