Martin’s ongoing financial woes now include… state level income taxes. [These local taxes were likely generated on his sale of his about three per cent overall interest, as forced by the bankruptcy courts, in the northern district of California — in a public company then called KaloBios, now known as Humanigen — in mid-2018. The IRS would have taken their cut off the top, but it is likely that NY State didn’t already have a lien to grab some of those proceeds, as they became “forced sale” cash.]
In any event, it seems he had “trued up” with NY as of early 2019 (for tax years prior to 2016), but now has once again fallen behind on his New York state level personal income tax bills, according to published reports.
So — I guess this pushes all the debts he will definitively be unable to avoid paying… a little over $50 million. All the others are completed court judgments, but one is on appeal to the Second Circuit at the moment. That appeal will fall on deaf ears, Condor confidently predicts.
Thus, perhaps the most pressing near term problem Martin faces… is finding a way to generate steady, and large amounts of regularly recurring cash income. [His YouTube live stream, mostly of him — playing online video games, or idly strumming a guitar — for six to seven hours every night… likely won’t qualify, here.]
Income, big and steady: that looks to be… a nearly impossible task — at least in any field he really knows much of anything about — given the current contempt of court motions, filed by the FTC in Manhattan. We will await his answers (through counsel) by February 10 — but if he and Ms. Murphy are smart, they’ll get an interview and the document productions “voluntarily” completed before FTC, well BEFORE February 10.
“Voluntary” is in air-quotes above because Martin is already almost six months overdue on complying with the part of the injunction that required periodic reports, and document production… about his activities related to the pharma and life sciences spheres. To avoid additional sanctions, and at least the possibility of remand, it is well past time for Team Martin to begin over-cooperation / a charm offensive in the federal district court in Manhattan (if he can).
Onward — smiling, out into the bright brisk sunshine — almost all snow now melted, but more due in overnight tonight. Now you know.
Martin Shkreli: Transitioning... To A Free Man. 
Follow up to my first comment since I seemingly can’t edit the first one:
Shkreli says he won’t be in trouble for this delay. Do you think that is the case in your professional opinion? Can he weasel out of it just by complying and submitting the compliance report in the near future, or will the contempt stick?
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Good question, Gray — his problem is that the FTC’s injunction requires his sworn statements and documentary proof — that he is NOT engaged in the pharma- or life sciences- businesses.
I’m not sure how he proves that a company he has personally touted as a “drug discovery” company… is not a pharma company, under the broad definition in USDC Chief Judge Cote’s original 2022 orders.
And the burden of proof rests on his shoulders. So, even if FTC, and Judge Cote, decide to give him a pass / overlook the half year of tardiness… I am not sure that there is anything to establish by a preponderance (much less clear and convincing evidence) that he has not already violated the injunction’s terms.
Should be… entertaining.
Namaste….
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Here was Martin’s comment on him being late to replying to the FTC, if you haven’t seen it. This is from his substack newsletter: “So what was that news about? My lawyers and I missed a deadline to file a routine update with the FTC and schedule a meeting. That will be done. I’m not in contempt and won’t be ‘in trouble’ over this. Mea culpa. It turns out some people on my team were sick during the response period and there was some telephone tag. Total non-event, but don’t tell that to the media who insists this is somehow news”.
So apparently, if you take Shkreli’s word, his lawyers were too sick to meet to the Nov 4 deadline? I am aware from your previous posts that he only picked up counsel for his appeal at least around October if not before. His excuse is incredibly flimsy, considering it’s been nearly 3 months since the original deadline and only now with the FTC pursuing contempt are they sprung to action. What’s notable as well was that the FTC said they called his attorney on November 17th and when speaking with her agreed to extend the deadline to December 2. So after this there’s no mentioned contact, so has his lawyer seemingly ghosted the FTC since November 17th? What kind of incompetent lawyer is this, could you shine some light on this, what’s going on there? Sickness doesn’t account for 2 months of ghosting. Do you think Shkreli is lying, the lawyer is a joke, or both?
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Gray — thanks for finding this.
As ever… Mr. Shkreli — and the objective truth — are often-times… complete strangers.
It seems they’ve never met.
Hilarious.
Ms. Murphy likely has not been paid, and because this is a civil matter, she is entitled to ignore his deadlines, so long as she told him he needed to pay, or she’d do no work. She was on his last losing appeal of both the Painter matter and the Koestler matter. Both resulted in judgment debts, owed by Martin. [And, to be clear, his direct appeal of the FTC ban order (in the Second Circuit) is being briefed by a completely separate well regarded if small firm in NYC. They’ve likely already been paid in full.]
And so… it seems likely that he’s behind in paying Ms. Murphy (and his personal taxes — $1.6 million, as I noted this morning).
So — he can say anything he wants on Substack, but in court — Ms. Murphy and he… have a real problem.
Unless Ms. Murphy wisely decides to withdraw entirely, that is.
Namaste — great stuff!
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Thanks for the response.
I have some questions about that — why are these lawyers agreeing to represent him? Do they get seniority on his assets if they are sold to pay judgements or something of that sort? I was under the impression from reading all of your wordpress posts that he is functionally broke, or will be as soon as his receivership assets are liquidated, he doesn’t have much cash and his remaining significant assets are in receivership for the koestler case (as said by the contempt order that came a few days ago — “His remaining significant assets are under receivership…”, paraphrased), then why would anyone agree to represent him? What do you estimate the cost of his representation is for this matter and his FTC appeal? Do you think he can pay? Just wondering if you have any insight into the mechanics of his representation and how they think they are getting paid. If he pays lawyers hundreds of thousands of dollars while having huge outstanding tax liabilities and judgements to be settled, is that improper in any sense?
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A lot to unpack here… grin!
To be clear, I am speculating (but cannot prove) that Ms. Murphy hasn’t been paid.
None of the lawyers get a first call on proceeds, other than Mr. Abbott, the receiver in the Koestler matter.
And I do think Martin needs counsel, but other than the rug pull, this past summer — I don’t know how he might be paying for… anything.
And the appeal lawyers in FTC ban (2nd Cir.) likely got around $300,000 from the rug pull… if that’s what it was.
So again, he’s close to broke.
My guess would be that Ms, Murphy is owed (or will bill) about $100,000 all in on the contempt hearings and motions.
NY needs to file for liens to get the $1.6 million, in taxes — if it hadn’t already.
In sum… we shall see.
Pop the popcorn!
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