NY Attorney General seeks permanent Trump ban, citing Shkreli precedent

3 min read

In a strategic move, the office of New York Attorney General Letitia James has drawn attention to a recent appeals court ruling against Martin Shkreli, linking it to their pursuit of a permanent ban on former President Donald Trump from the state’s real estate industry. The Second U.S. Circuit Court of Appeals upheld a New York federal court’s decision to ban Shkreli for life from the pharmaceuticals industry, citing antitrust concerns related to his drastic price hike of a crucial drug in 2015.

The ruling has become a crucial reference point in AG James’s ongoing lawsuit against Trump in the Manhattan State Supreme Court. The suit alleges widespread and sustained fraud in how Trump, his company, and his two adult sons valued real estate assets to secure more favorable loan terms. AG James seeks a lifetime ban for Trump from the New York real estate industry and proposes a five-year prohibition for his sons, Donald Trump Jr. and Eric Trump, along with a $360 million fine.

In a recent letter to Judge Arthur Engoron, who presided over Trump’s civil business fraud trial, Assistant Attorney General Colleen Faherty informed the court about the Second Circuit’s decision in the Shkreli case. Faherty emphasized the relevance of the Shkreli ruling, which supported the AG’s argument for a comparable ban on Trump in the real estate sector.

The Second Circuit’s decision, which upheld a Manhattan federal court’s order against Shkreli, included a lifetime ban from the pharmaceutical industry and an order to disgorge $64.6 million. Faherty attached an eight-page copy of the ruling to her letter, highlighting its significance as supplemental authority in the ongoing legal proceedings.

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The legal connection between Shkreli and Trump goes back over eight years, when both figures drew public outrage for their controversial statements, with Trump during his presidential campaign and Shkreli for unapologetically raising the price of a life-saving drug by over 4,000%. Trump, at the time of Shkreli’s drug price increase, publicly criticized him, referring to him as a “spoiled brat” and a “zero.” However, Shkreli later endorsed Trump’s candidacy.

During Shkreli’s 2017 securities fraud trial, Texas biotech investor Darren Blanton, allegedly defrauded by Shkreli, testified against him. Blanton, who also served as an advisor to Trump’s presidential transition, provided crucial insights into Shkreli’s actions.

Following Shkreli’s conviction in the summer of 2017, he remained free on bond pending appeal. However, his bail was revoked after he offered a $5,000 bounty on Facebook for a strand of hair from Hillary Clinton. This incident led to his imprisonment, reflecting the controversial nature of Shkreli’s actions even after his initial legal troubles.

The intertwined legal narratives of Shkreli and Trump, now officially linked by the Second Circuit’s ruling, add a new layer to the ongoing legal saga. The AG’s meticulous use of precedent, coupled with the controversial histories of both figures, underscores the complex dynamics at play in the pursuit of justice and accountability. As Judge Engoron reviews the case, the impact of the Shkreli ruling on Trump’s potential ban from the real estate industry remains a focal point, shaping the trajectory of this high-stakes legal battle.

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