A former lawyer for Martin Shkreli’s companies might be heading to prison after a jury convicted him of conspiring with the former biotech executive to defraud investors.
Evan Greebel, who advised companies including Retrophin Inc., was found guilty Wednesday of helping Shkreli steal $11 million to pay back investors after the hedge-fund-manager-turned-drug-executive lost their money in risky trades.
Greebel was expressionless as the verdict was read in federal court in Brooklyn, N.Y. His wife, sitting in the gallery, burst into tears.
Shkreli, who was convicted in August of defrauding investors, is being held in prison while he awaits sentencing. He was ousted from Retrophin in September 2014 and went on to found Turing Pharmaceuticals, where he incited public outrage by jacking up the price of a life-saving drug more than 5,000%. Four months later, in December 2015, he was arrested and charged with fraud.
Greebel was tried separately from Shkreli.
Greebel’s defense lawyers were able to dig up more dirt on the witnesses to impugn their credibility, including an admission from an accountant, testifying about an alleged fraud, that he had engaged in his own possible ethical breach by making a $200,000 loan off the books to another client. Defense lawyers also accused a former Retrophin employee, testifying about questionable transactions, of engaging in cybercrimes to gather evidence. A lawyer advised him not to answer those questions on grounds of his privilege against self-incrimination.
Greebel was a corporate lawyer at Katten Muchin Rosenman, and he advised Retrophin as outside counsel. Current Retrophin Chief Executive Steve Aselage and former Chairman Steve Richardson alleged that Greebel appeared to show more loyalty to Shkreli than to the company, including by advising him about the terms of his employment agreement when the board was in the process of ousting Shkreli in late 2014.
Emails also showed the young executive berating Greebel, calling him and his colleagues “lazy and stupid and paid too much.” Prosecutors alleged that Greebel showed deference to Shkreli and “hatched a plan” with him to engage in fraud.
Other lawyers who worked with Greebel, testifying for the defense, said that he was a talented attorney and that Shkreli was a just a difficult client. Witnesses for Greebel said that they believed the consulting agreements were legitimate.
Greebel was convicted of conspiracy to commit wire fraud for helping Shkreli steal from Retrophin and conspiracy to commit securities fraud for helping Shkreli manipulate company shares.
Smythe writes for Bloomberg.