The Federal Trade Commission and seven states asked a Manhattan federal judge on Tuesday to hold Martin Shkreli in contempt for allegedly violating the lifetime ban from the pharmaceutical industry that a court imposed on him in 2022. The filing says he “flagrantly and repeatedly violated” that order by publicly trading in at least 60 pharmaceutical stocks since his release from prison in May 2022, and by broadcasting his opinions about drug companies on YouTube, X, and Reddit. The FTC wants him divested of any pharma holdings, fined an amount equal to his trading profits without the ability to offset losses, and subjected to “escalating consequences” for future violations, including possible incarceration.
I want to resist the easy reading here, which is that this is a story about one unusually obnoxious man. It is not. It is a story about what happens when a legal system that prizes individual culpability meets an industry whose pathologies are structural. Shkreli hiked Daraprim from $17.50 to $750 a tablet, a maneuver the courts eventually classified as an anti-competitive scheme at Vyera Pharmaceuticals, and the remedy was, characteristically, personal: a lifetime ban, $64 million in disgorgement, upheld by the Second Circuit in January 2024, with the Supreme Court declining to hear his appeal last October. And then the man walked out of prison and, per the filing, simply resumed the behavior, this time from the commentary side of the market.
The literature on deterrence is fairly clear on this point, and it is a point I confess some exhaustion at having to repeat: a prohibition enforced only against its most famous violator is not enforcement, it is theater with a docket number. FTC Commissioner Mark Meador put it with uncharacteristic economy for a regulator: “A lifetime industry ban is only effective if breaches are met with consequences commensurate with the seriousness of the order.” One hopes the commission applies that principle with equal enthusiasm to the executives who never livestreamed anything, who raised prices quietly, in boardrooms, and who will never appear in a contempt filing because their lawyers drafted around the injunction before breakfast.
Note, too, the detail that the filing asks the court to order Shkreli’s sister, Leonora Izerne, and his partner, Chelsea Voss, to preserve evidence. This is how contempt litigation actually works: not as a clean confrontation between state and scofflaw, but as a widening circle of preservation orders, document demands, and family members drawn into orbit. The system does not punish so much as it metabolizes.
The states joining the filing are New York, California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia, which is a genuinely bipartisan roster, and I mention that not to congratulate anyone but to observe that even attorneys general who agree on nothing else can agree that a man who turned a sixty-year-old anti-parasitic into a $750 status symbol has exhausted the benefit of the doubt. The doubt was never that generous to begin with.
What the contempt request proposes is interesting, though, and here I must complicate my own complication. The demand that Shkreli disgorge profits “without the ability to account for offsetting losses” is a punitive asymmetry, and punitive asymmetries are precisely what appellate courts exist to scrutinize. If Judge Oetken, or whichever judge draws this, crafts the sanction too aggressively, the Second Circuit may hand Shkreli the procedural victory he could never win on the merits. The remedy must be commensurate, as Meador says, but commensurate is a word lawyers bill by the hour.
Still, the underlying facts are not complicated. A court said: never again. The record, as alleged, says: again, at least sixty times, on camera, with an audience. The correct response is not fascination. It is a fine, a divestment, and a very clear message that lifetime means lifetime.