Could Law Enforcement Use Civil Forfeiture to Seize Rap Album From Pharma ‘Bad Boy’?
Melissa Quinn /
A sought-after album from the rap group Wu-Tang Clan could wind up in the hands of the federal government following the arrest of the pharmaceutical industry’s “bad boy.”
Martin Shkreli, the ex-CEO of Turing Pharmaceuticals, landed in the news for increasing the price of a life-saving drug from $13.50 a pill to $750 and stayed in the public’s eye after he purchased the lone copy of the album “Once Upon a Time in Shaolin” from rap group Wu-Tang Clan for $2 million—a move that only contributed to his negative reputation.
Now, following his arrest yesterday, Wu-Tang Clan fans and Shkreli haters are wondering if law enforcement could use a little-known legal tool to take the album from the pharmaceutical executive.
Using civil asset forfeiture, state and federal law enforcement officials could seize the Wu-Tang Clan album, but they would first have to connect it to Shkreli’s criminal activity.
“To the extent that they can connect the album to the proceeds of the crime, then they absolutely could,” Andrew Kloster, a legal fellow at The Heritage Foundation, told The Daily Signal.
The federal government, Kloster explained, would have to show that the $2 million Shrkeli used to purchase “Once Upon a Time in Shaolin” is tied to his criminal offenses.
FBI officials arrested Shkreli yesterday on allegations of securities fraud. He pleaded not guilty and was released on a $5 million bail.
“There are many ways he would have to give [the album] up,” Kloster said, “either through civil forfeiture under state and federal law, criminal forfeiture under state and federal law, or restitution claims against him.”
If the government did find that Shkreli used ill-gotten gains to purchase the album—and law enforcement subsequently seized it—the proceeds would likely go into the Justice Department’s asset forfeiture fund, Kloster said.
During a news conference yesterday, U.S. Attorney Robert Capers said law enforcement hadn’t yet seized the Wu-Tang Clan album.
“I wondered how long it was going to take to get to that,” Capers said. “We’re not aware of where he got the funds that he raised to buy the Wu-Tang Clan album.”
The FBI confirmed that the album was not in their custody.
#Breaking no seizure warrant at the arrest of Martin Shkreli today, which means we didn't seize the Wu-Tang Clan album.
— FBI New York (@NewYorkFBI) December 17, 2015
However, court documents suggest that the government is prepared to seek forfeiture of property “derived from proceeds traceable to” his allegations should Shkreli be convicted.
In recent years, law enforcement has gotten a bad reputation for its use of civil forfeiture, which gives them the power to seize property if they suspect it’s tied to a crime. Abuses of the tool have been well documented.
However, Kloster said the government would be using civil forfeiture for its intended purpose if they do seize the Wu-Tang Clan album.
“If it was a case where [civil forfeiture] is appropriate, it’s a case like this where someone steals from someone else and uses the money the purchase something,” Kloster said. “The government should have the ability to take those assets, to liquidate those assets and make them whole.”
Shkreli gained notoriety after he raised the price for the medication Daraprim from $13.50 to $750. His decision, which also landed his company under investigation by the Senate’s Special Committee on Aging, garnered intense backlash from consumers and the media, alike.
Shkreli only fanned the flames when he told attendees at the Forbes Healthcare Summit earlier this month that, if he could’ve done one thing differently, he would’ve raised the price of Daraprim higher.