1

22-728

Federal Trade Commission, et al. v. Shkreli

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A 

SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS 

GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S 

LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH 

THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN 

ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING 

A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY 

COUNSEL. 

1 At a stated term of the United States Court of Appeals for the Second Circuit, held at the 

2 Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 

23rd 3 day of January, two thousand twenty-four.

4

5 PRESENT:

6 BARRINGTON D. PARKER,

7 MYRNA PÉREZ,

8 SARAH A. L. MERRIAM,

9 Circuit Judges.

10 _____________________________________

11

12 Federal Trade Commission, State of New York, 

13 State of California, State of Ohio, Commonwealth 

14 of Pennsylvania, State of Illinois, State of North 

15 Carolina, Commonwealth of Virginia,

16

17 Plaintiffs-Appellees,

18

19 v. No. 22-728

20

21 Martin Shkreli, individually, as an owner and 

22 former director of Phoenixus AG and as a former 

23 executive of Vyera Pharmaceuticals, LLC,

24

25 Defendant-Appellant,

26

27 Vyera Pharmaceuticals, LLC, Phoenixus AG, 

28 Kevin Mulleady, individually, as an owner and 

29 director of Phoenixus AG and as a former 

30 executive of Vyera Pharmaceuticals, LLC,
2

1 Defendants.

2 _______________________________________

3 FOR PLAINTIFF-APPELLEE

4 FEDERAL TRADE COMMISSION: BRADLEY D. GROSSMAN, Attorney, Federal 

5 Trade Commission, Washington, D.C.

6

7 FOR STATE PLAINTIFFS-APPELLEES: PHILIP J. LEVITZ, Assistant Solicitor General, for

8 Letitia James, Attorney General for the State of 

9 New York, for the State Appellees.

10

11 FOR DEFENDANT-APPELLANT: KIMO S. PELUSO (Noam Biale, on the brief), 

12 Sher Tremonte LLP, New York, NY.

13

14 Appeal from a judgment of the United States District Court for the Southern District of 

15 New York (Cote, J.).

16 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND 

17 DECREED that the February 4, 2022, judgment of the district court is AFFIRMED. 

18 Plaintiffs-Appellees Federal Trade Commission (“FTC”); the commonwealths of 

19 Pennsylvania and Virginia; and the states of California, Illinois, New York, North Carolina, and 

20 Ohio filed suit against Defendant-Appellant Martin Shkreli and others in the United States 

21 District Court for the Southern District of New York. Plaintiffs-Appellees alleged violations of 

22 federal and state antitrust laws for conduct involving the distribution of Daraprim, a brand-name 

23 drug used to treat a parasitic infection called toxoplasmosis. Shkreli’s co-defendants settled 

24 before trial.

25 Following a seven-day bench trial, the district court found that Plaintiffs-Appellees 

26 carried their burden of establishing that Shkreli committed antitrust violations. The district court 

27 issued a final judgment that, among other things: (1) ordered disgorgement against Shkreli 

28 jointly and severally with defendant Vyera; and (2) entered a permanent injunction imposing a 

29 lifetime ban on Shkreli from the pharmaceutical industry. This appeal followed.
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1 For the reasons set forth below, we affirm. We assume the parties’ familiarity with the 

2 underlying facts, the procedural history of the case, and the issues on appeal, which we reference 

3 only as necessary to explain our decision.

4 I. Disgorgement 

5 Shkreli argues for the first time on appeal that the district court erred by relying on 

6 federal law remedies in imposing joint and several disgorgement on him under New York law. 

7 Though Shkreli does not dispute that New York law allows for disgorgement relief, he contends 

8 that New York law precludes disgorgement on a joint and several basis. Shkreli never made this 

9 argument to the district court, and he proffers no reason now for his failure to raise the arguments 

10 there. Additionally, in the district court, Shkreli himself relied exclusively on federal equity 

11 jurisprudence in contending that he should not be ordered to disgorge profits. See Dist. Ct. ECF 

12 No. 462 at 4-6; see also Dist. Ct. ECF No. 860 at 1234-35 (Shkreli’s trial counsel arguing “in 

13 terms of equitable monetary relief, your Honor, the Liu [v. SEC, 140 S. Ct. 1936 (2020),] case 

14 from the Supreme Court says that disgorgement should not be a joint and several remedy”). 

15 Therefore, the circumstances here do not persuade us that we should exercise our discretion to 

16 address this new argument on appeal. See Greene v. United States, 13 F.3d 577, 586 (2d Cir. 

17 1994) (“Entertaining issues raised for the first time on appeal is discretionary with the panel 

18 hearing the appeal.”); see also Doe v. Trump Corp., 6 F.4th 400, 410 (2d Cir. 2021). Given his 

19 strategic decision in the district court, there is no injustice to Shkreli by us declining to address 

his new argument.

1 20 

21

1 Even if this argument were not waived, it would still fail. We do not read Shkreli’s principal case, J.P. Morgan 

Sec. Inc. v. Vigilant Ins. Co., 37 N.Y.3d 552 (N.Y. 2021), to hold that joint and several disgorgement relief is 

unavailable against codefendants engaged in concerted wrongdoing to wrongfully obtain profits under New York 

equity jurisprudence.
4

1 II. Permanent Injunction 

2 Next, Shkreli provides three unpersuasive reasons to disturb the district court’s entry of 

3 the permanent injunction in this case.

4 First, Shkreli contends that the district court abused its discretion by entering an

5 overbroad injunction against him that imposes a lifetime ban from the pharmaceutical industry. 

6 Second, Shkreli argues that the injunction unconstitutionally limits his public speech. Third, 

7 Shkreli asserts that the injunction is not specific enough and that it thus violates Federal Rule of 

8 Civil Procedure 65(d). We address each argument in turn below.

9 First, we note that Section 13(b) of the Federal Trade Commission Act authorizes the 

10 FTC to bring actions seeking injunctive relief for violations of the Act. See 15 U.S.C. § 53(b). 

11 Section 13(b) imposes prospective, not retrospective, relief. See AMG Cap. Mgmt, LLC v. FTC, 

12 141 S. Ct. 1341, 1347-48 (2021). Upon a proper showing, a district court may issue a permanent 

injunction. See id.

2 13 

14 In general, a district court has broad discretion in framing an injunction in terms it deems 

15 reasonable to prevent wrongful conduct. See Seibert v. Sperry Rand Corp., 586 F.2d 949, 951 

16 (2d Cir. 1978). Appellate review of the terms of the injunction is limited to whether there has 

17 been an abuse of that discretion. See SEC v. Posner, 16 F.3d 520, 521-22 (2d Cir. 1994). A 

18 district court has abused its discretion if it: (1) based its ruling on an erroneous view of the law, 

19 (2) made a “clearly erroneous factual finding,” or (3) rendered a decision that “cannot be located 

20 within the range of permissible decisions.” SEC v. Dorozhko, 574 F.3d 42, 45 (2d Cir. 2009) 

21 (internal citations and quotation marks omitted). 

2 The Donnelly Act was modeled on the federal Sherman Act of 1890, and thus should generally be construed 

considering federal precedent. See People v. Rattenni, 81 N.Y.2d 166, 171 (1993). 
5

1 We conclude that the district court did not abuse its discretion by imposing a lifetime ban 

2 from the pharmaceutical industry on Shkreli because an injunction of that scope was within the 

3 range of permissible decisions. The district court found, and Shkreli does not dispute, that 

4 Shkreli’s illegal scheme was “egregious, deliberate, repetitive, long-running, and ultimately

5 dangerous.” Special App’x at 140. The district court found that Shkreli’s comprehensive and 

6 effective scheme led to the price increase of a life-saving drug, Daraprim, from $17.50 to $750 

7 per tablet and successfully blocked the entry of generic drug competition to maintain Daraprim’s 

8 inflated price. The district court further found that Shkreli’s scheme was far-reaching and was 

9 implemented using many means. It pointed to the record demonstrating that Shkreli facilitated

10 extensive research; established at least two companies; recruited and worked through others even 

11 while in prison; and took advantage of regulatory requirements designed to safeguard the 

12 pharmaceutical industry to carry out his illegal scheme.

13 The district court’s injunction was a reasonable measure to protect the public from the

14 risk of recurring anticompetitive conduct in the pharmaceutical industry by Shkreli. In his direct 

15 written testimony, Shkreli indicated that after release from prison, “[i]f I do pursue employment 

16 within the pharmaceutical industry... I hope to continue playing a role in the discovery of cures 

17 and treatments for rare and life-threatening diseases... and focus on experimental and research18 based opportunities related to discovery of new medicines and new uses for existing medicines.” 

19 App’x at 801. Given Shkreli’s pattern of past misconduct, the obvious likelihood of its 

20 recurrence, and the life-threatening nature of its results, we are persuaded that the district court’s 

21 determination as to the proper scope of the injunction was well within its discretion.

22 Shkreli fares no better in his challenge to Paragraph II(D) of the permanent injunction. 

23 Shkreli argued in the district court that imposing Paragraph II(D) without limits would infringe
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1 his free speech rights by prohibiting him entirely from, among other things, using social media to 

2 discuss the pharmaceutical industry. In response to Shkreli’s concerns, the record reflects that 

3 the district court added the following text to Paragraph II(D): 

4 Shkreli’s public statements about a Pharmaceutical Company will be 

5 deemed an action taken to influence or control the management or business 

6 of any Pharmaceutical Company if Shkreli intended the statement to have 

7 that effect or if a reasonable person would conclude that the statement has 

8 that effect. 

9

10 Special App’x at 166. 

11 The district court added this language to set limitations in light of Shkreli’s concerns,

12 while also enjoining possible future antitrust violations. In light of that addition, we are 

13 persuaded that Paragraph II(D)’s public statement ban is in the range of permissible decisions,

14 preventing possible future antitrust violations without treading on Shkreli’s free-speech rights. 

15 See Nat’l Soc’y. of Pro. Eng’rs v. United States, 435 U.S. 679, 697-98 (1978) (“In fashioning a 

16 remedy, the District Court may, of course, consider the fact that its injunction may impinge upon 

17 rights that would otherwise be constitutionally protected, but those protections do not prevent it 

18 from remedying the antitrust violations.”); see also Jews for Jesus, Inc. v. Jewish Cmty Rels.

19 Council of N.Y., Inc., 968 F.2d 286, 296 (2d Cir. 1992) (“[T]he First Amendment provides no 

20 defense to persons who have used otherwise protected speech or expressive conduct to force or 

21 aid others to act in violation of a valid conduct-regulating statute.”). 

22 Lastly, we conclude that the terms of the district court’s injunction are sufficiently clear, 

23 specific in terms, and described in reasonable detail to satisfy Federal Rule Civil Procedure

24 65(d). We review de novo whether the injunction complies with Rule 65(d). See City of New 

25 York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 143 (2d Cir. 2011). “To comply with the 

26 specificity and clarity requirements” of Rule 65(d), “an injunction must be specific and definite 
7

1 enough to apprise those within its scope of the conduct that is being proscribed.” S.C. Johnson 

2 & Son, Inc. v. Clorox Co., 241 F.3d 232, 240-41 (2d Cir. 2001) (quotation marks omitted); see 

3 also Fed. R. Civ. P. 65(d)(1). Shkreli contends that the injunction is vague because it lacks 

4 definitions for two of its key terms: “participating” in the pharmaceutical industry and 

5 “pharmaceutical industry.” But the district court was not required to define unambiguous terms. 

6 Terms of an injunction are construed “according to the general interpretive principles of contract 

7 law.” Mastrovincenzo v. City of New York, 435 F.3d 78, 103 (2d Cir. 2006). Therefore,

8 undefined terms should be given their plain meaning and construed in light of normal usage. See 

9 id. 

To be sure, “participating” is “taking part” in an undertaking.

3 10 In this case, the 

11 undertaking is the pharmaceutical industry. And the district court’s injunction, read in context, is 

12 sufficiently clear to put Shkreli on notice as to what the “pharmaceutical industry” consists of. 

13 The injunction even defines Pharmaceutical Company, and Pharmaceutical Companies 

14 undoubtedly make up the pharmaceutical industry. Therefore, the plain language is hardly 

15 vague. It squarely forbids Shkreli from directly or indirectly taking part in any manner in the 

16 pharmaceutical industry, including taking any action to directly or indirectly influence or control 

the management or business of any Pharmaceutical Company.

4 17 

18 The language of the permanent injunction requires Shkreli to notify the Plaintiffs19 Appellees if he wishes to accept “Qualified Employment” in order to provide an opportunity to 

20 object. See Special App’x at 166-67. As the district court made clear, if Shkreli feels that the 

3 Merriam-Webster Online Dictionary, https://perma.cc/W6FM-G5PC (last visited January 5, 2024). 4 The injunction contains a few exceptions: “Shkreli may retain an Ownership Interest in securities that are under the 

control of the receiver appointed in Koestler v. Shkreli, 1:16cv7175;” and may accept “Qualified Employment”

“with a Pharmaceutical Company that is not primarily involved in the research, Development, manufacture, 

commercialization, or marketing of Drug Products or [active pharmaceutical ingredients] and” derives less than 10% 

of its gross revenues from such activity. Special App’x at 165-66 (emphasis added).
8

1 Plaintiffs-Appellees have unreasonably objected to appropriate employment, he may apply for 

2 relief. See Pasadena City Bd. of Educ. v. Spangler, 427 U.S. 424, 437 (1976) (“[S]ound judicial 

3 discretion may call for the modification of the terms of an injunctive decree if the circumstances, 

4 whether of law or fact, obtaining at the time of its issuance have changed, or new ones have since 

5 arisen.”) (quoting Sys. Fed’n No. 91, Ry. Emps.’ Dep’t v. Wright, 364 U.S. 642, 647 (1961)). 

6 * * *

7 We have carefully considered Shkreli’s remaining arguments and find them to be without 

8 merit. For the foregoing reasons, we AFFIRM the judgment of the district court. 

9

10

11 FOR THE COURT: 

12 Catherine O’Hagan Wolfe, Clerk of Court