NEW YORK, NY – AUGUST 04: Martin Shkreli, former chief executive officer of Turing Pharmaceuticals AG, center, pauses while speak to members of the media outside federal court in the Brooklyn borough of New York, U.S., on Friday, Aug. 4, 2017 (People: Martin Shkreli Transmission Ref: MNC1 Hoo-Me.com / MediaPunch/IPX). Inset: The one-of-a-kind Wu-Tang Clam album (via court filing).
Martin Shkreli, the disgraced “Pharma Bro” banned from the pharmaceutical industry for life, was ordered by a federal judge Monday to turn over all copies of a rare, unreleased Wu-Tan Clan album.
Cryptocurrency collective PleasrDAO sued Shkreli in July over “Once Upon a Time in Shaolin” — the hip-hop group’s recording that has been called “the world’s rarest album.” The recording was created in secret over six years and designed as a piece of fine art. Only one double-CD set of the recording exists, and it is contained in an engraved nickel-silver box and accompanied by a leather-bound book with 174 parchment pages.
The Wu-Tang Clan sold the recording to Shkreli in 2016 for $2 million, and the terms of the sale mandated that the album could not be released to the public until Oct. 8, 2103. Private viewing and listening sessions would be allowed, however.
Shkreli became a household name after inflating the price of AIDS drug Daraprim by 5,000%. He is also a felon who served over five years in prison for defrauding hedge fund investors. Coincident with Shkreli’s conviction was a $7.4 million forfeiture order that the former pharmaceutical CEO satisfied by turning over the rare album to the federal government.
PleasrDAO then acquired the album in 2021 in a complex and largely confidential deal with the federal government while Shkreli was still in prison.
PleasrDAO sued Shkreli in June, accusing him of copying playing the album in a livestream for his social media followers on June 18, 2022.
According to the complaint, Shkreli said, “Yeah, that’s the Wu-Tang album for all you crazy streamer people,” during the livestream broadcast.
The plaintiff said that in another livestream a few days later, Shkreli was asked if he still had a copy of the album, and he said, “I was playing it on YouTube the other night even though somebody paid $4 million for it.”
PleasrDAO moved for a preliminary injunction requesting that Shkreli relinquish assets relating to the case.
After a hearing Friday, U.S. District Judge Judge Pamela K. Chen issued a brief order that Shkreli must turn over all copies of “Once Upon a Time in Shaolin” to his lawyers by Friday. Chen, a Barack Obama appointee, also said that Shkreli must produce a signed inventory that includes the names and contact details of anyone who received copies of the recording by Sept. 30.
“Plaintiff raises sufficiently serious questions going to the merits of its claims for violation of the Defend Trade Secrets Act, misappropriation of trade secrets, and unjust enrichment,” the order said, noting that the plaintiff “will suffer immediate and irreparable injury if a preliminary injunction is not entered.”
Chen also found that the “balance of the hardships tips decidedly in Plaintiff’s favor” and warned that if Shkreli failed to comply with the order, he could potentially face contempt charges.
Steven Cooper, an attorney for PleasrDAO, said in an email to Law&Crime Tuesday that the ruling was “an important victory” for his client. Cooper noted that PleasrDAO owns the “exclusive rights to the one-of-a-kind Wu-Tang Clan album” that Shkreli was “supposed to have forfeited.”
“We are pleased that Judge Chen recognized that immediate relief was necessary to thwart the continuing bad acts of Mr. Shkreli,” Cooper said.
Shkreli attorney Edward Paltzik, however, called Chen’s ruling “merely a preliminary measure entered by the Court to maintain the perceived status quo before any discovery occurs,” and said it has no bearing whatsoever on the final outcome of the case.”
“Crucially, the Court did not find that PleasrDAO is likely to succeed on the merits or that the DAO’s allegations are true, and instead ruled that Mr. Shkreli’s forthcoming motion to dismiss should proceed without delay,” Paltzik said to Law&Crime in an email Tuesday.
In June 2024, PleasrDAO began selling access to “Once Upon a Time in Shaolin” by charging fans $1 to participate in an “experiment” to test whether people still value music in the digital era. Those who paid the dollar would be given an encrypted digital version of the a five-minute sampler of the album.
PleasrDAO said at the time that it had been working with “the original artists and producers” to release the album and that proceeds would be shared with the Wu-Tang Clan and the album’s producers.
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