Legal News

?I?m Not a Doctor, I Just Played One on the Phone.?

By Ashby Jones

Looking to avoid the indignity of a high-profile SEC lawsuit? Here’s one way to try to do it: pretend you’re sick. Really sick. Stage-3-colorectal-cancer sick. Forge a letter and an affidavit from a doctor and have your lawyers present it to the judge. To convince your own lawyers of the situation, just call them up, pretending to be your own doctor. If you’re lucky, the judge will dismiss the suit and life can just go on. Someday, you’ll look back and have a laugh.

But if you’re unlucky, you’ll get caught, and life will suddenly get much, much worse. It all happened to Howard Richman, the former senior VP of regulatory affairs at Biopure Corp., a Cambridge, Mass., biotech company. On Wednesday, Richman admitted that he had concocted an elaborate cancer ruse and lied to a federal judge and to his own lawyers in order to dodge an SEC suit. He pleaded guilty to one count of obstruction of justice. He faces up to 10 years in prison. Here’s the story from the Boston Globe.

The backstory, according to the Globe: In 2003, Biopure made a series of public statements that suggested the development of a synthetic blood substitute, called Hemopure, was moving along when, in fact, the Food and Drug Administration had rejected the company’s clinical trials.

Two years later, the SEC filed a federal lawsuit over the matter. The civil suit named Biopure, Richman, and three other executives as defendants. All but Richman settled the claims without a trial, with the individuals paying fines ranging from $40,000 to $120,000.

But Richman refused to settle, ultimately reporting that he had cancer and was too sick to participate in any pretrial proceedings. Prosecutors said Richman gave his lawyers a letter purportedly from his physician, saying Richman had been diagnosed with Stage 3 colorectal cancer and that he was being treated with surgery and chemotherapy.

Assistant US Attorney James P. Dowden said on Wednesday that Richman pretended to be his own doctor in the phone conversation. In 2007, his lawyers gave Saris an affidavit purportedly from his doctor that said his cancer had worsened and that he could not withstand the stress of the lawsuit, according to the indictment.

Saris canceled the pending trial against Richman in July 2007 and effectively ended the litigation.

Richman testified at a brief hearing on Wednesday, but reportedly gave no explanation for his actions. “I’m changing my plea from not guilty to guilty for the crime that I committed.”

Full post as published by Law Blog - WSJ.com on March 12, 2009 (boomark / email).