Page 384 - The Case Lab Book

He comments on shares, drug
companies’ performance and

‘shorting’

In his latest tweet he has offered

the chance to slap/punch him in
the face for a donation.

Shkreli was raised in the Sheepshead Bay section of Brooklyn by
immigrant, working class parents from Albania and Croatia. He attended

Hunter College High school in Manhattan, a secondary school for gifted
students, and then graduated from New York’s Baruch College in 2004.

At 17, he began his first internship at Cramer Berkowitz & Co, the hedge
fund founded by television personality Jim Cramer. Shkreli got to know a

small group of investors who focused on shorting stocks. However, he was
accused of trying to manipulate FDA regulations on drug companies whose
stocks he was shorting according to Gawker (1).

“After four years at Cramer Berkowitz, he moved on to jobs at UBS and
Intrepid Capital Management before starting his own hedge fund in 2006.

Elea Capital Management, by his own description, wasn’t terribly
successful. In 2007, Lehman Brothers sued Elea in New York state court
for failing to cover a “put option transaction” in which Shkreli bet the wrong
way on a broad market decline. When stocks rose, Shkreli didn’t have the

funds to make the bank whole. In October 2007, Lehman won a $2.3
million default judgment against Shkreli and Elea. The following year,
however, Lehman imploded. No one ever demanded the $2.3 million,

Shkreli says, adding, “I would make them whole now if they wanted.”’ (2)