Mystery buyer of Wu-Tang Clan album forfeited by Martin Shkreli will reveal identity soon, lawyer says

Once upon a time …. the same lawyer who negotiated a mysterious sale of a one-of-a-kind Wu-Tang Clan album forfeited by “Pharma Bro” felon Martin Shkreli was involved in legal issues around that very same hip-hop group and record.

The New York lawyer, Peter Scoolidge, identified himself Tuesday as the person who handled the purchase by an undisclosed buyer, for a likewise secret price, from the U.S. government of the single-copy Wu-Tang Clan record “Once Upon a Time in Shaolin.”

While the purchase amount was not disclosed, prosecutors said the sale covered the balance of a nearly $7.4 million forfeiture judgment Shkreli was ordered to pay in 2018, months after he was convicted in Brooklyn federal court of securities fraud.

In April, the balance of the forfeiture stood at about $2.3 million — or about $300,000 more than what Shkreli reportedly paid for the album when he bought it via an online auction in 2015.

“This was the most interesting deal I have ever worked on,” Scoolidge said in a statement issued to CNBC on Tuesday. He reiterated that the sales contract with the government barred disclosure of the name of the buyer — or buyers.

What Scoolidge did not mention Tuesday was that he previously represented Long Island artist Jason Koza, who sued Shkreli, Wu-Tang Clan co-founder Robert “RZA” Driggs, the album’s co-producer Tarik “Cilvaringz” Azzougarh, and an online auction house in connection with illustrations artwork used in the 174-page leather-bound book that was sold to Shkreli as part of the album.

Nor did Scoolidge mention that he also has in the past represented Azzougarh in connection with the same album.

But Scoolidge told CNBC on Wednesday that Azzougarh had hired him around early 2018 to represent the producer on issues related to Shkreli’s forfeiture of the album.

“Tarik came to know who I was through the first lawsuit and reached out to me,” Scoolidge said.

The lawyer also said Wednesday that the so-far-secret buyer of the album “is going to identify themselves in the future, I’d say in the next 30 to 60 days.”

But Scoolidge’s involvement in the album sale, and his past history of Wu-Tang Clan-related issues involving the same record, raise the question of whether the group or individual members of it were involved in the purchase of their album back from the government.

Scoolidge declined to comment on that possiblity.

A spokesman for the Wu-Tang Clan did not immediately respond to requests for comment on the sale of the album, or on the question of whether members of the group were involved in the latest purchase from the government.

“Once Upon a Time in Shaolin” is not just a record album, one of which only a single copy exists.

It’s also considered a piece of artwork, and a very weird piece of intellectual property.

The two-CD album, which reportedly took six years to produce, features Cher, among other guests. Much of the album was produced in Marrakech, Morroco, where Azzougarh lives.

The album was sold encased in a silver box featuring a wax seal of the Wu-Tang Clan, as well as the leather-bound book containing liner notes.

Azzougarh, at the time of the announced sale of the album by the on-line auction house Paddle8, noted that the terms of the sale would bar its buyer from releasing the record commercially for decades. Many decades.

“After 88 years the copyright, which includes public and commercial rights, automatically transfers to the owner of the work,” he told Forbes in 2015.

“However, it will still be his or her choice at that [point] to release it or not release it.”

Shkreli was outed as the secret buyer of the album in a Bloomberg Businessweek article in late 2015.

Months earlier, he had become nationally infamous with his decision, as CEO of the drug firm then known as Turing Pharmaceuticals, to hike the price of an anti-parasite medication used by HIV patients, newborns and pregnant women by more than 5,000 percent.

Shkreli doubled down on the controversy by mercilessly trolling people on Twitter, and backing then-presidential candidate Donald Trump, saying that he would release “Once Upon a Time in Shaolin” for free to the public if Trump were elected.

Shkreli, who has a history of lying, ended up streaming only short portions of the album online after Trump won the 2016 election.

Earlier, in February 2016, Koza, with Scoolidge as his lawyer, filed suit in Manhattan federal court against Shkreli, RZA, Azzougarh and Paddle8, alleging copyright infringement in the use of his illustrations in the book accompanying the album.

Koza said that his drawings of Wu-Tang Clan members had been uploaded to a fan site devoted to the group, and then were used in the book without his permission.

Scoolidge told Reuters at the time that Shkreli “didn’t need to know” that Koza’s art was used without permission.

“There is no intent requirement for copyright infringement,” Scoolidge said then.

Within two months, Shkreli had been dropped as a defendant in the lawsuit.

Scoolidge told Billboard, “We stipulated to drop the case against Mr. Shkreli for the time being because he is apparently indemnified by other parties in the case.”

Shortly after that, Koza voluntarily dismissed his claims against the RZA, Azzougarh and Paddle 8, without giving a reason in a court filing. Scoolidge signed that dismissal notice.

Scoolidge on Wednesday declined to answer why the lawsuit was dropped.

In 2017, Shkreli was convicted of securities fraud related to two hedge funds that he drove into the ground, and the first drug company that he had founded, then known as Retrophin.

In 2018, he was sentenced to seven years and prison, and ordered to forfeit to the U.S. government a number of assets, including the Wu-Tang Clan album.

After the forfeiture order was filed, an article in Forbes detailed the legal issues created by the order, and identified Scoolidge as the lawyer for album producer Azzourgarh

That article noted “the most fascinating question that now arises is the legality of seizing a work still owned in part by Tarik ‘Cilvaringz’ Azzougarh and Robert ‘RZA’ Diggs, producers of the Wu-Tang album.”

“In addition to holding 50% of the master recording, they also stipulated that the album’s buyer couldn’t sell it until 88 years after the purchase,” Forbes wrote.

The article then quoted Scoolidge.

“The contract the album was sold under requires Mr. Shkreli to bind any new taker of the album to all of the same terms it was sold under,” Scoolidge.

“If and when that happens, my client [Azzougarh] could file papers in the forfeiture proceeding to enforce the restrictions on use of the album.”

Scoolidge told The Wrap in March 2018, “My client’s intent is to maintain the status quo with regard to the album … that it’s not to be sold commercially.”

“Whoever takes it has to abide under the same terms under which it was sold originally,” the lawyer said.

CNBC’s Jim Forkin contributed to this report.