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Feds Skewer Fishman’s Attempt to Avoid $13.5M Forfeiture

Federal prosecutors told a judge Friday that convicted veterinarian Seth Fishman's recent claim of illegality regarding the $13.5 million forfeiture imposed upon him “is predicated on a number of unfounded and easily disprovable presumptions.”

Fishman, who is currently imprisoned in Florida but appealing his 11-year sentence for two felony drug-supplying convictions in a decades-long international racehorse doping conspiracy, had stated in a Sept. 12 filing that the forfeiture order signed by the judge back on July 11 “is not authorized by statute and is therefore unlawful in its entirety.”

A response filing Sept. 30 by the legal team that successfully prosecuted Fishman stated that, “In arguing that the Food, Drug, and Cosmetic Act (FDCA) does not authorize forfeiture, the defendant elevates form over substance, ignores past precedent, and, in so doing, deliberately misreads the FDCA and several applicable forfeiture provisions to reach the defendant's desired outcome of avoiding forfeiture altogether.”

The filing by the feds also noted that at the time of his sentencing, “then-counsel for Seth Fishman contended that he wished to contest the amount of the forfeiture money judgment, not the basis for forfeiture itself.”

But shortly after his sentencing date, Fishman hired a new lawyer who now “wishes to revisit the availability of forfeiture entirely.” That new legal tactic has no merit, prosecutors contended.

“The defendant's strained reading of the law provides no support for his view that forfeiture is 'unlawful' in this case,” the government attorneys wrote.

Forfeiture “is lawful and mandatory; consequently the Court's forfeiture order entered at Fishman's sentencing should be left undisturbed,” the prosecutors wrote.

“The defendant argues in passing that the Government has not demonstrated that Fishman 'actually acquired' any forfeitable property,” the feds wrote. “The evidence that Fishman, the owner-operator of [the drug company] Equestology, controlled the adulterated and misbranded drugs subject to the forfeiture action is undisputable. So long as the defendant had control over the forfeitable property, which he did, he has acquired that property…”

Fishman had argued otherwise, writing in the Sept. 12 filing that “Misbranding is not a forfeiture crime. The misbranding statute under which the government seeks forfeiture against Dr. Fishman…only permits the government to confiscate the misbranded or adulterated products themselves and any equipment used to manufacture those products.”

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Giannelli Appeals Conviction, 3 1/2-Year Sentence

Lisa Giannelli, who was sentenced to 3 1/2 years in prison Sept. 8 after being found guilty of peddling purportedly performance-enhancing drugs as a years-long protégé under the recently convicted drug-dealing veterinarian Seth Fishman, filed a formal notice of appeal for both her conviction and sentence in federal court Sept. 21.

Giannelli, 56, of Dalton, Delaware, was also ordered to pay a fine of $100,000 and to forfeit $900,000.

“This was not a one-time thing,” Judge Mary Kay Vyskocil of U.S. District Court (Southern District of New York) said at the time of sentencing. “For 18 years, Ms. Giannelli marketed and sold what she knew were illegal and powerful performance-enhancing drugs.”

Fishman, who was sentenced to 11 years in prison on July 11 after two felony drug-supplying convictions in a decades-long international racehorse doping conspiracy, has also appealed his conviction and penalties.

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Fishman Claims $13.5M Forfeiture is ‘Unlawful in its Entirety’

The veterinarian Seth Fishman, who is currently imprisoned but appealing his 11-year sentence for two felony drug-supplying convictions in a decades-long international racehorse doping conspiracy, has filed legal paperwork objecting to the $13.5-million forfeiture that was also imposed upon him, claiming the judge's order was illegal.

“The forfeiture sought here is not authorized by statute and is therefore unlawful in its entirety,” Fishman's attorney, Steven Kessler, stated in a Sept. 12 filing in United States District Court (Southern District of New York).

“The Preliminary Order of Forfeiture (POF) seeks a money judgment equal to the alleged value of the misbranded or adulterated products that form the basis for the criminal charges,” the filing continued. “It further seeks an order forfeiting substitute assets–i.e., property having no relationship to any criminal activity–up to the value of the money judgment.

“[But] the [relevant] statute does not authorize a money judgment equal in value to the misbranded products. Nor does it authorize the forfeiture of substitute assets if the misbranded products are no longer available….” the filing stated.

“Thus, the government's statutory remedy for the manufacture or introduction into interstate commerce of misbranded or adulterated products is limited to the confiscation of the products themselves. The POF exceeds and contravenes the statute. It is therefore unlawful and must be rejected….

“If the POF actually sought 'forfeiture…of any and all drugs that were adulterated or misbranded by the Defendant' for introduction into the stream of interstate commerce, the POF would be lawful….” Fishman's filing stated.

“Misbranding is not a forfeiture crime. The misbranding statute under which the government seeks forfeiture against Dr. Fishman, 21 U.S.C. § 334, only permits the government to confiscate the misbranded or adulterated products themselves and any equipment used to manufacture those products. Nothing more,” the filing stated.

Fishman's filing further argued that “Congress has prescribed monetary penalties for introducing misbranded and adulterated products into the stream of interstate commerce. Those penalties, however, are fines, not forfeitures of proceeds,” and are capped at $1 million for certain violations.

Fishman was indeed fined $250,000 after prosecutors introduced evidence showing that his drug-peddling business earned millions of dollars a year. Fishman is also jointly responsible for $25 million in restitution along with other convicted co-conspirators. Neither of those monetary orders were questioned in Fishman's formal objection to the forfeiture.

The filing continued: “On a few occasions, a court has permitted forfeiture of proceeds or facilitating property or a money judgment forfeiture where there is an allegation of a misbranding violation. Those decisions, however, permitted such relief based on other criminal charges, bundled with the misbranding violations, that specifically authorize forfeiture, such as wire fraud or money laundering, none of which were even alleged against Dr. Fishman, let alone proven, here.”

In summation, the filing stated, “It has never been alleged or shown that Dr. Fishman 'actually acquired' any tainted property as a result of any crime, let alone more than $13 million.”

A separate legal filing from Sept. 8 noted that Fishman has been in transit within the federal prison system from New York to Florida, and that because of COVID-19 restrictions related to his movement, his attorney has been largely unable to speak with him.

“He has [been in transit to] Philadelphia and Tallahassee (and possibly other venues) before arriving [Sept. 7] in Miami. As the Court knows, upon reaching each facility, a prisoner is quarantined and must go through strict COVID protocols before being permitted phone privileges, even with his counsel.

“Because of this, I have been able to speak to Dr. Fishman just once while he was in transit, and that call was brief. We have made substantial efforts to speak with him since, but, through no fault of mine or the Bureau of Prisons, that has not yet happened. I am hopeful that, now that Dr. Fishman has arrived at his destination, communication will be easier to facilitate,” the Sept. 8 filing stated.

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Giannelli Gets Three and a Half Years in Prison

Lisa Giannelli was sentenced Sept. 8 to 3 1/2 years in prison as part of the federal government's sweeping investigation into horse doping at race tracks across the country.

Giannelli, 56, was found guilty of peddling illegal performance-enhancing drugs to trainers to dope horses and faced a maximum of five years in prison. Her lawyers appealed for a no-jail sentence of probation.

“This was not a one-time thing,” Judge Mary Kay Vyskocil said in U.S. District Court in New York. “For 18 years, Ms. Giannelli marketed and sold what she knew were illegal and powerful performance-enhancing drugs.”

Vyskocil said that with its verdict, the jury had rejected Giannelli's argument that she didn't know that what she was doing was illegal when she worked for Equestology, a Florida company owned by veterinarian Seth Fishman.

Giannelli, of Dalton, DE, was also sentenced to two years of supervised release after she gets out of prison. She was also ordered to pay a fine of $100,000 and to forfeit $900,000.

The government's investigation into the illegal use of PEDs to dope horses led to charges against 31 individuals. Since the charges were announced 30 months ago, Giannelli and Fishman have been convicted by juries, and 22 others have pleaded guilty. Fishman was sentenced in July to an 11-year prison sentence.

Those who have pleaded guilty include trainer Jorge Navarro. He was sentenced to five years in prison.

Trainer Jason Servis was also charged and is awaiting a trial scheduled to begin in New York in January.

Prosecutors said Fishman had designed PED to increase a horse's performance and endurance by building red blood cells and masking pain. The substances were designed to avoid showing up in post-race tests conducted by racing regulators.

At the sentencing, Prosecutor Sarah Mortazavi said Giannelli's actions on behalf of Fishman's company warranted the maximum sentence.

“Her criminal conduct touched hundreds of trainers and led to the doping of thousands of horses,” she said.

She said Giannelli has yet to really accept responsibility for her actions and that it was only after the jury's verdict that Giannell offered a “mealy-mouthed explanation for her conduct.”

Giannelli came to court with 13 supporters. Among them was a man she married while under indictment and his mother.

“It was never my intention to break the law,” Giannelli said.

She said that her arrest and conviction have left her life shattered.

“It was never my intention to hurt anyone or to hurt any animal,” Giannelli said. “Everything in my world now is upside down.”

“At this point I wish I had never met Fishman,” she said.

“I thought I was doing good,” she added. “I never knew it was not legal.”

Defense lawyers pleaded for a sentence of probation in court papers that detailed Giannelli's troubled upbringing and her abusive relationships with men. She said she obtained a license to train horses at harness tracks. She said she met Fishman in 2004 and became his sales representative.

Lawyer Alex Huot said Giannelli was not doing anything she wasn't instructed to do by the doctor.

“She took Dr. Fishman at his word,” Huot said.

But Vyskocil told Giannelli she should have known better because the conduct she engaged in occurred when she was an adult.

The judge said Equestology's PEDs were powerful substances that she believed could have and did kill horses.

Vyskocil said that in fashioning her sentence took into account Giannelli's background, her character, and more than 50 letters from Giannelli's family and friends.

“The letters all reflect that you are a kind person, and have a passion to make things better,” the judge said.

At the end, she told Giannelli that she was sorry for her, for the situation that brought her to court.

“I do believe you are a good person,” the judge said. “You have your whole life ahead of you.”

Giannelli's surrender date is Jan. 9, 2023.

The Thoroughbred industry's leading publications are working together to cover this key trial.

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