Conviction of Silk Road Founder Ross Ulbricht Affirmed

MANHATTAN (CN) — In a blockbuster appeal late last year, attorneys for Silk Road founder Ross Ulbricht prompted New York’s Second Circuit to question the justice of sending a young man to die behind bars because he created an underground narcotics website.

That sympathy dried up Wednesday, however, as the three-judge panel upheld life imprisonment for the man behind the deep-web drug bazaar.

Toward the end of a mammoth 139-page ruling, U.S. Circuit Judge Gerard Lynch emphasized that he and his colleagues appreciated the gravity of their decision.

“We do not reach our conclusion lightly,” Lynch wrote on behalf of the unanimous panel. “A life sentence is the second most severe penalty that may be imposed in the federal criminal justice system.”

For Ulbricht’s supporters, however, the sentence is symbolic of prosecutorial overreach in the digital war on drugs and a doomed government effort to control an online trade that defies restraint.

Two years and two days ago, U.S. District Judge Katherine Forrest cast Ulbricht as a pioneering criminal for using encryption technologies to facilitate illicit bitcoin transactions, in a billion-dollar website likened to the eBay of the drug trade.

“What you did was unprecedented, and in breaking that ground as the first person, you sit here as the defendant now having to pay the consequences for that,” Forrest said at a three-hour sentencing hearing on May 29, 2015.

Before imposing the heaviest sentence available, Forrest heard from family members of addicts who overdosed on drugs bought on Silk Road, and spoke candidly about her own qualms about causing pain to Ulbricht’s family.

The judge had been especially outraged by evidence presented at trial that Ulbricht hired hit men to kill five men who posed a threat to his business. Police never found proof that anybody died as the result of a murder-for-hire, and Ulbricht’s defenders note that he was never charged with this crime.

But for Forrest, prosecutors supplied ample evidence of Ulbricht’s intent to kill, showing the jury journal entries, chat logs and bitcoin transfers to would-be assassins.

Poring over what it called an “extraordinarily detailed sentencing transcript,” Judge Lynch said Friday that Ulbricht’s sentencing judge clearly appreciated the importance of her decision “and carried out that responsibility with care and prudence.” 

Joining Lynch on the appellate panel were U.S. Circuit Judges Jon Newman and Christopher Droney. At oral arguments in October, the latter had seemed uneasy by Ulbricht’s life sentence.

“It is unusual for a young man in his early 30s with no criminal record, who himself was not dealing drugs, except some mushrooms at one point, at least there was some evidence that suggested that, to receive a life sentence,” Droney had said.

Throughout his trial, Ulbricht’s attorney Joshua Dratel portrayed his client as an idealistic creator of a website that gave customers the privacy to buy or sell what they wanted without government interference.

Ulbricht claimed to have left his project early on, saying he was framed for the bad conduct of the subsequent administrators who took over his online identity “Dread Pirate Roberts” — a reference to the novel-turned-Disney-movie “The Princess Bride.”

The federal jury swiftly rejected this murky defense, which never explained how a mountain of damning evidence — including emails, passwords, financial records, journal entries, chat logs, and bitcoin blockchains — wound up on Ulbricht’s Samsung 700Z laptop.

Hoping to thread that needle, Ulbricht’s lawyers hinged their appeal on the confessions of two federal agents who worked on the Silk Road investigation.

Secret Service agent Shaun Bridges and Drug Enforcement Agency official Carl Force admitted in 2015 to having swiped hundreds of thousands of dollars in bitcoins for themselves while working on Baltimore’s Silk Road Task Force.

New York federal investigators later took control of the investigation, but the Second Circuit noted Tuesday that there is no evidence of Bridges and Force having set up Ulbricht.

“Without question, the shocking personal corruption of these two government agents disgraced the agencies for which they worked and embarrassed the many honorable men and women working in those agencies to investigate serious criminal wrongdoing,” the opinion states. “Even more importantly, when law enforcement officers abuse their offices for personal gain, commit other criminal acts, violate the rights of citizens, or lie under oath, they undermine the public’s vital trust in the integrity of law enforcement. They may also compromise the investigations and prosecutions on which they work.”

Denying that the conduct went further than a couple of bad apples, however, the judges said their admissions should not erode the confidence in the outcome of the Ulbricht investigation.

“At the same time, the venality of individual agents does not necessarily affect the reliability of the government’s evidence in a particular case or become relevant to the adjudication of every case in which the agents participated,” Lynch wrote.

Ulbricht’s attorney Dratel also claimed in November, at a press conference held in his lower Manhattan office, to have found indications that another corrupt agent was caught tampering with evidence.

Declining to submit this evidence to the Second Circuit, however, Dratel told reporters that it had not been part of the trial record and would slow down a then-active appeal.

Dratel did not have any comment on the court’s ruling on Wednesday.

Ulbricht’s mother meanwhile called the ruling a “huge shock and blow” in a statement posted to the website she maintains for the Silk Road founder’s support network.

“I feel like I’m reliving the day Ross was sentenced and now must go tell Ross that the Second Circuit has upheld his convictions and double life sentence,” wrote Lyn Ulbricht, who had been a regular fixture at her son’s trial. “I can’t fathom how the court can believe that keeping Ross locked up for the rest of his life accomplishes anything but wasting a life and lots of money.”

Federal prisoners are not eligible for parole, meaning that Ulbricht stands no chance of release under the current law.

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