GenPhar asset solution sought

A federal judge has asked attorneys in the GenPhar fraud case to try to find a way to safeguard assets the government may seize without crippling the biotech company before a verdict is rendered.

Federal prosecutors have been seeking to freeze the assets of the Mount Pleasant firm and its founder, Jian-Yun Dong, to make sure the government can recoup some $3.6 million in grant money he is accused of stealing. Assistant U.S. Attorney Mark Moore told a judge Monday that more than $20,000 recently disappeared from one account alone.

Dong has argued that he needs the money to pay legal bills and keep his company running. Dong recently retained Charleston lawyer Peter Shahid to represent him in the case, apparently resolving long-running concerns over his lack of legal counsel.

U.S. District Judge Richard Gergel told the defendants to file a formal reply by Monday to the government's request for a restraining order. But he also urged the two sides to try to work out a solution that would protect the government's interests without "crushing GenPhar before trial."

"We don't need to have scorched earth here before the defendant has been tried," he said.

Dong, 54, and his biotech company are accused of stealing millions in federal grants intended for research on vaccines for the deadly Ebola and Marburg viruses.

Dong and his estranged wife, Danher Wang, also are accused of illegally funneling $31,000 to U.S. Sen. Lindsey Graham's campaign and the senator's political action committee. Graham is not accused of wrongdoing.

Wang's attorney, Sherri A Lydon, told Gergel that her client is fully cooperating with the government and a plea agreement is expected "very soon."

Also Monday, Gergel denied a motion from prosecutors seeking to draw from a statewide pool of jurors due to concerns about the pretrial publicity about the case in the Charleston area. Gergel said he has seen a few newspaper articles on the case but nothing to indicate a "carpet-bombing of coverage" that would taint the jury pool and interfere with a fair and impartial trial.

Reach Glenn Smith at 937-5556 or Twitter.com/glennsmith5.