May 31, 2017 / 4:03 PM / 3 months ago

Silk Road website founder loses appeal of conviction, life sentence

Lyn and Kirk Ulbricht (back R), parents of Ross Ulbricht, speak to journalists after his conviction in Lower Manhattan, New York February 4, 2015.Nate Raymond

NEW YORK (Reuters) - Ross Ulbricht, the accused mastermind behind the underground Silk Road website for the sale of illegal drugs to customers worldwide, failed to persuade a federal appeals court to overturn his conviction and life sentence.

The 2nd U.S. Circuit Court of Appeals in Manhattan on Wednesday rejected Ulbricht's claim that he was denied a fair trial because he could not introduce evidence of corruption by two federal agents involved in his probe.

It also rejected the 33-year-old Ulbricht's claim that his prison term of life with no possibility of parole, was too long.

The three-judge panel cited the "staggering" $183 million of illegal drugs sold on Silk Road from 2011 to 2013, and a lower court's finding it more likely than not that Ulbricht arranged at least five murders for hire to protect Silk Road's anonymity.

"That he was able to distance himself from the actual violence he paid for by using a computer to order the killings is not mitigating," Circuit Judge Gerard Lynch wrote in a 139-page decision. "Indeed, the cruelty that he displayed in his casual and confident negotiations for the hits is unnerving."

There is no evidence that any of the murders took place, Lynch said.

Joshua Dratel, a lawyer for Ulbricht, declined to comment, including on whether a U.S. Supreme Court appeal is possible.

A spokeswoman for Acting U.S. Attorney Joon Kim in Manhattan declined to comment.

Jurors in February 2015 found Ulbricht, of San Francisco, guilty of seven counts for helping to enable drug sales using the virtual currency bitcoin. He was sentenced three months later by U.S. District Judge Katherine Forrest.

Prosecutors said Ulbricht ran Silk Road under the alias Dread Pirate Roberts, a character from the novel popularized by the 1987 movie "The Princess Bride," and that drugs distributed on the website were linked to at least six overdose deaths.

Ulbricht has admitted to creating Silk Road, but rejected suggestions that he operated it. The website was shut down in October 2013.

Dratel had argued that Ulbricht should have been allowed to introduce evidence of corruption during the probe by former Secret Service agent Shaun Bridges and Drug Enforcement Administration agent Carl Force.

Both later pleaded guilty to money laundering and other charges and were sentenced to prison after stealing bitcoins during the probe.

Lynch, however, said that while "the shocking personal corruption of these two government agents disgraced the agencies for which they worked," it "has nothing to do with whether Ulbricht operated the site as Dread Pirate Roberts."

The case is U.S. v. Ulbricht, 2nd U.S. Circuit Court of Appeals, No. 15-1815.

Reporting by Jonathan Stempel in New York; editing by Dan Grebler, G Crosse

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