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Weekend Law: James Comey, ICE Shooting & Copycat Drugs · Bloomberg Law

0:02
Speaker 1: This is Bloomberg Law with June Grosso from Bloomberg Radio.
0:08
Speaker 2: Last Saturday marked nine months since our son's murder. We
0:13
Speaker 2: learned about his death from the media as we saw
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Speaker 2: him being shot repeatedly in the back after helping a
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Speaker 2: woman from his community, a fellow Minnesotan, who had been
0:24
Speaker 2: shoved to the ground viciously.
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Speaker 1: Nine months ago, Alex Pratty was killed when ICE agents
0:30
Speaker 1: fired at least 10 bullets into his back in a
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Speaker 1: matter of seconds. The 24-year-old, a U.S. citizen and intensive
0:38
Speaker 1: care nurse, had joined the protests against the Trump administration's
0:43
Speaker 1: immigration crackdown in Minnesota. A video shows him holding a
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Speaker 1: phone in one hand and trying to shield his face
0:50
Speaker 1: from pepper spray when he was shoved to the ground
0:53
Speaker 1: by ICE agents and shot. His mother and father, Susan
0:57
Speaker 1: and Michael Preddy, say that the federal government has ignored
1:00
Speaker 1: them and is shielding his killers.
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Speaker 3: We are here begging for the Department of Justice to
1:08
Speaker 3: do what is right, to hold the men who murdered
1:12
Speaker 3: our son accountable for what they did.
1:15
Speaker 1: The Department of Homeland Security hasn't announced any developments yet.
1:19
Speaker 1: in an investigation that may or may not be going on.
1:23
Speaker 1: This echoes the department's handling of the killing of Rene Good,
1:27
Speaker 1: another U.S. citizen shot to death by an ICE agent
1:31
Speaker 1: in Minneapolis back in January. Joining me is Leon Fresco,
1:36
Speaker 1: a partner at Holland & Knight. He was the head
1:38
Speaker 1: of the Office of Immigration Litigation during the Obama administration. Leon,
1:43
Speaker 1: Freddie's parents say that the federal government hasn't given them
1:47
Speaker 1: any information about the investigation into their son's killing and
1:52
Speaker 1: that they didn't even get a response to a letter
1:54
Speaker 1: they sent to the Justice Department. Is this unusual?
1:58
Speaker 4: Well, there is a statute called the Crime Victims' Rights Act,
2:01
Speaker 4: which gives victims, including the family members of deceased victims,
2:06
Speaker 4: the rights to confer with the government's attorney and to
2:09
Speaker 4: be treated with fairness and respect and for timely information.
2:14
Speaker 4: But the key issue here is the timing. The statute
2:17
Speaker 4: is usually built around court proceedings, and courts have divided
2:21
Speaker 4: on whether and how far its rights attach before charges
2:26
Speaker 4: are filed. DOJ's communications come at a later stage is
2:31
Speaker 4: basically their pre-charge position. They're saying that at the end
2:35
Speaker 4: of the day, this is too early because the investigation
2:39
Speaker 4: is where everything has to be kept in a bubble.
2:41
Speaker 4: But if the Pretty family wanted to do something, they
2:44
Speaker 4: could actually file a mandamus lawsuit in a district court.
2:49
Speaker 4: They can't get any damages. They can't force a prosecution,
2:52
Speaker 4: but they can try to get a district judge to
2:55
Speaker 4: basically force them to confer and give them information about
3:00
Speaker 4: where this case is, where it's going, etc. They have
3:04
Speaker 4: to force this in their own way. There's nothing that
3:06
Speaker 4: they're going to get just by sort of asking politely.
3:11
Speaker 4: So they're trying to first try to see if the
3:13
Speaker 4: media route will work. And then if the media route
3:16
Speaker 4: doesn't work, they can file this mandamus lawsuit in the
3:19
Speaker 4: Crime Victims Rights Act. They can try to file a
3:22
Speaker 4: Federal Tort Claims Act case. which would say that the
3:27
Speaker 4: individuals who engaged in this murder of Alex Priddy were
3:32
Speaker 4: acting outside of the scope of their employment. They basically
3:36
Speaker 4: committed a murder, a cold-blooded murder. It's tough because Border
3:40
Speaker 4: Patrol and immigration people are shielded from a lot of
3:44
Speaker 4: these things, from Bivid's lawsuits and Federal Tort Claims Act lawsuits,
3:48
Speaker 4: but nevertheless, that's going to be their best route to
3:51
Speaker 4: try to get information about this case and who's to blame.
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Speaker 1: Well, Minnesota law enforcement authorities are also having trouble getting
3:58
Speaker 1: information from the federal government. They sued in March, but
4:03
Speaker 1: the feds still haven't shared critical information and evidence, like
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Speaker 1: a statement made by one of the officers about the shooting.
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Speaker 4: Yes, that's correct. The state can try to launch a prosecution,
4:17
Speaker 4: which again would have to show that the agents were
4:20
Speaker 4: not acting in a way that was necessary and proper,
4:22
Speaker 4: and again, essentially were committing a cold-blooded murder. The problem is,
4:27
Speaker 4: as you said, they can't get the necessary evidence that
4:31
Speaker 4: they need for this case. They can't get the statement
4:33
Speaker 4: of the agent, they can't get the weapon that was used,
4:36
Speaker 4: and so the state can't build a case, and so
4:39
Speaker 4: this is where they then potentially have to go to
4:42
Speaker 4: a federal court and try to force a decision from
4:46
Speaker 4: a judge to say that this information is needed, just
4:49
Speaker 4: like they tried to go before. This is their only
4:52
Speaker 4: option if the federal government isn't going to cooperate with them.
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Speaker 1: I mean, is there even an investigation going on?
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Speaker 4: Well, this is where the federal government is saying this
5:01
Speaker 4: is not outside the bounds of a normal time period
5:05
Speaker 4: for an investigation. And so... In the end, this may
5:09
Speaker 4: have to get litigated, and there's going to be an
5:12
Speaker 4: issue of put up or shut up. What have you
5:13
Speaker 4: been doing? But at the end of the day, both
5:16
Speaker 4: the parents of Alex Priddy and the state have very
5:20
Speaker 4: tough sledding in the world where the federal government doesn't
5:23
Speaker 4: want to do any cooperation at all. They're going to
5:27
Speaker 4: need a pretty active court to start giving them information
5:32
Speaker 4: that wouldn't normally be given. Now, they might be able
5:35
Speaker 4: to find some judges in Minnesota to do that, But
5:37
Speaker 4: we're going to have to wait and see.
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Speaker 1: I mean, the federal government has yet to bring charges
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Speaker 1: against any agent involved in the at least eight shooting
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Speaker 1: deaths since January of 2025.
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Speaker 4: They haven't really gone after the agents involved. And that's
5:56
Speaker 4: because the position of this administration is this is a
5:59
Speaker 4: very difficult job. It's a very unsafe job. And so
6:04
Speaker 4: the agents need to have vast authority to be able
6:06
Speaker 4: to perform their duties. And some of these things are
6:09
Speaker 4: going to happen because people are upset about immigration enforcement.
6:14
Speaker 4: But the solution is not to penalize the agents who
6:17
Speaker 4: are trying to do the best job under the circumstances.
6:19
Speaker 4: Other people look at these exact facts and say, this
6:22
Speaker 4: is not bad. This is a cold-blooded murder. There's no
6:25
Speaker 4: excuse for this. And the issue is, will any of
6:29
Speaker 4: that at all even be reviewed by any court? Or
6:32
Speaker 4: will the court just say, at the end of the day,
6:35
Speaker 4: the federal government has broad immunities to conduct its investigations
6:39
Speaker 4: on its individuals however it wants, and that's going to
6:42
Speaker 4: be the end of it. And so we're going to
6:43
Speaker 4: need to see how that plays out in court.
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Speaker 1: I would be shocked if the Trump administration ever brings
6:50
Speaker 1: charges against any of these agents involved in these killings.
6:54
Speaker 1: But let's turn now to the Supreme Court. This week,
6:57
Speaker 1: the justices allowed a deportation deal between Texas and the
7:02
Speaker 1: Trump administration that's been called a collusive settlement. It stems
7:07
Speaker 1: from Texas suing the federal government to challenge a regulation
7:12
Speaker 1: that allows immigration judges to pause deportation proceedings. Tell us
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Speaker 1: about it.
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Speaker 4: The state of Texas sued in Texas and said this
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Speaker 4: is not legal, this regulation. There should be no such
7:26
Speaker 4: thing in immigration court. You should either finish a case
7:30
Speaker 4: or dismiss a case if a case doesn't meet the
7:32
Speaker 4: standard for deportation. They actually enter into a settlement with
7:36
Speaker 4: the Department of Justice where both sides agree, yes, this
7:39
Speaker 4: rule is illegal. So as a part of the settlement,
7:43
Speaker 4: not only are we not going to follow this rule,
7:45
Speaker 4: we agree as the federal government to permanently never have
7:49
Speaker 4: a rule like this. And so a bunch of cities
7:52
Speaker 4: then say, well, I understand that the state of Texas sued,
7:55
Speaker 4: but we should have a right to intervene in this
7:57
Speaker 4: lawsuit and say, nobody asked for this. This is just
8:01
Speaker 4: one state. Since there isn't an opposing view in this case,
8:05
Speaker 4: we should be allowed to intervene. But actually the Fifth
8:07
Speaker 4: Circuit and the districts within the Fifth Circuit usually have
8:10
Speaker 4: very expansive intervener law. They usually let pretty much anybody
8:14
Speaker 4: intervene as we've seen over the last 10 years in
8:17
Speaker 4: immigration cases. But here they said, that the cities had
8:21
Speaker 4: no standing because they can show how a specific city
8:25
Speaker 4: suffered from this rule being taken away. And so that
8:29
Speaker 4: was the end of it. The settlement stood in place.
8:32
Speaker 4: These cities then tried to appeal and the Fifth Circuit said,
8:36
Speaker 4: go away. We are not interested in any argument you're making.
8:39
Speaker 4: And the Supreme Court now declined to move forward and
8:42
Speaker 4: similarly agreed that these cities have no standing.
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Speaker 1: Beyond this case and immigration issues, Isn't there a broader
8:50
Speaker 1: concern here about these kinds of deals?
8:53
Speaker 4: The sort of larger term question, is this going to
8:56
Speaker 4: be a new thing where rather than going through the
8:59
Speaker 4: whole administrative law process, you just take a state that
9:04
Speaker 4: is partial to the view of whatever new administration is
9:07
Speaker 4: there and just sue about any regulation that the new
9:11
Speaker 4: administration didn't want and just enter into a settlement and
9:14
Speaker 4: basically circumvent the entire meaning of the Administrative Procedure Act. Now,
9:19
Speaker 4: I will say this, as conspiratorially and dastardly as a
9:23
Speaker 4: lot of people have said this is, I will note
9:26
Speaker 4: that during the Biden administration, this exact same thing happened
9:30
Speaker 4: where the state of Illinois and the Biden administration entered
9:33
Speaker 4: into a some sort of similar collusive arrangement to get
9:37
Speaker 4: rid of the public charge regulation that the Trump administration
9:40
Speaker 4: had put in. And at that time, the Supreme Court
9:43
Speaker 4: was very wary, but just said, we're not going to
9:45
Speaker 4: get into this right now, but we don't like this.
9:48
Speaker 4: We may have to get into this some other day.
9:51
Speaker 4: And so at some point, they're going to have to
9:53
Speaker 4: get into this question. There's no doubt about it.
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Speaker 1: What was surprising to me is that there were no dissents.
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Speaker 4: I think the problem is that the standing issue wasn't
10:02
Speaker 4: the cleanest way of going after it. And so I
10:05
Speaker 4: think both sides understand the stakes and they understand that
10:09
Speaker 4: each side has done this now. So sort of Everybody
10:12
Speaker 4: knows that they can be harmed by this. We have
10:14
Speaker 4: nuclear deterrents on each side. And so I just think
10:18
Speaker 4: they want to do this cleanly without the standing issue
10:21
Speaker 4: involved and take this case not in the emergency shadow docket,
10:27
Speaker 4: but in a real docket. This was strategic. And I
10:31
Speaker 4: think everybody knows that it may take a year or two,
10:34
Speaker 4: but it's definitely coming.
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Speaker 1: I mean, it may not be illegal, but it doesn't
10:38
Speaker 1: seem right for one administration to be able to make
10:43
Speaker 1: a regulation that future administrations can't change.
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Speaker 4: It certainly is unconventional. It's certainly an end run around
10:51
Speaker 4: the Administrative Procedure Act and how the regulatory process is
10:55
Speaker 4: supposed to go. I don't think anyone thought that collusive
10:59
Speaker 4: settlement was with states that agree with you is the
11:02
Speaker 4: new legislation in America. But this is what happens when
11:05
Speaker 4: you don't have a Congress that passes laws and when
11:09
Speaker 4: you have courts that block regulatory actions. then your next
11:13
Speaker 4: move is settlements because you have to figure out some
11:17
Speaker 4: way to govern. And so the more governing tactics that
11:20
Speaker 4: used to work that no longer work, the more you
11:23
Speaker 4: get things like this. Quite a challenging area. We've now
11:27
Speaker 4: seen both sides use it. So now it's going to
11:29
Speaker 4: be an issue that the courts are going to have
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Speaker 4: to address.
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Speaker 1: Yeah, it seems like more and more issues are being
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Speaker 1: left to the courts these days. Thanks as always, Leon.
11:37
Speaker 1: That's Leon Fresco of Holland & Knight. Coming up next,
11:41
Speaker 1: James Comey indicted for the third time. I'm June Grosso,
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Speaker 1: and you're listening to Bloomberg. They say the third time's
11:51
Speaker 1: a charm. And the Trump administration is charging former FBI
11:55
Speaker 1: Director James Comey with a crime for the third time
11:59
Speaker 1: in a little over a year. Federal prosecutors have charged
12:02
Speaker 1: Comey with leaking secret national defense information to the media
12:07
Speaker 1: a decade ago when he was FBI Director. Comey has
12:10
Speaker 1: denied the allegations and vowed to fight the charges.
12:15
Speaker 5: Well, they're back again.
12:16
Speaker 2: It would almost be funny if it weren't such an
12:18
Speaker 2: appalling abuse of the Department of Justice.
12:21
Speaker 1: President Trump has repeatedly criticized Comey and called for his prosecution.
12:27
Speaker 5: Well, I think he's a dirty cop, James Comey, but
12:29
Speaker 5: I know nothing about it. He's a dirty cop.
12:32
Speaker 1: And in an unusual move, federal prosecutors filed the charges
12:37
Speaker 1: against Comey by what's known as a criminal information, rather
12:41
Speaker 1: than getting a grand jury indictment. Joining me is former
12:45
Speaker 1: federal prosecutor Robert Mintz, a partner in McCarter and English. Bob,
12:49
Speaker 1: what do we know about the charges against Comey this time?
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Speaker 6: Well, this is the third federal case that this Department
12:56
Speaker 6: of Justice has brought against former FBI Director James Comey.
13:01
Speaker 5: And in this case, what.
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Speaker 6: We know is that he is being charged by criminal
13:07
Speaker 6: information with two counts, transmission of national defense information and
13:12
Speaker 6: conspiracy to transmit national defense information. The allegations are tied
13:17
Speaker 6: to a New York Times article in October 2016 that
13:21
Speaker 6: related to a secret court order that required Yahoo to
13:25
Speaker 6: scan emails for messages potentially linked to to a foreign
13:29
Speaker 6: terrorist organization. The story cited two government officials who spoke
13:34
Speaker 6: on condition of anonymity about the order from a judge
13:37
Speaker 6: on the Foreign Intelligence Surveillance Court that Yahoo was barred
13:41
Speaker 6: from publicly disclosing. The allegation is that James Comey directed
13:47
Speaker 6: his then general counsel to the FBI, to disclose information
13:52
Speaker 6: that was classified, part of the Foreign Intelligence Surveillance Court's
13:56
Speaker 6: information that was not to be disclosed publicly in order
13:59
Speaker 6: to correct information that he viewed as inaccurate. so that
14:03
Speaker 6: the New York Times could write a more accurate story.
14:06
Speaker 6: And we do know that this issue about this particular
14:10
Speaker 6: leak has been investigated twice prior by the Trump Department
14:15
Speaker 6: of Justice during the first Trump term. Then Special Counsel
14:19
Speaker 6: John Durham began investigating this leak in 2017 and ultimately
14:26
Speaker 6: ended up writing a classified memo that recommended no criminal
14:29
Speaker 6: charges be brought against anybody in connection with that disclosure.
14:34
Speaker 6: Also in January 2019, the U.S. Attorney's Office for the
14:37
Speaker 6: District of Columbia opened a second investigation into the same
14:41
Speaker 6: alleged improper leak and closed that investigation without any charges
14:45
Speaker 6: filed in February 2020.
14:48
Speaker 1: Prosecutors didn't go to a grand jury to get an
14:51
Speaker 1: indictment here. They filed a criminal information. Explain what that is.
14:56
Speaker 6: That's very important to understand here because all felony charges,
15:02
Speaker 6: meaning any charge that carries a penalty of imprisonment of
15:05
Speaker 6: more than one year, has to go before a grand jury.
15:10
Speaker 6: And this right to have your case heard before a
15:13
Speaker 6: grand jury is rooted in the Fifth Amendment. So there
15:16
Speaker 6: is an absolute legal requirement that any felony case go
15:19
Speaker 6: before a grand jury and be voted by that grand
15:22
Speaker 6: jury before it can proceed. One exception to that is
15:25
Speaker 6: what's called a criminal information. That is a case in
15:28
Speaker 6: which prosecutors can directly charge a defendant with a felony
15:33
Speaker 6: without going in front of a grand jury. But in
15:35
Speaker 6: that case, there has to be an explicit waiver of
15:38
Speaker 6: the right to proceed before a grand jury by a defendant.
15:42
Speaker 6: And the circumstance that you see that coming up often
15:45
Speaker 6: as a federal prosecutor is when prosecutors have worked out
15:48
Speaker 6: a criminal plea with a defendant. In other words, no
15:51
Speaker 6: indictment has yet been returned and prosecutors ultimately reach a
15:55
Speaker 6: deal with There's no real reason at that point to
15:58
Speaker 6: go before a grand jury because that's set up to
16:01
Speaker 6: protect the rights of the defendant. But critical to that
16:04
Speaker 6: analysis is that the defendant has to waive the right
16:08
Speaker 6: to proceed before a grand jury. In this case, there
16:12
Speaker 6: was no such waiver. James Comey did not agree to
16:15
Speaker 6: proceed with any criminal charges. And so what happened here
16:18
Speaker 6: is that there was a 10-year statute of limitations that
16:21
Speaker 6: was set to expire on these charges and prosecutors went
16:25
Speaker 6: into court and filed this criminal information solely for the
16:29
Speaker 6: purpose of tolling that statute of limitations. And the Comey
16:33
Speaker 6: defense team has argued that that was an improper use
16:37
Speaker 6: of a criminal information that is being done solely to
16:40
Speaker 6: circumvent the 10-year statute of limitations. And they've asked the
16:44
Speaker 6: judge to throw out these charges on that basis.
16:47
Speaker 1: The Justice Department said in a statement, filing a criminal
16:51
Speaker 1: information to toll the statute of limitations is a widely
16:54
Speaker 1: recognized practice in federal court and has been approved by
16:58
Speaker 1: multiple circuit courts of appeals. Is that true?
17:02
Speaker 6: Well, it's certainly not true that it is a widely
17:05
Speaker 6: used practice because I was a federal prosecutor for 10
17:08
Speaker 6: years and I've never heard of prosecutors going in seeking
17:13
Speaker 6: charges based on information in order to toll the statute
17:16
Speaker 6: of limitations. It rarely occurs, but it's not improper to
17:20
Speaker 6: say that it never occurs. And in fact, there is
17:22
Speaker 6: a case that was brought in 2025 before the Court
17:26
Speaker 6: of Appeals for the 11th Circuit, where this very issue
17:29
Speaker 6: was addressed by the court. In that case, the defendants
17:32
Speaker 6: had been charged with using stolen social security numbers to
17:36
Speaker 6: get government benefits. And under federal law, those charges had
17:40
Speaker 6: a five-year statute of limitations. The issue in that case
17:44
Speaker 6: is that during the COVID-19 pandemic, the court system in
17:48
Speaker 6: South Florida suspended grand juries for a period of time.
17:52
Speaker 6: And so prosecutors, in order to avoid letting the statute
17:55
Speaker 6: of limitations expire, went in and they brought the allegation
18:00
Speaker 6: by way of a criminal information. And then they later
18:03
Speaker 6: went before the grand jury and got the indictment. In
18:07
Speaker 6: that case, the defendants tried to argue that that the
18:10
Speaker 6: criminal charges had already expired because the statute of limitations expired.
18:14
Speaker 6: The Court of Appeals there upheld the lower court and
18:18
Speaker 6: said that it was proper to use the information for
18:21
Speaker 6: purposes of tolling the statute of limitations, which is what
18:25
Speaker 6: prosecutors are doing here. So it has rarely been used.
18:28
Speaker 6: In that case, there was a unique circumstance of the
18:32
Speaker 6: COVID-19 pandemic where there was no grand juries sitting. So
18:36
Speaker 6: prosecutors really had no choice. But to do it in
18:38
Speaker 6: that case, this is a different circumstance where this case
18:41
Speaker 6: has been out there for more than 10 years and
18:44
Speaker 6: has been investigated twice that Comey's lawyers argue that it
18:47
Speaker 6: is an improper use of the criminal information process and
18:51
Speaker 6: is done solely to circumvent the a 10-year statute of limitations,
18:55
Speaker 6: and prosecutors should have brought an indictment if they intended
18:58
Speaker 6: to proceed with the case.
18:59
Speaker 1: And that Florida case was in the 11th Circuit, so
19:02
Speaker 1: it's not controlling precedent in D.C. Now, there was a
19:06
Speaker 1: hearing on Friday on Comey's motion to get the criminal
19:09
Speaker 1: information tossed, and prosecutors told the judge they're actively working
19:14
Speaker 1: to secure a grand jury indictment against Comey. But if
19:18
Speaker 1: after 10 years they still didn't have enough to bring
19:21
Speaker 1: the case before a grand jury, does it seem like
19:23
Speaker 1: they just don't have the evidence they need?
19:26
Speaker 6: That's exactly the question here, because even if the court
19:29
Speaker 6: allows this case to move forward based on the criminal information,
19:33
Speaker 6: and the court has not yet ruled on that, there's
19:36
Speaker 6: no question that prosecutors still have to go before a
19:39
Speaker 6: grand jury and get an indictment. In other words, without
19:42
Speaker 6: a waiver of the grand jury indictment process, which Comey's
19:46
Speaker 6: defense team is not going to give, prosecutors still have
19:49
Speaker 6: to go in front of a grand jury, even if
19:52
Speaker 6: the statute of limitations has been told by the filing
19:55
Speaker 6: of the information, and they have to convince at least
19:58
Speaker 6: 12 of those jurors that there's probable cause that James
20:02
Speaker 6: Comey has committed this crime and that they should allow
20:05
Speaker 6: this case to proceed.
20:06
Speaker 1: And Bob, the 10-year statute of limitations They went down
20:10
Speaker 1: to the wire to the very last day they could
20:13
Speaker 1: bring the charges because the article was published on October
20:17
Speaker 1: 5th of 2016.
20:18
Speaker 6: Yeah, no question that their back was against the wall.
20:22
Speaker 6: and that this was essentially a last-ditch effort to try
20:25
Speaker 6: to preserve this investigation. So it's going to be interesting
20:28
Speaker 6: to see what the judge does with this motion, whether
20:32
Speaker 6: he throws out the case or lets it proceed on
20:35
Speaker 6: the assumption that prosecutors still have to go before a
20:38
Speaker 6: grand jury and obtain an indictment And even then, the
20:42
Speaker 6: defense can still argue by virtue of the 10 years
20:46
Speaker 6: that had gone by, by virtue of the fact that
20:48
Speaker 6: this case had been investigated twice before, that this was
20:52
Speaker 6: really a vindictive prosecution, that it's not based on an
20:56
Speaker 6: effort to obtain justice here, but it is something like
21:00
Speaker 6: a personal political vendetta that is being brought against James Comey.
21:04
Speaker 1: And prosecutors might have trouble getting a grand jury to
21:07
Speaker 1: indict Comey because this Trump Justice Department has disproved that
21:12
Speaker 1: old adage that a prosecutor can get a grand jury
21:16
Speaker 1: to indict a ham sandwich. In fact, this week, the D.C.
21:20
Speaker 1: grand jury refused to indict former White House aide Cassidy
21:24
Speaker 1: Hutchinson for perjury over her testimony about President Trump's actions
21:29
Speaker 1: during the January 6, 2021 attack on the Capitol.
21:33
Speaker 6: The focus of the investigation apparently was regarding some explosive
21:39
Speaker 6: testimony that Cassidy Hutchinson gave before Congress, where she testified
21:45
Speaker 6: that another White House aide had told her that President
21:49
Speaker 6: Trump had lunged at a Secret Service agent earlier. inside
21:53
Speaker 6: the presidential SUV after being told he could not accompany
21:57
Speaker 6: the group as it marched from the Ellipse. Later, there
22:01
Speaker 6: were other individuals who were present in the vehicle who
22:04
Speaker 6: contradicted that testimony. So what you have here is simply
22:08
Speaker 6: two different recollections of what occurred, and then her testimony
22:11
Speaker 6: was simply repeating what she'd been told by another individual.
22:15
Speaker 6: So that is kind of a high bar for prosecutors
22:18
Speaker 6: to meet, but still, it is rare for prosecutors not
22:22
Speaker 6: to come back with an indictment. Because remember, grand jurors
22:25
Speaker 6: only have to find that there's probable cause that a
22:29
Speaker 6: crime was committed. That means that they only have to
22:32
Speaker 6: find that there is a bare minimum of evidence to
22:35
Speaker 6: allow the case to go forward. It's a relatively low threshold,
22:38
Speaker 6: and in fact, it's the lowest threshold in the criminal
22:41
Speaker 6: justice system. So for grand jurors to decide that the
22:44
Speaker 6: evidence is so weak that it doesn't even get to
22:47
Speaker 6: go to trial is a complete rejection of the government's
22:51
Speaker 6: theory of prosecution.
22:52
Speaker 1: And grand juries have also refused to return indictments against
22:56
Speaker 1: the six Democratic lawmakers who made a video telling soldiers
23:01
Speaker 1: to refuse illegal orders, against New York Attorney General Letitia
23:05
Speaker 1: James three times, against two people accused of threatening to
23:10
Speaker 1: kill Trump. Just to name a few cases, why do
23:13
Speaker 1: you think grand juries are refusing to return indictments in
23:16
Speaker 1: so many cases?
23:17
Speaker 6: We are seeing a pattern of rejection by grand juries.
23:22
Speaker 6: of cases presented by federal prosecutors that is virtually unprecedented.
23:27
Speaker 6: It almost never happens that grand jurors refuse to return
23:30
Speaker 6: an indictment. And now, as you say, there's been a
23:33
Speaker 6: string of rejections of cases where the Department of Justice
23:36
Speaker 6: has sought indictments. What I will say is when you
23:40
Speaker 6: have Republicans and the president calling for these criminal investigations publicly,
23:45
Speaker 6: whether you view them as political or not, even the
23:48
Speaker 6: perceived politicization of the criminal justice system erodes the trust
23:54
Speaker 6: and the deference that grand juries have historically afforded federal prosecutors.
23:58
Speaker 6: I think that's why we're seeing these acts of almost
24:01
Speaker 6: civil disobedience by grand jurors refusing to indict cases presented
24:05
Speaker 6: by the Department of Justice.
24:07
Speaker 1: It's one setback after another in these cases against Trump's
24:11
Speaker 1: perceived political enemies. Great conversation. Thanks so much, Bob. That's
24:16
Speaker 1: Robert Mintz of McCarter & English. Coming up next, Eli
24:20
Speaker 1: Lilly has a tough game plan to stop black market
24:24
Speaker 1: sales of copycat versions of its new weight loss drug.
24:28
Speaker 1: I'm June Grosso, and this is Bloomberg. There are countless
24:44
Speaker 1: ads for the weight loss drug retatrutide on the Internet,
24:48
Speaker 1: despite the fact that it's an experimental drug that hasn't
24:52
Speaker 1: been approved yet by the FDA. Online vendors and wellness
24:56
Speaker 1: clinics have been selling copycat versions of Eli Lilly's experimental drug,
25:02
Speaker 1: promoting the medication as research-use-only products to bypass scrutiny. But
25:08
Speaker 1: Eli Lilly is taking a hard legal stance against the
25:11
Speaker 1: black market sellers and using several avenues to protect what's
25:16
Speaker 1: expected to be a blockbuster drug. Joining me is FDA
25:21
Speaker 1: regulatory attorney Edgar Acebe, a partner in Friar Levitt's Life
25:25
Speaker 1: Sciences practice group. Edgar, so this is a weight loss
25:29
Speaker 1: drug by Eli Lilly that hasn't gotten FDA approval yet.
25:34
Speaker 1: but other companies are selling counterfeit versions of it on
25:37
Speaker 1: the internet. Explain what's happening here.
25:40
Speaker 5: Let me give you the big context so this all
25:42
Speaker 5: makes sense. So there was a shortage a few years
25:45
Speaker 5: ago of GLP-1s, of trisepatide and semaglutide, you know, Ozempic
25:50
Speaker 5: and Wagovi. There wasn't enough supply to meet the demand.
25:55
Speaker 5: So FDA put both of those drugs on the shortage list.
26:01
Speaker 5: The branded makers like Novo Nordisk and Lilly, their products
26:05
Speaker 5: went on the shortage list because they couldn't supply enough.
26:08
Speaker 5: And therefore, compounding pharmacies could make essentially copies of that
26:13
Speaker 5: to meet the demand. And there was no violation of
26:16
Speaker 5: the patents or of any FDA rules because there was
26:19
Speaker 5: an official shortage. That shortage ended and Compounded pharmacies wanted
26:23
Speaker 5: to keep making those compounded versions, but they could no
26:26
Speaker 5: longer do that lawfully. And those companies were also making
26:29
Speaker 5: peptides that you hear about so much. So those same
26:32
Speaker 5: companies decided that they were going to go directly buy
26:36
Speaker 5: API from China, active pharmaceutical ingredient, repackage it and sell
26:41
Speaker 5: it for research use only, RUO. So RUO peptides, that's
26:46
Speaker 5: the sector we're talking about. And the guys is, or
26:50
Speaker 5: the facade is, we're selling these just for research. And
26:53
Speaker 5: on their websites, you have to click. Are you a researcher?
26:56
Speaker 5: You promise to only use for research. This is not
26:59
Speaker 5: for human use. It's all over the place. But they
27:00
Speaker 5: sell to individuals, not to Stanford or Harvard or University
27:03
Speaker 5: of Illinois. They're not selling it to research centers. They're
27:06
Speaker 5: selling it to individuals. So there's this whole industry in
27:09
Speaker 5: the United States called the research-use-only peptide companies, thousands of them,
27:14
Speaker 5: that got out of the gate, bought peptides, directly active
27:17
Speaker 5: pharmaceutical ingredient from makers in China. Some of them, FDA registered,
27:21
Speaker 5: some of them not. And they sell direct to consumers
27:26
Speaker 5: from their webpages with no doctor, no prescription, anything. That
27:30
Speaker 5: circumvents the prohibitions on compounding pharmacies. And also they sell
27:35
Speaker 5: at greatly reduced prices. They really got their jump three,
27:39
Speaker 5: four years ago when semaglutide and terzeptide, you know, Ozempic
27:43
Speaker 5: and Wagovi, all were like $ 1, 200 a month. And these
27:47
Speaker 5: guys were selling it for $ 150 or $ 175 a month.
27:50
Speaker 1: So are they selling these drugs illegally then?
27:54
Speaker 5: It is not lawful to sell unapproved drugs, which is
27:58
Speaker 5: what these are. Most of the peptides are unapproved drugs.
28:02
Speaker 5: Terzepatide and semaglutide are approved drugs, but you have to
28:06
Speaker 5: get a prescription from your doctor, and that's how you
28:08
Speaker 5: get semaglutide and terzepatide. There's a small exception here. for
28:14
Speaker 5: compounding pharmacies that when a doctor says, I need this
28:18
Speaker 5: semaglutide mixed with B12 or something for this patient in particular,
28:24
Speaker 5: then it's lawful for the compounding pharmacy to formulate that.
28:28
Speaker 5: But compounding pharmacies have been using that sort of as
28:31
Speaker 5: an excuse to just continue making terzapatide and semaglutide. And
28:35
Speaker 5: almost two months ago, FDA sent a warning letter to
28:38
Speaker 5: a big compounding pharmacy kind of stating, hey, we're onto
28:41
Speaker 5: your game. You can't just add a second component. We
28:44
Speaker 5: consider this just a pretext to continue selling that. So
28:48
Speaker 5: that's for terzepatide and semaglutide. But that research-use-only sector is 100%
28:54
Speaker 5: outside of the food, drug, and cosmetic sector. They are
28:57
Speaker 5: not in compliance. It is unlawful to sell for human
29:00
Speaker 5: use any of these peptides or GLP-1s. And that's when
29:06
Speaker 5: we get to Ritatrutide. Because these research-use-only peptide companies... are
29:12
Speaker 5: already selling Retatrutide for research only, quote unquote, because they
29:16
Speaker 5: can access the active pharmaceutical ingredient from Chinese API manufacturers.
29:21
Speaker 5: And the drug has not even been approved by FDA.
29:24
Speaker 5: Lilly has spent hundreds of millions of dollars in getting
29:28
Speaker 5: all the clinical trials, phase one, two, three. And I
29:32
Speaker 5: believe that in the first quarter of next year, they
29:35
Speaker 5: will make their submission to FDA for final approval. But
29:38
Speaker 5: in the meantime... industrious entrepreneurs in the United States who
29:43
Speaker 5: are selling direct to consumer are already selling red at
29:47
Speaker 5: true tide. And that's why we have the very, I'd say,
29:51
Speaker 5: robust response from Lilly.
29:54
Speaker 1: Lilly has filed 11 lawsuits against a range of online
29:58
Speaker 1: vendors and wellness clinics making copycat versions of its experimental drug, retatrutide.
30:05
Speaker 1: And they're using a different approach than they used years
30:08
Speaker 1: ago against copycat versions of its tricepatides, Zepound and Monjaro.
30:14
Speaker 5: When they were pushing back on the RUO version of tricepatide,
30:19
Speaker 5: They used the argument like you're violating the Food, Drug,
30:21
Speaker 5: and Cosmetics Act. You haven't gone through clinical trials. This
30:24
Speaker 5: is an unapproved drug. When they were doing that, they
30:26
Speaker 5: sent thousands of cease and desist letters to companies essentially
30:30
Speaker 5: saying you're violating the Food, Drug, and Cosmetics Act. And
30:34
Speaker 5: the response was, okay, you're not the FDA. You don't
30:37
Speaker 5: get to enforce the Food, Drug, and Cosmetics Act. And
30:40
Speaker 5: there's no private enforcement of the Food, Drug, and Cosmetics Act.
30:44
Speaker 5: So that had limited success. Lilly learned from that experience,
30:48
Speaker 5: and their lawyers have learned from that experience. That is
30:51
Speaker 5: not what they're doing now. With Reta True Tide, they're
30:54
Speaker 5: using state laws, unfair competition, and also a violation of
31:00
Speaker 5: state regulations selling unregistered drug. You know, those are all
31:03
Speaker 5: state violations. They're going to have a lot more traction
31:07
Speaker 5: with these causes of action that they're using.
31:10
Speaker 1: And Lilly's taking a multi-pronged approach. Explain how they're providing
31:15
Speaker 1: information to state and federal regulators.
31:19
Speaker 5: They're basically notifying state and federal authorities, but not just
31:24
Speaker 5: notifying them. You know, they sued 11 companies already for
31:27
Speaker 5: the sale of Reta Trutite, and they put together files
31:31
Speaker 5: that they share with state attorneys general, state boards of pharmacy. FDA.
31:36
Speaker 5: So they're doing sort of the work that the federal
31:38
Speaker 5: and the state agencies sometimes don't have the bandwidth to
31:41
Speaker 5: do themselves. And Lilly wants to protect its brand new
31:45
Speaker 5: drug that up until now, they've only spent money developing.
31:48
Speaker 5: They haven't gotten a dime back in profit yet. And
31:52
Speaker 5: they already have to go out and protect their brand
31:55
Speaker 5: new and much more efficacious, has a lot of advantages
31:58
Speaker 5: over triseptide and semaglutide. So it's going to be a
32:01
Speaker 5: multi-billion dollar drug. And I think Lilly quite correctly is
32:06
Speaker 5: defending its intellectual property and its investment. And if regulatory
32:10
Speaker 5: agencies had the bandwidth and the manpower, let's look at FDA, right?
32:14
Speaker 5: The major regulator for approved or unapproved drugs. They send
32:18
Speaker 5: out warning letters all the time, etc. But they lost
32:20
Speaker 5: 3,500 employees under Doge. And I've been practicing FDA regulatory
32:27
Speaker 5: law for 24 years. And Endemically, FDA has always had
32:32
Speaker 5: not enough budget and not enough bandwidth to properly enforce
32:36
Speaker 5: all the important rules that they're charged with enforcing. Therefore, post-DOJ,
32:41
Speaker 5: they're really hamstrung. And so these are sort of the
32:44
Speaker 5: consequences of all of that in part. right? It's a
32:48
Speaker 5: perfect storm because of semaglutide and triseptide and peptides in general.
32:52
Speaker 5: This all came right after the COVID epidemic. And so
32:56
Speaker 5: what came out of that is this whole new sector
32:58
Speaker 5: and regulators could not close the barn doors soon enough.
33:02
Speaker 5: They're still wide open. And so there's hundreds, if not
33:05
Speaker 5: thousands of research use only peptide sellers, and it would
33:08
Speaker 5: take a monumental enforcement action to actually put a dent
33:14
Speaker 5: into the research use only peptide companies.
33:17
Speaker 1: Why isn't Eli Lilly suing for infringement of the patents
33:21
Speaker 1: it has on these drugs?
33:23
Speaker 5: You know, as a FDA regulatory attorney and having been
33:27
Speaker 5: in this space for a couple of decades, I know that,
33:30
Speaker 5: you know, the obvious cause of action should be you're
33:35
Speaker 5: infringing on our patents. We have patents for Terzapatide, for Retrotrutide, right?
33:41
Speaker 5: But if there's a fight between biotech companies and one
33:44
Speaker 5: company says, You're infringing on my patent. The accused company
33:48
Speaker 5: will respond, no, we're not because your patent is invalid.
33:52
Speaker 5: And they'll go to the USPTO and ask for a
33:54
Speaker 5: re-examination of that patent. And many times those patents get
33:57
Speaker 5: narrowed or canceled, a good percentage of that. And Lilly
34:01
Speaker 5: would never endanger the patent portfolios that underlie these billion
34:07
Speaker 5: dollar drugs. So they're never using that argument because the
34:11
Speaker 5: counter argument would be, oh, we're going to go and
34:14
Speaker 5: attack your patent. So they never use that cause of action,
34:17
Speaker 5: which you would think would be the logical cause of action.
34:20
Speaker 5: And so they use everything else. Their first attempt was
34:23
Speaker 5: you're violating the Food, Drug, and Cosmetics Act. That didn't
34:26
Speaker 5: work that well. Now what they're doing with state law,
34:29
Speaker 5: unfair competition, and doing the legwork for regulatory agencies by
34:35
Speaker 5: putting files together with all the evidence so that a
34:39
Speaker 5: board of medicine in Iowa can or the attorney general
34:44
Speaker 5: in Florida has already a file with all the evidence
34:48
Speaker 5: to initiate an enforcement action. And I think that basically
34:52
Speaker 5: Lilly is doing the legwork for regulatory agencies and giving
34:56
Speaker 5: them something that is going to be much more effective.
34:58
Speaker 5: You know, I've already seen some investigations from state agencies
35:04
Speaker 5: on red or true tide sales. And I know that
35:06
Speaker 5: those are linked to what Lilly is doing. So they
35:09
Speaker 5: have a multi-pronged approach that I think is going to
35:11
Speaker 5: be effective.
35:12
Speaker 1: Does Lilly have a bottom line on how much it
35:14
Speaker 1: will spend to defend red or true tide before the
35:18
Speaker 1: drug is even out?
35:19
Speaker 5: I have no inside information on any of that stuff.
35:23
Speaker 5: But I believe that Terzepatide last year, I think it
35:26
Speaker 5: was like $ 42 billion, something around there, that they sold
35:30
Speaker 5: erythritides is going to be much bigger. And so essentially
35:34
Speaker 5: they have the capital to defend as vigorously as they
35:38
Speaker 5: want to. And they should, you know, they've worked very hard.
35:41
Speaker 5: They've developed this. This is how our system works. But,
35:44
Speaker 5: you know, thousands of horses got out of the barn
35:48
Speaker 5: and we have, you know, three regulators walking by themselves,
35:51
Speaker 5: trying to grab one or the other is the way
35:53
Speaker 5: I see it. There are thousands of doses of peptides
35:57
Speaker 5: and GLP-1s that are purchased from research use only companies
36:01
Speaker 5: being injected every week in the United States. I've never
36:05
Speaker 5: in my career seen such a huge uptake of unapproved drugs.
36:10
Speaker 5: These are not coming under a doctor's scrutiny, not coming
36:13
Speaker 5: from a pharmaceutical company, are not FDA approved. But what
36:17
Speaker 5: we're not seeing is the tidal wave of emergency room
36:21
Speaker 5: visits because many times these active pharmaceutical ingredients are the
36:26
Speaker 5: actual drug. That's the problem. That's why they're so popular.
36:30
Speaker 5: They have not been lawfully acquired through the systems complying
36:34
Speaker 5: with the Food, Drug, and Cosmetics Act, but they get realtors' appetite.
36:38
Speaker 5: I'm not saying all the time because they're not regulated
36:41
Speaker 5: by FDA, so they don't have to operate at GMP.
36:45
Speaker 5: They don't have to have all the sterility SOPs. But
36:48
Speaker 5: some of them do. Now, it's still risky because you
36:51
Speaker 5: might buy from one of these companies that doesn't do
36:54
Speaker 5: all of that. It's hit or miss since they're outside
36:57
Speaker 5: the regulatory system, and that's dangerous.
36:59
Speaker 1: You never know what you're getting. Thanks for sharing your insights, Edgar.
37:02
Speaker 1: That's Edgar Acebe, a partner at Fryer Levitt. And that's
37:06
Speaker 1: it for this edition of the Bloomberg Law Show. Remember,
37:09
Speaker 1: you can always get the latest legal news on our
37:11
Speaker 1: Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify,
37:15
Speaker 1: and at www.bloomberg.com slash podcast slash law. And remember to
37:21
Speaker 1: tune into the Bloomberg Law Show every weeknight at 10 p.m.
37:25
Speaker 1: Wall Street time. I'm June Grosso, and you're listening to Bloomberg.