Latest / Bloomberg Law / Weekend Law: Tariffs, Comey's Defense, Michael Jordan & NASCAR

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Weekend Law: Tariffs, Comey's Defense, Michael Jordan & NASCAR · Bloomberg Law

0:02
Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.
0:08
Speaker 2: Why do you think Presidents Clinton, Bush Obama have not.
0:15
Speaker 3: Used i EPA to impose tariffs?
0:18
Speaker 4: It's one of the most important cases of the term,
0:21
Speaker 4: a test of presidential power where President Trump's signature economic
0:26
Speaker 4: policy is at stake and a decision against him could
0:30
Speaker 4: mean refunding of more than one hundred billion dollars. And
0:34
Speaker 4: after nearly three hours of oral arguments on Wednesday, it
0:39
Speaker 4: appears that Supreme Court justices across the ideological spectrum are
0:44
Speaker 4: skeptical that Trump has the legal authority to impose billions
0:49
Speaker 4: of dollars in tariffs. Chief Justice John Roberts and Justice
0:53
Speaker 4: Sonya Sotomayor said, the tariffs are taxes, and the Constitution
0:58
Speaker 4: gives taxing power to Congress.
1:01
Speaker 5: It's a congressional power, not a presidential power to tax.
1:05
Speaker 5: And you want to say tariffs are not taxes, but
1:08
Speaker 5: that's exactly what they are, degenerating money from American citizens revenue.
1:14
Speaker 6: The vehicle is in position of taxes on Americans and
1:18
Speaker 6: that has always been the core power of Congress.
1:21
Speaker 4: Trump is arguing that the International Emergency Economic Powers Act,
1:25
Speaker 4: or AIPA gives him virtually unlimited powers to impose tariffs
1:30
Speaker 4: by executive order. But as several justices pointed out, the
1:35
Speaker 4: word tariffs is nowhere to be found in that law.
1:39
Speaker 4: Here are the Chief Justice and Justice Katanji Brown Jackson, Well, but.
1:43
Speaker 6: The exercise of the power is to impose tariffs, right,
1:47
Speaker 6: and the statute doesn't use the word tariffs.
1:50
Speaker 3: Your argument suggests that we should see the word imposed,
1:54
Speaker 3: the phrase impose tariffs in that same series of things
1:58
Speaker 3: that the president could do. We don't see that word,
2:01
Speaker 3: And instead you take regulate and say that must mean that.
2:06
Speaker 4: No other president has tried to impose tariffs under AJEPA,
2:10
Speaker 4: and Justice Neil Gorsuch, a Trump appointdee, expressed alarm at
2:15
Speaker 4: the idea that Congress could delegate such seemingly unlimited power
2:20
Speaker 4: to the president.
2:22
Speaker 2: Congress, as a practical matter, can't get this power back
2:25
Speaker 2: once it's handed it over to the President's a one
2:27
Speaker 2: way ratchet toward the gradual but continual accretion of power
2:33
Speaker 2: in the executive branch and away from the people's elected representative.
2:36
Speaker 4: All three lower courts that ruled on the issue found
2:40
Speaker 4: the tariffs to be unlawful. My guest is Timothy Bright Bell,
2:44
Speaker 4: partner and co chair of the International Trade practice at
2:47
Speaker 4: Wiley Rhin. Tim tell us what's at stake in this case.
2:52
Speaker 7: This case involves the centerpiece of President Trump's economic agenda.
2:59
Speaker 7: Is the biggest trade case the Supreme Court has ever heard,
3:01
Speaker 7: and it goes straight to the key constitutional issue of
3:06
Speaker 7: who has the power to impose tariffs, the US Congress
3:10
Speaker 7: or the president. President Trump says the law that he used,
3:14
Speaker 7: the International Emergency Economic Powers Act, gives him the power
3:18
Speaker 7: to regulate imports, and that that includes the power to
3:22
Speaker 7: impose tariffs, including ventanyl tariffs on China, Canada, and Mexico,
3:28
Speaker 7: and reciprocal economic tariffs on almost all countries. Whereas the
3:32
Speaker 7: plaintiffs in this case say that Congress has that power
3:35
Speaker 7: and cannot delegate that power, and that AEPA, which has
3:38
Speaker 7: never before been used to impose tariffs, does not include
3:42
Speaker 7: that power and afford So that is what is at stake.
3:45
Speaker 7: And of course the tariffs under AEPA have led to
3:50
Speaker 7: collection of hundreds of billions of dollars of tariffs already,
3:53
Speaker 7: so it's very high economic stakes for the companies and
3:57
Speaker 7: industries that it paid those tariffs as well.
4:00
Speaker 4: There's always a textual analysis these days, and many of
4:04
Speaker 4: the justices were concerned that the text of the statute
4:08
Speaker 4: doesn't mention the word tariffs at all exactly.
4:12
Speaker 7: The argument focused quite heavily on this law used by
4:16
Speaker 7: President Trump AIPA and whether that law, which gives the
4:20
Speaker 7: president the power to regulate imports, also includes the power
4:25
Speaker 7: to impose tariffs. That really dominated most of the hearing,
4:28
Speaker 7: and the justices asked very difficult questions on both sides.
4:33
Speaker 7: The administration said that the ability to impose tariffs is
4:37
Speaker 7: a core application of the ability to regulate imports in
4:41
Speaker 7: a historical context, said that, of course, the power to
4:46
Speaker 7: regulate imports would be read to include tariffs because tariffs
4:50
Speaker 7: have been used throughout our country's history. On the other hand,
4:53
Speaker 7: several justices were skeptical of that, and the plaintiffs in
4:56
Speaker 7: this case said that when the delegation and includes tariff authority,
5:02
Speaker 7: there is always specific language to that effect, and that
5:06
Speaker 7: there are always conditions and tests and agency decisions that
5:11
Speaker 7: have to go into that tariff power. So there was
5:14
Speaker 7: a good amount of the argument focused on those issues,
5:16
Speaker 7: and again, whether power to regulate imports includes the power
5:20
Speaker 7: to impose tariffs, and.
5:21
Speaker 4: What did you think about the Solicitor General's argument that
5:25
Speaker 4: the Trading with the Enemy Act of nineteen seventeen gives
5:29
Speaker 4: the president authority to impose these tariffs.
5:33
Speaker 7: The Solicitor General argued, yes, that the Trading with the
5:36
Speaker 7: Enemy Act was used to impose tariffs in a prior
5:41
Speaker 7: situation by President Nixon, and that there's no reason to
5:44
Speaker 7: think that anything had changed when AIPA had passed. On
5:48
Speaker 7: the other hand, the plaintiffs had a response to that
5:51
Speaker 7: in terms of the fact again that when tariffs are involved,
5:57
Speaker 7: there are always conditions on their use, there are always
5:59
Speaker 7: specific procedures, and also the fact that the reality is
6:03
Speaker 7: that no other president in fifty years has used AIPA
6:08
Speaker 7: to impose tariffs.
6:09
Speaker 4: The Major Questions doctrine came up several times during the arguments.
6:14
Speaker 4: It basically says that when the executive branch takes an
6:18
Speaker 4: action with major political or economic significance, Congress has to
6:24
Speaker 4: have expressly authorized it, and the Chief Justice made it
6:28
Speaker 4: fairly clear that he thought the Major Questions doctrine applies here.
6:34
Speaker 7: Yes, So the question here is, does the Major Questions
6:37
Speaker 7: doctrine require a clear statement in AIPA that it includes
6:42
Speaker 7: the power to impose tariffs, and this Court has not
6:46
Speaker 7: hesitated to start using that doctrine more broadly. But I
6:52
Speaker 7: think you're right that the justices had some concerns about
6:56
Speaker 7: pursuing it in this venue. And again, the question comes
7:00
Speaker 7: to is the power to tariff implied in the power
7:04
Speaker 7: to regulate imports or if it's not. Was this a
7:08
Speaker 7: question that Congress was required to state clearly that tariffs
7:13
Speaker 7: were a part of what was envisioned by the new law.
7:17
Speaker 4: The Conservatives us the Major Questions doctrine to block several
7:22
Speaker 4: of President Biden's initiatives, like his student loan forgiveness program.
7:27
Speaker 4: If they allow Trump to impose these tariffs, do you
7:31
Speaker 4: think they'll have to explain why the Major Questions doctrine
7:34
Speaker 4: applied to Biden but not Trump.
7:38
Speaker 7: I think it's an interesting question whether they'll go there
7:40
Speaker 7: or whether they will just focus on the language of
7:43
Speaker 7: AIBA and this issue of whether the power to regulate
7:46
Speaker 7: imports includes the power to tariff, and I think several
7:50
Speaker 7: justices went down that road. I don't think just because
7:54
Speaker 7: these doctrines have been used in other cases, such as
7:56
Speaker 7: the Biden student bond forgiveness case doesn't necessary mean that
8:00
Speaker 7: they will have to address it in this opinion if
8:03
Speaker 7: they have other bases for finding that the tariffs were
8:07
Speaker 7: legal or improper in any way.
8:10
Speaker 4: And Justice Gorsuch in particular expressed alarm about the seeming
8:16
Speaker 4: lack of limitations on the powers the President was claiming here.
8:21
Speaker 7: Justice of course the hypothetical of if Congress can delegate
8:25
Speaker 7: the tariff authority, what would prohibit Congress from delegating everything,
8:30
Speaker 7: including the power to declare war, which is clearly given
8:33
Speaker 7: in the Constitution to Congress. And so that was a
8:37
Speaker 7: very interesting discussion. I'm certainly raising some concerns about the limits,
8:43
Speaker 7: if any, on the authority that the government was claiming.
8:47
Speaker 4: So where do you think the justices are going to
8:49
Speaker 4: come out here?
8:50
Speaker 7: Well, I'm not in the business of making predictions. Generally.
8:54
Speaker 7: My own personal view is that the Court's three Democratic
8:57
Speaker 7: justices probably vote against these tariffs. And the question is
9:00
Speaker 7: whether some of the majority of the Court have similar
9:04
Speaker 7: concerns about the president's use of this law. And I
9:07
Speaker 7: do think that it's still a very close decision. It
9:10
Speaker 7: could go either way. I thought Chief Justice Roberts and
9:14
Speaker 7: Justice Barrett and Justice Gorsich were perhaps more skeptical of
9:18
Speaker 7: the president's tariff authority under a than the other justices. Yues.
9:23
Speaker 7: The only other point I would make is, although it
9:26
Speaker 7: was discussed in the oral argument, I have a hard
9:29
Speaker 7: time seeing this court making a split decision that some
9:33
Speaker 7: of President Trump's tariffs are acceptable but others are not.
9:37
Speaker 4: So if the Court does rule against Trump, what happens
9:41
Speaker 4: next as far as his tariffs are concerned.
9:43
Speaker 7: Well, two things would happen. First of all, there would
9:46
Speaker 7: likely be some sort of a refund process for importers
9:49
Speaker 7: that paid the tariffs during this time, and there is
9:52
Speaker 7: some precedent for that before That was discussed during the
9:55
Speaker 7: oral argument a situation where the court struck down a
9:58
Speaker 7: harbor maintenance tax and there was basically a process where
10:02
Speaker 7: companies could file claims for the amount of the tax
10:05
Speaker 7: that they paid. So Justice Barrettz was concerned that this
10:08
Speaker 7: could be a mess and could be very unwieldy. I
10:11
Speaker 7: guess the more important point is what will the president
10:13
Speaker 7: do going forward? And I think it's clear that tariffs
10:17
Speaker 7: are still a cornerstone of this administration's economic policy. And
10:21
Speaker 7: if the Court says that the President cannot use AIPA,
10:26
Speaker 7: the President will likely pivot to one of several other
10:30
Speaker 7: trade tools that are available, and the Court mentioned many
10:34
Speaker 7: of these, including Section one twenty two, the section two
10:38
Speaker 7: thirty two, the National Security Law, which the administration has
10:41
Speaker 7: already made quite a bit of use of in this administration,
10:45
Speaker 7: Section three zero one, and so forth. The limit on
10:48
Speaker 7: those laws is that they do require studies or actions
10:52
Speaker 7: by other agencies. So Section two thirty two requires a
10:55
Speaker 7: study and a report by the Commerce Department and consultation
10:59
Speaker 7: with the Defense Department in order to decide that imports
11:03
Speaker 7: of a certain product like semiconductors or pharmaceuticals are a
11:09
Speaker 7: threat to national security. Similarly, Section three oh one, which
11:13
Speaker 7: was the law used to impose tariffs on China during
11:17
Speaker 7: the first Trump administration, also requires a detailed study by
11:22
Speaker 7: the US Trade Representative with public inputs. So those tools,
11:26
Speaker 7: for the most part, cannot be used as quickly as
11:29
Speaker 7: AIPA was used by President Trump.
11:32
Speaker 4: This case was fast tracked by the court so a
11:35
Speaker 4: ruling could come as quickly as the end of the year.
11:38
Speaker 4: Thanks so much for joining me, tim that's Timothy Bright,
11:41
Speaker 4: Bill of Willie Rhin Coming up next to the Bloomberg
11:45
Speaker 4: Law show. Prosecutors get us scolding from the judge in
11:49
Speaker 4: the case against former FBI director James Comey. I'm June
11:53
Speaker 4: Grosso and you're listening to Bloomberg.
11:55
Speaker 2: My heart is broken for the Department of Justice, but
11:59
Speaker 2: I have great confidence in the federal judicial system.
12:02
Speaker 1: I'm innocent, so let's have a trial.
12:06
Speaker 4: But will the criminal case against former FBI director James
12:10
Speaker 4: Comy even get to trial. Comy is pleaded not guilty
12:14
Speaker 4: to the charges of lying to Congress in twenty twenty,
12:18
Speaker 4: and his defense has filed several motions to get the
12:21
Speaker 4: case dismissed before trial. They include emotion to dismiss because
12:26
Speaker 4: the government is engaged in a vindictive and selective prosecution,
12:31
Speaker 4: emotion to dismiss because the interim us attorney was appointed illegally,
12:36
Speaker 4: and emotion to dismiss because Comy's testimony was literally true.
12:42
Speaker 4: And on Wednesday, a clearly exasperated judge scolded the prosecutors
12:48
Speaker 4: for the Justice Department's indict first and investigate second approach
12:53
Speaker 4: to the case. Magistrate Judge William Fitzpatrick then ordered the
12:58
Speaker 4: prosecutors to turn over to the defense a raft of
13:01
Speaker 4: potential evidence, including full transcripts of the grand jury proceedings.
13:08
Speaker 4: My guest is former federal prosecutor Robert Mintz, a partner
13:11
Speaker 4: maccarter and English Bob. How unusual is it for a
13:15
Speaker 4: judge to make these kinds of remarks that the Justice
13:19
Speaker 4: Department here indicted first, an investigated second, and that the
13:23
Speaker 4: prosecutors may have mishandled some evidence.
13:27
Speaker 8: Well, it's very unusual for the judge to comment on
13:30
Speaker 8: the prosecutor's conduct and to comment on the evidence of
13:34
Speaker 8: the case this early in the process. And it suggests
13:37
Speaker 8: that the court, at least this judge, of the magistrate
13:40
Speaker 8: judge who was handling this argument, has some serious questions
13:44
Speaker 8: about the procedures used by prosecutors and whether or not
13:48
Speaker 8: they had really put together the evidence necessary to pursue
13:51
Speaker 8: this case. And the warning that he gave prosecutors with
13:54
Speaker 8: regard to mishandling evidence turns on this whole question of
13:59
Speaker 8: evidence seized from sirch warrants way back in twenty nineteen
14:03
Speaker 8: and twenty twenty in an unrelated investigation, And there's going
14:07
Speaker 8: to be an inquiry now into whether or not the
14:10
Speaker 8: information that prosecutor seesed many years ago is being properly
14:15
Speaker 8: utilized in this prosecution.
14:17
Speaker 4: And that evidence was seized from Comy's friend and former
14:20
Speaker 4: attorney Daniel Richmond as part of an internal investigation of
14:25
Speaker 4: leaks in the Russia case during the first Trump administration.
14:29
Speaker 4: Let's talk about the judge ordering the full grand jury
14:33
Speaker 4: transcripts to be handed over. That could be a treasure
14:37
Speaker 4: trove for the defense, which claims that there were severe
14:41
Speaker 4: and pervasive irregularities in the presentation to the grand jury
14:46
Speaker 4: by the newly installed interim US Attorney Lindsey Halligan, who
14:51
Speaker 4: had no experience as a prosecutor.
14:54
Speaker 8: It's not unusual for transcripts of witnesses who might appear
14:59
Speaker 8: before the grand jury to be turned over.
15:01
Speaker 9: To the defense. In fact, it's required.
15:03
Speaker 8: Prosecutors generally prefer not to have witnesses who are favorable
15:08
Speaker 8: to the government testify in the grand jury because then
15:12
Speaker 8: those statements and that testimony has to be turned over
15:15
Speaker 8: to the defense, and it provides defense lawyers fodder for
15:18
Speaker 8: cross examination if the witness testifies at trial in any
15:22
Speaker 8: way differently or inconsistently with the testimony they gave before
15:26
Speaker 8: the grand jury.
15:27
Speaker 9: But what's going to be interesting here for the.
15:29
Speaker 8: Defense team is not so much what was said from
15:33
Speaker 8: the witness, who in this case was an FBI agent
15:36
Speaker 8: who is simply summarizing the case, but the questions that
15:39
Speaker 8: were posed by the prosecutor in this case, the interim
15:43
Speaker 8: US attorney Lindsay Halligan, how she presented the case to
15:46
Speaker 8: the grand jurors, how she presented the law to the
15:49
Speaker 8: grand jurors, how she may have answered any questions that
15:53
Speaker 8: grand jurors raised. Because what happens during the grand jury
15:57
Speaker 8: process is that there's a grand jury foreman and the
16:00
Speaker 8: grand jury formant has a conversation, often when the prosecutor
16:03
Speaker 8: is outside of the grand jury room, and then the
16:06
Speaker 8: foreman will ask questions on behalf of all the grand jurors.
16:09
Speaker 8: That happens fairly frequently, and in this case, we know
16:13
Speaker 8: that the grand jurors decided not to return an indictment
16:16
Speaker 8: on one of the three counts, So there's no question
16:19
Speaker 8: that there was some significant conversation and debate going on
16:23
Speaker 8: among the grand jurors and probably a number of questions
16:26
Speaker 8: that were posed to the prosecutor. The defense team is
16:29
Speaker 8: going to be very interested in seeing how Lindsey Halligan
16:33
Speaker 8: answered those questions, and they're going to be looking to
16:36
Speaker 8: see whether there's anything she did that they will argue
16:40
Speaker 8: was improper in front of that grand jury that could
16:43
Speaker 8: possibly taint the entire indictment. And if they can ultimately
16:46
Speaker 8: convince the judge that the irregularities are serious enough so
16:50
Speaker 8: that it taints the entire grand jury process and that
16:52
Speaker 8: indictment is thrown out, they may well have won their
16:56
Speaker 8: case because the station of limitations, I'm sure they will argue,
16:59
Speaker 8: has now expired.
17:01
Speaker 4: Apparently the government is concerned about turning over the grand
17:04
Speaker 4: jury transcripts because they agreed to turn over the evidence
17:08
Speaker 4: ceased from Richmond, but they're appealing the magistrate judges ordered
17:12
Speaker 4: to turn over the grand jury transcripts.
17:15
Speaker 8: Well, that's not surprising that they are appealing that, because again,
17:19
Speaker 8: it's so unusual for defense lawyers to get the actual presentation,
17:24
Speaker 8: and it's quite possible that there were some statements that
17:27
Speaker 8: were made that could be problematic for prosecutors. So they
17:31
Speaker 8: have now appealed the magistrate judge's decision that's requiring them
17:35
Speaker 8: to turn over the grand jury material to the district
17:38
Speaker 8: court judge, and they're basically arguing that the magistrate judge
17:42
Speaker 8: exceeded his authority in ordering the grand jury transcripts to
17:46
Speaker 8: be turned over. They are arguing that the defense team
17:49
Speaker 8: had already fought in motion to seek to get access
17:52
Speaker 8: to the grand jury presentation, and that that was pending
17:56
Speaker 8: before the District Court judge, and that the magistrate judge
18:00
Speaker 8: was at that point only appointed to deal with a
18:04
Speaker 8: question of potential privileged materials, and in requiring that the
18:07
Speaker 8: grand jury material be turned over, he went beyond the
18:11
Speaker 8: scope of the authority that was delegated to him by
18:15
Speaker 8: the District Court Judge.
18:16
Speaker 4: Bob in terms of the motion to dismiss the indictment
18:19
Speaker 4: because Lindsay Halligan was illegally serving when she brought the
18:23
Speaker 4: charges against Comy. US Attorney General Pam Bondy filed a
18:28
Speaker 4: court document on Monday saying that she had retroactively given
18:34
Speaker 4: Halligan the additional title of Special Attorney. I mean, I
18:39
Speaker 4: too would like to go back in time and correct
18:41
Speaker 4: some of my mistakes. But will a court allow her
18:44
Speaker 4: to go back to September and basically say, oh, I
18:48
Speaker 4: meant to give her this title too.
18:50
Speaker 8: I think the argument by the Attorney General that she
18:53
Speaker 8: can retroactively give Eastern Virginia's top prosecutors an extra title
18:58
Speaker 8: in order to try to defend against the claims that
19:01
Speaker 8: Halligan was improperly appointed is probably not going to gain
19:05
Speaker 8: a lot of traction with the courts.
19:07
Speaker 9: Typically, the courts will look.
19:09
Speaker 8: At the facts at the time and whether or not
19:11
Speaker 8: the appointment was proper under the rules, under the regulations,
19:15
Speaker 8: under the statues.
19:16
Speaker 9: At the time of the appointment.
19:18
Speaker 8: And I think it's an uphill battle to argue that
19:20
Speaker 8: even if there was a deficiency, then that can be
19:23
Speaker 8: remedied retroactively by an appointment.
19:26
Speaker 4: In one of the motions to dismiss, the defense claims
19:29
Speaker 4: the indictment is hopelessly vague and defective on its face,
19:33
Speaker 4: that Senator ted Cruz's questions to Comy were fundamentally ambiguous
19:39
Speaker 4: and that Comy's response was literally true. Let's listen to
19:43
Speaker 4: the exchange between Cruz and Komy.
19:46
Speaker 2: What mister McKay is saying and what you testify to
19:50
Speaker 2: this committee cannot both be true. One or the other
19:53
Speaker 2: is false. Who's telling the truth?
19:56
Speaker 1: I just can only speak to my testimony.
19:58
Speaker 10: I stand by what the test money you summarized that
20:01
Speaker 10: I gave in May of twenty seventeen.
20:03
Speaker 4: So the defense wants the prosecution to tell them which
20:06
Speaker 4: of Komy's statements are you claiming were false?
20:11
Speaker 8: Yeah, And that's exactly why false statement prosecutions are extremely difficult,
20:16
Speaker 8: because you have to parse through exactly what was the
20:19
Speaker 8: question and what was the answer and demonstrate that at
20:23
Speaker 8: the time the answer was given, it was not only false,
20:26
Speaker 8: but it was intentionally false, and that it was false
20:29
Speaker 8: about something that was material. So in this case, the
20:33
Speaker 8: prosecution is based on hearing before the Senate Judiciary Committee
20:36
Speaker 8: on September thirtieth, twenty twenty, and at that hearing, Senator
20:40
Speaker 8: Ted Cruz asked mister Comy whether he had authorized someone
20:43
Speaker 8: at the FBI to be an anonymous.
20:46
Speaker 9: Source in news reports.
20:48
Speaker 8: The indictment says that mister Comy misled the committee by
20:50
Speaker 8: saying that he had not done so. Now, Comy's lawyers
20:53
Speaker 8: have attacked that indictment by saying that the questioning by
20:56
Speaker 8: mister Cruz was vague and imprecise, and point out that
21:01
Speaker 8: at the time that Senator Cruz was questioning mister Comy
21:04
Speaker 8: about whether he had authorized anybody to leak information, that
21:07
Speaker 8: Senator Cruz was referring to Andrew McCabe, who once served
21:11
Speaker 8: as mister Comy's deputy at the FBI, and was not
21:14
Speaker 8: referring to Daniel Richman, who had been a former FBI
21:18
Speaker 8: employee and later became the attorney for James Comy. So
21:21
Speaker 8: they're arguing that the indictment is defective on its face,
21:25
Speaker 8: because in order to prove that mister Comy lied, you
21:28
Speaker 8: have to show that there was a clear question and
21:31
Speaker 8: that he gave a clearly false, a knowingly false answer
21:34
Speaker 8: to it, and that he had an intention to mislead
21:37
Speaker 8: the committee, and that the information he provided that was
21:40
Speaker 8: false was material, and that this somehow obstructed the relevant
21:43
Speaker 8: congressional proceeding. They say that that information is not contained
21:47
Speaker 8: in the indictment, and one of their emotions is the
21:50
Speaker 8: requirement that the government provide that information.
21:53
Speaker 9: So what you have here basically.
21:55
Speaker 8: Is an argument that the indictment is defective on its face. So,
21:59
Speaker 8: in other words, it's not had an argument that the
22:01
Speaker 8: government has its facts throng, because a factual dispute is
22:04
Speaker 8: something that has to.
22:05
Speaker 9: Be resolved by a jury at trial.
22:07
Speaker 8: They are arguing that this is a decision that really
22:10
Speaker 8: needs to be made by the judge because on its face,
22:13
Speaker 8: the government is unable to prove the charges. The allegations
22:17
Speaker 8: in the indictment simply are not enough to sustain a
22:21
Speaker 8: valid conviction, and that's why they're filing this whole slew
22:24
Speaker 8: of arguments to try to get this case dismissed before
22:28
Speaker 8: it ever goes to trial.
22:29
Speaker 4: And prosecutors would not be able to bring the charges
22:33
Speaker 4: again because the statute of limitations has run out, and
22:37
Speaker 4: supposedly that's why the indictment was rushed through. Comy's indictment
22:42
Speaker 4: came just five days after President Trump had demanded on
22:47
Speaker 4: truth Social that Attorney General Pam Bondi bring charges against Komy,
22:53
Speaker 4: New York Attorney General Letitia James, and Senator Adam Schiff.
22:57
Speaker 4: So legal experts were talking about as selective and vindictive
23:01
Speaker 4: prosecution motion even before the defense made that motion in
23:06
Speaker 4: the case. Comy's motion papers include a sixty page long
23:11
Speaker 4: list of links that detail Trump's negative comments about him
23:16
Speaker 4: over the years. How strong is their vindictive prosecution motion?
23:21
Speaker 4: I know it's very hard to get a case dismissed
23:24
Speaker 4: on those grounds, That's exactly right.
23:27
Speaker 8: I mean, motions for vindictive prosecution.
23:29
Speaker 9: Are exceedingly hard to win.
23:31
Speaker 8: They require defendants to prove the prosecutors have displayed animus
23:35
Speaker 8: towards them while they were seeking to exercise their rights,
23:39
Speaker 8: and that the charges never would have been brought except
23:42
Speaker 8: for that animus. Now, prosecutors have argued in response that
23:45
Speaker 8: the comments made by President Trump to prosecute mister Komy
23:50
Speaker 8: were only suggesting that if mister Komy committed a crime,
23:54
Speaker 8: that they ought to prosecute him, and that he was
23:56
Speaker 8: not directing the Department of Justice to prosecute mister Komey
24:00
Speaker 8: regardless of whether or not a crime was committed. We'll
24:02
Speaker 8: have to see how the judge handles that at the
24:04
Speaker 8: end of the day. But the vindictive prosecution standard is
24:07
Speaker 8: fairly high and that may be a difficult argument for
24:11
Speaker 8: the defense to prevail on.
24:12
Speaker 4: We'll see how it goes at the hearings next week.
24:15
Speaker 4: Thanks for a great conversation, Bob. That's former federal prosecutor
24:19
Speaker 4: Robert Mintz of McCarter and English. Coming up next on
24:23
Speaker 4: the Bloomberg Law Show, Michael Jordan's racing team scores a
24:28
Speaker 4: key victory in court in its antitrust lawsuit against NASCAR.
24:33
Speaker 4: I'm June Grosso and you're listening to Bloomberg.
24:36
Speaker 10: Look I've been a fan of the game for a
24:37
Speaker 10: long period of time, you know, and you know, when
24:40
Speaker 10: we first started this coal process, I've always said that
24:43
Speaker 10: y'all want to fight for the betterment of the sport.
24:46
Speaker 4: You know.
24:46
Speaker 10: Even though they try to point out that, you know,
24:48
Speaker 10: we made you know, some money, or we had successful business,
24:52
Speaker 10: that's not the point. The point is is that the
24:54
Speaker 10: sport itself needs to continually change for the better for
24:57
Speaker 10: the fans as well as for the teams as well
24:59
Speaker 10: as from NASCAR tooth.
25:00
Speaker 4: They understand that Michael Jordan's racing team scored a huge
25:04
Speaker 4: win off the track in its anti trust case against NASCAR.
25:09
Speaker 4: Jordan's twenty three to eleven racing team and front Row
25:12
Speaker 4: Motorsports claimed that NASCAR acts like an illegal monopoly in
25:18
Speaker 4: a dispute that centers on new charter agreements which both
25:22
Speaker 4: teams refuse to sign, and on Tuesday, a federal judge
25:26
Speaker 4: agreed that NASCAR controls the market for premier stock car
25:30
Speaker 4: racing and granted partial summary judgment to the two racing teams.
25:36
Speaker 4: The decision turns up the pressure to settle ahead of
25:39
Speaker 4: the December one trial date. Although Jordans says he's ready
25:43
Speaker 4: for trial.
25:44
Speaker 10: I look forward to going down on the fire. If
25:47
Speaker 10: I have to fight this to the end for the beliment.
25:49
Speaker 1: Of the sport, I will do that.
25:51
Speaker 4: Joining me is anti trust law expert Harry First, a
25:54
Speaker 4: professor at NYU Law School. Harry explained Michael Jordan's anti
25:59
Speaker 4: trust case against NASCAR.
26:01
Speaker 6: This is a tussle between the family that has controlled
26:05
Speaker 6: NASCAR and I guess stock car racing for many years,
26:09
Speaker 6: almost uniquely in sports.
26:11
Speaker 1: You know, most sports.
26:13
Speaker 6: Are controlled by groups of team owners, but this is
26:16
Speaker 6: one that's only controlled by one family, this France family.
26:21
Speaker 6: You know, I guess It's had its ups and downs,
26:22
Speaker 6: but it's pretty up now.
26:25
Speaker 1: You know.
26:25
Speaker 6: They're sort of the only real game in town for
26:29
Speaker 6: the top Line Cup racing. There basically been arguments between
26:34
Speaker 6: the owners of these racing teams and the Frances over
26:40
Speaker 6: who's going to sort of split the money, particularly broadcast revenue.
26:44
Speaker 6: I think they both need each other. Race car owners
26:48
Speaker 6: need tracks to race on, and NASCAR, you know, has
26:51
Speaker 6: made itself through a series of moves, acquisitions and so forth,
26:55
Speaker 6: is basically the only place where you can have these
26:58
Speaker 6: high level races. And of course you've got to have
27:01
Speaker 6: the race cars racing or else you've got nothing to show.
27:06
Speaker 6: So they both need each other. But apparently the racing
27:09
Speaker 6: teams have not been hugely profitable unlike other sports. It's
27:15
Speaker 6: very expensive to maintain these, according to the litigation anyway,
27:19
Speaker 6: and the Frances, So the plaintiffs say, the plaintiff's being
27:23
Speaker 6: two of these teams, and one being this twenty three
27:26
Speaker 6: to eleven racing, which is Michael Jordan's. The plaintiffs say
27:29
Speaker 6: that the Frances take most of the revenue, particularly the
27:33
Speaker 6: broadcast revenue, and we're not getting enough, you know. The
27:37
Speaker 6: Francis say, well, you don't like it, take it or
27:39
Speaker 6: leave it, and that's when the litigation particularly broke out.
27:43
Speaker 4: It sounds like anti trust to me, but sounds like yeah,
27:47
Speaker 4: sounds like it.
27:48
Speaker 7: Is it?
27:48
Speaker 4: So this partial summary judgment was about the relevant market,
27:53
Speaker 4: which we've talked about before is key to anti trust.
27:57
Speaker 6: So the litigations had a little back and forth. The
28:00
Speaker 6: district court judge seems pretty well disposed of the plaintiff's claims,
28:05
Speaker 6: at one point issuing this injunction requiring NASCAR to admit
28:10
Speaker 6: the two teams into the I guess it was a
28:13
Speaker 6: twenty twenty four Circuit and the Court of Appeals knocked
28:17
Speaker 6: that down for various reasons.
28:19
Speaker 1: So the district.
28:21
Speaker 6: Court judge granted the plaintiff's motion for partial summary judgement.
28:26
Speaker 6: I mean, some of the important issues are now out
28:28
Speaker 6: of the case, and particularly, as you mentioned, this contentious
28:32
Speaker 6: issue over what's the relevant market. Is it just this
28:36
Speaker 6: NASCAR premiere racing market? Does it include you know, other
28:41
Speaker 6: kinds of stock car racing? There are other tiers? Does
28:45
Speaker 6: it include other motor sports? The game and anty trust
28:49
Speaker 6: if you're a defendant, is to constantly include different kinds
28:52
Speaker 6: of substitutes.
28:53
Speaker 1: Of what people would watch. But here the market is
28:56
Speaker 1: a labor.
28:57
Speaker 6: Market that they're arguing about, and the question is, you know,
29:01
Speaker 6: what are the choices available for these race car drivers
29:05
Speaker 6: who are selling their services? And this is basically it.
29:09
Speaker 6: So it looked like a pretty strong claim on market definition.
29:13
Speaker 6: But proving market definition is expensive, you know, requires lots
29:17
Speaker 6: of experts, and this is before you get to the jury,
29:20
Speaker 6: this summary judgment stage. But a lot of the record's
29:24
Speaker 6: been developed, and the district court judge sort of took
29:28
Speaker 6: an interesting turn on this. He said, well, if there's
29:31
Speaker 6: a dispute of fact, which there always is, in market definition.
29:35
Speaker 6: I think it's really broad. You know, while you could
29:39
Speaker 6: have lots of race car drivers, there are lots of
29:42
Speaker 6: choices that the race car drivers have. I think it's
29:45
Speaker 6: really narrow, say the plaintiffs. So lots of things to
29:48
Speaker 6: argue in front of a jury. But the judge says, ah,
29:51
Speaker 6: guess what, NASCAR you filed a counterclaim against these driver
29:57
Speaker 6: teams which had gotten together to jointly negotiate with NASCAR
30:03
Speaker 6: over these agreements that they're charges. So we're alleging that
30:08
Speaker 6: you sort of engage in a price fixing conspiracy. So
30:11
Speaker 6: they filed a counterclaim. Now, unfortunately for them, when you
30:15
Speaker 6: file a complaint in anty trust, normally you have to
30:20
Speaker 6: put in your complaint what the relevant market is. So
30:23
Speaker 6: they defined a market which was pretty much the same
30:26
Speaker 6: as the market that Michael Jordan defined, but basically the
30:31
Speaker 6: same labor market. It's these racing teams, you know, the
30:35
Speaker 6: premier stock car racing group, you know, at the very top.
30:39
Speaker 1: So they basically define the same market.
30:41
Speaker 6: So the judge says, sorry, you've already admitted it, and
30:45
Speaker 6: you know, we hold that you've made this admission. That's
30:48
Speaker 6: your admission, So we're done, and you're done and we
30:52
Speaker 6: don't have to try this issue. I'm sure that defendants
30:56
Speaker 6: and their lawyers were not all that happy with that,
30:59
Speaker 6: and I mean, I think it's pretty supportable on appeal,
31:02
Speaker 6: and there would have been ways to handle the complaint
31:05
Speaker 6: that didn't fall into this trap. But they were sort
31:09
Speaker 6: of too clever by half. It was a very clever counterclaim,
31:13
Speaker 6: but there was no requirement that they even needed to file.
31:16
Speaker 4: It is this sort of the ballgame.
31:17
Speaker 1: Then well it's not quite the ballgame.
31:20
Speaker 6: So the judge also did something else, not just the
31:22
Speaker 6: market definition, but you have to.
31:24
Speaker 1: Have monopoly power or in this case monops.
31:27
Speaker 6: A EE power as the sole buyer, and there have
31:30
Speaker 6: to be high barriers to entry, hard to get into
31:33
Speaker 6: this market. And the judge found on all of those things.
31:36
Speaker 6: You know, they've had this position for years and years
31:39
Speaker 6: as the sole buyer. It's very hard to have a
31:42
Speaker 6: competing leg. It's hard to even start your own racing team.
31:48
Speaker 6: They had estimates on that in the record. So the
31:51
Speaker 6: judge said, no, you've got this high entry barrier. It's
31:54
Speaker 6: very hard to enter. There are really no substitutes. There
31:58
Speaker 6: aren't other teams out there, you know, to race. So
32:02
Speaker 6: on the having monopoly or monopsony power interrelevant market is
32:07
Speaker 6: now out of the case, but that still leaves the
32:10
Speaker 6: question really two questions. One is they have to engage
32:15
Speaker 6: in some anti competitive conduct that maintains their monopoly position,
32:20
Speaker 6: and that's still going to go to trial, and that involves,
32:25
Speaker 6: you know, maybe their acquisitions of these other tracks, which
32:28
Speaker 6: they did. There were some exclusive agreements. There's this agreement
32:32
Speaker 6: that if you sign an agreement, you wave your.
32:34
Speaker 1: Anti trust claims. All of those will go together into
32:38
Speaker 1: a trial.
32:39
Speaker 6: And then there's the question of damages and that's going
32:42
Speaker 6: to be interesting because you know, the plaintiffs want more money.
32:47
Speaker 1: As a plaintiffs always won isay, you took too much,
32:50
Speaker 1: I didn't get enough. But they have to.
32:52
Speaker 6: Show what the competitive rate would be for these teams,
32:57
Speaker 6: and you know that's going to be a battle of
33:00
Speaker 6: they're economists. So there's still a distance to go. Maybe
33:04
Speaker 6: we'll never get there, and the parties are now going
33:06
Speaker 6: to settle. I don't know, but this I think was
33:08
Speaker 6: a pretty big win for the plaintiffs.
33:11
Speaker 4: They've had mediation sessions and private negotiations which obviously haven't worked.
33:17
Speaker 4: But after the last court hearing, Michael Jordan said, settlement
33:21
Speaker 4: has always been on the table, and the pressure is
33:24
Speaker 4: on when the trial date is coming up soon.
33:26
Speaker 6: And it seems to me what they're really arguing over
33:29
Speaker 6: is how do we split the pot so that the
33:32
Speaker 6: teams have enough money to invest in these fast cars
33:36
Speaker 6: and you know, all the things we need to do,
33:39
Speaker 6: and you know, at the end of the day, perhaps
33:42
Speaker 6: unfortunately for consumers, there's not going to be another circuit
33:46
Speaker 6: because these are private.
33:47
Speaker 1: Plaintiffs pursuing this.
33:48
Speaker 6: So the goal is not to split up nascars so
33:52
Speaker 6: there are competing circuits and you'd have real competition in
33:55
Speaker 6: this kind of racing. This is not Michael Jordan's goal.
34:00
Speaker 6: That's not the goal of private parties. The goal is
34:03
Speaker 6: to basically split the monopoly profits differently so they will
34:08
Speaker 6: likely benefit you know, consumers. I don't know, maybe not
34:12
Speaker 6: so much.
34:12
Speaker 4: If I'm the defendant. I don't want to be in
34:15
Speaker 4: a courtroom sitting opposite Michael Jordan with his star power.
34:19
Speaker 4: I mean, you know how juries are mesmerized right by stars.
34:24
Speaker 6: Asking for damages in a jury trial is a good move,
34:27
Speaker 6: particularly these days. I mean, juries have come in with
34:30
Speaker 6: some pretty big verdicts in these big cases against major defendants.
34:35
Speaker 1: You know, Google is one example. So, yeah, defendants have
34:39
Speaker 1: never liked Church. Let's put it that way.
34:42
Speaker 4: Yes, defendants do always seem to prefer a bench trial.
34:47
Speaker 4: Before I let you go, Harry, I just want to
34:48
Speaker 4: get your take on the bidding war between Pfizer and
34:53
Speaker 4: Novo Nordisk over the obesity drugs startup met Sarah, which
34:58
Speaker 4: has some antitrust implications. Pfizer had initially agreed to buy
35:02
Speaker 4: met Sarah for four point nine billion dollars in September
35:07
Speaker 4: and then let the bidding begin. The reports now are
35:10
Speaker 4: that Pfizer has matched Novo's ten billion dollar bid.
35:13
Speaker 6: This is an old fashioned bidding war. I keep saying
35:17
Speaker 6: to people, this is obviously a really fat market for profits.
35:20
Speaker 6: So the global market for weight loss drugs is now
35:24
Speaker 6: figured out about seventy two billion dollars and in another
35:28
Speaker 6: five years projected to be about one hundred and forty billion.
35:32
Speaker 6: I mean, this is huge money. This is sort of
35:35
Speaker 6: a fun fight, I guess, particularly if you're a shareholder
35:38
Speaker 6: of Metzarah. What I love is the revenues of met
35:42
Speaker 6: Sarah for this year have been zero. They don't have
35:46
Speaker 6: a product their weight loss drug is now entering Phase
35:51
Speaker 6: three clinical trials, which many but not all drugs get
35:56
Speaker 6: through successfully. So everyone's betting that this will go through
36:00
Speaker 6: through successfully. But it's not out yet and it hasn't
36:03
Speaker 6: been approved yet by the Food and Drug Administration. But
36:06
Speaker 6: Pfizer doesn't have a weight loss drug, and Novo Nordisk
36:11
Speaker 6: is having a lot of financial problems even though they
36:13
Speaker 6: probably have about fifty percent of the market, with those
36:17
Speaker 6: Zembic and Wagovi literally having the rest. You know, this
36:21
Speaker 6: is a market. It's not one hundred percent monopolized like NASCAR,
36:26
Speaker 6: but maybe larger implications for health and money than nascars.
36:30
Speaker 6: And the tactics that are being used are really quite
36:34
Speaker 6: interesting because Phizer is not only arguing that Novo Nordists,
36:40
Speaker 6: at least at a time higher bid, couldn't and shouldn't
36:43
Speaker 6: be accepted and so in violation of their agreement that
36:47
Speaker 6: they had, they've also filed the preemptive any trust case
36:51
Speaker 6: against Novo Nordisk and Metsera alleging that their agreement, this
36:57
Speaker 6: merger agreement is illegal.
36:59
Speaker 1: They've not only.
37:00
Speaker 6: Tried to stop it in Delaware Chancery Court, which has
37:04
Speaker 6: normal jurisdiction over corporate matters, but they've also filed in
37:08
Speaker 6: federal court in Delaware a separate any trust case. I'm
37:12
Speaker 6: alleging some very unusual things about this deal and alleging
37:17
Speaker 6: that the deal itself is illegal under the Sherman Act
37:21
Speaker 6: monopolization any competitive and under the Clayton Act, and the
37:25
Speaker 6: Federal Trade Commission has gotten involved a little bit as well.
37:29
Speaker 1: The FTC.
37:30
Speaker 6: You know, there's this shutdown that they haven't been able
37:33
Speaker 6: to do anything. Lo and behold, they awaken from their
37:36
Speaker 6: slumber and for the first time in almost a month,
37:39
Speaker 6: they granted early termination. You know, when you have a
37:43
Speaker 6: merger you have to file, you wait for thirty days
37:46
Speaker 6: at least to give the government forcers time to at
37:51
Speaker 6: least see if they want to get more information. They
37:53
Speaker 6: gave Fizer's bid early termination after fifteen days in the
37:58
Speaker 6: middle of this shutdown, saying, hey, no prob even though
38:02
Speaker 6: apparently Pfizer has some weight loss drugs in its own pipeline.
38:07
Speaker 1: Not clear exactly so, but they said, hey, no problem
38:10
Speaker 1: with that.
38:11
Speaker 6: And then they issued a letter to the lawyers for
38:16
Speaker 6: Lenovo Nordisk.
38:17
Speaker 1: And met Sarah.
38:19
Speaker 6: We've read about this deal which has not been filed
38:21
Speaker 6: with the federal takers. We read about it, and we're
38:24
Speaker 6: a little concerned that it may violate the Hartscott Rodino Act,
38:29
Speaker 6: which involves notification to the government that you're planning around
38:34
Speaker 6: with this, and so you better watch this.
38:38
Speaker 1: So what exactly is.
38:40
Speaker 6: Going on, I don't know, but they seem to be
38:43
Speaker 6: putting a little thumb on the scales in favor of Pfizer,
38:47
Speaker 6: whether intentionally or not. But they've really injected, sorry, they've
38:52
Speaker 6: injected themselves into this. It's an old fashioned antitrust tactical bruhaha.
39:00
Speaker 6: You know how it's going to end up, I'm not sure,
39:02
Speaker 6: but it's really something to be watching. This is one
39:05
Speaker 6: with real implications for competition.
39:08
Speaker 1: And for health.
39:09
Speaker 4: Who knew that weight laws drugs would also involve antitrust?
39:13
Speaker 4: Thanks so much, Harry. As always, that's Professor Harry First
39:17
Speaker 4: of NYU Law School. And that's it for this edition
39:20
Speaker 4: of The Bloomberg Law Show. Remember you can always get
39:22
Speaker 4: the latest legal news on our Bloomberg Law Podcast. You
39:25
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39:30
Speaker 4: dot Bloomberg dot com, slash podcast Slash Law, and remember
39:34
Speaker 4: to tune into the Bloomberg Law show every weeknight at
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Speaker 4: ten pm Wall Street Time. I'm June Grosso and you're
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Speaker 4: listening to Bloomberg