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Trump's Conviction, Google Breakup & 'Bitcoin Jesus' · Bloomberg Law

0:03
Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio.
0:09
Speaker 2: Manhattan District Attorney Alvin Bragg is opposing efforts to dismiss
0:14
Speaker 2: President elect Donald Trump's hush money conviction, but he has
0:18
Speaker 2: expressed openness to delaying sentencing until after Trump's second term.
0:23
Speaker 2: In a court filing today, the DA said Trump's forthcoming
0:26
Speaker 2: presidency isn't grounds for dropping a case that was already tried,
0:31
Speaker 2: but quote, given the need to balance competing constitutional interests,
0:36
Speaker 2: consideration must be given to potentially freezing the case until
0:40
Speaker 2: after he's out of office. Trump's lawyers are hoping to
0:43
Speaker 2: toss out the case completely, telling the judge in a
0:46
Speaker 2: letter that there are strong arguments for dismissal, including the
0:50
Speaker 2: Supreme Court's July decision on presidential immunity in criminal cases.
0:55
Speaker 2: But Bragg said Trump's argument that he can't be prosecuted
0:58
Speaker 2: as president elect has no bearing on the state's case
1:02
Speaker 2: after a Manhattan jury unanimously found him guilty at a
1:06
Speaker 2: time when he was not immune from criminal prosecution. The
1:10
Speaker 2: President elect was convicted in May of falsifying business records
1:14
Speaker 2: to cover up a scheme to influence the twenty sixteen election.
1:18
Speaker 2: Joining me is Bloomberg Legal reporter Eric Larson, who's been
1:21
Speaker 2: covering all these cases. Eric tell us about Alvin Bragg's
1:26
Speaker 2: letter to the judge.
1:28
Speaker 3: So the judge overseeing the hush money case had asked
1:31
Speaker 3: the prosecutor to let him know his recommendation for what
1:34
Speaker 3: should happen next in the case given Trump's election victory.
1:39
Speaker 3: So the letter had a bit of a concession in
1:41
Speaker 3: it by the district attorney, who said that given the
1:44
Speaker 3: election outcome and the powers and responsibilities of the US presidency,
1:49
Speaker 3: the DA would be open to discussing delaying the case
1:53
Speaker 3: during Trump's term in office. But the prosecutor also signaled
1:57
Speaker 3: further fighting here by saying that the DA would fight
2:00
Speaker 3: any attempt by Trump to outright dismiss the case. And
2:04
Speaker 3: Trump's side said in a letter earlier that they do
2:07
Speaker 3: intend to seek a dismissal of the case, even though,
2:09
Speaker 3: of course, the jury has already delivered its verdict and
2:12
Speaker 3: he's been found guilty on thirty four felony counts. Trump
2:15
Speaker 3: is going to argue that, in light of his election victory,
2:18
Speaker 3: the whole case and verdict should be passed out. So
2:21
Speaker 3: the prosecutor is signaling sure, you can make that act,
2:25
Speaker 3: but we're going to fight it, and in the meantime
2:27
Speaker 3: the case will be delayed. So there's still quite a
2:29
Speaker 3: bit of arguments going ahead here.
2:31
Speaker 2: Trump's lawyers wrote that the case had to be scrapped
2:34
Speaker 2: to facilitate the orderly transition of executive power and in
2:38
Speaker 2: the interests of justice. I mean, if he's not going
2:41
Speaker 2: to be sentenced, it doesn't interfere with the transition of power.
2:45
Speaker 2: And the jury rendered its verdict in the justice.
2:47
Speaker 3: System, well, it has been decided. But this, of course
2:50
Speaker 3: is so unprecedented. There's really never been a case like
2:53
Speaker 3: this before. I mean, it's strange enough or unusual enough
2:56
Speaker 3: to have a former president found guilty of crime. But
2:59
Speaker 3: the fact that he was convicted before the election, but
3:03
Speaker 3: then was not sentenced before the election, it leaves open
3:06
Speaker 3: this question. So the government clearly is saying, it said
3:10
Speaker 3: in this letter that look, the jury has spoken, and
3:12
Speaker 3: we have to respect the findings of this jury. But
3:15
Speaker 3: let's talk about how this proceeds. So we can expect
3:18
Speaker 3: to see some very novel arguments laid out in Trump's
3:21
Speaker 3: filing whenever that does come. Beking dismissal of this verdict
3:25
Speaker 3: but of course they're going to point to the powers
3:27
Speaker 3: of the presidency and point to clashes between states and
3:31
Speaker 3: the federal government and who should prevail. So again, nothing
3:34
Speaker 3: has ever happened like this before, So we'll have to
3:36
Speaker 3: wait and see what Trump's filing says. But the prosecutor
3:38
Speaker 3: is definitely signaling a fight here.
3:40
Speaker 2: Yeah, I mean, it would be so unusual to just
3:43
Speaker 2: set aside a jury verdict because the defendant has become president.
3:49
Speaker 4: What would be the legal basis for that, right?
3:52
Speaker 3: I think some of the legal experts have actually said
3:54
Speaker 3: that a judge really can't do that in the New
3:56
Speaker 3: York law, that except under certain circumstances, and it's unclear
3:59
Speaker 3: if this be one of those. But you know, other
4:02
Speaker 3: experts have said that if things don't go the way
4:04
Speaker 3: Trump wants in this court, they could also try again
4:07
Speaker 3: to have the whole case transferred to federal court, where
4:10
Speaker 3: it could be more quickly dismissed, potentially under these federal arguments.
4:14
Speaker 3: And Trump of course did try that in this case
4:16
Speaker 3: a couple of times earlier in sales, but that was
4:18
Speaker 3: before the election, so he's got new potential arguments here.
4:22
Speaker 3: This has not happened yet, but it is something experts
4:24
Speaker 3: is that he could try to do in terms of
4:26
Speaker 3: moving into federal court.
4:27
Speaker 2: Is the sentencing date still scheduled?
4:30
Speaker 3: Right, So the court is saying that as of now,
4:32
Speaker 3: technically the November twenty sixth sentencing date, it's still on
4:36
Speaker 3: the calendar, but it seems fairly clear that that's not
4:40
Speaker 3: going to actually happen. The letter itself, but by the
4:44
Speaker 3: district's attorney, proposes that Trump be given a deadline to
4:48
Speaker 3: file his motion to dismiss and that the DA be
4:51
Speaker 3: given a chance to respond. Of course, and the response
4:54
Speaker 3: to date proposed that a DA was December ninth, So
4:58
Speaker 3: the judge is probably going to look pretty strongly at
5:01
Speaker 3: what the DA is proposing. This is the government's case here,
5:04
Speaker 3: and so it doesn't seem like there's any chance of
5:07
Speaker 3: that actually happening on November twenty sixth.
5:10
Speaker 2: And we should note, I mean it's been delayed the
5:13
Speaker 2: sentencing at Trump's request, right.
5:16
Speaker 3: Right, So we're at this moment where the judge is
5:19
Speaker 3: going to have to decide whether or not he can
5:21
Speaker 3: sentence a president elect, which would be unprecedented and you know,
5:25
Speaker 3: maybe not a great look for the United States government
5:28
Speaker 3: going into a new administration. But the reason that we
5:31
Speaker 3: are here at this moment is because Trump was able
5:34
Speaker 3: to delay the sentencing a couple of times before the election,
5:38
Speaker 3: and a lot of the legal experts have predicted that
5:41
Speaker 3: when the sensing, if it goes forward, that he would
5:43
Speaker 3: get a lot less than the maximum four years under
5:45
Speaker 3: the law, just for various reasons like he's a first
5:48
Speaker 3: time offender and the crimes are non violence and that
5:50
Speaker 3: sort of thing. So in theory, Trump could have been
5:53
Speaker 3: sentenced months ago and even served his sentence or even
5:57
Speaker 3: got no time dis probations, and it all could been
6:00
Speaker 3: done before the election, but the judge was worried that
6:02
Speaker 3: any kind of sentence could impact the outcome of the election.
6:06
Speaker 3: That was his reason for delaying it the last time.
6:08
Speaker 2: And Trump has really succeeded with his strategy of delay
6:14
Speaker 2: in all his cases. What's happening with the Justice Department's
6:19
Speaker 2: cases against him? Have those been dropped yet?
6:22
Speaker 3: Right? So? Special Counsel Jack Smith, who brought the two
6:26
Speaker 3: federal cases against Trump, it seems like the writing is
6:29
Speaker 3: on the wall that those cases are going to have
6:31
Speaker 3: to go away. The US Justice Department officials said that
6:33
Speaker 3: they had asked and received a court order delaying all
6:36
Speaker 3: deadlines in the election interference case while they consider exactly
6:42
Speaker 3: what to do next. And of course there is a
6:44
Speaker 3: longstanding DOJ policy against prosecuting or indicting sitting presidents, so
6:50
Speaker 3: the expectation is that those cases are going to go away.
6:54
Speaker 3: The classified documents case in federal court in Florida, of course,
6:58
Speaker 3: was dismissed by a Trump appointed judge earlier this year,
7:01
Speaker 3: but the Justice Department has appealed that, and so it's
7:04
Speaker 3: likely that that appeal would be dropped and that other
7:07
Speaker 3: case dismissed as well. So yet, to the extent that
7:11
Speaker 3: Trump thinks on this election victory making his extensive legal
7:14
Speaker 3: troubles go away, that largely is a success.
7:18
Speaker 2: The Georgia election interference case is also on hold. It's
7:22
Speaker 2: kind of amazing that he and his lawyers were able
7:26
Speaker 2: to just freeze two federal cases and two state cases.
7:32
Speaker 4: It's sort of mind boggling.
7:34
Speaker 3: I mean, he has a lot of lawyers, they have
7:37
Speaker 3: some creative strategies. And of course, all along here Trump
7:41
Speaker 3: was campaigning for the presidency, which gave him additional ways
7:45
Speaker 3: to delay the cases from the proceedings. And in Georgia,
7:50
Speaker 3: of course, they were able to. It wasn't even really
7:53
Speaker 3: Trump's false. So to say that that case got delayed
7:57
Speaker 3: so much, I mean the district attorney there, Fannie Willison
8:00
Speaker 3: Fulton County. The reason that case is the latest because
8:02
Speaker 3: she had an affair with another person on one of
8:06
Speaker 3: our investigators on the case, and Trump had moved to
8:10
Speaker 3: have her disqualified, and an appeals court is eventually going
8:13
Speaker 3: to have to decide that before that case can move
8:15
Speaker 3: forward anymore.
8:16
Speaker 2: And so what the district attorney is suggesting here is
8:20
Speaker 2: basically put it on hold and will sentence him after
8:24
Speaker 2: his presidency is over.
8:26
Speaker 3: Is that the implication, Well DA in Manhattan didn't explicitly
8:29
Speaker 3: stable sentence him after the presidency is over, but more
8:33
Speaker 3: just to put the entire case on hold yet. The
8:36
Speaker 3: sentence thing is the next thing to come up here,
8:38
Speaker 3: But there could be additional arguments that could be made
8:40
Speaker 3: once the case restarts theoretically after his term in office,
8:44
Speaker 3: around immunity or things like that. So not specifically saying
8:49
Speaker 3: schedule a sentencing after his term in office is over,
8:52
Speaker 3: but just putting the whole case on hold and revisit
8:55
Speaker 3: it later.
8:56
Speaker 2: The lawyer who represented him in the hush money case.
8:58
Speaker 2: Is he one of the lawyers that Trump is appointing
9:01
Speaker 2: to the Justice Department?
9:03
Speaker 3: Right? I think Todd Blanche has been nominated for Deputy
9:07
Speaker 3: Attorney general position, if I'm remembered correctly.
9:09
Speaker 2: Yeah, that's right, and Blanche was a former federal prosecutor.
9:14
Speaker 2: He's also nominating his other defense lawyer in this case,
9:18
Speaker 2: Emil Bove as principal Associate Attorney General, and the lawyer
9:23
Speaker 2: who represented him in the presidential immunity case at the
9:26
Speaker 2: Supreme Court has been chosen as the Uslicitor General. So
9:31
Speaker 2: Trump's lawyers are getting plump positions in the Justice Department.
9:35
Speaker 2: Thanks so much, Eric, that's Bloomberg Legal reporter Eric Larson.
9:39
Speaker 2: It would be a historic crackdown on one of the
9:42
Speaker 2: world's biggest tech companies. That is, if a judge agrees
9:46
Speaker 2: to the Justice Department's proposal to sell Google's Chrome browser
9:51
Speaker 2: as a remedy for his decision that the tech giant
9:54
Speaker 2: illegally monopolized the search market, Federal anti trust enforcers will
9:58
Speaker 2: ask Judge Ahmitt Meta to order Google to sell off
10:02
Speaker 2: Chrome because, as the world's most popular web browser, it
10:06
Speaker 2: represents a key access point through which many people use
10:10
Speaker 2: its search engine. That's according to Bloomberg sources, it would
10:14
Speaker 2: mark the biggest forced breakup of a US company since
10:18
Speaker 2: AT and T was dismantled in nineteen eighty four. Joining
10:22
Speaker 2: me is Bloomberg Anti trust reporter Leean Nylan Lea tell
10:26
Speaker 2: us what you learned. The Justice Department is going to
10:28
Speaker 2: be asking for as a remedy, although Google might view
10:31
Speaker 2: it as a punishment for Google's violation of the antitrust laws.
10:35
Speaker 5: So the big headline is, the Justice Department is going
10:39
Speaker 5: to propose that Google be forced to sell off Chrome,
10:42
Speaker 5: It's web browser, if some of the other things that
10:45
Speaker 5: it is proposing to sort of increase competition in the
10:48
Speaker 5: market aren't successful. So the other big things that it
10:50
Speaker 5: really wants to do is force Google to license the
10:54
Speaker 5: data this is called click and query data that underlies
10:57
Speaker 5: its search results, as well as syndicate the search results
11:01
Speaker 5: themselves to other companies and AI startups. The syndication is
11:05
Speaker 5: supposed to sort of help other companies other search engines
11:09
Speaker 5: sort of get better a lot more quickly because they'll
11:11
Speaker 5: be able to rely on the same results that Google
11:14
Speaker 5: does in its search engine. And then this underlying data,
11:17
Speaker 5: the click and query data, can sort of help them
11:20
Speaker 5: beef up their own systems to sort of make them
11:23
Speaker 5: as good as the one that Google has itself, because
11:27
Speaker 5: one of the main allegations in the complaint and that
11:30
Speaker 5: the judge found was true in his opinion, is that
11:32
Speaker 5: Google's conduct has led to such a situation that the
11:35
Speaker 5: other search engines don't have the same level of quality
11:38
Speaker 5: because Google just has so much more traffic than them.
11:41
Speaker 5: So this is a way to sort of get them
11:43
Speaker 5: a lot of the same high quality results so that
11:45
Speaker 5: they can improve their own systems to be as good
11:48
Speaker 5: as Google. The other really big interesting thing is they
11:51
Speaker 5: want to make some proposals that would limit a couple
11:54
Speaker 5: of the things that Google is doing on artificial intelligence.
11:57
Speaker 5: So right now, companies can opt out of having their
12:01
Speaker 5: website scraped and that data used in building Googles llm's
12:06
Speaker 5: large language models which underlie its AI products, but they're
12:10
Speaker 5: not allowed to, for example, opt out of the so
12:13
Speaker 5: called aioverviews that appear at the top of a search
12:16
Speaker 5: results page. So sometimes when you Google something, instead of
12:19
Speaker 5: showing you the ten blue links, it just gives you
12:21
Speaker 5: sort of like a summary at the top, and it's
12:24
Speaker 5: been taking that summary using AI and sort of just
12:27
Speaker 5: putting it there at the top, and oftentimes website publishers
12:30
Speaker 5: have complained people don't click through. They just see that
12:33
Speaker 5: AI summary and then you know, they have their answer
12:36
Speaker 5: and they're done. And website publishers say that this is
12:39
Speaker 5: problematic for them because they've been losing a lot of
12:40
Speaker 5: traffic and therefore, you know, the advertising dollars that are
12:43
Speaker 5: associated with that. So they really don't like the AI
12:45
Speaker 5: overhus But Google right now doesn't give anybody a way
12:49
Speaker 5: to opt out of that. So the Justice Apparent wants
12:51
Speaker 5: to make it so that website publishers have a lot
12:53
Speaker 5: more options for how their data is used by Google,
12:57
Speaker 5: in particular in its AI products.
13:00
Speaker 2: So the Justice Department is saying, we want to have
13:03
Speaker 2: the option of having Google cell Chrome if we decide
13:08
Speaker 2: that these other things aren't working. I mean, is the
13:11
Speaker 2: government saying that decision should be up to us.
13:15
Speaker 5: We're not sure. The filing is supposed to come tomorrow,
13:18
Speaker 5: so we will find out exactly how they are proposing
13:20
Speaker 5: that would work. But yes, you seem to sort of
13:23
Speaker 5: be trying to keep this option of like having the
13:25
Speaker 5: big sword over Google's head to make sure that it
13:28
Speaker 5: complies with some of the other things that it wants
13:30
Speaker 5: in this injunction. This is all very dependent on the judge, though,
13:34
Speaker 5: you know, the judge I'm at Meta is going to
13:36
Speaker 5: have a remedy hearing in April to sort of hear
13:39
Speaker 5: from witnesses a little bit about these options, and then
13:42
Speaker 5: he will issue a decision sometimes next year. He said
13:45
Speaker 5: he will have it out by August twenty twenty five
13:48
Speaker 5: with his final decision on how Google should change its behavior.
13:51
Speaker 5: A lot of people think that the judge is really
13:53
Speaker 5: not going to go for the breakup or the vestuture
13:56
Speaker 5: option that the Justice Department has you know, hinted and
14:00
Speaker 5: that we reported that they're going to propose, just because
14:03
Speaker 5: it is a little bit more of a sort of
14:05
Speaker 5: radical option. You know, the government hasn't actually broken up
14:08
Speaker 5: a company since the AT and T case in nineteen
14:10
Speaker 5: eighty four, and so you know, even though it had
14:13
Speaker 5: wanted to break up Microsoft, it ended up, you know,
14:15
Speaker 5: accepting some lesser changes instead of a breakup. So a
14:18
Speaker 5: lot of people really think that Meta is not going
14:21
Speaker 5: to go for this, so that this may be a
14:22
Speaker 5: little bit of like a position that the Justice Department
14:25
Speaker 5: is taking to sort of fear meta a little bit
14:28
Speaker 5: more towards the middle ground, which is the you know,
14:31
Speaker 5: data licensing portion.
14:32
Speaker 2: What's left of Google if you force it to sell
14:35
Speaker 2: off at search engine.
14:37
Speaker 5: Well, they're not proposing that it be forced to sell
14:39
Speaker 5: off the search engine, only Chrome the web browser. Oh,
14:42
Speaker 5: it would still have the search engine, it would still
14:44
Speaker 5: have Android, the mobile operating system. It just would no
14:48
Speaker 5: longer have a browser. And the browser has been a
14:50
Speaker 5: very important sort of They call it a search access point,
14:54
Speaker 5: a way in which people access Google Search because it
14:56
Speaker 5: is you know, tied into the browser. It automatically goes
14:59
Speaker 5: to Google if you type something in and that it
15:02
Speaker 5: has also been a pretty important feature for Google in
15:05
Speaker 5: terms of if you're using Chrome and you are signed
15:07
Speaker 5: into a Google account, it keeps a lot of information
15:11
Speaker 5: about where you have visited and you know what other
15:14
Speaker 5: Google services you use, you know, your YouTube history, all
15:17
Speaker 5: of that information, and that is some of the details
15:20
Speaker 5: in data that Google used to help target ads towards you.
15:24
Speaker 5: So if Google no longer has this browser, this sort
15:27
Speaker 5: of gateway that people use and helps them collect you know,
15:30
Speaker 5: data and information about people, it would be an important
15:34
Speaker 5: blow to the company because you know, they do rely
15:37
Speaker 5: on Chrome quite a bit for some of their other services.
15:41
Speaker 2: Actually, I think I might be confusing the browser and
15:45
Speaker 2: the search engine.
15:46
Speaker 5: As you know, we actually went over this. This is
15:48
Speaker 5: an early question of the trial. What is the difference
15:50
Speaker 5: between a browser and the search engine. So the browser
15:52
Speaker 5: is the thing that you use to access the internet,
15:55
Speaker 5: you know, it is the program where it has up
15:58
Speaker 5: at the top and you can type in, you know,
16:00
Speaker 5: HTTP whatever.
16:01
Speaker 4: You know.
16:01
Speaker 5: The first one was Internet Explorer, but Chrome, which was
16:05
Speaker 5: introduced by Google in two thousand and eight, was very
16:07
Speaker 5: innovative at the time because when it could remember a
16:11
Speaker 5: lot of the website, so you oftentimes you don't have
16:14
Speaker 5: to like type out the entire website like you did
16:16
Speaker 5: in the past, you know, www dot New York Times
16:19
Speaker 5: dot com. If you just start typing it, it says, oh,
16:21
Speaker 5: you want to go to New York Times and then
16:23
Speaker 5: be there. The other thing is you can actually just
16:25
Speaker 5: type a query in the web browser bar and it
16:29
Speaker 5: will automatically take you to Google as though you were
16:32
Speaker 5: using that as a search engine. And that was like
16:35
Speaker 5: a pretty you know, unique invention at the time, back
16:38
Speaker 5: in two thousand and eight. And that's a reason why
16:40
Speaker 5: a lot of people do use Chrome, you know, because
16:42
Speaker 5: it is integrated with Google. It's integrated with a lot
16:45
Speaker 5: of Google cell their products so that it remembers. For example,
16:48
Speaker 5: you know, if you have searched for a recent location
16:50
Speaker 5: on Google Maps, it remembers that, and it can be like, oh,
16:52
Speaker 5: are you trying to go to this Italian restaurant you
16:54
Speaker 5: went to last week or two weeks ago. So Chrome
16:57
Speaker 5: has integrated a lot of Google services, is pretty useful. Now.
17:01
Speaker 5: Google likes to say, you know, Chrome is our product.
17:05
Speaker 5: The software underlying Chrome is actually an open source product.
17:09
Speaker 5: Anyone can use it, and a lot of the other browsers,
17:11
Speaker 5: including Impact of Microsoft's Edge, are built on that open
17:15
Speaker 5: source that Google made from Chrome. So Edge is based
17:19
Speaker 5: on this open source Chromium. The one that Amazon has
17:22
Speaker 5: built for the Fire device is called Silk, is also
17:24
Speaker 5: built on that. So you know, they say Chrome doesn't
17:27
Speaker 5: have very much value without you know, a lot of
17:31
Speaker 5: the other Google data underlying it. We'll see, we'll see.
17:34
Speaker 5: You know, there are some people who might be very
17:37
Speaker 5: willing to pay for Chrome. Our analyst here at BI
17:42
Speaker 5: suggested that it might be worth as much as twenty
17:44
Speaker 5: million dollars because of the number of people who use
17:46
Speaker 5: that browser every day something like three billion daily active users.
17:51
Speaker 5: And so you know, if another company could take it
17:54
Speaker 5: and integrate it with their own services, it could be
17:57
Speaker 5: pretty powerful. For example, if open ai wanted to have
18:00
Speaker 5: a browser and sort of integrate it with its new
18:02
Speaker 5: sort of burgeoning AI and search though its that might
18:05
Speaker 5: be in a really interesting combination.
18:07
Speaker 2: But as you point out in your story, some of
18:10
Speaker 2: the companies that might want to buy it, like Amazon,
18:12
Speaker 2: are facing their own antitrust scrutiny. I mean, will it
18:15
Speaker 2: go from one monopolist to another, or should I say
18:19
Speaker 2: one mega company to another.
18:21
Speaker 5: Yeah, that's definitely true. I mean the very first company
18:24
Speaker 5: that somebody mentioned might want to buy it with Microsoft,
18:27
Speaker 5: and I was like, well, there's no way they're going
18:28
Speaker 5: to let Microsoft buy this browser. Like one, Microsoft has
18:31
Speaker 5: the second most use browser, and you got Microsoft in trouble,
18:35
Speaker 5: like back in the day, right was the Internet Explorer browser.
18:39
Speaker 5: So I really don't think we're going to go back
18:41
Speaker 5: down the road of like giving Microsoft control of the browser.
18:45
Speaker 4: What do you think.
18:45
Speaker 2: Google will be willing to or will be suggesting as
18:49
Speaker 2: a remedy?
18:49
Speaker 4: Do you have any idea just will be judge meta?
18:53
Speaker 5: Yeah, Google has said, you know, if the judge has
18:56
Speaker 5: a problem with these contracts, what they could do is
18:59
Speaker 5: just it's the contracts, but eliminate their exclusive nature. So
19:03
Speaker 5: he said it was a problem that Google was paying
19:07
Speaker 5: you know, Apple, for example, twenty billion dollars a year
19:09
Speaker 5: to be the exclusive search default. Okay, maybe they're no
19:13
Speaker 5: longer going to be paid to be the exclusive Maybe
19:15
Speaker 5: they'll now just pay for whatever searches are sent by
19:18
Speaker 5: Apple to Google, and then everybody else can pay because
19:22
Speaker 5: other companies do pay to sort of appear on you know,
19:26
Speaker 5: when you open up a browser window in Safari, you
19:30
Speaker 5: sometimes see you know, you can go to Microsoft thing,
19:33
Speaker 5: you can go to Yahoo, you can go to Wikipedia.
19:35
Speaker 5: All those things those companies actually pay for that placement.
19:38
Speaker 5: So maybe everybody just pays for whatever traffic is being
19:42
Speaker 5: sent to them through the browser or you know, Apple users,
19:46
Speaker 5: instead of having it be an exclusive devolve. The government,
19:49
Speaker 5: of course, isn't thrilled with just that change, because you know,
19:53
Speaker 5: their argument is Google has benefited from having these contracts
19:57
Speaker 5: for so long. You can't just now say, you know,
19:59
Speaker 5: go orhm to no more. You have to sort of
20:02
Speaker 5: fix the market that has been sort of distorted by
20:06
Speaker 5: Google's conduct having these illegal contracts for so long. So
20:10
Speaker 5: Google is really going to be pushing to sort of
20:12
Speaker 5: limit this as much as possible, maybe make it just
20:14
Speaker 5: about the contracts, whereas the government is going to say, yeah,
20:18
Speaker 5: we need to change the contracts, but we need all
20:20
Speaker 5: these other things as well.
20:22
Speaker 2: And most people you spoke to thought that Judge Meta
20:25
Speaker 2: wouldn't go as far as you said at and T
20:28
Speaker 2: was the last time there was a government ordered breakup
20:31
Speaker 2: of a company, that Judge Meta wouldn't go so far
20:34
Speaker 2: as to order that.
20:35
Speaker 5: Yeah, a lot of people have said, you know, even
20:38
Speaker 5: since his decision in August, that they really think that
20:41
Speaker 5: he's not going to go for a breakup. I mean,
20:44
Speaker 5: he has relied very heavily in his opinion and in
20:47
Speaker 5: his thinking about this on the Microsoft case. And in
20:49
Speaker 5: the Microsoft case, you know, the judge originally ordered a
20:52
Speaker 5: breakup and then the DC Circuit sort of knocked that down.
20:56
Speaker 5: So really taking that into account, they think that judgement
21:00
Speaker 5: is probably going to be pretty reluctant to go down
21:02
Speaker 5: the same path that the original Microsoft just judge did
21:05
Speaker 5: because he really is invested in making sure that his
21:08
Speaker 5: decision stands up on appeal. And is compliant with the law,
21:12
Speaker 5: and given sort of the tenor of the courts recently,
21:16
Speaker 5: they don't think that the breakup option is really what
21:19
Speaker 5: he's going to go for. The other interesting thing I
21:21
Speaker 5: heard is if the government isn't successful in pushing him
21:26
Speaker 5: to require a divestiture here, they still have their other case.
21:30
Speaker 5: You know, we have closing arguments in that one next week.
21:33
Speaker 5: This is the case about involving advertising technology, and Chrome
21:37
Speaker 5: is actually pretty important in that one too, because as
21:39
Speaker 5: I mentioned, you know, all of the data that Google
21:42
Speaker 5: gets from people using the Chrome browser is a thing
21:45
Speaker 5: that uses to help target advertising. So if Meta is
21:49
Speaker 5: reluctant to order a sale of Chrome, they might have
21:52
Speaker 5: a second chance to argue for that before the other judge,
21:56
Speaker 5: Judge Brinkamatt in Virginia.
21:58
Speaker 2: Google says it's going to Judge Meta's decision, and you know,
22:02
Speaker 2: I assume that if it goes to the DC Circuit,
22:05
Speaker 2: then it'll go to the Supreme Court no matter what,
22:09
Speaker 2: which may or may not take the case. So I
22:11
Speaker 2: mean we're talking about years ahead.
22:14
Speaker 5: Yeah, I mean, so Judge Metta has said he intends
22:17
Speaker 5: to have his final order issue by August of twenty
22:20
Speaker 5: twenty five, and then it's going to go to the
22:22
Speaker 5: DC Circuit. That process is probably going to take nine
22:25
Speaker 5: months to a year. The Justice Department has been trying
22:28
Speaker 5: to push this argument that, like, these things need to
22:31
Speaker 5: be expedited. This has been going on for a long time.
22:33
Speaker 5: It needs to be resolved because we need to sort
22:36
Speaker 5: of yet underway at starting to bring competition back to
22:40
Speaker 5: these markets. So they may try and push the DC
22:42
Speaker 5: Circuit to do it on a more of an expedited
22:45
Speaker 5: basis than they would otherwise. But it's true like by
22:48
Speaker 5: the time we get through these appeals, it's probably going
22:50
Speaker 5: to be a year to eighteen months. So at the earliest,
22:53
Speaker 5: you know, any of these changes that they are proposing
22:55
Speaker 5: are probably not going to be in place until twenty
22:58
Speaker 5: twenty six, maybe early twenty twenty seven.
23:00
Speaker 2: Yeah, good luck with trying to convince the DC Circuit
23:02
Speaker 2: that this all of a sudden it requires lightning speed,
23:07
Speaker 2: and Judgemadow will hold that hearing in April of twenty
23:11
Speaker 2: twenty five, So quite a long time to go even
23:14
Speaker 2: to the hearing, let alone the appeals. Thanks so much, Leah.
23:17
Speaker 2: That's Bloomberg Anti Trust reporter Lean Nylan coming up. Just
23:22
Speaker 2: Who is Bitcoin Jesus and why is he fighting extradition?
23:25
Speaker 2: This is Bloomberg To his followers, Roger vere is known
23:30
Speaker 2: as Bitcoin Jesus, a charismatic advocate of the cryptocurrency that's
23:35
Speaker 2: once again captivating investors worth record breaking gains.
23:39
Speaker 4: But to the.
23:40
Speaker 2: Irs, Verr is a new target for the digital age,
23:43
Speaker 2: a crypto holder suspected of failing to pay taxes after
23:47
Speaker 2: selling tokens, and prosecutors have charged Verer with evading more
23:52
Speaker 2: than forty eight million dollars in taxes for selling two
23:56
Speaker 2: hundred and forty million dollars in tokens. The case marks
23:59
Speaker 2: a break from more traditional cases where prosecutors tax tax
24:03
Speaker 2: charges onto crypto cases for crimes like money laundering, ransomware attacks,
24:09
Speaker 2: and investor scams. The case against Veer deals solely with
24:13
Speaker 2: tax fraud and digital asset sales. Joining me is Bloomberg
24:17
Speaker 2: legal reporter David Voriakis, who's.
24:19
Speaker 4: Written about him? So, David, who is Bitcoin Jesus and
24:24
Speaker 4: how did he get that name?
24:26
Speaker 1: Roger Meer was an early investor in bitcoin. He grew
24:31
Speaker 1: up in Silicon Valley and he was a libertarian. When
24:37
Speaker 1: he was twenty two, he was convicted of selling explosives
24:42
Speaker 1: without a license, and he did ten months in prison.
24:47
Speaker 1: That reinforced his negative attitude towards the US government, and
24:53
Speaker 1: he moved to Japan. Then he later renounced his US
24:58
Speaker 1: citizenship and he became a citizen of Saint Kitts and Nevis.
25:03
Speaker 1: Along the way, he became a very powerful advocate for bitcoin,
25:11
Speaker 1: selling it everywhere that he could, selling the notion of
25:14
Speaker 1: it promise and the potential of cryptocurrencies to transfer wealth
25:20
Speaker 1: without mediation by regulators or governments or other institutions. And
25:27
Speaker 1: he's a charismatic speaker who got the nickname Bitcoin Jesus.
25:32
Speaker 1: He invested in several crypto companies in their startup days
25:38
Speaker 1: and made a lot of money. Roger Vere has gotten
25:43
Speaker 1: into trouble with the Internal Revenue Service.
25:46
Speaker 2: I mean, how did he get so popular and so
25:48
Speaker 2: well known.
25:50
Speaker 1: Well, he tweeted a lot. He's got seven hundred thousand
25:53
Speaker 1: followers on it, and he appeared at conferences. He was
25:59
Speaker 1: just no within the cryptoworld. He'd appear at meetups and
26:04
Speaker 1: other gatherings, and he was a very influential player in
26:09
Speaker 1: the early ecosystem of bitcoin. You know, he's well spoken,
26:14
Speaker 1: good looking, charismatic. He has a real presence about him,
26:18
Speaker 1: and so his message resonated with people, and people reacted
26:22
Speaker 1: to his message that you should all go out and
26:25
Speaker 1: buy bitcoin and then other cryptocurrencies that he was also supporting.
26:30
Speaker 2: He was a co founder of blockchain dot com. Is
26:33
Speaker 2: he still an owner there?
26:35
Speaker 1: He is not, But there were other companies that he
26:39
Speaker 1: was an early investor in, like payment processor BitPay and
26:44
Speaker 1: the digital asset firm Ripple. There was a software upgrade
26:48
Speaker 1: that the Bitcoin network underwent that he opposed in twenty seventeen,
26:54
Speaker 1: and he switched to a split off coin called bitcoin Cash,
26:59
Speaker 1: and that was very controversial at the time. That that
27:02
Speaker 1: was the stand that he took, and so he's continued
27:05
Speaker 1: to be popular in crypto circles.
27:09
Speaker 2: He renounced his US citizenship in twenty fourteen. What steps
27:14
Speaker 2: are required legally when you do that?
27:17
Speaker 1: If they are worth more than two million dollars, they're
27:20
Speaker 1: supposed to report their worldwide assets to the IRS and
27:24
Speaker 1: pay an exit tax based on their assets sales. So
27:29
Speaker 1: they have to make a written through report to the
27:34
Speaker 1: IRS about what they own anywhere in the world, and
27:37
Speaker 1: then they have to file a return that reflects how
27:42
Speaker 1: much tax they owe on whatever income or sales they've had.
27:47
Speaker 2: So did he report to the IRS when he renounced
27:50
Speaker 2: his citizenship?
27:51
Speaker 4: Tell us what happened?
27:52
Speaker 1: Well, according to the indictment in federal court in Los Angeles,
27:57
Speaker 1: he did not make an accurate report to the IRS
28:01
Speaker 1: about what assets he owned, specifically the crypto holdings that
28:08
Speaker 1: he had personally and through two companies that he founded
28:13
Speaker 1: and that were based in California. They were called Memory
28:16
Speaker 1: Dealers and Agile Star, and the IRS, in its indictment,
28:21
Speaker 1: which accuses him of tax of asion, wire fraud, and
28:25
Speaker 1: filing a false tax return, says that he did not
28:29
Speaker 1: fully report his crypto holdings for one and then later
28:35
Speaker 1: on in twenty seventeen, they alleged that he sold about
28:41
Speaker 1: two hundred and forty million dollars in crypto and that
28:46
Speaker 1: he failed to pay forty eight million dollars in taxes
28:50
Speaker 1: on those sales.
28:51
Speaker 2: And is this case unusual in any respect?
28:54
Speaker 4: Is it different?
28:54
Speaker 1: It is unusual because for several years the Internal Revenue
28:58
Speaker 1: Service has been talking about filing a tax of asion
29:02
Speaker 1: case based solely on crypto, and this has been a
29:07
Speaker 1: subject of considerable debate within the IRS for a long time.
29:12
Speaker 1: On how to notify crypto holders that they have an
29:16
Speaker 1: obligation to pay taxes when they sell crypto and what
29:20
Speaker 1: the proper rate should be. What crypto holders are supposed
29:24
Speaker 1: to disclose. It's now part of an IRS tax return.
29:28
Speaker 1: Do you have digital currency holdings or not? Yes or no?
29:32
Speaker 1: And then they're supposed to pay capital gains tax on
29:35
Speaker 1: their sale. There was another person from Texas who was
29:39
Speaker 1: charged earlier this year in the first crypto only tax
29:44
Speaker 1: of asion case, and then Roger vere was the second
29:47
Speaker 1: who was charged. The other one seated guilty in September,
29:52
Speaker 1: and Verer is now facing extradition from Spain where he
29:58
Speaker 1: was arrested in April.
30:00
Speaker 2: And what's his defense to the charges.
30:02
Speaker 1: Well, his defense is that he was relying on the
30:06
Speaker 1: advice of his lawyers and his other tax professionals, and
30:10
Speaker 1: that at the time in question, which would be twenty
30:13
Speaker 1: fourteen to twenty seventeen, the IRS policy was very much
30:18
Speaker 1: unsettled on what crypto holders owed and how they were
30:23
Speaker 1: supposed to proceed. He says that he has exculpatory emails
30:28
Speaker 1: and other evidence that show that he had no intention
30:33
Speaker 1: to evade taxes under the law, you have to know
30:37
Speaker 1: that you have an obligation and willingly violate that obligation
30:42
Speaker 1: to be guilty of tax evasions. He says that he
30:45
Speaker 1: had no intent to do that, and that he has
30:47
Speaker 1: evidence that the Justice Department is ignoring tell us.
30:51
Speaker 2: About Spain and extradition. Is he still in jail in Spain.
30:55
Speaker 1: He was arrested while attending a crypto conference in Barcelona
30:59
Speaker 1: in April. He's spent a month in jail there and
31:04
Speaker 1: since then he's lived on the island of Majorca, where
31:07
Speaker 1: he's had a steady stream of visitors, and he remains
31:11
Speaker 1: an outspoken critic of the US government.
31:14
Speaker 4: So he's fighting extradition.
31:16
Speaker 1: I take it there was an extradition hearing. The judge
31:19
Speaker 1: has not issued a decision yet. He's fighting extradition. The
31:23
Speaker 1: US government has successfully extradited other white collar criminals from Spain,
31:29
Speaker 1: and so there is a history of Spain cooperating with
31:33
Speaker 1: US requests for extradition. That may not vode well for
31:37
Speaker 1: his case, but the judge is still considering how to
31:40
Speaker 1: act here. One of the cases involved Douglas Edelman, who
31:44
Speaker 1: was a former defense contractor who's charged with evading taxes
31:48
Speaker 1: on more than three hundred and fifty million dollars in income.
31:52
Speaker 1: He was extradited earlier this year and now faces trial
31:55
Speaker 1: in the US.
31:56
Speaker 2: There's no timetable for the Spanish judge to make that decision,
32:00
Speaker 2: but I know you will let us know as soon
32:02
Speaker 2: as he does. Thanks so much, David. That's Bloomberg Legal
32:05
Speaker 2: reporter David Voriakis, and that's it for this edition of
32:08
Speaker 2: The Bloomberg Law Show. Remember you can always get the
32:11
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32:14
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