Latest / Bloomberg Law / Juror Kicked Off Diddy Trial & Harvard v. Trump

Transcript

Juror Kicked Off Diddy Trial & Harvard v. Trump · Bloomberg Law

0:02
Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.
0:08
Speaker 2: Juror drama at the Sean Diddy Combes trial even before
0:12
Speaker 2: deliberations begin, the judge dismissed jural number six yesterday, despite
0:18
Speaker 2: the defense's concerns that putting in a white alternate for
0:21
Speaker 2: the black juror would make the jury less diverse and
0:25
Speaker 2: another juror maybe in jeopardy for speaking about the case.
0:29
Speaker 2: Joining me is former federal prosecutor Robert Mintz, a partner
0:32
Speaker 2: maccarter in English, Bob tell us what happened with jural
0:36
Speaker 2: number six.
0:37
Speaker 3: Even before we got to the close of the trial
0:41
Speaker 3: and deliberations in front of the jury. One of the jurors,
0:44
Speaker 3: Jurer number six, was removed from the panel by the
0:48
Speaker 3: judge after it was determined that the juror had been
0:52
Speaker 3: less than candid about where he resided during the jury
0:55
Speaker 3: selection process. He apparently indicated that he lived in the Bronx,
1:00
Speaker 3: which is part of the Southern District of New York,
1:02
Speaker 3: but later information surfaced that he actually lived with his
1:06
Speaker 3: girlfriend in New Jersey, which is not within the Southern
1:10
Speaker 3: District of New York and not even within the district
1:12
Speaker 3: where the trial is taking place, and the court will
1:16
Speaker 3: say that you cannot be sitting on the jury unless
1:19
Speaker 3: you reside within the district. So that was ground to
1:22
Speaker 3: remove the juror, and the judge found that there was
1:25
Speaker 3: nothing that could be done to repair the juror's credibility since,
1:30
Speaker 3: according to the judge, he had apparently been less than
1:33
Speaker 3: candid about where he was living.
1:35
Speaker 2: The trial is in its sixth week. Do the attorneys
1:38
Speaker 2: have a feel for which jurors may be leaning in
1:42
Speaker 2: their direction.
1:44
Speaker 3: Throughout the trial? It's typical for the defense and the
1:47
Speaker 3: prosecution to be forming opinions about which jurors they think
1:51
Speaker 3: may be favoring their case. Of course, nobody really knows
1:54
Speaker 3: what's going on, because the jurors aren't saying anything but
1:58
Speaker 3: based upon their body laning, which perhaps based upon the
2:01
Speaker 3: eye contact that they're making with witnesses, eye contact they
2:05
Speaker 3: may be making with a defendant, just the way they
2:08
Speaker 3: conduct themselves in the jury box. During the trial, it's
2:12
Speaker 3: inevitable that both the prostitution and the defense formed some
2:15
Speaker 3: belief as to which jurors may be favoring them as
2:19
Speaker 3: a trial unfold. In this case, when the judge decided
2:23
Speaker 3: that Jurors number six had to be removed. There was
2:26
Speaker 3: an objection by the Combs defense team, saying that it
2:30
Speaker 3: would create a mistrial. This was only one of two
2:33
Speaker 3: black men that was on the panel, and in this case,
2:36
Speaker 3: what you had was the removal of a black, middle
2:39
Speaker 3: aged man who was now replaced by the ultramate who
2:42
Speaker 3: happened to be an older white man. The defense argued
2:46
Speaker 3: that that was unfair, that it created a racial imbalance
2:49
Speaker 3: in the jury, but the judge ruled that race is
2:53
Speaker 3: not something that he can consider in terms of removal
2:56
Speaker 3: of a juror. Is something that is beyond the scope
3:00
Speaker 3: of what is relevant for consideration as to whether this
3:04
Speaker 3: juror can continue to sit on the jury panel, And
3:07
Speaker 3: they therefore remove Juris number six over the objections of
3:11
Speaker 3: the defense, the.
3:12
Speaker 2: Judge saying that he can't consider race. Do judges when
3:16
Speaker 2: they're seeding a jury consider the racial diversity of the panel.
3:22
Speaker 3: Well, what the case laws says is that you cannot
3:25
Speaker 3: discriminate against jurors based upon their race. So, for example,
3:30
Speaker 3: throughout what's called bladder which is a process by which
3:34
Speaker 3: both the defense and the prosecution select jurors, attorneys are
3:39
Speaker 3: allowed to ask various questions about potential jurors in order
3:44
Speaker 3: to determine whether or not they would like them to
3:46
Speaker 3: sit on the jury panel. They ask questions to try
3:49
Speaker 3: to learn about their background, whether they're being truthful, whether
3:52
Speaker 3: they think that they might be biased, and more importantly,
3:56
Speaker 3: from the defense side, they look at their life experience
3:59
Speaker 3: to decide whether or not it's somebody who they think
4:02
Speaker 3: could connect with a defendant who would be sympathetic to
4:06
Speaker 3: the situation that the defendants found themselves in and ultimately
4:09
Speaker 3: find the defense credible. When you're the prosecution, on the
4:12
Speaker 3: other hand, you're looking for jurors who are more law
4:15
Speaker 3: and order, people who follow the rules, people who believe
4:19
Speaker 3: in the rule of law, and people who are going
4:21
Speaker 3: to go into the trial with a mindset that favors
4:25
Speaker 3: the prosecution in the sense that they tend to believe
4:28
Speaker 3: law enforcement testimony unless there's a reason not to. The
4:32
Speaker 3: only time that race comes up during the blas Deer
4:36
Speaker 3: process is if there's an allegation by the defense that
4:40
Speaker 3: in some way the prosecution is trying to stack the
4:44
Speaker 3: deck by removing minorities or by removing people through the
4:48
Speaker 3: prosecution fields should not be on the jury for reasons
4:52
Speaker 3: that are discriminatory. In that case, the judge can actually
4:56
Speaker 3: question the witness and question the prosecutors or the defense
5:00
Speaker 3: about their reasons for trying to remove ajuror. Then, if
5:04
Speaker 3: a judge finds those reasons to be impermissible, the judge
5:07
Speaker 3: can force the prosecution to accept ajuror that they would
5:10
Speaker 3: otherwise try to reject.
5:12
Speaker 2: Obviously, there are alternates in case something like this does happen,
5:17
Speaker 2: but dismissing a juror is not something a judge does lightly.
5:21
Speaker 3: It's not an ideal situation from the standpoint of the
5:23
Speaker 3: judge to have to replace a juror mid trial, because
5:27
Speaker 3: it does raise questions about not only the conduct of
5:31
Speaker 3: the individual juror, but sometimes it also raises a question
5:35
Speaker 3: about whether other jurors may have been infected by improper
5:39
Speaker 3: conduct by the juror who's replaced. For example, if the
5:42
Speaker 3: allegation is that a juror was communicating with somebody outside
5:47
Speaker 3: of the jury about the case, or was receiving information
5:52
Speaker 3: about the trial other than what's being presented in the courtroom,
5:56
Speaker 3: that raises a serious concern that results in the removal
5:59
Speaker 3: of not only that or, but sometimes Judges then have
6:02
Speaker 3: to question the entire jury panel to make sure that
6:05
Speaker 3: any evidence that was not presented the trial that may
6:08
Speaker 3: have come from the outside did not infect other jurors
6:11
Speaker 3: that has not tanked the entire jury.
6:13
Speaker 2: All of a sudden, seeing that a juror has been
6:16
Speaker 2: dismissed after sitting there for weeks and weeks, does that
6:20
Speaker 2: have an effect or could it have an effect on
6:22
Speaker 2: the other jurors?
6:23
Speaker 3: Well, yeah, that's a great question, because the jurors obviously
6:27
Speaker 3: will be aware that there's a person who's been sitting
6:30
Speaker 3: there next to them for six weeks now, who's been
6:32
Speaker 3: sitting in the jury box, who's been spending time with
6:35
Speaker 3: them outside of the courtroom, and suddenly that person is
6:38
Speaker 3: not there, and the judge is not going to explain
6:41
Speaker 3: the actual reason for that juror's dismissal. Judges will typically
6:46
Speaker 3: tell other jurors that there are various reasons during the
6:50
Speaker 3: course of a trial that a juror might be replaced
6:52
Speaker 3: by an alternate, and that juror number six in this
6:55
Speaker 3: case is being replaced by an alternate without giving them
6:59
Speaker 3: reasons as to why that curor has been removed. But
7:03
Speaker 3: human nature being what it is there's no question that
7:06
Speaker 3: jurors will talk among themselves as to why that juror
7:09
Speaker 3: has been removed, and it's just a distraction and an
7:13
Speaker 3: injection of information into the jury room that judges would
7:17
Speaker 3: like to avoid. So they really try not to remove
7:20
Speaker 3: jurors during the course of a trial, but in some
7:23
Speaker 3: cases it's inevitable, and in this case, there was this
7:27
Speaker 3: lack of candor that the judge found that this juror
7:30
Speaker 3: may not really be a resident of the Southern District
7:33
Speaker 3: of New York. And if the juror was not removed,
7:35
Speaker 3: if the juror was allowed to remain on the panel,
7:39
Speaker 3: that's something that I'm sure the judge was concerned would
7:42
Speaker 3: be an issue on appeal. And so the judge really
7:44
Speaker 3: has to protect the record, he has to protect the
7:48
Speaker 3: trial so that ultimately, however it turns out, it will
7:51
Speaker 3: stand up on appeal.
7:53
Speaker 2: So now you have a forty one year old black
7:56
Speaker 2: man being replaced by a fifty seven year old white man,
8:00
Speaker 2: leaving just one black man on the jury. Is the
8:03
Speaker 2: chain here an issue for appeal?
8:06
Speaker 3: Well, I think we could expect the defense, if they
8:10
Speaker 3: get a conviction here, to raise it on appeal. Certainly,
8:14
Speaker 3: but it's difficult for the defense to argue when a
8:17
Speaker 3: black cur is replaced by a whiteer only on the
8:20
Speaker 3: basis of race, because what that does is it presupposes
8:24
Speaker 3: that a black cur would necessarily favor the defense simply
8:29
Speaker 3: because the defendant also happens to be black. That's not
8:32
Speaker 3: going to be enough to get a trial overturned. There
8:35
Speaker 3: has to be something more to it in order for
8:38
Speaker 3: them to really argue that they were unfairly prejudiced by
8:41
Speaker 3: the removal of that cur.
8:43
Speaker 2: It's unusual enough to have one juror dismissed mid trial,
8:47
Speaker 2: but now there's a possibility that a second juror might
8:51
Speaker 2: be dismissed. The facts are a little sketchy, but it
8:54
Speaker 2: appears that there are concerns that Jury number seven might
8:58
Speaker 2: have spoken improperly about the case.
9:02
Speaker 3: When a juror is torn in, they are given very
9:05
Speaker 3: strict rules that they are not to discuss the case
9:09
Speaker 3: outside of the courtroom. They're not to look at social media,
9:12
Speaker 3: they're not to read the news. They're not to talk
9:15
Speaker 3: about the case during their commute into the trial or
9:18
Speaker 3: on their way home. They're not to talk about the
9:20
Speaker 3: case with their spouse and the judge will instruct yours
9:24
Speaker 3: not to talk about the case with their fellow jurors
9:27
Speaker 3: until deliberations begin. They basically live inside a bubble and
9:32
Speaker 3: do not talk about what's going on in the courtroom,
9:35
Speaker 3: so they are under very strict rules, and sometimes in
9:38
Speaker 3: a high profile case this as this, judges will even
9:41
Speaker 3: go so far as the sequestered jurors, which means jurors
9:45
Speaker 3: do not get to live at home, they live in
9:47
Speaker 3: a hotel. They have no contact with the outside world.
9:50
Speaker 3: They can't watch TV, they can't read the newspaper. They
9:53
Speaker 3: are really cut off from all outside sources, so that
9:55
Speaker 3: their entire focus is only what is going on in
9:59
Speaker 3: the courtroom.
10:00
Speaker 2: At the end of the.
10:00
Speaker 3: Day, jurors have to make their decision about the guilt
10:05
Speaker 3: of the defendant or whether or not the prosecution met
10:07
Speaker 3: its burden of proof based solely upon the evidence that's
10:10
Speaker 3: presented in the courtroom and not based upon any outside
10:13
Speaker 3: the information here. There is some allegation at this point
10:17
Speaker 3: that the judge is looking into whether or not a
10:20
Speaker 3: juror may have communicated with somebody outside of the courtroom,
10:24
Speaker 3: and it's a violation of their oath to provide any
10:27
Speaker 3: information about what's going on in the trial to anybody
10:30
Speaker 3: outside the trial. It's also a violation for that curor
10:33
Speaker 3: to receive any information about what's going on in the
10:36
Speaker 3: trial from sources outside of the courtroom. So this is
10:39
Speaker 3: a serious allegation that the judge is going to have
10:42
Speaker 3: to spend some time getting to the bottom of the case.
10:46
Speaker 3: Cannot go on if there's the possibility that there is
10:49
Speaker 3: a tainted juror, because that could not only result in
10:52
Speaker 3: the removal of that juror, but the judge may well
10:55
Speaker 3: have to question other jurors to determine whether or not
10:58
Speaker 3: any information outside of the jury room and from outside
11:02
Speaker 3: the courtroom may have painted that jury, whether information that
11:06
Speaker 3: was not presented in the courtroom may have been discussed
11:09
Speaker 3: by jurors. This is going to be a bit of
11:11
Speaker 3: a side show. It's something that judges do not like
11:15
Speaker 3: to have to engage in because it's a distraction that
11:18
Speaker 3: will slow the case down and it may ultimately, in
11:21
Speaker 3: the worst case scenario, result in a mistrial, which means
11:24
Speaker 3: they would have to try the case all over again.
11:27
Speaker 3: So we'll have to see how this plays out. But
11:29
Speaker 3: the mere fact that there's a suggestion that a juror
11:32
Speaker 3: may have been communicating with somebody outside of the courtroom
11:35
Speaker 3: is a very troubling development for the prosecution.
11:39
Speaker 2: Bob, do you believe that jurors really don't talk to
11:43
Speaker 2: anyone about the case, even when the case takes months,
11:48
Speaker 2: They don't go home and say something to their husband
11:51
Speaker 2: or wife.
11:53
Speaker 3: Well, that is clearly what they are instructed to do,
11:56
Speaker 3: now whether they do it in actual practice, Most of
11:59
Speaker 3: the time, the prosecution, the defense, and the judge don't
12:03
Speaker 3: really know. There's a reason why the judge is always
12:07
Speaker 3: reluctant to peer behind the curtain and find out exactly
12:11
Speaker 3: what's going on in the jury room, because once you
12:13
Speaker 3: start asking juror's questions about what's going on, you don't
12:17
Speaker 3: exactly know what you are going to find. So unless
12:20
Speaker 3: there is some real clear cut evidence that a jury
12:24
Speaker 3: is doing something improper, that a juror is communicating with
12:27
Speaker 3: somebody outside of the courtroom, or that a juror has
12:30
Speaker 3: received information from outside of the trial that they shouldn't
12:33
Speaker 3: be receiving, judges are reluctant to go down the road
12:37
Speaker 3: to start questioning jurors during the course of a trial.
12:41
Speaker 3: But sometimes, like in this case, the judge simply has
12:44
Speaker 3: no choice. The judge can't ignore an allegation that this
12:48
Speaker 3: jury is possibly tainted, that one juror may have improperly
12:52
Speaker 3: communicated with somebody outside of the courtroom, and so he
12:57
Speaker 3: has no choice but to begin this process. Thing that
13:00
Speaker 3: troubles judges and troubles prosecutors is once you go down
13:04
Speaker 3: this road, you really don't know what you're gonna find
13:07
Speaker 3: when the judge starts to question yours. So that's why
13:10
Speaker 3: something judges are reluctant to do, and they only do
13:13
Speaker 3: it as in this circumstance where the judge really has
13:16
Speaker 3: no other choice.
13:18
Speaker 2: So the judge here is dealing with a very high
13:21
Speaker 2: profile case. Obviously there are news reports about every witness,
13:26
Speaker 2: et cetera. And this morning the judge was livid and
13:31
Speaker 2: he asked both the prosecution and the defense about an
13:35
Speaker 2: online article that appeared to include details from a sealed proceeding.
13:41
Speaker 2: He said, the court imposed a gag order on the government,
13:43
Speaker 2: the defend, and all attorneys for the defense, and anyone
13:46
Speaker 2: involved was made accountable. What happened here may result in
13:50
Speaker 2: civil or criminal contempt chargers for all involved.
13:54
Speaker 3: Well, you don't usually find defense lawyers or prosecutors talking
13:58
Speaker 3: about steal procede with somebody outside of the courtroom. Lawyers
14:03
Speaker 3: generally know that that would be a serious violation that
14:06
Speaker 3: the judge would take serious action against them, perhaps holding
14:09
Speaker 3: them in contempt or even a criminal violation for violating
14:14
Speaker 3: the stealing order and talking about a proceeding that was
14:17
Speaker 3: under steal with the media or somebody outside of the courtroom.
14:20
Speaker 3: But it can happen, and in a case like this
14:23
Speaker 3: where the media scrutiny has been so intense, where there's
14:27
Speaker 3: really been a complete saturation of coverage of every day
14:31
Speaker 3: of this trial, of every witness, of people talking about
14:34
Speaker 3: them on cable news, in the print, on the radio,
14:38
Speaker 3: the news of this trial has really become almost a
14:42
Speaker 3: circus in the sense of the level of coverage here.
14:45
Speaker 3: And so there's a lot of information out there, and
14:47
Speaker 3: the judge needs to make sure that he maintains control
14:51
Speaker 3: of that courtroom, and that means not only controlling what
14:54
Speaker 3: information may get in front of the jury, but also
14:57
Speaker 3: controlling the lawyers and making sure that the attorneys are
15:01
Speaker 3: playing their proper role arguing their case in the courtroom
15:04
Speaker 3: and not communicating with any outside sources improperly. I'm certainly
15:08
Speaker 3: not communicating about proceedings that were held under seal.
15:12
Speaker 2: Thanks so much, Bob. That's Robert Mints of Macarter and
15:15
Speaker 2: English coming up next, Harvard versus Trump again. I'm June Grosso.
15:20
Speaker 2: When you're listening to Bloomberg. Harvard is the main target
15:24
Speaker 2: of President Donald Trump's efforts to force universities to crack
15:28
Speaker 2: down on anti semitism, remove perceived political bias, and eliminate diversity,
15:34
Speaker 2: equity and inclusion programs. The university is already suing over
15:38
Speaker 2: the Trump administration's freezing of more than two point six
15:42
Speaker 2: billion dollars in federal research funding. The latest legal fight
15:46
Speaker 2: concerns the administration's refusal to give foreign students visas to
15:51
Speaker 2: attend Harvard. Boston federal Judge Allison Burrows has already issued
15:55
Speaker 2: a temporary order on Trump's proclamation, and at a hearing yesterday,
16:00
Speaker 2: she extended that order until June twenty third, while she
16:03
Speaker 2: weighs Harvard's request for a preliminary injunction. Joining me is
16:08
Speaker 2: Bloomberg legal reporter David Voriakis, who was at that hearing
16:11
Speaker 2: in Boston. David tell us about Trump's June fourth proclamation.
16:16
Speaker 4: The Trump administration said that the United States was going
16:20
Speaker 4: to bar visas for foreign nationals seeking to enter the
16:25
Speaker 4: United States to study or do research at Harvard, and
16:29
Speaker 4: that the administration also had the ability to review current
16:35
Speaker 4: students and researchers already in the United States to see
16:39
Speaker 4: if they should be removed as well. And Harvard sued immediately,
16:46
Speaker 4: and Judge Allison Burrows in Boston quickly entered a temporary
16:51
Speaker 4: restraining order, essentially maintaining the status quo and making sure
16:57
Speaker 4: that the Trump administration could not enforce the order.
17:00
Speaker 2: So is the administration doing anything like this to any
17:05
Speaker 2: other university.
17:06
Speaker 4: The administration is investigating a number of other universities and
17:11
Speaker 4: has indicated that it will suspend funding to other universities.
17:16
Speaker 4: But the extent of the broad based assault on Harvard
17:22
Speaker 4: has no match at any other university in the United States.
17:26
Speaker 2: So you were at the hearing yesterday. What was the
17:29
Speaker 2: main issue at the hearing?
17:31
Speaker 4: The issue is whether Judge Burrows should issue a preliminary
17:37
Speaker 4: injunction which would extend her temporary restraining order and cutting
17:42
Speaker 4: through the legal language. Should she continue to block the
17:47
Speaker 4: Trump administration from enforcing this proclamation while the litigation plays
17:52
Speaker 4: out It would not be a final order, but it
17:55
Speaker 4: would give Harvard some breathing room so that it could plan.
18:00
Speaker 4: If the proclamation went into effect, it could not accept
18:04
Speaker 4: foreign students or researchers for the upcoming semester, and that
18:10
Speaker 4: could have a potentially devastating effect on its student population,
18:16
Speaker 4: its finances, and its research program.
18:19
Speaker 2: I was surprised at how many students at Harvard are
18:23
Speaker 2: from other countries.
18:25
Speaker 4: It's twenty seven percent of the population, which is at
18:28
Speaker 4: a high proportion, but not as high as some other universities.
18:32
Speaker 4: But it also would have a significant financial impact on
18:37
Speaker 4: the university.
18:38
Speaker 2: So is the government's claim that Harvard is a national
18:41
Speaker 2: security risk? What is the government's claim here?
18:44
Speaker 4: The government's made several different claims over the last couple
18:48
Speaker 4: of months. One is that Harvard has inadequately addressed the
18:53
Speaker 4: problem of anti semitism on campus. Harvard acknowledges that there
18:58
Speaker 4: have been problems on camp and that it's taken steps
19:01
Speaker 4: to address them in the area of anti semitism. The
19:05
Speaker 4: Trump administration has also said that there's not sufficient viewpoint diversity,
19:11
Speaker 4: that it's too much of a woke university to liberal leaning,
19:15
Speaker 4: and that it needs to increase its ideological viewpoint. Across
19:20
Speaker 4: the spectrum, the Trump administration has also said that Harvard
19:25
Speaker 4: has done too much research and taken too much money
19:29
Speaker 4: from the Chinese government in the hundreds of millions of dollars.
19:34
Speaker 4: And then the final area is that the Trump administration
19:38
Speaker 4: has demanded records from Harvard about how it's disciplined students
19:45
Speaker 4: who've gotten into criminal or other administrative problems at the school.
19:51
Speaker 4: The administration says that Harvard's only turned over records on
19:56
Speaker 4: three students, which is clearly inadequate, and that the failure
20:01
Speaker 4: to adequately disclose records on student discipline poses a national
20:08
Speaker 4: security threat.
20:09
Speaker 2: Just say there is a lack of diversity. How does
20:11
Speaker 2: lack of diversity affect national security? How does you know
20:14
Speaker 2: anti semitism affect national security? I just don't understand the
20:18
Speaker 2: connection between what they're arguing is wrong with Harvard.
20:23
Speaker 4: As I understand it. What the Trump administration is arguing
20:27
Speaker 4: is not that all failings a Harvard pose national security risks.
20:32
Speaker 4: The national security risk that they are citing is that
20:35
Speaker 4: they're not turning over information on foreign students, which means
20:39
Speaker 4: that the United States cannot vet those students who are
20:43
Speaker 4: coming into the country or who are already in the country.
20:48
Speaker 2: And what is Harvard's response.
20:51
Speaker 4: Harvard's response is that this is all impermissible retaliation for
20:58
Speaker 4: Harvard exercising its First Amendment rights to hire the teachers
21:03
Speaker 4: that it wants, admit the students that it wants, and
21:06
Speaker 4: teach the curriculum that it wants, and that it refused
21:11
Speaker 4: the administration's demands in mid April to make a number
21:15
Speaker 4: of changes. And because of that refusal, the administration has
21:20
Speaker 4: engaged in an unceasing campaign of retaliation with a number
21:24
Speaker 4: of punitive steps. And it says that the law is
21:28
Speaker 4: on its side when it comes to the First Amendment,
21:31
Speaker 4: that it protects academic freedom, and it says that its
21:35
Speaker 4: First Amendment privileges Trump if you will the United States
21:42
Speaker 4: claim that the administration has unfettered ability to control visas
21:49
Speaker 4: and national security.
21:50
Speaker 2: Was the judge tougher on one side than the other?
21:53
Speaker 2: Were her questions leaning in one direction or another? I
21:56
Speaker 2: know she did say I can't imagine that anything you've
21:58
Speaker 2: described a place only to Harvard, right.
22:01
Speaker 4: It was a little hard to reach Judge Burrow's but
22:04
Speaker 4: given her track record in which she's sort of consistently
22:07
Speaker 4: ruled in Harvard's favor. I would bet that she's likely
22:12
Speaker 4: to grant a preliminary injunction here, But she clearly is
22:16
Speaker 4: troubled by this question of whether the Trump administration is
22:20
Speaker 4: in fact following the law in exercising its discretion to
22:27
Speaker 4: exclude a class of people who are entering the United
22:31
Speaker 4: States to study at Harvard. She asked a number of
22:34
Speaker 4: probing questions of the Harvard lawyer, suggesting that maybe it's
22:40
Speaker 4: a bit of a close call in her mind, but
22:42
Speaker 4: it was hard to tell for sure.
22:44
Speaker 2: Tell us about what the requirements are for getting a
22:48
Speaker 2: preliminary injunction.
22:49
Speaker 4: There are four legal factors, but the ones that really
22:53
Speaker 4: matter are the likelihood of success in the litigation as
22:57
Speaker 4: it progresses, and whether the action causes irreparable harm to
23:04
Speaker 4: the party that's suing. And Harvard says that the harm
23:08
Speaker 4: here is overwhelming and devastating, and that they are likely
23:13
Speaker 4: to succeed in showing that the Trump administration is retaliating
23:19
Speaker 4: in violation of its First Amendment free speech rights.
23:23
Speaker 2: What else has the Trump administration done to Harvard?
23:27
Speaker 4: Primarily, it's frozen about two point six billion dollars in
23:31
Speaker 4: research grants, which is the subject of a separate lawsuit
23:35
Speaker 4: that Harvard filed and that is also before Judge Burrows.
23:40
Speaker 4: It's also been subject to different government investigations, and Trump
23:46
Speaker 4: has said that he's considering pulling the tax exempt status
23:50
Speaker 4: of Harvard, which means the school would have to essentially
23:55
Speaker 4: pay a lot more money to operate.
23:58
Speaker 2: It's not legal for him to direct the IRS to
24:01
Speaker 2: pull the tax exempt status of a university of anybody.
24:04
Speaker 4: Well, they're trying to change the law that would make
24:07
Speaker 4: it legal. I'm not sure that it's legislation, but I
24:10
Speaker 4: think that they are posing new regulations through the Treasury
24:14
Speaker 4: Department right now. The procedure is that it has to
24:17
Speaker 4: go through IRS, and there's a whole long due process
24:22
Speaker 4: procedure that any organization that is threatened with losing its
24:27
Speaker 4: tax exempt status has an opportunity to have a hearing,
24:31
Speaker 4: they can appeal, and it goes on for some time.
24:35
Speaker 4: As I understand it, Treasury Secretary Besson would have that
24:41
Speaker 4: exclusive authority to determine whether an institution can maintain its
24:46
Speaker 4: tax exempt status. I don't know how that's going to
24:49
Speaker 4: play out, but that's my understanding of where it's headed.
24:53
Speaker 2: These all in front of Judge Burrows because one is
24:56
Speaker 2: in front of her, so they're signing the other ones
24:58
Speaker 2: to her too.
24:59
Speaker 4: I assume that the Clerk's office consider these to be
25:02
Speaker 4: related cases, and so typically civil litigation will move as
25:08
Speaker 4: a group if cases are related before a single judge.
25:12
Speaker 2: Do you have any idea when she'll have an opinion
25:14
Speaker 2: on the preliminary injunction.
25:16
Speaker 4: She indicated that she would rule by June twenty third,
25:19
Speaker 4: which is next Monday. There was a temporary restraining order
25:23
Speaker 4: that was in place until the end of the week.
25:27
Speaker 4: The government agreed to allow her to extend that until Monday,
25:31
Speaker 4: June twenty third, and then she said that she's likely
25:35
Speaker 4: to rule by then.
25:37
Speaker 2: Do you know anything about the attorneys that are representing Harvard.
25:40
Speaker 4: There are a number of attorneys in the litigation, and
25:44
Speaker 4: the one that argued on Monday was from Generin Block,
25:48
Speaker 4: so there were a number of Generan Block lawyers there.
25:51
Speaker 4: They're also represented by Quinn Emmanuel lawyers, and people from
25:56
Speaker 4: the Harvard Council's office were there, but the Justice Department
26:01
Speaker 4: had a single lawyer.
26:03
Speaker 2: Well. As you know, the government team is often dwarfed
26:06
Speaker 2: by the defense teams in high profile cases like this,
26:11
Speaker 2: and interestingly, Harvard is being represented by jennerin Block, which
26:16
Speaker 2: was one of the law firms targeted by Trump, one
26:20
Speaker 2: of the law firms that fought back and a federal
26:23
Speaker 2: judge struck down that executive order at the end of
26:27
Speaker 2: last month. Thanks so much, David. That's David voriankis Bloomberg
26:31
Speaker 2: Legal reporter. During the June first episode of The Totally
26:37
Speaker 2: Football Show with James Richardson, a podcast produced by The
26:41
Speaker 2: New York Times, listeners in the Washington, DC area heard
26:46
Speaker 2: a mysterious ad.
26:48
Speaker 1: Did you know that foreign investors are quietly funding lawsuits
26:51
Speaker 1: and American courts through a practice called third party litigation funding?
26:56
Speaker 1: Shadowy Overseas funders are paying to sue American companies in
27:00
Speaker 1: our courts, and they don't pay a time in US
27:03
Speaker 1: taxes if there is an award or settlement. They profit
27:06
Speaker 1: tax free from our legal system, while US companies are
27:09
Speaker 1: tied up in court and American families pay the price
27:13
Speaker 1: to the tune of five thousand dollars a year.
27:17
Speaker 2: The sixty second spot highlights an emerging strategy trying to
27:21
Speaker 2: turn consumers against the plaintiff's bar and litigation finance. Joining
27:27
Speaker 2: me is Bloomberg Law senior reporter Emily Siegel, who's written
27:31
Speaker 2: about this. Emily tell us about this ad and where
27:34
Speaker 2: it came from.
27:36
Speaker 5: A colleague was listening to that podcast and sent me
27:39
Speaker 5: a recording of the ad, and it was an advertisement
27:42
Speaker 5: that was basically anti litigation funding. They called them shadowy
27:46
Speaker 5: overseas funders and indicated that they don't pay any US
27:51
Speaker 5: taxes if there's an award or settlement, And there is
27:54
Speaker 5: no disclosure on the ad, which is required by the
27:58
Speaker 5: Federal Election Commission, and so we don't actually know who
28:02
Speaker 5: was behind it.
28:03
Speaker 2: I mean, how much do foreign investors invest in litigation financing?
28:10
Speaker 4: Do we know?
28:11
Speaker 5: We don't really know. I think that there are some
28:15
Speaker 5: funders that have sovereign wealth funds involved in as their investors,
28:19
Speaker 5: but we don't really know the extent of how much
28:23
Speaker 5: that's actually happening. So kind of unclear how often there
28:27
Speaker 5: are foreign investors involved. And also if you speak to
28:30
Speaker 5: any funders, the investors don't really play any role in
28:33
Speaker 5: case selection or how the case proceeds, or looking at documents.
28:38
Speaker 5: So even if there are foreign investors, at least from
28:41
Speaker 5: the funders I've spoken to, they'd say that there's no
28:44
Speaker 5: real involvement from any of the investors.
28:46
Speaker 2: So what is the purpose of this ad on a podcast?
28:50
Speaker 5: It seems to be pushing for a particular piece of
28:54
Speaker 5: legislation by Senator Tom Tillis which would add a forty
28:58
Speaker 5: one percent tax on litigation finance profits. It doesn't name
29:02
Speaker 5: that bill, but it does say that there is a
29:06
Speaker 5: solution and it would be taxing the industry, and it
29:09
Speaker 5: also urged the listeners to contact lawmakers and Republicans on
29:15
Speaker 5: Capitol Hill who could make the measure go forward.
29:18
Speaker 2: Tell us a little about that bill.
29:20
Speaker 5: Sure, So basically it would add at least a forty
29:24
Speaker 5: one percent tax. There are other provisions in the bill
29:27
Speaker 5: that indicate it could even be higher than that, and
29:30
Speaker 5: you know, a lot of the funders in the States
29:32
Speaker 5: are really unhappy with it. It was recently, as of
29:35
Speaker 5: last night, included in the text of the tax package,
29:40
Speaker 5: the Big Beautiful Bill, and it was just updated a
29:43
Speaker 5: new version of the tax and healthcare provisions and it
29:46
Speaker 5: was added in there. So I think there's a lot
29:48
Speaker 5: of people in the industry, the litigation finance industry, who
29:51
Speaker 5: are concerned that this can end up going through.
29:54
Speaker 2: So this would force foreign investors to pay taxes.
29:59
Speaker 5: It would force all investors, all litigation funders, whether they're
30:03
Speaker 5: foreign or not, to pay this tax, and that includes
30:07
Speaker 5: hedge funds and includes private equity firms that are also
30:10
Speaker 5: doing litigation finance. They would be taxed at this separate rate.
30:13
Speaker 2: There have been efforts at reform for decades. How is
30:18
Speaker 2: this different from what we've seen before.
30:21
Speaker 5: This version of the attack to litigation finance is new,
30:25
Speaker 5: but there have been I think at least three or
30:28
Speaker 5: four other congressional bills that have been introduced over the
30:31
Speaker 5: past couple of years. None of them have been successful,
30:34
Speaker 5: and they mostly focus on disclosure, which would mean that
30:38
Speaker 5: parties would have to file with the court whether they
30:40
Speaker 5: are receiving litigation funding. And so this is a totally
30:45
Speaker 5: different type of attack on the industry, and I think
30:48
Speaker 5: this one has funders more concerned because it has more
30:52
Speaker 5: of a chance going somewhere if it's part of the
30:55
Speaker 5: tax package.
30:56
Speaker 2: So with these ads, they're trying to turn consumer against
31:00
Speaker 2: the plaintiff's bar and litigation finance. I mean, is this
31:06
Speaker 2: an effort to turn the public against these large class
31:10
Speaker 2: action towards suits.
31:12
Speaker 5: A lot of these funders are doing mass towards in
31:15
Speaker 5: class action lawsuits, but a lot of them are just
31:17
Speaker 5: doing you know, corporate business to business sort of litigation.
31:22
Speaker 5: You know, one large business tough is another. So I
31:25
Speaker 5: don't know if the public has enough knowledge about this
31:29
Speaker 5: entire industry. It's it's new compared to other industries, and
31:34
Speaker 5: I think there's not a great sense of what it
31:37
Speaker 5: is they actually do. And there's a lot of coinflation
31:40
Speaker 5: between litigation finance and plaintiffs who receive some sort of
31:45
Speaker 5: loan against their settlement for paying rent for their medical bills,
31:49
Speaker 5: which are completely different types of industries. So I don't
31:53
Speaker 5: know that there's a lot of information out there, and
31:55
Speaker 5: a lot of these like the podcast ad, and there
31:58
Speaker 5: are other ads that are I've about in the story
32:01
Speaker 5: that are sort of an attempt to educate the public
32:04
Speaker 5: on what litigation finances, but it comes from a certain perspective.
32:08
Speaker 2: What are the costs. I know that the Chamber of
32:10
Speaker 2: Commerce has done an analysis of how much the toward
32:13
Speaker 2: system actually costs.
32:16
Speaker 5: Yeah, they say it could cost in each ceuse fold
32:20
Speaker 5: around I think four thy two hundred dollars, And then
32:23
Speaker 5: it is basically saying that litigation finance contributes to the
32:28
Speaker 5: rise in lawsuits it's hard to discern how they're getting
32:32
Speaker 5: that information if we're not really aware of how often
32:37
Speaker 5: litigation finance is used. So that's their calculations, and that
32:42
Speaker 5: the calculations from the US Chamber of Commerce are often
32:45
Speaker 5: used in these advertisements.
32:47
Speaker 2: Are there companies that are actively lobbying on this?
32:52
Speaker 5: Yeah, I think, you know, there are a bunch of
32:55
Speaker 5: different companies. I think Intel has lobbied on this. They're
32:59
Speaker 5: the recipient of a lot of patent lawsuits. Uber has
33:03
Speaker 5: funded one of the groups that is putting out advertisements,
33:06
Speaker 5: and they're also the recipient of a lot of lawsuits.
33:09
Speaker 5: So there are some big corporations. The insurance industry also,
33:14
Speaker 5: you know, has put out letters and support of bills
33:17
Speaker 5: like Fattilla's bill, and because they are usually again on
33:21
Speaker 5: the other side of cases that are being funded.
33:23
Speaker 2: Now there's a new group called Protecting American Consumers Together
33:29
Speaker 2: or PACKED. What's their goal?
33:33
Speaker 5: They seem to be sort of generally looking at tort
33:37
Speaker 5: reform and pushing for tort reform while also pushing for
33:41
Speaker 5: regulation of the litigation finance industry, and they do that
33:45
Speaker 5: through advertisements and education materials that they put out there.
33:49
Speaker 5: They say they were not behind this podcast ad. They
33:52
Speaker 5: do have some funding from Uber and they launched in
33:55
Speaker 5: January and they already had some success. Was a bill
33:58
Speaker 5: of tort reform package in Georgia that passed earlier this year,
34:03
Speaker 5: and it also included a litigation finance regulation provision.
34:07
Speaker 2: Does another group make America affordable again? What's its push?
34:12
Speaker 5: They have not, at least outwardly put anything out against
34:15
Speaker 5: litigation finance, but they're pushing for something called loser pays,
34:19
Speaker 5: which would mean that the person or the entity that
34:22
Speaker 5: files the lawsuit would have to pay the other side's
34:24
Speaker 5: legal bills if they lose. It seems to be the
34:27
Speaker 5: majority of their ads or focused on loser pays.
34:31
Speaker 2: And is that something that President Trump has commented on.
34:34
Speaker 5: I think that he has commented on it a little bit.
34:37
Speaker 5: There was a press conference in January during the California
34:41
Speaker 5: wildfires where someone asks him about it, and he seemed
34:44
Speaker 5: to like the idea. He said it would cut down costs,
34:48
Speaker 5: So it is something that he's expressed in interest in.
34:51
Speaker 5: He has directed the Justice Department to demand bonds from
34:54
Speaker 5: court challengers when judges temporarily halt his policies, but I
34:59
Speaker 5: don't think he's actually put out anything explicitly about loser
35:02
Speaker 5: pace and.
35:03
Speaker 2: Our litigation funders doing anything to fight back.
35:07
Speaker 5: Well, they have a group called the International Legal Finance
35:10
Speaker 5: Association which does a lot of their lobbying, and they
35:13
Speaker 5: have hired a new Republican lobbyist named Pete Kirkham according
35:18
Speaker 5: to a recent disclosure, So they are actively lobbying against
35:22
Speaker 5: this bill and that's pretty much their goal. I attended
35:25
Speaker 5: a conference a couple of weeks ago where other funders
35:29
Speaker 5: were urging people to join the group as members so
35:32
Speaker 5: that they could pay us to help fight against this
35:35
Speaker 5: sort of legislation.
35:37
Speaker 2: And as far as the ad itself is, it still playing.
35:42
Speaker 5: So I reached out to The Athletic, which was where
35:45
Speaker 5: we first discovered the ad. They're owned by The New
35:48
Speaker 5: York Times, and they said that they had requested from
35:51
Speaker 5: their vendor to have the ad taken down. The vendors
35:54
Speaker 5: a company called a Cast and they do a lot
35:56
Speaker 5: of podcasts. So I reached out to them and they
35:59
Speaker 5: said they've put issue to takedown notice and that the
36:02
Speaker 5: ad would not play on any of their platforms anymore.
36:06
Speaker 5: It just has something that it was an error. They
36:08
Speaker 5: would not say who paid for the ad.
36:11
Speaker 2: So the mystery continues. Thanks so much, Emily. That's Emily Siegel,
36:16
Speaker 2: Bloomberg Law Senior Reporter. And that's it for this edition
36:20
Speaker 2: of The Bloomberg Law Show. Remember you can always get
36:22
Speaker 2: the latest legal news on our Bloomberg Law Podcast. You
36:26
Speaker 2: can find them on Apple Podcasts, Spotify, and at www
36:30
Speaker 2: dot Bloomberg dot com, slash podcast Slash Law, and remember
36:34
Speaker 2: to tune into The Bloomberg Law Show every weeknight at
36:37
Speaker 2: ten pm Wall Street Time. I'm June Grosso and you're
36:41
Speaker 2: listening to Bloomberg