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Unions Wait on Elections & $30 Million Pardon Scheme · Bloomberg Law

0:02
Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.
0:08
Speaker 2: During the elections, President Trump made his position on unions
0:13
Speaker 2: cleared during a conversation with Elon Musk last August. I mean,
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Speaker 2: I look at what you do. You walk quit, they
0:21
Speaker 2: go on strike. I won't mention the name of the company,
0:24
Speaker 2: but they go on strike and use it.
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Speaker 3: That's okay. You're all gone.
0:27
Speaker 2: You're all gone.
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Speaker 4: So every one of you is gone, and you are
0:29
Speaker 4: the greatest. You would be very good.
0:31
Speaker 2: And in the past six months, Trump has ended collective
0:35
Speaker 2: bargaining for two thirds of the federal workforce, effectively paralyzed
0:39
Speaker 2: the federal agency tasked with adjudicating unfair labor practices and
0:44
Speaker 2: disputes over union elections, and rescinded the minimum wage that
0:49
Speaker 2: federal contractors have to pay the workers, just to name
0:52
Speaker 2: a few of Trump's anti union actions. So it may
0:56
Speaker 2: not be so surprising that there has also been a
1:00
Speaker 2: significant drop in union elections and petitions to the National
1:05
Speaker 2: Labor Relations Board in the last six months. That stands
1:09
Speaker 2: in contrast to the previous three years, where there were
1:12
Speaker 2: a historic number of union elections, representation petitions, and unfair
1:17
Speaker 2: labor practice charges filed each year. My guest is Anne Lafusso,
1:23
Speaker 2: a professor at the University of Cincinnati Law School and
1:26
Speaker 2: an expert in labor law. And the average number of
1:31
Speaker 2: newly certified unions per month dropped twenty two point three
1:36
Speaker 2: percent in the first six months of this second Trump
1:39
Speaker 2: administration compared to the last six months of the Biden administration,
1:44
Speaker 2: and there has been a fifteen point eight percent drop
1:47
Speaker 2: in the number of representation petitions filed in that same
1:51
Speaker 2: time period. How do you account for this significant drop?
1:55
Speaker 4: I think you have to look at both sides of
1:57
Speaker 4: the equation. First, you had historic increased under Biden, a
2:03
Speaker 4: progressive general Counsels. The board was relatively progressive, but not
2:09
Speaker 4: quite as progressive as Jennifer Brusso was. So Brusso was
2:12
Speaker 4: aggressively progressive. She looked at the law and she interpreted
2:18
Speaker 4: the law in a way that, in my view at least,
2:20
Speaker 4: was reasonable. But on the progressive side, the law can
2:23
Speaker 4: always be interpreted more progressively or more conservatively, more pro
2:27
Speaker 4: union or more pro business. And it's not like the
2:29
Speaker 4: law has a single meaning. And she was on the
2:32
Speaker 4: very progressive side, and that emboldened and encouraged unions to
2:37
Speaker 4: file election petitions and also defile unfair labored practice charges,
2:42
Speaker 4: even where it might have been a more if the
2:45
Speaker 4: theory of why they were being unfairly treated iffy because
2:49
Speaker 4: in the past they may not have gotten that theory
2:52
Speaker 4: validated for the board. So that's going to increase the numbers.
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Speaker 4: Then when Trump came in, they're remembering the first Trump Board,
3:00
Speaker 4: and the first Trump board as progressive as Jennifer Brutto was,
3:04
Speaker 4: it was reactionary. It was extremely to the right, much
3:09
Speaker 4: more pro business and even in some instances I would
3:13
Speaker 4: say not just pro business, but anti union more so
3:16
Speaker 4: than any other board ever in the history of the
3:19
Speaker 4: National Labor Relations Board. And they're remembering this and it
3:23
Speaker 4: was very painful for them. So they're in this sort
3:26
Speaker 4: of wait and see pattern, anticipating the worst. So I'm
3:31
Speaker 4: at a conference right now and I'm listening to people
3:33
Speaker 4: and they don't want to file petitions right now because
3:36
Speaker 4: they are really afraid. Now the board doesn't have a quorum,
3:40
Speaker 4: so they really don't know exactly what's going to happen.
3:45
Speaker 4: I personally don't think that the Trump two board will
3:48
Speaker 4: be as reactionary as the Trump one board. I could
3:51
Speaker 4: be wrong.
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Speaker 2: What makes you say that when Trump has a pointed
3:55
Speaker 2: a conservative as general counsel.
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Speaker 4: The reason I'm saying this, though, is because the general counsel, Cowan,
4:01
Speaker 4: who is a conservative man, so he's going to interpret
4:04
Speaker 4: the law in a more conservative fashion, is going to
4:06
Speaker 4: be more pro business fashion. However, he's an institutionalist. He's
4:11
Speaker 4: been the regional director for one of the regions out
4:14
Speaker 4: in the West, I think in California for a long time.
4:17
Speaker 4: He was a board member. He's loved by everyone. He
4:20
Speaker 4: was at the board when I was there, Everyone loved him.
4:23
Speaker 4: He was just kind, he was easy to work with.
4:26
Speaker 4: He doesn't want to destroy the agency. Also, people Trump
4:30
Speaker 4: put forward for the board, they're also institutionalists. He could
4:34
Speaker 4: have picked people that had union busting careers and he
4:37
Speaker 4: doesn't seem to be doing that. So it's possible that
4:42
Speaker 4: the fear that's going on is an overreaction. But I
4:46
Speaker 4: think at least they're waiting and seeing what this board
4:49
Speaker 4: will do. So when you put those two things together, though,
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Speaker 4: the sort of record highs and then the remembering of
4:57
Speaker 4: what the Trump board did in his first administration, and
5:00
Speaker 4: you get this huge swing. I don't know if it's
5:03
Speaker 4: gonna last. It's gonna be very interesting to see, and
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Speaker 4: I think it's gonna depend on what this board starts
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Speaker 4: doing and whether it was willing to dismantle precedents.
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Speaker 2: I mean, the board right now doesn't have a quorum
5:13
Speaker 2: right correct, So what can they do.
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Speaker 4: The board itself, meaning the five board members, can't do anything.
5:20
Speaker 4: The agency can do quite a bit, so the General
5:23
Speaker 4: Council can issue complaints, the regions can investigate charges, the
5:28
Speaker 4: region can hold elections. They just can't be board certified.
5:33
Speaker 4: So there's plenty of things that can happen. So I
5:36
Speaker 4: don't think these numbers are necessarily because the board doesn't acorum.
5:39
Speaker 4: Maybe some of them are design Well, if they can't
5:41
Speaker 4: be certified right now, then maybe we should wait. That
5:44
Speaker 4: could explain some of them. But there's a lot that
5:47
Speaker 4: can do, certainly on the unfair labor practice side right
5:49
Speaker 4: because it takes a while for you to have an
5:51
Speaker 4: ALGA hearing, there's gonna be a board within the year,
5:54
Speaker 4: and you might want to get at least the hearing done.
5:57
Speaker 4: I mean, I heard yesterday one of the U organizers
6:01
Speaker 4: was telling me that he is something that's been six
6:03
Speaker 4: years before the board, So there are some big backlogs.
6:08
Speaker 4: That's an unusual case, but I've heard about longer than
6:11
Speaker 4: that also. And by the way, this is not just
6:13
Speaker 4: from the Biden and Trump era. When I was there
6:17
Speaker 4: under Bush and Clinton, they were like long delays also,
6:20
Speaker 4: And we don't know whether I think every board does
6:22
Speaker 4: this to some extent. If it's a really difficult issues,
6:25
Speaker 4: sometimes they just think about it and then they run
6:27
Speaker 4: out of time because they no longer have a quorum
6:30
Speaker 4: or something. And that's become more and more usual since
6:35
Speaker 4: the early two thousands, when Congress has decided not always
6:40
Speaker 4: to fill those spots. So with a more dysfunctional Congress,
6:45
Speaker 4: you have these times where the government's not functioning. The
6:49
Speaker 4: administrative agencies are not functioning because they don't have officials
6:53
Speaker 4: who have been appointed by the president and confirmed by Congress,
6:57
Speaker 4: so you get these backlogs.
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Speaker 2: Also, is this is this reluctance coming from the union
7:03
Speaker 2: leaders or the workers who might fear the political climate,
7:08
Speaker 2: especially in light of the economy and the labor market.
7:12
Speaker 2: I mean, where's it coming from?
7:14
Speaker 4: Oh? Both, definitely. So from the worker's point of view,
7:17
Speaker 4: they're scared. There are people that are afraid to even
7:20
Speaker 4: speak out against the president for fear of retaliation because
7:25
Speaker 4: we saw that the president decided to fire a large
7:28
Speaker 4: percentage of the federal workforce, which he has direct control over.
7:31
Speaker 4: So people are afraid to speak out. Now. Whether that's
7:35
Speaker 4: justified or not, the historians will tell us that, but
7:37
Speaker 4: people certainly are afraid, and so they don't want to
7:40
Speaker 4: stick their necks out right now. But union leaders who
7:43
Speaker 4: are thinking about these things and hearing from their constituents
7:48
Speaker 4: are also concerned, and they're more in the wait and
7:51
Speaker 4: see pattern, like, well, let's see what's going on. But
7:54
Speaker 4: the workers themselves, i think, are afraid. And they're also
7:58
Speaker 4: afraid because the economy is than is good. So when
8:01
Speaker 4: you had a much better economy, which despite what everyone
8:05
Speaker 4: was saying, we had a pretty good economy under Biden,
8:07
Speaker 4: but the economy has been going down and down, and
8:11
Speaker 4: the market, the labor market is much tougher right now.
8:15
Speaker 4: There's no flacks in the labor market, so it's hard
8:18
Speaker 4: if you get fired from a job right now. Let's
8:21
Speaker 4: say you're unjustly fired because you're a union activist, you
8:25
Speaker 4: may not get another job. It's very tough. So this
8:30
Speaker 4: makes people afraid to organize, and it makes the labor
8:34
Speaker 4: organizer's job and the labor union leader's job that much
8:37
Speaker 4: more difficult.
8:38
Speaker 2: You say, wait and see, but don't the unions already
8:42
Speaker 2: know where Trump stands, especially with the executive order that
8:46
Speaker 2: he issued ending collective bargaining for two thirds of the
8:51
Speaker 2: federal workforce. Even before Trump took office, student athletes dropped
8:56
Speaker 2: organizing efforts at Dartmouth College and the Universe Stay of
9:00
Speaker 2: Southern California.
9:02
Speaker 4: Well, that was smart of them, because the General Council
9:05
Speaker 4: has withdrawn of Brusso's memo, her General Council Memo stating
9:10
Speaker 4: that student athletes are actually employees and should have the
9:14
Speaker 4: protections of the board. So we do know almost certainly
9:18
Speaker 4: what this board would do with that. So in that issue,
9:21
Speaker 4: it's pretty clear. But there are sometimes some very easy issues.
9:25
Speaker 4: For example, remember the early two thousands when Bush was
9:28
Speaker 4: the president. Chamber and Wilma Leibman, two people that couldn't
9:33
Speaker 4: be further apart. A progressive Leaveman and a conservative Chamber
9:37
Speaker 4: and very conservative Chamber. They've agreed on six hundred cases together.
9:41
Speaker 4: Now they were all found voids by the Supreme Court
9:44
Speaker 4: because there was only two and they weren't a quorum,
9:46
Speaker 4: but not because of what they decided. Those were all
9:49
Speaker 4: easy cases. There's plenty of easy cases to go forward.
9:53
Speaker 4: What they're waiting and seeing on and I think what
9:57
Speaker 4: they are going to not do is we're not I'm
10:00
Speaker 4: not going to see them pushing the envelope on anything
10:03
Speaker 4: like I would be surprised if beingan say Okay, we're
10:06
Speaker 4: going to ask for expanded remedies right now. I wouldn't
10:08
Speaker 4: ask for them because I wouldn't want that precedent to
10:11
Speaker 4: go before a court. First of all, I wouldn't want
10:14
Speaker 4: to go before the board, and then I wouldn't want
10:16
Speaker 4: to go before the court because of what could happen.
10:19
Speaker 4: So they're not going to push the student athlete issue
10:21
Speaker 4: right now. So if I were student athletes right now,
10:24
Speaker 4: I might go for a voluntary recognition, but I wouldn't
10:27
Speaker 4: go for anything else. So I understand those issues, but
10:31
Speaker 4: we don't really know. Yes, I agree with you that
10:34
Speaker 4: the executive order and many of these executive roles, but
10:37
Speaker 4: I'm thinking one in particular, the president is trying to
10:39
Speaker 4: control the administrative agencies a lot more, and the presidents
10:43
Speaker 4: taking the position that he can fire board members, and
10:46
Speaker 4: only the Supreme Court can tell us if that's true.
10:48
Speaker 4: My guess is, even though right now the precedent at
10:52
Speaker 4: the Supreme Court is that he can't fire commissioners or
10:57
Speaker 4: board members, that they are likely to reverse that oly
11:00
Speaker 4: a split a divided vote, and I'm talking about Humphrey's executor.
11:04
Speaker 4: So if he can fire anyone at will, if he
11:08
Speaker 4: doesn't like a decision that comes out of the board,
11:11
Speaker 4: then he'll just fire the person. So I'm sure that
11:14
Speaker 4: these board members are going to be somewhat more beholden
11:16
Speaker 4: to the president than they normally were in an independent
11:19
Speaker 4: agency where they really were independent of the president. I
11:23
Speaker 4: think that will happen. And let's face it, he already
11:25
Speaker 4: fired Wilcox, Member Wilcox, and I do want to remind
11:28
Speaker 4: the audience that she was the first black female board member,
11:32
Speaker 4: and so the look is very, very bad that he
11:36
Speaker 4: decides to fire the first board member but not the Democrat,
11:39
Speaker 4: white male, And again that could be a coincidence, I
11:43
Speaker 4: don't know, but it is a very bad look and
11:46
Speaker 4: so it does send a message definitely. But again, the
11:50
Speaker 4: president is not going to fire a board member because
11:54
Speaker 4: of an obvious, simple case of enforcing the law. I
11:58
Speaker 4: think what he would do if it's something that gets
12:01
Speaker 4: the chamber upset, that gets Starbucks or Amazon upset, And
12:05
Speaker 4: that doesn't mean Starbucks losing a case or an election.
12:09
Speaker 4: I mean where Starbucks And this is ridiculous because these
12:12
Speaker 4: are expanded remedies or something like that. So yes, I
12:16
Speaker 4: think it's just a more nuanced than People always have
12:20
Speaker 4: sound bites and they always sort of feel when they're
12:22
Speaker 4: in the moment one way or the other. And I
12:26
Speaker 4: at least am taking also a wait and see and
12:30
Speaker 4: I'm optimistic that it will not be as bad for
12:35
Speaker 4: unions as it was other than trump one administration. Let
12:39
Speaker 4: me put this way, I wouldn't bet on what I'm saying.
12:40
Speaker 4: I just think it's more likely than not, like forty
12:43
Speaker 4: nine to fifty one percent. That's where I'm at.
12:45
Speaker 2: Coming up next on the Bloomberg Law Show, I'll continue
12:47
Speaker 2: this conversation with Professor and lafosso how unions are already
12:52
Speaker 2: playing defense. I'm June Grosso and you're listening to Bloomberg.
12:58
Speaker 2: A significant draw in union elections and petitions to the
13:02
Speaker 2: National Labor Relations Board in the first six months of
13:06
Speaker 2: President Donald Trump's second term show that organized labor is
13:11
Speaker 2: wary of risking disputes that could lead to unfavorable rulings
13:15
Speaker 2: with broader implications. This year's organizing slump is a stark
13:20
Speaker 2: contrast to the previous three years, where the NLRB saw
13:25
Speaker 2: historic numbers of representation petitions, union elections, and unfair labor
13:30
Speaker 2: practice charges filed each year. I've been talking to Professor
13:34
Speaker 2: An Lafasso of the University of Cincinnati Law School. Would
13:39
Speaker 2: you say that labor unions are playing a defensive role already?
13:44
Speaker 2: They're sort of on the front lines of some of
13:47
Speaker 2: the legal fights against Trump's reduction inforced plans and moves
13:52
Speaker 2: to exclude two thirds of the workforce from collective bargaining rights,
13:57
Speaker 2: and initiatives that shutter agents and affect universities.
14:03
Speaker 4: Absolutely, unions are definitely on the defensive and they're concerned.
14:09
Speaker 4: There's a lot of things means can do, but remember,
14:13
Speaker 4: whatever they do for their members, they also can't live
14:16
Speaker 4: without members. They need fees because organizing takes money and
14:21
Speaker 4: getting benefits for their members takes money. So they are
14:26
Speaker 4: on the defensive and they want to survive, and this
14:30
Speaker 4: is in their mind.
14:31
Speaker 2: Again.
14:31
Speaker 4: I can't get into the mind of every union, but
14:33
Speaker 4: I wouldn't be surprised if for them this is an
14:35
Speaker 4: existential threat. That's how higher education feels right now. I mean,
14:39
Speaker 4: I'm a member of a union at my university, and
14:42
Speaker 4: we certainly feel that this is an existential threat. People
14:46
Speaker 4: are palpably afraid. And by the way, we're a public institution.
14:51
Speaker 4: So what's going on in public institutions is at the
14:53
Speaker 4: state level, more at the state level, but it's the
14:56
Speaker 4: same kind of thing that's going on at least in
14:59
Speaker 4: the red state. And I'm in Ohio, which is even
15:02
Speaker 4: though Cincinnati is a blue area, the University of Cincinnati
15:06
Speaker 4: is a state institution, so we have a state legislature.
15:10
Speaker 4: So we are part of the same thing that's going
15:12
Speaker 4: on in West Virginia and other red states that are
15:16
Speaker 4: part of this idea that unions are not good for
15:20
Speaker 4: the economy and that higher education is left wing propaganda.
15:26
Speaker 4: And I think a lot of us are afraid to
15:29
Speaker 4: speak out. We're afraid. What are we going to do?
15:31
Speaker 4: We want to keep our jobs even ten years on
15:33
Speaker 4: the line. So it's going on all over the country.
15:38
Speaker 2: Is there a sort of culture shock because you went
15:41
Speaker 2: from a president who was walking picket lines with striking
15:45
Speaker 2: workers to Trumpoo's signing executive orders to limit union rights.
15:53
Speaker 4: Probably for a lot of people, it didn't surprise me
15:56
Speaker 4: because the whiplash has been going on for so long
16:00
Speaker 4: studied it, so it was exactly what I expected. But
16:03
Speaker 4: I do think that for many people, especially younger people, right,
16:09
Speaker 4: because they don't have that historical I think when you're young,
16:13
Speaker 4: you forget there was an existence before you were born, Right,
16:16
Speaker 4: You just are born and then this is what you
16:18
Speaker 4: grew up. Right. I mean, I have a twenty one
16:19
Speaker 4: year old daughter, and so what has she gone through?
16:22
Speaker 4: What is she seeing?
16:23
Speaker 1: Right?
16:24
Speaker 4: And her memories are of Biden mostly a little bit
16:27
Speaker 4: of Trump right, And so there is a whiplash for
16:30
Speaker 4: a lot of people, and also people who don't pay
16:32
Speaker 4: attention as much, but now they're in a union. I'm
16:35
Speaker 4: sure there's also a cultural whiplash. For those of us
16:39
Speaker 4: who study labor law, we knew this was going to happen.
16:43
Speaker 4: None of us were surprised at all of any of this.
16:46
Speaker 2: By laying back, now, is there a risk to the
16:49
Speaker 2: momentum that the unions seem to have picked up in
16:52
Speaker 2: the last few years.
16:54
Speaker 4: There's a concern about that. So the concern is, Okay,
16:58
Speaker 4: if we stop organized, I think we lose our momentum.
17:01
Speaker 4: But if we organize, we might get bad results. This
17:04
Speaker 4: is why you're in this paralysis this way, and see,
17:07
Speaker 4: because there's this one push to kind of keep the
17:10
Speaker 4: momentum up. People want unions more than ever in like
17:13
Speaker 4: at least the last seventy five years. Well it could
17:15
Speaker 4: be longer even, you know. So they're more popular today
17:19
Speaker 4: than they've been certainly in my lifetime. But at the
17:22
Speaker 4: same time, you have an administration that's more hostile to
17:27
Speaker 4: unions definitely since before FDR, so before the New Deal,
17:33
Speaker 4: you know, when you have the horrors of what was
17:35
Speaker 4: going on in the Industrial Revolution and the hostility to
17:39
Speaker 4: unions back then. So there is a paralysis right now,
17:43
Speaker 4: and you know which way do we go. You're at
17:46
Speaker 4: a path that's splitting right now. Now. Do you go
17:50
Speaker 4: in this relatively aggressive way and continue the momentum or
17:54
Speaker 4: do you stop or do you do something less aggressive
17:58
Speaker 4: but you can keep up the momentum. What is the
18:00
Speaker 4: right choice? And I think people don't know what the
18:03
Speaker 4: right choice is right now, and that's that's the problem.
18:06
Speaker 2: What role will the Supreme Court play. You talked about Wilcox.
18:11
Speaker 2: In that case, we'll probably go up to the Supreme Court.
18:14
Speaker 2: But what about other decisions. Is there anything likely to
18:17
Speaker 2: come before the Supreme Court, which has ruled against unions
18:21
Speaker 2: time and time again recently.
18:23
Speaker 4: Yeah, I think the strategy will be for unions to
18:27
Speaker 4: keep those cases out of the Supreme Court. If they lose,
18:30
Speaker 4: they won't petition for sorcerai. If they win, fits out
18:34
Speaker 4: of their hands the employer will petition. But the problem
18:38
Speaker 4: is that the board going to be more pro employer
18:43
Speaker 4: is going to flip positions, and so they might be
18:46
Speaker 4: able to keep a lot of things out of the
18:48
Speaker 4: Supreme Court. They won't be able to keep the administrative stuff,
18:50
Speaker 4: the constitutional stuff out because the Supreme Courts can be
18:53
Speaker 4: really interested in things like the Wilcox decision, but the
18:56
Speaker 4: actual labor law decisions. What I think is more likely
18:59
Speaker 4: is that they can get a decision up there about
19:03
Speaker 4: whether or not the board was entitled defference. And so
19:08
Speaker 4: a lot of people think that's a dead end because
19:10
Speaker 4: of Low or Bright overrules Chevron, But there's still difference,
19:14
Speaker 4: and there's certain types of difference, and right now the
19:16
Speaker 4: courts are split on how to what that difference looks like.
19:21
Speaker 4: Is it completely denovo so there's absolutely no difference. We
19:24
Speaker 4: know there's not complete difference like there was Undershovar, which
19:27
Speaker 4: was not complete, but it was very, very deferential. But
19:32
Speaker 4: there's also something called skidmore difference, where you take into
19:36
Speaker 4: consideration the history and the purpose of the act and
19:39
Speaker 4: what the board has done in the past. So it's
19:42
Speaker 4: interesting that some courts aren't doing that at all, like
19:47
Speaker 4: the Fifth Circuit and to some extent of sixth Circuit,
19:50
Speaker 4: and other courts are really struggling with that, like the
19:52
Speaker 4: Third Circuit that's really thinking about that in a very
19:55
Speaker 4: nuanced way. I applauded the Third Circuit for is doing so.
19:59
Speaker 4: I think that is more likely to come up and
20:02
Speaker 4: what the labor issue is would be more accidental and
20:05
Speaker 4: maybe even surprising.
20:06
Speaker 2: You talked about whiplash.
20:08
Speaker 1: This is a big, big picture.
20:10
Speaker 2: Are unions forever dependent on you know, which administration is
20:14
Speaker 2: in power.
20:16
Speaker 4: Maybe? On the other hand, maybe not. Because one of
20:20
Speaker 4: the things that Supremecourt wants to accomplished by overturning Chevron
20:24
Speaker 4: through its life or Bright decision was to stop this
20:27
Speaker 4: whiplash and saying we are the final arbiters of what
20:31
Speaker 4: the law is. And therefore I think in the long
20:36
Speaker 4: run there's going to be more labor issues going up
20:38
Speaker 4: to the Supreme Court again, because the court is going
20:41
Speaker 4: to decide when there's a big whiplash like this, they're
20:45
Speaker 4: going to say, we can't have this, we can't just
20:47
Speaker 4: keep in going back and forth. So you can see
20:49
Speaker 4: a lot of the old decisions that were done before Chevron.
20:53
Speaker 4: No one's going to touch those. I would be really surprised,
20:56
Speaker 4: like Republic Aviation and will leach Mir Republica Vias very
21:00
Speaker 4: pro union. Leachmere is not pro unions for pro business,
21:03
Speaker 4: but there are similar issues those cases. They were done
21:07
Speaker 4: before Chevron, and there was there was a lot more stability,
21:11
Speaker 4: but as you gave the board difference and as long
21:14
Speaker 4: as they just explained their change, the courts were sort
21:17
Speaker 4: of hamstrung unless there were individual judges that just were
21:21
Speaker 4: not going to give them difference, which there were. There
21:23
Speaker 4: were individual judges not paying much attention to Chevrons for
21:26
Speaker 4: various reasons. So I think that the Supreme Court may
21:31
Speaker 4: just decide these things now with a very conservative court,
21:34
Speaker 4: they may decide them in a way that unions don't like,
21:37
Speaker 4: So that would be the downside until the court becomes
21:40
Speaker 4: once again more progressive, which will happen. I mean, there's
21:43
Speaker 4: always going to be changed, but of course the supprove
21:45
Speaker 4: Court changes much more slowly, so there won't be a whiplash.
21:49
Speaker 4: With agencies, they're much more accountable to whatever the democratic
21:53
Speaker 4: process was, So whoever's in power, it can change every
21:57
Speaker 4: four years. It rarely goes more than eight years without
21:59
Speaker 4: a case occasionally. I mean, the one I can think
22:01
Speaker 4: of was Reagan. Reagan to Bush. There was twelve years
22:04
Speaker 4: of Republican rule, and then you had eight years of Clinton,
22:10
Speaker 4: eight years of Bush, and then eight years and then
22:13
Speaker 4: four to four and it will be four again, and
22:16
Speaker 4: then we'll see if it goes to a Republican or
22:18
Speaker 4: a Democrat. And then it's the president who decides the
22:21
Speaker 4: Supreme Court. But you have to have the openings the president,
22:26
Speaker 4: especially if they can fire board members, they can literally
22:29
Speaker 4: change extremely quickly, extremely quickly, and that's your whiplash. So
22:35
Speaker 4: I think the hope is among business people, especially because
22:40
Speaker 4: businesses can survive, but they don't like environments where the
22:43
Speaker 4: laws are not predictable. I think that we might see
22:47
Speaker 4: some a little bit more stability. Maybe not in the
22:50
Speaker 4: short run, but in the long run we might see
22:52
Speaker 4: more stability. Again, I'm taking a look and see. I'm
22:55
Speaker 4: waiting because while that would be my logical, rational take
23:00
Speaker 4: on this, humans are not always rational, so who knows
23:03
Speaker 4: what's going to happen, So we'll see. I just want
23:06
Speaker 4: to say that I'm at this wonderful conference right now
23:09
Speaker 4: for musicians and just wanted to remind people that musicians
23:12
Speaker 4: are workers, and they work under very difficult conditions. Hence
23:16
Speaker 4: they are totally trying to organize, and that people should
23:21
Speaker 4: support musicians.
23:22
Speaker 2: Thanks so much.
23:23
Speaker 4: An.
23:24
Speaker 2: That's Professor An Lafasso at the University of Cincinnati Law School.
23:28
Speaker 2: Coming up next, a thirty million dollar pardon scheme. This
23:33
Speaker 2: is Bloomberg. The audacious plan crystallized over a lobster dinner
23:40
Speaker 2: in Puerto Rico. That's where a self styled connector and
23:45
Speaker 2: a child actor turned crypto enthusiast hatched an idea to
23:49
Speaker 2: secure a presidential pardon for bitcoin booster Roger Verr, also
23:55
Speaker 2: known as Bitcoin Jesus, and in the process make millions
23:59
Speaker 2: for themselves, specifically thirty million. Joining me is Bloomberg. Legal
24:05
Speaker 2: reporter Eva Benni Morrison, who wrote about this scheme, eva
24:09
Speaker 2: they only had tenuous ties to Verr, why did they
24:14
Speaker 2: decide to try to get him a pardon.
24:16
Speaker 3: There has been a lot of enthusiasm around the clemency
24:19
Speaker 3: process since President Trump took office in January. He has
24:23
Speaker 3: certainly approached his clemency powers with more vigor than some
24:28
Speaker 3: of his predecessors.
24:29
Speaker 1: And that's instilled a.
24:30
Speaker 3: Lot of hope in people who want to try and
24:33
Speaker 3: get their case in front of the White House for relief. So,
24:36
Speaker 3: in this situation, Roger ver who is an early investor
24:41
Speaker 3: in bitcoin and he is currently under indictment for tax
24:44
Speaker 3: evation in California, he was very vocal about wanting a pardon,
24:48
Speaker 3: and he had been on social media and sitting down
24:50
Speaker 3: for interviews with conservative commentators talking about his battle with
24:54
Speaker 3: US authorities and making a direct appeal in some situations
24:58
Speaker 3: to Trump to.
24:59
Speaker 1: Give him a part.
25:00
Speaker 3: Then Matt Argyll, a businessman from Florida, and Brock Pierce,
25:04
Speaker 3: who is also a pretty well known figure in the cryptosphere,
25:08
Speaker 3: knew about this and approached him and offered to lobby.
25:11
Speaker 1: For his cause.
25:13
Speaker 3: So Matt Argall in particular was pretty key in a
25:17
Speaker 3: number of these conversations that took place earlier this year,
25:20
Speaker 3: and offered to assemble a group of Washington insiders who
25:23
Speaker 3: could Take's best case to the White House and try
25:28
Speaker 3: and get him a pardon.
25:29
Speaker 2: Was there a fee or any kind of monetary compensation.
25:34
Speaker 1: Yeah.
25:34
Speaker 3: While a number of these pardon plans have been popping
25:38
Speaker 3: up over the past few months, this one stuck out
25:41
Speaker 3: because of the fee that was attached to it. The
25:44
Speaker 3: conversations were about Roger handing over thirty million dollars to
25:49
Speaker 3: these people to try and get him a pardon, which
25:51
Speaker 3: is astronomical. You know, I've reported on a number of
25:55
Speaker 3: these different proposals and fees flying around to lawyers and
25:59
Speaker 3: consulting and some lobbyists, but thirty million dollars is certainly
26:02
Speaker 3: the highest amount i'd heard.
26:04
Speaker 2: What kind of fees do you normally hear about?
26:06
Speaker 1: It differs across the board.
26:08
Speaker 3: I have heard that some lawyers have been quoting a
26:12
Speaker 3: million dollars as a base level to prepare an application
26:16
Speaker 3: and to speak to the right people in Washington to
26:19
Speaker 3: try and get their client's case heard. But then someone
26:22
Speaker 3: suggested there was a finder's fee, So someone quoting five
26:26
Speaker 3: thousand dollars to put someone in touch with someone else
26:29
Speaker 3: for other people. Lawyers in particular have quoted tens of
26:33
Speaker 3: thousands of dollars to put the paperwork together. So it
26:36
Speaker 3: really varies. But this is a real evolution of this
26:39
Speaker 3: clemency space.
26:41
Speaker 2: Years ago, it was mostly you know, regular lawyers or
26:44
Speaker 2: lawyers experience in this drawing up the paperwork. And so
26:48
Speaker 2: if it wasn't these huge.
26:49
Speaker 3: Fees, absolutely, I think the clemency space historically has largely
26:53
Speaker 3: been populated by pro bono advocates, so lawyers and academics
26:58
Speaker 3: offering to lobby for people who have been in prison
27:04
Speaker 3: for a very long time or particularly harsh sentences, maybe
27:08
Speaker 3: during the cocaine epidemic. But only now we're really starting
27:13
Speaker 3: to see these massive fees attached to this kind of work.
27:17
Speaker 2: And why is Roger Vert called bitcoin Jesus.
27:21
Speaker 3: Roger is called bitcoin Jesus because he was one of
27:24
Speaker 3: the early investors in the cryptocurrency and kind of had
27:29
Speaker 3: a bit of a godfather like role in those early years.
27:34
Speaker 2: So he got their pitch and what happened after that.
27:37
Speaker 3: Yes, there were a number of conversations held earlier this
27:41
Speaker 3: year between Roger VERRT and Matt Argyll, Rock Pierce, and
27:45
Speaker 3: some other characters who are quite well known in conservative
27:48
Speaker 3: circles and have very good track records at helping people
27:52
Speaker 3: get clemency. So those conversations went into what a path
27:57
Speaker 3: to a White House pardon might look like, and also
28:01
Speaker 3: reiterated this thirty million dollar fee structure again and again.
28:04
Speaker 1: But those conversations seem to have fizzled out.
28:07
Speaker 3: In March, I got my hands on an email that
28:10
Speaker 3: showed that the had just stopped replying to text messages
28:15
Speaker 3: and calls and voice notes from some of the people
28:17
Speaker 3: that were involved in these pardon conversations.
28:20
Speaker 2: Did Pierce and Argyll actually have connections to Trump world?
28:25
Speaker 3: It's unclear. That was one of the challenging parts of
28:29
Speaker 3: this exercise. There were certainly the names of senior White
28:33
Speaker 3: House officials thrown around in some of these conversations in
28:37
Speaker 3: the context of so and so knows this person at
28:41
Speaker 3: the White House. So and so as best friends with
28:43
Speaker 3: this person, But it's unclear whether anyone who was involved
28:47
Speaker 3: in those discussions actually had those legitimate connections, let alone
28:51
Speaker 3: the leverage to try and put this case in front
28:54
Speaker 3: of someone that had decision making capabilities.
28:57
Speaker 2: And the White House has responded in what were The White.
29:00
Speaker 1: House pushed back very strongly.
29:02
Speaker 3: They denied any knowledge of this pardon plan, any knowledge
29:07
Speaker 3: of the conversations. They weren't very happy with the suggestion
29:12
Speaker 3: that the names of senior White House officials were being
29:15
Speaker 3: thrown around. The official statement we got from a White
29:18
Speaker 3: House spokesperson referred to grifters quote unquote using the names
29:25
Speaker 3: to drum up pardon business, and the White House completely
29:27
Speaker 3: distanced themselves from whatever was going on here.
29:30
Speaker 2: Did any money actually change hands?
29:32
Speaker 1: No money changed hands?
29:33
Speaker 2: And Argle, you spoke to him, I mean, what do
29:36
Speaker 2: you say about this?
29:37
Speaker 1: I did.
29:37
Speaker 3: I spoke to a number of people as part of
29:40
Speaker 3: this reporting, including Matt Argyll, and I found him to
29:44
Speaker 3: be quite upfront and forthcoming about his role in these
29:48
Speaker 3: conversations and how it all came together. He told me
29:51
Speaker 3: that he genuinely thought Roger Vert was interested in engaging
29:56
Speaker 3: him to lobby for his cause. He claimed that he
29:58
Speaker 3: had traveled to Washington, He's mainly based in Miami on
30:02
Speaker 3: a number of occasions to kind of lay the groundwork,
30:05
Speaker 3: and you know, he introduced a well known Washington lawyer
30:09
Speaker 3: to Roger Ver to discuss a potential pardon plan. And
30:12
Speaker 3: I asked him about the thirty million dollar fee because
30:15
Speaker 3: it was such a large amount. And the way that
30:17
Speaker 3: he said that he and Brock had come up with
30:20
Speaker 3: that fee was they estimated Roger Ver was worth ten
30:24
Speaker 3: to twenty billion. That's not an amount that we've been
30:27
Speaker 3: able to confirm. But in Matt's justification, twenty million dollars
30:31
Speaker 3: seemed like a drop in the ocean for someone like that,
30:34
Speaker 3: especially when your freedom's on the line.
30:35
Speaker 2: But he also said, this wasn't about me trying to
30:38
Speaker 2: make dough if I made this happen, since my guys
30:41
Speaker 2: came through hook me up after.
30:43
Speaker 3: Yes, my Argyll explained how they came up with the
30:47
Speaker 3: thirty million dollar figure, but he also said the arrangement
30:52
Speaker 3: was quite fluid as to what they were going to
30:54
Speaker 3: do with that money. At the end, he said, you know,
30:57
Speaker 3: maybe Roger could invest in a crypto projective his or
31:01
Speaker 3: maybe at the end of the day he'd just end
31:03
Speaker 3: up with good karma.
31:05
Speaker 2: Ah, a lot of good karra. Maybe thirty million came through.
31:08
Speaker 2: So now what about Vera's case? Where does it stand?
31:11
Speaker 3: Rogerver seems to have called on his calls for a
31:15
Speaker 3: presidential pardon in recent months. He is still in Spain,
31:19
Speaker 3: where he was first arrested, and he's fighting extradition from
31:22
Speaker 3: there back to the United States. His lawyers have asked
31:26
Speaker 3: a judge to dismiss the indictment against him, arguing that
31:30
Speaker 3: he was following the advice of an accountant and a
31:34
Speaker 3: tax lawyer when he decided to renounce his US citizenship
31:38
Speaker 3: and moved.
31:39
Speaker 1: To sent Kids in twenty fourteen.
31:41
Speaker 2: And what are the charges against him exactly?
31:43
Speaker 3: Rogerver is facing charges for tax evasion. The IRS said
31:48
Speaker 3: that he hid the gains from the sale of hundreds
31:52
Speaker 3: of millions of dollars worth of bitcoin.
31:54
Speaker 2: And what's the business background of the two men who
31:57
Speaker 2: hatched this plan?
31:59
Speaker 3: So, Matt argu and brock Piers are both good friends
32:03
Speaker 3: but involved in their own business interests. Brock Piers is
32:07
Speaker 3: one of the co founders of the crypto firm Teather
32:11
Speaker 3: Fun Fact. He was also a child actor in the
32:14
Speaker 3: Disney movie The Marty Ducks. Now he is the chairman
32:18
Speaker 3: of the Bitcoin Foundation. Matt argyll Is He tells people
32:24
Speaker 3: that he helps companies secure lucrative government contracts. He's also
32:28
Speaker 3: run a number of call centers in Miami before, so
32:31
Speaker 3: he's been involved in a lot of different things.
32:33
Speaker 2: And Eva, did they work alone? Was anyone else involved?
32:38
Speaker 3: Matt Argyll was certainly the lead in a lot of
32:41
Speaker 3: these conversations earlier this year, and Brock Pierce was involved
32:45
Speaker 3: as well, giving he knew Roger vir from their early
32:48
Speaker 3: days as crypto investors. But at various points in these
32:52
Speaker 3: communications you can see that other people who work in
32:56
Speaker 3: the clevency space, lawyers and lobbyists, were also involved in
33:00
Speaker 3: and hatching a bit of a plan for Roldja to
33:02
Speaker 3: secure presidential pardon.
33:04
Speaker 2: Well, it's a fascinating story, Ava, and I guess more
33:07
Speaker 2: to come on what's now a clemency business. Thanks so much.
33:12
Speaker 2: That's Ava, Benny Morrison, Bloomberg Legal Reporter, And that's it
33:16
Speaker 2: for this edition of The Bloomberg Law Show. Remember you
33:19
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33:22
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