Latest / Bloomberg Law / Weekend Law: Trump Sues, Ticketmaster Defense & Plea Bargaining

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Weekend Law: Trump Sues, Ticketmaster Defense & Plea Bargaining · Bloomberg Law

0:03
Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio.
0:15
Speaker 2: So it is because of missus Wilson and so many
0:18
Speaker 2: teachers like her, that I stand before you as Vice
0:21
Speaker 2: President of the United States of America and that I
0:28
Speaker 2: am running to become president of the United States of America.
0:32
Speaker 3: It all happened rather quickly. After President Joe Biden ended
0:36
Speaker 3: his reelection bid on Sunday. Vice President Kamala Harris sealed
0:40
Speaker 3: her status as the presumptive Democratic presidential nominee. By Monday night,
0:45
Speaker 3: after getting more than enough pledged delegates to cinch the nomination.
0:50
Speaker 3: The Vice president took over Biden's campaign, which was renamed
0:54
Speaker 3: Harris for President, and his campaign war chest of about
0:57
Speaker 3: ninety six million dollars. Just as quickly, Republicans started a
1:02
Speaker 3: multi pronged effort to steymy Harris. On Tuesday, Donald Trump's
1:06
Speaker 3: presidential campaign filed a complaint with the Federal Election Commission,
1:10
Speaker 3: claiming that the transfer of Biden's money to Harris violates
1:14
Speaker 3: the law, and some Republicans, like House Speaker Mike Johnson,
1:18
Speaker 3: began raising the specter of lawsuits challenging Harris's place on
1:23
Speaker 3: the top of the ticket.
1:24
Speaker 4: We have fifty different systems in each of the states
1:27
Speaker 4: when it comes to presidential elections and choosing electors and
1:30
Speaker 4: all the rest. And in some of the states there
1:32
Speaker 4: are impediments to just switching someone out like that. Remember
1:35
Speaker 4: that this claims to be the Party of Democracy, small
1:38
Speaker 4: D democracy right. Fourteen million people went through the process
1:42
Speaker 4: and chose this nominee, Joe Biden. Now a handful of
1:45
Speaker 4: people have gotten together and decided he's no longer suitable.
1:48
Speaker 4: That's not how this system works.
1:50
Speaker 3: Or is it just that Johnson doesn't understand how the
1:52
Speaker 3: system works? Joining me is elections law expert Richard Brefald,
1:56
Speaker 3: a professor at Columbia Law School. Rich start where it
2:00
Speaker 3: always starts, the money. Does Harris have the right to
2:03
Speaker 3: take over the money raised by Biden's reelection campaign?
2:08
Speaker 5: So the money is sort of in three parts, And
2:10
Speaker 5: the only real issue was the money technically that went
2:13
Speaker 5: to the Biden Harris campaign. So the money that goes
2:16
Speaker 5: to the Democratic Party, of course she can use. And
2:18
Speaker 5: I think they also had a pack going, a superpack going,
2:21
Speaker 5: and of that, of course they can use. The issue
2:23
Speaker 5: was the money that went to Biden Harris specifically, and
2:27
Speaker 5: there I think it's a smaller amount, maybe like ninety million,
2:30
Speaker 5: but I'm not sure about that. The assumption of all
2:32
Speaker 5: the campaigns finance people I've spoken to is yes, as
2:35
Speaker 5: long as Harris continues to be on the ticket, it's
2:38
Speaker 5: money that she can use. The issue would have been
2:40
Speaker 5: more if the Democrats nominated someone else, then I think
2:44
Speaker 5: the Biden Harris committee would have had to transfer the
2:46
Speaker 5: money to the Democratic Party, and the Democratic Party would
2:50
Speaker 5: have the money. But as long as she's the nominee,
2:52
Speaker 5: she is part of Biden Harris, which I think now
2:55
Speaker 5: has already been renamed Harris. So the assumption of just
2:57
Speaker 5: about every campaign finance lawyer I know is that, yes,
3:01
Speaker 5: she can use it. I think the overwhelming assumption is
3:04
Speaker 5: that the money went to her also it was going
3:07
Speaker 5: to Biden and Harris. Harris is still running, so I
3:10
Speaker 5: think that the vast majority of Camping c and An's
3:13
Speaker 5: lawyers and scholars believe that it's money she can use.
3:17
Speaker 3: Trump's presidential campaign filed a complaint with the Federal Election Commission.
3:22
Speaker 3: It seems like a long shot, though for a couple
3:25
Speaker 3: of reasons. Harris has sixty days to respond, and the
3:30
Speaker 3: Federal Election Commission is known for moving at a glacial pace,
3:35
Speaker 3: so at the worst it would just be a question
3:37
Speaker 3: of paying fines later.
3:39
Speaker 5: Not only it takes a long to move, but you
3:41
Speaker 5: would need to get four votes, and there are three
3:44
Speaker 5: Democrats who sit on the Commission. There's a six member
3:46
Speaker 5: commission of three Democrats and the Republicans, and on most
3:51
Speaker 5: major things they tend to vote on party mind, So
3:54
Speaker 5: it just seems right. There's both the time that would
3:55
Speaker 5: take and likely vote, and I think given the rules
3:59
Speaker 5: of the election law, I think it will be very
4:01
Speaker 5: hard for Republicans to side step the Commission and go
4:04
Speaker 5: directly to court. Now somebody might try that, but I
4:07
Speaker 5: do think it's kind of a lost cause. Given the
4:10
Speaker 5: court system today. You never know one hundred percent, But
4:13
Speaker 5: I think, as I said, the overwhelming belief is that
4:15
Speaker 5: the money she could use and would be very unlikely
4:18
Speaker 5: the Federal Election Commission would certainly during the course of
4:21
Speaker 5: the campaign, but at any time come and say it
4:23
Speaker 5: wasn't improper use.
4:24
Speaker 3: Speaker Mike Johnson says he expects they'll be litigation, saying
4:29
Speaker 3: there are fifty different systems and that in some states
4:32
Speaker 3: there are impediments to swapping candidates. Could there be losses
4:36
Speaker 3: on the basis of the switch.
4:38
Speaker 5: It seems like a totally ridiculous argument. The party doesn't
4:41
Speaker 5: have a candidate. The party doesn't have a candidate until
4:43
Speaker 5: they make a nomination. Biden was never nominated. If Democratic
4:46
Speaker 5: convention has not met, even the so called virtual role
4:49
Speaker 5: call we're talking about hasn't happened, the Democratic Party gets
4:53
Speaker 5: to decide who the Democratic Party's nominee is, and they
4:56
Speaker 5: haven't made a choice yet. I don't think there'd be
4:59
Speaker 5: an issue even that's what was answered the nomination, because
5:02
Speaker 5: they still get to write their own rules. Just to
5:04
Speaker 5: make it clear, Biden was never the nominee. He was
5:07
Speaker 5: the presumptive nominee. He was never the nominee, and so
5:12
Speaker 5: there's no challenge to make. There's no substitution, No ballots
5:16
Speaker 5: have been printed, and so it's it's totally blowing smoke.
5:21
Speaker 3: So then what about the June twenty first memo from
5:24
Speaker 3: the Heritage Foundation, the conservative think tank, where it says
5:28
Speaker 3: it views swing states Georgia, Nevada, and Wisconsin as likely
5:32
Speaker 3: arenas for pre election legal challenges because they have specific
5:36
Speaker 3: procedures for withdrawal of a presidential nominee.
5:40
Speaker 5: The only way there would be anything is that Biden
5:42
Speaker 5: had actually been nominated. But Biden wasn't nominated. It doesn't
5:46
Speaker 5: matter that Biden won primary there because many times a
5:49
Speaker 5: candidate who's won primary insup states who's is the nomination.
5:53
Speaker 5: So the fact that Harris didn't win the primary in
5:55
Speaker 5: the NY of the states is irrelevant. Many candidate who
5:58
Speaker 5: are an ultimate nominees lost some primaries, they still got
6:02
Speaker 5: to be on the ballots of the states where they
6:04
Speaker 5: lost the primary. So I think they might have some
6:07
Speaker 5: argument that he'd actually been nominated and she was being
6:09
Speaker 5: put in to replace him, but he was never nominated.
6:13
Speaker 3: Which do you see any other legal complications of her candidacy.
6:17
Speaker 5: No, I don't. I don't. I mean, I think again,
6:20
Speaker 5: there's a potential potential challenge on the money when it
6:23
Speaker 5: goes from Biden Harris to Harris somebody else. But I
6:27
Speaker 5: do think there it's still Harris. I think that challenge
6:30
Speaker 5: is pretty weak. There's absolutely no challenge on her being
6:34
Speaker 5: on the ballot because you say, one more time, Biden
6:37
Speaker 5: was never the nominee, so there's no issue about changing nominees.
6:42
Speaker 5: He hadn't been nominated yet and you know, it was
6:45
Speaker 5: not likely that he would have been defeated at the convention.
6:48
Speaker 5: But there had been contested conventions. I mean, maybe the
6:50
Speaker 5: less truly congested one was in nineteen seventy six when
6:54
Speaker 5: Ronald Reagan was trying to unseat Gerald Ford. He came close,
6:58
Speaker 5: and if he had done that, he would have been
7:00
Speaker 5: the nominee. And the fact that forward with the incumbent
7:03
Speaker 5: president and had one a bunch of states and primaries
7:05
Speaker 5: would have been irrelevant.
7:06
Speaker 3: So do you have any idea what Mike Johnson is
7:08
Speaker 3: talking about? Then?
7:10
Speaker 5: I have no idea what he's talking about. I mean,
7:11
Speaker 5: I mean, some of the noise he's making is that
7:13
Speaker 5: it's undemocratic, small d democratic. But the parties get to
7:16
Speaker 5: write their own rules about who the nominees are. Supreme
7:19
Speaker 5: Court has said that, going back to contested conventions in
7:22
Speaker 5: the nineteen seventies, This is the parties are private organizations.
7:26
Speaker 5: They get to write their own rules and to choose
7:28
Speaker 5: their own nominees. And it looks like they're going to
7:30
Speaker 5: choose to nominate Harris. If they do nominate Harris, she's
7:34
Speaker 5: the nominee. She's the one who gets on the ballot.
7:36
Speaker 5: And if for some reason, they choose to nominate somebody
7:39
Speaker 5: else because something else happened in the next three weeks,
7:41
Speaker 5: that person would be the nominee.
7:43
Speaker 3: And what do you think about Johnson's argument that this
7:45
Speaker 3: violates democratic principles that voters chose Biden in the primaries
7:50
Speaker 3: and now they're getting Harris.
7:52
Speaker 4: There's a reason it's unprecedented. You don't just, you know,
7:54
Speaker 4: steamroll the rules in the process because you decide that
7:58
Speaker 4: your candidate is no longer suitable.
8:00
Speaker 5: I mean, I think, for one thing, Biden was always
8:02
Speaker 5: running with Harris as his teammate, so to some extent,
8:05
Speaker 5: they're still getting one of their choices. But I think
8:08
Speaker 5: in the end, remember, the winner of the primary in
8:11
Speaker 5: any one state is not guaranteed or in many states.
8:14
Speaker 5: I mean, going back to nineteen sixty eight, Hubert Humphrey
8:17
Speaker 5: didn't run any primaries and he was the nominee. Eugene
8:20
Speaker 5: McCarthy won more primaries than Hubert Humphrey, but Hubert Humphrey
8:23
Speaker 5: was the nominee.
8:25
Speaker 3: Everyone agrees on one thing, this is unprecedented. But is
8:29
Speaker 3: there anything in presidential history that would be analogous.
8:33
Speaker 5: It's hard to make an analogy where there was somebody
8:35
Speaker 5: who was so clearly the presumptive nominee and then who
8:40
Speaker 5: pulls out at the last minute. There have been a
8:42
Speaker 5: couple of elections where a candidate dies that the person's
8:46
Speaker 5: already been nominated, and then there's a scrambled to place
8:48
Speaker 5: that candidate. That has happened, But I can't recall anything
8:52
Speaker 5: like this where there was somebody who had won all
8:55
Speaker 5: the primaries, was the presumptive nominee and then decides no,
8:58
Speaker 5: I'm not going to run, and the party quickly rallies
9:02
Speaker 5: around another person. But again, this is the person who
9:06
Speaker 5: was his number two. It's not a challenger who is
9:08
Speaker 5: going to be chosen. So it is unprecedented, but it's utterly,
9:13
Speaker 5: entirely consistent with the rules. Maybe just leave it at that.
9:17
Speaker 5: Is that again, just to make it clear, he was
9:20
Speaker 5: never the nominee, So they're not replacing a nominee. They're
9:23
Speaker 5: just picking a nominee. And when people were donating money,
9:26
Speaker 5: they were donating money to Biden Harris. It looks like they're.
9:29
Speaker 3: Still going to get Harris, which delegates are planning a
9:33
Speaker 3: virtual roll call vote within the next two weeks to
9:36
Speaker 3: confirm Harris as their nominee. For president. Just suppose that
9:40
Speaker 3: doesn't happen for some reason.
9:42
Speaker 5: The way delegates work in the Democratic Party, even if
9:45
Speaker 5: Biden were running, the nature of the pledge is it's
9:48
Speaker 5: like an honor pledge or a good faith pledge. So
9:50
Speaker 5: even the pledge, delegates actually could have voted for someone else.
9:54
Speaker 5: So the fact that they've kind of announced a commitment
9:56
Speaker 5: to her, they're not legally pledged to her, so people
10:00
Speaker 5: could change their minds. I mean, I'm not saying that's
10:02
Speaker 5: going to happen, but I think the real issue is
10:05
Speaker 5: I think I saw Mary and Williamson I might have declared.
10:08
Speaker 5: I think under the rules of the Democratic Party, anyone
10:10
Speaker 5: who wants to be nominated would need to support of
10:13
Speaker 5: three hundred delegates, with no more than fifty from one state.
10:16
Speaker 5: And at this point it doesn't seem like there'll be
10:18
Speaker 5: any other candidate, so I think in that sense, she
10:21
Speaker 5: has it wrapped up. None of the other prominent figures
10:23
Speaker 5: in Democratic parties have indicated any interest in running. I
10:26
Speaker 5: think at this point they've all endorsed her, so in
10:28
Speaker 5: some sense it's technically open. But she's going to be nominated, presumably,
10:33
Speaker 5: if not by acclamation then by some overwhelming quote, and.
10:37
Speaker 3: I guess the only mystery left is who she'll choose
10:40
Speaker 3: as vice president. Thanks so much, rich for clearing up
10:43
Speaker 3: the confusion and ending the speculation. That's Professor Richard Rfault
10:48
Speaker 3: of Columbia Law School coming up next on the Bloomberg
10:51
Speaker 3: Law Show. You may remember in late May when the
10:53
Speaker 3: Justice Department filed a major antitrust lawsuit to break up
10:58
Speaker 3: Live Nation and Ticketmaster. Well, we've just seen Live Nation's
11:02
Speaker 3: first response, and it's pretty underwhelming. I'm June Grosso and
11:06
Speaker 3: you're listening to Bloomberg.
11:09
Speaker 6: Ticketmaster can impose a seemingly endless list of fees on fans.
11:16
Speaker 6: Those include ticketing fees, service fees, convenience fees, platinum fees,
11:23
Speaker 6: price master fees, per order fees, handling fees, and payment
11:28
Speaker 6: processing fees.
11:30
Speaker 3: Anyone who's bought concert tickets on Ticketmaster can probably relate
11:34
Speaker 3: to Attorney General Merrick Garland's description of the seemingly non
11:38
Speaker 3: ending fees to purchase. Ticketmaster, the country's largest ticketing company,
11:43
Speaker 3: and its parent company, Live Nation, the country's largest concert promoter,
11:48
Speaker 3: have a long history of clashes with major artists, including
11:52
Speaker 3: the fiasco in twenty twenty two. When the website crashed
11:56
Speaker 3: during a pre sale for Taylor Swift Stadium tour, led
12:00
Speaker 3: to congressional hearings. Garland said it was time for fans
12:03
Speaker 3: and artists to stop paying the price for the monopoly,
12:07
Speaker 3: and so the Justice Department and more than two dozen
12:10
Speaker 3: states filed a sweeping anti trusts lawsuit in May to
12:14
Speaker 3: force the breakup of Live Nation and Ticketmaster.
12:17
Speaker 6: Live Nation suffocates its competition using a variety of tactics,
12:22
Speaker 6: from acquisitions of smaller regional promoters and venues to threats
12:27
Speaker 6: and retaliation to agreements with rivals designed to neutralize them.
12:32
Speaker 6: This has included acquiring or co opting key independent promoters.
12:38
Speaker 3: Live Nation denies its a monopoly, and its CFO, Joe Burke,
12:42
Speaker 3: told told the Senate Judiciary Committee last year that it
12:45
Speaker 3: was not responsible for high ticket prices.
12:48
Speaker 7: Pricing and distribution strategies are determined by the artists and
12:52
Speaker 7: their teams. Service fees, even if they're called ticketing fees,
12:56
Speaker 7: are retained mainly by the venues in their portion of
12:59
Speaker 7: the service fee. The Ticketmaster retains has been falling steadily
13:03
Speaker 7: over time.
13:04
Speaker 3: But Live Nation's first official response to the lawsuit, in
13:07
Speaker 3: a letter to the trial judge is really underwhelming according
13:11
Speaker 3: to anti trust experts, and one of those experts joins me. Now,
13:16
Speaker 3: Harry First, a professor at NYU Law School. Harry start
13:19
Speaker 3: by telling us about the Justice Department's anti trust case.
13:23
Speaker 8: Okay, so this is in some ways basically a suit
13:26
Speaker 8: to correct a bad mistake the Justice Department made in
13:29
Speaker 8: twenty ten. So it's taken them a while, but eventually
13:33
Speaker 8: anti trust enforcers are trying to get it right. So
13:36
Speaker 8: what happened was in two thousand and nine, Ticketmaster and
13:40
Speaker 8: Live Nation decided to merge, and the Justice Department looked
13:45
Speaker 8: at it. Ticketmaster, of course, sells ticketing services to major
13:49
Speaker 8: venues around the country what's now called primary ticketing services.
13:53
Speaker 8: The secondary markets weren't so developed then reselling and Live
13:57
Speaker 8: Nation was the biggest promoter at the time and it
14:01
Speaker 8: sort of entered the ticketing market. But basically this was
14:05
Speaker 8: what's referred to as a vertical merger, not really competitors
14:08
Speaker 8: or not much competitors yet. But at the time the
14:13
Speaker 8: Justice Department understood what was going on. So Live Nation,
14:17
Speaker 8: which was a big promoter and booker of venues, wanted
14:22
Speaker 8: to put its shows into venues that would use Ticketmaster ticketing.
14:28
Speaker 8: So the venues knew that if they wanted to get
14:32
Speaker 8: you a really good show, the best way to do
14:35
Speaker 8: it was to use Ticketmaster because they really needed Live
14:39
Speaker 8: Nations talents. So Live Nation, as a promoter of major tours,
14:45
Speaker 8: thought that this tie up would sort of help both businesses,
14:49
Speaker 8: as did Ticketmaster. It would give Ticketmaster and edge over
14:53
Speaker 8: competitors in the ticketing business, and it would increase Live
14:56
Speaker 8: Nations revenues because now they owned a ticket in company.
15:00
Speaker 8: So control the talent, control entry or choice of the venues,
15:05
Speaker 8: and you control ticketing. So at the time, the Justice
15:09
Speaker 8: Department knew this, there was testimony about this, and also
15:14
Speaker 8: Ticketmaster had, you know, in major venues, a major share
15:18
Speaker 8: of the market, maybe seventy or so percent, so they
15:21
Speaker 8: had a dominant or monopoly position at the time. But
15:24
Speaker 8: instead of saying you can't merge, they said, hey, go
15:29
Speaker 8: ahead and merge. We've got some conditions for you. First,
15:32
Speaker 8: help a company is trying to get into the ticketing
15:34
Speaker 8: business get into it through some software. Okay, that was
15:37
Speaker 8: one idea. The second thing is we'll tell Live Nations
15:40
Speaker 8: that they can't condition their talents, you know, with venues
15:45
Speaker 8: on using Ticketmaster. They can't make that a condition and
15:48
Speaker 8: they can't retaliate against the venue if that venue subsequently
15:53
Speaker 8: decides to use a ticketing company. So no conditioning, no retaliation. Fine.
15:58
Speaker 8: We think this is wonderful. Parties merge the new entrant.
16:02
Speaker 8: Turns out never does well, and almost from the beginning
16:05
Speaker 8: they violate the decree, And in fact, they don't have
16:09
Speaker 8: to actually violate it because every promoter, every venue owner
16:14
Speaker 8: knows what the deal is. You know, give Live Nation
16:17
Speaker 8: the ticketing revenue, more likely you're going to get the
16:20
Speaker 8: good tours into your venue, and there's a lot of
16:23
Speaker 8: competition for that. So this decree never worked. It didn't
16:27
Speaker 8: work because the parties violated. There were later proceedings because
16:32
Speaker 8: it looked like they were violating it, and then kame
16:34
Speaker 8: Taylor Swift.
16:36
Speaker 3: And then the hearings in the Senate. That was the push.
16:39
Speaker 3: Wasn't it for the Justice Department to actually sue?
16:42
Speaker 8: That finally pushed the Justice Department. This has been a
16:45
Speaker 8: pretty aggressive Justice Department on any trust to say, you know,
16:50
Speaker 8: just really, it's almost fifteen years. It just didn't work
16:54
Speaker 8: and it's time to do something about it. So the
16:57
Speaker 8: lawsuit we see now is the Justice Department saying Ticketmaster
17:02
Speaker 8: has a monopoly position in primary ticketing services, and it's
17:07
Speaker 8: solidified by being owned by Live Nation. We've got to
17:11
Speaker 8: stop it, declare them monopoly, and then break them up.
17:15
Speaker 3: So they're at the motion to dismiss stage, and the
17:18
Speaker 3: trial judge had asked Live Nation to identify issues it
17:23
Speaker 3: might move to dismiss. Live Nation offered its first official
17:27
Speaker 3: response to the suit in a letter to the judge,
17:30
Speaker 3: and its response was quite narrow, really just challenging one
17:35
Speaker 3: of the government's claims, the tying claim. What did you
17:39
Speaker 3: think of Live Nation's response?
17:42
Speaker 8: Not much? I mean, okay, it involves a little more
17:48
Speaker 8: factual analysis of who's force to do was basically a
17:53
Speaker 8: compelled arrangement. So there is in the Justice Department's complaint
17:58
Speaker 8: not just a complaint about monopolization of the ticketing markets
18:02
Speaker 8: and large venues. There's a complaint about a tying arrangement
18:06
Speaker 8: that involves talent itself. So a tying arrangement is basically,
18:11
Speaker 8: you have two products. A seller says, if you want
18:14
Speaker 8: my A product, guess what you've got to take B.
18:17
Speaker 8: So you know, if you want my car, you got
18:19
Speaker 8: to take my tires. There's always a question of what
18:21
Speaker 8: two products are, but that's the basic of a tying arrangement,
18:25
Speaker 8: and the Justice Department alleges that Talent knows there's this
18:29
Speaker 8: talent promoting services market that Live Nation also is involved in.
18:35
Speaker 8: So if you want those promotion services, you've got to
18:38
Speaker 8: be sure to be booked into the proper venues that,
18:41
Speaker 8: of course are using Ticketmaster. This is part of the complaint,
18:45
Speaker 8: and it's a part that the defendant, Ticketmaster A Love
18:49
Speaker 8: of Nation, says it might move to dismiss, but frankly,
18:53
Speaker 8: it seems like a rather minor part of the complaint.
18:57
Speaker 8: The big part is their monopolization claim and the big
19:01
Speaker 8: relief is to break up the company. So time can
19:05
Speaker 8: be a problem, and it's historically been a problem, but
19:09
Speaker 8: it's not the central problem of this piece of litigation.
19:13
Speaker 8: So they haven't made their motion yet and it's a
19:16
Speaker 8: little I don't know what they're doing with this particular part.
19:20
Speaker 8: They are trying to move the case to a different court,
19:23
Speaker 8: so maybe they don't want to reveal their entire legal
19:27
Speaker 8: strategy at the moment, I really don't know, but they're
19:30
Speaker 8: trying to change where the case is going to be
19:33
Speaker 8: tried from New York to DC.
19:35
Speaker 3: Yeah, and why do they want to change venues? Do
19:38
Speaker 3: they think they'll have more luck in DC than in
19:40
Speaker 3: New York?
19:41
Speaker 8: I knew you were going to ask me that.
19:43
Speaker 3: I guess I'm too predictable.
19:45
Speaker 8: And I'm not really sure why they want to do that.
19:48
Speaker 8: Flow things down. Maybe they're dissatisfied with this particular judge.
19:53
Speaker 8: They know who they've got here. Maybe the docket is
19:56
Speaker 8: slower in DC, They've got a lot of cases there.
20:00
Speaker 8: Part of it may be related to their effort to
20:02
Speaker 8: dismiss the state claims. So the states are asking for damages,
20:07
Speaker 8: not clear which states, but under their state law. And
20:11
Speaker 8: there's now precedent in the DC Circuit which takes a
20:14
Speaker 8: somewhat dim view of these kinds of state claims in
20:19
Speaker 8: any trust cases, a case that involved the Facebook litigation
20:23
Speaker 8: in the District of Columbia. So maybe they feel they
20:27
Speaker 8: have a better chance of getting those state claims dismiss there.
20:30
Speaker 8: And the state claims also come with a request for
20:33
Speaker 8: a jury trial. So hard for me to know exactly strategically,
20:38
Speaker 8: you know what all is going on, And I mean,
20:41
Speaker 8: obviously people don't ask for change of venue unless they
20:44
Speaker 8: think they'll be better off someplace else. But I'm not
20:46
Speaker 8: quite sure why they.
20:48
Speaker 3: Think that, And so in this letter to the judge
20:51
Speaker 3: they try to knock out the state claims in different ways.
20:56
Speaker 3: Are they trying to avoid a jury trial in a
20:59
Speaker 3: case like this where I mean, who hasn't been aggrieved
21:03
Speaker 3: by ticket Master?
21:05
Speaker 8: You mean you think the jury might not be too sympathetic.
21:08
Speaker 3: That's what I'm thinking, but everyone hates.
21:11
Speaker 8: Yeah, that's a good instinct. I think on this they
21:14
Speaker 8: really would not want to have to present this case
21:16
Speaker 8: to a jury. And the claim for damages seems it's
21:20
Speaker 8: a little vague, which the defendant does say, and I
21:24
Speaker 8: think correctly, you know, not that he can't be made
21:27
Speaker 8: less vague. But if there's not a claim for damages,
21:30
Speaker 8: then the case gets tried before a judge, and you
21:33
Speaker 8: just hope, I guess that the judges never bought a ticket. Now,
21:37
Speaker 8: if it doesn't get moved them, they're going to make
21:39
Speaker 8: the same claims in New York. And you know they've
21:42
Speaker 8: already cited the DC circuit case. But you know it's
21:46
Speaker 8: stronger if it's in a circuit in which you're litigating,
21:49
Speaker 8: not in a sister circuit.
21:51
Speaker 3: As you mentioned, DOJ wants a breakup of the company,
21:54
Speaker 3: which is a drastic remedy. But I've heard it said
21:56
Speaker 3: that if it applies anywhere, it should be here.
22:00
Speaker 8: Yeah, I mean, in many ways this is I mean,
22:02
Speaker 8: I don't know for sure because they don't know the
22:04
Speaker 8: inner workings of how integrated the firms are. But this
22:07
Speaker 8: should be a case where it's relatively easy, relatively being
22:12
Speaker 8: the keyword to break the company up because they do
22:16
Speaker 8: operate as at least public Facing has two separate companies.
22:20
Speaker 8: They do two separate things. They're in separate markets that
22:23
Speaker 8: are linked, but they used to operate separately before and
22:27
Speaker 8: presumably could operate separately again. So I think you're right.
22:32
Speaker 8: This is a case where, you know, restructuring of the
22:34
Speaker 8: company sounds like it is doable. The question is whether
22:38
Speaker 8: that's going to change Ticketmaster's monopoly position or not, And
22:43
Speaker 8: that's sort of the next step. So you could break
22:45
Speaker 8: them up, but you know, how much will that increase
22:48
Speaker 8: competition in itself?
22:50
Speaker 3: Can live Nation use the fact that DOJ allowed the
22:54
Speaker 3: merger to proceed in the first place, and then agreed
22:58
Speaker 3: to extend the initial consent decree as recently as twenty nineteen,
23:02
Speaker 3: even after it found that live Nation repeatedly violated the decree.
23:07
Speaker 8: They will make that argument. Is it a good legal argument?
23:11
Speaker 8: I really don't think so. There is not what's called
23:13
Speaker 8: in a stoppel against the government. The government is able
23:17
Speaker 8: to and free to change its policy as it sees
23:22
Speaker 8: how it works. There are older cases in which the
23:24
Speaker 8: government accepted this particular remedy. The remedy didn't work out.
23:29
Speaker 8: The district court judge in fact in that older case said, gee,
23:32
Speaker 8: I can't change this decree. You entered it, and the
23:34
Speaker 8: Supreme Court said, no, you can. It didn't work. Ten
23:37
Speaker 8: years you had a chance for this to work and
23:40
Speaker 8: it didn't bring competition. Ten years is long enough. So
23:43
Speaker 8: I don't think in the end that's really a good argument.
23:46
Speaker 8: You know, things change and decrees don't work out, and
23:50
Speaker 8: they don't bind successive governments forever.
23:53
Speaker 3: Always great to get your insights, Harry, Thanks so much.
23:56
Speaker 3: That's Professor Harry First of NYU Law School. Coming up next.
24:00
Speaker 3: Defense attorneys beware of those plea bargaining sessions. I'm June Grass.
24:04
Speaker 3: When you're listening to Bloomberg, Plea bargains account for almost
24:08
Speaker 3: ninety eight percent of federal convictions. And we've all seen
24:12
Speaker 3: how it works, sort of in movies and TV shows
24:16
Speaker 3: like Presumed Innocent, where the defense attorney is trying to
24:19
Speaker 3: get his client a plea.
24:21
Speaker 9: Deal, blood and guts everywhere at her home, not so
24:24
Speaker 9: much as a microscopic drop in this car he cleaned
24:27
Speaker 9: it or on his clothing cleaned it also weapons disposed
24:30
Speaker 9: that it. Rusty cannot risk spending the rest of his
24:34
Speaker 9: natural life in prison, and you cannot chance an acquittal
24:37
Speaker 9: and the obliteration of all of your political capital. We'll
24:41
Speaker 9: cop to the obstruction three years.
24:47
Speaker 4: Ray, you seriously think we'll plead it out on an
24:50
Speaker 4: obstruction surn But what.
24:52
Speaker 3: If prosecutors use information they get from defense lawyers in
24:56
Speaker 3: those sessions against the defendant. That's basically what happened to
25:00
Speaker 3: Senator Bob Menandez in his corruption trial. While the gold bars,
25:04
Speaker 3: the half million in cash, and the Mercedes Benz got
25:07
Speaker 3: most of the attention, federal prosecutors made an unusual and
25:11
Speaker 3: aggressive move in charging Menendez with obstruction based on the
25:16
Speaker 3: presentation made by his former lawyer in a meeting with
25:19
Speaker 3: prosecutors before the indictment. Joining me is former federal prosecutor.
25:23
Speaker 3: Ariel Newman, a partner at Bird Marilla Ariel how common
25:27
Speaker 3: is it for defense attorneys to meet with prosecutors to
25:31
Speaker 3: try to talk them out of bringing charges.
25:33
Speaker 10: So in this case, we're talking about pre indictment, meaning
25:36
Speaker 10: before the defendant is charged, And these meetings are very,
25:40
Speaker 10: very common, especially in the white collar context where we're
25:43
Speaker 10: talking about fraud crimes of some sort. We are going
25:46
Speaker 10: in and making the case to the prosecutors about why
25:49
Speaker 10: they shouldn't pursue a case against our client. And it
25:53
Speaker 10: may be legal arguments, it may be factual arguments, but
25:56
Speaker 10: we are trying to convince them that they don't have
25:58
Speaker 10: a case, or for whatever reason, they shouldn't pursue a
26:01
Speaker 10: case that they think they have.
26:02
Speaker 3: Are these meetings supposed to be confidential or can prosecutors
26:07
Speaker 3: use the information given to them at trial?
26:10
Speaker 10: Usually there is an agreement or there's a request for
26:13
Speaker 10: an agreement by the defense lawyer that these are protected
26:16
Speaker 10: as settlement conversations. There's a sederal rule of evidence that
26:19
Speaker 10: says settlement communications can't be admitted for almost and that's
26:24
Speaker 10: an important almost almost any purpose at trial, and so
26:28
Speaker 10: generally the expectation is that these are going to be
26:31
Speaker 10: largely confidential. And then the caveat to that is sometimes there
26:35
Speaker 10: is an agent that's an FBI agent, who is taking
26:38
Speaker 10: notes during the meeting. If that's happening, you tend to
26:41
Speaker 10: know that it may not be as confidential as you hope. Also,
26:44
Speaker 10: I mean, I've had it where they write a report
26:46
Speaker 10: and then they produce it in discovery. If the government
26:48
Speaker 10: goes ahead and charges your clients anyway, and there's other
26:51
Speaker 10: people who are charged in the case along with your client,
26:54
Speaker 10: and suddenly they are seeing a report about what you
26:57
Speaker 10: said during that meeting where you were trying to convince
26:59
Speaker 10: the government not to charge your client.
27:01
Speaker 3: I mean, was that in a case where you thought
27:03
Speaker 3: what you were saying was not to be used.
27:06
Speaker 10: We thought it was a confidential settlement meeting. They never
27:10
Speaker 10: tried to introduce it at trial. But there isn't really
27:14
Speaker 10: anything prohibiting them from doing what they did unless you
27:16
Speaker 10: have an agreement explicitly that they won't. And I have
27:20
Speaker 10: found more and more as I have asked for those
27:22
Speaker 10: agreements that prosecutors and especially prosecutors from what we call
27:26
Speaker 10: main Justice DOJ and DC as opposed to the local
27:29
Speaker 10: US attorney's office are less and less willing to have
27:32
Speaker 10: any sort of agreement about what they're going to do
27:34
Speaker 10: with the information you provide. But what happened in the
27:36
Speaker 10: Menendez case, Honestly, I've never heard of that before, and
27:40
Speaker 10: everybody I've talked to has never heard of it before,
27:42
Speaker 10: where prosecutors in that case charged the defendant with obstruction
27:47
Speaker 10: because they claim the lawyers provided false factual information during
27:52
Speaker 10: those meetings, which they say the lawyers got from the defendant.
27:56
Speaker 10: You know, we are always talking about facts during the
27:59
Speaker 10: meeting legal arguments, but we're also making factual arguments. And
28:03
Speaker 10: I've never heard of and like I say, nobody else
28:05
Speaker 10: that I know I has ever heard of the government
28:07
Speaker 10: charging obstruction based on what you say during those meetings.
28:10
Speaker 3: And we should point out that the exception to the
28:12
Speaker 3: federal rule that you referred to before is that statements
28:16
Speaker 3: made during these negotiations can be used to prove obstruction,
28:21
Speaker 3: as in the Menendez case. So Abby Lowell, a high
28:24
Speaker 3: profile criminal defense attorney, represented Menendez in these pre indictment
28:29
Speaker 3: negotiations with the prosecutors in the Southern District, and he
28:33
Speaker 3: made a PowerPoint presentation. Is that unusual?
28:37
Speaker 10: Not at all, very common. That helps outline the discussion,
28:40
Speaker 10: helps frame what you're going to be talking about, and
28:43
Speaker 10: the hammer home the point that you want the government
28:45
Speaker 10: to focus on. So very very common to have a presentation,
28:49
Speaker 10: and I think important in any of these presentations that
28:53
Speaker 10: that's all what it is, maybe an outline or maybe
28:55
Speaker 10: just a couple of bullet points on a screen, maybe
28:58
Speaker 10: a couple pictures or citations to cases. None of us
29:01
Speaker 10: are putting the entire context of what we're going to
29:04
Speaker 10: say up on the screen. In fact, my practices edit
29:07
Speaker 10: it down to the fewest words possible.
29:09
Speaker 3: The judge allowed the government to introduce a trial pages
29:13
Speaker 3: from that PowerPoint presentation. I mean, what about attorney client privilege?
29:18
Speaker 3: What about attorney work product? Where were those concepts in this?
29:23
Speaker 10: So attorney client privilege once you share with the government,
29:27
Speaker 10: let's say what your client said, then it's free game.
29:30
Speaker 10: Right you've sort of waived at least as to those statements.
29:33
Speaker 10: Arguably the privilege depends how you say it, right, my
29:35
Speaker 10: client told me X that's pretty much a waiver. But
29:39
Speaker 10: the attorney work product is a different question. And generally
29:43
Speaker 10: my view is that we shouldn't be giving the government
29:46
Speaker 10: our work product defense lawyers. We shouldn't be giving them
29:48
Speaker 10: our powerpoints because they can, as it appears they did
29:51
Speaker 10: here take it out of context right here that I
29:53
Speaker 10: think they put in four pages from what was obviously
29:56
Speaker 10: a longer PowerPoint into evidence and the defense, if I
30:00
Speaker 10: understand it, was really stymied in their effort to get
30:03
Speaker 10: in any of the context around them. And it's that
30:05
Speaker 10: context where the caveats are given, where the lawyers are
30:08
Speaker 10: making sure that it's understood that this may not be
30:11
Speaker 10: exactly what the client, that maybe this is what our
30:14
Speaker 10: investigation has shown or something else. But without that context,
30:18
Speaker 10: it becomes very difficult to get the full picture of
30:21
Speaker 10: what was actually said during that meeting.
30:23
Speaker 3: In light of this, you have written for Bloomberg Law
30:26
Speaker 3: some advice for defense lawyers in these situations. First, whether
30:30
Speaker 3: to even have the meeting? I mean, how often our
30:33
Speaker 3: defense lawyers successful in getting prosecutors not to charge their client?
30:39
Speaker 3: Is it worth even having one of these meetings?
30:41
Speaker 10: I've done it, and you know people who have had success.
30:43
Speaker 10: It depends where the government is in the process and
30:47
Speaker 10: how could your facts and your arguments are It is
30:49
Speaker 10: certainly in many cases worth making the presentation. First, of all,
30:54
Speaker 10: often in advance of that, you have discussions with the
30:57
Speaker 10: government where you can learn more about their case and
31:00
Speaker 10: gives you a chance to find out sometimes where the
31:03
Speaker 10: holes are in your arguments as well. Right if I
31:05
Speaker 10: come in and I make some argument, the government says, oh,
31:08
Speaker 10: that's all well and good, but what about XYZ And
31:11
Speaker 10: for whatever reason I didn't know about X y Z. Well,
31:13
Speaker 10: now we're more informed going into the next decisions about
31:16
Speaker 10: what we're going to do. The big downside to making
31:20
Speaker 10: these presentations is that you're showing your cards to some extent.
31:23
Speaker 10: You're going in and you're making your pitch to the government.
31:26
Speaker 10: You're arguing your facts, you're arguing your evidence, and you know,
31:30
Speaker 10: the sort of conventional wisdom is that that allows the
31:33
Speaker 10: government to shore up their case as well. They find
31:35
Speaker 10: out where their potential holes are and where the weaknesses
31:38
Speaker 10: in their case are. And so it's certainly a balancing
31:40
Speaker 10: decision in every situation of whether you do this meeting,
31:44
Speaker 10: but in many cases it's worthwhile. And in many cases
31:48
Speaker 10: the client is really pushing because they're facing the prospect
31:51
Speaker 10: of federal felony charges and this may be the best
31:54
Speaker 10: shot they have to avoid them. Or at least they
31:56
Speaker 10: think that. And that's one of the things I talk
31:58
Speaker 10: about is how to resist that pressure. Whether to resist
32:00
Speaker 10: that pressure. It's not always so easy when the guy
32:03
Speaker 10: paying the bills is telling you do something to stop this. Please.
32:06
Speaker 3: Are there any magic words that you should say at
32:09
Speaker 3: the beginning or you should have put in writing so
32:12
Speaker 3: that you avoid a menenda situation?
32:16
Speaker 10: Well, there are no magic words, and so you just
32:18
Speaker 10: have to be careful and clear as you approach this.
32:22
Speaker 10: One of the main things is I do think it's
32:23
Speaker 10: worth getting an agreement that these are settlement communications and
32:27
Speaker 10: that at least gives some protection to how anything that
32:31
Speaker 10: comes out of the meeting might be used in the future.
32:33
Speaker 10: And a big one that I think we see here
32:36
Speaker 10: is where at all possible not to source the information
32:41
Speaker 10: that's in your presentation to your client, meaning not to
32:44
Speaker 10: say my client told me X or my client says
32:47
Speaker 10: why about this situation? And once you say that, you
32:50
Speaker 10: are then really putting the client on the line and
32:53
Speaker 10: their credibility on the line.
32:55
Speaker 3: So, in talking to other defense lawyers, do you think
32:58
Speaker 3: that they're more aware now or more afraid of what
33:02
Speaker 3: might happen in these meetings?
33:04
Speaker 10: I think this prosecution for people who are aware of it,
33:07
Speaker 10: sent a bit of a shockwave through the defense bar.
33:10
Speaker 10: I haven't had a reaction like I had to this
33:12
Speaker 10: article from the defense bar. People pointing out to me
33:16
Speaker 10: that they are changing their practices, people responding that they've
33:19
Speaker 10: never heard of this, and they're going to have to
33:21
Speaker 10: think about it going forward. You know, we're going to
33:23
Speaker 10: have to see whether this was an outlier, very aggressive prosecution,
33:28
Speaker 10: or whether this is something that is going to be
33:31
Speaker 10: a tool, a new tool in the government's told belt,
33:33
Speaker 10: and we're all going to have to be cognizant of it.
33:35
Speaker 10: So I do think it's going to change or at
33:38
Speaker 10: least make us more cautious as we go into these meetings.
33:41
Speaker 3: Menanda says he's going to appeal his conviction all the
33:43
Speaker 3: way to the Supreme Court if necessary. And we've seen
33:47
Speaker 3: the Supreme Court in the last decade or so narrowing
33:51
Speaker 3: the definition of corruption, leading to a number of convictions
33:55
Speaker 3: of public figures being overturned. Do you think that'll be
33:59
Speaker 3: one of his poor So, I'm.
34:01
Speaker 10: Sure it's something he'll bring up. I've had bribery cases,
34:04
Speaker 10: public corruption cases, and this is sort of where the
34:07
Speaker 10: rub is right now as the Supreme Course is going
34:09
Speaker 10: through and as you say, narrowing the definition of what
34:12
Speaker 10: we call an official act. I would be shocked if
34:15
Speaker 10: they don't focus on that. They were focused on it
34:17
Speaker 10: in the pre trial and then again during the trial,
34:19
Speaker 10: and it seems to me that they've got some good
34:21
Speaker 10: arguments and they've got some that may be more of
34:24
Speaker 10: a challenge. It's really about whether Menendez was using his
34:28
Speaker 10: official position on any decision or action on any question matter, cause, preceding,
34:34
Speaker 10: or controversy which may be pending before him in his
34:38
Speaker 10: official capacity. So, for instance, he as was alleged interfered
34:43
Speaker 10: with a state prosecution by calling up a state prosecutor
34:47
Speaker 10: and saying, hey, maybe take another look at this now,
34:49
Speaker 10: that's not really something that's pending before him, And maybe
34:53
Speaker 10: a harder argument that that's an official act. He doesn't
34:56
Speaker 10: really have an official role there. He's sort of using
34:58
Speaker 10: his influence and position. Whereas maybe as he's alleged to
35:02
Speaker 10: have interfered with the nomination of the US Attorney from
35:07
Speaker 10: New Jersey by essentially corruptly making a recommendation to the
35:11
Speaker 10: president of who to nominate, well, that may be closer
35:13
Speaker 10: to the line because that is the traditional function of
35:17
Speaker 10: the senator from a particular state, and that is potentially
35:20
Speaker 10: something that was pending before him in his official capacity.
35:23
Speaker 10: So it seems to me that they may have some luck,
35:25
Speaker 10: but I'd be surprised if they can fully get everything reversed.
35:28
Speaker 10: And that's just one part of the case. Obviously, there's
35:30
Speaker 10: other pieces that don't rely on that official Act element.
35:33
Speaker 10: Those are going to be harder for them to succeed on.
35:36
Speaker 3: From what I can see, do you think his conviction
35:38
Speaker 3: for being an agent of Egypt will be easier for
35:41
Speaker 3: the defense to attack?
35:42
Speaker 10: I think what you have to look at is the
35:44
Speaker 10: full picture, right, because the argument is essentially that legislators,
35:50
Speaker 10: and especially a senior senator like him, who's doing the
35:52
Speaker 10: foreign affairs work that he's doing, are going to have
35:55
Speaker 10: contact with foreign officials and are going to take positions
35:58
Speaker 10: that may be to the benefit of a particular country,
36:02
Speaker 10: in this case Egypt, And so that's just sort of
36:04
Speaker 10: part and parcel of what they do. And as a
36:06
Speaker 10: member of Congress, the challenge in a case like this is, well,
36:11
Speaker 10: what about the rest of the picture? Right? And here
36:14
Speaker 10: it's the cash and the gold bars and the deleted
36:16
Speaker 10: messages and so on and so forth that the jury
36:20
Speaker 10: obviously felt that takes it out of the realm of
36:22
Speaker 10: what you're doing in your official capacity and puts it
36:25
Speaker 10: more into the realm of something that is corrupt. And
36:28
Speaker 10: so that's what's going to be the bigger challenge I
36:30
Speaker 10: think on appeal is how do you question the jury's
36:32
Speaker 10: verdict in light of the full scope of the evidence.
36:35
Speaker 10: And that's always what makes these cases difficult.
36:38
Speaker 3: Menandez as lawyers say they're going to appeal aggressively, so
36:41
Speaker 3: we'll see what arguments they come up with. Thanks so much, Ariel.
36:44
Speaker 3: That's Ariel Newman of Bird Marilla. And that's it for
36:47
Speaker 3: this edition of the Bloomberg Law Podcast. Remember you can
36:51
Speaker 3: always get the latest legal news by subscribing and listening
36:54
Speaker 3: to the show on Apple Podcasts, Spotify, and at Bloomberg
36:57
Speaker 3: dot com, slash podcast, Slash Law. I'm June Grosso and
37:01
Speaker 3: this is Bloomberg