1 00:00:03,480 --> 00:00:07,560 Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every 2 00:00:07,640 --> 00:00:10,440 Speaker 1: day we bring you insight and analysis into the most 3 00:00:10,480 --> 00:00:13,399 Speaker 1: important legal news of the day. You can find more 4 00:00:13,480 --> 00:00:18,000 Speaker 1: episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud 5 00:00:18,320 --> 00:00:22,360 Speaker 1: and on Bloomberg dot com slash podcasts. Oh pairs have 6 00:00:22,480 --> 00:00:24,599 Speaker 1: been coming to this country for more than half a 7 00:00:24,680 --> 00:00:28,200 Speaker 1: century through a program overseen by the US State Department. 8 00:00:28,720 --> 00:00:31,960 Speaker 1: More than ninety old Pairs are using US courts to 9 00:00:32,120 --> 00:00:35,040 Speaker 1: challenge the Old Pair program in a type of legal 10 00:00:35,040 --> 00:00:38,280 Speaker 1: action that allows them to band together a class action. 11 00:00:38,680 --> 00:00:42,400 Speaker 1: They claim that fifteen private agencies engaged in a wage 12 00:00:42,400 --> 00:00:47,000 Speaker 1: fixing conspiracy, colluding to keep their compensation below the minimum wage, 13 00:00:47,400 --> 00:00:51,040 Speaker 1: and the old Pairs have cleared a hurdle, a Colorado 14 00:00:51,120 --> 00:00:55,080 Speaker 1: federal judge has certified the class allowing the lawsuit to proceed. 15 00:00:55,800 --> 00:00:59,840 Speaker 1: Joining me is Josh Idolson, Bloomberg Business Week reporter Josh 16 00:01:00,000 --> 00:01:02,920 Speaker 1: tell us about the program. Thanks for having me so. 17 00:01:02,960 --> 00:01:06,720 Speaker 1: This is a program under which young foreign workers under 18 00:01:08,000 --> 00:01:11,000 Speaker 1: come to the US. They provide live in child care. 19 00:01:11,520 --> 00:01:15,040 Speaker 1: They work on paper. It's supposed to be no more 20 00:01:15,120 --> 00:01:18,080 Speaker 1: than forty five hours a week. It is part of 21 00:01:18,120 --> 00:01:23,120 Speaker 1: the j one so called cultural exchange visa program overseen 22 00:01:23,200 --> 00:01:27,040 Speaker 1: by the State Department, And if you listen to the 23 00:01:27,120 --> 00:01:32,600 Speaker 1: sponsor agencies, these private companies that oversee the program as 24 00:01:32,640 --> 00:01:36,560 Speaker 1: certified by the State Department tell it. They would say, 25 00:01:36,600 --> 00:01:40,760 Speaker 1: this is not primarily a work program. It's a give 26 00:01:40,800 --> 00:01:44,080 Speaker 1: and take where someone welcomes the stranger into their home 27 00:01:44,200 --> 00:01:47,080 Speaker 1: and that stranger helps them with the kids and gets 28 00:01:47,080 --> 00:01:49,760 Speaker 1: treated as part of the family. So it's build as 29 00:01:49,800 --> 00:01:54,120 Speaker 1: a cultural exchange program, not a labor program. What do 30 00:01:54,200 --> 00:01:58,160 Speaker 1: these old pairs say about that billing versus reality? Well, 31 00:01:58,240 --> 00:02:01,760 Speaker 1: something I heard from multiple plaintiffs as well as attorneys 32 00:02:01,840 --> 00:02:05,240 Speaker 1: is this is something that's marketed to the o pairs 33 00:02:05,280 --> 00:02:09,600 Speaker 1: as the best year of your life and a cultural opportunity, 34 00:02:09,720 --> 00:02:13,040 Speaker 1: and marketed to the families who are hosting them as 35 00:02:13,680 --> 00:02:18,760 Speaker 1: cheap childcare and a chance to employ someone for a 36 00:02:18,800 --> 00:02:21,560 Speaker 1: lot less money than you would have to pay finding 37 00:02:21,600 --> 00:02:24,640 Speaker 1: someone some other way in the US. So the plaintiffs 38 00:02:24,680 --> 00:02:28,480 Speaker 1: are suing these fifteen private agencies that basically control the 39 00:02:28,520 --> 00:02:32,720 Speaker 1: old pair labor market tell us about their claims and 40 00:02:32,760 --> 00:02:36,160 Speaker 1: their use of the antitrust law. So they allege that 41 00:02:36,200 --> 00:02:40,000 Speaker 1: there is a wage fixing conspiracy where these agencies, who 42 00:02:40,080 --> 00:02:43,880 Speaker 1: win the lawsuit was filed, were the only agencies authorized 43 00:02:43,880 --> 00:02:49,400 Speaker 1: by the State Department to administer the program. Together set 44 00:02:49,520 --> 00:02:54,359 Speaker 1: over rate as what will be presented to the O 45 00:02:54,520 --> 00:02:57,720 Speaker 1: pairs as the most they can make, and presented to 46 00:02:57,760 --> 00:03:00,560 Speaker 1: the families is what all O pairs get paid aid, 47 00:03:00,880 --> 00:03:04,480 Speaker 1: And among the allegations are that OH pairs were falsely 48 00:03:04,560 --> 00:03:07,600 Speaker 1: told not just that this was the government's rate for 49 00:03:07,720 --> 00:03:11,200 Speaker 1: what they should be paid exactly, but that they could 50 00:03:11,200 --> 00:03:14,839 Speaker 1: be deported if they tried to get some other rate. 51 00:03:15,520 --> 00:03:19,840 Speaker 1: Among the evidence is allegedly conversations of an investigator had 52 00:03:19,880 --> 00:03:23,880 Speaker 1: with officials at the agencies in which they again allegedly 53 00:03:24,360 --> 00:03:28,760 Speaker 1: confirmed that there's an agreement among the agencies to get 54 00:03:28,800 --> 00:03:33,120 Speaker 1: everybody paying this rate. Now, the agencies say this is 55 00:03:33,120 --> 00:03:37,360 Speaker 1: a ridiculous allegation because it's really the government that said 56 00:03:37,520 --> 00:03:39,720 Speaker 1: this is the amount of pairs will get paid. A 57 00:03:39,720 --> 00:03:44,480 Speaker 1: magistrate judge, however, said that was a ridiculous claim to 58 00:03:44,520 --> 00:03:50,040 Speaker 1: make because the alleged government document really is just reminding 59 00:03:50,080 --> 00:03:54,360 Speaker 1: people of the floor on what's allowed under wage laws. 60 00:03:54,400 --> 00:03:58,960 Speaker 1: So this lawsuit is one of many controversies surrounding these 61 00:03:59,120 --> 00:04:02,160 Speaker 1: j vs, as which Donald Trump, when he was a candidate, 62 00:04:02,160 --> 00:04:06,520 Speaker 1: pledge to replace with an inner city youth jobs program. 63 00:04:06,880 --> 00:04:09,800 Speaker 1: Tell me about some of the other controversies. That's right. 64 00:04:09,840 --> 00:04:13,160 Speaker 1: We've seen over the past several years, strikes actually by 65 00:04:13,240 --> 00:04:18,679 Speaker 1: some j one Summer travel student work participants. We saw 66 00:04:18,920 --> 00:04:24,760 Speaker 1: one among people working at Hershey's in Pennsylvania. We saw 67 00:04:26,000 --> 00:04:29,640 Speaker 1: people working for a McDonald's franchise e go on strike, 68 00:04:29,920 --> 00:04:33,039 Speaker 1: alleging that they were being made to work more than 69 00:04:33,120 --> 00:04:38,120 Speaker 1: twenty hours consecutively and being charged exorbitant rates to live 70 00:04:38,160 --> 00:04:42,760 Speaker 1: in a basement controlled by the franchise e. So cultural exchange. 71 00:04:43,040 --> 00:04:45,040 Speaker 1: I talked to some of those strikers years ago, and 72 00:04:45,080 --> 00:04:48,240 Speaker 1: they said they did get a cultural exchange, coming together 73 00:04:48,279 --> 00:04:51,160 Speaker 1: with these other students from around the world and going 74 00:04:51,200 --> 00:04:54,520 Speaker 1: on strike and defying this company. But it was not 75 00:04:54,640 --> 00:04:59,000 Speaker 1: the cultural exchange that was advertised, certainly not. What is 76 00:04:59,040 --> 00:05:03,719 Speaker 1: the status of the j VS is well, there have 77 00:05:03,960 --> 00:05:07,320 Speaker 1: been rumors that there will be major changes to these 78 00:05:07,360 --> 00:05:10,719 Speaker 1: programs under President Trump. This is an area where you 79 00:05:10,839 --> 00:05:14,520 Speaker 1: have heard concerns from the left and from the right, 80 00:05:14,600 --> 00:05:20,040 Speaker 1: though certainly phrased somewhat differently. But we don't really know what, 81 00:05:20,279 --> 00:05:24,000 Speaker 1: if any change there will be to this program under 82 00:05:24,000 --> 00:05:28,400 Speaker 1: this administration, and the State Department did not wish to 83 00:05:28,600 --> 00:05:32,280 Speaker 1: speak at length about it. How big a hurdle was 84 00:05:32,360 --> 00:05:36,279 Speaker 1: it for the planeffs in this case the O pairs 85 00:05:36,400 --> 00:05:40,560 Speaker 1: to get class action certification. Well, class certification, as in 86 00:05:40,600 --> 00:05:44,039 Speaker 1: any case, is a very big deal. And prior to that, 87 00:05:44,120 --> 00:05:47,719 Speaker 1: the fact that this case survived motion to dismiss, and 88 00:05:47,800 --> 00:05:50,960 Speaker 1: that the magistrate judge and the federal judge, who largely 89 00:05:51,000 --> 00:05:57,080 Speaker 1: embraced the magistrate judges ruling, saw these as allegations that 90 00:05:57,160 --> 00:06:02,080 Speaker 1: should proceed, and in fact said that if what is 91 00:06:02,120 --> 00:06:06,080 Speaker 1: being alleged is true, there is what another judge has 92 00:06:06,120 --> 00:06:09,320 Speaker 1: referred to as the smoking gun in a price fixing case, 93 00:06:09,360 --> 00:06:14,760 Speaker 1: actual explicit conspiracy to set prices of people's labor. We 94 00:06:14,839 --> 00:06:19,159 Speaker 1: often think of antitrust as all about prices for consumers, 95 00:06:19,160 --> 00:06:24,120 Speaker 1: but it's equally about wages for workers. And what's the 96 00:06:24,200 --> 00:06:29,080 Speaker 1: likelihood now that there might be a settlement of this case, Well, 97 00:06:30,200 --> 00:06:32,560 Speaker 1: you know better than I do. At the point that 98 00:06:32,600 --> 00:06:37,599 Speaker 1: there's been a class action certification hurdle crossed. If you 99 00:06:37,720 --> 00:06:42,240 Speaker 1: are providing counsel as a defense attorney, that can change 100 00:06:42,240 --> 00:06:45,400 Speaker 1: your calculation. We are waiting for the end of the 101 00:06:45,440 --> 00:06:49,919 Speaker 1: week for the deadline for the defendants to formally announced 102 00:06:49,960 --> 00:06:54,840 Speaker 1: that they would seek federal Appeals Court consideration of that 103 00:06:55,560 --> 00:07:01,440 Speaker 1: motion on class certification. But I imagine there's some calculation 104 00:07:01,520 --> 00:07:04,040 Speaker 1: going on at the moment. Thanks Josh, it's it's really 105 00:07:04,040 --> 00:07:06,520 Speaker 1: a fascinating area. And oh, Paris have come up so 106 00:07:06,600 --> 00:07:08,920 Speaker 1: much in the past, it's not surprising me as a lawsuit. 107 00:07:09,440 --> 00:07:17,560 Speaker 1: That's Josh Idlesoon Bloomberg Business Week reporter. Harvey Weinstein faces 108 00:07:17,600 --> 00:07:21,480 Speaker 1: a wave of sexual assault claim stretching back to the seventies. Now, 109 00:07:21,520 --> 00:07:24,600 Speaker 1: Weinstein and his company are facing a civil rights lawsuit 110 00:07:24,680 --> 00:07:27,119 Speaker 1: by the state of New York. The stakes are high, 111 00:07:27,240 --> 00:07:31,040 Speaker 1: including sale of the troubled studio. New York Attorney General 112 00:07:31,160 --> 00:07:35,600 Speaker 1: Eric Schneiderman said a four month investigation revealed a pervasive 113 00:07:35,640 --> 00:07:40,640 Speaker 1: pattern of sexual harassment, intimidation, and discrimination that was flagrant. 114 00:07:41,600 --> 00:07:45,200 Speaker 1: We have never seen anything as despicable as what we've 115 00:07:45,240 --> 00:07:49,080 Speaker 1: seen here. We made it very clear that our three 116 00:07:49,120 --> 00:07:53,440 Speaker 1: principles are very simple. Um victims and employees have to 117 00:07:53,440 --> 00:07:56,160 Speaker 1: be treated fairly going forward. We don't think that is 118 00:07:56,200 --> 00:07:59,600 Speaker 1: too much to ask of anyone who wants to continue 119 00:08:00,000 --> 00:08:03,600 Speaker 1: the work of the Weinstein Company. Or purchase its assets, 120 00:08:04,360 --> 00:08:07,400 Speaker 1: and that last part is key. Schneiderman said an offer 121 00:08:07,480 --> 00:08:11,000 Speaker 1: to buy Weinstein's film and TV company is not acceptable 122 00:08:11,040 --> 00:08:14,640 Speaker 1: in its current form. Weinstein's attorney, Ben Braffman said that 123 00:08:14,720 --> 00:08:18,400 Speaker 1: many of the allegations against Weinstein are without merit, and 124 00:08:18,440 --> 00:08:21,640 Speaker 1: while his behavior was not without fault, there certainly was 125 00:08:21,680 --> 00:08:25,280 Speaker 1: no criminality. My guest is an expert in this area. 126 00:08:25,520 --> 00:08:28,840 Speaker 1: Jennifer and Drew Back, a visiting scholar at Harvard Law School. 127 00:08:29,200 --> 00:08:33,800 Speaker 1: Jennifer tell us more about the allegations in the lawsuit. Well, 128 00:08:33,840 --> 00:08:39,080 Speaker 1: the lawsuit alleges a number of civil rights violations and 129 00:08:39,480 --> 00:08:47,960 Speaker 1: um AT pattern and practice of systemically discriminating against women 130 00:08:48,400 --> 00:08:56,480 Speaker 1: and also enabling Harvey Weinstein to sexually assault UH and 131 00:08:57,240 --> 00:09:05,000 Speaker 1: UH engage in violent behavior with either employees or UM 132 00:09:05,200 --> 00:09:12,840 Speaker 1: women who were potential clients of his Jennifer, Yeah, it's 133 00:09:12,840 --> 00:09:16,600 Speaker 1: just a it's a civil rights lawsuit. Basically, we've seen 134 00:09:16,679 --> 00:09:21,280 Speaker 1: lawsuits by employees against companies for sexual harassment and discrimination, 135 00:09:21,679 --> 00:09:25,040 Speaker 1: civil rights violations. Is it unusual to have a state 136 00:09:25,120 --> 00:09:31,480 Speaker 1: sewer company. It's not unusual in the sense that you 137 00:09:31,640 --> 00:09:36,920 Speaker 1: get UM departments of Fair Employment and housing. Is that 138 00:09:37,240 --> 00:09:41,320 Speaker 1: the department in California, and you can have a variety 139 00:09:41,320 --> 00:09:46,880 Speaker 1: of state agencies UM engaging in lawsuits on behalf of 140 00:09:46,920 --> 00:09:52,880 Speaker 1: aggrieved employees. UM. But typically if there are employees who 141 00:09:52,960 --> 00:09:57,560 Speaker 1: can come forward, they do and they don't go through 142 00:09:58,280 --> 00:10:02,120 Speaker 1: UM like the of typically if they have the ability 143 00:10:02,160 --> 00:10:06,640 Speaker 1: to sue privately on their own UM. Typically because many 144 00:10:06,679 --> 00:10:12,880 Speaker 1: of the state UH agencies don't get as much in 145 00:10:13,160 --> 00:10:16,840 Speaker 1: prosecuting the lawsuits. UM. So this one is a little 146 00:10:16,840 --> 00:10:21,200 Speaker 1: bit unusual in that sense. But UM. I also note 147 00:10:21,920 --> 00:10:26,199 Speaker 1: I've I've read the lawsuit, and I note that UM 148 00:10:26,240 --> 00:10:30,640 Speaker 1: the state is suing not only for violations of these laws, 149 00:10:30,720 --> 00:10:34,120 Speaker 1: but for civil penalties to the State of New York, 150 00:10:34,480 --> 00:10:38,680 Speaker 1: for example, for a hundred thousand dollars for each violation 151 00:10:39,320 --> 00:10:44,240 Speaker 1: UM of particular New York statutes two hundred fifty thousand 152 00:10:44,280 --> 00:10:47,840 Speaker 1: per a violation of another one. So that can add 153 00:10:47,880 --> 00:10:50,920 Speaker 1: up to a lot of money. So there, so the 154 00:10:51,040 --> 00:10:54,520 Speaker 1: Attorney General's office is putting the State of New York 155 00:10:54,880 --> 00:11:00,400 Speaker 1: in as UM as a sort of a we're scipient 156 00:11:00,480 --> 00:11:04,920 Speaker 1: of assets UM from this company and from the Weinstein brothers. 157 00:11:04,960 --> 00:11:09,079 Speaker 1: Weinstein is trying to sell the studio to Maria contraras Sweet, 158 00:11:09,080 --> 00:11:11,280 Speaker 1: who was the head of a small business administration for 159 00:11:11,360 --> 00:11:15,520 Speaker 1: three years under President Obama. This lawsuit was filed electronically 160 00:11:15,600 --> 00:11:18,640 Speaker 1: on Sunday, before the deal was set to close. Why 161 00:11:18,679 --> 00:11:22,200 Speaker 1: did the a G want to block that deal? It's 162 00:11:22,200 --> 00:11:24,160 Speaker 1: not so much that the a G wants to block 163 00:11:24,559 --> 00:11:30,960 Speaker 1: the deal. The a G could have blocked the deal arguably. UM, So, 164 00:11:31,240 --> 00:11:36,960 Speaker 1: what what the AG is doing is putting New York's 165 00:11:37,080 --> 00:11:46,640 Speaker 1: claims on record file and alerting the buyers that the 166 00:11:46,679 --> 00:11:49,920 Speaker 1: State of New York is not agreeable to the sale 167 00:11:50,040 --> 00:11:54,640 Speaker 1: under the sales particular current terms. Now there's some controversy 168 00:11:55,200 --> 00:11:59,720 Speaker 1: over what those terms are in some dispute with the 169 00:11:59,720 --> 00:12:03,720 Speaker 1: BIO is claiming that they have a fund for victims. 170 00:12:03,760 --> 00:12:06,880 Speaker 1: But and at first I was sympathetic because if the 171 00:12:06,920 --> 00:12:09,640 Speaker 1: sale doesn't go through, there's a potential for bankruptcy, in 172 00:12:09,679 --> 00:12:14,480 Speaker 1: which everyone loves it. However, I think the Attorney General 173 00:12:15,040 --> 00:12:18,559 Speaker 1: UM maybe taking some short term hostility for some long 174 00:12:18,720 --> 00:12:24,400 Speaker 1: term gain for the state and everyone else, because um, 175 00:12:24,440 --> 00:12:29,400 Speaker 1: the Attorney General is pointing out some problems. For example, um, 176 00:12:29,559 --> 00:12:33,120 Speaker 1: what has been specified as a fund, it's really a 177 00:12:33,200 --> 00:12:36,480 Speaker 1: litigation fund, which could go to pay attorney such as 178 00:12:36,520 --> 00:12:41,080 Speaker 1: Gloria Alred um, who's representing some of the women who 179 00:12:41,160 --> 00:12:44,680 Speaker 1: have been agreed, And what the a G. S Office 180 00:12:44,720 --> 00:12:47,680 Speaker 1: is specifying is that there would be a victim's fund 181 00:12:47,720 --> 00:12:52,560 Speaker 1: to make sure that the victims are compensated for their injuries. UM. 182 00:12:52,559 --> 00:12:55,800 Speaker 1: There's also some question as to whether or not the 183 00:12:55,880 --> 00:13:02,000 Speaker 1: perpetrators who engaged in cover ups and who facilitated Harvey 184 00:13:02,040 --> 00:13:06,200 Speaker 1: Weinstein's egregious behavior, it looks like they were going to 185 00:13:06,280 --> 00:13:10,480 Speaker 1: continue on with the company once it was purchased, and 186 00:13:10,640 --> 00:13:14,640 Speaker 1: that's part of the Attorney General's problem with the sale. 187 00:13:15,120 --> 00:13:17,520 Speaker 1: And it's not to say that these people wouldn't clean 188 00:13:17,600 --> 00:13:21,680 Speaker 1: up their act under you know, sort of oversight by 189 00:13:21,760 --> 00:13:28,600 Speaker 1: the predominantly female board of directors, but to allow people 190 00:13:28,679 --> 00:13:33,240 Speaker 1: who have engaged in such egregious cover up behavior is 191 00:13:33,280 --> 00:13:38,280 Speaker 1: pretty stocking. UM. And so the Attorney General is on 192 00:13:38,400 --> 00:13:42,079 Speaker 1: behalf the people of New York UH stating some objection 193 00:13:42,160 --> 00:13:44,800 Speaker 1: to that, and I think understandably so. And in this 194 00:13:45,360 --> 00:13:49,520 Speaker 1: era of hashtag me too and times up, UM, I 195 00:13:49,559 --> 00:13:53,040 Speaker 1: think it's important to draw attention to this issue. Jennifer. 196 00:13:53,080 --> 00:13:57,720 Speaker 1: We have just about thirty seconds here. The Equal Employment 197 00:13:57,720 --> 00:14:01,640 Speaker 1: Opportunity Commission hasn't seen a spike in sexual harassment claims 198 00:14:01,720 --> 00:14:05,000 Speaker 1: despite the fallout from the Weinstein scandal and the advent 199 00:14:05,080 --> 00:14:08,920 Speaker 1: of me too. Uh, the me too movement? Is there 200 00:14:08,920 --> 00:14:12,200 Speaker 1: any reason you see for that? In about thirty seconds only, Uh, 201 00:14:12,400 --> 00:14:15,720 Speaker 1: it's it's possible that companies are being proactive. I hope 202 00:14:15,760 --> 00:14:19,680 Speaker 1: that's the answer, and and are taking this in house 203 00:14:20,040 --> 00:14:23,400 Speaker 1: and are resolving these issues, um in a way that 204 00:14:23,440 --> 00:14:26,760 Speaker 1: doesn't require people to go to outside agencies such as 205 00:14:26,800 --> 00:14:29,960 Speaker 1: the eo C. Thank you so much for being here 206 00:14:30,000 --> 00:14:33,800 Speaker 1: and your insights. That's Jennifer and Drove Back, a visiting 207 00:14:33,920 --> 00:14:37,520 Speaker 1: scholar at Harvard Law School. Thanks for listening to the 208 00:14:37,520 --> 00:14:40,920 Speaker 1: Bloomberg Law Podcast. You can subscribe and listen to the 209 00:14:40,920 --> 00:14:44,840 Speaker 1: show on Apple Podcasts, SoundCloud, and on Bloomberg dot com 210 00:14:44,920 --> 00:14:49,080 Speaker 1: slash podcast. I'm June Brosso. This is Bloomberg