1 00:00:03,120 --> 00:00:08,320 Speaker 1: You're listening to Bloomberg Law with June Grosso from Bloomberg Radio. 2 00:00:10,039 --> 00:00:12,920 Speaker 2: Welcome to the weekend edition of Bloomberg Law. Here's a 3 00:00:12,960 --> 00:00:15,440 Speaker 2: look at some of the top stories this week. The 4 00:00:15,560 --> 00:00:20,680 Speaker 2: United Auto Workers strike expands. Texas Attorney General Ken Paxton 5 00:00:20,840 --> 00:00:24,079 Speaker 2: may have been acquitted on impeachment charges, but he's now 6 00:00:24,120 --> 00:00:28,479 Speaker 2: facing a trial for securities fraud. Should schools tell parents 7 00:00:28,520 --> 00:00:32,400 Speaker 2: their children are using new pronouns? And the class action 8 00:00:32,600 --> 00:00:35,880 Speaker 2: lawsuits start over ineffective decongestants. 9 00:00:36,520 --> 00:00:40,120 Speaker 3: It's exciting but very scary because the unknown. You don't 10 00:00:40,120 --> 00:00:41,880 Speaker 3: know when you're going to get that full paycheck again. 11 00:00:41,920 --> 00:00:43,520 Speaker 3: You don't know when you're going to get back in there. 12 00:00:43,360 --> 00:00:44,000 Speaker 4: To work again. 13 00:00:44,640 --> 00:00:48,320 Speaker 2: Tonia Sullivan is a third generation auto worker walking the 14 00:00:48,360 --> 00:00:51,879 Speaker 2: picket line as the United Auto Workers' Union expanded its 15 00:00:52,000 --> 00:00:55,680 Speaker 2: target strikes against the Big three carmakers. More than five 16 00:00:55,760 --> 00:00:59,560 Speaker 2: thousand workers walked out of thirty eight General Motors and 17 00:00:59,640 --> 00:01:04,679 Speaker 2: Stalls facilities on Friday, joining the thirteen thousand auto workers 18 00:01:04,720 --> 00:01:08,120 Speaker 2: who walked off the job last week. Union President Shawn 19 00:01:08,280 --> 00:01:12,080 Speaker 2: Fain announced the stepped up pressure, pointing once again to 20 00:01:12,240 --> 00:01:15,800 Speaker 2: CEO pay raises and profits. The three companies have raked 21 00:01:15,840 --> 00:01:16,920 Speaker 2: in in recent. 22 00:01:16,640 --> 00:01:18,479 Speaker 5: Years across the country. 23 00:01:18,880 --> 00:01:22,120 Speaker 1: People are going to know that the UAW is ready 24 00:01:22,160 --> 00:01:25,559 Speaker 1: to stand up for our communities and ready to stand 25 00:01:25,640 --> 00:01:27,000 Speaker 1: up against corporate greed. 26 00:01:27,200 --> 00:01:30,199 Speaker 2: Ford with spared additional strikes because the company has met 27 00:01:30,200 --> 00:01:33,720 Speaker 2: some of the union's demands during negotiations over the past week. 28 00:01:34,000 --> 00:01:37,119 Speaker 2: Joining me is labor law expert Michael Duff, a professor 29 00:01:37,120 --> 00:01:40,640 Speaker 2: at the Saint Louis University School of Law. Let's talk 30 00:01:40,680 --> 00:01:45,000 Speaker 2: about the way Sean Fain has framed these negotiations as 31 00:01:45,040 --> 00:01:47,600 Speaker 2: a broader struggle. He said, it's the battle of the 32 00:01:47,640 --> 00:01:51,160 Speaker 2: working class against the rich, the haves versus the have nots, 33 00:01:51,200 --> 00:01:54,040 Speaker 2: the billionaire class against everyone else. 34 00:01:54,640 --> 00:01:57,800 Speaker 5: So I come from a blue collar background and a 35 00:01:57,880 --> 00:02:00,480 Speaker 5: prior life. I was a blue collar worker in the 36 00:02:00,480 --> 00:02:03,600 Speaker 5: airline industry. I didn't go to law school until my thirties. 37 00:02:03,840 --> 00:02:06,880 Speaker 5: I was a teamster shop star for a number of years. 38 00:02:06,920 --> 00:02:12,000 Speaker 5: And that rhetoric resonates with me as somebody from that 39 00:02:12,120 --> 00:02:15,400 Speaker 5: class and somebody who has gone through on a personal 40 00:02:15,480 --> 00:02:18,320 Speaker 5: level labor structure. To be honest, we have to look 41 00:02:18,360 --> 00:02:21,120 Speaker 5: at that and say, well, there's a generation of people, 42 00:02:21,320 --> 00:02:24,520 Speaker 5: people of roughly my age or a little bit younger 43 00:02:24,600 --> 00:02:27,280 Speaker 5: who would be very put off by that language that 44 00:02:27,320 --> 00:02:32,760 Speaker 5: would seem extremely corrosive, not tending to lead to agreements 45 00:02:32,840 --> 00:02:36,959 Speaker 5: and so forth. Now we have younger people coming up 46 00:02:37,040 --> 00:02:40,360 Speaker 5: through the ranks of organized labor, and the sort of 47 00:02:40,400 --> 00:02:43,720 Speaker 5: precariousness that a lot of them are facing, I think 48 00:02:43,960 --> 00:02:48,919 Speaker 5: makes the rhetoric almost suddenly appropriate, almost unbelievably to those 49 00:02:48,960 --> 00:02:52,240 Speaker 5: of us who have been involved studying the labor movement 50 00:02:52,440 --> 00:02:55,040 Speaker 5: for the last few decades. So what I think of 51 00:02:55,080 --> 00:02:58,920 Speaker 5: it is that it matches the enormity of some of 52 00:02:58,960 --> 00:03:02,440 Speaker 5: the structural change that we see going on in the 53 00:03:02,520 --> 00:03:03,800 Speaker 5: economy for workers. 54 00:03:04,639 --> 00:03:09,200 Speaker 2: What about this so called stand up strike targeting work 55 00:03:09,280 --> 00:03:10,800 Speaker 2: stoppages at plants. 56 00:03:11,440 --> 00:03:14,760 Speaker 5: Well, I think to the outside observer, a lot of 57 00:03:14,760 --> 00:03:18,639 Speaker 5: this sounds are pretty esoteric and strange, But actually from 58 00:03:18,680 --> 00:03:23,160 Speaker 5: a legal perspective, it makes sense because unions strike at 59 00:03:23,200 --> 00:03:25,920 Speaker 5: their peril, and the reason they strike at their peril 60 00:03:26,080 --> 00:03:30,600 Speaker 5: is that if employees are striking over economic subjects of bargaining, 61 00:03:30,600 --> 00:03:33,680 Speaker 5: that's the phrase of art. So you're not paying me enough, 62 00:03:33,880 --> 00:03:37,600 Speaker 5: I need more contribution to healthcare from you, mister m 63 00:03:37,680 --> 00:03:41,280 Speaker 5: his employer. If they are economic subjects that are sort 64 00:03:41,280 --> 00:03:44,080 Speaker 5: of fomenting the conflict between the union and the player. 65 00:03:44,160 --> 00:03:48,320 Speaker 5: Employees go on and strike, they can be permanently replaced, 66 00:03:48,400 --> 00:03:51,600 Speaker 5: and that's sort of the animating principle behind a lot 67 00:03:51,600 --> 00:03:54,560 Speaker 5: of what's going on here. What permanent replacement means is 68 00:03:54,600 --> 00:03:57,800 Speaker 5: that you go out on strike over an economic subject. 69 00:03:58,240 --> 00:04:01,360 Speaker 5: You can't be fired, but we have to be able 70 00:04:01,400 --> 00:04:04,640 Speaker 5: to attract people to do the job that you're no 71 00:04:04,720 --> 00:04:08,440 Speaker 5: longer doing because you're on strike, and we can't very 72 00:04:08,480 --> 00:04:11,320 Speaker 5: well go to this prospective employee that we want to 73 00:04:11,360 --> 00:04:14,560 Speaker 5: take your place and say, well, we're only going to 74 00:04:14,680 --> 00:04:18,080 Speaker 5: temporarily hire you. Why because we're not going to get 75 00:04:18,160 --> 00:04:20,000 Speaker 5: a lot of people that are going to like that deal. 76 00:04:20,160 --> 00:04:23,200 Speaker 5: So what we say to the replacement worker is you 77 00:04:23,320 --> 00:04:25,640 Speaker 5: come in and you can hold the job as long 78 00:04:25,800 --> 00:04:28,839 Speaker 5: as you want. And so, as a matter of law, 79 00:04:28,920 --> 00:04:32,719 Speaker 5: the employer is not required to fire that person at 80 00:04:32,720 --> 00:04:35,839 Speaker 5: the end of the strike. And so if you're the 81 00:04:35,920 --> 00:04:40,000 Speaker 5: average worker, you go out on strike and you're permanently replaced, 82 00:04:40,040 --> 00:04:43,400 Speaker 5: it's kind of a lawyer's distinction, the distinction between being 83 00:04:43,440 --> 00:04:47,440 Speaker 5: fired from being permanently replaced. If it means no employment, 84 00:04:47,720 --> 00:04:50,120 Speaker 5: then you're out of work either way, right, there's no 85 00:04:50,160 --> 00:04:52,400 Speaker 5: money coming in, you don't have food on the table. 86 00:04:52,760 --> 00:04:56,080 Speaker 5: Once you understand that this is the background rule, you 87 00:04:56,160 --> 00:05:00,640 Speaker 5: begin to understand why unions are very leer come more 88 00:05:00,720 --> 00:05:03,440 Speaker 5: lear over the decades of just going out on strike, 89 00:05:03,480 --> 00:05:05,880 Speaker 5: Because if you go out on strike and the job 90 00:05:06,000 --> 00:05:08,760 Speaker 5: is the kind of job that somebody coming in off 91 00:05:08,800 --> 00:05:11,200 Speaker 5: the street could do, and then what's going to happen 92 00:05:11,279 --> 00:05:13,640 Speaker 5: is the employer is simply going to replace all or 93 00:05:13,680 --> 00:05:16,440 Speaker 5: most of the bargaining unit, and it's a very difficult 94 00:05:16,480 --> 00:05:17,960 Speaker 5: situation for unions. 95 00:05:18,160 --> 00:05:21,160 Speaker 2: Thousands of workers have been laid off. All three of 96 00:05:21,200 --> 00:05:24,160 Speaker 2: the automakers have laid off workers, and they say it's 97 00:05:24,160 --> 00:05:27,880 Speaker 2: because of internal supply chain issues, a lack of parts 98 00:05:27,920 --> 00:05:31,640 Speaker 2: needed for certain assembly workers to do their jobs. Why 99 00:05:31,680 --> 00:05:34,520 Speaker 2: are they citing that? Do they need a reason for 100 00:05:34,680 --> 00:05:36,240 Speaker 2: laying off workers during a strike? 101 00:05:36,880 --> 00:05:40,159 Speaker 5: That's a very good question. So when you lay off 102 00:05:40,440 --> 00:05:45,480 Speaker 5: workers because you don't have enough materials to continue production, 103 00:05:46,200 --> 00:05:50,160 Speaker 5: arguably that's not even a lockout, right, You're not laying 104 00:05:50,279 --> 00:05:53,560 Speaker 5: the workers off, at least on the surface. You're not 105 00:05:53,839 --> 00:05:57,360 Speaker 5: laying them off to pressure the union to accept a 106 00:05:57,400 --> 00:06:01,120 Speaker 5: bargaining position that you have. You're laying workers off because 107 00:06:01,120 --> 00:06:04,680 Speaker 5: you can't continue production. In the old days, we used 108 00:06:04,720 --> 00:06:07,080 Speaker 5: to talk about lockouts, and just give you a sense 109 00:06:07,120 --> 00:06:09,640 Speaker 5: of how far back this line of law goes. It 110 00:06:09,760 --> 00:06:13,640 Speaker 5: used to be that we would say that defensive lockouts 111 00:06:13,920 --> 00:06:18,919 Speaker 5: were lawful, but offensive lockouts were unlawful. The distinction was 112 00:06:18,920 --> 00:06:22,359 Speaker 5: a defensive lockouts you had a good business reason for 113 00:06:22,480 --> 00:06:24,559 Speaker 5: doing what you were doing, right, There was no way 114 00:06:24,600 --> 00:06:27,000 Speaker 5: that you were doing it to pressure the union. You 115 00:06:27,120 --> 00:06:31,640 Speaker 5: had a business justification for locking employees out. I think 116 00:06:31,800 --> 00:06:36,039 Speaker 5: the strategy of the automakers here is the position themselves 117 00:06:36,320 --> 00:06:38,800 Speaker 5: in such a way that it's much harder to say 118 00:06:38,839 --> 00:06:42,320 Speaker 5: that they're doing what they're doing for discriminatory reasons. Probably 119 00:06:42,320 --> 00:06:44,960 Speaker 5: they're allowed to do it anyhow. They're probably allowed to 120 00:06:45,040 --> 00:06:48,520 Speaker 5: do it to pressure the union to accept their bargaining position. 121 00:06:48,640 --> 00:06:52,599 Speaker 5: They arguably could do that. But here they actually have 122 00:06:52,640 --> 00:06:56,200 Speaker 5: a business justification, which is, we can't make cars if 123 00:06:56,240 --> 00:06:56,880 Speaker 5: we don't have. 124 00:06:56,920 --> 00:06:59,680 Speaker 2: Park It sounds like management has all the cars. What 125 00:06:59,839 --> 00:07:01,400 Speaker 2: cars does the union hold? 126 00:07:02,000 --> 00:07:04,960 Speaker 5: Well, the sort of gamesmanship, that's what it is. It's 127 00:07:04,960 --> 00:07:08,040 Speaker 5: a high safe game. But this idea of the stand 128 00:07:08,120 --> 00:07:13,000 Speaker 5: up strike is that by moving around all right, so 129 00:07:13,640 --> 00:07:16,280 Speaker 5: you know, a boxer doesn't stand in one place and 130 00:07:16,400 --> 00:07:19,480 Speaker 5: allow himself to be punched. You sort of move around, 131 00:07:19,520 --> 00:07:23,760 Speaker 5: so you're not on strike at a number of facilities, 132 00:07:24,120 --> 00:07:27,160 Speaker 5: but you are at one key facility, right, And so 133 00:07:27,320 --> 00:07:30,160 Speaker 5: what you're doing is you're setting up a situation where 134 00:07:30,200 --> 00:07:34,560 Speaker 5: the employer could permanently replace in that particular location or 135 00:07:34,640 --> 00:07:37,720 Speaker 5: lock out, but then you have other facilities where nothing's 136 00:07:37,760 --> 00:07:41,640 Speaker 5: going on. It's a variant of something that labor insiders 137 00:07:41,760 --> 00:07:46,200 Speaker 5: called whipsaw strike. This actually goes back a number of decades, right, 138 00:07:46,240 --> 00:07:50,360 Speaker 5: and typically it was a union bargaining with different employers 139 00:07:50,400 --> 00:07:53,560 Speaker 5: than what was called a multi employer bargaining unit. But 140 00:07:53,640 --> 00:07:56,520 Speaker 5: the idea was very similar that what you did was, 141 00:07:56,920 --> 00:07:59,840 Speaker 5: as the employer, you see that the union is striking, 142 00:08:00,080 --> 00:08:03,880 Speaker 5: employers say over there, So what you do is you 143 00:08:04,040 --> 00:08:08,120 Speaker 5: lock out your employees to prevent the union from being 144 00:08:08,160 --> 00:08:11,520 Speaker 5: able to strike according to its own timetable. And the 145 00:08:11,600 --> 00:08:15,720 Speaker 5: idea is that that pressures the union in unforeseen ways. 146 00:08:15,800 --> 00:08:19,520 Speaker 5: But what the union can do is to engage in 147 00:08:19,680 --> 00:08:24,280 Speaker 5: work stoppages in unpredictable ways, it will run into various 148 00:08:24,400 --> 00:08:27,920 Speaker 5: legal doctrines that have been designed over the decades to 149 00:08:28,080 --> 00:08:30,920 Speaker 5: frustrate that kind of maneuver, but I do think that 150 00:08:30,920 --> 00:08:34,160 Speaker 5: that's the union's best opportunity to wind up with a 151 00:08:34,200 --> 00:08:35,000 Speaker 5: positive outcome. 152 00:08:35,040 --> 00:08:39,680 Speaker 2: Here, Sean Fain expanded the strike on Friday, is he 153 00:08:39,840 --> 00:08:41,760 Speaker 2: using a pretty aggressive strategy? 154 00:08:42,240 --> 00:08:45,160 Speaker 5: Well, it is aggressive, And you know what this reminds 155 00:08:45,200 --> 00:08:47,600 Speaker 5: me of. You know, at the end of World War Two, 156 00:08:48,280 --> 00:08:53,280 Speaker 5: aggressive union activity was obviously curtailed during the war and 157 00:08:53,320 --> 00:08:56,200 Speaker 5: there was a lot of hint up labor activity that 158 00:08:56,480 --> 00:08:59,400 Speaker 5: all of a sudden was released at the conclusion of 159 00:08:59,440 --> 00:09:02,240 Speaker 5: the war, and you had a lot of strikes occur, 160 00:09:02,679 --> 00:09:06,320 Speaker 5: and that became the impetus for creation of the Task 161 00:09:06,400 --> 00:09:09,120 Speaker 5: Partly Act, which is a part of the National Labor 162 00:09:09,160 --> 00:09:12,520 Speaker 5: Relations Act as it's been amended. And I almost feel like, 163 00:09:12,840 --> 00:09:16,520 Speaker 5: you know, as a result of just everything that's been 164 00:09:16,559 --> 00:09:19,120 Speaker 5: going on with respect to the gig economy and the 165 00:09:19,120 --> 00:09:23,440 Speaker 5: precariousness of employment, couples with the pandemic and some of 166 00:09:23,520 --> 00:09:26,920 Speaker 5: the labor conflicts that emerged because of the pandemic, a 167 00:09:26,960 --> 00:09:30,800 Speaker 5: lot of it centered on healthcare and perceived dangerous workplaces. 168 00:09:30,880 --> 00:09:34,000 Speaker 5: All of that kind of culminates over this summer. You 169 00:09:34,080 --> 00:09:38,200 Speaker 5: have a situation where workers maybe have had enough, they're 170 00:09:38,200 --> 00:09:40,960 Speaker 5: willing to take risk and I think Sean Fatis is 171 00:09:41,040 --> 00:09:45,199 Speaker 5: tapping into that. He realizes almost viscerally that he has 172 00:09:45,559 --> 00:09:49,200 Speaker 5: a rank and file employee group that's ready to hear 173 00:09:49,280 --> 00:09:53,120 Speaker 5: that message. If that message had been attempted in other eras, 174 00:09:53,120 --> 00:09:55,760 Speaker 5: it might not have been successful. But I think he 175 00:09:56,120 --> 00:10:00,600 Speaker 5: is mirroring some of the emotions that are percolating up 176 00:10:00,640 --> 00:10:03,000 Speaker 5: from the ranked file. And of course he is a 177 00:10:03,080 --> 00:10:05,640 Speaker 5: rank and file memory. He has deep roots in the 178 00:10:05,679 --> 00:10:06,800 Speaker 5: Auto union itself. 179 00:10:06,960 --> 00:10:09,040 Speaker 2: Well, it seems to be working as far as Ford 180 00:10:09,120 --> 00:10:12,840 Speaker 2: is concerned. Let's see what happens next week. Thanks so much, Michael. 181 00:10:13,120 --> 00:10:16,400 Speaker 2: That's Professor Michael Duff of the Saint Louis University School 182 00:10:16,400 --> 00:10:20,720 Speaker 2: of Law. Coming up next. Texas Attorney General Ken Paxton 183 00:10:20,920 --> 00:10:24,240 Speaker 2: was acquitted at his impeachment trial, but now he's facing 184 00:10:24,280 --> 00:10:27,920 Speaker 2: a trial on felony securities fraud charges and is in 185 00:10:28,000 --> 00:10:31,120 Speaker 2: danger of losing his license to practice law. I'm June 186 00:10:31,160 --> 00:10:32,800 Speaker 2: Grosso and you're listening to Bloomberg. 187 00:10:36,240 --> 00:10:41,040 Speaker 1: This is Bloomberg Law with June Grosso from Bloomberg Radio. 188 00:10:43,760 --> 00:10:46,440 Speaker 6: All Rise. The Court of Impeachment of the Texas Senate 189 00:10:46,600 --> 00:10:47,679 Speaker 6: is now in session. 190 00:10:47,960 --> 00:10:51,640 Speaker 2: Texas Attorney General Ken Paxton's eight year tenure as the 191 00:10:51,679 --> 00:10:55,640 Speaker 2: state's top law enforcement officer has been marked by public 192 00:10:55,720 --> 00:10:59,920 Speaker 2: scandals and criminal charges. The toughest test of his political 193 00:11:00,200 --> 00:11:03,880 Speaker 2: resilience came when he was impeached by fellow Republicans in 194 00:11:03,920 --> 00:11:09,280 Speaker 2: the House over allegations including bribery and corruption. Paxton denied 195 00:11:09,320 --> 00:11:12,880 Speaker 2: any wrongdoing and said the impeachment was a political sham 196 00:11:13,360 --> 00:11:17,360 Speaker 2: orchestrated by his opponents, and after a ten day trial 197 00:11:17,520 --> 00:11:20,000 Speaker 2: in the Republican led state Senate. 198 00:11:20,160 --> 00:11:26,000 Speaker 6: Living fourteen yas sixteen nays, a finding of acquittal is 199 00:11:26,160 --> 00:11:28,720 Speaker 6: entered as to Article one. 200 00:11:28,240 --> 00:11:31,880 Speaker 2: And that was the vote on all sixteen charges, a 201 00:11:32,000 --> 00:11:36,160 Speaker 2: resounding acquittal that puts back into office an attorney general 202 00:11:36,200 --> 00:11:40,920 Speaker 2: who's facing trial on felony securities fraud charges. Remains under 203 00:11:41,000 --> 00:11:45,160 Speaker 2: a separate FBI investigation and could be disbarred in an 204 00:11:45,160 --> 00:11:49,000 Speaker 2: ethics case brought by the Texas State Bar. Despite all 205 00:11:49,040 --> 00:11:53,080 Speaker 2: those legal challenges, in his first post trial interviews, a 206 00:11:53,240 --> 00:11:56,319 Speaker 2: newly embold in Paxton took aim at a number of 207 00:11:56,440 --> 00:12:00,960 Speaker 2: high profile fellow Republicans he believes betrayed him, including Texas 208 00:12:01,000 --> 00:12:05,080 Speaker 2: Senator John Cornyn, even telling Tucker Carlson he's not ruling 209 00:12:05,120 --> 00:12:06,839 Speaker 2: out a run for Cornyn's seat. 210 00:12:07,280 --> 00:12:08,280 Speaker 1: You know what, I don't. 211 00:12:08,400 --> 00:12:10,160 Speaker 6: I think he's never really had competition. 212 00:12:11,200 --> 00:12:12,280 Speaker 1: Why do you run against him? 213 00:12:12,440 --> 00:12:13,920 Speaker 6: Hey, look, everything's on the table for me. 214 00:12:14,160 --> 00:12:18,480 Speaker 2: Joining me is Madlin Meckelberg Bloomberg Texas Legal reporter. Madlin 215 00:12:18,559 --> 00:12:23,120 Speaker 2: start by telling us about the articles of impeachment, broadly, 216 00:12:23,160 --> 00:12:24,400 Speaker 2: what was he accused of. 217 00:12:24,640 --> 00:12:29,120 Speaker 7: So Ken Paxton was impeached by the Republican dominated House 218 00:12:29,360 --> 00:12:34,080 Speaker 7: in May of this year on twenty charges that spanned 219 00:12:34,600 --> 00:12:38,240 Speaker 7: the various allegations raised thence he took office as Attorney 220 00:12:38,280 --> 00:12:43,959 Speaker 7: General in twenty fifteen. They talked specifically about allegations raised 221 00:12:44,080 --> 00:12:48,040 Speaker 7: by top staffers in the Attorney General's office who reported 222 00:12:48,120 --> 00:12:52,400 Speaker 7: Paxton to the FBI for alleged bribery. They all really 223 00:12:52,480 --> 00:12:56,840 Speaker 7: center on Paxton's relationship with a friend and political donor 224 00:12:57,000 --> 00:13:00,560 Speaker 7: named Nate Paul, who's a real estate developer in Austin, 225 00:13:01,160 --> 00:13:05,040 Speaker 7: and he's been accused of using his office to aid Paul, 226 00:13:05,559 --> 00:13:09,880 Speaker 7: both in terms of turning over potentially confidential law enforcement 227 00:13:09,920 --> 00:13:14,080 Speaker 7: investigation information to Paul, who was under an FBI probe 228 00:13:14,120 --> 00:13:18,280 Speaker 7: at the time, and issuing opinions that would favor Paul 229 00:13:18,720 --> 00:13:21,760 Speaker 7: in some of his proceedings and so there's twenty different 230 00:13:21,840 --> 00:13:25,080 Speaker 7: articles that go into different facets, but this relationship is 231 00:13:25,120 --> 00:13:26,440 Speaker 7: really what's at the heart of them. 232 00:13:26,800 --> 00:13:29,439 Speaker 2: And we should note that Nate Paul has been federally 233 00:13:29,480 --> 00:13:33,959 Speaker 2: indicted on charges of making false statements to financial institutions. 234 00:13:34,320 --> 00:13:37,400 Speaker 2: Going back to the trial, what evidence stood out to you? 235 00:13:37,920 --> 00:13:41,679 Speaker 7: I think something that really stood out was consistent testimony 236 00:13:41,760 --> 00:13:44,880 Speaker 7: from top employees in his office who said they told 237 00:13:44,960 --> 00:13:48,520 Speaker 7: him time and time again that they were concerned about 238 00:13:48,559 --> 00:13:51,719 Speaker 7: his actions. We heard from people who said that they 239 00:13:51,760 --> 00:13:55,000 Speaker 7: had private conversations with him, who called meetings with him 240 00:13:55,440 --> 00:13:57,280 Speaker 7: to tell him that they were concerned that what he 241 00:13:57,360 --> 00:14:00,360 Speaker 7: was doing was stepping over the line. Something that's really 242 00:14:00,440 --> 00:14:03,360 Speaker 7: key in the case here that gets into this bribery 243 00:14:03,400 --> 00:14:09,120 Speaker 7: allegation is his alleged extramarital affair. One of the accusations 244 00:14:09,280 --> 00:14:11,960 Speaker 7: is that Nate Paul hired the woman with whom he 245 00:14:12,040 --> 00:14:15,000 Speaker 7: was allegedly having an affair and kept her on his payroll, 246 00:14:15,520 --> 00:14:18,560 Speaker 7: and in turn, Paxton was performing these acts in his 247 00:14:18,640 --> 00:14:22,200 Speaker 7: office to benefit Paul. We heard from his former chief 248 00:14:22,240 --> 00:14:24,680 Speaker 7: of staff in the office who talked about how this 249 00:14:24,840 --> 00:14:29,400 Speaker 7: relationship affected the staff and how people were uncomfortable fielding 250 00:14:29,440 --> 00:14:32,400 Speaker 7: phone calls from Paxton's wife and having to make certain 251 00:14:32,400 --> 00:14:35,960 Speaker 7: accommodations for him and this relationship. I think that was 252 00:14:36,000 --> 00:14:37,320 Speaker 7: a really compelling piece of. 253 00:14:37,280 --> 00:14:38,280 Speaker 3: Testimony that we heard. 254 00:14:38,720 --> 00:14:43,120 Speaker 2: Paxton didn't testify in his own defense. He only made 255 00:14:43,120 --> 00:14:46,000 Speaker 2: appearances at the trial at the beginning, in the very end, 256 00:14:46,400 --> 00:14:47,400 Speaker 2: what was his defense. 257 00:14:47,840 --> 00:14:50,480 Speaker 7: The goal for his defense was clear here, and that 258 00:14:50,640 --> 00:14:54,479 Speaker 7: was to cast this as a mutiny by some staffers 259 00:14:54,480 --> 00:14:57,880 Speaker 7: in his office who wanted to take over as attorney 260 00:14:57,960 --> 00:15:01,520 Speaker 7: general potentially. They said, this is is a politically targeted 261 00:15:01,560 --> 00:15:04,840 Speaker 7: attack at Ken Paxton. They say none of the actions 262 00:15:04,880 --> 00:15:07,600 Speaker 7: he took violated the law. All of the things were 263 00:15:07,640 --> 00:15:10,400 Speaker 7: things that he was allowed to do within his power 264 00:15:10,560 --> 00:15:11,640 Speaker 7: as attorney general. 265 00:15:12,000 --> 00:15:15,200 Speaker 2: So Paxton is back in office as the state's top 266 00:15:15,280 --> 00:15:19,880 Speaker 2: law enforcement officer, but he's facing other legal problems. 267 00:15:20,320 --> 00:15:23,640 Speaker 7: That's right, he's been reinstated as attorney general. I think 268 00:15:23,680 --> 00:15:26,360 Speaker 7: there's a lot of eyes now on what happens next. 269 00:15:26,400 --> 00:15:28,720 Speaker 7: How do you go back to that office after going 270 00:15:28,760 --> 00:15:31,080 Speaker 7: through this like really public ordeal where a lot of 271 00:15:31,120 --> 00:15:35,400 Speaker 7: details were shared about your alleged conduct. And then he's 272 00:15:35,440 --> 00:15:39,280 Speaker 7: got other legal battles regarding his conduct that he still 273 00:15:39,320 --> 00:15:42,040 Speaker 7: has to fight, like I mentioned he's been under indictment 274 00:15:42,120 --> 00:15:45,640 Speaker 7: since twenty fifteen or securities fraud in a case that 275 00:15:45,760 --> 00:15:49,000 Speaker 7: is yet to go to trial. It's been delayed significantly 276 00:15:49,200 --> 00:15:53,240 Speaker 7: by these different pre trial squabbles, and he's also tied 277 00:15:53,320 --> 00:15:56,440 Speaker 7: up in some disciplinary proceedings involving the state bar of 278 00:15:56,520 --> 00:16:01,520 Speaker 7: Texas who accused him of professional conduct for his efforts 279 00:16:01,560 --> 00:16:05,160 Speaker 7: to try to overturn the twenty twenty presidential election results. 280 00:16:05,240 --> 00:16:08,880 Speaker 7: And there's an ongoing federal probe into his conduct that 281 00:16:09,040 --> 00:16:12,160 Speaker 7: was prompted by the whistleblowers who are behind some of 282 00:16:12,200 --> 00:16:15,520 Speaker 7: these impeachment plans, So we could still see charges them 283 00:16:15,560 --> 00:16:18,640 Speaker 7: from that. So while this was a significant step, it's 284 00:16:18,680 --> 00:16:22,000 Speaker 7: not the final word on Paxton's legal saga. 285 00:16:22,760 --> 00:16:26,720 Speaker 2: Those two state securities fraud charges, he was indicted on 286 00:16:26,840 --> 00:16:30,280 Speaker 2: those just months after he took office in twenty fifteen, 287 00:16:30,720 --> 00:16:33,600 Speaker 2: and it's always surprised me that that hasn't gone to 288 00:16:33,680 --> 00:16:37,560 Speaker 2: trial yet. How has he managed to avoid trial for eight. 289 00:16:37,400 --> 00:16:41,160 Speaker 7: Years, That's a great question. There's been quite a few 290 00:16:41,240 --> 00:16:44,760 Speaker 7: skirmishes ahead of this trial date. I think a key 291 00:16:44,920 --> 00:16:47,960 Speaker 7: one was venue where the case should be tried, either 292 00:16:48,040 --> 00:16:51,640 Speaker 7: in Houston or in his home county of Colin County. 293 00:16:52,120 --> 00:16:55,680 Speaker 7: There have been objections raised to the prosecutor bringing the case, 294 00:16:56,120 --> 00:16:58,520 Speaker 7: and all of these disputes have gone through a full 295 00:16:58,560 --> 00:17:01,600 Speaker 7: appeals process on their own, going up to the top 296 00:17:01,680 --> 00:17:06,400 Speaker 7: state appeals court in Texas, and they caused significant delays. 297 00:17:06,640 --> 00:17:09,879 Speaker 7: I think. Finally the state appeals court said that the 298 00:17:09,880 --> 00:17:13,600 Speaker 7: case can proceed in Harris County. There was a date 299 00:17:13,720 --> 00:17:16,639 Speaker 7: here in state for Paxton in the case just before 300 00:17:16,680 --> 00:17:20,200 Speaker 7: the impeachment proceedings began, and the judge said, once those 301 00:17:20,240 --> 00:17:23,840 Speaker 7: proceedings wrapped, she's ready to get this case moving again 302 00:17:23,920 --> 00:17:24,720 Speaker 7: in Harris County. 303 00:17:25,320 --> 00:17:30,000 Speaker 2: And as you said, there is an investigation by the 304 00:17:30,200 --> 00:17:34,560 Speaker 2: FBI and the Justice Department's Public Integrity Section. Is that 305 00:17:34,640 --> 00:17:39,120 Speaker 2: on the same allegations that were testified to in the 306 00:17:39,200 --> 00:17:40,440 Speaker 2: impeachment trial. 307 00:17:40,960 --> 00:17:45,120 Speaker 7: That's right. So these top employees in Paxton's office, who 308 00:17:45,400 --> 00:17:49,280 Speaker 7: we call the whistleblowers, they reported Paxton's conduct to the 309 00:17:49,359 --> 00:17:53,040 Speaker 7: FBI as it relates to advancing causes on behalf of 310 00:17:53,119 --> 00:17:57,359 Speaker 7: his friend and political donor Nate Paul, and the FBI 311 00:17:57,480 --> 00:18:00,800 Speaker 7: and the DOJ they've been investigating. We have seen the 312 00:18:00,920 --> 00:18:04,080 Speaker 7: result of that investigation up to this point, but those 313 00:18:04,119 --> 00:18:05,160 Speaker 7: cases are ongoing. 314 00:18:05,640 --> 00:18:08,960 Speaker 2: And just to be clear, he was re elected last 315 00:18:09,080 --> 00:18:12,679 Speaker 2: year to a third term despite all these criminal and 316 00:18:12,720 --> 00:18:13,960 Speaker 2: ethical allegations. 317 00:18:14,240 --> 00:18:16,439 Speaker 7: That's exactly right, and that was a point that we 318 00:18:16,560 --> 00:18:20,639 Speaker 7: heard from Paxton's defense council throughout the proceedings. They said, 319 00:18:20,880 --> 00:18:23,720 Speaker 7: Texas voters knew about these allegations and made it a 320 00:18:23,800 --> 00:18:26,879 Speaker 7: care they elected him anyway, and so why should the 321 00:18:26,920 --> 00:18:30,000 Speaker 7: state Senate overturn that? Why should they overturn the will 322 00:18:30,040 --> 00:18:30,640 Speaker 7: of the voters. 323 00:18:30,840 --> 00:18:36,200 Speaker 2: And Paxton seems newly emboldened by his acquittal. Some political 324 00:18:36,240 --> 00:18:40,439 Speaker 2: experts think that he could gain prominence on the national stage. 325 00:18:40,760 --> 00:18:43,800 Speaker 7: I think that's totally fair. I mean, from the beginning, 326 00:18:43,840 --> 00:18:48,440 Speaker 7: Paxton's reputation has been built on being a conservative agitator 327 00:18:48,600 --> 00:18:52,720 Speaker 7: who does the Biden administration over everything that they do, 328 00:18:53,400 --> 00:18:57,600 Speaker 7: and he's worked to align himself with former President Donald Trump, 329 00:18:57,680 --> 00:19:01,480 Speaker 7: who we saw go through a similar thing during his presidency, 330 00:19:01,840 --> 00:19:05,960 Speaker 7: being acquitted in impeachment cases and only serving to boost 331 00:19:05,960 --> 00:19:08,760 Speaker 7: his reputation. And I think that that's exactly what we're 332 00:19:08,760 --> 00:19:11,280 Speaker 7: going to see happen here with Paxton, who's going to 333 00:19:11,400 --> 00:19:15,040 Speaker 7: certainly be emboldened by this outcome. I think we're still 334 00:19:15,080 --> 00:19:17,240 Speaker 7: waiting kind of with bated breast to see what his 335 00:19:17,280 --> 00:19:19,320 Speaker 7: first moves are going to be now that he's been 336 00:19:19,359 --> 00:19:22,520 Speaker 7: reinstated to the office. But I think it's certainly fair 337 00:19:22,560 --> 00:19:24,960 Speaker 7: to say that this has only helped to bolster his 338 00:19:25,040 --> 00:19:26,600 Speaker 7: reputation within his own party. 339 00:19:26,920 --> 00:19:29,879 Speaker 2: A lot more to come in the legal sagas of 340 00:19:30,000 --> 00:19:33,880 Speaker 2: Ken Paxton, and I know you'll be following that Forrest Madeline. 341 00:19:33,880 --> 00:19:37,159 Speaker 2: Thanks so much. That's Bloomberg Texas Legal reporter and Madelin 342 00:19:37,240 --> 00:19:41,000 Speaker 2: Mecklberg coming up next on the Bloomberg Law Show. A 343 00:19:41,080 --> 00:19:44,680 Speaker 2: new legal battle is emerging over whether schools should tell 344 00:19:44,800 --> 00:19:49,320 Speaker 2: parents that their children are using new preferred pronouns. I'm 345 00:19:49,400 --> 00:19:51,679 Speaker 2: June Grosso and you're listening to Bloomberg. 346 00:19:54,960 --> 00:19:59,760 Speaker 1: This is Bloomberg Law with June Grosso from Bloomberg Radio. 347 00:20:00,880 --> 00:20:03,800 Speaker 8: When children say they identify as something other than their 348 00:20:03,840 --> 00:20:06,760 Speaker 8: sex at school, do they become mere creatures of the state, 349 00:20:07,560 --> 00:20:10,840 Speaker 8: or do their fit parents still have the fundamental right 350 00:20:10,920 --> 00:20:13,000 Speaker 8: to make decisions regarding their care. 351 00:20:14,040 --> 00:20:18,359 Speaker 2: The emerging legal battle over pronoun protocol in public schools 352 00:20:18,640 --> 00:20:21,640 Speaker 2: has nothing to do with grammar and everything to do 353 00:20:21,720 --> 00:20:26,040 Speaker 2: with gender identity. Some parents are suing schools that keep 354 00:20:26,080 --> 00:20:29,760 Speaker 2: their children's use of new pronouns secret, claiming it's a 355 00:20:29,840 --> 00:20:33,359 Speaker 2: violation of their constitutional right to direct the upbringing of 356 00:20:33,400 --> 00:20:37,560 Speaker 2: their children. The Ludlow, Massachusetts School Committee is being sued 357 00:20:37,920 --> 00:20:41,479 Speaker 2: over a teacher's failure to notify parents that their eleven 358 00:20:41,560 --> 00:20:45,919 Speaker 2: year old began using different preferred pronouns. A federal judge 359 00:20:45,920 --> 00:20:49,359 Speaker 2: dismissed the parent's complaint, but the First Circuit Court of 360 00:20:49,400 --> 00:20:52,879 Speaker 2: Appeals could revive it, and at oral arguments, the judges 361 00:20:52,920 --> 00:20:56,119 Speaker 2: seem to be wrestling with the issues. Here are judges 362 00:20:56,200 --> 00:20:58,200 Speaker 2: Julie Reichlemann and Kermit Leipez. 363 00:20:58,880 --> 00:21:02,360 Speaker 9: I think gender identify is clearly very important to everyone, 364 00:21:02,560 --> 00:21:04,600 Speaker 9: and there are many things that happen in school every 365 00:21:04,680 --> 00:21:08,520 Speaker 9: day that would qualify is less important than that. So 366 00:21:08,840 --> 00:21:12,359 Speaker 9: do you really see no limiting principle between something like 367 00:21:12,480 --> 00:21:15,600 Speaker 9: the gender identity of your child and who your child 368 00:21:15,680 --> 00:21:18,040 Speaker 9: may have played with during recess that day. Are you 369 00:21:18,080 --> 00:21:19,639 Speaker 9: really saying there's no difference there? 370 00:21:20,920 --> 00:21:24,280 Speaker 6: But you seem to be assert bottom line that the 371 00:21:24,359 --> 00:21:31,280 Speaker 6: rights of the student to preclude disclosure of this request 372 00:21:31,320 --> 00:21:34,840 Speaker 6: to use pronouns trump's the right of the parents to 373 00:21:35,000 --> 00:21:38,960 Speaker 6: know what's going on with respect to the child's gender identity. 374 00:21:39,560 --> 00:21:41,480 Speaker 6: Bottom line you are asserting. 375 00:21:41,000 --> 00:21:44,000 Speaker 2: That, aren't you joining me? Is Audrey Anderson, head of 376 00:21:44,040 --> 00:21:48,439 Speaker 2: the higher education practice at Bassbari and Simms. Audrey explain 377 00:21:48,480 --> 00:21:50,080 Speaker 2: why the parents are suing here. 378 00:21:51,040 --> 00:21:56,280 Speaker 3: The school where their children middle school are attended, have 379 00:21:56,400 --> 00:22:01,200 Speaker 3: a policy that's not an unusual policy that says, if 380 00:22:01,240 --> 00:22:04,920 Speaker 3: the students come to personnel in the school and say 381 00:22:04,920 --> 00:22:08,880 Speaker 3: that they want to change their name, change their pronoun 382 00:22:09,560 --> 00:22:13,800 Speaker 3: to the opposite gender that they were born into, the 383 00:22:13,800 --> 00:22:16,800 Speaker 3: school will work with them to do that, and also 384 00:22:17,000 --> 00:22:21,800 Speaker 3: we'll keep that information from the student's parents if the 385 00:22:21,840 --> 00:22:25,200 Speaker 3: students ask for it to be kept from their parents. 386 00:22:25,400 --> 00:22:28,359 Speaker 3: So the parents here were aware that one of their 387 00:22:28,480 --> 00:22:33,320 Speaker 3: children was experiencing some questions about their gender and actually 388 00:22:33,320 --> 00:22:36,320 Speaker 3: reached out to the school proactively to say, we don't 389 00:22:36,640 --> 00:22:39,840 Speaker 3: want you to talk to our child about this, and 390 00:22:39,960 --> 00:22:44,080 Speaker 3: the school, nevertheless, behind the parents' backs, talk to the child, 391 00:22:44,600 --> 00:22:48,760 Speaker 3: started calling the child by a different name, use different pronouns, 392 00:22:49,280 --> 00:22:52,680 Speaker 3: and the parents, understandably were very upset about this. 393 00:22:53,480 --> 00:22:57,840 Speaker 2: What surprises me about this is that at that age, 394 00:22:58,080 --> 00:23:01,639 Speaker 2: if your kid seems aggressed, gets into a fight with someone, 395 00:23:02,000 --> 00:23:04,359 Speaker 2: the teachers are on the phone, are calling you in 396 00:23:04,760 --> 00:23:06,800 Speaker 2: and yet they don't want to tell them about this 397 00:23:07,480 --> 00:23:10,080 Speaker 2: very important aspect of their kid's life. 398 00:23:10,320 --> 00:23:14,840 Speaker 3: The countervailing policy decision here, and I think one reason 399 00:23:14,920 --> 00:23:17,720 Speaker 3: why the parents are going to have a particularly hard 400 00:23:17,800 --> 00:23:21,399 Speaker 3: time winning this case is if there's a Massachusetts law 401 00:23:21,520 --> 00:23:26,880 Speaker 3: that requires schools to not discriminate against students because of 402 00:23:27,000 --> 00:23:33,280 Speaker 3: their gender identity. And so this school has decided that 403 00:23:33,400 --> 00:23:37,320 Speaker 3: in order to carry out that duty, they need to 404 00:23:37,400 --> 00:23:41,760 Speaker 3: keep that information about the student private if the student 405 00:23:41,840 --> 00:23:45,040 Speaker 3: asks for it to be private. So the school district 406 00:23:45,119 --> 00:23:48,480 Speaker 3: here says, well, we have this date law that says 407 00:23:48,480 --> 00:23:52,040 Speaker 3: we are not allowed to discriminate on the basis of 408 00:23:52,280 --> 00:23:56,639 Speaker 3: gender identity. And there are some students for which it 409 00:23:56,680 --> 00:24:00,199 Speaker 3: won't be safe for them at home. If their parents 410 00:24:00,200 --> 00:24:05,520 Speaker 3: to know that they are going by a different gender identity, 411 00:24:05,600 --> 00:24:10,320 Speaker 3: it may become psychologically unsafe for them at home. So 412 00:24:10,400 --> 00:24:14,479 Speaker 3: that's the countervailing thing and why this is different in 413 00:24:14,560 --> 00:24:18,240 Speaker 3: the school's mind from your child god in a fight, 414 00:24:18,440 --> 00:24:21,480 Speaker 3: or your child through up at school, or all the 415 00:24:21,600 --> 00:24:24,560 Speaker 3: other things that happened to kids at school that the 416 00:24:24,680 --> 00:24:26,320 Speaker 3: school does tell parents about. 417 00:24:26,760 --> 00:24:30,560 Speaker 2: Did the school just call the child by preferred pronouns 418 00:24:30,720 --> 00:24:32,800 Speaker 2: or did the school do more than that? 419 00:24:33,320 --> 00:24:36,240 Speaker 3: They also had somebody at the school meet with the 420 00:24:36,359 --> 00:24:40,440 Speaker 3: child regularly to talk to them about how they were 421 00:24:40,480 --> 00:24:43,199 Speaker 3: feeling and be a resource person for them. And the 422 00:24:43,320 --> 00:24:47,680 Speaker 3: parents here alleged that in that way they were actually 423 00:24:47,720 --> 00:24:53,720 Speaker 3: giving mental health treatment to their child without the parent's consent. Now, 424 00:24:53,720 --> 00:24:58,720 Speaker 3: the district court found that they hadn't adequately alleged facts 425 00:24:58,760 --> 00:25:02,680 Speaker 3: to support a concl inclusion that the child was receiving 426 00:25:03,160 --> 00:25:07,400 Speaker 3: mental health treatment, though the district court kind of threw 427 00:25:07,440 --> 00:25:10,000 Speaker 3: that out based on the factual allegation. 428 00:25:10,720 --> 00:25:15,200 Speaker 2: The district court used a standard, a very tough standard, 429 00:25:15,440 --> 00:25:18,480 Speaker 2: shocking the conscience. Tell us what that standard is and 430 00:25:18,840 --> 00:25:21,560 Speaker 2: is it appropriate in this case? Is it the correct 431 00:25:21,640 --> 00:25:22,720 Speaker 2: standard in this case? 432 00:25:23,240 --> 00:25:23,359 Speaker 5: Well? 433 00:25:23,440 --> 00:25:27,160 Speaker 3: Yes, the parents here are alleging that their substantive due 434 00:25:27,240 --> 00:25:31,639 Speaker 3: process rights were violated, and the court I think used 435 00:25:31,640 --> 00:25:36,119 Speaker 3: the right standard to figure that out. You know, the 436 00:25:36,160 --> 00:25:39,199 Speaker 3: parents in the Court of Appeals have said that the 437 00:25:39,240 --> 00:25:42,879 Speaker 3: district court kind of made that standard extra tough. But 438 00:25:43,440 --> 00:25:46,800 Speaker 3: the cases I've looked at deemed to require that the 439 00:25:46,840 --> 00:25:50,800 Speaker 3: facts alleged really have to shock the conscience, and they're 440 00:25:50,880 --> 00:25:56,400 Speaker 3: usually looking for something where the state actor has intentionally 441 00:25:57,119 --> 00:26:02,040 Speaker 3: inflicted harm on the person who is suing. So, you know, 442 00:26:02,080 --> 00:26:05,240 Speaker 3: one of the cases I saw where there actually was 443 00:26:05,359 --> 00:26:10,240 Speaker 3: substantive due process adequately alleged was where a school coach 444 00:26:10,400 --> 00:26:15,840 Speaker 3: had intentionally used a hard object to hit a student 445 00:26:15,920 --> 00:26:20,840 Speaker 3: in the face. That shocked the conscience. But there's lots 446 00:26:20,880 --> 00:26:24,800 Speaker 3: of things where students are hurt where it might be upsetting, 447 00:26:25,200 --> 00:26:28,600 Speaker 3: but it doesn't reach that shock the conscience standard, and 448 00:26:28,720 --> 00:26:33,439 Speaker 3: substantive due process is a very tricky legal standard that 449 00:26:33,880 --> 00:26:38,240 Speaker 3: lots of judges think should be circumscribed, that there should 450 00:26:38,280 --> 00:26:41,720 Speaker 3: be very few things that we find are protected by 451 00:26:41,880 --> 00:26:46,560 Speaker 3: substantive due process. So what's established is the right to marry, 452 00:26:47,240 --> 00:26:50,440 Speaker 3: the right to have children. So they want to keep 453 00:26:50,480 --> 00:26:54,800 Speaker 3: the range of things that are within substantive due process 454 00:26:54,840 --> 00:26:58,040 Speaker 3: really small. Now, these parents say that, well, what's within 455 00:26:58,320 --> 00:27:02,760 Speaker 3: substantive due process is the right to raise your children 456 00:27:02,880 --> 00:27:06,200 Speaker 3: as you see fit. The thing they run into there 457 00:27:06,520 --> 00:27:09,439 Speaker 3: is that there are Supreme Court cases that support that. 458 00:27:10,080 --> 00:27:14,239 Speaker 3: But what they support is the right to raise your 459 00:27:14,320 --> 00:27:17,840 Speaker 3: children as you see fit in a private school setting. 460 00:27:18,480 --> 00:27:21,360 Speaker 3: So to me, those cases only say that these parents 461 00:27:21,880 --> 00:27:24,360 Speaker 3: have a right to send their children to a school 462 00:27:24,760 --> 00:27:27,119 Speaker 3: that would not have a policy like this. I think 463 00:27:27,160 --> 00:27:30,440 Speaker 3: it's much harder to say that within the public schools 464 00:27:30,880 --> 00:27:33,160 Speaker 3: they get to have a right to say what the 465 00:27:33,240 --> 00:27:37,280 Speaker 3: policy is on something like this. Here's my caveat. I'm 466 00:27:37,280 --> 00:27:41,280 Speaker 3: surprised that they haven't raised a religious argument. I think 467 00:27:41,320 --> 00:27:44,200 Speaker 3: that they'd have a stronger argument if they were also 468 00:27:44,520 --> 00:27:49,480 Speaker 3: raising some kind of a free exercise argument, that our 469 00:27:49,520 --> 00:27:54,280 Speaker 3: religion also supports the idea that you are the gender 470 00:27:54,320 --> 00:27:56,800 Speaker 3: that you're born into, and so for you to be 471 00:27:56,880 --> 00:28:00,640 Speaker 3: teaching our child something other than that and sporting them 472 00:28:00,760 --> 00:28:05,440 Speaker 3: transitioning when we've told you not to violate our religious rights. 473 00:28:05,640 --> 00:28:07,359 Speaker 3: But they haven't argued that in this case. 474 00:28:07,960 --> 00:28:11,480 Speaker 2: So this First Circuit decision will be the highest court 475 00:28:11,560 --> 00:28:16,040 Speaker 2: ruling on the merits of this argument. There's a case 476 00:28:16,080 --> 00:28:19,720 Speaker 2: before the Eleventh Circuit which is very conservative, so there 477 00:28:19,800 --> 00:28:22,480 Speaker 2: might end up being some kind of split in the circuits. 478 00:28:23,000 --> 00:28:25,520 Speaker 3: Yeah, I definitely agree with that. I think that this 479 00:28:25,720 --> 00:28:30,399 Speaker 3: is an issue that some conservative court will find that 480 00:28:30,720 --> 00:28:33,520 Speaker 3: at least a complaint can go forward, and then the 481 00:28:33,600 --> 00:28:36,800 Speaker 3: question will be whether the Supreme Court gets interested enough 482 00:28:36,880 --> 00:28:39,720 Speaker 3: at that point or whether they want a case with 483 00:28:39,800 --> 00:28:43,840 Speaker 3: a little bit more factual development, something that goes to 484 00:28:44,360 --> 00:28:47,840 Speaker 3: a summary judgment motion at least or maybe even a 485 00:28:47,960 --> 00:28:52,160 Speaker 3: trial before they decide to weigh in on this. You 486 00:28:52,200 --> 00:28:55,120 Speaker 3: know when the Supreme Court. If when the Supreme Court 487 00:28:55,360 --> 00:28:57,600 Speaker 3: weighs into this, I think that some of the justices 488 00:28:57,640 --> 00:29:00,880 Speaker 3: will have a hard time because the concern servative side 489 00:29:00,920 --> 00:29:03,920 Speaker 3: of the Supreme Court wants very much to have a 490 00:29:04,280 --> 00:29:09,520 Speaker 3: very very narrow set of circumstances where substantive process protects 491 00:29:09,600 --> 00:29:12,920 Speaker 3: rights and justice. Thomas doesn't think that there is such 492 00:29:12,920 --> 00:29:16,160 Speaker 3: a thing as substantivety process. On the other hand, I 493 00:29:16,200 --> 00:29:20,560 Speaker 3: would believe them to be very concerned about these kinds 494 00:29:20,560 --> 00:29:23,520 Speaker 3: of school policies. So how they will thread that needle, 495 00:29:24,200 --> 00:29:26,440 Speaker 3: I think will be very interesting. 496 00:29:27,080 --> 00:29:31,160 Speaker 2: Well, certainly this case is being watched nationally. There were 497 00:29:31,160 --> 00:29:35,320 Speaker 2: more than one hundred amkas briefs filed, including from nineteen 498 00:29:35,440 --> 00:29:40,000 Speaker 2: states that supported the parents' position and fifteen states that 499 00:29:40,080 --> 00:29:43,920 Speaker 2: supported the school's position. So we'll see other first circuit rules. 500 00:29:43,960 --> 00:29:47,440 Speaker 2: Thanks so much, Audrey. That's Audrey Anderson, head of the 501 00:29:47,480 --> 00:29:51,760 Speaker 2: higher education practice at bess Berry and Simms. Coming up next, 502 00:29:52,000 --> 00:29:56,400 Speaker 2: the lawsuits start over ineffective decongestins. This is Bloomberg. 503 00:30:00,000 --> 00:30:04,680 Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg radio. 504 00:30:05,760 --> 00:30:09,080 Speaker 2: We're approaching cold and flu season, and advisors to the 505 00:30:09,120 --> 00:30:12,360 Speaker 2: Food and Drug Administration say the key drug and the 506 00:30:12,480 --> 00:30:16,920 Speaker 2: leading over the counter decongestants used by millions of Americans 507 00:30:17,400 --> 00:30:21,160 Speaker 2: is no better than a placebo. Allergists like doctor Purvy 508 00:30:21,200 --> 00:30:25,240 Speaker 2: Perik say consumers should read the labels of coal medications. 509 00:30:25,720 --> 00:30:30,360 Speaker 2: This ingredient panel affron is in so many different cold medicines. 510 00:30:30,480 --> 00:30:33,600 Speaker 2: That's why it is important to kind of educate yourself 511 00:30:33,600 --> 00:30:34,120 Speaker 2: on what to. 512 00:30:34,120 --> 00:30:36,560 Speaker 7: Look for and just avoid that ingredient. 513 00:30:37,040 --> 00:30:41,240 Speaker 2: It was predictable that shortly after the FDA's announcement, class 514 00:30:41,280 --> 00:30:45,600 Speaker 2: action lawsuits were filed against pharmaceutical companies and retailers on 515 00:30:45,680 --> 00:30:49,600 Speaker 2: behalf of consumers joining me is healthcare attorney Harry Nelson 516 00:30:49,920 --> 00:30:55,520 Speaker 2: of Nelson Hardiman. Class action lawsuits were filed within days 517 00:30:55,560 --> 00:30:58,200 Speaker 2: of the FDA's announcement. 518 00:30:58,680 --> 00:31:01,120 Speaker 4: I mean, it's almost reflective. There are planet of law 519 00:31:01,120 --> 00:31:04,200 Speaker 4: firms around the countries that are basically built to take 520 00:31:04,320 --> 00:31:07,960 Speaker 4: on harm related to different drugs, and so as soon 521 00:31:08,000 --> 00:31:10,440 Speaker 4: as the FDA said the drug was ineffective, it's not 522 00:31:10,480 --> 00:31:13,040 Speaker 4: a surprise that we saw the first class action filed 523 00:31:13,080 --> 00:31:16,000 Speaker 4: down in Florida. The real question is other than the 524 00:31:16,080 --> 00:31:19,760 Speaker 4: harm to people's wallets from spending one point seventy five 525 00:31:19,760 --> 00:31:22,720 Speaker 4: billion on the drug, what actual harm? You know, whether 526 00:31:22,720 --> 00:31:25,280 Speaker 4: there were any side effects that actually hurt anybody from 527 00:31:25,320 --> 00:31:27,000 Speaker 4: fenel effronts. There are a lot of reports of like 528 00:31:27,120 --> 00:31:31,360 Speaker 4: minor problems like swelling or in rashes and itching, but 529 00:31:31,440 --> 00:31:33,960 Speaker 4: I'm not aware of any severe harm, and it's not 530 00:31:34,120 --> 00:31:36,680 Speaker 4: clear what kind of damages they are going to be 531 00:31:36,680 --> 00:31:38,760 Speaker 4: beyond just the fact that these companies were selling an 532 00:31:38,760 --> 00:31:39,600 Speaker 4: ineffect or drug. 533 00:31:40,120 --> 00:31:44,480 Speaker 2: Some of the complaints charged that the defendants violated consumer 534 00:31:44,560 --> 00:31:49,120 Speaker 2: protection statutes and alleged a breach of implied warranty of 535 00:31:49,160 --> 00:31:51,200 Speaker 2: merchant ability and they committed fraud. 536 00:31:51,640 --> 00:31:52,560 Speaker 8: But if the. 537 00:31:52,560 --> 00:31:57,240 Speaker 2: FDA approved this, what were the manufacturers supposed to do? Say, no, 538 00:31:57,400 --> 00:31:58,480 Speaker 2: the FDA is wrong. 539 00:31:59,120 --> 00:32:01,880 Speaker 4: You know, there's been a lot of industry studies going on, 540 00:32:02,040 --> 00:32:05,040 Speaker 4: so we know that, for example, competitors of some of 541 00:32:05,040 --> 00:32:07,240 Speaker 4: the mls and products, like the folks that sharing Plot 542 00:32:07,280 --> 00:32:10,280 Speaker 4: who were making Clereson, were doing a lot of research 543 00:32:10,360 --> 00:32:12,480 Speaker 4: to show that and arguing that these drugs were ineffective. 544 00:32:12,680 --> 00:32:17,120 Speaker 4: It's an interesting question whether internally whether the manufacturers were 545 00:32:17,120 --> 00:32:20,400 Speaker 4: doing their own research and had reason to know that 546 00:32:20,480 --> 00:32:23,040 Speaker 4: these drugs were not effective, and whether they turned a 547 00:32:23,040 --> 00:32:25,240 Speaker 4: blind eye to it. I think it's an interesting question, 548 00:32:25,320 --> 00:32:28,080 Speaker 4: and hopefully we'll learn about some of the internal process 549 00:32:28,320 --> 00:32:31,000 Speaker 4: within the pharmaceuticals and how much they were aware of 550 00:32:31,040 --> 00:32:33,560 Speaker 4: this and taking it seriously and concerned about it. But 551 00:32:33,680 --> 00:32:36,080 Speaker 4: you know, I think that still remains ahead of us. 552 00:32:36,520 --> 00:32:39,920 Speaker 2: You mentioned harm to consumers and that there's probably very 553 00:32:39,920 --> 00:32:44,360 Speaker 2: little of that, so it would be limited to economic damages, right. 554 00:32:44,600 --> 00:32:46,800 Speaker 4: I think what's likely to happen. I mean, I don't 555 00:32:46,840 --> 00:32:49,520 Speaker 4: mean to sound cynical, but when this case gets prosecuted, 556 00:32:49,600 --> 00:32:51,640 Speaker 4: what's likely to happen is that the lawyers who brought 557 00:32:51,680 --> 00:32:55,920 Speaker 4: these cases will have a multimillion dollar payday and attorneys fees, 558 00:32:56,200 --> 00:32:58,800 Speaker 4: and they'll be coupons, you know, for people who can 559 00:32:58,840 --> 00:33:01,200 Speaker 4: prove that they bought the drugs, But those coupons will 560 00:33:01,200 --> 00:33:04,520 Speaker 4: be for insignificant amounts. The big winners in this class 561 00:33:04,520 --> 00:33:06,840 Speaker 4: action are likely to be the lawyers who get tens 562 00:33:06,840 --> 00:33:08,280 Speaker 4: of millions of dollars for filing it. 563 00:33:08,720 --> 00:33:13,560 Speaker 2: As an example, Johnson and Johnson's consumer unit settle claims 564 00:33:13,600 --> 00:33:18,560 Speaker 2: alleging aerosol products contained benzene for one point seventy five 565 00:33:18,640 --> 00:33:23,040 Speaker 2: million dollars plus two point five million in attorneys fees, 566 00:33:23,600 --> 00:33:27,360 Speaker 2: so more an attorney's fees than in the settlement for consumers. 567 00:33:27,960 --> 00:33:28,200 Speaker 6: Yeah. 568 00:33:28,240 --> 00:33:30,120 Speaker 4: So a lot of people and including me, think it 569 00:33:30,400 --> 00:33:32,920 Speaker 4: is a defect in our class action systems that, you know, 570 00:33:32,960 --> 00:33:36,200 Speaker 4: the plane of class action lawyers are motivated to bring 571 00:33:36,480 --> 00:33:39,760 Speaker 4: cases that really don't do much to advance the public interest, 572 00:33:39,960 --> 00:33:43,640 Speaker 4: but to produce profitable work for them. Kind of a 573 00:33:43,800 --> 00:33:47,200 Speaker 4: sort of bug in our class action system that anytime 574 00:33:47,240 --> 00:33:48,880 Speaker 4: there's a drug even if the harm to the public 575 00:33:48,960 --> 00:33:51,280 Speaker 4: is really miniscule, the plane of class action lawyers have 576 00:33:51,320 --> 00:33:52,200 Speaker 4: a big opportunity. 577 00:33:52,400 --> 00:33:55,680 Speaker 2: Are those kinds of suits mostly settled? Do any of 578 00:33:55,760 --> 00:33:56,880 Speaker 2: them ever go to trial? 579 00:33:57,520 --> 00:33:59,720 Speaker 4: This is certainly not a case that's going to trial. 580 00:34:00,000 --> 00:34:03,800 Speaker 4: You know, if there were big damages and significant amounts 581 00:34:03,800 --> 00:34:06,160 Speaker 4: that would be you know, at risk, like if the 582 00:34:06,200 --> 00:34:09,440 Speaker 4: harm caused by a final effron was so significant, then 583 00:34:09,440 --> 00:34:11,960 Speaker 4: there would be something to fight over and a lot 584 00:34:12,000 --> 00:34:14,959 Speaker 4: at stakes. But you know, the money that the drug 585 00:34:14,960 --> 00:34:17,120 Speaker 4: companies are likely to pay for this is going to 586 00:34:17,160 --> 00:34:19,719 Speaker 4: be something like a rounding error for them. This is 587 00:34:19,719 --> 00:34:22,040 Speaker 4: not going to be one of those multi billion dollar settlements. 588 00:34:22,080 --> 00:34:24,879 Speaker 4: It's likely that the plans class ection layers will kind 589 00:34:24,880 --> 00:34:27,680 Speaker 4: of have a get in quick, you know, reach the settlements, 590 00:34:27,880 --> 00:34:30,200 Speaker 4: and the drug companies will be offered numbers that will 591 00:34:30,200 --> 00:34:32,359 Speaker 4: motivate them to do so. I think it's a pretty 592 00:34:32,400 --> 00:34:33,920 Speaker 4: safe bet that we're never going to see a trial 593 00:34:34,000 --> 00:34:35,840 Speaker 4: on the marketing of a penel efron. 594 00:34:36,120 --> 00:34:39,839 Speaker 2: Thanks Harry. That's Harry Nelson of Nelson Hardiman, and that's 595 00:34:39,880 --> 00:34:42,480 Speaker 2: it for this edition of the Bloomberg Law Show. Remember 596 00:34:42,520 --> 00:34:44,640 Speaker 2: you can always get the latest legal news on our 597 00:34:44,640 --> 00:34:48,799 Speaker 2: Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify, 598 00:34:48,960 --> 00:34:54,000 Speaker 2: and at www dot Bloomberg dot com, slash podcast Slash Law, 599 00:34:54,440 --> 00:34:57,000 Speaker 2: and remember to tune into The Bloomberg Law Show every 600 00:34:57,040 --> 00:35:00,960 Speaker 2: weeknight at ten pm Wall Street Time. I'm June Grosso 601 00:35:01,080 --> 00:35:02,680 Speaker 2: and you're listening to Bloomberg. 602 00:35:03,760 --> 00:35:07,840 Speaker 4: Mhm.