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Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio.

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Speaker 2: It was a busy week at the Supreme Court. The

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Speaker 2: Justice has heard oral arguments in two high profile cases

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Speaker 2: over guns and the Internet, and they decided to take

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Speaker 2: up Donald Trump's bid for immunity from criminal prosecution, putting

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Speaker 2: his election interference trial on hold until the Court makes

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Speaker 2: a decision, perhaps as late as June. Trump's litigation strategy

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Speaker 2: of delay, delay, delay essentially gave him a victory. Here's

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Speaker 2: former federal prosecutor Robert Mintz.

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Speaker 3: One pactick in any defense team's playbook is to try

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Speaker 3: to delay. Here We've seen that done again and again

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Speaker 3: by former President Trump's lawyers, and it has special significance

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Speaker 3: here given the fact that there is an upcoming election,

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Speaker 3: and so the decision here as to whether and how

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Speaker 3: quickly Trump could god a trial is especially critical because

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Speaker 3: it could not only affect his election prospect, but should

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Speaker 3: he be reelected, it would actually affect the Department of

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Speaker 3: Justice ability to bring this case at all, since once

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Speaker 3: he's president, he could simply direct his attorney general to

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Speaker 3: dismiss the case that was penning against him. So it

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Speaker 3: has particular significance.

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Speaker 2: And like everything related to Trump, that decision seemed to

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Speaker 2: overshadow the cases the Court heard this week. On Monday,

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Speaker 2: during almost four hours of arguments, the justices grappled with

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Speaker 2: the new Republican backed laws in Texas and Florida that

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Speaker 2: bans social media platforms from removing content based on the

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Speaker 2: views expressed.

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Speaker 4: This is such an odd case for our usual jurisprudence.

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Speaker 4: It seems like your law is covering just about every

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Speaker 4: social media platform on the Internet. And we have a

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Speaker 4: meek guy who are not additional social media platforms like

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Speaker 4: smartphones and others who have submitted ANKI brief telling them

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Speaker 4: that readings of this law could cover them.

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Speaker 2: And several Justices echoed the concerns of Justice Sonya Sotomayor

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Speaker 2: about how the very broad laws might affect other sites

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Speaker 2: like Uber, Etsy, and Venmo. Here's Justice Amy Cony Barrett.

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Speaker 5: So Florida's law, so far as I can understand, it

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Speaker 5: is very broad, and we're talking about the classic social

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Speaker 5: media platforms, But it looks to me like it could

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Speaker 5: cover Uber. It looks to me like it could cover

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Speaker 5: just Google search engines, Amazon Web Service, and all of

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Speaker 5: those things would look very different, and Justice Sotomayor brought

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Speaker 5: up etsy.

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Speaker 2: Justices Samuel Alito and Clarence Thomas appeared most ready to

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Speaker 2: embrace arguments made by lawyers for the States characterizing social

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Speaker 2: media's content moderation as censorship.

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Speaker 6: Is it anything more than a euphemism for censorship?

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Speaker 7: I want to just ask you this, If somebody in

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Speaker 7: nineteen seventeen.

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Speaker 8: Was prosecuted and thrown in jail for opposing US participation

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Speaker 8: in World War One?

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Speaker 1: Was that content moderation?

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Speaker 2: Joining me is Eric Goleman, co director of the High

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Speaker 2: Tech Law Institute at Santa Clara University Law School. Eric

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Speaker 2: justice is on both sides of the ideological spectrum. We're

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Speaker 2: concerned about how broad these laws are and how they

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Speaker 2: could cover sites from et seed to Gmail.

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Speaker 8: Essentially, what Florida and Texas did is that they passed

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Speaker 8: laws that were tacked with over a dozen different ideas

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Speaker 8: in each and because of that complexity, it makes it

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Speaker 8: very hard to determine who's actually covered by the law

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Speaker 8: and what they're expected to do. And based on the

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Speaker 8: way that the cases got to the Supreme Court, some

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Speaker 8: of that wasn't fully clarified at the lower levels, and

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Speaker 8: so the justices were just wrestling with the pay of

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Speaker 8: the law that they couldn't figure out who's covered, what

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Speaker 8: it would actually require them to do, and therefore they

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Speaker 8: didn't even know how to evaluate the constitutionality of those provisions.

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Speaker 2: There were also a lot of questions about whether social

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Speaker 2: media platforms should be treated like common carriers such as

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Speaker 2: telephone companies. So are tech companies more like publishers or

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Speaker 2: public utilities.

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Speaker 8: I think that the real struggle was in how to

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Speaker 8: interplay a speech restriction, of which the laws contained several

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Speaker 8: with other legal principles like public accommodations, the idea that

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Speaker 8: companies should not discriminate against their customers based on certain

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Speaker 8: protected attributes, so other concepts like common carriage or public

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Speaker 8: utility doctrines. Those concept doctrines could be in play. But

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Speaker 8: the real struggle is that the court doesn't really know

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Speaker 8: how to think about how social media services differ from say,

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Speaker 8: a restaurant. Until they get to that basic understanding of

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Speaker 8: the different functions of social media services, they don't even

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Speaker 8: know how to categorize them.

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Speaker 2: And early in the arguments, Justice Cavanaugh emphasized to Florida

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Speaker 2: Solicitor General that the First Amendment only prevents governments from

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Speaker 2: restricting speech, not private businesses.

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Speaker 9: In your opening remarks, you said, the design of the

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Speaker 9: First Amendment is to prevent suppression of speech end quote,

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Speaker 9: and you left out what I understand to be three

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Speaker 9: key words in the First Amendment or to describe the

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Speaker 9: First Amendment by the government.

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Speaker 2: That seemed to be such a strong point, but then

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Speaker 2: it just disappeared from the arguments.

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Speaker 8: Justine Covanaugh really hammered that the First Amendment restricts how

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Speaker 8: governments act, not how private actors act. And when the

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Speaker 8: government tries to tell publishers how to act, that's a facial,

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Speaker 8: unambiguous First Amendment violation, no questions about it. For some reason,

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Speaker 8: he was pretty much the only voice making that point,

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Speaker 8: even though it seems so screamingly obvious. All the other

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Speaker 8: justices were struggling to get back to that basic point.

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Speaker 8: And so that makes me nervous because Justice Kavanaugh was

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Speaker 8: one hundred percent correct in that observation, and here was

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Speaker 8: almost like a lone voice on it.

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Speaker 2: I thought, coming into these arguments that there was no

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Speaker 2: way they would uphold either of these laws. Now I'm

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Speaker 2: not so sure.

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Speaker 8: Well, it's not a binary question, it's not do the

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Speaker 8: law survive or the laws fail. It could be the

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Speaker 8: parts of the law survive and parts of the law fail,

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Speaker 8: like in the Eleventh Circuit, some of the laws did

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Speaker 8: survive and other parts did not. So the Supreme Court

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Speaker 8: is quite likely to try to make some distinctions about

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Speaker 8: the different provisions and will be careful to try and

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Speaker 8: make sure that whatever they say on any of those

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Speaker 8: visions wouldn't affect some future legislature's freedom on different topic.

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Speaker 8: So then that effect is that it's possible that some

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Speaker 8: parts of the law will survive. And that's scary to

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Speaker 8: me because there was really no salagy in the law

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Speaker 8: at all either law. Both of them were so misguided

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Speaker 8: at their core that the idea that any peace in

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Speaker 8: the law might be okay is really just horrifying to me.

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Speaker 2: Well, if parts of the laws are allowed to go

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Speaker 2: into effect, that means we could have a landscape across

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Speaker 2: the country where different states have different rules about social media.

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Speaker 8: That's inevitable, that's already happening today. And that's a different

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Speaker 8: question for the Court that they acknowledged occasionally but weren't

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Speaker 8: prepared to deal with. It wasn't within the scope of

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Speaker 8: their review. But the entire idea of individual states coming

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Speaker 8: up with their own version of a social media service

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Speaker 8: and how they regulated just completely touch or diicts how

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Speaker 8: we think about the Internet and really how Internet law

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Speaker 8: can function in a meaningful way. So, you know, just

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Speaker 8: to be clear, there are provisions of both the Floor

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Speaker 8: and Texas laws that were not challenged, that are in

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Speaker 8: effect today that the states have chosen not yet to enforce.

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Speaker 8: So we are already living in a world where parts

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Speaker 8: of these laws are in effect, and whenever they're enforced,

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Speaker 8: if ever, we could see a radically different Internet. The

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Speaker 8: states are not likely to deploy those laws to advance

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Speaker 8: the interests of the Internet at large. They will do

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Speaker 8: so to advance the voters they're trying to impress.

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Speaker 2: Yeah, at one point there was a discussion about whether

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Speaker 2: Texas could be GEO fenced out.

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Speaker 8: Yeah, it's the weirdest message. The Texas lawyer basically said,

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Speaker 8: to get the f out of Texas. You don't want

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Speaker 8: to follow their rules. And if I'm a Texas social

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Speaker 8: media user, I'm going to be quite concerned about that position.

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Speaker 8: They're basically begging the social media service to change the

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Speaker 8: Internet for Texas, and I'm pretty sure that's not actually

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Speaker 8: what Texas voters want.

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Speaker 2: These cases are just at the ordinary injunction stage, So

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Speaker 2: could the justices just send this back, you know, for

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Speaker 2: trial and for more findings of fact.

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Speaker 8: That's the best case scenario for the social media services

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Speaker 8: is that the Supreme Court keeps the injunction in place,

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Speaker 8: or in the Texas case, restores the injunction that was

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Speaker 8: initially issued and then sends it back to the trial

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Speaker 8: courts to determine whether or not a permanent injunction is appropriate.

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Speaker 8: That's the best case scenario. That step would have to

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Speaker 8: happen no matter what if the law is going to

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Speaker 8: be struck down. But if the courts decide to affirm

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Speaker 8: some or all of the existing laws, they could simply

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Speaker 8: say injunction. Dissolved laws go into effect, and either the

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Speaker 8: social media services can never challenge it because they'll have

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Speaker 8: no merit, or at best, the social media services will

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Speaker 8: have to challenge only after they've been sued under the law.

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Speaker 8: And it's clearly social media services don't like that answer

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Speaker 8: because of the fact that they would then have to

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Speaker 8: build a compliance function and hope that they got it right,

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Speaker 8: or risk really quite devastating remedies. So the best scenario

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Speaker 8: is that we have further proceeds in this case at

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Speaker 8: the lower court to determine the permanent injunction. And the

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Speaker 8: worst case scenario is that the laws go into effect

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Speaker 8: as they're currently written, with the possibility of limited further challenges.

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Speaker 2: And how do you think the justices are going to

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Speaker 2: line up?

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Speaker 8: It wouldn't surprise me if three justices would vote to

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Speaker 8: support the Texas and Florida laws. That could be done

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Speaker 8: substantly or more likely on a procedural basis, simply saying

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Speaker 8: that they reject the facial challenge. That was Justice Thomas,

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Speaker 8: Justice Tolito, and Justice or such. After that, the other

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Speaker 8: six justices were kind of all over the map. I

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Speaker 8: heard some reservations about the laws and the likelihood that

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Speaker 8: some aspects were in constitutional, but I couldn't tell then

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Speaker 8: if that would support a procedural ruling on the legitimacy

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Speaker 8: of the facial challenge, or if there were a substance

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Speaker 8: of agreement about which of the pieces were going to

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Speaker 8: be unconstitutional. So I come away from the oral argument

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Speaker 8: really uncertain about the future of the cases, and also

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Speaker 8: frankly uncertain about the future of the Internet.

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Speaker 2: There's certainly a lot at stake here. Thanks so much, Eric.

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Speaker 2: That's Professor Eric Goldman, co director of the High Tech

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Speaker 2: Law Institute at Santa Clara University Law School. Coming up

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Speaker 2: next on the Bloomberg Law Show. The Justice is a

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Speaker 2: peer split over whether to uphold the federal ban on

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Speaker 2: bump stocks, and two justices from opposite ends of the

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Speaker 2: ideological divide make a public appearance together. We'll tell you why.

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Speaker 2: I'm June Grosso and you're listening to Bloomberg.

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Speaker 7: The Aichens accelerator at the original bumpstock shot at six

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Speaker 7: hundred and fifty rounds a minute, and the devices at

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Speaker 7: issue here are represented to shoot between four hundred and

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Speaker 7: eight hundred round a minute, so right in that range

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Speaker 7: with the sixteen the M fourteen.

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Speaker 2: Brian Fletcher, representing the Biden administration, explained to the Supreme

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Speaker 2: Court Justices on Wednesday that bump stocks turned semi automatic

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Speaker 2: rifles into weapons that fire at speeds comparable to machine

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Speaker 2: guns like the M sixteen and M fourteens used by

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Speaker 2: the military. The question is whether the justices will strike

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Speaker 2: down a ban on bump stocks that was imposed by

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Speaker 2: the Trump administration after the deadliest mass shooting in US

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Speaker 2: history in Las Vegas in twenty seventeen. The liberal justice is,

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Speaker 2: like Elena Kagan, seemed to think that the one hundred

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Speaker 2: year old law banning machine guns could also cover bump stocks.

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Speaker 10: The entire point of this device is that you exert

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Speaker 10: forward pressure and you have your finger on the trigger,

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Speaker 10: and then a torrent of bullets shoots out. So I

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Speaker 10: don't understand why it's any different different from pushing a

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Speaker 10: button and holding the trigger, pushing the barrel and holding

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Speaker 10: the trigger.

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Speaker 2: But conservative justice is like Amy Cony Barrett and Neil Gorsuch,

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Speaker 2: while seeming to acknowledge the danger of bomb stocks, question

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Speaker 2: whether banning the device is was up to the court.

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Speaker 5: It seems like, yes, this is functioning like a machine

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Speaker 5: gun would. But you know, looking at that definition, I

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Speaker 5: think the question is why didn't Congress pass that litigation,

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Speaker 5: I mean, that legislation to make this coverment more clearly.

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Speaker 6: I can certainly understand why these items should be made illegal,

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Speaker 6: but we're dealing with the statute as enacted in the

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Speaker 6: nineteen thirties, and through many administrations, the government took the

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Speaker 6: position that these bump stocks are not machine.

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Speaker 2: Guns, joining me is Andrew Willinger, executive director of the

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Speaker 2: Duke Center for Firearms Law. Andrews start by giving us

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Speaker 2: a little bit of the history of the federal ban

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Speaker 2: on bomb stocks.

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Speaker 11: So, this is.

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Speaker 12: An ATF regulation that categorizes bombstock devices as machine guns

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Speaker 12: under the National Firearms Act, and so therefore those devices

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Speaker 12: are banned. This regulation was promulgated after the twenty seventeen

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Speaker 12: Las Vegas shooting, the deadliest mass shooting in US history,

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Speaker 12: where the shooter used bump stocks. And after that shooting,

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Speaker 12: there was some discussion about whether Congress might act through

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Speaker 12: legislation to specifically say that, you know, bump stocks are

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Speaker 12: prohibited or bump stocks are machine guns, and ultimately that

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Speaker 12: did not happen. Instead, the ATF under the Trump administration

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Speaker 12: promulgated this regulation. And you know, it's I guess worth

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Speaker 12: noting here that the ATF has sort of had, in

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Speaker 12: the previous decade or so gone back and forth on

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Speaker 12: how it categorized them in informal guidance to the industry.

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Speaker 12: These sort of letters that the ATF would send to

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Speaker 12: companies that were making bump stocks, occasionally saying that some

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Speaker 12: of these devices were not machine guns and could be

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Speaker 12: produced and sold, and so this regulation in twenty eighteen

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Speaker 12: kind of settled that matter. But again it's the culmination

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Speaker 12: of a little bit of a back and forth from

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Speaker 12: the ATF.

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Speaker 2: So this isn't about the Second Amendment. Then, it's about

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Speaker 2: the reach of this federal statute and how the ATF

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Speaker 2: interpreted it.

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Speaker 12: Yeah, exactly, it's a little bit complicated. It's not, I

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Speaker 12: guess to start.

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Speaker 2: It's a lot complicated.

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Speaker 11: Yeah, the justices certainly, I think you're struggling with this

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Speaker 11: one as well. So to start, you know, you're right,

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Speaker 11: it's not a Second Amendment case. That's been pretty clear

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Speaker 11: from the get go. This is really, as I see

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Speaker 11: it at this.

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Speaker 12: Point, really a pure statutory interpretation question. And then the

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Speaker 12: question is whether the ATFS interpretation of machine gun to

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Speaker 12: include bump stocks was in accord with the statute, with

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Speaker 12: what the statute mean, what the intent was when the

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Speaker 12: statute was written. So for that reason, the arguments that

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Speaker 12: we heard are really focused on just this question of

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Speaker 12: what does the relevant statutory language single function of the

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Speaker 12: trigger automatically, what do those words mean?

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Speaker 2: I have to say I found these arguments so confusing,

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Speaker 2: with the justices seeming to struggle over the technical aspects

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Speaker 2: of bump stocks over you know, are you're pushing a button,

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Speaker 2: are you pulling? Are you exerting pressure on it? Why

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Speaker 2: was that important?

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Speaker 11: Yeah?

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Speaker 12: I mean yeah, there was a lot of confusion and

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Speaker 12: a lot of hypothetical you know, revolving around buttons and

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Speaker 12: trip wires and those types of things. But I think

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Speaker 12: ultimately the issue sort of reduces to the perspective from

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Speaker 12: which you view this phrase single function of the trigger.

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Speaker 12: So the government's argument really just boiled down, is that

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Speaker 12: single function of the trigger really means single pull of

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Speaker 12: the trigger. So you're focused on the act of the

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Speaker 12: shooter and what the shooter does in pulling the trigger,

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Speaker 12: and that because that pull of the trigger initiates the

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Speaker 12: bump firing sequence when you're using a bump stock, that

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Speaker 12: therefore the gun is firing multiple rounds with a single

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Speaker 12: function of the trigger. Cargill, on the other hand, says,

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Speaker 12: you don't look at this from the perspective of the shooter. Instead,

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Speaker 12: you're looking at the actual mechanical function of the trigger.

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Speaker 12: What does the trigger of the gun do? And the

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Speaker 12: way again, according to Cargo's argument and the way that

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Speaker 12: that works is that when you are bump firing a

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Speaker 12: STEMI automatic weapon, the trigger still has to go back

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Speaker 12: and forth, and only one round is expelled each time

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Speaker 12: the trigger goes back and forth. It just happens very quickly.

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Speaker 2: The court's liberals seem to suggest that bump stocks fell

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Speaker 2: within what Congress intended when it banned machine guns, and

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Speaker 2: particularly Justice Elena Kagan went at this over and over

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Speaker 2: again with Cargo's attorney, and you know, appeared incredulous that

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Speaker 2: a weapon that can fire a torrent of bullets could

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Speaker 2: not be defined as a machine gun.

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Speaker 12: That's what I detected from Justice Kagan, probably Justice Jackson,

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Speaker 12: maybe Justice Soda Mayor, with sort of this maybe consequentialist

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Speaker 12: approach to this statute, which is, well, how does it

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Speaker 12: make any sense to read the statue to exclude from

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Speaker 12: its scope devices that would allow you to achieve the

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Speaker 12: same high rate of fire as you know, a machine

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Speaker 12: gun like the sixteen for example, Right in their view,

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Speaker 12: I think that seems that something of an absurd result

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Speaker 12: given the evidence about the National Firearms Act and what

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Speaker 12: the congressional intent was there.

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Speaker 2: So it seemed like several conservatives were acknowledging that it's

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Speaker 2: functioning like a machine gun. So Justice is Barrett and

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Speaker 2: Gorsich said words to that effect. Then the buts came

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Speaker 2: and they both thought that this is something that Congress

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Speaker 2: should do.

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Speaker 12: Yeah, I think that's right. I think they thought that

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Speaker 12: this is something Congress should do that cannot be accomplished

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Speaker 12: through regulation. And I also think there was a strong view,

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Speaker 12: you know, among some of the conservative justices, Justice Gorsas,

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Speaker 12: just as Kavanaugh, maybe Justice Alito, that they were very

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Speaker 12: concerned about the potential confusion and the potential for sort

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Speaker 12: of people who own these devices to be kind of

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Speaker 12: almost trapped, right and be like, well that they're not

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Speaker 12: sure what the legal status is and yet that they

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Speaker 12: could be prosecuted criminally for having these devices. And so

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Speaker 12: a lot of concern about sort of what the practical

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Speaker 12: impact of this rule would be on people who have

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Speaker 12: owned bump stock devices at various points in time.

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Speaker 2: I thought that was a ridiculous concern. Would people be

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Speaker 2: so confused if the ATF said bump stocks are now illegal?

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Speaker 2: I mean, laws change. Ask the Supreme Court about abortion.

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Speaker 12: Maybe the key point here is that, actually, I don't

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Speaker 12: know how much this matters. And there were a few

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Speaker 12: justices who pressed the government attorney on this issue. The

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Speaker 12: government is not really bringing criminal prosecutions as far as

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Speaker 12: I know of those who have possessed bump stock devices, right,

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Speaker 12: And I would suspect that they wouldn't do that until

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Speaker 12: this litigation sort of resolved. And cerly, this issue is

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Speaker 12: not unique to bump stocks. Right. Frequently circuits disagree on

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Speaker 12: various issues of criminal law. Right, that doesn't mean that

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Speaker 12: criminal penalties can't be invoked.

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Speaker 2: So what's your best guess as to how this will

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Speaker 2: come out?

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Speaker 12: Again, this is not a Second Amendment case. It of

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Speaker 12: course involves firearms and firearm accessories, but it's not a

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Speaker 12: Second Amendment case. And that might initially lead one to think, well,

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Speaker 12: maybe the justices will break down differently right than they

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Speaker 12: have in their most recent Second Amendment decisions. After listening

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Speaker 12: to the argument, I'm not so sure that's true. I

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Speaker 12: think you can pretty confidently say that you know Justices Soda, Mayor, Kagan,

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Speaker 12: and Jackson, they're probably on the side of the government here.

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Speaker 12: Justice Alito, Justice Kavanaugh, Justice Gorsuch, and probably Justice Thomas.

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Speaker 12: I would guess it seems a little bit more sympathetic

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Speaker 12: to Cargill's position. So then you have, of course, Justice

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Speaker 12: Barrett and Chief Justice who are sort of up in

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Speaker 12: the air, and the Chief Justice didn't say a whole

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Speaker 12: lot during oral arguments. Putting all that together, I expect

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Speaker 12: this to be a very close case. It's potentially a

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Speaker 12: five four decision. I'm not really sure which way it

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Speaker 12: will go. You have those same justices Barrett and Roberts

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Speaker 12: that are kind of the key votes in the second

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Speaker 12: Amendment area, also being the key votes here.

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Speaker 2: Such an important case. Thanks Andrew. That's Andrew Willinger, Executive

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Speaker 2: director of the Duke Center for Firearms Law. A note.

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Speaker 2: Michael Bloomberg, the founder majority owner of Bloomberg LP, the

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Speaker 2: parent company of Bloomberg Radio, is a donor to groups

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Speaker 2: that support gun control, including every Town for Gun Safety Now.

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Speaker 2: While the justices were exhibiting division on the bench during

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Speaker 2: oral arguments this week, two justices from opposite ends of

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Speaker 2: the ideological spectrum appeared on stage side by side at

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Speaker 2: the National Governors Association in DC last Friday to talk

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Speaker 2: about how well the justices get along. But the main

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Speaker 2: message from liberal Justice Sonya Sotomayor and conservative Justice Amy

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Speaker 2: Cony Barrett seemed to be that the justices are not

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Speaker 2: beholden to the presidents who appointed them.

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Speaker 4: And remember, thankfully, for us, presidents don't last that long, right,

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Speaker 4: there's eight years, So for us to be behold into

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Speaker 4: one of them is a little crazy.

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Speaker 10: Right.

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Speaker 5: It's not just that we're not Obama judges and Trump judges,

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Speaker 5: but we're also not Democratic judges or Republican judges. We

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Speaker 5: don't sit on opposite sides of an aisle. We all

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Speaker 5: wear the same color black robe. We don't have red,

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Speaker 5: red robes and blue robes.

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Speaker 2: Joining me is constitutional law expert David super, a professor

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Speaker 2: at Georgetown Law School. So was the point to tell

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Speaker 2: the country that they get along and play well together

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Speaker 2: or something else.

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Speaker 1: The point is to salvage the Supreme Court as a

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Speaker 1: unifying institution, an institution relevant to all of us. And

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Speaker 1: participating in that effort was one of the few things

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Speaker 1: that Justice Soda Mayor can do to make herself relevant,

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Speaker 1: given how heavily outvoted.

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Speaker 2: The biggest message to me was that they're not beholden

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Speaker 2: to the presidents that appointed them or to the president's party.

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Speaker 2: Barrett said, we're not Obama judges or Trump judges. We're

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Speaker 2: not Democratic judges or Republican judges, but she left out

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Speaker 2: we are liberal judges and conservative judges.

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Speaker 1: This is damage control for a court whose image has

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Speaker 1: been badly harmed. You saw the same sort of thing

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Speaker 1: in the early two thousands after Bush vy Gore and

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Speaker 1: some of the Democratic justices then after several months had passed,

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Speaker 1: started giving speeches that the court works well together and

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Speaker 1: people should still respect the court. And I think after

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Speaker 1: the damage that Dobbs and grun and some of these

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Speaker 1: other high profile cases, the Affervative Action case have done

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Speaker 1: to the image of a court as an impartial finder

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Speaker 1: of legal truths, that they feel some need to do this.

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Speaker 1: Chief Justice Roberts has been doing it for a long time,

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Speaker 1: and I suspect he's encouraged other justices to join in.

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Speaker 2: We'll see if the public's opinion of the Court plummets

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Speaker 2: any lower after this term's decisions on guns, the abortion pill,

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Speaker 2: social media, and the like. Thanks so much, David. That's

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Speaker 2: Professor David super of Georgetown Law School. Coming up next.

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Speaker 2: Might Donald Trump be facing another lawsuit, this time over

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Speaker 2: his new sneakers with those bright red souls. I'm June Gross.

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Speaker 2: When you're listening to Bloomberg, that's.

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Speaker 12: The real deal. That's the real deal.

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Speaker 2: Donald Trump launched his Never Surrender high Top sneakers at

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Speaker 2: sneaker Con last week, a limited edition selling for three

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Speaker 2: hundred and ninety nine dollars.

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Speaker 4: You know, I've wanted to do this for a long time.

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Speaker 1: I have some incredible people that work with me on things,

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Speaker 1: and they came up with this, And this is something.

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Speaker 10: I've been talking about for twelve.

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Speaker 9: Years, thirteen years, and I think it's going.

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Speaker 4: To be a big success.

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Speaker 2: It didn't take long for the garish goal sneakers were

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Speaker 2: the stars and stripes designed around the ankle and a

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Speaker 2: huge letter T on the side to be mocked, including

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Speaker 2: a skit on Saturday Night Live.

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Speaker 12: In terms of basketball movie vestiche and with regard to shoes,

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Speaker 12: I think we've done a wonderful boittmn Karen.

441
00:25:18,600 --> 00:25:21,320
Speaker 2: But it's the bright red souls on the sneakers that

442
00:25:21,400 --> 00:25:26,000
Speaker 2: have lawyers talking. Is luxury brand Christian le Bouton, known

443
00:25:26,040 --> 00:25:30,440
Speaker 2: for its iconic red souls, going to sue for trademark infringement.

444
00:25:30,960 --> 00:25:33,880
Speaker 2: Joining me is Susan Scaffiti, director of the Fashion Law

445
00:25:33,960 --> 00:25:38,520
Speaker 2: Institute at Fordham Law School. So these Never Surrender high

446
00:25:38,520 --> 00:25:42,520
Speaker 2: Top sneakers, which are gold Trump's favorite color apparently, but

447
00:25:42,760 --> 00:25:47,560
Speaker 2: with those bright red souls screams I'm a Christian leu

448
00:25:47,640 --> 00:25:48,600
Speaker 2: button sneaker.

449
00:25:49,800 --> 00:25:54,040
Speaker 13: Yes it does. And I have a feeling that maybe

450
00:25:54,040 --> 00:25:56,320
Speaker 13: there were a few trademark layers who had a hand

451
00:25:56,359 --> 00:26:00,760
Speaker 13: in this shoe because it screams Lobotomata pulls back a

452
00:26:00,800 --> 00:26:04,320
Speaker 13: little bit, says, yes, I'm Libaton, but not quite in

453
00:26:04,520 --> 00:26:09,159
Speaker 13: part because the Lebaton trademark, as registered is actually for

454
00:26:09,240 --> 00:26:12,720
Speaker 13: women's shoes only. Also, you see the way on the

455
00:26:12,920 --> 00:26:17,040
Speaker 13: side of the Trump shoe the red outsole bleeds up

456
00:26:17,200 --> 00:26:20,200
Speaker 13: a little bit onto the white foxing along the side

457
00:26:20,200 --> 00:26:23,200
Speaker 13: of the shoe, And I think that's because in the

458
00:26:24,080 --> 00:26:28,320
Speaker 13: landmark lawsuit, when La and Libata were in court together

459
00:26:28,359 --> 00:26:30,760
Speaker 13: here in New York, if the trademark ultimately ended up

460
00:26:30,800 --> 00:26:34,119
Speaker 13: being modified, Now that trademark was about an all red

461
00:26:34,200 --> 00:26:37,000
Speaker 13: shoe with a red upper and a red outsole, that

462
00:26:37,040 --> 00:26:40,080
Speaker 13: the law had done. But the ultimate result of that

463
00:26:40,200 --> 00:26:44,919
Speaker 13: lawsuit was that the Loboton trademark was modified so that

464
00:26:45,000 --> 00:26:48,439
Speaker 13: there must be a contrast between the outsole and the upper.

465
00:26:48,800 --> 00:26:51,560
Speaker 13: So maybe some clever trademark lawyers thought, well, if the

466
00:26:51,640 --> 00:26:53,840
Speaker 13: red bleeds over a little bit, we could at least

467
00:26:53,920 --> 00:26:57,680
Speaker 13: argue that there's not contrast, and we could argue that

468
00:26:57,720 --> 00:27:01,720
Speaker 13: the registration is technically for women's although that's not really

469
00:27:01,760 --> 00:27:05,160
Speaker 13: smart thinking, because of course there's a common law trademark

470
00:27:05,200 --> 00:27:08,480
Speaker 13: in the US, and since Blebaton is so associated with

471
00:27:08,640 --> 00:27:12,920
Speaker 13: red soles on shoes, including now for mens, including his own,

472
00:27:13,200 --> 00:27:15,399
Speaker 13: even though at the time he originally registered in the

473
00:27:15,480 --> 00:27:17,960
Speaker 13: US he did very few mens. I think that Libertont,

474
00:27:18,240 --> 00:27:21,560
Speaker 13: if it cared to take action, would in fact have

475
00:27:21,640 --> 00:27:22,680
Speaker 13: a pretty good case.

476
00:27:22,920 --> 00:27:25,800
Speaker 2: And Nike might also be looking at these Trump sneakers.

477
00:27:25,960 --> 00:27:30,600
Speaker 13: Well, you know, lo Baton is the first glaring trademark reference,

478
00:27:30,720 --> 00:27:33,880
Speaker 13: shall we say, kind of reference to luxury in those shoes.

479
00:27:33,920 --> 00:27:36,320
Speaker 13: But you know, the silhouette is an awful lot like

480
00:27:36,359 --> 00:27:40,040
Speaker 13: the Nike Air Force one Nudgwink Air Force one. So

481
00:27:40,080 --> 00:27:43,640
Speaker 13: there's a lot going on here. And while Nike does

482
00:27:43,720 --> 00:27:47,080
Speaker 13: have trade dress registration on some elements of the Air

483
00:27:47,080 --> 00:27:49,280
Speaker 13: Force one, including the Air Force one high tops that

484
00:27:49,359 --> 00:27:52,240
Speaker 13: these resemble, I again think there might have been a

485
00:27:52,280 --> 00:27:55,520
Speaker 13: trademark lawyer in the design room saying, you know, maybe

486
00:27:55,720 --> 00:27:58,680
Speaker 13: move those panels just a little bit, maybe don't do

487
00:27:58,800 --> 00:28:02,080
Speaker 13: too many vertical line down along the base of the

488
00:28:02,119 --> 00:28:04,639
Speaker 13: foxing at the bottom of the shoe, just before it

489
00:28:04,640 --> 00:28:07,560
Speaker 13: touches the ground. Maybe make sure you don't use the

490
00:28:07,920 --> 00:28:11,920
Speaker 13: wavy leather brackets that hold the islets for the shoelaces

491
00:28:11,960 --> 00:28:14,479
Speaker 13: that are so classic and associated with the Nike Air

492
00:28:14,520 --> 00:28:17,800
Speaker 13: Force One. And yet for a sneaker officionado looking at

493
00:28:17,800 --> 00:28:22,480
Speaker 13: that silhouette, it does have that reference, especially because the

494
00:28:22,520 --> 00:28:26,080
Speaker 13: flaglike imagery around the top, it also feels like a

495
00:28:26,160 --> 00:28:28,080
Speaker 13: reference to the band around the top of an air

496
00:28:28,080 --> 00:28:31,400
Speaker 13: Force one. So overall, I can't imagine that Nike would

497
00:28:31,400 --> 00:28:34,400
Speaker 13: be happy. They wouldn't necessarily have quite a strong trademark

498
00:28:34,440 --> 00:28:39,000
Speaker 13: claim as Lobaton, but I think that certainly it crossed

499
00:28:39,040 --> 00:28:41,840
Speaker 13: a desk at Nike, the desk in the legal department.

500
00:28:42,040 --> 00:28:44,480
Speaker 2: The little difference is, let's say, the way the red

501
00:28:44,560 --> 00:28:47,200
Speaker 2: goes up the side. Do those make that much of

502
00:28:47,240 --> 00:28:51,080
Speaker 2: a difference in a lawsuit because most people just look, oh,

503
00:28:51,120 --> 00:28:52,040
Speaker 2: it's got a red soule.

504
00:28:52,560 --> 00:28:54,800
Speaker 13: Well, it moves us from the realm of a straight

505
00:28:54,880 --> 00:28:58,400
Speaker 13: up counterfeit, where we have something that is nearly orbidentially

506
00:28:58,520 --> 00:29:02,520
Speaker 13: identical to the realm of potential infringement. But because there

507
00:29:02,680 --> 00:29:06,920
Speaker 13: is that generalized test in trademark? Is there a likelihood

508
00:29:06,920 --> 00:29:10,680
Speaker 13: of consumer confusion? Might some consumers think that this was

509
00:29:10,720 --> 00:29:14,120
Speaker 13: a deal between Donald Trump and Lobaton? That test to

510
00:29:14,200 --> 00:29:16,920
Speaker 13: consumer confusion is what we'll control. And I think a

511
00:29:17,000 --> 00:29:19,600
Speaker 13: consumer could absolutely be confused as to whether or not

512
00:29:19,720 --> 00:29:22,600
Speaker 13: this was a licensed product, or whether or not perhaps

513
00:29:22,640 --> 00:29:25,960
Speaker 13: even Lobaton was endorsing Trump, which of course could be

514
00:29:26,040 --> 00:29:29,280
Speaker 13: very controversial, both for the company itself and for the

515
00:29:29,360 --> 00:29:33,360
Speaker 13: designer himself, but also for consumers who love their movies.

516
00:29:33,680 --> 00:29:38,640
Speaker 2: And apparently some social media users were commenting on Instagram.

517
00:29:39,120 --> 00:29:42,440
Speaker 2: One said, please, please please sue Donald Trump for infringing

518
00:29:42,480 --> 00:29:46,240
Speaker 2: on your Red Soul trademark. Another said, you licensed your

519
00:29:46,320 --> 00:29:49,320
Speaker 2: trademark Red Soul? Do that want to be blank?

520
00:29:49,520 --> 00:29:53,239
Speaker 13: It's the comment about licensing that is of more concern. Right,

521
00:29:53,600 --> 00:29:57,360
Speaker 13: sue him? Does not show consumer confusion? Hey, how dare

522
00:29:57,400 --> 00:29:59,880
Speaker 13: you license to him? Is of more concern from a

523
00:30:00,080 --> 00:30:03,200
Speaker 13: legal perspective. And you know, there is an instance in

524
00:30:03,240 --> 00:30:06,400
Speaker 13: the past when Cristan Lebotant went after a right wing

525
00:30:06,480 --> 00:30:10,760
Speaker 13: Belgian politician, a woman who was wearing his Red Soul regularly,

526
00:30:10,880 --> 00:30:15,600
Speaker 13: but most importantly for purposes of his complaint on posters

527
00:30:15,640 --> 00:30:19,920
Speaker 13: and ads that were targeting Muslim immigrants to Belgium. In

528
00:30:19,960 --> 00:30:23,320
Speaker 13: that case, it was the actual Lobatont product showing up

529
00:30:23,400 --> 00:30:26,400
Speaker 13: in her political ads and in her political statements, and

530
00:30:26,480 --> 00:30:29,920
Speaker 13: so it was an even closer connection. Still, he seems

531
00:30:29,960 --> 00:30:33,959
Speaker 13: to have been willing to wade into a fight before

532
00:30:34,280 --> 00:30:37,400
Speaker 13: in occasion which a politician tried to associate with the

533
00:30:37,440 --> 00:30:39,160
Speaker 13: Red Souls without his permission.

534
00:30:39,600 --> 00:30:42,719
Speaker 2: So that would be a business decision whether or not

535
00:30:42,840 --> 00:30:47,040
Speaker 2: you want to go after Trump and possibly get the

536
00:30:47,080 --> 00:30:50,640
Speaker 2: backlash that people who go after Trump often do. But

537
00:30:50,720 --> 00:30:54,120
Speaker 2: on the other hand, do you want your shoes associated

538
00:30:54,160 --> 00:30:54,680
Speaker 2: with Trump?

539
00:30:55,040 --> 00:30:58,080
Speaker 13: Absolutely, at one level it's a trademark decision. You don't

540
00:30:58,120 --> 00:31:02,080
Speaker 13: want your Red Soul to just be a generic indicator

541
00:31:02,080 --> 00:31:05,160
Speaker 13: of luxury, a shorthand for a minor product, and so

542
00:31:05,320 --> 00:31:08,520
Speaker 13: from a trademark perspective, to avoid becoming generic, you do

543
00:31:08,680 --> 00:31:11,640
Speaker 13: have to engage in a certain amount of policing. But yes,

544
00:31:11,760 --> 00:31:14,000
Speaker 13: at the level of a business decision, you have to

545
00:31:14,040 --> 00:31:17,560
Speaker 13: decide do you dare offend Trump supporters or are you

546
00:31:17,640 --> 00:31:21,080
Speaker 13: more concerned about Trump opponents starting to boycott your shoe

547
00:31:21,080 --> 00:31:24,040
Speaker 13: if they believe that there's a connection. And there's these

548
00:31:24,160 --> 00:31:27,440
Speaker 13: additional concern in terms of a business decision of how

549
00:31:27,520 --> 00:31:30,600
Speaker 13: much attention do you want to draw to these sneakers

550
00:31:30,720 --> 00:31:34,120
Speaker 13: that were apparently a limited edition, one undone. If you

551
00:31:34,200 --> 00:31:37,080
Speaker 13: think he might do it again, maybe you're more likely

552
00:31:37,200 --> 00:31:39,840
Speaker 13: to file a lawsuit or at least send a season

553
00:31:39,880 --> 00:31:42,200
Speaker 13: to this letter. But if you think it might just

554
00:31:42,360 --> 00:31:45,320
Speaker 13: be a quick hit in the media and something that

555
00:31:45,360 --> 00:31:48,440
Speaker 13: disappears in the public consciousness, do you want to be

556
00:31:48,520 --> 00:31:52,400
Speaker 13: the entity keeping those red souls in the public consciousness,

557
00:31:52,560 --> 00:31:57,720
Speaker 13: therefore underscoring the association between your brand and the politician.

558
00:31:58,200 --> 00:32:02,280
Speaker 2: What does lou Baiton lose if they don't sue over

559
00:32:02,320 --> 00:32:04,840
Speaker 2: the sneakers? Does their mark get watered down?

560
00:32:05,320 --> 00:32:07,840
Speaker 13: Sure, there's a potential for a dilution of the mark.

561
00:32:07,960 --> 00:32:10,400
Speaker 13: That is to say, now when we see a red soul,

562
00:32:10,480 --> 00:32:13,800
Speaker 13: we automatically think leubatont or do we think what it

563
00:32:13,880 --> 00:32:16,200
Speaker 13: could be libtont or it could be Trump. And that's

564
00:32:16,240 --> 00:32:19,200
Speaker 13: the key to dilutions. So they worry about dilution of

565
00:32:19,240 --> 00:32:22,200
Speaker 13: the strength of that mark, and they worry about ultimately

566
00:32:22,280 --> 00:32:24,640
Speaker 13: if they allow this one, then the next one and

567
00:32:24,720 --> 00:32:27,920
Speaker 13: the next one that happen the red Soul mark actually

568
00:32:27,960 --> 00:32:31,760
Speaker 13: becoming generic and the mark actually dying. We refer to

569
00:32:31,800 --> 00:32:35,280
Speaker 13: the concept of genericide right. Becoming generic can kill a

570
00:32:35,360 --> 00:32:38,920
Speaker 13: mark because it's no longer serving as a source indicator

571
00:32:38,960 --> 00:32:42,560
Speaker 13: to consumers. It's no longer a red flag telling consumers, hey,

572
00:32:42,720 --> 00:32:45,320
Speaker 13: this is in the best possible way, a red flag.

573
00:32:45,480 --> 00:32:48,240
Speaker 13: This is definitely a libtant because you see the red soul.

574
00:32:48,560 --> 00:32:51,760
Speaker 2: Let's say Lebton does sue. Would it be for trademark

575
00:32:51,840 --> 00:32:54,000
Speaker 2: infringement or trademark dilution?

576
00:32:54,720 --> 00:32:57,719
Speaker 13: It could be for both trademark infringement and trademark dilution.

577
00:32:58,200 --> 00:33:00,840
Speaker 2: And who do you think would have the better case

578
00:33:00,920 --> 00:33:03,160
Speaker 2: in court? I mean, is there a chance that Lewton

579
00:33:03,240 --> 00:33:03,760
Speaker 2: could lose.

580
00:33:04,160 --> 00:33:06,440
Speaker 13: There's always a chance. You never know what you're going

581
00:33:06,480 --> 00:33:09,400
Speaker 13: to get going into court. On the other hand, Lebton

582
00:33:09,440 --> 00:33:12,320
Speaker 13: has a very solid footprint with this trademark, and so

583
00:33:12,560 --> 00:33:15,760
Speaker 13: I think that in a kickboxing match with these shoes,

584
00:33:15,800 --> 00:33:17,840
Speaker 13: I would think that Lebton may very well come out

585
00:33:17,880 --> 00:33:18,200
Speaker 13: on top.

586
00:33:18,840 --> 00:33:20,720
Speaker 2: I assume it also just does it want to be

587
00:33:20,720 --> 00:33:25,840
Speaker 2: associated with that garish, clunky gold sneaker in terms.

588
00:33:25,600 --> 00:33:28,560
Speaker 13: Of reputational concern, Yes, you absolutely don't want to be

589
00:33:28,600 --> 00:33:32,040
Speaker 13: associated with something that you find distasteful, not only because

590
00:33:32,080 --> 00:33:35,040
Speaker 13: of the individual it might be associated with, but because

591
00:33:35,080 --> 00:33:38,320
Speaker 13: of the style itself or lack thereof, they are indeed

592
00:33:38,560 --> 00:33:39,320
Speaker 13: quite dramatic.

593
00:33:39,440 --> 00:33:41,520
Speaker 2: You're so nice to put it that way, Susan.

594
00:33:43,280 --> 00:33:46,360
Speaker 13: Well, then there's a question of the quasi flag iconography

595
00:33:46,480 --> 00:33:50,880
Speaker 13: as well, which actually is an interesting problem because the

596
00:33:50,960 --> 00:33:54,760
Speaker 13: US has law on the books about disrespect or disparagement

597
00:33:54,840 --> 00:33:57,200
Speaker 13: of the flag. Technically, you're not supposed to use the

598
00:33:57,200 --> 00:34:00,800
Speaker 13: flag in advertising. In fact, the Trademark Office won't register

599
00:34:00,920 --> 00:34:04,520
Speaker 13: a trademark that include the flag. Now, obviously there's not

600
00:34:04,720 --> 00:34:07,160
Speaker 13: actually a flag on the shoes, just a nod to

601
00:34:07,280 --> 00:34:10,080
Speaker 13: the flag with a handful of stars and stripes. But

602
00:34:10,400 --> 00:34:14,120
Speaker 13: even though First Amendment law has, oh my goodness, in

603
00:34:14,200 --> 00:34:19,000
Speaker 13: the last fifty years, prevented enforcement of any kind of

604
00:34:19,160 --> 00:34:22,720
Speaker 13: law that would hemalize anyone for putting a flag on clothing,

605
00:34:22,880 --> 00:34:25,120
Speaker 13: or putting a flag on shoes where it might be

606
00:34:25,239 --> 00:34:29,600
Speaker 13: dirtied or damaged or otherwise disparage. Nevertheless, you're walking a

607
00:34:29,640 --> 00:34:32,480
Speaker 13: fine line when you decide to put a flag or

608
00:34:32,520 --> 00:34:34,920
Speaker 13: something that looks like a flag somewhere that might be

609
00:34:35,000 --> 00:34:36,560
Speaker 13: considered disrespectful.

610
00:34:37,200 --> 00:34:40,040
Speaker 2: So do you think that Leubaton will at least send

611
00:34:40,080 --> 00:34:42,279
Speaker 2: a season assist letter, I.

612
00:34:42,200 --> 00:34:45,719
Speaker 13: Would hope so. Unfortunately, one of the concerns for Lebaton

613
00:34:46,040 --> 00:34:48,960
Speaker 13: is if Lebaton send a season to this letter, it

614
00:34:49,000 --> 00:34:51,920
Speaker 13: will immediately be posted. And so it comes back to

615
00:34:51,960 --> 00:34:54,400
Speaker 13: the question of do we think Trump will do this

616
00:34:54,520 --> 00:34:57,320
Speaker 13: again or do we think Trump's licensee will do this again?

617
00:34:57,520 --> 00:34:59,560
Speaker 13: And how much attention do we want to draw to

618
00:34:59,600 --> 00:35:01,560
Speaker 13: this If it was indeed a one and done At

619
00:35:01,600 --> 00:35:02,520
Speaker 13: Sneaker con.

620
00:35:02,600 --> 00:35:07,120
Speaker 2: The company has left itself an out because purchasers of

621
00:35:07,200 --> 00:35:10,960
Speaker 2: the sneakers may not actually get red Soul sneakers when

622
00:35:11,000 --> 00:35:14,200
Speaker 2: their order arrives in July. On the website it says

623
00:35:14,480 --> 00:35:18,399
Speaker 2: the images shown are for illustration purposes only and may

624
00:35:18,440 --> 00:35:21,839
Speaker 2: not be an exact representation of the product. So that

625
00:35:21,920 --> 00:35:24,120
Speaker 2: leaves them room to get rid of the red Souls.

626
00:35:24,880 --> 00:35:27,319
Speaker 13: It does now if they were to do that, and

627
00:35:27,560 --> 00:35:29,719
Speaker 13: particularly they were forced to do that to be a

628
00:35:29,760 --> 00:35:33,680
Speaker 13: legal action, I think some consumers would be upset because

629
00:35:33,719 --> 00:35:36,440
Speaker 13: they're not getting what was pictured and what was promised.

630
00:35:36,560 --> 00:35:40,360
Speaker 13: That's not a minor change, that's a significance stylistic change.

631
00:35:40,480 --> 00:35:44,480
Speaker 13: But nevertheless, they have indeed left themselves technically a legal out.

632
00:35:44,800 --> 00:35:47,440
Speaker 13: But of course if the purpose of these sneakers is

633
00:35:47,480 --> 00:35:50,680
Speaker 13: in part to court your audience, and to court the

634
00:35:50,719 --> 00:35:56,040
Speaker 13: audience of sneakerheads, a young, male, more urban audience. Then

635
00:35:56,280 --> 00:36:00,520
Speaker 13: you absolutely don't want to undermine that, essentially at advertising

636
00:36:00,640 --> 00:36:03,759
Speaker 13: or campaign effort, by making your customer to angry when

637
00:36:03,760 --> 00:36:06,680
Speaker 13: they receive issues. You don't want lots of negative publicity

638
00:36:06,760 --> 00:36:09,200
Speaker 13: following on the initial release of issue.

639
00:36:09,360 --> 00:36:13,680
Speaker 2: Thanks so much, Susan. It's always an informative and fun conversation.

640
00:36:14,239 --> 00:36:17,360
Speaker 2: That's Susan Scaffiti, a professor at Fordham Law School and

641
00:36:17,480 --> 00:36:20,799
Speaker 2: director of the Fashion Law Institute. And that's it for

642
00:36:20,840 --> 00:36:23,839
Speaker 2: this edition of the Bloomberg Law Podcast. Remember you've can

643
00:36:23,920 --> 00:36:26,880
Speaker 2: always get the latest legal news by subscribing and listening

644
00:36:26,880 --> 00:36:30,560
Speaker 2: to the show on Apple Podcasts, Spotify and at Bloomberg

645
00:36:30,640 --> 00:36:34,680
Speaker 2: dot com, slash podcast, slash Law. I'm June Grosso and

646
00:36:34,800 --> 00:36:36,080
Speaker 2: this is Bloomberg