WEBVTT - How Strong Is the Case Against Alec Baldwin ? 0:00:00.120 --> 0:00:01.840 Do. I take the gun and I start to cock 0:00:01.920 --> 0:00:04.080 the gun. I'm not going to pull the trigger. I said, 0:00:04.080 --> 0:00:05.640 do you see that? She will just cheat it down 0:00:05.640 --> 0:00:07.120 and tilt it down a little bit like that. And 0:00:07.120 --> 0:00:09.040 I cocked the gun. Can you see that? Can you 0:00:09.080 --> 0:00:11.119 see that? Can you see that? And she says and 0:00:11.119 --> 0:00:12.480 then I let go of the hammer of the gun 0:00:12.480 --> 0:00:15.240 and the gun goes off. Actor Alec Baldwin was pointing 0:00:15.240 --> 0:00:18.919 a gun at cinematographer Helena Hutchins as they rehearsed a 0:00:19.000 --> 0:00:22.000 scene on the set of The Western Rust in New Mexico. 0:00:22.520 --> 0:00:26.159 Hutchins was fatally shot, but Baldwin has maintained that he 0:00:26.200 --> 0:00:29.120 did not pull the trigger and that gun safety on 0:00:29.160 --> 0:00:34.080 the set was not his responsibility. Someone is responsible for 0:00:34.200 --> 0:00:36.479 what happened, and I can't say who that is, but 0:00:36.600 --> 0:00:40.360 the Santa Fe District Attorney is saying who is responsible. 0:00:40.680 --> 0:00:44.519 Baldwin in the Film's Armorer had a Gutierrez read a 0:00:44.640 --> 0:00:50.080 person died because of this negligence, because of this this recklessness, 0:00:50.120 --> 0:00:53.680 and d A. Mary Carmack all tweets is charging both 0:00:53.680 --> 0:00:57.560 of them with involuntary manslaughter, joining me as former federal 0:00:57.600 --> 0:01:01.680 prosecutor Robert Mintz, A partner mc harder in English, Bob, 0:01:01.840 --> 0:01:05.360 Most people see this as a tragic accident. Is it 0:01:05.520 --> 0:01:08.840 surprising that the d A is bringing charges. What this 0:01:09.080 --> 0:01:12.920 does represent a dramatic culmination of more than a year 0:01:12.920 --> 0:01:17.400 of speculation over who, if anyone, would be held accountable 0:01:17.840 --> 0:01:22.399 for the tragic death of cinematographer Elina Hutchen. In this case, 0:01:22.480 --> 0:01:26.120 there is no evidence that anybody did anything intentionally wrong. 0:01:26.600 --> 0:01:30.160 What it really turns on is whether they acted recklessly, 0:01:30.480 --> 0:01:33.039 In other words, whether they should have been more careful 0:01:33.400 --> 0:01:36.280 in making sure that the weapon that was being handled 0:01:36.319 --> 0:01:40.520 by Alec Baldwin did not contain a loaded bullet and 0:01:40.680 --> 0:01:44.920 ultimately it killed the cinematographer. Based upon a series of 0:01:45.000 --> 0:01:48.400 people who handled that weapon before it was placed into 0:01:48.400 --> 0:01:50.600 the hands of Alec Baldwin, the d A is going 0:01:50.640 --> 0:01:55.600 to file too involuntary manslaughter charges against Baldwin and Guccieras 0:01:55.680 --> 0:01:59.880 read two levels sort of that required different standards of proof. 0:02:00.320 --> 0:02:05.240 Under New Mexico law, there's voluntary manslaughter and involuntary manslaughter. 0:02:05.680 --> 0:02:09.920 Voluntary manslaughter consists of an intentional killing for which there 0:02:10.000 --> 0:02:14.240 was a mitigating circumstance that reduces the crime from murder. 0:02:14.639 --> 0:02:18.920 Involuntary manslaughter, which is what has been charged here, consists 0:02:18.960 --> 0:02:22.400 of a killing that was unintentional, but it results from 0:02:22.480 --> 0:02:26.960 either recklessness or criminal negligence. Here, Alec Baldwin was charged 0:02:27.000 --> 0:02:31.120 with two counts of involuntary manslaughter, one of which carries 0:02:31.160 --> 0:02:33.360 a penalty is up to eighteen months, and the other 0:02:33.840 --> 0:02:37.280 is more serious. It carries a penalty of a mandatory 0:02:37.360 --> 0:02:41.280 jailson of five years in jail because although it was 0:02:41.320 --> 0:02:44.480 involuntary manslaughter in the commission of a lawful act, he 0:02:44.680 --> 0:02:47.600 was done with the use of a firearm, so Balwin 0:02:47.720 --> 0:02:51.799 has said. Balwin has said all along that gun safety 0:02:51.880 --> 0:02:55.440 is not the actor's responsibility, and that he relied on 0:02:55.520 --> 0:02:58.760 the professionals on the set. Does that strike you as 0:02:58.760 --> 0:03:01.160 a good defense? That really is the heart of the 0:03:01.240 --> 0:03:05.120 defense here. Mr Baldwin's defense is simply that he had 0:03:05.240 --> 0:03:08.280 no reason to believe that there was a live bullet 0:03:08.320 --> 0:03:10.960 in the gun or frankly, anywhere on the movie set. 0:03:11.320 --> 0:03:13.840 And this is most important. That he relied on the 0:03:13.880 --> 0:03:17.640 professionals with who he worked, who assured him that gun 0:03:17.680 --> 0:03:20.280 did not have live rounds in it. And the question 0:03:20.560 --> 0:03:22.840 is for this jury, if it ever gets to a jury, 0:03:23.440 --> 0:03:27.520 is whether that is enough, whether he can simply turn 0:03:27.600 --> 0:03:31.200 over the responsibility for gun stacy to the professionals who 0:03:31.280 --> 0:03:34.200 worked around them and rely on what they tell him, 0:03:34.600 --> 0:03:37.640 or whether he has an added responsibility since he is 0:03:37.640 --> 0:03:40.920 the person who is holding the gun. Is he hand 0:03:41.040 --> 0:03:45.000 added burden to do something beyond simply conferring with the 0:03:45.040 --> 0:03:48.320 professionals and relying on what they tell him. The d 0:03:48.400 --> 0:03:51.640 A said that all the actors they spoke to said 0:03:51.680 --> 0:03:54.440 that either the actor should have checked the gun or 0:03:54.640 --> 0:03:56.880 should have had it checked in front of him, and 0:03:56.920 --> 0:03:59.960 that there was a pattern of criminal disregard for, say, 0:04:00.000 --> 0:04:02.520 safety on the set. So at trial, are we likely 0:04:02.560 --> 0:04:06.520 to hear from both sides experts about safety protocols in 0:04:06.520 --> 0:04:09.080 the industry. I think we are. I think in a 0:04:09.080 --> 0:04:12.640 lot of ways, what the DA has done here by 0:04:12.680 --> 0:04:15.960 saying things like, on my watch, no one is above 0:04:16.000 --> 0:04:19.919 the law. Everybody deserves justice, what she's really doing is 0:04:20.000 --> 0:04:23.080 putting not only Alex Baldwin on trial, but in a sense, 0:04:23.320 --> 0:04:27.480 Hollywood on trial, celebrity on trial. Really the question of 0:04:27.480 --> 0:04:30.520 whether Alec Baldwin should get any kind of special treatment 0:04:30.600 --> 0:04:32.799 here or whether he has to play by the same 0:04:32.880 --> 0:04:35.960 rules as everybody else. But the question is what are 0:04:36.040 --> 0:04:39.080 those rule and whether it was reasonable for him to 0:04:39.279 --> 0:04:41.440 rely on what others told him, or whether he had 0:04:41.480 --> 0:04:45.599 an added burden of checking that gun himself or taking 0:04:45.600 --> 0:04:48.840 additional steps to ensure that what he was told was 0:04:48.880 --> 0:04:52.680 accurate because he had in his hand a weapon that 0:04:52.839 --> 0:04:56.400 was a working pistol that if it did have light ammunition, 0:04:56.440 --> 0:04:59.400 could result in the fatality, which is exactly what happens here. 0:04:59.760 --> 0:05:03.520 How problematic is it going to be for Baldwin that 0:05:03.720 --> 0:05:07.159 he and the d A completely disagree about whether he 0:05:07.200 --> 0:05:09.600 pulled the trigger. Well, the trigger wasn't pull I didn't 0:05:09.600 --> 0:05:13.040 pull the trigger. The trigger had to have been pulled, 0:05:13.560 --> 0:05:16.600 so Alec is wrong. That gun was sent off to 0:05:16.680 --> 0:05:20.160 the FBI analyst in Virginia who took this gun to 0:05:20.279 --> 0:05:23.600 the replica of a vintage called forty five, and they 0:05:23.680 --> 0:05:27.680 determined that the weapons tested normally. In other words, they 0:05:27.760 --> 0:05:31.240 concluded that in order for the revolvers as fire, the 0:05:31.240 --> 0:05:33.479 trigger would have to be pulled. So what you have 0:05:33.600 --> 0:05:37.800 there is an inconsistency between what Alex Bold was saying 0:05:37.839 --> 0:05:40.040 about how he handled that weapon and what the FBI 0:05:40.160 --> 0:05:43.559 report says. Doesn't really go to the heart of the case. 0:05:43.720 --> 0:05:46.360 But when you're a defense lawyer, you never really want 0:05:46.400 --> 0:05:50.360 to have that kind of inconsistency because the prosecution may 0:05:50.400 --> 0:05:53.440 be able to argue to objuror that he is not 0:05:53.600 --> 0:05:56.440 telling the truth about whether he pulled the trigger, and 0:05:56.480 --> 0:06:00.400 therefore he made not being totally candid with the jury 0:06:00.640 --> 0:06:02.760 about what he was saying and what he was thinking 0:06:02.760 --> 0:06:05.080 and what he did when he handled that weapon. So 0:06:05.160 --> 0:06:08.240 the inconsistency does not necessarily something that goes to the 0:06:08.320 --> 0:06:12.280 hard the case, but inconsistencies in your witnesses testimony or 0:06:12.400 --> 0:06:15.040 never something that you want as a lawyer. There were 0:06:15.040 --> 0:06:19.279 three people who handled the gun. First gauccierres Read, the 0:06:19.279 --> 0:06:24.840 weapon specialist, Then Assistant Director David Halls, who handed Ballwin 0:06:24.920 --> 0:06:28.000 the gun saying cold gun meaning there was no live 0:06:28.080 --> 0:06:31.760 ammo in it. He's pleading guilty to negligent use of 0:06:31.760 --> 0:06:36.080 a deadly weapon. And then Baldwin any impact from the 0:06:36.120 --> 0:06:39.840 second person in the chain pleading guilty. Now, what happened 0:06:39.880 --> 0:06:43.559 here really is that the district attorney approached this case 0:06:44.240 --> 0:06:47.600 by scrutinizing the actions of everyone who handled the weapon 0:06:47.960 --> 0:06:51.120 and everyone who handled the live ammunition. And what they 0:06:51.160 --> 0:06:53.760 did was they looked at that chain of custody, and 0:06:53.920 --> 0:06:58.080 ultimately the prosecutor concluded that everybody in that chain of 0:06:58.120 --> 0:07:03.600 custody there's some respectability for this fatality. When bringing criminal charges, 0:07:04.000 --> 0:07:07.120 the prosecutor is going to argue, if you are holding 0:07:07.120 --> 0:07:10.640 a gun in your hands, you implicitly have a responsibility 0:07:10.680 --> 0:07:14.559 to make safety your business that you can't simply rely 0:07:14.880 --> 0:07:17.760 on others. And that's the heart of Alex Baldwin's defense 0:07:18.040 --> 0:07:20.440 that in the many years he's been on sets, he's 0:07:20.480 --> 0:07:24.520 handled guns many times. In other movies, he's always relied 0:07:24.520 --> 0:07:27.600 on professionals. He did the same thing here. I think 0:07:27.600 --> 0:07:30.680 we can expect the defense to bring on experts to 0:07:30.880 --> 0:07:35.760 talk about how the entertainment industry handles weapons on movie sets, 0:07:35.800 --> 0:07:40.080 what protocols Hollywood sets typically used, and they're gonna argue 0:07:40.360 --> 0:07:43.480 that what Alex Baldwin did was consistent with the way 0:07:43.720 --> 0:07:47.600 the entertainment industry handles weapons on movie sets. But the 0:07:47.640 --> 0:07:51.440 prostitution is likely to argue, however, is that that doesn't 0:07:51.480 --> 0:07:54.640 matter that the keys this case is not what Alex 0:07:54.720 --> 0:07:57.600 Baldwin did, but whether or not what he did was 0:07:57.720 --> 0:08:01.160 reasonable given the fact that he holding in his hand 0:08:01.520 --> 0:08:04.440 a working pistol. And they're going to try to argue 0:08:04.480 --> 0:08:08.720 that it doesn't matter what the protocols were set by Hollywood, 0:08:08.960 --> 0:08:11.080 that the law is the law, and you don't have 0:08:11.120 --> 0:08:13.680 two legal systems, one for those people who are powerful 0:08:14.000 --> 0:08:17.320 and one for everybody else. The question here is whether 0:08:17.360 --> 0:08:20.840 he acted recklessly and whether he did it willfully, and 0:08:20.920 --> 0:08:24.080 that's really going to be a tough issue for jurors 0:08:24.080 --> 0:08:26.160 to grapple with, which is why this is going to 0:08:26.240 --> 0:08:29.480 be a difficult case, not only for the prosecutions but 0:08:29.600 --> 0:08:32.679 also for the defense. Yeah, and of course, as you know, 0:08:33.240 --> 0:08:37.000 the prosecution has to prove its case beyond a reasonable doubt. 0:08:37.200 --> 0:08:39.880 Baldwin just has to raise a reasonable doubt in the 0:08:39.960 --> 0:08:45.079 juror's minds. Ironically, manslaughter can be more difficult to prove 0:08:45.240 --> 0:08:49.400 than first degree murder. Manslaughter has all of these nuances 0:08:49.480 --> 0:08:53.319 in it, Whereas if you're proving a case of premeditated murder, 0:08:53.360 --> 0:08:56.800 for example, you mostly have great evidence. You's got a confession, 0:08:57.240 --> 0:09:00.120 you have someone who had a motive, you may have 0:09:00.240 --> 0:09:04.840 good DNA evidence, you have behaviors both before and after 0:09:04.880 --> 0:09:07.800 the Criminal Act that helped put this case together. In 0:09:07.840 --> 0:09:10.920 a manslaughter case, there's really not so much of a 0:09:11.000 --> 0:09:14.640 dispute about what happened, but about whether the person acted 0:09:14.679 --> 0:09:18.679 reasonably under the circumstances. And it's a very fact specific 0:09:19.120 --> 0:09:22.440 and it really depends a lot on how the jurors 0:09:22.559 --> 0:09:25.920 viewed the individual's charge and again whether or not they 0:09:26.040 --> 0:09:30.200 viewed their conduct as reasonable. And in these cases where 0:09:30.200 --> 0:09:32.839 there has been a fatality on a movie set, the 0:09:33.000 --> 0:09:35.680 results have varied. This is not the first time that 0:09:35.720 --> 0:09:38.920 an actor has been charged with manslaughter in connection with 0:09:38.960 --> 0:09:41.599 a death during shooting of a movie. For example, in 0:09:41.679 --> 0:09:45.840 nineteen seven and Los Angeles jury acquitted director John Landis 0:09:45.920 --> 0:09:50.400 on four associates of involuntary manslaughter on charges stemming from 0:09:50.400 --> 0:09:54.000 the guests of actor Vic Marland two children in a 0:09:54.080 --> 0:09:56.800 helicopter crash on the set of the Twilight Zone movie. 0:09:57.240 --> 0:10:00.000 That case actually went to trial, and after ten months 0:10:00.240 --> 0:10:04.720 the jury foremant hole reporters that it was an unforeseeable accident, 0:10:04.840 --> 0:10:08.760 then that the case did not warrant prosecution. Other casesn't. 0:10:08.800 --> 0:10:12.280 Even more recently, people have end up leading guilty. There 0:10:12.360 --> 0:10:14.840 was a case during the filming of the movie Midnight Rider, 0:10:14.960 --> 0:10:18.920 a biopic about rock star Gregg Allman, where the director 0:10:19.000 --> 0:10:22.120 pleaded guilty to involuntary manslaughter and served over a year 0:10:22.160 --> 0:10:25.200 in prison in connection with a train crash that's killed 0:10:25.240 --> 0:10:28.439 in the system camera operator. So the results of them vary, 0:10:28.559 --> 0:10:31.760 and it's a very fact specific and it really depends 0:10:31.800 --> 0:10:35.880 a lot on how the jurors viewed the individual's charge 0:10:36.160 --> 0:10:39.719 and again whether or not they viewed their conduct as reasonable. 0:10:40.160 --> 0:10:43.160 This is a case where the stakes are enormously high. 0:10:43.360 --> 0:10:46.480 There's a lot of pressure on the prosecution for bringing 0:10:46.480 --> 0:10:50.600 this case. This case was something that has generated tremendous publicity, 0:10:50.840 --> 0:10:53.560 not only in New Mexico, but throughout the country and 0:10:53.600 --> 0:10:57.280 internationally because of the notoriety and the celebrity a Alex 0:10:57.320 --> 0:10:59.440 for all it went, and so there was enormous pressure 0:10:59.440 --> 0:11:02.240 on the d to look at this case and to 0:11:02.320 --> 0:11:04.880 try to send a message that nobody was above the 0:11:05.000 --> 0:11:08.079 law and that Alex Baudin was not getting any special treatment. 0:11:08.280 --> 0:11:11.040 And the fact that Alex Baldwan actually fired the weapon 0:11:11.600 --> 0:11:16.000 that killed Elana Hucon made it difficult for her to 0:11:16.080 --> 0:11:19.480 ultimately conclude that he bore no responsibility. But at the 0:11:19.520 --> 0:11:21.960 same time, here she's going to be faced with a 0:11:22.120 --> 0:11:26.480 very spirited defense. Alec Baldwin has hired a very good 0:11:26.480 --> 0:11:29.520 criminal defense lawyer and they are going to argue that 0:11:29.600 --> 0:11:33.199 Alex Baldro was told immediately before he was handed the 0:11:33.240 --> 0:11:36.199 gun that the gun was quote unquote cold, which means 0:11:36.200 --> 0:11:39.280 the professional who was handling the gun, who is whose 0:11:39.320 --> 0:11:41.679 custody the gun was in before it was handed to 0:11:41.720 --> 0:11:44.520 Alec Baudin, told him that the gun was safe to 0:11:44.640 --> 0:11:47.280 use as a prop. So it really comes down to 0:11:47.360 --> 0:11:50.160 a question of who do you believe, and whether or 0:11:50.200 --> 0:11:54.440 not you believe that Alex Baldwin was entitled to simply 0:11:54.480 --> 0:11:58.560 rely on the information he was getting from those professionals, 0:11:58.679 --> 0:12:02.520 or whether the industry practice or simply common sense and 0:12:02.720 --> 0:12:06.880 reasonableness dictated that he take additional steps, which is opening 0:12:06.880 --> 0:12:10.640 the chamber, double checking with others, taking additional steps to 0:12:10.760 --> 0:12:14.280 make sure that that weapon was safe to aim at 0:12:14.320 --> 0:12:18.040 somebody on the set, and that it was unreasonable and 0:12:18.200 --> 0:12:21.240 dangerous for him to have simply relied on what others 0:12:21.280 --> 0:12:24.160 told them, no matter that they were professionals and that 0:12:24.320 --> 0:12:26.880 it was their job to maintain the safety of the 0:12:26.920 --> 0:12:29.760 guns on the set. There's a lot of finger pointing 0:12:29.880 --> 0:12:34.679 going on. Alex Bowan has blamed Gautierra's read and Halls, 0:12:34.720 --> 0:12:38.440 and Gautierra's read says she wasn't called inside the church 0:12:38.520 --> 0:12:42.040 to inspect the weapons, and that Baldwin refused her offer 0:12:42.120 --> 0:12:45.600 to train him on this cross draw, which is apparently 0:12:45.600 --> 0:12:48.720 a dangerous method of carrying a hand on that started 0:12:48.800 --> 0:12:52.160 the west at trial. Is it okay if they continue 0:12:52.200 --> 0:12:56.400 pointing fingers at each other or should their defenses aligne Well, 0:12:56.440 --> 0:12:59.240 I think part of Alcoholwin's defense has to be that 0:12:59.360 --> 0:13:03.280 he relied and what other people did otherwise the responsibility 0:13:03.320 --> 0:13:06.079 fall solely to him. So his defense is going to 0:13:06.160 --> 0:13:09.600 be that that these other professionals, who were well trained 0:13:09.600 --> 0:13:12.480 and whose job it was to make sure that the 0:13:12.559 --> 0:13:14.720 gun was not loaded, to make sure that the gun 0:13:14.760 --> 0:13:18.080 was not posing a threat to others, he relied on them, 0:13:18.160 --> 0:13:20.720 and that as the actor, he does that all the 0:13:20.760 --> 0:13:23.920 time and it's not his responsibility to double check what 0:13:24.040 --> 0:13:27.840 they're doing. But in this case, there is the possibility 0:13:27.880 --> 0:13:31.280 that that defense could backfire on them in the sense 0:13:31.360 --> 0:13:34.680 that you are looking at somebody who's wealthy, who's powerful, 0:13:34.679 --> 0:13:37.640 who has a lot of celebrity and notoriety, who seemed 0:13:37.679 --> 0:13:42.559 to be pointing the finger at people who are lesser celebrities, 0:13:42.559 --> 0:13:45.599 people who work in the film industry, but whose names 0:13:45.640 --> 0:13:48.280 the average person has never heard of before, and so 0:13:48.520 --> 0:13:51.760 that's the danger were there that Alec Baldwin is trying 0:13:51.800 --> 0:13:56.000 to pass off his responsibility onto people who were working 0:13:56.040 --> 0:13:58.400 on the set, who are just doing their jobs, who 0:13:58.520 --> 0:14:01.640 may have been overworked, and who will also faced with 0:14:01.679 --> 0:14:04.679 the same charges she is. And the question is should 0:14:04.760 --> 0:14:08.120 everybody in the chain of custody here be responsible or that, 0:14:08.440 --> 0:14:10.840 or should one person in that chain of custody be 0:14:10.880 --> 0:14:13.520 able to rely on the other and try to avoid 0:14:13.559 --> 0:14:16.400 responsibility here. That's going to be the question that jurors 0:14:16.440 --> 0:14:19.880 will have to grapple with. Thanks Bob, that's Robert Mints 0:14:19.920 --> 0:14:24.560 of McCarter and English. There's a turf war between the 0:14:24.640 --> 0:14:28.800 Securities and Exchange Commission and the Commodity Futures Trading Commission 0:14:29.200 --> 0:14:33.320 over which should regulate the crypto industry. This is digital 0:14:33.360 --> 0:14:36.640 assets lost more than two trillion dollars in value and 0:14:36.680 --> 0:14:41.760 a string of prominent ventures blew up. In sec Chairman 0:14:41.800 --> 0:14:45.280 Gary Ginstler has been working to position his agency as 0:14:45.280 --> 0:14:48.200 the one to reign in crypto. Right now, there's not 0:14:48.360 --> 0:14:53.720 a market regulator around these crypto exchanges, and thus there's 0:14:53.760 --> 0:14:59.200 really not protection against frauder manipulation. If the regulator wins 0:14:59.240 --> 0:15:02.800 its high pro while lawsuit accusing Ripple Labs of selling 0:15:02.960 --> 0:15:07.840 unregistered digital tokens without adequate disclosure, it will strengthen the 0:15:08.000 --> 0:15:11.920 SEC's position to take the lead on crypto oversight. My 0:15:12.040 --> 0:15:15.240 guest is securities attorney Robert him a partner at Tarter, 0:15:15.360 --> 0:15:19.120 Krinsky and Drogn. He was formerly an assistant Regional director 0:15:19.160 --> 0:15:22.080 of the SEC. Bob tell us the views of the 0:15:22.240 --> 0:15:27.320 SEC and the CFTC over why it should regulate crypto well. 0:15:27.360 --> 0:15:30.880 The CFTC argues that crypto is more of a commodity 0:15:30.920 --> 0:15:33.600 in the sense that it's like a medium of exchange, 0:15:33.720 --> 0:15:36.920 where people are using it as a substitute for currency, 0:15:37.120 --> 0:15:40.280 and they're using it and they're purchasing things with it, 0:15:40.400 --> 0:15:44.960 and they're not really buying crypto primarily as an investment product, 0:15:45.160 --> 0:15:47.080 you know, the way you would with the stock or 0:15:47.200 --> 0:15:50.800 some sort of security. The SEC takes the opposite view. 0:15:50.880 --> 0:15:54.359 They say a lot of these cryptocurrencies and token offerings, 0:15:54.800 --> 0:15:57.640 although there is an element in them of a value 0:15:57.640 --> 0:16:01.360 of exchange or medium off the times, the primary way 0:16:01.440 --> 0:16:06.640 that these new tokens are marketed as being a profit potential, 0:16:06.680 --> 0:16:10.240 a very significant way for investors to make money by 0:16:10.320 --> 0:16:13.280 this investment, and that's the basis under which the SEC 0:16:13.520 --> 0:16:17.040 argues that it should have jurisdiction over cryptocurrencies and not 0:16:17.200 --> 0:16:22.840 the CFTC. I noticed that a lot of the cryptocurrency 0:16:22.880 --> 0:16:29.160 platforms and even Sam Bankman freed they're advocating for being 0:16:29.200 --> 0:16:34.320 overseen by the CFTC. Is that because SEC oversight would 0:16:34.360 --> 0:16:38.680 be more rigorous. The CFTC S approach is more of 0:16:38.720 --> 0:16:42.440 a lighter approach than the SEC had, And that's why 0:16:42.440 --> 0:16:45.920 a lot of the crypto sponsors and people behind tokens 0:16:45.960 --> 0:16:51.200 prefer the CFTC approach because with the security based regulatory system, 0:16:51.480 --> 0:16:55.080 there's all sorts of requirements for them to draft prospectuses 0:16:55.480 --> 0:16:59.680 and to register the tokens, and then there's also ongoing 0:17:00.000 --> 0:17:04.000 regulation of the exchanges on which those securities trade, and 0:17:04.040 --> 0:17:06.760 if crypto was to be deemed a security, all of 0:17:06.800 --> 0:17:10.399 those burdensome regulations would apply to it. With the c SEC, 0:17:10.600 --> 0:17:13.520 there there's somewhat of a similar regulatory structure in place 0:17:13.560 --> 0:17:17.919 that does have provisions for protection for market participants, but 0:17:18.000 --> 0:17:20.679 it's not really as onerous as the security system in 0:17:20.680 --> 0:17:23.480 a sense, so you don't have to draft prospectuses and 0:17:23.480 --> 0:17:25.560 and give as much in the way of disclosure as 0:17:25.600 --> 0:17:27.680 what we needed is if it was an investment as 0:17:27.680 --> 0:17:32.800 a security, SEC Chairman Gary Gensler seems to be positioning 0:17:33.040 --> 0:17:38.800 his agency to take on the job of overside of crypto. 0:17:39.000 --> 0:17:44.000 He has slapped multimillion dollar fines on crypto companies and 0:17:44.080 --> 0:17:48.560 those who promote digital assets. Yes, Chairman Gensler is certainly 0:17:48.680 --> 0:17:52.639 trying to position the SEC as the primary agency to 0:17:52.840 --> 0:17:56.359 regulate cryptocurrencies in the United States. In a way, this 0:17:56.520 --> 0:18:00.280 is a classic turf battle between two federal agency, the 0:18:00.320 --> 0:18:04.560 CFTC and the SEC, over who's going to have jurisdiction 0:18:04.920 --> 0:18:08.879 over cryptocurrencies. And I think it's indicative of the bigger 0:18:09.200 --> 0:18:13.480 failing in the sense that many other countries are engaging 0:18:13.520 --> 0:18:17.720 in a legislative process where people have votes and there's 0:18:17.720 --> 0:18:21.640 a rulemaking and there's a concerted, well thought out roadmap 0:18:21.720 --> 0:18:25.400 to how cryptocurrencies are going to be regulated. In contrast, 0:18:25.480 --> 0:18:29.360 the United States, we really don't have that system happening. 0:18:29.400 --> 0:18:31.280 There's been a number of different bills that have been 0:18:31.320 --> 0:18:34.960 introduced in Congress that haven't really got anywhere, and much 0:18:35.000 --> 0:18:37.680 of the regulation over the crypto markets in the United 0:18:37.720 --> 0:18:41.760 States is done through enforcement actions, whether those enforcement actions 0:18:41.760 --> 0:18:45.040 are brought by the SEC or the CFTC. And it 0:18:45.080 --> 0:18:48.600 really leaves market participants in the lurch because they really 0:18:48.600 --> 0:18:51.200 don't have the same level of guidance that other countries 0:18:51.240 --> 0:18:54.240 provide in terms of what rules are to be followed 0:18:54.320 --> 0:18:57.040 and what sort of compliance steps have to be taken. 0:18:57.720 --> 0:19:01.320 The Ripple case SEC soon Ripple is the most high 0:19:01.400 --> 0:19:05.480 profile fintech lawsuit. Tell us about it. The Ripple case 0:19:05.680 --> 0:19:09.120 is really the most significant enforcement case in the crypto 0:19:09.200 --> 0:19:12.320 space that the SEC has ever brought. It started the 0:19:12.320 --> 0:19:16.720 case back in December when it filed its complaint which 0:19:16.760 --> 0:19:21.000 alleged that Ripple and two executives with Ripple violated the 0:19:21.080 --> 0:19:24.960 registration provisions of the securities laws and raised over a 0:19:25.000 --> 0:19:28.800 billion dollars in violation of the securities laws in the 0:19:28.840 --> 0:19:32.280 United States. And this came as a great shock to 0:19:32.359 --> 0:19:35.400 the market. Ripple and It's and it's token x RP. 0:19:36.200 --> 0:19:39.480 We're among the most popular crypto tokens in the United 0:19:39.480 --> 0:19:43.080 States at that particular time, and the company had been 0:19:43.119 --> 0:19:47.200 in operations since so at that time eight years had 0:19:47.240 --> 0:19:50.359 gone by without the SEC, you know, ever saying anything 0:19:50.400 --> 0:19:52.119 that this was going to be a problem. Was they 0:19:52.200 --> 0:19:55.480 viewed Ripple or x RP as being an inviolation of 0:19:55.480 --> 0:19:58.960 the securities laws. And then out of nowhere, this enforcement 0:19:59.000 --> 0:20:03.760 lawsuit was filed back in and it really completely shook 0:20:03.800 --> 0:20:06.680 up the market for x RP. It led to its 0:20:06.720 --> 0:20:10.280 delisting in the United States from various exchanges, and the 0:20:10.400 --> 0:20:13.520 people who were holding that crypto token really suffered a 0:20:13.520 --> 0:20:16.840 lot of losses once the SEC brought that enforcement taste. 0:20:16.960 --> 0:20:19.359 And for over two years, Ripple has been fighting the 0:20:19.480 --> 0:20:22.920 SEC in court and trying to win a determination from 0:20:22.920 --> 0:20:26.040 the judge that the SEC simply does not have jurisdiction 0:20:26.119 --> 0:20:29.160 over Ripple or x r P. Yeah, and it's got 0:20:29.200 --> 0:20:32.600 some heavyweights to defend it, including Mary Joe White, who 0:20:32.720 --> 0:20:37.000 led the SEC for almost four years under President Obama. 0:20:37.320 --> 0:20:41.080 So what's taking so long for the judge to make 0:20:41.160 --> 0:20:45.040 this decision. Well, like any complicated case, there's a very 0:20:45.119 --> 0:20:49.080 lengthy discovery period that happened in this case also, where 0:20:49.119 --> 0:20:53.440 depositions were taken, A large amount of documents were exchanged 0:20:53.520 --> 0:20:57.760 between the parties. Each side had numerous experts that they 0:20:57.800 --> 0:21:01.320 retained to try to present evidence and all. This is 0:21:01.359 --> 0:21:04.120 somewhat unique because in the past, when the SEC has 0:21:04.200 --> 0:21:09.199 gone after various cryptocurrency sponsors and tokens. Many of them 0:21:09.240 --> 0:21:11.800 didn't really have the resources to fight the SEC, and 0:21:12.080 --> 0:21:14.679 there was a lot of settlements here. Ripple does have 0:21:14.760 --> 0:21:18.639 the resources, and they've hired very prominent defense attorneys and 0:21:18.760 --> 0:21:22.720 very talented defense attorneys to defend themselves. And right now 0:21:22.920 --> 0:21:25.440 that phase of the case has come to an end, 0:21:25.840 --> 0:21:28.400 and some rey judgment motions have been filed by both 0:21:28.400 --> 0:21:32.200 the SEC and by Ripple asking the judge to rule 0:21:32.359 --> 0:21:34.800 in their favor and saying that a trial is not 0:21:34.920 --> 0:21:38.119 necessary and that each side is requesting that the judge 0:21:38.359 --> 0:21:41.080 rule in their favor. So it's been a very lengthy, 0:21:41.240 --> 0:21:44.880 hard fought battle on both sides. Bob, Is the judge 0:21:45.080 --> 0:21:49.000 just going to make the decision about whether it's coin 0:21:49.680 --> 0:21:52.320 is a security or not? Is that the decision that 0:21:52.480 --> 0:21:54.639 is going to turn the case. Yes, that's really the 0:21:54.720 --> 0:21:57.360 key decision that the judge has to make right now 0:21:57.440 --> 0:22:01.600 on summary judgment, and much can do a few things. Um, 0:22:01.680 --> 0:22:05.840 the judge can rule for either the SEC on one hand, 0:22:05.960 --> 0:22:09.000 or the judge can rule or Ripple on the other 0:22:09.520 --> 0:22:12.399 And what the judge is trying to find out is 0:22:12.440 --> 0:22:16.159 if there's really a material dispute in the underlying facts. 0:22:16.200 --> 0:22:18.320 And if she finds that there is a dispute in 0:22:18.320 --> 0:22:20.440 the facts, didn't going to go to a jury trial. 0:22:20.760 --> 0:22:23.280 If the judge feels that there's no dispute in the 0:22:23.320 --> 0:22:25.919 facts and it's really just a question of law, then 0:22:25.960 --> 0:22:29.159 she'll feel comfortable making that decision. So the judge can 0:22:29.200 --> 0:22:31.720 either rule for one side or the other, or the 0:22:31.800 --> 0:22:34.240 judge can say there's too much in the way of 0:22:34.280 --> 0:22:37.080 factual disputes here and a jury has to rule. So 0:22:37.160 --> 0:22:40.520 there's three different possibilities that the judge can come down on. 0:22:41.119 --> 0:22:44.840 So a federal judge in New Hampshire in November and 0:22:44.880 --> 0:22:47.840 to find a digital asset as a security. Are there 0:22:47.880 --> 0:22:52.280 any cases where judges went the opposite way? Well, it's 0:22:52.359 --> 0:22:55.240 not so much a case, but Bitcoin is probably the 0:22:55.280 --> 0:22:59.879 primary example of a crypto token or cryptocurrency that is 0:23:00.000 --> 0:23:03.159 and deemed not to be a security, where even the 0:23:03.280 --> 0:23:07.560 SEC recognizes that as such. The issue is that almost 0:23:07.600 --> 0:23:11.640 every cryptocurrency is created in a different way, and it's 0:23:11.760 --> 0:23:15.199 marketed in a unique way, and it's very hard to 0:23:15.280 --> 0:23:18.840 generalize from one case to another because in certain cases, 0:23:19.040 --> 0:23:21.760 and the case in New Hampshire which you're referring to 0:23:21.800 --> 0:23:24.960 which involves the library token. The judge had to look 0:23:25.040 --> 0:23:28.080 at the marketing material as to how the token was 0:23:28.160 --> 0:23:31.159 promoted and what statements were made by the company, and 0:23:31.200 --> 0:23:33.840 that's going to vary from company to company. In the 0:23:33.920 --> 0:23:36.359