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

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Speaker 2: The Supreme Court's conservatives appear poised to give the president

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Speaker 2: control over dozens of independent federal agencies. At oral arguments

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Speaker 2: on Monday, they suggested they will allow President Trump to

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Speaker 2: fire Rebecca Kelly Slaughter from the Federal Trade Commission, despite

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Speaker 2: a law that says commissioners can only be fired for

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Speaker 2: specific reasons. The liberal justices, like Sonya so to Mayor

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Speaker 2: and Elena Kagan, expressed alarm at giving the president such

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Speaker 2: unchecked authority over agencies that overlook crucial areas like nuclear energy,

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Speaker 2: consumer products safety, and labor relations.

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Speaker 3: You're asking us to destroy the structure of government and

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Speaker 3: to take away from Congress its ability to protect its

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Speaker 3: idea that the government is better structured with some agencies

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Speaker 3: that are independent.

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Speaker 4: So the result of what you want is that the

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Speaker 4: president is going to have massive, unchecked, uncontrolled power not

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Speaker 4: only to do traditional execution but to make law.

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Speaker 2: But the conservative justice is, like Brett Kavanaugh and Neil Gorsuch, say,

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Speaker 2: the real concern is Congress's creation of agencies that exercise

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Speaker 2: executive power but can't be held accountable.

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Speaker 5: Independent agencies are not accountable to the people. They're not elected,

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Speaker 5: as Congress and the President are and are exercising massive

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Speaker 5: power over individual liberty and billion dollar industries, whether it's

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Speaker 5: the FCC or the FTC or whatever it might be.

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Speaker 6: Tomorrow, we could have the Labor Commission, the Education Commission,

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Speaker 6: the Environmental Commission, and rather than Departments of Interior and

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Speaker 6: so forth.

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Speaker 2: In allowing the president to fire the heads of independent agencies,

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Speaker 2: the court would be overturning a ninety year old president

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Speaker 2: called Humphreys executor that protects their independence. My guest is

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Speaker 2: constitutional law expert William Traynor, a professor at Georgetown Law

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Speaker 2: Bill tell us about the issues in Rebecca Slaughter's case

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Speaker 2: against Trump for firing her.

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Speaker 7: The issue before the screen Court is that Congress puts

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Speaker 7: the limits on when the president and fire the heads

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Speaker 7: of independent agencies. So an independent agency is like the

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Speaker 7: Federal Trade Commission or the Federal Reserve. So really, since

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Speaker 7: the start of the Constitution, Congress has imposed limits on

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Speaker 7: when the president can fired these people. The question in

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Speaker 7: the case is whether that's unconstitutional, Whether the president can

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Speaker 7: fire the head of an independent agency for any reason,

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Speaker 7: even if Congress has said they can only fire them,

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Speaker 7: you know, if they're engaged in bad behavior. So this

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Speaker 7: is a very big deal. So much of a government

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Speaker 7: structure that protects people in different ways or regulates the

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Speaker 7: economy is done through independent agencies. Congress has wanted to

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Speaker 7: insulate them from total executive control, and the Supreme Court

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Speaker 7: is deciding right now whether, in fact, the president has

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Speaker 7: the kind of control that comes with being able to

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Speaker 7: fire the leaders of the agencies.

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Speaker 2: In these oral arguments, you often hear the Supreme Court

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Speaker 2: justices say, well, that's a job for Congress. You know,

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Speaker 2: that's not something that we should be interfering in. So

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Speaker 2: why are they interfering here where Congress has set up

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Speaker 2: these agencies and the rules.

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Speaker 7: That's a great question. There had been so many times

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Speaker 7: in which the Court is saying, this is a political matter,

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Speaker 7: we shouldn't be deciding. But at the same time, the

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Speaker 7: conservative justices of the Court are very dedicated to what's

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Speaker 7: called the unitary executive theory, which means that the president

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Speaker 7: is in total charge of the executive branch. So what

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Speaker 7: they're saying here is Congress doesn't get to be involved.

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Speaker 7: The president is in total charge of the executive branch,

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Speaker 7: including what have historically been things like the independent agencies.

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Speaker 7: That is kind of one of the core commitments that

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Speaker 7: has really been at the basis of what Keef Justice

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Speaker 7: Roberts has thought really going back to when he was

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Speaker 7: a young attorney, and that's the same thing for most

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Speaker 7: of the members of the whole conservative wing.

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Speaker 2: What kind of concerns did the conservative justices express during

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Speaker 2: the oral arguments about this ninety year old President Humphrey's executor.

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Speaker 7: There are two things that we're seeing the conservative wing

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Speaker 7: of the Court struggle with. One is they want the

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Speaker 7: Federal Reserve to continue to be independent. They don't want

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Speaker 7: the president to be able to fire somebody on the

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Speaker 7: Federal Reserve. And they don't want that because you know,

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Speaker 7: that would be terrible for the economy. If the Federal

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Speaker 7: Reserve is setting interest rates just in order to help

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Speaker 7: the president rather than to help the economy, that would

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Speaker 7: be a disaster, be a disaster for the market, the

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Speaker 7: disaster for the economy as a whole. So the conservative

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Speaker 7: wing of the Court i think wants to overturn Humphrey's executor,

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Speaker 7: but they're trying to come up with some rationale in

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Speaker 7: which they can say the president can fire somebody on

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Speaker 7: the FTC, but he can't fire somebody on the Federal Reserve.

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Speaker 7: And they're going to be looking at the Federal Reserve

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Speaker 7: later in the term. That's a big concern for them.

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Speaker 7: So I think that animates all of the conservative justices

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Speaker 7: of the Court. I think also, you know, what I'm

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Speaker 7: hearing with the Chief Justices, what he's trying to do

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Speaker 7: is to come up with some way in which there's

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Speaker 7: some agencies where Congress can in fact limit the president's

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Speaker 7: ability to fire people. And he's thinking about, you know,

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Speaker 7: are the ones that are essentially kind of judicial in

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Speaker 7: their function, and you know, that may be an area

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Speaker 7: in which Congress can establish requirements or when the prison

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Speaker 7: can terminate somebody, but that's not the Federal Trade Commission.

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Speaker 7: Federal Trade Commission is not making the judicial decisions, you know,

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Speaker 7: it's very much deciding executive type rules. So I think

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Speaker 7: we're seeing two things on the conservative wing of the Court.

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Speaker 7: One is they're trying to come up with some way

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Speaker 7: in which they can say the President can fire somebody

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Speaker 7: the FDC, but not at the FED. And I think

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Speaker 7: the Chief is trying to come up with some way

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Speaker 7: in which there's some type of agencies in which the

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Speaker 7: president can be limited by Congress, but those would be

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Speaker 7: ones that are really deciding kind of fuzzi judicial matters,

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Speaker 7: not the FDC.

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Speaker 2: The liberals painted a dire picture of what would happen

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Speaker 2: if Trump wins here. Just as Soto Mayor said to

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Speaker 2: the Solicitor General, you're asking us to destroy the structure

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Speaker 2: of government. Do you think it's that serious.

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Speaker 7: I think that's absolutely right. You know, we have had

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Speaker 7: independent agencies which largely exists to protect peace with limited power,

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Speaker 7: you know, and they've been in place really for one

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Speaker 7: hundred years. And the idea is that these should be

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Speaker 7: basically bipartisan or apolitical. They should not just be tools

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Speaker 7: of the president. So what the court is considering right

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Speaker 7: now is whether that whole kind of structure gets got it.

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Speaker 7: So the stakes on this are huge.

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Speaker 2: Well, President Trump wasn't specifically mentioned by name, two of

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Speaker 2: the liberal justices, Elina Kagan and Katanji Brown Jackson, did

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Speaker 2: make broad references to his firing of experts and dismantling

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Speaker 2: of the Department of Education.

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Speaker 4: That the more realistic danger here is that we'll have

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Speaker 4: an education department, as authorized by Congress by law that

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Speaker 4: won't have any employees in it.

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Speaker 8: Having a president come in and fire all the scientists

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Speaker 8: and the doctors and the economists and the PhDs and

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Speaker 8: replacing them with loyalists and people who don't know anything

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Speaker 8: is actually not in the best interest of the citizens

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Speaker 8: of the United States.

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Speaker 7: You know, what we're seeing right now is that in

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Speaker 7: the Trump administration, you know, the independent agencies and all

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Speaker 7: of the government washtoogs, there's an attempt to politicize them

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Speaker 7: in a way that you know, we've never seen before.

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Speaker 7: So the stakes are very different, and they're much higher.

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Speaker 7: If Humphrey's executor has been overturned in President bush forty

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Speaker 7: threes administration, the stakes would have been very different because

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Speaker 7: President Bush was not focused on making independent agencies kind

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Speaker 7: of the tool for his politics. But that's what we're

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Speaker 7: seeing with President Trump, and that's why the stakes are

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Speaker 7: so high. They've always been big, but in this administration,

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Speaker 7: where there's such an attempt to kind of move away

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Speaker 7: from scientific expertise and neutral decision making to control every

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Speaker 7: part of the executive branch, the stakes are huge. And

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Speaker 7: that's really part of what those three liberal justices we're questioning.

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Speaker 7: You know, the other thing that they really are focusing

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Speaker 7: in an honor. First of all, it's very very hard

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Speaker 7: to come up with some line where you can say,

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Speaker 7: Congress can limit the president's ability to fire the heads

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Speaker 7: of the sec they can't fire at will the heads

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Speaker 7: of the set. And I can't think of any kind

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Speaker 7: of coherent way to distinguish those two cases. And that's

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Speaker 7: one of the things that the liberals were pressing on.

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Speaker 7: You know, I think they're also pressing on the history.

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Speaker 7: If you look at the constitutions, the text of the

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Speaker 7: constitutions doesn't say that the president gets to fire people

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Speaker 7: in the executive rection. It doesn't deal with removal at all.

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Speaker 7: So there's not a text that really helps the conservative

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Speaker 7: way of the Court and Congress really, starting in the

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Speaker 7: Washington administration, limited the president's ability to fire people running

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Speaker 7: agencies kind of what was analogous to modern agencies at

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Speaker 7: the time. So I think what the liberals on the

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Speaker 7: Court are focusing on are the text, the original understanding,

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Speaker 7: as well as the huge consequences of essentially giving the

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Speaker 7: president the power to politicize all of the dependent agencies.

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Speaker 2: I wonder what happens when there is a democratic president.

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Speaker 2: Do the conservatives then try to limit the ruling they're

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Speaker 2: expected to make.

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Speaker 5: Here.

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Speaker 7: You know, one of the reasons why I think that

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Speaker 7: the Court should not overturn Humphrey's Executor is to the

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Speaker 7: extent that you have any kind of political terms, you're

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Speaker 7: giving a democratic president the power to do exactly what

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Speaker 7: President Trump is doing, to politicize every independent agency in

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Speaker 7: the way that that president wants, you know. And then

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Speaker 7: how does a conservative court say, well, you know, Humphrey

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Speaker 7: Executors is back. Once you establish a rule, you know,

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Speaker 7: it applies to everybody. And that's something that they really

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Speaker 7: have to think true because of the long term consequences,

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Speaker 7: because I don't think they would feel comfortable, you know,

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Speaker 7: with limiting a democratic president after they allow President Trump

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Speaker 7: to fire people whenever he wants.

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Speaker 2: So then you think this is the end of Humphrey's executs.

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Speaker 7: Yeah, I think they will completely overrule Humphrey's Executor. I

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Speaker 7: think the one question for me is whether the Chief

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Speaker 7: comes up with some limiting principle in which if there

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Speaker 7: are you know, quasi judicial independent agencies, then Congress can

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Speaker 7: put limitations on the president's ability to fire. But you know,

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Speaker 7: the basic point is I think they're going to overturn

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Speaker 7: Humphrey's executive So I think what the Court will try

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Speaker 7: to do is to say the president can't fire Jerome Power,

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Speaker 7: can't fire at least a cook. But you know, I

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Speaker 7: don't think that that is a coherent approach, you know,

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Speaker 7: because I think it would be based on history, but

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Speaker 7: the history doesn't support it.

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Speaker 2: Well. We often see some strained interpretations of history from

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Speaker 2: this court. Thanks so much, Bill. That's Georgetown law professor

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Speaker 2: William Trainor coming up next. The Court grapples with caps

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

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Speaker 2: The Supreme Court is considering a Republican led effort to

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Speaker 2: erase yet another campaign finance regulation, this time the federal

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Speaker 2: caps that limit how much political parties can spend in

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Speaker 2: coordination with candidates. It's the latest in a line of

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Speaker 2: cases where the conservative majority has upended congressionally enacted limits

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Speaker 2: on raising and spending money to influence elections, and two

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Speaker 2: hours of arguments on Tuesday showed the entrenched divisions between

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Speaker 2: the liberal and conservative justices over campaign finance restrictions. Liberal

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Speaker 2: Justice Sonya Sotomayor said that every time the Court interferes

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Speaker 2: weakening campaign finance rules, it makes matters worse. While conservative

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Speaker 2: Justice Brett Kavanaugh said that spending limits have hurt political

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Speaker 2: parties in an era of unlimited spending by other organizations.

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Speaker 3: You're telling us that Citizens United and McCutcheon ended up

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Speaker 3: yes in ample find the voice of corporations, but diminishing

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Speaker 3: another voice, that of the party. Now you want to

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Speaker 3: now tinker some more and try to raise the voice

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Speaker 3: of one party. Our tinkering causes more harm than it

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Speaker 3: does good.

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Speaker 5: That's the real source of the disadvantage. Right, you can

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Speaker 5: give huge money to the outside group, but you can't

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Speaker 5: give huge money of the party. So the parties are

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Speaker 5: very much weakened compared to the outside groups.

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Speaker 2: Chief Justice John Roberts, a potentially pivotal vote, said he

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Speaker 2: didn't see much difference between contribution limits, which the Court

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Speaker 2: has long upheld, and the caps on coordinated expenditures.

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Speaker 6: It seems to me that that's kind of a fiction that, oh,

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Speaker 6: you know, they're just coordinating expenditures, they're not making direct contributions.

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Speaker 3: I don't know in substance what the difference is.

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Speaker 2: Doing away with the caps would overturn a quarter century

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Speaker 2: old precedent. In the same week, the court appears ready

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Speaker 2: to overturn an ninety year old president and allow President

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Speaker 2: Trump to fire the heads of independent agencies. Joining me

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Speaker 2: is an expert on campaign finance reform, Richard Brofald, a

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Speaker 2: professor at Columbia Law School. Rich Well, you start by

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Speaker 2: explaining the federal caps on spending by political parties in

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Speaker 2: coordination with candidates.

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Speaker 1: So the Federal Russian Campaign Act, going back to the

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Speaker 1: nineteen seventies when it was enacted in the aftermath of Artegate,

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Speaker 1: places limits on donations to candidates, and it also places

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Speaker 1: limits on donations to parties. It does something else, It

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Speaker 1: places limits on how much parties can give to candidates,

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Speaker 1: on the theory that donors, once they max out on

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Speaker 1: how much the donor can give directly to a candidate,

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Speaker 1: will then just give to a party to chanting the

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Speaker 1: money to a candidate. So there's a limit on how

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Speaker 1: much the parties can give to their candidates. And that

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Speaker 1: comes up in two ways. One is a literal limit

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Speaker 1: on contributions actually writing a check, but the parties are

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Speaker 1: also allowed to engage in their own spending in support

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Speaker 1: of candidates, and that's called coordinated expenditures. In other words,

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Speaker 1: the party does the spending, they don't give the candidate

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Speaker 1: a check, but they do spending to promote the candidate.

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Speaker 1: Parties are allowed to do that, but the law places

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Speaker 1: a limit on how much money they can spend supporting candidates.

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Speaker 1: And again for the same idea that if there is

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Speaker 1: no limit on how much they could support candidates through spending.

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Speaker 1: Once again, donors who once they max out on the

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Speaker 1: direct donation to the candidate would then just give to

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Speaker 1: the parties and the parties could then use that money

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Speaker 1: to basically support their candidates. But parties are allowed to

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Speaker 1: do this in a way that other organizations are not.

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Speaker 1: Packs are not allowed to coordinate at all with candidates,

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Speaker 1: so parties get this extra permission to support the candidates directly,

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Speaker 1: but with a cap on it, and it varies from

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Speaker 1: state to state based on the population of the state.

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Speaker 9: And what's going on in this case is.

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Speaker 1: The National Republican Senate Campaign Committee and JD. Vance, who

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Speaker 1: this case began was a Senator and a congressman from

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Speaker 1: Ohio has since retired, have all brought suit challenging this

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Speaker 1: limit on the ability of parties to coordinate their spending

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Speaker 1: with candidates.

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Speaker 2: And there's a longstanding precedent here.

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Speaker 9: Almost twenty five years ago.

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Speaker 1: The Supreme Court upheld this limit in a case called

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Speaker 1: Colorado Republican Sided in two thousand and one, and the

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Speaker 1: Court said yes, because of the danger of conduits a

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Speaker 1: party serving as conduits for donor support, these limits make

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Speaker 1: sense and are constitutional. Well, the Supreme Court is being

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Speaker 1: asked basically now, is to overturn that decision.

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Speaker 2: One of the concerns of the liberal justices was that

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Speaker 2: lifting the limits on party spending would lead to quid

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Speaker 2: pro quo bribery, so wealthy donors could bypass the individual

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Speaker 2: contribution limits by donating through parties instead.

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Speaker 1: I mean, that is the major concern of the liberal

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Speaker 1: justices and of a call the campaign finance reform community

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Speaker 1: as a whole, is that this will put another hole

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Speaker 1: in the campaign finance laws and make it easier for

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Speaker 1: wealthy donors to channel money to candidates. There's still limits

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Speaker 1: on their ability to give directly, but this would enable

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Speaker 1: them to give through the parties and so that money

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Speaker 1: would still get to candidate.

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Speaker 9: So yeah, that is the core concern.

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Speaker 1: A second concern is, depending on how the Court writes

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Speaker 1: this decision, it could be the green light for further

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Speaker 1: challenges to other aspects of the campaign finance laws, depending

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Speaker 1: on exactly how.

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Speaker 9: They write this.

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Speaker 1: So it's both upfront making it easier to channel money

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Speaker 1: from donors to candidates, and also yet one more case

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Speaker 1: eroding Congress's ability to place limits on campaign money.

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Speaker 2: The Administration and the Republican's argument centers on free speech

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Speaker 2: right as these campaign finance cases since Citizens United have done.

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Speaker 1: The essential argument is that this is a limit on

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Speaker 1: the ability of parties to speak, and that you don't

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Speaker 1: need it. That the combination of disclosure laws, anti bribery laws,

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Speaker 1: and limits on literally earmarking that's the term, that's use

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Speaker 1: a donation that our donor gives to a party to

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Speaker 1: be used for a candidate, that that's enough. That those

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Speaker 1: three things banning bribes, requiring disclosure, and saying that when

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Speaker 1: a donor gives a party a donation, they can't literally

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Speaker 1: say this is going to candidate so and so, that

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Speaker 1: that's enough, and that to go beyond that is to

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Speaker 1: constrain the ability of parties as free speech actors, as

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Speaker 1: First Amendment actors, to participate in political process.

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Speaker 2: Just as Brett Kavanaugh said, you can give huge money

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Speaker 2: to the outside group, but you can't give huge money

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Speaker 2: to the party, and so the parties are very much

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Speaker 2: weakened compared to the outside group.

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Speaker 9: See talking about super PACs.

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Speaker 1: And indeed, that is an argument that many people have

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Speaker 1: raised who don't like this law, including people who might

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Speaker 1: liberals or reformers. They say this law might have made

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Speaker 1: some sense when it was first adopted, but given the

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Speaker 1: proliferation of super PACs and other outside groups, we'd be

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Speaker 1: better off if parties actually had a bigger voice, that

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Speaker 1: parties can play a coordination function, that parties maybe can

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Speaker 1: be a little less extreme than some outside groups, that

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Speaker 1: parties have more of an interest in governance rather than

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Speaker 1: being single issue and that actually if we could start

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Speaker 1: roll over now that the outside groups have kind of

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Speaker 1: unlimited voice, that anything that strengthens the parties is actually

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Speaker 1: a good thing, and that you see many people who

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Speaker 1: are not conservatives who are taking that position, who are

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Speaker 1: not First Amendment absolutists, but think that in fact, the

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Speaker 1: campaign financ system has gotten unbalanced and it would actually

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Speaker 1: be good to strengthen the role of parties.

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Speaker 9: And this could do that.

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Speaker 2: There was also an argument about standing made by those

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Speaker 2: defending the caps that JD. Vance, who's no longer a

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Speaker 2: Senate candidate, doesn't have a stake in the case and

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Speaker 2: thus there's no standing. And then there was a lot

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Speaker 2: of discussion about, well, is he going to run for president?

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Speaker 2: I don't think this standing argument is going anywhere, but

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Speaker 2: it's interesting, so tell us about it.

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Speaker 1: So Ramond Martinez was the man appointed by the court

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Speaker 1: to defend the law when the government declined to do so,

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Speaker 1: and he opened by saying, this case is a big deal.

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Speaker 1: You know, anytime you're being asked to overturn a president

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Speaker 1: that's twenty five years old, should be very hesitant, and

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Speaker 1: you should make sure that this is a case that's

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Speaker 1: jurisdictionally sound, and he basically said it's not. So this

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Speaker 1: case was brought by some individuals JD. Vance and Congressman

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Speaker 1: Cheveaux from Ohio, and also by the National.

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Speaker 9: Republican Senate Committee.

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Speaker 1: With respect to the two individuals, one of them is

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Speaker 1: actually retired and no longer in politics, So that gets

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Speaker 1: it down to Vance. And Vance has pretty clearly said

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Speaker 1: I don't know if I'm running, or more than point,

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Speaker 1: I don't currently have a plan to run, saying I

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Speaker 1: might run, I might not run. So mister Martinez's argument was, well,

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Speaker 1: this case isn't right. We don't know if he's running,

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Speaker 1: so there's no candidate here to bring it, and therefore

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Speaker 1: there's no plaintiff. He's not a good plaintiff because whether

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Speaker 1: he's going to run a speculative. He doesn't clearly have

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Speaker 1: a stake in this case. So there were some back

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Speaker 1: and forth on that, but it does seem unlikely. Well,

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Speaker 1: you never know what the Supreme Court, but almost all

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Speaker 1: of the oral argument was really focused on the merits

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Speaker 1: of the case.

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Speaker 2: It doesn't seem as clear as in other cases. But

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Speaker 2: can you tell where the justices are on this? Gorsuch

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Speaker 2: didn't even ask a question.

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Speaker 1: It's worth pointing out that in every single campaign finance

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Speaker 1: case the Court has taken since Chief Justice Roberts became

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Speaker 1: Chief Justice and Justice Alito joined the court, the attack

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Speaker 1: on campaign finance law has won.

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Speaker 9: That's about eight cases.

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Speaker 1: And turn it around and there's not been a single

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Speaker 1: case that the Supreme Court has taken since two thousand

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Speaker 1: and five on campaign finance law where the law was

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Speaker 1: the state. That's all I think I need to say

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Speaker 1: about that.

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Speaker 2: Yes, Rich, that about says it all. So in light

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Speaker 2: of that, there were also questions about what's next. Justice

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Speaker 2: Katanji Brown Jackson basically asked the Republican's lawyer, former Solicitor

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Speaker 2: General Nol Francisco, if these caps on coordinated expenditures go down,

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Speaker 2: what's next the caps on contribution limits?

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Speaker 8: In McCutcheon, your clients filed a brief saying that the

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Speaker 8: sky wouldn't fall if the court struck down aggregate limits

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Speaker 8: because we still have coordinated expended truths. And now here

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Speaker 8: we are today with your clients saying no more coordinate

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Speaker 8: expenditure limits. And so I'm wondering if, and I think

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Speaker 8: others have sort of raised that concern as well, we're

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Speaker 8: going to be back here with the other kinds of

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Speaker 8: limits you with you making the same kinds of arguments.

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Speaker 10: Well, your honor, I think different limits are on stronger

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Speaker 10: footing than others. I am not going to say that

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Speaker 10: my clients are not going to come back and try

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Speaker 10: to challenge other limitations.

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Speaker 1: And indeed, it's the lawyer for people who are defending

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Speaker 1: this law, which I should say is not the government.

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Speaker 1: This is a federal statute. Well, the Trump administration will

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Speaker 1: not defend it. In fact, they'e actually joined in the

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Speaker 1: attack on it. So the statue was being defended by

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Speaker 1: two lawyers. One was a lawyer pointed about the Court

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Speaker 1: to speak for the statute, in addition the lawyer for

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Speaker 1: the Democratic organizations, and they both argue that basically this

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Speaker 1: is the bait and switch that's been going on in

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Speaker 1: campaign finance law for a long time. Someone says, well,

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Speaker 1: given changes in the law, this particular restriction does make

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Speaker 1: any sense, so you should strike it down. And then

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Speaker 1: they come along and say, well, now you've struck down

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Speaker 1: this one, the next restriction doesn't make any sense either,

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Speaker 1: so strike that down. And there seems to be kind

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Speaker 1: of a salami tactic aspect to this. A number of

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Speaker 1: the justices are very very skeptical, more than skeptical about

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Speaker 1: the constitutionality of the contribution restrictions. They don't have to

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Speaker 1: decide that in this case, but the Court has traditionally

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Speaker 1: treated coordinated expenditures as the constitutional equivalent of contributions. If

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Speaker 1: they're going to start protecting coordinated expenditures more saying that

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Speaker 1: they're more protected from limitation, it's not a big leap

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Speaker 1: to say that. That kind of thinking would also apply

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Speaker 1: to the contribution restrictions.

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Speaker 2: Finally, if by chance, the Court were to uphold the

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Speaker 2: spending caps, would you be surprised, fall off your chair?

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Speaker 2: Surprised or mmm, that's interesting.

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Speaker 9: Surprised, Well, probably fall off my chair.

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Speaker 1: I mean when the Court upheld this law in twentsand

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Speaker 1: and one, it was a five to four vote them.

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Speaker 1: And in terms of just the carmentary this Supreme Court,

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Speaker 1: I'm not sure if Justice Barrett has written on a

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Speaker 1: big campaign finance case, but all the other Conservatives have

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Speaker 1: and they've been rather consistently skeptical campaign finance.

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Speaker 2: The record you cid it does seem to indicate that

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Speaker 2: this cap is the next to go. Always great to

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Speaker 2: have you on, rich That's Professor Richard Braflt. Of Columbia

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Speaker 2: Law School. Coming up next on the Bloomberg Law Show.

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Speaker 2: Will investment funds be facing more lawsuits by activist investors?

440
00:24:28,320 --> 00:24:30,960
Speaker 2: Remember you can always get the latest legal news by

441
00:24:30,960 --> 00:24:34,480
Speaker 2: listening to our Bloomberg Law podcast wherever you get your

442
00:24:34,520 --> 00:24:38,399
Speaker 2: favorite podcasts. I'm June Grasso when this is Bloomberg.

443
00:24:39,920 --> 00:24:42,560
Speaker 5: I think this case is extremely close. I'll just put

444
00:24:43,520 --> 00:24:45,560
Speaker 5: cards out there on that.

445
00:24:45,800 --> 00:24:50,479
Speaker 2: And that deduction by Justice Brett Cavanaugh seemed correct because

446
00:24:50,560 --> 00:24:54,800
Speaker 2: Wednesday's eighty minute oral argument at the Supreme Court didn't

447
00:24:54,840 --> 00:24:59,280
Speaker 2: give a clear indication about the likely outcome. Wall Street

448
00:24:59,359 --> 00:25:02,520
Speaker 2: is watching the case over whether to allow investors to

449
00:25:02,640 --> 00:25:06,439
Speaker 2: broadly use an eighty five year old law to sue

450
00:25:06,480 --> 00:25:10,400
Speaker 2: funds over their management decisions. A lower court had allowed

451
00:25:10,480 --> 00:25:15,000
Speaker 2: activist investors led by SABA Capital Master Fund to sue

452
00:25:15,040 --> 00:25:19,959
Speaker 2: eleven closed end funds, including some affiliated with FS Credit

453
00:25:20,000 --> 00:25:24,600
Speaker 2: Opportunities and Blackrock. Justice Sonya Soto Mayor pointed to the

454
00:25:24,680 --> 00:25:28,400
Speaker 2: legislative history of the Investment Company Act to show that

455
00:25:28,480 --> 00:25:31,679
Speaker 2: Congress intended to allow private rights of action.

456
00:25:32,440 --> 00:25:35,879
Speaker 3: I know that many of my colleagues don't believe in

457
00:25:35,960 --> 00:25:40,479
Speaker 3: statutory history, but here we have both a House and

458
00:25:40,520 --> 00:25:44,760
Speaker 3: a Senate reports, a company, the nineteen eighty amendments to

459
00:25:44,800 --> 00:25:48,600
Speaker 3: the ICA, and in both the House and the Senate

460
00:25:48,680 --> 00:25:54,000
Speaker 3: reports it says that quote, private rights of action for

461
00:25:54,160 --> 00:25:58,840
Speaker 3: violations of the federal securities laws are a necessary adjunct

462
00:25:58,840 --> 00:26:01,840
Speaker 3: to the secs and for enforcement efforts.

463
00:26:02,160 --> 00:26:05,800
Speaker 2: But in recent decades, the Supreme Court has avoided finding

464
00:26:05,920 --> 00:26:10,800
Speaker 2: private rights of action unless Congress expressly authorizes them in

465
00:26:10,840 --> 00:26:15,560
Speaker 2: a statute. And Conservative Justice Neil Gorsich was critical of

466
00:26:15,640 --> 00:26:18,520
Speaker 2: allowing so called implied rights of action.

467
00:26:19,119 --> 00:26:23,040
Speaker 6: Pretty disastrous for our system of government, where the people

468
00:26:23,080 --> 00:26:26,680
Speaker 6: are supposed to write the laws that govern them, not judges.

469
00:26:27,480 --> 00:26:31,879
Speaker 2: The Trump administration is backing the mutual funds. Joining me

470
00:26:31,960 --> 00:26:35,840
Speaker 2: is securities law expert James Park, a professor at UCLA

471
00:26:35,920 --> 00:26:38,960
Speaker 2: Law School. Jim tell us about this legal fight.

472
00:26:39,440 --> 00:26:42,040
Speaker 11: Start sort of from the beginning. You have a hedge

473
00:26:42,040 --> 00:26:45,720
Speaker 11: fund SABA Capital, and one of its strategies is it

474
00:26:46,040 --> 00:26:50,000
Speaker 11: buys stock in mutual funds, mutual funds that are closed

475
00:26:50,040 --> 00:26:52,919
Speaker 11: and did which means that they have stock trading in

476
00:26:53,000 --> 00:26:56,800
Speaker 11: secondary markets. And the ideavia on the strategy is you

477
00:26:56,840 --> 00:27:00,879
Speaker 11: buy a substantial stake and you influence the governance of

478
00:27:00,920 --> 00:27:03,439
Speaker 11: the fund. You might think that it has poor governance,

479
00:27:03,480 --> 00:27:06,320
Speaker 11: and then that should increase the price of the stock.

480
00:27:06,400 --> 00:27:10,600
Speaker 11: That's what activist stock investors typically do, and then you

481
00:27:10,640 --> 00:27:13,480
Speaker 11: hopefully sell at a profit. And so they did this

482
00:27:13,680 --> 00:27:17,520
Speaker 11: for a number of mutual funds, and the funds basically

483
00:27:18,000 --> 00:27:20,600
Speaker 11: tried to take away their right to vote. There was

484
00:27:20,600 --> 00:27:22,840
Speaker 11: a state law in the state where they were formed

485
00:27:22,880 --> 00:27:25,440
Speaker 11: which said that you know, if you pass a resolution,

486
00:27:25,640 --> 00:27:28,920
Speaker 11: you can take away a shareholder's right to vote unless

487
00:27:29,080 --> 00:27:32,800
Speaker 11: a majority of the other shareholders basically give it back.

488
00:27:32,920 --> 00:27:35,360
Speaker 11: And this is, you know, almost a takeover defense sort

489
00:27:35,359 --> 00:27:38,440
Speaker 11: of thing. It reduces their influence on the company's governance.

490
00:27:38,600 --> 00:27:42,440
Speaker 11: And so what SABA Capital is arguing is that that

491
00:27:42,560 --> 00:27:46,119
Speaker 11: violates a law, a federal law called the Investment Company Act,

492
00:27:46,160 --> 00:27:49,119
Speaker 11: which is passed in nineteen forty, which is meant to

493
00:27:49,160 --> 00:27:53,320
Speaker 11: regulate mutual funds. The Investment Company Act basically says that

494
00:27:53,520 --> 00:27:56,840
Speaker 11: shareholders are supposed to have votes proportionate to the number

495
00:27:56,840 --> 00:28:00,040
Speaker 11: of shares that they own. And so what SABA the

496
00:28:00,080 --> 00:28:03,160
Speaker 11: Capital was arguing is that we have a private right

497
00:28:03,160 --> 00:28:06,320
Speaker 11: of action to sue and the remedy should be recision,

498
00:28:06,440 --> 00:28:09,040
Speaker 11: which means basically, we get our money back. And so

499
00:28:09,119 --> 00:28:12,000
Speaker 11: there's a question as to whether the Investment Company Act

500
00:28:12,080 --> 00:28:16,159
Speaker 11: authorizes a lawsuit like this, because the language does not

501
00:28:16,280 --> 00:28:20,440
Speaker 11: come out and say in a very straightforward way that

502
00:28:20,640 --> 00:28:22,679
Speaker 11: you have the right to sue for violations of the

503
00:28:22,720 --> 00:28:25,159
Speaker 11: Investment Company Act. And so the only way you can

504
00:28:25,200 --> 00:28:26,880
Speaker 11: say they have a right to sue is to say

505
00:28:26,880 --> 00:28:30,000
Speaker 11: there's something called an implied remedy here, sort of an

506
00:28:30,400 --> 00:28:33,840
Speaker 11: implicit right to sue that the Court can basically say

507
00:28:34,160 --> 00:28:35,760
Speaker 11: is evident from the law.

508
00:28:36,240 --> 00:28:40,280
Speaker 2: The Second Circuit Court of Appeals, which handles a lot

509
00:28:40,320 --> 00:28:44,280
Speaker 2: of these kind of financial cases and is well respected,

510
00:28:44,640 --> 00:28:46,640
Speaker 2: do it allow a private right of action?

511
00:28:47,280 --> 00:28:47,760
Speaker 9: They did.

512
00:28:47,920 --> 00:28:51,200
Speaker 11: They basically did in a different case. And Judge Laval,

513
00:28:51,400 --> 00:28:55,280
Speaker 11: who is a very prominent, respected Second Circuit judge, said

514
00:28:55,280 --> 00:28:59,760
Speaker 11: that the statute has language that can be read to

515
00:29:00,000 --> 00:29:05,760
Speaker 11: indicate that Congress intended for private parties to be able

516
00:29:05,800 --> 00:29:09,080
Speaker 11: to bring suit for recision when there is a violation

517
00:29:09,480 --> 00:29:13,080
Speaker 11: of the Investment Company Act, and he mainly based his

518
00:29:13,240 --> 00:29:16,400
Speaker 11: argument on the text. The text of the law says,

519
00:29:16,960 --> 00:29:21,160
Speaker 11: you know, if you hihilated the Investment Company Act, then

520
00:29:21,360 --> 00:29:24,680
Speaker 11: the various agreement that you entered into with the mutual

521
00:29:24,760 --> 00:29:29,120
Speaker 11: fund is unenforceable. It talks about, you know, in certain circumstances,

522
00:29:29,520 --> 00:29:32,760
Speaker 11: recision should not be denied by a party if the

523
00:29:32,800 --> 00:29:36,320
Speaker 11: benefit of recision outweighs some of the downsides. So there

524
00:29:36,360 --> 00:29:41,720
Speaker 11: is language that indicates that Congress might have envisioned these

525
00:29:41,760 --> 00:29:45,840
Speaker 11: private lawsuits happening, but it's not set in a straightforward way,

526
00:29:45,920 --> 00:29:48,760
Speaker 11: and I think that's what made the question ambiguous. And

527
00:29:48,800 --> 00:29:51,400
Speaker 11: in fact, the Third Circuit and a number of other

528
00:29:51,440 --> 00:29:54,600
Speaker 11: circuits have held the opposite and said that there is

529
00:29:54,760 --> 00:29:58,920
Speaker 11: not an implied right to sue under the Investment Company Act,

530
00:29:59,080 --> 00:30:03,160
Speaker 11: and Meeting Court generally has not favored these implicit rights,

531
00:30:03,200 --> 00:30:06,960
Speaker 11: which are not straightforward in the text of the statute.

532
00:30:07,200 --> 00:30:11,240
Speaker 2: And what were the concerns of the justices about allowing

533
00:30:11,280 --> 00:30:12,520
Speaker 2: a private right of action?

534
00:30:13,200 --> 00:30:15,000
Speaker 11: There were, you know, a number of concerns, and they

535
00:30:15,120 --> 00:30:19,600
Speaker 11: mostly focused on the statutory interpretation argument as opposed to

536
00:30:19,640 --> 00:30:23,560
Speaker 11: broader policy concerns. And you know, I think that they

537
00:30:23,640 --> 00:30:29,280
Speaker 11: were concerned that the language was not completely straightforward and

538
00:30:29,320 --> 00:30:33,040
Speaker 11: that there were some really difficult issues of interpreting what

539
00:30:33,080 --> 00:30:36,360
Speaker 11: the statute meant. Justice Kavanaugh went so far as to

540
00:30:36,400 --> 00:30:38,479
Speaker 11: say this was a very close case, that there were

541
00:30:38,480 --> 00:30:41,800
Speaker 11: good arguments on both sides. Some of the more liberal

542
00:30:42,000 --> 00:30:45,640
Speaker 11: justices pointed to the legislative history, and the legislative history

543
00:30:45,720 --> 00:30:48,720
Speaker 11: actually indicates that Congress thought that there would be an

544
00:30:48,760 --> 00:30:52,440
Speaker 11: implied right of action, And there were some reports senate

545
00:30:52,480 --> 00:30:55,960
Speaker 11: in house reports which said that the envisioned investors could sue.

546
00:30:56,120 --> 00:30:58,520
Speaker 11: But a lot of the more conservative justices, as you

547
00:30:58,560 --> 00:31:01,960
Speaker 11: may know, they don't really like to look at legislative history.

548
00:31:01,960 --> 00:31:04,240
Speaker 11: They like to look at the text of the statute,

549
00:31:04,240 --> 00:31:06,920
Speaker 11: and so a lot of the oral argument was puzzling

550
00:31:07,080 --> 00:31:10,880
Speaker 11: through how we read this language. That's basically what the

551
00:31:11,040 --> 00:31:13,120
Speaker 11: argument was mainly about.

552
00:31:13,240 --> 00:31:16,840
Speaker 2: I thought it was interesting that Justice Sodomayor prefaced her

553
00:31:16,880 --> 00:31:21,160
Speaker 2: remarks about the statutory history by saying, I know many

554
00:31:21,200 --> 00:31:25,560
Speaker 2: of my colleagues don't believe in statutory history. She also

555
00:31:25,600 --> 00:31:30,160
Speaker 2: referred to these private lawsuits as being in conjunction with

556
00:31:30,320 --> 00:31:35,000
Speaker 2: the SEC's enforcement efforts. But if you have private investors

557
00:31:35,080 --> 00:31:40,240
Speaker 2: bringing their own lawsuits, does that interfere with the SEC's

558
00:31:40,400 --> 00:31:41,800
Speaker 2: enforcement plans.

559
00:31:42,160 --> 00:31:46,280
Speaker 11: Definitely. The mutual fund industry has taken the position that

560
00:31:46,640 --> 00:31:49,560
Speaker 11: the statute is meant to be enforced by the SEC

561
00:31:49,880 --> 00:31:53,120
Speaker 11: rather than private plaintiffs, and that the SEC can come

562
00:31:53,120 --> 00:31:55,640
Speaker 11: in if there's a violation of the Investment Company Act

563
00:31:55,720 --> 00:32:00,440
Speaker 11: and bring various enforcement actions. And you know, I think

564
00:32:00,440 --> 00:32:03,680
Speaker 11: the response to that is the SEC has limited resources.

565
00:32:03,680 --> 00:32:05,680
Speaker 11: There are a lot of these mutual funds out there,

566
00:32:05,720 --> 00:32:10,080
Speaker 11: a lot of potential violations, and having private attorney generals

567
00:32:10,080 --> 00:32:12,200
Speaker 11: who are able to bring these suits maybe a more

568
00:32:12,200 --> 00:32:17,080
Speaker 11: effective way of enforcing these provisions. That was not really

569
00:32:17,160 --> 00:32:20,280
Speaker 11: discussed much in the oral argument. I think that argument

570
00:32:20,320 --> 00:32:22,200
Speaker 11: has fallen a bit out of favor with the more

571
00:32:22,240 --> 00:32:27,480
Speaker 11: conservative justices, but definitely the mutual fund industry believes that

572
00:32:27,560 --> 00:32:31,040
Speaker 11: it's really the sec that should be bringing enforcement actions

573
00:32:31,080 --> 00:32:31,719
Speaker 11: in this space.

574
00:32:32,320 --> 00:32:36,240
Speaker 2: What about suing in state court rather than federal court.

575
00:32:36,360 --> 00:32:38,960
Speaker 2: Here's what Justice Kavanaugh said, So.

576
00:32:38,880 --> 00:32:41,400
Speaker 5: It's a federal court state court issue. As I see it,

577
00:32:41,640 --> 00:32:43,640
Speaker 5: like this is going to happen. It's just going to

578
00:32:43,680 --> 00:32:45,280
Speaker 5: happen in federal court or state court.

579
00:32:45,520 --> 00:32:49,840
Speaker 11: There is also a lot of discussion about that possibility

580
00:32:50,160 --> 00:32:54,960
Speaker 11: that maybe what the statute means is that the contract

581
00:32:55,320 --> 00:32:58,840
Speaker 11: is unenforceable if there's a violation of the Investment Company Act,

582
00:32:59,400 --> 00:33:02,720
Speaker 11: and so then there would be litigation in state court

583
00:33:02,960 --> 00:33:06,320
Speaker 11: about the enforceability of the contract, And so that was

584
00:33:06,360 --> 00:33:10,200
Speaker 11: seen as a possibility. Have there ever been suits like that.

585
00:33:10,400 --> 00:33:12,560
Speaker 11: I don't know, and I think there would be a

586
00:33:12,600 --> 00:33:16,720
Speaker 11: little bit complicated, you know, especially the types of theories

587
00:33:16,760 --> 00:33:20,200
Speaker 11: that you might want to bring. Federal courts may have

588
00:33:20,240 --> 00:33:22,880
Speaker 11: a bit of an advantage over state courts in hearing

589
00:33:22,960 --> 00:33:26,080
Speaker 11: these types of issues, and so it would be a

590
00:33:26,080 --> 00:33:29,360
Speaker 11: bit awkward to say that these claims would mainly be

591
00:33:29,480 --> 00:33:32,760
Speaker 11: brought in state court as opposed to Federal Court if

592
00:33:32,760 --> 00:33:34,840
Speaker 11: you want to have this be an effective remedy in

593
00:33:34,880 --> 00:33:35,560
Speaker 11: my view.

594
00:33:35,720 --> 00:33:39,080
Speaker 2: Jim, can you give us a sort of simplistic explanation

595
00:33:39,480 --> 00:33:42,600
Speaker 2: of the position of each side here on the merits

596
00:33:42,600 --> 00:33:43,160
Speaker 2: of the case.

597
00:33:43,920 --> 00:33:47,640
Speaker 11: On one side, the investors might argue, we need some remedy,

598
00:33:47,680 --> 00:33:50,680
Speaker 11: we need a clear remedy when there are violations, and

599
00:33:51,000 --> 00:33:54,320
Speaker 11: you know, recision is a pretty powerful remedy under the

600
00:33:54,360 --> 00:33:57,440
Speaker 11: Investment Company Act, which was meant to regulate mutual funds.

601
00:33:57,800 --> 00:33:59,680
Speaker 11: On the other hand, I think what the mutual fund

602
00:33:59,720 --> 00:34:01,960
Speaker 11: in as worried about is that you're going to get

603
00:34:01,960 --> 00:34:05,240
Speaker 11: a flood of lawsuits and that that might actually be

604
00:34:05,320 --> 00:34:09,640
Speaker 11: bad for most investors in the mutual fund because only

605
00:34:09,680 --> 00:34:12,560
Speaker 11: a few investors might be interested, insuing, I'm only a

606
00:34:12,600 --> 00:34:17,080
Speaker 11: few investors may be pursuing an activist strategy with the fund,

607
00:34:17,760 --> 00:34:21,680
Speaker 11: and so the other investors may not be all that interested,

608
00:34:21,960 --> 00:34:25,800
Speaker 11: and it's costly to defend these lawsuits, and those costs

609
00:34:25,840 --> 00:34:29,520
Speaker 11: come out of the pockets of the other mutual fund shareholders.

610
00:34:30,000 --> 00:34:32,279
Speaker 2: It was hard to read the argument, although it did

611
00:34:32,320 --> 00:34:36,560
Speaker 2: seem like the liberal justices and perhaps the Chief Justice

612
00:34:36,800 --> 00:34:42,160
Speaker 2: and Justice Kavanaugh, might favor allowing the private lawsuits. But

613
00:34:42,239 --> 00:34:43,120
Speaker 2: what was your take?

614
00:34:43,800 --> 00:34:46,960
Speaker 11: It's close. I mean, my guess is I actually think

615
00:34:47,000 --> 00:34:49,520
Speaker 11: that they will find that there is a right of

616
00:34:49,560 --> 00:34:52,839
Speaker 11: action based upon the text of the statute. I think

617
00:34:52,880 --> 00:34:56,759
Speaker 11: there is enough in the text of the statute to

618
00:34:57,040 --> 00:35:00,480
Speaker 11: persuade at least some of the conservative justices. Is that

619
00:35:00,800 --> 00:35:04,120
Speaker 11: Congress intended for there to be a private right of

620
00:35:04,160 --> 00:35:08,080
Speaker 11: action for recision, I think the more liberal justices will

621
00:35:08,120 --> 00:35:11,680
Speaker 11: be persuaded by both the text, the legislative history, and

622
00:35:11,840 --> 00:35:15,160
Speaker 11: policy considerations. So I think they'll need to get a

623
00:35:15,200 --> 00:35:18,960
Speaker 11: couple of the Republican justices to decide with them, which

624
00:35:19,040 --> 00:35:21,359
Speaker 11: I think is very possible. It's not a sure thing,

625
00:35:21,520 --> 00:35:24,560
Speaker 11: but just my sense of the argument. If I felt

626
00:35:24,600 --> 00:35:26,560
Speaker 11: like Saba Capital might have had a bit of a

627
00:35:26,600 --> 00:35:29,360
Speaker 11: better argument in terms of the text on the statutory

628
00:35:29,360 --> 00:35:30,680
Speaker 11: interpretation issue.

629
00:35:30,760 --> 00:35:33,239
Speaker 2: And do you think that it's the correct decision to

630
00:35:33,360 --> 00:35:34,960
Speaker 2: allow the private investors to.

631
00:35:34,920 --> 00:35:38,799
Speaker 11: Sue As a policy matter, I think the risk that

632
00:35:38,800 --> 00:35:41,160
Speaker 11: it's going to lead to a flood of lawsuits may

633
00:35:41,239 --> 00:35:44,360
Speaker 11: be low. We'll have to see though. And my colleague

634
00:35:44,360 --> 00:35:47,480
Speaker 11: at UCLA for non Restreppo, actually has a study that

635
00:35:47,520 --> 00:35:50,160
Speaker 11: he just completed that looked at what happened after the

636
00:35:50,200 --> 00:35:53,680
Speaker 11: second Circuit allowed these lawsuits, and he didn't find a

637
00:35:53,719 --> 00:35:56,480
Speaker 11: flood of cases, and he didn't find a big impact

638
00:35:56,480 --> 00:35:59,480
Speaker 11: on the mutual fund industry. These are preliminary results, he

639
00:35:59,560 --> 00:36:01,800
Speaker 11: tells me, and so he may, you know, find something

640
00:36:01,800 --> 00:36:04,879
Speaker 11: different as he delves into the data. My sense is that,

641
00:36:05,000 --> 00:36:06,759
Speaker 11: you know, SABA Capital is a little bit of an

642
00:36:06,760 --> 00:36:11,240
Speaker 11: outlier in terms of pursuing a strategy like this. Most

643
00:36:11,280 --> 00:36:17,000
Speaker 11: activist funds are targeting public corporations rather than mutual funds. Now,

644
00:36:17,000 --> 00:36:18,879
Speaker 11: it might be that if you know you have more

645
00:36:18,960 --> 00:36:21,680
Speaker 11: rights and more leverage, that more funds may get into

646
00:36:21,719 --> 00:36:24,880
Speaker 11: this space. But it is a strategy that does require

647
00:36:24,920 --> 00:36:28,280
Speaker 11: you to make a pretty substantial investment in the mutual

648
00:36:28,320 --> 00:36:31,360
Speaker 11: funds so that you have significant votes. And it's a

649
00:36:31,400 --> 00:36:34,480
Speaker 11: little bit different than some of the shareholder lawsuits we

650
00:36:34,520 --> 00:36:38,080
Speaker 11: see with public companies, which have been criticized because you know,

651
00:36:38,120 --> 00:36:40,960
Speaker 11: you have plainers who own only a few shares who

652
00:36:40,960 --> 00:36:44,080
Speaker 11: have a right to bring a private action represented by

653
00:36:44,080 --> 00:36:47,399
Speaker 11: an attorney in a class action, and so that might

654
00:36:47,480 --> 00:36:50,920
Speaker 11: be the reason we see a lot of litigation in

655
00:36:50,960 --> 00:36:53,600
Speaker 11: the public company space. I don't know if that will

656
00:36:53,640 --> 00:36:58,319
Speaker 11: necessarily be true with respect to mutual funds. And you know,

657
00:36:58,360 --> 00:36:59,879
Speaker 11: the other thing to keep in mind is the imply

658
00:37:00,160 --> 00:37:03,080
Speaker 11: right of action is also just for recision, which means

659
00:37:03,320 --> 00:37:05,920
Speaker 11: the remedy as you get your money back, as opposed

660
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Speaker 11: to damages. That may also have some impact on the

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Speaker 11: incentives of plaintiffs to bring a lot of lawsuits for

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Speaker 11: violations of the Investment company Acts.

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Speaker 2: What's an investor lawsuit without damages? Thanks so much, Jim.

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Speaker 2: That's Professor James Park of UCLA Law School. And that's

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Speaker 2: it for this edition of The Bloomberg Law Show. Remember

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Speaker 2: you can always get the latest legal news on our

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Speaker 2: Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify,

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Speaker 2: and at www dot Bloomberg dot com, slash podcast, Slash Law,

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Speaker 2: and remember to tune into The Bloomberg Law Show every

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Speaker 2: weeknight at ten pm Wall Street Time. I'm June Grosso

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Speaker 2: and you're listening to Bloomberg