Speaker 1: This is Bloombird Law with June Brusso from Bloombird Radio,
Speaker 1: Who knows what evil lecks in the hearts of men?
Speaker 1: From the old time radio show to TV and movies,
Speaker 1: the shadow always sounded mysterious and ominous. Fast forward to
Speaker 1: the aptly named shadow docket. Emergency orders of the Supreme Court,
Speaker 1: short and unsigned, issued without a full briefing or arguments,
Speaker 1: often late at night and without explanation. While the shadow
Speaker 1: docket certainly isn't new, it's gaining ground on the regular docket.
Speaker 1: Since August, the Court has issued more orders on the
Speaker 1: shadow docket than opinions on the merits docket. Me Cony
Speaker 1: Barrett is probably the first justice to be asked about
Speaker 1: it at her confirmation hearings. You know, the shadow docket
Speaker 1: has become a hot topic in the last couple of years.
Speaker 1: This past term, the Court has used the shadow docket
Speaker 1: to decide issues affecting millions of Americans, from abortion to
Speaker 1: voting rights to COVID policy, and the three most conservative
Speaker 1: justices have signaled they want to use it even more aggressively.
Speaker 1: My guest is constitutional law experts Stephen Vladdock, a professor
Speaker 1: at the University of Texas Law School. He's testified before
Speaker 1: Congress about the shadow docket. Steve, why are we hearing
Speaker 1: so much about the shadow docket lately? Well, I mean,
Speaker 1: I think part of it is that the Court is
Speaker 1: doing more and more significant stuff on the shadow docted.
Speaker 1: I think more of it is that, you know, folks
Speaker 1: are paying attention to it to a better degree than
Speaker 1: ever before, and the Court, for all the headlines and
Speaker 1: dramas around him, the most recent term, is actually deciding
Speaker 1: a fewer cases on the merits doctor it at any
Speaker 1: point since the Civil War. So you know, when you
Speaker 1: have a flurry of significant rulings coming down through these unsigned,
Speaker 1: often unexplained orders, it's no surprise that folks are paying
Speaker 1: a lot more attention to that part of the Supreme
Speaker 1: Court's work. Since August of one, the justices have issued
Speaker 1: sixty six emergency orders compared to sixty merits opinions. So
Speaker 1: does something seem off there or are these really emergencies?
Speaker 1: Twenty nine were related to COVID rules fifteen to executions. Well,
Speaker 1: and I think it's worth stressing that the denominator there
Speaker 1: is not necessarily telling us how often the Court's intervening
Speaker 1: I mean, so far this term, I might kind of
Speaker 1: think the Court has granted sixteen emergency applications. That's on
Speaker 1: rough paste for where we've been the last couple of years,
Speaker 1: which is twenty to twenty four per term. But even
Speaker 1: that's up dramatically over you know, prior years June. I
Speaker 1: think part of what's going on is there have been
Speaker 1: obviously a whole bunch of external causes for increased emergency delegation.
Speaker 1: You know, part of it is that because the Court
Speaker 1: is actually granted more of these applications, because more and
Speaker 1: more of these efforts are succeeding. You know, lawyers are
Speaker 1: acting as lawyers act. Lawyers are going to try to
Speaker 1: remember the application in context in which they previously would
Speaker 1: not have. And so I think we're just generally seeing
Speaker 1: an increasingly active shadow docket, be getting an increasingly active
Speaker 1: shadow docket where the more the justices seem willing to
Speaker 1: intervene early in cases to disrupt the status quo through
Speaker 1: these unsigned and usually i'll explained orders, the more the
Speaker 1: parties are going to ask them to. I think that's
Speaker 1: why we're seeing the shadow docket really start to compete
Speaker 1: with the merits docket in overall volumes. This term, the
Speaker 1: Court used the shadow docket to decide several hot button issues.
Speaker 1: Have you identified any issues you think they shouldn't be
Speaker 1: deciding on the shadow docket. It's hard to sort of
Speaker 1: say that there's an issue that should or shouldn't be
Speaker 1: for the shadow doc. And I think the question is
Speaker 1: is the case really an emergency and it's just really
Speaker 1: a context where the Court doesn't have time to hustle
Speaker 1: the matter onto the marriage docket, to give the parties
Speaker 1: time for plenary briefing, to hold oral argument, to write
Speaker 1: you know, the more conventional, lengthy opinions, and you know, frankly,
Speaker 1: I mean, one of the things about this term that's
Speaker 1: really interesting is that I think the Court has started
Speaker 1: to react to some of the criticisms of the shadow dockets.
Speaker 1: You know, two of the most significant shadow docket rulings
Speaker 1: all term where the OSHA and CMS vaccine mandate cases.
Speaker 1: And in those cases, even though those were emergency applications,
Speaker 1: the Court actually held oral argus and the first time
Speaker 1: the full Court has heard oral argument on an application
Speaker 1: since the nineties. That you know, we've seen the Court
Speaker 1: move a couple of cases from the shadow doctor to
Speaker 1: the merriage docket. That dispute in Texas over whether a
Speaker 1: death row inmates could have a religious official in the
Speaker 1: execution chamber with him who could touch him and pray
Speaker 1: over him. You know, while the execution protocol was being administered,
Speaker 1: that started on the shadow docket. The court kicked it
Speaker 1: to the merrit's docket. So two nights. I don't think
Speaker 1: we can sort of stay as an abstract matter. Issue
Speaker 1: X shouldn't be on the shadow docket. I think the
Speaker 1: real of problems is that the court is treated as
Speaker 1: emergencies saving pretrist aren't. I mean, there was a really
Speaker 1: significant April shadow docket ruling in a case about the
Speaker 1: Clean Water Act, where by a five to four votes,
Speaker 1: the Conservative justices other than Chief Justice Roberts stayed a
Speaker 1: district court order stayed an injunction that a district court
Speaker 1: in California had issued against a Trump era rule, even
Speaker 1: though the district court had ruled five months earlier, and
Speaker 1: even though the parties that were asking sport for a
Speaker 1: day hadn't shown any harm that had resulted by dint
Speaker 1: of that district court, and so, as Justice Cadian pointed
Speaker 1: out in her dissent in that case, a case called
Speaker 1: Louisiana versus American rivers. If the court's going to use
Speaker 1: the shadow docket in cases that just aren't emergencies like
Speaker 1: that case, then the shadow doctors not for emergencies at all.
Speaker 1: And all that's really happening is that these are simply
Speaker 1: disguised and even more simply reasons merit's decisions. And that's
Speaker 1: I think why there are folks like me who have
Speaker 1: become so much more publicly critical of what the court
Speaker 1: is doing in this context. Yeah, that cut my eye.
Speaker 1: Undoing an e p A rule on water quality standards,
Speaker 1: how did they even justify or they don't have to justify,
Speaker 1: guess taking that on an emergency basis, it seems outlandish.
Speaker 1: And this is exactly where we are. I mean, I
Speaker 1: think in that case of such a crystallization, where hard
Speaker 1: to see what the emergency was, given that there has
Speaker 1: been five months the district Court had ruled. Even if
Speaker 1: right the court was sympathetic to Louisian his claims on
Speaker 1: the merits, the district Court had misread the clean water
Speaker 1: after and misapplied relevant precedents about administrative law. You know,
Speaker 1: why not just put that on the marriage docket and
Speaker 1: deal with it in due court. And what's so I
Speaker 1: think strike came about that decision June is you know,
Speaker 1: you ask, you know, why did they do it right? Well,
Speaker 1: we don't know because there was no majority opinion, there
Speaker 1: was no concurrent opinion. We know it was five or
Speaker 1: only because four justices publicly joined in the dissent, and
Speaker 1: not just the three democratical points. These chief us to
Speaker 1: John Roberts, joined Justice Kiggin's The Scent, an opinion which
Speaker 1: called out the majority for in Justice Kiggan's words abusing
Speaker 1: the shadow docket. So I think what we're seeing is
Speaker 1: more and more public awareness of a trend that really
Speaker 1: started in and the Clean Water Ract case is especially
Speaker 1: I think Goland because the decision came just two days
Speaker 1: after Justice Barrett gave this speech at the Ronald Reagan's
Speaker 1: Presidential Library where she says, you know, if you really
Speaker 1: think we're politicians in robes and not judges, read our opinion.
Speaker 1: Read the opinion and see for yourself if there are
Speaker 1: legal principles driving our decision making. Well, two days later,
Speaker 1: she is the decisive vote in the Clean Water Ract case,
Speaker 1: in which there was no opinion to read and in
Speaker 1: some of these cases, you have lower courts having trials
Speaker 1: on these issues, and then the Supreme Court comes along
Speaker 1: and says, no, we're reversing that, without oral argument, without
Speaker 1: any explanation. It's I don't know what else to say
Speaker 1: that it's sort of jaw dropping. The key is that
Speaker 1: I think there are a lot of folks out there
Speaker 1: who think that all that matters is the bottom line.
Speaker 1: And so if I say that the bottom line is okay,
Speaker 1: then I don't care about how the court cut there,
Speaker 1: but the process matters here. There's a more recent Louisiana
Speaker 1: case about redistrict in that I think is really instructive here.
Speaker 1: So Louisiana, you know, like a number of states, is
Speaker 1: redrawing its congressional districts after and in life of a
Speaker 1: district court, after an extensive hearing, writes this one hundred
Speaker 1: and fifty two page decision that carefully sets out why
Speaker 1: he believed Louisiana's maps violated the voting rights. That why
Speaker 1: he believed Louisiana was required to draw at least one
Speaker 1: more so called majority minority district to avoid violating steps
Speaker 1: in two of the voting right back. And it is
Speaker 1: a full bore full sorted analysis. Louisiana asked the Fifth Circuit,
Speaker 1: the most conservative pelic court in the country, to stay
Speaker 1: that district court decisions so we can use those maps
Speaker 1: in the two elections. And the Fifth Circuit refuses to
Speaker 1: issue a stay and writes thirty three pages of its
Speaker 1: own about why, in its view, the district Court decision
Speaker 1: was at the very least not set it to a
Speaker 1: stay and maybe even correct. And then Louisiana goes to
Speaker 1: the Supreme Court and says, hey, Supreme Court, will you
Speaker 1: stay the district court decision? And the Supreme Court stays
Speaker 1: the distric Court decision with narrow a sentence of explanation.
Speaker 1: And so you have district courts, you know, doing their job,
Speaker 1: working really really hard, writing really really thorough opinions. You
Speaker 1: have the appeals courts doing their job writing thorough opinions.
Speaker 1: And there's the Supreme Court, which in one sentence just says, nahum,
Speaker 1: you know, I don't see how that is a legal
Speaker 1: system that is going to increase public confidence in the
Speaker 1: Supreme Court as an institution versus the notion that was
Speaker 1: a sort of the synecolon non of the Supreme courts
Speaker 1: legitimacy is its ability to explain itself. Did Justice Kavanaugh
Speaker 1: try to make a distinction between, you know, how fast
Speaker 1: the election was coming up? In one of those cases,
Speaker 1: there's an Alabama case from earlier this term where Justice
Speaker 1: Kavanaugh wrote a concurrence in the unsigned on its lay
Speaker 1: in Supreme Court order staying a similar ruling in Alabama.
Speaker 1: I mean, you had so the Albama cases in some
Speaker 1: respects even more egregious, where you know, Alabama, a bunch
Speaker 1: of Alabama voters the day after Governor Ivy signs the
Speaker 1: congressional maps into law, they filed suit, like they filed
Speaker 1: to literally as soon as they could. The case goes
Speaker 1: to a three judge district court, which is comprised, I
Speaker 1: think entirely of Trump appointees. The district court says these
Speaker 1: maps violate the voting right that and you know, it's
Speaker 1: just a lengthy opinions that you know, you've got to
Speaker 1: draw him again. And the Supreme Court stays that order.
Speaker 1: But what's crazy, as Kavanaugh's concurrence relies on this thing
Speaker 1: called the personel principle and the for self principle is this,
Speaker 1: you know, based on the two thousand and six shadow
Speaker 1: docket ruling UM that federal court should not change the
Speaker 1: rules for elections as the elections approach. Well, in the
Speaker 1: Alabi on the case, the elections were nine months away, um,
Speaker 1: And even the primaries, which could have been moved if
Speaker 1: they had to be, were four months away. And so
Speaker 1: you know, yeah, Justice Kavanaugh, I think I remember, joined
Speaker 1: by Justice Alito. You know, it writes the short concurrence
Speaker 1: trying to justify at least why the two of them
Speaker 1: voted for a day. But if anything like they're concurring,
Speaker 1: opinion raises more questions than it answers, because you know,
Speaker 1: if Purcell applies that far in a dance of an election,
Speaker 1: then how can you ever have an injunction in a
Speaker 1: dance of an election that's going to be effect is
Speaker 1: And you know, I think that part of the problem
Speaker 1: here is that when you have either no explanation as
Speaker 1: in Louisiana case, or explanations that just don't hold up
Speaker 1: to scrutiny, as in the Kavanaugh concurrence in the Alabama case,
Speaker 1: you know, June, for those who want to see partisanship
Speaker 1: and rank politics, there's nothing to disabuse them of that conclusion.
Speaker 1: There's no analysis to point in other direction. No one
Speaker 1: can say, well, you know, that's just because you disagree
Speaker 1: with how the Court is explaining itself. Well, if the
Speaker 1: courts not explaining itself, what is there to disagree? Looking
Speaker 1: at the numbers and the partisan splits the courts. Liberal
Speaker 1: justices Stephen Bryer, Sonya Soto Mayor, and Atlanta Kagan dissented
Speaker 1: the most in emergency orders that were granted, but conservative
Speaker 1: justices Clarence Thomas, Samuel Alito, and Neil Gorsich did so
Speaker 1: the most when the Court refused to act on appeal.
Speaker 1: So what does that tell you? One of the many
Speaker 1: interesting things about the shadow doctors, I think there's in
Speaker 1: some respects more interesting data about the justices voting patterns
Speaker 1: than there is on the merits docket. So there was
Speaker 1: this remarkable moment last October. There was a case out
Speaker 1: of made called Does versus Mills. It was a challenge
Speaker 1: by US, the main healthcare workers, to the state's mandate
Speaker 1: that healthcare represent the states be vaccinated. And there was
Speaker 1: like a one paragraph concurring opinion by Justice Barrett, joined
Speaker 1: by Justice Kavanaugh that basically said, just because we're sympathetic
Speaker 1: to your claims on the merits. Doesn't mean we're automatically
Speaker 1: going to vote to grant emergency relief. You know, we're
Speaker 1: going to exercise some modicum of this suppression and deciding
Speaker 1: when emergency release isn't as imporanted. Basically, Barrett and Kavanaugh
Speaker 1: laying down a marker that they were going to not
Speaker 1: vote to grant emergency release as often as they had
Speaker 1: today as recently as the previous term and June we've
Speaker 1: seen that play out. I mean, we've seen a number
Speaker 1: of cases since October where the only public dissenters from
Speaker 1: a denial of relief were Thomas A Leader and Gorsage,
Speaker 1: And so the assumption is that Barrett and Kavanaugh did
Speaker 1: not join them. Some of these have been vaccine mandate cases,
Speaker 1: you know, the Navy Seals cases a good example of that.
Speaker 1: Some of them have been cases about like for example,
Speaker 1: Texas is social media law, and in that respect, again,
Speaker 1: I think one of the stories of the October one
Speaker 1: term is that the Court has at least to some
Speaker 1: de moderated its shadow doctor behavior. But I actually think
Speaker 1: in some respects even the moderated version of it is
Speaker 1: just as problematic as you know, what we saw, for example,
Speaker 1: during the October term, and the fact that Thomas the
Speaker 1: Leader and Gorges would go further and would grant emergency
Speaker 1: release even more often. I think, because you know, a
Speaker 1: sign of how close we are to this being even
Speaker 1: more of a problem already is so, then do the
Speaker 1: lineups on the shadow docket differ from the lineups in
Speaker 1: merits cases. There's a tendency when folks think about the
Speaker 1: court to think about the stick three chord or the
Speaker 1: three three three court, and I think that's not quite
Speaker 1: fair on the shadow doctor. I mean, one of the
Speaker 1: things that we saw again this term was Chief Justice
Speaker 1: Roberts joining with the Liberals a number of times in
Speaker 1: dissenting from shadow doctet orders. And so I think the
Speaker 1: shadow docket, as much as anywhere else, is basically as
Speaker 1: goes Kavanaugh and Barrett, so goes the Court. And you know,
Speaker 1: one of the things the striking numbers of the whole
Speaker 1: term is every justice dissented at least once June in
Speaker 1: a merit's case. I think the fewest was three by
Speaker 1: Kavanaugh in the Chief. But on the shadow docket there
Speaker 1: wasn't a single shadow docket order all term from which
Speaker 1: Justice Kavanaugh publicly dissented, and I think that's a sign
Speaker 1: of the times. I think that's a sign of who's
Speaker 1: basically the critical vote in shadow doctet context. And I
Speaker 1: think it's all the more reason to be wary about
Speaker 1: a fourth that's not explaining itself, given that. You know,
Speaker 1: when Justice Kavanaught is right in on the shadow docket,
Speaker 1: as in the Alabama redistrictive case, his opinions are often,
Speaker 1: shall we say, not exactly satisfied in providing a coherent,
Speaker 1: sort of defensible forward looking that explanation, Thanks so much, Steve.
Speaker 1: That's Professor Stephen Vladdock of the University of Texas Law School.
Speaker 1: Remember back in May when Elon Musk tried some legally
Speaker 1: to describe his claim that Twitter breach there forty four
Speaker 1: billion dollar buyout deal. You know, it's a material abvers
Speaker 1: uh misstatement. You know, if if if they in fact
Speaker 1: have been um for surferously claiming less than five of
Speaker 1: VEGERSPAM accounts, but in fact it is four or five
Speaker 1: times that number, or perhaps ten times that number. This
Speaker 1: is a big deal. It is a big deal. But
Speaker 1: the Delaware Chance to Record is treating it just like
Speaker 1: any other big deal. It handles, and the indication is
Speaker 1: that the judge doesn't think that counting bots is the
Speaker 1: main issue. Joining me is Eric Tallely, a professor at
Speaker 1: Columbia Law School. So Eric Musk lost the first round
Speaker 1: in court, the Chief Judge, Kathleen McCormick put the case
Speaker 1: on the fast track, with trial scheduled for October. What
Speaker 1: do you think is the real reason Musk wanted to
Speaker 1: delay until February or was it delayed just for delays sake? Yeah,
Speaker 1: I think there was definitely a part of the strategy
Speaker 1: that really just wanted to create additional uncertainty. I think
Speaker 1: a lot of people who have tried to size up
Speaker 1: this case suggest that Mr Musk is sort of fighting
Speaker 1: an uphill battle right now. I think the idea, you know,
Speaker 1: was probably first and foremost just to elongate the clock
Speaker 1: so that, you know, possibly more information could come out,
Speaker 1: so that there would be greater possibilities to mine into
Speaker 1: the spam account and body count data and possibly you know,
Speaker 1: pull a rabbit out of the hat where a rabbit
Speaker 1: really hasn't been there. Thus part now there's a second
Speaker 1: possible reason to try to elongate the proceedings, which is
Speaker 1: that Mr Musk's own financing, by its very terms, expires
Speaker 1: in the spring of two thousand twenty three, and if
Speaker 1: the financing expires of its own terms, that could potentially
Speaker 1: change a lot of the potential remedies that are available.
Speaker 1: It could make it harder, for example, to have a
Speaker 1: specific performance decree when there's no longer any financing in
Speaker 1: the picture. Briefly, what were each side's argument for Twitter
Speaker 1: for why it wanted an expedited trial and must for
Speaker 1: why he wanted to know until February. Yeah, I think
Speaker 1: that that the Twitter account was was relatively unsurprising in
Speaker 1: terms of of of where uh Twitter's lawyer Bill Sabbatt
Speaker 1: was going to. The expediting of a trial in a
Speaker 1: large commercial litigation cases actually pretty frequent in Delaware, particularly
Speaker 1: when it comes to UH, to these so called busted
Speaker 1: deal cases. You basically have to say, look, we've got, um,
Speaker 1: what's known as a colorable claim, which is a pretty
Speaker 1: low standard, because we've we've alleged some things that um,
Speaker 1: you know, if we improve them, they're gonna they're gonna
Speaker 1: hold water. Uh. And the second is that that they
Speaker 1: are ongoing uh suffering some type of an irreparable harm
Speaker 1: if they don't get resolution of the case. And uh,
Speaker 1: you know, in in many respects, both of those things were, uh,
Speaker 1: we're already out there kind of in the public domain.
Speaker 1: The colorable claim was relatively straightforward. And Uh, and the
Speaker 1: fact that you know, Twitter was kind of in this
Speaker 1: state of limbo for a long period of time and
Speaker 1: continues to be in the state of limbos. We don't
Speaker 1: know exactly what's happening with this deal means that employees
Speaker 1: may be leaving, that commercial clients may be leaving, that
Speaker 1: the user base may be growing uncertain about what uh
Speaker 1: to expect in terms of Twitter, and and and those
Speaker 1: are the types of arguments that Twitter's lawyers said, you know,
Speaker 1: really do justify expediting the process. Moreover, they said, you know,
Speaker 1: we we even in the merger agreement said you know,
Speaker 1: we're going to have a termination date in October. And
Speaker 1: that also is a signal that we wanted this resolved quickly.
Speaker 1: Must's attorneys, um, you know, somewhat unsurprisingly, said well, you know,
Speaker 1: we really want to make this case about how do
Speaker 1: you measure bought accounts? Now, Uh, there's a big issue
Speaker 1: about whether that's even going to be a central aspect
Speaker 1: of this case because you know, the contract itself doesn't
Speaker 1: really even talk about bought accounts, but certainly, UH, team
Speaker 1: Must has been trying to inject that into the picture,
Speaker 1: and to the extent they can. UH, Must's attorneys argued,
Speaker 1: you know, it's going to take a long time to
Speaker 1: try to vet all the data, to try to bring
Speaker 1: in experts to try to understand what's going on with
Speaker 1: the data. And so, you know, somewhat unavoidably, I think
Speaker 1: Must's lawyers, you know, kind of had to make the
Speaker 1: issue of you know, measuring bought accounts something that that uh,
Speaker 1: you know, um they could convince the judge was sort
Speaker 1: of a fore ordained challenge in this case. And uh
Speaker 1: and then the second thing that they that they argued
Speaker 1: is that you know, don't take don't read too much
Speaker 1: into this October termination date that we got into, uh,
Speaker 1: into the contract, because if you look into the terms,
Speaker 1: that that date just continues to get moved forward and
Speaker 1: pushed forward if there's litigation around UH this deal, which
Speaker 1: there now is. So really the the real deadline is
Speaker 1: the deadline for the financing in the spring of two
Speaker 1: thousand twenty three, and and none of those is a
Speaker 1: terrible argument. You know, I I think there is a
Speaker 1: sense in which, you know, the allegations about bought accounts,
Speaker 1: you know, even though they are in many ways peripheral
Speaker 1: to the contract, Musk's attorneys are definitely going to be
Speaker 1: trying to concentrate on that. So there are going to
Speaker 1: be additional arguments about that, and uh and the attorneys
Speaker 1: for for Mr Musk were actually pretty good, I think,
Speaker 1: in in in in you know, taking a little bit
Speaker 1: of the attention off of the idea that you know,
Speaker 1: we had to settle everything by this October termination day,
Speaker 1: just you know, the terms of the contract were a
Speaker 1: little bit more flexible to that. Did the judge give
Speaker 1: Twitter everything they were looking for? She largely gave the
Speaker 1: Twitter attorneys what they were looking for, but not quite.
Speaker 1: She said, Look, the proposed schedule that the Twitter attorneys
Speaker 1: have put forward is somewhat aggressive relative to what we've
Speaker 1: seen in past practice. She sort of surveyed other cases
Speaker 1: that you know, had been filed in similar situations and said,
Speaker 1: look at these other ones. You know, they're big, they're expensive,
Speaker 1: they're complicated, but we still are able to get them
Speaker 1: done between you know, sixty and ninety days and that's
Speaker 1: what I'm going to apply here as well. I don't
Speaker 1: see any reason why we have to use a different
Speaker 1: set of rules than has applied to these other cases.
Speaker 1: We now know how to adapt to COVID. If there's
Speaker 1: a spike and infections and we have to do things
Speaker 1: over zoom, we know how to do that as well.
Speaker 1: So I have great faith chance for McCormick set in
Speaker 1: the attorneys and the experts and my staff to pull
Speaker 1: this off just the way that we pull off any
Speaker 1: other type of busted deal case in the usual course
Speaker 1: of conducting our business. And that was significant, I think
Speaker 1: for a couple of reasons. One is that it does
Speaker 1: sort of suggest that Delaware wants to get back to
Speaker 1: its usual routines, because it's views those as being important
Speaker 1: for everyone who has an interest in Delaware law, in
Speaker 1: in large transactions and and applying Delaware law to it.
Speaker 1: I think the other reason that it was significant is
Speaker 1: that it suggested, you know, in a somewhat a preliminary way,
Speaker 1: but it still suggested that Chancellor McCormick was not going
Speaker 1: to be inclined to treat elon musk and specials or
Speaker 1: exceptional or you know, floating above the rules that pertain
Speaker 1: to everyone else. He's going to get exactly the same
Speaker 1: type of justice that anyone else would so with Twitter,
Speaker 1: and we're gonna, you know, see how this plays out
Speaker 1: over the next couple of months. So in many ways,
Speaker 1: the day was a good one for Twitter, not so
Speaker 1: good for Musk, but it was a very good day,
Speaker 1: I think for the Delaware court system as a whole.
Speaker 1: Did Chancellor McCormick give any hints about how she views
Speaker 1: this deal or what's important in the case. She was
Speaker 1: appropriately pretty guarded about expressing opinions about the underlying merits
Speaker 1: of the case. There are potentially a few things that
Speaker 1: do seem to leak out a little bit. She did
Speaker 1: specifically say that, you know, this looks like it's the
Speaker 1: type of case where specific performance would be appropriate. That
Speaker 1: money damages, you know, wouldn't compensate Twitter for all of
Speaker 1: the pain and harm and lack of closing deal. And so,
Speaker 1: you know, to the extent that there was, there is
Speaker 1: and has been a debate about whether Chancellor McCormick would
Speaker 1: be friendly to Twitter's requested relief of an injunction forcing
Speaker 1: the closing of this deal. I think she did sort
Speaker 1: of tip her hand a little bit to say, yeah,
Speaker 1: that looks like it would be an appropriate remedy in
Speaker 1: this case. And so you know, there was a little
Speaker 1: bit of a a sort of sort of movement at
Speaker 1: least in terms of people's predictions about whether she would
Speaker 1: embrace that or not. I think the second thing that
Speaker 1: it is much more implicit that comes out is that
Speaker 1: now that she has put these parties on you know,
Speaker 1: a leash that's only a couple of months long, to
Speaker 1: do all of their expert discovery, to do all of
Speaker 1: their depositions of fact witnesses, to do all of their
Speaker 1: document review, and all of their data review, it suggests
Speaker 1: that the bot counting exercise is going to have to
Speaker 1: be somewhat more limited than what team must wanted. You're
Speaker 1: not going to be able to, you know, pull out
Speaker 1: just mountains and mountains and mountains of data and be
Speaker 1: able to go over it and reach definitive conclusions about
Speaker 1: it in a couple of months time. These things you
Speaker 1: do take time for a full blown review of the data.
Speaker 1: So it is at least a little bit suggestive that
Speaker 1: Chancellor McCormick is probably going to cabin the fishing expeditions
Speaker 1: for bots a little bit and quite possibly concentrate a
Speaker 1: little bit more on exactly what was Twitter putting in
Speaker 1: their securities disclosures. They weren't writing about specific numbers of bots.
Speaker 1: They had a rough estimate, but but much of it
Speaker 1: was just sort of describing how they went about auditing
Speaker 1: their own system and that's the thing that is most
Speaker 1: testam in terms of whether those disclosures had fraudulent statements,
Speaker 1: And then did they actually audit their bot systems? Did
Speaker 1: the process that they have cohere with how they described
Speaker 1: it in their violing Twitter said that Musk willfully breached
Speaker 1: his obligation to make his best efforts to close the deal.
Speaker 1: Is that the standard is it best efforts? Well, they
Speaker 1: they put a standard into the contract itself, which which
Speaker 1: puts a duty of best efforts on Mr Musk. There
Speaker 1: is a parlor game in Delaware law, and there has
Speaker 1: been for many years about how courts should interpret various
Speaker 1: terms that use the word efforts. And there's a whole
Speaker 1: different set of lists of them best efforts, reasonable efforts,
Speaker 1: commercially reasonable efforts, commercially reasonable best efforts. The list goes
Speaker 1: on and on, and in some recent cases, the Delaware
Speaker 1: courts you know, haven't been willing to pick knits between
Speaker 1: those various types of of provisions. They basically said, look,
Speaker 1: you've got to demonstrate that you have tried and if
Speaker 1: there's evidence that you were either not trying or trying
Speaker 1: to sabotage the deal, that's going to violate your efforts
Speaker 1: obligation and and and and Twitter here, I think is
Speaker 1: on relatively solid cliff ground at least given the facts
Speaker 1: that are out there publicly that that that you know,
Speaker 1: that that that must not only was you know, very
Speaker 1: quickly trying to backtrack on the deal, but was even
Speaker 1: sort of engaged in uh you know, trying to get
Speaker 1: you know, the saf you to investigate Twitter and uh
Speaker 1: and was you know disparaging various uh, various employees and
Speaker 1: managerial actors within within Twitter. A lot of those are
Speaker 1: public um events that are are going to be you know,
Speaker 1: going to make for pretty good uh you know, documents
Speaker 1: and demonstratives in a in a judicial proceeding. Uh. And
Speaker 1: so so you know, the the key thing that that
Speaker 1: that Twitter needs to demonstrate is that, uh, that it
Speaker 1: was Musk who breached this contract, uh, not just by
Speaker 1: pulling the plug, by claiming he was going to terminate it,
Speaker 1: but by doing a bunch of this stuff. You know,
Speaker 1: all through this process, Musk's team is going to try
Speaker 1: to demonstrate that that no, it was Twitter that breached
Speaker 1: the contract because Twitter wasn't giving him all the information
Speaker 1: that he kept requesting and requesting and requesting. Uh. And
Speaker 1: you know, Twitter argues that, you know, we were complying
Speaker 1: with our obligations, that our obligations gave us some judgment
Speaker 1: about you know how granular we were going to have
Speaker 1: to be in providing him with information. And so what
Speaker 1: does this expedited schedule mean for the legal teams here?
Speaker 1: For both sides, this is now kind of an all
Speaker 1: hands on deck moment. So I would not be surprising
Speaker 1: to see delivery trucks with Diet Coke and Red Bulls
Speaker 1: backing up to the law firms that are having to
Speaker 1: push forward with all kinds of depositions, document to review,
Speaker 1: expert reports, and so forth. But this is not unusual
Speaker 1: in Delaware, even for large high profile cases. There are
Speaker 1: a lot of these large, high profile cases that end
Speaker 1: up taking this fast track to final adjudication. In fact,
Speaker 1: that's part of what Delaware advertises itself as providing for
Speaker 1: big transactions in which you know, delay um might mean
Speaker 1: death for the transaction or or uncertainty is you know,
Speaker 1: one of the worst things that you can have, and
Speaker 1: for longing that uncertainty is even worse. So there's a
Speaker 1: sense in which, yeah, there's a big transaction, but it's
Speaker 1: not an overly complicated transaction. Um. In fact, you know,
Speaker 1: a lot of the aspects of this transaction, uh, you
Speaker 1: know pretty much didn't leave very much to chance. And
Speaker 1: so yeah, that both sides are going to be spending
Speaker 1: a lot of effort to try to make out the
Speaker 1: best case that they can. But this case to the
Speaker 1: facts of this case, but the way that this contract
Speaker 1: were uh, doesn't suggest that it's going to be you know,
Speaker 1: rocket science to be able to pull this off. It's
Speaker 1: definitely the case that the party is gonna be working very,
Speaker 1: very hard. But these lawyers have gotten to the finish
Speaker 1: line countless times before is cases that had similar sets
Speaker 1: of facts, though not necessarily the huge size and big
Speaker 1: personalities that are involved here. Finally, you've been thinking that
Speaker 1: Twitter had the advantage here. Do you still think Twitter
Speaker 1: has the advantage? Yeah, I think that you know, Twitter
Speaker 1: seems to have been um in the driver's seat, even
Speaker 1: going into this proceeding the fact that they got pretty
Speaker 1: much what they wanted in terms of a shorter timeline.
Speaker 1: Playing the delay game, uh was was going to feed
Speaker 1: into the Musk team's uh sort of best case, and
Speaker 1: they they didn't get that. So, if anything, the decision
Speaker 1: by Chancellor McCormick, uh, you know, strengthened Twitter's position in
Speaker 1: this deal. Uh. And you know, we're gonna learn more
Speaker 1: and the parties themselves are gonna learn more, um as
Speaker 1: they go into this very very fast pace of discovery,
Speaker 1: and it may be that their own views about the
Speaker 1: case start to converge with one another and we may
Speaker 1: see a settlement here. You know. The personalities are big enough, however,
Speaker 1: that you know that this case could end up going
Speaker 1: all the way to litigation, which would uh you know,
Speaker 1: you know, happen in the last half of October. But
Speaker 1: that also is going to be a fairly quick trial
Speaker 1: five days um that are being calendared right now in
Speaker 1: the last couple of weeks of October. It looks like
Speaker 1: thanks so much, Eric, that's Professor Eric Talley of Columbia
Speaker 1: Law School. And that's it for this edition of the
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