WEBVTT - State Versus State on Taxes for Working From Home 0:00:00.480 --> 0:00:05.720 You're listening to Bloomberg Law with June Grasso from Bloomberg Radio. 0:00:08.039 --> 0:00:10.560 The U. S. Supreme Court is asking for the Biden 0:00:10.600 --> 0:00:14.520 administration's views on a state against state class over billions 0:00:14.520 --> 0:00:17.520 of dollars in income taxes paid by people who are 0:00:17.560 --> 0:00:21.280 working from home during the COVID nineteen pandemic. New Hampshire 0:00:21.280 --> 0:00:24.520 is seeking to sue Massachusetts directly at the High Court 0:00:24.840 --> 0:00:28.840 to challenge that state's practice of taxing nonresidents who used 0:00:28.840 --> 0:00:32.160 to work in Massachusetts but now do their jobs from home. 0:00:32.680 --> 0:00:35.760 Joining me is Michael Gratz, professor at Columbia Law School. 0:00:36.000 --> 0:00:38.880 It's the due process clause at the commerce clause. What's 0:00:38.880 --> 0:00:42.599 the legal issue here? Well, there were really two legal issues. 0:00:42.800 --> 0:00:46.280 I mean, one is it really has to do with 0:00:46.400 --> 0:00:49.760 whether the Court will take the case. That is, the 0:00:49.840 --> 0:00:54.680 Article three of the Constitution creates an automatic hearing in 0:00:54.720 --> 0:00:58.880 the Supreme Court to resolve a controversy between two or 0:00:58.880 --> 0:01:03.880 more states, and if this is in fact that then 0:01:03.920 --> 0:01:07.200 the Court would have to take the case, although I 0:01:07.240 --> 0:01:12.240 don't believe that it falls within Article three of the Constitution, 0:01:12.319 --> 0:01:15.280 So I think the Court has discretions to whether we'll 0:01:15.319 --> 0:01:18.399 hear this case. If it does. Here the case, the 0:01:18.440 --> 0:01:21.679 issue is really a commerce cause issue and a burden 0:01:21.720 --> 0:01:25.600 on interstate travel or interstate commerce, and usually they come 0:01:25.640 --> 0:01:29.160 up as commerce clause cases. You can find other places 0:01:29.160 --> 0:01:32.560 in the Constitution that are this case from, and nobody's 0:01:32.640 --> 0:01:35.840 yet really briefed it, so you know, it may be 0:01:35.959 --> 0:01:39.399 a privilege and immunities case under the fourteenth Amendment, but 0:01:39.560 --> 0:01:42.320 I think it's it's really a converse clause case. That's 0:01:42.360 --> 0:01:45.199 likely the way the Court will hear it. Let's talk 0:01:45.200 --> 0:01:48.600 first about the original jurisdiction of the Supreme Court. So 0:01:48.800 --> 0:01:51.400 just explain what it means that the Supreme Court has 0:01:51.440 --> 0:01:57.600 original jurisdiction cases between states. Well, the classic example, going 0:01:57.640 --> 0:02:00.160 back a long way, would be if one state it 0:02:00.240 --> 0:02:04.040 says that along the border, this piece of land or 0:02:04.120 --> 0:02:08.080 this much of a river is within that state's boundaries, 0:02:08.520 --> 0:02:11.679 and another state says, oh no, it's our land or river. 0:02:12.080 --> 0:02:14.400 Then that would be a classic case where the Supreme 0:02:14.400 --> 0:02:18.200 Court would have to resolve with its fute between the states. 0:02:18.240 --> 0:02:22.320 But here what we're really talking about is a problem 0:02:22.480 --> 0:02:27.640 of taxation, which is claimed by individuals that one state 0:02:27.840 --> 0:02:32.079 is over taxing or even though the states themselves after 0:02:32.360 --> 0:02:35.160 the case is claiming that it's going to lose a 0:02:35.160 --> 0:02:37.679 lot of revenue as a result of this because it 0:02:37.960 --> 0:02:40.960 gives a credit for the Massachusetts taxes, or in the 0:02:40.960 --> 0:02:43.320 case of the tri state area, we would be talking 0:02:43.320 --> 0:02:47.040 about New Jersey and Connecticut complaining that they're giving credits 0:02:47.080 --> 0:02:50.320 for New York taxes and New York is overreaching. But 0:02:50.400 --> 0:02:54.880 whether that's really within the original jurisdiction under Article three, 0:02:55.520 --> 0:02:59.160 I think there's some doubt about that. And so under 0:02:59.240 --> 0:03:02.760 Article three, if it were a dispute between the states, 0:03:02.919 --> 0:03:06.680 and obviously New Hamphire's claiming it's dispute between the states, 0:03:07.160 --> 0:03:09.480 the court would have to hear the case, but the 0:03:09.480 --> 0:03:14.600 court gets to decide it's interpretation of Article three. And 0:03:14.680 --> 0:03:17.040 if the court doesn't want to take the case, I 0:03:17.080 --> 0:03:19.920 think it has a basis for saying that this is 0:03:19.960 --> 0:03:23.919 not an Article three case, but instead it's a dispute 0:03:24.040 --> 0:03:28.120 between taxpayers and two states and who should be collecting 0:03:28.120 --> 0:03:32.520 their taxes, and that's the case that the taxpayers need 0:03:32.600 --> 0:03:34.680 to bring in it, and it's a case that the 0:03:34.680 --> 0:03:37.120 court may or may not want to hear, or the 0:03:37.160 --> 0:03:40.400 court may decide that because of the revenue units at state, 0:03:41.040 --> 0:03:44.240 New Hampshire has a right to be heard on the 0:03:44.320 --> 0:03:47.600 case and maybe a party, although I think that may 0:03:47.600 --> 0:03:50.760 be a stretch, But it's not an original jurisdiction case 0:03:50.880 --> 0:03:54.600 under under Article three. So the first question is will 0:03:54.640 --> 0:03:56.600 this case get to the court, Will the Court take 0:03:56.680 --> 0:03:59.880 this case? And that I think is a matter of for 0:03:59.840 --> 0:04:05.280 for some doubt, the Court refused the case where Texas 0:04:05.360 --> 0:04:09.840 was suing Pennsylvania over the elections. How difficult is it 0:04:09.880 --> 0:04:14.000 to get the court to get involved in states disputes 0:04:14.520 --> 0:04:18.200 right away in an original jurisdiction setting. Well, the Court 0:04:18.279 --> 0:04:20.520 doesn't like to be told that it must take a case, 0:04:21.800 --> 0:04:24.760 and so it often asks whether this is really a 0:04:24.800 --> 0:04:28.400 case of original jurisdiction, and it wants to limit those 0:04:28.480 --> 0:04:31.440 kinds of cases. The lawsuit that was filed by the 0:04:31.480 --> 0:04:36.200 Texas Attorney General about voting in Pennsylvania really presents, I 0:04:36.240 --> 0:04:38.760 think the clearest example of the kind of case that 0:04:38.960 --> 0:04:41.440 was the Preme Court certainly doesn't want to take and 0:04:41.640 --> 0:04:44.560 absolutely doesn't want to say they have to take under 0:04:44.680 --> 0:04:48.080 Article three. So I mean that's a good example of 0:04:47.800 --> 0:04:51.000 a case where the Supreme Court really didn't want to 0:04:51.000 --> 0:04:55.719 hear it, and just because it was by Texas against Pennsylvania, 0:04:56.200 --> 0:05:00.280 doesn't mean that it's a genuine conflict between the states. 0:05:00.480 --> 0:05:03.120 Was just claiming the Pennsylvania got its voting system wrong, 0:05:03.360 --> 0:05:06.960 And here New Hampshire is just claiming that Massachusetts is 0:05:07.360 --> 0:05:11.159 its tax system wrong, it is being unconstitutional and its 0:05:11.279 --> 0:05:14.440 exercise of its tax empower. So I think this is 0:05:14.480 --> 0:05:17.719 a case that the court can duck if it wants to. 0:05:18.120 --> 0:05:21.200 It could also say it's not original jurisdiction case, but 0:05:21.320 --> 0:05:23.000 we're going to hear it. We're going to grant the 0:05:23.080 --> 0:05:27.120 sarciary and take the case in this case because New Hampshire, 0:05:27.520 --> 0:05:30.520 the court would say, is a proper party to such 0:05:30.520 --> 0:05:32.760 a suit, and it makes sense to go ahead and 0:05:32.760 --> 0:05:35.560 hear it sooner or rather than later. A taxpayer to 0:05:35.600 --> 0:05:38.279 bring the case to the court, which is the normal 0:05:38.600 --> 0:05:41.960 in which these state tax cases get to the court. 0:05:42.320 --> 0:05:44.320 But this is not a court I think that's going 0:05:44.360 --> 0:05:47.360 to be anxious to get to a decision earlier rather 0:05:47.400 --> 0:05:50.480 than later, or create a precedent where a state can 0:05:50.520 --> 0:05:53.000 be a party in the lawsuit that really involves a 0:05:53.080 --> 0:05:56.160 dispute between an individual and the two states that are 0:05:56.440 --> 0:06:00.560 imposing taxes on him her. So let's go back to 0:06:01.000 --> 0:06:04.320 you said a commerce clause argument. What is New Hampshire's 0:06:04.440 --> 0:06:09.280 basic argument. Why is it suing Massachusetts. Well, it's basically 0:06:09.400 --> 0:06:16.240 suing on the ground that Massachusetts is imposing tax on 0:06:16.360 --> 0:06:22.120 New Hampshire residents who are not working in Massachusetts. They're 0:06:22.120 --> 0:06:26.000 doing their their work in New Hampshire. Now they may 0:06:26.040 --> 0:06:29.920 be doing it for an employer who's in Massachusetts, in 0:06:29.920 --> 0:06:32.640 which case New Hampshire is likely to lose that case 0:06:32.760 --> 0:06:35.839 based on prior president But but that's the claim. The 0:06:35.880 --> 0:06:40.799 claim is that New Hampshire's residents are being discriminated against 0:06:40.960 --> 0:06:46.280 because Massachusetts is overreaching its tax claim. Well that's what 0:06:46.400 --> 0:06:48.919 sort of hit me is because it seems from reading this, 0:06:49.120 --> 0:06:52.360 these are employees who were working in Massachusetts and then 0:06:52.520 --> 0:06:55.000 because of COVID, you know, they started working from their 0:06:55.000 --> 0:06:58.200 homes in New Hampshire. So if they're working for a 0:06:58.320 --> 0:07:03.320 Massachusetts company, you think that Massachusetts has a better case. 0:07:04.279 --> 0:07:06.920 I think Massachusetts has a pretty strong case. I mean, 0:07:07.080 --> 0:07:09.080 those those of us who live in the Tri state 0:07:09.160 --> 0:07:12.160 area know that New York certainly has for a long 0:07:12.240 --> 0:07:16.720 time taxed residents from New Jersey or Connecticut on the 0:07:16.760 --> 0:07:21.720 income they earned on New York employers, and New York 0:07:21.840 --> 0:07:25.280 certainly will come into this case on the side of Massachusetts, 0:07:25.360 --> 0:07:29.520 if if, if the court takes the case. Now, Massachusetts 0:07:29.600 --> 0:07:34.040 made this argument basically, this is an emergency measure. Let's 0:07:34.080 --> 0:07:37.080 just do this until we see what shakes out with COVID. 0:07:37.400 --> 0:07:41.880 Is that a good argument, Well, it depends on whose 0:07:41.880 --> 0:07:46.600 side you're on. Massachusetts is obviously concerned that at a 0:07:46.680 --> 0:07:51.640 time when the economy is struggling, people are able now 0:07:52.080 --> 0:07:56.800 to work for Massachusetts employers outside of Massachusetts of New Hampshire, 0:07:57.160 --> 0:07:59.760 a lot of people live across the border in their 0:07:59.800 --> 0:08:03.280 hand ture to avoid income taxes on on their other 0:08:03.320 --> 0:08:07.280 income and other taxes, and they're hipers. Notoriously a light 0:08:07.760 --> 0:08:11.800 taxation state, and Massachusetts back in the old days, used 0:08:11.840 --> 0:08:14.520 to be called tax a Chusets. They have a reputation 0:08:14.520 --> 0:08:17.400 of the higher and they are a higher tax state. 0:08:18.080 --> 0:08:20.800 So Massachusetts is concerned that all these people are now 0:08:20.840 --> 0:08:23.920 going to claim that they're not working in Massachusts are 0:08:24.080 --> 0:08:28.400 coming to Massachusetts and therefore Massachusts can't tax them. And 0:08:28.560 --> 0:08:31.760 you know, the usual rule is that the states have 0:08:32.080 --> 0:08:36.199 is that you're treated as being taxable as a statutory 0:08:36.320 --> 0:08:38.840 resident of the state that you're there more than a 0:08:38.880 --> 0:08:42.000 hundred eighty three days more than half a year. And 0:08:42.040 --> 0:08:45.640 here people who may have been routinely there in Massachusetts 0:08:45.960 --> 0:08:49.160 more than half the year are finding themselves spending little 0:08:49.240 --> 0:08:52.120 or no time in Massachusetts because they've left and are 0:08:52.160 --> 0:08:56.960 not coming back until the COVID emergency is behind us. 0:08:56.760 --> 0:09:00.840 It's just some ways in the future. And massachusettsbviously concerned 0:09:00.840 --> 0:09:03.160 that they may lose a lot of revenue the two 0:09:03.240 --> 0:09:05.960 or three years that that's going to take to get 0:09:06.080 --> 0:09:08.440 people back to work. And of course the other problem 0:09:08.559 --> 0:09:12.000 is that that given the fact that people like working 0:09:12.040 --> 0:09:13.640 at home, at least the ones who don't have young 0:09:13.720 --> 0:09:16.360 children are not in school, you know, may mean that 0:09:16.679 --> 0:09:19.880 more and more companies find it profitable to have people 0:09:19.960 --> 0:09:23.360 work from home rather than leasing or owning office rights 0:09:23.720 --> 0:09:27.720 in Massachusetts. So this pandemic is a long term threat 0:09:27.880 --> 0:09:33.000 to longstanding work relationships. Can a chord take into account? 0:09:33.040 --> 0:09:36.400 I mean, let's say, for example, New Jersey estimates it 0:09:36.440 --> 0:09:39.239 will credit as much as one point two billion dollars 0:09:39.280 --> 0:09:41.720 to its residents for income taxes paid to New York 0:09:41.720 --> 0:09:46.040 in the twelve months starting in March. Can the court 0:09:46.120 --> 0:09:49.840 take into account in any way the billions of dollars 0:09:49.840 --> 0:09:51.760 that some of these states will be losing or is 0:09:51.800 --> 0:09:56.240 that peripheral. Well, I don't know. I mean, I haven't 0:09:56.280 --> 0:09:58.600 looked at the numbers, and so I don't know whether 0:09:58.840 --> 0:10:03.240 New Jersey is telling if that's the total credit. I 0:10:03.280 --> 0:10:06.560 wonder what they've been crediting before the pandemic. There are 0:10:06.559 --> 0:10:08.760 a lot of New Jersey residents who are working in 0:10:08.800 --> 0:10:12.760 New York, as we all know well, and New Jersey 0:10:12.760 --> 0:10:17.000 has been crediting New York taxes on salaries that people 0:10:17.000 --> 0:10:19.320 are in New York for a very long time. So 0:10:19.400 --> 0:10:21.240 I don't know whether this is an additional at one 0:10:21.240 --> 0:10:24.240 point two billion, or whether it's what they've been where 0:10:24.240 --> 0:10:26.720 it includes what they've been doing all along. But but 0:10:27.040 --> 0:10:30.760 I'm sure the numbers are large. Um, But I think 0:10:30.800 --> 0:10:33.880 that you know, at least in the Tri state area 0:10:34.400 --> 0:10:40.200 and the Massachusetts New Hampshire border, the area surrounding the 0:10:40.240 --> 0:10:44.320 District of Columbia, it's quite common for people to work 0:10:44.320 --> 0:10:48.559 in one jurisdiction and live and another jurisdiction. And so 0:10:48.800 --> 0:10:51.640 that's not a new problem. And there are some Supreme 0:10:51.679 --> 0:10:54.920 Court jurisprudence on that, and the basic rule is that 0:10:55.080 --> 0:10:57.480 you can't treat the out of state or worse than 0:10:57.559 --> 0:11:00.440 you treat the in state or the doctor is that 0:11:00.559 --> 0:11:04.600 the state can't be internally inconsistent between in state and 0:11:04.640 --> 0:11:06.920 out in state. President, But I would say that New 0:11:06.960 --> 0:11:09.480 York would say, what, we're taxing our in state residents 0:11:09.520 --> 0:11:14.120 on your salaries, so we're not discriminating against out of states. 0:11:14.120 --> 0:11:18.120 So ignoring the jurisdiction question and just looking at the 0:11:18.200 --> 0:11:22.760 substantive issue, which state has the better argument, I'd rather 0:11:22.840 --> 0:11:25.600 answer the question which state is more likely to win 0:11:26.200 --> 0:11:29.120 um if the court takes the case, and I think 0:11:29.200 --> 0:11:32.679 Massachusetts is more likely to win just based on the 0:11:32.720 --> 0:11:36.400 precedence of the Supreme Court in allowing states a lot 0:11:36.440 --> 0:11:40.719 of flexibility about taxing income that the state regards as 0:11:40.760 --> 0:11:44.080 having been earned in their state because the employers in 0:11:44.120 --> 0:11:46.560 that state. So I think it's a long shot for 0:11:46.600 --> 0:11:49.520 the residents of New Hampshire to win this case. But 0:11:49.640 --> 0:11:52.760 it's even it's difficult to think that a resident of 0:11:52.800 --> 0:11:55.600 Hampshire is going to have to wherewithal to take a 0:11:55.600 --> 0:11:58.320 case like this to the federal courts and bring it 0:11:58.440 --> 0:12:01.720 up through the district core. It's a colored court can 0:12:01.800 --> 0:12:03.800 get to the Supreme Court, even if they thought the 0:12:03.800 --> 0:12:07.479 Supreme Court would take it. It's a very expensive litigation proposition, 0:12:07.920 --> 0:12:09.439 so this may be the only way it's going to 0:12:09.520 --> 0:12:11.640 get to the Supreme Court. And if the Supreme Court 0:12:11.760 --> 0:12:15.079 doesn't decide this, you know, then everybody's going to be 0:12:15.080 --> 0:12:17.600 in a bit of a mess. Congress is not going 0:12:17.640 --> 0:12:20.280 to do it. Congress can obviously step in and do 0:12:20.360 --> 0:12:23.599 this not to the commerce causing power, but they're not 0:12:23.640 --> 0:12:25.560 going to enter into this. And all you have to 0:12:25.559 --> 0:12:28.840 do is think about the political fight that there would 0:12:28.880 --> 0:12:32.240 be between the states where people are residing in the 0:12:32.280 --> 0:12:35.960 states where they're working. Why did the Supreme Court do 0:12:36.000 --> 0:12:40.880 you think ask the Solicitor General for her opinion. Well, 0:12:40.920 --> 0:12:43.960 I think what they'd like to hear from the Solicitor 0:12:44.080 --> 0:12:47.680 General is that this is not an Article three case 0:12:48.000 --> 0:12:51.720 of original jurisdiction which the Court must hear um and 0:12:51.800 --> 0:12:55.600 that would then bolster decision not to hear the case. 0:12:55.920 --> 0:12:59.319 And the Solicitor General's office historically is thought to be 0:12:59.640 --> 0:13:04.040 thought for and take into account institutional kinds of concerns, 0:13:04.160 --> 0:13:06.640 and so I think they're looking for an opinion from 0:13:06.640 --> 0:13:09.400 this of Ocester General and brief from the Sycester General 0:13:09.440 --> 0:13:11.880 saying this is not a case of a rich mo jorisdiction. 0:13:12.000 --> 0:13:16.120 Under Article three, you get to choose it or not conceivable. 0:13:16.360 --> 0:13:18.960 But let's listener. General would also argue that case needs 0:13:19.000 --> 0:13:21.480 to be brought by the taxpayer, not by the state. 0:13:21.880 --> 0:13:27.120 Thanks Michael, that's Michael Grat's of Columbia Law School. Leticia 0:13:27.240 --> 0:13:29.960 James is the first woman in the first black person 0:13:30.000 --> 0:13:32.559 elected to be the Attorney General of New York State. 0:13:33.120 --> 0:13:36.679 As Attorney General, James has filed or joined lawsuits against 0:13:36.720 --> 0:13:39.880 the Trump administration on issues such as immigrants rights and 0:13:39.920 --> 0:13:44.320 housing discrimination. She's also investigating the former president and his 0:13:44.400 --> 0:13:47.200 real estate business, in addition to leading a group of 0:13:47.240 --> 0:13:50.440 states in an anti trust suit against Facebook. Joining me 0:13:50.520 --> 0:13:53.680 is Eric Larson, Bloomberg legal reporter, who recently spoke to 0:13:53.800 --> 0:13:57.440 James about her tenure as a g Leticia James and 0:13:57.600 --> 0:14:01.560 the Attorney General of California, vir Be Sarah, are the 0:14:01.600 --> 0:14:04.240 two ages who have been in the lead on lawsuits 0:14:04.280 --> 0:14:07.880 against the Trump administration. Is that because they represent the 0:14:07.920 --> 0:14:11.920 biggest blue states or is it because they're aggressive? Well, 0:14:11.960 --> 0:14:14.439 I think it's a combination of both. Really, I mean 0:14:14.480 --> 0:14:19.080 the the as the Attorney General James says it, California 0:14:19.080 --> 0:14:21.080 and New York a kind of like the book ends 0:14:21.160 --> 0:14:24.880 of what she described as the resistance that the Blue 0:14:24.880 --> 0:14:29.360 state ages had against the Trump administration. I mean, these 0:14:29.400 --> 0:14:32.720 are two states with huge populations and obviously a lot 0:14:32.760 --> 0:14:34.800 of lawyers. In New York, for example, she has a 0:14:34.800 --> 0:14:39.000 team of seven hundred lawyers and over a thousand additional staff. Um, 0:14:39.160 --> 0:14:42.280 so they are working on there. They have the resources 0:14:42.360 --> 0:14:45.200 to be able to put together these huge lawsuits that 0:14:45.280 --> 0:14:47.400 a lot of other states join, or they do on 0:14:47.440 --> 0:14:50.520 their own, or they do in cooperation. So it really 0:14:50.560 --> 0:14:54.720 isn't a matter of those resources. Her lawsuits against Trump 0:14:54.960 --> 0:14:59.520 as president, where do they stand? Well? Those lawsuits of 0:14:59.600 --> 0:15:03.440 mostly been resolved, and she says that she filed I 0:15:03.480 --> 0:15:06.800 think about sixty five or so lawsuits against the Trump 0:15:06.800 --> 0:15:11.320 administration California. I remember they filed over a hundred and 0:15:11.320 --> 0:15:14.960 and Tis James says that she succeeded in about eighty 0:15:15.040 --> 0:15:18.120 five percent of those cases. So really, most of those 0:15:18.120 --> 0:15:20.080 cases that we've all been covering in the past several 0:15:20.160 --> 0:15:23.560 years are for the most part a sort of done, 0:15:23.840 --> 0:15:27.560 and the few that may still remain, it's it's likely 0:15:27.600 --> 0:15:29.920 that the Biden administration is going to take a different 0:15:29.960 --> 0:15:32.440 task on those but the big ones we already saw 0:15:32.480 --> 0:15:34.320 with like the the U. S. Census and the question 0:15:34.360 --> 0:15:37.480 about citizenship, that sort of thing. Um, those those who 0:15:37.600 --> 0:15:41.560 are already resolved. Much attention has been given to her 0:15:41.640 --> 0:15:47.000 investigation against Trump the Trump organization. First of all, describe 0:15:47.040 --> 0:15:52.800 what that investigation is concerned with. So the New York 0:15:52.800 --> 0:15:58.240 Attorney General is investigating the Trump organizations based in New York. UM. 0:15:58.320 --> 0:16:03.280 She opened the investigation after Trump's former lawyer, victor of 0:16:03.360 --> 0:16:07.800 Michael Cohen, gave the testimony in Congress outlining what he 0:16:07.880 --> 0:16:12.480 described as fraudulent conduct involving the valuation of assets that 0:16:12.640 --> 0:16:17.080 essentially gave financial benefits through taxes or bank loans to 0:16:16.840 --> 0:16:20.440 UH to the company. So she opened the investigation in 0:16:20.480 --> 0:16:24.720 two thousand nineteen in response to those remarks. Something she couldn't, 0:16:24.760 --> 0:16:27.840 you know, really ignore um and that that investigation was 0:16:27.920 --> 0:16:31.720 going along very quietly but wasn't really a public investigation, 0:16:32.000 --> 0:16:35.800 the civil investigation, and it sort of blew up into 0:16:35.800 --> 0:16:38.280 the public again because she had to file lawsuits to 0:16:38.440 --> 0:16:41.600 enforce some subpoenas in that case, which she won. But 0:16:41.720 --> 0:16:44.440 at any rate, the investigation is still ongoing. It's it's 0:16:44.440 --> 0:16:48.200 still at a fairly early stage. Is there any hint 0:16:48.320 --> 0:16:50.920 that she might let up on it because he's no 0:16:51.000 --> 0:16:55.600 longer president? Oh? Absolutely not. When I spoke with her, 0:16:55.720 --> 0:16:59.600 she said she fully intends to uh follow this investigation 0:16:59.640 --> 0:17:03.280 where where it goes. Um, you know there. Of course, 0:17:03.280 --> 0:17:07.560 she acknowledges that that President Biden and other some other 0:17:07.600 --> 0:17:09.760 Democrats have said that we want to move ahead and 0:17:09.840 --> 0:17:13.080 sort of have this unity and and let some some 0:17:13.240 --> 0:17:16.399 things go. That's not how she sees it in in 0:17:16.480 --> 0:17:19.919 any way. Um, And I think that if there is 0:17:19.920 --> 0:17:22.280 a case when their investigation is done, I don't think 0:17:22.280 --> 0:17:24.920 she's gonna have any problem bringing in Let's talk about 0:17:24.960 --> 0:17:27.920 the latest suit that drew a lot of attention, the 0:17:28.080 --> 0:17:32.479 n r A suit. What's that about? So when Si 0:17:32.680 --> 0:17:35.160 James was running for a g she had was very 0:17:35.160 --> 0:17:37.320 critical of the n r A. At one point she 0:17:37.359 --> 0:17:40.840 even called it a terrorist organization. Uh, so it wasn't 0:17:40.880 --> 0:17:46.120 too surprising that she has really looked into the organization. 0:17:46.720 --> 0:17:49.120 Uh the n r A of course, playing that all 0:17:49.160 --> 0:17:54.160 this attention is politically motivated, but her lawsuit really does 0:17:54.240 --> 0:17:58.480 stem from some internal dispute that blew up at the 0:17:58.640 --> 0:18:01.399 n r A came out into the public about allegations 0:18:01.480 --> 0:18:07.960 of financial shenanigans. So was their own internal uh fighting 0:18:08.119 --> 0:18:11.800 that sort of resulted in this lawsuit rather than something 0:18:11.840 --> 0:18:17.120 political on Tis James's part. That's the way she described it. So, Um, yes, 0:18:17.200 --> 0:18:22.000 they clearly are are very much opposed to they have 0:18:22.119 --> 0:18:25.200 very different views about guns. But the way that Tish 0:18:25.200 --> 0:18:29.400 Strange describes it, this is a purely following the law case. Um, 0:18:29.440 --> 0:18:33.240 it's a New York based charity organization that is suspected 0:18:33.560 --> 0:18:39.919 of violating charity laws by enriching pop executive. So she 0:18:40.040 --> 0:18:41.960 just says she's following the law and that it was 0:18:42.400 --> 0:18:45.560 the organization's own internal fighting that brought it to her attention. 0:18:45.960 --> 0:18:51.800 Has she gotten any blowback from Second Amendment activists about 0:18:51.840 --> 0:18:54.720 taking away their guns or anything like that when she 0:18:54.800 --> 0:18:58.480 filed this, Well, that's certainly what the n r A says, 0:18:58.480 --> 0:19:02.520 But she described the lawsuit is being filed on behalf 0:19:02.640 --> 0:19:05.680 of n r A members, people who have donated money 0:19:05.720 --> 0:19:08.880 to protect the Second Amendment, only to allege to see 0:19:08.960 --> 0:19:13.000 millions of those dollars end up going to luxury items 0:19:13.040 --> 0:19:15.600 and expenses for our top n r A executives, like 0:19:15.960 --> 0:19:18.800 vacations and yachts and things like this, trips all over 0:19:18.800 --> 0:19:22.480 the place for families and and whatnot. So Fish James 0:19:22.600 --> 0:19:26.119 has very different views about guns and these n r 0:19:26.160 --> 0:19:28.879 A members, but she says she's filed this lawsuit to 0:19:29.000 --> 0:19:32.440 protect them and to enforce New York laws protecting charities 0:19:32.480 --> 0:19:38.520 and donations. Eric or the Google and Facebook cases antitrust lawsuits. Yeah, 0:19:38.520 --> 0:19:42.320 you know, she's leading the Facebook UM lawsuits. It's been 0:19:42.359 --> 0:19:46.360 filed where she's one of many other states who has 0:19:46.440 --> 0:19:50.280 joined uh TO to Google. So they're two separate, two 0:19:50.320 --> 0:19:55.800 separate cases. UM. In the Facebook case that she's been leading, UM, 0:19:55.920 --> 0:19:59.800 it accuses the social media company of running a you know, 0:20:00.080 --> 0:20:04.400 monopolistic behavior by snapping up what it viewed as potential 0:20:04.520 --> 0:20:07.080 rivals like Instagram and what's that back when they were 0:20:07.080 --> 0:20:10.040 a lot smaller, you know, throwing huge amounts of money 0:20:10.040 --> 0:20:12.159 at them to get them on board, but basically just 0:20:12.200 --> 0:20:17.040 to stop them from becoming competitors. And the complaints alleges 0:20:17.520 --> 0:20:20.960 that that was in violation of federal anti trust law. 0:20:21.119 --> 0:20:23.480 And one of the potential things that they're speaking in 0:20:23.480 --> 0:20:26.400 the case is breaking up Facebook, which would be pretty remarkable. 0:20:26.440 --> 0:20:28.879 So that's UM a big apport she's got underway for 0:20:28.920 --> 0:20:31.479 this year. When you say they're leading the case, new 0:20:31.560 --> 0:20:33.800 York is leading the case. Does that basically mean that 0:20:33.880 --> 0:20:36.040 New York does all the work on it and the 0:20:36.080 --> 0:20:40.560 other states just joined in? Well, I think that it's 0:20:40.640 --> 0:20:44.080 it's sort of different for every UM, every multi state case. 0:20:44.400 --> 0:20:48.320 I'm not really sure exactly how they divide up the resources, 0:20:48.320 --> 0:20:50.919 but my understanding is that when when one of the 0:20:50.960 --> 0:20:53.520 states is leading it, that they are putting in most 0:20:53.560 --> 0:20:58.320 of you know, most of the the uh resources, financial 0:20:58.440 --> 0:21:02.440 and people or that sort of thing. So, UM, that's 0:21:02.480 --> 0:21:04.480 my understanding of how they break it up. What is 0:21:04.520 --> 0:21:06.920 she looking for? If Facebook came to her and said 0:21:06.960 --> 0:21:09.560 we'll do this, what would she want them to do 0:21:09.640 --> 0:21:12.760 in order to drop the suit? She would want to 0:21:12.800 --> 0:21:18.200 see the monopolists if the alleged the monopolistic behavior corrected. UM. 0:21:18.480 --> 0:21:21.720 As far as what options might be on the table 0:21:21.760 --> 0:21:24.040 for that to happen, I think it's too early to say. 0:21:24.080 --> 0:21:26.479 But that is why we we point to one of 0:21:26.520 --> 0:21:30.240 the the potential solutions that they outlined, which is to 0:21:30.400 --> 0:21:35.600 force Facebook to divest Instagram and what's that. UM. As 0:21:35.600 --> 0:21:37.959 far as what other possible measures they could come up 0:21:38.000 --> 0:21:42.320 with down the road, UH, it's pretty unclear at this point, 0:21:42.880 --> 0:21:47.480 did she handed any lawsuits she might be filing. No, 0:21:47.720 --> 0:21:53.000 that's definitely not her style. She does never ever do that. 0:21:54.440 --> 0:21:58.640 Being Attorney General is looked at as a stepping stone 0:21:59.359 --> 0:22:04.760 to being governor. Does she have those political ambitions? You know, 0:22:04.840 --> 0:22:09.040 that is something she does not talk about. When I 0:22:09.080 --> 0:22:11.280 first asked her about that, she just kind of laughed, 0:22:11.560 --> 0:22:13.399 you know, when I when I pressed her on the question, 0:22:13.480 --> 0:22:16.320 she said it's too early for her to make a 0:22:16.359 --> 0:22:19.120 decision like that. She acknowledged that the a G role 0:22:19.119 --> 0:22:21.679 in New York has been a setting stone for others 0:22:21.680 --> 0:22:24.240 to become governor, but she doesn't. She said that she 0:22:24.240 --> 0:22:27.359 doesn't know for sure if that's her path. Um. She said, 0:22:27.400 --> 0:22:29.560 for right now, she's going to be focusing on all 0:22:29.560 --> 0:22:32.760 of these lawsuits and investigations and that for now that's 0:22:32.840 --> 0:22:35.360 enough for her. Politicians don't usually want to talk about 0:22:35.440 --> 0:22:38.760 running for another office, but New York's current governor, Andrew 0:22:38.840 --> 0:22:41.720 Cuomo was the New York Attorney General before he ran 0:22:41.760 --> 0:22:45.480 for governor, and New York's former governor, Elliot Spitzer was 0:22:45.520 --> 0:22:48.359 the New York Attorney General before that, so there was 0:22:48.359 --> 0:22:51.439 a clear path from the Attorney General's office to the 0:22:51.480 --> 0:22:54.800 Governor's Office. Thanks for being on the show. Eric. That's 0:22:54.840 --> 0:22:58.200 Bloomberg Legal reporter Eric Larson. And that's it for this 0:22:58.400 --> 0:23:01.320 edition of the Bloomberg Lawn Podcast Best I'm June Grasso. 0:23:01.440 --> 0:23:04.119 Thanks so much for listening, and remember you can always 0:23:04.160 --> 0:23:06.920 get the latest legal news on our Bloomberg Launp podcast. 0:23:07.320 --> 0:23:10.680 You can find them on Apple Podcasts, Spotify, and wherever 0:23:10.800 --> 0:23:14.280 you get your favorite podcasts. You're listening to Bloomberg