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

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Speaker 2: The Justice Department's indictment of James Comy was riddled with

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Speaker 2: problems that may give the former FBI director legal grounds

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Speaker 2: to have it dismissed. And that's according to a federal judge.

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Speaker 2: Comy's been charged with making false statements and obstructing Congress

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Speaker 2: and Magistrate Judge William Fitzpatrick cited eleven potential missteps by

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Speaker 2: the Justice Department in the lead up to filing those charges,

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Speaker 2: including fundamental misstatements of the launch to the grand jury

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Speaker 2: by the prosecutor, Lindsay Halligan, and the use of potentially

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Speaker 2: privileged communications. And he's ordered an extraordinary remedy the release

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Speaker 2: of all grand jury materials to the defense. That's been

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Speaker 2: put on hold pending a review by the District Court

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Speaker 2: Judge Jimy his former federal prosecutor, Robert Mintz, a partner

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Speaker 2: maccarter in English, Bob In some ways, the judge's opinion

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Speaker 2: seems like a guideline for the defense to ask for

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Speaker 2: a dismissal of the indictment. He outlined the procedural and

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Speaker 2: substance of irregularities that occurred before the grand jury and

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Speaker 2: said they may give Comby legal grounds to have one

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Speaker 2: or more of the counts dismissed. Pretty harsh condemnation of

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Speaker 2: the government's actions.

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Speaker 3: It was extremely unusual, because it's extremely rare in the

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Speaker 3: first place for a judge to be reviewing conduct in

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Speaker 3: front of a grand jury. So what the magistrate judge

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Speaker 3: was pasked with in this circumstance was to decide whether

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Speaker 3: mister Comy had met the very high bar for a

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Speaker 3: defendant to be given full access to the transcripts and

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Speaker 3: recordings of a grand jury proceeding. What ended up happening

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Speaker 3: here was that, in addition to the reasons that Combe's

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Speaker 3: lawyers had argued for access to the grand jury matif,

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Speaker 3: the judge found from his own review of the materials

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Speaker 3: a host of new problems, new issues that could ultimately

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Speaker 3: lead to the dismissal of the case. The judge went

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Speaker 3: through a series of potential issues that he decided the

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Speaker 3: defense was entitled to probe and to raise before the

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Speaker 3: court as a basis to possibly dismiss the indictment. One

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Speaker 3: of the original issues that Comy's lawyers raised as a

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Speaker 3: basis for accessing the grand jury material had to do

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Speaker 3: with search warrants that were executed by the Department of

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Speaker 3: Justice in twenty nineteen and twenty twenty in connection with

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Speaker 3: an entirely separate, earlier investigation which took place during President

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Speaker 3: Trump's first presidency and had to do with the potential

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Speaker 3: leaking of information to the media about ongoing investigations by

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Speaker 3: the FBI, and the search warrants were focused on a

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Speaker 3: Columbia University law professor, Daniel Richman, who was a friend

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Speaker 3: of mister Comy's, but who would also end up repris

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Speaker 3: presenting him as his lawyer, and that created the question

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Speaker 3: of whether or not the information might have been covered

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Speaker 3: by the attorney client privilege. The judge here raised a

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Speaker 3: number of issues as to whether or not there could

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Speaker 3: have been a violation of mister Comy's rights, and whether

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Speaker 3: or not privileged information might have seeped into the grand

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Speaker 3: jury presentation and that would have been entirely improper and

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Speaker 3: would have tainted the presentation and could potentially be a

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Speaker 3: basist to dismiss the indictment.

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Speaker 2: So Bob the prosecutor here. The interim US Attorney Lindsay Halligan,

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Speaker 2: was Trump's former personal lawyer had never been a prosecutor before,

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Speaker 2: and she presented the case to the grand jury by herself.

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Speaker 2: It appears that she suggested to the grand jury that

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Speaker 2: the fact that Comy didn't testify in his defense should

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Speaker 2: be interpreted as a sign of guilt. Even a first

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Speaker 2: year law student should know that a defendant doesn't have

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Speaker 2: to testify.

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Speaker 3: Well, that's exactly, and the magistrate judge described these as

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Speaker 3: quote fundamental misstatements of law by the prosecutor in front

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Speaker 3: of the grand jury, and one of the issues that

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Speaker 3: he identified was this Fifth Amendment right issue. Apparently, during

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Speaker 3: the course of the grand jury at presentation, a grandeuror

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Speaker 3: raised questions, as grandeurs often do to the prosecutor, and

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Speaker 3: the prosecutor has to respond with the proper law in

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Speaker 3: order to give the grand jurors the framework by which

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Speaker 3: to consider whether or not to return an indictment. Here,

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Speaker 3: apparently a grandeuror asked a question, and as you say,

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Speaker 3: the exact response has been redacted. But according to the

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Speaker 3: magistrate judge, it suggested that mister Comy may have had

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Speaker 3: a burden to explain away the government's evidence. In other words,

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Speaker 3: the inference was that the burden shifted to mister Comy

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Speaker 3: to have to explain why he did what he did, when,

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Speaker 3: in fact, under the Fifth Amendment, a defendant has no

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Speaker 3: obligation whatsoever to testify, and the fact that they choose

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Speaker 3: not to testify cannot be used against him. And more fundamentally,

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Speaker 3: in a criminal prosecution, the burden never shifts to the defense.

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Speaker 3: It's always the prosecution's burden to prove its case beyond

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Speaker 3: a reasonable doubt. So any suggestion that mister Comy's decision

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Speaker 3: not to testify not to explain away his conduct could

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Speaker 3: somehow be used by grand jurors to infer that he

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Speaker 3: committed a crime would have been improper. The judge also

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Speaker 3: noted that Miss Halligan may have suggested to the grand

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Speaker 3: jury that they did not have to rely only on

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Speaker 3: the record that was presented to them during the grand

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Speaker 3: jury presentation in order to reach a finding of whether

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Speaker 3: or not there was probable cause, but that they could

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Speaker 3: assume and they could be assured of the fact that

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Speaker 3: the government had even more evidence, perhaps better evidence than

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Speaker 3: was presented to them during the presentation that could be

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Speaker 3: used at trial, and therefore that the case was even

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Speaker 3: stronger than the evidence presented to them during the grand

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Speaker 3: jury proceeding. If that was done, that too would be

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Speaker 3: entirely improper. The grand jury has to make a decision

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Speaker 3: as to whether or not there is probable cause based

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Speaker 3: solely on the evidence presented to them during the grand

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Speaker 3: jury proceeding. It's really no different than a trial in

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Speaker 3: which jurors have to make a determination as to whether

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Speaker 3: or not the government has met its burden of proof

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Speaker 3: beyond a reasonable doubt based solely on the evidence that's

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Speaker 3: presented to them during the trial. They can't rely on

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Speaker 3: anything outside of the record during the trial proceeding. The

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Speaker 3: same holds true for a grand jurors, and for a

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Speaker 3: prosecutor to just suggest that there is other more powerful

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Speaker 3: evidence that they should consider but has not been presented

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Speaker 3: to them would be entirely improper.

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Speaker 2: I mean her comments basically come down to a defendant

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Speaker 2: has to testify before a grand jury, and trust me,

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Speaker 2: grand jurors, we have a lot more evidence that will

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Speaker 2: prove his guilt, but we're not showing it to you now.

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Speaker 3: Well, I think that's why you saw the opinion written

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Speaker 3: by the magistrate judge to be as strongly worded at

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Speaker 3: as detailed as it was. It was a twenty four

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Speaker 3: page opinion that went through not only the issues that

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Speaker 3: mister Comey's lawyers had raised in order to try to

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Speaker 3: gain access to the grand jury transcripts, but also a

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Speaker 3: litany of other issues that he discovered when he reviewed

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Speaker 3: in camera those Grand Jury transcripts, and he raised serious

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Speaker 3: questions in his mind, I believe as to whether or

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Speaker 3: not there were serious constitutional errors in the presentation, not

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Speaker 3: only the Fifth Amendment question, not only the question that

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Speaker 3: there was evidence outside of the Grand jury's purview that

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Speaker 3: they should consider, even the way the Grand jury returned

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Speaker 3: the indictment. In this case, the original indictment presented to

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Speaker 3: the Grand jurors was a three count indictment. When the

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Speaker 3: Grand jurors went back to deliberate, they chose not to

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Speaker 3: return a true bill, which means they voted not in

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Speaker 3: favor of one of the recounts. And now there's a

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Speaker 3: question as to whether or not an entirely new indictment

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Speaker 3: with only the two counts that the Grand jurors voted

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Speaker 3: in favor of, was ever presented to them. If that

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Speaker 3: did not happen, if the Grand jurors did not deliberate

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Speaker 3: on the exact indictment that was ultimately presented to the court.

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Speaker 3: That is another issue that could be very problematic, and.

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Speaker 2: There's a lot of confusion about whether the grand jury

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Speaker 2: actually reviewed the final indictment or not, with Halligan first

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Speaker 2: saying and a hearing that they didn't and then in

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Speaker 2: court papers saying that they did.

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Speaker 3: During the hearing, the District Court judge was very clear

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Speaker 3: in asking the government whether the second indictment, containing only

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Speaker 3: the two counts that the Grand Jury voted in favor of,

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Speaker 3: was actually represented to all of the grand jurors, so

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Speaker 3: that they voted on the actual indictment that was ultimately.

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Speaker 4: Presented to the court.

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Speaker 3: At that time, the government said that the full indictment

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Speaker 3: was not presented, But now they've come back with evidence

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Speaker 3: in the transcript that suggests that perhaps it was repackaged

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Speaker 3: and presented to all of the grand jurors. So the

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Speaker 3: record on this question of whether the grand jurors actually

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Speaker 3: voted on the indictment that mister Commee is now facing

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Speaker 3: is muddled at best. At the end of the day,

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Speaker 3: the question of whether they voted on the actual indictment

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Speaker 3: or not is probably not the issue that's going to

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Speaker 3: drive the decision. The judge will more likely look at

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Speaker 3: some of the constitutional questions that have been raised by

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Speaker 3: Comey's defense team with regard to some of the comments

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Speaker 3: that were made during the grand jury process and make

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Speaker 3: a determination as to whether or not this indictment will

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Speaker 3: stand based upon those arguments, rather than this procedural question

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Speaker 3: about whether the proper indictment was presented to the full

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Speaker 3: grand jury. This is a prosecutor's nightmare. The case should

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Speaker 3: not be about the prosecutor's conduct right out of the gate.

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Speaker 3: It should be about the defendant's conduct and about whether

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Speaker 3: or not the government can prove that the defendant committed

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Speaker 3: a crime beyond a reasonable doubt. The probe into the

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Speaker 3: conduct by the government is exactly where you want to

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Speaker 3: be if you're on the defense side, but it's the

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Speaker 3: worst place you can possibly be as a prosecutor.

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Speaker 2: Yet another judge is involved in this case, and that's

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Speaker 2: the judge considering whether Lindsay Halligan was lawfully appointed.

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Speaker 3: The federal judge is actually a judge from South Carolina.

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Speaker 3: Because the question before the court is whether or not

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Speaker 3: the US Attorney for the Eastern District of Virginia has

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Speaker 3: been properly appointed, and the decision was made by the

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Speaker 3: Circuit Court that would be best to have a judge

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Speaker 3: not in that judicial district making this decision. So the

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Speaker 3: judge from South Carolina to Judge Curry is looking at

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Speaker 3: the convoluted process by which Lindsay Halligan was appointed as

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Speaker 3: the interim US Attorney for the Eastern District of Virginia.

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Speaker 3: There had been a career prosecutor who was appointed by

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Speaker 3: President Tromp to serve on an interim basis. That interim

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Speaker 3: basis lasts one hundred and twenty days. After that time period,

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Speaker 3: the judges in the district can then extend that appointment,

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Speaker 3: and that's exactly what happened here with that career prosecutor,

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Speaker 3: Eric Sebert. The Attorney General then fired mister Siebert and

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Speaker 3: appointed a new prosecutor, Lindsay Halligan, for a new one

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Speaker 3: hundred and twenty day period. And the question is whether

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Speaker 3: or not the Executive Branch can continue with these one

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Speaker 3: hundred and twenty day interim appointments sort of add infinitum,

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Speaker 3: or whether they can do it only one time and

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Speaker 3: after that time it's up to the district court judges

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Speaker 3: to appoint the US attorney.

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Speaker 2: There are so many interesting legal questions in this case.

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Speaker 2: Thanks Bob. That's Robert Mince of Macarter and English coming

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Speaker 2: up next. A huge win from Meta. I'm June Grosso

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Speaker 2: when you're listening to Bloomberg. A landmark antitrust decision on

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Speaker 2: Tuesday was a massive blow to the Federal Trade Commission

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Speaker 2: and a huge win for Meta, as it prevailed over

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Speaker 2: an existential challenge to its business that could have forced

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Speaker 2: the tech giant to spin off Instagram and WhatsApp. A

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Speaker 2: federal judge ruled that the FTC failed to prove that

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Speaker 2: those acquisitions allowed Meta to illegally monopolize the social networking market.

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Speaker 2: The question now is whether the government will even appeal

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Speaker 2: this significant loss, especially factoring in one dynamic. Meta CEO

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Speaker 2: Mark Zuckerberg has been courting President Trump.

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Speaker 4: We're going to work with President Trump to push back

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Speaker 4: on governments around the world.

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Speaker 1: They're going after American companies and pushing to censor more.

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Speaker 2: And it was Zuckerberg who was seated right next to

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Speaker 2: the President during a high profile dinner of technology executives

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Speaker 2: in September. My guest is antitrust expert Harry First, a

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Speaker 2: professor at NYU Law School, Harry, how big a blow

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Speaker 2: is this to the.

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Speaker 4: Ftc Well, it's a blow, all right. So this is

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Speaker 4: the first big loss in these high tech platform cases.

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Speaker 4: So two of them have now come to a conclusion

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Speaker 4: of the trial, you know, both against Google, both successful

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Speaker 4: for the Justice Department remedy another story maybe, So this

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Speaker 4: is the third. They're five total, and it's the first loss.

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Speaker 4: It's sort of not a surprising loss because this judge

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Speaker 4: has been skeptical of this case, clearly from the very beginning.

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Speaker 4: He had dismissed it originally, so he's been very skeptical,

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Speaker 4: and he said it in his opinions. So this case

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Speaker 4: has not been well received by the judiciary, shall we say,

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Speaker 4: So it's not surprising. The opinion itself is a little surprising,

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Speaker 4: but the result is not so surprising.

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Speaker 2: What do you say? The opinion is surprising.

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Speaker 4: So in two ways. First of all, he's taken a

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Speaker 4: very novel approach to time in the opinion. So he

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Speaker 4: says that the proof has to be as of the

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Speaker 4: time I make my decision. Almost, I mean, this is

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Speaker 4: an impossible standard. He said, maybe maybe they were monopoly,

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Speaker 4: Maybe this was a properly defined product, market in twenty

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Speaker 4: twenty when the suit was filed. But as time has

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Speaker 4: gone by, it's not that much time by now it's

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Speaker 4: not And the question is not whether it was then,

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Speaker 4: but whether it is now. I mean, if you take

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Speaker 4: that literally, that's a completely moving standard. You could never

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Speaker 4: try a case because your evidence is always outdated. I mean,

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Speaker 4: it's always about the past. You can't try a case

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Speaker 4: about the future. So that's a departure. He's got some

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Speaker 4: legal reasoning for why he does that, but that's a

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Speaker 4: serious problem, and I think it's a serious anti trust problem.

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Speaker 4: So there is that part of it. The second part

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Speaker 4: is this judge is very confident of his opinion. So

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Speaker 4: normally a district court judge, he's got seven things to

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Speaker 4: decide in front of him, and they proceed logically, well,

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Speaker 4: if if you go for this, you know, then you're done.

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Speaker 4: But if you go for this and it's okay, you

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Speaker 4: go to number two, three, four, five. So he has

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Speaker 4: a long trial, but he only decides the first issue. Now,

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Speaker 4: normally a judge would say, okay, here's what I decide.

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Speaker 4: This isn't a market. Market has to include such and such.

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Speaker 4: They don't really have monopoly power. Okay, but if I'm wrong,

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Speaker 4: here are the facts that I found about the conduct.

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Speaker 4: And the conduct wasn't any competitive. So even if you

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Speaker 4: had monopoly power, this was not exclusionary conduct, less than

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Speaker 4: any competitive And so you go through all the things

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Speaker 4: because if a court of appeals disagrees with you, now

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Speaker 4: what you've got to retry the whole case. So this

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Speaker 4: is a judge who thinks no one's going to disagree

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Speaker 4: with me man, And maybe maybe part of it is

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Speaker 4: because the narrative of the case is at least potentially

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Speaker 4: stronger than the market definition. So you know all the

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Speaker 4: emails about how Mark zuckerberg theory was to buy them

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Speaker 4: or bury them, and you know what he tried to

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Speaker 4: do with competitors and why he paid so much for

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Speaker 4: Instagram and for WhatsApp. WhatsApp drops out of this case

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Speaker 4: like right away, I don't know, third word or something.

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Speaker 4: He says, at some point, we're done with them, we

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Speaker 4: don't have to talk about them anymore. So that's pretty unusual,

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Speaker 4: I think, And it's either hubris or confidence, I don't

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Speaker 4: know which. But he does not do what I think

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Speaker 4: most district court judges would do, which is decide the

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Speaker 4: full case.

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Speaker 3: I thought the.

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Speaker 2: Focus would be on the market when Meta bought Instagram

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Speaker 2: and WhatsApp, and whether it was anti competitive conduct when

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Speaker 2: it's alleged that Meta couldn't compete with these two apps,

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Speaker 2: and Zuckerberg said it's better to buy than compete.

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Speaker 4: What he tried to say was, well, we've got to

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Speaker 4: do it as of now, in part because of the

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Speaker 4: FTC's remedy powers. They're asking for an injunction and they

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Speaker 4: can only stop conduct that is illegal now. So I've

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Speaker 4: got to decide what's illegal now. Now, he could have

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Speaker 4: very well said that's a remedy question. We'll decide that

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Speaker 4: when we get to remedy whether it's a continuing violation

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Speaker 4: or not. We should look at whether there was a

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Speaker 4: violation then. So, for example, if this were suit for damages,

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Speaker 4: you wouldn't say, well, we have to see whether it's

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Speaker 4: a violation today. You would say, let's see whether there

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Speaker 4: was a violation at the time that the offense was

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Speaker 4: committed and what damages were caused. So those two things

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Speaker 4: are are separate. So it's really quite odd, and you're right.

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Speaker 4: The argument that the Commission makes is that we look

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Speaker 4: at what they did and why they did it that

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Speaker 4: this was an effort to maintain their monopoly. These two

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Speaker 4: acquisitions for which they wildly overpaid. Why were they paying

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Speaker 4: nineteen billion dollars for a company that didn't have any

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Speaker 4: revenue that was What's app And the answer was they

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Speaker 4: didn't want them to develop into a compete social network platforms.

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Speaker 4: So you know, now that part also had problems that

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Speaker 4: had issues. You know, the Federal Trade Commission and its

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Speaker 4: earlier guys let those acquisitions go through, so there were

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Speaker 4: issues with it. So in that sense, that's a really

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Speaker 4: strange aspect.

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Speaker 2: As far as the definition of the market, the FDC

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Speaker 2: had argued that menas apps, Facebook and Instagram are primarily

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Speaker 2: used for personal social networking, while TikTok and YouTube are

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Speaker 2: video entertainment apps. But the judge rejected that and put

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Speaker 2: them all in one market.

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Speaker 4: Yeah, so the first question you have to show that

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Speaker 4: defendant has monopoly power in a relevant market. So he says, okay,

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Speaker 4: we have to start with market definition. So that's true,

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Speaker 4: that's the way it's normally done. And then he says, okay, yes,

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Speaker 4: let's look at the market. You know, he says, these

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Speaker 4: platforms have converged, these are all sort of similar and

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Speaker 4: particularly TikTok, you know, was posing a competitive threat. Says,

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Speaker 4: people don't want to talk to their friends anymore. They

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Speaker 4: just want unconnected videos. So, you know, TikTok comes along

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Speaker 4: and they're posing some threat, and Facebook responds with reels

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Speaker 4: short videos. And so that has now changed how we

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Speaker 4: define the market because users switch back and forth between

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Speaker 4: the two, and we have to include TikTok, and we

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Speaker 4: have to include YouTube or users switch to those videos later.

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Speaker 4: It's sort of at the end of the opinion, he says, well,

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Speaker 4: the argument for YouTube actually is a little thinner. But

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Speaker 4: even if it's just TikTok, that's enough. We would include

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Speaker 4: that in. However, we define the market, whatever we want

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Speaker 4: to call it doesn't really give it a name. And

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Speaker 4: at that point, if we include TikTok, then Meta does

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Speaker 4: not have monopoly power. TikTok takes away too much time.

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Speaker 4: All those kids are frittering where other time on TikTok.

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Speaker 4: That refrittering we're other time on Facebook. He had various

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Speaker 4: evidence of, you know, the willingness to switch, and that

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Speaker 4: people switch between those two. Now, the odd thing in

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Speaker 4: some ways is if so many people are switching, how

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Speaker 4: come so many people are still on Facebook. He gives

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Speaker 4: two hundred and forty million active users in the United

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Speaker 4: States and ad revenues of one hundred and sixty one

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Speaker 4: billion dollars. So when you read his description, it sounds

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Speaker 4: like this is a company that is just in the

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Speaker 4: throes of death from TikTok, and then he says, this

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Speaker 4: is an amazingly successful product. Give people a compelling product

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Speaker 4: for free, then sell ads that can be seen by millions.

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Speaker 4: I guess he thinks those are good. Two hundred and

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Speaker 4: forty million active users in the United States, it's a

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Speaker 4: lot of people. So apparently they haven't been dissuaded by TikTok,

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Speaker 4: which is also free, and you know they don't give

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Speaker 4: all their time there. They're still on Facebook. So the

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Speaker 4: argument from the government is that by incorporating Reels, they've

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Speaker 4: managed to defend their core business, and their core business

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Speaker 4: is social network putting people together, and they still get

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Speaker 4: a lot of people who like that product, even though

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Speaker 4: some people also use different products.

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Speaker 2: Harriet sounds like the government should appeal because of the

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Speaker 2: unusual way the judge defined the market. But this is

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Speaker 2: not an administration that always follows what's best for the

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Speaker 2: legal landscape. So might they decide not to appeal because

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Speaker 2: of political reasons?

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Speaker 4: Who knows exactly. It's hard to assess the political wins,

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Speaker 4: and the winds may go the other way because, you know,

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Speaker 4: a populist wing of the party feels that these platforms

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Speaker 4: have too much power and need to be cut down.

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Speaker 4: So who knows exactly. But if you look straight, it's

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Speaker 4: a legal issue. Is usually appeals from adverse decisions of

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Speaker 4: trial courts are hard to win on appeal because they're

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Speaker 4: mostly fact based, so you have to look for legal issues,

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Speaker 4: and there's a you know, an important legal issue of

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Speaker 4: you know, whether he applied the correct standard for defining

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Speaker 4: the market and for assessing when a violation occurred, And

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Speaker 4: that one's sort of a very pointed legal issue. How

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Speaker 4: it will fare in the court of appeals if they

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Speaker 4: do take it, I don't know.

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Speaker 2: And does this decision have any implications for the other

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Speaker 2: antitrust cases against tech platforms.

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Speaker 4: Yeah, that's a good question. Perhaps I'm thinking of Amazon

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Speaker 4: for example. So these are platform cases, and platform strategy

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Speaker 4: is you have a core product and what you want

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Speaker 4: to do is to keep people on the platform and

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Speaker 4: engaged because of the strength of the core product, and

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Speaker 4: you defend the core product by acquiring things around the

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Speaker 4: periphery that might challenge it, or by doing things. You know,

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Speaker 4: these companies are always subject to some competitive forces, even

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Speaker 4: if they're monopolis. So certainly Facebook was TikTok did pose

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Speaker 4: a competitive threat, and Amazon similarly has competitive threats to

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Speaker 4: which they respond. But the basic strategy is pretty similar,

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Speaker 4: and the market definition in some ways is similar because

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Speaker 4: they offer a bunch of different products in the same place,

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Speaker 4: much as supermarkets do, like whole foods for example. So

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Speaker 4: you have a you know, sort of core product and

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Speaker 4: then other things that they offer that other firms may

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Speaker 4: compete on. I mean, look at your smartphone, so thirty

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Speaker 4: five millimeters cameras compete on cameras, But you know, are

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Speaker 4: they in the same market. No, so you could say

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Speaker 4: this is quite similar. You know, yes, TikTok competes. I'm

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Speaker 4: surprised Twitter's not mentioned. Twitter competes, you know, to some

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Speaker 4: ext but these are all to some extent, and it's

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Speaker 4: still a meta defending its core product in which it

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Speaker 4: has a lot of power, as all advertisers know.

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Speaker 2: And there are more trials ahead as the government continues

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Speaker 2: to try to rein in big tech with antitrust suits.

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Speaker 2: Thanks so much, Harry. That's Professor Harry First of NYU

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

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Speaker 2: A loss for Texas in the nationwide redistricting battle that

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

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Speaker 2: You may remember back in July when President Donald Trump

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Speaker 2: pushed Texas Republicans to redraw congressional maps to give the

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Speaker 2: party five more seats to maintain its hold on the

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Speaker 2: House in the midterm elections.

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Speaker 1: Five. I think we get five, and there could be

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Speaker 1: some other states we're going to get another three or

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Speaker 1: four or five.

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Speaker 3: In addition, Texas would be the biggest one.

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Speaker 2: And Texas did kick off the nationwide mid decade redistricting

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Speaker 2: battle that's playing out in other states and in courtrooms

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Speaker 2: across the country. But could Trump's plan backfire? This week,

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Speaker 2: a panel of federal judges blocked the new map in

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Speaker 2: Texas and said the old map will have to be

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Speaker 2: used for the midterms. But on Friday, the state made

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Speaker 2: an emergency appeal to the Supreme Court asking it to

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Speaker 2: reinstate the newly drawn congressional map, and in just a

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Speaker 2: little over an hour, Justice Samuel Alito, who handles emergency

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Speaker 2: appeals from Texas, did just that. He temporarily blocked the

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Speaker 2: three judge panels ruling and restored the map. Alito asked

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Speaker 2: the opponents of the map to file a response by Monday,

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Speaker 2: signaling quick action by the court joining me. His elections

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Speaker 2: law expert Richard Brefalt, a professor at Columbia Law School,

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Speaker 2: rich this was a two to one decision with a

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Speaker 2: Trump appointee and an Obama appointee in the majority and

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Speaker 2: a Reagan appointee dissenting. Will you explain why the judges

436
00:26:12,359 --> 00:26:16,800
Speaker 2: decided that Texas couldn't use its new congressional plan.

437
00:26:17,600 --> 00:26:20,600
Speaker 1: In a nutshell, the court concluded that this was a

438
00:26:20,960 --> 00:26:24,480
Speaker 1: racial jerry mander and not a partisan jerrymander. And as

439
00:26:24,480 --> 00:26:26,480
Speaker 1: you know, the Supreme Court has said parts in jerry

440
00:26:26,480 --> 00:26:29,560
Speaker 1: manders are not unconstitutional, there's no basis for challenging them

441
00:26:29,600 --> 00:26:33,119
Speaker 1: in federal court. But racial jerry manders can be unconstitutional

442
00:26:33,320 --> 00:26:35,800
Speaker 1: and can be challenged in federal court. So the heart

443
00:26:35,840 --> 00:26:37,720
Speaker 1: of the Court's decision was that this was a racial

444
00:26:37,800 --> 00:26:40,879
Speaker 1: jerry mander. And what did they base that on? The

445
00:26:40,920 --> 00:26:43,600
Speaker 1: Court said what triggered this, Although we think of this

446
00:26:43,640 --> 00:26:48,200
Speaker 1: as Trump demanding more Republican seats from the Texas congressional delegation,

447
00:26:48,600 --> 00:26:52,480
Speaker 1: in the court's view, the Texas governor was initially reluctant

448
00:26:52,520 --> 00:26:55,719
Speaker 1: to call the special Section to create the map until

449
00:26:55,760 --> 00:26:58,600
Speaker 1: he got a letter from the Department of Justice in

450
00:26:58,800 --> 00:27:03,880
Speaker 1: Washington that said several of the Texas districts were unconstantly

451
00:27:04,080 --> 00:27:07,879
Speaker 1: created on racial grounds. In particular, the Department of Justice

452
00:27:07,920 --> 00:27:12,640
Speaker 1: focused on so called coalition districts, which are districts which

453
00:27:12,680 --> 00:27:17,239
Speaker 1: are majority minority, but not one particular minority group. And

454
00:27:17,320 --> 00:27:20,040
Speaker 1: for a period of time in the Fifth Circuit, courts

455
00:27:20,080 --> 00:27:22,240
Speaker 1: there had said that the Voting Rights Act could be

456
00:27:22,280 --> 00:27:25,800
Speaker 1: interpreted to require the so called coalition district district which,

457
00:27:26,119 --> 00:27:29,720
Speaker 1: let's say is forty percent Black and thirty percent Hispanic.

458
00:27:30,160 --> 00:27:32,239
Speaker 1: Neither one is a majority, but together they add up

459
00:27:32,240 --> 00:27:35,000
Speaker 1: to seventy percent. And so the Apartment of Justice says, well,

460
00:27:35,040 --> 00:27:38,399
Speaker 1: we see four districts in your current in your twenty

461
00:27:38,440 --> 00:27:41,760
Speaker 1: twenty one map that look like their coalition districts to us,

462
00:27:41,840 --> 00:27:44,199
Speaker 1: and based on a recent decision in the Fifth Circuit,

463
00:27:44,520 --> 00:27:47,280
Speaker 1: we think that makes them unconstitutional. So you got to

464
00:27:47,280 --> 00:27:49,919
Speaker 1: fix it, you've got to redo those districts. So what

465
00:27:50,000 --> 00:27:52,359
Speaker 1: the three judge panel in this case concluded is that

466
00:27:52,359 --> 00:27:55,320
Speaker 1: that was what was driving the redistricting. They looked at

467
00:27:55,320 --> 00:27:58,240
Speaker 1: the statements of the governor and of the leading members

468
00:27:58,280 --> 00:28:00,800
Speaker 1: of the state legislature, and they also looked at the

469
00:28:00,840 --> 00:28:03,840
Speaker 1: resulting map, and they pointed out that most of the

470
00:28:03,960 --> 00:28:08,439
Speaker 1: changes in the redrawn districts went from being so called

471
00:28:08,480 --> 00:28:12,479
Speaker 1: coalition districts, the districts in which one race or another

472
00:28:12,960 --> 00:28:16,280
Speaker 1: had a majority, and often an extremely narrow majority. They

473
00:28:16,320 --> 00:28:19,440
Speaker 1: said there were three districts they were either black or Hispanic,

474
00:28:19,520 --> 00:28:22,199
Speaker 1: where the majority group had like fifteen point two percent.

475
00:28:22,480 --> 00:28:26,280
Speaker 1: So they said the combination of the Department of Justice letter,

476
00:28:26,760 --> 00:28:31,080
Speaker 1: the governor's statement calling the legislature decision, in statements by

477
00:28:31,440 --> 00:28:33,919
Speaker 1: many of the leading members of legislature, and then the

478
00:28:33,960 --> 00:28:36,879
Speaker 1: districts that were created. In their minds, this meant that

479
00:28:37,040 --> 00:28:40,960
Speaker 1: race predominated the desire to create racial majority districts is

480
00:28:41,000 --> 00:28:43,560
Speaker 1: what was driving this. It's tub the court sent and

481
00:28:43,560 --> 00:28:46,320
Speaker 1: also clearly had partisan consequences in the nave and some

482
00:28:46,400 --> 00:28:49,960
Speaker 1: partisan motivation as well, But they said the dominant motive

483
00:28:50,040 --> 00:28:53,360
Speaker 1: that they found was race, and thatfore this made it

484
00:28:53,400 --> 00:28:55,080
Speaker 1: an unconstitutional racial jerry.

485
00:28:54,880 --> 00:28:58,800
Speaker 2: Matter, even though we know that President Trump really pushed

486
00:28:58,960 --> 00:29:03,560
Speaker 2: Texas Republics as he's continuing to push Republicans in other

487
00:29:03,680 --> 00:29:08,960
Speaker 2: states like Indiana and Kansas who've been resisting redistricting.

488
00:29:09,720 --> 00:29:12,480
Speaker 1: I think what you could say is that, to Barbary Shakespeare,

489
00:29:12,560 --> 00:29:14,960
Speaker 1: the Apartment of Justice was hoist by its own petard.

490
00:29:15,160 --> 00:29:17,480
Speaker 1: I think when this all began, it's now like four

491
00:29:17,480 --> 00:29:19,360
Speaker 1: months later, it's amazing how much has gone in four

492
00:29:19,400 --> 00:29:21,720
Speaker 1: or five months. When this all began, maybe people thought

493
00:29:21,720 --> 00:29:23,840
Speaker 1: it was too blatant to say this was all for

494
00:29:24,000 --> 00:29:26,840
Speaker 1: partisan reasons. I mean, we've now been totally partisan since

495
00:29:26,920 --> 00:29:29,239
Speaker 1: June of this year in the redistricting. But maybe they

496
00:29:29,280 --> 00:29:31,240
Speaker 1: thought it was just too blatant to say we're doing

497
00:29:31,240 --> 00:29:34,440
Speaker 1: different partisan purposes. So the Department of Justice trumped up

498
00:29:34,440 --> 00:29:37,520
Speaker 1: this racial argument. There was no argument actually that those

499
00:29:37,560 --> 00:29:41,320
Speaker 1: coalition districts were unconstitutional. You could argue that there's no

500
00:29:41,760 --> 00:29:44,960
Speaker 1: mandate that a state create them, and that's certainly true now,

501
00:29:45,440 --> 00:29:49,080
Speaker 1: but there was no evidence that they were unconstitutionally drawn. Nonetheless,

502
00:29:49,120 --> 00:29:52,160
Speaker 1: part of Justice having, i think, provided this kind of

503
00:29:52,360 --> 00:29:54,880
Speaker 1: pretext for the state to go ahead and do the

504
00:29:55,120 --> 00:29:58,760
Speaker 1: partisan gerrymander. But given that that was the stated reason

505
00:29:59,120 --> 00:30:01,040
Speaker 1: the court was able to we think it's a racial

506
00:30:01,120 --> 00:30:04,440
Speaker 1: gerry manner. They also made the point that the Democratic

507
00:30:04,480 --> 00:30:09,000
Speaker 1: districts which were undone mostly fell into this category of

508
00:30:09,040 --> 00:30:11,720
Speaker 1: coalition districts, and they pointed out there was one white

509
00:30:11,760 --> 00:30:15,200
Speaker 1: majority Democratic district which was barely touched. So they do

510
00:30:15,280 --> 00:30:19,520
Speaker 1: have some evidence suggesting that most of the focus of

511
00:30:19,520 --> 00:30:23,960
Speaker 1: the legislature was on coalition districts and making them majority

512
00:30:24,040 --> 00:30:27,000
Speaker 1: one race or the other. But I think what you've

513
00:30:27,000 --> 00:30:29,920
Speaker 1: got here is this irony that at least in June

514
00:30:30,000 --> 00:30:33,240
Speaker 1: of this year, the governor and the Department of Justice

515
00:30:33,240 --> 00:30:36,520
Speaker 1: thought it's too blatant to do it for purely partisan reasons,

516
00:30:36,640 --> 00:30:39,680
Speaker 1: so we're going to give them an anti race discrimination motivation,

517
00:30:40,160 --> 00:30:42,200
Speaker 1: and that, as I think, turned around to sort of

518
00:30:42,560 --> 00:30:43,360
Speaker 1: bite them in the rear.

519
00:30:43,520 --> 00:30:47,400
Speaker 2: At least for now, Texas is appealing to the Supreme Court.

520
00:30:47,880 --> 00:30:49,720
Speaker 2: What do you think will be the main question?

521
00:30:50,400 --> 00:30:52,680
Speaker 1: Well, I think the real question is will the Supreme

522
00:30:52,760 --> 00:30:56,720
Speaker 1: Court say that the lower court has made this decision

523
00:30:56,760 --> 00:30:59,120
Speaker 1: too close to the election. There's this doctrine called the

524
00:30:59,160 --> 00:31:02,360
Speaker 1: Percell principle, based on a Supreme Court decision now about

525
00:31:02,400 --> 00:31:05,120
Speaker 1: twenty five years old, in which the Court says that

526
00:31:05,280 --> 00:31:10,240
Speaker 1: federal courts should not undo state election laws if they're

527
00:31:10,280 --> 00:31:13,320
Speaker 1: too close to an election. The Court has never said

528
00:31:13,360 --> 00:31:15,920
Speaker 1: what is too close to an election, but there have

529
00:31:16,120 --> 00:31:19,240
Speaker 1: been some orders from the Supreme Court in recent years

530
00:31:19,680 --> 00:31:23,120
Speaker 1: that treated decisions that were within six months of an

531
00:31:23,160 --> 00:31:26,600
Speaker 1: election as too close to an election. And the Texas

532
00:31:26,640 --> 00:31:30,240
Speaker 1: primary is in March, so looking at some recent Supreme

533
00:31:30,280 --> 00:31:34,000
Speaker 1: Court decisions, there is a plausible argument that this Court's

534
00:31:34,040 --> 00:31:37,480
Speaker 1: decision is too close to the election and therefore should

535
00:31:37,480 --> 00:31:38,000
Speaker 1: be stayed.

536
00:31:38,480 --> 00:31:38,680
Speaker 4: Now.

537
00:31:38,760 --> 00:31:41,880
Speaker 1: The Court addresses that for about twenty pages, and they

538
00:31:41,920 --> 00:31:44,640
Speaker 1: make the point that the Texas plan was not signed

539
00:31:44,680 --> 00:31:47,720
Speaker 1: into law until the end of August, and if you

540
00:31:47,840 --> 00:31:50,400
Speaker 1: took the idea that six months is too late, it

541
00:31:50,480 --> 00:31:53,480
Speaker 1: was almost too late. As of the moment the Texas

542
00:31:53,520 --> 00:31:56,600
Speaker 1: redistricting was signed into law, it would have been impossible

543
00:31:56,960 --> 00:31:59,960
Speaker 1: to have a challenge, have the parties do the research

544
00:32:00,080 --> 00:32:02,920
Speaker 1: or have a hearing, and have a decision in time

545
00:32:03,360 --> 00:32:06,840
Speaker 1: to take something like six months. So the Court makes

546
00:32:07,000 --> 00:32:09,760
Speaker 1: kind of a strong pitch for saying that the percel

547
00:32:09,840 --> 00:32:12,600
Speaker 1: principle has to be handled flexibly. We've got to look

548
00:32:12,640 --> 00:32:15,960
Speaker 1: at how late the Texas legislature did this, and we

549
00:32:16,040 --> 00:32:17,560
Speaker 1: do have to say that it is possible to come

550
00:32:17,560 --> 00:32:21,520
Speaker 1: into compliance. They make two more points. One is that

551
00:32:21,720 --> 00:32:24,640
Speaker 1: the old map is still in existence, because Texas is

552
00:32:24,680 --> 00:32:27,880
Speaker 1: about to hold an election on that old map in January,

553
00:32:28,040 --> 00:32:30,680
Speaker 1: because there is a vacancy a member of the Texas

554
00:32:30,720 --> 00:32:34,120
Speaker 1: Commercial Delegation died early this year. There was just a

555
00:32:34,280 --> 00:32:37,800
Speaker 1: primary thing to fill that the general election to actually

556
00:32:37,840 --> 00:32:41,040
Speaker 1: fill that seat won't be until January. That's on the

557
00:32:41,080 --> 00:32:44,719
Speaker 1: old map, the pre Gerrymander map. And so the court says, well,

558
00:32:44,760 --> 00:32:47,360
Speaker 1: the old maps are still the law, so under our

559
00:32:47,400 --> 00:32:50,120
Speaker 1: preliminary injunction, we're just going to continue to live by

560
00:32:50,160 --> 00:32:51,880
Speaker 1: the old map. So the old map is still on

561
00:32:51,920 --> 00:32:54,200
Speaker 1: the books. And so they're saying that in some sense,

562
00:32:54,240 --> 00:32:57,720
Speaker 1: the real disruption was the state legislature's acting so late,

563
00:32:57,920 --> 00:32:59,440
Speaker 1: and so therefore we should be able to do this.

564
00:32:59,480 --> 00:33:02,200
Speaker 1: And yes, it's still time for everyone to come into

565
00:33:02,200 --> 00:33:05,360
Speaker 1: compliance to file under the old maps. I think the

566
00:33:05,400 --> 00:33:08,440
Speaker 1: first question maybe the stronger argument. What the Spreme Court

567
00:33:08,440 --> 00:33:12,840
Speaker 1: will do is unclear, but there is a plausible percel

568
00:33:13,440 --> 00:33:16,360
Speaker 1: argument that it's too late. But as I said, the

569
00:33:16,400 --> 00:33:20,240
Speaker 1: court is very strong in saying, well, if that's the case,

570
00:33:20,520 --> 00:33:24,240
Speaker 1: you can never bring a challenge to a gerrymander. That indeed,

571
00:33:24,240 --> 00:33:27,320
Speaker 1: it's an incentive to do the gerrymanders closer and closer

572
00:33:27,360 --> 00:33:30,160
Speaker 1: to the election to make it impossible to bring challenges.

573
00:33:30,480 --> 00:33:33,800
Speaker 2: If the Supreme Court says, forget the percell principle here,

574
00:33:34,080 --> 00:33:37,040
Speaker 2: how do you think they would rule on Texas's appeal.

575
00:33:37,400 --> 00:33:38,960
Speaker 2: You know that this was a part is in not

576
00:33:39,040 --> 00:33:41,440
Speaker 2: a racial gerrymander. Do you have any idea on that?

577
00:33:41,760 --> 00:33:43,600
Speaker 1: It's really hard to say. I mean, I think the

578
00:33:43,600 --> 00:33:46,840
Speaker 1: court acknowledges that there's evidence on the other side, but

579
00:33:46,960 --> 00:33:50,320
Speaker 1: they have in particularly the testimony of the map drawer,

580
00:33:50,360 --> 00:33:52,800
Speaker 1: the Republican specialist whoshire to draw the map. You said,

581
00:33:53,000 --> 00:33:54,680
Speaker 1: you know, no, I never looked at race data. The

582
00:33:54,720 --> 00:33:58,080
Speaker 1: Court said, we essentially don't believe you, partly because there

583
00:33:57,960 --> 00:34:01,000
Speaker 1: are discrepancies between your testimony the testimony of the state

584
00:34:01,080 --> 00:34:03,960
Speaker 1: legislator who hired you, but also because we just don't

585
00:34:03,960 --> 00:34:07,240
Speaker 1: believe that you could produce three districts that are fifty

586
00:34:07,280 --> 00:34:10,759
Speaker 1: point two fifty point three to fifty point four percent majority.

587
00:34:10,920 --> 00:34:13,359
Speaker 1: I think two were Hispanic, one was black. I'm not

588
00:34:13,400 --> 00:34:16,000
Speaker 1: sure about that and that's so precise, and you could

589
00:34:16,000 --> 00:34:18,799
Speaker 1: do it three times, and that you were not paying

590
00:34:18,800 --> 00:34:22,080
Speaker 1: attention to race. But I mean there is counter evidence.

591
00:34:22,520 --> 00:34:24,759
Speaker 1: You know, in theory, the Supreme Court's not supposed to

592
00:34:24,840 --> 00:34:27,399
Speaker 1: judge the evidence that's really for the lower court. They're

593
00:34:27,440 --> 00:34:30,640
Speaker 1: supposed to defer lower courts on evidentiary findings. But the

594
00:34:30,680 --> 00:34:33,640
Speaker 1: current Supreme Court has not always followed that rule, so

595
00:34:33,719 --> 00:34:35,560
Speaker 1: it's hard to tell what they're going to do.

596
00:34:36,040 --> 00:34:40,000
Speaker 2: As you know, California has approved a redistricting plan that

597
00:34:40,080 --> 00:34:45,040
Speaker 2: would offset the Texas Map, which is now in serious jeopardy.

598
00:34:45,400 --> 00:34:50,279
Speaker 2: Tell us about the legal challenge to California's redistricting from

599
00:34:50,400 --> 00:34:54,239
Speaker 2: California Republicans and also now the Trump administration.

600
00:34:54,800 --> 00:34:57,920
Speaker 1: I mean, they're basically making the same argument that prevailed here,

601
00:34:58,040 --> 00:35:01,000
Speaker 1: that this is a racial gerrymander. Mean, they can't bring

602
00:35:01,000 --> 00:35:03,719
Speaker 1: a parties in Jerrymenner argument because, as I said, the

603
00:35:03,719 --> 00:35:06,040
Speaker 1: Supreme Court in La Rouco case in I think twenty

604
00:35:06,120 --> 00:35:09,280
Speaker 1: nineteen said those are simply not just diiciable. He can't challenge.

605
00:35:09,280 --> 00:35:11,600
Speaker 1: So I think they're bringing a claim that the states

606
00:35:11,680 --> 00:35:15,719
Speaker 1: the legislature's motivation was race. Assumely they've targeted specific districts.

607
00:35:16,000 --> 00:35:17,839
Speaker 1: But I think the essence of it is that it's

608
00:35:17,840 --> 00:35:20,960
Speaker 1: a racial jerry mender. The basic idea is similar to

609
00:35:21,000 --> 00:35:24,439
Speaker 1: the argument that the three judge court in Texas recognized

610
00:35:24,480 --> 00:35:27,880
Speaker 1: and striking down the Texas jerrymander, only.

611
00:35:27,640 --> 00:35:31,080
Speaker 2: The jerry mander is sort of going in the opposite direction.

612
00:35:31,640 --> 00:35:35,960
Speaker 2: The Justice Department argued that California's map illegally bolsters the

613
00:35:36,080 --> 00:35:38,560
Speaker 2: voting power of Hispanics in the state.

614
00:35:38,960 --> 00:35:42,000
Speaker 1: Which is interesting because, of course, in Texas, one of

615
00:35:42,000 --> 00:35:44,120
Speaker 1: the arguments Governor Abbott made is that this is going

616
00:35:44,160 --> 00:35:47,480
Speaker 1: to actually strengthen the voting power of Hispanics, although he

617
00:35:47,520 --> 00:35:50,680
Speaker 1: combined that basically Hispanics are becoming more Republican and this

618
00:35:50,719 --> 00:35:52,960
Speaker 1: is going to allow them to be able to articulate

619
00:35:53,000 --> 00:35:55,520
Speaker 1: that in districts to both their preference and districts. He

620
00:35:55,560 --> 00:35:57,520
Speaker 1: had the sentence which kind of combined the two in

621
00:35:57,520 --> 00:36:00,640
Speaker 1: one sentence. So, I mean, much would turn on whatever

622
00:36:00,680 --> 00:36:03,480
Speaker 1: evidence they have for that. There's also an argument, there's

623
00:36:03,520 --> 00:36:05,520
Speaker 1: been a lot of debate about this amongst the law

624
00:36:05,520 --> 00:36:08,399
Speaker 1: professors as to what's the significance of the fact that

625
00:36:08,440 --> 00:36:13,200
Speaker 1: the California redistricting was approved by the voters. But the

626
00:36:13,320 --> 00:36:17,280
Speaker 1: challengers have to prove that the voters were racially motivated

627
00:36:17,320 --> 00:36:19,800
Speaker 1: as opposed to the legislature, and I think for grabs,

628
00:36:19,840 --> 00:36:23,239
Speaker 1: because the public campaigning was largely on party grounds. So

629
00:36:23,360 --> 00:36:26,840
Speaker 1: whether or not even if there was a racial motivation

630
00:36:26,920 --> 00:36:29,719
Speaker 1: within the legislature, whether that was some kind of washed

631
00:36:29,760 --> 00:36:32,400
Speaker 1: away by the voters, or whether if it really is

632
00:36:32,480 --> 00:36:36,720
Speaker 1: racially tainted, whether the legislature's motivation was racial pro hispanic,

633
00:36:37,080 --> 00:36:39,520
Speaker 1: whether it doesn't matter that the voters voted for it

634
00:36:39,520 --> 00:36:41,480
Speaker 1: because they thought that I'm putting on partisan grounds. That

635
00:36:41,520 --> 00:36:43,000
Speaker 1: will be an interesting fight.

636
00:36:43,160 --> 00:36:45,760
Speaker 2: You law professors have some interesting conversations.

637
00:36:46,200 --> 00:36:48,360
Speaker 1: Yeah, obviously it's been all online, but it's been an

638
00:36:48,400 --> 00:36:51,200
Speaker 1: interesting back and forth. Whereas the government on the plaintiffs

639
00:36:51,200 --> 00:36:53,840
Speaker 1: first have to show that the plan was racially motivated

640
00:36:53,960 --> 00:36:57,239
Speaker 1: and not partisanly motivated even within the legislature, and then

641
00:36:57,520 --> 00:36:59,839
Speaker 1: they conclude that it was partisan even the legislature, then

642
00:36:59,840 --> 00:37:02,080
Speaker 1: the effective of the voter as becomes irrelevant.

643
00:37:02,239 --> 00:37:05,880
Speaker 2: Thanks so much, rich and for sharing those professorial insights.

644
00:37:06,320 --> 00:37:09,960
Speaker 2: That's Columbia Law School professor Richard Breflt. And that's it

645
00:37:10,000 --> 00:37:12,600
Speaker 2: for this edition of the Bloomberg Law Show. Remember you

646
00:37:12,600 --> 00:37:15,120
Speaker 2: can always get the latest legal news on our Bloomberg

647
00:37:15,200 --> 00:37:18,799
Speaker 2: Law Podcast. You can find them on Apple Podcasts, Spotify,

648
00:37:19,000 --> 00:37:24,040
Speaker 2: and at www dot bloomberg dot com, slash podcast slash Law,

649
00:37:24,440 --> 00:37:27,000
Speaker 2: and remember to tune into The Bloomberg Law Show every

650
00:37:27,080 --> 00:37:30,960
Speaker 2: weeknight at ten pm Wall Street Time. I'm June Grosso

651
00:37:31,120 --> 00:37:32,719
Speaker 2: and you're listening to Bloomberg