1 00:00:02,759 --> 00:00:07,000 Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio. 2 00:00:09,000 --> 00:00:12,399 Speaker 1: A Supreme Court fight over the president's power to remove 3 00:00:12,560 --> 00:00:17,000 Speaker 1: independent agency members has been teed up. On Monday, in 4 00:00:17,040 --> 00:00:19,880 Speaker 1: a seven to four decision, the US Court of Appeals 5 00:00:19,880 --> 00:00:24,160 Speaker 1: for the DC's Circuit ruled that two independent agency members 6 00:00:24,400 --> 00:00:27,800 Speaker 1: could return to their jobs while they continued to challenge 7 00:00:27,840 --> 00:00:31,000 Speaker 1: President Trump's efforts to fire them. Well, it didn't take 8 00:00:31,080 --> 00:00:33,400 Speaker 1: long for Trump to go to the Supreme Court with 9 00:00:33,600 --> 00:00:38,560 Speaker 1: yet another emergency request today, asking the justices to allow 10 00:00:38,640 --> 00:00:42,760 Speaker 1: him to immediately fire the two National Labor Relations Board 11 00:00:42,800 --> 00:00:46,239 Speaker 1: member Gwyn Wilcox and Kathy Harris, a member of the 12 00:00:46,280 --> 00:00:50,520 Speaker 1: Merit Systems Protection Board. And late this afternoon, Chief Justice 13 00:00:50,640 --> 00:00:54,040 Speaker 1: John Roberts signed in order pausing that ruling by the 14 00:00:54,120 --> 00:00:57,600 Speaker 1: DC's Circuit Court of Appeals and asking the two officials 15 00:00:57,680 --> 00:01:02,080 Speaker 1: to respond to Trump's request by April fifteenth. My guest 16 00:01:02,160 --> 00:01:05,840 Speaker 1: is an expert in this area of law, Professor Carry Coliniesi, 17 00:01:05,959 --> 00:01:10,280 Speaker 1: who directs the University of Pennsylvania Law Schools Program on Regulation. 18 00:01:11,040 --> 00:01:13,720 Speaker 1: Carry start by telling us about the history of this case, 19 00:01:14,080 --> 00:01:15,520 Speaker 1: what's happened in the lower courts. 20 00:01:16,200 --> 00:01:20,280 Speaker 2: Well, the lower court decided that the president does not 21 00:01:20,480 --> 00:01:24,400 Speaker 2: have the power to fire the officers here at issue, 22 00:01:24,440 --> 00:01:27,920 Speaker 2: And we're talking about the two agency heads, Gwen Wilcox 23 00:01:28,560 --> 00:01:32,760 Speaker 2: from the National Labor Relations Board and Kathy Harris, a 24 00:01:32,800 --> 00:01:37,400 Speaker 2: member of the Merit Systems Protection Board, And the underlying 25 00:01:37,680 --> 00:01:41,760 Speaker 2: statutes setting up these agencies provide that the heads of 26 00:01:41,800 --> 00:01:48,000 Speaker 2: these agencies can only be removed for cause malfeasans misconduct, 27 00:01:48,600 --> 00:01:52,760 Speaker 2: something like that. Donald Trump comes along and says, sorry, 28 00:01:52,840 --> 00:01:58,640 Speaker 2: I'm firing you for no reason, really not showing any cause. 29 00:01:58,800 --> 00:02:02,920 Speaker 2: I just agree with maybe your approach to how you 30 00:02:02,960 --> 00:02:08,079 Speaker 2: want to take these agencies. That's something then that they challenged. 31 00:02:08,280 --> 00:02:10,760 Speaker 2: The lower court said the president doesn't have that power 32 00:02:11,240 --> 00:02:15,519 Speaker 2: because they're protected from removal at will. They can only 33 00:02:15,560 --> 00:02:19,560 Speaker 2: be removed by the president for good cause. And there 34 00:02:19,639 --> 00:02:22,680 Speaker 2: was a Supreme Court decision going back to nineteen thirty 35 00:02:22,720 --> 00:02:27,880 Speaker 2: five that says Congress can set up independent agencies and 36 00:02:28,639 --> 00:02:33,160 Speaker 2: protect them from presidents removing the heads of these agencies 37 00:02:33,600 --> 00:02:37,720 Speaker 2: at will for no reason whatsoever. So that lower court 38 00:02:37,800 --> 00:02:43,040 Speaker 2: decided to though put a hold on its order commanding 39 00:02:43,080 --> 00:02:47,639 Speaker 2: that the two dismissed officials be reinstated to their positions. 40 00:02:48,080 --> 00:02:51,320 Speaker 2: The case went up to the Court of Appeals. The 41 00:02:51,360 --> 00:02:55,000 Speaker 2: Panel of the Court of Appeals then was appealed further 42 00:02:55,120 --> 00:02:59,120 Speaker 2: to the en banc sitting of the US Court of 43 00:02:59,160 --> 00:03:02,800 Speaker 2: Appeals for the dist of Columbia Circuit. That's en bank 44 00:03:02,919 --> 00:03:07,840 Speaker 2: means the full Court and the DC Circuit just issued 45 00:03:07,880 --> 00:03:14,640 Speaker 2: a decision lifting the stay on the trial court's order 46 00:03:15,160 --> 00:03:19,720 Speaker 2: to reinstate these officials to their position, and it did 47 00:03:19,760 --> 00:03:24,280 Speaker 2: so on the similar grounds that the lower court held that. 48 00:03:24,680 --> 00:03:29,639 Speaker 2: There's this nineteen thirty five decision called Humphrey's Executor that 49 00:03:29,800 --> 00:03:34,160 Speaker 2: says Congress can create these good cause protections, and these 50 00:03:34,320 --> 00:03:39,480 Speaker 2: officials are protected from removal with these good protection clauses. 51 00:03:39,920 --> 00:03:44,560 Speaker 2: So the President in firing them acted. Therefore, we're going 52 00:03:44,640 --> 00:03:48,520 Speaker 2: to really force those officials back into office. They can 53 00:03:48,560 --> 00:03:51,320 Speaker 2: go back and take over their positions. 54 00:03:51,920 --> 00:03:56,000 Speaker 1: The majority said that the Supreme Court has repeatedly told 55 00:03:56,080 --> 00:03:59,720 Speaker 1: lower courts to follow precedents unless and until the Supreme 56 00:03:59,760 --> 00:04:04,000 Speaker 1: Court changes it, referring to Humphrey's Executor. There but the 57 00:04:04,080 --> 00:04:07,840 Speaker 1: dissent said, in doing so, the majority threatens to send 58 00:04:07,840 --> 00:04:11,040 Speaker 1: this court headlong into a clash with the executive. 59 00:04:11,760 --> 00:04:16,159 Speaker 2: Well, yeah, there's two issues really at stake here. One 60 00:04:16,320 --> 00:04:19,480 Speaker 2: is the question that we'd say is on the merits 61 00:04:19,720 --> 00:04:24,000 Speaker 2: whether what the president did was legal and whether Congress 62 00:04:24,040 --> 00:04:28,039 Speaker 2: had the constitutional power to make it illegal for a 63 00:04:28,040 --> 00:04:31,440 Speaker 2: president to remove certain officials that will So that's the 64 00:04:31,560 --> 00:04:35,039 Speaker 2: question on the merits, and the District of Columbia Circuit 65 00:04:35,080 --> 00:04:38,200 Speaker 2: Court here said, listen, you know, this is like really 66 00:04:38,240 --> 00:04:42,320 Speaker 2: a no brainer from the standpoint of this Humphreys Executor 67 00:04:42,560 --> 00:04:45,479 Speaker 2: decision still good law. It hasn't been overturned by the 68 00:04:45,480 --> 00:04:48,960 Speaker 2: Supreme Court. We have to follow it. That's one issue. 69 00:04:48,960 --> 00:04:52,240 Speaker 2: But the second issue is, then, Okay, once you say 70 00:04:52,360 --> 00:04:59,960 Speaker 2: that the president impermissibly and illegally removed these two officials, 71 00:05:00,240 --> 00:05:02,560 Speaker 2: what do you do about it as a court? And 72 00:05:03,240 --> 00:05:07,560 Speaker 2: the dissent by Judge Row said, you know, there's never 73 00:05:07,640 --> 00:05:12,240 Speaker 2: really been a remedy where a court has ordered officials 74 00:05:12,279 --> 00:05:16,520 Speaker 2: to be reinstated in the way that the DC Circuit 75 00:05:16,600 --> 00:05:19,960 Speaker 2: now has said the District Court could do. The Humphreys 76 00:05:20,040 --> 00:05:24,640 Speaker 2: Executor case from nineteen thirty five, for example, rose in 77 00:05:24,720 --> 00:05:29,560 Speaker 2: a dispute over acclaim for back wages. You know, the 78 00:05:30,200 --> 00:05:33,919 Speaker 2: court there said, okay, you know that was illegal to 79 00:05:34,040 --> 00:05:37,480 Speaker 2: remove what was then a member of the Federal Trade Commission. 80 00:05:38,040 --> 00:05:42,839 Speaker 2: Improperly for no reason, and the members actually a state 81 00:05:42,960 --> 00:05:46,359 Speaker 2: was entitled to back wages. This is totally different. Judge 82 00:05:46,400 --> 00:05:48,960 Speaker 2: Row says, it's totally different. You know, here we have 83 00:05:49,400 --> 00:05:54,880 Speaker 2: now a court ordering that officials who have been purportedly 84 00:05:54,920 --> 00:05:58,760 Speaker 2: fired by the president maybe illegally under current law. But 85 00:05:58,880 --> 00:06:03,240 Speaker 2: while this litigation pending, shouldn't we just as she says, 86 00:06:03,440 --> 00:06:07,760 Speaker 2: you know, keep things on hold and not force the 87 00:06:07,920 --> 00:06:12,880 Speaker 2: issue of reinstating these two officials and get this up 88 00:06:12,920 --> 00:06:16,360 Speaker 2: to the Supreme Court and let them decide. And if 89 00:06:16,400 --> 00:06:20,040 Speaker 2: at that point in time, the Supreme Court decides that 90 00:06:20,080 --> 00:06:24,520 Speaker 2: the president acted illegally, and the Supreme Court can decide 91 00:06:24,560 --> 00:06:27,760 Speaker 2: whether it's an appropriate remedy to force these folks back 92 00:06:27,960 --> 00:06:32,040 Speaker 2: into their positions. But right now it is certainly setting 93 00:06:32,160 --> 00:06:36,920 Speaker 2: up a real confrontation between an order from a lower 94 00:06:36,920 --> 00:06:40,480 Speaker 2: court judge and a president's order to fire these folks, 95 00:06:40,720 --> 00:06:45,719 Speaker 2: which one prevails. I think it's very clear and quite 96 00:06:45,720 --> 00:06:48,120 Speaker 2: certain that the Supreme Court is going to step into 97 00:06:48,160 --> 00:06:52,240 Speaker 2: this matter, and we will see what they do, probably 98 00:06:52,240 --> 00:06:56,160 Speaker 2: on the remedies front, pretty soon. And then the question is, 99 00:06:56,360 --> 00:06:58,719 Speaker 2: you know how long they'll take to decide the merits. 100 00:06:58,960 --> 00:07:02,120 Speaker 1: The Solicitor jen said, it intends to ask the Supreme 101 00:07:02,200 --> 00:07:07,159 Speaker 1: Court to overturn Humphrey's Executor, and that's a decision that 102 00:07:07,279 --> 00:07:11,880 Speaker 1: conservatives have been dying to get overturned for years. Do 103 00:07:11,920 --> 00:07:13,720 Speaker 1: you think it's on the chopping block. 104 00:07:14,080 --> 00:07:17,440 Speaker 2: Yeah, I think it is certainly going to be, you know, 105 00:07:17,600 --> 00:07:23,520 Speaker 2: an all probability modified, if not overturned entirely. The Supreme 106 00:07:23,600 --> 00:07:28,000 Speaker 2: Court has really for the last fifteen years been cabining 107 00:07:28,240 --> 00:07:32,440 Speaker 2: the scope of Humphrey's Executor through a number of decisions. 108 00:07:33,160 --> 00:07:38,040 Speaker 2: In one case saying that you couldn't have a double 109 00:07:38,120 --> 00:07:43,120 Speaker 2: layer of officials who have this good cause protection. That 110 00:07:43,240 --> 00:07:46,160 Speaker 2: was a decision in twenty ten, and then in twenty 111 00:07:46,280 --> 00:07:48,920 Speaker 2: twenty one, the Court said, well, you can't have a 112 00:07:49,120 --> 00:07:54,440 Speaker 2: single headed agency with a good cause protection. Fine, Phil 113 00:07:54,640 --> 00:07:58,680 Speaker 2: for these commissions or these boards that have multi members, 114 00:07:59,000 --> 00:08:02,880 Speaker 2: Humphrey's Executor still stands for those, but not for agencies 115 00:08:02,920 --> 00:08:07,960 Speaker 2: headed with just one person. The question is, though, if 116 00:08:08,520 --> 00:08:15,840 Speaker 2: Humphrey's Executor does go, what happens to a the Federal Reserve, 117 00:08:16,520 --> 00:08:22,160 Speaker 2: which I don't know. The Supreme Court and quite frankly, 118 00:08:22,400 --> 00:08:27,600 Speaker 2: this administration right now is saying that monetary policy still 119 00:08:27,680 --> 00:08:31,680 Speaker 2: can be kept independent We'll see how long the administration 120 00:08:31,800 --> 00:08:34,040 Speaker 2: takes that position, But I think the Supreme Court is 121 00:08:34,080 --> 00:08:37,600 Speaker 2: going to be certainly cognizant of what it could do 122 00:08:38,160 --> 00:08:44,080 Speaker 2: to the economy if the Federal Reserve Board loses its independence, 123 00:08:44,280 --> 00:08:48,680 Speaker 2: and the second issue as well, if Humphrey's executor goes, 124 00:08:48,920 --> 00:08:53,760 Speaker 2: what will happen to the protections for the civil service 125 00:08:54,000 --> 00:08:58,559 Speaker 2: and its independence. Maybe there's some ways that the Court could, 126 00:08:58,960 --> 00:09:03,160 Speaker 2: in overturning Humphrey's executor create a carve out for the 127 00:09:03,160 --> 00:09:07,880 Speaker 2: Federal Reserve Probably easier to see how it could still 128 00:09:08,200 --> 00:09:13,960 Speaker 2: keep the civil service protections intact. But we're just, you know, 129 00:09:14,080 --> 00:09:20,480 Speaker 2: really getting close to restructuring some fundamental aspects of US 130 00:09:20,600 --> 00:09:25,480 Speaker 2: government that we've had in place for nearly, you know, 131 00:09:25,600 --> 00:09:26,600 Speaker 2: ninety years now. 132 00:09:27,640 --> 00:09:30,360 Speaker 1: I mean, what does it say that the Appeals Court 133 00:09:30,559 --> 00:09:36,800 Speaker 1: voted seven to four the seven Democratic appointees blocking the 134 00:09:36,840 --> 00:09:41,840 Speaker 1: firing and the four Republican appointees including three Trump appointees, 135 00:09:42,320 --> 00:09:43,920 Speaker 1: giving a go ahead to the firing. 136 00:09:44,840 --> 00:09:51,400 Speaker 2: Listen, there's no question that these structural questions of administrative 137 00:09:51,440 --> 00:09:56,800 Speaker 2: governance have taken on a high level of ideological salience, 138 00:09:57,400 --> 00:10:01,839 Speaker 2: and it's certainly reflective in the judiciary as it is 139 00:10:01,960 --> 00:10:06,160 Speaker 2: in the polity at large. So you know, we definitely 140 00:10:06,240 --> 00:10:09,880 Speaker 2: have a good number of folks who have on the 141 00:10:09,960 --> 00:10:14,840 Speaker 2: political right been trumpeting the unitary executive theory now for 142 00:10:15,040 --> 00:10:18,520 Speaker 2: several decades, and this is sort of the logical extension 143 00:10:18,679 --> 00:10:22,240 Speaker 2: and maybe even some might say the last vestiges of 144 00:10:22,320 --> 00:10:27,000 Speaker 2: a holdout on the unitary executive theory. And you know, 145 00:10:27,040 --> 00:10:30,560 Speaker 2: I think it has some real consequences, and I think 146 00:10:30,600 --> 00:10:34,400 Speaker 2: this is what those who are concerned with how far 147 00:10:34,480 --> 00:10:39,720 Speaker 2: the Court might go if it does modify or ultimately 148 00:10:39,800 --> 00:10:42,640 Speaker 2: overturn humph result together. I mean, as I said, there's 149 00:10:42,679 --> 00:10:46,040 Speaker 2: real concerns about what it would do to the central 150 00:10:46,040 --> 00:10:50,280 Speaker 2: bank's independence. And there's an awful lot of really extensive 151 00:10:50,960 --> 00:10:55,160 Speaker 2: economic research that shows that countries that have central bank 152 00:10:55,200 --> 00:10:59,960 Speaker 2: independence do better economically, that that's an important thing to protect, 153 00:11:00,080 --> 00:11:04,280 Speaker 2: to preserve and not have monetary policy interest rates being 154 00:11:04,320 --> 00:11:07,520 Speaker 2: dictated by what might be in the short term political 155 00:11:07,559 --> 00:11:10,840 Speaker 2: interests of somebody in the White House of either party. 156 00:11:11,040 --> 00:11:16,479 Speaker 2: And there's also concern about you know, political control, presidents 157 00:11:16,520 --> 00:11:21,520 Speaker 2: having too much control over agencies like the Federal Communications Commission, 158 00:11:21,640 --> 00:11:26,680 Speaker 2: and you know, having power to make decisions that might 159 00:11:26,840 --> 00:11:32,400 Speaker 2: be reflective of their own political interests. There's the Federal 160 00:11:32,440 --> 00:11:37,280 Speaker 2: Elections Commission. Some of these agencies are ones that really 161 00:11:37,360 --> 00:11:41,920 Speaker 2: wield a considerable amount of power, and power that can 162 00:11:41,960 --> 00:11:47,120 Speaker 2: be directly relevant to somebody who's a politician and wants 163 00:11:47,160 --> 00:11:51,200 Speaker 2: to stay in office and use these powers not for 164 00:11:51,280 --> 00:11:53,880 Speaker 2: the good of the country, but for the good of 165 00:11:54,000 --> 00:11:57,480 Speaker 2: staying in office. And that's what's I think at stake 166 00:11:57,800 --> 00:12:02,080 Speaker 2: with this litigation here, and quite for there's other lawsuits 167 00:12:02,440 --> 00:12:07,199 Speaker 2: also pending with other officials of independent agencies who President 168 00:12:07,280 --> 00:12:10,000 Speaker 2: Trump has fired at will. So this is going to 169 00:12:10,040 --> 00:12:14,240 Speaker 2: the Supreme Court. It will be a blockbuster decision when 170 00:12:14,240 --> 00:12:17,600 Speaker 2: it comes out, and we'll have to see what kind 171 00:12:17,640 --> 00:12:21,200 Speaker 2: of waves it makes for the country and the future 172 00:12:21,240 --> 00:12:23,440 Speaker 2: of its governance. You know, is it going to be 173 00:12:23,760 --> 00:12:26,960 Speaker 2: just some heavy waves that we can navigate, or are 174 00:12:27,040 --> 00:12:31,360 Speaker 2: we unleashing a tsunami for the country where a president 175 00:12:31,440 --> 00:12:36,880 Speaker 2: can now wield control over some really important government agencies. 176 00:12:37,600 --> 00:12:43,160 Speaker 2: The president acting is if Humphrey's executor has already been overturned, 177 00:12:43,200 --> 00:12:46,839 Speaker 2: I mean, they've taken the position that, as you indicated, 178 00:12:46,920 --> 00:12:51,080 Speaker 2: they're going to argue in court, a Humphrey's executor should 179 00:12:51,120 --> 00:12:54,920 Speaker 2: be overturned. But in the meantime, the President has also 180 00:12:55,120 --> 00:12:59,000 Speaker 2: issued in executive order that says, listen, I'm going to 181 00:12:59,120 --> 00:13:03,960 Speaker 2: subject all all you independent agencies to white House review 182 00:13:04,000 --> 00:13:08,160 Speaker 2: of your regulations, white House review of your budgets, Department 183 00:13:08,200 --> 00:13:12,720 Speaker 2: of Justice review of your legal opinions and positions. We 184 00:13:12,760 --> 00:13:15,960 Speaker 2: want to have a say over your strategic planning. This 185 00:13:16,000 --> 00:13:20,920 Speaker 2: is all now happening, and it's unprecedented. Really, you know, 186 00:13:21,280 --> 00:13:25,160 Speaker 2: there's never been an administration that has acted as if 187 00:13:25,240 --> 00:13:30,920 Speaker 2: these independent agencies are no longer independent. And it's in progress. 188 00:13:31,120 --> 00:13:35,679 Speaker 2: These agencies are submitting their work for review by the 189 00:13:35,679 --> 00:13:39,760 Speaker 2: White House, and we're already in a world in which 190 00:13:40,040 --> 00:13:44,680 Speaker 2: there's an incredible degree of White House involvement to a 191 00:13:44,760 --> 00:13:49,160 Speaker 2: level we've never seen before. The only question is just 192 00:13:49,280 --> 00:13:52,760 Speaker 2: whether at the end of the day President's going to 193 00:13:52,800 --> 00:13:56,000 Speaker 2: be right that if there is some conflict ever between 194 00:13:56,240 --> 00:13:58,200 Speaker 2: the view of somebody at the head of one of 195 00:13:58,200 --> 00:14:01,840 Speaker 2: these agencies in the White House, the White House can 196 00:14:01,920 --> 00:14:05,800 Speaker 2: legally fire him. Right now, that's unclear, But like I said, 197 00:14:05,840 --> 00:14:08,840 Speaker 2: the administration's taking that position, and in this case and 198 00:14:08,960 --> 00:14:11,680 Speaker 2: others gone ahead and made those firings. 199 00:14:11,720 --> 00:14:13,000 Speaker 3: Anyway, it seems. 200 00:14:12,679 --> 00:14:16,320 Speaker 1: Like another big case at the Supreme Court. Thanks so much, Carrie. 201 00:14:16,480 --> 00:14:19,840 Speaker 1: That's Professor Carrey colinies He of the University of Pennsylvania 202 00:14:19,960 --> 00:14:24,160 Speaker 1: Law School. Coming up next, the Justice Department shuts down 203 00:14:24,280 --> 00:14:31,560 Speaker 1: its cryptocurrency fraud unit. This is Bloomberg. The Justice Department 204 00:14:31,680 --> 00:14:36,840 Speaker 1: is scaling back its cryptocurrency crime investigations to focus on 205 00:14:36,960 --> 00:14:42,440 Speaker 1: cases related to terrorism, drug cartels, victimizing investors in other 206 00:14:42,520 --> 00:14:48,560 Speaker 1: specific categories. The Department will no longer target virtual currency exchanges, 207 00:14:48,840 --> 00:14:54,400 Speaker 1: mixing and tumbling services, and offline wallets for unintentional violations 208 00:14:54,400 --> 00:14:59,240 Speaker 1: of regulations, and will also close existing investigations that don't 209 00:14:59,280 --> 00:15:02,800 Speaker 1: align with the new priorities. Joining me is an expert 210 00:15:02,880 --> 00:15:06,600 Speaker 1: in securities law, John George Arris of Aarris Law. So 211 00:15:06,680 --> 00:15:11,200 Speaker 1: tell us about this memo from Deputy Attorney General Todd 212 00:15:11,240 --> 00:15:15,200 Speaker 1: Blanche about scaling back cryptocurrency enforcement. 213 00:15:15,840 --> 00:15:19,120 Speaker 3: Torod Blanche and the Department of Justice have taken a 214 00:15:19,160 --> 00:15:24,560 Speaker 3: step away now from focusing on crypto enforcement, which was 215 00:15:25,480 --> 00:15:31,480 Speaker 3: a primary target of the Biden administration, and they've essentially said, listen, 216 00:15:31,520 --> 00:15:33,600 Speaker 3: the Department of Justice, we're not going to have this 217 00:15:33,760 --> 00:15:37,640 Speaker 3: crypto task force anymore. We're not looking at crypto is 218 00:15:37,640 --> 00:15:43,760 Speaker 3: a key area we're refocusing to issues like immigration issues 219 00:15:43,800 --> 00:15:48,200 Speaker 3: dealing with that and all human trafficking and that for now, 220 00:15:48,480 --> 00:15:52,160 Speaker 3: our priority is not looking at crypto that's created or 221 00:15:52,600 --> 00:15:56,960 Speaker 3: how its end users may take the product and then 222 00:15:57,120 --> 00:16:00,520 Speaker 3: use it for something illegal. They're still looking at fraud 223 00:16:00,600 --> 00:16:04,240 Speaker 3: obviously on a more broad level, or if any of 224 00:16:04,480 --> 00:16:07,520 Speaker 3: crypto ends up being used for something that fell into 225 00:16:07,520 --> 00:16:10,960 Speaker 3: those categories, let's say, you know, illegal human trafficking or 226 00:16:11,000 --> 00:16:13,800 Speaker 3: something like that. But it's really been a big step 227 00:16:13,960 --> 00:16:18,240 Speaker 3: by the government across the board, SEC included and the 228 00:16:18,240 --> 00:16:21,280 Speaker 3: Department of Justice to now take a step back and 229 00:16:21,640 --> 00:16:25,800 Speaker 3: say crypto is not something that we really even have 230 00:16:25,880 --> 00:16:29,240 Speaker 3: a regulatory framework for at this time, so it feels 231 00:16:29,240 --> 00:16:30,240 Speaker 3: like a hands off approach. 232 00:16:30,760 --> 00:16:33,280 Speaker 1: How could this affect, you know, the average consumer. 233 00:16:33,760 --> 00:16:37,200 Speaker 3: I think it's a buyer beware market now for crypto. 234 00:16:37,280 --> 00:16:40,720 Speaker 3: I think it's safe to assume that any company that's 235 00:16:40,840 --> 00:16:44,000 Speaker 3: based in crypto, or any individuals that are trying to 236 00:16:44,040 --> 00:16:47,080 Speaker 3: start a new crypto based business or launch a coin, 237 00:16:47,720 --> 00:16:51,200 Speaker 3: whatever it may be, fraud is still fraud, right lying 238 00:16:51,240 --> 00:16:54,520 Speaker 3: about something to induce some investment and taking that money 239 00:16:54,560 --> 00:16:57,480 Speaker 3: and misappropriating it or using it for themselves. I think 240 00:16:57,480 --> 00:17:01,000 Speaker 3: that's still on the table and something that could potentially 241 00:17:01,040 --> 00:17:04,160 Speaker 3: be looked at. It'll be consumer driven, right, people complaining, 242 00:17:04,560 --> 00:17:09,000 Speaker 3: people filing their own lawsuits through their attorneys going after it. 243 00:17:09,000 --> 00:17:12,280 Speaker 3: It does feel, however, though, that they're not going to 244 00:17:13,200 --> 00:17:15,800 Speaker 3: approach this in a way anymore where they're saying, hey, 245 00:17:15,840 --> 00:17:19,000 Speaker 3: this is security's fraud. Crypto is a security. We know 246 00:17:19,080 --> 00:17:23,080 Speaker 3: there was that huge case with Coinbase where the SEC 247 00:17:23,760 --> 00:17:27,480 Speaker 3: dropped its enforcement action against them on the basis that 248 00:17:27,640 --> 00:17:30,879 Speaker 3: Coinbase had challenged what they were engaged in was not 249 00:17:31,040 --> 00:17:34,399 Speaker 3: securities that crypto aren't. In fact, that the definition of 250 00:17:34,400 --> 00:17:38,000 Speaker 3: a security. So without a regulatory framework of where to 251 00:17:38,040 --> 00:17:42,880 Speaker 3: box this into what this digital asset actually is, fraud 252 00:17:43,200 --> 00:17:47,800 Speaker 3: is fraud. Wire fraud is fraud, Mail fraud is fraud. However, 253 00:17:48,119 --> 00:17:51,520 Speaker 3: that applies to everything right across the board, every single industry, 254 00:17:51,880 --> 00:17:56,119 Speaker 3: and crypto is no longer getting that special treatment or 255 00:17:56,160 --> 00:18:01,360 Speaker 3: that more intense look just because it's crypto. So it's 256 00:18:01,359 --> 00:18:04,160 Speaker 3: a more broad approach. You know, crypto by itself doesn't 257 00:18:04,240 --> 00:18:07,119 Speaker 3: raise a red flag anymore, which I think has really 258 00:18:07,760 --> 00:18:10,639 Speaker 3: freed up this industry. Not that long ago, you know, 259 00:18:10,720 --> 00:18:14,560 Speaker 3: under the Biden administration, crypto was under a heavy, heavy 260 00:18:14,600 --> 00:18:18,040 Speaker 3: attack across the board, whether it was the SEC or 261 00:18:18,080 --> 00:18:21,840 Speaker 3: the Department of Justice, that has all really been unwound. 262 00:18:22,160 --> 00:18:25,240 Speaker 3: And it's at the best of Donald Trump, who is 263 00:18:25,280 --> 00:18:28,920 Speaker 3: approaching his administration from a very very friendly crypto point 264 00:18:28,920 --> 00:18:29,240 Speaker 3: of view. 265 00:18:29,880 --> 00:18:34,200 Speaker 1: He's also issued his own crypto token just before taking office. 266 00:18:34,920 --> 00:18:37,400 Speaker 3: I think that was a big indicator of what regularly 267 00:18:38,040 --> 00:18:40,159 Speaker 3: was going to head and that quite a ton of 268 00:18:40,160 --> 00:18:44,160 Speaker 3: people by surprise, you know, myself included, but just following 269 00:18:44,240 --> 00:18:47,040 Speaker 3: across the industry that it was sort of the silent 270 00:18:47,119 --> 00:18:50,120 Speaker 3: launch of this I guess what's dubbed as a technically 271 00:18:50,119 --> 00:18:53,879 Speaker 3: a mean coin or just this token, that it was 272 00:18:53,920 --> 00:18:56,680 Speaker 3: just a Donald Trump token, as simple as that, and 273 00:18:56,720 --> 00:18:58,879 Speaker 3: he launched it. So I think that was an early 274 00:18:58,920 --> 00:19:04,000 Speaker 3: indicator for Austin, for the public at large that crypto 275 00:19:04,480 --> 00:19:08,840 Speaker 3: industry was going to be given much broader latitude than 276 00:19:08,880 --> 00:19:12,160 Speaker 3: it had been because things were getting really narrow and 277 00:19:12,240 --> 00:19:16,080 Speaker 3: if it was determined that the crypto industry was subject 278 00:19:16,240 --> 00:19:20,040 Speaker 3: to the regulatory framework of the securities in exchange industry, 279 00:19:20,560 --> 00:19:24,000 Speaker 3: that changes everything, right, that changes the barriers to entry, 280 00:19:24,359 --> 00:19:27,480 Speaker 3: that changes every aspect of that business, and how they 281 00:19:27,520 --> 00:19:31,640 Speaker 3: would deal with launching a coin. What exceptions they would 282 00:19:31,680 --> 00:19:33,960 Speaker 3: have to fit into, whether they would need to be 283 00:19:34,080 --> 00:19:37,520 Speaker 3: registered with the Securities and Exchange Commission is very complex. 284 00:19:38,080 --> 00:19:40,760 Speaker 3: So now I know people saw this term around a lot, 285 00:19:41,200 --> 00:19:43,560 Speaker 3: but you know, are we in the wild West of 286 00:19:44,000 --> 00:19:46,960 Speaker 3: crypto when it comes to regulation. I'd say yes. 287 00:19:47,840 --> 00:19:51,080 Speaker 1: And the person who's chosen to lead the SEC has 288 00:19:51,720 --> 00:19:55,080 Speaker 1: substantial investments in crypto. 289 00:19:55,760 --> 00:20:00,000 Speaker 3: Yes, this is an administration now that's saying crypto is 290 00:20:00,119 --> 00:20:04,439 Speaker 3: its own asset class. The SEC has put together a 291 00:20:04,480 --> 00:20:10,240 Speaker 3: team that's looking at a proposed framework for what would 292 00:20:10,280 --> 00:20:13,359 Speaker 3: go around this. Right What rules and regulations would they 293 00:20:13,359 --> 00:20:16,240 Speaker 3: have to have in place? Right now? We have anti 294 00:20:16,280 --> 00:20:20,760 Speaker 3: money laundering rules, we have fin send, we have very 295 00:20:20,800 --> 00:20:25,520 Speaker 3: basic money service businesses that you can be registered with 296 00:20:25,640 --> 00:20:29,040 Speaker 3: spin SEN and be regulated by the government. But we 297 00:20:29,160 --> 00:20:33,520 Speaker 3: don't have anything that's directly on points saying Okay, you're 298 00:20:33,680 --> 00:20:36,639 Speaker 3: selling a crypto, you're issuing a new crypto to the public, 299 00:20:37,040 --> 00:20:39,479 Speaker 3: you have to abide by these set of rules. So 300 00:20:39,520 --> 00:20:41,520 Speaker 3: I think the way that they're going to approach it 301 00:20:41,560 --> 00:20:44,840 Speaker 3: is I would say security is light. At some point. 302 00:20:45,040 --> 00:20:50,840 Speaker 3: If they do issue their regulations or proposed regulations around this, 303 00:20:51,480 --> 00:20:54,560 Speaker 3: they're really in my opinion going to take a less 304 00:20:54,600 --> 00:20:59,000 Speaker 3: stringent approach, which I don't know, may or may not 305 00:20:59,080 --> 00:21:02,480 Speaker 3: be good for consumers and may fall into the hands 306 00:21:02,520 --> 00:21:06,600 Speaker 3: of plaintiffs attorneys if there is fraud, to go after 307 00:21:06,640 --> 00:21:08,280 Speaker 3: it through the courts on their own. And I think 308 00:21:08,320 --> 00:21:10,800 Speaker 3: that was kind of a message from the SEC and 309 00:21:10,880 --> 00:21:13,560 Speaker 3: the Department of Justice. They're not going to put a 310 00:21:13,600 --> 00:21:15,880 Speaker 3: big enforcement focus on this anymore. 311 00:21:16,600 --> 00:21:19,560 Speaker 1: Do you think that the states will step in? Some 312 00:21:19,680 --> 00:21:22,120 Speaker 1: states have said that they are going to step in. 313 00:21:22,640 --> 00:21:23,400 Speaker 2: I think it's tough. 314 00:21:23,680 --> 00:21:26,680 Speaker 3: They could be preempted by federal walls, but obviously there's 315 00:21:26,680 --> 00:21:29,200 Speaker 3: no law on the books right now. If the state 316 00:21:29,560 --> 00:21:34,480 Speaker 3: is against not against crypto, but is skeptical of it, 317 00:21:34,560 --> 00:21:36,600 Speaker 3: or wants to put some rules around that, they could 318 00:21:37,160 --> 00:21:40,120 Speaker 3: It's quite complex and there's arguments against it too. I mean, 319 00:21:40,600 --> 00:21:44,280 Speaker 3: it's the free run of capital. It's allowing people to invest, 320 00:21:44,640 --> 00:21:48,040 Speaker 3: will put their money into a new asset class that 321 00:21:48,440 --> 00:21:51,760 Speaker 3: we've seen can generate extraordinary wealth. People could lose all 322 00:21:51,800 --> 00:21:55,280 Speaker 3: their money. Some states, I think, will be even more 323 00:21:55,320 --> 00:21:57,960 Speaker 3: crypto friendly and try to attract that business to them. 324 00:21:58,359 --> 00:22:02,760 Speaker 3: The ones that regular against it may be missing out 325 00:22:02,960 --> 00:22:06,840 Speaker 3: on those opportunities. Although I can see in some instances 326 00:22:06,920 --> 00:22:11,000 Speaker 3: then stepping in, but broadly right across the United States, 327 00:22:11,480 --> 00:22:16,119 Speaker 3: we've seen things that were once highly regulated and illegal 328 00:22:16,480 --> 00:22:20,320 Speaker 3: are now following free. For example, the cannabis industry right 329 00:22:20,400 --> 00:22:24,200 Speaker 3: we have a lot of legalizations and also with sports betting, 330 00:22:24,600 --> 00:22:26,760 Speaker 3: there's been widespread legalization of it. 331 00:22:26,920 --> 00:22:28,440 Speaker 2: So states view this. 332 00:22:28,400 --> 00:22:31,600 Speaker 3: As a potential to generate new tax revenue to support 333 00:22:31,640 --> 00:22:35,240 Speaker 3: other projects. Without federal regulations. On top of this, states 334 00:22:35,240 --> 00:22:39,120 Speaker 3: could create an attractive environment for crypto businesses to set 335 00:22:39,160 --> 00:22:41,359 Speaker 3: up there, as opposed to limiting that. 336 00:22:42,000 --> 00:22:45,040 Speaker 1: I mean, do you think that cases like that against 337 00:22:45,119 --> 00:22:49,320 Speaker 1: Sam Bekman freed would still be discovered and go forward 338 00:22:49,440 --> 00:22:50,600 Speaker 1: or they might be missed. 339 00:22:51,080 --> 00:22:53,000 Speaker 3: I think they'll likely be missed. I could say that, 340 00:22:53,280 --> 00:22:58,280 Speaker 3: you know, personally, I work as a defense attorney in 341 00:22:58,320 --> 00:23:04,080 Speaker 3: the white collar civil slash criminal space with a specific 342 00:23:04,160 --> 00:23:09,400 Speaker 3: focus on securities, and I've had investigations where I've represented 343 00:23:09,800 --> 00:23:13,359 Speaker 3: individuals related to crypto right in one way or another. 344 00:23:13,960 --> 00:23:17,480 Speaker 3: And during the Biden administration there were a lot of inquiries, 345 00:23:17,520 --> 00:23:20,040 Speaker 3: there were a lot of subpoenas, there was a lot 346 00:23:20,080 --> 00:23:22,560 Speaker 3: of trying to figure out what was really going on 347 00:23:22,640 --> 00:23:25,320 Speaker 3: in this industry. I can tell you that at the 348 00:23:25,400 --> 00:23:29,680 Speaker 3: tail end of that administration and into President's Trump administration, 349 00:23:30,119 --> 00:23:34,800 Speaker 3: it has been completely silent on ongoing investigations. So from 350 00:23:34,800 --> 00:23:39,480 Speaker 3: my perspective, I don't think it will be looked into. 351 00:23:40,200 --> 00:23:42,120 Speaker 3: I don't think they're going to issue subpoenas. I don't 352 00:23:42,119 --> 00:23:43,840 Speaker 3: think that they're going to be investigating it in the 353 00:23:43,880 --> 00:23:46,560 Speaker 3: same way. And you bring up something interesting with Sam 354 00:23:46,560 --> 00:23:50,840 Speaker 3: Bangmin free, who knows maybe his sentence maybe commuted, you know, 355 00:23:51,240 --> 00:23:53,240 Speaker 3: he maybe put in a position where he gets out 356 00:23:53,240 --> 00:23:57,240 Speaker 3: of jail much sooner in light of these very recent changes. 357 00:23:57,240 --> 00:24:01,640 Speaker 3: And we have a precedent for this was Ross Oldbrick, 358 00:24:01,720 --> 00:24:06,280 Speaker 3: who was the founder of Silk Road, which was sort 359 00:24:06,320 --> 00:24:09,000 Speaker 3: of the first I guess exchange for lack of a 360 00:24:09,040 --> 00:24:12,320 Speaker 3: better word, where you could utilize crypto to buy anything 361 00:24:12,520 --> 00:24:14,760 Speaker 3: you know on the Internet or on the dark web. 362 00:24:14,800 --> 00:24:17,919 Speaker 3: And he was sentenced to I think two lifetimes in prison, 363 00:24:18,040 --> 00:24:21,879 Speaker 3: like two hundred years, and when Trump got into office, 364 00:24:22,400 --> 00:24:25,359 Speaker 3: he pardoned him right away. He has been in jail 365 00:24:25,400 --> 00:24:28,720 Speaker 3: for ten years and now Ross Olbrick is free. So 366 00:24:28,920 --> 00:24:31,360 Speaker 3: I think in regards to your question, it may even 367 00:24:31,400 --> 00:24:32,520 Speaker 3: go one step further. 368 00:24:33,160 --> 00:24:35,240 Speaker 2: Not only will these not. 369 00:24:35,160 --> 00:24:39,600 Speaker 3: Be investigated, these type of crypto based frauds. We may 370 00:24:39,640 --> 00:24:42,800 Speaker 3: see people that have been prosecuted for them, like SBF, 371 00:24:43,840 --> 00:24:46,879 Speaker 3: get a reduced sentence and be set free. 372 00:24:47,160 --> 00:24:49,119 Speaker 1: Before I let you go, do you think any of 373 00:24:49,119 --> 00:24:51,879 Speaker 1: the cases you were handling that seemed to have stopped 374 00:24:52,600 --> 00:24:53,960 Speaker 1: could be started up again. 375 00:24:54,880 --> 00:24:58,800 Speaker 3: In my work, I've had really tense investigations with the 376 00:24:58,880 --> 00:25:03,120 Speaker 3: Department of Justice dealing with hundreds of millions of dollars 377 00:25:03,200 --> 00:25:08,000 Speaker 3: related to various crypto frauds that were out there that 378 00:25:09,160 --> 00:25:12,960 Speaker 3: completely stopped. I never got another follow up call again. 379 00:25:13,359 --> 00:25:17,440 Speaker 3: The investigations are, from what I understand, done. They don't 380 00:25:17,480 --> 00:25:21,360 Speaker 3: send the closing letter, but they're done, so I think 381 00:25:21,600 --> 00:25:23,600 Speaker 3: it really has changed. I was just speaking to a 382 00:25:23,600 --> 00:25:26,040 Speaker 3: friend of mine who's in the crypto industry, and it's 383 00:25:26,080 --> 00:25:29,080 Speaker 3: like a green light for any project they want to run. 384 00:25:29,160 --> 00:25:30,800 Speaker 3: The only thing you have to watch out for is, 385 00:25:31,160 --> 00:25:33,800 Speaker 3: you know, anti money laundering. Really just making sure that 386 00:25:33,840 --> 00:25:36,520 Speaker 3: the money that you're getting is from real people and not, 387 00:25:36,800 --> 00:25:38,879 Speaker 3: you know, from some illicit scam. 388 00:25:39,440 --> 00:25:42,919 Speaker 1: It all seems to be evolving very quickly. Thanks so 389 00:25:43,000 --> 00:25:45,919 Speaker 1: much for joining me on the show. That's John. George 390 00:25:46,000 --> 00:25:49,240 Speaker 1: Arris of Aris Law coming up next on the Bloomberg 391 00:25:49,320 --> 00:25:54,080 Speaker 1: law show the Justice Department suspended two lawyers involved in 392 00:25:54,119 --> 00:25:57,800 Speaker 1: the high profile case of a man deported to an 393 00:25:57,840 --> 00:26:02,639 Speaker 1: El Salvador prison because of an administrative error, a case 394 00:26:02,680 --> 00:26:06,959 Speaker 1: that illustrates the position government attorneys can now find themselves 395 00:26:06,960 --> 00:26:10,679 Speaker 1: in while facing the dual demands of loyalty to the 396 00:26:10,680 --> 00:26:17,720 Speaker 1: Trump administration and candor to the courts. The Trump administration 397 00:26:17,880 --> 00:26:23,200 Speaker 1: is facing a barrage of lawsuits challenging President Trump's executive orders, 398 00:26:23,600 --> 00:26:27,159 Speaker 1: some of which have already led to judges grilling Justice 399 00:26:27,160 --> 00:26:32,040 Speaker 1: Department lawyers who are defending their legal basis. The suspension 400 00:26:32,080 --> 00:26:36,280 Speaker 1: of two Justice Department lawyers in a high profile deportation 401 00:26:36,520 --> 00:26:41,000 Speaker 1: case illustrates the position government attorneys can find themselves in 402 00:26:41,320 --> 00:26:44,359 Speaker 1: while facing the dual demands of loyalty to the Trump 403 00:26:44,400 --> 00:26:48,960 Speaker 1: administration and candor to the court. Joining me is Bloomberg 404 00:26:49,080 --> 00:26:52,800 Speaker 1: Law reporter Justin Wise just In. The most high profile 405 00:26:52,880 --> 00:26:58,919 Speaker 1: cases so far are those that involve the deportations of 406 00:26:59,240 --> 00:27:02,320 Speaker 1: alleged venice a whale and gang members to prison in 407 00:27:02,480 --> 00:27:07,240 Speaker 1: l Salvador, and one case involves a legal challenge by 408 00:27:07,880 --> 00:27:11,520 Speaker 1: Abrego Garcia over his removal to a prison in l 409 00:27:11,640 --> 00:27:15,280 Speaker 1: Salvador where the government has admitted that he was sent there. 410 00:27:16,160 --> 00:27:19,720 Speaker 1: Tell us what happened at the April fourth hearing before 411 00:27:19,840 --> 00:27:21,480 Speaker 1: a Maryland federal judge. 412 00:27:22,240 --> 00:27:24,440 Speaker 4: Sure so, yeah, Like you said, this is a case 413 00:27:24,440 --> 00:27:28,200 Speaker 4: that involves instance where the US has admitted that they 414 00:27:28,280 --> 00:27:32,840 Speaker 4: made a mistake in including a Maryland resident on a 415 00:27:32,880 --> 00:27:36,359 Speaker 4: flight for alleged gang members to at L Salvador in prison. 416 00:27:36,560 --> 00:27:40,240 Speaker 4: During that hearing, the judge was pressing the US as 417 00:27:40,280 --> 00:27:43,199 Speaker 4: to why the US's position was that it could not 418 00:27:43,680 --> 00:27:47,920 Speaker 4: return this person to the US. In response to the 419 00:27:48,200 --> 00:27:52,520 Speaker 4: lawyer for the Justice Department representing the government said basically 420 00:27:52,560 --> 00:27:55,200 Speaker 4: that when the case landed on his desk, the first 421 00:27:55,200 --> 00:27:57,679 Speaker 4: thing he did was ask his clients that very question 422 00:27:57,840 --> 00:28:00,800 Speaker 4: that if they made that mistake, why was not able 423 00:28:00,840 --> 00:28:03,320 Speaker 4: to return him, and that he'd yet to receive an 424 00:28:03,720 --> 00:28:07,760 Speaker 4: answer that he found quote satisfactory, and that he also 425 00:28:07,880 --> 00:28:12,119 Speaker 4: conceded that the US had mistakenly deported this man to 426 00:28:12,320 --> 00:28:13,040 Speaker 4: El Salvador. 427 00:28:13,800 --> 00:28:16,400 Speaker 1: So how long did it take before he and his 428 00:28:16,480 --> 00:28:18,360 Speaker 1: boss were suspended? 429 00:28:18,720 --> 00:28:21,080 Speaker 4: It was the day after, so the hearing was on 430 00:28:21,119 --> 00:28:25,320 Speaker 4: April fourth. By April fifth, over the weekend, we had 431 00:28:26,040 --> 00:28:29,680 Speaker 4: reported that he and his boss were put on leave. 432 00:28:30,080 --> 00:28:33,720 Speaker 4: Some of the reasons. The exact specific reasons surrounding their 433 00:28:33,840 --> 00:28:37,840 Speaker 4: suspension are not totally clear, but in response to inquiry 434 00:28:38,200 --> 00:28:42,320 Speaker 4: about them, Attorney General Pambondi did release a statement saying 435 00:28:42,360 --> 00:28:46,120 Speaker 4: that all attorneys that her direction must zealously advocate for 436 00:28:46,160 --> 00:28:49,000 Speaker 4: the US and that those who failed to will quote 437 00:28:49,040 --> 00:28:50,240 Speaker 4: face consequences. 438 00:28:51,320 --> 00:28:56,000 Speaker 1: There are concerns about the kind of precedent this sets 439 00:28:56,400 --> 00:28:59,560 Speaker 1: to suspend a lawyer for telling the truth in court. 440 00:29:00,200 --> 00:29:01,920 Speaker 1: That's what lawyers are supposed to. 441 00:29:01,880 --> 00:29:05,280 Speaker 4: Do, right, I mean, it kind of gets to this 442 00:29:05,720 --> 00:29:11,040 Speaker 4: idea of zealous advocacy. When Attorney General Pambondi first arrived 443 00:29:11,080 --> 00:29:13,840 Speaker 4: to the Justice Department, she issued this memo that kind 444 00:29:13,840 --> 00:29:17,760 Speaker 4: of spelled out her expectations of the DOJ's lawyers in 445 00:29:17,840 --> 00:29:21,560 Speaker 4: regards to zealous advocacy on behalf of the president and 446 00:29:21,760 --> 00:29:25,640 Speaker 4: on behalf of the administration. And while vigorous advocacy on 447 00:29:25,680 --> 00:29:28,520 Speaker 4: behalf of a client is a core component of the 448 00:29:28,600 --> 00:29:32,440 Speaker 4: legal system, legal ethics experts and other lawyers I've spoken 449 00:29:32,480 --> 00:29:35,680 Speaker 4: to as well have brought up how the obligations are 450 00:29:36,320 --> 00:29:41,080 Speaker 4: balanced by a lawyer's other duties, namely exercising professional judgment 451 00:29:41,120 --> 00:29:44,560 Speaker 4: and of course being truthful to the court, and. 452 00:29:44,520 --> 00:29:50,800 Speaker 1: There have been several instances of exchanges between judges and 453 00:29:51,000 --> 00:29:56,720 Speaker 1: DOJ lawyers where either the DOJ lawyer couldn't give the 454 00:29:56,840 --> 00:30:01,160 Speaker 1: judge the information he or she was asking for, or 455 00:30:01,200 --> 00:30:03,000 Speaker 1: there was a conflict. Can you tell us about some 456 00:30:03,080 --> 00:30:03,680 Speaker 1: of those. 457 00:30:04,760 --> 00:30:07,720 Speaker 4: Right, Yes, this is by no means an isolated instance. 458 00:30:07,800 --> 00:30:11,560 Speaker 4: You know, so the Justice Department defends the administration in litigation, 459 00:30:11,760 --> 00:30:14,520 Speaker 4: and that means lawyers are being put in the position 460 00:30:14,600 --> 00:30:18,440 Speaker 4: of answering for a number of the executive orders from 461 00:30:18,480 --> 00:30:22,400 Speaker 4: the Trump administration that are subject to litigation, and judges 462 00:30:22,440 --> 00:30:25,360 Speaker 4: have in a lot of different scenarios been skeptical and 463 00:30:25,560 --> 00:30:29,360 Speaker 4: grilled lawyers over the certain orders, whether it's related to 464 00:30:29,440 --> 00:30:33,360 Speaker 4: birthright citizenship or an order that was barring transgender persons 465 00:30:33,400 --> 00:30:37,320 Speaker 4: from the military, as well as litigation involving Eon Musk's 466 00:30:37,680 --> 00:30:40,880 Speaker 4: actual role in the government efficiency effort. A judge had 467 00:30:40,960 --> 00:30:43,920 Speaker 4: told a lawyer that, you know, the answers he was 468 00:30:43,920 --> 00:30:48,120 Speaker 4: getting were quote, highly suspicious. So, you know, this episode 469 00:30:48,160 --> 00:30:51,520 Speaker 4: kind of speaks to the position a lot of lawyers 470 00:30:51,560 --> 00:30:54,240 Speaker 4: are in right now as they try to defend the 471 00:30:54,360 --> 00:30:57,440 Speaker 4: legal basis of a lot of these actions in the 472 00:30:57,480 --> 00:31:02,280 Speaker 4: face of really asking questions from judges who are liberating 473 00:31:02,320 --> 00:31:04,120 Speaker 4: over the legality of these orders. 474 00:31:04,320 --> 00:31:08,960 Speaker 1: Have any of the attorneys been sanctioned by judges. 475 00:31:08,480 --> 00:31:12,160 Speaker 4: To date, No, not today. There has been no instance 476 00:31:12,200 --> 00:31:15,120 Speaker 4: in which an attorney has been sanctioned that has yet 477 00:31:15,200 --> 00:31:16,880 Speaker 4: to come into play here. 478 00:31:17,160 --> 00:31:21,760 Speaker 1: DC Federal Judge James Boseburg was and perhaps still is, 479 00:31:21,880 --> 00:31:25,600 Speaker 1: considering a contempt order in the case where the Justice 480 00:31:25,640 --> 00:31:30,400 Speaker 1: Department did not obey his orders to turn two planes 481 00:31:30,440 --> 00:31:35,160 Speaker 1: around carrying hundreds of Venezuelan deportees. We'll see if he 482 00:31:35,240 --> 00:31:38,440 Speaker 1: goes forward with that, despite the fact that a Supreme 483 00:31:38,480 --> 00:31:42,160 Speaker 1: Court decision has said that those cases have to be 484 00:31:42,320 --> 00:31:47,480 Speaker 1: challenged in the jurisdictions where the detainees are located. These 485 00:31:47,560 --> 00:31:51,520 Speaker 1: kind of moves by the Justice Department suspending lawyers who 486 00:31:51,600 --> 00:31:56,360 Speaker 1: are being candid with judges could damage the Justice Department's 487 00:31:56,400 --> 00:32:01,240 Speaker 1: reputation as well as hurt the credibility of government lawyers. Right. 488 00:32:01,320 --> 00:32:05,160 Speaker 4: I spoke with a lawyer who once trained DOJ attorneys 489 00:32:05,200 --> 00:32:08,560 Speaker 4: on some of these like professional responsibility issues, and you know, 490 00:32:08,680 --> 00:32:11,680 Speaker 4: the idea is that when a lawyer is speaking before 491 00:32:11,720 --> 00:32:13,960 Speaker 4: the court, there's a lot of difference that judges are 492 00:32:14,200 --> 00:32:19,240 Speaker 4: giving lawyers, especially those representing the government and the you know, 493 00:32:19,280 --> 00:32:22,840 Speaker 4: the question becomes if the courts begin to have some 494 00:32:22,880 --> 00:32:26,560 Speaker 4: skepticism about the answers more skepticism about the answers they're 495 00:32:26,600 --> 00:32:29,000 Speaker 4: getting from the government, what's that mean for how they 496 00:32:29,320 --> 00:32:32,200 Speaker 4: deliberate and weigh in on the cases they're they're considering. 497 00:32:32,600 --> 00:32:35,200 Speaker 1: Can state bars do anything in this regard? 498 00:32:36,520 --> 00:32:40,160 Speaker 4: So what as I understand, just like how courts can 499 00:32:40,240 --> 00:32:44,080 Speaker 4: get involved on this and perhaps issue sanctioned state bars 500 00:32:44,360 --> 00:32:46,960 Speaker 4: can get involved and choose to respond. You know, I 501 00:32:47,360 --> 00:32:50,000 Speaker 4: know that just through you know, the normal course of 502 00:32:50,400 --> 00:32:55,160 Speaker 4: litigation and lawyering, really that complaints are filed to state 503 00:32:55,200 --> 00:33:00,240 Speaker 4: bars as well for a certain government official or private lawyer. 504 00:33:00,440 --> 00:33:03,480 Speaker 4: That those things are common practice in the legal industry. 505 00:33:03,720 --> 00:33:07,320 Speaker 4: So I do know that state bars certainly can as 506 00:33:07,360 --> 00:33:10,760 Speaker 4: far as whether they will or anything that we can 507 00:33:10,840 --> 00:33:13,800 Speaker 4: learn about them, those things are normally tightly guarded and 508 00:33:13,840 --> 00:33:17,120 Speaker 4: don't come out publicly until maybe a decision is reached 509 00:33:17,160 --> 00:33:20,560 Speaker 4: and when that decision actually involves the sanctioning of a lawyer. 510 00:33:20,840 --> 00:33:23,720 Speaker 4: So the details around that a bit hazy. 511 00:33:23,920 --> 00:33:26,920 Speaker 1: Tell me about the person who launched a group to 512 00:33:27,040 --> 00:33:29,640 Speaker 1: support DOJ employees. 513 00:33:29,600 --> 00:33:33,680 Speaker 4: That's right, So Stacey Young a long time DOJ lawyer 514 00:33:33,880 --> 00:33:36,800 Speaker 4: and alum of the Civil and Civil Rights Divisions, she 515 00:33:36,880 --> 00:33:40,000 Speaker 4: spent nearly two decades inside the Justice Department. She resigned 516 00:33:40,000 --> 00:33:43,560 Speaker 4: in January and launched a group called Justice Connection, which, 517 00:33:43,760 --> 00:33:46,560 Speaker 4: as she has said, is a designed to offer support 518 00:33:46,680 --> 00:33:50,720 Speaker 4: for DOJ employees come amid a time of massive upheaval 519 00:33:50,840 --> 00:33:54,920 Speaker 4: inside the department. In addition, it's clear that she's using 520 00:33:55,160 --> 00:33:58,120 Speaker 4: her role leading this group as a way to speak 521 00:33:58,160 --> 00:34:00,920 Speaker 4: out about some of the things going on inside inside 522 00:34:00,920 --> 00:34:04,160 Speaker 4: the administration and inside particularly the Justice Department, in the 523 00:34:04,160 --> 00:34:06,800 Speaker 4: ways from which it's shifting under Trump. 524 00:34:07,160 --> 00:34:09,640 Speaker 1: It seems like these lawyers, to use an old expression, 525 00:34:09,719 --> 00:34:12,480 Speaker 1: are stuck between a rock and a hard place as 526 00:34:12,520 --> 00:34:16,239 Speaker 1: they go into court. Thanks so much, Justin. That's Bloomberg 527 00:34:16,320 --> 00:34:20,439 Speaker 1: Law reporter Justin Wise, and that's it for this edition 528 00:34:20,480 --> 00:34:23,120 Speaker 1: of The Bloomberg Law Show. Remember you can always get 529 00:34:23,120 --> 00:34:26,279 Speaker 1: the latest legal news on our Bloomberg Law Podcast. You 530 00:34:26,320 --> 00:34:30,400 Speaker 1: can find them on Apple Podcasts, Spotify, and at www 531 00:34:30,560 --> 00:34:34,840 Speaker 1: dot Bloomberg dot com, slash podcast, Slash Law, and remember 532 00:34:34,840 --> 00:34:37,799 Speaker 1: to tune into The Bloomberg Law Show every weeknight at 533 00:34:37,840 --> 00:34:41,279 Speaker 1: ten pm Wall Street Time. I'm June Grosso and you're 534 00:34:41,400 --> 00:34:42,600 Speaker 1: listening to Bloomberg