Speaker 1: You're listening to Bloomberg Law with June Grusso from Bloomberg Radio.
Speaker 1: Jurors deliberated for more than four and a half hours
Speaker 1: today in Donald Trump's historic hush money trial without coming
Speaker 1: to a decision on whether the former president falsified his
Speaker 1: company's records to hide a hush money payment to porn
Speaker 1: star Stormy Daniels and influence the twenty sixteen election. Shortly
Speaker 1: after the jurors got the case, Trump repeated his claim
Speaker 1: that the case is rigged.
Speaker 2: By the JACIC conducting those judges. But we'll see, we'll see.
Speaker 1: How we do. Deliberations will resume at nine thirty tomorrow morning,
Speaker 1: when the jurors will hear readbacks of testimony they've requested
Speaker 1: about a Trump Tower meeting in August of twenty fifteen
Speaker 1: that prosecutors say was central to a criminal conspiracy to
Speaker 1: boost Trump's twenty sixteen presidential campaign. Joining me is criminal
Speaker 1: defense attorney dunk and Levin, a former Manhattan prosecutor. Duncan.
Speaker 1: Let's start with the defense case and how the defense
Speaker 1: attorney presented that case. In closing arguments, Todd Bland seemed
Speaker 1: to focus on Michael Cohen almost to the exclusion of
Speaker 1: everything else, calling him the human embodiment of reasonable doubt,
Speaker 1: the greatest liar of all time. What did you think
Speaker 1: of the defense close?
Speaker 3: I thought it was meandering. And they are clearly trying
Speaker 3: to attack the credibility of Michael Cohne, because Michael Cohne
Speaker 3: is the most problematic part of the case for them.
Speaker 3: What Michael Cohne does is take a circumstantial case and
Speaker 3: makes it a direct case. And what I mean by
Speaker 3: that is that and the DA called Michael Cohne late
Speaker 3: in its case to really corroborate all these other pieces
Speaker 3: of evidence. At the core of the case are two
Speaker 3: main things. One is that mister Trump falsified business documents.
Speaker 3: He caused the falsification of business documents with the intent
Speaker 3: to conceal a conspiracy between Michael Cohne, David Pecker, and
Speaker 3: mister Trump to promote his election by unlawful means. That
Speaker 3: unlawful means was hush money payments to Stormy Daniels, Karen McDougall,
Speaker 3: and others. So the DA's office has put in a
Speaker 3: lot of evidence that shows this conspiracy, that shows that
Speaker 3: mister Cohne and mister Trump and the National Inquirer were
Speaker 3: operating together in order to promote the election by unlawful means.
Speaker 3: They put in evidence by David Pecker, who testified that
Speaker 3: this went way beyond catch and kill, that in fact,
Speaker 3: the National Choir was really operating as an arm of
Speaker 3: the Trump campaign, that they were the eyes and ears
Speaker 3: of the campaign, that they were looking for stories to
Speaker 3: go out and catch and kill. There was evidence that
Speaker 3: prior to twenty fifteen, when this all started happening, they
Speaker 3: never worked with a presidential candidate, they'd never done anything
Speaker 3: in coordination with a presidential candidate to catch and kill,
Speaker 3: and that they were really operating as an arm of
Speaker 3: the campaign. And where catch and kill is not illegal
Speaker 3: one to itself, when they start operating in that way
Speaker 3: as an arm of the campaign, it becomes illegal because
Speaker 3: it's promoting an election by unlawful means. These payments to
Speaker 3: women to get their silence. The CIA then called Keith Davidson,
Speaker 3: who was Doormy Daniels attorney, who testified about why this
Speaker 3: was about the election and not about a cover up
Speaker 3: of an affair to try to keep it from millennia.
Speaker 3: This was something that was about the election. Keith Davidson
Speaker 3: testified that these deals were dead. Really he represents Doormy
Speaker 3: Daniels and was trying to get money for her, and
Speaker 3: that this deal was dead. They were trying to kick
Speaker 3: it down the road till after the election, and once
Speaker 3: the Access Hollywood tape came out, which was devastating to
Speaker 3: the campaign. They had testimony from Hope Picks about how
Speaker 3: terrible this was for the campaign. There was this increased
Speaker 3: feverish peace from the Trump campaign to try to pay
Speaker 3: off Stormy Daniels and Karen McDougall, who it came to
Speaker 3: their attention, we're trying to sell their stories because if
Speaker 3: right on that Heels On the Acts of Hollywood tape,
Speaker 3: these two women's stories came out, it would have been
Speaker 3: the nail in the coffin for the Trump campaign, or
Speaker 3: at least they thought so. So. Davidson testified that there
Speaker 3: was this feverish pace to try to get this money
Speaker 3: to Stormy Daniels right after that Access Hollywood tape came
Speaker 3: out because they were trying to keep it from the electorate,
Speaker 3: and Michael Cone called his banker, Gary Farrow, who also
Speaker 3: testified that mister Cone called him with his pass on
Speaker 3: fire to try to get money through this shell company
Speaker 3: called the es Central Consultants, LLC, through to Stormy Daniels.
Speaker 3: So they did a very good job putting together this conspiracy,
Speaker 3: and they don't really need Michael Cone's testimony for that
Speaker 3: at all.
Speaker 1: What about for the falsification of business records.
Speaker 3: They also don't need Michael Cone's testimony really for the
Speaker 3: falsification of the business documents, because on their face they
Speaker 3: have this was exhibit thirty five and thirty six in
Speaker 3: the trial. They have who documents, one of which is
Speaker 3: on First Republic Bank letterhead which has Alan Weisselberg's handwriting
Speaker 3: on it, showing that this payment one hundred and thirty
Speaker 3: thousand dollars to Stormy Daniels was quote unquote grossed up,
Speaker 3: which was doubled for taxes. And what that means is
Speaker 3: that it wasn't legal services to Michael Cohen, as the
Speaker 3: defense says it was, because if it was legal services,
Speaker 3: it wouldn't be grossed up for taxes. It would just
Speaker 3: be a payment. Nobody pays double knowing that the person
Speaker 3: who's receiving the payment has to pay taxes on it.
Speaker 3: You pay somebody and they have to pay taxes on it. Well,
Speaker 3: if it's a reimbursement, you would double it so that
Speaker 3: he would say it's income, and the books and records
Speaker 3: would show what was income, and he would pay taxes
Speaker 3: on it. And he's still wind up with the same
Speaker 3: amount of one hundred and thirty thousand dollars for reimbursement.
Speaker 1: So then where does the prosecution need Michael Cohen, if
Speaker 1: at all?
Speaker 3: So where does Michael Cohes fit into all of this? Well,
Speaker 3: he's a critical witness because all of that is circumstantial
Speaker 3: evidence that puts Donald Trump at the center of it.
Speaker 3: And Michael Cohen basically says on the stand he authorized it,
Speaker 3: he approved it. And that's what turns this case from
Speaker 3: a circumstantial case where there's a lot of evidence of
Speaker 3: other people saying things about, well, how is it possible
Speaker 3: that mister Trump was signing these thirty five thousand dollars checks?
Speaker 3: And that magic number of thirty five thousand dollars comes
Speaker 3: from this grossed up figure of one hundred and thirty
Speaker 3: thousand times two, and there's some other amounts of money
Speaker 3: that are added into that. Divided by twelve for a
Speaker 3: monthly payment, it comes to thirty five thousand. There's no
Speaker 3: evidence of any retainer agreement between Michael Cohne and mister
Speaker 3: Trump or the Trump organization. There's no invoices, and in fact,
Speaker 3: there's some evidence that came in a trial that mister
Speaker 3: Cohn actually emailed mister Weieselberg and said how much money
Speaker 3: am I supposed to be billing for every month? Again,
Speaker 3: which is not something.
Speaker 2: A lawyer would normally say.
Speaker 3: All of this is evidence that does not require Michael
Speaker 3: Cohne's testimony at all, except that Michael Cohne takes it
Speaker 3: from a case that's circumstantial to a case that's very strong,
Speaker 3: because he says, yeah, I was in the room with
Speaker 3: President Trump then when he was in the Oval office,
Speaker 3: and he approved all of this. He approved the repayment scheme.
Speaker 3: But the defense passd you destroy Michael Cohne. It has
Speaker 3: to destroy Michael Cohene, And that's what they tried to
Speaker 3: do in their closing statement. And I think it was
Speaker 3: neandering and they're trying to poke holes in it, and
Speaker 3: that I don't think it was effective in actually getting
Speaker 3: to the heart of the matter, which is whether mister
Speaker 3: Trump knew of this repayment scheme and did it in
Speaker 3: order to cover up this promotion of his election by
Speaker 3: unlawful meets.
Speaker 1: So the defense was just poking holes in the prosecution's case.
Speaker 1: And Michael Cohen, do you think it makes a difference
Speaker 1: that he didn't cover whole picks, He didn't talk about
Speaker 1: some of the important witnesses, He didn't cover what you
Speaker 1: just mentioned that piece of paper with Alan Weiselberg's ublings
Speaker 1: on it. I mean, do you think it matters that
Speaker 1: he didn't do that?
Speaker 3: It matters tremendously because then the prosecution gets up and
Speaker 3: gave a four and a half hour closing that pointed
Speaker 3: out to the jury all of the things that the
Speaker 3: defense didn't actually address. You're right, he did not address
Speaker 3: whole picks. He did not address the tape recorded phone
Speaker 3: call that mister Cohne made with mister Trump was then
Speaker 3: President Trump in the Oval office. He didn't address the
Speaker 3: fact that the NDA used secret names, that the checks
Speaker 3: that were sent for thirty five thousand dollars were sent
Speaker 3: from mister Trump's personal accounts. The checks were physically sent
Speaker 3: not to the White House, but secretly to Keith Schiller,
Speaker 3: who was his body man, who was not in the
Speaker 3: White House, was sent to his personal residence of off
Speaker 3: site in Washington, DC and given to the then president
Speaker 3: to sign in the Oval office. He didn't address a
Speaker 3: lot of the context behind the call. So, for example,
Speaker 3: there's a call that was made that the defense made
Speaker 3: a big deal out of, and he did on closing
Speaker 3: the well on October twenty fourth, twenty sixteen, which is
Speaker 3: a phone call from mister Cohne, and mister Cone testified
Speaker 3: to this on direct examination. There's a phone call from
Speaker 3: mister Cone to Keith Schiller, who's mister Trump's body man,
Speaker 3: and mister Cone said, yeah, mister Schiller was with mister Trump,
Speaker 3: and that was a phone call that I made about
Speaker 3: Stormy Daniel Well. The defense and cross examination brought out
Speaker 3: a number of text messages that they were able to
Speaker 3: find immediately preceding that phone call, in which mister Cone
Speaker 3: said to mister Schiller, there's some fourteen year old girl
Speaker 3: who's harassing me, and mister Shiller writes back, call me. Well.
Speaker 3: The defense made a huge deal about that on cross
Speaker 3: examination in the closing argument as well, saying that was
Speaker 3: a lie, that was perjury. You called him back because
Speaker 3: you were talking about that fourteen year old girl. You
Speaker 3: were not talking about Stormy Daniels and you are lying,
Speaker 3: and they can do that, and he makes a big
Speaker 3: stink about it on his cross examination, but the prosecution
Speaker 3: stood up and did what it did on redirect examination
Speaker 3: by saying, you're not looking at the context of all
Speaker 3: of this. You're not focusing on the fact that immediately
Speaker 3: following that phone call on October twenty fourth, twenty sixteen,
Speaker 3: there are thirty frantic messages over the messaging app called
Speaker 3: Signal between you and mister Pecker at the National Inquirer
Speaker 3: talking about Stormy Daniels. And it does not address the
Speaker 3: fact that on the next day, on October twenty fifth,
Speaker 3: twenty sixteen, there is a text message from Dylan Howard
Speaker 3: over at the National in Choir to you to mister
Speaker 3: Cohane that says, we better get on the same page
Speaker 3: about this or we're going to look really bad. It
Speaker 3: doesn't address the fact that on the following day there
Speaker 3: was the wire payment to Stormy Daniels and the day
Speaker 3: after that the NBA was signed. So there is context
Speaker 3: about this, and so the defense is doing what it
Speaker 3: needs to do, what it has to do, but ultimately
Speaker 3: is not particularly effective in trying to cherry pick out
Speaker 3: all of the little pieces of the case that sound
Speaker 3: bad and try to confuse the jury. That is what
Speaker 3: the defense needs to do, and you sort of can
Speaker 3: use the jury, whereas the prosecution needs to tell a
Speaker 3: narrative that starts at the beginning and goes to the
Speaker 3: end and tells a story. And so that is really
Speaker 3: the disconnect between what the defense is trying to do
Speaker 3: and what the prosecution did in this closure.
Speaker 1: Coming up next on the Bloomberg Lanchew, I'll continue this
Speaker 1: conversation with Duncan Levin and we'll talk about why the
Speaker 1: judge got angry during the closing arguments yesterday, as well
Speaker 1: as just what the prosecution has to prove for a conviction. Here,
Speaker 1: I'm June Grosso, and you're listening to Bloomberg. The Manhattan
Speaker 1: jury weighing Donald Trump's hush money case ended its first
Speaker 1: day of deliberations after asking to review testimony about a
Speaker 1: Trump Tower meeting that prosecutors say was central to a
Speaker 1: criminal conspiracy to boost his twenty sixteen presidential campaign. This afternoon,
Speaker 1: the jury sent the judge a note asking for testimony
Speaker 1: about an August twenty fifteen meeting at Trump Tower. Attended
Speaker 1: by Trump, David Pecker, the publisher of The National Inquirer,
Speaker 1: and Michael Cohen, Trump's former attorney and fixer turned star.
Speaker 1: Prosecution witness. Pecker had testified that he agreed then to
Speaker 1: help Trump's campaign by praising him in print, punishing his rivals,
Speaker 1: and buying and burying accounts of his extramarital affairs. The
Speaker 1: jury also asked to hear testimony about how Pecker's company
Speaker 1: paid former Playboy playmate Karen McDougall one hundred and fifty
Speaker 1: thousand dollars in twenty sixteen to buy and bury her
Speaker 1: account of an affair with Trump a decade earlier. It's
Speaker 1: hard to know exactly what the jurors are looking for,
Speaker 1: but the request may suggest they are working through the
Speaker 1: chronology laid out by the prosecutors in their case. Pecker
Speaker 1: was the prosecution's first witness, and he served as a
Speaker 1: sort of narrator for prosecutors in detailing the alleged scheme.
Speaker 1: In a second note, the jurors asked to hear Judge
Speaker 1: Mershon's instructions again, but before jurors could hear the testimony
Speaker 1: or the judge's instructions again, Mershawn dismissed the panel for
Speaker 1: the day, saying deliberate rations will resume tomorrow morning at
Speaker 1: nine point thirty. I've been talking to criminal defense attorney
Speaker 1: Duncan Levin, a former Manhattan prosecutor. One thing during closing
Speaker 1: arguments that really angered the judge was when the defense
Speaker 1: attorney Todd Blanche mentioned punishment in his closing arguments, said,
Speaker 1: you don't want to send the former president or the
Speaker 1: presidency refers to him to jail. Everyone knows who's tried
Speaker 1: a case, so who's been in court that that's not allowed.
Speaker 1: So Blanche must have known it. Do you think it
Speaker 1: backfired on him because the instruction, the curative instruction, actually
Speaker 1: told the jury, you know, even if he's found guilty,
Speaker 1: Trump doesn't necessarily have to get prison time.
Speaker 3: It's something that is a basic ground rule for lawyers
Speaker 3: to know not to mention certain things. They're not to
Speaker 3: argue impermissible things to the jury. This is plainly impermissible.
Speaker 3: Prosecution or defense knows that you can't do that, it's impermissible.
Speaker 3: The judge was right to fly off the handle with it.
Speaker 3: And you know, it's one of these things that is
Speaker 3: hard to reconcile as a fiction of what the jury
Speaker 3: knows or doesn't know. I mean, we're to presume that
Speaker 3: this jury is not reading any newspapers, is not aware
Speaker 3: of the coverage of it, is not thinking about the
Speaker 3: ramifications to them of a guilty verdict, or whether they're
Speaker 3: doing something unprecedented in convicting and or some point of punishment,
Speaker 3: whether it's jail or not for the former president of
Speaker 3: the United States. These are things that you know, are
Speaker 3: legal fictions. And then there's this other fiction of a
Speaker 3: curative instruction or striking testimony in front of the jury.
Speaker 3: It's sort of hard to stuff the genie back into
Speaker 3: the bottle. You know, they hear it, they get a
Speaker 3: curative instruction, but then they're thinking, because they're human, they're like, oh, well,
Speaker 3: we may be sending the former president to jail. So
Speaker 3: I think Blanche was absolutely out of bounds by mentioning it.
Speaker 3: He clearly knew he shouldn't. The judge was right to
Speaker 3: fly off the handle with him. And as to what
Speaker 3: damage it did or didn't do, it's going to be
Speaker 3: devilutely impossible to help.
Speaker 1: And then on the other side, the prosecutors said, there's
Speaker 1: no special standard for Donald Trump. Donald Trump can't shoot
Speaker 1: someone on Fifth Avenue and get away with it, which
Speaker 1: caused an objection which was sustained. But he got it in.
Speaker 1: It's the same thing, right, you can't unring the bell, right.
Speaker 3: I mean, this is a famous line of Donald Trump
Speaker 3: that he could shoot somebody in the middle of Fifth
Speaker 3: Avenue and get away with it. And it's a statement
Speaker 3: that is not an evidence. There are rules of evidence.
Speaker 3: Prosecution is held to a higher standard. They shouldn't have
Speaker 3: mentioned it. This is the objection was sustained. It's a
Speaker 3: minor point, I suppose, because it's not well, there's a
Speaker 3: distinction to be made between argument that is impermissible because
Speaker 3: it wrongly has the jury doing something that is beyond
Speaker 3: the scope of what it's supposed to do, like considering punishment.
Speaker 3: Their job is to consider the facts of it, and
Speaker 3: mentioning something that where there are no facts and evidence.
Speaker 3: It's sort of, in a way, a more minor transgression.
Speaker 3: But that was an objection that was sustained, and you're right,
Speaker 3: so the jury hears it.
Speaker 2: What are they going to do with it?
Speaker 3: You know? For those who know the reference, they know
Speaker 3: the reference. For those that don't. They don't, but it's
Speaker 3: really more a statement of what is an evidence and
Speaker 3: what is not in evidence.
Speaker 1: They probably have to be living in a cave for
Speaker 1: the last eight years if they didn't know that.
Speaker 3: That's right, And that's part of the fiction of this case.
Speaker 3: There's so much, you know, they're supposed to have evidence
Speaker 3: in front of them during the trial that they can consider,
Speaker 3: and they're not supposed to consider anything outside of what
Speaker 3: happened during the last few weeks of this trial. And
Speaker 3: so that's why the DA introduced evidence, for example, from
Speaker 3: mister Trump's books showing that he was a penny pincher
Speaker 3: and that he negotiated everything down to the paper clip,
Speaker 3: because that gets to their point that he wouldn't just
Speaker 3: be signing thirty five thousand dollars checks for Michael Cohene
Speaker 3: without knowing what that was for. But the jurors may
Speaker 3: also be away or just from reading the newspapers that
Speaker 3: their Trump is someone who famously doesn't pay his lawyers.
Speaker 3: That didn't come into evidence, but it might be something
Speaker 3: they know in the back of their mind that he's
Speaker 3: somebody who has, you know, never paid his lawyers or
Speaker 3: paid vendors, which has been widely reported on, and so
Speaker 3: that is something that they may be using in the
Speaker 3: back of their head, but they're not supposed to bring
Speaker 3: it into the deliberation room because it's not evidence in
Speaker 3: the trial that wasn't presented.
Speaker 2: They didn't call.
Speaker 3: Lawyers who got diffed on their legal invoices. So you know,
Speaker 3: I think that there's this fiction about what a jury
Speaker 3: knows and doesn't know, but they're really only supposed to
Speaker 3: consider evidence that came in that was properly admitted into evidence,
Speaker 3: and nothing else.
Speaker 1: Do you think the prosecution did enough in marshaling the
Speaker 1: evidence and presenting its case in closing arguments?
Speaker 3: Yeah, undoubtedly, Yes, every element of the crime was put in.
Speaker 3: I mean there's ample evidence if you credit Michael Cone,
Speaker 3: for sure. Even without crediting Michael Cone, I think there's
Speaker 3: ample evidence that mister Trump was aware of and approved
Speaker 3: the repayment scheme to Michael Cone, that was a lie
Speaker 3: on the books and records, that this was for legal
Speaker 3: services to Michael Cone, that it was a cover up
Speaker 3: of payments to Storm mc daniels and Karen McDougall and others,
Speaker 3: That there was a conspiracy between David Pecker and the
Speaker 3: National inquirer and Michael Cone to promote mister Trump's election
Speaker 3: by unlawful means, now lawful means for the hush money
Speaker 3: payments that violated federal campaign finance laws. Think that everything
Speaker 3: is there. The only reason he will be acquitted or
Speaker 3: a hung jury is if there's a juror too for
Speaker 3: other reasons other than the evidence, decides not to convict them.
Speaker 3: I think the evidence is beyond a reasonable doubt that
Speaker 3: he is guilty of the crimes.
Speaker 1: And so will you explain what the jurors have to
Speaker 1: find in order to convict Trump the elements of the crime.
Speaker 3: Sure, In the first instance, they have to find that
Speaker 3: mister Trump one caused the filing of false business records
Speaker 3: and two that he did so with the intent to
Speaker 3: conceal another crime. And the other crime is a violation
Speaker 3: of New York state election law and the statute that
Speaker 3: makes it illegal to conspire to promote an election by
Speaker 3: unlawful means. And the judge said that the jury can
Speaker 3: differ on what the unlawful means was. So they all
Speaker 3: have to agree that mister Trump caused the filing of
Speaker 3: false business records. They all have to agree that mister
Speaker 3: Trump did so with the intent to promote his election
Speaker 3: by unlawful means, and that the jurors can disagree with
Speaker 3: what the unlawful means were, but that's it. That's what
Speaker 3: they have to find.
Speaker 1: So is it an advantage to the prosecution that the
Speaker 1: judge instructed the jury that they don't have to be
Speaker 1: unanimous as to the unlawful means and they can each
Speaker 1: decide whether it was state election law, federal election law,
Speaker 1: or the falsification of other business records.
Speaker 3: Well, there's a narrative out there, particularly in more conservative
Speaker 3: media that I have been seeing, where there's been outrage
Speaker 3: that the jurors don't need to be unanimous on what
Speaker 3: the underlying crime is. Just to be more specific, they
Speaker 3: do need to be unanimous on what the underlying crime is,
Speaker 3: which is a conspiracy to promote his election by unlawful means.
Speaker 3: It's another step down about it's a technical question about
Speaker 3: what the unlawful means were. So was it the payment
Speaker 3: to Stormy Daniels, wasn't the payment to Karen McDougal. Was
Speaker 3: it in furtherance of a tax crime? But they do
Speaker 3: need to be unanimous on the bump up crime, which
Speaker 3: is this violation of New York State election law. There
Speaker 3: is certainly an advantage to the prosecution from that jury instruction,
Speaker 3: But there are other jury instructions which really did not
Speaker 3: go the prosecution's way. For example, they were arguing for
Speaker 3: an expansive definition of the word cause that mister Trump
Speaker 3: caused the filing of false business records. The statute doesn't
Speaker 3: lay out what it means to cause somebody to file
Speaker 3: false business records, and the prosecution was arguing that should
Speaker 3: be expansively read to say that it was reasonably foreseeable
Speaker 3: from his actions that the records would be filed, and
Speaker 3: the defense objected to it. And it looks like the
Speaker 3: judge gives the instruction on cause just being the standard
Speaker 3: definition of it, which is to make somebody do something,
Speaker 3: because there's really no evidence that mister Trump picked up
Speaker 3: the phone and said to mister Cohne, oh, you should
Speaker 3: file these false business records. It's more nebulous than that.
Speaker 3: And so there are some through instructions that went to
Speaker 3: prosecution's way, and there are some that went to defense life.
Speaker 1: Is there anything in particular in the prosecution's case, putting
Speaker 1: aside the fact that there may be a juror who
Speaker 1: is a hidden Trump supporter with an agenda. Is there
Speaker 1: anything that might confuse the jury or hang the jury?
Speaker 3: I mean, I think the weakest part of the prosecution's
Speaker 3: case is exactly that, which is whether Trump caused the
Speaker 3: records to be filed. And you know, I think the
Speaker 3: rest of it is extremely strong. There's tons of evidence
Speaker 3: putting mister Trump at the center of it. I think
Speaker 3: they made a case that mister Trump was distracted. He
Speaker 3: was president involved in the internal accounting of the Trump
Speaker 3: organization and doesn't really know how these things are being
Speaker 3: recorded in the books and records and whether they're being
Speaker 3: recorded as legal payments or reimbursements, and he's just not
Speaker 3: paying attention to that kind of thing and did not
Speaker 3: cause this to happen, And that mister Cohne and mister Weifelberg,
Speaker 3: the former CFO, were working together but not with mister Trump,
Speaker 3: to try to distance mister Trump from that as much
Speaker 3: as possible. I mean, that is their best defense.
Speaker 1: On the whole. What do you think about the defense case?
Speaker 3: Look, I think the defense overplayed its hand by arguing that,
Speaker 3: you know, the sexual encounter with Stormy Daniels never happened.
Speaker 3: I think they overplayed their hand by saying that this
Speaker 3: was not a reimbursement in mister Cohne, but was really
Speaker 3: for legitimate legal services. And at times the case they
Speaker 3: were arguing felt much more for public consumption than for,
Speaker 3: you know, the narrow purpose of trying to get their client.
Speaker 1: Equitted, maybe for public consumption or for their clients' consumption.
Speaker 3: I think that's exactly right.
Speaker 1: Is there a conflict in the fact that they're saying
Speaker 1: that these were payments for a legal retainer, yet they're
Speaker 1: saying that on that document with the scribbling by Alan Weisselberg,
Speaker 1: they're saying that Coed, you know, stole tens of thousands
Speaker 1: of dollars from Trump. Is there any sort of disconnect there?
Speaker 3: I don't think so. I mean, everybody knows Michael Cohene
Speaker 3: is a liar, and the fact that he stole money
Speaker 3: doesn't really change anything. It's a distraction from the key
Speaker 3: issues sul case.
Speaker 1: Thanks so much for being on the show. That's criminal
Speaker 1: defense attorney Duncan Levin. Coming up next on the Bloomberg
Speaker 1: Lawn Show, we're going to be talking about the settlement
Speaker 1: that many say could change the face of US college Sports.
Speaker 1: I'm June Grosso and you're listening to Bloomberg. The NCAA,
Speaker 1: in the nation's five biggest conference, is announced they've agreed
Speaker 1: to pay nearly two point eight billion dollars to settle
Speaker 1: a host of anti trust claims. It's a monumental decision
Speaker 1: that sets the stage for a groundbreaking revenue sharing model
Speaker 1: that could start steering millions of dollars directly to athletes
Speaker 1: as soon as the twenty twenty five fall semester. Joining
Speaker 1: me is Martiny Dell, co chair of the sports law
Speaker 1: practice at Golston and Stores. They've been fighting this for years.
Speaker 1: Why settle now?
Speaker 2: So that's a great question. The answer seems to be
Speaker 2: that you have a confluence of events. You have three
Speaker 2: antitrust lawsuits that the NCAA seems to be desirous of
Speaker 2: cutting its attorneys' fees on. They have a legislative program
Speaker 2: where they're lobbying Congress at this point, and the time
Speaker 2: to lobby this session of Congress is going to expire
Speaker 2: pretty quickly. And third is they got the Power five
Speaker 2: on board at this point. So taking advantage of all
Speaker 2: those things, I think means that the NCAA wanted to
Speaker 2: resolve these issues, which it seems at least that the
Speaker 2: NCAA wasn't willing to take the risk of going to court.
Speaker 1: On tell us about the agreement.
Speaker 2: Generally sure, So again, the agreement is subject to Judge
Speaker 2: Wilkins's approval and that has not yet occurred. What it
Speaker 2: will cover has a retrospective and prospective element to it.
Speaker 2: The retrospective element is to pay student athletes, principally men's basketball,
Speaker 2: women's basketball, and football athletes, two point seven to two
Speaker 2: point eight billion dollars over ten years, and that will
Speaker 2: compensate them sensibly for the moneies they lost in revenue
Speaker 2: sharing and nil dollars from twenty sixteen to forward. That's
Speaker 2: element one. Second element is the prospective that the school
Speaker 2: subject to this agreement have agreed to revenue sharing for
Speaker 2: media revenues up to what comes out to about twenty
Speaker 2: million dollars a year in TOTO with their student athletes.
Speaker 2: Those are the principal elements. It covers current and past
Speaker 2: athletes and what the allocation format. And there are lots
Speaker 2: of unknowns in there, but those are the principal elements. Yes,
Speaker 2: I understand them.
Speaker 1: Let's start with the back payments, which athletes will be
Speaker 1: paid and how much?
Speaker 2: So what seems to be the case is it will
Speaker 2: cover men's basketball, women's basketball, and football, which is obviously
Speaker 2: a male sport. That will be the two point seven
Speaker 2: to two point eight billion, which it seems will come
Speaker 2: forty one percent from the NCAA, thirty four percent from
Speaker 2: the Power five and the Football Bowl Championship, and the
Speaker 2: balance from twenty seven smaller conferences, which makes it about
Speaker 2: I guess twenty five percent.
Speaker 1: Let's take football. Does every football player you know within
Speaker 1: the timeframe get money?
Speaker 2: So that's not exactly worked out. It seems to cover
Speaker 2: all the players going back to twenty sixteen to the
Speaker 2: loss of dollars. How they allocate that as something else.
Speaker 2: Somebody who sat on the bench from twenty sixteen to
Speaker 2: twenty eighteen ostensibly wouldn't be entitled to quite the same
Speaker 2: share as the starting quarterback or the star center for
Speaker 2: teams should get more than somebody who wrote the bench
Speaker 2: on the men's or women's basketball team. It would cover
Speaker 2: about ten thousand student athletes.
Speaker 1: As far as the upcoming payments, does each school decide
Speaker 1: who gets what?
Speaker 2: So the schools that buy into the program have agreed
Speaker 2: to contribute a percentage of their media revenues going forward,
Speaker 2: and it comes out to about the numbers I've seen,
Speaker 2: about twenty two percent of the media revenues of an
Speaker 2: average Power five team. Power five are essentially five conferences,
Speaker 2: the ACC, the Big Ten, the Big twelve, the SEC,
Speaker 2: and whatever is left of the PAC twelve, which is
Speaker 2: now down to two teams, so I guess it's the
Speaker 2: Pack two. There's a formula to be worked out. The
Speaker 2: allocation is supposed to be worked out by an expert
Speaker 2: that has not yet occurred.
Speaker 1: Will each school do it the same way or will
Speaker 1: schools do it different ways?
Speaker 2: So that's not entirely clear. I mean, there's a lot
Speaker 2: of lack of clarity, if you will. In the agreement.
Speaker 2: It provides strong goalposts, visible ones that people could see,
Speaker 2: such as it's approximately twenty two percent of a Power
Speaker 2: five's media revenues. So if you're an IVY League team,
Speaker 2: you're going to have to contribute both on the retrospective
Speaker 2: side your share of twenty five five percent and on
Speaker 2: the prospective side about twenty two percent of your media
Speaker 2: revenues on an annual basis.
Speaker 1: So let's talk about Title nine how does Title nine
Speaker 1: work in here?
Speaker 2: So it works in a number of ways which don't
Speaker 2: seem to have been thought through very clearly. So because
Speaker 2: Title nine mandates more or less gender equality, there's a
Speaker 2: real question of how the funds will be allocated. You know,
Speaker 2: right now you have women's basketball being covered, But will
Speaker 2: it be covered to the same extent, for instance, as
Speaker 2: men's basketball retrospectively and prospectively not clear because we don't
Speaker 2: have those details yet. What will other women's teams get
Speaker 2: in terms of dollars both nil and prospectively revenue sharing?
Speaker 2: Title nine will have to factor in here because it's
Speaker 2: the law, but it's not at all clear how Title
Speaker 2: nine will factor it.
Speaker 1: Suppose there's a school that has men's basketball, men's football,
Speaker 1: women's basketball, but also has, let's say, a great rowing
Speaker 1: team or something. Can they say, Okay, we're giving men's
Speaker 1: basketball and football and women's basketball this much, and we're
Speaker 1: going to give the rowing team this much.
Speaker 2: So it seems that the schools can allocate the dollars
Speaker 2: to any sport they want. The question is will they
Speaker 2: allocate dollars to non revenue sports such as rowing. It's
Speaker 2: curious that one of the lawsuits that's being settled. He
Speaker 2: or one of the anti trust suits is House lawsuit.
Speaker 2: House was a swimmer that is not a revenue sport.
Speaker 2: He should be entitled to get a sum amount for
Speaker 2: nil rights for gone for the period twenty sixteen until
Speaker 2: the NCAAA changed their rules on July one, twenty twenty one.
Speaker 2: But it's not clear again how much non revenue sports
Speaker 2: athletes will get from this.
Speaker 1: Does this mean the NCAA's antitrust problems are over.
Speaker 2: Hardly No, it's the short answer for a couple of reasons.
Speaker 2: First off, there is a fourth antitrust lawsuit hanging out there,
Speaker 2: the Fortnate suit, which has been in the federal District
Speaker 2: court in Colorado, and the judge there refused to consolidate
Speaker 2: that lawsuit into the House suit at this point without prejudice,
Speaker 2: so it could be revisited. But that lawsuit is going
Speaker 2: forward and that deals with our athletes from the revenue
Speaker 2: sports entitled to a share of TV rights and revenues
Speaker 2: that go forward. Second antitrust issue that's going to come up, Well,
Speaker 2: if the schools are camping, the amount they're going to
Speaker 2: share in terms of revenue at twenty million dollars a year,
Speaker 2: we're about twenty two percent. Well, that may create another
Speaker 2: antitrust violation. Why should there be a cap on the
Speaker 2: amount that schools are willing to share. Why wouldn't the
Speaker 2: athletes in their free market be able to obtain a
Speaker 2: greater percentage than that amount. So this settles three lawsuits
Speaker 2: that are in existence. There's one in existence that's not settled,
Speaker 2: and there may be others down the road. That leads
Speaker 2: to the NCAA's appeal to Congress to give it an
Speaker 2: antitrust exemption, and appeal which so far is pulling on
Speaker 2: deaf ears.
Speaker 1: Is baseball the only one that has anti trust exemption?
Speaker 2: Yes?
Speaker 1: And people question that as well.
Speaker 2: People question that, but the Supreme Court has made clear
Speaker 2: in the Kurt Flood case in nineteen seventy two that
Speaker 2: it will not step into this breach here. The baseball
Speaker 2: exemption has been in place now for one hundred and
Speaker 2: one years. If the baseball exemption is going to change,
Speaker 2: Supreme Court has made it clear it should come from Congress,
Speaker 2: not from the courts.
Speaker 1: What about name, image, and likeness rights? Does that fit
Speaker 1: in with this? Is it separate?
Speaker 3: So?
Speaker 2: Yes? And yes? How's that for an under answer. So
Speaker 2: what this settlement, if proved, does is it recompenses athletes
Speaker 2: for lost NIL licensing for the period twenty sixteen through
Speaker 2: until July one, twenty twenty one, when there arose a
Speaker 2: free market for NIL licensing rights. So it shouldn't be
Speaker 2: a problem. But what this does on the NIL front
Speaker 2: is that the agreement would permit colleges and universities to
Speaker 2: work directly with student athletes on licensing of their NIL rights,
Speaker 2: something which is currently forbidden under NCAA rules. So it
Speaker 2: would create another c change in NIL rights. Will you
Speaker 2: have the collectives which currently exist? Will you have colleges
Speaker 2: and universities licensing rights directly from their student athletes?
Speaker 1: Dartmouth players recently unionized. Does that cause any conflict with this?
Speaker 2: Probably not, but that's a great point. So this settlement
Speaker 2: does not directly address the issue of whether a student
Speaker 2: athlete is employee or not. That said, it becomes increasingly
Speaker 2: difficult for the NCAA and its member schools to make
Speaker 2: the argument that student athletes are not employees when they're
Speaker 2: getting paid a percentage of revenues for their performance. When
Speaker 2: schools will be licensing NIL rights directly from them, as
Speaker 2: they would from employees that exists there so this will help.
Speaker 2: It seems to me cement the article that student athletes
Speaker 2: at the schools that buy into this will be treated
Speaker 2: as employees. That has a further consequence, which I want
Speaker 2: to go back to the anti trust point. If the
Speaker 2: students are able to be designated as employees and unionized
Speaker 2: so they're covered, for instance, by the National Labor Relations Act,
Speaker 2: there will be no more anti trust issue because the
Speaker 2: National Labor Relations Act takes precedents their rights to collective
Speaker 2: bargain with respect to revenues, and the LIGHT takes precedents
Speaker 2: over the antitrust laws.
Speaker 1: So I confess I don't know all that much about
Speaker 1: college sports, but it seems like there are so many unknowns.
Speaker 1: Why is this being hailed as such a sea change
Speaker 1: in college sports? Do you think it's a sea change?
Speaker 2: Yes, I do, because it's the first time that colleges
Speaker 2: and universities and therefore the NCAA have gotten into the business,
Speaker 2: if you will, of paying athletes directly. That has always
Speaker 2: been a real negative for the NCAA, and its rules
Speaker 2: and regulations to date have prescribed colleges and universities paying
Speaker 2: athletes directly for services other than and scholarship at grant
Speaker 2: and aids. Now that sort of goes by the wayside.
Speaker 2: That's the one real strong takeaway from this entire model.
Speaker 2: It will change the model for the NCAA to do business,
Speaker 2: for these colleges and universities to do business. What it
Speaker 2: is in my view, likely to engender is that you
Speaker 2: will have now a Power five grouping, which may be
Speaker 2: the equivalent of a new minor league for professional sports.
Speaker 2: And it gives all the other schools an opportunity to
Speaker 2: reassess what their mission is. Is it going to be education,
Speaker 2: Is it going to be athletics. If it's education, how
Speaker 2: are they going to change around what they're doing with
Speaker 2: athletics so that they don't have to spend tons of money?
Speaker 2: You know, one of the things I, in my own
Speaker 2: weird way, Jo and I laugh at is the Dartmouth
Speaker 2: basketball players have sought unionization, as you mentioned, yet Dartmouth
Speaker 2: has lost three and a half to five million dollars
Speaker 2: over the last five years on basketball. That's not a
Speaker 2: sustainable model. How can they change that to focus more
Speaker 2: on the Dartmouth educational mission rather than the athletic mission.
Speaker 2: Can't be with the athletes continuing to put in sixty
Speaker 2: to seventy hours a week on athletics, but that needs
Speaker 2: to be thought through. But I think this gives schools
Speaker 2: such as Dartmouth, such as Northwestern, such as Vanderbilt, which
Speaker 2: is the only private school in the SEC, a real
Speaker 2: opportunity to reassess what their mission is.
Speaker 1: Thanks so much, Marty. That's Martini Delle of Gulston and Stores.
Speaker 1: And that's it for this edition of the Bloomberg Law Podcast.
Speaker 1: Remember you've can always get the latest legal news by
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Speaker 1: and at Bloomberg dot com, slash podcast, slash Law. I'm
Speaker 1: June Grosso and this is Bloomberg a