Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio.
Speaker 2: The crypto industry is like the wild wild West. To
Speaker 2: SEC chair Gary Gensler.
Speaker 3: The wild West of the crypto markets rife with non compliance,
Speaker 3: where investors have put hard earned assets at risk, and
Speaker 3: highly speculative asset class such growth and rapid change also
Speaker 3: means more possibility for wrongdoing. Is the cop on the beat?
Speaker 3: We must be able to meet the match of bad actors.
Speaker 2: Gensler told lawmakers five months ago that the agency had
Speaker 2: to expand to protect investors against a crypto industry rife
Speaker 2: with non compliance. So what has the sec accomplished in
Speaker 2: its six years of trying to regulate crypto? Joining me
Speaker 2: to answer that question is securities law expert James Park,
Speaker 2: a professor at UCI Law School. What has the sec
Speaker 2: accomplished so far? And it's battle over crypto.
Speaker 4: It's been a long process, and I think the SEC
Speaker 4: has learned a lot over this period and it has
Speaker 4: developed its positions gradually over time. One criticism I think
Speaker 4: of the SEC is that its positions may not have
Speaker 4: been entirely consistent. But I think it's clear now that
Speaker 4: the SEC views many crypto assets as being securities and
Speaker 4: believes that it can regulate a substantial number of not
Speaker 4: only crypto assets, but also exchanges exchanges where these crypto
Speaker 4: assets have been trading, and has disagreed with some of
Speaker 4: the determinations by these exchanges that the crypto assets trading
Speaker 4: on their marketplaces are not securities. So we have an
Speaker 4: SEC that believes that a significant number of crypto assets
Speaker 4: are securities. We have some industry members who believe the
Speaker 4: SEC's position may be too broad, and there's also a
Speaker 4: criticism that the SEC has not done enough to provide
Speaker 4: clarity to the industry. I think that's another major theme
Speaker 4: that we've seen over the last four or five years.
Speaker 2: What federal agencies are sort of jocking to play a
Speaker 2: role in policing crypto In addition.
Speaker 4: To the SEC, the other major candidate is the CFTC.
Speaker 4: If crypto assets are primarily commodities, and that's typically under
Speaker 4: the jurisdiction of the CFTC. We also have broader issues
Speaker 4: relating to financial regulation, such as money laundering, which would
Speaker 4: be the province of various federal banking regulators. So there
Speaker 4: are a number of different federal agencies that could regulate
Speaker 4: crypto But I think the SDC has been in the
Speaker 4: lead in certain respects and is asserting that many of
Speaker 4: these crypto acsets are securities and that these exchanges are
Speaker 4: under its jurisdiction.
Speaker 2: The SEC has filed about fifty five enforcement lawsuits over
Speaker 2: cryptocurrencies since Gary Gensler took over. That's according to data
Speaker 2: from Cornerstone Research. How has it fared in those cases?
Speaker 4: Generally generally fared fairly well. It's one of the vast
Speaker 4: majority of the cases. But that may also reflect that
Speaker 4: the SEC is picking cases that are favorable to its position.
Speaker 4: It may be picking cases involving egregious facts where there
Speaker 4: is a clear fraud and in cases like that, judges
Speaker 4: tend to be sympathetic to the SEC's position. As it
Speaker 4: gets to bringing cases against entities that are not frauds,
Speaker 4: I think that its task is a little bit more difficult,
Speaker 4: and I think it's getting to that point in a
Speaker 4: number of cases where you don't have clear evidence of fraud,
Speaker 4: and so there's going to be questions about whether its
Speaker 4: position is valid or not.
Speaker 2: Is the SEC embarking on a specific strategy when we
Speaker 2: see that it is suing coinbase and two other platforms.
Speaker 2: Is there a strategy involved here, Yes, I.
Speaker 4: Think the SEC is trying to bring big impact cases
Speaker 4: and exchanges are key centers of activity. They're critical to
Speaker 4: the development of crypto assets because you need a marketplace
Speaker 4: where these assets are traded frequently in order to have
Speaker 4: confidence in the integrity of their prices. So exchanges are
Speaker 4: a very important part of the infrastructure. If you want
Speaker 4: crypto assets to become established as a valid asset class,
Speaker 4: that would bring more investors in. And so the SEC
Speaker 4: is trying to assert its domain over these exchanges, and
Speaker 4: for good reasons. You know. In the background, of course,
Speaker 4: are the scandals at FTX and buyinand those scandals have
Speaker 4: given reason for the SEC to come in and regulate
Speaker 4: exchanges and has taught the SEC a number of lessons
Speaker 4: with respect of the problems that can come up in
Speaker 4: various crypto asset exchanges.
Speaker 2: Do you think that the collapse of FTX and the
Speaker 2: criminal charges and finance do they sort of support Genstler's
Speaker 2: statement that it's the wild wild West.
Speaker 4: They support I think the case for regulation. They support
Speaker 4: the need for regulation. Not all of these changes are
Speaker 4: the same, and so you know, I could see coinbase
Speaker 4: making the arguments that we're not the same as FTX
Speaker 4: and binus. We are making good faith efforts to comply.
Speaker 4: We're a public corporation, you know, we sold securities pursuing
Speaker 4: to a registration statement approved by the SEC that described
Speaker 4: very frankly what our business is, and so we're different.
Speaker 4: We're different, and we are making substantial efforts to comply
Speaker 4: and to prevent market manipulation. The SEC, to my understanding,
Speaker 4: has not found evidence of market manipulation on Coinbase at
Speaker 4: this time, at least it's not alleged in their complaints,
Speaker 4: and so the key for defendants like Coinbase is to
Speaker 4: establish that they are different from FTX and buy it.
Speaker 4: On the other hand, I think the SEC can make
Speaker 4: the case that there are certain structural issues that we
Speaker 4: saw in FTX and binance that lead us to be
Speaker 4: more wary of exchanges, even those like Coinbase that we
Speaker 4: had approved a registration statement for. So I think that's
Speaker 4: one of the issues that will continue to see being
Speaker 4: litigated and developed over the next year.
Speaker 2: Everyone in crypto is watching that case against Coinbase in particular.
Speaker 2: What's the SEC's case there.
Speaker 4: They are arguing that Coinbase is a securities exchange Under
Speaker 4: the Securities Exchange Act of nineteen thirty four, the SEC
Speaker 4: has the power to regulate exchanges, and a securities exchange
Speaker 4: must register with the Securities and Exchange Commissions. That's the
Speaker 4: key issue here, and the question as to whether or
Speaker 4: not something that the securities exchange is going to mainly
Speaker 4: boil down to whether there are securities trading on coinbase wan.
Speaker 4: Coinbase's defense is that we did rigorous evaluation and assessment
Speaker 4: of the crypto assets that we allow to be traded
Speaker 4: on our exchange, and we concluded that none of those
Speaker 4: crypto assets are securities. Therefore, we do not have to
Speaker 4: register with the SEC as a securities exchange. The SEC
Speaker 4: has taken the position in its complaint that there are
Speaker 4: at least ten or so crypto assets trading on coinbase
Speaker 4: that are securities under the HOWI test. Therefore, this is
Speaker 4: an exchange that must register with US, and that you're
Speaker 4: violating the securities laws if you continue to operate without registration.
Speaker 2: Now, Coinbase is going to ask a federal judge this
Speaker 2: month to dismiss the SEC's lawsuit. Do you think that
Speaker 2: there's a chance that a judge would do that, or
Speaker 2: might a judge weight.
Speaker 4: There's always a chance, but I think it is unlikely
Speaker 4: that a judge will grant the motion to dismiss that
Speaker 4: this stage given the complexity of the issues involved. One
Speaker 4: of the questions is whether or not the crypto assets
Speaker 4: identified by the sec are actually securities, and that typically
Speaker 4: is going to require a case by case determination evaluating
Speaker 4: each of these crypto assets based upon the HOWI test,
Speaker 4: and some of that work may require discovery and may
Speaker 4: require looking close lead into these crypto assets and evaluating
Speaker 4: the evidence, which is typically not something that a district
Speaker 4: court will do on a motion to dismiss. Coinbase has
Speaker 4: advanced a very narrow interpretation of Howie. If they were
Speaker 4: to prevail on that very narrow definition of Howie, then
Speaker 4: perhaps the judge could say that I can conclude without
Speaker 4: further discovery that all of these crypto assets are actually securities,
Speaker 4: and that's a plausible outcome, but I think it's unlikely.
Speaker 4: That's just my opinion that may not necessarily turn out
Speaker 4: to be correct, but this is what courts are for.
Speaker 4: They decide whether or not interpretations of tests are appropriate
Speaker 4: or not. There's also another issue with respect to the
Speaker 4: major questions doctrine and whether or not this may involve
Speaker 4: such a large expansion of the SEC's jurisdiction to run
Speaker 4: a foul of a doctrine that the Supreme Court created
Speaker 4: over the last year or so that prohibits expansive interpretations
Speaker 4: of agency power with respect to that particular issue. I
Speaker 4: think that there is more fact finding that would be
Speaker 4: used on that issue, And there's also a good argument
Speaker 4: the SEC has that that doctrin has not really been
Speaker 4: applied to enforcement action. I think there's another argument that
Speaker 4: the crypto asset market that the SEC is seeking to
Speaker 4: regulate is not substantial enough a part of our economy
Speaker 4: to fall under that particular doctrine. You know, if you
Speaker 4: look at the value of all the crypto assets out there,
Speaker 4: you know, the total values maybe around a trillion dollars
Speaker 4: or so. But remember, the SEC is not asserting it
Speaker 4: can regulate all trillion dollars worth of crypto assets, because
Speaker 4: it's competed that bitcoin is not a security, and bitcoin
Speaker 4: represents the vast majority, the maybe supermajority, of the value
Speaker 4: of crypto that is out there, and so we're talking
Speaker 4: about a relatively small amount of value that the SEC
Speaker 4: is trying to start its jurisdiction over and so it
Speaker 4: may not fall under the major questions doctrine.
Speaker 2: Coming up next is the Coinbase case likely to reach
Speaker 2: the Supreme Court. I'm Drew and Grosso and you're listening
Speaker 2: to Bloomberg. I've been talking to Professor James Park of
Speaker 2: UCLA Law School about the SEC's fight to regulate crypto. Jim,
Speaker 2: the SEC's lawsuit against Coinbase has a long way to go.
Speaker 2: But do you think it's a case that you could
Speaker 2: see ending up at the Supreme Court.
Speaker 4: Yes, I think it could. You know, Coinbase has the resources,
Speaker 4: they have excellent legal representation, and these cases involved very
Speaker 4: important legal issues that have not gone up to the
Speaker 4: Supreme Court in some time. You know how he was
Speaker 4: decided more than fifty years ago, and there could be
Speaker 4: reason for the Supreme Court to weigh in on the
Speaker 4: definition of a security. I also don't see the SEC
Speaker 4: backing down from its position. It just filed a case
Speaker 4: in November against another exchange cracket on November twentieth, making
Speaker 4: pretty much the same arguments that is made against Coinbase
Speaker 4: and Binance. So it is committed to its position as well,
Speaker 4: and so we could see litigation proceed all the way
Speaker 4: up to the US Supreme Court.
Speaker 2: So you mentioned Finance's problems. It was criminally charged in
Speaker 2: November and admitted to violating laws that require financial companies
Speaker 2: to have anti money laundering controls, and its founder pleaded
Speaker 2: guilty and faces eighteen months in prison. Do those factors
Speaker 2: play into the SEC's case against Finance.
Speaker 4: The SEC did file motion in the District Court making
Speaker 4: note of that conviction and what it does. I think
Speaker 4: it highlights some of the dangers of exchanges and it
Speaker 4: puts Finance in an unfavorable life. I mean that could
Speaker 4: be a background consideration in the district court assessment of
Speaker 4: the case. However, these securities law issues are different. They
Speaker 4: are different than issues relating to money laundering. The issue
Speaker 4: of whether or not the crypto assets are securities are distinct. Also,
Speaker 4: the sec as allegations of market manipulation, which are still
Speaker 4: being litigated as well. I'm having said that it's a
Speaker 4: bit of an uphill battle for a defendant who has
Speaker 4: pleted guilty to criminal charges on one set of regulatory
Speaker 4: issues in terms of litigating another set of issues before
Speaker 4: the district court. And you know, Coinbase can't be extremely
Speaker 4: happy about the fact that Binance is making pretty much
Speaker 4: the same arguments as coinbase, and so that there's a
Speaker 4: possibility that the District Court in DC, which is deciding
Speaker 4: the finance case, could look unfavorably upon finance and securities
Speaker 4: law theories which are the same as coinbases, and so
Speaker 4: there could be a greater risk of a adverse decision
Speaker 4: in the decail court that could in turn have some
Speaker 4: influence on the way the coinbase litigation is happening, which
Speaker 4: is in the Southern District of Now. I do think
Speaker 4: the district court judges will look independently at these cases
Speaker 4: and assess them the arguments for what they are. But
Speaker 4: it is worth noting that Coinbase in Binance are pretty
Speaker 4: much making the same arguments against the SEC in terms
Speaker 4: of the legal arguments.
Speaker 2: How will the decisions in those three cases affect the
Speaker 2: SEC's push to regulate crypto.
Speaker 4: They will have a very significant impact, and I think
Speaker 4: the most immediate impact is that they will give three
Speaker 4: more district court judges the chance to tell us more
Speaker 4: about the howie, can we have a couple of dueling decisions,
Speaker 4: as you know, in the Southern District of New York
Speaker 4: and the Ripple and terraform cases coming to a different conclusions.
Speaker 4: And now we have three more judges who are going
Speaker 4: to have to decide whether or not particular cryptoascids are
Speaker 4: securities and apply to how we test in doing so,
Speaker 4: and so that, you know, gives us the opportunity to
Speaker 4: see which interpretation is more persuasive or looking more persuasive
Speaker 4: to the federal District Court judges. And you know, if
Speaker 4: you see the district court judges overwhelmingly tilting one way
Speaker 4: versus the other, then that can give momentum to one
Speaker 4: side over the other.
Speaker 2: And where does the effort to launch exchange traded funds
Speaker 2: that whole bitcoin, Where does that effort stand?
Speaker 4: Mind is staying. The sec is considering the petition, and
Speaker 4: my sense is that it's fairly likely that it will
Speaker 4: be granted. And if that's the case, then we're going
Speaker 4: to have a bitcoin exchange traded fund. As I was,
Speaker 4: you know, in the airport recently, I saw an advertisement
Speaker 4: for Great Scale and the Gray Scale ETF. So they
Speaker 4: seem fairly confident that this is happening, and they, you know,
Speaker 4: are obviously probably in touch with the SDC. I mean,
Speaker 4: that's why bitcoin has rallied and that's been a bright
Speaker 4: spot in the stew acid industries. We see bitcoin the
Speaker 4: price increased from around twenty five thousand dollars to around
Speaker 4: forty five thousand dollars and the last four months or so,
Speaker 4: with that additional value, that may attract more investors into
Speaker 4: crypto assets. More generally, the fact that there's an ETF
Speaker 4: may increase the legitimacy of cryptoacid as an asset class,
Speaker 4: and that is certainly something that is a positive development
Speaker 4: for the crypto acid industry. On the other hand, remember
Speaker 4: the sec though, has always distinguished Bitcoin from other crypto assets,
Speaker 4: and so the fact that we have a Bitcoin ETF
Speaker 4: does not mean that other crypto assets that are securities
Speaker 4: are going to escape a regulation. That does not mean
Speaker 4: that this crypto assets other than bitcoin have any real
Speaker 4: economic value. And so I think that it is something
Speaker 4: that is a very interesting dynamic that we'll see over
Speaker 4: twenty twenty four what the impact of that is and
Speaker 4: whether or not that's going to spark more interesting crypto assets.
Speaker 2: And by the end of twenty twenty four, do you
Speaker 2: think that there'll be more certainty about which agency regulates
Speaker 2: crypto It's.
Speaker 4: A good question. I don't know if we'll get more certainty.
Speaker 4: To be frank with you, I think the litigation process
Speaker 4: is going to move slowly. And we are coming up
Speaker 4: on an election. There's some time before we get into
Speaker 4: that election season, but administrative agencies may slow down what
Speaker 4: they're doing as we get into the summer and into
Speaker 4: the falls. You know, we don't know who's going to
Speaker 4: win the election. That could also result in changes in policies,
Speaker 4: changes in priorities. So there's a lot of uncertainty over
Speaker 4: the next year or so that makes it difficult to
Speaker 4: predict whether or not one agency is going to sort
Speaker 4: of rise further to the top.
Speaker 2: Jim, thanks so much for helping us understand all these
Speaker 2: crypto lawsuits it's going on. That's Professor James Park of
Speaker 2: UCLA Law School coming up next on the Bloomberg Law Show.
Speaker 2: Lawsuits in the fight against anti Semitism on college campuses.
Speaker 2: This is Bloomberg.
Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio.
Speaker 2: Instead of studying for finals like his classmates, University of
Speaker 2: Pennsylvania student Ayal Jacobe went to Congress on December fifth
Speaker 2: for a press conference on the anti Semitism at the campus.
Speaker 1: Penn's ambivalence fuels the crisis that has shattered my academic
Speaker 1: sanctuary policies meant to safeguard us have become hollow promises,
Speaker 1: and let us be clear, if they failed Jewish students
Speaker 1: today tomorrow, they will fail the rest of us.
Speaker 2: On the same day, Yakobe and another student also sued Penn,
Speaker 2: claiming the school fostered a hostile environment that left them
Speaker 2: feeling unsafe in class or crossing the campus. Their lawsuit
Speaker 2: is one of several filed in recent weeks against universities
Speaker 2: by students citing Title six of a Civil Rights Act
Speaker 2: of nineteen sixty four. Joining me is Bloomberg Legal reporter
Speaker 2: David Voriakis, David, is there any kind of measure of
Speaker 2: just how much anti Semitism Jewish students are facing on
Speaker 2: campuses these days?
Speaker 5: Several Jewish organizations stay that the anti semitism they have
Speaker 5: seen before October seventh and since the October seventh attack
Speaker 5: by HMAS on Israel is unprecedented, and the numbers have
Speaker 5: spiked dramatically in the last couple of months. So by
Speaker 5: various measures, there's different ways to look at it, but
Speaker 5: the number of anti Semitic incidents that Jewish students have
Speaker 5: seen has dramatically increased, and the Anti Defamation League has
Speaker 5: said something like more than half of American Jewish students
Speaker 5: have seen some type of anti Semitic behavior.
Speaker 2: And what about Muslim, Arab and Palestinian students? Is Islamophobia
Speaker 2: prevalent on campuses today?
Speaker 5: They also are facing a significant increase in Islamophobia. And
Speaker 5: there's an organization known as care caai R as the
Speaker 5: Council of American Islamic Relations, and they say that the
Speaker 5: number of Islamophobia incidents has also dramatically increased.
Speaker 2: So tell us about aal Yakobe University of Pennsylvania student
Speaker 2: to suit his university.
Speaker 5: Al Yakhobe is a senior at ten and he had
Speaker 5: started to complain to university administrators before October seventh about
Speaker 5: anti semitism on campus. In particular, in late September, there
Speaker 5: was a writer's conference of Palestinian writers that's been roundly
Speaker 5: criticized as sponsoring anti Semitic speakers, and he sent a
Speaker 5: number of emails and letters, He organized petition drives and
Speaker 5: had very little success with pen administrators, and he was
Speaker 5: quite frustrated after the Hamas attack. He continued to complain
Speaker 5: about a spike and antisemitism on campus, and he said
Speaker 5: that he felt quite unsafe on campus, that he was
Speaker 5: in the Hillel building on campus when there was a
Speaker 5: bomb threat that was not announced, and he felt that
Speaker 5: the university was not enforcing its policies that were already
Speaker 5: on the books to prevent this type of conduct and speech.
Speaker 5: And so that's what led him to go to Congress
Speaker 5: on December fifth for a press conference. And this was
Speaker 5: on the same day that the three university presidents testified
Speaker 5: to Congress, and that testimony went badly for a couple
Speaker 5: of them. But during that press conference on December fifth,
Speaker 5: he spoke about what he called the chilling landscape of
Speaker 5: hatred and hostility at Penn. He said, despite what my
Speaker 5: university says, I do not feel safe. Let me be clear,
Speaker 5: I do not feel safe. He then told me that
Speaker 5: about a week later, he had already gotten hundreds of
Speaker 5: threats because of his outspokenness at that press conference.
Speaker 2: So he filed a lawsuit against Penn, he and another student,
Speaker 2: and that's one of several lawsuits filed in recent weeks
Speaker 2: against universities, and they're citing Title six of the Civil
Speaker 2: Rights Act. Has Title six been used in this context before.
Speaker 5: Title six has been used in different contexts, often by
Speaker 5: African American students, But it's a new development that Jewish
Speaker 5: students have gotten so organized and have really concentrated on
Speaker 5: how they could use this law to abate the spike
Speaker 5: in anti Semitism on campus. Title six is enforced by
Speaker 5: the Office of Civil Rights at the Education Department, and
Speaker 5: so it can either be enforced by the government itself
Speaker 5: through the Education Department's Office of Civil Rights, or in
Speaker 5: what is sort of a novel twist that we wrote about,
Speaker 5: there are a series of private lawsuits that have been
Speaker 5: filed that seek a potentially the same goal, which is
Speaker 5: to force colleges and universities to use the policies that
Speaker 5: are on the books that prevent the sort of harassment
Speaker 5: that Jewish students are now complaining about.
Speaker 2: Well, for the University of Pennsylvania, what kind of policies
Speaker 2: does the university have that the two students are looking
Speaker 2: for them to enforce.
Speaker 5: Well, for instance, there's a code of conduct that seeks
Speaker 5: to prevent harassment and also to prevent a hostile environment
Speaker 5: based on someone's beliefs. So they want the university to
Speaker 5: enforce those codes of conduct, and the remedy that they're seeking,
Speaker 5: for instance, is to ask a judge to order PEN
Speaker 5: to fire faculty and administrators that are responsible for what
Speaker 5: they say is the anti Semitic abuse permeating the school.
Speaker 5: They also want a judge to order PEN to suspend
Speaker 5: or expel students engaged in such conduct. They're also looking
Speaker 5: forward financial damages.
Speaker 2: Are they asking the school to suspend or expel students
Speaker 2: who protest against Israel or in support of the Palestinians.
Speaker 5: No, this is a very interesting area of the law,
Speaker 5: and what they say they're interested in putting it end too,
Speaker 5: is harassment, either physical harassment, physical threats, or verbal statements
Speaker 5: that are perceived as threats. So mere protests themselves are
Speaker 5: not subject to this type of litigation. What they're trying
Speaker 5: to do is prevent the type of speech that is
Speaker 5: seen as harassing or intimidating speech and conduct. And so
Speaker 5: that's a bit of a gray area, obviously, and it's
Speaker 5: open to interpretation. But one of the aspects of this
Speaker 5: type of litigation is a question about just what is
Speaker 5: anti semitism and what constitutes anti Semitic speech, And there's
Speaker 5: an international interpretation of anti semitism that if you deny
Speaker 5: the ability of Israel to exist, or you say that
Speaker 5: Israel should not exist, then that's considered anti semitism. That's actionable.
Speaker 2: And the expression from the River to the Sea is
Speaker 2: very controversial. Some see it as antisemitic, others do not.
Speaker 2: How do the plaintiffs here view it.
Speaker 5: So the lawyers that are assuing believe that that is antisemitic.
Speaker 5: It is open to interpretation whether the Palestinian supporters who
Speaker 5: say that are in fact advocating the elimination of Israel
Speaker 5: or not. And so this is a very difficult area
Speaker 5: that's going to be resolved in the months ahead, as
Speaker 5: dis litigation moves forward, and as the Department of Education's
Speaker 5: Office of Civil Rights negotiates with schools to reach civil
Speaker 5: settlements in their open investigation of schools that they're looking
Speaker 5: at for possible anti semitism or Islamophobia.
Speaker 2: And the big threat is that schools could lose federal funding.
Speaker 2: Does that happen often?
Speaker 5: It's a major threat that the government has because Title
Speaker 5: six of the Civil Rights Act essentially bars discrimination in
Speaker 5: several areas for agencies or programs that receive federal funding. Now,
Speaker 5: the threat is that that funding would be removed because
Speaker 5: of discrimination. In reality, it's very rare for the Education Department,
Speaker 5: for instance, to actually withhold funding, and schools are aware
Speaker 5: that it's a very bad practice to be considered to
Speaker 5: be discriminatory by the Education Department, and so they generally
Speaker 5: come to the bargaining table and reach agreements to change
Speaker 5: their practices.
Speaker 2: It's been publicized a lot that displeased donors may pose
Speaker 2: more of a financial threat to the schools.
Speaker 5: Right The Title six lawsuits and the Title six investigations
Speaker 5: by the Office of Civil Rights are just one way
Speaker 5: to try to change behavior on campuses. There's also pressure
Speaker 5: from alumni who are trying to essentially name in shame
Speaker 5: schools to protect Jewish students. And there are powerful and influential,
Speaker 5: wealthy donors who have either directly withheld their gifts or
Speaker 5: they have threatened to do so. So there's a sort
Speaker 5: of multi pronged attack in this effort in the last
Speaker 5: two or three months to try to protect Jewish students
Speaker 5: on campus.
Speaker 2: This lawsuit, is it expected to continue to trial or
Speaker 2: is the Office of Civil Rights going to take it over?
Speaker 2: How does it work?
Speaker 5: The lawsuits that are filed under Title six are in
Speaker 5: federal district court, and so far there have been several
Speaker 5: schools that have been sued, including New York and cal
Speaker 5: Berkeley and Carnegie Mellon as well as Pen, and there's
Speaker 5: more cases expected against other schools, including Harvard and Columbia.
Speaker 5: They will proceed as civil litigation under the federal rules
Speaker 5: of evidence. As in any civil libation, They'll either go
Speaker 5: to trial or they will settle. What the government is
Speaker 5: doing is something separate. Those are administrative cases that will
Speaker 5: not be filed in federal court, and so because their
Speaker 5: administrative cases, it's more likely that they will work more
Speaker 5: directly and cooperatively with the schools to make changes.
Speaker 2: Is the situation getting better with these lawsuits or with
Speaker 2: the publicity brought to this issue, or is it the
Speaker 2: same getting worse? How do the students see it?
Speaker 5: I spoke with lawyers who work for prominent law firms
Speaker 5: who are helping to collect student complaints then get detailed
Speaker 5: information about just what happens on campus, and they said
Speaker 5: that the pace of complaints has been slowing a bit,
Speaker 5: but really it is too soon to tell what the
Speaker 5: outcome will be of these various lawsuits.
Speaker 2: Thanks so much for being on the show, David. That's
Speaker 2: Bloomberg Legal reporter David Voriacis And in news connected to
Speaker 2: the controversy over antisemitism on college campuses, Claudine Gay is
Speaker 2: stepping down as president of Harvard University, ending a brief
Speaker 2: and tumultuous tenure marred by allegations of plagiarism and the
Speaker 2: controversy over antisemitism. Her exit is a dramatic about face
Speaker 2: from her acclaimed start in July as Harvard's first black president.
Speaker 2: Even as recently as December twelfth, she enjoyed the unanimous
Speaker 2: backing of the university's governing council. However, since then, new
Speaker 2: questions have surfaced about her academic work, and a donor
Speaker 2: revolt over the school handling of antisemitism has only worsened.
Speaker 2: It's the second departure in recent weeks of an Ivy
Speaker 2: League president following a House committee hearing on antisemitism on
Speaker 2: US college campuses. Hen President Liz McGill resigned four days
Speaker 2: after that Congressional hearing. And that's it for this edition
Speaker 2: of the Bloomberg Law Show. Remember you can always get
Speaker 2: the latest legal news on our Bloomberg Law Podcast. You
Speaker 2: can find them on Apple Podcasts, Spotify, and at www
Speaker 2: dot bloomberg dot com, slash podcast, slash Law, and remember
Speaker 2: to tune into The Bloomberg Law Show every weeknight at
Speaker 2: ten pm Wall Street Time. I'm Junie Grosso and you're
Speaker 2: listening to Bloomberg