WEBVTT - Trump Charges Dropped & Madigan Corruption Trial

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<v Speaker 1>This is Bloomberg Law with June Brusso from Bloomberg Radio.

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<v Speaker 2>Jack Smith should be considered mentally deranged and he should

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<v Speaker 2>be thrown out of the country. Somebody said, why don't

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<v Speaker 2>you be nice to him? I said, it wouldn't matter.

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<v Speaker 2>Wouldn't matter. This guy's a maniac. We wouldn't be under

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<v Speaker 2>investigation by deranged Jack Smith. He's a deranged human man.

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<v Speaker 2>You take a look at that face. You say that

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<v Speaker 2>guy is a sick man. There's something wrong with him.

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<v Speaker 3>Donald Trump has berated and ridiculed Special counsel Jack Smith

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<v Speaker 3>over and over again, so much so that many consider

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<v Speaker 3>Smith to be at the top of the president elect's

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<v Speaker 3>list of targets when he takes office. But Smith reportedly

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<v Speaker 3>intends to resign before that and a sort of cleaning

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<v Speaker 3>house before inauguration day. Today, he filed motions to drop

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<v Speaker 3>all federal charges against Trump in the case over his

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<v Speaker 3>effort to overturn the twenty two any presidential election and

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<v Speaker 3>the case over his mishandling of classified documents. Joining me

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<v Speaker 3>is Bloomberg Legal reporters Zoe Tillman. Did this come as

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<v Speaker 3>any surprise or were we expecting this?

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<v Speaker 1>We were expecting this in broad strokes, given the Justice

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<v Speaker 1>Department policy which is longstanding that sitting presidents can't be

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<v Speaker 1>charged or prosecuted. And you know, we had confirmation that

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<v Speaker 1>the Special Council would be winding down these prostitutions. I

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<v Speaker 1>think what was unclear was, you know, whether they would

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<v Speaker 1>let stand a lower court ruling finding the Special Council

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<v Speaker 1>and constitutional in the Classified Documents case, or whether they

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<v Speaker 1>would try to preserve some part of that appeal. And

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<v Speaker 1>we got that answer today, which is that they will

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<v Speaker 1>try to move forward with it for now. But you know,

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<v Speaker 1>once Trump takes office, he has the ability to shut

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<v Speaker 1>it down completely or to pardon his co defendants. So

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<v Speaker 1>there's not much more that can be done. But for now,

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<v Speaker 1>at least you know that part of the case is

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<v Speaker 1>still active.

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<v Speaker 3>So the Classified Documents case had already been dismissed by

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<v Speaker 3>a Florida judge, so.

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<v Speaker 1>He dropped the election interference indictment against Trump and also

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<v Speaker 1>said that they would no longer appeal the dismissal of

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<v Speaker 1>charges against Trump in the Classified Documents case. Lower court

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<v Speaker 1>judge in Florida, Judge Aalen Cannon had already dismissed that indictment.

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<v Speaker 1>Finding that Jacksmith's appointment and funding more unconstitutional. So prosecutors

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<v Speaker 1>were in the middle of appealing that decision. They're not

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<v Speaker 1>really dismissing the indictment because it was already dismissed by

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<v Speaker 1>a judge, but they're just saying we're not going to

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<v Speaker 1>appeal anymore. That's part of the case.

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<v Speaker 3>That decision by Judge Eileen Cannon finding the Special Council

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<v Speaker 3>unconstitutional was totally novel and went against all the precedents.

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<v Speaker 3>Do they really want that decision remaining on the books?

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<v Speaker 1>Well, see they right now they've said we are not

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<v Speaker 1>dismissing the appeal. As to Trump's co defendants, Walt Nauda

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<v Speaker 1>and Carlos the ala Vera, there's a reply brief from

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<v Speaker 1>the government in the next few days. If something, they

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<v Speaker 1>don't spile it today along with their notice. The Eleventh

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<v Speaker 1>Circuit hasn't set arguments yet, so it's still possible that

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<v Speaker 1>if the court wanted to move quickly before Trump is

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<v Speaker 1>sworn in on January twentieth, the Eleventh Circuit could hear

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<v Speaker 1>arguments and rule on the issue before he takes office.

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<v Speaker 1>It would be a very expedited schedule. But we've certainly

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<v Speaker 1>seen courts move quickly when asked to under certain circumstances.

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<v Speaker 1>So I think that's the one outstanding question is whether

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<v Speaker 1>prosecutors can you know, get more done on this in

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<v Speaker 1>the next months than a half or so.

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<v Speaker 3>Tell us what jack Smith said specifically, Did he say

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<v Speaker 3>anything about the strength of the case.

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<v Speaker 1>Yeah, so, you know, you could sort of describe it

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<v Speaker 1>as the grudging dismissal of the case in the election

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<v Speaker 1>obstruction case, at least in their notice that they were,

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<v Speaker 1>you know, asking the judge to dismiss it. On the

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<v Speaker 1>first page, Jacksmith says, you know, we stand fully behind

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<v Speaker 1>the strength of the case. This is not about the merits,

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<v Speaker 1>which we still think, you know, we're valid and should

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<v Speaker 1>have moved forward. But that gives Justice Department policy on

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<v Speaker 1>not prosecuting sitting presidents is categorical and sort of forced,

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<v Speaker 1>basically forced his hands, you know. The other thing to

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<v Speaker 1>note is that they asked Judge China Chutkin to dismiss

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<v Speaker 1>the indictment without prejudice, which sort of leaves the door

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<v Speaker 1>open to a future Justice Department four years from now

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<v Speaker 1>under whoever is president next, thinking about whether they would

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<v Speaker 1>want to try it again, which then raisesultsors of questions

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<v Speaker 1>about whether, you know, could Trump self pardon in the

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<v Speaker 1>White House to head off that possibility. It's just a

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<v Speaker 1>lot of uncertainty. But you know, notable that they didn't

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<v Speaker 1>say we're going to close the door on this altogether.

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<v Speaker 3>So this really shows how Trump's policy in all his

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<v Speaker 3>cases of delay, delay, delay, really worked for him.

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<v Speaker 1>It did, I think, there's no question about that. And

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<v Speaker 1>you know, from the beginning the move had been to

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<v Speaker 1>argue in favor of schedules. You know, first they were

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<v Speaker 1>saying there should be no trial to ask the election,

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<v Speaker 1>and no judge was on board with that, even in Florida,

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<v Speaker 1>where you know, Judge Cannon was seen as more accommodating

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<v Speaker 1>of you know, what the president elect was asking for.

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<v Speaker 1>But she Eden said, I'm not going to push this back,

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<v Speaker 1>you know, until after the election is and do that

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<v Speaker 1>kind of political calendar making. But in the end, you know,

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<v Speaker 1>he successfully pressed appeals that delayed. He raised issues that

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<v Speaker 1>just forced later deadlines by virtue of the rule criminal

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<v Speaker 1>rules of person jervis. He files motions that requires responses,

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<v Speaker 1>and everyone needs time to press the briefs and argue.

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<v Speaker 1>You know, Judge Chucklin and Washington tried very hard to

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<v Speaker 1>keep her case on track. But when there's a question

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<v Speaker 1>of presidential immunity, that is, and everyone agreed that is

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<v Speaker 1>immediately appealable up to the Supreme Court, and these things

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<v Speaker 1>just take time, so you know, to the extent, they

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<v Speaker 1>found ways to file motions that no one could really

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<v Speaker 1>argue would build in delays. They ran out the crocs successfully, and.

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<v Speaker 3>The Supreme Court helped out with its decision on presidential immunity.

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<v Speaker 1>I mean, the court did side with him. He prevailed

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<v Speaker 1>in that they didn't agree that he had absolute immunity

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<v Speaker 1>against the case, so it kept it alive. But certainly,

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<v Speaker 1>you know, the majority of justices agreed with him that

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<v Speaker 1>at least some of the indictment would be off limits,

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<v Speaker 1>the part dealing with his discussions with Justice Department officials,

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<v Speaker 1>anything that was sort of overtly part of business in

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<v Speaker 1>the White House. And then you know, said we're going

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<v Speaker 1>to send it back to a lower court judge to

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<v Speaker 1>do another round of determinations. So you know, in theory,

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<v Speaker 1>I guess the Supreme Court could have said, we're going

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<v Speaker 1>to resolve all these questions ourselves and put the case

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<v Speaker 1>back on track if they thought that any part of

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<v Speaker 1>it could survive, but didn't send it back to Judge Chuckkin,

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<v Speaker 1>who then had to set up schedule for more brief

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<v Speaker 1>And at that point it seems impossible that it could

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<v Speaker 1>be on track for a trial before election day.

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<v Speaker 3>So still Judge Chuckkin has to sign off on this.

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<v Speaker 4>She does yees.

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<v Speaker 1>Generally speaking, judges have very little discussion in these types

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<v Speaker 1>of situations if the government says we don't want to

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<v Speaker 1>pursue this case anymore, especially ahead of a trial. You know,

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<v Speaker 1>one instance where we saw judge put a hold on

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<v Speaker 1>cod trying to drop something within the case of Michael Flynn,

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<v Speaker 1>who was Trump's former national security advisor, and Flynn had

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<v Speaker 1>been prosecuted under a former Special Council and then spun

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<v Speaker 1>off to a US attorney office related to the Russian investigation.

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<v Speaker 1>But Michael Frinn had already had pleaded guilty. So the

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<v Speaker 1>judge in that case has said, you know, I'm not

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<v Speaker 1>sure if I can drop this right away if he's

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<v Speaker 1>already been factual findings about guilt and acceptance of responsibility,

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<v Speaker 1>et cetera, et cetera. But that's not the case here.

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<v Speaker 1>There's been no fact finding. It's much early. Even though

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<v Speaker 1>it feels like so much has happened, it's really much

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<v Speaker 1>earlier in the proceedings. So, you know, I don't think

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<v Speaker 1>there's an expectation that Judge Chuckkins would refuse to dismiss

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<v Speaker 1>it at this point. But whether she calls them in

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<v Speaker 1>for some other reason, you know, it's with final questions.

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<v Speaker 1>I guess we could wait and see that. It would

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<v Speaker 1>be very unusual to have her do that.

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<v Speaker 3>Now, what about Jack Smith? There are reports that he

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<v Speaker 3>is going to step down before Trump takes.

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<v Speaker 1>Office, So our reporting has signaled that he is expected

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<v Speaker 1>to resign from his position as special counsel before Trump

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<v Speaker 1>is sworn in. Whether he would leave the Justice Department

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<v Speaker 1>all together, you know, sort of what form that takes exactly,

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<v Speaker 1>we're not sure and waiting to see sort of what

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<v Speaker 1>he announces he'll do. You know, we're waiting to also

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<v Speaker 1>see if he finishes a report on his investigation on

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<v Speaker 1>his work, what happens with that, so you know, today

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<v Speaker 1>it doesn't walk out the door and never come.

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<v Speaker 5>Back, you think.

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<v Speaker 1>So we're not quite sure. But you know, even if

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<v Speaker 1>he were to stay in the Justice Department in some

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<v Speaker 1>capacity in the next few weeks. There's little doubt that

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<v Speaker 1>Trump would fire him immediately.

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<v Speaker 3>Well, Trump has promised that, and he's also said that

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<v Speaker 3>Smith should be thrown out of the country. That seems

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<v Speaker 3>beyond even his power as a president. But isn't Smith

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<v Speaker 3>required to file a report on his charging decisions to

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<v Speaker 3>the Attorney General before he leaves office?

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<v Speaker 1>You know, I'd have to go back and check their regulations,

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<v Speaker 1>but the expectation is that you will write a report

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<v Speaker 1>and submit that to the Attorney General to close out

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<v Speaker 1>his office, sort of administrative task that he also has

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<v Speaker 1>to do. We'll get a final budget report as he

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<v Speaker 1>closes down on the office, you know. I guess another

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<v Speaker 1>unanswered question is if there were other investigative threads that

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<v Speaker 1>they were pursuing, whether they would send those files, you know,

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<v Speaker 1>send them off to a US attorney office for further investigation,

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<v Speaker 1>or to redirect them like we saw with Special Council Luller,

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<v Speaker 1>where you know, certain issues were redirected to US attorney

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<v Speaker 1>offices after he left. So, you know, I think this

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<v Speaker 1>is not little astically heard from Jacksmith. But I think

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<v Speaker 1>depending on timing, you know, he files his report before

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<v Speaker 1>inauguration and the pressure will be on Attorney General's Garland

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<v Speaker 1>to release that ice effect. But we just haven't heard

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<v Speaker 1>one way or the other sort of what's next, And

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<v Speaker 1>so we.

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<v Speaker 3>Tell us about the push from Texas to get access

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<v Speaker 3>to Smith's files.

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<v Speaker 1>There's a case pending from the Texas Attorney General's office.

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<v Speaker 1>Kim Paxton has been a long time ally of Trump,

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<v Speaker 1>trying to get Jacksmith's files and release more of his

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<v Speaker 1>work and what happened in that office. I think there's

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<v Speaker 1>also the next beat will be like the investigation into

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<v Speaker 1>the investigation of Jack Smith.

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<v Speaker 3>It seems to be never ending, and one has to

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<v Speaker 3>wonder about what parts of Jack Smith's investigation the Texas

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<v Speaker 3>Attorney General would release to the public. Some more to come,

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<v Speaker 3>Thanks so much, Zoe. That's Bloomberg Legal reporter Zoe Tillman.

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<v Speaker 3>Coming up next on the Bloomberg Law Show. Federal prosecutors

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<v Speaker 3>are presenting their case in the trial of the longest

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<v Speaker 3>serving House leader in the country, Michael Madigan. I'm June

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<v Speaker 3>Grosso and you're listening to Bloomberg Dan.

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<v Speaker 4>Yes, Mike Madigan speaker, How are you? I I'm good.

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<v Speaker 3>How are you? Michael Madigan, the longest serving House leader

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<v Speaker 3>of any state in US history. Is an almost mythical

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<v Speaker 3>figure in Illinois politics. His three decade rain earned him

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<v Speaker 3>the nickname the Velvet Hammer because of the way he

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<v Speaker 3>led the Illinois House and extracted fealty from its members.

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<v Speaker 4>If you can get near you, mind that your client

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<v Speaker 4>is only Mike Madigan.

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<v Speaker 3>Now, the eighty two year old Madigan is on trial

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<v Speaker 3>for bribery, extortion, and racketeering for allegedly running a criminal

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<v Speaker 3>enterprise to add to his vast political power, get business

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<v Speaker 3>for his private law firm and reward his friends and allies.

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<v Speaker 3>Government attorneys are building their case against him with witnesses

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<v Speaker 3>who've made plea deals and war wires, documents, emails, and

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<v Speaker 3>hundreds of wiretap conversations like these.

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<v Speaker 4>I generally never refer to the speaker. I just say

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<v Speaker 4>our friend. So if you could say our friend, no

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<v Speaker 4>one really knows what we're talking about.

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<v Speaker 5>Speak of that.

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<v Speaker 4>Hey, micaeh, Hey, will you tell the speaker I took

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<v Speaker 4>care of burials and Pennonovic Did you just throw away

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<v Speaker 4>that note? Yep.

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<v Speaker 3>For those outside of Illinois who don't know about Madigan,

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<v Speaker 3>you know, tell us a little bit about his background.

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<v Speaker 3>Why you was nicknamed the velvet hammer.

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<v Speaker 5>So Mike Madigan is the longest serving speaker of the

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<v Speaker 5>Illinois House in history, and in addition to the extraordinary

0:13:06.480 --> 0:13:10.679
<v Speaker 5>political power and influence that he wielded from that position,

0:13:11.440 --> 0:13:15.319
<v Speaker 5>he also had a private practice of laws. The indictment

0:13:15.400 --> 0:13:19.760
<v Speaker 5>charges that he used both of these positions to retain

0:13:19.920 --> 0:13:21.520
<v Speaker 5>and consolidate his power.

0:13:22.480 --> 0:13:26.960
<v Speaker 3>So the prosecutors are alleging that he used his political

0:13:27.000 --> 0:13:30.400
<v Speaker 3>power in offices as a criminal enterprise. I mean, what

0:13:30.559 --> 0:13:32.240
<v Speaker 3>exactly are they charging there?

0:13:32.960 --> 0:13:37.439
<v Speaker 5>Yes, that's exactly right, a criminal enterprise which is casually

0:13:37.480 --> 0:13:42.400
<v Speaker 5>referred to as the Madigan enterprise. And in brief, it

0:13:42.559 --> 0:13:45.320
<v Speaker 5>boils down to what is at the heart of all

0:13:45.360 --> 0:13:50.680
<v Speaker 5>public corruption cases, which is precisely money and power, the

0:13:50.760 --> 0:13:54.400
<v Speaker 5>abuse of public office for private gain, and the abuse

0:13:54.480 --> 0:13:59.120
<v Speaker 5>of power to retain and consolidate power. The evidence that's

0:13:59.160 --> 0:14:03.440
<v Speaker 5>been introduced in the case so far focuses on Commed,

0:14:03.960 --> 0:14:09.920
<v Speaker 5>the public utility here in Illinois, and Madigan's essentially leveraging

0:14:10.360 --> 0:14:17.120
<v Speaker 5>commed dependence on his political power, depending on Madigan's support

0:14:17.320 --> 0:14:22.080
<v Speaker 5>for legislation and policy that are favorable to Commed in

0:14:22.240 --> 0:14:28.320
<v Speaker 5>exchange for a variety of things. This is one large

0:14:28.320 --> 0:14:29.680
<v Speaker 5>issue among others.

0:14:29.880 --> 0:14:34.480
<v Speaker 3>His co defendant, Mike McClain, And he's already been convicted

0:14:34.480 --> 0:14:37.600
<v Speaker 3>on public corruption charges. Why are they trying to show

0:14:37.600 --> 0:14:39.760
<v Speaker 3>that he's an agent of Madigan?

0:14:40.480 --> 0:14:43.520
<v Speaker 5>So Mike mclan, as you say, has already been convicted

0:14:43.560 --> 0:14:46.320
<v Speaker 5>in a separate trial. That trial is referred to as

0:14:46.360 --> 0:14:49.960
<v Speaker 5>the trial of the comment for in this instance, Mike

0:14:50.040 --> 0:14:53.320
<v Speaker 5>McLean is charged as a co defendant and an agent

0:14:54.160 --> 0:14:58.640
<v Speaker 5>of the former speaker Mike Madigan. And under an agency

0:14:58.680 --> 0:15:04.760
<v Speaker 5>theory of liabil Mike Madigan's knowledge, his criminal intent, and

0:15:04.840 --> 0:15:09.080
<v Speaker 5>the actions that he directs are all imputed to Mike

0:15:09.200 --> 0:15:12.880
<v Speaker 5>McLean as his agent. This is the theory of the prosecution.

0:15:13.120 --> 0:15:15.080
<v Speaker 5>Of course, mister McLean contests it.

0:15:15.440 --> 0:15:18.800
<v Speaker 3>Let's talk about the defense. Is the defense that this

0:15:18.840 --> 0:15:21.400
<v Speaker 3>is what politicians do? Is it that defense that we've

0:15:21.400 --> 0:15:23.720
<v Speaker 3>heard a million times? Or is there more to it?

0:15:24.120 --> 0:15:28.360
<v Speaker 5>That is essentially the defense. It is a defense that

0:15:28.600 --> 0:15:32.680
<v Speaker 5>has gained credence in recent years with a series of

0:15:32.800 --> 0:15:37.240
<v Speaker 5>Supreme Court rulings that have held in essence that federal

0:15:37.320 --> 0:15:41.880
<v Speaker 5>prosecutors have been overly ambitious with their interpretation of public

0:15:41.880 --> 0:15:49.640
<v Speaker 5>corruption laws and have swept into their prosecutions instances of

0:15:50.200 --> 0:15:56.360
<v Speaker 5>politics as usual constituent services, and the type of deal making,

0:15:57.040 --> 0:16:01.080
<v Speaker 5>which is how the sausage is made. And in the

0:16:01.120 --> 0:16:04.800
<v Speaker 5>words of Chief Justice John Roberts in the case of

0:16:05.040 --> 0:16:09.520
<v Speaker 5>the former Virginia governor Bob McDonald, it may be unseemly,

0:16:09.960 --> 0:16:11.680
<v Speaker 5>but that doesn't mean it's criminal.

0:16:12.400 --> 0:16:15.520
<v Speaker 3>The Supreme Court has been pairing back public corruption law

0:16:15.680 --> 0:16:21.320
<v Speaker 3>since the McDonald case, and last June, in the Snyder case,

0:16:21.800 --> 0:16:25.720
<v Speaker 3>the Justices undid the conviction of a former Indiana mayor

0:16:26.360 --> 0:16:30.480
<v Speaker 3>who received thirteen thousand dollars from a trucking company after

0:16:30.560 --> 0:16:34.200
<v Speaker 3>it was awarded city contracts. In this case, how are

0:16:34.240 --> 0:16:37.960
<v Speaker 3>the prosecutors getting around the Snyder decision?

0:16:39.200 --> 0:16:41.640
<v Speaker 5>Well, First of all, the Snyder case involved a very

0:16:41.640 --> 0:16:47.480
<v Speaker 5>particular statute. It involved a charge of illegal gratuities, which

0:16:47.520 --> 0:16:52.280
<v Speaker 5>the prosecution argued was included in eighteen US could six

0:16:52.320 --> 0:16:54.560
<v Speaker 5>sixty six, which is a federal law that applies to

0:16:54.640 --> 0:16:57.720
<v Speaker 5>state and local bribery. The Supreme Court Court ruled in

0:16:57.800 --> 0:17:02.080
<v Speaker 5>Snyder that that interpretation was in correct, that six sixty

0:17:02.120 --> 0:17:06.080
<v Speaker 5>six encompasses quid pro quol bribery, but not illegal gratuities,

0:17:06.119 --> 0:17:10.160
<v Speaker 5>which was the theory of liability in Snyder. The Madigan

0:17:10.240 --> 0:17:15.119
<v Speaker 5>case by contrast, is not a theory of illegal gratuities. Rather,

0:17:15.320 --> 0:17:19.600
<v Speaker 5>it is a criminal enterprise. So rico is charged along

0:17:19.640 --> 0:17:24.480
<v Speaker 5>with wire fraud and actual bribery. Bribery is considered one

0:17:24.480 --> 0:17:28.880
<v Speaker 5>of the necessary predicate offenses that can be used as

0:17:28.920 --> 0:17:31.480
<v Speaker 5>a basis to charge a racketeering enterprise.

0:17:32.160 --> 0:17:35.800
<v Speaker 3>Are quid pro quo allegations key to the government's case

0:17:35.840 --> 0:17:38.280
<v Speaker 3>against Madigan and McLain.

0:17:38.880 --> 0:17:43.679
<v Speaker 5>A theory of quid pro quo liability, yes, But the

0:17:43.760 --> 0:17:47.959
<v Speaker 5>reason that quid pro quo, although it's a commonly used

0:17:48.080 --> 0:17:52.280
<v Speaker 5>term in the vernacular for corruption, is not a legal

0:17:52.359 --> 0:17:57.120
<v Speaker 5>term of art, is because in truth, corrupt acts are

0:17:57.720 --> 0:18:01.840
<v Speaker 5>most often far more complex than the concepts of this

0:18:02.080 --> 0:18:05.280
<v Speaker 5>for that. So, in the case that's been brought by

0:18:05.320 --> 0:18:10.240
<v Speaker 5>the government against Madigan, what is alleged is that essentially

0:18:10.800 --> 0:18:15.960
<v Speaker 5>comed owed Mike Madigan. The company was indebted to him

0:18:16.400 --> 0:18:22.680
<v Speaker 5>for numerous times he had helped them benefit with legislation

0:18:23.359 --> 0:18:26.840
<v Speaker 5>that was favorable to the company. So you're in a

0:18:26.880 --> 0:18:34.480
<v Speaker 5>situation where the defendant already has influenced power, clout and leverage.

0:18:35.080 --> 0:18:37.960
<v Speaker 5>What is alleged is that Mike Madgan in turn then

0:18:38.280 --> 0:18:44.000
<v Speaker 5>use that to demand favors from coned, So it is

0:18:44.040 --> 0:18:47.199
<v Speaker 5>a quid pro quo, but it's not a simple or

0:18:47.240 --> 0:18:48.520
<v Speaker 5>isolated transaction.

0:18:49.400 --> 0:18:53.880
<v Speaker 3>So the government has all kinds of evidence. People who

0:18:54.000 --> 0:18:58.679
<v Speaker 3>wore wires, the wire tapped, they have documents. What do

0:18:58.720 --> 0:19:02.840
<v Speaker 3>you see as the longest evidence they have so far.

0:19:03.440 --> 0:19:07.879
<v Speaker 5>All of the government's evidence has strengths, and it also

0:19:08.040 --> 0:19:12.480
<v Speaker 5>has ways in which it can be attacked by defense counsel,

0:19:12.680 --> 0:19:16.879
<v Speaker 5>and it is being attacked by defense counsel. Government witnesses

0:19:16.920 --> 0:19:21.560
<v Speaker 5>who are so called cooperating witnesses, including those who have

0:19:21.720 --> 0:19:26.040
<v Speaker 5>negotiated flea deals, of course, have received the benefit from

0:19:26.080 --> 0:19:30.080
<v Speaker 5>the government. These are individuals who have negotiated a flee

0:19:30.080 --> 0:19:33.679
<v Speaker 5>deal in exchange for their cooperation with the government, and

0:19:33.760 --> 0:19:38.360
<v Speaker 5>they have an expectation of a reduced sentence. Therefore, Council

0:19:38.440 --> 0:19:42.360
<v Speaker 5>for the Defense will be cross examining them on their bias,

0:19:42.359 --> 0:19:46.280
<v Speaker 5>on their incentive to curry favor with the government, and

0:19:46.680 --> 0:19:49.600
<v Speaker 5>arguably what they will certainly argue to the jury is

0:19:49.640 --> 0:19:54.439
<v Speaker 5>that those witnesses are therefore not credible, not to be believed. Recordings,

0:19:54.760 --> 0:19:58.160
<v Speaker 5>of course, are not of witnesses who may or may

0:19:58.200 --> 0:20:01.439
<v Speaker 5>not have an incentive to shade the truth on the

0:20:01.480 --> 0:20:05.680
<v Speaker 5>witness stand. A famous Chicago defense attorney once said, you

0:20:05.720 --> 0:20:10.080
<v Speaker 5>don't need to believe me, Just believe mister Panasonic. You

0:20:10.200 --> 0:20:14.239
<v Speaker 5>press play, and the recording speaks for itself. Now, in

0:20:14.280 --> 0:20:20.400
<v Speaker 5>some instances, these recordings are grainy, of lower quality, may

0:20:20.440 --> 0:20:24.960
<v Speaker 5>not be the smoking gun that they have been made

0:20:24.960 --> 0:20:27.879
<v Speaker 5>out to be. And so I am certain that the

0:20:28.000 --> 0:20:34.080
<v Speaker 5>jury is listening very carefully when the videos and audio

0:20:34.119 --> 0:20:38.159
<v Speaker 5>recordings are played to see if the content actually lines

0:20:38.240 --> 0:20:41.600
<v Speaker 5>up with what the government promised the evidence would show

0:20:41.840 --> 0:20:45.320
<v Speaker 5>in its opening statement, because you can bet that if

0:20:45.359 --> 0:20:50.159
<v Speaker 5>it doesn't, when the defense makes its closing argument, it

0:20:50.200 --> 0:20:52.880
<v Speaker 5>will point out the ways in which the government's case

0:20:52.920 --> 0:20:53.520
<v Speaker 5>fell short.

0:20:54.119 --> 0:20:58.760
<v Speaker 3>Some of the recordings seemed pretty stunning, one where MacLean said,

0:20:59.160 --> 0:21:02.680
<v Speaker 3>your client is only mag Madigan. It's not the Democratic Party,

0:21:02.720 --> 0:21:05.440
<v Speaker 3>it's not anybody who hired you, it's not your mom

0:21:05.480 --> 0:21:09.199
<v Speaker 3>and dad. But the defense, I assume, can frame that

0:21:09.280 --> 0:21:10.160
<v Speaker 3>in a different.

0:21:09.880 --> 0:21:13.800
<v Speaker 5>Way, certainly, and you can see both sides of that coin.

0:21:14.720 --> 0:21:19.399
<v Speaker 5>On the one hand, it speaks to Speaker Madigan's really

0:21:19.520 --> 0:21:25.760
<v Speaker 5>extraordinary influence in a way that certainly undermines a democratic

0:21:25.880 --> 0:21:30.639
<v Speaker 5>or meritocratic process. On the other hand, you can say, well, yeah,

0:21:31.080 --> 0:21:34.840
<v Speaker 5>who is the leading Democrat in Illinois. He was conflated

0:21:35.359 --> 0:21:39.320
<v Speaker 5>with the Democratic Party, and MacLean is just making clear

0:21:39.359 --> 0:21:43.760
<v Speaker 5>that Madigan's agenda is the overwhelming agenda that we'll get

0:21:43.800 --> 0:21:46.560
<v Speaker 5>through in Springfield, and indeed, for many years that was

0:21:46.600 --> 0:21:47.040
<v Speaker 5>the case.

0:21:47.200 --> 0:21:50.120
<v Speaker 3>Is there any indication that Madigan might take the stand.

0:21:50.520 --> 0:21:54.600
<v Speaker 5>There has been no indication as of yet. He will

0:21:54.640 --> 0:21:58.080
<v Speaker 5>need to make that decision when the government rests its case.

0:21:58.280 --> 0:22:01.400
<v Speaker 5>The government is still, of course presenting its case in chief,

0:22:02.080 --> 0:22:05.600
<v Speaker 5>and the burden of proof remains with the government at

0:22:05.640 --> 0:22:10.040
<v Speaker 5>all times. The Speaker, of course, is entitled to a

0:22:10.119 --> 0:22:13.720
<v Speaker 5>presumption of innocence and also entitled to a right to

0:22:13.800 --> 0:22:17.440
<v Speaker 5>remain silent. So if he chooses not to take the stand,

0:22:18.000 --> 0:22:20.800
<v Speaker 5>the jury must draw no inference from that, and the

0:22:20.840 --> 0:22:25.680
<v Speaker 5>government cannot comment on it. Speaker Madigan is obviously an

0:22:25.680 --> 0:22:30.320
<v Speaker 5>intelligent and shrewd person, and I imagine that he's listening

0:22:30.440 --> 0:22:34.760
<v Speaker 5>very closely along with his skilled defense counsel as the

0:22:34.880 --> 0:22:39.560
<v Speaker 5>evidence comes in. If you're asking me to place a wager,

0:22:39.760 --> 0:22:42.600
<v Speaker 5>I will wager that he is not going to take

0:22:42.640 --> 0:22:43.119
<v Speaker 5>a stand.

0:22:43.560 --> 0:22:46.960
<v Speaker 3>The prosecution would certainly have a lot to cross examine

0:22:47.040 --> 0:22:50.080
<v Speaker 3>him on if he did. As you mentioned, there were

0:22:50.080 --> 0:22:54.159
<v Speaker 3>guilty verdicts against Commed's former top executive and three of

0:22:54.160 --> 0:22:57.840
<v Speaker 3>its former lobbyists. We're conspiring to bribe Madigan. But then

0:22:57.960 --> 0:23:01.440
<v Speaker 3>a trial on charges at form At and t Illinois

0:23:01.520 --> 0:23:06.520
<v Speaker 3>President Paul Lacchiatza illegally influenced the X speaker resulted in

0:23:06.560 --> 0:23:09.879
<v Speaker 3>a hung jury. Was there a problem in that later

0:23:10.000 --> 0:23:14.520
<v Speaker 3>trial that the government might encounter in a Madigan trial?

0:23:14.680 --> 0:23:17.520
<v Speaker 5>So the problem with that case is the problem with

0:23:17.640 --> 0:23:21.000
<v Speaker 5>all public corruption and indeed white collar cases. These are

0:23:21.040 --> 0:23:26.040
<v Speaker 5>specific intent crimes, and the government must prove corrupt intent

0:23:26.359 --> 0:23:31.040
<v Speaker 5>beyond a reasonable doubt. So not just the actions themselves,

0:23:31.200 --> 0:23:35.600
<v Speaker 5>but the individual's state of mind. And when one can

0:23:35.800 --> 0:23:39.360
<v Speaker 5>argue that a state of mind is politics as usual,

0:23:39.520 --> 0:23:42.240
<v Speaker 5>and you do hear that line in the Madigan trial

0:23:42.280 --> 0:23:45.000
<v Speaker 5>as well. This is how things are done in Illinois.

0:23:45.119 --> 0:23:49.280
<v Speaker 5>This is politics as usual that can undermine evidence that

0:23:49.400 --> 0:23:53.280
<v Speaker 5>goes to corrupt intent, especially when it is circumstantial evidence.

0:23:53.280 --> 0:23:58.840
<v Speaker 5>And that's another point. These individuals are smart, they are sophisticated.

0:23:59.359 --> 0:24:02.800
<v Speaker 5>You will never here then use the term quid pro quo.

0:24:03.359 --> 0:24:06.880
<v Speaker 5>You will never hear then use the word bribe. And

0:24:07.000 --> 0:24:13.239
<v Speaker 5>so frequently the evidence in corruption cases is circumstantial, and

0:24:13.359 --> 0:24:17.320
<v Speaker 5>jurors are asked to draw reasonable inferences from the evidence.

0:24:17.640 --> 0:24:21.200
<v Speaker 5>So access the prostitutions of public corruption cases are hard?

0:24:21.720 --> 0:24:24.800
<v Speaker 3>Are they harder in Illinois? Because the city is known

0:24:24.880 --> 0:24:28.840
<v Speaker 3>from the days of mayor daily and you've had several

0:24:29.160 --> 0:24:33.560
<v Speaker 3>I think Illinois governors who've been prosecuted. I mean, are

0:24:33.600 --> 0:24:38.440
<v Speaker 3>the citizens of Chicago sort of inord to it? You know?

0:24:38.480 --> 0:24:40.680
<v Speaker 3>Are they just sort of stealed against it?

0:24:40.960 --> 0:24:45.439
<v Speaker 5>Well, the social science literature related to popular perceptions of

0:24:45.520 --> 0:24:50.720
<v Speaker 5>corruption indicates the opposite. Actually, public corruption is deeply unpopular

0:24:51.720 --> 0:24:55.960
<v Speaker 5>with ordinary citizens, and indeed it is something that motivates

0:24:56.240 --> 0:24:59.680
<v Speaker 5>people when it comes to casting votes to seek in

0:24:59.760 --> 0:25:03.520
<v Speaker 5>coll change. I'm not in a position to say whether

0:25:03.720 --> 0:25:08.199
<v Speaker 5>public corruption prosecutions are harder or easier in Illinois, but

0:25:08.400 --> 0:25:10.359
<v Speaker 5>I would tend to doubt that they would be harder.

0:25:10.600 --> 0:25:12.840
<v Speaker 3>A long way to go in this one, yet, Thanks

0:25:12.880 --> 0:25:17.280
<v Speaker 3>so much, Juliet. That's Professor Juliet Sorenson of Loyola University

0:25:17.359 --> 0:25:20.720
<v Speaker 3>Chicago Law School coming up the Supreme Court today. This

0:25:20.840 --> 0:25:24.800
<v Speaker 3>is Bloomberg. The Supreme Court released its calendar for the

0:25:24.840 --> 0:25:30.200
<v Speaker 3>February argument session. The justices will hear cases on reverse discrimination,

0:25:30.760 --> 0:25:35.600
<v Speaker 3>nuclear fuel storage, post conviction DNA testing, and whether the

0:25:35.640 --> 0:25:40.240
<v Speaker 3>Mexican government can sue US gun manufacturers. And today the

0:25:40.520 --> 0:25:43.360
<v Speaker 3>Justices announced that they'll weigh a new line of attack

0:25:43.520 --> 0:25:48.480
<v Speaker 3>on federal administrative power, agreeing to consider the constitutionality of

0:25:48.560 --> 0:25:52.600
<v Speaker 3>the decades old Universal Service Fund. Joining me is Bloomberg

0:25:52.640 --> 0:25:56.400
<v Speaker 3>Supreme Court reporter Greg store So, Greg tell us about

0:25:56.400 --> 0:26:00.760
<v Speaker 3>the Universal Service Fund, which some people may not know about,

0:26:00.800 --> 0:26:04.040
<v Speaker 3>but there's a charge on there wireless phone bills for

0:26:04.160 --> 0:26:04.919
<v Speaker 3>it every month.

0:26:05.320 --> 0:26:08.720
<v Speaker 6>So this is an eight billion dollar program. And what

0:26:08.760 --> 0:26:11.280
<v Speaker 6>it is at the standpoint of a consumer, on your

0:26:11.320 --> 0:26:14.520
<v Speaker 6>monthly phone bill, there's a charge for there's a Universal

0:26:14.560 --> 0:26:18.480
<v Speaker 6>Service Fund, and that is used to subsidize the cost

0:26:18.600 --> 0:26:23.440
<v Speaker 6>of phone and internet service for poor people in rural areas,

0:26:23.480 --> 0:26:27.679
<v Speaker 6>for schools and libraries. And that program has been around

0:26:27.720 --> 0:26:31.000
<v Speaker 6>since nineteen ninety six tele Communications Act. But now it

0:26:31.080 --> 0:26:35.160
<v Speaker 6>is being challenged as exceeding both Congress's authority and the

0:26:35.200 --> 0:26:37.800
<v Speaker 6>Federal Communications Commission's authority.

0:26:38.280 --> 0:26:41.320
<v Speaker 3>So this was a circuit split, I mean, basically, was

0:26:41.320 --> 0:26:45.640
<v Speaker 3>the Fifth Circuit, which is often an outliers circuit, extremely conservative,

0:26:45.840 --> 0:26:47.159
<v Speaker 3>And what did the Fifth.

0:26:46.880 --> 0:26:50.359
<v Speaker 6>Circuit do with Fifth Circuit declared it invalid. That caused

0:26:50.359 --> 0:26:52.520
<v Speaker 6>a split with two other appeals courts that had said

0:26:52.720 --> 0:26:56.040
<v Speaker 6>it was constitutional, and the Fifth Circuit said it was

0:26:56.080 --> 0:26:58.879
<v Speaker 6>invalid sort of for a combination of reasons. There is

0:26:58.960 --> 0:27:02.240
<v Speaker 6>this doctrine that is known as the non delegation doctrine

0:27:02.280 --> 0:27:04.639
<v Speaker 6>that the Supreme Court hasn't invoked since the New Deal.

0:27:05.000 --> 0:27:08.200
<v Speaker 6>But the idea is that Congress can't just hand off

0:27:08.280 --> 0:27:13.520
<v Speaker 6>its legislative power to a federal agency. And then there's

0:27:13.560 --> 0:27:17.440
<v Speaker 6>also this related notion as the private non delegation doctrine,

0:27:17.480 --> 0:27:20.479
<v Speaker 6>which is that the agency can't just hand over its

0:27:20.480 --> 0:27:25.280
<v Speaker 6>authority to some private entity. And this circuit said that

0:27:25.440 --> 0:27:28.199
<v Speaker 6>this program was set up in a way where the

0:27:28.240 --> 0:27:30.760
<v Speaker 6>Congress gave an awful lot of authority to the SEC

0:27:30.920 --> 0:27:33.120
<v Speaker 6>to set the amounts of that charge on your phone bill,

0:27:33.400 --> 0:27:35.960
<v Speaker 6>and then the SEC in turn gave a private entity

0:27:36.000 --> 0:27:39.000
<v Speaker 6>a lot of power to determine exactly what that charge

0:27:39.000 --> 0:27:41.960
<v Speaker 6>would be. And the combination of those two issues made

0:27:42.000 --> 0:27:46.280
<v Speaker 6>it unconstitutional, a violation of the separation of powers.

0:27:46.640 --> 0:27:50.600
<v Speaker 3>Are people anticipating that the Supreme Court may use this

0:27:50.800 --> 0:27:54.920
<v Speaker 3>case to cut back further on agency powers.

0:27:55.440 --> 0:27:58.439
<v Speaker 6>It's certainly a possibility now I don't want to read

0:27:58.520 --> 0:28:00.520
<v Speaker 6>too much into the fact that they took this case.

0:28:00.560 --> 0:28:03.280
<v Speaker 6>They didn't have a whole lot of choice, given that

0:28:03.480 --> 0:28:06.000
<v Speaker 6>the Fifth Circuit had said this program is invalid, and

0:28:06.000 --> 0:28:08.399
<v Speaker 6>two other appeal sports had gone the other way. But

0:28:08.960 --> 0:28:11.639
<v Speaker 6>this notion of the non delegation doctrine is sort of

0:28:11.840 --> 0:28:14.400
<v Speaker 6>the last big thing. Let me, I shouldn't ay last

0:28:14.400 --> 0:28:17.120
<v Speaker 6>big thing, but the next big thing for people who

0:28:17.160 --> 0:28:20.720
<v Speaker 6>want to reduce administrative power. So the Supreme Court a

0:28:20.760 --> 0:28:23.920
<v Speaker 6>few years ago establish the thing called the Major Questions

0:28:23.960 --> 0:28:26.480
<v Speaker 6>Doctrine that said Congress has to be super clear if

0:28:26.480 --> 0:28:29.560
<v Speaker 6>it's going to delegate a major question to an agency.

0:28:30.000 --> 0:28:33.480
<v Speaker 6>Then the Court last term overturned the so called Chevron

0:28:33.600 --> 0:28:36.000
<v Speaker 6>doctrine that gave agency is an awful lot of discretion

0:28:36.520 --> 0:28:39.520
<v Speaker 6>to interpret ambiguous statutes. And this is sort of the

0:28:39.520 --> 0:28:43.440
<v Speaker 6>next thing. It would potentially limit what Congress can do.

0:28:43.880 --> 0:28:46.720
<v Speaker 6>It would say there are constitutional limits to what Congress

0:28:46.720 --> 0:28:50.880
<v Speaker 6>can hand off to the agency. In terms of legislative power.

0:28:50.960 --> 0:28:53.640
<v Speaker 6>Congress has to be the one to make these decisions

0:28:53.760 --> 0:28:56.479
<v Speaker 6>like say how big this this charge is that's going

0:28:56.480 --> 0:28:57.320
<v Speaker 6>to be on your phone bill?

0:28:57.440 --> 0:29:02.000
<v Speaker 3>Greg The arguments will take place when Trump has already

0:29:02.280 --> 0:29:05.640
<v Speaker 3>taken office, so there'll be a new solicitor general. I mean,

0:29:05.760 --> 0:29:10.560
<v Speaker 3>might the Trump administration reverse course and disagree with the

0:29:10.560 --> 0:29:11.520
<v Speaker 3>Biden administration.

0:29:11.960 --> 0:29:15.360
<v Speaker 6>It's certainly possible, and it's worth watching. This is not

0:29:15.560 --> 0:29:19.760
<v Speaker 6>one of those things that this fund. The criticisms about

0:29:19.800 --> 0:29:25.240
<v Speaker 6>this fund have tended to be more about what businesses

0:29:25.320 --> 0:29:27.960
<v Speaker 6>are in charge of collecting it. And so right now,

0:29:28.040 --> 0:29:29.400
<v Speaker 6>I said that this is the charge that shows up

0:29:29.440 --> 0:29:32.120
<v Speaker 6>in your phone bill, so that the telecom companies that

0:29:32.240 --> 0:29:34.560
<v Speaker 6>are sort of on the hook to collect it from

0:29:34.600 --> 0:29:37.120
<v Speaker 6>you and then pay into the fund. And a lot

0:29:37.160 --> 0:29:40.240
<v Speaker 6>of folks think internet companies should be doing that, they

0:29:40.280 --> 0:29:43.600
<v Speaker 6>should be carrying some of the load as well, And

0:29:44.040 --> 0:29:45.720
<v Speaker 6>that tends to be the sort of thing one might

0:29:45.760 --> 0:29:49.240
<v Speaker 6>expect the Trump administration to weigh in on and say,

0:29:49.720 --> 0:29:52.040
<v Speaker 6>you know, we want to change how the fee is

0:29:52.360 --> 0:29:55.920
<v Speaker 6>put together, rather than knocking out the fund altogether, because

0:29:56.480 --> 0:29:59.880
<v Speaker 6>as I said, it does cover an awful lot of people,

0:30:00.400 --> 0:30:03.880
<v Speaker 6>poor people, people in rural areas. A lot of them are,

0:30:04.200 --> 0:30:08.320
<v Speaker 6>frankly the folks who voted Donald Trump for president. And

0:30:08.640 --> 0:30:11.400
<v Speaker 6>it may not be top of the list of things

0:30:11.400 --> 0:30:14.560
<v Speaker 6>that the Trump administration wants to do when it starts

0:30:14.600 --> 0:30:16.880
<v Speaker 6>trying to eliminate regulations.

0:30:17.400 --> 0:30:20.440
<v Speaker 3>So the court decided not to take a case from

0:30:20.520 --> 0:30:26.160
<v Speaker 3>the tobacco industry. The tobacco industry is fighting putting these

0:30:26.440 --> 0:30:30.240
<v Speaker 3>really graphic pictures on cigarette packs.

0:30:30.800 --> 0:30:34.200
<v Speaker 6>Yes, this has been a long time coming. There's eleven

0:30:34.240 --> 0:30:36.360
<v Speaker 6>of these warnings are supposed to be on the top

0:30:36.400 --> 0:30:39.520
<v Speaker 6>half of a package of cigarette. One of them is

0:30:39.600 --> 0:30:42.520
<v Speaker 6>a woman with this baseball sized bulge in her neck

0:30:42.560 --> 0:30:45.880
<v Speaker 6>and with a thing that says warning, smoking causes head

0:30:45.920 --> 0:30:50.520
<v Speaker 6>and neck cancer. And the tobacco companies basically made the argument,

0:30:51.000 --> 0:30:53.800
<v Speaker 6>led by our Jo Reynolds, basically made the argument that

0:30:54.160 --> 0:30:57.400
<v Speaker 6>this is a free speech violation. You're compelling us to

0:30:57.920 --> 0:31:01.479
<v Speaker 6>say something we don't want to say. And in this

0:31:01.560 --> 0:31:05.240
<v Speaker 6>case a lower court federal appeals court said the Fifth

0:31:05.240 --> 0:31:09.680
<v Speaker 6>Circuit actually said, know what this is. It's akin to

0:31:10.320 --> 0:31:14.560
<v Speaker 6>regulation of deceptive advertisement. As long as the company is

0:31:14.560 --> 0:31:17.240
<v Speaker 6>only being forced to say something that is purely factual

0:31:17.280 --> 0:31:21.880
<v Speaker 6>and uncontroversial, that is okay. That phrases from a nineteen

0:31:21.920 --> 0:31:25.680
<v Speaker 6>eighty five Supreme Court decision. So the Fifth Circuit rejected

0:31:25.720 --> 0:31:28.320
<v Speaker 6>the free speech challenge. The tobacco companies turned to the

0:31:28.360 --> 0:31:31.840
<v Speaker 6>Supreme Court, and the Supreme Court said, no, we're not

0:31:31.880 --> 0:31:32.760
<v Speaker 6>going to take your case.

0:31:33.440 --> 0:31:36.880
<v Speaker 3>And I mean when I say graphic, these pictures a

0:31:36.960 --> 0:31:40.080
<v Speaker 3>lot of them are really hard to look at, which

0:31:40.160 --> 0:31:43.160
<v Speaker 3>I suppose is the point. But is there anything left

0:31:43.160 --> 0:31:45.840
<v Speaker 3>for the tobacco industry to do well?

0:31:46.800 --> 0:31:50.560
<v Speaker 6>There is, of course a new administration coming in that

0:31:50.760 --> 0:31:55.200
<v Speaker 6>is potentially one one avenue. This was something that Congress

0:31:55.240 --> 0:31:58.280
<v Speaker 6>told the FBA, the Food and Drug Administration to do

0:31:58.440 --> 0:32:01.320
<v Speaker 6>to put these sorts of advertisements together. Now, these exact

0:32:01.360 --> 0:32:04.160
<v Speaker 6>pictures that you're talking about that are so graphic, and

0:32:04.320 --> 0:32:06.480
<v Speaker 6>go to Bloomberg dot com and find find the story,

0:32:06.480 --> 0:32:09.280
<v Speaker 6>you'll see some of those, yeah images, But it is

0:32:09.280 --> 0:32:12.719
<v Speaker 6>something that Congress Commerce asked for in these very very

0:32:12.760 --> 0:32:16.200
<v Speaker 6>graphic warnings as well, very descriptive warnings about what smoking

0:32:16.280 --> 0:32:19.800
<v Speaker 6>does also the sort of thing that Congress required. So

0:32:20.120 --> 0:32:23.320
<v Speaker 6>it's possible that to really prevent this from happening, we

0:32:23.480 --> 0:32:26.520
<v Speaker 6>need new legislation. But I could certainly imagine that the

0:32:27.040 --> 0:32:28.960
<v Speaker 6>back of companies will try to get the FDA a

0:32:28.960 --> 0:32:32.160
<v Speaker 6>reverse course once the Trump presidency resumes.

0:32:32.320 --> 0:32:37.120
<v Speaker 3>So now, last Friday, the Court dismissed a case that

0:32:37.200 --> 0:32:43.040
<v Speaker 3>had been argued Facebook's appeal of the shareholder lawsuit against it.

0:32:43.440 --> 0:32:47.640
<v Speaker 6>Yeah, so this stems from the data harvesting scandal involving

0:32:47.680 --> 0:32:52.800
<v Speaker 6>the political consulting firm Cambridge Analytic, and essentially in these

0:32:52.840 --> 0:32:58.520
<v Speaker 6>shareholders are claiming that Facebook inflated share prices by misleading

0:32:58.520 --> 0:33:03.360
<v Speaker 6>shareholders about the risk that scandal would cause a misuse

0:33:03.400 --> 0:33:06.920
<v Speaker 6>of user data. And there are various points along the

0:33:06.960 --> 0:33:10.959
<v Speaker 6>timeline where the shareholders say, you knew more than you

0:33:11.120 --> 0:33:15.680
<v Speaker 6>told us. A federal appeals court fed the lawsuit against

0:33:15.720 --> 0:33:20.360
<v Speaker 6>Facebook could go forward. The Supreme Court in June agreed

0:33:20.400 --> 0:33:25.200
<v Speaker 6>to consider the appeal by Meta Meta is the new

0:33:25.280 --> 0:33:28.360
<v Speaker 6>name for Facebook hurt arguments in the case actually the

0:33:28.440 --> 0:33:32.880
<v Speaker 6>day after the election, and then for reasons that it

0:33:32.920 --> 0:33:36.320
<v Speaker 6>did not describe, decided we're not going to decide this case.

0:33:36.640 --> 0:33:38.960
<v Speaker 6>We're going to drop it. And so that is the

0:33:39.000 --> 0:33:42.120
<v Speaker 6>first quote opinion of the Supreme Court's term to not

0:33:42.280 --> 0:33:44.040
<v Speaker 6>decide this Facebook appeal.

0:33:44.360 --> 0:33:48.440
<v Speaker 3>There were also oral arguments in a sort of similar case,

0:33:49.040 --> 0:33:53.840
<v Speaker 3>an appeal by Nvidia of a shareholder's lawsuit against it.

0:33:54.240 --> 0:33:57.920
<v Speaker 3>And I'm wondering if the same thing might happen to

0:33:58.280 --> 0:34:03.000
<v Speaker 3>the Nvidia case, that they might dismiss it as improvidently granted,

0:34:03.000 --> 0:34:05.640
<v Speaker 3>because I remember that some of the justices were saying,

0:34:05.640 --> 0:34:07.120
<v Speaker 3>I don't know why we took this case.

0:34:07.680 --> 0:34:10.759
<v Speaker 6>Yeah, there were, by my account for justices who said

0:34:10.840 --> 0:34:13.680
<v Speaker 6>I don't know why we took this case. And to

0:34:13.719 --> 0:34:16.239
<v Speaker 6>be honest with you, that was what I thought we

0:34:16.239 --> 0:34:18.839
<v Speaker 6>were going to beginning on Friday instead of the Facebook case,

0:34:18.880 --> 0:34:22.520
<v Speaker 6>because oftentimes when there's an argument and a number of

0:34:22.640 --> 0:34:26.760
<v Speaker 6>justices start saying things like that, the court will dismiss

0:34:26.800 --> 0:34:30.360
<v Speaker 6>an appeal. That case is a very different issue in

0:34:30.440 --> 0:34:33.839
<v Speaker 6>terms of securities law. It's all about what kind of

0:34:33.880 --> 0:34:37.919
<v Speaker 6>specificity you need in your lawsuit, in your complaint for

0:34:38.360 --> 0:34:42.400
<v Speaker 6>a case to go forward. This is a case involving

0:34:42.800 --> 0:34:47.840
<v Speaker 6>whether the video was forthcoming enough about where its revenue

0:34:47.920 --> 0:34:51.319
<v Speaker 6>was coming from. The shareholders say, you were actually more

0:34:51.360 --> 0:34:55.720
<v Speaker 6>dependent on crypto mining revenue to being used for crypto

0:34:55.800 --> 0:34:58.759
<v Speaker 6>mining than you let on. And that's a bad thing

0:34:58.840 --> 0:35:02.719
<v Speaker 6>because everybody knows the crypto industry is very volatile, and

0:35:02.800 --> 0:35:06.239
<v Speaker 6>so crypto industry took a big dip. That meant that

0:35:06.280 --> 0:35:10.839
<v Speaker 6>in videos, shares also dipped because you eventually had to

0:35:10.960 --> 0:35:14.000
<v Speaker 6>reveal that sales were down any of that date. The

0:35:14.040 --> 0:35:17.359
<v Speaker 6>Supreme Court did suggest during arguments. As I said that

0:35:17.760 --> 0:35:21.800
<v Speaker 6>this did not present deserved broad legal issue that would

0:35:21.960 --> 0:35:24.759
<v Speaker 6>be a good candidate for a Supreme Court ruling. But

0:35:24.920 --> 0:35:27.040
<v Speaker 6>from the time being, at least, it looks like the

0:35:27.040 --> 0:35:30.040
<v Speaker 6>Court is going to go ahead and decide that case.

0:35:30.640 --> 0:35:33.320
<v Speaker 3>And in the Facebook case, back to Facebook for a minute,

0:35:33.560 --> 0:35:36.799
<v Speaker 3>there were comments that once you let the case go

0:35:37.040 --> 0:35:41.360
<v Speaker 3>forward to the discovery phase where they're exchanging documents, I

0:35:41.360 --> 0:35:44.439
<v Speaker 3>think it was just as Kavanaugh that said game over,

0:35:44.920 --> 0:35:49.680
<v Speaker 3>because then it almost forces the companies to settle the cases.

0:35:50.320 --> 0:35:52.759
<v Speaker 3>And what are the estimates of a settlement in the

0:35:52.760 --> 0:35:53.640
<v Speaker 3>Facebook case.

0:35:54.160 --> 0:35:57.839
<v Speaker 6>Matt Settenhelm, is an analyst at Bloomberg Intelligence, says that

0:35:57.880 --> 0:36:00.640
<v Speaker 6>potentially in the Facebook case, we're talking about billion with

0:36:00.760 --> 0:36:06.640
<v Speaker 6>a B dollars because the amount of the market drop

0:36:07.040 --> 0:36:10.839
<v Speaker 6>was something like two hundred billion dollars, and geralders say

0:36:11.280 --> 0:36:15.400
<v Speaker 6>that was caused in large part by these misleading disclosures,

0:36:15.600 --> 0:36:18.880
<v Speaker 6>So it is potentially a very large sum of money.

0:36:19.200 --> 0:36:21.719
<v Speaker 6>You know, Facebook is such a big company that two

0:36:21.719 --> 0:36:23.960
<v Speaker 6>billion dollars means a little less to them than it

0:36:24.000 --> 0:36:27.279
<v Speaker 6>does to you and me. But that is what you

0:36:27.440 --> 0:36:31.239
<v Speaker 6>hear all the time from the companies that yes, once

0:36:31.280 --> 0:36:33.680
<v Speaker 6>you get past that stage in litigation, once you get

0:36:33.680 --> 0:36:36.359
<v Speaker 6>to the discovery phaise, once the planks have a right

0:36:36.400 --> 0:36:40.560
<v Speaker 6>to start demanding documents and other evidence from you, that's

0:36:40.600 --> 0:36:43.800
<v Speaker 6>when litigation gets really, really expensive, and that's when companies

0:36:44.200 --> 0:36:47.360
<v Speaker 6>have a real incentive to go ahead and settle.

0:36:47.719 --> 0:36:51.000
<v Speaker 3>So we'll wait for Nvidia next. Thanks so much, Greg.

0:36:51.200 --> 0:36:55.040
<v Speaker 3>That's Bloomberg Supreme Court Reporter Greg Store and that's it

0:36:55.080 --> 0:36:57.680
<v Speaker 3>for this edition of the Bloomberg Law Show. Remember you

0:36:57.680 --> 0:37:01.239
<v Speaker 3>can always get the latest legal news on our bloom podcasts.

0:37:01.360 --> 0:37:04.399
<v Speaker 3>You can find them on Apple Podcasts, Spotify, and at

0:37:04.560 --> 0:37:09.600
<v Speaker 3>www dot Bloomberg dot com, slash podcast, Slash Law. I'm

0:37:09.640 --> 0:37:12.120
<v Speaker 3>June Grosso and you're listening to Bloomberg