WEBVTT - Trump Appeals & FTC Studies Surveillance Pricing

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<v Speaker 1>This is Bloomberg Law with June Brusso from Bloomberg Radio,

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<v Speaker 1>fresh on victories in other legal cases. Donald Trump is

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<v Speaker 1>now asking a New York appeals court to overturn the

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<v Speaker 1>nearly five hundred million dollars civil fraud judgment against him

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<v Speaker 1>after a trial. Judge Arthur and Goren found in February

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<v Speaker 1>that Trump, his company, and top executives, including his sons,

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<v Speaker 1>schemed for years to inflate his wealth on financial statements

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<v Speaker 1>used to secure loans and make deals. In the appeal,

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<v Speaker 1>Trump's lawyers called the judge's decisions legally bereft and untethered

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<v Speaker 1>to the law or to commercial reality, raising several arguments,

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<v Speaker 1>many that echoed the gripes that Trump complained about over

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<v Speaker 1>and over during the trial.

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<v Speaker 2>There were no victims because the banks made a lot

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<v Speaker 2>of money. They made one hundred million dollars and by

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<v Speaker 2>the way, I paid three hundred million dollars in taxes.

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<v Speaker 1>Joining me is Bloomberg Legal reporter Eric Larson, who has

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<v Speaker 1>been covering the New York Trump trials. Eric, before we

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<v Speaker 1>talk about the appeal, tell us about the judge's decision.

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<v Speaker 3>Sure, so this is now several months later after Trump

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<v Speaker 3>was found libel for fraud and the civil fraud case

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<v Speaker 3>brought against him by the New York Attorney General. Of course,

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<v Speaker 3>this stems from his asset valuations of all of his

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<v Speaker 3>various assets that the State of New York alleged had

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<v Speaker 3>been wildly inflated in order to get Trump better terms

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<v Speaker 3>on loans from banks for over a decade. And so

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<v Speaker 3>the state won this trial. It was a non jury trial,

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<v Speaker 3>and in that time, of course, the former president had

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<v Speaker 3>vowed to appeal, and this was his appeal brief filed

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<v Speaker 3>with an intermediate appeals court, which really spelled out his

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<v Speaker 3>case for trying to overturn the verdict and the five

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<v Speaker 3>hundred and fifty four million dollar penalty last him.

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<v Speaker 1>He raises a lot of arguments here, one being that

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<v Speaker 1>there were no victims and no losses right.

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<v Speaker 3>That is one of the top arguments that Trump makes

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<v Speaker 3>in this filing. He argues that the New York Attorney General,

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<v Speaker 3>Letitia James, didn't have any right to bring this case

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<v Speaker 3>under the New York executive law, in part because there

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<v Speaker 3>were no victims. This is a consumer fraud type case.

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<v Speaker 3>They're saying, where are the victims? Where are the consumers

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<v Speaker 3>who are hurt by this. Of course, we will get

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<v Speaker 3>a full response from the Attorney General to this argument

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<v Speaker 3>and others in the brief, but she has previously responded

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<v Speaker 3>to this, and I should note that all of these

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<v Speaker 3>arguments in this brief have sort of been made before

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<v Speaker 3>by Trump. But the Attorney General says that she had

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<v Speaker 3>a right to sue because it's up to the state

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<v Speaker 3>to make sure that documents used in financial transactions, like

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<v Speaker 3>the loan documents at issue in this case, have to

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<v Speaker 3>be accurate and they can't knowingly contain false information. So

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<v Speaker 3>while the banks didn't come out and say, hey, we

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<v Speaker 3>were defrauded here, the idea for Leticia James is is

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<v Speaker 3>that you have to prevent future violations by other individuals

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<v Speaker 3>and companies by showing that they do enforce the law

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<v Speaker 3>here when there's obvious violations according to the state.

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<v Speaker 1>And we have heard this point since the very beginning

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<v Speaker 1>that the Attorney General is politically motivated.

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<v Speaker 3>Right, So that's another one of the arguments spelled out

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<v Speaker 3>in this brief. They say that the only reason that

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<v Speaker 3>Leticia James brought this case is because she campaigned as

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<v Speaker 3>a Democrat on going after Trump, and that she had

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<v Speaker 3>promised to do that, And in a sense, Trump is

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<v Speaker 3>arguing here that this entire investigation and the lawsuit was

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<v Speaker 3>sort of pretextual, that she had to come up with

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<v Speaker 3>something in order to please the voters who voted for her.

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<v Speaker 3>As with some of the other arguments, you know, Trump

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<v Speaker 3>made this argument repeatedly before this ever went to trial,

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<v Speaker 3>and the judge shot that down repeatedly and allowed the

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<v Speaker 3>case to go to trial. So that's kind of kind

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<v Speaker 3>of a tough one there for Trump to be because

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<v Speaker 3>I believe the appeals court has already kind of heard

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<v Speaker 3>this argument before as well.

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<v Speaker 1>Yes, they heard a lot of these arguments, because Trump's

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<v Speaker 1>lawyers went to the Appellate Division at least ten times

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<v Speaker 1>to challenge the judge's rulings, including during the trial. Most

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<v Speaker 1>of those appeals were, of course unsuccessful. And yet another

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<v Speaker 1>argument that has resurfaced was based on the Statute of limitations.

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<v Speaker 3>Right. So Trump makes a big point in this filing

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<v Speaker 3>of saying that the last time the appeals court heard

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<v Speaker 3>this case, I believe it was when the motion to

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<v Speaker 3>dismiss was denied and the appeals court reviewed that decision.

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<v Speaker 3>It reversed the judge, the trial judge on a few things. First,

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<v Speaker 3>it granted dismissal for Ivanka Trump. Of course left the

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<v Speaker 3>claims pending against Donald Trump and his two sons, Don

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<v Speaker 3>Junior and Eric Trump. But they did reverse on Ivanka

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<v Speaker 3>Trump in part because of the statute of limitations, and

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<v Speaker 3>the court said, you can't go as far back as

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<v Speaker 3>you wanted to in looking at these documents, these transactions.

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<v Speaker 3>So the appeals court didn't say exactly what the trial

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<v Speaker 3>judge had to do with that information and left it

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<v Speaker 3>to the judge to sort of decide himself what to

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<v Speaker 3>do with it. And the judge, Arthur Engron, decided that

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<v Speaker 3>even with that statute of limitations determination, that the older

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<v Speaker 3>documents that were too old had been used repeatedly as

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<v Speaker 3>the years went on to verify Trump's finances and the

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<v Speaker 3>company's finances as the loans continued. So that's how he

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<v Speaker 3>kept the claims alive to go to trial. And Trump

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<v Speaker 3>argues in this document that he never should have done

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<v Speaker 3>that and claims that the judge, you know, just ignored

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<v Speaker 3>the appeals court order for no apparent reason. So that's

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<v Speaker 3>kind of what that part of the argument boils down to.

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<v Speaker 1>They're also questioning the size of the judgment, calling it

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<v Speaker 1>disproportionate and saying that it violates state and US constitutional

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<v Speaker 1>guarantees against excessive punishments.

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<v Speaker 3>Right, So this seems like a little bit more of

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<v Speaker 3>a typical type of thing he might see in an

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<v Speaker 3>appeal where a huge judgment is going to be scrutinized

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<v Speaker 3>by an appeals court and they're going to look at

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<v Speaker 3>whether or not the Attorney General calculated these damages correctly.

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<v Speaker 3>Of course, a lot of that includes interest. So we

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<v Speaker 3>saw a lot of arguments back and forth between the

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<v Speaker 3>parties just leading up to the final award being handed down,

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<v Speaker 3>and the Attorney General is confidence. She says she's confident

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<v Speaker 3>that they calculated all of this correctly. They're clawing back

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<v Speaker 3>what they say was the profit that Trump made off

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<v Speaker 3>of two deals in particular, including the old post office,

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<v Speaker 3>that luxury hotel in DC, and also saying that if

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<v Speaker 3>they hadn't had that money, that profit in Trump's bank account,

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<v Speaker 3>then he wouldn't have been able to do additional deals.

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<v Speaker 3>So they're sort of like clawing back what they say

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<v Speaker 3>was an illegal profit or an improper profit that Trump

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<v Speaker 3>got by lying about the value of his assets and

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<v Speaker 3>getting a better terms on his loans, and then, of course,

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<v Speaker 3>as I said, a lot of that is interest as well.

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<v Speaker 3>So I'm sure we'll see the appeals court scrutinize this

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<v Speaker 3>a lot and perhaps come up with a different poculation.

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<v Speaker 3>But you know, who knows at this point.

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<v Speaker 1>Now, there are some things that you don't normally see

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<v Speaker 1>in appeals Reef sounds sort of like campaigning or Trump

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<v Speaker 1>outside the courthouse that the verdict would be a disaster

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<v Speaker 1>for New York as businesses flee from an attorney general

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<v Speaker 1>targeting victimless transactions, and also talking about him as among

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<v Speaker 1>the most visionary and iconic real estate developers in American history.

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<v Speaker 1>Was there a lot of fluff? I'll call it fluff.

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<v Speaker 3>Well, yes, you could probably call it that, because I

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<v Speaker 3>don't I don't know that the appeals court judges care

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<v Speaker 3>about that in terms of determining whether or not this

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<v Speaker 3>was all correctly done here. But actually that did form

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<v Speaker 3>a big part of the defense case. At trial, his

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<v Speaker 3>lawyers put on a big presentation, you know, a PowerPoint

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<v Speaker 3>looking presentation that went on for quite some time, detailing

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<v Speaker 3>essentially every deal that Trump had ever done, starting from

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<v Speaker 3>the beginning of his career up to the you know,

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<v Speaker 3>the old post office in DC, and you know, putting

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<v Speaker 3>it in these these terms of him being such an

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<v Speaker 3>impressive real estate businessman. But then also they say this

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<v Speaker 3>to make the point that the banks that did business

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<v Speaker 3>with him were eager to do business with him, that

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<v Speaker 3>he was seen as visionary by these lenders that fought

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<v Speaker 3>for his business, and they did put up that kind

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<v Speaker 3>of testimony during the trial to show to make the

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<v Speaker 3>point again, as we said earlier, about there not being

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<v Speaker 3>any victims. So yeah, I mean, it's sort of inevitable

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<v Speaker 3>that you see stuff like that pop up in Trump's filings.

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<v Speaker 3>But I noticed that when he said that, you know,

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<v Speaker 3>businesses were fleeing New York as a result of Letitia

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<v Speaker 3>James's enforcement of this law, that there was no footnote there.

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<v Speaker 3>It didn't lead to any examples of other businesses that

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<v Speaker 3>were fleeing the state as a result of this case

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<v Speaker 3>and this trial. And I remember that after the verdict

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<v Speaker 3>was handed down, Trump had a press conference in which

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<v Speaker 3>he's said that Exxon Mobile had fled New York as

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<v Speaker 3>a result of a lawsuit brought by the New York

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<v Speaker 3>Attorney General, a case that actually the Attorney General lost,

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<v Speaker 3>but at any rate. He said that that excellent had

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<v Speaker 3>fled and that's that's actually just not true.

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<v Speaker 1>Trump had a problem coming up with the cash or

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<v Speaker 1>the money for the appealed bond. Remind us what happened there.

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<v Speaker 3>Yeah, So in order to put that judgment on hold

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<v Speaker 3>during his appeal, he had to put up an appeal

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<v Speaker 3>bond about one hundred and seventy five million dollars. Initially,

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<v Speaker 3>the state wanted an appeal bond of the full amounts

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<v Speaker 3>and plus i think an extra twenty percent, which they

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<v Speaker 3>said that they were entitled to because Trump couldn't be

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<v Speaker 3>trusted to pay up if his appeal failed. But the

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<v Speaker 3>courts did not agree and lowered the size of the

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<v Speaker 3>appeal bond. And of course Trump was able to do

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<v Speaker 3>that by finding a company that provides these bonds based

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<v Speaker 3>out of California, that a Trump supporter essentially owns the

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<v Speaker 3>company and agreed to do that for him. There was

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<v Speaker 3>still some contention between the parties over whether or not

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<v Speaker 3>that company could pay up if necessary, but for all

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<v Speaker 3>intents and purposes that that debate was sort of put

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<v Speaker 3>to rest and the judgment is on hold. Trump's assets

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<v Speaker 3>were not seized, as the Attorney General is threatening to

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<v Speaker 3>do if he didn't pay up. So that bit of

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<v Speaker 3>drama is over, and now it's sort of turning to

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<v Speaker 3>the actual appeals court case, which itself could potentially drag

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<v Speaker 3>on for quite some time.

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<v Speaker 1>Eric Trump's sentencing for his conviction in the hush money

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<v Speaker 1>case has been put off because he's asking the judge

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<v Speaker 1>to toss out his conviction due to the controversial Supreme

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<v Speaker 1>Court opinion on presidential immunity. Where does that stand?

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<v Speaker 3>So, of course, Trump lost his first criminal trial here

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<v Speaker 3>in New York, the so called hush money case over

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<v Speaker 3>the falsified records that hid his hush money payment to

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<v Speaker 3>porn star Stormy Daniels. And even though that verdict was

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<v Speaker 3>handed down by a jury before this Supreme Court's immunity ruling,

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<v Speaker 3>Trump has circled back and said, hey, this has to

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<v Speaker 3>be tossed out. He has asked the judge to do so,

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<v Speaker 3>and the Manhattan District Attorney, Alvin Bragg is to file

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<v Speaker 3>his response to that request today. We may not necessarily

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<v Speaker 3>see it right away today, but we can expect that

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<v Speaker 3>the prosecutors are going to urge the court to uphold

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<v Speaker 3>the verdicts and say, hey, even though some of this

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<v Speaker 3>evidence in testimony potentially could be impacted by the immunity

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<v Speaker 3>ruling from the Supreme Court. All of the other evidence

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<v Speaker 3>in testimony in the case justify this verdict. I think

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<v Speaker 3>that's probably what we can expect to hear from the

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<v Speaker 3>district attorney.

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<v Speaker 1>Thanks so much for coming on the show.

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<v Speaker 3>Eric.

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<v Speaker 1>That's Bloomberg Legal reporter Eric Larson coming up next on

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<v Speaker 1>the Bloomberg Lawn Show. The fallout continues in the Alaska

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<v Speaker 1>judge scandal. Just how many cases might be reversed. I'm

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<v Speaker 1>June Grosso and you're listening to Bloomberg. Federal prosecutors in

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<v Speaker 1>Alaska have identified nearly two dozen criminal cases with potentially

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<v Speaker 1>undisclosed conflicts of interest involving former federal judge Joshua Kindred

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<v Speaker 1>and the attorneys who worked on cases before him. The

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<v Speaker 1>Trump appointee resigned this month amid allegation of sexual misconduct.

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<v Speaker 1>A judiciary investigation found that Kindred had an inappropriate relationship

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<v Speaker 1>with a female clerk who later worked for the US

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<v Speaker 1>Attorney's office in Alaska. The battle also found the judge

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<v Speaker 1>created a hostile work environment, including by discussing his romantic

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<v Speaker 1>life in the workplace and lied about his conduct to

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<v Speaker 1>judiciary officials conducting the inquiry. The Federal Public Defender's Office

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<v Speaker 1>is undertaking its own review. Federal Defender Jamie McGrady has

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<v Speaker 1>said she believes the number of potentially conflicted cases is

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<v Speaker 1>higher than the twenty three identified by prosecutors. The inquiry

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<v Speaker 1>could lead to the reopening of multiple criminal cases that

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<v Speaker 1>came before Kindred during his more than four years on

0:12:44.440 --> 0:12:47.960
<v Speaker 1>the bench. Joining me is Abby Smith, director of Georgetown

0:12:48.040 --> 0:12:52.600
<v Speaker 1>Law's Criminal Defense and Prisoner Advocacy Clinic. The US Attorney

0:12:52.760 --> 0:12:56.280
<v Speaker 1>is conducting an investigation. The Federal Public Defender is conducting

0:12:56.280 --> 0:13:00.480
<v Speaker 1>an investigation to identify potential conflicts of interest. Would it

0:13:00.520 --> 0:13:03.880
<v Speaker 1>be any case in which the judge had a relationship

0:13:04.080 --> 0:13:06.520
<v Speaker 1>with the attorney? Would it be more than that?

0:13:07.360 --> 0:13:11.679
<v Speaker 4>Well, any investigation would start with the judge having a

0:13:11.720 --> 0:13:15.400
<v Speaker 4>relationship with a prosecutor in an ongoing case in which

0:13:15.440 --> 0:13:20.440
<v Speaker 4>the prosecutor is one of counsel. That needed to have

0:13:20.480 --> 0:13:25.040
<v Speaker 4>been disclosed at the very least, and it was you know,

0:13:25.200 --> 0:13:29.520
<v Speaker 4>up to either side could have asked for recusal or disqualification.

0:13:29.960 --> 0:13:32.520
<v Speaker 4>But I think this case goes beyond that. I mean,

0:13:32.559 --> 0:13:36.120
<v Speaker 4>it sounds like there is a pattern of misbehavior on

0:13:36.160 --> 0:13:40.319
<v Speaker 4>the part of the judge that some would or you

0:13:40.400 --> 0:13:44.040
<v Speaker 4>made him an unfit judge while he was presiding over

0:13:44.120 --> 0:13:48.360
<v Speaker 4>cases period. You know, the case that came to mind

0:13:48.880 --> 0:13:52.160
<v Speaker 4>for me when I read about what's happening in Alaska

0:13:52.480 --> 0:13:55.240
<v Speaker 4>is it's a little different, but it led to the

0:13:55.360 --> 0:14:00.240
<v Speaker 4>dismissal of several dozen cases. It involved a judge who

0:14:00.400 --> 0:14:05.480
<v Speaker 4>had been confronted by the FBI for having taken bribes

0:14:05.640 --> 0:14:10.360
<v Speaker 4>from a leading union in Philadelphia, and they offered her

0:14:10.400 --> 0:14:14.839
<v Speaker 4>a chance to be an informant to earn some mitigation

0:14:15.320 --> 0:14:19.200
<v Speaker 4>and you know, perhaps non prosecution. Anyhow, she wore a

0:14:19.200 --> 0:14:21.560
<v Speaker 4>wire and proceeded to start talking to a bunch of

0:14:21.600 --> 0:14:24.920
<v Speaker 4>other judges as she's a sitting judge presiding over cases

0:14:25.480 --> 0:14:28.680
<v Speaker 4>and basically in the pocket of the FBI, and with

0:14:28.760 --> 0:14:32.680
<v Speaker 4>a deep need to ingratiate herself with the government so

0:14:32.760 --> 0:14:37.120
<v Speaker 4>that she not be prosecuted. So she was wearing many hats.

0:14:37.160 --> 0:14:40.120
<v Speaker 4>And the challenge to all of the cases that she

0:14:40.400 --> 0:14:43.080
<v Speaker 4>ruled upon during that time period was a couple of things.

0:14:43.120 --> 0:14:46.440
<v Speaker 4>As you know, broadly, a problem under the due process

0:14:46.440 --> 0:14:50.800
<v Speaker 4>clause of the US Constitution is this good and fair behavior.

0:14:50.960 --> 0:14:54.040
<v Speaker 4>There were also questions about separation of powers. Can you

0:14:54.080 --> 0:14:58.080
<v Speaker 4>be both a judge and essentially a prosecutorial agent at

0:14:58.120 --> 0:15:01.760
<v Speaker 4>the same time. You know, the idea that she was

0:15:01.880 --> 0:15:04.200
<v Speaker 4>attempting to curry favor, that is, she needed to be

0:15:04.240 --> 0:15:07.640
<v Speaker 4>the best informant she could be meant that some of

0:15:07.680 --> 0:15:10.720
<v Speaker 4>that was going to go down hard on the defendants

0:15:10.760 --> 0:15:13.680
<v Speaker 4>appearing before, so she would be more and more appealing

0:15:13.920 --> 0:15:17.600
<v Speaker 4>to the prosecution. So here's this judge in Alaska who,

0:15:17.880 --> 0:15:20.800
<v Speaker 4>according to what I've read, and one of the more

0:15:20.840 --> 0:15:23.000
<v Speaker 4>troubling aspects of the case is that he was found

0:15:23.040 --> 0:15:27.880
<v Speaker 4>to applied to the higher court investigating him, that he

0:15:27.920 --> 0:15:31.880
<v Speaker 4>had engaged in widespread misconduct, you know, an improper relationship

0:15:32.200 --> 0:15:37.400
<v Speaker 4>with one currently employed prosecutor and being wildly inappropriate, engaging

0:15:37.400 --> 0:15:41.240
<v Speaker 4>in what probably would be hostile workplace environment behavior, maybe

0:15:41.280 --> 0:15:45.040
<v Speaker 4>sexual harassment with others. You know, I'm interested in whether

0:15:45.080 --> 0:15:48.239
<v Speaker 4>there could be a challenge as to general unfitness.

0:15:48.920 --> 0:15:51.960
<v Speaker 1>Is it a no brainer that those cases involving the

0:15:52.040 --> 0:15:55.440
<v Speaker 1>prosecutor he was having the sexual relationship with, or the

0:15:55.480 --> 0:15:58.400
<v Speaker 1>one who sent him the nude photos, will those cases

0:15:58.520 --> 0:16:00.640
<v Speaker 1>easily be reversed?

0:16:01.160 --> 0:16:03.000
<v Speaker 4>Yes, it seems to be. That's the that's the low

0:16:03.040 --> 0:16:06.440
<v Speaker 4>hanging fruit. That should be pretty easy. But the question

0:16:06.560 --> 0:16:10.160
<v Speaker 4>is who's going to start that process. So, just to

0:16:10.200 --> 0:16:14.800
<v Speaker 4>give you the defense perspective, depends. You know, quite often

0:16:15.000 --> 0:16:18.920
<v Speaker 4>it's useful to challenge any and all convictions because it's

0:16:18.960 --> 0:16:21.680
<v Speaker 4>harder to prove a case the more time goes by.

0:16:21.920 --> 0:16:25.760
<v Speaker 4>So arguably there's some strategic advantage and kind of always

0:16:25.800 --> 0:16:27.440
<v Speaker 4>if you get a second bite of the apple, to

0:16:27.480 --> 0:16:30.200
<v Speaker 4>go for it. On the other hand, I don't know.

0:16:30.600 --> 0:16:33.640
<v Speaker 4>You know, maybe this judge was a fairly lenient sentence,

0:16:33.680 --> 0:16:36.760
<v Speaker 4>or maybe you know, there was a plea before him,

0:16:36.760 --> 0:16:39.400
<v Speaker 4>and a better that the defendant be sentenced by this judge,

0:16:39.400 --> 0:16:43.160
<v Speaker 4>no matter how corrupt or bizarre his behavior, than the

0:16:43.240 --> 0:16:45.760
<v Speaker 4>luck of the draw the next time around. So you know,

0:16:45.920 --> 0:16:49.280
<v Speaker 4>I guess question number one will be who brings the challenge?

0:16:49.360 --> 0:16:53.600
<v Speaker 4>Will the federal defenders seek to undo every conviction that

0:16:53.680 --> 0:16:56.760
<v Speaker 4>came before this judge? Will the prosecution, which has an

0:16:56.800 --> 0:17:01.240
<v Speaker 4>ethical responsibility to do justice, will they, on their own accord,

0:17:01.680 --> 0:17:05.280
<v Speaker 4>you know, move to dismiss those cases or somehow seeks

0:17:05.400 --> 0:17:08.400
<v Speaker 4>the ability to not prost those cases after the fact.

0:17:08.440 --> 0:17:10.240
<v Speaker 4>I don't know, and I don't want to paint this

0:17:10.359 --> 0:17:15.760
<v Speaker 4>too broadly, because Alaska's a relatively small jurisdiction as jurisdictions go,

0:17:16.240 --> 0:17:19.440
<v Speaker 4>and you know, the people tend to know each other

0:17:19.520 --> 0:17:22.280
<v Speaker 4>in courthouses, the criminal bar tends to know each other.

0:17:22.359 --> 0:17:24.960
<v Speaker 4>It's not unheard of that a judge is married to

0:17:25.000 --> 0:17:28.400
<v Speaker 4>a prosecutor, or to a defense lawyer, or a prosecutor

0:17:28.440 --> 0:17:31.800
<v Speaker 4>is married to a defense lawyer, because that's the society

0:17:31.880 --> 0:17:35.760
<v Speaker 4>they keep. But it needs to be disclosed, and the

0:17:35.840 --> 0:17:38.600
<v Speaker 4>prudent course would be to not have that person appear

0:17:38.640 --> 0:17:41.200
<v Speaker 4>before you ever if you're married to them. You know,

0:17:41.240 --> 0:17:44.120
<v Speaker 4>I'm not saying that like it doesn't happen. I don't

0:17:44.160 --> 0:17:46.680
<v Speaker 4>need to sound like a Pollyanna about it. But it's

0:17:46.720 --> 0:17:49.359
<v Speaker 4>just that there needs to be disclosure, and the people

0:17:49.400 --> 0:17:53.720
<v Speaker 4>involved need to be wise about ensuring fairness to other people,

0:17:53.720 --> 0:17:56.400
<v Speaker 4>including to the public, because that's the thing about judges

0:17:56.600 --> 0:18:01.119
<v Speaker 4>and prosecutors. Appearance of proprieties the most important thing, because

0:18:01.119 --> 0:18:03.800
<v Speaker 4>that has to do with people regarding the system as legitimate.

0:18:03.960 --> 0:18:06.920
<v Speaker 1>I mean, it seems like the US Attorney's office could

0:18:06.960 --> 0:18:09.560
<v Speaker 1>also be at faull Tier. Yes, three of the lawyers

0:18:09.600 --> 0:18:13.439
<v Speaker 1>were from that office, and apparently the office was aware

0:18:13.520 --> 0:18:15.119
<v Speaker 1>of a conflict.

0:18:14.960 --> 0:18:18.000
<v Speaker 4>Yes, they should have disclosed. They should have said on

0:18:18.160 --> 0:18:20.760
<v Speaker 4>the record so the events could at least consider it

0:18:21.240 --> 0:18:23.400
<v Speaker 4>and want to reveal for the record that or disclosed

0:18:23.440 --> 0:18:25.880
<v Speaker 4>for the record that you know. I have a colleague

0:18:25.880 --> 0:18:28.720
<v Speaker 4>who's currently involved in a relationship with a judge. Here's

0:18:28.760 --> 0:18:32.040
<v Speaker 4>what happens pretty commonly, and I just don't understand why

0:18:32.040 --> 0:18:35.960
<v Speaker 4>this is a problem, because it's so ordinary for judges

0:18:36.119 --> 0:18:39.639
<v Speaker 4>who've had law clerks who then either join the local

0:18:39.720 --> 0:18:43.399
<v Speaker 4>prosecutor's office or the local public defender office or haines

0:18:43.480 --> 0:18:46.720
<v Speaker 4>a shingle. It's usually an arrangement where that judge doesn't

0:18:47.119 --> 0:18:50.600
<v Speaker 4>take cases involving that lawyer who was so recently a

0:18:50.680 --> 0:18:54.280
<v Speaker 4>judge's clerk. Now, depending upon the size of the jurisdiction

0:18:54.480 --> 0:18:58.119
<v Speaker 4>and the years that go by, that could change. But

0:18:58.200 --> 0:19:00.640
<v Speaker 4>I think that's the kind of prudent thing to do.

0:19:01.320 --> 0:19:04.560
<v Speaker 4>And if the judge forgets, then the lawyer should you

0:19:04.760 --> 0:19:07.920
<v Speaker 4>reveal that that's the relationship. It's a little trickier when

0:19:07.960 --> 0:19:11.679
<v Speaker 4>you're defense counsel because defense because our ethical obligation is

0:19:11.680 --> 0:19:14.720
<v Speaker 4>to pursue our client's interests, and there's no ethical rule

0:19:14.800 --> 0:19:17.399
<v Speaker 4>that says you have to disclose that you had some

0:19:17.560 --> 0:19:20.359
<v Speaker 4>sort of relationships with a judge, you know. I mean,

0:19:20.400 --> 0:19:22.520
<v Speaker 4>there are some rules that have to do with what

0:19:22.680 --> 0:19:28.720
<v Speaker 4>proper relationships you know, exist between lawyer and client. But frankly,

0:19:28.840 --> 0:19:31.240
<v Speaker 4>the ethical rules don't have a whole lot to say

0:19:31.280 --> 0:19:35.640
<v Speaker 4>about relationships among lawyers or judges. But the US Attorney's

0:19:35.680 --> 0:19:38.240
<v Speaker 4>office should have disclosed and the judge should have disclosed

0:19:38.960 --> 0:19:39.760
<v Speaker 4>apparently period.

0:19:40.000 --> 0:19:42.240
<v Speaker 1>One of the attorneys of the potential conflict is a

0:19:42.280 --> 0:19:43.360
<v Speaker 1>defense lawyer.

0:19:44.600 --> 0:19:47.000
<v Speaker 4>Well, that, you know, the judge needed to have disclosed.

0:19:47.520 --> 0:19:49.600
<v Speaker 4>So do you understand what I'm saying about The defense

0:19:49.680 --> 0:19:52.760
<v Speaker 4>is in a really different position. I'm not gonna you know,

0:19:52.800 --> 0:19:55.280
<v Speaker 4>I might have a I might have a counseling session

0:19:55.280 --> 0:19:58.720
<v Speaker 4>with my client where I say, look, I have this,

0:19:58.880 --> 0:20:01.919
<v Speaker 4>you know, particular relationtionship with this judge. I want you

0:20:02.000 --> 0:20:06.119
<v Speaker 4>to know that, and if you're uncomfortable with that, you know,

0:20:06.200 --> 0:20:09.240
<v Speaker 4>let's talk. That's true. I mean, you might have a conversation,

0:20:09.400 --> 0:20:12.120
<v Speaker 4>and you probably should have a conversation with your clients.

0:20:12.160 --> 0:20:17.920
<v Speaker 4>But defense lawyer doesn't have to disclose having any sort

0:20:17.960 --> 0:20:21.919
<v Speaker 4>of social relationship with a judge. That would be for

0:20:21.960 --> 0:20:25.520
<v Speaker 4>the judge to do unless the lawyer does that, because

0:20:25.520 --> 0:20:28.720
<v Speaker 4>it serves the client's interest. I mean, I've had judges say,

0:20:28.960 --> 0:20:31.359
<v Speaker 4>you know, I'm a law professor who else appears in court.

0:20:32.080 --> 0:20:35.760
<v Speaker 4>One time, I was at some very large fundraising event

0:20:36.200 --> 0:20:39.280
<v Speaker 4>in Washington, d C. There are probably several hundred people there,

0:20:39.280 --> 0:20:42.320
<v Speaker 4>and I ran into a judge who I sometimes appear before.

0:20:42.600 --> 0:20:45.639
<v Speaker 4>I'm not friends with this judge. I've never socialized with

0:20:45.720 --> 0:20:49.639
<v Speaker 4>this judge. I wouldn't even characterize our contact at the

0:20:49.680 --> 0:20:53.200
<v Speaker 4>event as having a drink together. It didn't go that far.

0:20:53.359 --> 0:20:56.240
<v Speaker 4>It's more like a little small suck. Then the next

0:20:56.240 --> 0:20:58.119
<v Speaker 4>time I appear in court, the judges, I, you know,

0:20:58.160 --> 0:21:02.040
<v Speaker 4>I feel compelled to disclose that that Miss Smith and I,

0:21:02.400 --> 0:21:05.240
<v Speaker 4>you know, are are social acquaintances or something. And I thought,

0:21:05.359 --> 0:21:08.240
<v Speaker 4>oh my god, it's going to hurt my reputation. I'm

0:21:08.280 --> 0:21:11.240
<v Speaker 4>not good friends with this judge, trust me. But no

0:21:11.440 --> 0:21:14.520
<v Speaker 4>judges do that. And I think careful judges would err

0:21:14.520 --> 0:21:17.600
<v Speaker 4>on the side of overdisclosure and let the party stuff

0:21:17.680 --> 0:21:19.840
<v Speaker 4>it out. But I can't believe this judge was keeping

0:21:19.880 --> 0:21:22.720
<v Speaker 4>it secret. And if the US Attorney's office knew, that's

0:21:22.880 --> 0:21:26.239
<v Speaker 4>really bad for him. I'm sure that smart people in

0:21:26.280 --> 0:21:29.199
<v Speaker 4>the local federal defender are thinking of all kinds of

0:21:29.280 --> 0:21:32.560
<v Speaker 4>creative motions to get a second crack in some of

0:21:32.560 --> 0:21:35.639
<v Speaker 4>those cases that were decided by that US Attorney's office

0:21:35.640 --> 0:21:36.480
<v Speaker 4>and that judge.

0:21:36.720 --> 0:21:38.639
<v Speaker 1>Do you think that it will take years for this

0:21:38.800 --> 0:21:41.920
<v Speaker 1>to unwind all the repercussions.

0:21:42.320 --> 0:21:45.200
<v Speaker 4>I don't know, because I betshit things move more quickly

0:21:45.240 --> 0:21:48.520
<v Speaker 4>in Alaska. I don't think the docket is his. If

0:21:48.520 --> 0:21:51.600
<v Speaker 4>this was, you know, the Southern District of New York,

0:21:51.880 --> 0:21:54.479
<v Speaker 4>then I would say could take a long time. But

0:21:54.560 --> 0:21:56.520
<v Speaker 4>I'm not sure it will take that long a time.

0:21:56.920 --> 0:22:01.600
<v Speaker 4>It's really interesting that the judge was not very few judges,

0:22:01.720 --> 0:22:04.560
<v Speaker 4>especially so junior and their tenure, would give up a

0:22:04.600 --> 0:22:08.320
<v Speaker 4>lifetime appointment. There must be dirt there. So you know,

0:22:08.520 --> 0:22:11.879
<v Speaker 4>I think investigation is wise. We may only have the

0:22:11.880 --> 0:22:12.800
<v Speaker 4>tip of the icebergs.

0:22:13.119 --> 0:22:16.280
<v Speaker 1>Let's say you're a defense lawyer looking at this. Your

0:22:16.280 --> 0:22:20.000
<v Speaker 1>client had a case before this judge involving the prosecutor,

0:22:20.200 --> 0:22:23.280
<v Speaker 1>but your client got a light sentence. How do you

0:22:23.400 --> 0:22:26.399
<v Speaker 1>weigh whether to retry the case. I mean, that seems

0:22:26.400 --> 0:22:27.560
<v Speaker 1>like it's a tough decision.

0:22:28.200 --> 0:22:30.840
<v Speaker 4>It is. That's a really good question. I would go

0:22:30.880 --> 0:22:32.960
<v Speaker 4>out and see the client say, look, all hell is

0:22:33.000 --> 0:22:36.040
<v Speaker 4>broken loose. This judge is now resigned, you know, under

0:22:36.080 --> 0:22:41.159
<v Speaker 4>a cloud, and we may have an opportunity to seek

0:22:41.200 --> 0:22:46.880
<v Speaker 4>to revisit your case to maybe get the conviction set

0:22:46.920 --> 0:22:50.560
<v Speaker 4>aside and or get you resentenced. But let's think about this.

0:22:51.119 --> 0:22:53.479
<v Speaker 4>Let's look at the other judges that you could appear

0:22:53.520 --> 0:22:57.320
<v Speaker 4>before for sentencing. Here's the sentence you got. Is it

0:22:57.400 --> 0:22:59.840
<v Speaker 4>worth the risk? Is this what you want to do?

0:23:00.119 --> 0:23:03.800
<v Speaker 4>Or should we consider ourselves having cut our losses. That's

0:23:03.800 --> 0:23:06.080
<v Speaker 4>the kind of discussion any good defense lawyer would have

0:23:06.520 --> 0:23:10.280
<v Speaker 4>that even though in the initial moment of kind of

0:23:10.880 --> 0:23:16.000
<v Speaker 4>surprise and maybe even hilarity about a judge, you know,

0:23:16.160 --> 0:23:18.639
<v Speaker 4>blowing up the way this one did. You know, you

0:23:18.720 --> 0:23:21.320
<v Speaker 4>may want to say, oh, let's bring every single case,

0:23:21.480 --> 0:23:24.639
<v Speaker 4>but you know, let's challenge every single case that this

0:23:24.760 --> 0:23:27.159
<v Speaker 4>judge had a hand in. Might not be good for

0:23:27.200 --> 0:23:29.399
<v Speaker 4>the client. You got to take each case individually.

0:23:30.040 --> 0:23:32.720
<v Speaker 1>It's really interesting seeing it from the defense point of view.

0:23:32.920 --> 0:23:37.080
<v Speaker 1>Thanks so much, Abby. That's Abby Smith, director of Georgetown Laws,

0:23:37.119 --> 0:23:41.320
<v Speaker 1>Criminal Defense and Prisoner Advocacy Clinic. Coming up next on

0:23:41.320 --> 0:23:44.640
<v Speaker 1>The Bloomberg Lawn Show, the Federal Trade Commission is looking

0:23:44.720 --> 0:23:49.000
<v Speaker 1>into what it calls the opaque market of surveillance pricing,

0:23:49.400 --> 0:23:53.560
<v Speaker 1>using consumer data to charge different customers different prices for

0:23:53.640 --> 0:23:56.800
<v Speaker 1>the same goods. I'm June Grasso, and this is Bloomberg.

0:23:58.359 --> 0:24:03.960
<v Speaker 1>Federal regulators are examined how companies including MasterCard, JP, Morgan Chase,

0:24:04.320 --> 0:24:09.400
<v Speaker 1>and McKinsey provide clients with algorithms that use consumers personal

0:24:09.520 --> 0:24:14.040
<v Speaker 1>data to set prices based on a shopper's individual characteristics.

0:24:14.200 --> 0:24:16.800
<v Speaker 1>The Federal Trade Commission said it was seeking to better

0:24:16.920 --> 0:24:22.440
<v Speaker 1>understand the opaque market of surveillance pricing practices using consumer

0:24:22.560 --> 0:24:27.359
<v Speaker 1>data including credit information, location, and browsing history, to charge

0:24:27.400 --> 0:24:31.600
<v Speaker 1>different customers different prices for the same goods. To do this,

0:24:31.760 --> 0:24:36.680
<v Speaker 1>the agency noted third party intermediaries claimed to use advanced algorithms,

0:24:37.000 --> 0:24:42.080
<v Speaker 1>artificial intelligence and other technology. FTC chair Lina Khan said,

0:24:42.359 --> 0:24:46.960
<v Speaker 1>quote firms that harvest Americans' personal data can't put people's

0:24:47.000 --> 0:24:50.760
<v Speaker 1>privacy at risk. Now, firms could be exploiting this vast

0:24:50.800 --> 0:24:55.359
<v Speaker 1>trove of personal information to charge people higher prices. Joining

0:24:55.400 --> 0:25:00.600
<v Speaker 1>me is Bloomberg? Anti trust reporter Leah Nylan exactly is

0:25:00.680 --> 0:25:02.159
<v Speaker 1>surveillance pricing?

0:25:02.840 --> 0:25:05.600
<v Speaker 5>Surveillance pricing is something that goes under a lot of

0:25:05.600 --> 0:25:10.320
<v Speaker 5>different names. Sometimes people call it price discrimination. Sometimes they

0:25:10.359 --> 0:25:14.800
<v Speaker 5>call it online pricing, dynamic pricing, a couple different things. Essentially,

0:25:14.800 --> 0:25:17.399
<v Speaker 5>the idea is that the price isn't one thing. It

0:25:17.480 --> 0:25:20.240
<v Speaker 5>changes based on who is buying it and when they're

0:25:20.240 --> 0:25:23.840
<v Speaker 5>buying it. The best example of this probably airline pricing.

0:25:24.040 --> 0:25:26.680
<v Speaker 5>You know, people are very familiar with the idea that

0:25:26.720 --> 0:25:30.280
<v Speaker 5>the price of the airline ticket changes depending on when

0:25:30.320 --> 0:25:32.840
<v Speaker 5>you're buying it, like how close to the flight it is,

0:25:33.280 --> 0:25:35.480
<v Speaker 5>and sometimes whether you're logged in or not. So whether

0:25:35.560 --> 0:25:38.600
<v Speaker 5>it knows that you have like rewards or status with

0:25:38.640 --> 0:25:40.840
<v Speaker 5>that particular airline, it might change the price.

0:25:41.119 --> 0:25:44.520
<v Speaker 1>Does it also happen with like consumer products? Let's say

0:25:44.600 --> 0:25:46.879
<v Speaker 1>I don't know, vacuum cleaners. People are used to hearing

0:25:46.920 --> 0:25:49.879
<v Speaker 1>that about airlines, you know, when you book makes a difference,

0:25:49.880 --> 0:25:52.720
<v Speaker 1>et cetera. But what about like consumer products.

0:25:53.160 --> 0:25:56.399
<v Speaker 5>Yeah, So that's why that FTC is conducting the study

0:25:56.480 --> 0:25:59.400
<v Speaker 5>because they have heard from a lot of people that

0:25:59.560 --> 0:26:04.200
<v Speaker 5>companies are now sort of using these types of pricing

0:26:04.240 --> 0:26:07.119
<v Speaker 5>techniques on more and more consumer products. So one of

0:26:07.160 --> 0:26:10.280
<v Speaker 5>the biggest examples that people know about also is McDonald's.

0:26:10.320 --> 0:26:13.119
<v Speaker 5>For example, if you walk up to the counter or

0:26:13.119 --> 0:26:16.280
<v Speaker 5>go through the drive through at McDonald's, you're actually probably

0:26:16.320 --> 0:26:18.840
<v Speaker 5>going to be paying a little bit more money than

0:26:18.920 --> 0:26:22.080
<v Speaker 5>if you ordered a head through the apps because McDonald's

0:26:22.119 --> 0:26:26.520
<v Speaker 5>often gives out different types of rewards or you know,

0:26:26.600 --> 0:26:29.639
<v Speaker 5>price discounts if you're ordering through the app. So it

0:26:29.720 --> 0:26:32.760
<v Speaker 5>is becoming more and more common for these types of

0:26:33.160 --> 0:26:36.520
<v Speaker 5>consumer products to have some kind of dynamic pricing elements

0:26:36.560 --> 0:26:40.840
<v Speaker 5>to them, and they're very interested in how companies are

0:26:40.880 --> 0:26:44.000
<v Speaker 5>deciding when they want to use these types of discounts

0:26:44.080 --> 0:26:47.800
<v Speaker 5>or price hikes, and whether they might be using information

0:26:47.880 --> 0:26:51.479
<v Speaker 5>about individuals that's not technically allowed, so things like you

0:26:51.480 --> 0:26:54.160
<v Speaker 5>know your gender, your race, things like that that are

0:26:54.200 --> 0:26:56.680
<v Speaker 5>prevented by various discrimination laws.

0:26:56.920 --> 0:27:00.600
<v Speaker 1>Are they allowed to use the consumers online footprint?

0:27:01.160 --> 0:27:03.399
<v Speaker 5>So that's another thing that FEC is going to be

0:27:03.440 --> 0:27:07.480
<v Speaker 5>looking at, how much are these companies using your online footprint? Because,

0:27:07.480 --> 0:27:10.800
<v Speaker 5>for example, when you go online, a lot of that

0:27:10.960 --> 0:27:13.439
<v Speaker 5>is tracked through your browser history, and it's not that

0:27:13.560 --> 0:27:16.600
<v Speaker 5>hard sometimes for companies to like figure out maybe you

0:27:16.600 --> 0:27:19.240
<v Speaker 5>were looking at this pair of shoes online, so maybe

0:27:19.240 --> 0:27:21.280
<v Speaker 5>they should when you go into the store offer you

0:27:21.320 --> 0:27:23.479
<v Speaker 5>a discount or maybe a price hike on it. You

0:27:23.520 --> 0:27:26.800
<v Speaker 5>see it in different types of things like surge pricing

0:27:26.960 --> 0:27:29.800
<v Speaker 5>on Uber. There was a really interesting study that found

0:27:30.160 --> 0:27:33.800
<v Speaker 5>if your phone battery is low, Uber is much more

0:27:34.000 --> 0:27:39.720
<v Speaker 5>likely to put surge pricing on a particular fare because

0:27:40.160 --> 0:27:42.080
<v Speaker 5>you really know that you really need to get where

0:27:42.119 --> 0:27:47.960
<v Speaker 5>you're going before your phone dies. So that's outrageous to me. Yeah,

0:27:48.040 --> 0:27:51.959
<v Speaker 5>they found, like, there was a study that had a

0:27:52.000 --> 0:27:55.280
<v Speaker 5>few people at the same place ask for a ride

0:27:55.440 --> 0:27:58.440
<v Speaker 5>to the same location, and then they looked at how

0:27:58.480 --> 0:28:00.679
<v Speaker 5>much they were charging those people if they had a

0:28:00.720 --> 0:28:03.320
<v Speaker 5>full battery versus if they had a really low battery,

0:28:03.440 --> 0:28:06.160
<v Speaker 5>and the person with a really low battery was often

0:28:06.160 --> 0:28:09.200
<v Speaker 5>getting a much higher fare because Uber sort of knew

0:28:09.240 --> 0:28:11.680
<v Speaker 5>that they had more urgency and sort of getting to

0:28:11.720 --> 0:28:14.000
<v Speaker 5>the location before their phone died. So these are the

0:28:14.080 --> 0:28:16.479
<v Speaker 5>sorts of things that the SEC is looking at, Like,

0:28:16.600 --> 0:28:20.720
<v Speaker 5>how are companies determining the prices when they're when they're

0:28:20.720 --> 0:28:24.520
<v Speaker 5>doing these sorts of surge pricing or dynamic pricing options.

0:28:24.760 --> 0:28:27.560
<v Speaker 1>An app like that knows the strength of your battery.

0:28:27.960 --> 0:28:30.679
<v Speaker 5>Yeah, in terms of your phone, like there's actually a

0:28:30.720 --> 0:28:33.000
<v Speaker 5>lot of when you open an app, it knows a

0:28:33.000 --> 0:28:35.520
<v Speaker 5>lot of information about your phone. It knows you know,

0:28:35.560 --> 0:28:37.800
<v Speaker 5>what your battery level is. It might know some of

0:28:37.840 --> 0:28:40.800
<v Speaker 5>your contacts. They might know some other apps that you've

0:28:40.800 --> 0:28:43.560
<v Speaker 5>gone to on the phone. So for example, if you

0:28:44.080 --> 0:28:46.000
<v Speaker 5>open up the Uber app and then you open up

0:28:46.000 --> 0:28:49.640
<v Speaker 5>the Lift app, sometimes it might, you know, change the

0:28:49.680 --> 0:28:51.960
<v Speaker 5>price that's available because it knows that you might be

0:28:52.080 --> 0:28:55.040
<v Speaker 5>like checking between the two, sort of triaging the price.

0:28:55.480 --> 0:28:57.600
<v Speaker 1>So I do that all the time.

0:28:57.800 --> 0:28:59.880
<v Speaker 5>Yeah, I don't know if you've ever if you've ever

0:29:00.200 --> 0:29:02.480
<v Speaker 5>the food delivery app. This happens to me all the time.

0:29:02.520 --> 0:29:04.400
<v Speaker 5>Like if I open one of the food delivery apps,

0:29:04.400 --> 0:29:06.080
<v Speaker 5>all of a sudden, I start getting pop ups from

0:29:06.120 --> 0:29:09.000
<v Speaker 5>the other ones being like hungry, try this offer.

0:29:09.360 --> 0:29:12.120
<v Speaker 1>We're laughing, but it's scary that so much of your

0:29:12.120 --> 0:29:15.600
<v Speaker 1>personal information is exposed by an app.

0:29:15.920 --> 0:29:18.640
<v Speaker 5>Yeah, and that's part of what the FEC is trying

0:29:18.680 --> 0:29:20.239
<v Speaker 5>to look at here, they said, you know, they're not

0:29:20.320 --> 0:29:23.920
<v Speaker 5>necessarily implying that companies have done anything wrong, but they

0:29:23.920 --> 0:29:27.400
<v Speaker 5>do want to know how often companies are using these

0:29:27.440 --> 0:29:31.000
<v Speaker 5>types of information, what information is sort of going into

0:29:31.040 --> 0:29:34.880
<v Speaker 5>these types of algorithms that are determining price. A lot

0:29:34.880 --> 0:29:37.120
<v Speaker 5>of the companies that they sent these inquiries to, some

0:29:37.200 --> 0:29:39.760
<v Speaker 5>of them you've heard of like MasterCard and Jason Morgan,

0:29:40.040 --> 0:29:42.040
<v Speaker 5>but a lot of them are probably companies. You never

0:29:42.080 --> 0:29:46.239
<v Speaker 5>heard of something called Reveonics, Task Group Pros, but they

0:29:46.280 --> 0:29:49.400
<v Speaker 5>actually work for a lot of very household names. Taskworks

0:29:49.400 --> 0:29:54.080
<v Speaker 5>for Starbucks and McDonald's. Pros works for Luftanza the airline,

0:29:54.240 --> 0:29:57.840
<v Speaker 5>and Neshleie Revionics works for home Depot. Like all sorts

0:29:57.880 --> 0:30:00.400
<v Speaker 5>of companies are doing this more and more a sort

0:30:00.440 --> 0:30:03.800
<v Speaker 5>of trying to personalize pricing. You know, maybe you've gone

0:30:03.800 --> 0:30:05.520
<v Speaker 5>to Home Depot and they know that you're working on

0:30:05.560 --> 0:30:08.760
<v Speaker 5>some home projects, so like the next time you come in,

0:30:08.880 --> 0:30:11.479
<v Speaker 5>maybe they'll try and offer you a discount on you know,

0:30:11.480 --> 0:30:13.680
<v Speaker 5>whatever it is that you're working on, or maybe they

0:30:13.720 --> 0:30:16.040
<v Speaker 5>know that you're much more likely to like really need that,

0:30:16.120 --> 0:30:19.240
<v Speaker 5>so they might hike the price on something. It's very interesting,

0:30:19.240 --> 0:30:22.080
<v Speaker 5>we're in this new world sort of with pricing because

0:30:22.080 --> 0:30:24.960
<v Speaker 5>they now know a lot more about you and maybe

0:30:25.000 --> 0:30:26.320
<v Speaker 5>what you're more willing to pay for.

0:30:26.920 --> 0:30:30.000
<v Speaker 1>So they send subpoenas. What kind of information are they

0:30:30.040 --> 0:30:30.760
<v Speaker 1>asking for?

0:30:31.600 --> 0:30:34.280
<v Speaker 5>Yes, this is an FTP study, so they are allowed

0:30:34.280 --> 0:30:37.240
<v Speaker 5>to compel the companies to provide information, but they ask

0:30:37.320 --> 0:30:39.920
<v Speaker 5>them for a lot of details about one the services

0:30:39.920 --> 0:30:42.560
<v Speaker 5>that they offer with software. So some of these companies

0:30:42.600 --> 0:30:45.840
<v Speaker 5>call it like price optimization or search pricing. They have

0:30:45.920 --> 0:30:47.720
<v Speaker 5>a lot of different terms for what they do. So

0:30:47.760 --> 0:30:51.239
<v Speaker 5>they're asking them what specifically do you offer and how

0:30:51.240 --> 0:30:53.680
<v Speaker 5>would you describe it? And then what sort of information

0:30:53.800 --> 0:30:56.720
<v Speaker 5>goes into that sort of algorithm because often this is

0:30:56.760 --> 0:30:59.320
<v Speaker 5>done by computer algorithms, So they want to know what

0:30:59.360 --> 0:31:01.520
<v Speaker 5>are the inputs into that, so that they would want

0:31:01.520 --> 0:31:03.520
<v Speaker 5>to know, for example, are they looking at the phone

0:31:03.560 --> 0:31:06.120
<v Speaker 5>battery to determine this, Are they looking at you know,

0:31:06.280 --> 0:31:08.680
<v Speaker 5>your contacts and what other things you've looked at? And then,

0:31:09.000 --> 0:31:11.360
<v Speaker 5>as I said, are they looking at your browsing history?

0:31:11.960 --> 0:31:15.400
<v Speaker 5>And then they wanted to know how they choose which

0:31:15.440 --> 0:31:19.720
<v Speaker 5>offers because they do have some concerns that maybe companies

0:31:19.960 --> 0:31:23.280
<v Speaker 5>are sort of targeting richer consumers to give lots of

0:31:23.440 --> 0:31:26.040
<v Speaker 5>price hikes and not giving them to, you know, more

0:31:26.120 --> 0:31:30.000
<v Speaker 5>low income consumers, which might be potentially discriminatory. Whenever you

0:31:30.000 --> 0:31:32.920
<v Speaker 5>have your phone, it has some information about where you're located,

0:31:33.040 --> 0:31:36.920
<v Speaker 5>and geography could be going into this. Perhaps if you're

0:31:37.200 --> 0:31:40.080
<v Speaker 5>located in a lower income area, you're not as likely

0:31:40.160 --> 0:31:41.920
<v Speaker 5>to get some of these offers as you are if

0:31:41.960 --> 0:31:44.320
<v Speaker 5>you live in a rich suburb, So they really want

0:31:44.360 --> 0:31:46.680
<v Speaker 5>to know all of the inputs that are going into

0:31:46.680 --> 0:31:49.880
<v Speaker 5>how they decide what the offers are and who gets them.

0:31:50.480 --> 0:31:52.320
<v Speaker 1>You know, we think of the FTC, I think most

0:31:52.360 --> 0:31:55.440
<v Speaker 1>of us in a different way. They're doing this under

0:31:55.560 --> 0:31:57.360
<v Speaker 1>the so called six B Authority.

0:31:57.880 --> 0:32:00.680
<v Speaker 5>Yeah, so the FDC is an enforcement agency, but it

0:32:00.720 --> 0:32:03.920
<v Speaker 5>also has this really interesting research arm. Congress gave it

0:32:03.960 --> 0:32:06.560
<v Speaker 5>the ability to do these six PE studies. They're sort

0:32:06.600 --> 0:32:09.840
<v Speaker 5>of like market studies and they're allowed to compel information

0:32:09.880 --> 0:32:12.680
<v Speaker 5>from companies to sort of do a deep dive into

0:32:12.720 --> 0:32:16.120
<v Speaker 5>specific areas of the economy or areas of the market.

0:32:16.320 --> 0:32:18.640
<v Speaker 5>So they've done some of these on all sorts of things.

0:32:18.640 --> 0:32:21.480
<v Speaker 5>They've done them on pharmaceutical benefit managers, which are sort

0:32:21.480 --> 0:32:24.920
<v Speaker 5>of the drug middlemen who come up with pharmaceutical pricing

0:32:25.000 --> 0:32:28.160
<v Speaker 5>between the pharma companies and the health insurance. They've done

0:32:28.200 --> 0:32:33.240
<v Speaker 5>them on patentrols and like how much those were impacting innovation.

0:32:33.760 --> 0:32:40.080
<v Speaker 5>They've been doing ones on pricing of online Internet pricing.

0:32:40.360 --> 0:32:42.360
<v Speaker 5>That was one that came up sort of during the pandemic.

0:32:42.400 --> 0:32:44.760
<v Speaker 5>And they did one on supply chains, like what caused

0:32:44.840 --> 0:32:47.480
<v Speaker 5>some of the supply chain crises of the pandemic. So

0:32:47.680 --> 0:32:50.640
<v Speaker 5>the idea behind these studies is that, like the SPC

0:32:50.760 --> 0:32:53.920
<v Speaker 5>really does a deep dive into what is really happening,

0:32:53.960 --> 0:32:57.280
<v Speaker 5>and then they publish a study with the information and

0:32:57.320 --> 0:33:00.720
<v Speaker 5>that can help Congress as it is considering new laws,

0:33:00.840 --> 0:33:03.840
<v Speaker 5>or if the STC finds something that's a little bit questionable,

0:33:03.880 --> 0:33:06.920
<v Speaker 5>it can lead them to open an investigation into something

0:33:06.920 --> 0:33:07.560
<v Speaker 5>related to it.

0:33:07.800 --> 0:33:09.520
<v Speaker 1>How long do these studies usually take?

0:33:09.720 --> 0:33:11.440
<v Speaker 5>These studies do you tend to take a little bit

0:33:11.480 --> 0:33:14.000
<v Speaker 5>of time. Oftentimes when they start them, it takes like

0:33:14.040 --> 0:33:16.160
<v Speaker 5>maybe six months or so for the companies to send

0:33:16.160 --> 0:33:18.320
<v Speaker 5>them the information and then usually they spend a little

0:33:18.320 --> 0:33:20.960
<v Speaker 5>bit of time looking at it. So it's not unusual

0:33:21.080 --> 0:33:23.160
<v Speaker 5>for it to be a year or two before the

0:33:23.280 --> 0:33:25.200
<v Speaker 5>SPC publishes its findings.

0:33:25.520 --> 0:33:29.360
<v Speaker 1>Well, this has really opened my eyes about being tracked

0:33:29.400 --> 0:33:32.760
<v Speaker 1>by apps on your phone. Thanks so much, Leah. That's

0:33:32.800 --> 0:33:36.280
<v Speaker 1>Bloomberg Anti Trust reporter Leah Nylan And that's it for

0:33:36.280 --> 0:33:39.320
<v Speaker 1>this edition of the Bloomberg Law Podcast. Remember you can

0:33:39.360 --> 0:33:42.280
<v Speaker 1>always get the latest legal news by subscribing and listening

0:33:42.320 --> 0:33:46.040
<v Speaker 1>to the show on Apple Podcasts, Spotify, and at Bloomberg

0:33:46.080 --> 0:33:50.120
<v Speaker 1>dot com, Slash Podcast, Slash Law. I'm June Grosso and

0:33:50.280 --> 0:33:51.520
<v Speaker 1>this is Bloomberg.