1 00:00:02,759 --> 00:00:07,000 Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio. 2 00:00:08,680 --> 00:00:13,039 Speaker 1: A DC federal judge struck down President Donald Trump's order 3 00:00:13,360 --> 00:00:18,000 Speaker 1: targeting the law firm of Perkins Cooy, finding it unconstitutional. 4 00:00:18,360 --> 00:00:23,280 Speaker 1: Judge Beryl Howell barred executive branch agencies from enforcing Trump's 5 00:00:23,400 --> 00:00:27,920 Speaker 1: March sixth executive order, finding it was an unprecedented attack 6 00:00:28,040 --> 00:00:32,320 Speaker 1: on the foundational principles of the American judicial system. She 7 00:00:32,479 --> 00:00:36,360 Speaker 1: said in a cringe worthy twist on Shakespeare's Let's Kill 8 00:00:36,440 --> 00:00:40,959 Speaker 1: all the lawyers, Trump's executive order quote takes the approach 9 00:00:41,000 --> 00:00:44,519 Speaker 1: of let's kill the lawyers. I don't like sending the 10 00:00:44,600 --> 00:00:48,239 Speaker 1: clear message lawyers must stick to the party line or 11 00:00:48,320 --> 00:00:51,720 Speaker 1: else joining me is Professor Matthew Diller of Fordham Law 12 00:00:51,760 --> 00:00:55,040 Speaker 1: School remind us why Perkins Cooey was targeted. 13 00:00:55,520 --> 00:01:01,480 Speaker 2: So Perkins was targeted by the Trump administrator because it 14 00:01:01,640 --> 00:01:07,080 Speaker 2: had an active role in representing the Democrat and Hillary 15 00:01:07,080 --> 00:01:11,399 Speaker 2: Clinton in the twenty and sixteen election and then again 16 00:01:11,560 --> 00:01:16,800 Speaker 2: continue to do work on behalf of Democrat associated groups 17 00:01:17,040 --> 00:01:20,960 Speaker 2: around the twenty twenty election. So Donald Trump has had 18 00:01:21,000 --> 00:01:24,840 Speaker 2: it in for Perkins Cooey for almost a decade and 19 00:01:24,959 --> 00:01:29,440 Speaker 2: has tweeted and done social media postings denouncing them for 20 00:01:29,920 --> 00:01:33,360 Speaker 2: many years. So Perkins Cooey has always been very high 21 00:01:33,400 --> 00:01:34,240 Speaker 2: on this headlist. 22 00:01:34,640 --> 00:01:39,119 Speaker 1: The judge ruled that the order was unconstitutional. Tell us 23 00:01:39,120 --> 00:01:41,800 Speaker 1: what the basis of her ruling was. 24 00:01:42,120 --> 00:01:45,600 Speaker 2: So, first of all, it is a really remarkable ruling. 25 00:01:45,840 --> 00:01:49,280 Speaker 2: And what's remarkable about it is not the result, because 26 00:01:49,280 --> 00:01:52,400 Speaker 2: I think the result is what everyone who is watching 27 00:01:52,440 --> 00:01:57,000 Speaker 2: this case predicted. But what's remarkable about it is the 28 00:01:57,080 --> 00:02:01,600 Speaker 2: thoroughness and clarity of her decision and its comprehensiveness. So 29 00:02:01,800 --> 00:02:06,600 Speaker 2: in it she both addresses the big picture issues that 30 00:02:06,800 --> 00:02:10,320 Speaker 2: this executive order posed and its threats to the rule 31 00:02:10,320 --> 00:02:14,640 Speaker 2: of law, and then walked us through step by step 32 00:02:15,120 --> 00:02:19,640 Speaker 2: all the different particular ways in which it is unconstitutional, 33 00:02:19,760 --> 00:02:23,240 Speaker 2: and there are many, and then finally she addressed the 34 00:02:23,280 --> 00:02:26,840 Speaker 2: government's defenses. And so I think the fact that it 35 00:02:26,919 --> 00:02:29,800 Speaker 2: is so comprehensive and so clear will mean that it 36 00:02:29,880 --> 00:02:32,080 Speaker 2: has great influence. And I think people are going to 37 00:02:32,080 --> 00:02:34,680 Speaker 2: pay attention to this decision. Now haven't answered your question, 38 00:02:34,800 --> 00:02:37,200 Speaker 2: so let me come back to that. So she found 39 00:02:37,200 --> 00:02:41,480 Speaker 2: that the order against Perkins Kui was unconstitutional for a 40 00:02:41,600 --> 00:02:45,000 Speaker 2: number of reasons. The first and biggest is that it 41 00:02:45,120 --> 00:02:48,919 Speaker 2: violates the First Amendment in that it targets Perkins Kuhi 42 00:02:49,200 --> 00:02:53,760 Speaker 2: for its political views, for its political activity, for arguments 43 00:02:53,760 --> 00:02:56,920 Speaker 2: and representations it makes in court. And the Supreme Court 44 00:02:56,960 --> 00:03:01,920 Speaker 2: has long held that thectivity of representing clients in court 45 00:03:01,960 --> 00:03:05,480 Speaker 2: and presenting arguments of court is protected by the First Amendment, 46 00:03:05,639 --> 00:03:09,480 Speaker 2: and indeed that the ability to raise claims in court 47 00:03:09,639 --> 00:03:13,320 Speaker 2: is really core to our democratic system of government. It 48 00:03:13,639 --> 00:03:18,480 Speaker 2: violated rights of association in that it penalized clients for 49 00:03:18,560 --> 00:03:22,680 Speaker 2: associating with Perkins Cody. It violated the rights of employees 50 00:03:22,720 --> 00:03:26,160 Speaker 2: of Perkins Kui in a number of ways. So the 51 00:03:26,200 --> 00:03:30,400 Speaker 2: thrust and biggest overarching issue is false within the sculpe 52 00:03:30,400 --> 00:03:32,800 Speaker 2: at the First Amendment, but there are other problems with 53 00:03:32,880 --> 00:03:36,120 Speaker 2: it too, and the judge how walked us through those. 54 00:03:36,240 --> 00:03:40,560 Speaker 2: So Secondly, it violated due process because the executive order 55 00:03:40,600 --> 00:03:43,520 Speaker 2: came completely out of the blue. Perkins Kooy had no 56 00:03:43,640 --> 00:03:46,920 Speaker 2: notice of any charges or claims against it and had 57 00:03:46,960 --> 00:03:51,000 Speaker 2: no opportunity to respond. And so under our constitution, the 58 00:03:51,040 --> 00:03:54,280 Speaker 2: government takes action against someone that have to provide notice 59 00:03:54,320 --> 00:03:57,560 Speaker 2: and opportunity to be heard, and that wasn't done here. 60 00:03:57,840 --> 00:04:01,160 Speaker 2: And then She also found that certain aspects of the 61 00:04:01,280 --> 00:04:04,280 Speaker 2: order violated the new Process clause just because they were 62 00:04:04,360 --> 00:04:07,840 Speaker 2: so vague and that no one could really tell what 63 00:04:07,920 --> 00:04:10,640 Speaker 2: was prohibited what wasn't prohibited, and that section of the 64 00:04:10,720 --> 00:04:15,120 Speaker 2: rule in particularly deals with the order's treatment of Diversity, 65 00:04:15,160 --> 00:04:18,080 Speaker 2: Equity and Inclusion DEI, and have been a number of 66 00:04:18,120 --> 00:04:24,000 Speaker 2: cases challenging the administration's actions around DEI program because they 67 00:04:24,040 --> 00:04:26,880 Speaker 2: never really define what DEI is. 68 00:04:27,400 --> 00:04:30,920 Speaker 1: The series of executive orders were labeled as these law 69 00:04:30,920 --> 00:04:34,560 Speaker 1: firms were national security threats? Did she address that? 70 00:04:35,400 --> 00:04:37,800 Speaker 2: Yes, she did. And the reason this comes up is 71 00:04:37,800 --> 00:04:43,800 Speaker 2: because the orders talk about restinding security clearances for individuals 72 00:04:43,800 --> 00:04:47,039 Speaker 2: who work at PERKINSCOI, and so that normally would be 73 00:04:47,520 --> 00:04:51,080 Speaker 2: a national security analysis. What the drug fairly is focused 74 00:04:51,120 --> 00:04:53,120 Speaker 2: on is, first of all, the language of the order 75 00:04:53,160 --> 00:04:56,560 Speaker 2: itself talks not in terms of national security but in 76 00:04:56,680 --> 00:05:00,240 Speaker 2: terms of the national interest, and national interest is a 77 00:05:00,320 --> 00:05:03,039 Speaker 2: much broader category of things that seems to be whatever 78 00:05:03,400 --> 00:05:07,720 Speaker 2: the President wants it to be as opposed to national security. 79 00:05:07,920 --> 00:05:11,000 Speaker 2: It's not actually flamed around national security. But in terms 80 00:05:11,000 --> 00:05:15,640 Speaker 2: of removing of security clearances, what Judge Hall said is that, well, 81 00:05:15,640 --> 00:05:19,960 Speaker 2: it's very difficult for an individual to challenge the government's 82 00:05:19,960 --> 00:05:22,920 Speaker 2: determination that he or she does not deserve is not 83 00:05:22,960 --> 00:05:26,760 Speaker 2: trustworthy enough for a security clearance. What was done here 84 00:05:27,279 --> 00:05:32,880 Speaker 2: was not individualized determinations about whether each individual with security 85 00:05:32,920 --> 00:05:36,200 Speaker 2: clearance posed a threat of any kind, but rather just 86 00:05:36,640 --> 00:05:41,279 Speaker 2: a broad brush suspension of the security clearance. For I 87 00:05:41,279 --> 00:05:44,440 Speaker 2: think there are twenty five people at Perkins Coop you 88 00:05:44,560 --> 00:05:48,359 Speaker 2: have security clearances, and they were all suspended in the 89 00:05:48,400 --> 00:05:52,359 Speaker 2: same stroke with very little explanation other than saying in 90 00:05:52,400 --> 00:05:55,440 Speaker 2: the national interest, which doesn't quite do it. And so 91 00:05:55,520 --> 00:05:58,320 Speaker 2: what the judge said is that there was no individualized 92 00:05:58,320 --> 00:06:01,320 Speaker 2: determination of whether these indi it was actually worth threat 93 00:06:01,440 --> 00:06:04,720 Speaker 2: to national security. That's what the problem was for that, she. 94 00:06:04,839 --> 00:06:07,799 Speaker 1: Said, you know the clear messages, lawyers have to stick 95 00:06:07,839 --> 00:06:11,359 Speaker 1: to the party liner else and Paul Cleman, who is 96 00:06:11,400 --> 00:06:16,080 Speaker 1: representing Wilmer Hale in a similar case, told Judge Leon, 97 00:06:16,560 --> 00:06:18,360 Speaker 1: if I have to stand up here and argue in 98 00:06:18,360 --> 00:06:20,680 Speaker 1: front of the court today with one eye on how 99 00:06:20,720 --> 00:06:23,640 Speaker 1: this is going to be perceived by the executive branch 100 00:06:24,120 --> 00:06:26,400 Speaker 1: and how that's going to influence the interests of my 101 00:06:26,520 --> 00:06:29,320 Speaker 1: other clients, well I might as well go sit down. 102 00:06:30,080 --> 00:06:34,479 Speaker 1: Do you see these orders as more of a warning 103 00:06:34,640 --> 00:06:36,600 Speaker 1: to law firms writ large. 104 00:06:37,320 --> 00:06:40,120 Speaker 2: Yes, I think these are a threat to the legal 105 00:06:40,160 --> 00:06:43,640 Speaker 2: profession and lawyers in general, and really to anyone who 106 00:06:43,640 --> 00:06:47,200 Speaker 2: wants to push back against the Trump administration. And that's 107 00:06:47,200 --> 00:06:51,839 Speaker 2: what's so striking about, particularly the first part of these orders, 108 00:06:51,880 --> 00:06:55,080 Speaker 2: which the first part starts with as statements of the 109 00:06:55,120 --> 00:06:58,280 Speaker 2: purpose of the order, and it walks through all the 110 00:06:58,320 --> 00:07:03,160 Speaker 2: reasons why the administration doesn't like Perkinskoy and then doesn't 111 00:07:03,160 --> 00:07:08,000 Speaker 2: disguise the fact that that's why the administration is taking 112 00:07:08,040 --> 00:07:11,400 Speaker 2: these actions. And indeed, they issued a fact sheet that 113 00:07:11,520 --> 00:07:14,320 Speaker 2: went with the Perkins Cooey order that says Perkins Cooy 114 00:07:14,400 --> 00:07:19,400 Speaker 2: has filed lawsuits against the Trump administration, including one designed 115 00:07:19,400 --> 00:07:23,320 Speaker 2: to reduce military readiness. So the orders are very upfront 116 00:07:24,000 --> 00:07:26,760 Speaker 2: about how they are being triggered by the fact that 117 00:07:26,800 --> 00:07:30,320 Speaker 2: these law firms have opposed Donald Trump, and so it's 118 00:07:30,360 --> 00:07:34,600 Speaker 2: a clear warning that if you oppose the president, they 119 00:07:34,640 --> 00:07:35,400 Speaker 2: will come after you. 120 00:07:36,200 --> 00:07:39,480 Speaker 1: The judge skipped the trial, skipped having a trial, and 121 00:07:39,760 --> 00:07:41,880 Speaker 1: went directly to a final ruling. 122 00:07:42,560 --> 00:07:45,560 Speaker 2: So that's not unusual that the judge skipped the trial. 123 00:07:46,200 --> 00:07:48,040 Speaker 2: I would have been surprised if there have been a 124 00:07:48,120 --> 00:07:52,520 Speaker 2: file in a case like this, because really the order 125 00:07:52,720 --> 00:07:56,720 Speaker 2: is in my mind illegal, honest faith, and there's nothing 126 00:07:56,720 --> 00:07:59,960 Speaker 2: to have a trial about. When the illegality is claim 127 00:08:00,640 --> 00:08:04,000 Speaker 2: from the document itself, there's really no point to having 128 00:08:04,160 --> 00:08:07,520 Speaker 2: the trial. So that doesn't surprise me. What's striking about 129 00:08:07,520 --> 00:08:10,160 Speaker 2: it is how fast she turned around the whole thing. 130 00:08:10,600 --> 00:08:12,880 Speaker 2: You know, all of this began to unfold, I think 131 00:08:12,880 --> 00:08:15,960 Speaker 2: in March, and we're already at the point where she 132 00:08:16,160 --> 00:08:18,960 Speaker 2: has brought the case to final judgment with one hundred 133 00:08:19,000 --> 00:08:21,800 Speaker 2: page decision and it's only the very beginning of May. 134 00:08:22,280 --> 00:08:26,680 Speaker 2: That is incredibly fast, and it reflects just how seriously 135 00:08:26,880 --> 00:08:29,520 Speaker 2: she's taken the order to be a threat to our 136 00:08:29,840 --> 00:08:32,240 Speaker 2: system of government and our democracy. 137 00:08:32,679 --> 00:08:35,559 Speaker 1: This is the first order of its kind, but there 138 00:08:35,559 --> 00:08:38,280 Speaker 1: are other cases out there. Do you think that this 139 00:08:38,679 --> 00:08:41,720 Speaker 1: decision will have an impact on the other cases? 140 00:08:42,280 --> 00:08:45,800 Speaker 2: So I think this decision will certainly help the law 141 00:08:45,840 --> 00:08:49,720 Speaker 2: firms that are challenging other executive orders that are very similar. 142 00:08:50,440 --> 00:08:52,720 Speaker 2: I think, as I said at the top, the result 143 00:08:52,800 --> 00:08:56,319 Speaker 2: here is not surprising in the sense that it's pretty 144 00:08:56,320 --> 00:09:00,480 Speaker 2: hard to defend these orders that they feel illy they 145 00:09:00,559 --> 00:09:04,400 Speaker 2: are illegal, and so the outcome is not shocking, but 146 00:09:04,440 --> 00:09:08,559 Speaker 2: the eloquence and the thoroughness with which she has explained 147 00:09:08,600 --> 00:09:11,480 Speaker 2: it will be influential, and I do think other judges 148 00:09:11,520 --> 00:09:15,040 Speaker 2: will drop them at I also think that language from 149 00:09:15,040 --> 00:09:18,280 Speaker 2: this decision will show up at some of the reasonings 150 00:09:18,400 --> 00:09:22,640 Speaker 2: in other challenges to Trump executive orders that are unrelated 151 00:09:22,679 --> 00:09:25,640 Speaker 2: to the law firm executive orders, because you know, there 152 00:09:25,640 --> 00:09:30,640 Speaker 2: are other orders that are also retaliatory and were issued 153 00:09:30,720 --> 00:09:35,240 Speaker 2: in order to send threats to universities, to individuals, and 154 00:09:35,440 --> 00:09:39,160 Speaker 2: wherever the administration is seeking to punish people for things 155 00:09:39,160 --> 00:09:42,600 Speaker 2: that they're entitled to do. I think this will serve 156 00:09:42,640 --> 00:09:46,600 Speaker 2: as a precedent upon why that is improper and dangerous. 157 00:09:47,040 --> 00:09:51,560 Speaker 1: She ordered the government not to enforce the executive order. 158 00:09:51,840 --> 00:09:54,080 Speaker 1: Do we expect the government to follow that? I mean, 159 00:09:54,200 --> 00:09:56,160 Speaker 1: is there a way to track that this is really 160 00:09:56,200 --> 00:09:58,600 Speaker 1: going to be observed? 161 00:09:59,280 --> 00:10:01,200 Speaker 2: You know. One of the things that was striking about 162 00:10:01,200 --> 00:10:03,880 Speaker 2: what happened here is just how open and once they 163 00:10:03,920 --> 00:10:08,080 Speaker 2: were about it. For example, Perkins Cury reported that SEDIL 164 00:10:08,160 --> 00:10:12,559 Speaker 2: agencies began to cancel appointments with their lawyers, like within 165 00:10:12,720 --> 00:10:15,560 Speaker 2: days of when this executive order was issued, and they 166 00:10:15,559 --> 00:10:18,920 Speaker 2: would say, we're canceling this meeting because of the executive order. 167 00:10:19,000 --> 00:10:22,040 Speaker 2: So now going forward, of course they won't say that, 168 00:10:22,080 --> 00:10:24,360 Speaker 2: and they can't say that, and I don't expect them 169 00:10:24,400 --> 00:10:26,959 Speaker 2: to cancel those meetings because I don't think that they 170 00:10:27,040 --> 00:10:29,480 Speaker 2: necessarily wanted to cancel those meetings. I think they were 171 00:10:29,520 --> 00:10:32,199 Speaker 2: responding to the executive order, and they themselves, you know, 172 00:10:32,240 --> 00:10:36,240 Speaker 2: the federal officials themselves were intimidated. Whether it has other 173 00:10:37,040 --> 00:10:39,880 Speaker 2: subtle continuing effects, it's hard to say. 174 00:10:40,440 --> 00:10:44,440 Speaker 1: When this first happened, some law firms reported losing clients, 175 00:10:44,440 --> 00:10:48,520 Speaker 1: and I'm also wondering if some clients will still stay 176 00:10:48,520 --> 00:10:51,760 Speaker 1: away from firms like Perkins Couy knowing that they're not 177 00:10:51,880 --> 00:10:55,280 Speaker 1: in the favor of the administration. So there's this sort 178 00:10:55,320 --> 00:10:57,839 Speaker 1: of underlying threat. 179 00:10:58,160 --> 00:11:02,240 Speaker 2: So it's possible, possible that Perkins KOOI won't recover the 180 00:11:02,240 --> 00:11:04,520 Speaker 2: clients that are lost, and it's certainly lost a number 181 00:11:04,559 --> 00:11:07,480 Speaker 2: of clients. But you know, there are also reports out 182 00:11:07,559 --> 00:11:11,920 Speaker 2: now about clients that are choosing firms like Perkins Cooey 183 00:11:12,240 --> 00:11:17,160 Speaker 2: who stood up to the executive orders because you know, 184 00:11:17,240 --> 00:11:21,880 Speaker 2: they support the decision that Perkins Coooy made and it's 185 00:11:22,679 --> 00:11:26,800 Speaker 2: and it's bravery in standing up to a patently illegal 186 00:11:26,960 --> 00:11:29,959 Speaker 2: order and so now you know, the shoe may be 187 00:11:30,080 --> 00:11:32,720 Speaker 2: on the other foot, which is, are there clients who 188 00:11:32,840 --> 00:11:35,760 Speaker 2: are turning away from the firms that have settled with 189 00:11:35,880 --> 00:11:39,680 Speaker 2: Trump because those firms, you know, are they strong advocates 190 00:11:39,760 --> 00:11:41,719 Speaker 2: or are they not strong advocates. So there's a way 191 00:11:41,760 --> 00:11:45,840 Speaker 2: in which Perkins Koohy has really bolstered its reputation for 192 00:11:45,920 --> 00:11:48,680 Speaker 2: standing up for principle, for being a strong advocate, for 193 00:11:48,760 --> 00:11:50,880 Speaker 2: taking risk in ways that I think are going to 194 00:11:50,880 --> 00:11:52,080 Speaker 2: be attracted to clients. 195 00:11:52,640 --> 00:11:55,640 Speaker 1: Yeah, what do you think about the nine other law 196 00:11:55,720 --> 00:12:00,439 Speaker 1: firms that struck deals with the Trump administration's many even 197 00:12:00,480 --> 00:12:04,000 Speaker 1: before an executive order was issued about their firm, and 198 00:12:04,040 --> 00:12:07,200 Speaker 1: it's a total of almost a billion dollars in free 199 00:12:07,280 --> 00:12:08,360 Speaker 1: legal services. 200 00:12:09,880 --> 00:12:13,119 Speaker 2: First of all, this decision that came down is not surprising. 201 00:12:13,160 --> 00:12:16,440 Speaker 2: So it's pretty predictable that these orders would have been 202 00:12:16,480 --> 00:12:21,120 Speaker 2: stricken down. And so I think those firms were in 203 00:12:21,160 --> 00:12:26,080 Speaker 2: a difficult position because they're they're victims here. The administration 204 00:12:26,280 --> 00:12:30,400 Speaker 2: was in essence trying to extort benefits from them, and 205 00:12:30,440 --> 00:12:33,920 Speaker 2: they agreed to that, they acceded to it. I think, 206 00:12:34,120 --> 00:12:36,679 Speaker 2: you know a lot of these firms they're probably you know, 207 00:12:36,760 --> 00:12:39,800 Speaker 2: rethinking whether that was a great idea or not, and 208 00:12:39,840 --> 00:12:42,440 Speaker 2: we'll see what happens. And when I say we'll see 209 00:12:42,480 --> 00:12:45,679 Speaker 2: what happens, there are a lot of unanswered questions about 210 00:12:45,679 --> 00:12:49,720 Speaker 2: these agreements with law firms. So the one thing that's 211 00:12:49,720 --> 00:12:52,760 Speaker 2: been made public is the dollar value of the pro 212 00:12:52,880 --> 00:12:56,040 Speaker 2: bono work that the firms have agreed to provide. And 213 00:12:56,080 --> 00:13:00,400 Speaker 2: then it says for causes and clients mutually agreed upon 214 00:13:00,520 --> 00:13:04,680 Speaker 2: between the administration and the firm, and they provide a 215 00:13:04,679 --> 00:13:08,960 Speaker 2: few examples. But then since then, President Trump has gone 216 00:13:09,040 --> 00:13:12,760 Speaker 2: around citing all sorts of things that he wants these 217 00:13:12,800 --> 00:13:17,080 Speaker 2: firms to work on. And so if the administration follows 218 00:13:17,120 --> 00:13:19,920 Speaker 2: through on that, then the firms will be put to 219 00:13:20,000 --> 00:13:22,600 Speaker 2: the test of you know, do they really want to 220 00:13:22,679 --> 00:13:26,600 Speaker 2: represent the United States for free in trade negotiations? Do 221 00:13:26,720 --> 00:13:33,640 Speaker 2: they want to represent police accused of misconduct and excessive force? 222 00:13:33,840 --> 00:13:36,280 Speaker 2: You know, even when many of those cases, those those 223 00:13:36,280 --> 00:13:39,640 Speaker 2: police would have access to lawyers through the government that 224 00:13:39,720 --> 00:13:43,880 Speaker 2: they work for. There was a whole range of things 225 00:13:43,920 --> 00:13:47,400 Speaker 2: which which Trump is now going around saying he's going 226 00:13:47,440 --> 00:13:50,040 Speaker 2: to use these firms for. And it's not clear how 227 00:13:50,080 --> 00:13:52,880 Speaker 2: the firms would respond to those requests. And so I 228 00:13:52,880 --> 00:13:56,640 Speaker 2: think the firms may have opportunities to say, no, this 229 00:13:56,720 --> 00:13:59,160 Speaker 2: isn't what we signed up for, and to back out 230 00:13:59,160 --> 00:14:03,679 Speaker 2: of the agreement. The administration really pushes on these questions, 231 00:14:04,320 --> 00:14:07,360 Speaker 2: and so to that extent, this decision gives the firms 232 00:14:07,480 --> 00:14:10,479 Speaker 2: more leverage in how they implement the agreements. 233 00:14:10,720 --> 00:14:12,800 Speaker 1: And we'll see how the judges rule in the three 234 00:14:12,840 --> 00:14:17,280 Speaker 1: other cases involving law firms that were targeted and decided 235 00:14:17,320 --> 00:14:21,000 Speaker 1: to fight back. Thanks so much, Matthew. That's Professor Matthew 236 00:14:21,040 --> 00:14:25,680 Speaker 1: Diller of Fordham Law School. This is Bloomberg. Does teaching 237 00:14:25,720 --> 00:14:29,680 Speaker 1: middle schoolers about Islam along with other religions in a 238 00:14:29,760 --> 00:14:35,280 Speaker 1: World Culture and Geography class violate the First Amendment's establishment clause. 239 00:14:36,040 --> 00:14:39,120 Speaker 1: The Third Circuit Court of Appeals found that the curriculum 240 00:14:39,160 --> 00:14:42,760 Speaker 1: taught by a New Jersey school district didn't show any 241 00:14:42,800 --> 00:14:47,200 Speaker 1: of the hallmarks of religious establishment, ruling against the parents 242 00:14:47,200 --> 00:14:49,800 Speaker 1: of a seventh grader. Joining me is an expert in 243 00:14:49,840 --> 00:14:53,360 Speaker 1: the First Amendment, Professor Timothy Zick of William and Mary 244 00:14:53,440 --> 00:14:56,320 Speaker 1: Law School, Tim, can you explain what the parents were 245 00:14:56,360 --> 00:14:58,000 Speaker 1: complaining about? In this case? 246 00:14:58,640 --> 00:15:03,640 Speaker 3: Parents to the school district after their children were exposed 247 00:15:03,680 --> 00:15:09,280 Speaker 3: to materials on Islam in a course entitled World's Cultures 248 00:15:09,280 --> 00:15:13,000 Speaker 3: and Geography, and as part of that course, the children 249 00:15:13,000 --> 00:15:17,000 Speaker 3: were taught some basic information about a variety of faith that, 250 00:15:17,120 --> 00:15:19,720 Speaker 3: it turns out, in addition to Islam, they were taught 251 00:15:19,760 --> 00:15:25,040 Speaker 3: about Christianity, Judaism, Buddhism, and Hinduism. The challenge materials on 252 00:15:25,240 --> 00:15:28,120 Speaker 3: Islam were presented in a course of the course that 253 00:15:28,240 --> 00:15:30,640 Speaker 3: cover the Middle East and North Africa, where of course 254 00:15:30,800 --> 00:15:34,160 Speaker 3: Islam is the dominant religion, and to say, the materials 255 00:15:34,200 --> 00:15:37,000 Speaker 3: covered the general tenets of the faith, including some core 256 00:15:37,320 --> 00:15:41,080 Speaker 3: Muslim beliefs. The parents claimed that the school district's curriculum 257 00:15:41,320 --> 00:15:44,720 Speaker 3: was an establishment of religion, so that it violated the 258 00:15:44,800 --> 00:15:49,320 Speaker 3: First Amendment establishment clause, which says Congress shall make no 259 00:15:49,480 --> 00:15:53,760 Speaker 3: law respecting an Establishment of Religion. So that was the 260 00:15:53,800 --> 00:15:54,800 Speaker 3: claim that they litigated. 261 00:15:55,200 --> 00:15:59,320 Speaker 1: Were they only complaining about the Islam component of. 262 00:15:59,240 --> 00:16:03,720 Speaker 3: This, Yes, they were only complaining that Islam was, in 263 00:16:03,760 --> 00:16:06,520 Speaker 3: their view, not just covered in the way I described it, 264 00:16:06,840 --> 00:16:11,200 Speaker 3: but actually being sort of proselytized students in a coercive way. 265 00:16:11,360 --> 00:16:13,560 Speaker 3: So that was the sort of nub of their complaint 266 00:16:13,640 --> 00:16:17,000 Speaker 3: that their children were not being coerced to practice Islam 267 00:16:17,240 --> 00:16:20,680 Speaker 3: or accept it as some true belief system, and. 268 00:16:20,600 --> 00:16:24,320 Speaker 1: The court relied on the Supreme Court decision in the 269 00:16:24,320 --> 00:16:28,600 Speaker 1: case of Kennedy versus Bremerton, which is about the high 270 00:16:28,600 --> 00:16:32,000 Speaker 1: school football coach who wanted to pray on the fifty 271 00:16:32,080 --> 00:16:33,800 Speaker 1: yard line after games. 272 00:16:34,520 --> 00:16:36,440 Speaker 3: Well, that's one of the recent cases where the court 273 00:16:36,480 --> 00:16:39,640 Speaker 3: has been reconsidering. I guess I'll use that term. It's 274 00:16:39,760 --> 00:16:45,320 Speaker 3: establishment clause jurisprudence, or doctrine. So in that case and others, 275 00:16:45,360 --> 00:16:48,600 Speaker 3: it's sort of jettisoning some tests or standards it's used 276 00:16:48,640 --> 00:16:51,480 Speaker 3: over the years to determine whether or not there's been 277 00:16:51,480 --> 00:16:54,280 Speaker 3: an establishment of religion. They're doing it with free exercise 278 00:16:54,320 --> 00:16:57,200 Speaker 3: as well, but particularly with establishment here. So you're right, 279 00:16:57,280 --> 00:16:59,800 Speaker 3: that is the case involving the high school football coach 280 00:16:59,800 --> 00:17:02,400 Speaker 3: who parade on the fifty yard line, and the school 281 00:17:02,400 --> 00:17:07,040 Speaker 3: district has terminated his employment because of that. They feared 282 00:17:07,080 --> 00:17:09,959 Speaker 3: that letting him do that, permitting him to do that, 283 00:17:10,000 --> 00:17:13,639 Speaker 3: and employing him would be viewed or perceived as an 284 00:17:13,720 --> 00:17:16,119 Speaker 3: endorsement of religion, which at the time was one of 285 00:17:16,119 --> 00:17:18,919 Speaker 3: the standards the court was applying to determine whether the 286 00:17:19,080 --> 00:17:22,760 Speaker 3: establishment clause had been violated. So when Kennedy, the Court says, no, 287 00:17:22,800 --> 00:17:25,040 Speaker 3: we don't do that anymore. We're not asking about whether 288 00:17:25,240 --> 00:17:30,720 Speaker 3: someone mistakenly perceived that as endorsing religion. We're not using 289 00:17:30,840 --> 00:17:33,360 Speaker 3: an old test that was called the Lemon test from 290 00:17:33,359 --> 00:17:36,600 Speaker 3: a case way back. We were going to ask whether 291 00:17:36,720 --> 00:17:39,439 Speaker 3: or not the practice is and that's been sort of 292 00:17:39,480 --> 00:17:44,600 Speaker 3: consistent with history and tradition. So as in other parts 293 00:17:44,640 --> 00:17:49,080 Speaker 3: of the constitutional landscape, the Court has moved steadily toward 294 00:17:49,440 --> 00:17:53,080 Speaker 3: this notion of determining whether there's been a violation based 295 00:17:53,119 --> 00:17:55,760 Speaker 3: on what history and tradition tell us. 296 00:17:56,240 --> 00:17:58,120 Speaker 1: How the Third Circuit analyze it in. 297 00:17:58,040 --> 00:18:01,320 Speaker 3: This case, yeah, the Third Circuit spent some time trying 298 00:18:01,359 --> 00:18:03,919 Speaker 3: to figure out how to apply that test history and 299 00:18:03,960 --> 00:18:07,480 Speaker 3: tradition to these circumstances. One of the problems, of course, 300 00:18:07,600 --> 00:18:10,600 Speaker 3: is that if the Founding there were really no free 301 00:18:10,680 --> 00:18:14,160 Speaker 3: public schools, so a dispute like this could not have arisen. 302 00:18:14,560 --> 00:18:18,560 Speaker 3: So they started generalized to well, what did official establishment 303 00:18:18,600 --> 00:18:21,960 Speaker 3: of religion look like that the Founding when you had 304 00:18:22,000 --> 00:18:26,280 Speaker 3: sort of state established or sanctioned churches. So they've relied 305 00:18:26,280 --> 00:18:29,600 Speaker 3: on a number of different factors, the Third Circuit mostly 306 00:18:29,640 --> 00:18:32,640 Speaker 3: boiling down to whether or not the school children had 307 00:18:32,680 --> 00:18:37,919 Speaker 3: been course into practicing a religion or punished for not 308 00:18:38,080 --> 00:18:41,000 Speaker 3: practicing it. Were they being sort of led through some 309 00:18:41,080 --> 00:18:45,200 Speaker 3: kind of religious ceremony rather than a sort of secular 310 00:18:45,480 --> 00:18:50,480 Speaker 3: curricular exercise. Were they, as a parent's challenge, being procestized 311 00:18:50,600 --> 00:18:54,080 Speaker 3: into sort of accepting or believing the tenants of Islam? 312 00:18:54,800 --> 00:18:57,280 Speaker 3: And on each of those points, the Court said, No, 313 00:18:57,840 --> 00:19:01,280 Speaker 3: this was a secular exercise. And no student was forced 314 00:19:01,280 --> 00:19:03,800 Speaker 3: to adopt any the tenants of Islam as they worked 315 00:19:03,800 --> 00:19:07,879 Speaker 3: through the course materials, or otherwise compelled to practice Islam. 316 00:19:08,200 --> 00:19:11,359 Speaker 3: They're essentially just teaching kids about other faiths, which is not, 317 00:19:11,520 --> 00:19:15,680 Speaker 3: the Court said, coercion of religious belief. So contextas t 318 00:19:16,119 --> 00:19:18,000 Speaker 3: the Court said, and this was again part of a 319 00:19:18,040 --> 00:19:20,640 Speaker 3: secular course on world culture and geography. 320 00:19:20,920 --> 00:19:23,040 Speaker 1: I'm not saying it happened in this case. But in 321 00:19:23,080 --> 00:19:26,119 Speaker 1: the football coach case, I mean, it seemed like some 322 00:19:26,280 --> 00:19:30,959 Speaker 1: of the kids were feeling coerced into praying with the coach. 323 00:19:31,560 --> 00:19:34,359 Speaker 1: You know, there were concerns perhaps about whether the coach 324 00:19:34,480 --> 00:19:37,920 Speaker 1: might treat them differently if they didn't pray with him, 325 00:19:38,280 --> 00:19:40,880 Speaker 1: but the Supreme Court dismissed those I mean, what does 326 00:19:40,920 --> 00:19:43,000 Speaker 1: it take to feel coercion. 327 00:19:43,520 --> 00:19:45,800 Speaker 3: I think that's an open question. You know, there was 328 00:19:45,840 --> 00:19:48,639 Speaker 3: a dispute about the record in the Kennedy case, the 329 00:19:48,680 --> 00:19:52,720 Speaker 3: football coach case. Obviously, the thesenter felt that the kids 330 00:19:52,760 --> 00:19:57,840 Speaker 3: were being coersed, even if subtly, to participate in an 331 00:19:57,840 --> 00:20:02,159 Speaker 3: exercise of prayer. Course saw it differently. They said he 332 00:20:02,240 --> 00:20:05,560 Speaker 3: mostly prayed by himself. He wasn't sort of telling the 333 00:20:05,600 --> 00:20:07,960 Speaker 3: students to come. In fact, you know, they were busy 334 00:20:08,000 --> 00:20:10,000 Speaker 3: doing other things while he was praying at the fifty 335 00:20:10,080 --> 00:20:13,119 Speaker 3: yard line. One of the main incidents in that case 336 00:20:13,280 --> 00:20:16,800 Speaker 3: was about the opposing team and their students coming to pray, 337 00:20:16,840 --> 00:20:20,479 Speaker 3: and that, of course isn't coersion of his players. So 338 00:20:20,880 --> 00:20:24,760 Speaker 3: it's not clear exactly what the court would require in 339 00:20:24,880 --> 00:20:27,560 Speaker 3: order to find that someone was coursed. I suppose if 340 00:20:27,560 --> 00:20:31,320 Speaker 3: you made it part of their performance evaluation, whether is 341 00:20:31,320 --> 00:20:34,520 Speaker 3: it the sport or their grade, to sort of participate 342 00:20:34,960 --> 00:20:38,400 Speaker 3: in what's effectively a religious ceremony, that would constitute coercion. 343 00:20:38,640 --> 00:20:40,720 Speaker 3: But in the Kennedy case, the court just didn't read 344 00:20:40,720 --> 00:20:42,680 Speaker 3: the fact that way, at least the majority didn't. 345 00:20:43,040 --> 00:20:46,560 Speaker 1: So Americans United for Separation of Church and State said 346 00:20:46,560 --> 00:20:50,400 Speaker 1: that this case had all the hallmarks of a manufactured 347 00:20:50,480 --> 00:20:55,199 Speaker 1: controversy by far right groups. I mean, bringing a lawsuit 348 00:20:55,359 --> 00:20:59,159 Speaker 1: over such a limited part of the curriculum might be 349 00:20:59,240 --> 00:21:00,600 Speaker 1: seen as an reaction. 350 00:21:01,119 --> 00:21:03,080 Speaker 3: I mean this is part of a larger sort of 351 00:21:03,080 --> 00:21:08,919 Speaker 3: culture war around curriculum and books and parental objection and 352 00:21:08,960 --> 00:21:14,040 Speaker 3: parental control over what students are exposed to in the classroom. 353 00:21:14,440 --> 00:21:18,000 Speaker 3: And you know, if you understand sort of what establishment 354 00:21:18,200 --> 00:21:22,640 Speaker 3: is historically, traditionally and otherwise in the courts of the doctrine, 355 00:21:22,840 --> 00:21:26,360 Speaker 3: this seems like a very weak case. And it is because, 356 00:21:26,480 --> 00:21:29,440 Speaker 3: of course, the students aren't being sort of paid through 357 00:21:29,480 --> 00:21:32,119 Speaker 3: some kind of religious ceremony. They're not being graded on 358 00:21:32,520 --> 00:21:36,640 Speaker 3: accepting as true the tenants of Islam. Maybe most importantly, 359 00:21:36,680 --> 00:21:39,919 Speaker 3: they're being taught about all sorts of staiths. And I 360 00:21:39,960 --> 00:21:42,639 Speaker 3: think you know that the parents are objecting to what 361 00:21:42,760 --> 00:21:45,880 Speaker 3: they consider to be sort of an anti Christian sort 362 00:21:45,880 --> 00:21:49,080 Speaker 3: of mindset in the schools where if a student mentions, 363 00:21:49,119 --> 00:21:52,120 Speaker 3: you know, Jesus Christ, they're shushed and they can't say that. 364 00:21:52,240 --> 00:21:55,040 Speaker 3: But here's the school district sort of teaching about Islam. 365 00:21:55,480 --> 00:21:58,400 Speaker 3: But again, as the court said, the third Circuit context 366 00:21:58,440 --> 00:22:01,639 Speaker 3: is key. This is not an single out or favor 367 00:22:01,680 --> 00:22:05,879 Speaker 3: one religion over another. It's part of a secular course. 368 00:22:06,200 --> 00:22:08,560 Speaker 3: So yeah, it stretched one as a very weak key. 369 00:22:09,520 --> 00:22:12,080 Speaker 1: I want to turn down to this project you have, 370 00:22:12,320 --> 00:22:16,720 Speaker 1: and it's quite a project. You're compiling a repository of 371 00:22:16,920 --> 00:22:22,640 Speaker 1: all Trump's First Amendment related executive orders, lawsuits over them, 372 00:22:22,880 --> 00:22:26,800 Speaker 1: and commentary about them. Tell us why you started this 373 00:22:27,200 --> 00:22:29,640 Speaker 1: and what you want to accomplish with it. 374 00:22:30,119 --> 00:22:32,320 Speaker 3: So you know, for better or words. I started out 375 00:22:32,359 --> 00:22:35,200 Speaker 3: on this project at the urging of Ron Collins, another 376 00:22:35,560 --> 00:22:38,680 Speaker 3: First Amendment guru, and he thought, of you a good 377 00:22:38,720 --> 00:22:40,639 Speaker 3: idea and I did too, to sort of keep track 378 00:22:41,000 --> 00:22:44,440 Speaker 3: sort of records of what the Trump administration is doing. 379 00:22:44,480 --> 00:22:47,399 Speaker 3: As Trump is signing you know, literally over one hundred 380 00:22:47,480 --> 00:22:50,040 Speaker 3: executive orders in the first like ninety days of his 381 00:22:50,760 --> 00:22:55,200 Speaker 3: second term. Posted twenty of those actually impact or effect 382 00:22:55,280 --> 00:22:59,320 Speaker 3: free expression. So my resource, which is being hosted at 383 00:22:59,520 --> 00:23:02,399 Speaker 3: First Amend mid Watch, which is the First Amendment website, 384 00:23:02,840 --> 00:23:07,600 Speaker 3: has those orders, but also the now approximately forty lawsuits 385 00:23:07,680 --> 00:23:11,680 Speaker 3: challenging various executive orders and provisions of those orders on 386 00:23:11,800 --> 00:23:13,960 Speaker 3: First Amendment grounds. And then we thought it would be 387 00:23:14,000 --> 00:23:16,399 Speaker 3: a good idea so to keep track of the commentary 388 00:23:16,480 --> 00:23:19,919 Speaker 3: analysis which gives you a sense of just how broad 389 00:23:20,200 --> 00:23:24,480 Speaker 3: and deep this agenda that the administration is adopted it. 390 00:23:24,960 --> 00:23:27,920 Speaker 3: So the document currently a sort of a word document, 391 00:23:28,119 --> 00:23:31,200 Speaker 3: stretches over fifty pages, and that's in roughly one hundred 392 00:23:31,280 --> 00:23:35,040 Speaker 3: days of the second Trump administration, and it just shows 393 00:23:35,040 --> 00:23:38,040 Speaker 3: no sign of slowing down. So part of the reason 394 00:23:38,080 --> 00:23:40,200 Speaker 3: I did that not just to keep a record or 395 00:23:40,240 --> 00:23:43,280 Speaker 3: an archive of this period. So imagine, you know, back 396 00:23:43,280 --> 00:23:46,480 Speaker 3: in the Macarthy era, someone was actually sort of keeping 397 00:23:46,520 --> 00:23:49,040 Speaker 3: an archive or record everything that's going on. So we 398 00:23:49,119 --> 00:23:51,919 Speaker 3: set out to do that. But it's also pretty common 399 00:23:51,960 --> 00:23:54,719 Speaker 3: for people to say to me, well, all presidents clash 400 00:23:54,760 --> 00:23:58,320 Speaker 3: with the press, and they all create free speech controversies, 401 00:23:58,680 --> 00:24:01,679 Speaker 3: isn't it just business as you? And I think this 402 00:24:01,760 --> 00:24:04,159 Speaker 3: document speaks for itself. If you go and visit it 403 00:24:04,160 --> 00:24:08,000 Speaker 3: at first Amendment, watch it's clearly unprecedented sort of a 404 00:24:08,040 --> 00:24:12,000 Speaker 3: whole of government, whole of society use of executive power 405 00:24:12,320 --> 00:24:16,040 Speaker 3: to control and chill expressions. And I think, you know, again, 406 00:24:16,080 --> 00:24:19,040 Speaker 3: the document sort of speaks to that. And I don't 407 00:24:19,080 --> 00:24:22,280 Speaker 3: think it's sort of an unwarded panic of any kind. 408 00:24:22,320 --> 00:24:25,000 Speaker 3: I mean, it's clear in the court that judges are 409 00:24:25,040 --> 00:24:28,920 Speaker 3: viewing much of what's going on here is troubling. The 410 00:24:28,920 --> 00:24:31,720 Speaker 3: one judge, for example, in response to one of these 411 00:24:31,760 --> 00:24:35,280 Speaker 3: executive orders that targets the law firms based on their 412 00:24:35,560 --> 00:24:39,199 Speaker 3: causes and clients, he said, it chills my spine what 413 00:24:39,320 --> 00:24:42,960 Speaker 3: the administration is doing here. So I wanted to keep 414 00:24:42,960 --> 00:24:45,120 Speaker 3: a record of that, so keep track of just how 415 00:24:45,160 --> 00:24:50,919 Speaker 3: many different aspects of society are being affected by the 416 00:24:50,960 --> 00:24:54,400 Speaker 3: stroke of a pen, essentially the use of executive orders. 417 00:24:54,480 --> 00:24:57,720 Speaker 3: And I have to say, you know he's managed President 418 00:24:57,800 --> 00:25:05,160 Speaker 3: Trump to reach law firms, library laboratory, museums, corporations, because 419 00:25:05,160 --> 00:25:08,199 Speaker 3: I say it's it's very broad, very deep, and to me, 420 00:25:08,520 --> 00:25:10,880 Speaker 3: as a First Amendment proponent, very troubling. 421 00:25:11,200 --> 00:25:12,760 Speaker 1: And for those who want to take a look at 422 00:25:12,760 --> 00:25:17,960 Speaker 1: the breath of these First Amendment related executive orders, you 423 00:25:18,000 --> 00:25:21,240 Speaker 1: can go to First Amendment watch dot org. And Tim, 424 00:25:21,240 --> 00:25:24,120 Speaker 1: I know you intend to keep this up to date 425 00:25:24,240 --> 00:25:27,600 Speaker 1: going forward, and we'll see how long this compilation is 426 00:25:28,119 --> 00:25:31,160 Speaker 1: at the end of four years. Thanks so much, Tim. 427 00:25:31,400 --> 00:25:35,959 Speaker 1: That's Professor Timothy Zick of William and Mary Law School, Harvard. 428 00:25:35,960 --> 00:25:39,720 Speaker 1: Has come under repeated fire from President Donald Trump and 429 00:25:39,840 --> 00:25:44,040 Speaker 1: his conservative allies, who accuse it and other elite universities 430 00:25:44,080 --> 00:25:48,280 Speaker 1: of ideological bias. In the latest escalation of the clash 431 00:25:48,320 --> 00:25:52,760 Speaker 1: between the Trump administration and the nation's oldest university, the 432 00:25:52,840 --> 00:25:57,400 Speaker 1: administration announced today it's blocking Harvard from new research grants 433 00:25:57,720 --> 00:26:02,760 Speaker 1: due to concerns over quote recons responsible management. Just last week, 434 00:26:02,840 --> 00:26:06,520 Speaker 1: Trump said in a social media post that Harvard would 435 00:26:06,600 --> 00:26:10,719 Speaker 1: lose its tax exempt status. Joining me is George Yinn, 436 00:26:10,760 --> 00:26:14,359 Speaker 1: emeritus law professor at the University of Virginia and former 437 00:26:14,480 --> 00:26:19,000 Speaker 1: chief of staff of the Congressional Joint Committee on Taxation. George, 438 00:26:19,040 --> 00:26:23,040 Speaker 1: will you start by explaining why most universities have tax 439 00:26:23,080 --> 00:26:25,679 Speaker 1: exempt status and what it means. 440 00:26:26,480 --> 00:26:29,320 Speaker 4: Well, here we're talking about a particular category of tax 441 00:26:29,359 --> 00:26:32,960 Speaker 4: exemption that's under five oh one C. Three, and under 442 00:26:33,000 --> 00:26:37,440 Speaker 4: that provision, there are a series of conditions that must 443 00:26:37,480 --> 00:26:41,960 Speaker 4: be meant to qualify. The organization must be operated exclusively 444 00:26:42,080 --> 00:26:46,720 Speaker 4: for certain qualifying purposes, which would include education. No part 445 00:26:46,760 --> 00:26:49,439 Speaker 4: of its net earnings may inure to the benefit of 446 00:26:49,520 --> 00:26:53,960 Speaker 4: a private individual. The organization is not allowed to engage 447 00:26:53,960 --> 00:26:59,800 Speaker 4: in any substantial lobbying activities or engage in any political 448 00:27:00,080 --> 00:27:04,560 Speaker 4: campaign activities. And finally, the organization may not engage in 449 00:27:04,680 --> 00:27:10,480 Speaker 4: activities that are considered contrary to national public policy. So 450 00:27:10,560 --> 00:27:14,879 Speaker 4: those are the basic requirements. The benefit of the status, 451 00:27:14,920 --> 00:27:18,800 Speaker 4: there are several benefits. A main benefit is obviously the 452 00:27:18,880 --> 00:27:22,800 Speaker 4: exemption of the organization's income from taxation, but there are 453 00:27:22,840 --> 00:27:27,080 Speaker 4: other very important benefits. The most common one people know 454 00:27:27,320 --> 00:27:32,840 Speaker 4: is the ability to deduct your donations to these organizations 455 00:27:32,920 --> 00:27:36,359 Speaker 4: as a charitable contribution, and in India to that. There 456 00:27:36,400 --> 00:27:39,600 Speaker 4: are some additional benefits, such as the availability for tax 457 00:27:39,640 --> 00:27:44,440 Speaker 4: exempt bond financing, So there are significant tax benefits. There 458 00:27:44,480 --> 00:27:48,679 Speaker 4: are some, you know, very specific conditions that have to 459 00:27:48,720 --> 00:27:52,119 Speaker 4: be met to qualify under C three status. 460 00:27:53,160 --> 00:27:57,000 Speaker 1: Trump wrote in a post on truth Social We're going 461 00:27:57,040 --> 00:28:01,600 Speaker 1: to take away Harvard's tax exempt status they deserve. He 462 00:28:01,680 --> 00:28:04,520 Speaker 1: didn't say why, but he had previously said it should 463 00:28:04,520 --> 00:28:07,280 Speaker 1: lose its tax exempt status and be taxed as a 464 00:28:07,320 --> 00:28:11,960 Speaker 1: political entity if it keeps pushing political, ideological and terrorist 465 00:28:12,080 --> 00:28:17,640 Speaker 1: inspired supporting sickness. I mean, can a president just take 466 00:28:17,680 --> 00:28:20,359 Speaker 1: away a university's tax exempt status? 467 00:28:21,040 --> 00:28:24,640 Speaker 4: The short answer is no. There is a well established 468 00:28:25,200 --> 00:28:31,199 Speaker 4: legal process for granting the status and infrequently, very infrequently, 469 00:28:31,320 --> 00:28:36,280 Speaker 4: revoking the status. It involves an application to the RS, 470 00:28:36,480 --> 00:28:41,040 Speaker 4: and then subsequently the IRS may review the status and 471 00:28:41,440 --> 00:28:46,880 Speaker 4: recommend a revocation of that status. These decisions are not 472 00:28:47,040 --> 00:28:50,240 Speaker 4: made just by order of the President or any other 473 00:28:50,360 --> 00:28:54,200 Speaker 4: top governmental official. The decisions are required to be made 474 00:28:54,240 --> 00:28:57,920 Speaker 4: in an even handed, non partisan way by the IRS. 475 00:28:58,040 --> 00:29:01,920 Speaker 4: Some of your listeners may recall a big controversy that 476 00:29:02,000 --> 00:29:06,560 Speaker 4: a rodes in twenty twelve or twenty thirteen regarding the 477 00:29:06,640 --> 00:29:10,440 Speaker 4: alleged discrimination by Lois Lerner, who at the time was 478 00:29:10,520 --> 00:29:15,600 Speaker 4: the head of the IRS's Exempt Organization Division against Applicants 479 00:29:15,720 --> 00:29:20,560 Speaker 4: for tax Exemption, which had a Tea Party affiliation. When 480 00:29:20,600 --> 00:29:23,320 Speaker 4: this story came to light, the House Ways and Means 481 00:29:23,320 --> 00:29:26,880 Speaker 4: Committee examined the case and actually made a referral to 482 00:29:27,000 --> 00:29:32,200 Speaker 4: the Justice Department for possible criminal prosecution of Mislearner because 483 00:29:32,200 --> 00:29:35,440 Speaker 4: she had acted not in an even handed and non 484 00:29:35,520 --> 00:29:39,160 Speaker 4: partisan way, according to them. I researched this matter very 485 00:29:39,200 --> 00:29:43,080 Speaker 4: closely and concluded that the evidence presented by the House 486 00:29:43,120 --> 00:29:47,840 Speaker 4: Committee to the Justice Department was laughable and did not 487 00:29:47,920 --> 00:29:52,720 Speaker 4: support in any way any wrongdoing by Learner or the IRS, 488 00:29:52,800 --> 00:29:57,320 Speaker 4: and the Justice Department subsequently agreed. The conditions for cvree 489 00:29:57,360 --> 00:30:03,920 Speaker 4: status are somewhat vague, certainly present a challenging administrative responsibility 490 00:30:04,120 --> 00:30:07,800 Speaker 4: for the Tax Agency. But I thought the evidence showed 491 00:30:07,880 --> 00:30:11,640 Speaker 4: simply showed the IRS doing what it's supposed to be doing, 492 00:30:11,800 --> 00:30:15,920 Speaker 4: which is to follow up and investigate credible leads regarding 493 00:30:15,920 --> 00:30:18,840 Speaker 4: the qualification of an organization for. 494 00:30:18,880 --> 00:30:23,920 Speaker 1: That status, Harvard said it would be an unlawful misuse 495 00:30:23,960 --> 00:30:27,320 Speaker 1: of the US Tax Code section which is entitled Prohibition 496 00:30:27,400 --> 00:30:32,200 Speaker 1: on Executive Branch Influence over taxpayer audits and other investigations, 497 00:30:32,960 --> 00:30:35,240 Speaker 1: which makes it a crime for the President or other 498 00:30:35,360 --> 00:30:40,520 Speaker 1: executive Branch members to directly or indirectly request that the 499 00:30:40,560 --> 00:30:47,040 Speaker 1: IRS investigate or audit a particular organization. A spokesperson for 500 00:30:47,400 --> 00:30:50,720 Speaker 1: the White House said afterwards that the IRS actions were 501 00:30:50,800 --> 00:30:55,120 Speaker 1: independent of the president and that any audit or investigations 502 00:30:55,120 --> 00:30:57,680 Speaker 1: were initiated before Trump's post. 503 00:30:57,840 --> 00:31:00,400 Speaker 4: Yeah, you're absolutely right, and they are actual. There are 504 00:31:00,440 --> 00:31:03,640 Speaker 4: several issues, and let me just run through them. The 505 00:31:03,640 --> 00:31:06,600 Speaker 4: first thing Harvard is arguing, and this is under section 506 00:31:06,720 --> 00:31:09,800 Speaker 4: seventy two seventeen of the Code, that it's a felony 507 00:31:09,960 --> 00:31:13,760 Speaker 4: for the president, vice president, their staff, and every cabinet 508 00:31:13,800 --> 00:31:17,920 Speaker 4: member other than the Attorney General to direct the IRS 509 00:31:17,960 --> 00:31:21,800 Speaker 4: to conduct or terminate and ordered of any taxpayer. And 510 00:31:21,880 --> 00:31:25,080 Speaker 4: so the argument is that the president's assertion at the 511 00:31:25,120 --> 00:31:29,400 Speaker 4: outset could be interpreted as directing the IRS to begin 512 00:31:29,640 --> 00:31:35,160 Speaker 4: a review of Harvard's tax status and violation of that provision. Now, 513 00:31:35,400 --> 00:31:39,600 Speaker 4: it's true that the president, thanks to the twenty twenty 514 00:31:39,600 --> 00:31:44,120 Speaker 4: four Supreme Court case Trump the US, the President may 515 00:31:44,160 --> 00:31:48,959 Speaker 4: claim immunity from criminal prosecution by reason of the holding 516 00:31:49,000 --> 00:31:52,360 Speaker 4: in that case, so long as the President is found 517 00:31:52,400 --> 00:31:57,040 Speaker 4: to have been performing his official duties rather than personal actions. 518 00:31:57,240 --> 00:32:01,600 Speaker 4: The argument would be that his responsibilities include taking care 519 00:32:01,720 --> 00:32:05,160 Speaker 4: that laws are faithfully executed, and so the President might 520 00:32:05,200 --> 00:32:09,040 Speaker 4: claim while directing the audit and challenge of any taxpayer's 521 00:32:09,080 --> 00:32:12,720 Speaker 4: exemption as part of that duty. It's important to note, however, 522 00:32:13,280 --> 00:32:17,280 Speaker 4: that other people are also subject to seventy two seventeen, 523 00:32:17,640 --> 00:32:21,440 Speaker 4: in particular virtually all the cabinet members, the vice president, 524 00:32:21,680 --> 00:32:25,400 Speaker 4: and their staff, and they don't have the same immunity 525 00:32:25,800 --> 00:32:29,640 Speaker 4: that the Supreme Court found in that case. So if, 526 00:32:29,720 --> 00:32:33,240 Speaker 4: for example, the President asked the Vice president or the 527 00:32:33,280 --> 00:32:38,120 Speaker 4: Treasury Secretary or some staff members to follow up on 528 00:32:38,320 --> 00:32:42,520 Speaker 4: his assertion and to direct the IRS to take that action, 529 00:32:42,800 --> 00:32:46,560 Speaker 4: those other people could be prosecuted and be vulnerable. Now, 530 00:32:46,560 --> 00:32:49,280 Speaker 4: the second point you made, which was the White House 531 00:32:49,320 --> 00:32:56,600 Speaker 4: subsequently saying, well, actually, Harvard was being scrutinized even before 532 00:32:56,680 --> 00:33:00,440 Speaker 4: the President spoke, So the President in that sense really 533 00:33:00,480 --> 00:33:07,040 Speaker 4: didn't initiate any particular action against Harvard. That action was 534 00:33:07,160 --> 00:33:11,280 Speaker 4: already occurring. So therefore the seventy two seventeen provision doesn't 535 00:33:11,280 --> 00:33:16,080 Speaker 4: apply well even in that case, which is kind of arguable. 536 00:33:16,120 --> 00:33:20,200 Speaker 4: But even if that's true, then his statements may run 537 00:33:20,200 --> 00:33:23,640 Speaker 4: a foul of a different problem, which is the prohibition 538 00:33:23,760 --> 00:33:29,360 Speaker 4: against disclosing confidential tax return information. Whether a taxpayer is 539 00:33:29,480 --> 00:33:34,800 Speaker 4: being reviewed or audited by the IRS is protected tax 540 00:33:34,840 --> 00:33:39,360 Speaker 4: return information, and under section sixty one oh three, no 541 00:33:39,600 --> 00:33:44,680 Speaker 4: officer or employee of the United States may disclose such 542 00:33:44,800 --> 00:33:50,720 Speaker 4: protected information of any taxpayer. The violation is a misdemeanor, 543 00:33:51,280 --> 00:33:55,880 Speaker 4: and a willful violation is a pelony. Importantly, in addition 544 00:33:55,960 --> 00:34:00,360 Speaker 4: to a fine, imprisonment for up to five years, damages 545 00:34:00,560 --> 00:34:05,720 Speaker 4: and costs, a willful violation results in discharge of the 546 00:34:05,880 --> 00:34:11,000 Speaker 4: violator from federal employment. That's kind of an interesting thought 547 00:34:11,040 --> 00:34:12,360 Speaker 4: in this particular case. 548 00:34:12,400 --> 00:34:14,680 Speaker 1: Would you say, forgetting about you know, whether it's a 549 00:34:14,680 --> 00:34:17,920 Speaker 1: criminal violation or not, would that be a defense for Harvard. 550 00:34:18,160 --> 00:34:20,239 Speaker 1: Let's say the IRS does end up taking away its 551 00:34:20,280 --> 00:34:24,479 Speaker 1: tax exempt status and they end up in litigation, would 552 00:34:24,560 --> 00:34:27,920 Speaker 1: that be a defense for Harvard to say, no one 553 00:34:27,920 --> 00:34:31,480 Speaker 1: in the executive branch is allowed to refer a case 554 00:34:31,560 --> 00:34:32,799 Speaker 1: to the IRS, or. 555 00:34:33,040 --> 00:34:36,320 Speaker 4: Yeah, So that's an interesting question. I'm not sure the answer. 556 00:34:36,600 --> 00:34:39,960 Speaker 4: My inclination would be that it's not a defense, because, 557 00:34:40,480 --> 00:34:45,200 Speaker 4: after all, again, the qualification for exemption is set out 558 00:34:45,200 --> 00:34:49,200 Speaker 4: in the law, and if, in fact, notwithstanding how the 559 00:34:49,280 --> 00:34:53,120 Speaker 4: case came about, that is, whether it was a cabinet 560 00:34:53,120 --> 00:34:57,759 Speaker 4: member who directed, et cetera. Notwithstanding that, if after a 561 00:34:58,000 --> 00:35:01,040 Speaker 4: view of the facts in the law, it was found 562 00:35:01,120 --> 00:35:04,560 Speaker 4: that the Harvard actually did violate one or more of 563 00:35:04,600 --> 00:35:08,000 Speaker 4: the conditions for exemption, it's not clear to me that 564 00:35:08,000 --> 00:35:13,080 Speaker 4: that would somehow absolve Harvard of that misconduct. So, but 565 00:35:13,440 --> 00:35:16,879 Speaker 4: I'm actually not aware of any specific instance where that 566 00:35:17,320 --> 00:35:20,600 Speaker 4: has happened, mainly because the seventy two seventeen has been 567 00:35:20,760 --> 00:35:25,279 Speaker 4: rarely invoked because of course, you know, the presidents and 568 00:35:25,360 --> 00:35:28,680 Speaker 4: vice presidents and those people, they are supposed to be 569 00:35:28,760 --> 00:35:31,279 Speaker 4: aware of it, and they tend to kind of make 570 00:35:31,320 --> 00:35:33,279 Speaker 4: sure that they don't violate that. 571 00:35:33,640 --> 00:35:36,560 Speaker 1: Let's say that this does go as I said to litigation. 572 00:35:37,080 --> 00:35:39,440 Speaker 1: What would be the issue in the case. 573 00:35:40,080 --> 00:35:42,080 Speaker 4: Well, I don't know. I mean, it goes back to 574 00:35:42,120 --> 00:35:45,120 Speaker 4: your original point, which is, what is the basis for 575 00:35:45,280 --> 00:35:49,480 Speaker 4: the assertion that Harvard doesn't qualify for tax exemption. The 576 00:35:49,520 --> 00:35:52,600 Speaker 4: only statement that I've seen so far was the one 577 00:35:52,600 --> 00:35:57,160 Speaker 4: that you stated earlier, which is the President called Harvard 578 00:35:57,360 --> 00:36:00,600 Speaker 4: a political entity, and I don't know what that means. 579 00:36:00,719 --> 00:36:03,680 Speaker 4: I'm not aware of that term being in any aspect 580 00:36:03,719 --> 00:36:06,400 Speaker 4: of the tax law in this area being used. He 581 00:36:06,560 --> 00:36:11,200 Speaker 4: may have been saying they are been active in political campaigning. 582 00:36:11,719 --> 00:36:14,600 Speaker 4: That's about the closest thing I can think of, and 583 00:36:14,880 --> 00:36:18,200 Speaker 4: if that's true, that would be a violation and that 584 00:36:18,280 --> 00:36:22,160 Speaker 4: would cause or might cause Harbor to lose its exemption. 585 00:36:22,360 --> 00:36:25,120 Speaker 4: But of course you'd have to prove that, you know, 586 00:36:25,239 --> 00:36:27,640 Speaker 4: just simply saying it, and I don't know what political 587 00:36:27,760 --> 00:36:31,279 Speaker 4: energy is, but simply saying it doesn't necessarily mean that 588 00:36:31,280 --> 00:36:35,120 Speaker 4: that has been violated. So maybe that's, you know, the 589 00:36:35,239 --> 00:36:38,160 Speaker 4: basis that they would argue, But again, I don't know. 590 00:36:38,200 --> 00:36:42,120 Speaker 4: I haven't really seen any arguments to support why they 591 00:36:42,120 --> 00:36:46,000 Speaker 4: would be challenging the exemption. I wanted to add one 592 00:36:46,040 --> 00:36:50,080 Speaker 4: additional thing because it's something that I think is particularly 593 00:36:50,400 --> 00:36:54,840 Speaker 4: applicable or maybe particularly applicable in this case, and that 594 00:36:54,920 --> 00:36:58,440 Speaker 4: I haven't seen it mentioned. If the President, like his 595 00:36:58,520 --> 00:37:02,520 Speaker 4: apparent use of tariffs, is treating his claims against Harvard 596 00:37:03,200 --> 00:37:07,839 Speaker 4: as part of a larger transaction to achieve some broader objective, 597 00:37:08,239 --> 00:37:12,160 Speaker 4: then he and his cabinet members and other executive manch 598 00:37:12,200 --> 00:37:17,719 Speaker 4: assistants should be aware of an anti extortion provision that's 599 00:37:17,760 --> 00:37:21,520 Speaker 4: also in the tax law. This is section seventy two fourteen. 600 00:37:22,040 --> 00:37:26,000 Speaker 4: Under that provision, it's a felony for any officer or 601 00:37:26,040 --> 00:37:29,799 Speaker 4: employee of the United States, in connection with any revenue law, 602 00:37:30,160 --> 00:37:35,600 Speaker 4: to demand, accept or attempt to collect, directly or indirectly 603 00:37:36,400 --> 00:37:40,919 Speaker 4: anything of value for the compromise or settlement of any 604 00:37:41,080 --> 00:37:46,000 Speaker 4: charge or complaint for any violation or alleged violation of 605 00:37:46,080 --> 00:37:51,440 Speaker 4: the revenue laws, except is expressly authorized by law. So, 606 00:37:51,640 --> 00:37:56,320 Speaker 4: for example, if threatening Harvard's taxis and status is really 607 00:37:56,360 --> 00:38:00,359 Speaker 4: simply a way to get Harvard to change of its 608 00:38:00,440 --> 00:38:06,120 Speaker 4: practices and policies, perhaps it's dei policies if you will, 609 00:38:06,760 --> 00:38:10,440 Speaker 4: that have nothing to do with tax exemption, then this 610 00:38:10,560 --> 00:38:13,799 Speaker 4: provision might apply because it would be a form of 611 00:38:13,920 --> 00:38:18,280 Speaker 4: using the revenue laws to extort some other thing of value. 612 00:38:18,520 --> 00:38:22,600 Speaker 4: The penalty in that case is again a fine, imprisonment 613 00:38:22,680 --> 00:38:28,640 Speaker 4: for up to five years, damages, costs, and again discharge 614 00:38:28,680 --> 00:38:34,080 Speaker 4: from office. So anybody, perhaps other than the president would 615 00:38:34,120 --> 00:38:40,160 Speaker 4: be potentially vulnerable for that penalty. My own guess, and 616 00:38:40,239 --> 00:38:42,560 Speaker 4: it's just a guess in this case, is that it 617 00:38:42,840 --> 00:38:46,600 Speaker 4: would never come to that. That is my guess is 618 00:38:46,719 --> 00:38:50,399 Speaker 4: that this issue would get resolved in some other way, 619 00:38:50,520 --> 00:38:54,319 Speaker 4: whether Harvard would concede some things, or whether the White 620 00:38:54,360 --> 00:38:58,239 Speaker 4: House would back off on something. I frankly don't think 621 00:38:58,280 --> 00:39:03,120 Speaker 4: it's credible to think that exemption would be taken away, 622 00:39:03,280 --> 00:39:07,919 Speaker 4: but again, I certainly haven't delved into all of their activities. 623 00:39:08,160 --> 00:39:10,759 Speaker 1: There's a lot going on between Trump and Harvard, so 624 00:39:11,280 --> 00:39:15,520 Speaker 1: perhaps this one will never come to fruition. Thanks so much, George. 625 00:39:15,960 --> 00:39:19,719 Speaker 1: That's George Gin, emeritus law professor at the University of Virginia, 626 00:39:20,800 --> 00:39:23,120 Speaker 1: and that's it for this edition of the Bloomberg Law Show. 627 00:39:23,440 --> 00:39:25,799 Speaker 1: Remember you can always get the latest legal news on 628 00:39:25,840 --> 00:39:30,120 Speaker 1: our Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify, 629 00:39:30,320 --> 00:39:35,360 Speaker 1: and at www dot Bloomberg dot com, slash podcast Slash Law, 630 00:39:35,760 --> 00:39:38,320 Speaker 1: and remember to tune into The Bloomberg Law Show, every 631 00:39:38,400 --> 00:39:42,280 Speaker 1: weeknight at ten pm Wall Street Time. I'm June Grosso 632 00:39:42,440 --> 00:39:44,040 Speaker 1: and you're listening to Bloomberg