1 00:00:03,200 --> 00:00:08,000 Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio. 2 00:00:10,880 --> 00:00:13,399 Speaker 2: We will hear argument this morning in case twenty three, 3 00:00:13,520 --> 00:00:16,280 Speaker 2: nine thirty nine Trump versus United States. 4 00:00:16,680 --> 00:00:19,520 Speaker 3: It was a historic day at the Supreme Court. For 5 00:00:19,600 --> 00:00:23,520 Speaker 3: the first time, the justices were considering whether former presidents 6 00:00:23,680 --> 00:00:28,000 Speaker 3: have immunity from prosecution for actions they took while in office, 7 00:00:28,480 --> 00:00:32,560 Speaker 3: a question they've never needed to answer before. Donald Trump 8 00:00:32,600 --> 00:00:36,839 Speaker 3: claims he has absolute presidential immunity and that Special counsel 9 00:00:37,000 --> 00:00:40,199 Speaker 3: Jack Smith can't try him for trying to overturn his 10 00:00:40,320 --> 00:00:43,680 Speaker 3: twenty twenty election loss. But Smith says no one is 11 00:00:43,720 --> 00:00:47,560 Speaker 3: above the law. During oral arguments, the liberal and conservative 12 00:00:47,840 --> 00:00:52,360 Speaker 3: justices seem to have different concerns. The conservatives, like Justice 13 00:00:52,400 --> 00:00:57,000 Speaker 3: Samuel Alito, were concerned that presidents without immunity would be 14 00:00:57,080 --> 00:01:01,800 Speaker 3: subjected to abusive prosecutions after lee office, while the liberals, 15 00:01:01,880 --> 00:01:05,920 Speaker 3: like Justice Katanji Brown Jackson, we're concerned that presidents with 16 00:01:06,040 --> 00:01:09,920 Speaker 3: immunity would be emboldened to commit crimes while in office. 17 00:01:10,880 --> 00:01:12,760 Speaker 1: I mean, the presidents have to make a lot of 18 00:01:12,760 --> 00:01:17,039 Speaker 1: tough decisions about enforcing the law, and they have to 19 00:01:17,040 --> 00:01:21,319 Speaker 1: make decisions about questions that are unsettled and they have 20 00:01:21,400 --> 00:01:24,959 Speaker 1: to make decisions based on the information that's available. Do 21 00:01:25,000 --> 00:01:27,959 Speaker 1: you really did I understand you to say, well, you know, 22 00:01:28,040 --> 00:01:29,880 Speaker 1: if he makes a mistake, he makes a mistake, he 23 00:01:30,000 --> 00:01:33,440 Speaker 1: subject to the criminal laws just like anybody else. You 24 00:01:33,440 --> 00:01:37,920 Speaker 1: don't think he's in a special as a peculiarly precarious position. 25 00:01:39,600 --> 00:01:40,640 Speaker 4: You seem to be worried. 26 00:01:40,440 --> 00:01:43,600 Speaker 5: About the president being chilled. I think that we would 27 00:01:43,640 --> 00:01:47,960 Speaker 5: have a really significant opposite problem if the president wasn't chilled. 28 00:01:48,240 --> 00:01:52,080 Speaker 5: If someone with those kinds of powers, the most powerful 29 00:01:52,080 --> 00:01:56,240 Speaker 5: person in the world, with the greatest amount of authority, 30 00:01:57,000 --> 00:02:00,280 Speaker 5: could go into office knowing that there would be no 31 00:02:00,880 --> 00:02:05,880 Speaker 5: potential penalty for committing crimes. I'm trying to understand what 32 00:02:05,960 --> 00:02:11,239 Speaker 5: the disincentive is from turning the Oval office into the 33 00:02:12,240 --> 00:02:14,520 Speaker 5: seat of criminal activity in this country. 34 00:02:14,919 --> 00:02:19,280 Speaker 3: Considering the Conservative's questions during the oral arguments, it appears 35 00:02:19,320 --> 00:02:23,120 Speaker 3: that Trump's trial for election interference is unlikely to take 36 00:02:23,160 --> 00:02:26,600 Speaker 3: place before the election, and that delay is certainly a 37 00:02:26,639 --> 00:02:31,000 Speaker 3: win for Trump. Joining me is constitutional law expert Michael Dorf, 38 00:02:31,040 --> 00:02:35,000 Speaker 3: a professor at Cornell Law School. Mike, these oral arguments 39 00:02:35,000 --> 00:02:37,920 Speaker 3: seemed to be all over the place. What was your 40 00:02:38,000 --> 00:02:39,480 Speaker 3: general impression. 41 00:02:39,400 --> 00:02:42,360 Speaker 6: So I was surprised that I was surprised, And what 42 00:02:42,400 --> 00:02:46,400 Speaker 6: I mean by that is I have long regarded Trump's 43 00:02:46,440 --> 00:02:52,240 Speaker 6: arguments here as pretty and substantial, and therefore I was 44 00:02:52,520 --> 00:02:57,760 Speaker 6: surprised at how seriously the Court was taking it. But 45 00:02:57,880 --> 00:03:01,920 Speaker 6: I should be surprised at myri because they set the 46 00:03:02,000 --> 00:03:06,239 Speaker 6: case for briefing and full oral argument a while back. 47 00:03:06,320 --> 00:03:09,919 Speaker 6: That means that at least four justices thought that there 48 00:03:10,000 --> 00:03:14,320 Speaker 6: was enough here to warrant plenary consideration, rather than simply 49 00:03:14,400 --> 00:03:16,880 Speaker 6: disposing of it in the way that Jack Smith had 50 00:03:16,880 --> 00:03:21,920 Speaker 6: asked them to. Having said that, I'll add that I 51 00:03:22,320 --> 00:03:26,520 Speaker 6: was at least a little bit pleased that nobody seemed 52 00:03:26,720 --> 00:03:31,840 Speaker 6: especially taken by what I regard as the weakest of 53 00:03:31,919 --> 00:03:38,240 Speaker 6: Trump's argument, which is this notion that the impeachment clause requires, 54 00:03:38,760 --> 00:03:43,400 Speaker 6: as a precondition for prosecuting a former president that that 55 00:03:43,440 --> 00:03:47,120 Speaker 6: former president have been impeached and removed. But that was 56 00:03:47,160 --> 00:03:50,560 Speaker 6: about all that pleased me, because there were so many other, 57 00:03:51,160 --> 00:03:56,120 Speaker 6: in my view, very implausible claims that were given serious credence. 58 00:03:56,120 --> 00:04:00,920 Speaker 6: So you had Justice Gorsuch and Justice Alito is Thomas 59 00:04:01,000 --> 00:04:07,480 Speaker 6: asking questions based on hypothetical examples involving, you know, a 60 00:04:07,560 --> 00:04:13,000 Speaker 6: corrupt Justice Department in the future, about planning coup overseas, 61 00:04:13,080 --> 00:04:16,440 Speaker 6: which was about all sorts of things that are you know, 62 00:04:16,520 --> 00:04:20,040 Speaker 6: potentially troubling if they were to ariize and ignoring the 63 00:04:20,080 --> 00:04:21,719 Speaker 6: real thing that just happened. 64 00:04:22,080 --> 00:04:25,279 Speaker 3: It struck me as well because several of the justices, 65 00:04:25,360 --> 00:04:29,120 Speaker 3: and I think Alito, Kavanaugh and Gorsuch said, you know, 66 00:04:29,160 --> 00:04:32,279 Speaker 3: I'm not really concerned about the facts here, right, We're 67 00:04:32,279 --> 00:04:35,880 Speaker 3: concerned about hampering the power of future president Justice. Course, 68 00:04:35,920 --> 00:04:38,960 Speaker 3: it said, we're writing an opinion here for the ages. 69 00:04:39,440 --> 00:04:43,120 Speaker 6: Yes, and that is a fair point in general. Right, 70 00:04:43,240 --> 00:04:47,560 Speaker 6: in any particular case, the Supreme Court isn't merely resolving 71 00:04:47,640 --> 00:04:50,960 Speaker 6: the case. It's also making law that will apply in 72 00:04:51,040 --> 00:04:54,720 Speaker 6: future cases. But one would think, if ever there is 73 00:04:54,760 --> 00:05:00,960 Speaker 6: an occasion to focus, especially on the particular facts before you, 74 00:05:01,600 --> 00:05:06,240 Speaker 6: it's here where we have an unprecedented set of actions 75 00:05:06,440 --> 00:05:08,880 Speaker 6: at this point, officially only alleged with respect to the 76 00:05:08,920 --> 00:05:13,720 Speaker 6: criminal justice system, but unprecedented actions by a sitting president 77 00:05:13,960 --> 00:05:17,320 Speaker 6: to attempt an overthrow of an election. You know. So, 78 00:05:17,640 --> 00:05:20,279 Speaker 6: I guess it's a little bit like saying, well, you 79 00:05:20,400 --> 00:05:24,960 Speaker 6: don't want to use the fire extinguisher on a grease 80 00:05:25,000 --> 00:05:27,960 Speaker 6: fire in your kitchen because you know it could damage 81 00:05:28,200 --> 00:05:30,520 Speaker 6: the wall. Yeah, it could damage the wall. But if 82 00:05:30,520 --> 00:05:32,039 Speaker 6: you don't use it, now, the whole house is going 83 00:05:32,080 --> 00:05:35,680 Speaker 6: to go up on fire. The focus on these remote 84 00:05:35,760 --> 00:05:41,040 Speaker 6: hypotheticals at the expense of the very substantial damage in 85 00:05:41,080 --> 00:05:43,839 Speaker 6: the here and now is, I guess the most polite 86 00:05:43,880 --> 00:05:46,799 Speaker 6: way I could say it is misguided, very polite. 87 00:05:46,960 --> 00:05:52,440 Speaker 3: So did all or most of the justices reject or 88 00:05:52,839 --> 00:05:59,040 Speaker 3: express skepticism about Trump's sweeping claims of absolute presidential immunity. 89 00:05:59,440 --> 00:06:01,960 Speaker 6: I think that that's right, with the possible exception of 90 00:06:02,080 --> 00:06:04,840 Speaker 6: Justice Thomas. It's not that Justice Thomas accepted it, but 91 00:06:04,880 --> 00:06:07,799 Speaker 6: he didn't really say anything about it. He seemed interested 92 00:06:08,040 --> 00:06:13,680 Speaker 6: in the difference between personal and official actions, and that 93 00:06:14,000 --> 00:06:17,880 Speaker 6: was part of the theory of Trump's lawyer, mister Souer anyway, 94 00:06:18,000 --> 00:06:21,279 Speaker 6: So you know, it's hard to say I think there 95 00:06:21,360 --> 00:06:23,440 Speaker 6: was something misleading about the argument if you weren't paying 96 00:06:23,440 --> 00:06:27,480 Speaker 6: close attention. That is, you know, accepting the framing of well, 97 00:06:27,480 --> 00:06:31,000 Speaker 6: we need to distinguish between actions that are in an 98 00:06:31,040 --> 00:06:34,160 Speaker 6: official capacity versus those that are in a personal capacity, 99 00:06:34,440 --> 00:06:38,760 Speaker 6: could be consistent with the extreme version of Trump's theory, 100 00:06:39,240 --> 00:06:42,159 Speaker 6: because of course even the extreme version says, well, you know, 101 00:06:42,200 --> 00:06:45,440 Speaker 6: and for prosecuting the president for a murder he committed 102 00:06:45,480 --> 00:06:48,440 Speaker 6: while president, but as part of a love triangle, and 103 00:06:48,560 --> 00:06:51,120 Speaker 6: that would be permissible, although I heard sours say, well, 104 00:06:51,160 --> 00:06:53,799 Speaker 6: it would be impermissible if he did it by having 105 00:06:53,839 --> 00:06:57,080 Speaker 6: someone in the FBI do it for him, because giving 106 00:06:57,320 --> 00:06:59,840 Speaker 6: orders to the FBI is an official function. 107 00:07:00,400 --> 00:07:02,839 Speaker 3: So, as you mentioned, there were all these hypotheticals to 108 00:07:02,920 --> 00:07:07,160 Speaker 3: test whether a president's act would be considered official or private. 109 00:07:07,600 --> 00:07:10,680 Speaker 3: But Justice amy Cony Barrett actually read some of the 110 00:07:10,840 --> 00:07:14,280 Speaker 3: charges and asked Trump's attorney whether they were official or 111 00:07:14,320 --> 00:07:15,360 Speaker 3: private acts. 112 00:07:15,680 --> 00:07:19,000 Speaker 7: Petitioner conspired with another private attorney who caused the filing 113 00:07:19,040 --> 00:07:21,920 Speaker 7: in court of a verification signed by petitioner that contained 114 00:07:21,920 --> 00:07:25,280 Speaker 7: false allegations to support a challenge. 115 00:07:24,560 --> 00:07:27,720 Speaker 3: So do you think the decision will come down to 116 00:07:27,800 --> 00:07:31,400 Speaker 3: the distinction between official acts and private acts? 117 00:07:31,880 --> 00:07:35,120 Speaker 6: So? I think that's probably the most likely way to 118 00:07:35,200 --> 00:07:40,800 Speaker 6: get to five votes. I suspect that if there is 119 00:07:40,880 --> 00:07:46,120 Speaker 6: a five justice majority for a version of that question, 120 00:07:46,720 --> 00:07:52,760 Speaker 6: that still permits the case to go forward. Substantially. The 121 00:07:52,960 --> 00:07:56,800 Speaker 6: five main votes are the three Democratic appointees, Chief Justice 122 00:07:56,880 --> 00:08:00,480 Speaker 6: Roberts and Justice Barrett. It's possible they would take just 123 00:08:00,480 --> 00:08:02,680 Speaker 6: to score sitch on that, but maybe not. I thought 124 00:08:02,680 --> 00:08:05,280 Speaker 6: that of the Republican appointees, Justice Barrett was the one 125 00:08:05,320 --> 00:08:09,240 Speaker 6: who seemed to be taking the prosecution the most seriously, right, 126 00:08:09,280 --> 00:08:12,080 Speaker 6: because she wanted to know whether there would be a 127 00:08:12,120 --> 00:08:15,800 Speaker 6: way to articulate some tests that gives some kind of 128 00:08:16,040 --> 00:08:21,120 Speaker 6: immunity for some core of official acts, but still have 129 00:08:21,440 --> 00:08:25,040 Speaker 6: the case move forward quickly. I think that's a nice 130 00:08:25,080 --> 00:08:27,560 Speaker 6: wish if that's what she's sincerely trying to do. I 131 00:08:27,640 --> 00:08:31,040 Speaker 6: admire her for doing so, but I think that basically 132 00:08:31,160 --> 00:08:33,839 Speaker 6: the court, you know, put the kaibas on this prosecution 133 00:08:33,960 --> 00:08:36,120 Speaker 6: when they set it for oral argument. We're not going 134 00:08:36,160 --> 00:08:39,200 Speaker 6: to get an opinion, probably not until late June. You know, 135 00:08:39,200 --> 00:08:41,600 Speaker 6: you're not going to get your selection immediately. Right. The 136 00:08:41,720 --> 00:08:45,040 Speaker 6: earliest you get a trial under the best of circumstances 137 00:08:45,040 --> 00:08:48,120 Speaker 6: is October, and that's just not going to happen. The 138 00:08:48,200 --> 00:08:50,440 Speaker 6: judge is not going to schedule a trial for the 139 00:08:50,520 --> 00:08:54,520 Speaker 6: month before the presidential election. So it almost doesn't matter 140 00:08:54,920 --> 00:08:58,920 Speaker 6: unless right Trump loses the election and then the case 141 00:08:58,960 --> 00:09:01,319 Speaker 6: goes forward during the second by an administration. 142 00:09:01,920 --> 00:09:05,160 Speaker 3: Besides the official versus private is there another way you 143 00:09:05,200 --> 00:09:08,480 Speaker 3: see them deciding this, well, I see other obstacles. 144 00:09:08,480 --> 00:09:11,160 Speaker 6: I mean, there were various points during the oral argument 145 00:09:11,200 --> 00:09:14,080 Speaker 6: where some of the justices suggested that the former president 146 00:09:14,080 --> 00:09:17,600 Speaker 6: can't be prosecuted under any statute that doesn't specifically list 147 00:09:17,679 --> 00:09:20,320 Speaker 6: the president, right, So that if a statute says anybody 148 00:09:20,360 --> 00:09:23,240 Speaker 6: who commits murder, you know, shall be subject to prosecution, 149 00:09:23,480 --> 00:09:25,640 Speaker 6: that doesn't include the president because it's said anybody. But 150 00:09:25,720 --> 00:09:28,080 Speaker 6: you know, the President isn't anybody. He's the President. So 151 00:09:28,320 --> 00:09:30,240 Speaker 6: you know, I don't think there are five votes for 152 00:09:30,320 --> 00:09:32,840 Speaker 6: saying that, but I think someone might be attracted to that. 153 00:09:33,080 --> 00:09:36,360 Speaker 6: Justice Thomas at one point early in the argument suggested 154 00:09:36,400 --> 00:09:40,160 Speaker 6: that the very existence of a special prosecutor might be unconstitutional. 155 00:09:40,400 --> 00:09:43,880 Speaker 6: Justice Kavanaugh had, you know, a bizarre couple of minutes 156 00:09:43,920 --> 00:09:46,200 Speaker 6: when he's just sort of giving a dramatic reading of 157 00:09:46,320 --> 00:09:49,360 Speaker 6: Justice Scalia's descent from Morrison against Olson, which also was 158 00:09:49,440 --> 00:09:51,960 Speaker 6: critical of the Independent Council. So, you know, there's a 159 00:09:51,960 --> 00:09:54,760 Speaker 6: whole lot of dirt that was kind of just kicked up. 160 00:09:54,960 --> 00:09:58,520 Speaker 6: And I think it's unlikely that many of those things 161 00:09:58,640 --> 00:10:03,319 Speaker 6: ends up commanding a majority, but it will likely delay 162 00:10:03,360 --> 00:10:05,880 Speaker 6: the release of the opinion until the very last day 163 00:10:05,920 --> 00:10:09,200 Speaker 6: of the term, and then whatever additional procedure is called 164 00:10:09,200 --> 00:10:11,880 Speaker 6: for is going to add further delay. So again I'm 165 00:10:11,960 --> 00:10:16,160 Speaker 6: less focused on the exact outcome than I am on 166 00:10:16,440 --> 00:10:19,640 Speaker 6: the delay, because I don't think there are five votes. 167 00:10:19,640 --> 00:10:22,400 Speaker 6: It may not even be one vote for saying that 168 00:10:22,480 --> 00:10:25,080 Speaker 6: the president is simply absolutely immune. But I do think 169 00:10:25,120 --> 00:10:27,640 Speaker 6: there are at least five votes for some kind of 170 00:10:27,679 --> 00:10:31,559 Speaker 6: a test that further delays trial and means it doesn't 171 00:10:31,559 --> 00:10:33,320 Speaker 6: happen until after the election, if at all. 172 00:10:33,679 --> 00:10:36,319 Speaker 3: The Supreme Court has this case, the case over the 173 00:10:36,400 --> 00:10:40,840 Speaker 3: January sixth obstruction charge, and the already decided case over 174 00:10:40,880 --> 00:10:44,199 Speaker 3: the Colorado ballot. This court seems to be more involved 175 00:10:44,280 --> 00:10:48,920 Speaker 3: in a presidential election than any court since bushby Gore. Well. 176 00:10:48,920 --> 00:10:51,520 Speaker 3: At the same time, it has the lowest public approval. 177 00:10:51,840 --> 00:10:53,960 Speaker 3: Is that something that justices consider? 178 00:10:54,600 --> 00:10:57,439 Speaker 6: So I guess I would distinguish some of the cases. 179 00:10:57,480 --> 00:11:00,480 Speaker 6: Although I think they got it wrong in the Colorado case. 180 00:11:00,679 --> 00:11:03,720 Speaker 6: I think it would have been irresponsible to have left 181 00:11:03,920 --> 00:11:08,520 Speaker 6: the fourteenth Amendent Section three question just to each of 182 00:11:08,559 --> 00:11:11,200 Speaker 6: the fifty states and local election boards and so forth. 183 00:11:11,200 --> 00:11:12,840 Speaker 6: I think what they should have done was take the 184 00:11:12,880 --> 00:11:15,520 Speaker 6: case and agree with the Colorado Supreme Court, but you 185 00:11:15,600 --> 00:11:19,480 Speaker 6: did sort of need a national determination with respect to 186 00:11:19,559 --> 00:11:23,320 Speaker 6: whether Trump committed insurrection within the meaning of Section three 187 00:11:23,320 --> 00:11:26,760 Speaker 6: of the fourteenth Amendment. With respect to this case, I 188 00:11:26,840 --> 00:11:30,760 Speaker 6: do think that what they've done does, at the very 189 00:11:30,840 --> 00:11:36,160 Speaker 6: least unnecessarily and you know, dispositively delay any kind of 190 00:11:36,160 --> 00:11:40,240 Speaker 6: a prosecution. As far as you know, public opinion, I 191 00:11:40,320 --> 00:11:45,360 Speaker 6: think it hasn't been true since the appointment of Justice 192 00:11:45,400 --> 00:11:50,400 Speaker 6: Cony Barrett that the court really cares about that. I mean, 193 00:11:50,400 --> 00:11:52,480 Speaker 6: I think that's something that keeps us as Roberts has 194 00:11:52,679 --> 00:11:55,400 Speaker 6: long cared about. I think he now realizes that he's 195 00:11:55,440 --> 00:11:58,080 Speaker 6: lost that battle, and even if he still wants to 196 00:11:58,200 --> 00:12:01,440 Speaker 6: fight for the Court's standing, he's going to lose. And 197 00:12:01,520 --> 00:12:03,600 Speaker 6: so they're just going to do what they think is 198 00:12:03,600 --> 00:12:05,880 Speaker 6: the right thing to do. And you know, I suspect 199 00:12:06,000 --> 00:12:09,160 Speaker 6: that they think they're just following the law, even just 200 00:12:09,200 --> 00:12:11,880 Speaker 6: as Alido I believe believes he is just following. 201 00:12:11,520 --> 00:12:14,600 Speaker 3: The law, though while ignoring a lot of precedent. Thanks 202 00:12:14,640 --> 00:12:17,840 Speaker 3: so much, Mike. That's Cornell Law School professor Michael Dorf. 203 00:12:18,960 --> 00:12:22,440 Speaker 3: While in DC this week, the Supreme Court was considering 204 00:12:22,520 --> 00:12:27,080 Speaker 3: Donald Trump's claims of presidential immunity from criminal prosecution for 205 00:12:27,160 --> 00:12:31,560 Speaker 3: election interference. In Manhattan, Donald Trump was the defendant in 206 00:12:31,640 --> 00:12:34,560 Speaker 3: the first criminal trial of a former president of the 207 00:12:34,640 --> 00:12:38,120 Speaker 3: United States. Trump is accused of trying to corrupt the 208 00:12:38,200 --> 00:12:43,120 Speaker 3: twenty sixteen presidential election by falsifying business records to cover 209 00:12:43,240 --> 00:12:47,400 Speaker 3: up a hush money payment. In opening statements, prosecutors called 210 00:12:47,440 --> 00:12:51,880 Speaker 3: it a planned, coordinated, long running conspiracy to influence the 211 00:12:51,880 --> 00:12:55,480 Speaker 3: twenty sixteen election, while the defense attorney said Trump had 212 00:12:55,559 --> 00:12:59,080 Speaker 3: nothing to do with the alleged false business records, which 213 00:12:59,120 --> 00:13:02,640 Speaker 3: by the way, were in false. Trump echoed that outside 214 00:13:02,640 --> 00:13:05,400 Speaker 3: the courthouse, saying it was a case about a payment 215 00:13:05,440 --> 00:13:08,240 Speaker 3: to a lawyer that was listed as a legal expense. 216 00:13:09,000 --> 00:13:11,280 Speaker 8: What else would you call it? Actually, nobody's been able 217 00:13:11,320 --> 00:13:13,160 Speaker 8: to say. What are you supposed to call it? If 218 00:13:13,160 --> 00:13:17,480 Speaker 8: a lawyer puts it a bill or an invoice, and 219 00:13:17,559 --> 00:13:19,480 Speaker 8: you pay the bill, and in the book it's a 220 00:13:19,520 --> 00:13:22,720 Speaker 8: little line. That's a very small little line. I don't 221 00:13:22,720 --> 00:13:24,360 Speaker 8: know if you if you've been right more than two ords, 222 00:13:24,400 --> 00:13:27,400 Speaker 8: it sounds like you could tell a life story. They 223 00:13:27,440 --> 00:13:29,360 Speaker 8: marked it down to a legal expense. This is what 224 00:13:29,440 --> 00:13:30,479 Speaker 8: I got in dited. 225 00:13:30,200 --> 00:13:34,480 Speaker 3: Though, joining me to discuss trial tactics. Is former federal 226 00:13:34,480 --> 00:13:38,120 Speaker 3: prosecutor Jeff Psi Jeff in the opening statements, While the 227 00:13:38,160 --> 00:13:42,800 Speaker 3: prosecutor is describing election fraud, the defense attorney is describing 228 00:13:42,840 --> 00:13:46,560 Speaker 3: bookkeeping errors. Todd Bland said, what on earth is a crime? 229 00:13:46,880 --> 00:13:49,959 Speaker 3: The thirty four counts are really just thirty four pieces 230 00:13:50,000 --> 00:13:50,520 Speaker 3: of paper. 231 00:13:50,840 --> 00:13:53,839 Speaker 4: It's an attempt to try to turn a three dimensional 232 00:13:53,920 --> 00:13:58,000 Speaker 4: case into a one dimensional or two dimensional case. This 233 00:13:58,200 --> 00:14:01,240 Speaker 4: is always going to be a pitched back between an 234 00:14:01,280 --> 00:14:04,160 Speaker 4: issue of paper or an issue of substance, and you 235 00:14:04,240 --> 00:14:07,160 Speaker 4: see it in every kind of fraud case that exists. 236 00:14:07,200 --> 00:14:10,720 Speaker 4: In this case, obviously dealing with a former president is 237 00:14:10,800 --> 00:14:14,400 Speaker 4: no different. The defense's job front and center is going 238 00:14:14,440 --> 00:14:17,600 Speaker 4: to be presenting to the jury the idea that at 239 00:14:17,720 --> 00:14:23,040 Speaker 4: most this is a small sea crime of paper. It 240 00:14:23,120 --> 00:14:25,360 Speaker 4: is about moving things from the left side of the 241 00:14:25,440 --> 00:14:28,360 Speaker 4: desk to the right side, and jury, do you want 242 00:14:28,400 --> 00:14:31,760 Speaker 4: to be the ones who potentially takes someone's liberty away 243 00:14:31,800 --> 00:14:34,320 Speaker 4: because he didn't move the paper on the desk quite 244 00:14:34,320 --> 00:14:36,840 Speaker 4: the right way. That's part of the reason why you 245 00:14:36,880 --> 00:14:40,720 Speaker 4: saw the government and their opening statement start not just 246 00:14:40,840 --> 00:14:45,080 Speaker 4: with the idea that we're talking about thirty four felony charges, 247 00:14:45,440 --> 00:14:48,360 Speaker 4: but that we're talking writ large like take a step 248 00:14:48,480 --> 00:14:52,400 Speaker 4: back about election interference. And then you also heard that 249 00:14:52,480 --> 00:14:55,560 Speaker 4: phrase in the opening statement where the prosecutor talks about 250 00:14:55,560 --> 00:15:00,240 Speaker 4: the idea of the former president lying quote over and 251 00:15:00,480 --> 00:15:04,040 Speaker 4: over and over again. They're just words, of course that 252 00:15:04,120 --> 00:15:08,040 Speaker 4: the prosecutor is saying, but there is a message behind it, 253 00:15:08,080 --> 00:15:11,080 Speaker 4: which is this isn't just about paper. This is also 254 00:15:11,240 --> 00:15:15,040 Speaker 4: about the core things that no one likes lying and 255 00:15:15,160 --> 00:15:16,920 Speaker 4: lying about something that matters. 256 00:15:17,320 --> 00:15:20,760 Speaker 3: And the prosecution in the opening said it's about a 257 00:15:20,760 --> 00:15:25,800 Speaker 3: criminal conspiracy and a cover up. He's not charged with conspiracy. 258 00:15:26,320 --> 00:15:29,360 Speaker 3: Is the prosecution setting the bar too high for itself? 259 00:15:29,440 --> 00:15:33,160 Speaker 4: I'll tell you, Being a prosecutor and bringing cases, especially 260 00:15:33,240 --> 00:15:36,880 Speaker 4: big ones like this are complicated because there is a 261 00:15:37,080 --> 00:15:42,200 Speaker 4: mission creep desire, sometimes sometimes unintentional by the way, to 262 00:15:42,400 --> 00:15:45,880 Speaker 4: try to make the case too big, and often the 263 00:15:45,960 --> 00:15:49,360 Speaker 4: approach that prosecutors try to take, and frankly need to 264 00:15:49,400 --> 00:15:52,160 Speaker 4: take in many instances is to try to avoid the 265 00:15:52,200 --> 00:15:55,680 Speaker 4: mission creep and keep the cases as tight and small 266 00:15:55,760 --> 00:15:59,720 Speaker 4: as possible. Not small in terms of substance, but small 267 00:15:59,800 --> 00:16:03,280 Speaker 4: in terms of what you're asking a juror to put 268 00:16:03,320 --> 00:16:06,360 Speaker 4: in her brain. Over the course of six weeks, there 269 00:16:06,440 --> 00:16:12,600 Speaker 4: is going to be an extraordinary amount of information, testimony, documents, pictures, 270 00:16:13,160 --> 00:16:15,680 Speaker 4: And I don't care how many notes a juror takes. 271 00:16:16,080 --> 00:16:19,760 Speaker 4: It is difficult to keep all of that package together cleanly. 272 00:16:19,840 --> 00:16:22,120 Speaker 4: And I don't care how great the closing argument is, 273 00:16:22,200 --> 00:16:23,320 Speaker 4: it's difficult to do. 274 00:16:23,800 --> 00:16:23,920 Speaker 9: So. 275 00:16:24,040 --> 00:16:28,479 Speaker 4: The bigger a case becomes, it can create lots of variables, 276 00:16:28,600 --> 00:16:32,520 Speaker 4: and variables are ultimately the enemy for a prosecutor. 277 00:16:33,040 --> 00:16:36,160 Speaker 3: So there is the Michael Cohen problem, which I'll call 278 00:16:36,200 --> 00:16:38,520 Speaker 3: the Michael Cohen problem. And he's going to be the 279 00:16:38,560 --> 00:16:41,640 Speaker 3: star witness for the prosecution. The defense said he was 280 00:16:41,720 --> 00:16:45,280 Speaker 3: obsessed with President Trump, he was disbarred, He's a convicted 281 00:16:45,320 --> 00:16:48,520 Speaker 3: felon and a convicted perjurer. How difficult is it going 282 00:16:48,560 --> 00:16:51,600 Speaker 3: to be for the prosecution to make Cohen into a 283 00:16:51,640 --> 00:16:52,640 Speaker 3: believable witness. 284 00:16:53,160 --> 00:16:56,080 Speaker 4: So, you know, to the point about trying to make 285 00:16:56,120 --> 00:16:59,440 Speaker 4: a case too big, I think that principle applies a 286 00:16:59,520 --> 00:17:02,120 Speaker 4: special in a circumstance where you do have what I 287 00:17:02,120 --> 00:17:06,280 Speaker 4: think you accurately described as the star witness. The reality 288 00:17:06,400 --> 00:17:10,280 Speaker 4: is Michael Cohen is a person who clearly made mistakes. 289 00:17:10,280 --> 00:17:13,159 Speaker 4: We know this because he pleaded guilty to felony offenses. 290 00:17:13,520 --> 00:17:17,240 Speaker 4: If the government attempts to try to do too much, 291 00:17:17,320 --> 00:17:20,880 Speaker 4: which is to say, try to turn Michael Cohen into 292 00:17:20,920 --> 00:17:24,479 Speaker 4: this kind of angelic figure, one who's almost a martyr 293 00:17:24,520 --> 00:17:28,600 Speaker 4: of sorts, it can backfire because there is a certain 294 00:17:28,640 --> 00:17:32,040 Speaker 4: degree to which when a jury is listening and hearing 295 00:17:32,080 --> 00:17:36,360 Speaker 4: and watching evidence, they're paying attention to that very basic 296 00:17:36,520 --> 00:17:40,640 Speaker 4: normal person emotion, which is, do I just trust the 297 00:17:40,680 --> 00:17:43,480 Speaker 4: information this person is giving me. So there is something 298 00:17:43,520 --> 00:17:46,720 Speaker 4: to be said for trying to present a witness, especially 299 00:17:46,760 --> 00:17:51,160 Speaker 4: a flawed one, and frankly, most witnesses and people are flawed, 300 00:17:51,800 --> 00:17:54,480 Speaker 4: presenting the information in such a way that says, this 301 00:17:54,520 --> 00:17:57,439 Speaker 4: is a person who made mistakes, This is a person 302 00:17:57,440 --> 00:18:00,959 Speaker 4: who is coming clean right now. There is no reason 303 00:18:01,040 --> 00:18:05,080 Speaker 4: for this person now to tell you anything but the truth. 304 00:18:05,440 --> 00:18:07,119 Speaker 4: And I think that that's going to be really the 305 00:18:07,200 --> 00:18:09,240 Speaker 4: job that the prosecutor has to undertake. 306 00:18:09,680 --> 00:18:13,159 Speaker 3: David Pecker, the former publisher of the National Choir, was 307 00:18:13,200 --> 00:18:17,360 Speaker 3: the first prosecution witness. Explain why the prosecution put him 308 00:18:17,400 --> 00:18:18,000 Speaker 3: on first. 309 00:18:18,359 --> 00:18:23,000 Speaker 4: The first witness is probably the most important evidentiury step 310 00:18:23,119 --> 00:18:27,119 Speaker 4: that the government makes, because it is literally the very 311 00:18:27,160 --> 00:18:30,600 Speaker 4: first human being who will start presenting what is actually 312 00:18:30,680 --> 00:18:33,840 Speaker 4: evidence to a jury. There is a tendency in a 313 00:18:33,880 --> 00:18:37,280 Speaker 4: case like this that you put the star witness on 314 00:18:37,320 --> 00:18:40,960 Speaker 4: the stand because it allows for two things. One for 315 00:18:41,119 --> 00:18:44,720 Speaker 4: the evidence to come in immediately for the jury, no 316 00:18:44,800 --> 00:18:48,640 Speaker 4: waiting around. But also number two, it allows the government 317 00:18:48,720 --> 00:18:52,800 Speaker 4: to buffer in some other kinds of evidence in case 318 00:18:53,160 --> 00:18:56,119 Speaker 4: the star evidence doesn't come in quite as they expected. 319 00:18:56,600 --> 00:18:59,680 Speaker 4: This is slightly different. It's slightly different for a couple 320 00:18:59,720 --> 00:19:02,919 Speaker 4: of reas, one of which is an important goal that 321 00:19:02,960 --> 00:19:06,520 Speaker 4: the government has is to try to get corroboration in 322 00:19:06,600 --> 00:19:09,440 Speaker 4: place and to try to make sure that they are 323 00:19:09,520 --> 00:19:13,919 Speaker 4: not relying only on Michael Cohen's testimony. And so you 324 00:19:14,040 --> 00:19:16,920 Speaker 4: have someone in the form of David Pecker, who serves 325 00:19:17,000 --> 00:19:20,640 Speaker 4: as a narrator of sorts, who can tell the story 326 00:19:21,119 --> 00:19:24,000 Speaker 4: not in the beginning of time, but in a very 327 00:19:24,080 --> 00:19:27,560 Speaker 4: important snippet of time that will allow the government to 328 00:19:27,640 --> 00:19:31,440 Speaker 4: both go forwards in time and backwards in time. And 329 00:19:31,520 --> 00:19:33,840 Speaker 4: that's where they then slot in Michael Cohen. 330 00:19:34,359 --> 00:19:37,760 Speaker 3: And they have asked Pecker a lot about Michael Cohen's role, 331 00:19:38,080 --> 00:19:41,280 Speaker 3: and it's come out already that Trump was the one 332 00:19:41,320 --> 00:19:43,639 Speaker 3: who set up Cohen as the point man. 333 00:19:43,720 --> 00:19:46,320 Speaker 4: And I got to tell you that was not only 334 00:19:46,480 --> 00:19:49,120 Speaker 4: intentional on the government's part. I think it was an 335 00:19:49,119 --> 00:19:52,440 Speaker 4: important piece of what they're trying to build in their case, 336 00:19:52,480 --> 00:19:55,639 Speaker 4: which is not just this notion of we want to 337 00:19:55,720 --> 00:19:59,480 Speaker 4: corroborate Michael Cohen and bolster this idea that he was 338 00:19:59,480 --> 00:20:04,360 Speaker 4: an important person. They also want to directly insert Donald 339 00:20:04,359 --> 00:20:09,679 Speaker 4: Trump into this conversation through someone other than Michael Cohen. 340 00:20:10,200 --> 00:20:13,760 Speaker 4: That's an important piece because the testimony that the jury 341 00:20:13,800 --> 00:20:17,480 Speaker 4: hears from Michael Cohen is going to rely insignificant part 342 00:20:17,960 --> 00:20:22,200 Speaker 4: on whether the jury trusts the conversations that Michael Cohen 343 00:20:22,240 --> 00:20:26,200 Speaker 4: had with Donald Trump. And that's even putting aside the recording, 344 00:20:26,560 --> 00:20:30,639 Speaker 4: assuming it gets into evidence, You've got the jury having 345 00:20:30,680 --> 00:20:33,840 Speaker 4: to listen to Michael Cohen's testimony. And the only thing 346 00:20:33,920 --> 00:20:38,439 Speaker 4: better than having just Michael Cohen describe a conversation is 347 00:20:38,480 --> 00:20:41,840 Speaker 4: to have an entirely different person say that the conversation 348 00:20:42,080 --> 00:20:45,320 Speaker 4: also happened. And that's why I think you see a 349 00:20:45,400 --> 00:20:49,840 Speaker 4: lot of the descriptions from David Pecker about the conversations 350 00:20:49,880 --> 00:20:52,280 Speaker 4: Donald Trump was in and I think it's going to 351 00:20:52,320 --> 00:20:55,080 Speaker 4: be something that the government continues to utilize for the 352 00:20:55,119 --> 00:20:55,840 Speaker 4: rest of their case. 353 00:20:56,320 --> 00:20:59,960 Speaker 3: Let's talk about Trump taking the stand, and we saw 354 00:21:00,000 --> 00:21:02,240 Speaker 3: what happened in the civil case where he was on 355 00:21:02,280 --> 00:21:05,399 Speaker 3: the Stanford. Also he has against him now the fact 356 00:21:05,480 --> 00:21:07,639 Speaker 3: that the judge is allowing a lot of what the 357 00:21:07,680 --> 00:21:11,400 Speaker 3: prosecution wants to cross examine him. But yet I've heard 358 00:21:11,400 --> 00:21:13,720 Speaker 3: people say, maybe he will take the stand in this, 359 00:21:13,800 --> 00:21:15,639 Speaker 3: Maybe it'll come to a point in the trial where 360 00:21:16,080 --> 00:21:18,040 Speaker 3: that's the only way they have to go. I mean, 361 00:21:18,040 --> 00:21:18,760 Speaker 3: what do you think. 362 00:21:19,240 --> 00:21:22,760 Speaker 4: Sometimes that's the case, and it's happened more than once 363 00:21:22,880 --> 00:21:26,320 Speaker 4: where a defendant has taken the stand and it's changed 364 00:21:26,520 --> 00:21:30,240 Speaker 4: the entire complexion of a case. But the reason why 365 00:21:30,280 --> 00:21:36,320 Speaker 4: there's a loose general rule in criminal prosecutions, in criminal defense, frankly, 366 00:21:36,920 --> 00:21:40,399 Speaker 4: that a defendant should not take the stand is the 367 00:21:40,400 --> 00:21:44,320 Speaker 4: fact that it creates more variability, something that we talked 368 00:21:44,320 --> 00:21:48,840 Speaker 4: about before, and it applies that concept of variability as 369 00:21:48,960 --> 00:21:51,199 Speaker 4: much on the defense side as it does on the 370 00:21:51,240 --> 00:21:54,840 Speaker 4: prosecution side. In this sense, for a defense lawyer to 371 00:21:55,160 --> 00:21:59,119 Speaker 4: allow his client, her client to take the stand, whether 372 00:21:59,240 --> 00:22:01,920 Speaker 4: or not he or she I suppose allows it. The 373 00:22:02,040 --> 00:22:05,280 Speaker 4: variability at play is partly what you said a moment 374 00:22:05,280 --> 00:22:07,879 Speaker 4: ago which is there are a number of things that 375 00:22:08,000 --> 00:22:12,560 Speaker 4: now become part of those items that can cross examine 376 00:22:12,600 --> 00:22:16,199 Speaker 4: a witness. The other issue is that in the event 377 00:22:16,880 --> 00:22:20,320 Speaker 4: that a judge subsequently in the case of a conviction 378 00:22:21,040 --> 00:22:25,000 Speaker 4: at sentencing, finds that the defendant who took the stand 379 00:22:25,280 --> 00:22:29,000 Speaker 4: lied on the stand, that can serve to actually increase 380 00:22:29,440 --> 00:22:33,359 Speaker 4: someone's sentence. So what makes this fundamentally different from a 381 00:22:33,400 --> 00:22:37,200 Speaker 4: civil trial is the fact that now your liberty's at stake. 382 00:22:37,680 --> 00:22:41,239 Speaker 4: That really changes the game rather fundamentally. And so I 383 00:22:41,280 --> 00:22:44,399 Speaker 4: think that the loose general principle of the defendant not 384 00:22:44,560 --> 00:22:49,639 Speaker 4: taking the stand will most likely control at the end 385 00:22:49,680 --> 00:22:51,920 Speaker 4: of the day in this particular trial. But of course 386 00:22:51,920 --> 00:22:54,560 Speaker 4: we're guessing as much as anyone. And I will tell you, 387 00:22:55,119 --> 00:22:58,840 Speaker 4: having done a lot of trials, things change from day 388 00:22:58,880 --> 00:23:02,159 Speaker 4: one to day twenty one, today, thirty one, and somewhere 389 00:23:02,200 --> 00:23:05,439 Speaker 4: in between. Things can change at a moment's notice. And so, 390 00:23:06,359 --> 00:23:10,080 Speaker 4: especially in a situation where the defense has decided not 391 00:23:10,240 --> 00:23:15,080 Speaker 4: to call a client to testify, it's often characterized to 392 00:23:15,200 --> 00:23:18,800 Speaker 4: the jury as we didn't do it because a we 393 00:23:18,880 --> 00:23:22,119 Speaker 4: don't have the burden of proof, and number two, the 394 00:23:22,160 --> 00:23:26,399 Speaker 4: government's case is paltry it's thin, it's lean, they have 395 00:23:26,520 --> 00:23:29,000 Speaker 4: nothing to it. We didn't need to present it anything 396 00:23:29,000 --> 00:23:30,960 Speaker 4: to you, and I think that's what you might see 397 00:23:31,400 --> 00:23:33,919 Speaker 4: in the event they don't put mister Trump on the stand. 398 00:23:34,119 --> 00:23:36,840 Speaker 4: So I mean, this is going to be an interesting ride. 399 00:23:36,960 --> 00:23:39,720 Speaker 4: A lot of people obviously talk about this being some 400 00:23:39,800 --> 00:23:43,439 Speaker 4: kind of novel case, But if the government is doing 401 00:23:43,440 --> 00:23:46,720 Speaker 4: its job, then it is trying to take the novelty 402 00:23:47,000 --> 00:23:49,760 Speaker 4: out of the discussion. And if the defense is doing 403 00:23:49,800 --> 00:23:52,720 Speaker 4: its job, it's going to try to insert a lot 404 00:23:52,760 --> 00:23:57,639 Speaker 4: of this original concepts, the novelty ideas into this because 405 00:23:57,640 --> 00:24:00,960 Speaker 4: that's ultimately I think the battle they want the jury 406 00:24:01,000 --> 00:24:05,679 Speaker 4: to have whether or not this is so extraordinary of 407 00:24:05,720 --> 00:24:09,679 Speaker 4: a case that we don't feel comfortable convicting someone, or 408 00:24:10,440 --> 00:24:14,080 Speaker 4: this is actually a rather standard white collar fraud case. 409 00:24:14,440 --> 00:24:16,119 Speaker 4: We are ready to convict someone. 410 00:24:16,520 --> 00:24:19,679 Speaker 3: I love to discuss trial tactics. Thanks so much, Jeff. 411 00:24:19,880 --> 00:24:23,920 Speaker 3: That's former federal prosecutor Jeff si. The jury heard from 412 00:24:24,000 --> 00:24:27,480 Speaker 3: three witnesses in this first week of trial, and in 413 00:24:27,520 --> 00:24:30,840 Speaker 3: the courtroom listening to them all, Bloomberg Legal reporter Patricia 414 00:24:30,880 --> 00:24:34,160 Speaker 3: Hurtado pat tell us about the first witness, David Pecker, 415 00:24:34,600 --> 00:24:38,000 Speaker 3: the former publisher of the National Inquirer, David Pecker. 416 00:24:37,760 --> 00:24:41,640 Speaker 9: Was an essential witness for prosecutors. He sets the stage 417 00:24:41,800 --> 00:24:45,760 Speaker 9: to describe the backstory to this push money payment that's 418 00:24:45,800 --> 00:24:49,520 Speaker 9: allegedly been made to help Donald Trump buy and very 419 00:24:49,840 --> 00:24:52,800 Speaker 9: salacious stories that he felt could have hurt his campaign 420 00:24:53,119 --> 00:24:56,080 Speaker 9: when you began for president in twenty sixteen. We've all 421 00:24:56,119 --> 00:25:00,199 Speaker 9: seen the supermarket tabloids, but David Pecker is describing a 422 00:25:00,280 --> 00:25:04,399 Speaker 9: whole other world of checkbrook journalists. You know, they would 423 00:25:04,480 --> 00:25:09,480 Speaker 9: pay money to people, including limousine drivers, for stories about celebrities, 424 00:25:09,800 --> 00:25:12,840 Speaker 9: and the number one celebrity in his book was Donald 425 00:25:12,840 --> 00:25:16,600 Speaker 9: Trump because he was so popular with their reader because 426 00:25:16,680 --> 00:25:19,760 Speaker 9: of the Celebrity Apprentice as well as the Apprentice. So 427 00:25:20,080 --> 00:25:23,879 Speaker 9: he described in great detail having these conversations with Donald 428 00:25:23,920 --> 00:25:28,320 Speaker 9: Trump over first finding out about Dino Salgazine, the Trump 429 00:25:28,359 --> 00:25:31,359 Speaker 9: Power door man, and that he had claimed that he 430 00:25:31,480 --> 00:25:34,399 Speaker 9: had a story that Trump had fathered a love child 431 00:25:34,600 --> 00:25:37,680 Speaker 9: with an employee at Trump Power. Even though that turned 432 00:25:37,680 --> 00:25:40,280 Speaker 9: out to be not true, they paid him tens of 433 00:25:40,280 --> 00:25:43,520 Speaker 9: thousands of dollars for silence. Second story happens to be 434 00:25:43,600 --> 00:25:47,520 Speaker 9: Karen McDougall, who was a playboy model and Trump had 435 00:25:47,520 --> 00:25:50,360 Speaker 9: had an affair with her sometime mid two thousands, and 436 00:25:50,800 --> 00:25:54,080 Speaker 9: Trump wanted that story Barry. So Pecker does it as 437 00:25:54,119 --> 00:25:57,560 Speaker 9: a favor and pays her off, but then becomes an 438 00:25:57,600 --> 00:25:59,639 Speaker 9: issue of who's going to pay him back, And by 439 00:25:59,680 --> 00:26:03,560 Speaker 9: the time Stormy Daniels comes along, he's not willing to 440 00:26:03,600 --> 00:26:06,840 Speaker 9: pay any extra money, and he tells Michael Cohen, You're 441 00:26:06,880 --> 00:26:08,720 Speaker 9: going to have to pay care of this. I'm not 442 00:26:08,880 --> 00:26:13,160 Speaker 9: going to. So basically we have three people right during 443 00:26:13,200 --> 00:26:17,679 Speaker 9: the campaign, and Pecker said he would be Trump's eyes 444 00:26:17,720 --> 00:26:22,320 Speaker 9: and ears about salacious stories and certainly informed Trump about them. 445 00:26:22,119 --> 00:26:25,440 Speaker 3: Were they able to make any inroads on cross Trump's. 446 00:26:25,160 --> 00:26:30,080 Speaker 9: Lawyer Emil Bogey tried to discredit accuracy of his memory 447 00:26:30,440 --> 00:26:35,280 Speaker 9: as well as details, apparently trying to highlight alleged inconsistencies 448 00:26:35,280 --> 00:26:39,159 Speaker 9: in his story. For example, he brought out that Pecker 449 00:26:39,240 --> 00:26:42,240 Speaker 9: may have not originally used the words catch and kill, 450 00:26:42,440 --> 00:26:45,639 Speaker 9: which is what the terminology for these buy and bury, 451 00:26:45,680 --> 00:26:49,400 Speaker 9: these salacious stories was. And there are some amazing moments 452 00:26:49,400 --> 00:26:53,760 Speaker 9: in this testimony, including Pecker recalls he does his favor 453 00:26:53,840 --> 00:26:56,720 Speaker 9: for Trump in twenty fifteen leading up to the twenty 454 00:26:56,760 --> 00:26:59,720 Speaker 9: sixteen election, and they have a meeting of Trump's power 455 00:27:00,000 --> 00:27:03,399 Speaker 9: in August twenty fifteen where they all discussed seeing Michael 456 00:27:03,440 --> 00:27:07,160 Speaker 9: Cohen and Trump discussed this Buy and Barry team. And 457 00:27:07,200 --> 00:27:10,800 Speaker 9: then he's invited to some power in January twenty seventeen, 458 00:27:11,280 --> 00:27:15,000 Speaker 9: and he walks in and he sees Trump meeting with 459 00:27:15,280 --> 00:27:18,120 Speaker 9: Mike Pompeo, who's going to be head of the CIA, 460 00:27:18,520 --> 00:27:21,359 Speaker 9: Jim Comey, who at the time was director of the FBI, 461 00:27:21,840 --> 00:27:24,960 Speaker 9: Sean Spicer, who is going to be Trump's spokesperson, as 462 00:27:25,000 --> 00:27:27,680 Speaker 9: well as Ryan's prebook who are going to be chief 463 00:27:27,720 --> 00:27:31,880 Speaker 9: of staff, and they're getting a briefing about shooting at 464 00:27:31,880 --> 00:27:35,879 Speaker 9: Fort Lauderdale Airport. Pecker's invited into the room and Trump 465 00:27:35,960 --> 00:27:38,800 Speaker 9: turned to them and he said, this guy is the 466 00:27:38,840 --> 00:27:42,439 Speaker 9: publisher of the National Enquirer. He knows more than all 467 00:27:42,480 --> 00:27:44,760 Speaker 9: of you, and he made it as a joke. But 468 00:27:45,000 --> 00:27:47,640 Speaker 9: Pecker said, none of them last, you know, even if 469 00:27:47,640 --> 00:27:50,320 Speaker 9: he met it as a joke. This meeting is going 470 00:27:50,320 --> 00:27:53,200 Speaker 9: on as a national security briefing for Trump. And then 471 00:27:53,240 --> 00:27:55,760 Speaker 9: he has the head of the National Inquirer Walt into 472 00:27:55,800 --> 00:27:57,040 Speaker 9: his office in the middle of it. 473 00:27:57,400 --> 00:27:59,159 Speaker 3: That sounds like a story that might be in the 474 00:27:59,240 --> 00:28:03,200 Speaker 3: National In the second witness was on the stand briefly 475 00:28:03,480 --> 00:28:06,480 Speaker 3: on Friday afternoon, but she worked for Trump for more 476 00:28:06,520 --> 00:28:07,439 Speaker 3: than twenty years. 477 00:28:08,119 --> 00:28:12,159 Speaker 9: Brona Grass, Donald Trump's former She's executive assistant. She no 478 00:28:12,200 --> 00:28:15,359 Speaker 9: longer worked for Trump, but her lawyer was being paid 479 00:28:15,359 --> 00:28:19,280 Speaker 9: for by the Trump organization. Trump himself never send MeMail. 480 00:28:19,520 --> 00:28:22,959 Speaker 9: This woman did it for him. There are Trump organization's 481 00:28:23,160 --> 00:28:29,160 Speaker 9: records of contact information, including Karen McDougal's cell phone numbers 482 00:28:29,160 --> 00:28:33,480 Speaker 9: and address, as well as Stormy Daniels's phone numbers immigrants, 483 00:28:33,960 --> 00:28:37,240 Speaker 9: so these are confirmed in Trump records, so he can't 484 00:28:37,240 --> 00:28:39,840 Speaker 9: say he doesn't know who these people are. They're actually 485 00:28:39,880 --> 00:28:42,400 Speaker 9: in the record. And at the prosecutor he even asked, 486 00:28:42,560 --> 00:28:46,760 Speaker 9: did you remember seeing Stormy Daniels at Trump's power somewhere 487 00:28:47,000 --> 00:28:50,840 Speaker 9: before twenty fifteen? And she did remember her, and she 488 00:28:51,040 --> 00:28:54,000 Speaker 9: said I knew that she was born stock and there 489 00:28:54,080 --> 00:28:57,360 Speaker 9: was pot among the staff that this woman was born Stof. 490 00:28:58,000 --> 00:29:01,120 Speaker 9: And then on Coss examination, Nicholson tried to suggest that 491 00:29:01,240 --> 00:29:04,680 Speaker 9: the reason that Stormy was there it was because Trump 492 00:29:05,080 --> 00:29:09,960 Speaker 9: liked to cast quote unquote controversial people as candidates for 493 00:29:10,440 --> 00:29:13,760 Speaker 9: the Celebrity Apprentice, and that the reason Stormy was there 494 00:29:14,040 --> 00:29:18,239 Speaker 9: was as potential celebrity apprentice candidate, and it was an 495 00:29:18,280 --> 00:29:22,280 Speaker 9: incredible moment. As she finished, she got up to leave. 496 00:29:22,680 --> 00:29:26,000 Speaker 9: Trump rose from the defense table and stood up and 497 00:29:26,040 --> 00:29:29,440 Speaker 9: went to walk over to greet her, seemed to shake 498 00:29:29,440 --> 00:29:32,360 Speaker 9: her hands, and there was this awkward moment because the 499 00:29:32,440 --> 00:29:35,280 Speaker 9: jury sitting there, the judges on the bench. But then 500 00:29:35,320 --> 00:29:38,480 Speaker 9: it seemed like Trump might have sought better of trying 501 00:29:38,480 --> 00:29:40,760 Speaker 9: to do this in the middle of the trial, in 502 00:29:40,840 --> 00:29:43,520 Speaker 9: the middle of the courtant well, but it was extraordinary 503 00:29:43,560 --> 00:29:47,280 Speaker 9: see the defendant get up and walk over to meet 504 00:29:47,360 --> 00:29:51,160 Speaker 9: and greet ronograph former assistant, and he was smiling broadly. 505 00:29:51,480 --> 00:29:55,040 Speaker 3: I guess it was instinct. And then the reality of 506 00:29:55,120 --> 00:29:58,880 Speaker 3: being the defendant set in. And the third witness, Michael 507 00:29:58,880 --> 00:30:02,520 Speaker 3: Cohen's banker, we'll be back on the stand Monday, signaling 508 00:30:02,560 --> 00:30:05,760 Speaker 3: we're at the document's part of the case now. Thanks 509 00:30:05,800 --> 00:30:08,640 Speaker 3: so much, Pat, We will check back with you on Monday. 510 00:30:09,040 --> 00:30:13,600 Speaker 3: That's Bloomberg Legal reporter Patricia Hurtado coming up. The Chamber 511 00:30:13,640 --> 00:30:17,200 Speaker 3: of Commerce sues the FTC over its non compete ban. 512 00:30:17,680 --> 00:30:19,920 Speaker 3: I'm June Grosso and you're listening to Bloomberg. 513 00:30:22,640 --> 00:30:26,560 Speaker 2: It's another thing to say you're working for a subway 514 00:30:27,080 --> 00:30:30,120 Speaker 2: and you can't walk across the street and go to 515 00:30:30,240 --> 00:30:32,960 Speaker 2: Jimmy Johns and get a twenty cent raise. What tells 516 00:30:33,000 --> 00:30:35,400 Speaker 2: that all about other than keeping wages down? 517 00:30:35,760 --> 00:30:39,280 Speaker 3: Three years ago, President Joe Biden signed an executive order 518 00:30:39,760 --> 00:30:43,720 Speaker 3: encouraging the Federal Trade Commission to limit non compete agreements 519 00:30:43,880 --> 00:30:48,040 Speaker 3: that prohibit workers from switching jobs within an industry. Non 520 00:30:48,080 --> 00:30:52,400 Speaker 3: competes effect about one in five Americans, and Biden's opposition 521 00:30:52,520 --> 00:30:55,400 Speaker 3: to them goes back to his time as Vice president. 522 00:30:55,760 --> 00:30:57,720 Speaker 3: Here he is in July of twenty twenty. 523 00:30:58,160 --> 00:31:00,920 Speaker 2: All those blue collar workers who we got I've fed 524 00:31:00,960 --> 00:31:03,959 Speaker 2: the line of malarkey the last twenty five years by 525 00:31:04,000 --> 00:31:07,640 Speaker 2: the Chamber of Congress that organized labors their problem. All 526 00:31:07,640 --> 00:31:09,960 Speaker 2: of a sudden, they're figuring out, I'm not a labor 527 00:31:10,040 --> 00:31:12,400 Speaker 2: You remember, why do I have to find a non 528 00:31:12,400 --> 00:31:15,080 Speaker 2: compete agreement if I make Hamburgers and I want to 529 00:31:15,120 --> 00:31:16,360 Speaker 2: go from one place to another? 530 00:31:16,720 --> 00:31:19,880 Speaker 3: And on Tuesday, the FTC voted to adopt a near 531 00:31:19,960 --> 00:31:23,720 Speaker 3: ban on non compete clauses, saying it will impact about 532 00:31:23,760 --> 00:31:27,640 Speaker 3: thirty million Americans and increased worker earnings by more than 533 00:31:27,720 --> 00:31:31,760 Speaker 3: four hundred billion dollars over ten years. But on Wednesday, 534 00:31:32,000 --> 00:31:36,120 Speaker 3: the Chamber of Commerce sued the FTC, challenging the rule 535 00:31:36,360 --> 00:31:39,280 Speaker 3: in the latest battle between the business community and the 536 00:31:39,280 --> 00:31:43,880 Speaker 3: Biden administration. Joining me is Bloomberg reporter leon Nilan Leah 537 00:31:43,880 --> 00:31:46,480 Speaker 3: tell Us about the FTC's ban on non competes. 538 00:31:47,400 --> 00:31:51,200 Speaker 7: Yeah, so the FTC voted to adopt a nearly complete 539 00:31:51,240 --> 00:31:54,680 Speaker 7: ban on non competes going forward, so after the rule 540 00:31:54,720 --> 00:31:58,040 Speaker 7: goes into effect that there will be no more non competes, 541 00:31:58,240 --> 00:32:01,560 Speaker 7: which are essentially just clauses in employee contracts that forbid 542 00:32:01,600 --> 00:32:04,320 Speaker 7: them from switching jobs within an industry. There's a couple 543 00:32:04,480 --> 00:32:08,080 Speaker 7: tiny high valve. One, if you are an executive who 544 00:32:08,160 --> 00:32:10,880 Speaker 7: is currently subject to a noncompete, and they define an 545 00:32:10,960 --> 00:32:13,600 Speaker 7: executive as somebody who makes more than one hundred and 546 00:32:13,680 --> 00:32:17,080 Speaker 7: fifty thousand dollars per year and has a policy position 547 00:32:17,120 --> 00:32:20,280 Speaker 7: within your organization, you can still be subject to your 548 00:32:20,320 --> 00:32:24,280 Speaker 7: current noncompete, but executives going forward cannot enter into new ones. 549 00:32:24,560 --> 00:32:26,920 Speaker 7: And the other sort of tiny caveat they made is 550 00:32:26,960 --> 00:32:29,080 Speaker 7: if you are selling a business, you can be subject 551 00:32:29,120 --> 00:32:31,720 Speaker 7: to a noncompete because they're trying to prevent essentially, you 552 00:32:31,760 --> 00:32:34,880 Speaker 7: know a thing where somebody who is a startup founder 553 00:32:34,960 --> 00:32:37,440 Speaker 7: or something sells their business to someone and then goes 554 00:32:37,440 --> 00:32:39,280 Speaker 7: out the next day and starts the same business under 555 00:32:39,280 --> 00:32:41,520 Speaker 7: a different name. You know, businesses do want a little 556 00:32:41,560 --> 00:32:45,040 Speaker 7: bit of comfort that when they buy something they're getting 557 00:32:45,040 --> 00:32:47,480 Speaker 7: all of the assets and sort of knowledge there. 558 00:32:47,880 --> 00:32:51,080 Speaker 3: Many people still think of non competes as being for 559 00:32:51,600 --> 00:32:55,880 Speaker 3: executives people with trade secrets, but nowadays they even apply 560 00:32:56,080 --> 00:33:00,160 Speaker 3: to blue collar workers and minimum wage workers. 561 00:33:00,600 --> 00:33:03,880 Speaker 7: Yes, the SEC started this initiative a couple of years ago. 562 00:33:04,000 --> 00:33:06,200 Speaker 7: They started it with a workshop in which they had 563 00:33:06,400 --> 00:33:09,560 Speaker 7: academics who had studied this come in, and they also 564 00:33:09,640 --> 00:33:12,560 Speaker 7: had some state lawmakers because before now non commutes were 565 00:33:12,640 --> 00:33:15,120 Speaker 7: largely regulated at the state. And it was actually a 566 00:33:15,160 --> 00:33:18,360 Speaker 7: pretty interesting workshop that happened during the coup administration the 567 00:33:18,560 --> 00:33:21,480 Speaker 7: Attorney's General from Illinois and a couple other states about 568 00:33:21,480 --> 00:33:24,280 Speaker 7: how they had found that there were like a weird 569 00:33:24,320 --> 00:33:26,960 Speaker 7: proliferation of these in a lot of as you mentioned, 570 00:33:27,000 --> 00:33:29,680 Speaker 7: like minimum wage jobs. There ended up being a pretty 571 00:33:29,720 --> 00:33:33,360 Speaker 7: famous one involving the sandwich Shane Jimmy Jones, and which 572 00:33:33,440 --> 00:33:36,520 Speaker 7: it was trying to prevent it's sandwich makers from going 573 00:33:36,600 --> 00:33:39,680 Speaker 7: anywhere else that made sandwiches. They had a pretty detailed 574 00:33:39,680 --> 00:33:41,920 Speaker 7: list of things that they couldn't do, including like making 575 00:33:42,000 --> 00:33:46,959 Speaker 7: pidas or making hogis, all of these different types of sandwiches. 576 00:33:47,040 --> 00:33:49,560 Speaker 7: You couldn't go somewhere else that made them. They found 577 00:33:49,720 --> 00:33:52,479 Speaker 7: out in Washington State people were doing it at coffee shops, 578 00:33:52,600 --> 00:33:55,760 Speaker 7: you know, they didn't want baristas moving around. It's fairly 579 00:33:55,840 --> 00:34:00,000 Speaker 7: common among hairdressers. So yes, while it's sort of associated 580 00:34:00,240 --> 00:34:04,520 Speaker 7: with executive in very like well compensated employees, it had 581 00:34:04,520 --> 00:34:07,280 Speaker 7: really like proliferated around the economy to a lot of 582 00:34:07,680 --> 00:34:11,000 Speaker 7: lower wage jobs, and even some that you might be 583 00:34:11,040 --> 00:34:14,799 Speaker 7: surprised by, like doctors and nurses were often being asked 584 00:34:14,840 --> 00:34:16,640 Speaker 7: to sign non compete. 585 00:34:16,520 --> 00:34:21,000 Speaker 3: Well, sandwich makers also surprises me. And Biden was pushing 586 00:34:21,040 --> 00:34:23,919 Speaker 3: the FTC for this non compete ban. 587 00:34:24,800 --> 00:34:27,680 Speaker 7: Yes, Joe Biden signed this executive order his first year, 588 00:34:27,719 --> 00:34:30,719 Speaker 7: the Executive Order on competition, And he actually says in 589 00:34:30,760 --> 00:34:32,680 Speaker 7: some of his public speaking that's the thing that first 590 00:34:32,719 --> 00:34:35,160 Speaker 7: made him very interested in the issue of competition was 591 00:34:35,200 --> 00:34:37,759 Speaker 7: when he was on the campaign trail hearing from a 592 00:34:37,880 --> 00:34:40,320 Speaker 7: number of workers who had mentioned to him non compete 593 00:34:40,440 --> 00:34:42,480 Speaker 7: and that really sort of struck him as wrong. You know, 594 00:34:42,520 --> 00:34:45,799 Speaker 7: like non competes are a fundamental restraint of trade, as 595 00:34:45,840 --> 00:34:48,280 Speaker 7: people say, you know, it is literally preventing a worker 596 00:34:48,320 --> 00:34:50,120 Speaker 7: from going out and trying to get a better job 597 00:34:50,200 --> 00:34:54,080 Speaker 7: that pays them well. And particularly when you have, you know, 598 00:34:54,200 --> 00:34:57,080 Speaker 7: people who have skills that require some kind of licensing 599 00:34:57,120 --> 00:34:59,920 Speaker 7: within a state, like medical or even hairdressers. You know, 600 00:35:00,120 --> 00:35:01,880 Speaker 7: when you move, if you try and move out of 601 00:35:01,880 --> 00:35:03,560 Speaker 7: state to get another job, you have to go through 602 00:35:03,560 --> 00:35:06,680 Speaker 7: the process of getting your recertification. It's very expensive. So 603 00:35:06,960 --> 00:35:09,520 Speaker 7: these non competes can have a pretty serious impact on 604 00:35:09,560 --> 00:35:12,439 Speaker 7: people's everyday lives when you really can't go and work 605 00:35:12,520 --> 00:35:13,520 Speaker 7: for a competitor. 606 00:35:13,800 --> 00:35:16,799 Speaker 3: But this was a narrow three to two vote. It 607 00:35:16,840 --> 00:35:18,000 Speaker 3: went down party lines. 608 00:35:18,480 --> 00:35:21,279 Speaker 7: Yes, so the SEC is a five number body. It 609 00:35:21,360 --> 00:35:24,279 Speaker 7: has three Democrats right now because the Democrats are in 610 00:35:24,320 --> 00:35:27,000 Speaker 7: the majority, and then two Republicans, and they did vote 611 00:35:27,000 --> 00:35:30,400 Speaker 7: along party lines. Both of the Republicans gave public statements 612 00:35:30,440 --> 00:35:32,840 Speaker 7: and during the Open Commission meeting earlier this week, and 613 00:35:32,880 --> 00:35:35,279 Speaker 7: they said that while they sort of agree in principles 614 00:35:35,520 --> 00:35:39,880 Speaker 7: that noncompetes are problematic, they are concerned that the FTC 615 00:35:39,920 --> 00:35:42,560 Speaker 7: does not have the authority to issue this type of rule. 616 00:35:42,840 --> 00:35:45,200 Speaker 7: And that is what various lawsuits that have now been 617 00:35:45,280 --> 00:35:48,120 Speaker 7: filed challenging the rule have also said because there is 618 00:35:48,200 --> 00:35:50,680 Speaker 7: a little bit of a question about whether the SEC 619 00:35:50,800 --> 00:35:53,359 Speaker 7: Statute as written would allow them to have this rule. 620 00:35:53,760 --> 00:35:57,600 Speaker 3: So the Chamber of Commerce, the nation's largest business lobby, 621 00:35:57,719 --> 00:36:00,319 Speaker 3: is one of those suing. Is that what is they're 622 00:36:00,400 --> 00:36:02,879 Speaker 3: alleging that the FDC just doesn't have the authority here. 623 00:36:03,239 --> 00:36:05,680 Speaker 7: Yes, they have two major arguments, the first being the 624 00:36:05,760 --> 00:36:07,839 Speaker 7: SEC does not have the authority to issue this type 625 00:36:07,880 --> 00:36:11,240 Speaker 7: of rule. So STEC says it does because the FTC 626 00:36:11,280 --> 00:36:14,480 Speaker 7: Act allows them to prohibit what are known as unfair 627 00:36:14,480 --> 00:36:17,400 Speaker 7: methods of competition, and so in the rule they said 628 00:36:17,400 --> 00:36:20,080 Speaker 7: this is an unfair method of competition. And the SEC 629 00:36:20,239 --> 00:36:22,719 Speaker 7: Act also has another section that says that they are 630 00:36:22,760 --> 00:36:26,040 Speaker 7: allowed to issue rules and regulations to help enforce the law. 631 00:36:26,440 --> 00:36:28,919 Speaker 7: So the Democrats on the FTC, they think that makes 632 00:36:28,920 --> 00:36:31,320 Speaker 7: it pretty clear that they are allowed to issue a 633 00:36:31,400 --> 00:36:35,040 Speaker 7: rule of this type. The Republicans say, you know, historically 634 00:36:35,200 --> 00:36:39,400 Speaker 7: the FTC has prohibited unfair methods of competition by individual 635 00:36:39,520 --> 00:36:43,640 Speaker 7: enforcement actions, and very rarely has it actually gone through 636 00:36:43,760 --> 00:36:47,160 Speaker 7: with rule making. And the last time they had a 637 00:36:47,280 --> 00:36:51,480 Speaker 7: rule making that used this unfair Methods of Competition Statute 638 00:36:51,840 --> 00:36:53,960 Speaker 7: on its own to make a rule with something like 639 00:36:54,000 --> 00:36:58,160 Speaker 7: the nineteen seventies, and generally they make rules under some 640 00:36:58,200 --> 00:37:02,000 Speaker 7: of their other authorities. That is like one half of 641 00:37:02,080 --> 00:37:04,880 Speaker 7: the Chamber of Commerces lawsuits. The other half is, you know, 642 00:37:04,920 --> 00:37:08,319 Speaker 7: the Supreme Court in a case recently said that they 643 00:37:08,360 --> 00:37:13,120 Speaker 7: have concerns when agencies act on major questions, and so 644 00:37:13,360 --> 00:37:16,799 Speaker 7: the Chamber of Commerce is also sort of challenging the 645 00:37:16,920 --> 00:37:20,600 Speaker 7: STCs on compete van under this major questions doctrine. You know, 646 00:37:20,640 --> 00:37:23,080 Speaker 7: that's the idea that if Congress really did want you 647 00:37:23,160 --> 00:37:25,239 Speaker 7: to solve this major question, they would have been very, 648 00:37:25,320 --> 00:37:28,640 Speaker 7: very explicit in the statute that this was the sort 649 00:37:28,680 --> 00:37:30,600 Speaker 7: of action that the agency could take. 650 00:37:31,080 --> 00:37:33,960 Speaker 3: And also the Supreme Court, the conservative members of the 651 00:37:34,000 --> 00:37:36,960 Speaker 3: Supreme Court are on sort of a mission against the 652 00:37:37,000 --> 00:37:42,080 Speaker 3: administrative state, and there are several cases involving the reach 653 00:37:42,120 --> 00:37:45,719 Speaker 3: of agency powers. So do people you've talked to think 654 00:37:45,800 --> 00:37:48,080 Speaker 3: that the Chamber has a good case here? 655 00:37:48,760 --> 00:37:52,040 Speaker 7: It's pretty much right now, following along party lines. You know, 656 00:37:52,320 --> 00:37:55,040 Speaker 7: the STC did have a challenge to its authority to 657 00:37:55,040 --> 00:37:57,640 Speaker 7: make rules back in the nineteen seventies that took place 658 00:37:57,680 --> 00:37:59,920 Speaker 7: here in the DC Circuit. That's part of the reas 659 00:38:00,080 --> 00:38:02,439 Speaker 7: in why the Chamber opted to sew in Texas, which 660 00:38:02,480 --> 00:38:05,400 Speaker 7: is in the more conservative Fifth Circuit, because if they 661 00:38:05,400 --> 00:38:07,719 Speaker 7: had filed here, you know, they would probably refer back 662 00:38:07,719 --> 00:38:09,960 Speaker 7: to this nineteen seventies case that says, yes, we think 663 00:38:10,000 --> 00:38:13,440 Speaker 7: the FTC has this authority. But by filing in a 664 00:38:13,560 --> 00:38:16,000 Speaker 7: new circuit, you know, they can sort of have that 665 00:38:16,040 --> 00:38:19,360 Speaker 7: circuit take the question up a new potentially creating a 666 00:38:19,400 --> 00:38:20,960 Speaker 7: circuit split that they could then take up to the 667 00:38:21,000 --> 00:38:21,640 Speaker 7: Supreme Court. 668 00:38:22,280 --> 00:38:25,440 Speaker 3: And what other groups are suing besides the Chamber, So the. 669 00:38:25,360 --> 00:38:27,759 Speaker 7: Chair of Commerce and the Business round Table are two 670 00:38:28,120 --> 00:38:31,200 Speaker 7: alongside them local chambers of Commerce in Texas. That's how 671 00:38:31,239 --> 00:38:34,000 Speaker 7: they got venues in Texas. There was also a tax 672 00:38:34,080 --> 00:38:38,960 Speaker 7: firm that filed its own lawsuit, and yeah, we've we've 673 00:38:38,960 --> 00:38:42,240 Speaker 7: been getting a couple others of various people who are filing. 674 00:38:42,440 --> 00:38:44,719 Speaker 7: When the SEC announced this, there were a bunch of 675 00:38:44,719 --> 00:38:49,799 Speaker 7: business groups that came out against it, including HR professionals associations. 676 00:38:50,080 --> 00:38:53,600 Speaker 7: A lot of professional associations like actuaries things like that 677 00:38:53,640 --> 00:38:56,160 Speaker 7: came out against the idea of banning non competes. 678 00:38:56,880 --> 00:38:59,920 Speaker 3: So the noncompete ban is supposed to add hundreds of 679 00:39:00,080 --> 00:39:04,160 Speaker 3: billions of dollars to workers' earnings. Is that why business 680 00:39:04,160 --> 00:39:07,600 Speaker 3: groups are mostly against it, or are there other reasons 681 00:39:07,600 --> 00:39:09,080 Speaker 3: besides money, money money. 682 00:39:09,360 --> 00:39:12,960 Speaker 7: The business groups say that non compete are useful for 683 00:39:13,080 --> 00:39:15,960 Speaker 7: sort of protecting business information. So you know, you don't 684 00:39:16,000 --> 00:39:19,040 Speaker 7: really want to hire an employee and then have them 685 00:39:19,080 --> 00:39:21,440 Speaker 7: the next day go across the street to your biggest 686 00:39:21,520 --> 00:39:24,719 Speaker 7: rival and tell them all of your customers or your 687 00:39:24,760 --> 00:39:28,600 Speaker 7: business plans and strategy. The SEC says in response, there 688 00:39:28,600 --> 00:39:31,520 Speaker 7: are all sources of other laws that you could use 689 00:39:31,680 --> 00:39:36,640 Speaker 7: to address that trade secret law, non solicitation clauses, things 690 00:39:36,680 --> 00:39:38,840 Speaker 7: like that, so you don't really need a non compete 691 00:39:38,840 --> 00:39:43,439 Speaker 7: which effectively bars them from taking another job. The other 692 00:39:43,719 --> 00:39:46,000 Speaker 7: aspects of the SEC left open in the rule is 693 00:39:46,040 --> 00:39:49,200 Speaker 7: that you could offer an employee garden leave is sort 694 00:39:49,239 --> 00:39:52,080 Speaker 7: of what it's known as, which is where you are 695 00:39:52,120 --> 00:39:55,000 Speaker 7: requiring them not to take another job for a certain 696 00:39:55,000 --> 00:39:57,520 Speaker 7: period of time, but you are continuing to pay them 697 00:39:57,600 --> 00:40:01,239 Speaker 7: either a salary or some sort of compensation to make 698 00:40:01,320 --> 00:40:03,520 Speaker 7: up for the fact that they can't take this other job. 699 00:40:03,760 --> 00:40:06,279 Speaker 7: That way, when they go to a new employer with 700 00:40:06,280 --> 00:40:08,520 Speaker 7: the information they have about your company is at least 701 00:40:08,560 --> 00:40:09,360 Speaker 7: a little bit dated. 702 00:40:09,719 --> 00:40:12,919 Speaker 3: As part of the rulemaking process, there was a solicitation 703 00:40:13,120 --> 00:40:15,080 Speaker 3: of public comments. Tell us about that. 704 00:40:15,800 --> 00:40:18,959 Speaker 7: Yes, so the FCC got twenty six thousand comments, which 705 00:40:19,040 --> 00:40:22,560 Speaker 7: is a lot for the FPC. Oftentimes they put out 706 00:40:22,560 --> 00:40:24,600 Speaker 7: for public comments and on newly get a couple hundred, 707 00:40:24,640 --> 00:40:27,080 Speaker 7: So they were pleasantly surprised that they got twenty six thousand. 708 00:40:27,400 --> 00:40:30,640 Speaker 7: Of the twenty six twenty five thousand were actually in 709 00:40:30,680 --> 00:40:33,120 Speaker 7: support of the rule, which is one of the things 710 00:40:33,120 --> 00:40:36,240 Speaker 7: that they cited for a reason why they felt comfortable 711 00:40:36,239 --> 00:40:37,920 Speaker 7: and we're in the forward with this, and in the 712 00:40:38,000 --> 00:40:40,640 Speaker 7: rule itself, they cited a bunch of them from individuals 713 00:40:40,640 --> 00:40:45,040 Speaker 7: who talked about how non competes had significantly impacted their lives, 714 00:40:45,160 --> 00:40:48,160 Speaker 7: preventing them from taking, you know, other jobs, or when 715 00:40:48,160 --> 00:40:50,480 Speaker 7: they did try and take another job, they got sued. 716 00:40:50,719 --> 00:40:53,160 Speaker 7: As I mentioned before, a lot of non competes before 717 00:40:53,200 --> 00:40:56,360 Speaker 7: this rule were really handled in an estate by state basis, 718 00:40:56,400 --> 00:40:59,160 Speaker 7: and because of that, you know, you would often have 719 00:40:59,239 --> 00:41:01,120 Speaker 7: to go to court to be if a noncompete was 720 00:41:01,239 --> 00:41:03,840 Speaker 7: enforceable or not. And the average person doesn't have a 721 00:41:03,880 --> 00:41:07,759 Speaker 7: lot of experience with courts or suing over contracts, and 722 00:41:07,880 --> 00:41:10,680 Speaker 7: so when you know an employer might threaten to see them, 723 00:41:10,719 --> 00:41:13,360 Speaker 7: that was sometimes enough to keep them from trying to 724 00:41:13,440 --> 00:41:15,160 Speaker 7: change jobs because they don't really want to have to 725 00:41:15,200 --> 00:41:15,640 Speaker 7: deal with that. 726 00:41:16,520 --> 00:41:20,200 Speaker 3: And explain how broad an effect the FTC or the 727 00:41:20,239 --> 00:41:24,160 Speaker 3: Biden administration expects this to have on the workplace. 728 00:41:24,840 --> 00:41:28,239 Speaker 7: So the SEC did some of its own calculations on 729 00:41:28,440 --> 00:41:31,319 Speaker 7: how broad this might be. They estimated that it would 730 00:41:31,360 --> 00:41:34,960 Speaker 7: impact wages to the two to four hundred billion billions 731 00:41:35,000 --> 00:41:38,040 Speaker 7: dollars over the next ten years. They also said that 732 00:41:38,080 --> 00:41:40,520 Speaker 7: they think that it may help with small business formation 733 00:41:40,680 --> 00:41:43,759 Speaker 7: because when people are no longer subject to a noncompete, 734 00:41:43,760 --> 00:41:45,920 Speaker 7: they can go out and start their own businesses in 735 00:41:45,960 --> 00:41:49,120 Speaker 7: the same industry. And so they had some research that 736 00:41:49,160 --> 00:41:51,800 Speaker 7: they did showing that it would increase new business formation 737 00:41:51,880 --> 00:41:53,879 Speaker 7: by as much as two point seven percent a year. 738 00:41:54,120 --> 00:41:56,400 Speaker 7: So their findings were largely that this would have a 739 00:41:56,440 --> 00:41:58,000 Speaker 7: positive impact on the economy. 740 00:41:58,360 --> 00:42:01,040 Speaker 3: We'll see if the Chamber is lost suit stops it 741 00:42:01,080 --> 00:42:04,880 Speaker 3: from going into effect. Thanks so much, Leah. That's Bloomberg 742 00:42:04,920 --> 00:42:08,160 Speaker 3: reporter Leah Nylan. This is the second time in two 743 00:42:08,200 --> 00:42:10,960 Speaker 3: months that the Chamber of Commerce has sued over a 744 00:42:10,960 --> 00:42:14,920 Speaker 3: Biden Administration rule. Last month, the Chamber filed the lawsuit 745 00:42:15,000 --> 00:42:19,280 Speaker 3: challenging the Consumer Financial Protection Bureau rule that caps credit 746 00:42:19,280 --> 00:42:22,839 Speaker 3: card late fees at eight dollars for the largest issuers. 747 00:42:23,239 --> 00:42:25,560 Speaker 3: And that's it for this edition of The Bloomberg Law Show. 748 00:42:25,880 --> 00:42:28,239 Speaker 3: Remember you can always get the latest legal news on 749 00:42:28,280 --> 00:42:32,560 Speaker 3: our Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify, 750 00:42:32,760 --> 00:42:37,800 Speaker 3: and at www dot bloomberg dot com, slash podcast Slash Law, 751 00:42:38,200 --> 00:42:40,760 Speaker 3: And remember to tune into The Bloomberg Law Show every 752 00:42:40,840 --> 00:42:44,720 Speaker 3: weeknight at ten pm Wall Street Time. I'm June Grosso 753 00:42:44,880 --> 00:42:46,480 Speaker 3: and you're listening to Bloomberg