Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.
Speaker 2: The resentencing hearing for the Menendez brothers was delayed again
Speaker 2: last week.
Speaker 1: I would ask you'd asked the DA why at the
Speaker 1: last minute he doesn't hail mary filing of emotion to
Speaker 1: continue and does not notify any of the.
Speaker 3: Victims or the victim's lawyer. Why what is going on?
Speaker 2: Whose interest is he? Vindicating The newly elected LA District
Speaker 2: Attorney Nathan Hakman through a curveball. Just hours before the
Speaker 2: hearing was supposed to begin, he asked for a delay,
Speaker 2: arguing that the judge should first see a risk assessment
Speaker 2: on the brothers done by the California Parole Board as
Speaker 2: part of a separate proceeding.
Speaker 4: We believed it constituted additional facts that the court should
Speaker 4: consider in deciding whether or not the Menendez brothers do
Speaker 4: pose a risk of danger to society.
Speaker 2: Hawkman reversed corps from the prior d who said the
Speaker 2: brothers had been rehabilitated while in prison and should be
Speaker 2: eligible for parole as youthful offenders. But Hawkman firmly opposes
Speaker 2: the resentencing.
Speaker 4: In order to be truly rehabilitated, you have to acknowledge
Speaker 4: the full breadth of your criminal conduct, your cover up,
Speaker 4: and your lives.
Speaker 2: Mark Geragos, the brother's attorney, is calling for Hawkman to
Speaker 2: be thrown off the case, saying the DA is biased
Speaker 2: against the brothers and not acting in good faith with
Speaker 2: the other Menandez family members, including some who flew in
Speaker 2: to testify at the hearing. Joining me is Attorney Dave Ahrenberg,
Speaker 2: the former Palm Beach County State Attorney. A report on
Speaker 2: each brother was recently conducted by a forensic psychologist as
Speaker 2: part of the Parole Board's clemency investigation. Why did this
Speaker 2: end up delaying the hearing that had been scheduled, Well, the.
Speaker 3: Judge wants to make sure he's got all the information.
Speaker 3: Because the judge actually rejected the demands of the district
Speaker 3: attorney to not have the resentencing. The previous district attorney
Speaker 3: wanted the resentencing. The newly elected district attorney did not
Speaker 3: want the resentencing. So the judge said surprisingly that Nope,
Speaker 3: no takebacks. We're going to go ahead with this resentencing,
Speaker 3: and we want to make sure that we have every
Speaker 3: possible document so that if the Menandaz brothers get released,
Speaker 3: that the judge has some cover from outside experts. Isn't
Speaker 3: just releasing these brutal murders into the public without enough
Speaker 3: paperwork to justify it.
Speaker 2: Is the judge entitled to hear something from a separate
Speaker 2: proceeding before the parole board. There are two completely separate things,
Speaker 2: aren't they right?
Speaker 3: The parle board is different, but it's relevant for the judge.
Speaker 3: The judge is the boss. He can decide to examine
Speaker 3: whatever he wants to because this is not a jury trial.
Speaker 3: This is not about the rules of evidence in keeping
Speaker 3: things from the jury to make sure the defendant gets
Speaker 3: a fair trial. This is about getting as much information
Speaker 3: as possible so the judge can make a decision on
Speaker 3: the resentence. Maybe what the judge decide, the pro Board
Speaker 3: will get involved. In fact, the pro Board could get
Speaker 3: involved even if the judge decides to reject a Menendez
Speaker 3: brother's request to get out of jail early, because then
Speaker 3: the governor, through the clemency process, could refer to the
Speaker 3: pro board. So the pro Board is relevant regardless of
Speaker 3: what the judge says or does.
Speaker 2: The District Attorney's team filed a motion for continuance just
Speaker 2: hours before the hearing. I mean, they knew this was
Speaker 2: out there, Why so late to try to delay this?
Speaker 3: You know, I don't know that answer. The defense lawyers
Speaker 3: have been wanting to speed up this process for a
Speaker 3: while because their clients sit behind bars, So I don't
Speaker 3: know why they decide to delay it right now. Maybe
Speaker 3: it's because they had not fully vetted this reporter. Maybe
Speaker 3: the report has some damaging things in it that they
Speaker 3: need to respond to, So maybe that's perhaps the answer.
Speaker 2: So let's talk about this second district attorney, the newly
Speaker 2: elected district attorney who says that Eric and Lylemanendez have
Speaker 2: to admit that they've lied to everyone for the past
Speaker 2: thirty years, and also says that the abuse they're claiming
Speaker 2: doesn't amount to a self defense claim. And this sort
Speaker 2: of always hits me with parole hearings where they want
Speaker 2: the accused to say that they're guilty. Why is it
Speaker 2: so important to him to hear them say that they lied?
Speaker 3: Because they lied, So that's why he wants them to
Speaker 3: mess up, because they're liars. They lied throughout the whole process.
Speaker 3: They lied about the motivations. At first, they said they
Speaker 3: weren't even the killers. They were going out there living
Speaker 3: large until finally it got back to them. These Menenda's
Speaker 3: brothers tried to cover their tracks, and that's why a
Speaker 3: lot of us think that they should face the penalty
Speaker 3: of the jury and the judge gave them, which is
Speaker 3: life in prison. And so there on the brink of
Speaker 3: getting a major break here, and so the least that
Speaker 3: they could do, according to the district attorneys, at least
Speaker 3: admit that you lied, at least emit and own up
Speaker 3: to what you did so that you can show real
Speaker 3: remorse instead of all the smokescreens have been putting up
Speaker 3: for the past several decades.
Speaker 2: But isn't it resentencing about whether or not they've changed
Speaker 2: and rehabilitated themselves in prison.
Speaker 3: Well, there's two things. The original DA who was voted
Speaker 3: out of office, said that he supported the resentencing because
Speaker 3: the brothers supposedly were on really good behavior and were
Speaker 3: model prisoners, and that is a reason why the former
Speaker 3: DA wanted them released. That's the main reason. But there's
Speaker 3: another reason that will come up in the resentencing hearing,
Speaker 3: in that the defense is saying that the brothers were
Speaker 3: not allowed to pursue their abuse excuse, which is that
Speaker 3: their father, Jose sexually abused him, and that modifies the
Speaker 3: crime because they're saying that it's now manslaughter instead of murder.
Speaker 3: That they were under extreme emotional stress, they were acting
Speaker 3: as victims of sexual abuse and that's why they did it.
Speaker 3: They were not allowed to bring up that defense at trial.
Speaker 3: So there are two avenues that the defense is going.
Speaker 3: Number one, that their model prisoners and deserve to be
Speaker 3: released early. And number two that they were victims of
Speaker 3: sexual abuse from the father and thus there should be
Speaker 3: a manslaughter case and not a murder case. And if
Speaker 3: it is a manslaughter conviction, then they would have been
Speaker 3: out already.
Speaker 2: Yeah, because in the first trial the evidence or the
Speaker 2: testimony about sex abuse was allowed in and then the
Speaker 2: second trial it wasn't correct.
Speaker 3: And this is the second trial that convicted them. The
Speaker 3: first trial led to a hung jury. Of course, in
Speaker 3: boat trials they were wearing those mister rogers Wedters had
Speaker 3: to try to soften them after himing such a brutal crime,
Speaker 3: being such a spoiled and titled kids who lived high
Speaker 3: in the hog after they murdered their parents. And keep
Speaker 3: in mind, when they did what they did, the parents
Speaker 3: had their backs turned to them. The parents were watching
Speaker 3: TV eating ice cream on the couch while the boys
Speaker 3: walked up behind them and then blew them away with shotguns.
Speaker 3: And when the mother tried crawling away because she didn't die,
Speaker 3: the boys went back outside to reload their shotgun to
Speaker 3: come in and finish the job. And there was so
Speaker 3: much blood at the scene that investigators thought it was
Speaker 3: a mob hit. And the brothers lied. They lied the
Speaker 3: whole time, and they lied until they could lie no more.
Speaker 3: And that's why the DA's saying, all right, guys, own
Speaker 3: up to what you did, own up to what you said,
Speaker 3: and then you can get a break.
Speaker 2: Where does it play in that Almost all except I
Speaker 2: think for one of the family members are supporting their
Speaker 2: bid to get out of prison.
Speaker 3: Yeah, this has become a cause slept and the momentum
Speaker 3: is clearly with the brothers. They've been all the movies,
Speaker 3: documentaries and time does heal some wounds and so with
Speaker 3: new information also about Jose's sexual abuse allegedly of the
Speaker 3: minudo boy band member, and then some other evidence that
Speaker 3: was not admitted in the second trial where apparently one
Speaker 3: of the brothers confided in someone that he was a
Speaker 3: victim of sexual abuse. That all this together has galvanized
Speaker 3: the family to support the brothers, not all the family,
Speaker 3: but almost all. But the DA doesn't represent the victims
Speaker 3: or the families. The DA represents the people. It's the
Speaker 3: state the people, and the DA has to make the
Speaker 3: best decision based on principles of justice, and this DA
Speaker 3: says principles of justice mean they should not get out
Speaker 3: of prison now. It's not just the DA's call, it's
Speaker 3: the judge's call now, and the former DA help push
Speaker 3: this along. That's why the judge has a lot of power.
Speaker 3: And even if the judge says no, then the governor
Speaker 3: could still get involved and work with a pro board
Speaker 3: to let them free.
Speaker 2: The defense attorney feels that this DA is prejudiced against them,
Speaker 2: and even the family members complained because during the last hearing,
Speaker 2: the DA showed those gruesome photos of the murders without
Speaker 2: telling them that that was going to happen, and one
Speaker 2: of the ants ended up in the hospital and the
Speaker 2: family said she'd been traumatized by the photos, and the
Speaker 2: deputy DA apologized for not warning them, but said Eric
Speaker 2: and Lyle Menendez caused that carnage, not me, which almost
Speaker 2: sounds like a retraction of the apology. So it seems
Speaker 2: like the La County DA has taken some missteps, and
Speaker 2: so the defense attorney is asking for the DA to
Speaker 2: be thrown off the case and replaced by the Attorney
Speaker 2: General of the state. Is that at all likely?
Speaker 3: Yeah? I don't think that should happen, And I don't
Speaker 3: think the DA has crossed the line of the days
Speaker 3: using the pictures of what had happened. I mean, if
Speaker 3: you're going to let them free, you got to come
Speaker 3: to grips with what they did and not just gloss
Speaker 3: over it. It shouldn't be a one sided conversation. I mean,
Speaker 3: they committed a brutal, horrific crime, and just because decades
Speaker 3: have passed and now Kim Kardashian and major celebrities are
Speaker 3: behind them, doesn't mean you get a whitewash what they did.
Speaker 3: And so that's where the DA's like, hey, remember what
Speaker 3: they did. Remember who were murdered here? I mean he's
Speaker 3: giving voice to Kitty and Jose. And even if Jose
Speaker 3: committed sexual abuse of the brothers, does that justify what
Speaker 3: they did to Kitty. I mean, Kitty was murdered in
Speaker 3: such a horrific way when she was trying to crawl
Speaker 3: away to save her life. That I don't see how
Speaker 3: that would be justified under manslaughter principles and not pure murder.
Speaker 3: I mean, there's no credible allegation that Kitty engaged in
Speaker 3: sexual abuse with the kids. Now the argument is that
Speaker 3: she looked the other way, But does that justify her
Speaker 3: brutal murder? So that's why I think, you know, I
Speaker 3: understand why the DA one of those pictures in of
Speaker 3: course they should should have given some notice, but that's
Speaker 3: not enough to kick them off the case.
Speaker 2: And so, and as you said, even if the judge
Speaker 2: resentences them, they'll still have to go before the parole board.
Speaker 3: You know, the pro board does have an involvement here,
Speaker 3: and yes, they'd still be involved. And that's why it's
Speaker 3: not just the judge that makes the complete decision. The
Speaker 3: par board is involved. And even if the judge decides
Speaker 3: to reject the request from the defense, the pro board
Speaker 3: will get involved. If the governor decides to move ahead
Speaker 3: with clemency.
Speaker 2: Yeah, nothing stops the governor from granting clemency. And the
Speaker 2: rehearing is now reschedule from May ninth. We'll see if
Speaker 2: it actually takes place this time coming up next on
Speaker 2: the Bloomberg Law Show. I'll continue this conversation with Dave
Speaker 2: Ahrenberg on Friday. Luigia Mangioni is set to make his
Speaker 2: first appearance in federal court since the Justice Department said
Speaker 2: it would seek the death penalty in charging mangione murdered
Speaker 2: a United Healthcare executive. I'm June Grosso. When you're listening
Speaker 2: to Bloomberg. On Friday, Luigi Mangioni is set to make
Speaker 2: his first appearance in federal court since the Justice Department
Speaker 2: said it would seek the death penalty. The twenty six
Speaker 2: year old Ivy League graduate was indicted on a federal
Speaker 2: murder charge in the killing of United Healthcare CEO Brian Thompson.
Speaker 2: Mangioni's indictment, returned by a federal grand jury in Manhattan,
Speaker 2: includes a charge of murder through the use of a firearm,
Speaker 2: which carries the possibility of the death penalty. I've been
Speaker 2: talking to Dave Ahrenberg, former Palm Beach County State Attorney.
Speaker 2: Why are the Feds bringing charges as well as the state.
Speaker 3: The Feds have a time for here. Number One, they
Speaker 3: get to show that they are tough on crime, that
Speaker 3: they are reversing the Biden error policy on having a
Speaker 3: moratorium on the death penalty. And number two, they get
Speaker 3: to own the libs. I mean, those are two big
Speaker 3: motivations for this administration because Luigi Mangioni support really comes
Speaker 3: from folks on the left who hate insurance companies and
Speaker 3: treat Luigi as a hero for what he did. And
Speaker 3: so the Trump administration gets to burnish their tough on
Speaker 3: crime credentials while at the same time upsetting those who
Speaker 3: never supported them to begin with, upsetting the people who
Speaker 3: are the most strident anti Trump advocates. And that's why
Speaker 3: they're doing what they're doing, even though because I got
Speaker 3: to believe they don't really believe they're going to get
Speaker 3: the death penalty in New York. New York is a
Speaker 3: blue state, and you have to get a unanimous jury
Speaker 3: to impose a death penalty there, and that's going to
Speaker 3: be really, really hard to do, especially because you've got
Speaker 3: a young guy with no criminal record, who is good looking,
Speaker 3: in a cause celeb and just the reality it's tough
Speaker 3: in those kinds of cases to give someone capital punishment.
Speaker 2: All the reasons you gave for why the federal government
Speaker 2: is bringing these charges are political reasons, not legal reasons,
Speaker 2: not based on a pursuit of justice.
Speaker 3: Well, those reasons I gave are the reasons why they're
Speaker 3: seeking the death penalty. Now, as far as reasons why
Speaker 3: they're prosecuting the case, I would add that I do
Speaker 3: think there is a feeling within the Trump administration that
Speaker 3: New York prosecutors are not to be trusted because in
Speaker 3: this case, the DA is Alvian Bragg Junior, who is
Speaker 3: the prosecutor prosecutor Donald Trump in Manhattan.
Speaker 2: And he got a conviction. I don't know why they
Speaker 2: don't trust him.
Speaker 3: Well, yeah, they don't trust him because they think he's political,
Speaker 3: and they don't They just don't like him. So they
Speaker 3: are using themselves as a backstop to make sure that
Speaker 3: this case gets treated in the right way and as
Speaker 3: harshly as they believe it should be treated. They don't
Speaker 3: trust Alvin Bragg for the reasons I just mentioned. So
Speaker 3: for all these reasons, yes, a lot of them are political,
Speaker 3: but keep in mind the evidence is overwhelming against luigim MANJIONI.
Speaker 3: Although I don't think he'll get the death penalty, I
Speaker 3: don't think there's any doubt that he'll be convicted I mean,
Speaker 3: he wrote a confession, they got pictures of him clearly
Speaker 3: as the guy who did it, from the hostel to
Speaker 3: the on the street, and it really was a cowardly
Speaker 3: thing to do. I mean, if you have a beef
Speaker 3: in the insurance company, you don't lie in wait, wear
Speaker 3: a mask, shoot someone in the back and run away.
Speaker 3: That's cowardly. He's a hero.
Speaker 2: There's a ton of evidence. I'm not saying that. I'm
Speaker 2: just disagreeing about the FEDS bringing charges and getting around
Speaker 2: the double jeopardy because this doesn't look like a case
Speaker 2: that the FED should be involved in. He's going to
Speaker 2: be tried in New York. It's a state crime.
Speaker 3: Yes, but there are other cases where the Feds.
Speaker 2: Will I know, and I disagreed with those two. They're
Speaker 2: able to get around that not being tried twice for
Speaker 2: the same crime.
Speaker 3: But it's a separate sovereign you know, you're allowed to
Speaker 3: try people twice if it's not the same exact crime.
Speaker 3: In the federal and the state are also you know,
Speaker 3: they're separate sovereigns. So it happens. Now. One time it
Speaker 3: didn't happen was when the state decided to prosecute Paul
Speaker 3: Maniford after he was pardoned by Donald Trump at for
Speaker 3: federal crimes, and the state of New York tried to
Speaker 3: do that and the state Supreme Court said, Nope, can't
Speaker 3: do that here. But it doesn't work quite that way
Speaker 3: the other way around.
Speaker 2: And Mangioni's lawyers are arguing that the Attorney General, Pam Bondi,
Speaker 2: announcing that she was ordering prosecutors to seek the death
Speaker 2: penalty before he was indicted was a stunt, political stunt
Speaker 2: that corrupted the grand jury process and derived him of
Speaker 2: his constitutional right to do process.
Speaker 3: I disagree. It may have been a political stunt, but
Speaker 3: it doesn't deprive him of his right to do process.
Speaker 3: It didn't taint the grand jury. I mean, the grand
Speaker 3: jury did what they did. They focus on the evidence
Speaker 3: and the law, and there's plenty of evidence to indict
Speaker 3: him for first degree murder at the state level and
Speaker 3: for the federal charges as well. So I don't think
Speaker 3: it handed the jury have been political stunt. But you know,
Speaker 3: these are the types of things that happen, you know,
Speaker 3: you know what else is the political stunt? When Eric
Speaker 3: Adams walked with the armed team surrounding Luigim Mangoni on
Speaker 3: the way to court, Like, what was that about. I mean,
Speaker 3: this case is politicized from the beginning.
Speaker 2: That was a political stunt, there is no doubt about it.
Speaker 2: I mean the response to that was why is he
Speaker 2: escorting him? Everybody wanted a piece of Luigi Mangoni's fame
Speaker 2: or infamy.
Speaker 3: That was awful. Politicians shouldn't be the mess around the
Speaker 3: criminal justice system because and only jeopardizes cases when you
Speaker 3: do that. But even that, I thought that was over
Speaker 3: the top, that Eric Adams shouldn't have been walking with
Speaker 3: the armed law enforcement officers who are escorting luigim Angoni.
Speaker 3: But even that, I don't think the prize them all
Speaker 3: right to a fair trial. I mean, this is the
Speaker 3: case that everyone's going to hear about, everyone's going to know,
Speaker 3: people are going to draw their own opinions, and you
Speaker 3: just have to find a jury that will set aside
Speaker 3: what they know and any buas they have and just
Speaker 3: follow the evidence of the law. And I've seen that
Speaker 3: happen in every high profile case, and I've been involved
Speaker 3: with a few of them, and you can always find
Speaker 3: a jury. I mean, they found a jury for Donald Trump.
Speaker 3: Everyone knew about him and everyone had opinions about him.
Speaker 3: But yet they found an unbiased jury in Manhattan that
Speaker 3: listened to the evidence and followed the law.
Speaker 2: In New York, though, it seems like the case has
Speaker 2: been overcharged with the first degree murder charges that have
Speaker 2: to be in furtherance of an act of terrorism, which
Speaker 2: the legal definition of his intent to intimidate or coerce
Speaker 2: the civilian population or a government unit, And that doesn't
Speaker 2: seem to be the case here. First of all, was
Speaker 2: in the early morning hours when there was no one around.
Speaker 3: I agree with you, I think the case is overcharged
Speaker 3: in New York. New York is a weird system where
Speaker 3: it's not first degree murder unless it has some sort
Speaker 3: of enhance or like some sort of extra like terrorism.
Speaker 3: So that's why Alvin Bragg got that indictment about terrorism,
Speaker 3: even though really isn't an act of terrorism. I don't think,
Speaker 3: I mean, was he trying to intimidate the public. His
Speaker 3: writings said that he was trying to avoid any public cash,
Speaker 3: any innocence. He was trying to avoid that, and he
Speaker 3: focused entirely on this one individual. And you see by
Speaker 3: the public support behind him, it's not exactly he was
Speaker 3: trying to terrorize people. If anything, he was trying to
Speaker 3: galvanize them behind him and his cause to fight against
Speaker 3: the insurance company. So I think that's like a square
Speaker 3: peg in a round hole. I think it's gonna be
Speaker 3: hard for them to get that enhancer. And that is
Speaker 3: another reason why the FEDS have come in. I think
Speaker 3: fed saw that saw that they really don't have a
Speaker 3: true first or murder statue that applies here in New York.
Speaker 3: So let's come in with our own, and not only
Speaker 3: will we ensure he gets life in prison, we'll even
Speaker 3: seek the death penalty, which again not going to happen,
Speaker 3: but I do think they'll ensure that he never spends
Speaker 3: a day outside the prison for the rest of his life.
Speaker 2: Let's turn down to the case against p Diddy. Opening
Speaker 2: statements in the trial are set for May twelfth. What
Speaker 2: are the charges against him? Because the prosecution has updated
Speaker 2: the indictment three times.
Speaker 3: In the Didty case, the he did superseding indictments, which
Speaker 3: was expected. What they've done is they've added parties to it,
Speaker 3: new victims, They've added more detail to it. There's more
Speaker 3: counts now, so you know that's what happens in these
Speaker 3: types of cases. When more information comes forward, and did
Speaker 3: he wanted a postponement saying there's all these new victims
Speaker 3: now to like two more victims, we need more time
Speaker 3: to prepare. But those victims were mentioned in the first
Speaker 3: superseding indictment back into January, and so they've got plenty
Speaker 3: of time to prepare for trial. The trial is going
Speaker 3: in the beginning of May, and so they had had
Speaker 3: enough time. Plus even if these individuals were not mentioned
Speaker 3: until January. Did he knew what was going on? He
Speaker 3: knew what he did, and so it's not like any
Speaker 3: of this stuff is a big surprise for him. His
Speaker 3: attorneys may not have known exactly what the charges would
Speaker 3: it be, but they knew with plenty of time for
Speaker 3: the May trial.
Speaker 2: I was surprised that he didn't get bail. I mean,
Speaker 2: they could have had electronic monitoring of him so he
Speaker 2: wouldn't escape the country. Why do you think they didn't
Speaker 2: give him any bail at all?
Speaker 3: Because he's a rich guy who has tried to tamper
Speaker 3: with witnesses. So you've got tampering with witnesses, and you've
Speaker 3: got person with means who lives in Miami right on
Speaker 3: the water, easy to send a boat, just get out
Speaker 3: of dodge. So I think it was the right move
Speaker 3: to keep behind bars. You want to do justice for
Speaker 3: the victims here, and there's no justice. So he's able
Speaker 3: to leave to a country that has no extradition policy.
Speaker 2: Have they indicated yet what the defense will be.
Speaker 3: His defense is going to be consent for the victims
Speaker 3: of the human trafficking. He's going to say that these
Speaker 3: parties are these are all adults, these are not miners,
Speaker 3: So consent is a defense, and these were people who
Speaker 3: engage in these, you know, these acts and it's a
Speaker 3: money play that afterwards that he is being sued by
Speaker 3: some and all these allegations going around. So it's really
Speaker 3: going to be consent is the main defense here.
Speaker 2: You think he will take the stand. Any chance interesting
Speaker 2: always a chance.
Speaker 3: But whenever you have a big celebrity, you know, who
Speaker 3: make a living off the support of the public, where
Speaker 3: you have to convince them that you are someone who
Speaker 3: is likable and talented, and I think that they're more
Speaker 3: inclined to take the stand. Now, I bet he and
Speaker 3: this guy's a big ego, he'll want to take the stand.
Speaker 3: His lawyers may say, no, no, no, you do that
Speaker 3: and they're going to bring in all this other stuff
Speaker 3: that they otherwise can't bring in. So I say, it'll
Speaker 3: depend how it's going. Depends how it's going. If it
Speaker 3: looks like it's going badly, then that's the hill Mary pass.
Speaker 3: Then he'll take the stand. If it looks like the
Speaker 3: prosecution has not proved its case, then he is sitting
Speaker 3: there with a zipper over his mouth.
Speaker 2: I'm trying to remember the last time he was tried
Speaker 2: in New York, years and years and years ago. I
Speaker 2: think was on the gun charge. Johnny cochrane was his
Speaker 2: defense lawyer. That's how long ago that was. So several
Speaker 2: big cases happening in the Manhattan courts. Once again, thanks
Speaker 2: so much, Dave. It's always a pleasure. That's Day Ehrenberg,
Speaker 2: former Palm Beach County State Attorney. In less than a year,
Speaker 2: two judges have found that Google is a monopolist, and
Speaker 2: now Google is facing the ultimate threat that Microsoft faced
Speaker 2: more than twenty five years ago, as the government tries
Speaker 2: to break up the tech giant. A hearing kicked off
Speaker 2: today in Washington, d C. To decide the remedy after
Speaker 2: a federal judge's decision last August that Google's search engine
Speaker 2: is a monopoly. This comes just days after a federal
Speaker 2: judge in Maryland ruled in a separate case that Google
Speaker 2: illegally monopolized the market for online advertising technology. Joining me
Speaker 2: is Justin Teresi, Bloomberg Intelligence antitrust analyst. Justin can you
Speaker 2: explain that one hundred and fourteen page decision by Judge Brinkman.
Speaker 1: So, I think this is one of those cases where
Speaker 1: the facts of the matter are actually far more complicated
Speaker 1: than the law underpinning it, right, So I'll do my
Speaker 1: best to break it down for you. That's right, So Google,
Speaker 1: And this is important too. The case is really limited
Speaker 1: to something called open web display advertising. And what I
Speaker 1: mean by that is when you go to a desktop
Speaker 1: version of a website, think about those little rectangular or
Speaker 1: square ads that you see on the web page itself.
Speaker 1: So think like local newspapers or you know, something like that,
Speaker 1: where you go to the website and you see those ads.
Speaker 1: What's not in the market here really important, I think
Speaker 1: to the remedies phase is that we're not talking about
Speaker 1: mobile ads, the mobile versions of a website. We're not
Speaker 1: talking about the ads you might see in an app.
Speaker 1: We're not talking about the ads you might see in
Speaker 1: connected TV platforms where you might see something streaming. So
Speaker 1: that's kind of the nuts and bolts of what we're
Speaker 1: looking at the three different markets. Google has a business
Speaker 1: on both the buy sides, so folks looking at place advertisements.
Speaker 1: The sell side, so the folks with websites looking to
Speaker 1: sell that space. Then there's that ad exchange in the
Speaker 1: middle that kind of match us up the right consumer
Speaker 1: with the right website to see the right ad at
Speaker 1: the right time. So that's kind of the three different
Speaker 1: markets to your point. That's right, that the buy side,
Speaker 1: the folks looking at place advertisements that fell out of
Speaker 1: the liability funding with the judge fund that that particular
Speaker 1: side of the market really had a very active competitive
Speaker 1: marketplace existing in it.
Speaker 2: And so why did she find that the other two
Speaker 2: were monopolized?
Speaker 1: Sure, so on the cell side with the publishers who
Speaker 1: are looking to have folks buy ad space on their site,
Speaker 1: Google has over a ninety percent market share on that side, right,
Speaker 1: So not too difficult to see why. You know, a
Speaker 1: monopolization claim might have an easy time with some success there,
Speaker 1: but really when it comes down to it, you know
Speaker 1: that side was kind of tied to this AD exchange
Speaker 1: in the middle in an illegal way. And the reason
Speaker 1: why is that Google had all this real time demand
Speaker 1: that it was serving through this ad exchange in the middle,
Speaker 1: and in order to get access to that real time
Speaker 1: demand to make the best business decisions you could, the
Speaker 1: publishers for their websites had to use that Google cell
Speaker 1: side platform in order to access that demand in the middle.
Speaker 1: So that's really the tying that perpetrated the There was a.
Speaker 2: Lot of emphasis on double click and ad meld, and
Speaker 2: she found that those acquisitions were not anti competitive, right.
Speaker 1: So you're right, she didn't find that those acquisitions were
Speaker 1: anti competitive. It was more a question of what they
Speaker 1: did with those companies once they bought them, right, So
Speaker 1: they were able to kind of institute these policies that
Speaker 1: again tied those two different things together, the AD server,
Speaker 1: which was the Double Click for Publishers and the AD exchange,
Speaker 1: and those policies they put in place that would ended
Speaker 1: up being the issue. So what they would say is, hey,
Speaker 1: you know, folks using our double Click for Publishers platform,
Speaker 1: you know our AD exchange, they're going to get a
Speaker 1: first look at the bids that are out there. From
Speaker 1: our competitors. So kind of like think of it this way,
Speaker 1: A write a first refusal in many ways, you know,
Speaker 1: against other advertising exchanges. And then also they had a
Speaker 1: policy for a while called last look. So think about
Speaker 1: an auction at Seaby's or something, right, And the judge
Speaker 1: actually loved this analogy and so I'm kind of ripping
Speaker 1: her off with it. But you know, imagine everybody else
Speaker 1: puts their bid in an envelope and you're also a bidder.
Speaker 1: You see everybody else's big, and then you decide, hey,
Speaker 1: I'm going to beat everybody else because I know what
Speaker 1: they are. And that's the kind of policies that Google
Speaker 1: had in place that were found to be the problem.
Speaker 2: Google says it's going to appeal big surprise. It was
Speaker 2: a big surprise or no surprises. So what are the
Speaker 2: possible remedies in this case?
Speaker 1: So I think a lot of folks are talking about
Speaker 1: a potential divestiture for the publisher, ad server the cell
Speaker 1: side here, But I have to tell you I kind
Speaker 1: of don't think we're going to see that. And the
Speaker 1: reason why is that, you know, well, it's certainly on
Speaker 1: the table and more here than in the search case.
Speaker 1: I think, you know, this tying of the two products
Speaker 1: together that really seemed to be the issue. And at
Speaker 1: the trial itself there was testimony from rival publisher ad
Speaker 1: servers and from publishers who didn't want to be on
Speaker 1: that product anymore, and when asked what was the issue,
Speaker 1: they said, time and time again, we need that real
Speaker 1: time and demand from the ad exchange. And it seems
Speaker 1: to me that if you were to stip that tie
Speaker 1: and stop the policies from perpetrating the way they are,
Speaker 1: that probably goes a long way to resolve the anti
Speaker 1: competitive findings of the court itself. Again, to your point,
Speaker 1: the acquisition weren't found to be anti competitive. The problem
Speaker 1: is how they behaved with those acquisitions once they were made.
Speaker 2: And starting today there's a hearing on remedies in the
Speaker 2: other antitrust case against Google, which was decided last August,
Speaker 2: involving search tell us about that.
Speaker 1: You know, I think similar to what we're seeing in
Speaker 1: the ad tech case. So there has been a finding
Speaker 1: by the court in the search related case that Google
Speaker 1: has maintained its monopoly, and again the distinction being that,
Speaker 1: you know, the court didn't find that Google bought its
Speaker 1: way into that monopoly in search. But the court is
Speaker 1: again saying, is that you know, you developed search in
Speaker 1: your own homegrown way. The court credited Google a lot
Speaker 1: with their own kind of effort to make itself the
Speaker 1: search monopoly it is, versus buying it from someone else.
Speaker 1: But what they've done is they've entered these exclusivity agreements
Speaker 1: with folks like Apple, so that Google search mechanism would
Speaker 1: be that underlying platform. Whenever you use Safari or Siri,
Speaker 1: it's running its search is over Google's search product, right,
Speaker 1: So and so doing Google's retained that kind of trained
Speaker 1: knowledge and its search engine and its competitors allegedly, well,
Speaker 1: I suppose found by the court can't really get to
Speaker 1: scale because it's not having that learning through its algorithms
Speaker 1: the way that Google search is.
Speaker 2: The last time the government tried to break up a
Speaker 2: company like this was more than twenty five years ago
Speaker 2: with Microsoft. What exactly is the government proposing here?
Speaker 1: The way we're looking at this, I think is in
Speaker 1: many ways it's kind of like an opening salve vote
Speaker 1: in a negotiation.
Speaker 4: Right.
Speaker 1: And when I say that, what I mean is, you
Speaker 1: know the government's kind of coming in here asking for
Speaker 1: a divestiture of Chrome, which I don't think goes a
Speaker 1: long way to solve the actual competitive harms found by
Speaker 1: the court, the agreements of the problem, and the government
Speaker 1: also for a time at least was looking for Google
Speaker 1: to divest its investments in the AI space. Kind of
Speaker 1: argument that that contributes to the problems here with search
Speaker 1: as well. But realistically, you know, I think when we
Speaker 1: step back for a moment and look at the problem again,
Speaker 1: it was these exclusivity agreements. Perhaps what Google, you know,
Speaker 1: would be forced to as a remedy is share some
Speaker 1: of its data profiles or share some of its learning
Speaker 1: tools with competitors they could get to scale. Perhaps you
Speaker 1: see efforts to allow a choice screen on a phone,
Speaker 1: which is being done in Europe now. Right, So when
Speaker 1: you go to do a search, you don't automatically end
Speaker 1: up with Google Chrome, but there are other search engines
Speaker 1: that you can choose, and you know, perhaps that lends
Speaker 1: a little bit more of a push to competitors.
Speaker 2: I mean, Google is a verb. What's left of Googling
Speaker 2: or Google if they have to divest.
Speaker 1: That, it is absolutely a verb, and I think in
Speaker 1: many different spaces to your point, so Chrome, Chrome is
Speaker 1: the browser, right, So that is, I suppose the tool
Speaker 1: to access the search engine itself. So we're not talking
Speaker 1: about Google devesting its search engine. We're talking about that
Speaker 1: browsing tool that gets you to the search engine. Right,
Speaker 1: So you could still go to Google dot com, for example,
Speaker 1: on Microsoft Edge or through your Safari browser if it's
Speaker 1: not automatically pointed at Google, and you can access Google
Speaker 1: Search that way. And I have to say, June, this
Speaker 1: is really interesting too. You know, at the trial itself,
Speaker 1: there was expert testimony about all these preset kind of defaults,
Speaker 1: and the reality is you're right, any consumer can use
Speaker 1: a different browser or go to a different search engine.
Speaker 1: That's true, But the court seems swayed by an expert
Speaker 1: at trial who testify folks are a little bit lazy.
Speaker 1: They don't want to They're not going to go to
Speaker 1: a different search engine if it's actually offered up to
Speaker 1: if one's right there in their face for them to
Speaker 1: go to.
Speaker 2: Some of Google's partners, like Apple, probably won't be too
Speaker 2: happy with some of these suggested remedies.
Speaker 1: Right from a lot of the way things look. Apple
Speaker 1: has a lot to lose right now in terms of
Speaker 1: the search case, in the sense that Google's actually paying
Speaker 1: Apple about twenty billion dollars a year to have these
Speaker 1: default kind of presets for Google search engine, audits devices,
Speaker 1: and you know, behind Safari, behind Siri, and Mozilla also,
Speaker 1: which operates Firefox, receives about four hundred five hundred million
Speaker 1: dollars a year for the same regarding its browsers. For
Speaker 1: a big company like Apple, that definitely hurts. But Mozilla,
Speaker 1: a really small company, a four hundred five hundred million
Speaker 1: dollar payment per year could really means survival of the
Speaker 1: company itself. So there are a lot of actors involved,
Speaker 1: and a lot that could play out for companies outside
Speaker 1: of just Google.
Speaker 2: So you think that this might be a prelude, sort
Speaker 2: of like Microsoft settled, a prelude to a settlement.
Speaker 1: It could be. You know, with Search, I think things
Speaker 1: are pretty far along, but I think you know, in
Speaker 1: terms of a settlement coming together, You're right, anything could
Speaker 1: happen while we're waiting for a remedy to be handed
Speaker 1: out on the Search case. Same thing with the ad
Speaker 1: Tech case, where we're working on remedies there. The government
Speaker 1: certainly can settle claims at any time it wants to
Speaker 1: during that phase or even up through an appellet process,
Speaker 1: which is what happened in Microsoft, right, We were well
Speaker 1: into an appeals process before a settlement happened there. So
Speaker 1: you know, the court will find what it's fine, the
Speaker 1: appeals court will say what it says. But at the
Speaker 1: end of the day, there's a lot of time here
Speaker 1: left and a lot of runway left for the government
Speaker 1: to settle claims if they want to have the actual
Speaker 1: ultimate say here.
Speaker 2: And the Google case is different from the medic case
Speaker 2: because Google actually developed what's at stake here, while Meta
Speaker 2: bought the competition.
Speaker 1: To your point, I think that's a lot of what
Speaker 1: the court was saying in both of these findings too,
Speaker 1: is that there has been given some degree of credit
Speaker 1: to Google for actually developing all of this, know how
Speaker 1: on their own. They haven't just run out and acquired
Speaker 1: a lot of these subsidiaries that are issue here. So
Speaker 1: your points well taken. I'll tell you myself personally, I
Speaker 1: love Google Search too. I don't know that I trust
Speaker 1: everything else.
Speaker 2: Now, the final step is going to be well not
Speaker 2: the final step because there's President Trump possibly intervening, but
Speaker 2: these are all going to go to the Supreme Court.
Speaker 1: There's a high likelihood and not even just because we're
Speaker 1: talking about a large defendant like Google. I think we're
Speaker 1: talking about areas of antitrust law that really haven't been
Speaker 1: tested for a very long time here, right, and there
Speaker 1: are a lot of them with both of these cases.
Speaker 1: The ad Tech case specifically, we're talking about refusals to deal.
Speaker 1: On how far that goes. I think Google still will
Speaker 1: fight that fight, even though they lost the trial court
Speaker 1: on appeal. We're talking about two sided transaction markets, all
Speaker 1: of these these kind of corners and you know, nitty
Speaker 1: gritty of edit trust law where there's a lot of disagreement.
Speaker 1: Folks love to have a lot of theoretical conversations about them,
Speaker 1: but when it comes to black letter law, we're kind
Speaker 1: of starving for it in some ways. From the court.
Speaker 2: I mean, we're talking about if there's no settlement years
Speaker 2: and years before this is finalized.
Speaker 1: I think that's accurate. I think we're looking at a
Speaker 1: one to two window for just an appellate review of
Speaker 1: some kind, even in the Search case. But yes, I
Speaker 1: think we're looking at a long time down the road here.
Speaker 1: Google showed no signs of kind of going away quietly either.
Speaker 2: I don't think anyone expects Google to go away quietly.
Speaker 2: Thanks so much, Justin. That's Bloomberg Intelligence antitrust analyst Justin Terteresi.
Speaker 2: And that's it for this edition of The Bloomberg Law Show.
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