My Style - Reclaim My Identity : April 2018

Monday, April 30, 2018

Stephanie Clifford aka Stormy Daniels Files Questionable Defamation Suit Against Donald Trump In New York: Analysis

It's always something.

In my last update on the Donald Trump/Stormy Daniels/Michael Cohen saga, I described the hearing at which Michael Cohen asked United States District Court Judge James Otero to stay — that is, freeze — Stormy Daniels' lawsuit in federal court in Los Angeles, in which she seeks a declaration that her $130,000 hush-money deal with the President of the United States is invalid, and in which she sues Michael Cohen for defamation. Michael Cohen filed the declaration Judge Otero demanded, committing to taking the Fifth in the Los Angeles case. Judge Otero then granted Cohen's motion in a thoughtful and thorough order. So, for those keeping score at home: there's an ongoing federal criminal investigation of the Stormy Daniels hush money deal in New York, and there's Stormy Daniels' lawsuit in Los Angeles, which is temporarily stayed.

That was too calm. Now Stormy Daniels, through her not-exactly-media-shy attorney Michael Avenatti, has sued Donald Trump for defamation in federal court in the Southern District of New York — the same court where United States District Judge Kimba Wood is sorting out the disputes relating to the search of Michael Cohen's office. (As of this writing the case isn't assigned to a judge yet; it's possible that it would get transferred to Judge Wood as related to the matter before her.)

In the lawsuit, Ms. Daniels repeats her now-familiar account of a relationship with Trump. She says that in May 2011, when she was contemplating telling her story to In Touch, a man threatened her in a Las Vegas parking lot, telling her to forget the story. She recently released a sketch of her impression of the man who threatened her. The President of the United States, ever temperate and thoughtful of his lawyers' blood pressure, tweeted about the sketch:

In case you can't see the image, he said "A sketch job years later about a nonexistent man. A total con job, playing the Fake News Media for Fools (but they know it)!

(All quotations of the President of the United States are [sic])

Ms. Daniels claims that President Trump has accused her of fabricating the threat incident, and has therefore defamed her:

Mr. Trump's statement falsely attacks the veracity of Ms. Clifford's account of the threatening incident that took place in 2011. It also operates to accuse Ms. Clifford of committing a crime under New York law, as well as the law of numerous other states, in that it effectively states that Ms. Clifford falsely accused an individual of committing a crime against her when no such crime occurred. Mr. Trump's statement is false and defamatory. In making the statement, Mr. Trump used his national and international audience ofmillions ofpeople to make a false factual statement to denigrate and attack Ms. Clifford.

This is a weak claim, though perhaps (particularly in New York) not weak enough for the President to get it dismissed early.

Let's start with the basics. Only provable statements of fact can be defamatory. Insults, hyperbole, overheated rhetoric, pure opinion, and other things not reasonably interpreted as a statement of fact cannot be defamatory. One of the earliest questions in this case — and likely the one the President's lawyers will attack when they file a motion to dismiss the defamation suit — is whether Donald Trump's tweet can be taken as a provable statement of fact, as opposed to mere bluster, hyperbole, insult, and rhetoric.

This is not at all an idle question; the President has already won a case on this basis. In 2016, political strategist Cheryl Jacobus filed a similar defamation claim against Trump, asserting that Trump defamed her when he claimed in a tweet that she begged for a job and was rebuffed:

Really dumb @CheriJacobus. Begged my people for a job. Turned her down twice and she went hostile. Major loser, zero credibility.

In that case, a New York court dismissed the lawsuit against President Trump, finding that the tweet could not be taken as a statement of provable fact, but was hyperbole and political opinion. There are several important factors in this decision. First, the New York court noted that under New York law, whether a statement is fact or opinion is a question of law for the court — meaning that it can be resolved by the court on a motion to dismiss. Second, the New York court emphasized how important the context of the statement is in determining whether it is fact or opinion. When the statement in question is a Trump tweet, the context is a dumpster fire. Here's what that court said:

Moreover, the immediate context of defendants' statements is the familiar back and forth between a political commentator and the subject of her criticism, and the larger context is the Republican presidential primary and Trump's regular use of Twitter to circulate his positions and skewer his opponents and others who criticize him, including journalists and media organizations whose coverage he finds objectionable. (See eg Jasmine C. Lee & Kevin Quealy, The 289 People Places and Things Donald Trump Has Insulted on Twitter: A Complete List, The Upshot, NY Times [digital ed], Dec. 6, 2016,http://www.nytimes.com/interactive/2016/01/28/upshot/donald-trump-twitter-insults.html [accessed Jan. 8, 2017]). His tweets about his critics, necessarily restricted to 140 characters or less, are rife with vague and simplistic insults such as "loser" or "total loser" or "totally biased loser," "dummy" or "dope" or "dumb," "zero/no credibility," "crazy" or "wacko," and "disaster," all deflecting serious consideration. (Id.; see Technovate LLCv Fanelli, 49 Misc 3d 1201[A], 2015 NY Slip Op 51349[U], *4 [Civ Ct, Richmond County 2015] ["On-line speech often is characterized by the use of slang, grammatical mistakes, spelling errors, and a general lack of coherence."]; Ellyn M. Angelotti, Twibel Law: What Defamation and Its Remedies Look Like in the Age of Twitter, 13 J High Tech L 430, 433 [2013] ["The informal nature of conversation on Twitter tends to encourage people to talk more freely about others, including the spreading of rumors and potential falsehoods."]).

Based on that, the New York court dismissed Jacobus' suit against Trump.

Stormy Daniels' suit against Trump will face a similar challenge. The federal court will be applying the Federal Rules of Civil Procedure for procedural matters, but applying New York's substantive law of defamation. Here's a footnote if you want to know why, because it's dull.¹ Trump's lawyers will almost certainly file a motion to dismiss the case. The question before the federal judge will be whether, if all facts (as opposed to conclusions) in the complaint are taken as true, the complaint shows defamation under New York law. The President's lawyers will have a strong argument, boosted by the Jacobus case, that it does not, because his tweet can't be taken as a factual allegation. The context is (a) this President and (b) Twitter. Twitter in general, and this President on Twitter in particular, are widely understood by anyone familiar with the context to be full of bombast and truculent rhetoric, not reliable fact. This impression is enhanced by the figurative language ("con job") in the tweet and the way it was combined with an overtly partisan and opinion-based swipe at the news media. In short, the President's lawyers have a very credible chance of getting this thrown out on the basis that Trump's tweet can only be taken as trash talk, not as a literal provable statement that Daniels is lying.

Yes, that would make two courts that have found as a matter of law that the statements of the President of the United States cannot be taken factually or literally, but should be understood as bluster.

That's not the only problem with the case, but it's the biggest one and the one most likely to help the President at the motion to dismiss stage. I also note that there are issues with the allegations about President Trump's knowledge. Because Stormy Daniels is a public figure, to prove defamation she has to show that a false statement about her was made with "actual malice" — which in defamation context means with knowledge that it was false or reckless disregard about its falsity. She hedges her bets on that:

Given the circumstances surrounding the threatening incident in 20II, namely that Ms. Clifford had not at the time gone public with her story and very few people kmew of the possible In Touch story, it is reasonable to infer that the person who threatened Ms. Clifford could have only been acting directly or indirectly on behalf of Mr. Trump and/or Mr. Cohen. Thus, Mr. Trump may have actual knowledge of the incident and ofthe falsity of his statement.

Alternately, if Mr. Trump in fact had no direct or indirect connection to the incident, then Mr. Trump necessarily acted in reckless disregard of the truth or falsity of his statement because he would have no way of knowing one way or the other as to whether the incident occurred. Nevertheless, and in spite of this, he chose to defame and disparage Ms. Clifford to his audience of over 50 million Twitter followers and many more worldwide.

If President Trump knew the statement was false, that's actual malice. But the second paragraph doesn't describe actual malice. Actual malice requires reckless disregard of the truth, which means more than just extreme carelessness. Most courts — including New York courts — say that it requires that the defendant had serious doubts about the truth of the statement but made it anyway. It would be difficult, to put it mildly, to prove that President Trump entertains serious doubts about the things he says or tweets, or is capable of such doubt. Stormy Daniels' allegation of reckless disregard is insufficient as a matter of law.

New York doesn't have an anti-SLAPP statute — a statute providing a procedural vehicle to get rid of a bogus defamation case and recover attorneys fees, which is more powerful and flexible than a motion to dismiss. But here's the trick, and I don't know if Stormy Daniels' lawyers know it. Stormy Daniels is from Texas. Texas has a strong anti-SLAPP statute. And some federal courts will apply the anti-SLAPP statute of your state of origin if you file a defamation claim in federal court elsewhere. My friend and First Amendment badass colleague Marc Randazza pointed this out to me — in fact, Marc says, federal courts in the Second Circuit (which includes the court where Daniels filed this case) have applied anti-SLAPP laws from the home states of plaintiffs to cases there. That would give President Trump's lawyers a powerful tool, even more powerful than a motion to dismiss, to get rid of the case — and even to recover attorney fees.

This is not a strong defamation case; it's a very weak one, substantively and procedurally. Michael Avenatti isn't dumb, and it's possible his real strategy is less the ultimate success of the case but the additional vector of pressure it puts on Team Trump — it's one more place to drag Trump into court, one more place where she could conceivably seek discovery from Trump and Michael Cohen (who would presumably have to take the Fifth), one more move on the board.

As a federal criminal law and First Amendment practitioner, this is an amazing time to be alive.

Wednesday, April 25, 2018

"A First Amendment Issue" vs. "Absolutely Protected By The First Amendment" — A Common Free Speech Misunderstanding

In the last few years I've noticed a fundamental misunderstanding in how we talk about First Amendment law, particularly when wonks like me talk to normal people. The misunderstanding involves what it means for something to be a "First Amendment issue" or "governed by the First Amendment" or even "protected by the First Amendment."

Take, as the latest example, deeply silly and annoying Fresno State loudmouth Randa Jarrar. It's unequivocally clear: whether or not Fresno State can fire her is governed by the First Amendment. Put another way, it's a First Amendment issue, or her speech is protected by the First Amendment. You may not like it or agree, but that's the law.

But perhaps when I say those things, I'm not being clear about what I mean. People seem to take it as if I am saying "Randa Jarrar's speech is absolutely protected by the First Amendment and she can't be disciplined, case closed." But I'm not. I'm saying that the First Amendment is the source of the legal standard that governs whether she can be fired — that the Supreme Court has articulated a specific multi-step analysis to determine whether a state employer can fire a state employee for speech. If I mean to say "I've done the requisite First Amendment analysis and it's clear that under that process the end result is that her speech is absolutely protected," then I should say so clearly. Maybe I don't always.

Defamation cases are another good example. Nearly every time I say that the First Amendment applies to evaluating a defamation claim, people say "but defamation isn't protected by the First Amendment." This again confuses process and results. What I'm saying — and maybe I should say more clearly — is that established First Amendment caselaw shows us how to tell whether or not a statement is potentially defamatory (not protected by the First Amendment) or absolutely protected like pure opinion.

First Amendment wonks like me could make public dialogue more productive by being clear about this distinction, I suppose. The best analogy I can give is this. When I say "whether this person can be punished by this speech is a First Amendment issue/governed by the First Amendment," it's like I'm saying "whether this defendant is guilty is a question for the jury." I'm not saying the person will necessarily be found not guilty. I'm saying there's an established constitutional process. This isn't Nam, there are rules.

So: I'll try to be clearer when I'm saying "the end result is that the First Amendment protects this speech so it can't be punished" versus "the First Amendment provides the rules to determine whether this speech can be punished."

As you were.

Tuesday, April 24, 2018

About The Bogus Defamation Claim Against Lee Stranahan

Earlier today, in my angry mood at Tewksbury, I had Twitter words with one Lee Stranahan, self-styled journalist currently seen on Sputnik and InfoWars. That spat was tawdry and need not detain you. But it reminded me I hadn't mentioned a problematical defamation case about him.

Brennan Gilmore sued a whole pack of lunatic-fringe mock-journalists, including Stranahan, after the neo-Nazi murder of Heather Heyer at the "Unite the Right" rally in Charlottesville, Virginia. Gilmore observed and commented on the murder and posted a video on social media. Various lunatics, noting that Gilmore is a Foreign Service Officer, began pushing a narrative that he is a deep-state Soros-funded operative there to support a coup against Trump, with related word-salad. That's the world we live in.

Gilmore sued a bunch of them for defamation and intentional infliction of emotional distress, claiming entirely credibly that he'd been swamped with death threats as a result of their conspirabation. This post concerns only one small bit of that claim — the bit against Lee Stranahan. See, Stranahan was interviewed for an InfoWars video entitled "Bombshell Connection Between Charlottesville, Soros, CIA." The video features Stranahan Stranahanning:

STRANAHAN: If you go to Brennan Gilmore’s page, his Twitter page,
you’ll see he has a picture of the young woman who was murdered, and you
know what is says? “Martyr.” . . . Literally it says “martyr.” You can’t be
more explicit than this. So here’s what I’m saying. I’m not a conspiracy
theorist, I’m a fact-based journalist. The facts are enough. However, the
Democrats have investigated Trump for a lot less. For a lot less. They have
called for investigations, and secret meetings, they have convened the FBI.
When you have this many things going on, I think someone really needs to
investigate. . .

[MCADOO scrolls through Gilmore’s Twitter page]

STRANAHAN: Yeah, if you scroll…keep scrolling…this is the guy,
Brennan Gilmore, and if you scroll down, keep going, it’s not too far, you’ll
see the photo of the young woman…this is abs [sic]…when I saw this, uh,
I was shocked…by the way, his bio, if you look at this guy’s bio, it says
he’s with the State Department, and the fact that he called her a ‘martyr’. .
. I [STRANAHAN looks knowingly at the camera, eyebrows raised, arm
raised, MCADOO nods comprehendingly, laughs] don’t know, but this is
clearly, the way she’s being used is she’s a martyr to the cause. . . .

STRANAHAN: And let me point out what’s happening. They, uh, they win
no matter what they do. Are they trying to get a coup? I think clearly they
are. But if they can’t get a coup, they’ll settle for impeachment. And if they
can’t get impeachment, they’ll settle for smearing Trump and his supporters
so much that they’ll be able to elect another elitists. Does that make sense?

MCADOO: Absolutely.

This is the premise of Gilmore's defamation and intentional infliction of emotional distress claims against Stranahan. And it's bogus. Stranahan's speech is clearly protected by the First Amendment.

Only false statements of provable fact are potentially defamatory. The First Amendment absolutely protects opinion when that opinion is based on disclosed facts, however ludicrous and evil the opinion is. Here, Stranahan discloses his facts, which are undisputed: Gilmore had a picture of the Heyer and referred to her as a martyr, and Gilmore works for the State Department. From these undisputed facts Stranahan spins his opinion: these facts show a conspiracy against Trump, the conspiracy is trying to get a coup or impeachment or smear Trump supporters, and so on. It's an opinion only an evil or diseased mind would offer. But it's a protected opinion — just like my saying look at this specific thing Stranahan did, he's crazy or evil. If Stranahan had said "based on documents I've reviewed I think Gilmore is a Soros-paid deep state operative and organized the killing as a false flag," that would be potentially defamatory, because it's based on undisclosed facts — the "documents." Here, an opinion based on clearly disclosed facts — no matter how vile, moronic, or disturbed — is absolutely protected by the First Amendment. Similarly, because it's a discussion on a political matter of public interest, it's also almost certainly protected from the intentional infliction claim under Snyder v. Phelps.

Stranahan's lawyer Aaron Walker — whom you may recall had to fight for his own First Amendment rights against domestic terrorist Brett Kimberlin — has ably made this point in his motion to dismiss, along with other points beyond the scope of this post.

I think Lee Stranahan — who currently works for Sputnik, funded by a hostile foreign power seeking to undermine our nation and its values — is morally responsible for the threatening response his bizarre and contemptible speculation predictably generated from his scary audience. But he's not legally responsible. His speech is protected by the First Amendment, and should be. His consequence is to remain Lee Stranahan, admired by the sort of people who admire Lee Stranahan and scorned by everyone else.

I note that today Stranahan posted a video of himself ranting about me as he walked down the street. One of his points was that free speech is only valuable if it is premised on rational discourse. The quote above, willingly offered to InfoWars, is what he considers rational discourse. I refute it thus.

Monday, April 23, 2018

Dear DNC: We Need To Talk About RICO

Dear Democratic National Committee:

I'm sure you are all very excited about the big boisterous federal complaint you've filed against Russia, the GRU, Wikileaks, the Trump campaign, Rasputin, Richard Nixon, Jared Kushner, Al Gore for inventing the internet, and so on.

Can we talk?

I'm not going to hector you on all the legal and theoretical problems with your complaint. Other people who are smarter than I am are already doing that.

I just want to talk about one aspect . . . .

. . . . it's our little friend RICO.

DNC. DNC, my friend. It's almost never RICO, and throwing down RICO to signify THIS IS BIG is a move that puts legal strategy behind public relations.

RICO is a complex statute designed to address criminal organizations — by which I mean not organizations that do criminal things in pursuit of their goals, but organizations whose purpose is criminal. Stretched past that, it gets needlessly complex.

I understand. "RICO" is the new "awesome." It conveys, to people who don't understand it, "the things these people did are really bad and really criminal." It's a big frowny emoji. But the vast majority of the time it's far more trouble than it's worth in court.

First, federal judges hate RICO. They hate it because it's unseriously overused by litigants without enough confidence to let their core substantive claims speak for themselves. There are three groups that use RICO indiscriminately: pro se litigants complaining that the Bureau of Indian Affairs implanted SatNav in their junk, plaintiffs' attorneys of the sort who go to court in a sports coat they keep in their glove compartment, and professional vexatious litigants. That's why many federal judges often have standard orders they issue in civil RICO cases that say, in effect, "you think you have a valid RICO claim? Fine, answer these 20 complicated questions to help me sort it out." Judges don't do that for other claims. So: when you come into court with a RICO claim, you start (at best) with the judge suspicious of your professionalism and credibility.

Second, it's very difficult to allege RICO properly, and unusually easy to get a RICO claim dismissed for failure to allege it properly. The requirements are arcane. It's common for federal courts to dismiss them or, at least, for the plaintiff to have to make multiple attempts to plead them right. To quote Judge John G. Koeltl (who has drawn the DNC's case) in a 2016 opinion:

Courts have repeatedly warned against attempts by plaintiffs “ ‘to mold their claims to the RICO form even though their injuries do not fall within those intended to be addressed by the Act.’ ” Lefkowitz v. Reissman, No. 12cv8703 (RA), 2014 WL 925410, at *4 (S.D.N.Y. Mar. 7, 2014) (quoting Rosenson v. Mordowitz, No. 11cv6145 (JPO), 2012 WL 3631308, at *5 (S.D.N.Y. Aug. 23, 2012)). The alleged predicate acts of mail and wire fraud “ ‘merit particular scrutiny,’ ” id. (quoting Cohen v. Cohen, 993 F.Supp.2d 414, 423 (S.D.N.Y.2014)), lest the courts allow the RICO statute “to federalize garden-variety state common law claims,” id. (quoting Gross v. Waywell, 628 F.Supp.2d 475, 483 (S.D.N.Y.2009)).

Put another way, alleging RICO usually gives the defense a weapon — it allows them to file a credible motion to dismiss the RICO claim, which at a minimum will drag out the litigation. It often ensures you'll spend the better part of a year squabbling about how the complaint was drafted rather than getting to the heart of the matter.

Third, practically speaking, RICO is more bark than bite. Oh, sure — RICO has provisions for triple damages and forfeiture of assets and all that jazz. But that's all stuff that could hypothetically happen at the end of a case, years down the road. What does it get you now? Usually, very little more than bragging rights to say "I DID A RICO." The vast majority of federal cases are resolved short of trial through some method other than a judgment reflecting the full weight of what could have been won. Very occasionally (not in this case) RICO will provide your vehicle to get into federal court, in which case it might be worth it. But more often than not, it's mere signalling that doesn't have much impact on the outcome.

If there's a legal lesson from the Trump era, it's the one I suggested last Friday after the hearing in the Stormy Daniels v. Michael Cohen case — public relations strategy often conflicts with legal strategy. DNC, your lawsuit appears to reflect you going all-in on public relations strategy at the expense of effective legal strategy. I offer no opinion on how well this will work out in the court of public opinion (other than to restate my faith in your capacity to snatch defeat from the jaws of victory). But legally, your complaint appears drafted in a way that will be unnecessarily easy to attack in court — which, of course, detracts from the public narrative.

RICO is a mother-of-all-bombs type of thing: showy, but not necessarily effective. Go with precision drone strikes instead.

Guest Post: Paul Alan Levy On The Karen McDougal v. National Enquirer Settlement

Paul Alan Levy, an attorney at Public Citizen, bloger, and general free speech badass is familiar to Popehat's readers for his legal exploits. We're happy to have a guest post from him today.

The generally accepted narrative about the sudden settlement of Karen McDougal’s lawsuit against the National Enquirer (through its parent company, American Media, Inc.) for its “catch and kill” treatment of her account of her affair with Donald Trump is that the FBI’s April 9 execution of a search warrant at Michael Cohen’s office was what made the difference, coupled with the possibility that had the case continued, McDougal’s very able counsel, my friend Peter Stris would be able to start taking discovery that might prove very embarrassing to all concerned.

I believe that narrative to be mistaken. Certainly the prospect for discovery might have been a concern for some in the long run, but the narrative misses two points.

First, on April 2, a week before the search warrant execution, AMI moved to dismiss the complaint under the California anti-SLAPP statute; two weeks before that, the company had issued a statement about the lawsuit attacking Stris’s statements abut the situation. In both documents, the company said that it had already released McDougal from many of the restrictions on her communicating with the media about her experiences (the account that had been subjected to the catch and kill), allowing her to respond to legitimate press inquiries by talking about her situation. The company claimed that the only limit was on McDougal selling her story to another media outlet. The motion to dismiss went a bit further: it said that, in fact, the company had no desire to prevent McDougal from telling her story going forward (it pointed out, for example, that McDougal had given an extensive interview to Anderson Cooper). It argued that the lawsuit was really over the company’s having made editorial decisions not to carry in other of its publications various material about McDougal or written by McDougal, and it argued that suing it for the exercise of its editorial discretion implicated the company’s free speech in a way that warranted coverage under the anti-SLAPP statute.

My immediate reaction to this filing was that AMI was signaling its desire to drop the restrictions on McDougal’s speaking publicly, and that assuming that AMI’s position was sincere, the case was likely headed for a prompt settlement. And that is what has happened.

Moreover, at that point, McDougal faced a serious incentive to settle rather than litigate. I don’t say that AMI’s argument about SLAPP coverage was sound, but it was not a ludicrous argument (some of it depended on claimed facts of whose veracity I have no knowledge). But if the anti-SLAPP motion was granted, McDougal faced a serious award of attorney fees.

The second major point is that, in California, an anti-SLAPP motion generally puts a hold on discovery, and if the anti-SLAPP motion is denied, the denial can be appealed. So it was fairly unlikely that McDougal was going to be able to take discovery anytime in the next year or so, thus embarrassing the criminal law defense for Cohen or others, another prospect said to have produced the settlement.

Moreover, down the road, the very same discovery might go forward in the event either Keith Davidson or Cohen gets sued, as Stris has publicly threatened to do. And the settlement does not release McDouga’s possible claims against them. So the notion that AMI was buying itself protection against embarrassing discovery seems weakened for that reason as well.

Rather, it is my assumption that AMI responded to the terrible publicity that it was receiving for the alleged “catch and kill” situation by giving up its right to kill the story. But that surrender was already effective on the day the search warrant was executed.

None of this takes away from the excellent lawyering by Peter Stris to achieve this result for his client. But I think he deserves full credit for what he achieved, and need not share any credit with the authors of that FBI warrant.

Friday, April 20, 2018

Michael Cohen's Motion to Stay The Stormy Daniels Case Deferred, Cohen's Situation Pronounced Ominous

Today, in a mood for some history, I walked half a mile to the new federal courthouse to watch United States District Court Judge James Otero hear argument on Michael Cohen's motion to stay — that is, freeze — Stephanie Clifford's aka Stormy Daniels' lawsuit. That suit seeks a ruling that her bizarre $130,000 hush-money agreement not to tell tales about the President of the United States is void and not enforceable because, among other reasons, President Trump never signed it. I've previously described what the case is about and the nature and significance of Cohen's request for a stay. Although Judge Otero took the matter under submission — promising to rule in writing — the hearing did not disappoint.

I gathered with a scrum of press and interested citizens and surrendered my electronics at the door — an unusual move calculated to prevent livetweeting and other shennanigans. For the benefit of my readers who are federal clerks and judges that was totally unnecessary because I always obey all of your rules, naturally. Ms. Clifford was represented by the now-familiar Michael Avenatti and his associate. Michael Cohen was represented by Brent Blakely, whom I had not seen before. President Trump was represented, as narrative convention requires, by three white men with good hair whose names escape me, and who did not talk after introducing themselves to the court.

There were two themes to the hearing. One is that Michael Cohen's situation is grave. Judge Otero — a federal judge for 15 years, who has seen thousands of federal criminal cases — repeatedly commented that it was clear from the search of Cohen's office and subsequent proceedings before Judge Kimba Wood in New York that Cohen faced a strong probability of prosecution. "It's substantially likely some kind of criminal action will be filed," based on the nature of the search, Judge Otero said at one point. Later, based on his experience overseeing warrants, he opined "something big is going to follow."

The second theme of the hearing was that the parties' legal interests were at war with their political and public relations interests.

Cohen is in a bind: it's clear from the search of his office that the FBI is investigating the hush-money contract he brokered between President Trump and Stormy Daniels, and it would be imbecilic to anything but assert his Fifth Amendment privilege against self-incrimination in answer to all questions about that subject. But defending Stormy Daniels' case in Los Angeles would require him to answer questions to defend the validity and enforceability of the contract. If he takes the Fifth he almost certainly loses the civil suit and the contract is voided. There's a remedy for that dilemma — Judge Otero has the discretion to stay the civil case while the criminal case proceeds. Judge Otero is supposed to consider factors including the prejudice to Daniels if the case stops, the prejudice to Cohen if it moves forward, and the interests of the public.

But both Cohen's and Daniels' public interests conflict with their legal interests here. Most importantly, Cohen did not file a declaration stating that he was going to take the Fifth because he felt the questions in the Daniels case could incriminate him. He relied on his attorney's statements that he would. There was only one reason not to do that — because doing so would be an act that could be used against him in the court of public opinion, and if he didn't do it, he and his lawyers could continue to take the public stance that he hadn't decided yet — with the subtext that he probably didn't need to because he didn't do anything wrong. Judge Otero didn't like it, and repeatedly pointed out that though the record (for instance, the proceedings in New York) suggested that the criminal investigation and the Daniels case were on the same topic, there was nothing from Cohen confirming that he believed the proceedings would incriminate him — or explaining why his lawyers filed a declaration from him in the Daniels case even after the New York search (a genuine blunder). Avenatti pointed out that Cohen's failure to file a supporting declaration was purely tactical — he didn't even offer one in his reply after Avenatti called him out for it in the opposition. Ultimately Judge Otero didn't order him to file a declaration, but gave him until next Wednesday to do so, and strongly implied that doing so was necessary to win a stay.

Daniels' public behavior — and the behavior of her attorney, Avenatti — were just as adverse to their legal interests. One of the factors in deciding whether to stay the case is whether the stay would prejudice Daniels's interest. How, asked Judge Otero, is Daniels prejudiced, when she's repeatedly told her story on TV, and her lawyer has repeatedly been on TV to talk about the case? Hasn't she necessarily ignored the alleged chilling effect of the contract? Blakely snarked that Avenatti has talked about the case on TV 53 times — "54, if you count Bill Maher." Avenatti struggled to explain how Ms. Daniels was still laboring under Cohen's feckless bluster that he would win $1 million from each statement she made and go on vacation with the proceeds. But the judge was clearly skeptical that the threat of the hush money agreement was actually prejudicing her any more. Avenatti, too, had to eat his words. It was in his interests to argue that a stay was fruitless because the federal investigation could take years; Blakely twisted the knife quoting Avenatti's pronouncements that Cohen would be indicted within 90 days. Avenatti was forced to concede, in decorous terms, that his pronouncement was shit-talking.

In short, everyone's public bluster and press maneuvering detracted from their litigation interests. It is often thus.

Judge Otero's questions implied some meaningful points. First, there was a significant discussion of whether Cohen would be forced to take the Fifth in response to answers at a deposition, and whether the stay should be deferred until he is called upon to do so. That implies that Judge Otero is seriously considering Daniels' request for limited discovery to determine whether any contract was formed, and therefore whether Cohen and Trump can compel Daniels to arbitrate. Normally an arbitrator decides whether an arbitration agreement is enforceable — but a judge can allow limited discovery and a quick mini-trial on the question of whether the contract containing the arbitration agreement was ever formed in the first place. Daniels' theory is that it wasn't, and that a deposition of Cohen and Trump will prove it. If Daniels can compel discovery of Cohen — and maybe even the President — it will be momentous. Second, Judge Otero also suggested that he might carve out Daniels' claim for defamation against Cohen, which is premised on Cohen's comments about Daniels in the media. Cohen was filed a well-crafted anti-SLAPP motion to strike that claim and is not arguing that claim needs to be arbitrated. Because it's an issue of law, Judge Otero may reach it even if he does stay the case. Third, Judge Otero noted that if he rejects a stay, the ruling could be immediately appealable, pointing to more potential delay. (Any ruling on the anti-SLAPP motion is also immediately appealable.)

There was intensity, but there were moments of levity. Judge Otero dryly noted he might handle discovery disputes (which might include such lofty issues as executive privilege) himself rather than send them to a magistrate judge. There were audible snorts in the courtroom when Blakely characterized the matter as "just a contract case." And Avenatti and Blakely gleefully twisted knives at each other. Avenatti explained he wanted to proceed immediately because criminal proceedings could leave Cohen a pauper unable to pay a judgment; Blakely repeatedly threw shade at Avenatti's fondness for the camera.

Judge Otero asked tough questions of both sides, often asking questions which — in isolation — sounded like he was deciding one way or the other, only to point in a different direction a moment later. He was well prepared and skeptical of both sides, a model of what you want an independent judiciary to be. Both Blakely and Avenatti was well-prepared and effective advocates. Trump's lawyers looked concerned very competently.

The end result was this: Cohen has until next Wednesday to file a declaration supporting his request and establishing that he intends to take the Fifth. Avenatti can file a rebuttal within 24 hours. Then the judge will rule in writing. Based on my observation, I think that there's a strong chance that Cohen will lose the motion outright if he doesn't file the declaration. If he does, I suspect Judge Otero will grant a limited stay — not so much to preserve Cohen's interests in the civil case, but to give his lawyers a reasonable amount of time to get a grip on what is going on and make longer-term decisions about how to deal with the civil case. Judge Otero repeatedly noted that the criminal case could take a long time, but that it was reasonable for the lawyers to want to regroup to evaluate the situation and how to weigh Cohen's interests in the two matters. I also suspect Judge Otero will hear the anti-SLAPP motion against Daniels' defamation claim — it's a strong motion and a weak claim.

I'll report more as events warrant.

Thursday, April 19, 2018

Today in WaPo: The Fault Lies Not In Our Lawyers But Ourselves

I have a post up at The Washington Post today.

Wednesday, April 18, 2018

Lawsplainer: Can A State University Fire a Professor For Being An Ass On Twitter?

Yesterday Fresno State Professor Randa Jarrar effusively celebrated the death of former First Lady Barbara Bush on Twitter.

Lots of people are clamoring for her to be fired.

Can she be, legally, consistent with the First Amendment?

Maybe.

I've written plenty of times before about the relevant legal analysis. I also discussed the lead case on the issue, and interviewed its plaintiff, in Episode Three of the "Make No Law" podcast. Here it is again, in shorter form:

Generally, the First Amendment prevents only the government, not your employer, from punishing you for your speech. But what if the government is your employer? Well, then the First Amendment offers you some protection from being punished by your employer for your speech. That protection is governed by a multi-stage analysis.

The first stage of the analysis is a question: was the public employee speaking on a matter of public interest? The quality or decency of the speech does not factor into this question. Here, Jarrar was making political comment on the death of a public figure. It's a matter of "public interest," as that is defined in the relevant cases. Had she tweeted about some purely internal matter — for instance, about how terrible her teaching assistant is — it would not have been.

The second stage of the analysis is another question: was the government employee acting as a private citizen, or as part of their job duties? If they were speaking as part of their job duties, the First Amendment doesn't protect them. There's a relevant emerging area of law here: that rule probably doesn't apply to public university professors. So, most likely, the First Amendment protects a state university professor even if they are speaking as part of their duties — with respect to the content of their classes, for instance.

Here, it seems clear that Professor Jarrar was not tweeting in the course of her duties as a professor. She was apparently on leave at the time and the scope of her duties do not include Twitter. Fresno State proclaimed in a tweet that she was speaking in her private capacity. (That was a clear reference to this analytical structure.) Therefore, we get to the next step of the analysis without having to address the emerging area of law about state college professors.

The third stage of the analysis involves a balancing test: the interest of the public employee against the interest of the public employer in promoting the efficient delivery of public services. This is by far the most touchy-feely part of the analysis. Can the government employer show that the speech in question so disrupted the workplace that it interfered with orderly business in a way that outweighs the employee's speech rights? A court is likely to give more weight to the employee's speech right if freedom of expression is an inherent part of the job, as it is (or ought to be) for a college professor. For instance, the Supreme Court has said:

Our Nation is deeply committed to safeguarding academic freedom, which is of transcendent value to all of us, and not merely to the teachers concerned. That freedom is therefore a special concern of the First Amendment, which does not tolerate laws that cast a pall of orthodoxy over the classroom. "The vigilant protection of constitutional freedoms is nowhere more vital than in the community of American schools.

So, to justify firing someone like Professor Jarrar, a state school would need to demonstrate that her speech caused rather substantial disruption of education. Of course, Professor Jarrar may have made it easy for them:

She also provided a telephone number as if it was her contact number. But the listed number ended up going to a suicide/crisis line.

Causing your school's suicide hotline to be flooded with troll phone calls presents a very arguable case for substantial disruption, depending on the evidence.

(If you think that this structure creates an incentive to react disruptively to speech, in order to supply a basis for a professor to be fired, you'd be right. If you think that schools might lie about the amount of disruption, you'd be right.)

My assessment: Professor Jarrar was speaking as a private individual on a matter of public interest. It would be difficult for Fresno State to establish that the tweets about Barbara Bush themselves caused the sort of disruption of the school's business that so outweighs her free speech interests so that it would justify her termination. However, her tweet directing people to the school's suicide hotline presents a substantially stronger case for disciplinary action by the school.

Note that this analysis does not address other limits on discipline against her, such as California state law and the union contract between Fresno State and its professors.

Also beyond the scope of this post: effusive condemnations of her behavior, discussions of which "side" is hypocritical about free speech, discussions of foreign policy circa 1988-1992, etc.

Monday, April 16, 2018

Lawsplainer: Michael Cohen's Attempt To Delay The Stormy Daniels Litigation

Oh my God. Oh my God. Ohmigod ohmigod OMG.

Now what?

This Michael Cohen thing.

You're going to have to be way more specific.

He's trying to take the Fifth! He wants the Stormy Daniels lawsuit stopped so he can take the Fifth!

Well. Sort of.

Isn't that huge?

Yes and no.

That's not helpful. You're not being helpful.

Imagine my guilt. What is it that you want to know about? What part of the Stormy Daniels lawsuit don't you understand?

Just a tiny bit of it. Just a bit. Some. Part of it. Just part . . . all of it. I don't understand any of it. I don't know what's going on, I just nod when people talk about it.

Okay. Let's start from the beginning.

So. Stormy Daniels, whose real name is Stephanie Clifford, claims she had a relationship with Donald Trump in 2006 and 2007. She claims that when the infamous "grab them by the pussy" Access Hollywood tape became public, she wanted to tell her story to the media. Once she started shopping her story, she says that Trump — through Michael Cohen — approached her and negotiated a non-disclosure agreement — $130,000 for her silence. The parties to the agreement were "Essential Consultants LLC", a company formed just before the 2016 election, Mr. Trump (referred to as "David Dennison,") and Ms. Clifford (referred to as "Peggy Peterson."

Is . . . is it normal to have a nondisclosure agreement with aliases and a party that's a new company that you just started?

No. No it is not.

Anyway, Ms. Clifford got a $130,000 payment under the agreement. When the existence of the agreement became public in February 2018, Mr. Cohen began making statements about it and about Ms. Clifford, and sought to enforce the provisions of the agreement (including the gag order on Ms. Clifford and the penalty provision) in a secret arbitration proceeding.

Ms. Clifford, through her current attorney Michael Avenatti, filed a lawsuit in Los Angeles County Superior Court asking the court to hold that the agreement is not enforceable, so that (1) she can talk freely and (2) she won't be penalized for talking. You can read that here. Clifford sued Donald Trump "aka David Dennison" and Essential Consultants, the company Mr. Cohen created.

Then, in what they thought was a shrewd move but was not, Essential Communications removed the case to federal court.

Removed it! Wow. Removal, with the removing and stuff. Exciting. I understand.

. . .

I don't know what that means.

OK. Federal courts, broadly speaking, can hear two types of cases. One type is a case that alleges a violation of a federal statute. The other is a case under what's called "diversity jurisdiction." The idea, historically, is that state courts might not treat someone from another state fairly, so if a case involves disputes from people from different states, you can "remove" it to federal court, and litigate it there. Put simply, if someone sues you in state court, you can remove it — that is, transfer it — to federal court if there is "complete diversity" — if no plaintiff is from the same state as any defendant. Also, the amount at issue has to be high enough.

So here, Essential Communications (supported by Trump) moved the case from California state court to United States District Court for the Central District of California, because Clifford is from Texas, Trump lives in DC, and Essential Communications is a Delaware company. The notice of removal is here.

Was that a good idea?

No it was not. Conventional wisdom is that federal courts are better for the defense and more likely to enforce arbitration agreements. However, federal judges move faster and abide by deadlines and rules more closely, and are substantially less tolerant of bullshit than state judges. If substantial portions of your defense are premised on bullshit and delay, don't remove to federal court.

So. What's the issue in federal court?

Well, the main issue is whether the nondisclosure agreement — and especially the part that requires disputes to be arbitrated in private — are enforceable. If they are enforceable, then Trump (and, I suppose, "Essential Communications") could conceivably get a gag order against Clifford and get massive damages against her for breaching the confidentiality agreement, and could do so through a private arbitration proceeding instead of in public.

But wait a minute. Stormy Daniels already told her story in public. It's been all over the media. All this litigation does is draw more attention to it and, potentially, make Trump or Cohen answer questions about the hush money. How does it make sense for Trump and Cohen to try to enforce the nondisclosure now that the cat's out of the bag?

It's a very foolish move.

Unless, of course, Trump and Cohen are worried that failing to pursue Clifford will signal to others than other nondisclosure agreements will not be enforced.

But really, even then.

Okay. So even Ms. Clifford says that she signed this agreement and got the $130,000, right? So how can she say that she's not bound by the nondisclosure agreement and the arbitration clause?

You can read her arguments in her amended complaint in federal court.

She has three main arguments. First, she says that there was never an enforceable contract. Her argument is this: Trump never signed the contract. Now, normally, that wouldn't be a good argument — Clifford signed it, and she accepted the money, which is enough to enforce it against her. But here the contract has some ill-considered boilerplate language that it's only effective once everyone signs it. Don't put that in your contracts if you're not going to get everyone to sign them.

Second, she says that the contract is unconscionable. Very rarely, a court will refuse to enforce a contract if its terms are too shocking and one-sided. Clifford claims that the million-dollar penalty and other terms, all one-sided, and that there's no penalty if Trump or Cohen breach (by, for instance, Cohen's rant to the media).

Third, she argues that the contract is void because it's against public policy. Courts refuse to enforce certain contracts that contradict strong public policy — as one example, you can't contract to conceal a crime from the police, and can't contract to kill someone. Here, Clifford argues that the contract is against public policy because it's meant to evade federal campaign contribution limits (in the sense that the $130,000 to silence Clifford represents an undisclosed and excessive contribution to Trump's campaign) and because it suppresses speech about a candidate for President.

Clifford argues that because the whole contract is void, the arbitration clause is void.

These are, at least, plausible arguments.

Is that all?

No, in her amended complaint, Clifford threw in a defamation claim against Cohen, on the theory that he justified paying her hush money by saying "Just because something isn't true doesn't mean it can't cause you harm or damage." Clifford claims that's defamatory because it states that she's lying.

I think that's an unusually weak defamation claim — the statement is hyperbole in the context of trash-talking about litigation, and isn't even definite, and therefore isn't a provable statement of fact. Cohen has filed an anti-SLAPP motion against that claim, which I think he might win if the case ever moves forward.

Wait a minute. If there's an agreement saying all disputes are arbitrated, who decides the dispute over whether the agreement is valid?

You spotted the loophole! People trying to enforce arbitration agreements always argue that the arbitrator should decide whether they are enforceable. People trying to break them always argue that a judge should decide first. The law in the area is something of a mess, but it's often the case that the arbitrator decides.

There's a significant exception, and Clifford is trying to take advantage of it. The Federal Arbitration Act generally controls arbitration agreements in federal court. Under that Act, if a party disputes that the arbitration agreement was formed at all (as Clifford does here), the federal court can hold a mini-trial on that issue alone. Essential Communications has asked the federal court to send the whole thing — including the attacks on the validity of the agreement — to arbitration. But Clifford has asked the Court first to hold a mini-trial on whether the contract was ever formed at all, and — crucially — to allow limited discovery into that point through depositions of Cohen and President Trump.

That's where it was when the shit hit the fan.

The search of Michael Cohen's office?

The search of Michael Cohen's office, which was huge.

This immediately created grave dilemma for Michael Cohen. On the one hand, the litigation in California would require him to testify — in arbitration if not in the deposition Clifford requested — and would require him to otherwise commit himself to facts. But based on that search, the FBI is clearly investigating him based on the hush-money agreement with Clifford. It's likely that the government's theory is that Cohen engaged in transactions that broke campaign finance laws by paying the $130,000 to protect Trump's campaign, and perhaps committed other violations arising from that core violation. It would be absolutely reckless for him to start talking about the circumstances; the only good advice is to lawyer up and shut up.

Incredibly — and uniquely, in the course of the Trump people's behavior in the last year — Cohen has done something smart. Well, sort of. He's decided to preserve his option to shut up. He's asked the federal court to stay the case — freeze it without activity — because it implicates his Fifth Amendment rights in the criminal investigation.

He can take the Fifth in a civil case? I thought that was for criminal cases.

You can take the Fifth anywhere. The difference is the consequence. If you take the Fifth in a criminal proceeding in which you are the defendant, it can't be held against you. The prosecutor can't even mention it to the jury. But in a civil case, taking the Fifth — that is, asserting your Fifth Amendment right to remain silent — can have serious negative consequences. If you're the plaintiff in a civil case and take the Fifth, the case can be dismissed. If you're a defendant, there can be all sorts of other bad consequences. The jury can be told to consider that you took the Fifth. The Court can prohibit you from introducing any evidence on the issues on which you took the Fifth, so that you can't effectively contradict the Plaintiff's evidence. You can be left unable to prove essential parts of your defense. It's pretty disastrous and it's very hard to defend a civil case while taking the Fifth.

So, when faced with a criminal investigation, both plaintiffs and defendants often ask the civil court to stay — freeze — the civil case while the criminal investigation or prosecution is going on.

And do courts to that?

Sometimes they do, sometimes they don't. The Court is supposed to use a five-part test to decide whether to stay the case. The factors are (1) the plaintiff's interest in moving forward and the harm to plaintiff if there is a delay, (2) the burden on the defendant if the case moves forward, (3) the convenience of the court, (4) the interests of third parties, and (5) the interests of the public.

How do you think it will go?

I think Clifford has the better argument by far.

Her opposition brief is very strong. She points out that Cohen has already run his mouth extensively about the hush money transaction in the media, so his interest in shutting up can't be that strong. She points out that Cohen himself initiated an arbitration proceeding to try to shut Clifford up. She points out that Cohen filed a declaration in this civil case about the formation of the contract even after the FBI's search warrant, and gave a statement about the matter the day after the search.

Moreover, Clifford points out that Cohen's motion is extremely vague — it amounts to saying "look, the FBI is investigating the same general subject." He doesn't explain what specific subjects of testimony (including, for instance, the source of funds or his communications with Trump) that could incriminate him. Finally, she points out that the case is of national interest and has attracted huge public attention, weighing against a stay.

Cohen's failure to commit that he will take the Fifth doesn't help either. Perhaps because taking the Fifth is so widely perceived as a sign of guilt (which, of course, it is not), Cohen's not ready to say definitely that he will take the Fifth to any questions about the transaction — he's sticking with the wishy-washy argument that his rights are "implicated." That's compounded by the fact that his lawyers, asked about him taking the Fifth, publicly denied that he had decided to do so, and suggested that doing so was premature. In other words, they undercut their own stay request.

Wow. That's . . . wow.

I KNOW, RIGHT? I think you only get one smart move per quarter out of Cohen. Contemplating taking the Fifth was his. Now it's all downhill until July or so.

So where does this leave us?

Judge Otero, who is hearing this, is a very no-nonsense judge who likes things to be orderly. I expect a thorough written opinion from him on the stay promptly — within days, I suspect. The best thing Cohen has going for him is that he's only asking for a 90-day stay. Judge Otero may look at this daily-escalating national legal catastrophe and decide that shutting down the civil case for a few months to see how things work out is not a bad idea. Or he may just say Cohen hasn't carried his burden of showing he need a stay.

What happens then?

It depends on the ruling. If Judge Otero grants the stay, then Cohen will have mitigated the harm from this very foolish litigation for the time being, allowing him to focus on his troubles in New York. If Judge Otero denies the stay, next he'll have to rule on whether Clifford gets to take limited discovery and get a mini-trial to determine whether the contract was ever formed and therefore whether the case should go to arbitration. If Judge Otero allows that, then Cohen will have to decide whether actually to take the Fifth when confronted with questions. Buckle up.

Will you update this post when Judge Otero decides?

If I feel like it.

Thursday, April 12, 2018

Make No Law Podcast Episode Five: Crush

Make No Law Episode Five is up! Listen to it at Legal Talk Network or stream right here:

Some resources from this episode:

United States v. Stevens, the subject of the episode

Miller v. California, the obscenity case discussed in the episode

New York v. Ferber, the child porn case mentioned in the episode

Put Bull Victory, Robert Stevens' site about his case and business.

Tuesday, April 10, 2018

New York Times Op-Ed On Cohen Search

It's here.

Monday, April 9, 2018

The Search of Trump Lawyer Michael Cohen's Office: What We Can Infer Immediately

The Very Big News of the day: FBI Agents raided the law office of Michael Cohen, President Trump's lawyer who was involved in payment of $130,000 to adult performer "Stormy Daniels" for a nondisclosure agreement.

Recently I've been listening to the Podcast "Slow Burn," about Watergate. There's a fascinating theme throughout it: when you're living a historical event, how do you know? How can you tell when a development is a Big Deal?

This is a big deal. It's very early on, but here's some things we can already tell.

1. According to Cohen's own lawyer, the U.S. Attorney's Office for the Southern District of New York (widely regarded within itself as being the most important and prestigious U.S. Attorney's Office in the country) secured the search warrants for the FBI. Assuming this report is correct, that means that a very mainstream U.S. Attorney's Office — not just Special Counsel Robert Mueller's office — thought that there was enough for a search warrant here.

2. Moreover, it's not just that the office thought that there was enough for a search warrant. They thought there was enough for a search warrant of an attorney's office for that attorney's client communications. That's a very fraught and extraordinary move that requires multiple levels of authorization within the Department of Justice. The U.S. Attorney's Manual — at Section 9-13.320 — contains the relevant policies and procedures. The highlights:

The feds are only supposed to raid a law firm if less intrusive measures won't work. As the USAM puts it:

In order to avoid impinging on valid attorney-client relationships, prosecutors are expected to take the least intrusive approach consistent with vigorous and effective law enforcement when evidence is sought from an attorney actively engaged in the practice of law. Consideration should be given to obtaining information from other sources or through the use of a subpoena, unless such efforts could compromise the criminal investigation or prosecution, or could result in the obstruction or destruction of evidence, or would otherwise be ineffective.

Such a search requires high-level approval. The USAM requires such a search warrant to be approved by the U.S. Attorney — the head of the office, a Presidential appointee — and requires "consultation" with the Criminal Division of the U.S. Department of Justice. This is not a couple of rogue AUSAs sneaking in a warrant.

Such a search requires an elaborate review process. The basic rule is that the government may not deliberately seize, or review, attorney-client communications. The USAM — and relevant caselaw — therefore require the feds to set up a review process. That process might involve a judge reviewing the materials to separate out what is privileged (or what might fall within an exception to the privilege), or else set up a "dirty team" that does the review but is insulated from the "clean team" running the investigation. Another option is a "special master," an experienced and qualified third-party attorney to do the review. Sometimes the reviewing team will only be identifying and protecting privileged material. Sometimes the reviewing team will be preparing to seek, or to implement, a court ruling that the documents are not privileged. (Robert Mueller is aggressive on this sort of thing; he already sought and obtained a court ruling that some of Paul Manafort's communications with his lawyers were not privileged because they were undertaken for the purpose of fraud — the so-called "crime-fraud exception" to the attorney-client privilege.

3. A Magistrate Judge signed off on this. Federal magistrate judges (appointed by local district judges, not by the President) review search warrant applications. A Magistrate Judge therefore reviewed this application and found probable cause — that is, probable cause to believe that the subject premises (Cohen's office) contains specified evidence of a specified federal crime. Now, Magistrate Judges sometimes are a little too rubber-stampy for my taste. But here, where the Magistrate Judge knew that this would become one of the most scrutinized search warrant applications ever, and because the nature of the warrant of an attorney's office is unusual, you can expect that the Magistrate Judge felt pretty confident that there was enough there.

4. The search warrant application (the lengthy narrative from the FBI agent setting for the evidence) is almost certainly still under seal, and even Michael Cohen doesn't get to see it [yet]. But the FBI would have left the warrant itself — and that shows (1) the federal criminal statutes they were investigating, and (2) the list of items they wanted to seize. Much can be learned for those. Assuming Michael Cohen doesn't release it, watch for it to be leaked.

Again: this is a Big Deal.

I'll follow up with more as it becomes available.

Wednesday, April 4, 2018

What It Means That Trump Is "Only A Subject"

Yesterday the Washington Post reported that Special Counsel Robert Mueller views the President of the United States as a subject, not a target, of his grand jury investigation:

Special counsel Robert S. Mueller III informed President Trump’s attorneys last month that he is continuing to investigate the president but does not consider him a criminal target at this point, according to three people familiar with the discussions.

In private negotiations in early March about a possible presidential interview, Mueller described Trump as a subject of his investigation into Russia’s interference in the 2016 election. Prosecutors view someone as a subject when that person has engaged in conduct that is under investigation but there is not sufficient evidence to bring charges.

The hot takes, predictably, are raining down. Here's one by John Podhoretz — not to pick on him, because it's not unusually bad or wrong, but by way of example:

Yes, the story goes on to say that he might become a target later. But Mueller has been at this now for nine months with an aggressive staff. He has issued indictments of various figures and might be going after others. So telling Trump that he’s not a target is a very big deal.

Well, no. That's an overconfident overstatement.

The feds, by doctrine and tradition, divide everyone of interest to a federal grand jury investigation into three categories: target, subject, and witness. A witness is someone who has useful information but isn't considered a potential suspect in any wrongdoing. Here's how the U.S. Attorney's Manual defines targets and subjects:

A "target" is a person as to whom the prosecutor or the grand jury has substantial evidence linking him or her to the commission of a crime and who, in the judgment of the prosecutor, is a putative defendant.

. . . .

A "subject" of an investigation is a person whose conduct is within the scope of the grand jury's investigation.

This is rather dry. Colloquially, most federal prosecutors and defense attorneys would probably describe it this way: calling someone a target means "we're planning on indicting you if we can." Calling someone a subject means "we're developing evidence about what you did and if we find support for it we may indict you." The distinction has some legal significance — under the provision linked above, prosecutors aren't allowed to subpoena a target into the grand jury without warning them that they are a target, for instance. But the practical differences are murky.

Different prosecutors have different practices about when they call someone a target. Some will use that label as soon as they think it is likely they will be indicted. Some are more "cautious" and only classify someone as a target when they are quite sure that they'll indict. Some prosecutors — ones who risk a bad reputation — will disingenuously classify someone as a subject in order to lure them and their attorneys into talking to the government, even if talking to the government would be manifestly a bad idea. Other prosecutors are overcautious in the other direction and label people targets so no one can accuse them of hiding the ball.

There's a benefit to knowing you're a target — there's no ambiguity and you can focus on going to the mattresses. It's trickier if you're a subject. Clients — and some lawyers — will clamor to talk to the prosecutors to convince them that they shouldn't be a subject, that they should only be a witness. They see the "subject" designation as an opportunity to talk their way out of it. But for more cautious federal defense attorneys, the "subject" classification doesn't change the strategy very much. The client can still become a target at any time. Talking to the government may well provide the information they need to make that decision. Furthermore, talking to the government often generates its own new crimes, as we've seen again and again in Mueller's investigation as defendants have been charged (and in several cases pleaded guilty) to lying to the government. The situation is still one of intense danger, and no experienced defense attorney is relieved to hear their client is "only a subject."

The analogy I sometimes use with clients is this: if you're a target, you're walking across an open field and a sniper is shooting at you from a tower. If you're a subject, you're walking across an open field and a sniper is shooting, but not shooting at you at this particular moment. How much safer do you feel?

Robert Mueller is rather by-the-book. Even when his goals are aggressive, his methodology is not envelope-pushing — he is meticulous about seeking judicial approval in the form of warrants and court orders. Some have speculated that he's classifying Trump as a subject only because Trump can't be indicted while in office and therefore can't be a target. That logic strikes me as fanciful: no court has held that a sitting President can't be indicted, Mueller has not said or done anything to indicate he holds that constrained view of his powers, and Mueller's more likely to take a conservative read of the U.S. Attorney's manual and warn Trump if he's a target under any theory without applying such concealed logic.

Given Mueller's caution (applying for judicial approval whenever necessary) and standard methodology (developing the case through subpoenas and interviews, catching suspects in lies and using those lies to flip them as cooperators, steadily indicting new defendants as they become vulnerable), the most reasonable explanation is that he means what he says — Trump is a subject. That doesn't mean he's made a determination that Trump won't be indicted, or that it's unlikely he'll be indicted, or that he hasn't committed crimes or wrongdoing. It doesn't reflect a judgment on whether there has been a crime. It means he's not there yet. Calling Trump a subject is completely consistent with continuing to pursue evidence that would move Trump into the target column. It doesn't reduce Trump's exposure at all. It doesn't change the dilemmas his godforsaken criminal defense lawyers face. It doesn't reduce the manifest dangers of him making a statement to Mueller. It doesn't stop the process or the process stories or the steady rolling-up of Trump associates for various crimes and foolishness.

In this post-factual and obstinately legally illiterate world, though, the distinction will be used for propaganda. Don't fall for it.