November 7, 2025 • 39 mins
Timothy Brightbill, a partner and co-chair of the international trade practice at Wiley Rein, discusses the Supreme Court oral arguments over Trump’s sweeping global tariffs. Then former federal prosecutor Robert Mintz, a partner at McCarter & English, discusses former FBI Director James Comey’s defense against charges of lying to Congress. And antitrust expert, Harry First, a professor at NYU Law School, discusses the pre-trial win for Michael Jordan in his antitrust fight against NASCAR. June Grasso hosts.
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Speaker 1 (00:02):
This is Bloomberg Law with June Grossel from Bloomberg Radio.
Speaker 2 (00:08):
Why do you think Presidents Clinton, Bush Obama have not.
Speaker 3 (00:15):
Used i EPA to impose tariffs?
Speaker 4 (00:18):
It's one of the most important cases of the term,
a test of presidential power where President Trump's signature economic
policy is at stake and a decision against him could
mean refunding of more than one hundred billion dollars. And
after nearly three hours of oral arguments on Wednesday, it
(00:39):
appears that Supreme Court justices across the ideological spectrum are
skeptical that Trump has the legal authority to impose billions
of dollars in tariffs. Chief Justice John Roberts and Justice
Sonya Sotomayor said, the tariffs are taxes, and the Constitution
gives taxing power to Congress.
Speaker 5 (01:01):
It's a congressional power, not a presidential power to tax.
And you want to say tariffs are not taxes, but
that's exactly what they are, degenerating money from American citizens revenue.
Speaker 6 (01:14):
The vehicle is in position of taxes on Americans and
that has always been the core power of Congress.
Speaker 4 (01:21):
Trump is arguing that the International Emergency Economic Powers Act,
or AIPA gives him virtually unlimited powers to impose tariffs
by executive order. But as several justices pointed out, the
word tariffs is nowhere to be found in that law.
Here are the Chief Justice and Justice Katanji Brown Jackson, Well, but.
Speaker 6 (01:43):
The exercise of the power is to impose tariffs, right,
and the statute doesn't use the word tariffs.
Speaker 3 (01:50):
Your argument suggests that we should see the word imposed,
the phrase impose tariffs in that same series of things
that the president could do. We don't see that word,
And instead you take regulate and say that must mean that.
Speaker 4 (02:06):
No other president has tried to impose tariffs under AJEPA,
and Justice Neil Gorsuch, a Trump appointdee, expressed alarm at
the idea that Congress could delegate such seemingly unlimited power
to the president.
Speaker 2 (02:22):
Congress, as a practical matter, can't get this power back
once it's handed it over to the President's a one
way ratchet toward the gradual but continual accretion of power
in the executive branch and away from the people's elected representative.
Speaker 4 (02:36):
All three lower courts that ruled on the issue found
the tariffs to be unlawful. My guest is Timothy Bright Bell,
partner and co chair of the International Trade practice at
Wiley Rhin. Tim tell us what's at stake in this case.
Speaker 7 (02:52):
This case involves the centerpiece of President Trump's economic agenda.
Is the biggest trade case the Supreme Court has ever heard,
and it goes straight to the key constitutional issue of
who has the power to impose tariffs, the US Congress
or the president. President Trump says the law that he used,
(03:14):
the International Emergency Economic Powers Act, gives him the power
to regulate imports, and that that includes the power to
impose tariffs, including ventanyl tariffs on China, Canada, and Mexico,
and reciprocal economic tariffs on almost all countries. Whereas the
plaintiffs in this case say that Congress has that power
(03:35):
and cannot delegate that power, and that AEPA, which has
never before been used to impose tariffs, does not include
that power and afford So that is what is at stake.
And of course the tariffs under AEPA have led to
collection of hundreds of billions of dollars of tariffs already,
so it's very high economic stakes for the companies and
(03:57):
industries that it paid those tariffs as well.
Speaker 4 (04:00):
There's always a textual analysis these days, and many of
the justices were concerned that the text of the statute
doesn't mention the word tariffs at all exactly.
Speaker 7 (04:12):
The argument focused quite heavily on this law used by
President Trump AIPA and whether that law, which gives the
president the power to regulate imports, also includes the power
to impose tariffs. That really dominated most of the hearing,
and the justices asked very difficult questions on both sides.
(04:33):
The administration said that the ability to impose tariffs is
a core application of the ability to regulate imports in
a historical context, said that, of course, the power to
regulate imports would be read to include tariffs because tariffs
have been used throughout our country's history. On the other hand,
(04:53):
several justices were skeptical of that, and the plaintiffs in
this case said that when the delegation and includes tariff authority,
there is always specific language to that effect, and that
there are always conditions and tests and agency decisions that
have to go into that tariff power. So there was
(05:14):
a good amount of the argument focused on those issues,
and again, whether power to regulate imports includes the power
to impose tariffs, and.
Speaker 4 (05:21):
What did you think about the Solicitor General's argument that
the Trading with the Enemy Act of nineteen seventeen gives
the president authority to impose these tariffs.
Speaker 7 (05:33):
The Solicitor General argued, yes, that the Trading with the
Enemy Act was used to impose tariffs in a prior
situation by President Nixon, and that there's no reason to
think that anything had changed when AIPA had passed. On
the other hand, the plaintiffs had a response to that
in terms of the fact again that when tariffs are involved,
(05:57):
there are always conditions on their use, there are always
specific procedures, and also the fact that the reality is
that no other president in fifty years has used AIPA
to impose tariffs.
Speaker 4 (06:09):
The Major Questions doctrine came up several times during the arguments.
It basically says that when the executive branch takes an
action with major political or economic significance, Congress has to
have expressly authorized it, and the Chief Justice made it
fairly clear that he thought the Major Questions doctrine applies here.
Speaker 7 (06:34):
Yes, So the question here is, does the Major Questions
doctrine require a clear statement in AIPA that it includes
the power to impose tariffs, and this Court has not
hesitated to start using that doctrine more broadly. But I
think you're right that the justices had some concerns about
(06:56):
pursuing it in this venue. And again, the question comes
to is the power to tariff implied in the power
to regulate imports or if it's not. Was this a
question that Congress was required to state clearly that tariffs
were a part of what was envisioned by the new law.
Speaker 4 (07:17):
The Conservatives us the Major Questions doctrine to block several
of President Biden's initiatives, like his student loan forgiveness program.
If they allow Trump to impose these tariffs, do you
think they'll have to explain why the Major Questions doctrine
applied to Biden but not Trump.
Speaker 7 (07:38):
I think it's an interesting question whether they'll go there
or whether they will just focus on the language of
AIBA and this issue of whether the power to regulate
imports includes the power to tariff, and I think several
justices went down that road. I don't think just because
these doctrines have been used in other cases, such as
the Biden student bond forgiveness case doesn't necessary mean that
(08:00):
they will have to address it in this opinion if
they have other bases for finding that the tariffs were
legal or improper in any way.
Speaker 4 (08:10):
And Justice Gorsuch in particular expressed alarm about the seeming
lack of limitations on the powers the President was claiming here.
Speaker 7 (08:21):
Justice of course the hypothetical of if Congress can delegate
the tariff authority, what would prohibit Congress from delegating everything,
including the power to declare war, which is clearly given
in the Constitution to Congress. And so that was a
very interesting discussion. I'm certainly raising some concerns about the limits,
(08:43):
if any, on the authority that the government was claiming.
Speaker 4 (08:47):
So where do you think the justices are going to
come out here?
Speaker 7 (08:50):
Well, I'm not in the business of making predictions. Generally.
My own personal view is that the Court's three Democratic
justices probably vote against these tariffs. And the question is
whether some of the majority of the Court have similar
concerns about the president's use of this law. And I
do think that it's still a very close decision. It
could go either way. I thought Chief Justice Roberts and
(09:14):
Justice Barrett and Justice Gorsich were perhaps more skeptical of
the president's tariff authority under a than the other justices. Yues.
The only other point I would make is, although it
was discussed in the oral argument, I have a hard
time seeing this court making a split decision that some
of President Trump's tariffs are acceptable but others are not.
Speaker 4 (09:37):
So if the Court does rule against Trump, what happens
next as far as his tariffs are concerned.
Speaker 7 (09:43):
Well, two things would happen. First of all, there would
likely be some sort of a refund process for importers
that paid the tariffs during this time, and there is
some precedent for that before That was discussed during the
oral argument a situation where the court struck down a
harbor maintenance tax and there was basically a process where
companies could file claims for the amount of the tax
(10:05):
that they paid. So Justice Barrettz was concerned that this
could be a mess and could be very unwieldy. I
guess the more important point is what will the president
do going forward? And I think it's clear that tariffs
are still a cornerstone of this administration's economic policy. And
if the Court says that the President cannot use AIPA,
(10:26):
the President will likely pivot to one of several other
trade tools that are available, and the Court mentioned many
of these, including Section one twenty two, the section two
thirty two, the National Security Law, which the administration has
already made quite a bit of use of in this administration,
Section three zero one, and so forth. The limit on
(10:48):
those laws is that they do require studies or actions
by other agencies. So Section two thirty two requires a
study and a report by the Commerce Department and consultation
with the Defense Department in order to decide that imports
of a certain product like semiconductors or pharmaceuticals are a
(11:09):
threat to national security. Similarly, Section three oh one, which
was the law used to impose tariffs on China during
the first Trump administration, also requires a detailed study by
the US Trade Representative with public inputs. So those tools,
for the most part, cannot be used as quickly as
(11:29):
AIPA was used by President Trump.
Speaker 4 (11:32):
This case was fast tracked by the court so a
ruling could come as quickly as the end of the year.
Thanks so much for joining me, tim that's Timothy Bright,
Bill of Willie Rhin Coming up next to the Bloomberg
Law show. Prosecutors get us scolding from the judge in
the case against former FBI director James Comey. I'm June
(11:53):
Grosso and you're listening to Bloomberg.
Speaker 2 (11:55):
My heart is broken for the Department of Justice, but
I have great confidence in the federal judicial system.
Speaker 1 (12:02):
I'm innocent, so let's have a trial.
Speaker 4 (12:06):
But will the criminal case against former FBI director James
Comy even get to trial. Comy is pleaded not guilty
to the charges of lying to Congress in twenty twenty,
and his defense has filed several motions to get the
case dismissed before trial. They include emotion to dismiss because
(12:26):
the government is engaged in a vindictive and selective prosecution,
emotion to dismiss because the interim us attorney was appointed illegally,
and emotion to dismiss because Comy's testimony was literally true.
And on Wednesday, a clearly exasperated judge scolded the prosecutors
(12:48):
for the Justice Department's indict first and investigate second approach
to the case. Magistrate Judge William Fitzpatrick then ordered the
prosecutors to turn over to the defense a raft of
potential evidence, including full transcripts of the grand jury proceedings.
My guest is former federal prosecutor Robert Mintz, a partner
(13:11):
maccarter and English Bob. How unusual is it for a
judge to make these kinds of remarks that the Justice
Department here indicted first, an investigated second, and that the
prosecutors may have mishandled some evidence.
Speaker 8 (13:27):
Well, it's very unusual for the judge to comment on
the prosecutor's conduct and to comment on the evidence of
the case this early in the process. And it suggests
that the court, at least this judge, of the magistrate
judge who was handling this argument, has some serious questions
about the procedures used by prosecutors and whether or not
(13:48):
they had really put together the evidence necessary to pursue
this case. And the warning that he gave prosecutors with
regard to mishandling evidence turns on this whole question of
evidence seized from sirch warrants way back in twenty nineteen
and twenty twenty in an unrelated investigation, And there's going
to be an inquiry now into whether or not the
(14:10):
information that prosecutor seesed many years ago is being properly
utilized in this prosecution.
Speaker 4 (14:17):
And that evidence was seized from Comy's friend and former
attorney Daniel Richmond as part of an internal investigation of
leaks in the Russia case during the first Trump administration.
Let's talk about the judge ordering the full grand jury
transcripts to be handed over. That could be a treasure
(14:37):
trove for the defense, which claims that there were severe
and pervasive irregularities in the presentation to the grand jury
by the newly installed interim US Attorney Lindsey Halligan, who
had no experience as a prosecutor.
Speaker 8 (14:54):
It's not unusual for transcripts of witnesses who might appear
before the grand jury to be turned over.
Speaker 9 (15:01):
To the defense. In fact, it's required.
Speaker 8 (15:03):
Prosecutors generally prefer not to have witnesses who are favorable
to the government testify in the grand jury because then
those statements and that testimony has to be turned over
to the defense, and it provides defense lawyers fodder for
cross examination if the witness testifies at trial in any
way differently or inconsistently with the testimony they gave before
(15:26):
the grand jury.
Speaker 9 (15:27):
But what's going to be interesting here for the.
Speaker 8 (15:29):
Defense team is not so much what was said from
the witness, who in this case was an FBI agent
who is simply summarizing the case, but the questions that
were posed by the prosecutor in this case, the interim
US attorney Lindsay Halligan, how she presented the case to
the grand jurors, how she presented the law to the
grand jurors, how she may have answered any questions that
(15:53):
grand jurors raised. Because what happens during the grand jury
process is that there's a grand jury foreman and the
grand jury formant has a conversation, often when the prosecutor
is outside of the grand jury room, and then the
foreman will ask questions on behalf of all the grand jurors.
That happens fairly frequently, and in this case, we know
that the grand jurors decided not to return an indictment
(16:16):
on one of the three counts, So there's no question
that there was some significant conversation and debate going on
among the grand jurors and probably a number of questions
that were posed to the prosecutor. The defense team is
going to be very interested in seeing how Lindsey Halligan
answered those questions, and they're going to be looking to
(16:36):
see whether there's anything she did that they will argue
was improper in front of that grand jury that could
possibly taint the entire indictment. And if they can ultimately
convince the judge that the irregularities are serious enough so
that it taints the entire grand jury process and that
indictment is thrown out, they may well have won their
case because the station of limitations, I'm sure they will argue,
(16:59):
has now expired.
Speaker 4 (17:01):
Apparently the government is concerned about turning over the grand
jury transcripts because they agreed to turn over the evidence
ceased from Richmond, but they're appealing the magistrate judges ordered
to turn over the grand jury transcripts.
Speaker 8 (17:15):
Well, that's not surprising that they are appealing that, because again,
it's so unusual for defense lawyers to get the actual presentation,
and it's quite possible that there were some statements that
were made that could be problematic for prosecutors. So they
have now appealed the magistrate judge's decision that's requiring them
to turn over the grand jury material to the district
(17:38):
court judge, and they're basically arguing that the magistrate judge
exceeded his authority in ordering the grand jury transcripts to
be turned over. They are arguing that the defense team
had already fought in motion to seek to get access
to the grand jury presentation, and that that was pending
before the District Court judge, and that the magistrate judge
(18:00):
was at that point only appointed to deal with a
question of potential privileged materials, and in requiring that the
grand jury material be turned over, he went beyond the
scope of the authority that was delegated to him by
the District Court Judge.
Speaker 4 (18:16):
Bob in terms of the motion to dismiss the indictment
because Lindsay Halligan was illegally serving when she brought the
charges against Comy. US Attorney General Pam Bondy filed a
court document on Monday saying that she had retroactively given
Halligan the additional title of Special Attorney. I mean, I
(18:39):
too would like to go back in time and correct
some of my mistakes. But will a court allow her
to go back to September and basically say, oh, I
meant to give her this title too.
Speaker 8 (18:50):
I think the argument by the Attorney General that she
can retroactively give Eastern Virginia's top prosecutors an extra title
in order to try to defend against the claims that
Halligan was improperly appointed is probably not going to gain
a lot of traction with the courts.
Speaker 9 (19:07):
Typically, the courts will look.
Speaker 8 (19:09):
At the facts at the time and whether or not
the appointment was proper under the rules, under the regulations,
under the statues.
Speaker 9 (19:16):
At the time of the appointment.
Speaker 8 (19:18):
And I think it's an uphill battle to argue that
even if there was a deficiency, then that can be
remedied retroactively by an appointment.
Speaker 4 (19:26):
In one of the motions to dismiss, the defense claims
the indictment is hopelessly vague and defective on its face,
that Senator ted Cruz's questions to Comy were fundamentally ambiguous
and that Comy's response was literally true. Let's listen to
the exchange between Cruz and Komy.
Speaker 2 (19:46):
What mister McKay is saying and what you testify to
this committee cannot both be true. One or the other
is false. Who's telling the truth?
Speaker 1 (19:56):
I just can only speak to my testimony.
Speaker 10 (19:58):
I stand by what the test money you summarized that
I gave in May of twenty seventeen.
Speaker 4 (20:03):
So the defense wants the prosecution to tell them which
of Komy's statements are you claiming were false?
Speaker 8 (20:11):
Yeah, And that's exactly why false statement prosecutions are extremely difficult,
because you have to parse through exactly what was the
question and what was the answer and demonstrate that at
the time the answer was given, it was not only false,
but it was intentionally false, and that it was false
about something that was material. So in this case, the
(20:33):
prosecution is based on hearing before the Senate Judiciary Committee
on September thirtieth, twenty twenty, and at that hearing, Senator
Ted Cruz asked mister Comy whether he had authorized someone
at the FBI to be an anonymous.
Speaker 9 (20:46):
Source in news reports.
Speaker 8 (20:48):
The indictment says that mister Comy misled the committee by
saying that he had not done so. Now, Comy's lawyers
have attacked that indictment by saying that the questioning by
mister Cruz was vague and imprecise, and point out that
at the time that Senator Cruz was questioning mister Comy
about whether he had authorized anybody to leak information, that
Senator Cruz was referring to Andrew McCabe, who once served
(21:11):
as mister Comy's deputy at the FBI, and was not
referring to Daniel Richman, who had been a former FBI
employee and later became the attorney for James Comy. So
they're arguing that the indictment is defective on its face,
because in order to prove that mister Comy lied, you
have to show that there was a clear question and
that he gave a clearly false, a knowingly false answer
(21:34):
to it, and that he had an intention to mislead
the committee, and that the information he provided that was
false was material, and that this somehow obstructed the relevant
congressional proceeding. They say that that information is not contained
in the indictment, and one of their emotions is the
requirement that the government provide that information.
Speaker 9 (21:53):
So what you have here basically.
Speaker 8 (21:55):
Is an argument that the indictment is defective on its face. So,
in other words, it's not had an argument that the
government has its facts throng, because a factual dispute is
something that has to.
Speaker 9 (22:05):
Be resolved by a jury at trial.
Speaker 8 (22:07):
They are arguing that this is a decision that really
needs to be made by the judge because on its face,
the government is unable to prove the charges. The allegations
in the indictment simply are not enough to sustain a
valid conviction, and that's why they're filing this whole slew
of arguments to try to get this case dismissed before
(22:28):
it ever goes to trial.
Speaker 4 (22:29):
And prosecutors would not be able to bring the charges
again because the statute of limitations has run out, and
supposedly that's why the indictment was rushed through. Comy's indictment
came just five days after President Trump had demanded on
truth Social that Attorney General Pam Bondi bring charges against Komy,
(22:53):
New York Attorney General Letitia James, and Senator Adam Schiff.
So legal experts were talking about as selective and vindictive
prosecution motion even before the defense made that motion in
the case. Comy's motion papers include a sixty page long
list of links that detail Trump's negative comments about him
(23:16):
over the years. How strong is their vindictive prosecution motion?
I know it's very hard to get a case dismissed
on those grounds, That's exactly right.
Speaker 8 (23:27):
I mean, motions for vindictive prosecution.
Speaker 9 (23:29):
Are exceedingly hard to win.
Speaker 8 (23:31):
They require defendants to prove the prosecutors have displayed animus
towards them while they were seeking to exercise their rights,
and that the charges never would have been brought except
for that animus. Now, prosecutors have argued in response that
the comments made by President Trump to prosecute mister Komy
were only suggesting that if mister Komy committed a crime,
(23:54):
that they ought to prosecute him, and that he was
not directing the Department of Justice to prosecute mister Komey
regardless of whether or not a crime was committed. We'll
have to see how the judge handles that at the
end of the day. But the vindictive prosecution standard is
fairly high and that may be a difficult argument for
the defense to prevail on.
Speaker 4 (24:12):
We'll see how it goes at the hearings next week.
Thanks for a great conversation, Bob. That's former federal prosecutor
Robert Mintz of McCarter and English. Coming up next on
the Bloomberg Law Show, Michael Jordan's racing team scores a
key victory in court in its antitrust lawsuit against NASCAR.
(24:33):
I'm June Grosso and you're listening to Bloomberg.
Speaker 10 (24:36):
Look I've been a fan of the game for a
long period of time, you know, and you know, when
we first started this coal process, I've always said that
y'all want to fight for the betterment of the sport.
Speaker 4 (24:46):
You know.
Speaker 10 (24:46):
Even though they try to point out that, you know,
we made you know, some money, or we had successful business,
that's not the point. The point is is that the
sport itself needs to continually change for the better for
the fans as well as for the teams as well
as from NASCAR tooth.
Speaker 4 (25:00):
They understand that Michael Jordan's racing team scored a huge
win off the track in its anti trust case against NASCAR.
Jordan's twenty three to eleven racing team and front Row
Motorsports claimed that NASCAR acts like an illegal monopoly in
a dispute that centers on new charter agreements which both
(25:22):
teams refuse to sign, and on Tuesday, a federal judge
agreed that NASCAR controls the market for premier stock car
racing and granted partial summary judgment to the two racing teams.
The decision turns up the pressure to settle ahead of
the December one trial date. Although Jordans says he's ready
(25:43):
for trial.
Speaker 10 (25:44):
I look forward to going down on the fire. If
I have to fight this to the end for the beliment.
Speaker 1 (25:49):
Of the sport, I will do that.
Speaker 4 (25:51):
Joining me is anti trust law expert Harry First, a
professor at NYU Law School. Harry explained Michael Jordan's anti
trust case against NASCAR.
Speaker 6 (26:01):
This is a tussle between the family that has controlled
NASCAR and I guess stock car racing for many years,
almost uniquely in sports.
Speaker 1 (26:11):
You know, most sports.
Speaker 6 (26:13):
Are controlled by groups of team owners, but this is
one that's only controlled by one family, this France family.
You know, I guess It's had its ups and downs,
but it's pretty up now.
Speaker 1 (26:25):
You know.
Speaker 6 (26:25):
They're sort of the only real game in town for
the top Line Cup racing. There basically been arguments between
the owners of these racing teams and the Frances over
who's going to sort of split the money, particularly broadcast revenue.
I think they both need each other. Race car owners
(26:48):
need tracks to race on, and NASCAR, you know, has
made itself through a series of moves, acquisitions and so forth,
is basically the only place where you can have these
high level races. And of course you've got to have
the race cars racing or else you've got nothing to show.
So they both need each other. But apparently the racing
(27:09):
teams have not been hugely profitable unlike other sports. It's
very expensive to maintain these, according to the litigation anyway,
and the Frances, So the plaintiffs say, the plaintiff's being
two of these teams, and one being this twenty three
to eleven racing, which is Michael Jordan's. The plaintiffs say
that the Frances take most of the revenue, particularly the
(27:33):
broadcast revenue, and we're not getting enough, you know. The
Francis say, well, you don't like it, take it or
leave it, and that's when the litigation particularly broke out.
Speaker 4 (27:43):
It sounds like anti trust to me, but sounds like yeah,
sounds like it.
Speaker 7 (27:48):
Is it?
Speaker 4 (27:48):
So this partial summary judgment was about the relevant market,
which we've talked about before is key to anti trust.
Speaker 6 (27:57):
So the litigations had a little back and forth. The
district court judge seems pretty well disposed of the plaintiff's claims,
at one point issuing this injunction requiring NASCAR to admit
the two teams into the I guess it was a
twenty twenty four Circuit and the Court of Appeals knocked
(28:17):
that down for various reasons.
Speaker 1 (28:19):
So the district.
Speaker 6 (28:21):
Court judge granted the plaintiff's motion for partial summary judgement.
I mean, some of the important issues are now out
of the case, and particularly, as you mentioned, this contentious
issue over what's the relevant market. Is it just this
NASCAR premiere racing market? Does it include you know, other
(28:41):
kinds of stock car racing? There are other tiers? Does
it include other motor sports? The game and anty trust
if you're a defendant, is to constantly include different kinds
of substitutes.
Speaker 1 (28:53):
Of what people would watch. But here the market is
a labor.
Speaker 6 (28:57):
Market that they're arguing about, and the question is, you know,
what are the choices available for these race car drivers
who are selling their services? And this is basically it.
So it looked like a pretty strong claim on market definition.
But proving market definition is expensive, you know, requires lots
(29:17):
of experts, and this is before you get to the jury,
this summary judgment stage. But a lot of the record's
been developed, and the district court judge sort of took
an interesting turn on this. He said, well, if there's
a dispute of fact, which there always is, in market definition.
I think it's really broad. You know, while you could
(29:39):
have lots of race car drivers, there are lots of
choices that the race car drivers have. I think it's
really narrow, say the plaintiffs. So lots of things to
argue in front of a jury. But the judge says, ah,
guess what, NASCAR you filed a counterclaim against these driver
teams which had gotten together to jointly negotiate with NASCAR
(30:03):
over these agreements that they're charges. So we're alleging that
you sort of engage in a price fixing conspiracy. So
they filed a counterclaim. Now, unfortunately for them, when you
file a complaint in anty trust, normally you have to
put in your complaint what the relevant market is. So
(30:23):
they defined a market which was pretty much the same
as the market that Michael Jordan defined, but basically the
same labor market. It's these racing teams, you know, the
premier stock car racing group, you know, at the very top.
Speaker 1 (30:39):
So they basically define the same market.
Speaker 6 (30:41):
So the judge says, sorry, you've already admitted it, and
you know, we hold that you've made this admission. That's
your admission, So we're done, and you're done and we
don't have to try this issue. I'm sure that defendants
and their lawyers were not all that happy with that,
and I mean, I think it's pretty supportable on appeal,
(31:02):
and there would have been ways to handle the complaint
that didn't fall into this trap. But they were sort
of too clever by half. It was a very clever counterclaim,
but there was no requirement that they even needed to file.
Speaker 4 (31:16):
It is this sort of the ballgame.
Speaker 1 (31:17):
Then well it's not quite the ballgame.
Speaker 6 (31:20):
So the judge also did something else, not just the
market definition, but you have to.
Speaker 1 (31:24):
Have monopoly power or in this case monops.
Speaker 6 (31:27):
A EE power as the sole buyer, and there have
to be high barriers to entry, hard to get into
this market. And the judge found on all of those things.
You know, they've had this position for years and years
as the sole buyer. It's very hard to have a
competing leg. It's hard to even start your own racing team.
(31:48):
They had estimates on that in the record. So the
judge said, no, you've got this high entry barrier. It's
very hard to enter. There are really no substitutes. There
aren't other teams out there, you know, to race. So
on the having monopoly or monopsony power interrelevant market is
now out of the case, but that still leaves the
(32:10):
question really two questions. One is they have to engage
in some anti competitive conduct that maintains their monopoly position,
and that's still going to go to trial, and that involves,
you know, maybe their acquisitions of these other tracks, which
they did. There were some exclusive agreements. There's this agreement
(32:32):
that if you sign an agreement, you wave your.
Speaker 1 (32:34):
Anti trust claims. All of those will go together into
a trial.
Speaker 6 (32:39):
And then there's the question of damages and that's going
to be interesting because you know, the plaintiffs want more money.
Speaker 1 (32:47):
As a plaintiffs always won isay, you took too much,
I didn't get enough. But they have to.
Speaker 6 (32:52):
Show what the competitive rate would be for these teams,
and you know that's going to be a battle of
they're economists. So there's still a distance to go. Maybe
we'll never get there, and the parties are now going
to settle. I don't know, but this I think was
a pretty big win for the plaintiffs.
Speaker 4 (33:11):
They've had mediation sessions and private negotiations which obviously haven't worked.
But after the last court hearing, Michael Jordan said, settlement
has always been on the table, and the pressure is
on when the trial date is coming up soon.
Speaker 6 (33:26):
And it seems to me what they're really arguing over
is how do we split the pot so that the
teams have enough money to invest in these fast cars
and you know, all the things we need to do,
and you know, at the end of the day, perhaps
unfortunately for consumers, there's not going to be another circuit
because these are private.
Speaker 1 (33:47):
Plaintiffs pursuing this.
Speaker 6 (33:48):
So the goal is not to split up nascars so
there are competing circuits and you'd have real competition in
this kind of racing. This is not Michael Jordan's goal.
That's not the goal of private parties. The goal is
to basically split the monopoly profits differently so they will
likely benefit you know, consumers. I don't know, maybe not
(34:12):
so much.
Speaker 4 (34:12):
If I'm the defendant. I don't want to be in
a courtroom sitting opposite Michael Jordan with his star power.
I mean, you know how juries are mesmerized right by stars.
Speaker 6 (34:24):
Asking for damages in a jury trial is a good move,
particularly these days. I mean, juries have come in with
some pretty big verdicts in these big cases against major defendants.
Speaker 1 (34:35):
You know, Google is one example. So, yeah, defendants have
never liked Church. Let's put it that way.
Speaker 4 (34:42):
Yes, defendants do always seem to prefer a bench trial.
Before I let you go, Harry, I just want to
get your take on the bidding war between Pfizer and
Novo Nordisk over the obesity drugs startup met Sarah, which
has some antitrust implications. Pfizer had initially agreed to buy
(35:02):
met Sarah for four point nine billion dollars in September
and then let the bidding begin. The reports now are
that Pfizer has matched Novo's ten billion dollar bid.
Speaker 6 (35:13):
This is an old fashioned bidding war. I keep saying
to people, this is obviously a really fat market for profits.
So the global market for weight loss drugs is now
figured out about seventy two billion dollars and in another
five years projected to be about one hundred and forty billion.
I mean, this is huge money. This is sort of
(35:35):
a fun fight, I guess, particularly if you're a shareholder
of Metzarah. What I love is the revenues of met
Sarah for this year have been zero. They don't have
a product their weight loss drug is now entering Phase
three clinical trials, which many but not all drugs get
(35:56):
through successfully. So everyone's betting that this will go through
through successfully. But it's not out yet and it hasn't
been approved yet by the Food and Drug Administration. But
Pfizer doesn't have a weight loss drug, and Novo Nordisk
is having a lot of financial problems even though they
probably have about fifty percent of the market, with those
(36:17):
Zembic and Wagovi literally having the rest. You know, this
is a market. It's not one hundred percent monopolized like NASCAR,
but maybe larger implications for health and money than nascars.
And the tactics that are being used are really quite
interesting because Phizer is not only arguing that Novo Nordists,
(36:40):
at least at a time higher bid, couldn't and shouldn't
be accepted and so in violation of their agreement that
they had, they've also filed the preemptive any trust case
against Novo Nordisk and Metsera alleging that their agreement, this
merger agreement is illegal.
Speaker 1 (36:59):
They've not only.
Speaker 6 (37:00):
Tried to stop it in Delaware Chancery Court, which has
normal jurisdiction over corporate matters, but they've also filed in
federal court in Delaware a separate any trust case. I'm
alleging some very unusual things about this deal and alleging
that the deal itself is illegal under the Sherman Act
(37:21):
monopolization any competitive and under the Clayton Act, and the
Federal Trade Commission has gotten involved a little bit as well.
Speaker 1 (37:29):
The FTC.
Speaker 6 (37:30):
You know, there's this shutdown that they haven't been able
to do anything. Lo and behold, they awaken from their
slumber and for the first time in almost a month,
they granted early termination. You know, when you have a
merger you have to file, you wait for thirty days
at least to give the government forcers time to at
(37:51):
least see if they want to get more information. They
gave Fizer's bid early termination after fifteen days in the
middle of this shutdown, saying, hey, no prob even though
apparently Pfizer has some weight loss drugs in its own pipeline.
Speaker 1 (38:07):
Not clear exactly so, but they said, hey, no problem
with that.
Speaker 6 (38:11):
And then they issued a letter to the lawyers for
Lenovo Nordisk.
Speaker 1 (38:17):
And met Sarah.
Speaker 6 (38:19):
We've read about this deal which has not been filed
with the federal takers. We read about it, and we're
a little concerned that it may violate the Hartscott Rodino Act,
which involves notification to the government that you're planning around
with this, and so you better watch this.
Speaker 1 (38:38):
So what exactly is.
Speaker 6 (38:40):
Going on, I don't know, but they seem to be
putting a little thumb on the scales in favor of Pfizer,
whether intentionally or not. But they've really injected, sorry, they've
injected themselves into this. It's an old fashioned antitrust tactical bruhaha.
You know how it's going to end up, I'm not sure,
(39:02):
but it's really something to be watching. This is one
with real implications for competition.
Speaker 1 (39:08):
And for health.
Speaker 4 (39:09):
Who knew that weight laws drugs would also involve antitrust?
Thanks so much, Harry. As always, that's Professor Harry First
of NYU Law School. And that's it for this edition
of The Bloomberg Law Show. Remember you can always get
the latest legal news on our Bloomberg Law Podcast. You
can find them on Apple Podcasts, Spotify, and at www
(39:30):
dot Bloomberg dot com, slash podcast Slash Law, and remember
to tune into the Bloomberg Law show every weeknight at
ten pm Wall Street Time. I'm June Grosso and you're
listening to Bloomberg
This is Bloomberg Law with June Grossel from Bloomberg Radio.
Speaker 2 (00:08):
Why do you think Presidents Clinton, Bush Obama have not.
Speaker 3 (00:15):
Used i EPA to impose tariffs?
Speaker 4 (00:18):
It's one of the most important cases of the term,
a test of presidential power where President Trump's signature economic
policy is at stake and a decision against him could
mean refunding of more than one hundred billion dollars. And
after nearly three hours of oral arguments on Wednesday, it
(00:39):
appears that Supreme Court justices across the ideological spectrum are
skeptical that Trump has the legal authority to impose billions
of dollars in tariffs. Chief Justice John Roberts and Justice
Sonya Sotomayor said, the tariffs are taxes, and the Constitution
gives taxing power to Congress.
Speaker 5 (01:01):
It's a congressional power, not a presidential power to tax.
And you want to say tariffs are not taxes, but
that's exactly what they are, degenerating money from American citizens revenue.
Speaker 6 (01:14):
The vehicle is in position of taxes on Americans and
that has always been the core power of Congress.
Speaker 4 (01:21):
Trump is arguing that the International Emergency Economic Powers Act,
or AIPA gives him virtually unlimited powers to impose tariffs
by executive order. But as several justices pointed out, the
word tariffs is nowhere to be found in that law.
Here are the Chief Justice and Justice Katanji Brown Jackson, Well, but.
Speaker 6 (01:43):
The exercise of the power is to impose tariffs, right,
and the statute doesn't use the word tariffs.
Speaker 3 (01:50):
Your argument suggests that we should see the word imposed,
the phrase impose tariffs in that same series of things
that the president could do. We don't see that word,
And instead you take regulate and say that must mean that.
Speaker 4 (02:06):
No other president has tried to impose tariffs under AJEPA,
and Justice Neil Gorsuch, a Trump appointdee, expressed alarm at
the idea that Congress could delegate such seemingly unlimited power
to the president.
Speaker 2 (02:22):
Congress, as a practical matter, can't get this power back
once it's handed it over to the President's a one
way ratchet toward the gradual but continual accretion of power
in the executive branch and away from the people's elected representative.
Speaker 4 (02:36):
All three lower courts that ruled on the issue found
the tariffs to be unlawful. My guest is Timothy Bright Bell,
partner and co chair of the International Trade practice at
Wiley Rhin. Tim tell us what's at stake in this case.
Speaker 7 (02:52):
This case involves the centerpiece of President Trump's economic agenda.
Is the biggest trade case the Supreme Court has ever heard,
and it goes straight to the key constitutional issue of
who has the power to impose tariffs, the US Congress
or the president. President Trump says the law that he used,
(03:14):
the International Emergency Economic Powers Act, gives him the power
to regulate imports, and that that includes the power to
impose tariffs, including ventanyl tariffs on China, Canada, and Mexico,
and reciprocal economic tariffs on almost all countries. Whereas the
plaintiffs in this case say that Congress has that power
(03:35):
and cannot delegate that power, and that AEPA, which has
never before been used to impose tariffs, does not include
that power and afford So that is what is at stake.
And of course the tariffs under AEPA have led to
collection of hundreds of billions of dollars of tariffs already,
so it's very high economic stakes for the companies and
(03:57):
industries that it paid those tariffs as well.
Speaker 4 (04:00):
There's always a textual analysis these days, and many of
the justices were concerned that the text of the statute
doesn't mention the word tariffs at all exactly.
Speaker 7 (04:12):
The argument focused quite heavily on this law used by
President Trump AIPA and whether that law, which gives the
president the power to regulate imports, also includes the power
to impose tariffs. That really dominated most of the hearing,
and the justices asked very difficult questions on both sides.
(04:33):
The administration said that the ability to impose tariffs is
a core application of the ability to regulate imports in
a historical context, said that, of course, the power to
regulate imports would be read to include tariffs because tariffs
have been used throughout our country's history. On the other hand,
(04:53):
several justices were skeptical of that, and the plaintiffs in
this case said that when the delegation and includes tariff authority,
there is always specific language to that effect, and that
there are always conditions and tests and agency decisions that
have to go into that tariff power. So there was
(05:14):
a good amount of the argument focused on those issues,
and again, whether power to regulate imports includes the power
to impose tariffs, and.
Speaker 4 (05:21):
What did you think about the Solicitor General's argument that
the Trading with the Enemy Act of nineteen seventeen gives
the president authority to impose these tariffs.
Speaker 7 (05:33):
The Solicitor General argued, yes, that the Trading with the
Enemy Act was used to impose tariffs in a prior
situation by President Nixon, and that there's no reason to
think that anything had changed when AIPA had passed. On
the other hand, the plaintiffs had a response to that
in terms of the fact again that when tariffs are involved,
(05:57):
there are always conditions on their use, there are always
specific procedures, and also the fact that the reality is
that no other president in fifty years has used AIPA
to impose tariffs.
Speaker 4 (06:09):
The Major Questions doctrine came up several times during the arguments.
It basically says that when the executive branch takes an
action with major political or economic significance, Congress has to
have expressly authorized it, and the Chief Justice made it
fairly clear that he thought the Major Questions doctrine applies here.
Speaker 7 (06:34):
Yes, So the question here is, does the Major Questions
doctrine require a clear statement in AIPA that it includes
the power to impose tariffs, and this Court has not
hesitated to start using that doctrine more broadly. But I
think you're right that the justices had some concerns about
(06:56):
pursuing it in this venue. And again, the question comes
to is the power to tariff implied in the power
to regulate imports or if it's not. Was this a
question that Congress was required to state clearly that tariffs
were a part of what was envisioned by the new law.
Speaker 4 (07:17):
The Conservatives us the Major Questions doctrine to block several
of President Biden's initiatives, like his student loan forgiveness program.
If they allow Trump to impose these tariffs, do you
think they'll have to explain why the Major Questions doctrine
applied to Biden but not Trump.
Speaker 7 (07:38):
I think it's an interesting question whether they'll go there
or whether they will just focus on the language of
AIBA and this issue of whether the power to regulate
imports includes the power to tariff, and I think several
justices went down that road. I don't think just because
these doctrines have been used in other cases, such as
the Biden student bond forgiveness case doesn't necessary mean that
(08:00):
they will have to address it in this opinion if
they have other bases for finding that the tariffs were
legal or improper in any way.
Speaker 4 (08:10):
And Justice Gorsuch in particular expressed alarm about the seeming
lack of limitations on the powers the President was claiming here.
Speaker 7 (08:21):
Justice of course the hypothetical of if Congress can delegate
the tariff authority, what would prohibit Congress from delegating everything,
including the power to declare war, which is clearly given
in the Constitution to Congress. And so that was a
very interesting discussion. I'm certainly raising some concerns about the limits,
(08:43):
if any, on the authority that the government was claiming.
Speaker 4 (08:47):
So where do you think the justices are going to
come out here?
Speaker 7 (08:50):
Well, I'm not in the business of making predictions. Generally.
My own personal view is that the Court's three Democratic
justices probably vote against these tariffs. And the question is
whether some of the majority of the Court have similar
concerns about the president's use of this law. And I
do think that it's still a very close decision. It
could go either way. I thought Chief Justice Roberts and
(09:14):
Justice Barrett and Justice Gorsich were perhaps more skeptical of
the president's tariff authority under a than the other justices. Yues.
The only other point I would make is, although it
was discussed in the oral argument, I have a hard
time seeing this court making a split decision that some
of President Trump's tariffs are acceptable but others are not.
Speaker 4 (09:37):
So if the Court does rule against Trump, what happens
next as far as his tariffs are concerned.
Speaker 7 (09:43):
Well, two things would happen. First of all, there would
likely be some sort of a refund process for importers
that paid the tariffs during this time, and there is
some precedent for that before That was discussed during the
oral argument a situation where the court struck down a
harbor maintenance tax and there was basically a process where
companies could file claims for the amount of the tax
(10:05):
that they paid. So Justice Barrettz was concerned that this
could be a mess and could be very unwieldy. I
guess the more important point is what will the president
do going forward? And I think it's clear that tariffs
are still a cornerstone of this administration's economic policy. And
if the Court says that the President cannot use AIPA,
(10:26):
the President will likely pivot to one of several other
trade tools that are available, and the Court mentioned many
of these, including Section one twenty two, the section two
thirty two, the National Security Law, which the administration has
already made quite a bit of use of in this administration,
Section three zero one, and so forth. The limit on
(10:48):
those laws is that they do require studies or actions
by other agencies. So Section two thirty two requires a
study and a report by the Commerce Department and consultation
with the Defense Department in order to decide that imports
of a certain product like semiconductors or pharmaceuticals are a
(11:09):
threat to national security. Similarly, Section three oh one, which
was the law used to impose tariffs on China during
the first Trump administration, also requires a detailed study by
the US Trade Representative with public inputs. So those tools,
for the most part, cannot be used as quickly as
(11:29):
AIPA was used by President Trump.
Speaker 4 (11:32):
This case was fast tracked by the court so a
ruling could come as quickly as the end of the year.
Thanks so much for joining me, tim that's Timothy Bright,
Bill of Willie Rhin Coming up next to the Bloomberg
Law show. Prosecutors get us scolding from the judge in
the case against former FBI director James Comey. I'm June
(11:53):
Grosso and you're listening to Bloomberg.
Speaker 2 (11:55):
My heart is broken for the Department of Justice, but
I have great confidence in the federal judicial system.
Speaker 1 (12:02):
I'm innocent, so let's have a trial.
Speaker 4 (12:06):
But will the criminal case against former FBI director James
Comy even get to trial. Comy is pleaded not guilty
to the charges of lying to Congress in twenty twenty,
and his defense has filed several motions to get the
case dismissed before trial. They include emotion to dismiss because
(12:26):
the government is engaged in a vindictive and selective prosecution,
emotion to dismiss because the interim us attorney was appointed illegally,
and emotion to dismiss because Comy's testimony was literally true.
And on Wednesday, a clearly exasperated judge scolded the prosecutors
(12:48):
for the Justice Department's indict first and investigate second approach
to the case. Magistrate Judge William Fitzpatrick then ordered the
prosecutors to turn over to the defense a raft of
potential evidence, including full transcripts of the grand jury proceedings.
My guest is former federal prosecutor Robert Mintz, a partner
(13:11):
maccarter and English Bob. How unusual is it for a
judge to make these kinds of remarks that the Justice
Department here indicted first, an investigated second, and that the
prosecutors may have mishandled some evidence.
Speaker 8 (13:27):
Well, it's very unusual for the judge to comment on
the prosecutor's conduct and to comment on the evidence of
the case this early in the process. And it suggests
that the court, at least this judge, of the magistrate
judge who was handling this argument, has some serious questions
about the procedures used by prosecutors and whether or not
(13:48):
they had really put together the evidence necessary to pursue
this case. And the warning that he gave prosecutors with
regard to mishandling evidence turns on this whole question of
evidence seized from sirch warrants way back in twenty nineteen
and twenty twenty in an unrelated investigation, And there's going
to be an inquiry now into whether or not the
(14:10):
information that prosecutor seesed many years ago is being properly
utilized in this prosecution.
Speaker 4 (14:17):
And that evidence was seized from Comy's friend and former
attorney Daniel Richmond as part of an internal investigation of
leaks in the Russia case during the first Trump administration.
Let's talk about the judge ordering the full grand jury
transcripts to be handed over. That could be a treasure
(14:37):
trove for the defense, which claims that there were severe
and pervasive irregularities in the presentation to the grand jury
by the newly installed interim US Attorney Lindsey Halligan, who
had no experience as a prosecutor.
Speaker 8 (14:54):
It's not unusual for transcripts of witnesses who might appear
before the grand jury to be turned over.
Speaker 9 (15:01):
To the defense. In fact, it's required.
Speaker 8 (15:03):
Prosecutors generally prefer not to have witnesses who are favorable
to the government testify in the grand jury because then
those statements and that testimony has to be turned over
to the defense, and it provides defense lawyers fodder for
cross examination if the witness testifies at trial in any
way differently or inconsistently with the testimony they gave before
(15:26):
the grand jury.
Speaker 9 (15:27):
But what's going to be interesting here for the.
Speaker 8 (15:29):
Defense team is not so much what was said from
the witness, who in this case was an FBI agent
who is simply summarizing the case, but the questions that
were posed by the prosecutor in this case, the interim
US attorney Lindsay Halligan, how she presented the case to
the grand jurors, how she presented the law to the
grand jurors, how she may have answered any questions that
(15:53):
grand jurors raised. Because what happens during the grand jury
process is that there's a grand jury foreman and the
grand jury formant has a conversation, often when the prosecutor
is outside of the grand jury room, and then the
foreman will ask questions on behalf of all the grand jurors.
That happens fairly frequently, and in this case, we know
that the grand jurors decided not to return an indictment
(16:16):
on one of the three counts, So there's no question
that there was some significant conversation and debate going on
among the grand jurors and probably a number of questions
that were posed to the prosecutor. The defense team is
going to be very interested in seeing how Lindsey Halligan
answered those questions, and they're going to be looking to
(16:36):
see whether there's anything she did that they will argue
was improper in front of that grand jury that could
possibly taint the entire indictment. And if they can ultimately
convince the judge that the irregularities are serious enough so
that it taints the entire grand jury process and that
indictment is thrown out, they may well have won their
case because the station of limitations, I'm sure they will argue,
(16:59):
has now expired.
Speaker 4 (17:01):
Apparently the government is concerned about turning over the grand
jury transcripts because they agreed to turn over the evidence
ceased from Richmond, but they're appealing the magistrate judges ordered
to turn over the grand jury transcripts.
Speaker 8 (17:15):
Well, that's not surprising that they are appealing that, because again,
it's so unusual for defense lawyers to get the actual presentation,
and it's quite possible that there were some statements that
were made that could be problematic for prosecutors. So they
have now appealed the magistrate judge's decision that's requiring them
to turn over the grand jury material to the district
(17:38):
court judge, and they're basically arguing that the magistrate judge
exceeded his authority in ordering the grand jury transcripts to
be turned over. They are arguing that the defense team
had already fought in motion to seek to get access
to the grand jury presentation, and that that was pending
before the District Court judge, and that the magistrate judge
(18:00):
was at that point only appointed to deal with a
question of potential privileged materials, and in requiring that the
grand jury material be turned over, he went beyond the
scope of the authority that was delegated to him by
the District Court Judge.
Speaker 4 (18:16):
Bob in terms of the motion to dismiss the indictment
because Lindsay Halligan was illegally serving when she brought the
charges against Comy. US Attorney General Pam Bondy filed a
court document on Monday saying that she had retroactively given
Halligan the additional title of Special Attorney. I mean, I
(18:39):
too would like to go back in time and correct
some of my mistakes. But will a court allow her
to go back to September and basically say, oh, I
meant to give her this title too.
Speaker 8 (18:50):
I think the argument by the Attorney General that she
can retroactively give Eastern Virginia's top prosecutors an extra title
in order to try to defend against the claims that
Halligan was improperly appointed is probably not going to gain
a lot of traction with the courts.
Speaker 9 (19:07):
Typically, the courts will look.
Speaker 8 (19:09):
At the facts at the time and whether or not
the appointment was proper under the rules, under the regulations,
under the statues.
Speaker 9 (19:16):
At the time of the appointment.
Speaker 8 (19:18):
And I think it's an uphill battle to argue that
even if there was a deficiency, then that can be
remedied retroactively by an appointment.
Speaker 4 (19:26):
In one of the motions to dismiss, the defense claims
the indictment is hopelessly vague and defective on its face,
that Senator ted Cruz's questions to Comy were fundamentally ambiguous
and that Comy's response was literally true. Let's listen to
the exchange between Cruz and Komy.
Speaker 2 (19:46):
What mister McKay is saying and what you testify to
this committee cannot both be true. One or the other
is false. Who's telling the truth?
Speaker 1 (19:56):
I just can only speak to my testimony.
Speaker 10 (19:58):
I stand by what the test money you summarized that
I gave in May of twenty seventeen.
Speaker 4 (20:03):
So the defense wants the prosecution to tell them which
of Komy's statements are you claiming were false?
Speaker 8 (20:11):
Yeah, And that's exactly why false statement prosecutions are extremely difficult,
because you have to parse through exactly what was the
question and what was the answer and demonstrate that at
the time the answer was given, it was not only false,
but it was intentionally false, and that it was false
about something that was material. So in this case, the
(20:33):
prosecution is based on hearing before the Senate Judiciary Committee
on September thirtieth, twenty twenty, and at that hearing, Senator
Ted Cruz asked mister Comy whether he had authorized someone
at the FBI to be an anonymous.
Speaker 9 (20:46):
Source in news reports.
Speaker 8 (20:48):
The indictment says that mister Comy misled the committee by
saying that he had not done so. Now, Comy's lawyers
have attacked that indictment by saying that the questioning by
mister Cruz was vague and imprecise, and point out that
at the time that Senator Cruz was questioning mister Comy
about whether he had authorized anybody to leak information, that
Senator Cruz was referring to Andrew McCabe, who once served
(21:11):
as mister Comy's deputy at the FBI, and was not
referring to Daniel Richman, who had been a former FBI
employee and later became the attorney for James Comy. So
they're arguing that the indictment is defective on its face,
because in order to prove that mister Comy lied, you
have to show that there was a clear question and
that he gave a clearly false, a knowingly false answer
(21:34):
to it, and that he had an intention to mislead
the committee, and that the information he provided that was
false was material, and that this somehow obstructed the relevant
congressional proceeding. They say that that information is not contained
in the indictment, and one of their emotions is the
requirement that the government provide that information.
Speaker 9 (21:53):
So what you have here basically.
Speaker 8 (21:55):
Is an argument that the indictment is defective on its face. So,
in other words, it's not had an argument that the
government has its facts throng, because a factual dispute is
something that has to.
Speaker 9 (22:05):
Be resolved by a jury at trial.
Speaker 8 (22:07):
They are arguing that this is a decision that really
needs to be made by the judge because on its face,
the government is unable to prove the charges. The allegations
in the indictment simply are not enough to sustain a
valid conviction, and that's why they're filing this whole slew
of arguments to try to get this case dismissed before
(22:28):
it ever goes to trial.
Speaker 4 (22:29):
And prosecutors would not be able to bring the charges
again because the statute of limitations has run out, and
supposedly that's why the indictment was rushed through. Comy's indictment
came just five days after President Trump had demanded on
truth Social that Attorney General Pam Bondi bring charges against Komy,
(22:53):
New York Attorney General Letitia James, and Senator Adam Schiff.
So legal experts were talking about as selective and vindictive
prosecution motion even before the defense made that motion in
the case. Comy's motion papers include a sixty page long
list of links that detail Trump's negative comments about him
(23:16):
over the years. How strong is their vindictive prosecution motion?
I know it's very hard to get a case dismissed
on those grounds, That's exactly right.
Speaker 8 (23:27):
I mean, motions for vindictive prosecution.
Speaker 9 (23:29):
Are exceedingly hard to win.
Speaker 8 (23:31):
They require defendants to prove the prosecutors have displayed animus
towards them while they were seeking to exercise their rights,
and that the charges never would have been brought except
for that animus. Now, prosecutors have argued in response that
the comments made by President Trump to prosecute mister Komy
were only suggesting that if mister Komy committed a crime,
(23:54):
that they ought to prosecute him, and that he was
not directing the Department of Justice to prosecute mister Komey
regardless of whether or not a crime was committed. We'll
have to see how the judge handles that at the
end of the day. But the vindictive prosecution standard is
fairly high and that may be a difficult argument for
the defense to prevail on.
Speaker 4 (24:12):
We'll see how it goes at the hearings next week.
Thanks for a great conversation, Bob. That's former federal prosecutor
Robert Mintz of McCarter and English. Coming up next on
the Bloomberg Law Show, Michael Jordan's racing team scores a
key victory in court in its antitrust lawsuit against NASCAR.
(24:33):
I'm June Grosso and you're listening to Bloomberg.
Speaker 10 (24:36):
Look I've been a fan of the game for a
long period of time, you know, and you know, when
we first started this coal process, I've always said that
y'all want to fight for the betterment of the sport.
Speaker 4 (24:46):
You know.
Speaker 10 (24:46):
Even though they try to point out that, you know,
we made you know, some money, or we had successful business,
that's not the point. The point is is that the
sport itself needs to continually change for the better for
the fans as well as for the teams as well
as from NASCAR tooth.
Speaker 4 (25:00):
They understand that Michael Jordan's racing team scored a huge
win off the track in its anti trust case against NASCAR.
Jordan's twenty three to eleven racing team and front Row
Motorsports claimed that NASCAR acts like an illegal monopoly in
a dispute that centers on new charter agreements which both
(25:22):
teams refuse to sign, and on Tuesday, a federal judge
agreed that NASCAR controls the market for premier stock car
racing and granted partial summary judgment to the two racing teams.
The decision turns up the pressure to settle ahead of
the December one trial date. Although Jordans says he's ready
(25:43):
for trial.
Speaker 10 (25:44):
I look forward to going down on the fire. If
I have to fight this to the end for the beliment.
Speaker 1 (25:49):
Of the sport, I will do that.
Speaker 4 (25:51):
Joining me is anti trust law expert Harry First, a
professor at NYU Law School. Harry explained Michael Jordan's anti
trust case against NASCAR.
Speaker 6 (26:01):
This is a tussle between the family that has controlled
NASCAR and I guess stock car racing for many years,
almost uniquely in sports.
Speaker 1 (26:11):
You know, most sports.
Speaker 6 (26:13):
Are controlled by groups of team owners, but this is
one that's only controlled by one family, this France family.
You know, I guess It's had its ups and downs,
but it's pretty up now.
Speaker 1 (26:25):
You know.
Speaker 6 (26:25):
They're sort of the only real game in town for
the top Line Cup racing. There basically been arguments between
the owners of these racing teams and the Frances over
who's going to sort of split the money, particularly broadcast revenue.
I think they both need each other. Race car owners
(26:48):
need tracks to race on, and NASCAR, you know, has
made itself through a series of moves, acquisitions and so forth,
is basically the only place where you can have these
high level races. And of course you've got to have
the race cars racing or else you've got nothing to show.
So they both need each other. But apparently the racing
(27:09):
teams have not been hugely profitable unlike other sports. It's
very expensive to maintain these, according to the litigation anyway,
and the Frances, So the plaintiffs say, the plaintiff's being
two of these teams, and one being this twenty three
to eleven racing, which is Michael Jordan's. The plaintiffs say
that the Frances take most of the revenue, particularly the
(27:33):
broadcast revenue, and we're not getting enough, you know. The
Francis say, well, you don't like it, take it or
leave it, and that's when the litigation particularly broke out.
Speaker 4 (27:43):
It sounds like anti trust to me, but sounds like yeah,
sounds like it.
Speaker 7 (27:48):
Is it?
Speaker 4 (27:48):
So this partial summary judgment was about the relevant market,
which we've talked about before is key to anti trust.
Speaker 6 (27:57):
So the litigations had a little back and forth. The
district court judge seems pretty well disposed of the plaintiff's claims,
at one point issuing this injunction requiring NASCAR to admit
the two teams into the I guess it was a
twenty twenty four Circuit and the Court of Appeals knocked
(28:17):
that down for various reasons.
Speaker 1 (28:19):
So the district.
Speaker 6 (28:21):
Court judge granted the plaintiff's motion for partial summary judgement.
I mean, some of the important issues are now out
of the case, and particularly, as you mentioned, this contentious
issue over what's the relevant market. Is it just this
NASCAR premiere racing market? Does it include you know, other
(28:41):
kinds of stock car racing? There are other tiers? Does
it include other motor sports? The game and anty trust
if you're a defendant, is to constantly include different kinds
of substitutes.
Speaker 1 (28:53):
Of what people would watch. But here the market is
a labor.
Speaker 6 (28:57):
Market that they're arguing about, and the question is, you know,
what are the choices available for these race car drivers
who are selling their services? And this is basically it.
So it looked like a pretty strong claim on market definition.
But proving market definition is expensive, you know, requires lots
(29:17):
of experts, and this is before you get to the jury,
this summary judgment stage. But a lot of the record's
been developed, and the district court judge sort of took
an interesting turn on this. He said, well, if there's
a dispute of fact, which there always is, in market definition.
I think it's really broad. You know, while you could
(29:39):
have lots of race car drivers, there are lots of
choices that the race car drivers have. I think it's
really narrow, say the plaintiffs. So lots of things to
argue in front of a jury. But the judge says, ah,
guess what, NASCAR you filed a counterclaim against these driver
teams which had gotten together to jointly negotiate with NASCAR
(30:03):
over these agreements that they're charges. So we're alleging that
you sort of engage in a price fixing conspiracy. So
they filed a counterclaim. Now, unfortunately for them, when you
file a complaint in anty trust, normally you have to
put in your complaint what the relevant market is. So
(30:23):
they defined a market which was pretty much the same
as the market that Michael Jordan defined, but basically the
same labor market. It's these racing teams, you know, the
premier stock car racing group, you know, at the very top.
Speaker 1 (30:39):
So they basically define the same market.
Speaker 6 (30:41):
So the judge says, sorry, you've already admitted it, and
you know, we hold that you've made this admission. That's
your admission, So we're done, and you're done and we
don't have to try this issue. I'm sure that defendants
and their lawyers were not all that happy with that,
and I mean, I think it's pretty supportable on appeal,
(31:02):
and there would have been ways to handle the complaint
that didn't fall into this trap. But they were sort
of too clever by half. It was a very clever counterclaim,
but there was no requirement that they even needed to file.
Speaker 4 (31:16):
It is this sort of the ballgame.
Speaker 1 (31:17):
Then well it's not quite the ballgame.
Speaker 6 (31:20):
So the judge also did something else, not just the
market definition, but you have to.
Speaker 1 (31:24):
Have monopoly power or in this case monops.
Speaker 6 (31:27):
A EE power as the sole buyer, and there have
to be high barriers to entry, hard to get into
this market. And the judge found on all of those things.
You know, they've had this position for years and years
as the sole buyer. It's very hard to have a
competing leg. It's hard to even start your own racing team.
(31:48):
They had estimates on that in the record. So the
judge said, no, you've got this high entry barrier. It's
very hard to enter. There are really no substitutes. There
aren't other teams out there, you know, to race. So
on the having monopoly or monopsony power interrelevant market is
now out of the case, but that still leaves the
(32:10):
question really two questions. One is they have to engage
in some anti competitive conduct that maintains their monopoly position,
and that's still going to go to trial, and that involves,
you know, maybe their acquisitions of these other tracks, which
they did. There were some exclusive agreements. There's this agreement
(32:32):
that if you sign an agreement, you wave your.
Speaker 1 (32:34):
Anti trust claims. All of those will go together into
a trial.
Speaker 6 (32:39):
And then there's the question of damages and that's going
to be interesting because you know, the plaintiffs want more money.
Speaker 1 (32:47):
As a plaintiffs always won isay, you took too much,
I didn't get enough. But they have to.
Speaker 6 (32:52):
Show what the competitive rate would be for these teams,
and you know that's going to be a battle of
they're economists. So there's still a distance to go. Maybe
we'll never get there, and the parties are now going
to settle. I don't know, but this I think was
a pretty big win for the plaintiffs.
Speaker 4 (33:11):
They've had mediation sessions and private negotiations which obviously haven't worked.
But after the last court hearing, Michael Jordan said, settlement
has always been on the table, and the pressure is
on when the trial date is coming up soon.
Speaker 6 (33:26):
And it seems to me what they're really arguing over
is how do we split the pot so that the
teams have enough money to invest in these fast cars
and you know, all the things we need to do,
and you know, at the end of the day, perhaps
unfortunately for consumers, there's not going to be another circuit
because these are private.
Speaker 1 (33:47):
Plaintiffs pursuing this.
Speaker 6 (33:48):
So the goal is not to split up nascars so
there are competing circuits and you'd have real competition in
this kind of racing. This is not Michael Jordan's goal.
That's not the goal of private parties. The goal is
to basically split the monopoly profits differently so they will
likely benefit you know, consumers. I don't know, maybe not
(34:12):
so much.
Speaker 4 (34:12):
If I'm the defendant. I don't want to be in
a courtroom sitting opposite Michael Jordan with his star power.
I mean, you know how juries are mesmerized right by stars.
Speaker 6 (34:24):
Asking for damages in a jury trial is a good move,
particularly these days. I mean, juries have come in with
some pretty big verdicts in these big cases against major defendants.
Speaker 1 (34:35):
You know, Google is one example. So, yeah, defendants have
never liked Church. Let's put it that way.
Speaker 4 (34:42):
Yes, defendants do always seem to prefer a bench trial.
Before I let you go, Harry, I just want to
get your take on the bidding war between Pfizer and
Novo Nordisk over the obesity drugs startup met Sarah, which
has some antitrust implications. Pfizer had initially agreed to buy
(35:02):
met Sarah for four point nine billion dollars in September
and then let the bidding begin. The reports now are
that Pfizer has matched Novo's ten billion dollar bid.
Speaker 6 (35:13):
This is an old fashioned bidding war. I keep saying
to people, this is obviously a really fat market for profits.
So the global market for weight loss drugs is now
figured out about seventy two billion dollars and in another
five years projected to be about one hundred and forty billion.
I mean, this is huge money. This is sort of
(35:35):
a fun fight, I guess, particularly if you're a shareholder
of Metzarah. What I love is the revenues of met
Sarah for this year have been zero. They don't have
a product their weight loss drug is now entering Phase
three clinical trials, which many but not all drugs get
(35:56):
through successfully. So everyone's betting that this will go through
through successfully. But it's not out yet and it hasn't
been approved yet by the Food and Drug Administration. But
Pfizer doesn't have a weight loss drug, and Novo Nordisk
is having a lot of financial problems even though they
probably have about fifty percent of the market, with those
(36:17):
Zembic and Wagovi literally having the rest. You know, this
is a market. It's not one hundred percent monopolized like NASCAR,
but maybe larger implications for health and money than nascars.
And the tactics that are being used are really quite
interesting because Phizer is not only arguing that Novo Nordists,
(36:40):
at least at a time higher bid, couldn't and shouldn't
be accepted and so in violation of their agreement that
they had, they've also filed the preemptive any trust case
against Novo Nordisk and Metsera alleging that their agreement, this
merger agreement is illegal.
Speaker 1 (36:59):
They've not only.
Speaker 6 (37:00):
Tried to stop it in Delaware Chancery Court, which has
normal jurisdiction over corporate matters, but they've also filed in
federal court in Delaware a separate any trust case. I'm
alleging some very unusual things about this deal and alleging
that the deal itself is illegal under the Sherman Act
(37:21):
monopolization any competitive and under the Clayton Act, and the
Federal Trade Commission has gotten involved a little bit as well.
Speaker 1 (37:29):
The FTC.
Speaker 6 (37:30):
You know, there's this shutdown that they haven't been able
to do anything. Lo and behold, they awaken from their
slumber and for the first time in almost a month,
they granted early termination. You know, when you have a
merger you have to file, you wait for thirty days
at least to give the government forcers time to at
(37:51):
least see if they want to get more information. They
gave Fizer's bid early termination after fifteen days in the
middle of this shutdown, saying, hey, no prob even though
apparently Pfizer has some weight loss drugs in its own pipeline.
Speaker 1 (38:07):
Not clear exactly so, but they said, hey, no problem
with that.
Speaker 6 (38:11):
And then they issued a letter to the lawyers for
Lenovo Nordisk.
Speaker 1 (38:17):
And met Sarah.
Speaker 6 (38:19):
We've read about this deal which has not been filed
with the federal takers. We read about it, and we're
a little concerned that it may violate the Hartscott Rodino Act,
which involves notification to the government that you're planning around
with this, and so you better watch this.
Speaker 1 (38:38):
So what exactly is.
Speaker 6 (38:40):
Going on, I don't know, but they seem to be
putting a little thumb on the scales in favor of Pfizer,
whether intentionally or not. But they've really injected, sorry, they've
injected themselves into this. It's an old fashioned antitrust tactical bruhaha.
You know how it's going to end up, I'm not sure,
(39:02):
but it's really something to be watching. This is one
with real implications for competition.
Speaker 1 (39:08):
And for health.
Speaker 4 (39:09):
Who knew that weight laws drugs would also involve antitrust?
Thanks so much, Harry. As always, that's Professor Harry First
of NYU Law School. And that's it for this edition
of The Bloomberg Law Show. Remember you can always get
the latest legal news on our Bloomberg Law Podcast. You
can find them on Apple Podcasts, Spotify, and at www
(39:30):
dot Bloomberg dot com, slash podcast Slash Law, and remember
to tune into the Bloomberg Law show every weeknight at
ten pm Wall Street Time. I'm June Grosso and you're
listening to Bloomberg
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