Monday, September 26, 2022

Search Warrants and National Security


When we last discussed the search warrant for Trump’s Mar-a-Lago residence, Trump was flummoxed that his appointed judge had found probable cause to issue the warrant. So he went to a different judge that he had appointed (Judge Cannon) to get an injunction against the use of the materials seized. His belief was that a Special Master should be appointed to review the seized items. The ultimate goal was to have some of the items returned to him and to have others taken from investigators for a number of inconsistent and mutually exclusive reasons.

Trump’s lawyers and the Department of Justice both proposed two names to be the Special Master, with the DOJ eventually agreeing to one of Trump’s proposed Special Masters, Judge Raymond Dearie. 

In Cannon’s appointment of Judge Dearie, she also set the rules for his review of the items seized in the warrant. She said he was to review everything but that the DOJ could continue, for classification purposes only, the review of approximately 100 documents with top secret or similar markings. The DOJ was prohibited from using the materials for any other purposes, including the continuation of their criminal investigation. 

It was clear to the DOJ that Trump’s goal in having a Special Master appointed was to delay and obfuscate the proceedings as long as possible and to throw in as many objections as possible. So they had a choice. They could either sit back and wait for Judge Dearie to complete his review (which could take months) or to appeal Judge Cannon’s order to the 11th Circuit Court of Appeals. 

The cynical among us would first look at the composition of the 11th Circuit. In all likelihood, they would be Trump-appointed judges. The DOJ decided to appeal but did so in a brilliant manner. They could have appealed the appointment of a Special Master, but the 11th Circuit could very well deny that appeal on the grounds that Judge Cannon was simply exercising judicial discretion.

Instead, the DOJ focused on a singular issue – the national security interest in protecting top secret documents and in taking prompt and prudent action to make sure that (1) our national security was not compromised and (2) any criminal activity related to those documents was vigorously pursued. 

It came as no surprise that the three-judge panel hearing the DOJ appeal had two members appointed by Trump. That mattered not. It took the court mere days to rule, unanimously, that the DOJ was correct in its analysis. Their decision reversing Judge Cannon was as brutal a rebuke as you will ever see from a court. Typically, a court will say that the judge “erred” in her analysis. This court said that she had “abused her discretion.” This is the judicial equivalent of asking “Are you kidding me????” There are four legal standards that Judge Cannon was supposed to meet to justify her order. The 11th Circuit found that she was wrong ON ALL FOUR. 

Within 18 hours of the 11th Circuit decision, Judge Cannon “amended” her previous order, giving the DOJ full authority to use those 100 documents for criminal investigation purposes. 

Special Master Judge Dearie, who is highly respected jurist, was in the unenviable position of sitting in the middle of this ping pong match. He had been dutifully following Judge Cannon’s directives, but when the 11th Circuit ruling came down, his marching orders changed in an instant. 

Judge Dearie has adopted a no-nonsense approach. He hired another judge to help expedite the review of the materials (at $500/hour with the cost to be paid by Trump). He also gave Trump’s attorneys one week to decide whether Trump would argue, under oath, the various claims he has been promoting on Truth Social and his favorite talk shows. This is the judicial equivalent of “put up or shut up.” The smart money is not on “put up.” 

This would be the end of my post were it not for something I have never seen before. Decisions of appellate courts are often quoted in later cases as a matter of establishing the credibility of those rulings. It is typically months, if not years, before a decision is quoted. 

The 11th Circuit decision was quoted in, get this, 17 hours! 

Mike Lindell, the My Pillow guy, had his phone taken by the FBI at a Wendy’s drive-through. He argued that he should get it back. Forget for the moment that his legal argument was poorly constructed. What was notable was that the court denied his request, quoting the 11th Circuit. 

I’ve had cases where the judge has asked whether I had any more recent case authority to support my position. That was probably not an issue here.

Friday, September 23, 2022

The How and Why of New York’s fraud case against Donald Trump

The long-expected civil fraud case against Donald Trump and others was finally filed this week. It is 220 pages of allegations against 16 defendants, covering 11 years of alleged misdeeds, 20 different properties, and 16 different varieties of fraud. To say the complaint is comprehensive is an understatement. 

It is not my purpose here to get into whether or not the case has merit, though there is certainly enough to survive a motion to dismiss. Instead, it makes sense to step back and answer some frequently (and not so frequently) asked questions. 

Why file a civil case rather than a criminal one? There are a number of reasons. First, civil cases are easier to prove. You only need to prevail by a preponderance of the evidence rather than showing guilt beyond a reasonable doubt. Second, a defendant has no fifth amendment rights in a civil case. You may recall that when Trump was subpoenaed to testify, he refused to answer more than 400 times. That refusal may be used by a jury to infer culpability. Third, in a civil case you may get a money judgment. Here, we are looking at the possibility of $250 million. Fourth, in a civil case you can get more than just money. One of the results of this case could prohibit Trump from doing business in the State of New York. Fifth, you can sue someone without stating he is a criminal, something that defendants often decry to show that they are being unjustly prosecuted. Sixth, a state civil case cannot be dismissed with a pardon. Seventh, there is still the possibility that Trump and his family may face criminal charges. However, those cases should be filed by a different party, such as the IRS. 

Why file the case now for conduct going back to 2011? The timing seems a bit suspect. Blame Trump for this one. For many years he has used every possible legal maneuver to keep relevant information from the attorney general, including tax and accounting records. It was only last month that the attorney general was finally able to obtain records from Mazars, one of Trump’s accounting firms. This was the missing piece of the puzzle. 

Why are there so many defendants besides Donald Trump? The answer to this is finger pointing. One common defense to fraud is that “somebody else did it” and that the complaint should be dismissed for that reason. The complaint names all of the major parties who could be that “somebody else.” A second reason to name multiple defendants is that they may have different levels of involvement or defenses to the actions. In many cases, defendants within the same lawsuit may throw others under the bus in order to escape personal liability. 

Why does the alleged fraud cover 11 years? Proving that conduct occurred over multiple years eliminates the defense that this was an inadvertent, one-time “mistake.” 

Why does the alleged fraud include 20 different properties owned by Trump or his organizations? Similar to the multi-year rationale, the attorney general can show that fraud was pervasive and took many forms. 

Why didn’t the attorney general sue Trump for other wrongdoing? First, the fraud complaint is complicated enough without adding in other allegations. Second, lawyers try to not add weak allegations when they already have a strong one. Third, confining the allegations to fraud eliminates the defense that the attorney general is “piling on.” Furthermore, there is no reason why a separate lawsuit covering other matters could not be brought later on. 

If this case goes to trial, when will that happen? Years from now. 

Then what will the impact of the lawsuit be between now and trial? The lawsuit provides sunlight. Much of Trump’s traditional answer to prospective charges is that they are politically motivated or a “witch hunt.” Here, the attorney general has provided chapter and verse of wrongdoing. In addition, prospective lenders are now on actual notice that the Trumps may have engaged in questionable business practices. Lenders tend to be reluctant to provide financing to those with a history of fraud.

The complaint, as lengthy as it is, is only required to show that bare bones of the fraudulent conduct. Much greater and potentially damaging detail will come out as the lawsuit progresses. By the same token, any defenses will also come to light.

Monday, September 5, 2022

So Now We Have a Special Master

Today, Judge Aileen Cannon, a federal district court judge in Florida, granted Donald Trump’s request for the appointment of Special Master to independently review materials acquired during an authorized search in Mar-a-Lago. 

The reasoning in Judge Cannon’s 26-page order showed that even a moderately qualified judge can be a talented contortionist. I’ll leave the legal shortcomings of the opinion to be parsed by others. Stepping back, though, a few things are notable. 

First, there is nothing in the order to indicate that the search of the premises was either illegal, ill-advised or politically motivated. In fact, the judge noted that: 

[T]he Court agrees with the Government that, at least based on the record to date, there has not been a compelling showing of callous disregard for Plaintiff’s constitutional rights. This factor cuts against the exercise of equitable jurisdiction.

That talking point about the search warrant has bitten the dust. 

Second, one of Judge Cannon’s reasons to appoint a Special Master is, to use her words, “the interest in ensuring the integrity of an orderly process amidst swirling allegations of bias and media leaks.” She further noted that “[a] commitment to the appearance of fairness is critical, now more than ever.” 

As reasonable as this sounds, Judge Cannon failed to address the fact that she was appointed by then-president Trump, and that she had indicated, even before the government was able to present its arguments, that she was “inclined to grant the injunction.” 

When the “appearance of fairness” is at issue, a judge will often recuse (refuse to hear the case). She never even mentioned that possibility, as ethical judges are wont to do. Instead, she also found that “[t]hough somewhat convoluted, this filing is procedurally permissible.”

Third, even while stopping the investigative use of the seized materials, the judge held that “The Government may continue to review and use the materials seized for purposes of intelligence classification and national security assessments.” Allowing this review to continue showed that there were national security concerns raised by Trump holding onto official archival records. Apparently, including this review in the injunction order was a bridge too far. 

The Department of Justice is currently weighing whether or not to appeal Judge Cannon’s order. The investigative delay caused by appointing a Special Master is a minor inconvenience at best.