Category Archives: Law

Still Looking for Evidence

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WSJ Dec. 1, 2017 7:01 p.m. ET

Robert Mueller’s special prosecution machine grinds on, and on Friday it crushed former national security adviser Mike Flynn on the ever-ready charge of lying to the FBI. The guilty plea is a tragedy for the former three-star general and head of the Defense Intelligence Agency, but whether it is ominous for the Trump Presidency depends on what Mr. Flynn is telling Mr. Mueller.

Prosecutors signaled Mr. Flynn’s cooperation by filing an “information,” rather than an indictment, on charges of making false statements about his meetings with former Russian Ambassador Sergey Kislyak in two December 2016 meetings. The meetings discussed the U.S. and Russian responses to sanctions that President Obama had imposed on the Kremlin for meddling in the 2016 campaign.

This specific charge is surprising because, as a seasoned intelligence officer, Mr. Flynn had to know that the U.S. would be listening to Mr. Kislyak’s conversations and have transcripts. CNN reported on Feb. 17 that “the FBI interviewers believed Flynn was cooperative and provided truthful answers,” even though he first said sanctions were not discussed and later said he couldn’t recall.

A Congressional source also tells us that former FBI director James Comey told the House Intelligence Committee on March 2 that his agents had concluded that Mr. Flynn hadn’t lied but had forgotten what had been discussed. Perhaps the FBI changed its view.

Or perhaps Mr. Flynn felt he was facing more serious charges that could be mitigated by copping a plea to a single count and cooperating. A legal defense would require hundreds of thousands of dollars that a longtime military family doesn’t have, and his son, Michael Jr., was also under investigation. News reports Friday said the son won’t now be prosecuted.

Mr. Flynn could still face up to six months in prison, and his sentencing will be postponed and depend on what his plea agreement says is his “substantial assistance in the investigation or prosecution of another person who has committed an offense.” Mr. Mueller is known for his brutal mercy.

How this relates to the claim of Trump campaign collusion with Russia during the 2016 presidential campaign isn’t clear. Mr. Flynn’s meetings with the Russian ambassador occurred after the election. The press corps is hyperventilating that a statement filed in connection with Mr. Flynn’s plea says an unnamed senior Trump transition official spoke with Mr. Flynn about what he should tell the Russian ambassador. News reports Friday identified that official as Jared Kushner, Donald Trump’s son-in-law.

Yet there is nothing scandalous, or even unusual, about a presidential transition meeting with a foreign ambassador. The statement says Mr. Flynn was advised that the transition team at Mar-a-Lago “didn’t want Russia to escalate the situation”—which also isn’t a crime even if they should have waited until taking office before conducting foreign policy.

For what it’s worth, Mr. Trump’s attorney Ty Cobb on Friday portrayed Mr. Flynn’s plea as no big deal: “The false statements involved mirror the false statements to White House officials which resulted in his resignation [as national security adviser] in February of this year. Nothing about the guilty plea or the charge implicates anyone other than Mr. Flynn.”

Nothing in Friday’s documents shed more light on what happened during the 2016 presidential campaign. Perhaps Mr. Flynn has more secrets to share, and Mr. Mueller seems to be targeting Mr. Kushner for a turn of his screws. But in today’s hyperpartisan Washington it pays to wait for the evidence.

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DNC and the Law – WSJ

Don’t hold your breath waiting for DOJ to investigate.
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WSJ 11/13/2017
By Cleta Mitchell And Hans von Spakovsky

Donna Brazile has confirmed Bernie Sanders’s worst suspicions. Ms. Brazile, who served as interim chairman of the Democratic National Committee during the fall 2016 campaign, says in a new book that during the primaries, the DNC was controlled by Hillary Clinton’s campaign. Ms. Brazile claims the arrangement was “not illegal,” but that is far from clear.

Ms. Brazile reports that when she arrived on the job in July 2016, Gary Gensler, the campaign’s chief financial officer, told her the DNC was fully under the control of the campaign. In September 2015, 10 months before Mrs. Clinton’s nomination, the party had moved its bank account to the same bank in New York used by the Clinton campaign and created a joint fundraising committee, the Hillary Victory Fund, whose treasurer, bank account, and control were vested in the campaign. Then, in an August 2015 memorandum of understanding, the DNC essentially handed over its operations to the Clinton campaign for the next 15 months.

The purpose of joint fundraising committees is to allow more than one entity to collaborate in raising money and share in the costs. Each participant is subject to federal contribution limits. When the party itself is a participant, its committee (in this case the DNC) normally handles accounting and financial controls. Not here. The Hillary Victory Fund was controlled by the Clinton campaign, with a campaign employee as treasurer and the fund’s bank account established at the Clinton campaign’s bank. According to Federal Election Commission reports, the Hillary Victory Fund has raised more than $526 million.

The DNC asserted its “neutrality” by also entering into a joint fundraising committee with the Sanders campaign. It raised a total of $1,000. And the Bernie Victory Committee treasurer was the DNC’s designee.

“Money in the battleground states usually stayed in that state,” Ms. Brazile writes, “but all the other states funneled that money directly to the DNC, which quickly transferred the money to Brooklyn”—i.e., Clinton headquarters. She says state parties raised $82 million, of which they kept less than 0.5%.

The memorandum of understanding promised the Clinton campaign, among other things, “complete and seamless access to all research work product and tools” paid for by the DNC, despite Federal Election Commission regulations that prohibit privately sharing such research with a candidate without either reporting the costs as an in-kind contribution or allocating them against the party’s coordinated spending limits for that candidate.

The memo also tied transfers of funds raised for the DNC by the Hillary Victory Fund to operational control of the DNC’s expenditures: “The release of the Base Amounts each month are conditioned on the following: . . . hiring of DNC Communications Director . . . DNC senior staff . . . joint authority

over strategic decisions . . . alerting HFA”—Hillary for America, the campaign—“in advance of . . . any direct mail communications that features a particular Democratic primary candidate or his or her signature.”

Contributions to the DNC, even though made through the Hillary Victory Fund, were required by law to be transferred to the party and could not legally be withheld by the Clinton-designated treasurer. Nor does the law allow a single candidate to control a political party’s operations and expenditures.

National party committees have higher contribution limits than candidates do—$334,000 a year vs. $2,700 for each election. The memorandum raises the possibility that Clinton campaign took advantage of the DNC’s higher limits, then availed itself of all the resources the DNC could buy—without having any of the attendant costs or expenditures assessed against the campaign.

There are strict statutory limits on what a party committee can contribute to any candidate and what a party can spend in coordination with its candidates. We don’t like limits on the ability of parties to support their candidates. But campaign- finance zealots, egged on by media outlets (which are not subject to any limits), made certain that the McCain-Feingold law of 2002 stringently limited coordination between candidates and political parties. Although the Supreme Court struck down parts of McCain-Feingold in the 2010 Citizens United case, the coordination limits still apply. The FEC and the Justice Department should investigate the Clinton-DNC arrangement.

Candidate Clinton railed against Citizens United— a case that involved a documentary film critical of her— arguing that “big money” and “secret spending” are ruining our politics. Is it too much to ask that those who loudly demand greater regulation of political speech and spending themselves abide by the laws already on the books?

Ms. Mitchell is a partner at Foley & Lardner LLP who practices federal campaign finance law. Mr. von Spakovsky is a senior legal fellow at the Heritage Foundation and a former commissioner on the Federal Election Commission.

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Unfinished Preet Bharara Business

If this doesn’t give you the creeps about what the Gov can do, it should.
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WSJ 4/20/2017

President Trump dumped Preet Bharara as U.S. Attorney for the Southern District of New York, and the celebrity prosecutor is conducting another media vindication tour. But a few problems from his tenure are left to resolve, including the ongoing legal crusade against David Ganek.

When we last checked on this saga, the Southern District had appealed a district judge’s ruling that discovery and trial could proceed in Mr. Ganek’s lawsuit against Mr. Bharara and the Federal Bureau of Investigation. The investor alleges that law enforcement violated his civil and constitutional rights with a 2010 insider-trading raid on his hedge fund, Level Global. The press was tipped off beforehand, Mr. Ganek was named as a suspect, and the reputational damage of the media circus ruined the firm.

Mr. Ganek was never charged with a crime, and the fraud conviction of one of his portfolio managers was overturned on appeal as an appellate court held that Mr. Bharara’s insidertrading theories exceeded the law. The feds now concede—or used to—that the affidavits used to obtain the Level Global search warrant contained false information about Mr. Ganek’s involvement in this non-scheme. Maybe these misrepresentations were honest mistakes, but that’s all the more reason to review evidence of the investigation such as emails and interview transcripts in public.

Instead, the Southern District is hiding behind the doctrine of prosecutorial immunity— and re-smearing Mr. Ganek to evade accountability for its botched investigation. At oral arguments late last month, a Second Circuit Court of Appeals panel seemed skeptical of the government’s arguments. So under questioning deputy U.S. attorney Sarah Normand accused Mr. Ganek of participating in “a scheme with regard to many, many pieces of inside information from many public companies.”

This accusation was never raised in the copious pretrial and appeal briefings, and presumably if prosecutors had anything solid on Mr. Ganek they’d have sought an indictment at the height of Mr. Bharara’s insider-trading bubble. Judge Reena Raggi noted that “certainly there’s no evidence at trial, or in the record that you’ve put forward, that the confidential informant or the cooperator ever said to law enforcement that Mr. Ganek did know that he was trading in whole or in part on inside information. That’s the record that we’ve got before us. That’s a statement made in the affidavit [that] is not true.”

The case’s larger import concerns accountability for alleged prosecutorial misconduct. Judge Alex Kozinski of the Ninth Circuit recently noted that improper and abusive behavior by prosecutors has reached “epidemic proportions.” If Mr. Bharara’s false affidavit was deliberate, it violated due process.

There’s also emerging evidence that something was rotten in Mr. Bharara’s operation. The FBI special agent who supervised securities fraud investigations in New York, David Chaves, who is also a defendant in the Ganek case, was recently cited for leaking confidential grand jury information in the insider-trading case of sports gambler William “Billy” Walters. Judge Kevin Castel issued an unusual order instructing the FBI to provide updates on Mr. Chaves’s internal disciplinary process.

According to emails revealed in the Walters case, Mr. Bharara knew about the leaks pouring out of the FBI’s white-collar unit, including to reporters at the Journal. He called it “outrageous and harmful” in a 2014 email, but as far as we know he did nothing to stanch the leaking. Earlier this year the FBI reached a rare settlement with the wife of a convicted insidetrader who was wiretapped in violation of the FBI’s eavesdropping guidelines. The terms aren’t public.

In other words, there’s a pattern of troubling behavior and a problematic culture inside Mr. Bharara’s old shop. Not least because there are so few consequences for prosecutorial abuse, the Second Circuit should allow Mr. Ganek’s suit to head to trial.

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A Libel Suit Threatens Catastrophe

If the left wants to take off the gloves, perhaps that is what should happen.
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By MICHAEL A. CARVIN and ANTHONY DICK
WSJ Feb. 5, 2017 8:16 p.m. ET

The First Amendment provides robust protection for political and scientific debate, but it faces a new threat from a climate activist determined to silence his critics. In a case pending before the District of Columbia Court of Appeals, Penn State professor Michael Mann is waging an aggressive campaign of lawfare, accusing of defamation those who dare to question his work. So far, the courts have given this assault on free speech a green light.

Mr. Mann is famous as the creator of the “hockey stick” graph, which portrays a dramatic trend in global warming over the past century. Numerous critics have cast doubt on the quality and accuracy of his work. They argue that his historical temperature proxies are unreliable, his data presentation misleading, and his statistical techniques skewed.

Even among those who support the theory of global warming, some have singled out Mr. Mann’s work as sloppy and exaggerated. David Hand, a former president of Britain’s Royal Statistical Society, has written that Mr. Mann’s technique “exaggerated the size of the blade at the end of the hockey stick,” which corresponds to the 20th-century temperature rise.

Not content to answer his critics in the public square, Mr. Mann has sued them. One target of his lawsuit is the political magazine National Review, which published a 270-word blog post criticizing Mr. Mann as “the man behind the fraudulent . . . ‘hockey-stick’ graph.” His lawsuit objects to the magazine’s decision to quote a critic who wrote that Mr. Mann “could be said to be the Jerry Sandusky of climate science, except that instead of molesting children, he has molested and tortured data.”

National Review moved to dismiss the suit, citing a phalanx of Supreme Court precedent. The Constitution obviously does not allow crippling damages to be imposed for voicing one’s opinion, however vehemently or caustically. Punishing such criticism because a jury disagrees with it does not aid the search for truth, but impedes it by stifling conflicting views. As the liberal Justice William Brennan observed: “Truth may not be the subject of either civil or criminal sanctions where discussion of public affairs is concerned.” Such speech “is the essence of self-government.”

As a federal court once put it in the particular context of scientific controversies: “More papers, more discussions, better data, and more satisfactory models—not larger awards of damages—mark the path toward superior understanding of the world around us.” Even a meritless defamation suit can be an effective weapon to intimidate critics and shut down debate through ruinous litigation costs.

In this case the trial court refused to dismiss Mr. Mann’s libel suit. Judge Natalia Combs Greene ruled that the defamation claims were “likely” to succeed because “to call his work a sham or to question his intellect and reasoning is tantamount to an accusation of fraud,” when in fact Mr. Mann “has been investigated by several bodies (including the EPA)” which determined that his research was “sound and not based on misleading information.” For procedural reasons, the case was reassigned to Judge Frederick Weisberg, who largely adopted Judge Greene’s reasoning.

Appellate courts, which exist to reverse such legal error, in this case compounded it. National Review was supported in friend-of-the-court briefs by such unlikely allies as the American Civil Liberties Union, the Electronic Frontier Foundation, the Washington Post and the Reporters Committee for Freedom of the Press. Yet a panel of the D.C. Court of Appeals—Judges Vanessa Ruiz,Corinne Beckwith and Catharine Easterly—held in December that Mr. Mann’s suit should proceed to a jury. The court again relied on various “official” investigations that had cleared Mr. Mann of misconduct, including an inquiry by the federal government. Speech that disagrees with the government is at the core of the First Amendment’s protection—though not in this court’s topsy-turvy world.

National Review has filed a petition for rehearing along with its co-defendants, the Competitive Enterprise Institute and Rand Simberg. If the full court of appeals does not correct the error and end this assault on the First Amendment, the case will doubtless proceed to the Supreme Court.

Those hoping Mr. Mann prevails because they agree with him about global warming are missing the point. If he succeeds in diminishing the right to free speech, he and his fellow climate activists have just as much to lose. Mr. Mann has attacked his critics for peddling “pure scientific fraud,” engaging in what he calls “the fraudulent denial of climate change,” and taking “corporate payoffs for knowingly lying about the threat climate change posed to humanity.” He accused Fox News of trying to “mislead its viewers” through a “deceptive” report about climate change.

None of this is particularly polite, but it is common in the cut-and-thrust of public debate. If such caustic criticism is now to be fair game for legal action, big oil companies and other well-heeled interests can launch their own lawsuits asking juries in Texas or Oklahoma to silence Mr. Mann and his allies.

The logic of Mr. Mann’s position threatens to convert political and scientific debate into a litigation free-for-all, with all sides seeking to sue one another into submission instead of resolving differences through the free exchange of ideas. For those who care about the spirit of open inquiry at the heart of the scientific enterprise, it is scarcely possible to imagine a greater legal disaster than the prospect of Mr. Mann’s succeeding on his claims.

Messrs. Carvin and Dick are Washington lawyers. They represent National Review in Mr. Mann’s lawsuit.

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