In short
The episode covers three legal/political topics plus a brief discussion of AI productivity tools. First, it explains the Huawei criminal racketeering trial in Brooklyn: prosecutors cluster allegations into (1) bank/wire fraud tied to sanctioned countries (Iran, North Korea), (2) trade secret theft/industrial espionage, and (3) a RICO conspiracy theory tying them into a continuous pattern. Guest Eric Talley (Columbia Law professor) says RICO requires predicate offenses plus evidence the acts were part of an organized, ongoing strategy. Notable examples include alleged unauthorized stealing of router source code, user manuals, and antenna technology, plus an employee allegedly breaking off a piece of a T-Mobile phone testing robot to study it. Huawei argues it’s competitive business, not conspiracy.
Second, Bloomberg reporter Chris Strom discusses a “grand conspiracy investigation” into Trump-era political enemies: a broad DOJ probe spanning Russia-election and Mar-a-Lago classified documents, with subpoenas and a grand jury, targeting figures like John Brennan and James Clapper.
Third, Thomas Schmidt (Columbia Law professor) discusses fixes for the Supreme Court’s “shadow docket,” arguing for more transparency and stricter equitable standards (irreparable harm) to curb unexplained emergency rulings.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VOBackground on Huawei's Legal Troubles
0:00 to 0:35
Overview of Huawei's legal challenges and charges against them.
“Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done.”
Background on Huawei's Legal Troubles
0:43 to 1:13
Overview of Huawei's legal challenges and charges against them.
“It's because AI hasn't reached the workflows yet.”
Background on Huawei's Legal Troubles
1:54 to 2:52
Overview of Huawei's legal challenges and charges against them.
“the world's biggest supplier of telecommunications network equipment.”
Understanding the RICO Charges
2:52 to 4:26
Discussion on the RICO charges and how the government will prove them.
“Eric, the government is really bringing a sprawling case against Huawei.”
Defense Arguments and Jury Considerations
4:26 to 6:34
Exploration of defense arguments and jury perceptions in the trial.
“But the company's attorney countered with, it's about competition, not conspiracy.”
Political Implications of the Trial
6:34 to 9:32
Analysis of the political context surrounding Huawei's prosecution.
“The Trump administration has moved away from criminally charging corporations.”
Consequences of a Conviction
9:32 to 12:50
Considerations of what a conviction could mean for Huawei and its market.
“Would it be better as far as presenting a case that appeals to a jury if the prosecutors charged some people along with this nameless, faceless giant tech company?”
Consequences of a Conviction
14:34 to 15:19
Considerations of what a conviction could mean for Huawei and its market.
“which means it's time for your first assignment of the school year, the back to school shopping list.”
Trump's Grievances and Conspiracy Theories
16:25 to 17:16
Explore President Trump's claims of conspiracies against him and historical context.
“Whether it was the investigation into Russian interference in the 2016 election or the investigation into his mishandling of classified documents.”
Justice Department's Investigation Overview
17:16 to 19:28
Learn about the Justice Department's broad probe related to Trump's claims.
“all in service of his theory of a grand conspiracy by Democrats to sabotage him over the course of a decade.”
Show all 17 chapters
Skepticism Towards New Investigations
19:28 to 24:15
Examine the skepticism surrounding the Justice Department's ongoing investigations.
“And he was only able to find one low-level FBI lawyer who lied on a document and that individual pled guilty.”
Changes in Leadership and Investigation Pace
24:15 to 28:01
Discuss the changes in investigation leadership and its impact on pace.
“I mean, sometimes it seems like the point is the investigation itself, the news about the investigation and just bringing charges like the Comey charges over the seashells on the beach.”
Resignation and Investigation Challenges
28:01 to 29:03
Learn about the resignation of a key figure in a high-profile investigation and the frustrations that led to it.
“And there's a lot of questions over what actually took place behind the scenes.”
Resignation and Investigation Challenges
29:11 to 29:48
Learn about the resignation of a key figure in a high-profile investigation and the frustrations that led to it.
“Some people treat ChatGPT like some kind of smart search engine and some use it to get work done.”
Understanding the Shadow Docket
31:58 to 39:44
Delve into the complexities and implications of the Supreme Court's shadow docket.
“The Supreme Court's emergency or shadow docket has grown exponentially in size and importance, with rulings in consequential cases often issued without explanation, leaving lower courts to puzzle over their meaning.”
Implications of Emergency Applications
39:45 to 42:02
Examine how the Supreme Court handles emergency applications and the challenges posed for lower courts.
“So last year, in a case called Boyle, the Supreme Court made clear that when it rules on the emergency docket, the lower court should follow it in like cases.”
Supreme Court's Equitable Intervention Analysis
42:02 to 44:39
Explore the Supreme Court's role in preserving the status quo during legal disputes.
“So for example, an individual justice alone can issue an administrative stay while an opinion is being worked out, right?”
Transcript
Automatic transcript. May contain errors.0:00Eric Talley:Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans.
0:42Eric Talley:This is Alexis Christophorus for Bloomberg Surveillance. Most companies have tried AI. Most aren't seeing results. Not because AI doesn't work. It's because AI hasn't reached the workflows yet. That's the gap Asana is built to close. Asana is the operating system for human agent teams. Ready-to-go AI teammates pre-built for marketing, ops, and IT. No prompt engineering. No setup. They show up where the work is happening. Already onboarded in your workflows. Ready to deliver. Asana. Where humans and agents workflow together. Try it at asana.com. That's A-S-A-N-A dot com. Adventure Global. we think about what can be done, not what's usually done.
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1:47This is Bloomberg Law with June Grosso from Bloomberg Radio.
1:53Eric Talley:During his first term, President Trump raised national security concerns about the Chinese company Huawei, the world's biggest supplier of telecommunications network equipment. Huawei is something that's very dangerous. You look at what they've done from a security standpoint, from a military standpoint, it's very dangerous. While the U.S. government lobbied Western allies to avoid using the Chinese company's products in their high-speed wireless networks, U.S. prosecutors charged Huawei with stealing technology, plotting to steal trade secrets, defrauding banks, and violating trade sanctions.
2:34Eric Talley:Eight years after those charges were brought, the criminal racketeering trial against Huawei is finally kicking off in Brooklyn, New York, in the shadow of a September 24th summit in D.C. between Trump and China's president, Xi Jinping. Joining me is business law professor Eric Talley of Columbia Law School. Eric, the government is really bringing a sprawling case against Huawei. Tell us about the charges. The government's trial against Huawei basically has three clusters of allegations. One is sort of bank and wire fraud actions that are related to business with sanctioned countries like Iran and North Korea.
3:17That's one cluster. A second has to do with trade secret theft, kind of industrial espionage. And the third is kind of a throw in. It's a racketeering charge that basically is a conspiracy theory that ties all three of these claims together.
3:31Eric Talley:The RICO charges are traditionally used to target organized crime conspiracies. How does the government prove a RICO case here? The thing that holds the same as the other two is that RICO basically requires what's sometimes known as a predicate offense, that there's got to be some underlying wrongdoing that is then sort of part of an overall strategy that is about a continuous organized pattern of criminal activity. So the triggers for RICO are actually still going to be the same as the first two allegations, trade secret theft and bank and wire fraud. But in addition, the government's going to actually have to bring evidence that these weren't just sort of one off events, but that they were part of a continuous, organized, orchestrated pattern of Huawei and not just, you know, spot cherry picked examples.
4:25Eric Talley:During the opening statements, the federal prosecutor told jurors that crime was a business strategy for Huawei. Theft lies corruption for 20 years. But the company's attorney countered with, it's about competition, not conspiracy. Innovation, not theft. Ordinary business dealings, not criminal conduct. Which argument do you think the jury will find more convincing? Well, one of the reasons this is going to trial is that both of these types of arguments are actually reasonably good. Huawei is 100 % correct that this is an incredibly competitive industry in which different manufacturers are essentially trying to one-up one another.
5:09And if you can sort of outflank your competition, even by a little, you can take an awful lot of market share. That's in many ways, very, very healthy forms of competition. But because employees go back and forth, because there are different business dealings, because there are trade fairs, it often can give rise to claims that you got your edge through an impermissible sort of approach. But Huawei's, you know, overall claim is that this is a really, really competitive industry. And it's unfair to look at specific anecdotes as a way to lay out some kind of a systematic pattern. They're just anecdotes.
5:44On the other hand, the government's got some decent anecdotes, You know, particularly on the trade secret dimension, they have got some pretty vivid examples of unauthorized stealing of source code for routers, user manuals, antenna technology. And they even have some evidence of one Huawei employee physically breaking off a piece of T-Mobile's phone testing robot to take back home and to study it. And so these are going to be pretty vivid, particularly for a jury, but they are also consistent with this being a very, very competitive industry. I think there's really going to be this sort of question about whether these specific events that the government has seemingly hard evidence about are going to be enough to convince the jury that this is really, you know, not only significant events that themselves constitute episodes of criminal activity, criminal trade secrets, but they're also part of this overarching, longstanding conspiracy.
6:41conspiracy.
6:42Eric Talley:The Trump administration has moved away from criminally charging corporations. Now it's pursuing this really ambitious prosecution against a Chinese company. What are the political overtones here? Well, it's an interesting political setting because this case started under the first Trump administration. It was then inherited by President Biden. And now it's being tried in a broader sort of U.S.-China technology, race and competition under the second Trump administration. It's relevant to note that even the Biden administration pushed the ball forward on this case. Huawei employee who was living in Vancouver was, in fact, you know, subject to extradition orders and entered into a deferred prosecution agreement.
7:28Some of the things that she essentially put into that settlement have now evidently been accepted as statements of fact by the trial court judge that are going to be difficult for Huawei to, you know, sort of push back against because it's from one of their own former employees. But, you know, one of the bigger stages here is not just Huawei itself or the Trump administration's attitude towards businesses and whether it takes a more hands-off approach or hands-on approach. There's an overarching U.S. versus China theme to this as well that has, you know, played a big role in the first Trump administration, continues to play a role in this Trump administration.
8:07And, you know, in many ways, some of the allegations had already been substantially served up on a platter before the second Trump administration actually was in power.
8:17Eric Talley:How successful have federal prosecutors been in prosecutions of Chinese companies? There have been some successes. This is a large company, however. This is not sort of a fly-by-night company that is, you know, essentially pilfering trade secrets here or there. And so, you know, in terms of the target of the size of Huawei, this is a significant move to make. And so one would expect also that Huawei would, in fact, they are putting up a pretty steep defense because, you know, the stakes are enormous. A couple of things that are also kind of worth noting, however, is that this is a criminal case against a company.
8:57So success by the government isn't necessarily mean that someone's going to go to prison. There aren't individuals who are basically co-defendants along Huawei here. And Huawei is already heavily restricted in terms of its presence in the U.S. market. And typically, in addition to whatever fines that might be levied against a defendant company in this position, usually the most potent form of remedy would be, you know, you basically have to leave the U.S. market. But Huawei's presence in the U.S. market is already, because of, you know, U.S. trade policy, relatively small. But the U.S. still could take a verdict in its favor in this case to try to persuade allies, suppliers and others to keep a distance from Huawei because it has been criminally convicted if the government ends up getting some sort of conviction in this case.
9:47Eric Talley:Would it be better as far as presenting a case that appeals to a jury if the prosecutors charged some people along with this nameless, faceless giant tech company? In some cases, it would. I think sometimes when you're dealing with these sort of corporate alleged misconduct cases, the jury might actually push back against that sort of saying, look, these are large, multi-person organizations. You're trying to throw one individual under the bus when really it was the organization that was at fault. And a jury, particularly if an individual defendant is looking at potential for prison time, that could actually induce them to be less anxious to vote to convict.
10:30On the other hand, you know, I think there is a sense in which the measure of success for the government is going to be a little bit less concrete than it would be in the context of an individual criminal defendant who's a natural person. So the government, you know, clearly has sort of decided for jurisdictional and possibly strategic reasons. They want to sort of keep this about Huawei, hopefully from their perspective, seize on a sentiment amongst the jurors that Huawei is an example of an unfair form of competition that is essentially skirting the rules, both of intellectual property and international sanctions and visiting a penalty on the company itself is the best way to move.
11:12You know, one thing that's going to be pretty interesting from the jury's perspective, and this particularly relates to the RICO charge, is how likely is it that the jury is going to be able to take this set of examples, some of which are quite vivid, like the breaking off of a piece of the robot, and say, oh, wait, no, that's part of an entire pattern and practice, as opposed to some cherry-picked anecdotes, which, you know, quite frankly, all prosecutors can usually find one or two examples of something that looks a little bit sketchy and then try to weave a story of a longstanding criminal enterprise.
11:44And that's going to be one thing to really watch here about whether the government is going to be able to stitch together these anecdotes and basically say, these aren't just anecdotes. These are a pattern. While Huawei is basically going to say, look, you just cherry picked some of the worst possible situations involving individual isolated employees, former employees, contractors of Huawei. But that was never part of our corporate strategy.
12:07Eric Talley:What's the government looking for if it wins? Huawei's already on a blacklist. And would any financial penalties that could be obtained really hurt this company. I think the financial penalty, though, given the fact that a lot of these assets are offshore, is going to be a harder one to pursue, at least in some circumstances. And as you noted, you know, Huawei is not going to be in a position where suddenly it's going to lose a bunch of customers in the U.S. since it currently doesn't have many customers in the U.S. since it's been blacklisted. So my sense is the real grab that a successful outcome for the Department of Justice would have is in effectively trying to throttle back Huawei's market share outside of the U.S.
12:50amongst trading partners who basically are told, look, if you continue to trade with what would then be a criminally convicted enterprise, that's going to have implications for your own dealings with U.S. markets. You know, the Trump administration has wielded that club many times thus far with tariffs and other contexts. So I could imagine that having a little bit of mileage, but there really is kind of a question given how global this market is and how several of our historical allies seem to be getting a little bit closer to China as the U.S. levies tariffs on them. There really is a question whether that's going to convince them.
13:28Eric Talley:This trial is expected to go into December. So we'll talk again, Eric. Thanks so much. That's Columbia Law School professor Eric Talley. Coming up next, the Justice Department is ramping up an investigation into Trump's perceived enemies that goes back a decade. I'm June Grosso, and you're listening to Bloomberg. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version.
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16:24Eric Talley:On the campaign trail, President Trump loved to regale audiences with his list of grievances over what he saw as a conspiracy to get him. Whether it was the investigation into Russian interference in the 2016 election or the investigation into his mishandling of classified documents. From the beginning, the Democrats spied on my campaign. Remember that? They attacked me with an onslaught of fraudulent investigations. Russia, Russia, Russia. Ukraine, Ukraine, Ukraine. Impeachment hoax number one. Impeachment hoax number two. The illegal and unconstitutional raid on Mar-a-Lago right here. Well, now that he's president, Trump is turning the tables on those who investigated him, all in service of his theory of a grand conspiracy by Democrats to sabotage him over the course of a decade.
17:27Eric Talley:And the Justice Department is following in step, wrapping up a criminal investigation into whether former government officials conspired to undermine Trump going back 10 years. The department is adding prosecutors to the investigation, convening a grand jury and sending out subpoenas to people like former CIA director John Brennan. Joining me is Bloomberg legal and national security reporter Chris Strom. Chris, tell us about this Justice Department investigation that's been referred to as the grand conspiracy investigation. Well, the investigation is an extremely broad probe into multiple actions that were taken at the end of the Obama administration and during the Biden administration, ranging from the investigation into Russia's interference in the 2016 election and whether the Trump campaign had any involvement in that, ranging all the way through to the investigation that was done under the Biden administration into Trump's activities, including his efforts to overturn the 2020 election and his taking of classified documents down to Mar-a-Lago after he left office.
18:45Eric Talley:I mean, it sounds like especially the allegations involving Russia have been investigated over and over again, including by John Durham, who was appointed by Trump, right? One of the things that's so bizarre about what the Justice Department is doing is that they're retreading ground that has already been well plowed by other investigations. There's been multiple investigations into what happened in 2016 with regard to the Trump-Russia investigation. There was an inspector general investigation into all of the activity that took place. And then there was a special counsel appointed during the first Trump administration, John Durham, and he took a deep dive look into whether there were any crimes committed during the Trump-Russia investigation.
19:33And he was only able to find one low-level FBI lawyer who lied on a document and that individual pled guilty. No other individuals were ever charged with any crimes based on the previous investigations. And so a lot of people are questioning now what the Justice Department is currently doing by going back 10 years and looking at activity that has already been well investigated without any findings of wrongdoing.
20:03Eric Talley:And they're seriously pursuing a theory that Democrats were involved in a conspiracy to sabotage Trump over the years. Part of the theory of the case that prosecutors are pursuing is that there was a conspiracy against Trump ranging over the last 10 years from the Trump-Russia investigation that was done in 2016 to the Mar-a-Lago classified documents investigation that was done in 2023. And prosecutors are trying to stitch together kind of a Frankenstein of a case that says that there is a grand conspiracy against Trump ranging over 10 years. I mean, there were pictures of boxes and boxes of classified documents piled up at Mar-a-Lago, so I'm not sure where the conspiracy would be there.
20:51Eric Talley:And investigations go awry all the time. What kind of charges could they bring against these former officials for pursuing investigations? What's happening here is that Trump has demanded that the Justice Department investigate and potentially prosecute his perceived political enemies. And some of the major figures that Trump wants to be investigated were people who were involved in the Trump-Russia investigation of 2016 and putting together an intelligence assessment during that time, as well as government officials who were involved in the investigation into Trump's retention of classified documents.
21:33And so the Justice Department during the second Trump administration has set out to conduct a sweeping investigation to look for any potential wrongdoing or criminal activity that was done over the last 10 years that they can find any potential crime where they could bring a charge. There's a lot of skepticism that the Justice Department is going to be able to find anything new, given that a lot is already known about these investigations. But they've convened a grand jury, and they've sent a bunch of prosecutors down to Florida, and they're looking under as many rocks as they possibly can, and bringing people in before the grand jury to testify with the hopes of finding something that they can pin to somebody who Trump once investigated.
22:32And as of now, there's no indication that they found any criminal wrongdoing or have any justification to bring charges against anybody. But the investigation is ongoing. They do have an active grand jury. They are taking testimony. They have been receiving documents and they've put a bunch of people under investigation and they are moving forward with an undefined scope of investigation that doesn't have any clear ending in sight.
23:05Eric Talley:Trump has a long enemies list. Are they targeting anyone in particular? Individuals that we know who are under investigation include John Brennan, the former CIA director, James Clapper, the former director of national intelligence, and other senior officials who were either in the Obama administration or the Biden administration and worked for either the FBI or intelligence agencies. It's pretty clear that Trump wants certain individuals who are well-known, such as John Brennan, James Clapper, and James Comey, to be under investigation and, ideally, from Trump's point of view, face criminal charges.
23:48But at this point, there's not been any indication that evidence exists to actually bring charges against any of these individuals. So what might happen is that prosecutors will eventually write up a report and talk about activity that they believe was not justified and was done in the spirit of trying to make Trump look bad. But in the end, they just issue a report without any criminal charges.
24:15Eric Talley:I mean, sometimes it seems like the point is the investigation itself, the news about the investigation and just bringing charges like the Comey charges over the seashells on the beach. Yeah, part of what the Justice Department seems to be doing at this point is making the prosecution the punishment that by prosecuting individuals and putting them under investigation, they have to spend a lot of money and they have to spend a lot of time. They have to hire lawyers. They have to go into court. They have to file documentation. And so part of what the Justice Department appears to be doing right now is putting people under investigation just for the sake of putting them under investigation as a punishment.
24:59Eric Talley:Has the investigation ramped up since Todd Blanche became attorney general? Yes. By all accounts, the investigation has entered a new phase. Previously, the investigation has been going in fits and starts. When the Trump administration first began, it was being done under former Attorney General Pam Bondi. It is based in the Southern District of Florida, and investigators were spending a lot of time cooking up the theories of the case and then started sending out subpoenas for documentation. And then the investigative pace seemed to stall. And of course, Bondi was removed in April, and Todd Blanche was confirmed as Attorney General in August.
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25:43And since then, we've seen an uptick in the activity. And the most significant thing is that prosecutors in Florida are now sending out subpoenas for individuals to come in and testify in person before the grand jury. And so this marks kind of a new and aggressive phase for the investigation.
26:01Eric Talley:And why is this huge investigation based in Florida? The reason why the Justice Department based the investigation in Florida has always been a mystery. There is plenty of activity that is under investigation that doesn't seem to have any connection to Florida. Obviously, the Mar-a-Lago documents case has a connection to Florida. And so prosecutors are making the case that they are able to base their investigation in Florida because they have activity that occurred in Florida that is connected to a 10-year grand conspiracy against Trump. But what really appears to be going on is that the Justice Department did not want to bring any of the case in any other jurisdiction where they might not have a favorable jury or they might not have a favorable judge.
26:49And in Florida, they based their grand jury in Fort Pierce. Fort Pierce just happens to be where Judge Eileen Cannon is located. And Judge Eileen Cannon oversaw the classified documents case against Trump. And she made a lot of rulings that were favorable to Trump and ultimately dismissed the case against Trump. And so it appears what the Justice Department is now trying to do is engineer a way to get any kind of charges that they bring in front of Judge Cannon.
27:21Eric Talley:And Judge Cannon was reversed twice by the 11th Circuit during that case. Now, in April, conservative lawyer and Trump ally Joe DiGenova was brought in to lead the investigation. Why did he resign suddenly? Joe DiGenova previously served in the Justice Department as the U.S. attorney for the District of Columbia back in the 1980s. And he's had kind of a storied reputation as being an experienced professional prosecutor and went into private practice. But in April, the Justice Department reached out to have him come in and lead the investigation based in Florida. And he had been working on it. But last week, he abruptly resigned.
28:06And there's a lot of questions over what actually took place behind the scenes. What we've been able to report is that he was very frustrated and mad at the heavy-handed approach that was coming out of Washington and the Justice Department leadership to dictate what the pace and scope of the investigation should be. And he was pushing back on how fast the Justice Department wanted to do grand jury activity and potentially bring charges against individuals like John Brennan and eventually reached a boiling point where he could not continue doing the investigation the way that he believed it should be done.
28:47And so he ended up resigning.
28:50Eric Talley:It says a lot when you have an experienced lawyer leaving an investigation after five months. And of course, the Justice Department so far has not fared well in its attempts to prosecute Trump's enemies. Thanks, Chris. That's Bloomberg's Chris Strom. Coming up next, how to fix the Supreme Court's shadow docket. I'm June Grosso and you're listening to Bloomberg. Some people treat ChatGPT like some kind of smart search engine and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work.
29:30Eric Talley:It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChachiPT.com by selecting Work Mode, available on Plus and Pro plans. If you listen to financial news, you know a lot of time is spent thinking about what's next. The next opportunity. The next investment. The next move. But sometimes what matters most is being ready for what you never saw coming.
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30:45Because planning for the future isn't only about knowing what's next, it's about making sure you're ready for what you can't predict. Let Cincinnati insurance make your bad day better. Find an independent agent at CINFIN.com.
31:00Eric Talley:This is Alexis Christophorus for Bloomberg Surveillance. AI is everywhere. Outcomes are not. Not because AI doesn't work, but because AI hasn't reached the workflows yet. The campaigns, the launches, the quarterly planning. Those workflows are still run by humans alone. AI is making individuals faster, but it's not making businesses more productive. That's the gap Asana is built to close. Asana is the operating system for human agent teams, your easy button for AI productivity across every team. Ready-to-go AI teammates pre-built for marketing, ops, and IT. No prompt engineering, no setup. They show up where the work is happening, already onboarded in your workflows, ready to deliver.
31:42Eric Talley:And the more they work with your team, the smarter they get. With Asana, your whole company can work on the same plan towards the same goal, whether you're a team of 10 or 10 ,000. Asana, where humans and agents workflow together. Try it at asana.com. That's A-S-A-N-A dot com. The Supreme Court's emergency or shadow docket has grown exponentially in size and importance, with rulings in consequential cases often issued without explanation, leaving lower courts to puzzle over their meaning. Justice Ketanji Brown-Jackson is just one of the justices who've criticized the shadow docket for its lack of transparency and accountability.
32:27Eric Talley:So the court has left confusion in its wake, and it offers little guidance because it ordinarily does not spell out the circumstances, giving rise to its own equities evaluation, making it incredibly difficult for lower courts to understand which facts were important to the state determination and thus identify like cases. Joining me is Columbia Law School professor Thomas Schmidt, who's written a paper along with his colleague, Professor Kellen Funk, suggesting some fixes for the emergency docket. Before we get to the fixes, can you explain why the shadow docket has ballooned both in size and significance?
33:12Well, it's a difficult question. And let me just begin with some numbers, June, just to remind everybody how dramatically this has grown in the last decade or so. So during the eight years of the Obama administration, plus the eight years of the Bush administrations, the court got six or eight applications from the government to intervene and lift a lower court's injunction with respect to a federal policy. That has exploded in recent years. So the latest number that I saw was about 37 applications from the second Trump administration in the first, what, year and a half, almost two years of the administration.
33:47So there's just been a dramatic increase. And I think that's due to a number of different reasons. I think one is that the executive branch and the president in particular has gotten a little bit more aggressive over time in invoking legal authorities to implement its preferred policies without Congress. And that's led to some litigation that has created a series of injunctions in lower courts. And the Supreme Court itself has felt pressure to intervene and has intervened in a lot of cases. So that's one piece of the story. But I think another piece of the story, unquestionably, is that the court has been more open to these sorts of applications, and it's applied its own stay and injunction standards in a way that invite these applications.
34:30So to a certain extent, litigants are pushing on an open door, and that's another reason that there's been so much of a growth in this side of the court's business.
34:38Eric Talley:There's a four-part test for equitable intervention that courts use. Does the Supreme Court take into account and decide on each of those four factors? So the four-factor test that the court has given is irreparable harm, the likelihood of success on the merits, the balance of the equities, and the public interest. Now, it's a little bit difficult to answer your question for a couple reasons, right? So first of all, so often these rulings on what we call the equity docket are unexplained. So when a ruling is unexplained, there's just no way to assess which of the factors the court considered. Second, sometimes when they are explained, they only focus in on one factor and don't really address the other factors.
35:21So again, it's not really clear in that circumstance what was an ingredient in the court's decision-making. And then in other cases, the court kind of recites the factors in a rote sort of way, but doesn't really address all of them. So one thing that Kellan, Professor Funk, and I argue for in this paper is a little bit more transparency in the rationale for rulings and just a little bit more attention to the traditional balance of the equities.
35:45Eric Talley:Is that why you think a better name for the emergency docket would be the equity docket? I think it's better because that fundamentally describes what the court is doing, right? I mean, what litigants are doing when they come to the court in this posture is asking the court to set the status of a legal policy or to set the status between the parties while a lawsuit is pending. And traditionally, historically, that was one of the core functions of courts of equity. As you mentioned, the Trump administration's emergency applications to the Supreme Court have dwarfed that of any prior administration.
36:20Eric Talley:And their claims of an emergency cover everything from firing someone to changing birthright citizenship. So should the court draw a line in the sand somewhere and say, this isn't a real emergency? Yeah, I think there's a lot to that, June. And I would think about it in a couple different ways. First of all, one of the most important requirements for getting on the equity docket and historically to get into a court of equity was that you had to show irreparable harm. And the reason you had to show irreparable harm is that the courts of law, in the case of the Supreme Court, right, the merits docket, are open for adjudication of the case in this non-expedited posture, right?
36:59So one way that the court could respond to this circumstance is to just insist on government showing of irreparable harm in every case when they come to the court. And I think the pattern so far is that the court has been taking the administration at its word when it claims harm. And the result has been that the door to the equity docket has swung open. So I think one way to deal with this problem is for the court to insist in a more granular factual sense on what exactly the emergency is and why the government is going to suffer irreparable harm. But the second part of my answer to your question, June, is that you're right that not all of these cases present genuine emergencies.
37:38A petition from non-citizens hours before deportation would be an obvious case, right? If you think about the AARP case, for example, that's an emergency. Other cases, it's much less clear that these are emergencies, right? If you think about the Lisa Cook case, that was technically resolved on the equity docket, right? The court never granted certiorari in the case, but it was pending for several months. It was pending at least as long as the typical merits case, right? So in that circumstance, we think there's no danger in slowing down a little bit and issuing an opinion that explains kind of point by point why the equitable standard is met.
38:14Eric Talley:Another favorite Trump administration argument that I've noticed on the shadow docket is an invocation of national security as a justification for its actions. Does the Supreme Court almost always bow to the administration when it says national security? There's no question that historically courts have been reluctant to involve themselves in cases where the executive branch is making strong claims of national security. On the other hand, the court has said again and again that the invocation of national security is not a talisman, right? It doesn't ward off judicial reviews sort of automatically.
38:52And I think the broader pattern of litigation in the Trump administration, not just in the Supreme Court, but in the lower courts, is a certain amount of skepticism to claims that the Justice Department is making, right? This is sometimes couched in terms of the erosion of the presumption of regularity. The idea being we can't necessarily take the Justice Department at its word and all of the claims that it makes in its various briefs. So I think the Trump administration is trying to tap into a history or a tradition of judicial reticence, but I'm not sure that it's always working.
39:26Eric Talley:Justice Jackson talked about the difficulty for lower courts to follow the Supreme Court's orders on the emergency docket. And there was that case last year where Justice Gorsuch took a federal judge to task for not following Supreme Court precedent. Is there any wiggle room for lower courts? So last year, in a case called Boyle, the Supreme Court made clear that when it rules on the emergency docket, the lower court should follow it in like cases. That is to say, by ruling on the emergency docket or the equity docket, the court has shown how it regards the equities in the case to balance out, and lower courts should follow that lead.
40:08Now, having said that, following the Supreme Court is perhaps easier said than done, right? To the extent many of these orders are unreasoned. It's not clear what the basis was and therefore not clear exactly what it is that a lower court has to follow. The second thing is that often the court's rulings on the equity docket are foreshadowing changes in the law that make it very difficult for a lower court to understand what the law is right now. So one thing is the old equitable maxim that equity follows the law. And when the court takes a case on the equity docket, it should be applying existing law, not anticipating a change in law that might happen down the road.
40:49To make this a little less abstract, maybe I'll mention the slaughter case in which the Supreme Court overturned Humphrey's executor and the principle of independent agencies that have been embodied in that case. Now, if you're a lower court judge before slaughter, on the one hand, you're looking at a unanimous majority opinion in Humphrey's executor upholding the FTC. On the other hand, you're looking at a mostly unreasoned order by the Supreme Court just relying on harm to the executive branch while purporting not to disturb Humphrey's executor that allowed the Trump administration to move forward with firing a commissioner of the FTC.
41:24It's not clear to me that looking at that, it's plain what the duty of a lower court judge is.
41:29Eric Talley:Do you think some of the justices may be reluctant at times to rightful decisions because it slows down the process. They have to exchange decisions and perhaps there'll be concurrences and dissents to write? I think that's quite possible. And whether to write an opinion and how long an opinion to issue, those are inevitably sort of prudential judgments that are going to be happening within the court. But I don't necessarily think that issuing opinions slows things down. And the most important reason is that the court does not necessarily have to issue a full-fledged opinion at the moment that it rules, right?
42:06So for example, an individual justice alone can issue an administrative stay while an opinion is being worked out, right? So that would preserve the status quo or allow the court at least to set the status quo while it's issuing an opinion. It can also issue an order as a majority and then issue an opinion afterwards. I mentioned the AARP case a moment ago. That's exactly what happened there. A very brief order on the night that the non-citizens first approached the court about their imminent deportation, and then a much longer opinion a few days later.
42:37Eric Talley:Speaking about preserving the status quo, or rather not preserving the status quo, let's turn to the White House ballroom, where the majority went off on standing and twisted itself in knots to come to the conclusion that the National Trust for Historic Preservation didn't have standing. So they allowed President Trump to go forward to complete the project that lower courts concluded was likely illegal. What happened to preserving the status quo while litigation proceeds? I agree with you, June, and I think the equity docket idea is a helpful way to think this through, right? So one thing that courts of equity would do is to preserve the status quo while litigation is pending to enable a court to rule on the merits of a case.
43:26And as you point out here, it is very possible that by the time a plaintiff withstanding under the court's new opinion comes along and is able to sue, the ballroom will be built and there will in fact be no way to adjudicate the merits of the case because it will be too late. So one way to think about this in equitable terms is just to say, this looks illegal under the relevant authorities for the reasons that Chief Justice Robert gave in his dissent. I have not seen a plausible legal justification for moving ahead with this without other kinds of approvals. And essentially, what the administration was doing in coming to the Supreme Court was asking for its equitable intervention to allow it to get away with in a legal project.
44:09And that's a fundamentally inequitable use of a court of equity. The way you could put that in more legal or litigation terms would be to say the administration came to the court with unclean hands. Or you might say that he who seeks equity must do equity. And essentially enlisting the Supreme Court in this circumstance, I think, violated those equitable maxims.
44:30Eric Talley:I always feel that the doctrine of unclean hands presents a vivid image of that equitable defense. Thanks for sharing your insights with us. That's Columbia Law School Professor Thomas Schmidt.
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From the publisher
June Grasso talks to Chris Strohm of Bloomberg News, and Professors Eric Talley and Thomas Schmidt of Columbia Law School, about the top legal stories of the week.
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