Ep 264 — Mission Accomplished-ish

Law and Chaos

This episode of Law and Chaos covers major developments in U.S. law and politics, including the Federal Reserve's rate hike under Trump's fr

Key takeaways

• The Supreme Court's clear stance against election interference is being ignored by the Eighth Circuit, signaling a dangerous erosion of judicial norms.
• Federal judges across political lines are united in defending court order sanctity amid unprecedented DOJ pressure during Operation Metro.

Main topics

• Federal Reserve rate hike and Trump's reaction
• Judicial independence under the Trump administration

Notable quotes

"If you don't have it, you have either anarchy or you have authoritarianism. You have Russia or you have China or you have North Korea." – Judge Schultz

Conclusion

The episode underscores a deepening crisis in judicial independence an

Transcript preview

Speaker 1 (0:00) I kind of want to see what happens here. The Supreme Court has said so clearly, like, stop screwing with the elections right now. And the 8th Circuit's like, oh, you mean screw with the elections? Got it. And I kind of like, why don't you try it? Right. The Fifth Circuit, as you said, is completely batshit and holds the record, even with this incredibly conservative court. Speaker 1 (0:35) Welcome to Law and Chaos, where the Comey case has landed at the Fourth Circuit, the Kennedy Center is still standing, and the government is sticking it to Google, kind of. We've got a lot to cover, so let's get after it. Speaker 1 (0:52) Happy Friday, Chaos Monkeys. I'm Liz Dye, and with me as always is Andrew Torres. Andrew, how are you? Speaker 5 (0:58) I am great, Liz. The neighborhood pool is having a little picnic by the tarp, beer garden by the tarp, I think they're calling it. You bring the chair and hang out, and I am very, very excited for that Speaker 1 (1:12) one. Speaker 5 (1:12) Will there be Speaker 1 (1:12) cribbage, though? Speaker 5 (1:13) I don't know. I mean, if I have something to say about it, there will be. How are you doing? Speaker 1 (1:18) I am doing fine. I am doing fine. This is Jewish holidays. We will obviously not be here on Monday. So we will not be here Monday with written content, Tuesday with another show, because I will be fasting and cranky. So we have ever so many stories for you today. As per usual, nothing in the Trump administration is normal or what it seems. But before we get to all of that, Speaker 6 (1:42) Ducket Alerts. Speaker 1 (1:45) Let us begin with a hearty congratulations, a mazel tov, as it were, to Fed Chair Kevin Warsh, who, along with every other member of the Fed's Open Markets Committee, voted to raise interest rates yesterday. And from his public comments, we may surmise that a couple more rate hikes are in the offing. Speaker 5 (2:01) Jerome Powell could not be reached for comment, but sources suggest he is closeted in his office laughing his ass off. Speaker 1 (2:08) Yeah. So Trump spent a year harassing Jerome Powell and trying to force him out so he could get his own. guy in on the theory that Kevin Warsh would cut rates and turn the money spigot on and everything would be hunky dory. And he deserved zero percent interest because that's what Obama got. Trump even sick Janine Pirro and her goons from the U.S. attorney's office in D.C. on Jerome Powell, whom Trump himself appointed. And Trump is still trying to harass Fed Board of Governors member Lisa Cook out of her job. And yet interest rates. Anyway. Yeah, Speaker 5 (2:43) Trump is very mad about it. Today, he posted on social media, interest rates in the United States should be 1 % or less because we are the best credit in the world by far. If we stop trading with every country that we have a deficit with, which is most of them, we would make at least $1.5 trillion a year. Lower the interest rates for the United States of America and fast. Washed. Gas. Low energy. Well, lucky for Trump, consumer sentiment never has an effect on the midterm elections. Is Speaker 1 (3:17) that how Speaker 5 (3:17) it goes? Yeah. Okay. Next up, the New York Times has a blockbuster piece speaking to district court judges and their staff about what it was like to be under siege during Operation Metro's surge in Minnesota. That was the Department of Homeland Security's assault on the city this past winter. Speaker 1 (3:35) Yeah. We talk all of the time about the administration making war on the judiciary. And obviously, we're not minimizing the effect of this metro surge on regular people. But as we said on Monday, the Trump Justice Department is permanently damaging the relationship between prosecutors and judges. The fact that you have six of the seven judges who are on active duty at the time of this dragnet speaking to the paper, three of them, you know, giving quotes being recorded, that is a sign that something is very, very wrong. Speaker 5 (4:05) Yeah. And it is not just district court judges. The article quotes J. Harvey Wilkinson, the chief judge of the Fourth Circuit. Wilkinson said, if there is one single issue that would unite judges of all persuasions, it is the sanctity of court orders. There is a brotherhood of judges on this question, of which Judge Schultz is an esteemed and valued part. Yeah. Speaker 1 (4:26) Judge Schultz was the chief judge in the District of Minnesota when this... all went down. And Speaker 5 (4:32) one of the ones willing to speak on the record. Yeah, Speaker 1 (4:34) he was the focus of this article. I read Judge Wilkinson's quote as a bit of shade at the 8th Circuit. Remember, Judge Wilkinson is in the 4th Circuit. And the 8th Circuit judges really did not have the trial judges back in Minnesota, right? The 8th Circuit is one of only two circuits that ruled that Trump's mandatory detention policy was actually legal. Speaker 5 (4:55) Yeah, I share that reading. The article talks about how this deluge of more than 1,100 habeas cases in response to that mandatory, that wildly, obviously illegal mandatory detention policy pretty much broke. the courthouse in Minneapolis. The clerk's office was working 16 hours a day, seven days a week, just to keep up with the filings. Judges were leaving their phones on all night long because they knew that if they did not respond immediately, people would be spirited out of the state without their documents and then be beyond the jurisdiction of the court for habeas petitions. They have to be filed in the jurisdiction in which you are being currently detained. During that same chaotic moment, the magistrate judge denied the warrant for journalist Don Lemon's devices after the city's church incident. Right. He was filming that protest. And U.S. Attorney Daniel Rosen went apeshit and demanded that the Eighth Circuit intervene, which it, to its very minimal credit, at least refused to do. Then, Harvey Dillon... The head of the DOJ's Civil Rights Division went on Megyn Kelly's podcast and attacked the magistrate judge and his wife by name. The family had to go into hiding for a week. Speaker 1 (6:08) Yeah, these judges so clearly loathe Rosen. And they very clearly think that the Trump DOJ is a danger to the rule of law, a threat to the rule of law. I Speaker 5 (6:18) think that is right. And we should add for the listeners, Judge Schiltz, like... Judge Wilkinson, whom I know fairly well from the Fourth Circuit, they are both extremely conservative guys, right? But they're not MAGA, right? So Judge Schultz said in this interview, you walk down the street and you assume you're generally safe because of the law. It's the rule of law. If you don't have it, you have either anarchy or you have authoritarianism. You have Russia or you have China. or you have North Korea. Speaker 1 (6:49) I mean, that's a massive distress signal for democracy. Okay, next up, in another sign of how corrupt the Justice Department has become, the antitrust division just big-footed into the case against Paramount, seeking to block the merger with Warner Brothers. Not in support of the state plaintiffs in this case, because remember, that's a whole bunch of states, and they argue that this merger will inevitably limit choice and raise costs for consumers. No, the government's not supporting that. No, the DOJ is busting in like the Kool-Aid man to tell Judge Araceli Martinez-Oguin that she should make the states fork over a $1.9 billion bond during the pendency of this litigation. Speaker 5 (7:30) We're going to. talk more about antitrust. That is, as far as I can tell, unprecedented in the history of antitrust law. We discussed this case back in episode 247 in detail, but basically, as part of its offer to its shareholders, Paramount agreed to this $650 million, it's called a ticking fee, for every fiscal quarter that the merger doesn't close. That starts in September. Plus, they've agreed to fork over a $7 billion fee if regulators kill the deal. And Paramount's debt just got downgraded to junk status. So this lawsuit has the potential to cost them a ton of money, even if they win, because trial isn't scheduled until March of 2021. That is already $1.3 billion in ticking fees alone, although I am given to understand that they are in settlement talks right now. Speaker 1 (8:21) Yeah. So, OK, the backstory here is that on July 24th, when it was clear that Judge Martinez O'Gawain was going to issue a preliminary injunction blocking the merger, the parties jointly stipulated that defendants will not take any steps directly or indirectly to integrate or consolidate their operations pursuant to the transaction until the earlier of one. five days after the merits determination in these matters, or two, June 1, 2027. So that was the agreement of the parties entered into voluntarily by Paramount. It was not an injunction. Speaker 5 (8:56) No. But then a month later. Paramount said in a filing, oops, we meant that we actually wanted the state to post a $1.88 billion bond because we think this is the same as an injunction. So stick it to them, judge. They calculate that they're owed $1.69 billion in ticking fees. That is roughly about $7 million a day from October 1st, 2026 to June 1st, 2027. Plus. $190 million in incremental financing costs arising out of the delay. Speaker 1 (9:28) This is so bizarre. Paramount stipulated to this deal without reservation, and now they want Speaker 5 (9:35) security? That is more or less what the state plaintiffs said. They were like, you chose to sign the ticking agreement. And let's be clear, the reason you offer that concession in negotiations is to make your bid more attractive. Here, they wanted to beat out Netflix, right? And Paramount chose to sign that stipulation without bond in order to avoid expedited discovery in court and all of that. the, I'm sure, nasty findings of fact that the judge was going to make when she issued that preliminary injunction that we all knew was coming. Right. And so you reap the benefit of those things. And now you want the states to pay for it? Speaker 1 (10:14) Yeah. That's been one of the Trump administration's consistent positions, though. They've tried like hell to force plaintiffs in every case who are seeking to vindicate their rights to post these crippling bots as a disincentive to asserting. clear constitutional rights. And courts have universally told them to piss up a rope, right? They're not just denying this. They're saying, fine, you want a bond? I'll give you a dollar or I'll give you $100, right? And it's funny because a lot of these states, like you generally don't make the state post a bond and the states don't even like know how to post a bond. And they're like, well, will you take cash? Like they don't know how to do it. Anyway, but the point of these tiny bonds. Is judges going out of their way to say, OK, this is what I think of your request, you assholes? Speaker 5 (11:01) Yeah, this is like leaving a nickel as a tip on the table, right? I should add, another consistent Trump administration position has been whatever Paramount's MAGA owner Larry Ellison wants that Larry Ellison gets. So it stands to reason that the DOJ is jumping in here and saying, Judge, you should definitely make these states pay the $1.9 billion in security. We know why that's happening. To be clear, this is not going to work, but it certainly is on brand for the Trump DOJ. Speaker 1 (11:33) Absolutely. Speaker 5 (11:34) Okay, Liz, now it is time for our Law and Chaos Doofus of the Day! You Speaker 1 (11:39) doofus! Speaker 5 (11:42) And since you let me pick, I, of course, cheated and have selected the three-judge panel coming out of the Eighth Circuit, a.k.a. the Teemu Fifth Circuit that we just talked about. The Eighth Circuit has all the crazy conservative activism as their more famous cousin, but none of the brand recognition. I Speaker 1 (11:58) mean, I don't think they're quite as bad. They're less, like, you know, anti-choice. They're not as bad. Far be it for me to defend them, but... Speaker 5 (12:08) Yes. Yeah, well, the Teabook comparison is out there. So, OK, this panel is James Loken, an 86-year-old George H.W. Bush appointee who really ought to know better by now. And two Donald Trump appointees, David Strass, who has shown up on the show before, and Justin Smith. Speaker 1 (12:26) Smith was one of Trump's personal lawyers in a bunch of the pre-election litigation, including working on the E. Jean Carroll cases. He got rewarded for losing. big time with this lifetime appointment to the federal bench. The ABA grudgingly rated him as qualified, which is kind of like getting a mostly meets expectations grade during your annual performance review. That was before the Trump administration decided that they were not going to let ABA vet any more judicial nominees because they didn't like being told that these people were incompetent. At any rate, during his confirmation hearing, Smith refused to answer the question whether Joe Biden was legally. The president of the United States has pretty much standard operating procedure for Trump nominees. Speaker 5 (13:06) Yeah. So a lot of low cards in that hand. But for this particular segment, we are revisiting Under v. Missouri. That is the federal court litigation that was cooked up by Missouri's Secretary of State Denny Hoskins to try and evade his own state's Supreme Court. The state Supreme Court had instructed him to use the 2022 congressional maps, which are... massively gerrymandered to favor Republicans, but only favor Republicans 6-2 instead of one cooked up in 2025 that squeezes out one more Republican seat. But instead of doing what the state Supreme Court told him to do, Hoskins instead conspired. He recruited this friendly Republican congressman, Bob Onder, and had Onder bring this sham lawsuit ostensibly against the state of Missouri in federal court seeking an injunction. And he... Actually got one for reasons we explained in that episode. But as we told you in episode 262, that injunction was stayed by the U.S. Supreme Court with zero dissents. And at the same time, the state Supreme Court convened an emergency hearing and held Hoskins in contempt for trying that shit. Case Speaker 1 (14:15) closed. Or not. Because technically, Anders' federal lawsuit is still pending. And so the day after Hoskins got whacked by... both the state Supreme Court and the U.S. Supreme Court, Anders noted his appeal to the Eighth Circuit. And what the Eighth Circuit should have done was say, look, the Supreme Court just told the whole world twice, because, by the way, they had to weigh in twice, that Missouri could not use the 2025 map. So like. What are you doing here? Go home. It's too late. And in practical terms, that would have meant vacating the appeal and sending the case back down to the trial court for further proceedings consistent with the Supreme Court's rulings. But that's not what the panel did. Instead, they kept the appeal. They ordered this like ridiculously expedited briefing and they scheduled oral argument all within four days. And at that oral argument, which took place this morning, Judge Loken. He suggested that this was what the Supreme Court wanted to happen. He said, it's on our plate. And I think the Supreme Court has said, get to it. So here we are. They told us, get to work. Given the election year pressures and confusion and need for voters and everyone