Judge Arthur F. Engoron presided over New York's civil fraud trial against Donald Trump, two of his children, two of his associates, his trust, and nine companies that he controls. On February 16 Judge Engoron handed down his final ruling on February 16. In 92 pages he held Mr. Trump and various entities liable for $355 million plus interest, found his sons Eric Trump and Donald Trump, Jr. liable for $4 million each, and barred Mr. Trump, his accountant Allen Weisselberg, and Jeffrey McConney (formerly the Controller at the Trump Organization) from serving as an officer or director of any New York entity for three years.
Political aficionados with a thirst for blood can be excused for skipping to the last two pages, where the judge laid out the penalties he was imposing, in the manner of the impatient reader of a mystery novel who reads only up to the crime itself and then jumps to the detective's solution, skipping over the 200 pages of investigation in the middle. The casual reader who skips over Judge Engoron's 6 pages that recite the history of the case, the 67 pages discussing the facts, and the 17 pages of legal conclusions has missed a great deal. Herewith Isaac's take on what Judge Engoron said.
First, Judge Engoron explained why New York cares about financial fraud. "New York State, particularly New York City, is the financial capital of the country and one of the financial capitals of the world." (Page 3.) "The common excuse that 'everybody does it' is all the more reason to strive for honesty and transparency and to be vigilant in enforcing the rules. Here, despite the false financial statements, it is undisputed that defendants have made all required payments on time; the next group of lenders to receive bogus statements might not be so lucky. New York means business in combating financial fraud." (Page 4.)
Before he dug into the testimony, Judge Engoron threw a dash of shade at Mr. Trump's lead lawyers, Christopher Kise and Alina Habba, stating (correctly) that as the state sought only equitable relief in the form of injunctions and disgorgement of fraudulent profits, the defendants were not entitled to a jury. The shade came in the form of a footnote on page 6, "In any event, neither party applied nor moved for a jury trial."
Then the judge described the testimony of the 14 non-party witnesses (mostly bankers and outside accountants), the five individual defendants, the eight other witnesses from the Trump Organization, the state's expert, and the 13 expert witnesses that the defendant called. What's important in his descriptions of the testimony of the witnesses is not what they testified to, but the judge's evaluation of their credibility. (Isaac will explain why this is important later on.)
Judge Engoron did not comment on the credibility of the 14 non-party witnesses. He began his saltiness with four of the five individual defendants. In the judge's view, Jeffrey McConney's credibility was "severely impaired" (page 25), then "further compromised" (also page 25), and then further strained when he could not recall if his separation agreement prohibited him from voluntarily cooperating with governmental investigations of the Trump Organization, which lapse the court found "implausible" (page 26). Allen Weisselberg came in for more direct treatment: his separation agreement bars him from cooperating with the government, which "renders his testimony highly unreliable. The Trump Organization keeps Weisselberg on a short leash, and it shows." (page 26.) The judge turned to Eric Trump, whose "credibility was severely damaged when he repeatedly denied knowing that his father ever even compiled a [statement of financial condition] that valued his assets and showed his net worth 'until this case came into fruition.'" (Page 32.) And the court kept firing salvos in his direction: "When the documentary evidence against him became overwhelming, Eric Trump reversed his previous testimony." (Page 32.) "Eric Trump's testimony [about appraisals] was shown to be false when he was confronted with the ample contemporaneous documentary evidence demonstrating otherwise." (Page 33.)
And then there was Donald Trump himself, whom Judge Engoron deflated in a footnote. On page 36, the judge wrote, "Nonetheless, Donald Trump insisted that he believed Mar-a-Lago is worth 'between a billion and a billion five' today, which would require not only valuing it as a private residence, which the deed prohibits, (footnote 19), but as more than the most expensive private residence listed in the country by approximately 400%." Footnote 19 reads, "A fact of which he is well aware, having signed the deed himself." He concluded with this politely damning description of the former president's time on the stand: "Overall, Donald Trump rarely responded to the questions asked, and he frequently interjected long, irrelevant speeches on issues far beyond the scope of the trial. His refusal to answer the questions directly, or in some cases, at all, severely compromised his credibility." (Page 37.)
Yet it was not the Trump family but its hired experts that drew the sharpest of the judge's stiletti. One expert witness, Steven Witkoff, "conceded that he is neither an appraiser nor an accounting expert, nor is he familiar with what 'estimated current value' is under GAAP." (Page 48.) Of Steven Laposa, whom the defense offered as an expert witness on real estate research, the court observed that he had "formed no opinion as to whether any of the valuations at issue in this case were accurate, and, prior to this assignment, he had no experience preparing or reviewing personal financial statements." (Page 50.) The next expert witness earned a more severe burn from the judge. He was Gary Giuletti, offered as an expert in surety underwriting and surety brokering. He testified that he has known Donald Trump for about 25 years, plays golf and eats lunch with him, and is a member of "a bunch of his clubs." He's also the Trump Organization's insurance broker. (Page 51.) The judge's evaluation: "In its over 20 years on the bench, this Court has never encountered an expert witness who not only was a close personal friend of a party, but also had a personal financial interest in the outcome of the case for which he is being offered as an expert." (Page 51.) In 2022, Mr. Giuletti's firm earned $1.2 million in commissions from insurance that he handled for the Trump Organization.
Mr. Giuletti got off easier than Robert Unell, whom the Trump Organization offered as an expert in commercial real estate finance and banking. The court summarily disposed of his work: "On the whole, the Court was unable to ascribe any reliability to Unell's 'expert' opinions, finding them unresearched, unsupported, inconsistent, and contradicted by ample other documentary and testimonial evidence." (Page 56.)
Why are the trial judge's conclusions on credibility important? Judge Engoron undoubtedly knew that Mr. Trump and the other defendants, except possibly Allen Weisselberg, would appeal his final decision. It's a principle of appellate law that the appellate court will usually defer to the trial judge's assessment of the credibility of the witnesses. The trial judge sees and hears the witnesses and their demeanor; the appellate judges read their words from a transcript and only rarely will watch or listen to the testimony. Judge Engoron underscored this point on page 6: "Witnesses testified from the witness stand, approximately a yard from the Court, who was thus able to observe expressions, demeanor, and body language." My sense is that he's emphasizing to the appellate court that most of the Trump Organization's principal witnesses, including Donald Trump, Eric Trump, and Ivanka Trump, were simply not credible.
As with a good detective story, the description of the crime is at the beginning and the resolution is at the end. In the case of Judge Engoron's decision, the good stuff is the part in the middle.
Today marks 20 years since I published my first blog post. The Laquedem Plan to Improve My Small Corner of the Universe for the next 20 years is to write and publish more often, particularly in the Venn diagram overlap between analysis and amusement.
That's as good an explanation as any for why Facebook and its related platforms crashed this morning, locking out millions of users. Here's a flashback to Facebook's automated apology from an outage nine years ago.
As we often forget, Facebook's customers are its advertisers. Viewers like you and me are not Facebook's customers, but Facebook's product; it's access to our eyeballs that Facebook sells to its customers. With that in mind, Facebook's apology to users for its malfunction is akin to a slaughterhouse apologizing to the waiting cattle for having to wait because Production Line 2 is temporarily out of service.
From John Adams's term until late in the era of Franklin Roosevelt, elected presidents were inaugurated on March 4. Today is the 175th anniversary of the inauguration of Zachary Taylor, who took office on March 4, 1849 and served until his death from cholera on July 9, 1850.
But was it cholera that killed President Taylor? Some ascribed his death to contaminated milk that he drank at a celebration of Independence Day that took place at the Washington Monument, which (unlike Zachary Taylor) was more than five days away from being finished. Stephen Vincent Benet rendered Taylor's career into light verse:
Zachary Taylor was gallant and gruff,
A general rugged and heady,
He fought like a trump in the Mexican war
And his troops called him "Old Rough and Ready."
For he didn't much mind if their buttons weren't shined
As long as no man was a quailer
And the Mexicans found that their best bit the ground
When faced by old Zachary Taylor.
Zachary Taylor was President T.
One very warm day in July,
When he called for a bowl of ripe cherries and milk,
With a greedy old gleam in his eye,
Now cherries and milk on a very hot day
Make even the strongest turn paler,
And they proved more effective than Mexican shot,
For they finished off Zachary Taylor.
Kevin McCarthy's nearly nine months in office (a full term in other contexts) deserves a ballad to commemorate his service. Isaac has written one.
Lament for Kevin McCarthy
(to the tune of “Whatever Became of Hubert?” by Tom Lehrer)
Words by Isaac Laquedem (2023)
Whatever became of Kevin?
Does anyone even know?
Once he mastered the floor, then they showed him the door
When four of his core voted “no.”
It required fifteen rounds to elect him
And only one vote to eject him.
Watch Gaetz and his pals playing games
As the GOP throws out more names
We must amend the rules, ex-Speaker
Says each Fox News reporter
Your successor’s going to be even weaker
And serve a term even shorter.
Whatever became of you, Kevin?
Do you miss being at the top?
Can you keep a straight face
When erased from your place
While you wait for Matt Gaetz
To flop?
Does McConnell look down from the Senate with glee
And gloat to his friends that “it’s NMFP”?
Do you wonder what Nancy would do?
Kevin, what happened to you?
At the instigation of Representative Matt Gaetz of Florida, a small group of revanchist republicans combined with the House Democrats to remove Kevin McCarthy from his post as Speaker of the House in revenge for his having worked with the Democrats last week to extend funding for the government and avoid a weekend shutdown. The revanchists have no plan to replace Mr. McCarthy and appear to have believed that their Democratic colleagues would stand behind Mr. McCarthy and vote to keep him in office.
Their plan has both succeeded and failed spectacularly. Their plan succeeded in that they won the vote and demoted Mr. McCarthy to the rank and file. Their plan failed in that they have shown the nation that they have no plan, no agenda, and no goal other than to throw a spanner in the works, as the British say.
That delightful British phrase reminds Isaac of another odd British phrase, this one from the Parliamentary sphere, which points to how the republican leadership should respond to Mr. Gaetz and his cohort if they wish their party to again be taken seriously by the public. Each party in Parliament appoints a number of its members, called "whips," to communicate the leadership's wishes to the members and to instruct them on how to vote on matters important to the party. The title "whip" derives from fox hunting; the Oxford English Dictionary defines "whipper-in" as an assistant to a huntsman "who keeps the hounds from straying by driving them back with the whip into the main body of the pack." The Parliamentary whips similarly keep the backbench members from straying by driving them back into the main body of the pack, the word "whip" having morphed from meaning the instrument itself into meaning the person who wields it. A party can discipline a recalcitrant or obstructive member by "withdrawing the whip," effectively expelling the member from the party until the leadership decides to "restore the whip."
It's past time for the House republican leadership to do the American equivalent of withdrawing the whip from Mr. Gaetz. Remove him from all committees, expel him from the caucus, withdraw all funding . . . and if he does not reform, recruit and fund a candidate to oppose him in next year's primary. The others will fall in line rather than be pushed overboard to join him in Congressional limbo.
Donald Trump will go to trial on March 4, 2024 in federal court in the District of Columbia on the charges related to his attempts to overturn the 2020 election result. Why March 4? It's a Monday, and long trials often start on Mondays. But Judge Tanya Chutkan, who chose the date, may have intended to make a sly historical reference. Elected presidents are inaugurated on January 20 now, but before 1937 they were inaugurated on March 4. March 4 is thus the anniversary of the inauguration of all the elected presidents from John Adams to Franklin Roosevelt in his first term (1933). It was on March 4, 1889 that Benjamin Harrison (5'6", 160 pounds) was inaugurated. Harrison's "spectacularly corrupt administration" (the words of historian Heather Cox Richardson) produced a collapse of the stock market and the Panic of 1893.
Celebrations of Benjamin Harrison are few and far between. Judge Chutkan has figured out an appropriate commemoration, and Mr. Trump will get to play the leading part.
The 41-count indictment that a Fulton County grand jury handed down today is riveting in its narrative and notable in its detail. Isaac has read it with great interest. The grand jury’s accusations are not vague in time and place, nor are they more vague than necessary in describing the witnesses to the 161 numbered acts in furtherance of the election plot. Those in Mr. Trump’s inner circle who are yet uncharged will read the indictment attentively to determine which of their friends are “Unindicted Conspirator One,” “Unindicted Conspirator Two,” and the other eighteen or so of the unnamed additional conspirators.
All 19 defendants were charged with violating the Georgia Racketeer Influenced and Corrupt Organizations (“RICO”) Act. This charge is particularly ironic, or perhaps poetically just, when applied to Rudolph Giuliani, as he came to fame in the 1980s for using the federal RICO Act to dismantle the core of the New York mafia; as a federal prosecutor he obtained indictments against a long list of the mob’s leaders and lieutenants, convicting most of them.
The indictment has some Easter eggs within its bulk. I’ve alluded to one, which is the game of guessing the identities of the unindicted conspirators. Another is to examine who got indicted with whom.
The indictment has 41 counts and names 19 defendants. Every defendant was charged with violating the Georgia RICO Act. No defendant, however, was charged with violating even half of the 41 counts, and no count except the RICO charge names more than 7 defendants. Messrs. Trump and Giuliani lead the pack with 13 charges each, sharing in 7 of them. The runner-up in the indictment list is more obscure; he is Ray Stallings Smith III, a lawyer at a small firm in Atlanta whose practice includes election law. He faces 12 charges, including all 7 of the charges that name both Mr. Trump and Mr. Giuliani.
At the other end of the spectrum lie Jenna Ellis, Jeffrey Clark, and Mark Meadows, who face only one charge each in addition to the all-hands-on-deck RICO charge (Count 1). Ms. Smith’s [thank you, Kari Chisholm, for catching the error] Ellis's charge (Count 2), which she shares with attorneys Giuliani, Eastman, and Smith, is that she participated in inveigling members of the Georgia Senate to appoint impostor electors. Mr. Clark’s charge (Count 22), which he faces alone, is that he criminally attempted to knowingly make the false statement that the Justice Department had ”identified significant concerns that may have impacted the outcome of the election in multiple States, including the State of Georgia,” asking for permission from acting attorney general Jeffrey Rosen and acting deputy attorney general Richard Donoghue to send that message to Georgia’s governor, speaker of the house, and president of the senate. Count 28 names only Mr. Trump and Mark Meadows and charges them with having unlawfully “solicited, requested, and importuned” Brad Raffensperger, the Georgia secretary of state, to unlawfully alter the certified vote.
So who did get indicted with whom? (It sounds rather like high school gossip.) Three of Georgia’s fake electors are among the indicted. They are the only ones charged with Counts 8, 10, 12, and 14. Two of them are the only ones charged with Counts 16 and 18. Those six counts all relate to preparing and signing the false certifications. They form a distinct group of charges and defendants.
A second group of defendants share Counts 9, 11, 13, 15, 17, and 19. They are Messrs. Trump, Giuliani, Eastman, Chesebro, Smith, and Cheeley, and those counts relate mainly to the attempts to file the false elector certifications.
A third group of defendants are Sidney Powell, Cathleen Latham, Scott Hall, and Misty Hampton, the only ones charged with Counts 33 to 38. Those counts describe the efforts to obtain or break into the voting machines of Coffee County. Ms. Powell was a visible advocate for Mr. Trump’s cause, but the indictment relegates her to a minor part in the Georgia portion of the broader conspiracy. Based on the structure of the indictment, Donald Trump and Rudy Giuliani were at its center, and Mr. Smith wasn't far from the core. The skills of high school gossip tell us not who's going out with whom, but who's going down with whom.
John Roberts wrote today's Supreme Court opinion in which a 6-member majority struck down the Biden administration's forgiveness of most of the student loan debt in the country. Whatever the merits of the court's decision, the Chief Justice included this allusive gem in his opinion:
From a few narrowly delineated situations specified by Congress, the Secretary [of Education] has expanded forgiveness to nearly every borrower in the country. The Secretary's plan has 'modified' the cited provisions only in the same sense that 'the French Revolution 'modified' the status of the French nobility' - it has abolished them and supplanted them with a new regime entirely.
The Chief Justice is quoting from Antonin Scalia's opinion in MCI Telecommunications Corp. v. American Telephone & Telegraph Co., 512 US 128 (1994), which turned in part on the definition of "modify." In that case Justice Scalia wrote, "It might be good English to say that the French Revolution 'modified' the status of the French nobility - but only because there is a figure of speech called understatement and a literary device known as sarcasm."
Justice Scalia did not credit any earlier source for his bon mot. I suspect he was inspired, perhaps unconsciously, by Ambrose Bierce's work "The Devil's Dictionary," in which he defined "abridge" as "to shorten," attributing this fictive mashup of a sentence from the Declaration of Independence to Oliver Cromwell as an example of "abridge" in use:
When in the course of human events it becomes necessary for people to abridge their king, a decent respect for the opinions of mankind requires that they should declare the causes which impel them to the separation.
The recent scandalous disclosures that Justice Clarence Thomas and his wife Virginia vacation not only in their 40-foot motor home but on lavish trips financed by billionaire Harlan Crow that have included flights on Mr. Crow's private jet and cruises on his 161-foot yacht were followed by the equally scandalous revelations that Justice Samuel Alito did not report his 2008 trip by private jet as the guest of hedge fund billionaire Paul Singer, to an Alaskan fishing resort where he stayed as the guest of real estate and mortgage servicing billionaire Robin Arkley. The two stories brought to mind the death of Justice Antonin Scalia in 2016 at a resort in Texas. "Resort" is a loose term for the 30,000 acre Cibolo Creek Ranch, owned by multimillionaire John B. Poindexter. (We can't have our justices selecting their friends only from the billionaire class.) You can book rooms there for $500 to $1200/night, or you can come as the guest of Mr. Poindexter, as Justice Scalia did.
It's apparent from the examples of Justices Thomas, Alito, and Scalia that the justices of our Supreme Court cannot stretch their salaries, currently $274,200/year, to cover the cost of vacations that befit their status as the nation's senior interpreters of the Constitution and the law. It's also abhorrent that owners of large corporations with business before the Supreme Court can give the justices over-the-top vacations without the justices thinking it improper to accept the gifts. Hence the Laquedem Plan to Relieve Our Supreme Court Justices from the High Cost of Vacations.
The LPTROSCJFTHCOV is ridiculously simple, because the mechanism to remove the taint of impropriety already exists. It's GoFundMe.com. Let's start a GoFundMe to raise money that the justices and their families can use to pay for their own vacations. If a million Americans will give just $1/year each, then each justice can spend more than $1 million/year on luxury travel without having to beg for hospitality from their billionaire friends. If Justice Thomas had $1 million to spend on his vacations, would he still hang out with Harlan Crow? Or would he and Virginia Thomas buy a larger motor home and hire a driver? Either way, he could escape his ethical morass.
We already provide public funds to presidential candidates. Let's offer our Supreme Court a way to escape from the convivial clutches of the kakistocrats.
The Oregon State Bar requires active lawyers to take a certain amount of coursework, called "continuing legal education" or "CLE," to renew their licenses. Members report their education every three years. New members must take nine hours of courses on practical skills, including at least four hours on Oregon practice and procedure. After their first reporting period, Oregon lawyers must take 45 hours of accredited CLE every three years, including at least five hours on ethics, one hour on mandatory reporting of child abuse and elder abuse, and one hour on mental health and substance abuse. In alternate reporting periods, Oregon lawyers must also take at least three hours on programs accredited for "access to justice." The Bar's rules define "Access to justice" education as activities that are "designed to educate attorneys to identify and eliminate from the legal profession, from the provision of legal services, and from the practice of law barriers to access to justice arising from biases against persons because of age, culture, disability, ethnicity, gender and gender identity or expression, geographic location, national origin, race, religion, sex, sexual orientation, veteran status, immigration status, and socioeconomic status."
Recent news stories have given Isaac the idea that the Oregon State Bar should require providers of CLE to meld practical skills with access to justice, resulting in the Laquedem Plan to Improve Continuing Legal Education and Honor a Legal Leader. Educators could teach lawyers how to organize luxurious hunting trips, expensive vacations, and cruises on private yachts, and then how to invite judges to be their guests. Other material would cover how to establish political organizations under Section 527 of the Internal Revenue Code to funnel unreported money to a judge's spouse. And somewhere in the mix would be how to ship rare wine across state lines to judicial incumbents.
The name of this hybrid CLE credit would honor one of its most ardent practitioners. I suggest calling it "Access to Justice Thomas."
The recent scandal that ended the political career of Oregon's soon-to-be-former secretary of state Shemia Fagan and her lucrative consulting contract with a financially struggling leader in the cannabis industry, La Mota, is notable for its celerity. On April 27, Willamette Week published Sophie Peel's story that broke the news that Secretary Fagan was receiving $10,000/month - 55% more than her state salary - from La Mota for providing then-undescribed consulting services. On April 28 the rest of the Democratic establishment moved quickly to distance themselves from Ms. Fagan, exemplified by Governor Kotek's pithy response to a reporter's question on April 29: "I don't have outside employment. I only have one job." On May 2, only five days after the story broke, Ms. Fagan announced her resignation.
Five days is unusually fast for a public official's scandal to go from unveiling to unspooling. Liz Truss served only 44 days as Britain's prime minister, but she did survive in office for six days after the Daily Star set up a webcam on a head of lettuce to see whether the lettuce or the prime minister would wilt first. [The lettuce won.]
The speed with which Shemia Fagan was expelled from the machine reminds Isaac of the famous scene in A Night At The Opera, in which Otis P. Driftwood (played by Groucho Marx) is welcomed into the offices of the New York Opera, promptly fired, and then kicked down four flights of stairs and thrown out the door.