Tuesday, April 23, 2024
Monday, April 22, 2024
Saturday, April 20, 2024
Two Insider Traders on Trump Media SPAC Pled But Garelick to Trial Wants Swider Out
by Matthew Russell Lee, Patreon Book Substack
SDNY COURTHOUSE, April 19 – As the third of four insider trading prosecutions announced on June 29, 2023 by the US Attorney for the Southern District of New York, Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick were charged with making more than $22 million dollars in illegal profits by trading in securities of Digital World Acquisition Corporation based on MNPI about DWAC’s planned but not yet public business combination with a media company founded by former President Donald J. Trump.
On July 5, the case was assigned - wheeled out - to Judge Lewis J. Liman: "NOTICE OF HEARING as to Michael Shvartsman, Gerald Shvartsman, Bruce Garelick: An Arraignment and Initial Conference is scheduled for July 20, 2023 at 12:00 PM in Courtroom 15C, 500 Pearl Street, New York, NY 10007 before Judge Lewis J. Liman."
Inner City Press was there on July 20 and live tweeted, thread
On December 29 as part of omnibus pre-trial motions Shvartsman filed copies of DHS reports of investigation, including audio recordings of Shvartsman saying he would open an LLC in Belize which would buy assets... and ultimately provided funding for the 'Truth Social' media platform. It also names the agents who brought the arrested defendants to the Wilke D. Ferguson Jr. Federal Courthouse and the Marshals...
Late on March 15 Shvartsman through counsel wrote to Judge Liman alleging that the US used a Lawyer Informant to record him. Counsel identified the Zoom account used: John [at] lighthousetrust [dot] ch. A Google search of that shows a Lighthouse Trust General Counsel named John Ivsan at Linhart Seuss Ivsan LLP
More on X for Subscribers here & Substack here
On March 29 there was a conference, thread:
Defense: We contest their attempt to call cannabis bank account a prior bad act. The bank knew, and continued to process the payments.
AUSA: The bank was misinformed.
Judge: I'm not sure it's 404(b)
Defense: DWAC has sued Mr Orlando, in Florida, alleging he spoke publucly about merger with Trump Media Group. I had assumed Orlando would be a government witness against my client. So DOJ should ask DWAC, or their counsel at Wilmer Hale, their basis
On April 1, Judge Liman docketed that Michael Shvartsman and Gerald Shvartzman were scheduled to plead guilty on April 3.
They did, and Inner City Press is publishing Michael Shvartsman's plea agreement here - it had an April 2 deadline to get a one offense level point reduction, see here.
Bruce Garelick is still going to trial - and on April 19 his counsel filed a motion in limine to, among other things, preclude evidence of DWAC board members' and other witnesses' subjective opinions and understandings. The first example given is that "DWAC Board member Eric Swider told the government that 'all the targets of DWAC were confidential, including TMTG'... This evidence fails the basic test of Rule 401."
This case is US v. Shvartsman, et al., 23-cr-307 (Liman)
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As Trump Trial Jury Completed with Alternate Man for Anti Trump Rally by UN Excluded
by Matthew Russell Lee, Patreon Book Substack
SDNY COURTHOUSE, April 19 – In the Trump Trial on the fourth day of jury selection, the last of the alternate jurors was selected, and opening statements set for April 22 at 9:30 am.
Justice Juan Merchan followed his admonition to not report on places of employment or accent in a similar vein about a prospective juror rejected due to a prior felony conviction.
But if that's not reported on, how will the public know?
Leaving things vague, the prospective juror served more than two years in a Northeastern state's prison system on drug charges. Still jury duty notices keep arriving. There were tears, an excusal and suggestion the problem could be solved.
Less sympathetic was a juror who first said he didn't remember posting about the "massive anti-Trump rally" near the United Nations, then said he'd only gone because it was near where he lived. He too was excused. We will have more on this.
More on X for Subscriber here and Substack here
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Terraform Labs Crypto Trial Ended With Verdict of Liable Now SEC Seeks $4 Billion and Fine
by Matthew Russell Lee, Patreon Substack
SDNY COURTHOUSE, April 19 – The SEC's trial against Terraform Labs began on March 25. Inner City Press was there, thread. On November 17, 2023 US District Court for the Southern District of New York Judge Jed S. Rakoff held a hearing on potential trial experts. Inner City Press live tweeted that too, thread.
From March 25, thread:
...Witness is on stand, bought $188,000 of UST on Gemini in Feb-March 2022
Terraform lawyer's Q: You thought there was no risk? Witness: Terraform Labs said that, relatively
Q: Which is riskier, UST or IBM stock? Witness: Clearly, UST. [Light laughter in the courtroom]
Terra's lawyer: Did you understand TerraUST could fall into a death spiral? Witness: Only if their representations were not true.
Terra's lawyer: Nothing further.
Judge Rakoff: Re-direct. SEC's lawyer: Why are you here? Witness: If people do wrong they should be punished. Do Kwon said it was a stable coin.
Jury leaves.
Judge Rakoff: I would never have adjourned the trial until now if I hadn't thought Mr. Kwon was doing everything to be extradited here.
More on Substack here
Ten days later on April 5, Judge Rakoff gave legal instructions to the jury for deliberation, including that "I instruct you as a matter of law that the tokens known as UST, LUNA, and wLUNA are securities." Full 24 page legal instructions to jury on Patreon here.
And then the verdict: Liable, liable, liable - and reckless, not intentional.
On April 19 the SEC filed a motion for injunction against violations, and $4 billion disgorgement, to fine Terraform Labs $420 million and Do Kwon $100 million. Motion on Patreon here.
The case is Securities and Exchange Commission v. Terraform Labs Pte Ltd. et al., 23-cv-1346 (Rakoff)
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Capital One Should Discover Merger Dead Inner City Press FOIAed Fed Now Delay to May 3
SOUTH BRONX, April 19 – Capital One has applied to buy Discover, in an anticompetitive deal that should be rejected by regulators if they mean what they have been saying. While they applied late March 20, as of 1 pm on March 22 there was no notice of the Federal Reserve's or OCC's websites. Inner City Press submitted second FOIA requests to each agency. Public hearings should be held, not only on antitrust but also lending disparities at both companies.
While the OCC has yet to provide some records requested under FOIA, it put its application in its reading room. And it is an outrage, Capital One gaming the CRA system. For example "the Proposed Transaction would result in CONA establishing a new assessment area in Delaware, which will include all census tracts in Sussex County and seven contiguous census tracts in Kent County."
That for a nationwide card and subprime auto lender...
On April 19, with the Fed's comment period coming to a close, the Fed wrote to extended its time to respond to Inner City Press' February 19 FOIA to May 3 - AFTER the close of the comment period.
As documented by Fair Finance Watch, Discover Bank in 2022 denied mortgage loans application from African Americans more than twice as frequently as those of whites.
Previously, Inner City Press and NCRC challenged Capital One's acquisition of ING Direct, see here.This time, given the antitrust enforcement claims being made in DC, this proposal should be dead in the water. Watch this site.
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As Jane Street Sues Millennium Its Request to Seal Courtroom then Request for TRO Denied
by Matthew Russell Lee, Patreon Book Substack
SDNY COURTHOUSE, April 18 – Jane Street Group LLC sued Millennium Management, Douglas Schadewald and Daniel Spottiswood, for allegedly taking trade secrets from them. On April 19 there is scheduled a court hearing on Jane Street's request for a temporary restraining order, before U.S. District Court for the Southern District of New York Judge Paul A. Engelmayer.
Judge Engelmayer on April 17 granted a motion to seal; this was followed on April 18 by not fewer than seven "selected parties" only letters.
It is said that some or all of the April 18 proceeding may be sealed. Previously, Inner City Press petitioned Judge Engelmayer in a trial with an undercover witness and an audio feed was made available in another courtroom, on the 5th floor of 40 Foley Square / 40 Centre Street.
Should this civil case be more secret?
How should notice of a possible sealed proceeding be given? Alongside a trial in 100 Centre Street, Inner City Press has had its eye on this case.
We can report that Jane Street's bid to seal the courtroom was denied. Then its application for a TRO was denied, no sufficient showing of irreparable harm. (H/T FT) Next up, July 15. Watch this site.
It is Jane Street Group, LLC v. Millennium Management LLC et al., 24-cv-2783 (Engelmayer)
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In OneCoin Case Mark Scott Wins Bail Pending Appeal Amid 2d Circuit Brief to Unseal
By Matthew Russell Lee, Patreon
SDNY COURTHOUSE, April 18 -- For scam crypto currency OneCoin, Sebastian Greenwood who co-founded the company with Ruja Ignatova was sentenced to 20 years in prison by U.S. District Court for the Southern District of New York Judge Edgardo Ramos on September 12, 2023. Inner City Press was there and live tweeted, thread here
Mark Scott, who was convicted at trial, on April 18 won bail pending appeal, after redacted submission and in order order itself with redactions.
Judge Ramos denied Inner City Press' application to unseal Greenwood's 33 sentencing letters and redacted memo. Inner City Press filed a notice of appeal - and on April 17, 2024, pro bono counsel filed the brief and appendix. Brief on DocumentCloud here.
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As Trump Jury Gets to 12 Dark Talk of Doxxing As Harry Reid and Hakeem Jeffries Mentioned
by Matthew Russell Lee, Patreon Book Substack
100 CENTRE ST COURT, April 18 – In the Trump Trial on Day 3 of jury selection, the official 12 were selected, and so far, one alternate.
It was a back then forward process, in which two of the seven already selected jurors were removed, but then at the end of the day once the peremptory challenges ran out, seven jurors and one alternate were selected.
Based on one juror's complaint, Justice Merchan admonished the Press to not report where people worked, nor if they had (just for example) a strong Irish accent.
Did this mean to not report that one prospective juror came from Venezuela, and has a position on the Hispanic National Bar Foundation?
Or that another, from Nevada, said his father was good friends with Harry Reid? Later there was a Hakeem Jeffries shout out and some asked, What was the difference? What indeed.
One juror that didn't make it - so now it could be told - was a law clerk at SDNY, and an intern in EDNY. She had discussed Mark Pomerantz' book with her co-worker, she said.
She was off - but a woman who stayed in Trump lawyer Susan Necheles' house, albeit 15 years ago, and whose husband wrote an "anti-Trump" book review, could only be struck by peremptory, after Trump's for-cause challenge was denied.
It now seemed that opening arguments could in fact take place on Monday, April 23. Already there was talk of "line sitters," at a cost or wage of $65 an hour. Why not more overflow courtrooms? Answers were hard to come by.
More on X for Subscribers here and Substack here
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In Trump Trial 2 of 7 Jurors Excused and Press Told Not to Report on Accents Perhaps Politics
by Matthew Russell Lee, Patreon Book Substack
100 CENTRE ST COURT, April 18 – Day three of the Trump trial's jury selection began with seven jurors having been sworn in. But by the lunch break, two of the seven had been removed: one due to concerns about identified as being on the jury, the other based on research by the Manhattan DA's office.
Citing the juror's stated concern about being identified, Justice Merchan told or asked the press not to report the name of juror's current or past employers nor, in his example, if they have a strong Irish (or presumably other) accent.
To Inner City Press, this is far too vague. The idea is that the judge does not want any reporting that could identify a prospective juror, even if it is said in open court.
So when late morning a juror said his father was good friends with a major politician in his home state, naming both, could or should that be reported? Isn't that exactly the type of possible political bias that not only the lawyers on the case, but the public, should know about?
Inner City Press is forced to keep two sets of (note) books. We will have more on this.
More on X for Subscribers here and on Substack here
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In OneCoin Case to Unseal Inner City Press 2d Cir Brief Filed for Greenwood Sentencing Docs
By Matthew Russell Lee, Patreon
SDNY COURTHOUSE, April 17 -- For scam crypto currency OneCoin, Sebastian Greenwood who co-founded the company with Ruja Ignatova was sentenced to 20 years in prison by U.S. District Court for the Southern District of New York Judge Edgardo Ramos on September 12, 2023. Inner City Press was there and live tweeted, thread here
Judge Ramos denied Inner City Press' application to unseal Greenwood's 33 sentencing letters and redacted memo. Inner City Press filed a notice of appeal - and on April 17, 2024, pro bono counsel filed the brief and appendix. Brief on DocumentCloud here.
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January 6 Dragnet Captures Siggy Flicker Stepson Then Released in SDNY Proceeding
by Matthew Russell Lee, Patreon Book Substack
SDNY COURTHOUSE, April 17 – A January 6, 2021 defendant was presented on April 17, 2024 before U.S. District Court for the Southern District of New York Magistrate Judge Katharine H. Parker. Inner City Press was there, the only media in the SDNY Mag Court, thread:
World collide - now at SDNY presentment of Tyler Campanella, subject of a DDC January 6 indictment (and, it's reported, stepson of former "Real Housewives of New Jersey" cast member Siggy Flicker
Judge: you are charged with entering restricted grounds on Jan 6, 2021. You have the right to an identity hearing. Do you waive it?
Federal Defender: We waive it. Judge: You have a right to a hearing in this District or DDC on probable cause FD: We waive it here
AUSA: Government is not seeking detention. We have a proposed set of condition for release. Only visit DC for court or consultation with his attorney, who we believe is in Virginia.
Federal Defender: He lives in SDNY, but works in EDNY.
AUSA: No travel outside of US without pre-approval. Reporting to Pre-Trial Services any contact with law enforcement: arrest or questioning. No firearms or destructive devices. Surrender passport
Judge: To which judge in DDC is it assigned to?
AUSA: Magistrate Judge Robin Meriweather.
The SDNY case is US v. Campanella, 24-mj-1530 (Parker)
[Campanella is in a suit, and nodded at another, older suited man here in court]
More details on X for Subscribers here and Substack here
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Virgil Griffith Got 63 Months After Pled To North Korea Sanctions Violation Conspiracy Now Asks Resentencing
By Matthew Russell Lee, Pod Patreon
SDNY COURTHOUSE, April 17 – Virgil Griffith, charged with violating North Korea sanctions in connection with a crypto-currency conference there and facing a September 27 trial, pleaded guilty in the morning and was remanded to jail.
His sentencing was set for January 18, 2022, but occurred on April 12. Inner City Press was there and live tweeted, as he got 63 months and a $100,000 fine. Thread here
Griffith: Watching Ukraine sanctions has shown me their value. I have been cured of my stubborn arrogance, and my obsession with North Korea. My career has been damaged. I'm sorry.
Judge Castel: Virgil Griffith has no ideology. He'll play off both sides, as long as he is at the center. I sentence him to 63 months in prison and a fine of $100,000.
Docketed after the guilty plea was an order allowing his lawyers to take their fees out of his Coinbase accounts, 582b97ccd7afbl018834f232 and 52fbe72ld358f6dda000010a. Photo here. Podcast here.
Jump cut two years forward and on April 17, 2024 Virgil Griffith through new counsel filed a "motion for re-sentencing under Section 4C1.1 of the Guidelines." They say a two point reduction brings the Guidelines down to 51 to 63 months. Inner City Press will follow this. Letter on Patreon here
Back on July 20 he faced a bail review proceeding - in person. He lost and was remanded, perhaps having an impact on the September 27 guilty plea. Inner City Press was there, and live tweeted, here and below (podcast here)
On September 14, in the run up to the trial starting on September 27, there was a final pre-trial conference replete with rulings. Inner City Press live tweeted it here.
On September 22, Judge Castel denied Griffith's sealed motion to depose the Ethereum Foundation's general counsel Tju Liang Chua, or to allow him to testify by video. Order on Patreon here. On other grounds - late produced discovery - Griffith's lawyers asked for a week continuance in the trial.
On September 23, initially without Griffith present, Judge Castel held a hearing then denied the request for delay. Inner City Press live tweeted it here.
On September 26, the Sunday before the trial starts on Monday, the US Attorney's Office docketed their opposition to the testimony of Ethereum's General Counsel, and e-mails of Virgil Griffith, filing on DocumentCloud here. Song here
On Saturday, Griffith's lawyer belatedly docketed their motion, on Patreon here.
The case is US v. Griffith, 20-cr-15 (Castel).
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