Pence to Challenge Subpoena With Novel Defense

that day. And I told him, despite what you issued last night from your campaign, Mr President, you know, I've been very clear, but I don't have the authority to reject votes. And I reminded him we both took an oath to support and defend the constitution of the United States. I told him it was a promise that I may to the American people and to Almighty God. Now. Special Counsel Jack Smith wants to hear from Pence as part of his investigation into efforts by Trump and others to

overturn the presidential election. He subpoenaed Pence to appear before the grand jury, but the former Vice president says he'll fight the subpoena using a novel legal theory around his role as President of the Senate and the section of

the Constitution known as the speech or debate Clause. Joining me is national security expert Bradley Moss, a partner Mark Zad Brad and his memoir, Pence revealed that he was part of a number of conversations where Trump and his legal advisors were pushing claims about widespread voter fraud or floating novel legal theories that could be used to keep

Trump in the White House. And in a Wall Street Journal opinion piece, Pennce said he told Trump that it would be illegal for him to interfere in the count during an Oval office meeting with lawyer John Eastman. So how can he claim privilege? Hasn't he waived it? So what he could argue is that he can only be forced to testify regarding those matters that he's already disclosed. And obviously what he put into the memoir, what he discussed in the op ed isn't truly of the interest.

I mean, it's relevant, it's certainly something that the Special Council's team would want on the record and under oath, but it's not the critical pieces of information. What they want are things such as what Mike Pence and Donald Trump said to each other in private on those phone calls, including in the final hours and the last day or so leading up to January six, where there was no other aid with Mike Pence. We know he said in

his staff out of the room. We know there was staff with Donald Trump, but they didn't hear what Mike Pence said. And that's the kind of information that the Special Council will be going after, and that Mike Pence has not disclosed anywhere. So Pence is going to fight the subpoena using the argument that he was acting as President of the Senate during the January six insurrection and invoking the speech or debate clause. Tell us more about

his argument. So it's a novel argument. It's an interesting one. You know, constitutional scholars will get a kick out of it, but there's not a lot in the way of any kind of real precedent to guide anybody as to how it would play out. So, yes, under the Constitution, the vice president it kind of has two roles. One, obviously is the executive branch role under Article two of the Constitution, very limited authorities. But that's what the role is set

up to do. The other one is what is set up under Article one of the Constitution, which deals with Congress, and that is that the Vice President serves as the President of the Senate, you know, can break ties things like that, and also of course ultimately convenes and presides over the certification of the electoral votes to decide who is the next president. So is this sort of non frivolous argument that because of the dual roles, he can

argue that he was acting in that legislative capacity. He was fulfilling a legislative activity, and therefore any discussions he had about and leading up to his actions on January six in that role would be covered by the speech and debate clause. It's never been done before. There's been some limited arguments on this in court, such as the just Department invoked that same clause de protect mini civil suit. It's unclear how it would play out here in a

criminal context. We really don't know. You have to assume to some extent, you know, Jack Smith, the Special Council's team has played out the legal arguments and decided they have sufficient grounds to move forward if it's challenged on its basis it protects legislators from certain law enforcement actions if the conduct is related to their legislative duties. Right, So would this protect him if you know, he was having conversations with Trump that were not exactly related to

his legislative duties. That happened, you know, before the Capitol attack, that happened in the White House. So again that's where there there's limited case, lot of guide as the most recent sort of guy posts we have is what Senator Lindsey Graham dealt with dot in Georgia when he fought Fulton County the piano to testify before that special grand jury.

He was partially successful. The courts ultimately include that even informal sort of you know, fact finding efforts done by Lindsey Graham in his legislative capacity during those phone calls he had with Georgia officials were sufficiently you know, within the scope of legislative activity and he couldn't be forced to testify about it. But beyond that, separate actions such as what was described as you know, cajoling and you know, trying to extore the Secretary of State down Georgia to

throw out votes things along those lines. That is something the courts concluded would not fall within the scope of legislative activity and therefore he could be questioned about it, and he ultimately was what he said. We don't know yet. We're waiting to see what we find out on Thursday when some of this grand jury report comes out in from Georgia. But that's kind of where this is likely going, is that what Pence is trying to do is get

the scope of this subpoena ultimately narrowed. This is my view where he's realistically doing this, get it narrowed, parcel out what can and cannot be asked of him, sort of narrowed down where the Special Council can go with this, and then he'll respond as necessary. Apparently there have been months of negotiations with the Special Counsel and and Pence his lawyers, and they haven't been able to come to any resolution. Obviously, or the Special Council wouldn't have taken

this step. Do you think a court would be better able to parse it out? I think part of that is politics and optics that obviously Mike Pence is going to run for president. He can't be seen as you know voluntarily complying with the Justice Department's investigation here, or lest he you know, anger some of that very conservative base that obviously he's going to be courting um in the primaries for the presidential race, so he's got at

least put up some sort of fight. We have no idea what the negotiations look like between his team and the Special Council. Maybe a Special Council's team wasn't willing to narrow things sufficiently, and pensive team thought they had sufficient basis, you know, in court to get it further narrowed. We just don't know, but at a minimum, I'm not shocked heeps putting up some sort of legal fight. He has to do that for politics of nothing else. How long will it take for a fight like this to

play out in the courts? I mean, there want to be appeals, it might go to Supreme Court. So the good news is because this is a criminal matter, because there's you know, a pending grand jury. It's not like a civil action where it could take months years. You think about the Lindsay Graham matter that was handled in a couple of months. So you know, let's say there's a court action that's filed this week to quash the subpoena.

You know, we're in February. It's very plausible to imagine this being resolved, even to get all the way up to the Supreme Court, no later than mayor June. I don't think you'll actually take that long. I have a feeling this is, just like I said, a negotiating tactic to narrow down the scope of what's going to be asked. But this will certainly if he moves the quash, it will delay things for weeks, if not month, But if

not going to be you know, outcome determinative comps. Lawyers say that he intends to exert executive privilege to fight the Special Council subpoena of Pence. There seemed to be several problems with that one. This is a criminal investigation, isn't it correct? So he certainly can invoke it. That is still his right and in his standing to invoke it, but it will likely fail in to be far weak er legal case ace than what Pence is apparently considering

doing with the speech and debate clause argument. The executive privilege claim here would come back to the Supreme Court

precedent from the seventies with Nixton. Even there, the Supreme Court concluded that if there is a compelling interest that the Justice departments inquiry into criminal activity would override an incumbent president's legitimate, otherwise legitimate executive privilege claims, there's no reason to believe that argument would somehow hold up here, And that's probably why Pence isn't really going with that

line of argument. If anything would be a throwaway, the legislative activity one is a far more interesting one, far more legally confusing one, which is the late things longer. And Trump has attempted to claim executive privilege several times to try to block the House January six committee, apparently also to try to block some testimony to the federal grand jury. Has he been successful in any of those, for the ones that have been made public, No, he

has not. He has at most potentially narrowed some things that obviously the grand jury procedes because their secret A lot of that. We don't know what's gone on behind the scene. We know people who have gone through testify before the grand jury, we don't know the extent to which they actually were allowed to answer questions, to what extent there were fights over executive privilege in terms of they invoked it at the Grand jury proceeding itself, and

then there was additional fighting behind the scenes. We just don't know. It still remains secret, but in the public fights, especially with the January six Committee and then his fight with Nara over the turnover of documents the Generous Sex Committee, we know that the former president failed time and time again in those regards. Let's turn to the Special Council's inquiry into the classified documents found at Trump's marrow La go Home. Apparently Trump's team turned over an empty folder

mark classified. And here's what Trump attorney Timothy Parla Tory said about that m folder on CNN. The folder is kind of one of the more humorous aspects of this whole thing. Uh, this is not a classified folder. This is a folder that when my team went through and searched and they wrote up their report which we turned over to d o J, they saw it's a It's a folder Manola folder that says classified Evening Summary on it.

And it was in the President's bedroom. He has one of those landline telephones next to his bed and it has a blue light on it, and he keeps them up at night, so he took the Minola folder and put it over it so that it would keep the light down so you can sleep at night. And it's just this folder. It says classified Evening Evening Summary on it. Is not a classification marking. It's not anything that is controlled in any way. There's nothing illegal about it. There's

nothing in it. And when d J found out about it, they went crazy and they said, hey, actually gave me a spiana to say, give us over this empty folder. That means nothing. I mean, I'm just wondering where that came from and why. So, yeah, this this was a very clever little piece of media technique and tactics by the Trump lawyer trying to use this the red herring to make it sound like all we're talking about is

a bunch of you know, former folders. Now, so there was a folder at issue that apparently was labeled as classified Evening Briefing that was not turned over. We don't know the extent of what was what kind of marketings were on it, but let's be clear if the folder was empty, and all it was is the Manilla folder with the original markings on it. The folder itself is not classified it shouldn't have been in its possession anyways, and if it's subject speed, you turn it over anyways.

But that's not a classified document, it's an empty folder. The documents that were returned over in January two, in June, and then we ultimately see in August of twenty two, those are what remains the issue of true criminal liability. Those weren't empty full there's those were documents. Those were documents with proper classification markings on them. That's what the

true liability. This was just a little interesting media ployed by the Trump lawyer, which was clever, but ultimately irrelevant from a legal standpoint. Now we know that classified documents have been found at President Biden's home and former office, and at Mike Pence's home. Here's what Penn said in January about the discovery of classified documents at his Indiana residence. Those classified documents should not have been in my personal residence.

Mistakes were made, and I take full responsibility. There's a special counsel for the Trump classified documents. There's a special counsel for the Biden classified documents. Do you think that Attorney General Merrick Garland is going to appoint a special counsel for the Pence documents as well. So if Mike Pence ultimately does announce a run for president, I ex act there will be an appointment of a special counsel, if only to remain consistent with what Mark Garland has

been doing. He announced one for Donald Trump only after Trump announced his candidacy for the presidency. He announced one for President Joe Biden because it is the president and I its it advanced the point where it was looking like it was going to be at a potentially criminal inquiry, and it's the sitting president, so there was a concern about the conflict of interest. I understood why Marrick Garland

did that. Mike Pence is not running yet. If he were to announced tomorrow, I would fully expect that they would shortly thereafter being announcement of a special counsel for the Pence document I don't expect anything to come about criminal wise with respect of the Pence doctor stuff and Brod your final thoughts on Pence's challenge to the grand jury subpoena. Legal academics are you know, popping the pop corps. But now it's an abstract legal discussion. It most of

what it is and it's a fascinating one. It's possibly got a flesh out some really interesting guide posts, an article one article authorities. He's going to testify in some limited regard. Thanks so much, Brad. That's Bradley Moss apartment, Mark Zade. The Federal Trade Commission has halted its in house lawsuit challenging Meta platforms acquisition of VR developer Within Unlimited. This follows a federal judge denying the FTC's motion for

preliminary injunction to halt the deal after a trial. Joining me to look behind this reprieve for Meta is Bloomberg Intelligence senior litigation analyst Jennifer ree So. Meta has a history of buying up promising VR technology, including Beat Games and Oculus, and it's reminiscent of Facebook's early purchase of Instagram and What'sapp. So tell us about the FTC suing to stop Meta from purchasing Within. Now, you're exactly right, June.

Meta does have this history of acquisitions, particularly in the VR space, and I think the FTC is really concerned about what has happened in the last ten years with big tech platforms that they kind of swallow up these small nascent companies that might have grown into big companies and been their competitors, and they're trying to nip this

stuff in the bud now. So what they're looking at today are Meta's ambitions in the virtual reality space, and they understand that they really want to be the leader there and they think fitness apps in the virtual reality

space are very important. So what they did here is they tried to stop Meta from buying a small company within which makes this virtual reality fitness app because they said that Meta could do this on their own and that would increase competition if Meta did it, rather than buying up an entity that it might compete within the future.

So what they did is they relied on this theory that they don't compete today Meta and this company within that they want to buy, but hey, they could compete in the future, and so the deal, the acquisition is anti competitive because of that potential competition possibility. Here, the judge accepted that theory but still ruled against the FTC. Why right, And I will say that the judge accepting the theory was really a win in this case for

the FDC. I mean, I think they're probably pretty happy with where they came out here even though they lost the battle in a way. You know, Meta won the battle, but may have lost the war here because this theory, this potential competition theory is is an old theory. It's never really been endorsed by the Supreme Court, and there's

some that say it's really not a valid theory. Um Meta argued that it wasn't a valid theory, and they also argued that even if it is a valid theory, the standard by which you have to prove that there'd be potential competition is very high. So in this case, not only did the court say, you know, this is a valid theory. You know, even though the case law is from the nineteen seventies and we haven't really seen anything since then, this is a valid theory that the

FDC can rely on. A merger can be anti competitive even if one of the companies, the buyer, is only a potential entrant into the market and doesn't compete today. And I think that was a big step for the FTC to get that ruling. And the court also said that the standard isn't as high as Meta says it has to be. For them to prove that right, they have to prove some reasonable probability that the buyer would enter the market. They don't have to go beyond that.

They don't have to show parallel conduct or oligobalistic conduct in the market today, which is what Meta had argued. So that's a win for the FTC because it gives it a blueprint for future cases. In line of that, why did the judge rule against the FTC in stopping the merger? So basically what the judge ruled here is the evidence simply didn't show Ben that there was a reasonable probability that they would have entered this dedicated VR

fitness app market but for the acquisition of Within. They looked at all the evidence, the testimony and the documents. What it showed, the judge said, is that Meta thought about it, they contemplated it um and they thought about lots of possibilities in terms of getting into VR fitness, but that they would not have entered that. The FTC didn't show that they probably would have entered if they didn't buy Within. So this was a failure on the facts and on the evidence, and not a failure on

the legal theory. And I think June, that's probably why the FTC chosen not to appeal right, because it's a lot harder on appeal to reverse a lower courts finding of facts based on the evidence. They are the ones that looked at the documents, the lower court judge, they're the ones that heard the testimony, and they're listening to that and reading the documents and determining how they think they shake out. The appellate panel can't really do that.

So if the FTC were arguing, well, they made an error of law here, the appellate panel would have more discretion right to reverse the lower court, but not in this case, And in fact, the FTC is probably pretty happy with where they came out on the law. The FTC. You can challenge mergers on two tracks in the federal court system and in house. So could the FTC have tried to stop the deal in a process before an

FTC administrative judge. Yes, absolutely, and that process was ongoing, and by the way, if it had continued, the FTC stopped it. But had it continued, the hearings would have started yesterday, and there was scheduled to start on February. I think what happened here is that it's much harder to prove the case in this internal proceeding, which is called a Part three than it was in the lower court in the hearing which was just for a preliminary junction.

The standard is higher. So in court where they just lost, they really only had to show, well, there was some reasonable questions on the merits. Maybe it was fair to dig in deep Burg to see if they would have success to prove that this deal is anti competitive. But in the internal proceeding they really have to show that

the deal itself would substantially less in competition. So it's it's harder to prove and so in this case, I think if you can't prove it with the lower standard, you probably can't prove it with the more difficult standard. And also the companies have closed, so once they're integrated and closed, it's much harder later, even if you win in court to get an order to unwind. So I

think that's probably why they stopped. They withdrew the Part three and said we're done, and FTC spokesperson said the f GC is still deciding whether or not to continue an in house trial before the admit strative judge, so they could revive the challenge. Do you think there's any chance that they would I think it's probably unlikely. First of all, as I said, the deals closed, the companies

are going to integrate. So even if they went before the judge and nine months from now or ten months from now they had a decision that was good for them, I doubt the judge would actually unwind the deal because

it's just, you know, you're unscrambling the eggs um. And also, they recently lost in front of the Administrative Law judge a somewhat similar suit based on potential competition, and they may be worried that what they'll come out with is worse than what they've come out with from the district court. So I suspect they probably won't. You know, I always have heard that these agencies have an easier time before

their own in house judges than in federal court. But you're saying the standards were higher before the in house judge. So in this case, the standard was higher because the FTC was seeking just a preliminary injunction, so they're not

seeking an order that the deal is anti competitive. They're simply asking a judge to look at the likelihood that they could win on the merits, the likelihood that they could prove in a bigger and more drawn out proceeding that the deal would violate the antitrust laws, and all that they really have to do is raise questions that make it fair that it would be fair to dig in deeper, right, whereas in front of the administrative law judge they have to prove that it's anti competitive, So

it's just it. It's a slightly higher standard. I think where we think about the fact that it might be easier for the FTC to win in front of their own administrative law judge than in front of the federal judge is that the federal judges historically have been business friendly and probably more business friendly than the administrative law judge at the FTC IS. And the other thing is, I think in the past we've seen them mostly win internally because they've brought cases that are easy for them

to win. They've brought the cases that where the evidence always on their side. Things are different today. The FTCs bringing cases that are hard to win. They're bringing new cases, they're basing it on novel theories. These are cases that are harder to win. And so far, what they found is that the administrative law judge hasn't necessarily been on their side. As you said, the law was on their side, and they may be happy with that, But Lena khn

is trying to push the boundaries of antitrust law. And when the public looks at this, what do they see? They see Meta one, This the FDC laws the FTC, you know what, its hands up in the air and drop its case. Is that a bad look for the FTC? You know, I would say yes, it is a bad look for the FTC in the short term. But I think what Lena Khan and the majority of the FDC

have in mind is the long term. You know, they're trying to make substantial changes to the law or incremental changes I should say to the law that take time and will take losses and will take taking risks. So in the near term they lost, that's what most people

will see in the news. They're losing other cases, They're bringing other risky cases, and I in the short term it doesn't look good for them, But in the long term this is probably going to help them because in this case, the facts just simply didn't support the idea that Meta was a potential entrant. But in the next case, they're good on the law at least in the Ninth Circuit and some other circuits. Northern District of California was where this was, and the facts and the evidence might

be more on their side. There might be more substantial evidence that this buyer was thinking about and was a potential entrant and and didn't enter and instead bought a rival. Right, So this gives them a legau possibly in the next case, and so things might in the long term turn around and that they'll start to have wins. The FTC has separately filed a lawsuit against Meta, asking a court to force it to sell subsidiaries Instagram and WhatsApp. So those

are done deals, done for a long time. Where does that stand? And how difficult to battle is that? That's a different kind of case in the federal court. It's taking a lot longer, that's in depth litigation, it's not

a preliminary in junction. And I think again, I think that's probably a bit of a losing battle for the FTC because what they're trying to do is show that an intention by Meta over time to just seek out companies that might have competed with them, that might have grown to be a larger competitor um and been a threat and to buy them up before they could be a threat. And perhaps Meta did have that pattern, and

perhaps that was the intention. But I think the difficulty here is that they would have to show that but for Facebook at the time buying what's happened buying Instagram, that those two companies would have risen up to be a social media networking competitor to Facebook. And I think that's a very very difficult thing to show this but four world, especially because some would argue that Instagram has become popular because of the resources that Facebook but behind

Instagram after buying it. So I think that that's a very difficult case to prove, and where they're still in the discovery process there, so we've got some time ahead of us on that one. You talk about how the FTC is in this for the long haul, the antitrust battle, a battle against the tech companies. But if there's a change in administrations, the FTC maybe going in a totally different direction and this whole march forward may just be stopped.

I mean, you're absolutely right. It all depends on new leadership at the FTC. If there's a change in administration, certainly the chair position will change and the majority will flip from Democratic to Republican if if there is a change, Even if the next president is also a Democrat, things could still change at the FTC because that there are

terms that end for the commissioners. You know. I think that there is some bipartisan push here to try to do something to curb the power and dominance of the big tech platforms, and that is a bit behind what the FTC is doing. There's no doubt that they could make strides that could then get pulled back by the

next administration. But I do think that there is a concern that is bipartisan right now about the dominance of big tech and some of the patterns of the last ten years of the big tech companies, And so I think there's a good chance that new leadership may actually they could pull back a little bit, but would still pursue some of what the FTC is pursuing. Now, Thanks Jen, that's Bloomberg Intelligence Senior litigation analyst Jennifer Ree, and that's

it for this edition of the Bloomberg Law Show. Remember you can always get the latest legal news on our Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify, and at www Dot Bloomberg dot com, slash podcast Slash Law, and remember to tune into The Bloomberg Law Show every week night at ten pm Wall Street Time. I'm June Grosso and you're listening to Bloomberg