Former federal prosecutor Robert Mintz, a partner at McCarter & English, discusses the Special Counsel giving Mark Meadows, Donald Trump’s former Chief of Staff, immunity in the January 6th case. Bob Van Voris, Bloomberg legal reporter, discusses the testimony of Sam Bankman-Fried. June Grasso hosts.

FULL TRANSCRIPT:
This is Bloomberg Law with June Brusso from Bloomberg Radio. We had begun our jury selection process this morning, but I've been informed that there is a change of plea, and then there was another change of plea and another as the dominoes started falling in the Georgia racketeering case accusing Donald Trump and eighteen others of scheming to keep Trump in power after he lost the twenty twenty election. How do you plead to count fifteen conspiracy to commit filing false documents in indictment number two three SC one eight, eight, nine, four seven guilty. Four have now pleaded guilty, including three lawyers. Sidney Powell pleaded guilty to six misdemeanors last Thursday. Kenneth Chesborough pleaded to one felony the next day, and on Tuesday, Jenna Ellis pleaded to one felony. Tearfully, I believe in and I value election integrity. If I knew then what I know now, I would have declined to represent Donald Trump in these post selection challenges. I look back on this whole experience with deep remorse. Here to discuss how all this flipping affects the case against Trump is Michael Moore of Moore Hall, the former US Attorney for the Middle District of Georgia. So Michael, four down, fifteen to go. How significant are these please? I think it's significant anytime that you have a co defendive flip, and the lawyers flipping are a little bit of a different bird baby than we normally see. When I listened to miss Ellis and the charges against her, you heard a lot about the Trump campaign, You heard about her direction from others. She called the more senior, more experienced lawyers, and that seems to me probably where the biggest jeopardy lies, and that is with those lawyers who have instructed her to do something. So it sounded like that would be potentially mister Eastmann and mister Giuliani. And of course if they have pressure on them and they were then to cooperate, then they may get to the next level, which would be closer I think to the former president. These are all sweetheart deals, aren't they? The lawyer's deals they are. They are unusually liked. I mean, remember that this case had been tagged as essentially the largest election fraud case in history or something like that, and it's will be a massive reco case, and people are basically walking away with a slap on the wrist. They up with probation, no jail time, and a first offender plea, which means that at the end of a certain period of their probation and the completion of those requirements, the charges are since the dismissed, so that with no record, they can vote, they can have a gun, they can do all those things once they have completed the requirements that the court set out. So they're unusually light, and they are especially like when you compare them with the sentences received by people who were involved at the Capitol on January the sixth, many of whom had jail sentences, some of them very significant. So it's maybe a little bit like the architects of the building are not going to jail, the construction workers who worked on the building are. That's sort of how I see it. So I can see why Willis gave the deals at this point to Powell and Chesbro so that she wouldn't have to go to trial against them early and reveal evidence to Trump. But why give a deal such a good deal to Jenna Ellis? I think probably she has made some statements that the ba will find useful against other people in the indictment. I don't know necessarily that that's Trump, but I think she probably gave them enough information to at least move forward. And also too, I mean, she was essentially a mouthpiece for other folks involved with the campaign, and her culpability I think was probably less than other people who may have been more of a puppet master than she was. CNN I believe is reporting that Willis is talking to six more defendants who will be left to go to trial once it comes time for trial. I mean, does she have a number in mind besides Trump? I think maybe a half dozen people or a few left that will be left standing. And those may be Trump and Juliani, that may be one Eastman, maybe another, people who think they have different constitutional arguments to make. They may be stronger arguments. It will be interesting to see how Metas is involved. I mean, we've heard that he was offered some of me into your cut a deal with Jack Smith. That's very interesting to me given the statements that he has made in the Georgia case, especially during his motion to remove the case to federal court. And you know, essentially he came to Atlanta in federal court and said everything I was doing was lawful. This is part of my job and it's protected activity, and it should entitle me as a federal official to move my case to federal court. And it sounds like to the contrary. When he got to Washington, d C. He decided that he wanted to cut a deal with the special counsel and tell him that, well, I don't know that I was doing the right thing, and I tried to tell the former presence that he was telling lies or whatever. I'm not quoting again, but something to that effect. I don't think those are necessarily consistent positions, and it'll be interesting to see how that plays out. So I don't know if mss Willis at this point, given the objections that he made to have his case tried in Fulton County, will look a favorably on a potential plya offer from him. So he may be one of the few that remain. That's really interesting because he has a very experienced attorney representing him. Do you let your client testify in a federal case to something that's going to cause you jeopardy in a state case? Yeah, I don't think you do. And I think that's the problem. And I do think he has a very good lawyer. I just think some of the statements that he may have made in the federal court here in Atlanta may not be exactly consistent with positions that he has taken to the special counsel. And I don't know how you claim that what you were doing was part of your actual lawful role as a chief of staff then suggest somehow that what you were doing, you know you had objections to because you thought your boss was not tell the truth in this kind of thing. So those will be maybe inconsistencies, and what we have to see actually the substance of each statement side by side. We haven't seen those yet. But any inconsistencies certainly give room to attack credibility with a witness, and may give fodder to a defense attorney to raise objections, and certainly may give some interest at least to a prosecutor to the side when or not you know that witness needs to be put on, is a cooperating witness, or with that witness independent needs to simply move forward toward trial. So this scenario is what they think about when they say the dominoes are falling, Well, it is. You know, if you think about a line of dominoes, a circle of dominoes or whatever, you know, you can pick a domino in the middle of the line and push it to the right or the left, and only the ones in the direction that's falling are going to continue to fall. And so that's why prosecutors try to work from the bottom up. They want to push some that has information at the bottom to try to get to the top. And some people argue you should work your way down. That's not necessarily tear to those people who are much less culpable, but you push generally from the bottom of the top. Cut deals with the people who are less colpable to try to get people who are really the masterminds or the more guilty of the organization. Here, I think there has been some middle of the line pushing, if you will, and the dominoes have fallen, maybe in one direction, which is why I think you saw ultimately deal cut with Jenna Ellis. Now whether or not she then also can have information toward the top, I don't know. But when we saw Ms Powell, mister chesbro Ls, you know, in Er Please, I think that was a section maybe of this arrangement of dominoes and arrangement of dependence, and that sort of has now concluded itself. But for the other lawyers who remain in the case, the key will be in the bridge the prosecutor will have to make will be getting from those folks in fact, to the people at the top of the line, And the question is what information do they have that will get in there. I don't know if miss Powell has information about that or not. She was president of meeting. She may have information about who said what. At the same time, I don't think that she's gonna be able to put the former president's things with prints on Coffee County as we get there, I do think, and I thought this was sort of telling of the things to come. When Miss Ellis made the comment that she was simply doing what she had been advised to do, I think you're hearing a preview of the defense we're going to hear from the former president. That is, in fact, I was simply doing what my lawyers told me I should do, or what I had a right to do. I was simply following legal advice at the time. And then I think we open up the can of executive privilege whether or not he's allowed to rely out information from lawyers and advisors. We know that the president is not covered by the Hatch Act any president, and so this whole issue, well, was it a campaign or were you the president? That may not be a hurdle as we go forward, and so I do think you're going to hear a lot about Look, I was doing what my lawyers and advisers told me to do. I had taken advice from a number of different councils, some of them had different opinions. I had to make a choice. I felt like we had legitimate move forward on the alternate electric scheme as told to me by mister Chesbro. He cited to me the issue in the circumstances in the Hawaii case from the nineteen sixties or whatever it was. And so this is what you're going to hear and ultimate fly. I think many of the decisions and the ultimate outcome of this case is going to rest not on allegations made in a trial court, but ultimately what an appellate court and like the United States Supreme Court besides, is appropriate evidence and an appropriate charge. When we're talking about former president of the United States being charged in for conduct occurring while in fact he was president of the United States. And so whether or not the appellate courts look at that and say, well, he does have some privilege or some immunity, I think that that's still an open question. Yeah, a question that may be answered first in the DC federal case. Thanks so much, Michael. That's Michael Moore, the former US attorney for the Middle District of Georgia. Welcome back to real estate investing. Made simple grant cardone here in the Cardones On every Monday, I said, Steve, would I pay you last month? Steve was paid thirty one twenty dollars last month because he invested at Cardoncapital dot Com, Cardoncapital dot Com, Cardoncapital dot Com. The Supreme Court declined to hear a case involving a lawsuit against real estate management company Cardone Capital and its CEO for making misleading statements in YouTube and Instagram videos. The lawsuit was dismissed on other grounds, but the core issue remains. Does hyping investment projects or touting crypto tookens on social media make someone a seller who can be sued under federal law by investors who are defrauded or who bought an unregistered security. To put it another way, what happens when a ninety year old securities law meets social media. Joining me is Ann a business law professor at tu Lane University. So, and let's start with the basics. The very basics tell us about the securities laws and where this definition of seller becomes important. Okay, So Section twelve is from the nineteen thirty three Securities Act and it basically has two separate provisions. The first is that a purchaser of a security that was sold unregistered when it should have been registered has a right to sue the seller. Basically, it's a right of recision. They can give the security back and ask for their money back minus any income they've earned on it. So they can sue whoever sold it to them if it was sold in violation of the registration provisions. And then secondly, they can sue anyone who sold it to them or who solicited the purchase if the prospectus or sales documents contained false statements. Now, sometimes there's a bit of a debate about what counts as a perspectus, but what it comes down to is that this is sometimes a more attractive option than say, more traditional ways of suing for false statements like Section ten B, which is the anti fraud statute, because if you sue for false statements in connection with essentially these unregistered security sales under section twelve, you don't have to show that you relied on the false statement, and you don't have to show that there was any intent to make a false statement. And so how did the Supreme Court define a seller in nineteen eighty eight, So in the case of Pitter versus Doll, there was a question of who counts as a statutory seller. In other words, Section twelve speaks of people who sell securities. So the question was, do you have to be actually the person who transfer the title me to you or could it be other people who are somewhat involved with the sale? And the court first said it has to be either a direct transfer of title or it has to be someone who solicited the purchase. But they drew a distinction between someone who is somehow involved and had something to do with the buyer actively going out and purchasing the security, and instead they said they have to who have actually solicited and had some kind of relationship with the buyer. They rejected a test that would be somehow like people who are just substantially participate in the sale. So that was interpreted by courts to mean that you could only be liable under section twelve if you literally transferred title it was your security and you sold it to someone else, or if you had some kind of direct contact with a relationship with the buyer so that you induced the purchase that way. So in our world of social media, where venture capital firms and others are hyping investment projects online, are courts having a difficult time determining whether they're sellers or not. Yeah. So the issue here is that after pinter versus Doll, there were a bunch of cases involving what were basically registered offerings. They were registered offerings, they were IPOs, where people sued for false statements in the IPO documents. Now there's a cause of action specifically for that false statements in a register statement under section eleven, and they would also sue under section twelve because Section twelve has liability both for unregistered offerings, which these weren't, or for false statements and a perspective, and courts rejected the Section twelve liability looking at pinter in a lot of cases where there was no direct contact with the buyer. So for example, issuing companies, it was their security, but they sold in a firm commitment underwriting, meaning the underwriters bought the securities from the issuer. The underwriters then sold to the public. The purchaser would try to sue the issuers inter Section twelve because the issuer's name is all over the perspectives, it's like their company, it's their securities being sold, and the courts would say the issuer did not have enough direct involvement with this particular sale to this buyer to justify imposing Section twelve viability. Now, you could still have other forms of liability because these were registered offerings, but you couldn't have liability under section twelve. So the court reading Pinder vicious now very narrowly to mean you have to have had some kind of contact with a relationship with the buyer. So now we fast forward to crypto, and the problem is there isn't an alternative scheme because crypto, assuming it's a security, which is a whole everything. But let's assume it is a security. If crypto is a security, it's not registered. So the liability regime that was available in those IPO cases for registered offerings is not available to these shareholders. So for these shareholders, Section twelve is sort of the main potential avenue of liability other than the anti fraud laws, which are much harder. So they're suing under section twelve because that's it, and what we've seen now is too appellate. Court said direct contact. We never said that what are you talking about, known as it's talent is a solicitation. As long as you make these public statements in advertising urging people to buy, that's a solicitation, even if there's no personal relationship. Meanwhile, there are at least a couple of other decisions that say, no, we're sticking to the old interpretations of pinter that there have to be this kind of direct relationship. And then you have courts that are sort of like saying in a case against Coinbase that Coinbase with air drops and materials about particular securities, that wasn't a solicitation. But it's not exactly clear why, you know, the court just says that's not enough. So we don't know exactly what's enough or what exactly the regime is going to be the Supreme Court decided not to take a case involving cardone Capital. Well, that was the case that was Actually it wasn't a registered offering. I believe it was under Regulation A. So Regulation A is an exemption from a full on registered offerings, but it does require some degree of filing and disclosure with the SEC. So it wasn't an unregistered offering. But because it's not registered offerings, the standard protections available in registered offerings are not available to purchasers. Instead, the only liability available would be, you know, just straight up fraud, which is again very hard to prove, or Section twelve liability. That's what's available. And so this real estate company, they use social media to advertise the officering that was filed with the SEC, they had documents with the SEC and so forth, and shareholders claimed that these advertisements were solicitations. In the Ninth Circuit agreed and repudiated. I mean, you know, some of the case law that had held there must be direct contact hadn't come out of the Ninth Circuit, So at very least it was disagreeing with the other courts that had imposed something like a direct contact requirement. But the Supreme Court denied sort. I mean, there are any number of reasons why they could have denied CIRT. But one possibility is that the social media cases are new. They're you know, looking to this old precedent that was generated under IPO situations, and you know, it may take some time to work through the court. You know, if you ask an average person, it doesn't seem like the difficult question. They're online, they're soliciting, Yeah, they're selling. What makes more difficult, Well, because the interesting thing is that the word solicit it doesn't actually appear in the statute. Nothing in the statute says imposing liability for solicitation, but the statute says is imposing liability for selling. The Supreme Court's interpretation of selling in Printer versus Doll, this case from nineteen eighty eight is the one that imposed this concept of solicitation with this very specific kind of definition. And to be honest, Printer doesn't seem to really understand how security sales works. There are parts of it display a kind of lack of understanding. For instance, there's a line in it that says you can't have liability for a seller's seller. That if you sell to somebody and that person sells to someone else, the original seller isn't going to be liable. But that's a firm commitment underwriting, and courts have been struggling with that. The sec has been struggling with that ever since Pinter versus all held it. So, you know, this concept of solicitation and exactly how we're defining it is not in the statute. It comes from the Supreme Court case launch. So now we're all trying to figure out what the Supreme Court met and how you translate a case in nineteen eighty eight to today the Ninth and the Eleventh Circuits? Are they in sync their rulings, Yeah, they seem to be following the same path that you know, at the very least, these sort of widespread social media campaigns are sufficient. But what's really unclear is like what would be like, I mean, once you take away the requirement of direct contact, which is how courts seem to be reading it before, then there's the question of well, how much urging is enough? And that was exactly what happened with coinbase, where you know, Coinbase technically it did have direct contact. It was talking to its customers and it you know, it does whatever it does to say, you know, here's an airdrop of a new security or whatever, and a court said, well, that's just not enough. So now we have all kinds of questions, like if social media is permissible, if you don't have the restriction of direct contact, then how much urging is enough to qualify solicitation? Given that in Pinter, the Supreme Court's concern was, we don't want just substantial participation to be enough. And the reason we don't was because we want people to have certainty as to when they are potentially liable or not. It's important that we have certainty direct contact. At least that's a rule. It may not be the best rule, it may not be the most functional rule, but we know what it means. We know when we see in. Now we're in this space where it's not clear what's going to be enough. Why don't these quotes sellers want to register just to be safe. So first of all, the crypto people, I'll say that these aren't securities anyway, But the whole point is that if you register them, there's a terrific amount of disclosure you have to make, and there's very strict liability if those disclosures are false That's why courts could get away for so long saying well, we won't have Section twelve liability for these IPO situations because there were alternatives. There's some very strict liability for false statements. If you register, you have to do a terrific amount of disclosure. It's very expensive and you're risking this liability. And a lot of crypto people say that the registration requirements, like the disclosure requirements that attach, are simply not suitable for crypto, Like they ask for things that don't make sense in the crypto context, like principles of an organization when it's a decentralized autonomous organization, or addresses when there is no address. So the crypto people will say that, not only is disclosure expensive and opens us up to all this liability, but the SEC hasn't updated the registration requirements to really makes sense in a crypto world. So then will it be up to the Supreme Court to clarify this so that there is clearer guidance? Very possibly. I mean, you know, there's a lot that could happen in between now and then. I mean, first of all, if all the circuits come to settle on something I mean, the Supreme Court doesn't have the kind of passion for securities cases that say I do. So if the circuits coalesce around a principle that's coherent, then the Supreme Court may not step in at all. And you know, we can all argue about it. But you know, I'm not convinced that crypto is, you know, the wave of the future. So at some point, if crypto has becomes less popular, then we may just see less of these cases. I mean, Regulation A was how this came up in the Ninth Circuit, and that will still exist because that's sort of a formal disclosure space for securities that you don't want to do full registration for. But reggae isn't really that popular to begin with, So I mean, if crypto becomes less of a thing, it may simply be that the disdute kind of settles down by itself. Well, it's been great to talk to you, Anne. I love your enthusiasm about securities law. That's Anne Lipton, a business law professor at Tulane University. This is not about Donald Trump versus Michael Cohen or Michael Cohen versus Donald Trump. This is about accountability, plain and simple, but it did seem a lot like Michael Cohen versus Donald Trump, as Trump's former lawyer and fixer took the stand against him this week in New York State's two hundred and fifty million dollars civil front case against the former president, And it also seemed like Trump saw it that way. He's a lie trying to get a better deal himself, having word and what played out during Cohen's testimony at times seemed more like a TV legal drama than a real trial. Joining me, as someone who was there for I'm going to save the show, Pat Patricia hurtadd O, Bloomberg Legal reporter, Pat, this was the first time in five years that Trump and Cohen have come face to face. What was it like in the courtroom where there were just about twenty feet from each other? They had a stair doown match. When it came time for Cohen to take the stand, Trump his whole body was pivoted with his seat turned to look at the witness box. Did the prosecution start by having Coen testify about his past crimes? He described what he played guilty to. Of course, he's backtracked from what his actual crimes were, and you know, sort of said that he didn't commit some of the frauds that they assert that he committed. But the State Attorney General's office was asking him basically to describe what he was supposed to do for Donald Trump, and he said between twenty twelve until twenty fifteen, each year, Trump would ask him to come into his office along with Allen Weisseelbergen, you know, basically asked him to quote unquote re engineered the finances and ask him, you know, how much do you think I'm worth? And then Trump would say I'm actually not worth three point seven billion, it should be eight billion, And he and Weiseelberg would have to go back and go through the numbers and reevaluate all the properties and assets to come up with a figure that Donald Trump had decided was his networth. So Donald Trump was just getting this figure, you know, out of thin air. Yees. Basically, Donald Trump wanted something, and so they would go back and he and Weislberg would put their heads together and try to value assets, be it golf courses or whatever, so that they would achieve the number that Trump named. And Alan Weiselberg, who was the former Trump Organization CFO, has already testified at the trial. Did he confirm these meetings. This is the first time we've had an insider's book about what these meetings were about. Weiselberg was very cagy when he testified. Weiselberg is a descendant. He, along with Donald Trump, was sued by the State ag so he wasn't very forthcoming and helpful. And so this is the first time we're getting descriptions of the eating happening with Trump calling them in. He said, basically, his boss called him in and told him what he wanted. Were there any surprises in the documents that Coen testified about. Well, I mean, it's just kind of shocking to see these things because then we were shown the actual statements of financial condition and the statements about Trump's net worth, and they would say, like Trump is worth eight billion dollars or something like that, and they would say, oh, by the way, we're adding the thirty percent premium to the fact that this is a golf course that has been constructed in good condition. And so basically, you know, Trump is giving credit for the brand because the building's complete and the constructions is finished. You know, that's like saying my house is worth thirty percent more because I keep the upkeep nicely outside and I have a nice little window box outside, you know. He said, I was tasked by mister Trump chewing increased the total assets based upon a number he arbitrarily selected, and my responsibility, along with Alan Weisserberg, predominantly was to reverse engineer the various different asset classes and increase those assets in order to achieve the number mister Trump had tasked us to do. That's the heart of this case. I mean, Leticia James, the New York Attorney General, asserts that Trump has inflated his assets. Where the argument was and the Trump people as law. You know, there's all these disavowals and declarations that warn the reader of these documents to say, you know, we don't really stand by these documents. They're just the number, right. And we saw this document from twenty fourteen where Trump was trying to fly that Buffalo Bill's football team and he claimed to be worth eight billion dollars, and that was a big discussion. Trump's lawyers were saying that it's no fair, you can't bring this in. No evidence, this claim of trying to buy the Buffalo Bills was ever made to anybody, and he didn't buy the Buffalo bills, So what's the harm? No foul, right, And the judge allowed it finally into evidence because the AG's office says, well, you know what, he claimed that this was his network, and these are the documents that went to Morgan Stanley, which was accepting bids. So Trump claimed he wanted to put in a billion dollar bid to buy the Buffalo Bills in twenty fourteen, and he claimed to be worth eight billion dollars and he had Deutsche Bank bankers back him with, you know, in a testing letter from Deutsche Bank saying that he was valuable and they had seen his net worth. When Michael Cohen is saying, hey, it's all the house of cards built on nothing. And was it Michael Cohen's testimony that got the AG started investigating Trump. Cohen's claims have basically triggered all sorts of investigations. He testified about seven different congressional investigation. It prompted an investigation of the hush money case. It prompted all kinds of investigation of Trump and his assets. Now we stand here, and I'm not saying that he's the only whistleblower, but he was the insider that said this is what Trump was doing, and it started everybody looking at him. And certainly this case originated from Michael Cohen's complaint. And I understand that the cross examination got nasty pretty quick. Yeah, I mean, you know, Cohen's a lawyer, and he got very offended when Alena Haba, who is Trump's lawyer, started asking him questions about that he lied to a federal judge, just like he lied to his wife on his tax return. And Cowen got very angry, and there was a lot of back and forth, you know, asked an answer. It was like a movie watching people arguing and bickering on the stand. Was like, Cohen is a lawyer, and he objected, he goes objection, so he is a witness objected through Alena's question. You don't see that other day, No you don't. And you know, at one point Alena shot back, do not on me, Copa, You're not on your podcast, you're not on CNN. Answer my question. So you can see there's a little bit of drama planes on both sides. This is Cohen, I'm objecting to your question. And at one point, probably we've all heard, you know, when the judge will say that question was asked and answered, and that's an objection, and Cohen said, asked an answered because she kept repeating about four times, did you lie to Judge Pauli, who was the federal judge he pled guilty too, And then subsequently Cohen claimed that he was forced to play guilty by his lawyers and he hadn't really committed some of the crimes that he pled guilty to originally, and this is in front of a judge. So all of this is yeah, so this is like right, this is exactly right. There's almost like two divergent trials going on at the same time. There's the trial that's being held if you had a jury, and the lawyers are being very dramatic and even the witness to you know, oh a check. And you're watching some kind of like reality TV show someone playing a lawyer, and that's being played too, as if there were a jury, and that might be more effective if there were a jury, but there isn't a jury. And obviously it seems like some of the lawyers know they have a very important client in his name is Donald Trump, so they're asking questions to please him. And then again you have the one person who is the jury of one who is judge and Gaurance who's deciding this. So that's what I said. It's like a parallel universe. There's two parallel trials, the one that's being played out Bible parties in the well as well as the one that's actually going on before the judge. And he has to keep reminding the lawyers you know, actually there's no jury here. I'm the trier of fact. So did Trump react during Cohen's testimony that you could say, Oh, he had his arms crossed and he was really he muttered something under his breast. I could not hear someone else claiming they had heard him say something about Cohen's credibility. But he was obviously very annoyed, and like I said that, he literally turned his entire chair around so that his arms crossed to glare at Cohen. And more drama to come, as Ivanka Trump has been ordered to testify. That may be as soon as next week. Thanks so much, Pat. That's Bloomberg Legal reporter Patricia Hurtado. So today we're announcing a federal lawsuit against Meta met of course, is the parent company of Instagram and Facebook, for knowingly harming the mental health of young social media users. In short, Meta intentionally designed its social media platform to be more addictive to kids and young people. Forty one states are suing Meta platforms, claiming it exploits young people for profit by building an addictive features that basically hook kids on Instagram and Facebook, harming their mental health. At a press conference by the Attorney General of Washington State, two teenagers describe their struggles trying to cope with social media side like Instagram. The worst part was these pictures and videos were never ending. The addictive algorithm and the constant flood of new content kept me glued to my phone, and before I knew it, I began to hate myself and the way I looked. This all happened before I turned thirteen. So I would go on my phone and tending to do other things, and then instinctively start opening up Instagram, opening up different social media platforms without even meaning to, and then getting stuck in the cycle of scrolling seeing other people's lives and interactions. Joining me is Matthew Shettenhelm, Bloomberg intelligence analyst so Met. The federal lawsuit says Meta did not disclose that its algorithms were designed to capitalize on young users, dopamine responses, and create an addictive cycle of engagement. So the allegation is that Meta specifically designed an algorithm to teenagers. That's exactly right. So the lawsuit takes aim at a number of features that are sort of fundamental to how Meta designed its social media platforms. Using data about the teens to send them content that keeps them scrolling and keeps them reading, sending them notifications that keep them coming back to the service as soon as they look away from it. Using the like system that entices them and draws them in and pushes them to put more content out there. And the allegation is that Meta knew that its social media service was harmful to teens, but it withheld that knowledge and misled users and proceeded to deliver its product to teens. Anyway, there's a separate lawsuit actually in this same federal court that goes to the design of the product itself and whether that violates product liability law or whether face Book was negligent in designing it. This suit's a little bit different. It's not about the design itself. It's about did Meta lie, did it mislead users? And a lot of this is based on the whistleblower who released internal documents in twenty twenty one. Yeah, I think that's the real start of this, when Francis Hoggin came out with her release of the internal documents suggesting that Facebook knew more about the risk to children than it was letting on. So this has really been playing out ever since that moment. Now Facebook disputes her allegations and says that they're overblown, and that's the sort of allegation that would be tested in this case if it gets past a motion to dismiss. Meta said, we share the Attorney General's commitment to providing teens with safe, positive experiences online and have already introduced over thirty tools to support teens and their families. Do you know what kind of tools they're talking about. I think these are features like there are settings that teens can put on the product to turn off after so many minutes on the product. I think there are a handful of features like that that they have added. If you go into the settings, you can turn off the data that is used about you for ads. I think as a practical matter, these features may not be used all that frequently. I know my teenager doesn't jump to find those features, and I suspect that's true of many other teams as well. So I think the negotiation here before this lawsuit was filed with the States likely trying to push Meta to find more features and more effective features. And I think eventually, if you saw this lawsuit settle, you might see a push for even more in that direction. Thanks Matt. That's Bloomberg Intelligence analyst Matthew Shettenhelm, 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 and at www dot Bloomberg dot com, slash podcast slash Law, and remember to tune into The Bloomberg Law Show every weeknight at ten pm Wall Street Time. I'm June Grosso, and you're listening to Bloomberg

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Implications of Mark Meadows Getting Immunity

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