I’ve already made clear in my postings that I don’t have a lot of faith in the U.S. judicial system, especially as it relates to the failure to prosecute some sacred cows in the political class, beginning with Hillary Clinton and others who blatantly violated the law. But every now and then someone shows up who appears to have some sense of following the law and not just going with the flow.
That’s why I was struck by Federal Judge T.S. Ellis, III, and his line of questioning and the things he said in response to federal prosecutors in their defense of the indictment of Paul Manafort — Donald Trump’s presidential campaign chairman for a couple of months in 2016 — by Special Counsel Robert Mueller. The judge’s comments have been termed “a beat down” of the prosecutors, and it certainly does have elements of a beat down. At least Ellis didn’t just roll over in deference to the prosecutors.
Some of what Ellis had to say is worth repeating here:
“What we don’t want in this country is we don’t want anyone with unfettered power. We don’t want federal judges with unfettered power. We don’t want elected officials with unfettered power. We don’t want anybody, including the president of the United States, nobody to have unfettered power. So it’s unlikely you’re going to persuade me that the special prosecutor has unlimited powers to do anything he or she wants.”
I just about jumped up and cheered when I first heard those words.
The judge also called out the Special Counsel on what he sees is the real intent of Manafort’s indictment, and the danger of the strategy:
“It’s vernacular by the way. I’ve been here a long time. The vernacular is to sing. That’s what prosecutors use, but what you’ve got to be careful of is they may not just sing. They may also compose. I can see a few veteran defense counsel here, and they have spent a good deal of time in this courtroom trying to persuade a jury that there wasn’t singing, there was composing going on.”
I don’t make a habit of it, but I think it is worth providing the full transcript of the hearing held before Judge Ellis on May 4 in the Manafort matter. Yes, I know it’s very long, but I think it is worth reading in its entirety, even if it takes a few sittings to do so. Obviously, we don’t know how Judge Ellis will ultimately rule on Manafort’s challenge, but at least he didn’t give the Special Counsel’s minions a pass and raised some important questions. I hope to report on Ellis’s decision as the case proceeds over the coming weeks.
Here presented for your reading pleasure and edification is the full transcript of the May 4 hearing in the US District Court of Eastern Virgina (EDVA):
Transcript: Oral Argument EDVA in US vs. Manafort (motion challenging the Special Counsel)
US District Court EDVA | 4 May 2018
UNITED STATES DISTRICT COURT EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION
UNITED STATES OF AMERICA, Plaintiff,
PAUL J. MANAFORT, JR., Defendant.
TRANSCRIPT OF MOTIONS
BEFORE THE HONORABLE T.S. ELLIS, III
UNITED STATES DISTRICT COURT JUDGE
APPEARANCES: FOR THE PLAINTIFF: ANDREW A. WEISSMANN, ESQUIRE GREG D. ANDRES, ESQUIRE MICHAEL R. DREEBEN, ESQUIRE UZO E. ASONYE, ESQUIRE OFFICE OF THE UNITED STATES ATTORNEY 2100 Jamieson Avenue Alexandria, Virginia 22314 (703) 299-3700
FOR THE DEFENDANT: THOMAS E. ZEHNLE, ESQUIRE KEVIN M. DOWNING, ESQUIRE MILLER & CHEVALIER, CHARTERED 900 Sixteenth Street, N.W. Washington, D.C. 20006 (202) 626-6062
THE DEFENDANT, PAUL J. MANAFORT, JR., IN PERSON
COMPUTERIZED TRANSCRIPTION OF STENOGRAPHIC NOTES
THE COURT: All right. Call the next case, please.
THE CLERK: United States v. Paul J. Manafort, Jr., Criminal Case 1:18-cr-83.
THE COURT: All right. Who is here on behalf of the special prosecutor?
MR. WEISSMANN: Good morning, Your Honor. Andrew Weissmann for the special counsel’s office. With me today are Michael Dreeben, who will be arguing the motion, Greg Andres, and Uzo Asonye.
THE COURT: Yes. Good morning to all of you. Who will argue today, Mr. Weissmann?
MR. DREEBEN: Good morning, Your Honor, Michael Dreeben.
THE COURT: All right. Spell that for us, please.
MR. DREEBEN: D as in David, R, E as in echo, E as in echo, B as in boy, E as in echo, N as in November.
THE COURT: Okay. And, Mr. Asonye, I’m glad to see you here. I indicated that the special counsel should have local counsel, and that’s you.
MR. ASONYE: Yes, Your Honor. Thank you.
THE COURT: Good morning.
MR. ASONYE: Good morning.
THE COURT: All right. For the defendant, who is here?
MR. ZEHNLE: Good morning, Your Honor. Thomas Zehnle on behalf of Mr. Manafort, and with me is Kevin Downing.
THE COURT: All right. And also with you is?
MR. ZEHNLE: The defendant, Mr. Manafort. I’m sorry.
THE COURT: All right. Good morning to all of you. Who will argue today?
MR. DOWNING: Mr. Downing will argue today, Your Honor.
THE COURT: All right. Spell that for me, please.
MR. DOWNING: Mr. Downing’s name? D-O-W-N-I-N-G.
THE COURT: All right. Thank you. The matter is before the Court today on your motion, Mr. Downing. So you may begin. I have some knowledge. Let me ask a few facts so that I can be clear. Let me ask the government — or not the government — the special counsel a few questions, Mr. Dreeben.
MR. DREEBEN: Yes, Your Honor.
THE COURT: All right. The indictment against Mr. Manafort was filed in February, but it actually was antedated by a filing in the District of Columbia. These allegations of bank fraud, of false income tax returns, of failure to register or report rather, failure to file reports of foreign bank accounts, and bank fraud, these go back to 2005, 2007, and so forth. Clearly, this investigation of Mr. Manafort’s bank loans and so forth antedated the appointment of any special prosecutor and, therefore, must’ve been underway in the Department of Justice for some considerable period before the letter of appointment, which is dated the 17th of May in 2017. Am I correct?
MR. DREEBEN: That is correct, Your Honor.
THE COURT: All right. So when the special prosecutor was appointed — and I have the letter of appointment in front of me — what did they do? Turn over their file on their investigation of Mr. Manafort to you all?
MR. DREEBEN: Essentially, Your Honor, special counsel was appointed to conduct an investigation —
THE COURT: I’m sorry. Answer my question. Did you remember what my question was?
MR. DREEBEN: Yes, Your Honor, and I was attempting to answer your question. We did acquire the various investigatory threads that related to Mr. Manafort upon the appointment of the special counsel.
THE COURT: Apparently, if I look at the indictment, none of that information has anything to do with links or coordination between the Russian government and individuals associated with the campaign of Donald Trump. That seems to me to be obvious because they all long predate any contact or any affiliation of this defendant with the campaign. So I don’t see what relation this indictment has with anything the special prosecutor is authorized to investigate. It looks to me instead that what is happening is that this investigation was underway. It had something. The special prosecutor took it, got indictments, and then in a time-honored practice which I’m fully familiar with — it exists largely in the drug area. If you get somebody in a conspiracy and get something against them, you can then tighten the screws, and they will begin to provide information in what you’re really interested in. That seems to me to be what is happening here. I’m not saying it’s illegitimate, but I think we ought to be very clear about these facts and what is happening. Now, I think you’ve already conceded appropriately that this investigation that has led to this indictment long antedated the appointment of a special prosecutor; that it doesn’t have anything to do with Russia or the campaign; and that he’s indicted; and it’s useful, as in many cases by prosecutors, to exert leverage on a defendant so that the defendant will turn and provide information on what is really the focus of the special prosecutor. Where am I wrong in that regard?
MR. DREEBEN: The issue, I think, before you is whether Mr. Manafort can dismiss the indictment based on his claim.
THE COURT: Yes. Now I asked you: Where am I wrong about that?
MR. DREEBEN: Your Honor, our investigatory scope does cover the activities that led to the indictment in this case.
THE COURT: It covers bank fraud in 2005 and 2007?
MR. DREEBEN: Yes, because —
THE COURT: Tell me how.
MR. DREEBEN: Your Honor, the authorization for the special counsel to investigate matters is described generally in the appointment order on May —
THE COURT: I have it right in front of me, and it won’t surprise you to learn that I’m fully familiar with it. My question to you was, how does bank fraud and these other things that go back to 2005, 2007, how does that have anything to do with links and/or coordination between the Russian government and individuals associated with the campaign of Trump?
MR. DREEBEN: So the authorization order permits investigation of two different things that are described in separate clauses. The first are links and coordination between individuals associated with the Trump campaign and the Russian government’s effort to influence the election. Mr. Manafort was a campaign official.
THE COURT: You’re running away from my question again. You know, I’m focused on the indictment that is here.
MR. DREEBEN: Correct.
THE COURT: It involves facts and circumstances that go back as far as 2005 and come forward, Mr. Manafort’s loans from several banks that you all claim he submitted fraudulent statements — I’m asking you, and I’ve already established this investigation long predated the special prosecutor. And so what is really going on, it seems to me, is that this indictment is used as a means of exerting pressure on the defendant to give you information that really is in your appointment, but it itself has nothing whatever to do with it.
MR. DREEBEN: Well, Your Honor, I understand the question. I’m trying to explain why I think that it does have to do with our investigatory scope, and I think there are a couple of premises that may help illuminate what that investigatory scope is. The first one is that in examining an individual who was associated with the Trump campaign and did have Russian-affiliated connections, which Mr. Manafort did —
THE COURT: Are they Russian or Ukrainian?
MR. DREEBEN: Both. Mr. Manafort worked extensively in Ukraine, and he also has business connections and other connections to individuals associated with Russia. In following the leads from those things, investigators want to understand the full scope of his relationship, how he was paid, with whom he associated, what happened to the money, and that leads to the activities that are at issue in this indictment.
THE COURT: Well, it didn’t lead to that. This was given to you by the Department of Justice. The investigation was already well underway going back to 2005. Am I correct?
MR. DREEBEN: Well, I think, Your Honor, the investigation has developed considerably with the special counsel.
THE COURT: Wasn’t it already in existence in the Department of Justice, and they gave it to you when you all were appointed?
MR. DREEBEN: There were investigations that were in existence, yes, but those investigations were folded together with our overall examination of Mr. Manafort’s conduct that fits within (b)(i).
THE COURT: All right. Do you have it in front of you?
MR. DREEBEN: Yes.
THE COURT: All right. I think you would agree that the indictment that we have before the Court is not triggered by (i), which says, “any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump.” Bank fraud in 2005 and other things had nothing whatever to do with that. So then you go to number two. It says, “any matters that arose or may arise directly from the investigation.” Well, this indictment didn’t arise from your investigation; it arose from a preexisting investigation even assuming that that (ii) is a valid delegation because it’s open-ended. Go ahead, sir.
MR. DREEBEN: So I would take a different look at the way this order works than Your Honor’s description for a couple of reasons.
THE COURT: All right.
MR. DREEBEN: The first is that in provision (c) which is in the order, the special counsel is authorized to prosecute matters that arose from the investigation that is described earlier in the preamble and in (b)(i) and (b)(ii). So we are not limited in our prosecution authority to crimes that would fit within the precise description that was issued in this public order. If the investigation is valid, the crimes that arose from that investigation are within the special counsel’s authority to prosecute.
THE COURT: Even though it didn’t arise from your investigation. It arose from a preexisting investigation.
MR. DREEBEN: Well, the investigation was inherited by the special counsel.
THE COURT: That’s right, but your argument says, Even though the investigation was really done by the Justice Department, handed to you, and then you’re now using it, as I indicated before, as a means of persuading Mr. Manafort to provide information. It’s vernacular by the way. I’ve been here a long time. The vernacular is to sing. That’s what prosecutors use, but what you’ve got to be careful of is they may not just sing. They may also compose. I can see a few veteran defense counsel here, and they have spent a good deal of time in this courtroom trying to persuade a jury that there wasn’t singing, there was composing going on. But in any event, finish up this point, and then I’ll come back to the defendant.
MR. DREEBEN: Well, Your Honor, we are the Justice Department. We are not separate from the Justice Department. The acting attorney general appointed us to complete investigations and to conduct the investigation that’s described in this order. In addition, the acting attorney general has made clear in testimony before Congress that this order does not reflect the details of the matters that were assigned to us for investigation. And the word “arose” from that’s contained in (b) is not a full and complete description that’s meant to be judicially enforceable of the matters that were entrusted —
THE COURT: So it’s written by lawyers but not intended to be judicially enforceable?
MR. DREEBEN: It’s certainly not intended to be judicially —
THE COURT: I think you are better off arguing that it’s very broad and that the matters that are here are well within it. But to say that you can write a letter delegating a job to somebody but don’t pay any attention to the scope of it is not very persuasive to say the least.
MR. DREEBEN: Well —
THE COURT: What we don’t want in this country is we don’t want anyone with unfettered power. We don’t want federal judges with unfettered power. We don’t want elected officials with unfettered power. We don’t want anybody, including the president of the United States, nobody to have unfettered power. So it’s unlikely you’re going to persuade me that the special prosecutor has unlimited powers to do anything he or she wants. By the way, your office was appointed, you say, in May 2017. Is there any requirement that you make reports periodically to the attorney general?
MR. DREEBEN: Yes.
THE COURT: Does that include financial? I think you were given $10 million to begin with.
MR. DREEBEN: We have proposed a budget and had a budget approved.
THE COURT: Of $10 million?
MR. DREEBEN: I believe that’s correct.
THE COURT: Have you spent that yet?
MR. DREEBEN: I am not in a position to talk about what our budget is.
THE COURT: Are you in a position to tell me when the investigation will be over?
MR. DREEBEN: I am not, Your Honor.
THE COURT: All right. Well, I understand that, and it isn’t pertinent to what I have to decide today. And I understand your not being in a position to tell me, but I’m sure you’re sensitive to the fact that the American people feel pretty strongly about no one having unfettered power. We had an interesting judicial conference in the early ’90s, I think, on the special prosecutor, and they all appeared. I think it was at The Greenbrier. I was the chair of that judicial conference. It was a very interesting time. There were many special prosecutors who appeared, including my former constitutional law professor, Archie Cox, and others. So I had a wonderful opportunity to meet and speak to them and hear their variety of views. All right. I think you answered my questions, Mr. Dreeben. If you want to say anything else — now, of course, you’re going to have a full opportunity to respond to the defendant’s arguments, but I had some preliminary questions, which I think you’ve answered.
MR. DREEBEN: I think I should clarify one thing, Your Honor. We are not operating with unfettered power. We’re operating within a framework of regulations that contemplate regular reporting to the acting attorney general, who is supervising the work of our office within the framework of —
THE COURT: Is that Rosenstein?
MR. DREEBEN: Yes.
THE COURT: Is he not recused?
MR. DREEBEN: No. He is the acting attorney general who appointed the special counsel and who is operating in the framework of internal Department of Justice regulations. This is not the Independent Counsel Act that Your Honor was referring to in the conference that you spoke of. This is not a separate court-appointed prosecutor who’s operating under statutory independence. We are within the Department of Justice. We’re being supervised by an acting attorney general who has conferred upon us specific jurisdiction and who regularly is in a position to describe to us the metes and bounds of that. There is in this record a memorandum that he has issued on August 2 that explains that crimes that arose from Mr. Manafort’s receipt of payments from Ukraine is within our jurisdiction and was at —
THE COURT: Yes. I have that right here, and I’m glad you raised it because 75 percent of it is blocked out, redacted. Why don’t I have a full copy of it?
MR. DREEBEN: The only paragraphs that are pertinent to Mr. Manafort are the ones that are contained in this record.
THE COURT: Well, let me use a phrase that I’m fond of that I used to use with my children. I can’t use it with my wife, but I’ll be the judge of whether it relates to the others. I think you should give me under seal to be sure — and you can do it ex parte if you wish — under seal, ex parte a complete copy of the August 2, and I’ll be the judge of whether it has anything to do with Mr. Manafort.
MR. DREEBEN: Your Honor, if I could ask leave to consult with the relevant components of the intelligence community because that is a classified document.
THE COURT: Yes, of course, you may do that. If any part of it is classified, it won’t surprise you to know that a district judge is fully cleared. In fact, I have several espionage trials underway. If CIPA is needed, we will invoke it and use it. But I don’t think it will be necessary. I just want to be sure I understand it fully. What you’re telling me is that the redacted portions don’t have anything to do with Manafort or the issue he’s raised. I don’t have any reason to doubt, especially because you’re making in effect a representation, but I’m not bound by that. I need to satisfy myself. That’s why I want to know. I think it’s perfectly appropriate for you to consult with other parts of the government, particularly intelligence agencies. If they feel some of it is classified, I’m prepared to look at it ex parte under seal. We’ve got a SCIF downstairs where we put those things. So I’m fully familiar with that. You may take some time to — you can have two weeks to explore that. Now thank you. Do you have anything else at this time?
MR. DREEBEN: I just wanted to connect the dots with my reference to the August 2 scope memorandum. Even if Your Honor is not satisfied that on the face of the May 17 order the charges in this indictment are within the scope of the special counsel, the August 2 memorandum confirms the acting attorney general’s understanding both at the time of our appointment and as of the time of that memo that these crimes are within the scope of our authority. And the explanation for the greater detail in the August 2 memo is that the public order was not the place or occasion to provide details about the matters that the special counsel was to investigate. So we are not operating off the range of what the acting attorney general has authorized us to do. I would respectfully submit that under Fourth Circuit law, the regulation that Mr. Manafort is relying is not a judicially enforceable matter. I understand Your Honor’s view on that. I think we have provided case law on why we don’t think it’s a matter for judicial enforcement. Even if the Court does, we do have written confirmation that the matters in the indictment are within our scope. Thank you, Your Honor.
THE COURT: Thank you. All right. I have actually heard probably most of their argument, and I haven’t heard all of yours. You may now tell me what you think.
MR. DOWNING: Well, first of all, Your Honor, good afternoon — or good late morning. I didn’t know if you had any questions you would like me to start off with answering as opposed to just reiterating what’s in the brief, but I will say —
THE COURT: Well, I don’t want you to reiterate what’s in the brief. I’ve read that.
MR. DOWNING: Okay.
THE COURT: It’s now your opportunity to bring out what really you think is dispositive in some arresting, interesting way.
MR. DOWNING: That’s setting the bar high.
THE COURT: I reminisce a lot. The world has changed. I was a student in England in the late ’60s, and I went to many oral arguments. They didn’t use briefs at all in the cases I went to. In the House of Lords, the judges appeared in suits, and the lawyers appeared and the barristers appeared in wigs and robes. They together bent down, pulled books off the shelf, and read cases together and argued about them. I thought that was a charming but ineffective way to do things. Writing briefs is much more effective, but then it kind of renders oral argument a little more uninteresting. Tell me why — you’ve heard him say — I mean their argument is fairly straightforward. They say you look at the May 17 letter. It says any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump; secondly, any matters that arose or may arise directly from the investigation. Which I focused on their investigation rather than the Department of Justice’s, but that’s a fair point. And then the third one is any other matters within the scope of 600.4 of Title 28, Code of Federal Regulations. Then counsel appropriately called my attention to the August 2 memorandum from Rosenstein which amplifies that a bit. Of course, most of the letter is redacted, but I’m advised that that doesn’t have anything to do with Mr. Manafort. I’m going to look at that myself. But that goes on to say whether crimes were committed by colluding with Russian government officials with respect to the Russian government efforts to interfere with the 2016 election for president. That was pretty clear from the May letter. But then they go on to say committed a crime or crimes arising out of payments he received from the Ukrainian government before or during the tenure of President Viktor Yanukovych. Well, we could argue all day here and not get very much clarity on whether there’s a difference between the Ukraine and Russia. Of course, I wasn’t there any later than about 40 years ago, but if you ask the average Ukrainian, they will tell you there’s a huge difference. On the other hand, the government makes a very powerful point. Yankovych’s operation was supported by the Russian government. He did essentially what they wanted him to do, but he’s not there anymore. People are killing each other in the eastern Ukraine. My hunch is that it’s Ukrainians and Russians that are mostly fighting.
MR. DOWNING: Actually, Your Honor, we’ve spent a lot of time on this issue. For the work that Mr. Manafort was involved with with Mr. Yankovych, they were very —
THE COURT: They were very what?
MR. DOWNING: They were leaning towards getting into the European union. They were actually trying to get further away from Russia. Those were the efforts of Mr. Manafort. For today, I will say that the first comment that you had has to do with the record. You asking for an unredacted document so you can confirm what has been represented to you by the government is, in fact, true and correct, verify. So the biggest problem we’ve seen in the opposition to our motion is that this August 2 memo — I’m not sure what we would refer to it as — is the only document that’s been provided by the government to verify that, in fact, they did not violate the special counsel’s statute or the regulation. It seems very irregular for —
THE COURT: There isn’t any guidance in the statute; is it?
MR. DOWNING: No. The statute says specifically directed. Special counsel — as you know, the regs came about in a response to Congress, and a bipartisan commission decided that having a continuation of the independent counsel statute was a bad idea. They were really bad results. So the regs as adopted basically said to Congress, to the courts, and to the American public: This won’t happen again. We have a politically accountable officer of the government, the attorney general, and we have specific factual mandate if a special counsel —
THE COURT: By politically accountable, what do you mean?
MR. DOWNING: I mean someone who is senate confirmed and appointed by the president of the United States.
THE COURT: Serves at the pleasure of the president?
MR. DOWNING: Correct, Your Honor.
THE COURT: So could be fired?
MR. DOWNING: Correct.
THE COURT: Go on.
MR. DOWNING: That politically accountable officer now is the acting attorney general because of a conflict or a recusal that occurred with the attorney general. That conflict was necessary for the acting attorney general to look to the special counsel statute and say, Okay, I need to appoint a special counsel. Now, what happens next, under the regs, it says a specific factual description, which you have in .1 we would agree. And then for any additional jurisdiction, for any additional matters to be investigated, the acting attorney general, the politically accountable government official, has to grant additional jurisdiction. It doesn’t say, Sure, go ahead and do something else. It says jurisdiction because unless the acting attorney general conveys jurisdiction on the special counsel, the special counsel has no authority to act. The special counsel is very limited. He has the authority of a U.S. Attorney to the extent he’s been given specific jurisdiction and additional jurisdiction. That second part of the appointment order completely eviscerates the special counsel regulations that require that the special counsel come back to the acting attorney general, confer if he wants to expand his investigation, and then there has to be a determination made by the acting attorney general to grant additional jurisdiction. On the record we have in front of us right here, that did not happen. What we’ve asked for is for the government to produce the record. The investigation that ends up here was an investigation that was being conducted by the U.S. Attorney’s Office in the Eastern District of Virginia for quite some time. We have no record of how that investigation got transferred to the special counsel. We have no record how an investigation involving banking issues made its way to the special counsel. We only have —
THE COURT: Well, let me ask you: So what? In other words, is what you’re arguing that the use of that investigation in this case is contrary to the regulation that requires the acting attorney general here, Rosenstein, to be specific about what areas he wants investigated, and you’re saying he was too general. In this supplemental, doesn’t he remedy that in the August 2 letter?
MR. DOWNING: He can’t retroactively remedy it. The question is as of that date, what he did, does it give jurisdiction to the special counsel, or is it still so unrelated to the specific mandate as to be in violation of the regulations and the underlying statute? That’s the question. You, I think, early on got right to the point, which is this doesn’t really make any sense. This doesn’t look like it’s related. Prior cases — and there are cases that involved the special counsel — always look to is it demonstrably related. The idea here is to keep a narrow jurisdiction on the special counsel to not end up with another independent counsel. When you see (b)(ii), it looks like another independent counsel. It didn’t even require for Mr. Mueller to go back to Mr. Rosenstein if he wanted to expand under (b)(ii). It just says anything that arises or may arise. That —
THE COURT: Let’s assume for a moment your argument that this delegation is in some way illegal. Why isn’t the right result simply to give to the Eastern District of Virginia’s U.S. Attorney’s Office — give it back to them and let them prosecute this indictment? Why isn’t that the right result?
MR. DOWNING: Well, the right result may be for the Department of Justice to finish the investigation they had started and make a determination as to whether or not to charge Mr. Manafort. But if, in fact, this order is defective, then Mr. Mueller did not have the authority of the U.S. Attorney to conduct a grand jury investigation, to get search warrants, or to return and sign an indictment.
THE COURT: All right. I think I understand. Is there anything else you want me to —
MR. DOWNING: We make, I think, one point for the Court, and I think it’s an important point. The government had argued initially that these matters arose during their investigation. I think the government is now admitting, no, they didn’t. That’s a big admission, and it wasn’t in their papers. All the way up to being in court here today, I have not heard the government admit to the Court that that’s exactly what happened. It looked like —
THE COURT: What’s exactly what happened?
MR. DOWNING: That they grabbed these investigations from other components of the Department of Justice in the U.S. —
THE COURT: You say these investigations. Are you saying this indictment against Mr. Manafort?
MR. DOWNING: Yes, Your Honor.
THE COURT: All right. Go on.
MR. DOWNING: So in their papers, they’ve been arguing, oh, they came upon this during their investigation. That’s not the facts. So I’d like to make that record clear, that their arguments in their brief are absolutely erroneous. It didn’t arise during it, and I think that matters because their other argument was, well, this whole thing falls into the first specific description, which I think you’ve pointed out: In no way does it make any sense that it falls into the first description. Then finally, when you go and look at Mr. Rosenstein’s memo, it’s very odd for when it occurs, but the most obvious omission from it is it does not say “as we agreed” or “as we discussed.” It just puts something in a point in time with no relation back to what happened on or before May 17. And just one other issue. The government continues to refer to these regulations as no different than something that would be in the U.S. Attorney’s manual or a written policy. Obviously, the Department of Justice for some time and the attorney general decided to make these special counsel regulations. They didn’t make it a policy. They didn’t make it a procedure. They didn’t put it in the U.S. Attorney’s manual. They made it a regulation, and they did it publicly to say to the country, to Congress, and to the courts and the land that this is how we’re going to conduct ourselves. The attorney general certainly at points in time could have taken that right back, but he never did. He left it on the books. They promulgate that these regs are controlling the office of this special counsel in a public notice, their appointment order. So they tell the world: Don’t worry about it. We’re not going to end up with this runaway special counsel like we’ve seen with the independent counsel. When they come to court, they say, By the way, these are not judicially enforceable. It’s as if they hoodwinked the entire United States into thinking that this was going to be different than the independent counsel. I think it’s very important for the government to be held accountable just like the government was and the Department of Justice was in U.S. v. Nixon. You put these regulations out there. You’re telling the world. You’re telling the government. You’re telling the United States citizens: You can rely upon us conducting ourselves in this manner. Then when they don’t and they don’t produce a record, they say to this Court, they say to Manafort, they say to the country: Guess what? It’s not enforceable. And I don’t think that can stand, Your Honor.
THE COURT: All right. Let me hear your response. You’ve already made most of it, but repeat what you feel is necessary.
MR. DREEBEN: Thank you, Your Honor. Let me try to make four quick points and answer any questions that the Court may have. First, Mr. Manafort’s counsel treats the May 17 order as if it is the specific factual statement that’s contemplated by the special counsel regulations. It is not. The regulations nowhere say that a specific factual statement needs to be provided publicly, and in the context of a confidential, sensitive counterintelligence investigation that involves classified information, it would not make any sense for that information to be conveyed publicly. Mr. Manafort actually acknowledged that in argument on this issue before the district court in the District of Columbia. The specific factual statement, as Attorney General Rosenstein described in his Congressional testimony, was conveyed to the special counsel upon his appointment in ongoing discussions that defined the parameters of the investigation that he wanted the special counsel to conduct. So it is not really appropriate to assume that the (b)(i) description is the factual statement that the regulations contemplate.
THE COURT: Well, I understand your argument, but let me characterize it and see if you find it as satisfying as you appear to indicate that you think it is: We said this is what the investigation was about. But we’re not going to be bound by it, and we weren’t really telling the truth in that May 17 letter. I don’t watch pro football, but I used to enjoy the program that came beforehand where a bunch of players would get on and essentially make fun of everybody. But they would put on some ridiculous thing, and then they would all say in a chorus, Come on, man. I loved that. I thought that was great. So your argument that we said this was the scope of the investigation but we really didn’t mean it because we weren’t required by any law or regulation to say what the scope was, I understand that argument, but it kind of invites, Come on, man. You said that was it. But I think your argument goes on, and you say, Look, the May 17 letter isn’t the end of it. There is the August 2 letter, and in the August 2 letter, it’s expanded considerably because it then says — Russian government is number one, and then it goes on to the Ukrainian government which is never mentioned beforehand. Who knows what else, of course, went on? In any event, I wanted you to be clear how I understand that particular argument.
MR. DREEBEN: Can I take a shot at explaining why I don’t think that’s the accurate way to look at it?
THE COURT: Of course you may.
MR. DREEBEN: So we’re dealing here with a national security counterintelligence investigation that had been conducted by the FBI that had numerous different aspects to it that were —
THE COURT: Are you telling me that in this indictment that’s before the Court on Mr. Manafort, that I’m going to have to go through CIPA, that there’s going to be a Section 4 filing, that there will be classified documents, they’ll have an opportunity to say what they need to say, etc., etc.?
MR. DREEBEN: I hope not, Your Honor. I was trying to describe the overall –
THE COURT: Well, you’re making a big deal out of it being a classified kind of thing. If that’s in any way relevant to his defense, there we go with another CIPA. I have been through CIPA cases going way back to John Walker Lindh and other matters. If that’s what’s going to happen, I’d like to have notice of it. You all could drag this out. I’m an old man. You could actually outlive me.
MR. DREEBEN: I’m not trying to do that, Your Honor.
THE COURT: This proceeding could outlive me. In fact, if a lot of lawyers around here had their way about it, they would take steps to ensure that almost everything outlived me.
MR. DREEBEN: Let me try to be brief.
THE COURT: All right, sir. That’s welcome.
MR. DREEBEN: The May 17 order could not fully describe the matters that the acting attorney general wanted the special counsel to investigate because they implicated people who were under investigation but who may never be charged and sensitive national security matters. As a result, the specifics of the investigation were conveyed to us not on the face of the May 17 order but in interaction with the acting attorney general. He explained this in his testimony in just these terms, simply could not be made public. I think Your Honor would agree that it’s not appropriate for the government to disclose specific subjects of an investigation when those matters may never result in a charge and when they could jeopardize ongoing criminal investigations, as well as reveal national security matters. That was the only point that I was trying to make one. (b)(i) is not the factual statement.
THE COURT: All right.
MR. DREEBEN: The second point here is that we are within the Department of Justice. To the extent that Mr. Manafort is suggesting that we’re analogous to the independent counsels that operated under the old statute, that’s not right. Our indictment was reviewed and approved by the Tax Division, by the National Security Division. We operate within a framework of the Department of Justice. We’re not different from the U.S. Attorney’s Office in that respect. We’re all part of the same Department of Justice.
THE COURT: You resisted my suggestion to have someone here, and Mr. Asonye showed up. When did you ask Mr. Asonye to join you? By the way, don’t nod or shake your head out here because it interrupts the speaker. It’s rude, and it has often the opposite effect you may — I was never able to do that by the way. When I was sitting where you are, I nodded and shook my head all the time. Despite the fact that it aggravated judges, I did it, and I regret that. My perspective is a little different now. I expect you to do what I was unable to do. Don’t worry about it. It’s not a big deal. Go ahead.
MR. DREEBEN: Thank you, Your Honor. We took your admonition to heart, and we are very happy to have Mr. Asonye join us.
THE COURT: Good. I think that’s important for communications as well. Plus, you never know. If you have to try this case, you will have to try it before me. Mr. Asonye has some experience here. Is that right, Mr. Asonye?
MR. ASONYE: Yes, Your Honor.
THE COURT: And before me as well.
MR. ASONYE: Yes, Your Honor.
THE COURT: So he can tell you some interesting things.
MR. DREEBEN: Two more quick points with leave, Your Honor.
THE COURT: Yes.
MR. DREEBEN: First, Your Honor referred to the fact that there were ongoing investigatory matters that concerned Mr. Manafort before the appointment of the special counsel, but the investigation that the special counsel has conducted has considerably advanced and deepened our understanding of the matters that have been previously identified. So it is not entirely fair to say that the matters in the indictment did not arise from the investigation or could not have arisen from it because our investigation —
THE COURT: It factually did not arise from the investigation. Now, saying it could have arised under it is another matter, but factually, it’s very clear. This was an ongoing investigation. You all got it from the Department of Justice. You’re pursuing it. Now I had speculated about why you’re really interested in it in this case. You don’t really care about Mr. Manafort’s bank fraud. Well, the government does. You really care about what information Mr. Manafort can give you that would reflect on Mr. Trump or lead to his prosecution or impeachment or whatever. That’s what you’re really interested in. You know, when a prosecutor is appointed, he’s appointed to get an indictment. He’s appointed to go after somebody. Somebody mentioned to me not long ago that this is a different scheme, that it’s not the scheme that was in effect in the ’60s and ’70s. That’s true, but I suspect the change in this process is not significant. It’s still the same. It’s still the same. You appoint a prosecutor, and that prosecutor goes after with the intent — whether it was Clinton or whoever else it was, Reagan or whoever, they go after him with the idea they’ve got to get an indictment. If they don’t, they’re very unhappy. I remember speaking to one special prosecutor, the Iran-Contra thing, and he was terribly disappointed. That’s what prosecutors do. I understand that. The Brits use a different system. They don’t use special prosecutors. They use a commission to go out and investigate it and write a report, and then people sort of accept that. In this country, I don’t think a commission could do the job you all are doing. It doesn’t have the power to subpoena. It doesn’t have the power to impanel a grand jury, etc., etc. I understand that, but it sure is less disruptive. In any event, your point, if I can distill it to its essence, is that this indictment can be traced to the authority the special prosecutor was given in the May and August letters. That, as far as you’re concerned, is the beginning and end of the matter.
MR. DREEBEN: Yes, Your Honor, it is the beginning and almost the end. And this is my last point, I promise.
THE COURT: All right.
MR. DREEBEN: The special counsel regulations that my friend is relying on are internal DOJ regulations. He referred to them as if they’re a statute. I want to be clear. They are not enacted by Congress. They are internal regulations of the Department of Justice.
THE COURT: Most regulations aren’t enacted by Congress. They’re promulgated by agencies pursuant to rule-making authority.
MR. DREEBEN: Correct.
THE COURT: Congress doesn’t do it.
MR. DREEBEN: Correct. But he referred to them as a statute. I just wanted to be clear we’re —
THE COURT: Yes, I’m clear about that. I’ve learned a few things.
MR. DREEBEN: The fourth, they conclude in a provision that’s applicable here, 600.10, by describing that these rules and regulations are not intended to create any rights that can be enforced by individuals in any proceedings, civil or criminal.
THE COURT: Yes, I have that in front of me.
MR. DREEBEN: The reason for that is that this is a way for the Department of Justice to organize its investigatory and prosecutorial actions. It’s no different than the acting attorney general assigned a matter to the Eastern District of Virginia or assigned it to a component of the Department of Justice. It’s not there for the benefit of individual —
THE COURT: Of course, the difference is that if you did assign it to the Eastern District of Virginia, it wouldn’t come, Mr. Asonye, with a $10 million budget; would it?
MR. DREEBEN: Your Honor —
THE COURT: Look, I take your point on 600.10, that it doesn’t create any rights, but that’s a little bit like arguing, look, we issued these internal things but don’t expect us to be bound by them. I think your stronger argument is you complied with them.
MR. DREEBEN: I agree that is a strong argument.
THE COURT: It’s not a very strong argument to say, Don’t hold us to it because we didn’t mean it. We said it, but we didn’t mean it.
MR. DREEBEN: Can I refer the Court to a Fourth Circuit case that interpreted very similar language and concluded that it was not enforceable in a court?
THE COURT: Yes, of course.
MR. DREEBEN: We cited this case in our brief. It is In re Shain. It’s 978 F.2d 850. It’s a 1992 decision of the Fourth Circuit, and it concerned the media subpoena regulation that the department has, which it has established in order to put a buffer zone around subpoenas that may go to the media. It’s not required by the First Amendment but reflects the Department of Justice’s internal sensitivity to seeking information from the media. The litigant in that case claimed that the department had violated that regulation, issued a subpoena that wasn’t authorized by it, and the Fourth Circuit concluded that this was an internal DOJ regulation. It contained language very similar to 600.10, and the Fourth Circuit held, This is not a matter for courts to enforce. It’s an internal DOJ matter. Respectfully, Your Honor, although we fully agree that we are authorized to conduct this investigation and there’s no basis for dismissing the indictment, I would also refer you to this case.
THE COURT: Wasn’t there a matter in New York recently that the special counsel returned to the Southern District of New York?
MR. DREEBEN: The special counsel’s office did refer certainly allegations concerning an individual to the Southern District.
THE COURT: Why did it do it?
MR. DREEBEN: With respect, Your Honor, I’m not at liberty to go into the internal prosecutorial matters within the Department of Justice.
THE COURT: Let me ask you this: Did it do it because it concluded that it had uncovered materials that really weren’t within the scope of what it was authorized to look into, or did it do it because, well, we’re not interested in it because we can’t use this to further our core effort, which is to get —
MR. DREEBEN: Let me try to answer Your Honor’s question this way —
THE COURT: — to Trump?
MR. DREEBEN: — because I want to be responsive and at the same time respect internal investigatory equities.
THE COURT: I’m not asking you to disclose anything that you can’t disclose.
MR. DREEBEN: We take very seriously the primary mission that was assigned to us by the acting attorney general in the May 17 order, which is to investigate, not prosecute necessarily unless there’s a prosecutable crime, but to investigate Russia’s interference with the 2016 presidential election and links or coordination that may have occurred with individuals associated with the campaign of President Trump. We are focused on that mission. We may uncover other criminal activity in the course of that that is necessary for us to investigate in order to complete that mission. We may uncover criminal activity that is not necessary for us to investigate but is still appropriately investigated by a different component of the department. We have sought to respect that line. We have consulted with the acting attorney general in order to make sure that we are operating within —
THE COURT: All right. That’s helpful. But it brings me back to a point that I don’t know that we adequately plumbed, and that is why in New York did you feel that it wasn’t necessary for you to keep that but it is necessary for you to keep this which involves bank fraud and registration and other things dating back to 2005, 2007, which I think manifestly don’t have anything to do with the campaign or with Russian collusion? You’re keeping one and giving up the other. I don’t see the difference. I think one answer you could tell me, and I want to say it because I think you would properly be a little reluctant to do it. It is this: It’s none of your business, Judge, why we did that. We’re going to proceed on that. Well, I think that’s a fair point to make. I’m not sure it’s none of my business because I don’t have yet a full understanding of everything, but why is New York different? And if you can’t tell me, I accept that.
MR. DREEBEN: Well, Your Honor, I think I can be helpful to you about this case. In this case, Mr. Manafort clearly is within the area of investigation because of his affiliation with the campaign of President Trump and because of his affiliations in Ukraine with Russia-associated individuals. Once a prosecutor —
THE COURT: Suppose you found a crime that he committed — let’s say the statute of limitations was 20 years ago. Would that permit you to go after him and use it to coerce him or put pressure on him to turn on others or Trump himself?
MR. DREEBEN: If it’s not factually linked to the subject of the investigation, then we would go back under the regulations if we thought it was appropriate for us to investigate and have the acting attorney general decide that, but here the crimes —
THE COURT: Can you tell me how these things in the indictment are factually linked to Russian influence over the 2016 election?
MR. DREEBEN: They’re factually linked to the areas of our investigation because in trying to understand the activities of Mr. Manafort in Ukraine and associations that he may have had with Russian individuals and the depth of those, we needed to understand and explore financial relationships and to follow the money where it led. So the logic of the investigation has factual connections to the indictment. I think in Your Honor’s hypothetical, that would not have been so, and that’s the fundamental difference.
THE COURT: All right. I might mention to you that I’ve gone through the indictment, as you would expect me to do. There’s no mention in the indictment that I know of that refers to any Russian individual or any Russian bank or any Russian money or any payments by Russians to Mr. Manafort. Correct?
MR. DREEBEN: I think that is correct, but the money that forms the basis for the criminal charges here, the tax charges, the bank fraud charges comes from his Ukraine activities. That’s what we were focused on. So we followed the money into the transactions that led to the criminal charges here, and it’s that factual link that connects the subject of the investigation in —
THE COURT: You can’t be talking about bank fraud because that’s not where money came from. That’s getting money from a bank without telling the truth, but it could be in the false income tax. Is that what you’re suggesting?
MR. DREEBEN: It’s both, Your Honor, because the Ukraine money was used to purchase and improve real estate. The transactions that are charged as bank fraud extracted that money and made it —
THE COURT: Purchases of his homes.
MR. DREEBEN: With money that he derived from the Ukraine activities we’ve alleged. That’s the factual connection, Your Honor. I’m just trying to explain why we regard this as connected to our investigation.
THE COURT: All right. Thank you.
MR. DREEBEN: Thank you.
THE COURT: Do you have anything else to add?
MR. DOWNING: Just briefly, Your Honor. The one thing we would ask this Court to do before deciding the motion before the Court is to ask the government for what anybody who has had any experience with the Department of Justice knows exists, which is the written record. Where is the written record before Mr. Mueller was appointed? Where is the written record about the decision —
THE COURT: What do you mean by the written record?
MR. DOWNING: Mr. Rosenstein had a process he had to go through in order to determine that there was a conflict that gave rise to the appointment of special counsel, the specific matter that the special counsel was going to investigate in any additional jurisdiction he granted. It would all be written down somewhere. That’s how the Department of Justice works. Mr. Rosenstein even conceded when he was testifying up on the Hill and he was confronted with the question of, When did you expand the jurisdiction to the special counsel? He couldn’t or wouldn’t answer the question, but he did say very tellingly, I will go back and check my records, and I will get back to you. So we would ask that this Court order the government to turn over those records so that the Court doesn’t have to guess what happened.
THE COURT: What records is what I’m asking you.
MR. DOWNING: Well, Mr. Rosenstein referred to records.
THE COURT: In his testimony?
MR. DOWNING: Correct.
THE COURT: What records are you referring to? That is, what kinds of records?
MR. DOWNING: Well, Your Honor, generally —
THE COURT: Are you suggesting that Rosenstein had to go through some process to conclude that there was some conflict before the Department of Justice could proceed?
MR. DOWNING: Which he also testified to.
THE COURT: All right. Is that what you’re — the record of identifying the conflict?
MR. DOWNING: I believe identification of the conflict, the matter that needed to be referred to a special counsel in order to — because of the conflict and the scope of the special counsel’s investigation, including any additional jurisdiction.
THE COURT: The May and August letters are the scope.
MR. DOWNING: That’s after the fact. You would expect that the Department of Justice, especially Mr. Rosenstein, would have had a memo before.
THE COURT: Why do you say that?
MR. DOWNING: Because in the Department of Justice generally, just in any situation —
THE COURT: Did you serve in the department?
MR. DOWNING: Fifteen years, five of which was under Mr. Rosenstein’s management. Mr. Rosenstein is a stickler for memos being written, for there to be a written record for the actions of the Department of Justice.
THE COURT: What good would that do me if I had all of that in front of me?
MR. DOWNING: It might show you exactly whether or not Mr. Rosenstein violated the regs or whether he complied with them.
THE COURT: I don’t know about regulations, but let’s suppose he violated. Of course, counsel has already pointed out that that’s, in his view, irrelevant. But let’s suppose it shows that, that Rosenstein didn’t do a good job. So what?
MR. DOWNING: So our position is that to the extent that Mr. Rosenstein exceeded his authority to appoint a special counsel, the special counsel does not have the authority of a U.S. Attorney.
THE COURT: Thank you.
MR. DOWNING: Thank you.
THE COURT: All right. I’ll take the matter under advisement. Did you wish to respond to this last point?
MR. DREEBEN: No thank you, Your Honor, unless you have any questions.
THE COURT: Good choice on your part. I must tell you that I’m exercising uncharacteristic restraint on my part not to require you to tell me about those things, but I think I have an adequate record now. You’re going to let me know in two weeks the rest of this letter. I’m going to be interested if CIPA really is invoked. That creates a whole new regime for the treatment of discovery and so forth, as you all well know. Thank you for your arguments. They were entertaining. I think I found the right adjective. Thank you.
Mr. Asonye, I’m glad to see you here.
MR. ASONYE: I’m glad to see you as well, Your Honor.