By Matthew Russell Lee, Pod Exclusive Patreon
BBC - Guardian UK - Honduras - The Source
SDNY COURTHOUSE, June 16 – Virgil Griffith, charged with violating North Korea sanctions in connection with a crypto-currency conference there, now faces trial in September 2021 in the U.S. District Court for the Southern District of New York.
This emerged at a telephone conference in the case on December 22. Griffith's defense lawyer Brian E. Klein spoke among other things about filings not yet placed in the public docket, only emailed to SDNY Judge P. Kevin Castel.
On February 11, Judge Castel held a proceeding about who knew what before and at the conference Griffith spoke at. A stipulation or agreement has been proposed, essentially that some people know, but the DPRK / Kim government as such did not. Inner City Press live tweeted the first proceeding, here.
And on February 23 the second proceeding, in two parts, here.
On June 16, Griffith's lawyers complained that "the defense is still awaiting the completion of the government's review and production... the Government filed a letter correcting a 'mistake' it had made regarding its presentations to the Court about the FBI's first interactions with OFAC... The defense hopes that the prosecutors will honor their commitment to a June 22, 2021 deadline. If not, the defense reserves its right to seek relief from the Court." Watch this site.
Back in March 12, citing the swearing into the office of US Attorney General of Merrick Garland the day before, the US Attorney's Office has asked for a three week delay for its Classified Information Procedures Act filings, since Garland must sign them on personal knowledge, under US v. Aref. Others might wonder if the change in Administration might result in a changed prosecutorial stance in this and certain other cases. But, three weeks - granted on March 15:
"MEMO ENDORSEMENT as to Virgil Griffith on re: [103] LETTER MOTION filed by USA addressed to Judge P. Kevin Castel from AUSAs Kimberly Ravener & Kyle Wirshba dated March 12, 2021 re: CIPA Motion Schedule. Pursuant to CES's instructions, the Government respectfully requests that the Court extend the date of its CIPA motion until April 9, 2021. ENDORSEMENT: OK. Application Granted. So Ordered: (Signed by Judge P. Kevin Castel).
The US and Virgil Griffith's lawyers disagree on how to describe the crypto knowledge of North Korea at the time of the conference Griffith spoke at. They seem to agree that some officials knew - but did "the DPRK government"?
Meanwhile, Griffith has requested loosening of pre-trial release conditions, including use of a Kindle, emailing with people other than his lawyers, and termination of drug testing. Full letter on Patreon here.
Assistant US Attorney: There were statements by Mr. Griffith to the FBI about what the conference attendees understood about crypto currencies. That evidence must be allowed, and would not fall under the Court's proposed stipulation.
Judge Castel: I did not think the language in the stipulation would preclude that - otherwise there's no case here and we all go home. Some at the conference did not have this knowledge - that's the premise of the US' services argument.
Judge Castel: I assume if the US agreed that everyone at the conference knew in advance about what Mr. Griffith presented, the US would be consenting to dismiss the indictment. Griffith's lawyer: We would like that. But we need time to consider the stipulation.
AUSA also wants to confer- with DC? Judge Castel signs off on agreed bail modifications: Kiddle, e-mail, no more drug testing. There may be more.
On February 16, there was another proceeding. But the parties were still negotiating. Inner City Press live tweeted here:
AUSA Kyle Wirshba says government is negotiating some points with the defense, which agrees. Judge Castel put the proceeding over for next Tuesday at noon.
Griffith's lawyer says he'll be filing a motion Tuesday as well. Asks when trial date is.
Judge Castel: On Friday submissions were made for second quarter. For requested September trial in Griffith case, request will be put in sometime in April.
Inner City Press will continue to report on this case.
Here was a proposed stipulation: "The Government proposes the following stipulation: The Government is not arguing in this case that the information that the defendant allegedly provided and intended to provide at the Cryptocurrency Conference held in Pyongyang in April 2019 was above and beyond the then-existing capabilities and knowledge of at least certain individuals within the government of the Democratic People’s Republic of Korea. The defense proposes the following stipulation: Any information that Mr. Griffith disclosed or provided during his time in North Korea in April 2019, including at the Cryptocurrency Conference held in Pyongyang, was previously known to, and accessible from, the Democratic People’s Republic of Korea. The parties shared their proposals with each other, conferred regarding their respective positions, and determined that an agreement could not be reached." Full letter on Patreon here.
On January 12 Klein filed multiple exhibits, with many redactions. Inner City Press is reviewing them but for now can first report there's an email from Brandon M. Cavanaugh of the FBI to three redacted recipients, that "Hey sir. Its [REDACTED.] However, DOJ asked us to hang on on reaching out to OFAC. Apparently, one or more people have already reached out to [REDACTED] and he's becoming frustrated. Just wanted you to be aware of the sensitivity." Watch this site.
Inner City Press, which has covered the case from Griffith's first appearance in the SDNY Magistrates Court to his Christmas 2019 holiday legal moves to get released to home confinement in Alabama, has previously successfully sought sealed documents in this criminal case, see below. Dec 22 podcast here. It live tweeted the December 22 arguments, here and below.
On December 30, the parties agreed the Griffith case can be tried in September 2021, specifically September 7: "Re: United States v. Virgil Griffith, 20 Cr. 15 (PKC) Dear Judge Castel: The parties submit this letter in response to the Court’s December 22, 2020 order to advise on whether there is any reason why the “the Court ought not seek a date for commencement of trial on or after September 7, 2021 and before September 30, 2021.” ECF No. 82. The parties have conferred and identified no reason why the case cannot be tried on or about September 7, 2021 and within the window identified by the Court. Defense counsel, however, request the date of September 7, 2020 because Mr. Buckley has a federal criminal trial in Chicago, United States v. Gregg Smith, 19 Cr. 669 (EEC) (N.D. Ill.), currently scheduled to commence on October 18, 2021." Watch this site.
After-hours on December 28 the SDNY prosecutors admitted another errors, like in the Iran/Nejad and other cases - and belated promised to give the defense - but not the public - the information they withheld and mis-represented, see more on Patreon here: "Re: United States v. Virgil Griffith, 20 Cr. 15 (PKC) Dear Judge Castel: The Government respectfully submits this letter to correct a factual error at the December 22, 2020 argument. The Government apologizes to the Court and counsel for the mistake. The Court inquired at the argument about the initiation of communications with the Office of Foreign Assets Control (“OFAC”) regarding “Virgil Griffith’s activities in North Korea.” (Tr. 42 (enclosed as Exhibit A)). The Government responded that the first contact between prosecutors and OFAC occurred on November 19, 2019, and that there were additional communications “between the FBI and another employee of OFAC” in “October of 2019.” (Id.). The Government later specified that “October 24[, 2019,] is the initiation of conversation between OFAC and the FBI.” (Tr. 48; see also Def. Reply Ex. G). Based in part on those representations, the Court ruled at the argument that the Government must “do a Brady review with OFAC that begins as of October 24, 2019, with the initiatory conversation between an FBI agent and someone at OFAC . . . for any Brady materials in OFAC’s possession on or after that date.” (Tr. 50-51). Following the argument, the Government re-reviewed communications it has collected to date and realized that the FBI began to communicate with OFAC regarding topics that are relevant to this case on August 5, 2019. To address this error and related difficulties in identifying the onset of communications with OFAC prior to undertaking the review, the Government will request from OFAC—without date limitation— any materials relating to Griffith and the 2019 Cryptocurrency Conference in Pyongyang, including participants such as the coconspirators described in the Complaint, and any materials relating to witnesses for the Government at trial. Based on that review, the Government will make any necessary disclosures or proceed, with notice to defense counsel, under the Classified Information Procedures Act." More on Patreon here.
Judge Castel: This is a case with a single count, of conspiracy to violate the law, the IEEPA, not the substantive charge. That may have consequences. The president at the time, President Obama, barred export of goods and services to the DPRK [North Korea]
Judge Castel: I'm looking at an email from Matthew McKenzie, it says "the basis for Griffith's presentation was publicly available info does not undermine the conclusion" that it violated the law. He packaged the info for the DPRK audience
Judge Castel: They traveled to a country where sale was blocked. They agree they are going to endeavor to sell the blocked weapons discussed at the Paris Air Show [this is a hypothetical]. Perhaps you could speak to that? Griffith's lawyer: Hypotheticals are hard
Griffith's lawyer: We're talking about publicly available technology, not weapons. Judge Castel: What if the conference was just a prelude, but there'd be follow through, to transfer info tailored for the DPRK? Griffith's lawyer: That does not fit this case
Griffith's lawyer: The government here is restricting speech. We're encouraging the court to apply strict scrutiny... We had a whole string cite about intangible goods and services. We think the indictment should be dismissed. AUSA Ravener: We specify the services
AUSA Ravener: We cite Griffith pitching his company to the conference attendees. He was offering crypto-currency services.
Judge Castel: Did this conspiracy end, having achieved its purposes by the time Mr. Griffith departed North Korea airspace? Or was it longer?
AUSA Ravener: He followed up, that he'd like to find an emissary to make the crypto-currency exchange. At the conference he identified himself as working for the Ethereum Foundation. He said, we can give you contracts that don't go through the US
Judge Castel: He was a senior research for the Ethereum Foundation. That was essentially a marketing position. Did Ethereum Foundation provide services to others? Or just promote the Ethereum blockchain? AUSA Ravener: We would have to conduct further investigation
AUSA Ravener: Ethereum deals in Ether, that's potentially a service. We have evidence that Mr Griffith spoke with individuals at Ethereum about this ideas of providing services to North Korea. He was admonished not to go. But he went anyway.
Judge Castel: Usually the US has no problem showing the guilty hand, they have problems with showing the guilty mind, mens rea. Here maybe the government can show guilty mind - but you still have to show the guilty hand, the actus reus. AUSA: We'll show at trial
AUSA Ravener: He created a bespoke presentation for the DPRK. It's clear he had done so in coordination with the DPRK. He was the keynote speaker. It's out of the information materials exemption in the OFAC regs
Judge Castel: My understanding of the exemption is that it is not precluded just because the audience didn't know the information. AUSA: He create a pitch how the info could be used to evade sanctions. And he pitched his own financial services processing services.
AUSA Ravener: We believe he tried to acquire domain names like http://blockchain.kp or http://crypto.kp, to enter this market... Judge Castel: So you say the conspiracy continued to December 2019.
Griffith's lawyer: If he gave this speech at Columbia University and it's allowed under the First Amendment, then it's allowed here. Part of a pitch? That is not in their briefs. With respect to Ethereum Foundation, they want to have it both way. He was on leave
Griffith's lawyer: Ethereum is not a company. It's a blockchain. Judge Castel: I got it. The Foundation supports the blockchain. But Mr. Griffith received a paycheck or something from the Ethereum Foundation to promote the blockchain
Judge Castel: How does doubt by OFAC about whether it's a violation of law do anything for the defense? Griffith's lawyer Brian Klein: They asked OFAC for a determination to allow the arrest, and for a witness for the trial. So the OFAC doubts come into play. AUSA Wirshba: We'll be turning over 3500 material.
Griffith's lawyer Klein: I'm glad to here that. We want to know what OFAC said. They are also relying on Chevron deference. We need access to these records. They need to review it for Brady material. [See Rule 5f]
Griffith's lawyer Klein: We'd like to know OFAC's view of DPRK's crypto currency capability. Judge Castel: My library could have that info, but they can't get it in North Korea, and in DPRK they don't have Google searches. Klein: We think some in DPRK have Google
Griffith's lawyer Klein: We believe North Korea already knew a lot before Mr. Griffith's alleged speech. Judge Castel: You may want to ask to know the identity of all witnesses, like in any drug conspiracy case in this courthouse. The ID of cooperators.
Griffith's lawyer Klein: We need the identity of the witness. Judge Castel: That's usually not given, at least in drug cases. Now he cites the Middendorf factors - Inner City Press covered that case, here
Judge Castel is back to the McKenzie email. AUSA: That was the first contact before our Office and OFAC's counsel office. There were discussions between the FBI and OFAC, in October 2019. Another call in November.
Judge Castel: What about Witness Number 2? AUSA: The government is withholding only limited information. Griffith's lawyer Klein: Before Judge Broderick, another prosecutor said everyone in the DPRK works for the government.
Griffith's lawyer Klein: A jury should know that people in North Korea have info about crypto currency. We should get the info now, we are entitled to it or to a broad stipulation.
Judge Castel: There's more merit to that. I'm going to address that in my ruling
Griffith's lawyer Klein: This is the first we're hearing about a call between FBI and OFAC -- Judge Castel: But you got notice of that in writing, Tab G, in your possession. Griffith lawyer Klein: The AUSA spoke about another call, too [He did]
Judge Castel (with a ruling tone of voice) - The communications between the FBI and OFAC began in October 2019. When the prosecution conducts a joint investigation, courts in this circuit have held they must review the other agency's material for Brady material
Judge Castel: My colleague Judge Oetken set forth a very useful test in Middendorf. But it does not completely fit here. OFAC interprets its own regulations. So now a Brady review is required, from October 2019 onward
Judge Castel: With regard to Witness Number 2, the case law is that nothing obligates the government to disclose the identity of its witnesses before trial. I understand that a redacted version of Witness 2's statement has been provided.
Judge Castel: The government says that Mr. Griffith's supporters will try to help him. So I am withholding the identity to protect the witness [!] I'm going to reserve decision on materials about DPRK's crypto capabilities. The parties may wish to stipulate on this
Judge Castel proposes a trial date: after Labor Day 2021. Klein: I want to discuss that with my client. We intend to ask for loosening of restrictions - he has been without Internet. Judge Castel: Each side should write to me why Sept 7, 2021 trial doesn't work
Griffith's lawyer Klein: We will put in a letter on loosening restrictions. Judge Castel: It's one thing to have a case with tough issues. But it's a joy to a judge to have lawyers that can answer questions. It has been helpful. Peaceful holidays to Mr. Griffith
On exclusion of time under Speedy Trial Act, Klein said he'd like to speak with Griffith; his other lawyer Mr. Buckley said March makes sure. Judge Castel: I exclude time to Sept 7, this is not a run of the mill case. Adjourned
Update: after publication of the above, this order: "ORDER as to Virgil Griffith. Defendants motion to compel discovery of material in the possession of OFAC is GRANTED to the extent that the government is directed to conduct a review of material in the possession of OFAC for the period from October 24, 2019 to the present that is related to Mr. Griffith's prosecution; the government shall disclose any materials that must be disclosed to the defendant consistent with the governments obligations. Defendant's motion to compel discovery of the identity of the individual identified as Witness 2 is DENIED. The Court defers ruling on defendants motion to compel a search of files of certain government agencies regarding the cryptocurrency and blockchain capabilities of the DPRK. The parties shall meet and confer on a stipulation. The proposed stipulation shall be submitted to the Court no later than January 25, 2021. The parties are directed to submit a letter to the Court by December 30, 2020 setting forth any reason why the Court ought not seek a date for commencement of trial on or after September 7, 2021 and before September 30, 2021. A conference is set for September 7, 2021 at 9:30 am in Courtroom 11D 500 Pearl Street, New York, NY. For reasons stated on the record, time is excluded in the interest of justice under the Speedy Trial Act through September 7, 2021 to allow both sides to discuss a resolution of this matter and review discovery Time excluded from 12/22/20 until 9/7/21. (Signed by Judge P. Kevin Castel on 12/22/20)(jw) "
Back on November 10, Inner City Press went in person to the proceeding in Judge Castel's Courtroom 11D. It was alone in the gallery; in the front were the three ASUAs, Mr. Buckley for Griffith, and on the side CISO Hartenstein, who performs the same role in the CIA leaks case US v. Joshua Schulte.
The government said it won't make its CIPA motion under March 19. Buckley point out that is more than a year after Griffith was arrested, and that Griffith is seeking FBI and other information.
Judge Castel replied that he will bring the parties in on December 22. He said the public portion of the CIPA Section 2 conference was over; he told Mr Buckley he did not have to wait around (and Inner City Press, by implication, either). But what are the rights of the press and public with respect to these CIPA sealings?
Earlier in the case: Judge Castel to his credit the same day asked each side's counsel to respond: "The Court has received an application from Inner City Press for the unsealing of certain applications by the defendant for the issuance of subpoenas. The parties shall respond to the application by May 22, 2020. If there is no objection, the Court will order the applications and any resulting order unsealed."
On May 29, Judge Castel ruled: "Defendant is directed to file forthwith on ECF his ex parte and in camera applications for subpoenas pursuant to Federal Rule of Criminal Procedure 17. (Signed by Judge P. Kevin Castel on 5/29/2020) (ap)."
And now they have been filed: a March 17 letter and affirmation, and the subpoena itself, for "A list of any and all IP addresses associated with the email address dprk.un@verizon.net, and any logs or similar records of access to the email address dprk.un@verizon.net, for the period from November 1, 2018 to October 30, 2019."
Inner City Press has uploaded the application, affirmation and subpoena on Patreon here.
An aside: the application of diplomatic immunity and/or the Vienna convention to this subpoena, and Verizon's response to it, remain UNclear.
On June 1, Griffith's lawyer filed a motion to dismiss for lack of venue, stating that Griffith's email to the North Korea Mission in New York, responded to, might not have been "received" in New York. Inner City Press is tweeting the photo here. Watch this site.
On May 28, from Judge Castel again to his credit, this: "ORDER as to Virgil Griffith. The government advises that the defendant consents to public disclosure of his ex parte and in camera application for a subpoena pursuant to Federal Rule of Criminal Procedure 17 (the Application) but does not consent to advance disclosure of the Application to the government. To enable the government to intelligently state its position on public disclosure, defendant shall transmit the Application to the government by 1 p.m. today, May 28, 2020. The government shall state whether it has any objection to public disclosure by 1 p.m. on May 29, 2020. The Court will thereafter rule on whether the Application should be publicly filed (Signed by Judge P. Kevin Castel on 5/28/20)(jw)." Watch this site.
The case is US v. Griffith, 20-cr-15 (Castel).
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