By Matthew Russell Lee, Patreon Video Podcast
BBC - Guardian UK - Honduras - ESPN
SDNY COURTHOUSE, Sept 15 – Just after the indictment of electric vehicle maker Nikola's founder Trevor Milton was unsealed on July 29, 2021 a press conference was held in the Southern District of New York prosecutors' office. Inner City Press went and asked about the SEC complaint's reference to Milton targeting "Robinhood investors." Video here.
US Attorney Strauss and her SEC colleague (on the job for all of one week) both deferred comment on particular companies or phenomena like Robinhood, or Elon Musk, or SPACs. But it seems there will be more prosecutions coming - including in the crypto-currency space?
On September 15, the assigned District Judge Edgardo Ramos held an oral argument. Milton wants to move the case to Utah or Arizona, with a sealed motion. (Manafort's lender Steve Calk asked the same, to move to Chicago, which was denied). On September 15 Inner City Press live tweeted here (and podcast here)
Milton's lawyer Bondi: My client's alleged offenses are statements on social media or podcasts outside of New York, with no indication he was directing it into New York. Trading on NASDAQ was not an essential element.
Judge Ramos: Aren't you asking me to slice up the scheme fairly thinly? Weren't the statements made to induce people to trade on the stock exchanges based in New York? Milton's lawyer: NASDAQ's servers are not in the SDNY - they are in New Jersey.
Milton's lawyer: The Constitution provides that trial shall be held in the District where the crime shall have been committed. The words count. The Constitution uses the word "trial." The facts in the indictment are deficient on their face.
Milton's lawyer Joseph Bondi: Venue is improper in the SDNY as a matter of law. No meeting in New York, no overt act in New York. Under US v. Wilson, the stock exchange is not enough. If you leave it here you would be making new law, on the Internet.
Bondi: There's no directionality, no control, nothing to go into the District. You can avoid reaching these difficult statutory and Constitutional arguments. You have Rule 21(b) - you can transfer to a District where venue is proper, in Arizona.
Judge Ramos: Would venue be proper in New Jersey?
Milton's lawyer Bondi: No. There was no directionality, no purposeful availment of this District. Judge Ramos: US? Assistant US Attorney: The law is his area is not uncertain. The Grand Jury said it happened here.
AUSA: It occurred on the NYSE - & that is sufficient. Communications by the defendant entered into the SDNY and were received by victims here. That's enough for wire fraud and securities fraud. Judge Ramos: Mr. Bondi says no directionality. AUSA: That's not true.
AUSA: Mr. Milton made these statements nationwide, or really, worldwide. And the cases show the defendant does not have to have a particular intent to target our District. He sent them out by wires and they were received here. We will prove it up.
Judge Ramos: What is this SPAC located? AUSA: I believe Mamaroneck. But definitely in the SDNY. Mr. Bondi says there are no fact going to venue - that's not true. There's NASDAQ.
Judge Ramos: What about their servers being in NJ? AUSA: The headquarters is in SDNY
Judge Ramos: What about a bill of particulars or superseding indictment to clear this up? AUSA: We think it's specific enough. Mr. Bondi is free to move for a bill of particulars. Bondi: A bill of particulars or superseding indictment would not solve venue.
Milton's lawyer Bondi: I want to respond to Mr Podelesky. [It's Podolsky]. He cannot proffer that Mr. Milton exercised any directionality to SDNY with his social media. Judge Ramos: Are you saying it's only fraudulent in Arizona? Bondi: That's not the facts here.
Bondi: It was about semi-truck and badger trucks. Judge Ramos: If you tweet from Arizona, it goes beyond the borders of Arizona. Isn't that enough? Bondi: There has to be directionality, intent.
Bondi: It's different with email or a phone call - they are directed somewhere. Tweets have no directionality.
Judge Ramos: Isn't this premature? Can't the government make its case at trial? Bondi: No. The Constitution forbade trial in an improper district
Bondi: Even if they went to the Bronx and found someone who said they had heard Milton, it would not be enough. There's no directionality, no "freely choosing of venue," as the 2d Circuit said. AUSA: He can move to dismiss the indictment. This is not a civil case
AUSA: He keeps saying "directionality." I haven't seen that word in the cases. I don't know what Mr. Bondi is referring to. The cases say if the actus reus involve communications going into the District, that is sufficient.
Judge Ramos: Let's turn to the transfer motion. Bondi: The physical evidence is in Nikola's headquarters in Arizona.
Bondi: We filed a declaration under seal about why it should be Arizona. [Inner City Press filed to this Court to unseal in another case, #OneCoin; counsel there have been asked by these Chambers to respond but haven't yet, including DOJ] Bondi: Certain key witnesses are unvaccinated --
Judge Ramos: Wouldn't they be safer here? Aren't COVID levels lower in New York than Arizona? Bondi: They don't want to get on an airplane.
Bondi: We've checked with Ms. Rivera and we could see a defense lasting four weeks or even more. For a two month trial, we ask for April 2022, if it were to proceed here. Judge Ramos: I'm not aware of a defense case taking a month.
Ramos: Trial April 4; motions a month before. Final pre-trial conference the Thursday before April 4. My trial calendar is not mine to set. But we'll request April 4. Adjourned.
Inner City Press will continue to cover the case.
Back on July 29 at 12:30 pm Milton was presented before SDNY Magistrate Judge Sarah Netburn, and freed on consent, on $100 million bond. Inner City Press was in the Magistrates Courtroom and live tweeted it, here: (and podcast here)
From July 29: Lawyers whispering about a property in Utah. Seems he'll be freed on bond.
In the front: Milton and four defense lawyers. Three @SDNYLIVE prosecutors, including Jordan Estes and Nick Roos. Two Marshals. Awaiting Magistrate Judge Netburn. All rise.
Milton surrendered at 8 am. Case is assigned to District Judge Edgardo Ramos (who's also in One Coin cases.)
Milton pleads not guilty. Freed on $100 million bond. Less than Tom Barrack's $250 million
Milton can travel Utah, Wyoming, Idaho, Arizona, Virginia and DC (for lobbying?) No contact with investors unless Milton has a relationship with them. Morgan, Utah property appraised over $30 million (contrary to the Pre Trial Services report)
Milton's lawyer says his income is down, no $50 million in bank. Judge Netburn approved free today on $100 million bond. Surrender guns.
The case is US v. Milton, 21-cr-478 (Ramos)
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