By Matthew Russell Lee, Patreon Maxwell Book
SDNY COURTROOM, March 14 - In the U.S. District Court for the Southern District of New York on December 27, 2022 a complaint was ordered unsealed charging Avraham Eisenberg with commodities fraud. He was arrested in Puerto Rico.
Inner City Press is covering the case(s), often as the only media in the Mag Court. Related Mag Court live-tweeted thread (more on Patreon here) vlog here
On January 9, Inner City Press came across the CFTC case against Eisenberg, just filed (still with no title in PACER) and put it out on Patreon here. The 21-page civil complaint is, as is often the case, more detailed...
On April 12, the US Attorney's Office filed a motion to intervene and stay the Mango Labs v. Eisenberg case, saying that neither side opposed the stay. The US seeks a "full stay until the conclusion of the parallel criminal case."
More on Substack here.
On June 14, Judge Berman held a proceeding to pick a trial date. Inner City Press covered it, thread here.
On July 27 Eisenberg moved to dismiss and to suppress; he submitted a 7-page affadavit including "In the evening of December 26, 2022, I arrived by airplane at The Luis Munoz Marin International Airport in Carolina, Puerto Rico, just outside of San Juan. 3. I disembarked the airplane with my luggage, a backpack and a suitcase. 4. I walked to the United States Customs counter. There, I was questioned by a United States Customs and Border Protection ("CBP") agent regarding the purpose of the trip I had just completed and general questions about the contents of my luggage. 5. The CBP agent directed me to a specific area several feet away from the Customs counter for additional questioning, and there another CBP officer opened the suitcase and backpack. I recall the agent pulling out the laptop and asking me to turn it on" - full affidavit on Patreon here.
Watch this site.
The complaint is on Patreon here
On February 3, Eisenberg in a yellow jump suit and feet shackled was brought into Magistrates Court at SDNY. He had, at least for the proceeding, the same lawyer Ethereum developer Virgil Griffith had in the North Korea sanctions case he pled guilty in: Brian Klein.
His parents were in the gallery and he looked at them, from two rows away. The prosecutor said that (unlike on Sam Bankman-Fried) they were seeking detention, and that he was consenting at least for now. Here is Inner City Press' thread.
There's more detail on Patreon here.
On February 14, there was a very brief arraignment, thread here
On November 2, 2023 Eisenberg's counsel wrote it seeking to push the December 4 trial to March or April. They said Eisenberg was moved from Essex to the MDC, and not allowed to bring his discovery material with him. The SDNY prosecutors acknowledge that's a problem, but want only a one-week delay to December 11 - or to April, citing an unrelated murder trial.
On November 3, it was moved to April 2024. And on November 21, Judge Amit Subramanian set out questions to be answered in early December, including "Whether any transaction involving USDC, even where it is used as a medium of exchange to purchase something that is not a commodity, is nevertheless a “contract of sale of any commodity” given the statutory and regulatory definitions (see Dkt. 37 at 5-6); Whether the indictment alleges manipulation as to the price of USDC, deceptive conduct affecting the USDC market, or deceptive conduct otherwise “in connection with” a contract of sale of USDC (see Dkt. 37 at 7–8); Whether the indictment alleges a manipulative device “in connection with . . . any swap” where Eisenberg was the party on both ends of the MNGO Perpetuals" - full order and questions on Patreon here.
On March 14, 2024, there was a hearing on motions in limine and experts. Inner City Press live tweeted here:
Ok - now at case of US v Avi Eisenberg.Judge is not yet on the bench. Avi Eisenberg, with his 3 lawyers, now has close cropped hair. 4 at the prosecution table, looking back. All rise! Judge: Mr Eisenberg, are you OK? A quiet Yes. Judge: We're hear on motions to exclude and in limine
Judge: The defense wants to call the prosecution claims "novel." AUSA: Mr. Eisenberg tweeted about US v Neil Phillips [which Inner City Press also covered on this site
Eisenberg's lawyer: We intend to object to the Phillips tweet. They're going to say he should have known Mango Markets was in the ambit of CFTC or SEC. AUSA: We're not going to get into which agency. Mens rea is the key
AUSA: We're getting toward a "code is law" inference...Question as to terms of service, in defi, who the duty is between... They will be arguing Mango Markets should have seen this coming Eisenberg's lawyer: What he did was not criminal.
Judge: Now the Daubert [expert] issues. Eisenberg's 2d lawyer: As long as Mr. James doesn't testify what things were designed to do, it's fine. AUSA: He will speak about how USDC was designed. Judge: We have these disclosures. I come at this from the civil side
Judge: No one is going to say the system was designed to do something. AUSA: We appreciate it. They have noticed that Mr. Sheridan is going speak to Mr. Eisenberg's intent - but he is not an expert in that. Judge: It'd be improper for him to testify about strategy
We will continue to cover the case.
In a parallel civil case, on February 24, 2023 there was an hour and a half argument in Mango Labs v. Eisenberg before Judge Lewis J. Liman. Inner City Press live tweeted...
Ultimately Judge Liman extended the TRO for two weeks, after for two letters by Tuesday, and said he will rule on March 10.
On March 10, Inner City Press was there, thread here
More with analysis on Substack here
Watch this site.
Inner City Press will have more on these cases.
The criminal case is US v. Eisenberg, 23-cr-10 (Subramanian)
The stayed CFTC case is Communities Futures Trading Commission v. Eisenberg, 23-cv-173 (Schofield)
The Mango Labbs civil case is Mango Labs, LLC v. Eisenberg, 23-cv-665 (Liman)
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