Former Trump Organization CFO, Allen Weisselberg, is no longer in executive positions. Weisselberg's defense in his tax fraud case is expected to cost around $1.7 million. The podcast discusses who will pay for his legal fees and the challenges faced by wealthy defendants. They also talk about the sanctions hearing for Sidney Powell and Lin Wood, Michael Avenatti's sentencing for extortion, and the legal risks of airing allegations on Fox News. The podcast explores the potential consequences of public figures' statements and provides insights on reporting without endorsing.
The Trump Organization has removed CFO Alan Weisselberg from executive positions following his indictment for tax fraud, which is a typical corporate response to an indicted individual.
Alan Weisselberg's legal defense costs are expected to be significant, potentially exceeding the alleged $1.7 million in off-the-books compensation he received, raising concerns about conflict of interest and tax implications.
Federal district court judge Linda Parker presided over the sanctions hearing for lawyers Sidney Powell and Lynn Wood, expressing dissatisfaction with the baseless nature of the lawsuit and considering imposing financial sanctions.
Deep dives
Trump Organization CFO Alan Weisselberg being removed from executive positions
The Trump Organization is removing Alan Weisselberg, the CFO, from his executive positions in response to his indictment for tax fraud. While this move does not necessarily indicate a breach between Weisselberg and Trump, it is a standard corporate move to distance an indicted individual from positions of authority.
Alan Weisselberg's legal defense costs
The estimated legal defense costs for Alan Weisselberg are expected to be substantial, potentially surpassing the alleged $1.7 million of off-the-books compensation he received. While many companies typically indemnify their employees in lawsuits, including criminal cases, there are limits to what is covered, especially when the allegations involve criminal activity. The tax implications of legal fees for criminal cases can also be complex, potentially leading to taxable compensation for Weisselberg.
Conflict of interest with company-funded legal defense
Allowing an indicted employee, such as Weisselberg, to rely on the company to pay their legal fees raises conflict of interest concerns. If the accused individual needs to place blame on the company or pursue a defense strategy that runs counter to the company's interests, tensions can arise. This is a common challenge for white-collar defense attorneys when a company is funding the defense of multiple employees in a criminal case.
Sanctions hearing for Sidney Powell and Lynn Wood
Federal district court judge Linda Parker presided over the sanctions hearing for lawyers Sidney Powell and Lynn Wood, who filed the unsuccessful lawsuit seeking to overturn Michigan's election results. Judge Parker took issue with the baseless and frivolous nature of the lawsuit and questioned whether the lawyers violated Rule 11 of the federal rules of civil procedure. The judge was considering imposing financial sanctions against the lawyers and expressed dissatisfaction with the government's decision not to charge attorney Mark Geragos, who was involved in the meetings with Nike on behalf of Avenatti.
Sentencing outcome for Michael Avenatti
Michael Avenatti, the former attorney for Stormy Daniels, has received a two-and-a-half-year prison sentence for attempting to extort $20 million from Nike. While the sentence is a significant reduction from the eight years recommended by the probation office, it still marks a serious consequence for Avenatti's fraudulent behavior. The judge considered factors such as the flaw of the federal sentencing guidelines, personal disagreement with harsh white-collar sentences, and the judge's dissatisfaction with the government's decision not to charge Avenatti's companion, attorney Mark Geragos.
Fox News and the fair reporting privilege
Fox News aired a speech from former President Trump in which he made allegations about voting machine companies. To protect themselves from potential lawsuits, Fox News included a disclaimer stating that the companies had denied the allegations. This disclaimer helps invoke the fair reporting privilege, allowing the channel to cover newsworthy events without necessarily endorsing the truth of the claims made.
Allen Weisselberg is no longer in executive positions with the Trump Organization and its subsidiaries. Does this signal anything about the relationship between the former CFO and the company? Weisselberg’s defense is going to be very, very expensive. How expensive? Ken says there’s a good chance a full defense in a case like this could even be $1.7 million — the amount in off-the-books compensation Weisselberg is alleged to have received. So who’s paying those legal bills, and what happens if a wealthy defendant such as Weisselberg can’t afford them?
Then: the sanctions hearing for Kraken lawyers Sidney Powell and Lin Wood with a federal district judge in Michigan did not...go well. Ken and Josh discuss what makes an affidavit too stupid to file, and whether you should be sharing your sanctions hearing on Telegram. (You should not.)
Also, Michael Avenatti received his first sentence: 30 months for trying to extort Nike. This may be the end of his legal career (it is) but it’s not the end of his legal troubles. He still faces two more cases for allegedly stealing money from both Stormy Daniels and a paralyzed tort lawsuit plaintiff. And finally: Can Fox News air just about anything as long as they run a chiron or disclaimer with it?
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