Law&Crime Sidebar - Will Elon Musk Go to Jail For Canceling Twitter Deal? Ghislaine Maxwell Appeals, Kanye West Sued

Episode Date: July 12, 2022

Law&Crime’s Angenette Levy talks about Elon Musk pulling out of his bid to buy twitter and now twitter says it will sue and a CNBC commentator suggests that could put Musk in danger of facing jail time. Commercial law professor Annat Alon-Beck weighs in. Plus, Ghislaine Maxwell appeals her federal sex crimes conviction arguing jail conditions made it impossible to prepare for trial and Kanye West sued for not returning vintage clothing.LAW&CRIME SIDEBAR PRODUCTION:YouTube Management - Bobby SzokePodcasting - Sam GoldbergVideo Editing - Michael DeiningerGuest Booking - Alyssa FisherSocial Media Management - Kiera BronsonSUBSCRIBE TO OUR OTHER PODCASTS:Court JunkieThey Walk Among AmericaCoptales and CocktailsSpeaking FreelyLAW&CRIME NETWORK SOCIAL MEDIA:Instagram: https://www.instagram.com/lawandcrime/Twitter: https://twitter.com/LawCrimeNetworkFacebook: https://www.facebook.com/lawandcrimeTwitch: https://www.twitch.tv/lawandcrimenetworkTikTok: https://www.tiktok.com/@lawandcrimeSee Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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will keep you on the edge of your seat. Don't let your fears take hold of you as you dive into this addictive series. Love thrillers with a paranormal twist? The entire Oracle trilogy is available on Audible. Listen now on Audible. The world's richest man, Elon Musk, pulls out of the deal to buy Twitter, and now Twitter says it will sue him. It has one CNBC commentator suggesting the move could send Musk to jail. I'm Anjanette Levy, and welcome to Law and Crime's Sidebar podcast. Well, this made major headlines. Last Friday, Elon Musk announced that he was pulling out of that $44 billion deal to buy Twitter.

He had wanted to buy the social media platform but said that the company wasn't being transparent about the number. of fake accounts out there. So joining us to discuss this is Professor Anat Alonbeck. She is a business professor at Case Western Reserve University in Cleveland. Professor Alambeck, thank you so much for coming on Sidebar. We appreciate it. Thank you. It's really an honor. I follow your podcast. So thank you for having me today. Oh, well, we appreciate that. Thank you. So tell us why is Elon Musk in hot water with Twitter. It's my understanding he was demanding transparency, information about the number of fake accounts on Twitter. Twitter didn't want to supply that or said they had supplied it. So what's the big deal here? So let me kind of show you the big picture and what's going on, right? So we have

this effort supposedly from Elon Musk. He says, okay, I'm going to purchase this company. I'm going to take it private. Instead of public, I'm going to take it private. I'm going to own one of the biggest social media platforms, right? I'm basically going to own the next town square. And the problem is, he offered to buy the stock. And now, by the way, there's a 47% premium on the price that he offered. And it looks like he's trying to get out of the deal. And what's happening is that it looks like his lawyers are coming up with reasons of why he should be able to get out of this deal, right? He signed a contract. He signed a contract says, I want to buy this company. He has buyer's remorse, he's trying to get out. Now, with regards to the privacy of the information,

what he's been asking for is with regards to these, you know, fake accounts, right? We know that they have some fake accounts. They even filed on the SEC's website, these reports that are admitting that. And by the way, let me just say, he didn't do a due diligence before all of this. Okay. And now, while they're negotiating, although he already signed the agreement, he's telling the company, I want to see all the information on these fake accounts. And it's really problematic. Why is it problematic? Because we're talking about Elon Musk, right? And we've seen back and forth between, you know, Musk and people on Twitter, do we trust Elon Musk? Can we trust them, even though he signed an NDA? Is he going to respect the NDA? Is he going to tweet about

confidential information about the company? What's really going on here, right? And so that's why it's so important. And I don't know if it's, is it just an excuse? So some commentators, saying it's an excuse. You knew they were a fake account. He's trying to do all this because he's trying to get out of the deal. Others are saying, wait a minute, it's a legitimate business reason. He wants to see what's going on. They won't provide it to him.

And why? Again, think about it. We're talking about confidential information, material information that the company owns. And we don't know how he's going to treat that information, right? And so that's really the back and forth with regards to the accounts, which is one of the three other issues. that he's saying of why he wants out of the deal. And what he wants now, he doesn't want to pay. He doesn't want to pay up. I feel like NDAs typically are only worth the paper they're written on.

We've seen people break NDAs all over the place. So I can understand the concern there. Also, you know, he announced this bid to buy Twitter in the middle of the, you know, Dep V. Heard trial in which he was a central figure. He was discussed every day. And then he announces he's buying Twitter right in the middle of this trial. Could this have been a stunt? I think what's going on is that he really wanted to think about it by one of the most important platforms that can affect not just trial and public opinions, even about who's going to be the next president of the United States potentially, right? So this is a very powerful tool. A billionaire like Elon Musk is going to want to control the town square. We have got billionaires on papers,

the old social media platforms, right? So I'm not surprised that somebody like him is going to want to, you know, buy Twitter. Also, earlier today on CNBC, see. David Faber suggested to his colleagues, Jim Kramer and Carl Kintania, that Elon Musk could somehow go to jail over that, this whole thing. I don't see that. What are your thoughts on that? You're the expert. Oh my God. That's the billion dollar question, right? I mean, that took me by surprise, too. I said, well, I'm going to eat my hat if he actually goes to prison. But let's think about it from this perspective. First of all, Twitter is suing Elon Musk, right? And that litigation is going to happen in Delaware, it's going to be a civil suit. That's not going to send them to jail.

What could potentially happen, which I don't think it's very likely, but who knows, I don't have a crystal ball. And that is if the security is an exchange commission, right, if the SEC decides, wait a minute, there's market manipulation here, right? Think about it. We've got a person, we've got a billionaire that has the power and the ability to move the stock market. So if the SEC finds that there is market manipulation here, then they can recommend to the DOJ to file actions against Musk to start a proceeding against them, or the DOJ can decide to do that on their own. Then there will be an FBI investigation. The criminal proceedings could again start, but only if they show or they think that there's some intentionality, right?

It has to be an intentional. He has to want to manipulate the securities market. And so maybe he's thinking along those lines. That's really the only way I would see that type of argument. And think about the regulators, pretty upset with him right now. Because this is not the first time. Think about what he did in 2018, right? We've seen Elon Musk pulling out of deals before. We see his power affecting the stock market. And then the question is, is this market manipulation?

Does this amount to intentional market manipulation? Is that why he's doing this? Was he not sincere in wanting to buy the company? Did he just want to manipulate the stock market? So that would be the line of argument. Well, we know that Elon Musk's words have a lot of power. He's spoken in the past and moved markets. He's pretty powerful, almost as powerful as the president of the United States.

When the president of the United States speaks, people listen. And when Elon Musk says things, people listen. We've seen it happen in the past. So Dr. Annette Alone Beck, professor of corporate law at Case Western Reserve University, thank you so much for coming on to talk with us. We really appreciate it. Thank you so much for having me today. It's an honor to be with you.

Galane Maxwell, the ex-girlfriend of Jeffrey Epstein, has appealed. She promised to do so, and she's already serving a 20-year federal prison sentence. And joining us to talk about Galane Maxwell's appeal is Jacob Shamsian from Insider. He is a legal correspondent there. Jacob, welcome back to Sidebar. Thanks for coming on. Thanks so much for having me. Jacob, tell us a little bit about the appeal that Galane Maxwell's attorneys have filed on her behalf. Right. So we've known this whole time that Glenn Maxwell would be appealing. I mean, even like throughout her trial, her lawyers would raise arguments. They knew the judge would like, basically saying, oh, we're just making this so we can include it in the appeal later. You know,

appealing was always going to happen. And there's a few different things that happen here. Obviously, like, you know, when it comes to an appeal, it's all based on issues of the law. And for here, they're basically saying the trial was never fair because Glenn Maxwell was in jail the whole time and the conditions were so bad. She couldn't meet with her lawyers and participate in the appeal. The judge, who oversaw her case, Alice Nathan, has totally rejected this, like, multiple times, you know, throughout, before her trial, during her trial, they kept saying jail conditions so bad, you know, she can't review the documents. There's guards there spying on her. It doesn't work out. And the judge, basically said during her sentence,

like, I don't think any of this really makes any, like, is true even? Like, she basically called her lawyer's kind of liars for, and pointed out. that, you know, Bill and Maxwell actually got better jail conditions than most people because you, her great lawyers, like, made sure she can get that access. So, you know, I think it was a pretty low chance that argument's going to fly. Probably the strongest arguments in Glenn Maxwell's arsenal is over juror number 50, the famous Scotty David saga, for those of you who were following. If you guys don't remember, Scotty David, first name, middle name, identified, he was one of the jurors in the trial. He told to media outlets after the trial that he himself was a victim of

childhood sexual abuse. And it seems that he didn't disclose this on his juror questionnaire when he filled it out. And so we had this really highly unusual situation. The judge kind of had another hearing, pulled him in, questions him on the stands, and basically concluded, like, look, this guy just like flew through the questionnaire. He didn't intends to deceive. He kind of just Like, you know, and it made sense, even if he did answer honestly, he still could be seated as a juror and none of this reached the high bar that it takes to throw a whole verdict out, which is what Maxwell's lawyer wanted. But it's really an usual situation and there's not a lot of precedence. And I think that's a, you know, if we're going to succeed in the court of appeals, it's going to be with that argument. That's what I would think as well, because that issue, if he had disclosed that on his questionnaire, her team would have not allowed him to sit on the jury.

I would think they would have stricken him when they had the chance. So I think that's the strongest issue as well because they always argued that it only takes one juror. And I think it's interesting that you point out, too, that the federal prosecutors said in a lot of court filings that she was receiving better treatment than a lot of the inmates who were being held at the same facility pre-trial because of her high profile status. I mean, she can't expect to be treated like she's at the Ritz Carlton when she's sitting in jail awaiting, awaiting trial. Yeah. And I mean, to be fair, the conditions of the MDs being broken, which is the federal jail where she was held, are notoriously bad. The judge, like, even criticized the jail conditions during her sentencing hearing. And, you know, she was, because of COVID, you know, she's basically almost, you know, in solitary in a certain way for a long period of time. And yeah, it's hard to prepare her case there. Like, you know, I think everyone can be sympathetic to that, that everyone deserves a fair trial and should be able to prepare. And she's, be able to, you know, talk with our lawyers ahead of trial. But, you know, the question is, does this meet the legal bar for unfairness? And the judge said, well, no, because you had, even though conditions were bad, you had better conditions than everywhere else, everyone else,

because here your lawyers are sending me all these motions at any time a day for months, basically making sure that you get what you needed. And I made sure you had that the whole time. Scotty David, you think is the strongest argument. I think that's the strongest argument on appeal as well. Do you see the Scotty David issue winning the day for her? I mean, I know I'm kind of asking you to speculate, but do you think it could rise to that level? And the appeals court would say, yeah, she's got a point here. No, it's really hard to say. And it's also really tough because no one, no one really wants a retrial here, which would be with the conclusion here. You know, if you attended the trials, either you heard these victims. who testified, and it's really, like, heartbreaking, really difficult thing for them to say. All of them said, you know, I didn't want to want to speak, but I wanted to, you know, get a sense of justice here. I wanted to make sure the world knew what happens. And if the verdict is thrown out and they have to testify again, I think that would be really devastating. I don't know if all of them

would do it. So it's, you know, it's definitely in like the victim's lawyer's interest and the prosecutor's interest and not have to do retrial. Will it happen? You know, I don't know. I mean, it's It's so hard to say, there's so little precedence for the situation, which is really why, you know, it's a strongest argument for them. And so why it's just hard to, hard to predict. You know, we saw, I mean, it was a different situation, but in the Bill Cosby case, even though it had all this media tangent, even though, you know, Bill Cosby had these other, all these accusers, you know, there's just this very narrowly defined legal issue that got the verdict thrown out in his case. And we could see that in the court of appeals here, it's based on this very, very narrowly defined legal issue that Gillesne Maxwell's case would be thrown out. I think, though, even if it does happen, you know, she would still remain in jail until she gets a new trial. So in that sense, you know, she'll still be locked up for what it's worth.

But will she get a new trial? It's just, it's impossible to say. Right. We just have to wait and watch. There are a lot of people who talk about this. And I know that I've talked to some people in the. the federal realm who think she could eventually start talking, especially if she's sitting in jail for 20 years. I mean, she's going to be almost 80 years old by the time she's eligible for

release if she doesn't get a new trial and win that new trial. You know, we're kind of speculating here. So do you see this as a thing where she might decide to talk eventually? I think there's a chance of that. She's going to exhaust all her legal options now. She's going to go through this appeal. You can take a couple of years. We'll see where it goes. She has another trial. She'll go through that trial. So it could be quite a while, you know, but I think once she exhausts all her options, as it is now, she's going to be sitting there and thinking, like, well, look, I'm 60-something, you know, I'm going to be here until I die probably. And so I have my loving family who has supported me all this, for all these years, rather like, you know, be a pariah out there than in

here. So she might make that calculation. It wouldn't surprise me at all. Well, it is a lot of wait and see, and we will be waiting and watching. Jacob Shamsian, legal correspondent with Insider, thanks again for coming back on to Sidebar. We appreciate it. Thank you so much. Kanye West is facing some legal trouble. He is being sued by a clothing rental place for $200,000. They're saying he hasn't paid his bills. So what does this mean? Mitra Horian is a litigator and entertainment lawyer, and she is here to explain it to us. Mitro, welcome back to Sidebar. Thanks for coming on. Thanks for having me, Ingenet. So basically, David Casabon is a stylist, and he, from the age of 14, sort of fell in love with fashion and started this archive, just started collecting vintage clothing. And now he's amassed this beautiful archive of vintage designer clothing and attracted the likes of Rihanna and Kanye West, who have since used his clothing rental services, basically instead of having to buy. things for the red carpet and for photo shoots and such. They get to celebrities just get to

rent them. Usually they just wear them once and send them back. Kanye has been late to send some things back in the past, but he's always paid these late rental fees and then return them eventually. I guess things have gone on a little too long for David's taste this time. So we're looking at over a dozen pieces from 2020 that Kanye has held on to. And as you can imagine, these are unique pieces. So the rental rates are expensive. And over the past couple years, they've amassed to roughly $200,000. And then there is a potential $200,000 additional claim if he actually doesn't return them.

So there would be the rental fees for the past couple of years that he hasn't returned. them and then a replacement fee for the various pieces. So that's what this case is about. It's a breach of contract. So David Casamon supplies clothing, these original pieces to a lot of celebrities. I'm reading Paul McCartney, Rihanna, Lady Gaga. So these are huge, huge names. This seems rather silly in like something Kanye West, or I guess Ye is what his legal name is now, something he probably really doesn't need. So why not just take care of this instead of dragging your feet on paying the tab. To me, it just sounds like with sort of all the other things that are going on with the divorce and a number of other lawsuits happening, this is probably very low on the totem

poll in terms of things that he's thinking about is returning these clothes. Maybe he doesn't know where they are. Maybe he's, you know, his business manager is just not staying on top of these sorts of bills. And so that's possible what happened. I don't know that it's necessarily, you know, kind of a screw you, I'm not going to pay this. It might be just more of a disorganization. So you think that this will end up getting resolved then? He'll either pay the bill, return the clothing, or just pay the whole thing. And so this can be done with. I would think so, yeah. I mean, it seems to me that they would have gone to him many times to try to collect before filing a lawsuit. They have absolutely gone to him many times. It's actually interesting because

Kanye is somebody that David Casamont respects a lot. He's kind of one of his dream artists. He's respects his style and they have had a longstanding, you know, relationship that's been a good relationship. So it's really surprising, I think, from, you know, just from a personal, personal relationship standpoint that this would happen. And so, yes, they definitely did send some demands to Kanye, to his, you know, his business manager, the legal team, and it really got to this place because they weren't getting a meaningful response. Well, and it does seem rather silly, I mean, to destroy a relationship over this type of thing. So maybe it is an issue with the business manager or maybe he's just got too much on his plate. It seems like I'm always

reading about issues with him and the divorce, obviously, and the fact that he's upset about Kim Kardashian's relationship with Pete Davidson. So it seems like Kanye's got a lot going on in his world. I mean, is that kind of the buzz in Hollywood that this is a guy who's just got a lot going on and also there have been concerns that his mental health may not be in the best shape. Yeah, I don't think this is kind of the, you know, we all have good moments in time and difficult, challenging moments in time. And I think this is certainly one of Kanye's challenging moments to, you know, lose his marriage, his relationship, not see his kids as often. And then, of course, see his ex-wife in love with someone else. All of that is really hard, I think,

for anyone. And then to have it come out publicly is even harder. But, you know, he does have a business manager and typically the business managers are supposed to take care of these things. So it's really hard to know what the stance is there and what exactly happened. I mean, maybe the clothes are lost. I lose clothes all the time. I don't know how. I don't know where they go. But maybe they're lost. I think we all have like that hamper that just eats socks or clothes or maybe it's the dryer. I don't know. I lose stuff too and sometimes I leave it at the cleaners. Who knows, but I'm not Kanye and I'm sure I don't have as many homes or closets as he does. So Mitra Ohorian, thanks so much as usual for coming on to talk with us about

Kanye West lawsuit that's been filed against him. I guess I should be calling him Yee, but everybody knows him as Kanye. So thanks again, Mitra. Yeah, my pleasure. And that's it for this edition of Law and Crime Sidebar Podcast. We want to acknowledge the people who work on this show. It is produced by Sam Goldberg and Michael Dininger. Our YouTube manager is Bobby Zoki.

Alyssa Fisher is our booking producer, and Kiera Bronson runs our social media. You can find Sidebar wherever you get your podcast, Apple, Spotify, Google, YouTube, and a lot of other places. I'm Jeanette Levy, and we'll see you next time. You can binge all episodes of this long crime series ad-free right now on Wondery Plus. Join Wondery Plus in the Wondery app, Apple Podcasts, or Spotify.