Star Witness
This morning we are waking up to the most explosive part of the Trump Hush Money trial in Manhattan, the testimony of Michael Cohen, Trump’s personal lawyer and fixer over a decade in days gone by. At the early part of the testimony, the bulk of the pitter patter from the cable news legal/litigation pundits is about what the prosecution wants of Cohen and how the defense is likely to try to undermine Cohen’s credibility. There is a three-dimensional aspect to this testimony because in addition to the direct questioning and the anticipated cross-examination on one level, there is the manner in which the defense attorneys object to the testimony or questioning or not. It has been made clear through the two attempts last week by the defense team in seeking a motion for mistrial that the degree to which the team puts objection markers down during the questioning, does indeed make a difference in the judge’s tendency to side with their motions. In other words, if they don’t raise objections during the course of the trial, that impairs the strength of their motions for mistrial. The same is likely to factor into the view and reasoning about the defenses’ inevitable motions for appeal after the trail is over. Overlay on those two separate layers of judicial procedure the manner in which the gag order is treated alongside the manner in which Trump reacts to things during the trial. This whole trial is an exercise in performance art intersecting with litigation procedure art.
I think about three instances in which I was a fact witness in criminal trials. I think it is fair to say that in one of them I was a “surprise” witness, in another I was one of an array of witnesses, and in the other I was the “star” witness. The first case was during my VC company days. It involved a 23-year-old Asian-American CEO of a company we funded (I was the Chairman of the company). He had embezzled $800,000 from the company and laundered it through a glitzy casino in Atlantic City in his efforts to turn the remainder of his funding into a bigger pot of gold with which to make his vision for his company a reality. During his trial, I was not called as a witness since it was a documentation-heavy case that quickly ended in a conviction for fraud and 1-3 year sentence. I recall watching the young man get led handcuffed out of the courtroom with a look of fear in his eyes and his mother crying from the gallery. Several years later when he was released, he sent me a basket of fruit as an apology. I made sure to throw out the fruit…just in case. It was his retrial on another event a few years later which involved me as a witness. He had gone on to repeat his crime and to use his experience in the company we had funded as a reference to bolster his credibility as an entrepreneur. the prosecution sprung me on him as a surprise witness to specifically refute testimony that he had given about having successfully sold the company we had funded. Normally, the prosecution could not bring in his prior misdeeds, but I could testify that he had lied about the sale of the company we had funded. I was brought out into court to his surprise (he was sitting at the defense table looking a good deal older, but obviously no wiser). I explained to the jury that the company he supposedly sold was sitting in a box in our archives and was never sold or available for sale. It was a dramatic day in court.
In another case, a very renowned internet investor with whom I had negotiated to buy his investment firm was being tried for fraud. He was a high-profile Forbes 400 billionaire during the heyday of the first internet boom on the 90’s. I was considering buying his firm on a dead-cat bounce in internet shares in the 2005 timeframe. To make a point about the Forbes 400 list, this guy was on the list for several years, fell off the list, and then, due to the market rebound, was put back on the list with great fanfare (erroneously so, in my opinion). We did not buy the firm because our due diligence unveiled a smoking gun memo which proved that the man had been either lying to us about his investments or to his private bankers. When I confronted him with it, his reaction was to swear that I could never have found that memo. That was enough confirmation that this was not a person with whom we wanted to do business. I was called to bear witness to our discovery about his business practices and was one of an array of people who testified in similar manner, ending in the conviction and incarceration of this billionaire who had fallen to earth and hit the ground with a thud. Once again, I had to stare at the defendant table and look the man, another soon-to-be-convicted felon, who was on trial, squarely in the eye.
The situation I was the star witness in involved the collapse of two large hedge funds in the array of funds offered by the firm I ran. Due to the high profile collapse of the financial markets in 2007/2008, prosecutors were looking hard for cases to bring against the perpetrators of the debacle. We were actually the victims of the debacle as buyers of CDO paper that was based on over-rated subprime mortgages, but since we had sold the funds to investors, the prosecutors felt there was a case that my team had misled investors. Rather than doing the hard work of going after the manufacturers of the defective product, they went after us as the buyers and resellers of the product. I spent more than a year working with the U.S. Attorney for the Eastern District of New York, trekking out to the courthouse on Tillary Street in Brooklyn and giving them testimony. That is where I learned why all of these questions sessions have an FBI sitting in the room.You see, lying to the U.S. Attorney is not a crime, but lying to the FBI is. Hence there was always a different junior note-taker from the FBI there to improve the earnestness of the responses. I cooperated fully with the prosecutors, but they knew I did not feel our team, their indicted defendants, were guilty of misleading investors. As appreciative as the prosecutor was about my cooperation, he did not call me as a witness and I was immediately called by the defense. I suddenly became the star witness for the defense (they only had three other witnesses, who were all expert witnesses), making me their one and only fact witness. In that case, staring at th defendants was not a hardship since I was on their side, but facing off against my friendly prosecutor who I had spent a year with under the hot lights, was an interesting experience. It all gave me a balanced view towards this sort of criminal litigation, better understanding how sometimes defendants are guilty liars and sometimes prosecutors are reaching too far to get a conviction.
As I hear about Michael Cohen’s testimony this morning, my mind goes back to that same courthouse in Manhattan where all three of my witness testimonies were given in one courtroom or another. These are stark and stuffy old courtrooms with the most impressive part of the venue being the courthouse steps in front that we have all seen every week on Law and Order. It is all a very dramatic world, which explains its richness for movies and TV series. It is all about life and death and truth and lies, and thus goes to the heart of human nature and its frailties. Imagine the things swirling in my head given that Trump is a wannabe Forbes 400 character who lies to bankers and potential investors in the normal course. Each and every one of my cases touches on some part of his and Michael Cohen’s story. The elements of Atlantic City, the Forbes 400 list, asset inflation, tax evasion, and the entire smarmy side of developer life, even further dragged into the mud by the addition of politics and the lying and deception that inevitably entails. I am riveted by the case and only wish I could be in the room where its happening.