Trump's DOJ Lets Ticketmaster off the Hook for No Reason

Transcript

This transcript was generated automatically and may contain errors — the audio is the record.

0:00:00 Clip: Thank you.

0:00:00 Thomas: Isn't enough like detailed, proportional information and how many different ways things get ruined when fascists who control all these levers of power. It's

0:00:17 Matt: Are forcing venues into these long, exclusive contracts, basically strong-arming using Ticketmaster only. Ticketer, venue owner basically being controlled, and if not controlled, strong -armed by the same people. And

0:00:34 Thomas: And welcome to Opening Arguments. This is episode 1243. I'm Thomas Dowd. Over there's real-life immigration attorney Matt Cameron. How you doing, Matt?

0:00:40 Matt: Right, just have another Wednesday. Just filed another lawsuit against Kristi Noem, while I still can. Got a few more days here, everybody. 25 more days at Crispin Home.

0:00:50 Thomas: I didn't even realize that. I thought she was just gone. So there's like a time lag on it. Oh.

0:00:53 Matt: End of the month.

0:00:55 Thomas: Oh. Wow. So she's got to try to get her jet's worth. Get know, get a lot of different words I could have used there. Uh,

0:00:59 Matt: That's right. Get our perks. You know, you'd think that'd be the kind of job where you have to carry your box of stuff out the day you're fired, but I guess you get to hang around a few more days.

0:01:10 Thomas: Yeah, I for sure thought that I never would have dreamed, you she's still in there. Huh? What are you suing her for?

0:01:16 Matt: It felt pretty good. It was a habeas petition. I got to write, I mean, she's one of the defendants. Obviously, I get to sue Pam Bondi and, of course, our local jailer as part of the habeas petition, but I got to write that Kristi Noem is currently the DHS secretary. So that's true, at least as of now. The way these habeas petitions have been going, this will be settled weeks before she's out.

0:01:36 Thomas: You don't get to sue her for the plane or anything it's gotta just be like some other various

0:01:40 Matt: No, or any of the emotional

0:01:41 Thomas: Animals she's killed yeah Yeah. Darn. Too

0:01:46 Matt: Just a plain old habeas petition like we do pretty much every week now. Just

0:01:50 Thomas: That's the thing that gives the president the right to detain.

0:01:53 Matt: That's right. To hold people. You were listening.

0:01:55 Thomas: Yeah. Make sure. Yeah, I learned something. You know, it's good to actually learn something for once on the show. Make sure you caught Wednesday's episode for some real. I don't know what Matt's been teaching us, but we got the real law education from Kristi Noem on.

0:02:12 Matt: From the horse killer's mouth. Yeah. I think she also shot some horses, as a patron pointed out. So yeah.

0:02:16 Thomas: Probably, you know, I'm going to believe it at this point. Like whatever animal you say, that was insane. I really, I imagine everyone listened to all the episodes, but man, I really you sold that as even worse than people remember. And that was 100 % accurate. There's exaggeration there.

0:02:33 Matt: Have to hear it to believe it. You have to. Just to hear her say it herself is so much worse.

0:02:39 Thomas: Crazy. Wow. Couldn't happen to a worse person. What are we going to be talking about today?

0:02:44 Matt: One of the things we're talking about is her new job in the Marvel-inspired Shield of the Americas. We'll get there. To look into this because this was literally just made up a few days ago. So I want to see what that's about. But we also, the big one we got to talk about is this Ticketmaster settlement because everybody listening has at some point had to buy something from Ticketmaster, and will again. I got to explain what's going on here. It's something I've been following for a while. We'll spend some time on that. That's coming with the current state of antitrust, of course, under the Trump administration not looking so good. I want to talk just a couple of quick AI -related stories. We haven't touched on AI in the law recently, but there's a lot happening right now. Got a couple of weird ones. First, we've got the first known use, and of course, this has probably happened already, but it's the first known use of an AI briefing by a DOJ attorney. So that's a big milestone, not the good kind. And then we have a really interesting lawsuit in which an insurance company is suing ChatGPT for providing legal advice to someone who is sueing them

0:03:41 Matt: And as an attorney. Yeah, it's really interesting.

0:03:44 Thomas: That's weird. Okay. I'm very curious to hear how that would.

0:03:47 Matt: Make sense when you hear it, but and then we got a fun footnote about predictions markets. Markets. You might have heard about this one, but I wanted to get into it because I was so curious when I heard the story about the big lawsuit over the Kalshi predictions market about Ayatollah would be out of power and exactly what that means legally.

0:03:47 Thomas: All right. Interesting. God. Yeah. Yep. Oh no, I think it was whether he would leave office. That is it. Yeah whether he would leave Office and I think that is a tough one. That a tough definition. First off, these these things shouldn't exist and they're bad. I think these have been covered quite a bit, but, so that's an easy one. But secondly, just let alone all these different wording problems that you have in normal betting markets too. Sometimes, I mean, with sports, it's mostly ironed out, but sometimes there are the weird ones in sports. Every, so often there's like a, a, something you bet on that doesn't quite, it'S like arguable whether or not it turned out. And, uh. No, that's, that definitely causes a lot of heartache. Huh

0:04:09 Matt: He leave power? That's right. Excuse me. Would leave office. That's right. I got it here.

0:04:41 Matt: Yeah, it got me looking at what this thing is, because I haven't been following this stuff too much. But Calci and Polymarket, they're not actually betting. They're not supposed to be. Actually a whole other kind of futures trading, basically. So I want to talk about how they're regulated, because it's actually pretty interesting. Yeah, plenty to get into today.

0:04:50 Thomas: Interesting hmm didn't like plenty to learn all right well I'm excited let's uh take our usual break uh avoid the breaks of patreon .com slash law and support the show become one of maybe even the hall of famers whose names we love reading each and every wednesday good times uh all that patreon .org slash law all right we'll take our break and then we'll get to it. Right, Matt, let's talk Ticketmaster. This is, I've seen a little bit on this and I'm worried that it's yet another thing that's being ruined by this administration. Not like this was a good state of affairs, but I thought this was taken care of by your band in the nineties that that you were the drummer for because we know that Matt as the drummer for Pearl Jam, right? Was that the right? Am I thinking of the right, yeah.

0:05:33 Matt: That's okay. Yeah, that's kind of a weekend gig I had for a while.

0:05:41 Thomas: That they took on Ticketmaster, right.

0:05:43 Matt: Did.

0:05:44 Thomas: I mean, it's, we see those memes all the time. That's like the years, you know, 1991, a bush is in the way as well. You know, it was like that, where it's like, someone's taking on Ticketmaster yet again, they've been pretty resilient that Ticket master. What did they do this time?

0:05:57 Matt: I mean, they are just too big to fail at this point. So big antitrust case. I've been following, I mean, I love going to shows, obviously. It's very important to me that tickets are reasonable price and don't have a bunch of fees attached to them. I actually, fun story, got involved in the Ticketmaster lawsuit, I don't know, must be 15 years ago. I filed just to be a dick about it. I file as an intervener. I'm going to link to this because I had a lot of fun. Basically, you can do this in any given lawsuit. You can intervene and ask for your own set of terms. And so I demanded that Ticketmaster give me a handle of Jack Daniels and a number of other things, just my own little special deal. I even offered to come to LA to be part of the hearing, but nobody took me up on that.

0:06:39 Thomas: What was the purpose of this? Yeah oh

0:06:42 Matt: To complain and to make a, just to write a funny filing into the Ticketmasters. I was very serious about it because the deal at the time, that suit was actually about how they were lying about, and this is no surprise at all, but they're basically finding ways to fudge and lie about the cost of shipping tickets back when you're getting paper tickets.

0:07:01 Matt: They were just eating money from people basically. And this came out to a big settlement in which it was one of those deals where every person who'd ever purchased a ticket from Ticketmaster got like a special credit in their account that was very hard to use. I don't know if you ever noticed that, but some people probably still have them in their accounts. Because everyone at birth now has a Ticketmaster account, like we're sovereign citizens. That's just how it works.

0:07:14 Thomas: Man you're a signed one you yeah

0:07:21 Matt: Can get away from Ticket Master. That's part of the problem. I want to start with the scope of the program, because this is an antitrust suit under the Sherman Act, which we've talked about before in the context of Google and other companies. Is a monopoly. Live Nation and TicketMaster merged in 2010, and nobody really really seemed to care at the time, but they formed Live Nation Entertainment. And at the time when they merged, you've got Live Nation as the largest concert producer and promoter in the world and already had the second largest ticketing platform. And of course, Ticketmaster was a ticket master. This point now, Live Nation entertainment in 2009 merge, they're now control 60 % of all promotions, 80 % of the ticketing at the largest venues in the country. They own 60 out of the top 100 largest venues, largest amphitheaters, 265 venues and more. Find all these different ways to get fees coming and going, obviously. But back when we cared about this kind of thing, there was this idea of vertical integration, right? The movie studios couldn't own theaters because then they would find all kinds of ways to get money out of people. And this played out in this suit too. Just to give one example, For example, the service fees that we're all familiar with in Ticketmaster, those are from the venues. But if Live Nation owns the venues and

0:08:33 Matt: They're charging service fees, they're negotiating with themselves for service fees and they are double -dipping, and that's one thing that the states are trying to get out of this. But let's back up. A part of this merger, there was a consent decree that the Department of Justice Antitrust Division reached to say basically, we'll let you do this merger if you can promise to be good. Right and of course that didn't work as you might expect um as you would think you start using mob tactics to make sure that venues get in line and use ticketmaster and they'll say great you know you want taylor swift in your city you're going to use ticket master at our venue rather and if you don't use it at your venue we'll make sure it goes to a different venue to us and

0:08:49 Thomas: Great yeah I'm sure now is that a specific example because did she try to take it on for a sec or no I can't remember oh

0:09:11 Matt: Fans did sue over the heiress tour over that gigantic mess um 2022 this did get the states interested. I'm not sure if it was the direct catalyst for this one, but the states I remember at the time, they filed a 128 -page antitrust complaint back in May 2024, that's what this case is coming out of. Two basic claims here under the Sherman Act, and Sherman Act has two main sections that are used. The first is as to anti -competitive agreements, that's section one. Starting to part ways here, but you have DOJ and 29 states that are all trying to get something out of Ticketmaster, and they want different things at point because DOJ is the one that's willing to settle, that's actually trying to force this to an agreement.

0:09:47 Thomas: Wonder why some corrupt bullshit I'm I'm sure.

0:09:51 Matt: I think it's notable when I was going back and researching the person who reached this deal, Sefi is the Assistant Attorney General for Antitrust, who sat down on Thursday and personally negotiated this deal with the CEO of Life Nation, Michael Rapinoe, but didn't tell anybody, including the court, until they got a deal. Didn't even tell a lead counsel from DOJ who's on the case that was seated for a jury last week. This is a full case they were going to be taking to a trial. Finding out as lead counsel the next day that actually we have a settlement out of didn't like it either. When I was looking into Amita Sefi, he gave an interview to Bloomberg last March before I guess he had his current job. Is somebody that was doing anti -trust under the first Trump administration, as well. And he said, I have concerns about the level of corporate capture from the antitrust defense bar, he said. They feel entitled to outcomes.

0:10:22 Thomas: Absolutely ridiculous. What?

0:10:43 Matt: Yeah. And now, a year later, kind of forgetting he ever said that, and he's sitting down with the antITRUST defense bar and reaching an outcome. And this is not the outcome the states were looking for, which is becoming a real mess. So let me tell you kind of what they were suing under, what they're looking for in this lawsuit. And it's what I think all of us want, because Because if you support artists, if you want artists to actually get money, and if you want to be able to pay a reasonable amount of money to go to a show, you should get behind this actual lawsuit, not the settlement. Because the Section 1 violations, we've got these anti -competitive agreements that are forcing venues into these long, exclusive contracts, basically strong -arming them into using Ticketmaster only. And then they're using their own control over the venues they own to force artists to promote their concerts through Live Nation, which is also a promoter. So you've got promoter, ticketer, venue owner basically all being controlled, and if not controlled, strong -armed by the same people. And there's another organization called the Oakview Group here that has essentially become like a captured competitor that is now sort of doing Ticketmaster and Live Nation's bidding. It's become part of the suit too that they're trying to disentangle them. So then the Section 2 violations are pretty serious because that's where the actual monopoly monopoly comes in. And this is where you start to get the mob tactics of using direct and indirect threats to convince venues to sign these agreements and then retaliating. And that was one thing they weren't supposed to do to the point that in

0:10:45 Thomas: That's who's in charge of this?

0:12:14 Matt: An updated consent decree. They went back to court to say that they had caught them doing the kind of stuff they weren't supposed to be doing.

0:12:20 Thomas: Someone actually gave a shit back then?

0:12:21 Matt: Yeah. And they got stronger terms. And of course, the mob tactics continued. But I like the way the New York Times put this in the story I found. The revised decree was designed to make clear the restriction that Live Nation is not allowed to threaten venues in any way and may not retaliate against venues. Just in case you missed it the first time.

0:12:39 Matt: We're getting that in extra ink, I guess.

0:12:39 Thomas: So much lenience, you know, corporations get so many extra chances.

0:12:46 Matt: I mean, I don't think I could get away with threatening happening more

0:12:49 Thomas: Should be like on parole, you Know, and she'd be like, well, we're throwing you in jail now, a corporation. It's so much more you know lenience it's just it's frustrating yeah

0:12:54 Matt: Jail. That was supposed to be the point of the consent decree is this is not a great deal for America, but if you can hold onto these terms, at least like these basic terms that will let you do it and they couldn't do it. That's part of where this lawsuit comes from is that they couldn'T help themselves. There's just, this is what happens. This is the entire point of antitrust law is to keep this kind of thing from happening. Lawsuit, the main thing that DOJ said it wanted and that the states definitely wanted is to break up Live Nation and Ticketmaster, which is what should happen. They should not be the same company. I think that's just very obvious. That is not going to be with the settlement if the settlement is approved, and that's not necessarily foregone. But if the settlement, if it is actually allowed by the judge, who still has to sign off on it, will not split up Ticketmaster. What they were asking for was that, obviously, and then the termination of the agreement with Oakview that I was telling you about, that they've kind of strong -armed to run cover for them and make it look like they're not a monopoly. Elimination of long -term agreements that prevent the competition, so that 75 % of all ticket sales at major venues are locked into Ticketmaster. One for consumers, the end of what they call the Ticket Master Tax, which we all know these fees when we look at our ticket prices. The service or convenience fees, which the complaint does a very good job of pointing out, have nothing to do with service at venues or convenience. It's been a running joke for a long time. But those are set by the venues, which again are owned by the same people who are selling you the tickets in

0:14:20 Thomas: Like it's very convenient for us if you give us money so here you go wow

0:14:23 Matt: That's right. Makes our lives easier. The complaint they actually list out, I wanted to read, all the different things they can call them. Platinum fees, VIP fees, per order or handling fees, payment processing fees, facility fees, and all of these other fees and taxes. And of course in many case the cuts are going to go back to Ticketmaster one way or another. It is, the complaint calls it a Ticket Ticketmaster tax. They want to guarantee an end to the threatening and abusive tactics that Live Nation and Ticket Master were using. The states were also seeking fines as allowed under each of their state laws, which ranged from like $40 ,000 to a million dollars. They didn't really get any of that. So DOJ does this backroom deal, comes back to the court and says, look, here's what we're going to do. We're goingto give you a $280 million fine for a company that made $25 billion last year.

0:15:12 Matt: So less than 1 % of its profits last year, the 40 states get to split up that $280 million, however that works out. Going to divest from 13 of their 60 amphitheaters. That's not enough. At those 13 amphitheater, they're going cap the service fees at 15 % of the ticket price.

0:15:12 Thomas: Come on hmm

0:15:32 Matt: That was across the board what they're doing, but that's not what they are doing. It's just going going to be at some of these amphitheaters with no other restrictions on fees or resale, which is, again, along with breaking up the company. That's one of the big things this suit should be doing. Yeah. And

0:15:31 Thomas: How does this work structurally with the fact that like it'S these other states wanted this to happen you said I I just, how does that work legally? Cause is it ultimately still just like a federal thing or, or how do they, do they get any say what, what's the structure of that legally?

0:16:00 Matt: A great question. And the judge is just now this week trying to figure out what it all means because at least two dozen of the states are saying, we're not playing on this. This is not enough. This isn't the deal we wanted. We're going to trial. DOJ potentially, I mean, it has reached this agreement, but the judge still has to sign off on it. But the judge said this whole thing was dirty and didn't seem right to him. Ordered a status hearing for Friday, the day this airs, where they're going to try to figure out what they're doing. I mean, there's actually, for some reason, there was talk of a mistrial even because of the way this went. You could potentially be in a situation where the federal government reaches a settlement, but big states like California, New York, New Jersey are still seeking their own resolutions on some of these different points. And DOJ was trying to say that maybe it's going to be able to get some of the states to come along with some of this. But, you you still could have individual deals reached. And this matters a lot because some of these bigger states have some of the bigger venues and or have many more venues than other states and might have interest in these deals. And you might even have differences of interest between even the governor that wants a new venue to be built and wants to get along with Ticketmaster and, you now, the attorney general who wants to enforce the law and make sure that they're not doing monopolies. So it gets really messy. See. Ticketmaster, under the terms of the settlement, would have to open up its platform to third -party vendors. It's not really clear what that would actually mean, but allow them to sell tickets on its platform. But it doesn't really matter if they don't have access to the Ticket Master data, because they obviously have massive amounts of our data to figure out ticket prices, who buys what, all the things that would allow them huge advantages in setting their prices and competition. Be a prohibition on retaliation, which doesn't really, I don't know what that even means, because it doesn't seem to be what the states are asking for with these very specific things along the line of the consent decree. And it doesn'T seem to address the problem of the double dipping I was telling you about, where they get to find all these different ways because they're running both ends of all these transactions. Weak stuff

0:17:48 Matt: And this should not be accepted and

0:17:49 Thomas: Seems corrupt. Is it fair to say there's some reason to suspect, you here? I mean, do we have anything firm as to, you

0:17:56 Matt: Point at which you've got the CEO of Live Nation personally sitting down with the DC antitrust guy from the middle of trial as they're about to call witnesses as the jury's been seated and lead counsel for the case doesn't know about it, that doesn't sound right to me if the DOJ lawyer doesn't have that they're doing that, something has to be off.

0:18:15 Thomas: Crazy.

0:18:15 Matt: It is. And the judge said that too, that Monday, they were getting the terms of the settlement and counsel confirmed in court that this is the first heat scene of it too. Yeah. Can't be right for a deal this big and in the middle of a case this big. We'll keep a watch as but if you're in one of these states and you care about these kinds of venues, it's something to watch because right now, this is why you're paying $230. For concert tickets and why the people that you're going to see aren't necessarily even going to receive a lot of that money.

0:18:44 Thomas: Yeah. Those seagulls, are they a seasonal bird or do they? Why did I not notice I thought seagulls were kind of like if they're there they're there I thought it was like if you have seagul if you're a seagal place you got seagals if not do they migrate or something how did how do we start having them I don't it's all I can hear now I

0:18:59 Matt: Not far from the harbor and seagulls love the harbor, but they're having quite a party. Maybe they've got opinions about it.

0:19:06 Thomas: Know but I've never noticed it until like a couple weeks ago

0:19:10 Matt: It has been a lot louder recently. I might have to go check that out and see what they're doing. But the

0:19:13 Thomas: Man it's a gang of youths of ruffian seaguls have come in this place is going to hell Donuts Oh,

0:19:19 Matt: Famously love early nu metal and rap rock, and they heard about this Ticketmaster thing and they're very upset about potentially their Limp Bizkit tickets. So that's what I'm hearing.

0:19:34 Thomas: Know, what comes to my mind and sorry to jump a little bit on a hobby horse, but there's speaking to the to the far left of which I consider myself a part. I am 100 % on board with, with of Democrats in factually speaking, like I'm 100 % On board with how much worse Democrats are than we want them to be, how they fall short. But it's just a couple things in a row here where I'm thinking like, you know, I there's just actually not enough detailed discussion of how bad the right is. I I mean it like because we all have this feeling of like, oh, yeah, well, the right's the right. They're off. They're the Nazis. But like also Hillary and Barack Obama. It's like but if we got into detailed discussion in an appropriate, like way about how many different things having crony, you know, corrupt, fascist bullshit people in power, How many different, unique ways and important ways that they ruin our lives. I think it would make a difference. It's not enough to just be like, oh, well, that side's bad. Sure. But I'm going to police my side. Yeah, I get it. But like, I don't often hear folks like that putting any effort into outlining this kind of thing, like all the different antitrust. And again, left isn't great on antitrust, but they're not this. This, you also I think the the atmosphere on the left has gotten better on this issue. And I would anticipate that if we ever gain control of some levers of power again, that we would be I think they would be a bit better on this issue than they have been in the past, I would hope. That's my feeling just based on kind of zeitgeist and stuff. I could be wrong. Point is, like, isn't enough like detailed, proportional proportional information and discussion of how many different ways things get ruined when fascists who are either corrupt or incompetent or both get control of all these levers of power. It's just it's it's so much that people just can't even keep track of it.

0:21:31 Matt: Fascism by definition includes corporate control. That's That's part of the deal. People forget about that. But that is like, historically, it folds in corporations and they always choose the far right over the far left because they're always going to get a better deal. Of course, we got plenty of Democrats that are bought out. I'm sure there are plenty of Republicans that would have been happy to get behind the settlement. They just don't happen to be in power right now. But I take your point that this is exactly the kind of thing you get when you allow corporations to run your government. Is $300 tickets. That's what what you're going to get.

0:22:00 Thomas: I guess My point is, like, I not trying to tell anyone that they're wrong when they criticize the left because they're not. There's plenty of criticisms, but it's more like if our sense of proportion is wrong, then people a false idea of what the alternative is. If does. And I think that there's so much time spent among certain circles focusing on one bad the corporate Democrats are and the left are. And I get it. And it it I skews when you're not focused on how many different ways because actually takes a lot of expertise and knowledge and journalism to even track down all the different ways that they're screwing us over right guess I just have this feeling of being overwhelmed by it. And I just wish more energy were put into that side of things by, by certain folks is all, maybe it's a niche criticism, but it just occurred to me as, as I was listening to something else today too. It's just like, boy, this is such niche information, you will affect people for like, if this goes through, it affects so many people. And this is just one of a thousand things like this.

0:22:57 Matt: But this is one that's very easy to explain to people because at some point, anybody I want to know at some point wants to go to a concert. I mean, that's just part of life, right?

0:23:04 Thomas: And is one of those things I think appeals to a lot of quote -unquote regular people too like people who aren't super dialed into politics I guess is what I mean by that like you could be like hey look here's here's a thing you could you know this is a good thing to talk to people about I agree it's like here's it here's another way that this corruption affects possibly you

0:23:21 Matt: Yeah. Because it's actually pretty hard to explain it. I'm not really when you sit down, but there's something I want to talk about soon about attempts right now, potentially bipartisan attempts to regulate the equity purchasing up single -family homes. It's a huge problem in this country, right? But explaining private equity, what it is, how it's destroyed the housing market is actually pretty complicated. Enough corruption in our government that Ticketmaster and Live Nation can essentially buy out this incredible deal for themselves and make sure that your Kid Rock ticket costs $300, that's an easy thing to explain to anybody.

0:23:48 Thomas: Fine kid rock should be more nobody should see kid rock pick some pick

0:23:50 Matt: Just thinking of somebody a Trump voter might want to see, I would take no amount of money to go for a Kid Rock show.

0:23:54 Thomas: Yeah okay I didn't know you're actually going for that yeah no one would pay to see kid rock the only people who see kidrock have it foist upon them when they're at a mega rally already

0:24:06 Matt: Have talked about the Super Bowl alternative show. I did watch the Kid Rock portion. Was something.

0:24:10 Thomas: We were gonna do it for where there's woke and then we had too much other stuff going on oh my God I

0:24:14 Matt: It's not worth it. Not worth it, it was hard.

0:24:17 Thomas: Not worth it in what way

0:24:19 Matt: I mean, it's really long. I skipped ahead to the Kid rock part and it just seemed really boring. And then it was just sad. I mean I can't say I felt bad for him, but it's sad.

0:24:21 Thomas: Man. Sounds exactly like what we'd want to do on my first one, but we'll see. Maybe you're right. Maybe we'll spare it. Yeah.

0:24:32 Matt: For like five minutes. Yeah.

0:24:34 Thomas: All right. Well, we'll take a brake. And then after that break, we're going to talk about some AI. It's been a while since we touched on this and it's but in kind of a fun way. We'll see how this goes.

0:24:47 Thomas: Right, Matt, what's going on with AI this time? Time that

0:24:50 Matt: All right. Well, I want to tell you about a pro se litigant. I love this guy. His name is Deference Fivehouse, which is such a cool name.

0:24:57 Thomas: Is a cool name oh

0:24:58 Matt: Is the wrong plaintiff with to because this guy was a JAG. He's a military veteran who was a lawyer in the Department of Defense for a long time. So he knows how to file a lawsuit. It's a little complicated, the thing he's looking for, but it involves their coverage of GLP-1 medication. So he's saying that DOD needs to make better access to GLP ones. Um, obviously I support veterans getting whatever they want. So fine. Uh, that, that seems fine to me. House caught U Assistant U. S. Attorney Rudy Renfer. Is the kind of thing we've been covering now for the entire time we've been talking throughout opening arguments about hallucinations, fabricated quotes, the kinds of things that ChatGPT will make up if you let it do that. And I actually, I spent a long time kind of unrelated to this story, but I was kind of inspired by this story. Spent all my time over the weekend trying to think about how my law firm in particular could start to integrate AI in safe and reliable ways that are not letting it write our legal arguments. Because there are a lot of great ways you can use it. Mean, I've been really impressed by the way you can just feed it an entire thousand page immigration record and then just start asking questions about what's on that record, getting citations.

0:25:53 Matt: I was sort of listening to some podcasts about how to integrate the stuff into your practice. And the guy was making the point that as long as you treat ChatGPT like a particularly smart intern and you supervise it and don't let it write your legal arguments, don't let it do your thinking, but let it help you do your thinking, I think that there's a lot of advantage to this. But this case, like so many others, really points out you can't let It actually do your thinking. US Attorney here, Rudy Renfer, was caught using any number of things and not just in one filing. I'll go through some of these filings in a second. Was, of course, the plaintiff, this former JAG who caught all this, brought it to the court's attention. The court held a very painful show cause hearing this week in which it kind of took and Renfer had to take the stand and testify as to how this stuff ended up in his brief.

0:25:53 Thomas: Sorry wow yeah

0:26:37 Matt: And there he was saying essentially that he had an unfinalized draft that accidentally made it into the record. He was also saying that he was working way too much as is happening with all of DOJ right now. I'm not that sympathetic, but of course they've all got too much to do. I can see the temptation when you're a federal lawyer and this person is not represented.

0:26:54 Thomas: Right. Underestimate them a little bit.

0:26:56 Matt: Maybe you're not really thinking about the fact that he's a lawyer, but like, well, here's a pro -sec guy. I can and do the minimum here and just have ChatJPT help me out. Court's order, the show cause order here that set up this hearing lists out, and we'll link to it, but many things and not just one filing, but much every part of this case, there's different fabricated quotations and false or misleading statements about how this appeared. And he's saying he's dodging the about this. So has actually stepped down. Quit within the last day over this. That is appropriate because he is a federal attorney. He is representing the Department of Justice. Is serious stuff. We talked a couple of months ago about the first instance that we're aware of, of a federal judge potentially, using AI in a decision, and that's much worse than this even.

0:27:41 Matt: But I've been kind of marking these grim milestones as we go here because DOJ, as we've been talking about, is supposed to be held to a higher standard. They're supposed to be the leading government attorneys in the country, and this is the kind of stuff they're doing. Is something to look out for. We knew this was going to happen at some point, the same way that unfortunately we had to know that at some time a federal judge was going use it. But do this, stop doing it. Least check to make sure the cases exist if you're going to do it, but don't do it. The second AI story that I have here is even more interesting. And is another little interesting new milestone. This is another pro se litigant, but she wasn't pro se to begin with until ChatGPT told her to be.

0:28:20 Thomas: See. Even chat GPT doesn't like these people. Hey, maybe you should do this yourself. Yeah, I hear how, you know, maritime law, the flag and then whatever. No, it would be funny though if they built in. You know, I've had this feeling with some of this AI stuff because I use it for certain stuff. It almost all is mainly just home project stuff, computer, whatever. You it gets better and better. But again, the key problem is you don't know where it's doing something wrong. Like that's the problem. It's like, you don'T have any idea which of the parts of it are wrong and what ways and it's getting better .But I mean, I've spent countless hours trying to fix a computer thing where I thought like, okay, chat GPT is helping me. And it just led me astray in one little way that then I was like, well, wait, why don't I just check? And it always takes me way too long to be like, why didn't I just check Reddit on this one particular thing? And then it'll be instantly like, oh, that was the problem. And then of course you tell chat GPG and it's like, Oh yeah, no, totally. Yeah.

0:29:15 Matt: Oh, I knew that. Yeah, right,

0:29:17 Thomas: It's just like, it's so frustrating. Point is, I um, have had this suspicion sometimes that it's It's like, given that it is a bubble and it is going to burst in some way, I mean, it doesn't mean it's useless, but it is a bubble. They're spending way too much money. They're not making any money. I was imagining like, are they going to find ways to not do work? Is it going to find ways to cut corners computationally to save power? I was just thinking, imagine, all right, all these sovereign citizens trying to get chat GPT to write their briefs, just tell them, no. Just write into chat GPT like, hey, No, I'm not going to do it. It's actually dumb. That's a dumb idea. It should do certain stuff like that, you know, save some power.

0:29:56 Matt: Just cut off lines of inquiry. I'm going to say with Google Notebook, which I just learned about, the reason I like that is because it only works from the sources that you tell it to. So if you just give it a 1 ,000 -page PDF plus some case law, or you have it look at Google Scholar or whatever, and again, you still want to check it, and the cool thing is it'll give you footnotes. It'll click through, and you can see the thing that it's citing. You can make sure if it's telling you that something's in the record that that's actually what it is. That's a tool that's not using the brain for you. That's just doing something that a first -year law student intern might do or in a document review, just kind of putting together an index of things for you, so filing, though, District of Illinois, this is Nippon Life Insurance v. OpenAI, and they're suing ChatGPT for a very interesting reason. It's very specific that had reached an agreement through an attorney named Kevin Probst. They'd reached an argument with an insured person named Graciela De La Torre. And De La torre started to think that maybe her attorney wasn't doing her right. So she asked ChatGPT what ChatGpT thought about what her attorney was doing, and she specifically asked about whether she was being gaslighted by her attorney.

0:30:09 Thomas: That's interesting. Oh, wow.

0:31:02 Matt: ChatGpt, of course, generally speaking, I will say LLMs tell you what you want to hear, so it's going to try to go on that one. It analyzed the response and looked at the emails or whatever that she was feeding it, determined that Mr. Probe's response invalidated her her feelings, dismissed her perspective, and deflected responsibility for her dissatisfaction with him.

0:31:19 Thomas: Who knows could be true. Yeah.

0:31:23 Matt: Constituted gaslighting and were aimed at emotionally manipulating her. Which is kind of a weird conclusion for a machine to come to. And then it started providing her with legal advice about how she could reopen this agreement that her attorney had made. So she filed to try to reopen it. These filings with chat GPT and life insurance company figured this out and is suing saying that essentially you've got open AI practicing law.

0:31:49 Matt: It's reached the point at which people are not just using it to check their advice or check their attorneys, but they're using it as a lawyer, which I'm sure plenty of people have. She can't be the first one. Really liked this paragraph here. Is just an informative statement of fact. Chat GPT is not an attorney, Although it was able to pass the uniform bar examination with a combined score of 297, don't know, but a passing, it has not been admitted to practice law in the state of Illinois. ChatGPT is not a member of the Illinois bar. Chat GPT is not a registered attorney. We get it. It just keeps going.

0:32:10 Thomas: That good? I don't know what. Yeah. Yeah. Yeah. Okay. Okay.

0:32:22 Matt: Not admitted to practice in the district court, etc., etc.

0:32:24 Thomas: Neither is a book that you look something up in, but you still, yeah, it just depends.

0:32:29 Matt: Is an interesting extra thing here because a book wouldn't tell you that your attorney is gaslighting you, like

0:32:34 Thomas: It's a book on gaslighting. I don't know. Maybe it would.

0:32:36 Matt: That's true. But that specific thing of like, here's a data set, tell me what's going on here. And that's the kind of thing that you actually would go to an attorney for a second opinion for. And I could look over everything and I could talk it out and I could get a sense of how the attorney was talking to you and I can say, yeah, that makes sense or it doesn't. Many ways in which the bar needs to be more proactive right now in looking out for how people are using this thing because it is going to put us out of business us in many ways. Fewer, I think, than people might think, but we are a lot closer to many attorneys losing their jobs, I Think, than People might understand. And especially these last couple of months, the models that have been coming out, I'm not a big AI booster. I really am very suspicious of it. I do not like it, but it is a tool. I think as a lawyer, I would be stupid to just resist it.

0:33:18 Matt: I was starting to realize over the weekend as I'm kind of listening to other attorneys using this stuff and looking at what the tools actually are. And we have this new client management platform that integrates some of this stuff more. Again, not to do your cases, but just to help you run your firm and to help put things together.

0:33:32 Thomas: Somebody tell me how to get mine out of Gmail. It keeps telling, it's like, here's, here'S the thing. I DON'T mind that it's in Gmail in some way, I guess, if I ask it, I want, I WANT consent. Okay. I want consent. All of a sudden it's underlying Underlying everything as though it's Microsoft Word and it's like a, I'm like, oh shit, did I spell something wrong? Did I do, because I, hey, I want to know. I like grammar and spelling. And then I underline. It's like, you could probably improve this a little. No, screw you. I didn't volunteer. I didn'T ask for you to underline my stuff and give me that panic feeling that I've gotten something wrong only to say like, well, you could probably, for clarity, you can take out all the humanity of your language and

0:33:36 Matt: I hate that. Exactly. Oh yes. Yeah,

0:34:13 Thomas: Write it in a really stupid way that no one wants.

0:34:14 Matt: You're like AI.

0:34:16 Thomas: Yeah. Like, oh, oh cool. Thank you. How do I get rid of that? Damn it. Somebody tell me. I could Google it, but AI will tell me the wrong thing.

0:34:24 Matt: Going to let ChatGPT write my emails. I'm very proud of the emails that I send and I want to make sure that they're coming from a human and we're in a human business. Immigration law is so human and so personal. And I just don't want anybody to think that we're not doing that. The thing you mentioned about Google Gemini, same deal. I was looking for trying to eliminate the Google Gemini results when I Google something and you can't, you just can't turn it off.

0:34:41 Thomas: Can't do it. They don't even let you.

0:34:43 Matt: It's an average of seven seconds of a TV being on every time you use Google Gemini. So we're just non consensually wasting power that I don't wanna, and I don't look at anyway, that's where we're going off, but yeah, I'm with you.

0:34:55 Thomas: That's important.

0:34:55 Matt: Want to have a guest on sometime soon to talk a little bit more about how players can be using this stuff responsibly because it is a little more complicated than just the stuff is always going to make things up or it's always unreliable.

0:35:05 Thomas: It's like you said, I think the way you said it is key. I mean, if you treat it like an employee whose work you can check, I think the problem is when people try to do it to do stuff they have no expertise in, you're not going to know where where it's getting wrong at all. But if you're like, like you, you're an expert in something, or even if you'RE just pretty good in an area, if you're using it casually and and youRE able to like be a supervisor of it, it can be really good. I think that there's also the chance that, I mean, it does keep getting better. I mean theoretically, it could get good enough to where that'S not the case anymore. And it would be a better supervisor than you even would be. I don't know. I think, as not an expert, I feel LIKE there'S limits in that eventually it's garbage in, garbage out like they've they've eaten all the data already and it doesn't you know like I don't know how much more good training data they can get that won't start to also incorporate itself like generated crap

0:35:53 Matt: It's true. Right. Garbage. Yeah.

0:35:55 Thomas: Yeah so we'll see anyway that's just my amateur -esque opinion but uh but yeah I definitely think it'd be foolish to completely resist using it in any way that

0:35:58 Matt: I am with you? I mean, it does does start to feel at some point like, I don't know, I like candles. Why would I put electricity in my house, right? I mean, it's almost that dramatic with some of this stuff because of the improvements you can make and how much more efficient and effective and eliminating human error. I do believe in all that. As you said, as somebody who's an expert who's been doing this for a while, I think it's very responsible in a way that I can guide it to ask the right questions and I know at least what to ask and how to look at a record, but I'm never going to let it replace my brain. And I'm very concerned about people just coming out of law school or people going through law school now. I'm a little concerned about some of these legal boosters that are trying to get it going. But anyway, in this De La Torre suit, I should just wrap this up, essentially saying it's tortious interference. The chat GPD was aware that it was advising on how to reopen a lawsuit that had already been resolved by counsel.

0:36:46 Matt: A very specific kind of claim, and might be something to it. But But of course, that it's unlicensed practice of law. Could see it maybe as some sort of injunction telling selling open AI, if a user is clearly trying to get legal advice, and drafting pleadings obviously is a bad enough, but if it's actually asking you to give a second opinion on a lawyer, I mean, to what degree is that unlicensed practice of law? What degree has that maybe just kind of getting a gut check on what you're thinking about or just kind working through a legal problem for yourself because everybody has a right to do their own legal research?

0:36:45 Thomas: That doesn't seem right. Really? Tortious interference? Right.

0:37:17 Matt: Interesting lines. I'm not really sure how that would be controlled. It's the first time I've ever thought about it. So,

0:37:21 Thomas: Would be weird to say, yes, you can be your own lawyer, but no, you cannot be your lawyer and use this research tool. That seems wrong, but at the same time, like at first I was completely against this, but then when you put it in the sense of, well, it it's illegal to pretend to be a lawyer and give someone advice, right?

0:37:27 Matt: It's a tool, right? Right. Right. It's a felony.

0:37:39 Thomas: Oh, it was a felony. Jeez. That is not just illegal.

0:37:41 Matt: Most jurisdictions.

0:37:41 Thomas: It's pretty illegal. Some sense, I guess that's kind of what it's doing. So, that is a bit of a, that's a decent argument, but I still, ultimately to me, it feels like a research tool and it's like, you should be able to use a research toolbox with the caveat out in the knowledge that it is a research tool hmm

0:37:58 Matt: And it kind of crossed the line here too because Nipon is saying that she not only used it to draft a motion to reopen, but then used it harass them and just file all of this stuff that she never would have been able to file without it.

0:38:08 Thomas: But she's filing it though right yeah

0:38:10 Matt: Yeah I mean, same way that any pro se litigate can just try to file things their own, it's just gonna be more sophisticated. I think they're just annoyed because it's actually pretty good filings.

0:38:18 Thomas: Side of this are you coming down on I don't know because

0:38:21 Matt: The insurance company, usually. Also have to look out for my profession, and I'm a little concerned about how quickly we could be replaced. Maybe some of this stuff should be replaced, but I don't like the idea of people relying on ChatGPT to get legal advice any more than they should to use it as a therapist, right? I mean it's just that we're not there. It's just not a good idea. And you keep hearing these stories about how chatbots are telling people to do these insane things. It's like taking perfectly healthy people and making them believe weird stuff. Don't know, we'll see. Show and when we did our postmortem on Kristi Noem's career, we were talking about her new job as of the Americas.

0:38:53 Thomas: Interesting uh Yes, the shield agent of shield or whatever.

0:39:02 Matt: Yes. And it does look like a marble logo. It's got like a literal shield with the Western Hemisphere in it. This is funny to me. It is like the Board of Peace, which I also want to talk about. The Shield to the Americas and Board of of Peace have, if you don't quite hear them right, it sounds like Shield of America, which is very much what this is. It's like protecting our interests in the Western Hemisphere. Board of Peace literally sounds like you're just Board of Peace, which Donald Trump clearly is.

0:39:23 Thomas: Bored of anything that isn't him for more than two minutes, to be fair.

0:39:25 Matt: That's right. Yeah. Not enough attention. This thing is a made -up coalition. And all coalitions are made up, I guess. But kind of like a random assortment of leaders from the Western Hemisphere that are going to be joining together allegedly to work on fighting narco -terror and cartels.

0:39:45 Thomas: Just want to know, did this exist prior to Trump or do you make it up?

0:39:47 Matt: Literally made it up on the 7th of March, it was announced, in Doral, Florida.

0:39:50 Thomas: I couldn't tell. Yeah. Doral. But yeah.

0:39:55 Matt: Dominican Republic, El Salvador, Guyana, Costa Rica, Ecuador, Bolivia, Argentina, Honduras, Chile. Way.

0:40:02 Thomas: They actually taking part in it? Like, right, something.

0:40:04 Matt: They're all joining. But the criticism here is that this is just sort of a way to strengthen America's... It's imperialism, right? That we're using this coalition to try to fight Chinese economic interests and to generally keep the Western Hemisphere kind right, that's the idea.

0:40:17 Thomas: Thought it was narco terrorists. It's it's. Oh OK. OK.

0:40:21 Matt: But to have them work together under us and give them goodies and military stuff, same way we always have. It's just the Dunrow Doctrine. All over again, right? It's the same thing. I can't believe I just used that in public, but it is the dumb road doctrine also, yeah.

0:40:33 Thomas: I thought you said the dumb row doctrine like our episode. We'll pretend you said that.

0:40:39 Matt: Kind of thing came out when he said, we will not allow hostile foreign influence to gain a foothold in this hemisphere that includes the Panama Canal, which again, the Panama canal is an important asset, but China's kind of making a move. Kind of some suggestion that maybe this coalition might not exactly invade Cuba, but help to overthrow Cuba as well, which is kind of maybe the next target after Iran. So that's something to look out for. It's kind of like the Board of Peace, where it's just kind of this random collection of countries. A political organization. It's not really a legal thing.

0:41:07 Thomas: Guess my question for you would be how much of a job is that like in terms of just her and like her getting demoted? I mean, it actually sounds like it could end up being important. I mean it's in how they're using it, right?

0:41:19 Matt: Why want to keep a look because she shouldn't be doing anything important. It's not really helping

0:41:22 Thomas: Yeah, it's like what if we're like, ah, finally she got fired and then she's like, you know, on board a ship invading Cuba. It's like What? I mean okay, it could be.

0:41:30 Matt: To coordinate the Western Hemisphere invading Cuba.

0:41:35 Thomas: Far off am I? Do it sounds like she could be doing something important there. What is her actual position on it?

0:41:41 Matt: Envoy too, so basically our representative.

0:41:44 Thomas: Kind of funny for us to invent a stupid thing and be like, and we have an envoy to it. Like, we kind of did it though.

0:41:48 Matt: We'll be sending our best, exactly. But notably absent, Mexico and Venezuela. Obviously, Venezuela is not cooperating, but know, Mexico kind of is the heavy hitter here, if you're going to be talking about fighting cartels, given what's going on right now.

0:42:02 Thomas: They, oh, they're not in it. Oh, okay. That doesn't sound good.

0:42:05 Matt: No. So, you Know, it's not really worth that much right now, but we keep a watch. It's just that it was an interesting thing. I just meant to mention that just to follow up from what we talked about on Wednesday.

0:42:12 Thomas: Does she get a jet with it?

0:42:16 Matt: I'm sure she'll find a way to get a jet.

0:42:17 Thomas: Yeah. Where's the budget for that kind of thing coming? Where's the money come for that? You know, that and the board of peace is, is just how are they doing this?

0:42:25 Matt: The Board of Peace was at least created by UN resolution, although I have to to talk about that a different way because I actually don't know who's paying for it, but it's such a random assortment of countries, many of which are not especially associated with peace, us.

0:42:37 Thomas: Like us. Yeah. Oh boy. You know what hit home for me just a quick, not to, not to take too much time, but, I'm aware of how much we suck, but just one of those ways where you're like, oh, is, I was in, you know, in a know reddit talking about hockey stuff and someone mentioned like russia not being allowed to compete and someone's like yeah well we shouldn't either now and I was like oh shit you're right we shouldn't be allowed to complete and like based on kind of the logic of how it's gone I mean yeah at this point we should be not allowed in the olympics like that's a level of bad we are that would be heartbreaking to you know obviously so many athletes and people who care about that but also that is the kind of thing that should happen like is a consequence that needs to happen to our country so that people understand that their their actual consequences were so insulated from everything you it's embarrassing but anyway sorry just a small thing I realized yeah

0:43:30 Matt: We're not Russia, right? Except we kind of are kind of doing the same thing. So let's get on to, speaking things we're doing in the world. Yeah, let'S talk about it.

0:43:33 Thomas: Awful a quick break and get to our footnote all right well we'll take our last break here and we'll get to uh always a fun footnote but maybe not fun we'll see okay good all right matt I was promised fun

0:43:46 Matt: This one's fun. Think it's fun because I didn't know anything about, and again, I'm not a gambler. I'm Not a better, I'M not a trader. I don't know much about how any of this stuff works. I was not aware that the commodity futures trading market is completely different from sports betting or from any other prediction markets, right? Then it used to be like a very academic thing of, you know, a bunch of nerds bet on who's going to be the next president of Venezuela or whatever. It's not a good example because we pretty much know who the next President of Venezuela is going to, but of a democratic country. Commodity Futures Trading Commission, kind of an obscure agency until recently because it's expanded operations to include regulating these prediction markets like Polymarket and Kalshi. Let's just go to Kalsi right now. I hadn't looked at it recently. Let us see what the top bets are at the moment so I can give you an example. Here we go. Contestants on on Survivor Episode 3.

0:44:41 Thomas: That show still going jeez I

0:44:44 Matt: I did not know that.

0:44:45 Thomas: Hope nobody bet on whether or not I knew that show was still going you know yeah I

0:44:50 Matt: I mean, literally, one of the questions is, what will Jeff Probst say during Survivor Episode 3? He uses the expression immunity, I don't know what's going on. Like, how long will the government shut down last? What will Trump say during his remarks in Kentucky. I understand this. Need things to bet on, but it's not betting. So I want to be clear on this. Allegedly, supposedly, what you're doing is you're engaging in a contract. It's the same as a commodities contract where you're betting on what the price of pork bellies or the S &P is going to be in a certain period of time. So I don'T really understand futures trading either, but that's basically it, that you're you're betting on a condition of something in the future.

0:45:04 Thomas: Don't I don'T get it I'm not sure why we're doing this Yeah. I mean, I kind of do understand futures trading. Legally speaking, how is that really different? You know, because you couldn't you phrase sports betting in that way, you know, just rhetorically.

0:45:35 Matt: You could, that's what the states are now starting to move on this because you now on calci, on sports games in places where sports betting is not legal because you're doing it through this market thing. That we're talking about here, people might have heard a little bit in the news, but I just wanted to outline what it actually is. You've got a number of plaintiffs who participated in what they called the Kameni market, which opened on January 8th.

0:46:01 Thomas: Sorry, the what market?

0:46:03 Matt: Kameni Market, so the Ayatollah Ali Kameni.

0:46:05 Thomas: I didn't understand.

0:46:07 Matt: Yeah, right, because that shouldn't be a market. That shouldn't be a thing you should be able to bet on.

0:46:10 Thomas: That should not. My brain was not looking for that to be what it was. OK.

0:46:14 Matt: And isn't the word you're supposed to use. You're trading on these contracts, right?

0:46:18 Thomas: Because, you know, typically I've got a farm, I grow wheat and so I'm going to, you know, buy a futures contract and kind of mitigate my losses if wheat goes down or something. In the same way, same exact, I have a crop full of, you ayatollahs.

0:46:34 Matt: Kamenis?

0:46:34 Thomas: And yeah, it's like the application of the futures stuff does make sense, does serve a purpose, a good purpose, I think even within within markets where farmers did it a lot with, think of if you're a farmer of a certain type of crop, your entire financial wellbeing is tied to one thing, which is not good. So to diversify, you can use these contracts to sort of mitigate like, okay, IF I bet a certain amount that it's going to go down or, you know, whatever, it kind of can insulate you away. It gets more complicated, obviously, but that's a way of insulating you from that, you Know, know, lost, like you're just totally ruined if you're one crop that you grow, for example, tanks. It's funny though, to think of it in those terms. Like, oh yeah, no, I have, see, I grow Ayatollahs. It'S like, I don't, I dunno why that would be what you can also do with it. You

0:47:21 Matt: Don't either. There. And I mean, there was actually the CFTC sued Kalshi a few years ago because they considered, just to kind of set this up, they considered the political betting they were doing. And I just have to keep using the word betting because that is what it is. Betting on the outcome of congressional races. They were saying that that constitutes gaming, which is not something that you're supposed to do with commodity futures. District court in DC actually found that it wasn't gaming because gaming is supposed to be gambling and they are technically contracts that you are trading. It's all very stupid and technical, but that is what you're doing, even though everybody knows what you are doing is betting. And what I thought was especially interesting, went looking into how this all works, CFTC has a rule, Rule 40 .11, that prohibits contracts. This kind of goes to what we were just talking about before the break. Contracts which involve activity that is unlawful under federal state law, terrorism, or assassination, or war. You can't actually take a bet on if somebody is going to be assassinated because if you could take a bed if I'm going to get hit by a car tomorrow, right?

0:48:16 Thomas: Yeah, it's just not a good thing that should be in the world.

0:48:20 Matt: That one along. It's not that hard to find me.

0:48:21 Thomas: Or the way I have bet that you're going to be taken out by a seagull. I've just felt like I mean the the the rate I got on that the odds that they gave me on that were too good to pass up. Yes it's a long shot but like if Matt gets taken out by a seagULL tomorrow I am quitting my job. I don't have to do this anymore. So you know yeah there There you go.

0:48:40 Matt: I I do walk around with food a lot, so really in danger, it's true. I'm putting myself out there.

0:48:45 Thomas: Plus I sent him a gift that was like a seagull attracting like hat. You know, he doesn't know it. Don't tell him anybody.

0:48:52 Thomas: I've laced every gift I've given him with like seagill juice or something. I don't know. Seagull bait. I know what they want. Bread. I don' t know.

0:48:58 Matt: And that is actually part of the problem though with this thing is that there's a possibility here. I mean, there's not really insider trading on commodities markets the same way. But I mean, there's this possibility that people inside DoD where it looks like they were placing bets just before, no question.

0:49:11 Thomas: Were. This is not. Yeah, this is absolute. I mean, sure. You can't prove it. Ironclad, I guess, because it's all anonymous, right? Isn't that that part of it that that also shouldn't be allowed like if if even you're gonna let this exist how could it be anonymous that I don't know why anyone would take part in these markets unless you are literally doing it because you are insider trading you know it's one of those things where it's like you know the house is gonna win right like just gonna lose to baron freaking trump who's got inside info all the the time is making millions of dollars on it. Why would you take part in this? So weird.

0:49:19 Matt: But it has to have been. Oh, no. know what's going to happen.

0:49:40 Matt: Exactly. Right. This should be allowed. I mean and just the idea of betting on somebody's death anyway, it's just morbid. Specific specific question here, just to get to it, was in the committee market, was whether the Ayatollah would leave office as Supreme Leader before either March 1st or April 1st.

0:49:59 Thomas: If you're asking me, Matt, I'm curious for your view. I don't think that's a win because it leave office strongly implies like did it himself. So I actually think leave office. I don'T think that qualifies if If he's bombed, you Oliver, I think, made the joke that he literally didn't leave his office like he was there and was bombed there. You know, like, yeah, I mean, it's not wrong. Like, right.

0:50:20 Matt: Tied there. That's funny. I didn't see that. Yeah,

0:50:24 Thomas: What do you think? Were you coming down the other way?

0:50:24 Matt: But you also, I mean, you can't hold office when you're dead. So, I think it's a reasonable interpretation. I not holding it. It? I don't know.

0:50:30 Thomas: Leave office, though? I If it said no longer be in office. Sure.

0:50:37 Matt: Sure. There's also the other wrinkle to all of this, which is that they came out afterward and they're like, no, we totally didn't mean death, and there was a death carve-out you just didn't notice, allegedly.

0:50:47 Thomas: They had in the fine print.

0:50:49 Matt: But they're saying now that this was not in the user -facing rules or in the contract terms. This is somehow what they're calling uniquely within their knowledge and control. It was buried somewhere.

0:50:57 Thomas: How does that work? It's not even the fine print it's like the implied fine print that you could you know you couldn't read it but like you could imagine it would be there what

0:50:59 Matt: It Yeah. It was a memo to self that we sent.

0:51:08 Thomas: Was in my voice memo yeah it Was in my notes app what it what I don't even understand are they serious that's

0:51:14 Matt: Well, the plaintiffs are making a very good point, which is that on February 28th, they felt like they needed to send out an email to people participating in the committee market the day this happened, in which they admitted, we understand that many users did not have a full understanding for the rules. It's a good reminder. We can always do more. And they had to say again that going to be refunding their fees and that anybody who got these positions are going to be paid out on the last fair price, whatever. They tweeted something on X, which I'll just send you very quickly so you can see the disclaimer that they were trying to do here. Kind of like a last minute reminder. Was on February 28th. I believe that was the morning it happened. Is that right?

0:51:47 Thomas: Would be pretty crazy if they did it before it happened I

0:51:50 Matt: Bombing was on the 28th, so this is that morning.

0:51:54 Thomas: This is a very early morning this is 7:49 a.m. I believe my time. I think, if it's displaying for Pacific, so that's very early. Oh, it did have to happen overnight, right? Yeah, because of the time difference. It says, breaking, the odds Ali Khamenei is out as Supreme Leader. Now, that's a whole different ballgame right there. That I would, I would be with you. If they're saying out as supreme leader, yeah, well, he's definitely out as prime leader. But the wording I heard in particular was leave office, Which I do kind of think is different. But it seems like that doesn't matter. Like, reminder, Kalshi does not offer markets that settle on death. If Ali Khamenei dies, the market will resolve based on the last traded price prior to confirmed reporting of death. What

0:52:41 Matt: Plaintiffs are saying this kind of proves that they understood that they need to cover their asses here because people were betting on death. This is hours before he actually dies. Interesting.

0:52:51 Thomas: Oh, it's before? Okay, they're responding to where they have that back-end data, or well, not even back-ends, I can just see the public price of this proposition has gone crazy. And yeah, okay. I guess it makes sense that they, I mean, they warned before it happened. And I guess, so would they be making the argument like, yeah, well obviously this was the rule because legally speaking, we couldn't have ever been doing a contract bet based on someone dying. Is that what they're trying to say?

0:53:18 Matt: What I'm saying, is that you can't actually bet. And I consider this to be an assassination. I mean, that's what they did. Defense should make that argument. The plaintiffs are not making that argument. But the defendants should come back and say, well, obviously, you can bet on assassination, assassinations and war. Were talking about a political matter. That would be the best defense here, I think.

0:53:33 Thomas: Yep, I would think so. That's probably what they should do. That's interesting, though. I would be curious. Now, maybe this is an impossible question, but like, I'd be curious if this is is a weird way in which if this were gambling, it would be fine. But because it's the contracts futures thingy that you're saying, and you can't have a contract based on something illegal, like an assassination or whatever, that kind of thing. I would wonder if it's, it's a weird world in which it would make, it Would be okay if you were gambling but not if you're doing this.

0:54:04 Matt: Yeah, I don't think there is a regulated... Obviously, you and I could make a bet if we wanted to, but there's no regulated gambling market that would allow that kind of thing. Far as I know, it has to fit into one of these boxes.

0:54:14 Thomas: Right. I was assuming this was that. So to this episode, I literally was thinking that was this. But if it is framed as this kind of contract -y thing, then yeah. Huh. Well, that's interesting. So what's going to happen with this?

0:54:27 Matt: Like I said, I think they have a pretty good defense. I think the plaintiffs have a point too. Markets should be lit on fire and burned to the ground, but that's just me. I don't think they should exist.

0:54:35 Thomas: Keeping in mind, when it comes to Kalshi, if they've said they're refunding their fees, they're not like from this, you know, because it's not as though the Kalschi company is the one that pays out or doesn't. On the other end has to buy the other end of any contract of any quote unquote bet here. So I guess I will say that minorly in their defense, if they refund the fees, which is that's where they're making the money, then they are kind of being like, all right, we'll just call this one a wash and we won't make money on it. It's the people who were like, no, I bet that he was going to be murdered and I should get paid for that it's those people that are going to be out of luck here.

0:55:14 Matt: Want my blood money. Yeah, pretty much.

0:55:16 Thomas: I I earned this blood money fair and square. Yeah, exactly.

0:55:20 Matt: But by knowing it was going to happen and that people working in the Pentagon, I mean, that's...

0:55:23 Thomas: And so screw those people. I don't care. I have no sympathy for that.

0:55:27 Matt: Between the two, I have far more sympathy for the stupid prediction market than I do for people betting on death. So you got me there. I just think these prediction markets are dumb too, but on all their houses.

0:55:33 Thomas: Weird one. I do too. They should not. It's just not good. Yeah I agree.

0:55:39 Matt: Can we put that up there?

0:55:41 Thomas: We're We're going to bet.

0:55:43 Matt: That a plague hits all of their houses?

0:55:44 Thomas: Yeah. Yeah. Is it a plague or a pox? I always thought it was pox.

0:55:48 Matt: It both ways. I don't know. Good question.

0:55:49 Thomas: We got, is this from, from, uh, from Romeo and Juliet, right? Pox on both their houses.

0:55:51 Matt: Romeo and Juliet is not. You're probably

0:55:54 Thomas: Maybe there's a, maybe there's an issue. Maybe there is a folio issue.

0:55:55 Matt: I think you're right. Both right. The original language was a plague on both your houses, but it's often done as plaques.

0:56:04 Thomas: Oh, it's weird that it went that way. I would have thought it would go the other way. You know, like pox sounds less new, you know, let's okay. Well, we're both right. Right, except I'll go ahead and say you were more right because if it was originally played it was originally played there you go

0:56:16 Matt: And now that we've actually lived through a plague, it's a lot worse. So yeah,

0:56:18 Thomas: It's true all right uh well that was really fun that was interesting thanks matt thanks for the breakdown hey thanks everyone for listening we really appreciate you we really appreciate the support on patreon.com/law we are recording a lot awful movies uh really excited to get that out to you uh of course on Patreon those are so much fun yep truly are the best I don't know if we've talked about that before but my favorite lamb is star -studded cast legal movie was terrible like there's no better that's perfect can't wait I'm

0:56:37 Matt: One of my favorites. It's a a movie with a great cast and it looks terrible so yeah I'm I'm ready haven't seen it yet but I'm that's this is how it's looking it

0:56:56 Thomas: Well we will see you folks on Monday and those awful movies sometime soon as well

0:57:00 Matt: Can bet on that all

0:57:02 Thomas: You were saving that one maybe

0:57:07 Clip: This has been Opening Arguments, produced by Thomas and Lydia Smith, with editing help from Peter Baird. The intro is by Thomas Smith. This outro is by Matt Cameron. Support the show at patreon .com slash law. Contact us through Patreon or openarguments at gmail .com. Make sure to follow our blue sky at OpenArgs. But most of all, please share the show. Thanks for listening.