This Day in Legal History: Happy Birthday RBG!
On this day in legal history, March 15 marks the birth of an iconic figure in American jurisprudence, Justice Ruth Bader Ginsburg, born in 1933 in Brooklyn, New York. As the second woman ever appointed to the U.S. Supreme Court, Ginsburg's legal career was marked by a steadfast commitment to justice, equality, and the rule of law. Before her appointment to the Supreme Court in 1993 by President Bill Clinton, Ginsburg had already made significant contributions to the legal field, notably through her work with the Women's Rights Project of the American Civil Liberties Union during the 1970s.
Her strategic litigation before the Supreme Court as an attorney broke down numerous legal barriers, leading to greater gender equality. Justice Ginsburg's opinions, both majority and dissenting, on the Supreme Court bench were known for their clarity, depth, and unyielding dedication to civil rights. Notably, her dissent in cases like Ledbetter v. Goodyear Tire & Rubber Co. inspired legislation to ensure fair wages for women, highlighting her influence extending beyond the judiciary to the legislative domain. Ginsburg's legacy is not only embedded in her monumental judicial writings but also in her role as a cultural icon, affectionately dubbed "Notorious RBG," symbolizing her enduring impact on generations of lawyers, activists, and ordinary citizens. Her passing in September 2020 was mourned across the nation, reflecting the profound loss of a legal titan who dedicated her life to advancing equality and justice for all Americans.
The IRS, in collaboration with the Department of Justice, has initiated a significant enforcement push against crypto tax fraud, marking a new phase with the first standalone criminal charges in this domain. Frank Richard Ahlgren III from Austin, Texas, faced accusations of underreporting or failing to report over $4 million in Bitcoin sales for the years 2017 and 2019, along with significant capital gains derived from these transactions. This case is notable as the first instance where charges were made solely for failing to accurately report cryptocurrency earnings and gains on tax returns, signaling the IRS's increased focus on tax compliance within the cryptocurrency sector.
The IRS has been enhancing its efforts in understanding and regulating the cryptocurrency market, issuing guidelines on crypto staking and proposing rules for broker reporting, which would mandate exchanges to report user transactions and identities. Experts see this as a major advancement for the IRS, reflecting years of building technical resources and expertise to tackle crypto tax fraud independently, without relying on other criminal investigations.
Tax compliance for cryptocurrency can be complex due to the difficulty in tracking the purchase and sale history of digital assets, complicating the determination of tax obligations. Despite misconceptions about the anonymity of crypto transactions, the IRS is actively disproving this narrative, hiring industry experts to deepen its understanding of the space and strengthen its enforcement capabilities.
The Ahlgren case, if it proceeds to trial, will pose a significant challenge in educating the jury about the intricacies of cryptocurrency, setting a precedent for future prosecutions. Legal and tax professionals are closely monitoring this development, anticipating more actions from the IRS as it continues to target underreporting and tax evasion within the rapidly evolving cryptocurrency market.
IRS’s First Crypto Tax Charge Signals Beefed-Up Enforcement Push
Walt Disney Co. is employing an unconventional strategy in its fight against activist billionaire investor Nelson Peltz, by reviving the character Professor Ludwig Von Drake, Donald Duck's uncle, to influence its shareholders. In an effort to counter Peltz and nominees from the Trian Group and Blackwell, Disney launched a social media campaign urging investors to support only Disney's board nominees for the upcoming annual meeting on April 3. This marks a significant move by Disney to not just appeal to institutional investors but also to the retail ones, highlighting the importance of every vote through the creation of votedisney.com and engaging storytelling involving classic characters.
Peltz, known for his aggressive proxy battles, including a notable one with Procter & Gamble, aims to instigate major changes within Disney, criticizing its lagging profit margins compared to other media giants and calling for restructuring across its business lines. Disney’s campaign is a testament to the gravity with which it views Peltz's challenge, employing tactics like political-campaign-style videos to directly address and counter Peltz's and his allies' propositions.
The company has gone further by attacking Peltz and other nominated board members, labeling some as "disgruntled former employees," thereby illustrating the personal stakes involved in this boardroom battle. Peltz, in response, has launched his own website and published a manifesto highlighting Disney's operational missteps under CEO Bob Iger, advocating for significant structural reforms, especially in its studio operations.
The discourse between Disney and Peltz mirrors political campaigning, with both parties securing endorsements and presenting detailed plans for Disney's future. Disney has rallied support from significant figures, including members of the Disney family and influential business leaders, to bolster its position ahead of the shareholder meeting. The contention underscores the broader issues of governance and strategic direction at Disney, especially concerning succession planning and operational efficiency.
Key to understanding the drama at Disney is the universal proxy card rule. The universal proxy card rule allows shareholders in a contested election to vote for a combination of management and dissident nominees using a single proxy card. This rule aims to ensure fairness and transparency in proxy voting by enabling shareholders to cast their votes more accurately according to their preferences, regardless of whether they attend the shareholder meeting in person or vote by proxy. By providing a unified method for proxy voting, the universal proxy card rule enhances shareholder democracy and facilitates more meaningful participation in corporate governance decisions. The rule enables institutional investors to consolidate their voting power across multiple shareholders, facilitating their ability to influence corporate governance decisions and effect significant changes within a company.
The ongoing proxy fight, accentuated by the universal proxy card rule, represents a crucial juncture for Disney, reflecting the intricate dynamics of shareholder influence, corporate governance, and the power of narrative in determining the future trajectory of one of the world's most iconic entertainment companies. As the April 3 meeting approaches, both Disney and Peltz remain steadfast, each confident in their vision for the company's future.
Disney Revives Donald Duck’s Uncle for Showdown With Billionaire
Justice Sonia Sotomayor's recent public comments about feeling "tired" and the workload on the Supreme Court have sparked quiet concerns among progressives, reminiscent of the anxiety surrounding Justice Ruth Bader Ginsburg's refusal to retire during Barack Obama's presidency. Despite Sotomayor nearing her 70th birthday, there's little pressure from progressives for her to step down before the November election, which could see a shift in control to the Republicans. This situation echoes past regrets over Ginsburg's decision to stay on the court, which ultimately led to a conservative shift following her death.
The hesitance to call for Sotomayor's retirement stems from the sensitivity around advocating for the departure of the first woman of color on the Supreme Court. There's an ongoing conversation within progressive circles about the strategic timing of Supreme Court retirements, though public discussions are rare. The Supreme Court's role as a pivotal policy-making entity in the country adds to the complexity of suggesting a justice's retirement, as it feels akin to a personal attack on their legacy and contributions.
Not everyone supports the idea of Sotomayor stepping down, considering she is not the oldest nor the longest-tenured justice on the bench. Concerns about her health, given her Type 1 diabetes diagnosis, don't seem to impact her ability to serve, yet there's speculation about whether she'll want to continue for several more years.
Historical precedents of justices retiring under like-minded presidents, or due to health issues at politically inconvenient times, provide a mixed picture on the predictability of Supreme Court retirements. The possibility of Sotomayor retiring to ensure a successor aligned with her views is debated, especially considering the potential for political shifts in the Senate that could impact the confirmation process.
Calls for Sotomayor's retirement are few, partly due to the fear of repeating accusations of bias that emerged during discussions of Ginsburg's tenure. The current political climate, with an upcoming tight presidential election and competitive Senate races, makes the timing of any retirement particularly consequential. Advocates for Sotomayor's retirement emphasize the strategic benefit of ensuring a like-minded successor, acknowledging the uncertainty of future political landscapes and health concerns. However, expecting a justice to retire in an election year is seen as unusual, highlighting the delicate balance between judicial independence and political strategy.
Quiet Fears About Sotomayor Echo Ginsburg Retirement Concerns
A federal judge in Florida, U.S. District Judge Aileen Cannon, denied former President Donald Trump's request to dismiss a criminal case against him related to the possession of classified documents after leaving office. Trump's legal team had argued that the charges were vaguely defined, but Judge Cannon, appointed by Trump himself, found the issue warranted consideration but was not grounds for dismissal at this stage. Trump faces a 40-count indictment, accusing him of illegally retaining sensitive government documents post-presidency, marking one of four criminal cases against him as he campaigns for reelection.
Judge Cannon also addressed Trump's claim that the documents were "personal" rather than government property, suggesting this argument could be explored during the trial rather than leading to an outright dismissal of the case. Trump has actively filed legal challenges across his multiple criminal cases, arguing, among other points, that a trial should be postponed until after the election. Notably, if reelected, Trump could potentially halt the federal cases against him, though state law cases would remain unaffected.
The timeline for the trial remains uncertain, with Special Prosecutor Jack Smith proposing a July start, while Trump has suggested August, emphasizing his preference for a post-election trial. Trump's legal strategies have seen varied success in other cases, including a pause in a federal case about the 2020 election results pending a Supreme Court decision, and complications in a Georgia state election subversion case due to procedural issues. Additionally, Trump's New York state trial concerning hush money payments has faced potential delays.
Judge denies Trump motion to dismiss classified-documents case | Reuters
This week’s closing theme is by Hector Berlioz.
The most famous classical piece associated with the Ides of March is likely the "Ides of March" movement from Hector Berlioz's "Symphonie Fantastique." This movement is part of a larger symphony that tells the story of an artist's obsession with a woman. The ominous and foreboding tone of the "Ides of March" movement captures the sense of impending doom often associated with the Ides of March, famously known as the date of Julius Caesar's assassination.
Hector Berlioz, born in 1803, was a pioneering French composer, conductor, and music critic of the Romantic era. Renowned for his innovative orchestration and dramatic flair, Berlioz revolutionized symphonic music with his groundbreaking compositions. His masterpieces, such as the "Symphonie Fantastique" and the opera "Les Troyens," showcase his vivid imagination and emotional intensity, earning him a lasting place in the classical music canon. Berlioz's unique style, characterized by its grandeur and expressiveness, continues to inspire and captivate audiences worldwide, cementing his legacy as one of the most visionary composers of the 19th century.
Without further ado, the second movement from Hector Berlioz’s “Symphonie Fantastique,” enjoy.
Legal News for Fri 3/15 - IRS Targets Crypto Tax Fraud, Disney vs. Peltz, Sotomayor Retirement Chatter and Trump's Classified Docs Case