On the eve of Sam Bankman-Fried’s trial, that starts jury selection on Tuesday, rulings by US District Judge Lewis Kaplan start to shape the proceedings of this high-profile fraud case.
To begin with, the disgraced crypto-bro’s defense will not be allowed to blame FTX’s lawyers for the decisions and actions leading to its collapse during the opening remarks.
Coindesk reported:
“Bankman-Fried’s defense team told the Department of Justice and the court earlier this year that he intended to argue that FTX counsel “were involved” in certain decisions that the company made. But this argument, without specifics, may confuse or prejudice a jury, Judge Lewis Kaplan wrote in an order dated Sunday. While he blocked the defense team referring to external counsel in his opening statement, Bankman-Fried’s attorneys can try to raise the issue later if they notify the judge and DOJ first, without jurors in the room.”
The defense plans to argue that both in-house FTX attorneys and lawyers with the firm Fenwick & West were involved in decisions to use auto-deleting messaging services like Signal, loans to FTX and Alameda Research executives, and FTX’s terms of service, among other issues.
“In his ruling, the judge said the phrasing of the various filings raise questions about ‘what would constitute undue focus on attorney involvement’, ‘what could suggest inappropriately that attorneys had blessed a particular course of conduct’ and what legal theory would allow evidence that met the first two questions.
‘Whether and to what extent the defendant should be permitted to argue or adduce evidence regarding the presence or involvement of lawyers will depend on the circumstances. The best that can be done for now is to ensure that the Court will have sufficient notice to make appropriate rulings on a case-by-case basis’, the judge wrote.”
The DOJ flipped three former FTX executives to testify in SBF’s trial: Alameda CEO and one-time girlfriend Caroline Ellison, along with ex-engineering chief Nishad Singh and CTO Gary Wang.
But prosecutors want to put a face to the many victims of the alleged fraud.
Fortune reported:
“In their latest court filing, prosecutors said on Saturday that they plan to call FTX customers to the stand to detail how the exchange’s collapse cost them millions of dollars.
[…] While Bankman-Fried’s defense team and prosecutors have been sparring over which expert witnesses will be allowed to testify, the latest court filing outlines additional witnesses the DOJ is planning to call.
The first group includes ‘multiple’ FTX customers, including both retail customers — who prosecutors say lost tens of thousands of dollars on the failed exchange — as well as institutional customers — who prosecutors say lost millions.”
Prosecutors argue that clients had “expectation and understanding that FTX would custody their assets separate from those of the company, would not transfer customer assets to Alameda Research, and would not use their assets for FTX’s or Alameda’s own expenses.”
Read more about SBF and FTX:
