U.S. v. Samuel Bankman-Fried – Prosecution moves to exclude the testimony of the defendant’s proposed expert witnesses.

I trust no reader of our blog needs a summary of this well-known (not to say notorious) case.  The indictment was handed down on August 14, 2023; trial is scheduled to begin on October 3, 2023.  On August 16, the defendant disclosed seven proposed expert witnesses.  On August 28, the Government filed a motion to exclude all seven of them from testifying.  The motion and the detailed (38-page) supporting memorandum are at https://storage.courtlistener.com/recap/gov.uscourts.nysd.590939/gov.uscourts.nysd.590939.236.0.pdf.  The “Introduction” on page 1 provides a brief summary of the Government’s position:

The defense’s proposed experts and accompanying disclosures suffer from an array of deficiencies that warrant preclusion of all seven witnesses.  For some, the disclosures fail at the most basic level to set forth the opinions of the expert; and most fail to provide a basis for the opinions, as required by Federal Rule of Criminal Procedure 16.  Where the defendant does disclose the expert’s opinions, the opinions are inappropriate subjects for expert testimony, lack a reliable methodology or basis in facts and data, or are irrelevant, unfairly prejudicial, and confusing to the jury.  Among other things, the proposed experts would offer legal conclusions that invade the purview of the Court and the jury, or serve no other purpose than to provide an expert patina to inadmissible hearsay testimony about the defendant’s supposed lack of criminal knowledge or intent.  The Court should exercise its gatekeeping authority and preclude such impermissible expert testimony.

A somewhat more detailed summary of the motion is at https://finance.yahoo.com/news/sam-bankman-frieds-proposed-expert-055605710.html?guccounter=1.  This report identifies the seven proposed experts, their employers (e.g., the University of Michigan) or areas of expertise  (e.g., data analytics), and the Government’s specific objections to each expert.  Of interest, it also provides the experts’ disclosed fees, ranging from $400 to $1000 per hour.  The expert at the high end is a British barrister, and why the defense thinks he’s worth that much is beyond me, as the Government’s objection to his proposed testimony is (in my opinion) beyond dispute:

The defendant intends for Lawrence Akka, an English barrister, to opine that FTX’s terms of service “did not contain a declaration of trust over any fiat currency, but gave rise only to a contractual creditor-debtor relationship,” and therefore FTX “was obliged to honour customer withdrawals … but was not constrained to use fiat currency for any particular purpose in the interim.”…. [Fiat currency is regular money – dollars, Euros, rubles, what have you.  I had to look it up.]

[This] proposed testimony, which is based exclusively on his interpretation of FTX’s terms of service, and which concerns the proper legal interpretation of the terms, and nothing more, is plainly inadmissible under Rule 702.  A fundamental principle underlying Rule 702 is that it is the court’s job to instruct the jury on the law, and the jury’s job to apply the facts to that law.  For that reason, as a general rule, an expert’s testimony on issues of law is inadmissible.  The Second Circuit has repeatedly held that such expert testimony should be excluded.  Indeed, the rule prohibiting experts from providing their legal opinions or conclusions is so well-established that it is often deemed a basic premise or assumption of evidence law – a kind of axiomatic principle.  (Citations and internal quotation marks omitted.)

Vident Partners provides consulting and testifying experts for all types of litigation, both civil and criminal, in all fields of specialization, including unusual or hard-to-find experts (one of our clients calls them pink unicorns).  We also have a strategic partnership with Provider Data Experts, a company that offers expert witness vetting and impeachment reports that are fast, reliable and cost effective.  Check out their website at https://providerdataexperts.com/.


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