After SDNY Indicted Hwang For Archegos $34B Meltdown Now Dozen Motions Denied

More including on co-defendant Halligan here

By Matthew Russell Lee, Patreon Maxwell Book

SDNY COURTHOUSE, March 21 –  In the wake of the Archegos meltdown, the other shoe dropped on April 27, when the US Attorney for the SDNY unsealed and indictment charging Bill Hwang Patrick Halligan, Archegos’s CFO with racketeering conspiracy, securities fraud, and wire fraud offenses.   

 Inner City Press went to the SDNY press conference to ask, What about Credit Suisse and Nomura and people in those banks? What about the massive family office loophope to the Investment Advisors Act of 1940? This has come up in the OneCoin fraud case, on which the Office used perjured testimony and now agrees to delay after delay.

 Damian William referred obliquely to Hwang doing it in the dark, but otherwise the issue - which is addressed by a pending bill in Congress - did not come up. Nor did Lisa Monaco, present in New York for the presser, address it.

On June 1, newly assigned District Judge Alvin K. Hellerstein held a conference in the case. Inner City Press attended and live tweet it here (and asked defense counsel a question later, here). Thread here.

Hwang's lawyer Larry Lustberg predicts robust motions. Hwang's co-defendant Halligan's lawyer says this is like the NBA, sharp elbows. Predicts omnibus motions on/against RICO allegations.

Judge Hellerstein: How about ten weeks from today, you chart your motions, consolidated as much as possible. Aug 9 at 11.

Lustberg: No problem, judge.

 Judge Hellerstein: Maybe we need a list and definition of each alleged misrepresentation.

 AUSA: We expect them to request a bill of particulars.

Judge: Do it before the next conference, and put it on ECF. Maybe on Aug 9, I'll set the trial date. Mr Lustberg, when can you list what you're lacking?

Lustberg: Soon.

Judge: Time excluded until Aug 9. Adjourned.

And after, stand-up here, short Q&A here.

On July 14, Judge Hellerstein approved Hwang's request to be allowed, on three days' notice to the Office of Pretrial Services, to travel throughout the 48 states to "support the poor and oppressed" via Grace & Mercy Foundation.

On July 20 the US Attorney's Office asked to postpone the conference set for August 9 until September 8, saying it has been unable to complete the production of discovery.

And on September 8, with COVID masks voluntary in most of SDNY but in place in this courtroom, this: "Minute Entry for proceedings held before Judge Alvin K. Hellerstein: Pretrial Conference as to Sung Kook (Bill) Hwang, Patrick Halligan held on 9/8/2022. Deft. Sung Kook Hwang pres. w/attys. Lawrence Lustberg, Thomas Valen and Jeffrey Nagel; Deft. Patrick Halligan pres. w/attys. Mary Mulligan and Tim Haggerty; Motions to be filed by 12/2/22; response by 1/12/23; reply 1/27/23; Trial set for 10/10/23; FPTC set for 10/4/23 at 10:00 a.m; Time is excluded until 10/10/23; in the interest of justice."

Jump cut to January 27, 2023, when Lustberg submitted another filing asserting prosecutorial misconduct, specifically misrepresentations that Hwang was a subject, not a target, of its investigation, and that the US was open minded about whether or not to charge Hwang. This could often be said or alleged.

On February 7, Judge Hellerstein citing time conflicts on the part of counsel pushed the trial into 2024: "SCHEDULING ORDER as to Sung Kook (Bill) Hwang, Patrick Halligan. A conflict with another trial having arisen on the part of counsel, trial in the above-captioned criminal matter is adjourned from October 10, 2023 to January 9, 2024 at 10:00 a.m., in Courtroom 14D; the Final Pretrial Conference will be held on January 3, 2024 at 2:30p.m. Time is excluded in the interest of justice from October 10, 2023 to January 9, 2024 pursuant to 18 U.S.C. § 3161. The pending pretrial motions will be heard as previously scheduled. (Signed by Judge Alvin K. Hellerstein on 2/7/2023)."

On March 21, 2023 Judge Hellerstein held an hour and a half proceeding in which he denied more than a dozen motions by Team Hwang. Inner City Press was there are live tweeted, thread here:

OK- now Bill Hwang of Archegos arguing for dismissal of criminal fraud case against him.

Hwang's lawyer Lustberg: There was no spoofing here. There were no false statements. AUSA Podolsky cites a 2008 decision by Judge Rakoff sitting by designation on the 2d Circuit, on 10(b)(5).

Judge Hellerstein: I find that fraud is sufficiently alleged.

Halligan's lawyer cites a Judge Patterson decision on RICO Section 1961(1)(b). Judge: After biological weapons?

AUSA: 6 lines below that. And the PSLRA amendments took this right from civil litigants...Mr Hwang wanted to control the market. It was pump and brag

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 Judge Hellerstein: My ruling is that the indictment is legally sufficient. Defense sputtering about Count 10, citing 2d Circuit Charles Schwab case

Judge Hellerstein: Motion denied. I'll issue a short summary order- until then I reserve the right to change my mind

 After that, a motion for a hearing on alleged prosecutorial misconduct was argued - Lustberg said the AUSAs never said when Hwang became a target, not subject, but continued to elicit information right until the indictment, and even after (it was sealed). Denied. Final pre-trial conference is set for January 5, 2024.

more here