During the 18 months of the Special Counsel Robert Mueller‘s investigation, a cottage industry has emerged to decipher the famously tight-lipped former FBI chief’s ongoing probe: Call them the Muellerologists. We’ll be checking in with them periodically, as the investigation approaches its climax (or so we think).
In this edition: The mysterious case of the secret subpoena.
So far, perhaps no plot note in the Mueller probe has proved more intriguing, or furtive, than a sealed federal court case believed to be related to the Mueller probe; the parties in the case, and the specifics of the legal conflict, remain secret. The existence of the case, known simply as “In Re Grand Jury Subpoena,” was first reported by Politico in October, leading some to speculate that President Trump himself may have been subpoenaed. That now seems unlikely: In December, a ruling from the DC Circuit Court of Appeals—taking extraordinary measures of secrecy, including clearing out the courthouse during the hearing—offered a glimpse into the proceedings, with an unnamed company (“the Corporation”) owned by a foreign country (“Country A”), which was found in contempt for resisting a grand jury subpoena.
This week, the drama intensified, when the Supreme Court signaled an interest in the case. In a court order issued Sunday, Chief Justice John Roberts granted a stay to the contempt finding, and requested briefings on the case by December 31. Before the Supremes had a chance to weigh in, we had asked our panelists: What’s going on in the mysterious case? And what does it tell us about the direction of the Mueller probe?
‘That the mystery subpoena could relate to several countries is itself what is significant’
Alex Whiting, professor at Harvard Law School, and former federal prosecutor with the Criminal Section of the Civil Rights Division and the US Attorney’s Office in Boston.
From the few clues that we have, it seems likely that the subpoena at issue pertains to the Mueller investigation, but it is difficult to know what corporation or company it involves. And that is perhaps what is most striking about this episode: it underscores the broad reach and scope of the Mueller investigation. The country could be Russia, Turkey, or Ukraine. These are certainly the leading candidates, though not the only ones. But even narrowing it down to these three is a reminder of the many different activities that are currently under the Mueller microscope. Does the subpoena pertain to Russian efforts to disrupt the election or hack the emails of the DNC? Does it pertain to the failure of Michael Flynn and others to register as lobbyists on behalf of Turkey? Or could it be about Paul Manafort’s criminal dealings on behalf of Ukraine? All of these matters are the subject of criminal charges already brought by Mueller, and in some cases proven by convictions or guilty pleas. That the mystery subpoena could relate to several different countries is itself what is significant here.
‘Two possibilities seem realistic’
Paul Rosenzweig, Senior Fellow, R Street Institute, and former senior counsel to Kenneth Starr during the Whitewater investigation.
The official answer is, of course, that nobody knows for sure. But since we are speculating, here are a few pretty interesting clues: 1) The corporation almost certainly doesn’t do a lot of business in the US. If it did, it would be much less likely (and able) to resist. So it’s an overseas organization. 2) It really is owned by a foreign nation—the way the court’s opinion is written suggests that the idea of foreign sovereign immunity was not a make-weight fiction, but a realistic argument. 3) A weaker inference is that the nation controlling the corporation is unfriendly to the US. If they were a close ally they would have given up the information more readily. And 4) It’s relevant to Mueller’s investigation, so it’s unlikely, for example, that the country involved is China, even though it fits the rest of the profile, because nothing related to China appears to be in Mueller’s remit (at least not that we know of publicly).
So what does that mean? Two possibilities seem realistic. One, less likely at a guess, is that the subject is a sovereign wealth fund in the Middle East (like Qatar, UAE or Saudi Arabia) and the subject of the investigation is related to the Trump/Kushner investments in that region. The other, more likely to my mind, is that this involves investments in Russia—and that makes [me] think that, more likely than not, this involves a Russian corporation like Rosneft, the Russian oil and gas giant which has appeared at the fringes of some of the investigation. But as I said, nobody knows for sure.
‘Mueller is trying to complete the circle’
Patrick Cotter, defense attorney, former federal prosecutor and a trial prosecutor in the case U.S. v. John Gotti.
The identification of the Mystery Company A as being owned by a foreign government is not, really, a surprise. There have been clear signals in earlier Mueller filings that he is looking into the intersection between Trump-related entities (the campaign, his private business) and Russian persons and entities, especially Russian persons and entities with connections to the Russian government and/or its leaders. Indeed, Mueller has already indicted a number of Russian citizens and companies, some with documented connections to Russians high-placed in the government. So, the fact that he is currently engaged in a legal fight for records with one foreign company, which is apparently actually owned outright by a foreign government, does not seem too large a leap forward.
For the forgoing reasons, my guess is that the company is Russian owned, though perhaps I will be surprised. But I doubt it.
Also, for the same reasons, I think these developments confirm the direction of Mueller’s probe we have all known of for quite some time, which is to methodically and thoroughly build evidence of the actions and participants in the collusion on both the US side (e.g. Flynn, Papadopoulos, Don Jr.) and the Russian side (e.g., the previously indicted Russians and Russian entities, Kislyak, Company A). Mueller is, quite appropriately, trying to complete the circle of all those involved in the conspiracy to attack our electoral process.
This is what all good prosecutors do. For example, you do not want to just identify and arrest the guys who received the shipment of illegal drugs; you want to identify and, if possible, indict and even arrest the people who sent the drugs, even if they were, and are, outside the USA. Any prosecutor wants to be able to tell the whole story of the crime, if possible, because that makes for the strongest case. And that is what Mueller is doing.
‘This could relate to Russia, Turkey, or UAE’
Barbara McQuade, professor at University of Michigan Law School, and former United States Attorney for the Eastern District of Michigan.
The substance of this opinion is somewhat of a mystery because of the secrecy rules that surround grand jury matters. All we know is that a company that is owned by a foreign government has been subpoenaed to produce documents and now compelled by the court to comply with the subpoena. This could relate to Russia, Turkey, UAE, or any other country. We know from public reporting that the special counsel is investigating some threads relating to WikiLeaks, the Trump Tower project in Moscow, and the meeting with a Russian businessman in the Seychelles, and may be investigating other threads as well. The documents at issue are likely business records of some sort that could shed light on any area of investigation. A grand jury subpoena may be used if there is a reasonable possibility that the information sought is relevant to an investigation. Without seeing the subpoena, it is impossible to know who or what is involved.
‘Rosneft, the state-owned oil company?’
Harry Sandick, defense attorney and former federal prosecutor for the Southern District of New York.
Exceptional steps were taken to protect the confidentiality of this appeal: the courtroom was cleared, the lawyers were permitted to enter the courtroom through a non-public elevator, and as a result, it is hard to say with certainty what country and state-owned business were contesting the grand jury subpoena.
The news about the appeal tells us a few things about the Mueller investigation. First, it is a reminder that the Mueller investigation has taken all possible steps to maintain the confidentiality of its investigation. In an era during which information can spread quickly, this reflects very well on the prosecutors and their appropriate respect for the need for secrecy when conducting a grand jury investigation. Second, it teaches us that the Mueller investigation has been willing to use the power of the court to enforce its subpoena, even when this has resulted in lengthy and no-doubt time-consuming legal proceedings. One can infer from this that the Special Counsel believes that these documents are important to its investigation, not merely useful or relevant. Third, we can see the international nature of this investigation. Fourth, it indicates that the Mueller investigation is not yet finished with its investigation, as it is continuing to seek documents by subpoena, at least from some witnesses.
As to the identity of the country or its company, there have been many good guesses raised by different observers (Rosneft, the state-owned oil company? A sovereign wealth fund from the Middle East?) but no one knows for sure and we may not know for a long time.
The mystery corporation’s argument is similar to those ‘advanced by Chinese banks’
Nick Akerman, former federal prosecutor in the Southern District of New York and member of the Watergate prosecution team.
My most informed guess is that this was a subpoena for documents from a bank in China or another country that owns a bank and has a branch office in the United States. It would appear that Mueller served a subpoena on a bank in the US (the Corporation) that is the branch of a foreign bank owned by the foreign government in order to obtain records maintained in the bank outside of the US.
The Circuit Court reviewed an “ex parte submission” from the government, presumably Mueller’s office, and found that it “satisfied its burden of establishing a reasonable probability that this ‘action is based upon . . . an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere’ and that the act cause[d] a direct effect in the United States.”
The other clue is the claim by “the Corporation” that complying with the subpoena “would require the Corporation to violate Company A’s law.” This is typically the argument advanced by Chinese banks in opposing US civil and criminal subpoenas for customer information held in China. A similar argument might also apply to other countries with state-owned banks.