Tesla Under Investigation for Securities Fraud & The FBI's Failures in the Larry Nassar Case - Ep. 51
Download MP3Welcome to Litigation Nation. I'm your host, Danessa Watkins, here with my co host, Jack Sanker. And as a reminder, this is the show where we cover the hot exciting legal issues across the nation, and keep you updated on what's going on. So, Jack, what are you covering today?
Jack Sanker:So Tesla is in the news again, this time for potential securities and wire fraud investigations relating to the advertising of its full self driving features.
Danessa Watkins:And I'm also actually covering a DOJ case. Recently, the justice department entered into a $138,700,000 settlement over the FBI's failures in the Larry Nassar case. All that and more, here's what you need to know.
Jack Sanker:As I mentioned in the intro, Tesla is back in the headlines. It seems to always be. And, this time over the ongoing investigation from the Department of Justice and the SEC relating to its marketing efforts and some of the statements made by its executive and, founder, Elon Musk, specifically as to Tesla's self driving capabilities, which is a a key element of their, marketing for the automobiles that they sell. According to an article that was published in The Verge just a couple days ago, Tesla is under scrutiny from the DOJ for its claims that its vehicles would be self driving within a set amount of time. And and I should note that on this particular claim by Tesla, it's it's always been a moving target, based on the public statements of its founder and CEO, Elon Musk.
Jack Sanker:For example, in 2016, he claimed in an interview that full self driving status would be, you know, quote, no more than 2 years away. That's 2016. We're recording this in May of 2024, and, obviously, we're not there yet. He's made a lot of other claims along the way to the effect that full self driving capabilities will be forthcoming over the past few years. And in my observation, in my opinion, usually those statements come out around the time of big investor actions or shareholder votes or, you know, earnings calls, things like that.
Jack Sanker:So that's the kind of the crux of this investigation is, broadly speaking, whether the market is being manipulated by these statements, this this kind of optimism around Tesla, around a product that it may or may not really be close to putting out. So going back to the Verge story, quote, according to Reuters, the probe is looking into statements made by Tesla CEO Elon Musk in particular. For years, Musk has been promising fully autonomous Tesla vehicles are just around the corner while also admitting that he often sets overly optimistic deadlines. Meanwhile, the company's advanced driver assist features, autopilot and full self driving, do not make the vehicles autonomous and require drivers to keep their hands on the steering wheel and eyes on the road, unquote. Now the verge report was published, just a day ago on May 8th.
Jack Sanker:We're recording here on May 9, 2024, and the verge report relies pretty heavily on Reuters reporting going all the way back to 2022 when the criminal investigation by the DOJ was actually launched. The reason it's back in the news is based on, some insider and, sources that have been leaking some things to Reuters and also some news about new subpoenas and document requests and things like that. Quoting from the Reuters report from earlier this month, quote, there are Tesla videos demonstrating the technology that remained archived, opens on the Tesla website in a new tab, which says the person in the driver's seat is only there for legal reasons. He is not doing anything. The car is driving itself.
Jack Sanker:A Tesla engineer in 2022 in a lawsuit over a fatal crash involving autopilot that testified that one of the videos posted in October of 2016 intended to show the technology's potential and did not accurately portray its capabilities at the time. Musk, nevertheless, posted the video on social media writing, quote, Tesla drives itself, no human input at all, through urban streets to highway streets, then finds a parking spot. In a conference call with reporters in 2016, Musk described autopilot as probably better than a human driver. And during an October 2022 call, Musk addressed a forthcoming, FSD upgrade, and parenthetical f FSD means full self driving. A forthcoming f s FSD upgrade that he said would allow customers to travel to your work, your friend's house, or to the grocery store without you touching the wheel, unquote.
Jack Sanker:As my own personal experience, I've I've been in a Tesla before. They are pretty cool vehicles. But in what I think the consensus is that they are far short of this, you know, full self driving capability. They seem to have, the autopilot system is is pretty neat, to to experience firsthand. But it's not far off from what a lot of competitors are have already been including in their vehicles for a long time, and they don't market market those things as full self driving.
Jack Sanker:Things like lane assist, smart, cruise control, things like that. Those are all features that a lot of other vehicles have, even my, like, 2018 Subaru does. So it's just anecdotally, it it doesn't seem to it it does sell set itself apart from what other folks are doing, but I think we'll get into it in a moment what some competitors have already put out there that they're not calling full self driving is in some ways exceeding what Tesla is able to do at this point. So on the investigation itself, the Reuters report summarizes some of the goals and challenges that the probe may have pretty nicely. Quoting back from Reuters quote, the investigators will need to demonstrate that Tesla's claims crossed the line from legal salesmanship to material and knowing false statements that unlawfully harmed consumers or investors, 3 legal experts uninvolved in the probe told Reuters.
Jack Sanker:US courts have ruled that puffery or corporate optimism regarding the product claims did not amount to fraud. In 2008, federal appeals court ruled that statements of corporate optimism alone do not demonstrate that a company official intentionally misled investors. Justice department officials will likely seek internal Tesla Communications as evidence that Musk or others knew that they were making false statements, said Daniel Richmond, a Columbia Law School professor and former federal prosecutor. That is a challenge, Richmond said, but safety risks involved in overselling self driving systems also speaks to the seriousness with which prosecutors, a judge, and a jury would take the statements, unquote. So this is a kind of a classic case of, the executive as a salesperson for the company and his cheerleader for the company, maybe making some claims that aren't gonna be backed up by what the company can actually do here.
Jack Sanker:And that's a problem for everyone involved, lest you think that this is, you know, a Tesla hater podcast, which it's not. But it's a problem for even for anyone listening because of the way in which Tesla has been integrated to the US economy and the size of the company. So it's has a market cap of, I think, close to a $1,000,000,000,000, if not more. I have checked recently. It wasn't one point the most valuable company company on the planet despite the fact that it's selling significantly less vehicles than even a company like, you know, say, Toyota or or GM or whatever.
Jack Sanker:So that the share price and the investor optimism around this is based almost entirely on this claim that the vehicles are gonna be self driving sometime in the very near future. And that's been driving Tesla investment for the past, you know, 10 years. If indeed it's not the case that Tesla is really even close, and I I I don't know one way or the other. I mean, maybe they'll launch it tomorrow. You know?
Jack Sanker:Who knows? But if they're not close, that's gonna hurt the share price pretty dramatically because what's priced into that share price, obviously, is the full self driving capability. Without that, it's just an electric car company. And and, you know, it was pretty early to the market for electric vehicles, but there are a lot of, EV competitors out there now and many of whom are, offering, the same capabilities from just the electric vehicle perspective. It seems like every automobile automobile manufacturer is doing that already.
Jack Sanker:So the issue and the real harm here that the DOJ is investigating is how that's gonna how these statements from Musk and and probably others within the company have maybe inflated and maybe illegally inflated, the share price. And as I mentioned, it does seem like these statements tend to come out whenever there is a shareholder vote, whether it's to do with executive compensation for Elon, specifically or, the the issuance of more shares or around earnings calls, things like that.
Danessa Watkins:So when I was listening to you talk, Jack, I I was gonna ask you if this is gonna potentially lead to shareholder suits, but I just jumped on Google real quick and found that, well, Forbes in February of this year was reporting on an update about the shareholder suits. So there have been suits filed. One seems to be related to these mischaracterizations by the CEO and other higher ups in the company. But it looks like this was filed in, I think, California. But because that's I guess, couple of plaintiffs, the the contracts that they signed have an arbitration clause.
Danessa Watkins:It looks like the judge is not approving the class action suit, and it's gonna have to go to arbitration. The other ones are focused on injuries. Let's see. There was a return in April of 2023, finding that Tesla was not responsible for a crash that occurred in 2019 where the driver died. There's been a couple other suits like that, and it looks like Tesla has not been held liable.
Danessa Watkins:But, yeah, there's certainly both, the Department of Justice and shareholders paying attention to these potential misstatements.
Jack Sanker:Yeah. I mean, I know that Tesla gets a lot of attention. And every time there's a crash involving Tesla and and maybe involving autopilot, there's a lot of media scrutiny around it one way or the other. And whether that's fair or not, you know, I don't know because I'm not tracking, you know, how often there's a manufacturing issue with, you know, a Toyota or a Subaru or whatever that that leads to a car crash, you know, to compare it to to the frequency that's happening with Tesla. You know, I I don't know, whether it's higher or lower than what you than the margin of error that we kind of all accept.
Jack Sanker:So I don't I don't wanna, like, dwell on the specific instance. Since, although we have covered them in the past of the, the crashes involving Tesla, things like that. I know there have been a bunch of interesting allegations. One one which is that when a Tesla isn't engaged in autopilot and is involved in a crash, it's, it automatically turns off the autopilot, like, in the split second before the crash so that when you go and look at the, like, black box data, it'll show that autopilot was not engaged.
Danessa Watkins:My gosh.
Jack Sanker:Yeah. I mean, I don't I don't know if it's been substantiated, but that was an allegation. So, yeah, the point is, the if, you know, if Tesla self driving cars were a thing, right, tomorrow, it would be a huge deal. Right? It would the roads would be would theoretically be safer.
Jack Sanker:Everyone would go buy a Tesla if they could afford it. It it would change, you know, the way our relationships with our vehicles. I mean, this is the optimism case for Tesla. It's it's it would be a legitimately huge deal, which is why everyone has been buying, equity in Tesla for as for the last, you know, 10 years because it it would change the economy. Mhmm.
Jack Sanker:But if it's all kind of fluff and, you know, BS, that's a big problem.
Danessa Watkins:What I think you can't I I know we are not gonna be experts on this subject as far as safety concerns, but, you know, you can't minimize the the obvious safety issues when you have the CEO making statements like side mirrors won't be needed. You know, that's making some pretty big promises.
Jack Sanker:Yeah. And and the thing about full self driving in in which, like, the opponents or kind of Tesla, negativists would would point out is, like, when you say that to a driver and they take you at face value, the understanding is I can I can take a nap now? You know? I don't have to have I don't even have to have my eyes open. And Right.
Jack Sanker:So now the margin of error is if this thing fails, it's a catastrophic failure because the driver is completely disengaged, which is why the law so far has required, drivers to, you know, keep their hands on the steering wheel and to, like, you know, ostensibly pay attention. Now you can go on YouTube and find videos of people doing all kinds of crazy stuff in their Teslas, while self self driving is engaged. And, like, none of that is, like, good or or safe or probably legal. But, yeah, that's that's that's the big issue is is if this is if people are trusting in this software, to operate and it doesn't, well, you know, the downsides are pretty significant. I'm sure if you asked Tesla, that, you know, whether they had this capability, they'd say yes.
Jack Sanker:But when push comes to shove, if that were the case, they would say, you know what? We'll we'll we'll go ahead and assume liability for these crashes or for these, you know, malfunctions or whatever, and they haven't. You know? So I think that that is, a pretty significant, indicator of how much faith they have in their own product, for example. And, based on yeah.
Jack Sanker:You know, I I it doesn't to me and people who have listened to the show, I'm a bit of a tech pessimist. You know, I I I think over the past couple of years, we've learned a lot about, when Silicon Valley makes claims like this, like, what to actually expect. So I I don't know. I I think maybe the folks in Washington are getting wise to that as well. And it matters because of the amount of subsidies that companies like Tesla get from the taxpayers, the state, and federal levels.
Jack Sanker:It matters from, you know, the investor perspective. But the DOJ is is at this point pretty, focused on the market manipulation aspect of it. I also think the the SEC, I believe, is also involved. Like I said, I don't wanna see Tesla stock tank because that'll, you know, that'll hurt my retirement account, you know, and and then probably most people that are listening in one way, shape, or form. It had hurt the US economy pretty pretty badly.
Jack Sanker:But, at some point or another, they're gonna have to make good on this promise or else they're just an electric car company. And that's nothing wrong with that. That's fine. But it's not it doesn't justify, you know, a $1,000,000,000,000 market cap when a company like Toyota sells, I don't know, 50 times as many vehicles, and is valued much much smaller, by the by the market.
Danessa Watkins:Yeah. Yep. Wow. Yeah. That's interesting.
Danessa Watkins:And you said that they've been investigating them since 2022 on this?
Jack Sanker:Yes. So the DOJ's perspective is that they would they would be claiming that, investors and consumers were defrauded or were induced, to be defrauded by these statements. The SEC will talk more about specific, you know, elements of, like, market manipulation and securities, etcetera. But the long and short of it is they've got a lot to prove, and I think that it needs to be done quickly, from the Tesla shareholder perspective and and government regulatory perspective as well.
Danessa Watkins:Alright. Another Department of Justice case. There was a recent settlement that was reached, a 138 $700,000 to be exact. And this was over the Larry Nassar scandal, and allegations that the FBI failed to protect the the victims of Nassar over a number of years. So this settlement is pretty far reaching.
Danessa Watkins:It covers a 139 claims from different women, essentially claiming that they were victims, now survivors, of sexual assault from Larry Nassar and that the FBI not only had notice of this but ignored it. You know, completely dropped the ball, failed to talk to local authorities, failed to conduct any sort of investigation, which could have saved as many as potentially 70 of his victims. So Nassar has been accused just a little bit of background in case you've been living under a rock. Larry Nassar has been accused of abusing hundreds of women and girl athletes as young as 8 years old while working at Michigan State University with USA Gymnastics and also local schools and teams. So in 2017, Nassar pled guilty in federal court to charges of possessing child pornography and also destroying and concealing evidence when he believed, correctly so, that there was an investigation by law enforcement that would reveal his child pornography activities.
Danessa Watkins:So for that, he was sentenced to 60 years in federal prison. And then in Michigan State Court, he pled guilty to 10 counts of criminal sexual assault. And before his sentencing, a 156 victims spoke over 7 days, really recounting similar stories over and over about going to this doctor for for treatment related to sports injuries only to be sexually assaulted under the guise that it was a form of treatment. So as a result of that, Nassar was sentenced to 40 to a 175 years in prison. And just because I'm this story hits home for me, and I'm a I'm a firm believer in the protection of of sexual assault victims.
Danessa Watkins:I just love this judge's comments during the sentencing. She said, quote, as much as it was my honor and privilege to hear the sister survivors, it was my honor and privilege to sentence you because, sir, you do not deserve to walk outside of a prison ever again. You have not owned yet what you did. I wouldn't send my dogs to you, sir. I've just signed your death warrant, end quote.
Jack Sanker:This is this is the judge who I think ripped up the, was it the sending sending these guidelines? Because I think it was it might be confusing with someone else, but it was a televised sentencing, and the judge, like, stood up and, like, ripped up a piece of paper and made a big show of it, I think.
Danessa Watkins:I yeah. I remember that. I'm not sure if this was her. This is the the quote I just gave you is from, Judge Rosemarie Aquilina, but, but it would make sense. Okay.
Danessa Watkins:So now how does the how does the FBI come into play here? Well, in 2021, the inspector general for the justice department, he issued a report revealing that agents at multiple FBI field offices were tipped off to Nassar's crimes, but failed to adequately investigate or notify local authorities. One of the most prominent examples is that the FBI's field office in Indian Indianapolis. They received complaints about Nassar as early as 2015, and the report concluded that senior FBI officials in that office failed to respond to allegations with the utmost seriousness and urgency that they deserved and require. The office also made numerous and fundamental errors when they did respond, including, like I mentioned, failing to notify local authorities.
Danessa Watkins:So the result of this mishandling or, guess, better described as a complete absence of any semblance of competency, those are my words, is that Nassar continued to abuse 70 or more athletes from the time that the FBI was first notified until August of 2016 when the Michigan State University Police Department received a separate complaint. So despite all of this, the DOJ said that it would not be bringing charges against those agents who miss mishandled the investigation, and, actually, some of them subsequently lied to cover up their mistakes. So in 2022, 90 survivors of Nassar's abuse brought a suit against the FBI, and their suit included a prayer of damages for $1,000,000,000 Now these claims were filed under the Federal Tort Claims Act, which gave the government 6 months to respond to the injured parties before they could file suit. So I believe during that time, they started to negotiate potential settlement, because the outline of the agreement was actually reached last year. And then over the past few months, lawyers on both sides have just been determining the specific payouts.
Danessa Watkins:So the awards that each claimant will get will vary based on the abuse, but the reports indicate that the settlement will result in approximately $1,000,000 paid to each survivor. So as much as this settlement serves as a successful resolution potentially for the survivors, Mick Gruel, who is one of the attorneys for 44 of the claimants, including actually one who died of suicide, has said that this offering by the government is just really too little too late. New York Times quoted attorney Gruel as follows. These women were assaulted because of the FBI's failure, and there's no amount of money that will make them whole again. Their goal with all of this was to make sure that this never happens again.
Danessa Watkins:He hopes this deal will close the book on this and will help lead them to a path of healing, unquote. Now I read the story of one of those survivors, Alexis Hazen, who first reported abuse by Nassar in 2016. She claims that she endured his abuse from ages 12 to 18, and she is now 26, married, and a mother of 3 boys. So she gave a phone interview to The New York Times, and she said, quote, I'm relieved but disappointed that no one is being held accountable for failing to report the abuse and for sweeping it under the under the rug. In a way, this helps me be able to move past this, but it's always in the back of my mind that, wow, If the FBI didn't protect me, could something like this happen to my children?
Danessa Watkins:And that makes me really, really mad. I definitely have no trust in that institution anymore. So, in case you're wondering, mister Nassar is currently serving out his sentence in federal prison in Florida. And in July of 2023, he was stabbed multiple times in the chest, back, and neck by another inmate, suffered a collapsed lung, was lucky to survive, but he did, in fact, survive. So, I mean, just, you know, looking at settlements like this, it it's really impossible.
Danessa Watkins:I mean, how much is enough? No amount will ever be enough. You know, for many of these survivors, this this is really bigger than them. You know, they they're seeking change for the future so that this never happens to another athlete. And how do you ensure that?
Danessa Watkins:You know, on on the one hand, yes, we should give some credit to the DOJ for admitting that the agency was at fault and and had shortcomings. You know, it's not often that we see organizations like this come out and say, yeah. We got this wrong. But, you know, some have suggested here, why are there not consequences on an individual level? Like, why are we not holding those specific FBI agents that didn't take these athletes' complaints seriously?
Danessa Watkins:Why aren't they personally liable? I did look a little deeper into that just to see if there was anything. And, the 2, the 2 agents that were mentioned most prominently in the inspector general reports. One of them was the head of the Indianapolis field office. He retired shortly after the came out.
Danessa Watkins:And then another one, he was fired and then ended up suing the FBI in federal court to overturn his his firing. He lost that, by the way. But I so there really were no repercussions on a, you know, local level. So I I don't know if, you know, I don't know what the answer is here. I mean, yes, it's it's great that the government is taking accountability, but is this really gonna change things in the future for, you know, future potential victims?
Jack Sanker:You know, I don't wanna say that it it's a small settlement. I mean, it's not. It's a 138,000,000, which is a weird number because there's a 139 claimants claimants. So I I wonder Mhmm. That, you know, it's not a one for $1,000,000 per.
Jack Sanker:And they suit for a 1,000,000,000. And some of the individuals in that class, I think, are pretty high profile people. Some, you know, collegiate athletes, I think some Olympians, for example. One thing that Yeah.
Danessa Watkins:Some that will be actually competing Olympics coming up. So Yeah. And
Jack Sanker:Yes. Yeah. I know
Danessa Watkins:it's Ali. Yeah. Mhmm. Yeah.
Jack Sanker:What's what's interesting to me, and this is, you know, not as a right and wrong thing, but as, you know, as an attorney, I it it it seems like it's a settlement that is maybe being reached in in interest of, you know, maybe doing the right thing. Too little, too late, of course. But because I mean, correct me if I'm wrong, but, I mean, claims under the the FDA, FTCA rather, I mean, there's a still approximate cause element here. And, you know, I I don't know. Failure to investigate, typically, at least in the local context, police officers, things like that is usually not actionable, or at least not successfully actionable.
Jack Sanker:You know, law enforcement has broad discretion to decline taking on investigations, that for one reason or another, they don't want to. And and that could be for a number of reasons. It could be, you know, in this case, it seems like, whatever bias or lack of of taking it seriously with respect to these claimants. I mean, who knows? I have no idea.
Jack Sanker:But there is approximate cause element that I think maybe would have given the claimants a problem down the road, because they they still have to show, the elements of the FTCA are are broadly similar to what you would see in, you know, standard tort action. You know, injury, the employee has to have been acting within the scope of their authority as a government agent. The the employee would have had to have been, you know, negligent or or wrongful or intentionally or otherwise. And then there has to be the proximate cause. I mean, the proximate cause proximate cause, not cause in fact, but proximate cause of the injuries here is is Nassar.
Jack Sanker:Right? Mhmm. So this does seem like a negotiated piece between the parties, which is good, of course, for the for the claimants. But I think it does reflect probably a a real risk of ruling down the road, which would bar the whole thing. At least that's my 2¢ as a tort litigator, in in just spotting the issues here.
Danessa Watkins:Yeah. I mean, it's an interesting point, and I, you know, try to put my emotions aside on the issue, because I I certainly think that when it comes to sexual assault claims, you know, they they are in a different category than just, you know, a a failure to investigate a a robbery or something like that. I mean, the fact that we have these figures, and I found them in multiple reports that between the time that the FBI was first notified of this until the time where the the Michigan police took it seriously. I mean, they have a firm number. There were 70, if not more, victims that, that were abused during that period of time.
Danessa Watkins:So, I mean, you know, what what evidence they have of that, I I can't tell you firsthand. But let's also keep in mind, like you said, the, you know, the climate of what's going on now. Obviously, we've had the Me Too movement. The US Center For Safesport was developed in I think March of 2017 is when it officially opened its doors. And that was in large part because of the Nassar scandal becoming public.
Danessa Watkins:There were a lot of congressional hearings about this, certainly a ton of attention. So, yes, maybe to some extent, this is a result of of the media that was that was put on this issue. I mean and rightly so. It brought about some some real change and some good change in protecting our young athletes. It's just unfortunate, obviously, that so many people had to to be injured in order for us to get this change.
Danessa Watkins:But it but you brought up, you know, that interesting point of just how do you prove proximate cause in these type of cases. And I I did dig a little bit further into this because I think it is kinda monumental that the Department of Justice will enter into a settlement this big, but this isn't the first one. And there have been more recently settlements, involved with the victims of mass shootings. So in, yeah, in in 2023, the victims and families of the 26 people that were killed in the 2017 shooting at a church in Texas, They received 144,500,000 in a settlement with the DOJ. Now this was after a federal district judge in Texas ruled that the the Air Force was 60% liable for the attack that occurred.
Danessa Watkins:Officials had failed to submit crucial records that would have prevented the suspect in the Sutherland Spring shooting from obtaining, from a licensed gun dealer, the semiautomatic rifle that he used in the attack. This is the findings of the judge. The judge also found that air force officials were aware that the gunman had previously researched and threatened a mass shooting and had a history of severe mental health issues that had led officials to declare him to be, quote, dangerous and, quote, a threat. He also had a domestic violence conviction by a military court. So based on all that evidence and and the air force's failure to to pass that along, the judge awarded originally 230,000,000 to the families.
Danessa Watkins:And, shockingly, the justice department appealed. They argued, quote, there is no dispute that the US Air Force personnel failed to transmit to the National Instant Criminal Background Check System information about the gunman that would have identified him as ineligible to purchase that firearm. But that mistake is not a legally proper basis for imposing liability on the United States or for finding the Air Force more culpable for the deadly massacre than the shooter end quote. So that's exactly what you were just talking about, Jack, of, you know, how how do we have this judge saying that the government is 60% liable for the attack when, you know, it's it's not the one that actually carried out the the shooting. Yeah.
Danessa Watkins:So so those were the arguments that went up on appeal. And and while it was pending in the 5th district, the the government did settle for that $144,500,000 figure. So certainly less than than what the judge found at the district court level, but still a very sizable settlement, especially after having heard, you know, what I just read to you, their position that they they couldn't be held proximate as the proximate cause.
Jack Sanker:Yeah. And and I know that the victims in this case, also had, they've they have prosecuted their claims against, they prosecuted their claims against Michigan State, you know, against Nassar individually. There's a lot of civil civil remedies.
Danessa Watkins:USA Gymnastics also. They brought claims against. So
Jack Sanker:Yeah. I mean and to some extent, not to not at all to make an excuse here. But if you're at the FBI field office and you get a phone call about, an an individual, you know, on a college campus, a college employee who's who's doing something wrong or the other. 1 or 2 of of those phone calls, you you may think to yourself I'm trying to just rationalize this. Well, that's a university issue or that's a state police issue.
Jack Sanker:You know, bring it to the university. Bring it to the cops. Like, we're the FBI here. You know? It's, we've got terrorists to chase and and all sorts of other things to to worry about.
Jack Sanker:But they're you crush a a threshold pretty quick when you've ignored the volume of complaints that they seemingly did. And we haven't talked about the real issue, which is the cover up aspect of this, which I think I think you know, I'm sure that the settlement release, in this includes release of claims for that element, to the extent that there is one. But, like, that is that in of itself is, I think, signifies that these folks knew they they crossed the point where they knew they had screwed up and then were trying to, keep themselves clean here. And that's obviously some evidence of, you know, of intent or or at least evidence of, you know, knowingly wrongdoing at a certain point or another. So, yeah, it's it's it's tough.
Jack Sanker:I I think that the the settlement amount here is reflective of of the both sides recognizing some risk here and not to be, you know, cynical, but, Simone Biles, you know, isn't a national icon. She's a treasure. The a sexual assault claim filed by someone of her star caliber, individually, for example, would would would demand a larger settlement than $1,000,000. Right?
Danessa Watkins:Right.
Jack Sanker:So, you know, for it to be split this way among the parties and everyone, you know, thankfully, it seems like everyone in the in the that brought the claims are being compensated along with everything else, and and that doesn't, you know, make them whole at all. But it it does reflect some recognition on behalf of probably the plaintiff's lawyers that getting a judgment might might might be less than a sure thing, which is which is good. I mean, that's that's also point of of this type of settlement arrangement.
Danessa Watkins:Yeah. That. And I think, I mean, like I said before, I think a lot of these athletes are are not doing this, you know, to line their pockets. I don't I don't think it's about money. You know?
Danessa Watkins:And it it's more about the recognition that there was a extreme, you know, failure in the system and breakdown that should never happen again. Of course, this is gonna take a hit on the on the government from a monetary standpoint, but also from a reputational standpoint. I mean, when you, like you say, have one of our nation's treasures saying she can't rely on the FBI, I mean, you know, that that's serious, and and it's something that I'm glad that the government took seriously.
Jack Sanker:Yeah. And the last thing is this, undoubtedly, at least hopefully, is gonna come with, you know, remedial training and protocols and internal procedures at the FBI, for if and when this, you know, hopefully never happens again, but something like it does to prevent this catastrophe from, you know, from unfolding the way it did. And I think that's the real benefit to the public here.
Danessa Watkins:Absolutely. And even on just the most basic level, understanding that certain crimes are should be treated differently. You know, for someone to come forward about sexual assault is a very different thing than someone coming forward about, you know, their TV was stolen or whatever the case may be. And so, yeah, training officers too. You can't just tell someone to call the local police.
Danessa Watkins:You need to actually take the step of referring it to the local police yourself.
Jack Sanker:Yes.
Danessa Watkins:You know, you can't expect victims to come forward multiple times to multiple different agencies. Right. So so good for, I don't know, good for the government for taking a serious look at this and admitting fault. And, yeah, hopefully, they improve improve their training and do better. Yeah.
Danessa Watkins:Do better next time, please.
Jack Sanker:Thanks everyone for listening. As a reminder, this show comes out every other Tuesday, roughly twice a month. You can find us on Apple Podcasts, YouTube, Spotify, wherever you get your shows. If you have any questions or you wanna follow-up on any of the stories that we've covered or figure out kinda who Danessa and I are, you can drop a comment, and we'll do our best to get back to you. Otherwise, you'll hear from us in 2 weeks.
