COVID-19 Puts Ex-Traders' Trial Rights 'In Conflict,' Feds Say

By Jody Godoy
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Law360 (July 31, 2020, 5:46 PM EDT) -- Two ex-Deutsche Bank traders charged with spoofing may have to choose which constitutional trial rights to assert amid the COVID-19 pandemic, a U.S. Department of Justice prosecutor told a federal court on Thursday: the right to a speedy jury trial or the right to confront witnesses in person.

Former traders James Vorley and Cedric Chanu are headed for a September trial in Chicago on charges of spoofing the commodities markets by making and then canceling deceptive trades. Prosecutors from the Department of Justice's Fraud Section have proposed that some witnesses from out of state and overseas appear by video, a move the traders have partially opposed.

At a hearing on Thursday, Fraud Section trial attorney Avi Perry said that because of the "unprecedented" nature of the pandemic, the traders must "prioritize" whether they wanted a speedy trial, a trial by jury or the ability to have witnesses in the case physically present.

"At a certain point, the defendants' assertion of all their constitutional rights potentially puts some of those rights in conflict with one another," he said according to a transcript of the hearing obtained by Law360.

Prosecutors have asked to use two-way video over concerns about travel restrictions, quarantine and the potential for those witnesses to contract or spread COVID-19 by participating in the trial.

Perry also argued at the hearing that jurors might balk at the prospect of a trial where they could be exposed to witnesses that have traveled from other countries and states that have been or are currently coronavirus hot spots.

As an alternative, trial attorney Brian Young floated the prospect of a bench trial, which would require the defendants' consent, as a means of overcoming health fears by eliminating the jury entirely and letting the case be decided by U.S. District Judge John J. Tharp Jr.

The comments came as Judge Tharp mulls prosecutors' request to allow three witnesses to testify by video from Texas and Australia. 

In order to facilitate the remote testimony, prosecutors suggested "the monitor broadcasting the witness's testimony should be placed as close to the witness stand as is feasible." They also proposed each side could send representatives to Australia and Texas to hand the witnesses documents, or have a government representative do it.

The Texas-based witnesses are Professor Kumar Venkataraman, an expert who is expected to testify that "the trading sequences that he reviewed are inconsistent with an intent to execute," and Travis Varner, employee for alleged victim Quantlab Financial. From Australia, they hope to call Alan Jukes, who works for a market analysis company.

Prosecutors argued that video appearances are allowed under the Supreme Court's ruling in Maryland v. Craig. In that case, the court said a defendant's right to confront a witness in person can only be denied when it "is necessary to further an important public policy" and "the reliability of the testimony is otherwise assured."

The government also argued there is no need for jurors to assess witnesses' credibility in person because they are not cooperators whose freedom hinges on helping the government win its case.

Vorley and Chanu argued in a reply filed Thursday that the witnesses' testimony is largely unnecessary, and that where there is a will to bring witnesses in, there is a way, given that one cooperator is coming in from Singapore to testify.

They argued that basing the right to confront witnesses on speculative health concerns presents a "slippery slope."

"Such an outcome would effectively erase the constitutional guarantee of face-to-face confrontation as long as the pandemic continues," they wrote.

Counsel for the defendants declined to comment on Friday. A spokeswoman for the DOJ did not immediately reply to a request for comment.

Vorley is represented by Matthew L. Mazur, Roger A. Burlingame and Christopher Burrichter of Dechert LLP.

Chanu is represented by Michael G. McGovern, Helen Gugel, Megan A. McEntee, Aaron M. Katz and Laura G. Hoey of Ropes & Gray LLP.

The case is U.S. v. Vorley et al., case number 1:18-cr-00035, in the U.S. District Court for the Northern District of Illinois.

--Editing by Amy Rowe.

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