1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK - - - - - - - - - - - - - X UNITED STATES OF AMERICA, : : : : : : : : : : : : : -against- FELIX SATER, Defendant. 98-CR-1101(ILG) United States Courthouse Brooklyn, New York Wednesday, April 17, 2019 10:30 a.m. - - - - - - - - - - - - - X TRANSCRIPT OF CRIMINAL CAUSE FOR MOTION BEFORE THE HONORABLE I. LEO GLASSER UNITED STATES SENIOR DISTRICT JUDGE A P P E A R A N C E S: For the Government: RICHARD DONOGHUE, ESQ. United States Attorney Eastern District of New York 271 Cadman Plaza East Brooklyn, New York 11201 BY: TEMIDAYO AGANGA-WILLIAMS, ESQ. Assistant United States Attorney For Felix Sater MOSES & SINGER 405 Lexington Avenue, 12th Floor New York, New York 10174 BY: ROBERT S. WOLF, ESQ. ROBERT BARNES MCFARLANE, ESQ. For First Look Media: EMERY, CELLI, BRINCKERHOFF & ABADY 600 Fifth Avenue, 10th Floor New York, New York 10020 BY:ANDREW CELLI, ESQ. BRIAN BRALOW, ESQ. Court Reporter: VICTORIA A. TORRES BUTLER, CRR 225 Cadman Plaza East / Brooklyn, NY 11201 VButlerRPR@aol.com Proceedings recorded by mechanical stenography; transcript produced by Computer-Aided Transcription. Proceedings 2 1 (In open court.) 2 (Judge I. LEO GLASSER enters the courtroom.) 3 THE COURTROOM DEPUTY: 4 Criminal Cause for Motion, United States versus 5 Felix Sater. 6 7 Counsel, please come forward and state your appearances. 8 9 All rise. MR. AGANGA-WILLIAMS: For the Government, Your Honor, Temidayo Aganga-Williams. 10 THE COURT: Good morning. 11 MR. WOLF: 12 Robert Wolf, representing Felix Sater. Good morning, Your Honor. Also to my 13 left, Your Honor, Robert McFarlane, an associate from my 14 office. 15 MR. McFARLANE: 16 THE COURT: Good morning. 17 MR. CELLI: Your Honor, I'm Andrew Celli. 18 for First Look Media. 19 who will be arguing today. 20 21 MR. BRALOW: THE COURT: Your Honor, my name is David Bralow. Thank you. You are the person whose submission was entered. 24 MR. BRALOW: 25 THE COURT: I am here With me is my colleague, David Bralow, I'm an attorney at First Look Media. 22 23 Good morning. Yes. All right. VB OCR CRR Proceedings 1 Good morning. 2 ALL: 3 THE COURT: 4 3 Good morning. I think it is appropriate for me to hear the movant first. 5 MR. BRALOW: All right, Your Honor. 6 Your Honor, I know and I well appreciate that 7 motions for leave to intervene and motions to unseal are 8 somewhat common before you, and it would be not judicious or 9 in the interest of time to actually discuss the state of the 10 First Amendment law of access. 11 familiar with it. I suspect that you are quite 12 I also recognize that the Court has grappled with 13 this question with respect to the interplay between the PSR 14 and the sentencing memoranda, as well as the 5K letter, 15 throughout the term of this particular matter as it relates to 16 this Information. 17 I'll be very clear that we have never wanted and we 18 do not ask for the PSR. 19 circumstance, is at least the sentencing memoranda and the 5K 20 letter, and some of the documents that have been sealed. 21 the reason why we come forward this time, and perhaps the next 22 time, or sometime in the future, is that we believe that 23 The First Amendment right of access does attach to these 24 particular papers, and that each time that the Court has an 25 obligation, respectfully, to examine whether the compelling VB What we do ask, though, in this OCR CRR And Proceedings 4 1 interests that have called for the sealing remain. 2 the changed circumstances that make us go forward at this 3 moment, and I think they are somewhat obvious. 4 Now one of The first is that Mr. Sater seems to be the one 5 controlling the narrative of what it is that he has done and 6 what he has not done with respect to his cooperation. 7 in dribs and drabs, discusses his heroic -- his heroism, and 8 yet we really don't have a full picture or understanding about 9 what was the cooperation, and what was the effort that allowed So he, 10 Mr. Sater to have the type of sentencing that he actually 11 ultimately received. 12 We also know that this Court and other courts have, 13 by dribs and drabs, released certain information. 14 we learned that Mr. Sater had received -- you know, 15 Mr. Sater -- we've looked at the -- the Court unsealed three 16 documents. 17 talked about Mr. Sater wearing a wire, going, traveling for 18 the benefit of the FBI, and what we would be interested in 19 knowing is exactly what is the Government's interest at this 20 point in keeping his cooperation -- continuing to seal off his 21 cooperation. 22 Last week Last week the Court unsealed three documents that Because, in fact, we still maintain, and always have 23 maintained, that it's going to be the Government's burden to 24 demonstrate a compelling -- or Mr. Sater's burden to 25 demonstrate a compelling interest, and to demonstrate that the VB OCR CRR Proceedings 5 1 sealing is no broader than necessary and that it would be 2 effective. 3 We also know today that Mr. Sater and his 4 involvement with the Trump organization, his likely mention or 5 reference in the Mueller report is -- creates a significant 6 public interest in what it is that this individual has done 7 and not done historically. 8 we need to be able to protect the historical record with 9 respect to Mr. Sater, because at some point we will be, you 10 know, he -- there will be people that will be interested in 11 exactly this particular conduct that Mr. Sater did and, 12 frankly, the conduct of the Government in relationship to 13 Mr. Sater. 14 And it really is this concept that I mean, it should not be ignored or it comes as an 15 interesting coincidence that several of the U.S. Attorneys 16 that were working with Mr. Sater during the 1990s and into the 17 2000s, are some of the same attorneys that are working or had 18 worked with Mr. Mueller in the special investigation with 19 respect to the President. 20 We know that Mr. Sater has testified before Congress 21 and is likely to testify before Congress, and we also know 22 that Mr. Sater seems to be quite willing to disclose what he 23 wants to disclose at one time or another. 24 25 So I maintain, and first look maintains, that it is clear that The First Amendment right of access attaches to VB OCR CRR Proceedings 1 6 sentencing reports. 2 THE COURT: 3 MR. BRALOW: It is not an absolute right. But it is not an absolute right and it 4 is clear that the Court has the obligation to determine 5 whether there is a compelling interest, and the Court has met 6 this obligation repeatedly. 7 disclose this particular information, or at least to put the 8 Government through taking a look at the various sentencing 9 memoranda and the sentencing report again to see what, in 10 11 But maybe it is now time to fact, is particularly compelling. The Government, I suspect, will bring out the 12 Charmer's factors one more time, and that's fine. 13 Mr. Sater will. 14 interests in Charmer that are perhaps not particularly likely 15 or important -- or are not -- are not really subject to being 16 protected at this point. 17 instance, is one of the first Charmer's factors. 18 Or But we have to look at what were those For the safety of the defendant, for Well, Mr. Sater is well willing to discuss his 19 activity and usually when you are talking about Charmer in 20 this circumstance, the cooperation seems to be ongoing. 21 The privacy of third-parties. We can't really 22 discuss or disclose -- take any type of crack at trying to 23 decide what the privacy of third-parties are, but at least the 24 public should have a succinct statement as to what that 25 privacy interest is, rather than just a generalized statement VB OCR CRR Proceedings 1 7 of the Charmer's factors. 2 Protecting the ability of the Government to provide 3 other cooperators would be one of the factors that is most 4 often discussed in Charmer. 5 practical matter, when this cooperator -- well, it just seems, 6 I will put it this way, Mr. Sater is sui generis. 7 be a person that is acting on his own behalf and creating his 8 own story. 9 the disclosure of Mr. Sater's information that would be found I am having trouble, as a He seems to It doesn't seem that, in effect, that Mr. Sater -- 10 not in the PSR, but in the 5K letter, and the sentencing 11 memoranda, would be implicated by or would implicate somehow a 12 chilling effect on these particular cooperators at this time. 13 Finally, there is that issue with respect to 14 protecting information that would be held in confidence, that 15 was provided in confidence. 16 of paper, I can't really address that, but what I would ask 17 the Court to do, and I ask the Government to do, is to take a 18 look at what was provided in that particular sentencing 19 memoranda and the 5K letter, and determine whether or not the 20 public's right of access at this point to understand what and 21 how the justice was provided to Mr. Sater was meted out. 22 Again, looking at a blank piece I think that you have heard the arguments before, 23 but I think at this time and at this moment, it is time for a 24 new look with respect to these documents, and it's really time 25 to hear the Government assert what interests still remain and VB OCR CRR Proceedings 1 8 why these particular documents should be sealed. 2 Thank you, Your Honor. 3 THE COURT: Let me just tell you that I do not 4 intend to proceed with this hearing regarding whether the 5 information in the documents that have been requested to be 6 unsealed does or does not yield some overriding compelling 7 interest. 8 the proponents for maintaining the sealing of these documents 9 an opportunity to carry the burden of proof, which is theirs, 10 I am bound by In Re: Herald and by Haller to give that continued sealing is necessary. 11 To do that, a review of those documents would be 12 necessary and to review them in open court would, obviously, 13 defeat the entire purpose of whether documents should or 14 should not be sealed. 15 here in open court. 16 So I will not go into that question I will do that in camera. There will be a record of those proceedings. I do 17 not know how long they will take. I doubt that they will take 18 very long. 19 which are deemed to be unsatisfactory, or make proponents of 20 unsealing unhappy, I think Herald and Haller indicate that an 21 appellate process is appropriate. 22 affirmed by the Second Circuit. And to the extent that the findings are made, That procedure has been 23 Mr. Bralow, I have been through this more than once. 24 And what is interesting about it, there are a number of things 25 that are interesting about it. VB I am sorely tempted to conduct OCR CRR Proceedings 9 1 what might loosely be described as a seminar in sealing and 2 the underlying objectives of this entire process, particularly 3 statements which are made in the leading cases which are cited 4 all the time, Lugosch and Amodeo and Alcantara about how 5 historically all of this was done. 6 Going back into history, if that would mean going 7 back to 17th and 18th century judicial proceedings in England, 8 there was not access to trials at all, let alone documents. 9 Even in this country, the question as to whether the access, 10 the right of access pertained to documents, historically it 11 pertained to the trial. 12 decide whether access to suppression hearings permitted by 13 The First Amendment. 14 whether sentencing proceedings require access pursuant to 15 The First Amendment. 16 And so you had a Supreme Court case Had the Supreme Court then had to decide I think in Gannett versus DePasquale, Judge 17 Rehnquist said he does not under why The First Amendment is 18 even applicable here, why it has any application to this whole 19 purpose. 20 We can go into that for a long time. We can 21 question exactly what is it besides knowing that Sater 22 cooperated -- and by the way, Sater is not driving the 23 narrative for this Court. 24 determination based upon what the law would require it to 25 make, and it is interesting to observe what it is that this is VB This Court is making its OCR CRR Proceedings 1 2 10 really all about. In 1998 I took a plea of guilty to Sater to a 3 racketeering count which was the same, precise same count, for 4 which 19 other defendants were indicted. 5 whole pump and dump operation which organized crime was 6 intimately involved. 7 I sentenced every one of those 19 defendants eventually over a 8 period of time. 9 It was part of that I believe I am right in remembering that And 10 or 11 years went by after that plea was taken 10 and the letters that you say I unsettled, or three that were 11 requested by a Ms. Collins, who is now someplace in Romania, I 12 think, were letters which asked for an adjournment over 10 or 13 11 years, if you looked at the docket sheet. 14 letters requesting an adjournment. 15 Felix Sater, was a cooperator. 16 There are The defendant namely, And then the time came in 2010, I think, or 2009, 17 when Sater was sentenced. 18 Nothing else was of any great significance. 19 defendant pled guilty to a crime, was sentenced. 20 That was the end of the matter. Just another And then an action is commenced in the Southern 21 District of New York, and everything that has happened since 22 had nothing to do with the crime for which he was sentenced, 23 the RICO offense. 24 guess, is when the attorneys who then represented Sater came 25 dashing into my court requesting a preliminary injunction, Everything that has happened since 2010, I VB OCR CRR Proceedings 11 1 civil action was filed in the Southern District of New York 2 and attached to the complaint was a Pre-Sentence Report and 3 proffer agreements and a cooperation agreement. 4 You know all about that, don't you, Mr. Bralow? 5 MR. BRALOW: 6 THE COURT: Yes, sir. So nothing to do with the crime for 7 which Mr. Sater was sentenced and to which he pleaded guilty. 8 Had only to do with Mr. Sater's involvement in real estate 9 transactions. 10 11 Had nothing to do with that crime to which he pleaded guilty back in 1998. And now there is renewed interest. And it is 12 interesting. 13 of your application, what is interesting is on page 3, 14 Mr. Sater is scheduled to appear before the U.S. House 15 Intelligence and Judiciary Committee. 16 the intense light of scrutiny shines on Mr. Sater's 17 relationship with Russian oligarchs and organized crime. 18 Looking at your brief, or memorandum in support You know all that. The Court knows that You knew what his relationship 19 was to Russian oligarchs. I think all of that has been 20 revealed many times in the past. 21 cooperation during that 10 or 11 years. 22 But then you go on: That was part of his His association with President 23 Donald Trump, his involvement in meetings concerning building 24 a Trump tower. 25 interest in Felix Sater, because he is involved with Trump. That is what has really fueled all this sudden VB OCR CRR Proceedings 12 1 And so in order to have some understanding of what his 2 involvement with Trump was, the need is to unsettle documents 3 which were part of a sentence back in 2009. 4 I do not want to go on and read some more 5 references, in your very good, very able memorandum continuing 6 to talk about how important all this is for the understanding 7 of his relationship with Trump. 8 there is not a mention of Trump, as I remember it, not in 1998 9 when he pleaded guilty. His relationship with Trump, I don't think he even knew who Trump 10 was then, nor was there any mention of Trump in a Pre-Sentence 11 Report that I can remember, or in any other documents relating 12 to sentence involving or relating to Trump that I can 13 remember. 14 But there is this renewed interest in the documents 15 which had to do with his sentence, whether his cooperation 16 warranted the sentence which the Court imposed. 17 exercise, discharge its judicial responsibility to the 18 defendant and to the community? 19 given all the circumstances of his cooperation and the rest of 20 it. 21 this. I do not know whether you saw the two recent documents that were recorded. 24 25 Was the sentence appropriate That is one question which has been fueling a lot of 22 23 Did the Court MR. BRALOW: I did, Your Honor. them. VB OCR CRR I do not endorse Proceedings 1 THE COURT: 13 The question with respect to why wasn't 2 restitution ordered in connection with Sater; it was not 3 ordered in connection with the 19 defendants who were part of 4 that crime, simply because the statute provided that 5 restitution is not appropriate where the amount is impossible 6 to ascertain harm to any particular defendant or victim is 7 hard to entertain. 8 unnecessarily and needlessly complicate and prolong the 9 judicial process. 10 An effort to do all that would And the Government made that application. Said to 11 me, restitution is not appropriate because of all those 12 factors and the statute says it. 13 So what is it that you want to know that you do not 14 already know that may have some implication for the Trump 15 connection which Sater? 16 The point of the matter is, without laboring it any 17 further, with respect to whether there is anything in these 18 documents, which I am not aware of now, that the Government 19 can point out would justify some compelling interest, some 20 overriding social value, I will conduct a hearing with the 21 Government and with the defendant for the purpose of making 22 that determination. 23 correct, that there is not any justification for continuing 24 these documents to be sealed, I will unseal them. 25 extent that I can be satisfied that there is an overriding And to the extent that your position is VB OCR CRR But to the Proceedings 14 1 social interest and compelling interest, I will keep it 2 settled. 3 I will keep it sealed. I do not know that now. It is correct that Sater 4 has maybe a factor for me to consider. 5 has appeared on public television. 6 was it you told me? He has testified or he He has appeared with who Chris Hayes and with -- 7 MR. BRALOW: Quite a few. 8 THE COURT: 9 An interesting question, I suppose, might be argued -- other people, yes. 10 as to whether he has waived all of these other considerations. 11 I do not know at this stage whether he has or he has not. 12 But I can assure you, Mr. Bralow, that if the law 13 requires me to unseal these documents -- you know there seems 14 to be some underlying sense that courts want to keep things 15 secret, that we want to hide things from the public, that the 16 public has a significant interest in knowing what did he do 17 over the 10 or 11 years. 18 He cooperated. And you know what he did over the 19 10, 11 years, because you told me that you know. He provided 20 the telephone number of Osama bin Laden. 21 lot of very interesting and dangerous things. 22 the public have to know that would affect these House of 23 Representatives hearings and Mr. Trump? He has done an awful What else does 24 I do not know. 25 In your memorandum, what I am really saying, VB There may be other things. OCR CRR Proceedings 1 2 15 Mr. Bralow, I am looking at page 2 of your memorandum: Mr. Sater is protecting safety. Mr. Sater and his 3 family preventing publication that may serve as a disincentive 4 for other confidential informants, preserving the 5 confidentiality of the Pre-Sentence Report have diminished. 6 Have diminished. They have not disappeared. I do 7 not know whether there is still some kernel left that I do not 8 know about that the Government can convince me, requires 9 continued sealing. 10 I am sorely tempted to go into it. Some day maybe 11 we can sit down and have a cup of coffee and we will talk 12 about sealing and the judicial function. 13 professor at the University of Texas Law School. 14 Bernie Ward. 15 He never referred to Federal judges as Federal judges. 16 always referred to them as judges of the Third Article. 17 But there was a His name was He was a great admirer of the Federal judiciary. He And in a memorial that he delivered of a wonderful 18 judge of the Fourth Circuit who had died, a judge by the name 19 of Braxton Craven, I go back to this from time to time because 20 it just renews a sense of what it is I am all about. 21 Professor Ward talks about an event in 1802 in the 22 House of Representatives when there was an effort to repeal 23 the Judiciary Act of 1801. 24 Delaware, by the name of Bayard, rose and argued against the 25 repeal of the Judiciary Act of 1801 and why, he asked, did the VB A representative of the State of OCR CRR Proceedings 16 1 gentleman fear the judges? 2 for the repeal of the Judiciary Act of 1801. 3 The gentlemen who were advocating Why, he asked -- this was Representative Bayard -- 4 did the gentleman fear the judges? 5 privileged order. 6 The judges are not a They have no shelter but their innocence. Isn't that a marvelous line? They have no shelter 7 but their innocence, and I can go on with some other stirring 8 things that Professor Ward said at that point. 9 But underlying that, one gets a sense that really 10 there is a notion that we are really not all that innocent; 11 that we have to be continually examined and tested. 12 is appropriate. 13 be a presumption that we are not innocent. 14 Certainly appropriate. And that But there should not Mr. Bralow, it has been a pleasure to see you. And 15 I have not asked the Government or Mr. Wolf to say anything 16 because what they would probably say here is all the things 17 you said that they have been saying in the past, whether those 18 are what they are going to continue to tell me, I do not know. 19 Whether there is something else that they have, or the 20 Government knows with respect to Government investigations, or 21 whatever, I do not know. 22 do it, but to do it in open court, which I think would defeat 23 the whole purpose of sealing or unsealing. I will give them an opportunity to 24 A lot of questions which you have not addressed in 25 your memorandum, there was no appropriate need for you to do VB OCR CRR Proceedings 17 1 it. A lot of interesting questions as to whether 5K1 letters 2 have been -- there is experience in logic. 3 far back the 5K letters go in history, to talk about 4 historically. 5 the 5K1 letters do more than what the Pre-Sentence Report 6 says. 7 of the defendant, or details about his cooperation. 8 not looked at them in a long time. Historically how They are judicial documents, it is true, but They provide more than the social history, background 9 I have I think I had better pay attention to Sir Francis 10 Bacon. He said an over speaking judge is no well-tuned symbol 11 and end the proceedings here. 12 I thank you very much. 13 Give some thought to some of the things I have been 14 saying, Mr. Bralow. 15 MR. BRALOW: 16 THE COURT: I certainly, Your Honor. The interest now, which had nothing to 17 do, nothing to do with the criminal prosecution going back to 18 1998. Not a thing. 19 And to the extent that there is not or there is some 20 interest in Sater and Trump, it did not happen here. 21 happened in the Southern District with respect to that action 22 that was brought and things that were attached to that 23 complaint. 24 25 It And I think -- I do not know whether the record there is still sealed. I am not sure. VB OCR It has gone through a CRR Proceedings 1 18 couple of judges. 2 MR. BRALOW: 3 THE COURT: Yes. I think it was Judge Buchwald initially 4 and then Judge Engelmayer. 5 Southern District is dealing with that case now. 6 know whether that record is sealed, is it? 7 I think some other judge in the MR. AGANGA-WILLIAMS: I do not Your Honor, there are portions 8 of it that are sealed that are sealed by virtue of 9 Judge Cogan's orders. That case has since been settled, the 10 2010 case. But there were -- and primarily because of the 11 Pre-Sentence Report, those documents or the portions of those 12 documents that contain references to the Pre-Sentence Report 13 as indicated by Judge Cogan, affirmed by the Second Circuit, 14 Judge Chen, again here in 2017, again affirmed by the Second 15 Circuit. That is what remains sealed as indicated. 16 THE COURT: 17 the law of the case. 18 19 MR. BRALOW: Well, another interesting question is Your Honor, just a procedural issue, if I may. 20 THE COURT: 21 MR. BRALOW: Yes, please. If it would be helpful, I suggest maybe 22 it would be, that I participate in some way in the hearing, 23 not for me to be involved in the -- perhaps I would like the 24 Court to consider how I can provide at least argument with 25 respect to what should or should not be continued to be sealed VB OCR CRR Proceedings 19 1 at some subsequent time when you have the hearing, 2 understanding the nature of why the Court wants to have it 3 sealed. 4 THE COURT: I think you have made your argument as 5 effectively as you could possibly make it in your memorandum. 6 I do not know what else you can add to it. 7 MR. BRALOW: 8 THE COURT: 9 Okay. Thank you very much. I appreciate your invitation, but as of now, I will reject it. 10 MR. BRALOW: Okay. Thank you, Your Honor. 11 THE COURT: 12 Have a good day and enjoy the rest of it. 13 ALL: 14 THE COURT: Thank you very much. Thank you, Your Honor. Now, with respect to the Government and 15 Mr. Wolf, let's set a time. I think we may need an entire 16 afternoon, if not more, to review these documents and make 17 whatever it is you have to make to try to convince me that 18 they should remain to be settled. 19 I will make the appropriate findings. 20 an order to maintain the documents sealed -- I keep saying 21 settled, I mean sealed -- and to the extent that I make a 22 determination that there is no justification for them, that 23 would be the end of that. 24 more to add. 25 If there is I do not think there is anything So why don't you and Mr. Kessler, you being the VB OCR CRR 20 Proceedings 1 Government and you, Mr. Wolf, fix a time that is appropriate 2 for you and for me, set aside an entire afternoon, at the very 3 least, to consider. 4 of the documents, I think, are without any problem and will 5 probably be unsealed, at least a quick look through at 6 Mr. Bralow's request. There are not too many documents. Most 7 There are significant documents otherwise, which 8 Mr. Bralow has been talking about, we will have to examine 9 those and you will have to tell me what it is that I do not 10 11 know now, if anything, okay? Thank you. 12 13 (Matter concluded.) 14 15 oooOooo 16 17 18 19 20 21 22 23 24 25 VB OCR CRR I certify that the foregoing is a correct transcript from the record of proceedings in the above-entitled matter. /s/ Victoria A. Torres Butler April 29, 2019