Apologies for the delay, and thank you, this is really helpful in fleshing out my models.
Am I correct that there is a ceiling on the amount of discovery that can be done? Once you have to turn over every document, there are no more documents to turn over. So the costs of speaking should asymptote over time? If not, what costs are increasingly linearly or faster?
> if the statement says nothing of substance, issuing it would have little value in the first place
is this true? I imagine there are some statements that are interesting to the EA community but bear no legal weight (“we believe fraud is bad”), and others contain information that would have been in discovery anyway.
I get the feeling one thing going on is that there are safe statements, but it’s hard for laypeople to identify them ahead of time (see: SBF outlining his incompetence as if that was a defense instead of evidence of a crime). So lawyers default to the much easier to follow “please shut the hell up”.
Do you have estimates for client time? I expect many EA orgs to care more about that than lawyers fees, especially if potential increases are only on the order of 25%.
There is likely a ceiling effect, either on the volume of discoverable things or the other side’s CEA of marginal discovery.
I think major orgs have made “we think fraud is bad” statements. I assume no one thinks fraud is good, or would admit to it if they did, so those statements have zero value to me.
Whether there are other safe statements depends on the organization’s exposure, but in many cases your lawyers would have to engage in a lot of independent factfinding to figure out if that’s the case (including needing to figure out information not held by your organization or publicly available). On the other hand, “no one here ever interacted with SBF, took FTX money, or gave him much thought” is likely safe if true and shouldn’t require much work.
There were no safe statements a lawyer could identify for SBF—that would require identifying, accessing, and ingesting all material info DOJ would obtain on him, which was/is impossible.
Really hard for me to estimate staff time given the nature of the case. You probably can substitute lawyer time for staff time for many tasks if you value staff time at mote than the lawyer’s rate.
If you’re doing a CEA, you should consider that discovery will probably happen under a protective order and any litigation will very likely be settled in a way where there is minimal leakage of the discovered info. So I don’t think it is correct to assume that unfavorable information will be publicly disclosed no matter what.
So I don’t think it is correct to assume that unfavorable information will be publicly disclosed no matter what.
This feels like a nonsequitur to me. The question is “is there information an org or person might like to disclose, but shouldn’t, due to its effect on legal risk (including procedural burden)?”. If the entity doesn’t want the information to be public then this question doesn’t arise (we could argue about whether orgs have a proactive moral duty to confess to crimes, but that’s definitely not the question here).
It sounds like you’re saying there is a ceiling on the burden for discovery, trial, etc, so at a certain point new statements can’t increase that burden, although they could have other negative consequences. Is that correct?
There is certainly a ceiling. Then again, your organization ceasing to exist because it’s overrun with legal bills and/or a crippling judgment is entered against it is a ceiling, and for smaller organizations (especially those that spent grant funds and are already going to get hit with a clawback) it may well be a realistic estimate of the ceiling.
As far as a non sequitur, I think we’re interested in somewhat different questions. My formulation is more: “What are the relative costs and benefits of making statements and releasing information on this matter?” I don’t find comparing benefits to only the increase in legal risk to be particularly decision-relevant on what organizations should do. I think almost any statement that is not “we’re giving back all the money, right now” is going to be net negative PR, and I think the increased risk of public disclosure of unfavorable information has to be considered to answer my question (it’s OK if it isn’t part of your question).
I’m not sure how to ask this but it seems like you’re...angry?… at me for trying to be precise about this? I’m not trying to challenge you, I just want to double crux to discover where our assessments differ. I thought that might have been any number of places you have expertise and I don’t, but now it seems like maybe you just don’t see value in public sense-making.
Apologies for the delay, and thank you, this is really helpful in fleshing out my models.
Am I correct that there is a ceiling on the amount of discovery that can be done? Once you have to turn over every document, there are no more documents to turn over. So the costs of speaking should asymptote over time? If not, what costs are increasingly linearly or faster?
> if the statement says nothing of substance, issuing it would have little value in the first place
is this true? I imagine there are some statements that are interesting to the EA community but bear no legal weight (“we believe fraud is bad”), and others contain information that would have been in discovery anyway.
I get the feeling one thing going on is that there are safe statements, but it’s hard for laypeople to identify them ahead of time (see: SBF outlining his incompetence as if that was a defense instead of evidence of a crime). So lawyers default to the much easier to follow “please shut the hell up”.
Do you have estimates for client time? I expect many EA orgs to care more about that than lawyers fees, especially if potential increases are only on the order of 25%.
There is likely a ceiling effect, either on the volume of discoverable things or the other side’s CEA of marginal discovery.
I think major orgs have made “we think fraud is bad” statements. I assume no one thinks fraud is good, or would admit to it if they did, so those statements have zero value to me.
Whether there are other safe statements depends on the organization’s exposure, but in many cases your lawyers would have to engage in a lot of independent factfinding to figure out if that’s the case (including needing to figure out information not held by your organization or publicly available). On the other hand, “no one here ever interacted with SBF, took FTX money, or gave him much thought” is likely safe if true and shouldn’t require much work.
There were no safe statements a lawyer could identify for SBF—that would require identifying, accessing, and ingesting all material info DOJ would obtain on him, which was/is impossible.
Really hard for me to estimate staff time given the nature of the case. You probably can substitute lawyer time for staff time for many tasks if you value staff time at mote than the lawyer’s rate.
If you’re doing a CEA, you should consider that discovery will probably happen under a protective order and any litigation will very likely be settled in a way where there is minimal leakage of the discovered info. So I don’t think it is correct to assume that unfavorable information will be publicly disclosed no matter what.
This feels like a nonsequitur to me. The question is “is there information an org or person might like to disclose, but shouldn’t, due to its effect on legal risk (including procedural burden)?”. If the entity doesn’t want the information to be public then this question doesn’t arise (we could argue about whether orgs have a proactive moral duty to confess to crimes, but that’s definitely not the question here).
It sounds like you’re saying there is a ceiling on the burden for discovery, trial, etc, so at a certain point new statements can’t increase that burden, although they could have other negative consequences. Is that correct?
There is certainly a ceiling. Then again, your organization ceasing to exist because it’s overrun with legal bills and/or a crippling judgment is entered against it is a ceiling, and for smaller organizations (especially those that spent grant funds and are already going to get hit with a clawback) it may well be a realistic estimate of the ceiling.
As far as a non sequitur, I think we’re interested in somewhat different questions. My formulation is more: “What are the relative costs and benefits of making statements and releasing information on this matter?” I don’t find comparing benefits to only the increase in legal risk to be particularly decision-relevant on what organizations should do. I think almost any statement that is not “we’re giving back all the money, right now” is going to be net negative PR, and I think the increased risk of public disclosure of unfavorable information has to be considered to answer my question (it’s OK if it isn’t part of your question).
I would note that there is a huge jump from “unfavorable information” to “confess to crimes”—for instance, there is generally no duty to rescue in common-law jurisdictions (which would include the US and UK).
I’m not sure how to ask this but it seems like you’re...angry?… at me for trying to be precise about this? I’m not trying to challenge you, I just want to double crux to discover where our assessments differ. I thought that might have been any number of places you have expertise and I don’t, but now it seems like maybe you just don’t see value in public sense-making.
My two cents: I don’t read any negative emotions from Jason’s comment