The Cohen case is heating up.
Sources close to the matter have apparently told mainstream media outlets that Michael Cohen, President Trump’s former lawyer and greatest political liability at the moment, is likely to cooperate with investigators going forward.
Cohen’s lawyers, Stephen Ryan and Todd Harrison of McDermott, Will & Emery LLP, are apparently abandoning his case. A “source familiar with the matter” (so, obviously take this with a grain of salt) told ABC that one of the reasons Cohen’s defense team is leaving is a “fee dispute.”
Regardless of the danger of believing anything the mainstream media reports as coming from “a source familiar with the matter,” this is actually pretty believable. We’ve known for a while that Michael Cohen is in moderate to severe financial trouble. His business, for example, sank a lot of money into taxi medallions, which turned out to be a very poor investment.
Taxi medallions, in case you care at all, are a relic of New York City’s awful protectionist rules. Back in the 1930s, the New York City Taxi & Limousine Commission decided to legally limit the number of cabs that could be operating in New York at any time. So they started issuing “medallions” that authorize a specific taxi to operate.
The only way to get a medallion was to buy one off of somebody who already had one. And since the supply was starkly limited, and the demand for cabs was always high, they were a guaranteed money-maker. But the cost of a taxi-ride simply kept climbing because of the total lack of competition and the city’s artificial supply caps.
Then Uber came along. More convenient, more available, and infinitely cheaper than a ride in a real taxi, Uber destroyed the value of taxi medallions within a matter of years. In 2013 a taxi medallion was worth nearly $1.05 million.
Today, they’re worth about $200,000 each. And a lot of the drivers (predominantly immigrants) who labored for years to afford their own medallion and start driving for themselves, planning to sell the medallion to somebody else when they wanted to retire, have been left in massive debt.
But that’s sort of what you get when the government dips its filthy toes into the waters of the free market. And like all those immigrant families, Michael Cohen also bet big on taxi medallions. He owned at least 30 New York City medallions at one point.
Now, he can’t even afford to pay his defense lawyers.
Michael Cohen (and the Trump administration) have been fighting for a while to get a chance to examine the materials the FBI seized from Cohen’s office in order to see whether any items are covered by attorney-client privilege before investigators get a look at them.
In other words, Cohen and his lawyers are scrambling for a chance to cook the books the FBI captured from him in the raid on his office. The judge in the Cohen case has given him some ability to due so, and has also appointed a former federal judge to act as a “special master” and conduct an impartial review of the seized items, to arbitrate any disputes over whether the materials are privileged info or not.
That “special master,” Barbara Jones, said last week that she has reviewed 300,000 items so far, and determined that only 162 are information that could be said to be covered by “attorney-client privilege.” She rejected three items that Cohen, Trump, or the Trump Organization had wanted to be declared privileged.
Cohen and his attorneys have been given until Friday to finish their review of the seized documents. There’s not much info about whether they actually will or not, however, given the apparent “wage dispute” being reported on.
All in all, it’s not looking great for Michael Cohen. And if he does cooperate with the Mueller probe, that could open up a whole new can of worms for the Trump administration.