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Judge's order hints at trouble for Collins' defense in insider trading case

WASHINGTON – The judge in the insider trading case against Rep. Chris Collins has made his biggest decision in the case so far this year, and while the judge kept that decision a secret for now, a bare-bones order he filed publicly appears to bode badly for the Republican lawmaker from Clarence.

In an order issued Friday and made public Monday, U.S. District Court Judge Vernon S. Broderick said that he had finished his opinion on two defense motions that aim to force prosecutors to turn over more evidence in the case.

Broderick said he was keeping that opinion under seal for the time being because it refers to evidence that was redacted or filed under court seal. But he also wrote that at an status conference in the case this Thursday, Collins' lawyers should be prepared to discuss whether they plan to appeal the judge's decisions on pretrial motions.

Collins wouldn't have to appeal if the judge ruled in his favor.

Broderick didn't make clear, though, whether he was discussing motions the defense team has already made or will make in the future.

In either case, the judge's comment indicates that he might not have much sympathy for the defense's key argument: that prosecutors violated Collins' rights under the Constitution's speech or debate clause. That constitutional clause aims to protect federal lawmakers from improper pressure or interference from the other branches of the government.

Motions involving the speech or debate clause can be appealed all the way to the U.S. Supreme Court before a criminal case against a member of Congress can go to trial.

The Collins defense team already has filed one such motion: one that aims to force prosecutors to turn over more evidence so that the lawmaker's lawyers can see if it shows violations of Collins' speech or debate rights.

Broderick's opinion, which he is expected to release later this week after conferring with both sides in the case, will include a decision on that motion, along with the judge's decision on a separate defense motion seeking more evidence on other legal grounds.

Collins' lawyers have also indicated they may file a separate motion directly alleging that prosecutors violated the lawmaker's speech or debate rights – and that motion, too, could be appealed all the way to the Supreme Court.

Those potential pretrial appeals have put the case's Feb. 3, 2020, trial date in jeopardy.

[Related: Debate over constitutional clause could delay Collins' trial]

Collins was arrested along with his son, Cameron, and Stephen Zarsky, Cameron Collins' prospective father-in-law, in August 2018. All three men are charged with fraud, conspiracy and lying to the FBI.

Prosecutors say the congressman – then a board member at Innate Immunotherapeutics, an Australian biotech – gave his son a tip in June 2017 that that company's only product had failed in clinical trials.

Cameron Collins started dumping his Innate shares the next day and, according to prosecutors, averted $570,900 in losses that he would have suffered if he sold the stock after the bad news went public. Prosecutors say Cameron Collins then told Zarsky, who dumped his Innate stock, too, thereby avoiding $143,900 in losses.

The Collins defense team has raised questions about the speech or debate clause for months now. That prompted prosecutors to issue a second, revised indictment in early August – one that omitted two passages that the Collins lawyers objected to on speech or debate grounds.

One of those omitted passages referred to a separate Office of Congressional Ethics investigation of Collins' relationship with Innate, and the other involved communications between the congressman and his press secretary.

Omitting those passages from the new indictment did nothing to satisfy the Collins lawyers, who have raised the speech or debate issue in nearly every legal filing they have made in the case this year.

And while it's still unclear exactly what Broderick will say about the issue, two other elements of the judge's order seemed likely to rankle the Collins lawyers as well.

They have objected to the idea of splitting the trial in two, with Collins' son, Cameron, and another alleged co-conspirator going on trial first in February and the congressman facing jurors at a later date. But the judge made clear in his order that he is considering that two-trial proposal, which prosecutors suggested last week.

At Thursday's status conference, "the parties should be prepared to discuss ... their positions on proceeding with the trial against Cameron Collins and Stephen Zarsky as scheduled," even if Chris Collins is still appealing his speech or debate clause motions, Broderick wrote.

And while Collins' lawyers have steadfastly asked for and obtained waivers allowing Collins to skip most of the hearings in the case so far, Broderick said all three defendants must attend Thursday's status conference "because the parties will be discussing scheduling."

That means Collins will appear in court in the Southern District of New York on Thursday for the first time this year. The House is scheduled to be in session that day, meaning it's likely Collins will miss some floor votes because of his court appearance.

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