Bear Stearns: Venue???

After all the storm-and-stress of the last two years, the criminal trial of Tannin and Cioffi may all have come down to the discomfort the jury felt over the inappropriate venue.

Venue, by standard legal definition, is "the county (or geographical division) in which an action or prosecution is brought for trial, and which is to furnish the panel of jurors."

The Bear Stearns sponsored funds managed by Cioffi and Tannin dissolved in the spring and summer of 2007, an early sign of the severity of the subprime crisis. The two men were indicted in June 2008, in the federal district court for the eastern district of New York. Here we see the venue question.

Why were they indicted and later tried in the eastern district of New York? That district consists of Long Island, Staten Island, the Queens, and Brooklyn. Didn't Tannin and Cioffi work in Manhattan? Manhattan, along with the Bronx, constitutes the SOUTHERN DISTRICT of New York. Yes, they did. And there have been times when the US Attorney for the southern district was the big cheese in such matters, the sheriff of Wall Street (that's how Rudi Giuliani first became a national figure after all, back in the 1980s).

It appears that the prosecutors in Brooklyn wanted one of the sexy insider-trading cases for themselves. Here's a story about that general subject written with reference to cases you won't recognize, but which made quite a splash at the time the summer of 2000.

But back to the Tannin/Cioffi matter. Soon after retiring to deliberate, the jury sent the judge a brief note: "Please explain venue further." This kind of trans-district poaching it seems has costs.