In a significant legal development, a three-judge panel from the United States Court of Appeals for the Second Circuit has rejected the motion for early release filed by former FTX CEO Sam Bankman-Fried, also known as SBF. The decision, rendered on September 21, came after SBF’s legal team argued that his continued detention was related to First Amendment issues. However, the judges on the panel, comprising John M. Walker Jr., Denny Chin, and William Nardini, upheld the ruling made by Judge Lewis Kaplan, who is overseeing SBF’s criminal case.
The key point of contention in SBF’s motion for early release was his alleged involvement in witness tampering through his speech. The appeals court ruling affirmed that Judge Kaplan had “correctly determined” that Bankman-Fried’s actions constituted witness tampering.
“The record shows that the district court thoroughly considered all of the relevant factors, including [Bankman-Fried’s] course of conduct over time that had required the district court to repeatedly tighten the conditions of release,” stated the September 21 order. It also noted that the district court had explored a less restrictive alternative proposed by SBF, involving limitations on his communications with the press, but found it impractical for the long term.
The judges further emphasized that “the district court did not err in concluding that [SBF] had failed to rebut the presumption in favor of detention,” and they found the defense team’s additional arguments unpersuasive.
SBF had previously admitted to releasing the private journals of former Alameda Research CEO Caroline Ellison to a New York Times reporter, leading to the publication of certain contents from the journals, which prosecutors categorized as witness intimidation. Additionally, SBF’s lawyers had argued that his limited access to the internet while in detention hindered his ability to prepare a proper defense for his upcoming criminal trial.
This ruling comes after a September 19 hearing in which both the Justice Department and SBF’s defense team had the opportunity to present their arguments for and against his continued detention. Judge Kaplan had revoked SBF’s $250-million bail on August 11, leading to his confinement at the Metropolitan Detention Center in Brooklyn.
With his first criminal trial scheduled to commence on October 3, the denial of the early release motion represents a significant setback for SBF, as it was likely one of his last opportunities to secure freedom before the trial. SBF has pleaded not guilty to all charges, and a second trial is expected to begin in March 2024.