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September 01, 2014

Interview with Gary P. Naftalis

A leading American trial lawyer discusses the course of his career and what makes for a good judge.

Hon. Joseph A. Greenaway Jr.

Gary P. Naftalis is a leading American trial lawyer and a Fellow of the American College of Trial Lawyers. He is the head of the litigation department and firm cochair at Kramer Levin Naftalis & Frankel LLP in New York City. He is the co-author of The Grand Jury: An Institution on Trial (with Judge Marvin E. Frankel) and Sentencing: Helping the Judges Do Their Jobs (also with Judge Frankel).

JAG: Gary, you have represented individuals and corporations around the world in all phases of complex and high-profile, bet-the-company criminal, civil, and regulatory matters for over 40 years. In other words, you are a trial lawyer’s trial lawyer. Did you grow up right here in Newark?

GN: Yes.


JAG: Which part of town?

GN: I went to Rutgers-Newark, which was a big, formative thing in my life. I commuted to college. I had a scholarship. I worked as a busboy in the summers up in the Catskills and a lot of places locally. I was fired from some of the best places in town. I worked at weddings and bar mitzvahs on the weekends. It was good money. Those were great jobs. You made a lot of money for a kid and for the times.


JAG: How did Rutgers inform your thoughts about the future and your values?

GN: Well, for one thing, I got a very good education there. One thing you learn in life is that writing is about as important a skill as there is. It can get you through a lot of stuff, especially as a lawyer. I learned how to write in English composition as a freshman. I graduated college in 1963 and I won an internship that summer. I was going to go to graduate school to study diplomatic history. My thought was to go to the State Department and into the foreign service. I drove my old car down to Washington. There were interns from all around the country. I went to a JFK press conference and watched him handle the reporters—he was so charming. I was there for the March on Washington, so I saw the “I Have a Dream” speech. I worked in something called the Leaders and Specialists Program for South Asia. It was for people thought to be rising stars in politics and journalism. It was a great job, but I did decide at the end that I didn’t want to work at the State Department.

After that, I won a fellowship to Brown for graduate school. During Christmas break, I met with one of my fraternity brothers from Rutgers who had gone off to Harvard Law School. He said to me, “What are you wasting your time in graduate school for? You want to do action stuff, you want to be a lawyer, that’s more like your thing. You don’t want to be in the library.” I didn’t realize at the time that being a lawyer meant doing research. I thought you just showed up in court. So I applied. Columbia gave me a nice scholarship, and that’s where I went.


JAG: What did your mentors inspire you to do after graduation?

GN: They encouraged me to clerk.


JAG: Who did you clerk for?

GN: For Judge [William] Herlands in the Southern District [of New York], and he was a great judge.


JAG: Did the clerkship year live up to your expectations?

GN: Yes, Judge Herlands tried a lot of big criminal cases the year I was there and it was so much fun. Then the judge encouraged me to go to the U.S. Attorney’s Office. He had spent much of his life in public service. He had been the chief assistant to Thomas Dewey [Manhattan district attorney, governor of New York, and presidential candidate] in the Rackets Investigations. He had prosecuted Lucky Luciano and other major gangsters. He was the commissioner of investigations under LaGuardia. And Dewey was a mentor to his people. A lot of his top people—top Dewey aides—were on the Southern District of New York and the New York Court of Appeals.


JAG: What did you learn substantively from Judge Herlands?

GN: The judge really knew evidence. And what did I know about evidence? I mean, I took it in law school, but you don’t know anything about evidence until you sit in a courtroom and hear a judge: Overruled on relevance, sustained on materiality. You don’t take a course in [Federal Rule of Evidence] 403. So he encouraged me. At that point I was thinking maybe I want to teach law. I applied for a fellowship to study criminology at Cambridge. And I got it. And I thought this is great. I’ve never been anywhere and I can go to Cambridge, and they gave me a lot of money.


JAG: Did you go?

GN: Well, one of the young assistant U.S. attorneys who I got to be friendly with was Abe Sofaer [later a federal district court judge]. So Abe says, “Why would you go to Cambridge? You should work for Bob Morgenthau.” And I said to him, “Can’t I do that when I come back?” And he said, “Nixon is going to be elected in ’68 and Morgenthau will no longer continue as U.S. Attorney, so you’ll miss your chance. You can always go to Cambridge.” Of course, I never did go to Cambridge.


JAG: What was the best thing about being an assistant?

GN: I learned how to be a trial lawyer—a real lawyer. Not someone who just reads law books and sits in an office, but actually goes into a courtroom and deals with a federal judge and has an adversary on the other side and people on the jury and witnesses. I learned how to prepare witnesses, how to make arguments, how to deal with agents. You grow up, and you can’t get that out of a book. I wasn’t very good when I started. I was green as grass. I didn’t even know where to stand.


JAG: What was the camaraderie like in the office? Everyone speaks fondly of their time in the U.S. Attorney’s Office, but were people generous with their time? Did they share tricks of the trade?

GN: Yes. All of the above. People weren’t in competition with each other there. Indeed, you’re rooting for each other. When my friends were trying a case, we’d go watch and root for them. If you wanted to talk about how to sum up or examine, they would be there for you. The collegiality of it was just wonderful.


JAG: Did your experience at the U.S. Attorney’s Office influence your next career move?

GN: It did influence me. At that point in time, most people coming out of the U.S. Attorney’s Office went to large law firms and became civil litigators. That was the career path. The white-collar criminal defense bar in New York was really in its infancy. You know the great law firms at that time, with the rare exception here or there, were not interested in doing [white-collar] criminal law. Those cases were referred out to single practitioners or boutiques. But I had decided I liked doing that and I wanted to do white-collar criminal defense and there were very few people out there with my background doing it.


JAG: What enticed you about white-collar criminal defense?

GN: I had tried all types of cases, all types of stuff. I was at the U.S. Attorney’s Office five and a half years and I tried a couple of big organized crime cases and the rest were big white-collar cases. I got very lucky. Sometimes things happen because you’re just lucky. After Bob Morgenthau got fired by Nixon, a number of senior assistants left, and there was a hiring freeze, so I got involved in major fraud cases. I was put in charge of the Swiss Bank investigations, something that had been done by people more experienced than I was, but I got one of the last indictments of a Swiss bank. I also inherited some of the most wonderful cases and indictments. I did all types of securities fraud and tax fraud trials. Those and a couple of big organized crime cases. I was lucky.


JAG: So what was it like when you started at Orans, Elsen, Polstein & Naftalis? You were fresh out of the U.S. Attorney’s Office, with no clients.

GN: I liked it. It was a little scary; there weren’t any clients so you’re waiting for the phone to ring. But it worked out. Some of the cases I handled at the beginning—I wouldn’t call front-page story cases. One of the first “white collar” cases I got was a friend’s referral. They were filming the Godfather II on the lower east side. I guess [Francis Ford] Coppola, as the director/producer, had ordered people to get off the streets so they could film. Some first assistant director was herding people off the streets and saying, “Get out the way.” And he banged into someone with his hand, and the guy made a complaint. He was arrested for assault. I got it dismissed, and so, of course, because of me, Godfather II became a major success.


JAG: A portent of things to come. How did you go about building your practice?

GN: I’m probably a bad person to give advice about that because I’ve been less proactive about that than I’d tell others to be. A lot of it was that I developed a reputation by doing good work and people would call me. I mean, I guess I did writing and speaking. But I was also lucky.


JAG: So you would do CLE type work?

GN: Yes, I would do CLE. I taught at Columbia and one semester at Harvard.


JAG: What did you teach?

GN: At Harvard I taught the prosecution perspective on the criminal justice system. It was fun, but it was a pain to go up there. But when they asked me to do it, I thought, “Well, Harvard wants me? How can I turn that down? Okay, I’ll get to the place.” That was hard because of the commute, but it was fun. And I thought I’d be hanging around the greats, but, you know, I was in a basement office. I went out for drinks one or two times with Alan Dershowitz, but that was it. When you were an adjunct, you were an adjunct. You weren’t hanging out with Archibald Cox.


JAG: You’ve travelled around the country trying cases before countless trial judges. If you were to put together a Mt. Rushmore of trial judges, who would you put on?

GN: First name that comes to mind is Judge Edward Weinfeld. He was God.


JAG: Did people have visceral reactions to having to appear before Judge Weinfeld?

GN: Well, first of all, he was terrifying because he was so smart and so demanding. He was just a wonderful judge. I would put him way up there. Marvin [Frankel] was great to appear before. What I loved about Marvin is that he liked advocacy. To me, the mark of a really smart guy is a willingness to change your mind. A willingness to say, “Well, I initially thought the answer was X, but, you know, you convinced me that my thinking was wrong.” He had sufficient confidence in his abilities and intellect that he wasn’t embarrassed to admit that “Gee, I was wrong about something and you were right.”

I tried the Disney case [In re Walt Disney Co. Derivative Litigation] down in Delaware court in front of Chancellor William Chandler of the Chancery Court. He has now left the bench. That was a great experience. He was a great judge to try a case in front of. He listened to the evidence, made a judgment, and he was fair. He ran the courtroom so professionally. You felt like a lawyer there.

I also always liked trying cases in front of Milton Pollack when he was on the bench. Pollack was a great trial judge. He was so smart and tough.

So those are a few of the great trial judges before whom I have tried cases.


JAG: So one of the characteristics you’ve identified that’s important in a federal judge is a willingness to be persuaded. What are some of the other qualities you think distinguish some of the really great judges from just good judges?

GN: Obviously smart. That goes without saying. I think a commitment to the job. Going back to Judge Weinfeld, one of the things he used to say is “Every case is important.” Which is really quite profound if you think about it, because not every case involves significant legal issues or personalities. But the fact that he took his job seriously, that even some minor theft from the post office deserved his attention—it is that kind of enthusiasm for the job that you want. A person wakes up in the morning and wants to be at work, and it has nothing to do with how much you get paid because, obviously, federal judges don’t get paid what they should get paid, but that desire to do the right thing, whatever it is under the circumstances.


JAG: What’s important to you in meeting and establishing a relationship with the client?

GN: To me, you want to show the client that you are committed, that you care, that they are not just another case or client.


JAG: It really seems like you put a lot of yourself into fighting for your clients. In the white-collar area, is it really a matter of you and your client against the world?

GN: Yes, to a large extent, that’s true. For one thing, in that area, a lot of the people you represent are people who have accomplished much in their lives and have reputations, and all of a sudden it’s all falling apart. Or worse. And you’re dealing with people who are often high achievers with high success and facing an environment and a system where they have so little control. Things aren’t handled as they would be handled in the business world. Generally, you have a problem and you’re the CEO and you proactively sit down and you decide “we’ll take this product off the market” or “we’ll do this, and we’ll take a hit and we’ll deal with it and be done.” The criminal justice system doesn’t work that way. And that’s a hard thing for people to handle. To be in a system where they are reactive and often passive is tough. “Why can’t we just go and talk to them and explain what happened?” To be able to tell your clients that they can’t and keep your credibility is not easy. They need to know that you’re really with them.


JAG: Is your fervor for trial as strong now as it was when you first started trying cases as an assistant?

GN: Maybe it’s a product [of the fact] that I didn’t grow up with a silver spoon in my mouth, but it’s still such a kick.


JAG: Butterflies before your opening?

GN: Oh, yeah. I read somewhere that Bill Russell used to throw up before every game, and I think Bill Russell, wow! One of the greatest competitors and he’s a real role model and that shows how much he cared. Look, if you’re going into court and you’re blasé and you don’t care about your preparation and you think you can wing it, it’s time to hang it up. I argued a case for the first time in my life down in the Fifth Circuit. So I went to New Orleans to argue and it was thrilling. This is just a nice way to spend your life.


JAG: Let me switch gears to talk about your representation of clients pre-indictment. You have an opportunity to meet with the government. How do you approach that?

GN: Well, your thoughts are I want to learn as much as possible as to what is on their mind and what their theories and evidence are so I’m in a better position to counter them. To the extent that you can make sure your client isn’t charged, that’s great. That’s the best thing you could possibly do. It may not have the glamour of a jury verdict, but it doesn’t receive public glare. It’s even more rewarding because you’ve really saved that person’s life or career.


JAG: What is your focus—talking with the prosecutor about the embarrassment of a potential loss or emphasizing the injustice?

GN: Maybe it’s all of the above. It’s showing them, look, you really don’t have a case here. There are explanations and defenses, and maybe there’s smoke but no fire when you get through it all. This strategy involves risk too. You are taking a risk that you’ll be giving away stuff. If you give away too much, it will impair your ability to surprise at trial. So you want to appeal to the prosecutor and argue that (1) there are real defenses so the case isn’t merited, so the right thing to do is not bring a case; and (2) that they will lose. They don’t want to lose. No lawyer wants to lose.


JAG: When has that approach worked best for you?

GN: If you’ve got the horses. If you can show them that they are just wrong, you can say to them, “You think A, B, C, but you’re getting the wrong information,” then you’re in a good position. If you really do have the horses, sometimes you can win by appealing to senior AUSAs. My view is that I don’t like to go over people’s heads. You always want to prevail at the lowest possible level because it is easier. But over the years, I’ve talked to people at higher levels, at times. Once when Gerry Lynch [now a judge on the U.S. Court of Appeals for the Second Circuit] was chief of the criminal division, I went to him and said, “You don’t have a case here. Don’t bring this case.” And after reviewing the evidence, no case was brought. And I have no hesitancy doing that. I just don’t like to do it too often. I think you lose your credibility if you’re always in the chief’s office arguing that every case is an injustice.


JAG: You have had many adversaries over the years. Who was among the best?

GN: You know, as an assistant, I had the privilege of trying a case against Edward Bennett Williams. And I still think 40 years later, wow, I can’t believe I tried a case against him. He was the real deal. I told his biographer, there are an awful lot of people who have reputations, and he’s one of the much smaller group that lives up to their reputation. He had the reputation of being the best trial lawyer, and he was. He was the best trial lawyer I’d ever seen. He was charming, credible, eloquent. He was the whole package and he hardly ever objected. I learned so much from trying a case against him because he knew when to pick his shots. And he could say, “Judge, I’ve been sitting here quietly, but this is really too much for me.” He knew when to make objections, when to pick his issues, and to just preserve things for the record. It was a great tactic because he had credibility with the judge. He didn’t sit there like a stone, but he didn’t waste his time on a lot of form-of-question objections if the evidence was going to come in anyway. You’ll have credibility if you don’t complain very much, so that when you do, [the judges] take it seriously.

He also had the most wonderful sense of humor and irreverence. So we’re trying this case and it was a retrial against a big financier. And we’re about to start the trial and we had picked the jury and we’re about to give openings and his client is sitting in the front row of the audience. And I said, “Ed, your client is not at the table.” And he said, “Where in the rules does it say he has to be at the table?” And I said, “He’s not a spectator—he’s the defendant!” So I go to the sidebar to Judge Wyatt and I win, and he orders his client to sit at the table. So Williams walks away from the sidebar and says to me: “You son of a bitch, that guy is the biggest pain in the neck. You think he should be at the table? He can sit with you!”


JAG: In white-collar cases, do juries expect you to propound a theory of the case?

GN: Yes, I mean, there are exceptions that prove the rule, but in the overwhelming number of cases, you need to come up with an alternate theory or reality that the jury can grab on to in order for them to find your way. And I think you hit it right on the head because, look, in the classic biblical crime cases, lots of people can try those cases on a reasonable doubt basis. How come there are no fingerprints? The investigators screwed up. This case is a mess. That’s a little harder to do in a complicated paper fraud case. You can do that in a two-buy narcotic case or a bank robbery where the issues are simple and the reasonable doubt holes are easier to create. I also think—I’m a big believer in opening statements. To the extent that a defense lawyer doesn’t give a good opening, that’s a major mistake.


JAG: Do you ever reserve [the right to give an opening statement until the beginning of the defense case]?

GN: Never. As soon as you say never, the guy pulls out a transcript. But reserving would be against my belief on the way you try cases. The government is at the zenith of its credibility with those 12 people after the prosecutor has sat down and finished her opening statement. She has told those 12 people, in no uncertain terms, how terrible the defendant is and how terrible the crime is and the gravity of this matter. I think if you don’t open then, it’s like a slow plea of guilty because the jurors remember what the prosecutor told them. So I think you have to give a good opening and tell them there’s another way of looking at the facts, and let me tell you what the facts really show, and let me tell you what the prosecutor didn’t tell you. Because the beauty about a defense opening is that it does not get rebutted. So what you say is the last thing the jury hears.


JAG: Where does the presumption of innocence fit into the dynamic?

GN: In a criminal case, you know, the judge ritualistically and properly will charge jurors on the presumption of innocence. But I don’t think there’s any presumption of innocence in the real world in the jurors’ minds. The judge can tell them that, but the jurors always start—especially if it’s a case of some significance, but maybe all cases—with the assumption that the government isn’t going to waste their time bringing a bad case. It’s actually common sense—why would they bring this case if he’s not guilty? He’s more likely than not guilty. So it’s not like he’s presumed innocent. It’s almost as though he is presumed guilty. The playing field isn’t level, so you’re trying to level the playing field, and that’s why you have to open.

JAG: Defense counsel often argue or complain that the government’s unlimited resources leads to an inequity that cannot be overcome. Depending on the client and type of case, sometimes the inequity is insurmountable, but some argue that in white-collar cases, the resource gap can be mitigated. Do you think in your cases in the white-collar area you can match resources with the government and go toe to toe?

GN: Well, I think there’s a big gap. In some cases, there’s a real mismatch favoring the government because they have the FBI and the SEC and the postal inspectors and grand juries and immunity, and the discovery is much more restricted on the criminal side. On the civil side, you get everything, maybe more than you want. On the criminal side, you get less than you want. No depositions. But, look, in some cases, if you have a corporation or individual with the resources, then you have a much closer case and you can get experts and investigators and jury consultants and all kinds of stuff. But the one thing you can’t avoid is that the world believes that people don’t get charged by mistake, that kind of commonsense feeling, “People don’t get indicted out of the blue.” Unless it’s the rare kind of case where there is some feeling of unfairness. That’s a very small subset. Unless you find ill motivation from the prosecutor’s office, the starting place is. . . . Well, I think about my two kids who are AUSAs. The government lawyers are young, nice looking, don’t look rich, look like they are working for God and country, and they come out there and unless they throw it all away by acting like jerks or heavy-handed thugs, then it’s just “I’m a young kid, doing my job.” And it’s true. That makes up for a lot of experts.


JAG: Has your access to resources ever made a tangible difference in the type of defense you could present?

GN: Yes, in my view, to have the benefit of a jury consultant is really worth something—it really is. To think about how your theory plays and what doesn’t work. That’s not inexpensive. And to be able to have that advantage, that’s a good thing. To do focus groups and think about how you’re trying your case.

I had a case where the defense was statute of limitations. And this goes back some years. And I thought we can’t argue this to the jury. The jury will think here is this guilty guy with a high-priced lawyer and it’s a technical thing and you’re ducking the merits. So we tried it in a focus group and we watched them through a mirror. And one guy says, “You know, I don’t know why we have to spend a lot of time on this. They brought the case too late, and if you’re late, you lose.” So, when I tried the case, I said to the jury, “When you’re late, you lose!” Now I thought about that juror’s reaction. . . . When you hear something like that, it reinforces your faith because sometimes they are smarter than you are. And they usually get it right.


JAG: Many more people want Gary Naftalis to represent them than is physically possible. How do you decide on whether your answer is “yes, I’ve got time” or “sorry, I don’t have time”?

GN: I think, obviously, if you like the person and you like the cause. If it’s somebody you really like and the cause is something that interests you. If it’s compelling. You find time to do something that’s exciting and energizing, that you believe in, or you think there’s an injustice or a wrong. And you hope you pick right.


JAG: If you were talking to a group of students about to graduate or in their early years of practice, what would your advice be, if they had an inkling to follow your footsteps into the white-collar area?

GN: I think being a trial lawyer is a noble way to earn a living and to live your life. I really do. And to represent people in dealing with the government, and institutions as well. Some of the best things I ever did were to save a couple of investment firms—Salomon Brothers and Kidder Peabody—from going under and out of business because prosecuting them would have killed the firms. It’s a wonderful way to live your life, I think. There’s a lot to be said for working in the government for some part of your career—learning how to do it and how the system works. That’s why clerking is so important, and I think clerks are the best people to hire. Because they understand how the system works, how judges make decisions, how trials work. What persuades people, what doesn’t persuade people—I think that’s the kind of stuff people should do if they can. Especially if you’re going to spend a lot of your life in the private sector, it’s good to do a little time in the public sector.


JAG: You’ve met and interacted with justices of the Supreme Court, appellate and trial judges, and the titans of Wall Street. Despite these encounters, was there ever a time when you were flummoxed by the moment?

GN: In 2008, Obama and McCain are running for president, and because I had been doing some work for the Archdiocese of New York, I got invited (and it was the only time I ever went) to the Al Smith dinner. Senators Obama and McCain are there and they were both great and making jokes. In any event, they have a big, long receiving line, where you get to meet and shake the hand of McCain, and then Cardinal Egan, and then Obama. So I see the Cardinal and he says, “Gary, it’s so great to see you. So glad you could come!” And he says, “Let me introduce you to Senator Obama.” So he introduces me and says, “Senator Obama, this is Gary Naftalis, the best lawyer in New York!” And I thought to myself. I wish my wife and kids were here! So Senator Obama proceeds to engage me: “Oh that’s great! What firm are you at? Do you have your own firm?” So normally I like to call the firm Kramer Levin Naftalis & Frankel. But I’m so tongue-tied and star-struck. So, to the guy who’s about to become president, I stammer, “No, I’m not— no, I—no, I work at Kramer Levin.” Not Kramer Levin Naftalis & Frankel. I thought to myself you can take the kid out of Newark, but you can’t take the Newark out of the kid. I mean, this is the guy who’s about to become the president of the United States and he’s talking to me.


JAG: As trial lawyers, we all live for “that” moment, a Perry Mason moment, if you will. Please share with us one of yours.

GN: I would say those moments in court where you really feel great. I tried a case, a big stock market manipulation case, and the government had this big accomplice witness on the stand, Mr. Couri. He’s testifying about the terrible things my client and the codefendants did with him and rigging the stock, et cetera. He’s portraying himself as (1) he’s reformed, and (2) that he expects to be severely punished. He expects to go to jail—no question. We do a little investigating and we served a subpoena on his tailor. So I’m finishing cross and now I’m examining his cooperation deal with the government. I say, “You committed all these crimes and you could face enormous amounts of time, you could spend the rest of your life in jail, but you’re expecting the government will go to bat for you and basically you don’t truly expect, in your heart, to spend a minute in jail.” And he says, “That’s not true.” And I say, “Mr. Couri. Come on, isn’t it true that everything you’ve done since you’ve pled guilty is premised on your belief that you’re never going to spend a day in jail?” He says, “No, of course not.” I say, “Do you know Mr. Sills, a custom tailor? He makes very expensive suits—thousands of dollars per suit. Isn’t it true that in the time since you pled guilty, that you’ve bought 10 custom-made suits and four custom-made sports jackets and a custom-made tuxedo? And if you truly believed you were going to jail, weren’t you at all concerned that the styles might change by the time you were out of the penitentiary?” And I’m like Bob Hope. The courtroom is in hysterics. And I’m thinking to myself, “I’m Clarence Darrow, I’m Edward Bennett Williams, I’m sitting down and shutting up!” Let me tell you, it was worth going to work that day.

*Lauren E. Pedley, law clerk to Judge Greenaway, assisted in preparing for the interview and editing the transcript for publication.

Hon. Joseph A. Greenaway Jr.

The author sits on the U.S. Court of Appeals for the Third Circuit and is an associate editor of Litigation.*