Business
How cryptocurrency executives helped decide the California Senate primary
In the days before the California Senate primary, political ads calling Rep. Katie Porter (D-Irvine) a fake, an actor and a hypocrite inundated social media platforms and television programs.
The $10-million bill for the advertisements, which were designed to bump Porter out of the race for a rare open Senate seat, was footed by a super PAC called Fairshake that is funded by cryptocurrency companies and their executives.
As primary results rolled in that showed Porter a distant third behind Rep. Adam B. Schiff of Burbank and Republican Steve Garvey, Fairshake boasted that the Orange County lawmaker’s alliance with mentor Sen. Elizabeth Warren (D-Mass.), a vocal skeptic of cryptocurrency, had “ended her career in Congress.”
Porter later blamed her loss on “an onslaught of billionaires spending millions to rig this election,” a not-too-subtle allusion to the crypto group’s major donors.
After two years of bad headlines, including the conviction of FTX founder Sam Bankman-Fried on fraud charges, the cryptocurrency industry is back in the political arena, flexing its significant cash reserves in the 2024 election cycle. The California Senate race is one of many in which the industry has signaled that it will boost candidates who support more favorable crypto laws in Washington, and oust those who don’t.
“That amount of money buys you a seat at the political table in Washington, D.C., and that’s their goal,” said Dennis Kelleher, chief executive and co-founder of Better Markets, a financial watchdog group that has been a frequent opponent of the crypto industry in Washington.
The Securities and Exchange Commission has asserted in court that cryptocurrency should be regulated like stocks and bonds, which would require trading firms to follow a wide range of disclosure and investor protection laws. The industry has lobbied for more favorable regulations, including allowing the markets to be regulated by the smaller Commodity Futures Trading Commission.
Fairshake was the largest outside spender in the Senate primary, but to what extent it moved the needle is a matter of debate. Schiff and his allies spent prodigiously to boost Garvey among Republican voters, blanketing the state with ads that described the retired baseball star as a two-time Trump voter who was “too conservative for California.”
Under California’s unusual primary system, the two candidates who receive the most votes in the primary advance to the November election, regardless of their political affiliation. Schiff’s team gambled that in a deep-blue state, his path to victory would be easier if he faced a Republican.
“When you look at everything else going on in that race, I’m extremely skeptical that they had any impact,” Kelleher said of the cryptocurrency ads. He cited Schiff’s campaign strategy of boosting Garvey and the major support from leaders in the Democratic Party, including Speaker Emerita Nancy Pelosi (D-San Francisco), as well as Schiff’s long resume and Porter’s status as a relative newcomer in Democratic politics.
Polling from the week before the election found Garvey and Schiff in a fight for first, although Porter received a lower share of votes than polls predicted. Who will fill the remainder of the late Dianne Feinstein’s term in the Senate, as well as a six-year term that starts in 2025, will be decided on the November ballot.
Sawyer Hackett, a spokesman for the Progressive Change Campaign Committee, which backed Porter, said the $10-million ad buy “probably contributed a significant amount” to Porter’s loss. In California’s costly media markets, he said, $10 million doesn’t win or lose a race, but “it’s certainly a major factor, especially when you’re talking about the final weeks of the election when Democratic voters are considering the options in front of them.”
He said he wasn’t surprised to see the crypto industry spending against Porter, who has a “somewhat minor” track record on crypto issues but has proved herself willing to take on major industries to defend consumers. The crypto industry, he said, is “targeting candidates with an overall brand that seems to be focused on antitrust and pro-consumer policy.”
Fairshake’s major donors include venture capital giants Marc Andreessen and Ben Horowitz, who have invested in dozens of crypto companies; crypto investors Cameron and Tyler Winklevoss; and Brian Armstrong, the chief executive of Coinbase, which is listed on the Nasdaq market.
Coinbase, which has the highest trading volume of any crypto exchange in the U.S., is working this year to make sure that “candidates and incumbents continue to think about crypto as an opportunity to really make a difference to change, to protect jobs, to protect national security,” said Kara Calvert, the company’s head of U.S. policy.
Coinbase will be working to “educate” members of Congress through November, she said, so that “when they get asked about crypto at a town hall, or when they get asked about crypto by Fairshake, or by any of the rest of these organizations, that they know what they’re talking about.”
On the afternoon before election day, a group called Stand With Crypto hosted a get-out-the-vote rally for crypto owners in Los Angeles. A line stretched around the block on Hollywood’s Walk of Fame outside the Bourbon Room bar for an event headlined by the rapper Nas, who was an early investor in Coinbase.
Inside, as guests ate sliders and drank Sofia Coppola wine, Armstrong told the crowd that they needed to vote to send a “very clear message” for the November election that “you’ve got to understand innovation, you’ve got to be pro-tech, pro-innovation, pro-crypto, to get elected and be representing our values in California.”
Armstrong didn’t name any California Senate candidates, instead directing voters to a guide prepared by Stand With Crypto, which, as a political 501(c)4 nonprofit organization, is not required to disclose its donors. The guide described Schiff as “strongly supportive” of crypto and Porter as “strongly against.” Garvey and Rep. Barbara Lee of Oakland, the other candidates in the race, are listed as “pending,” with a question mark icon.
Porter’s “F” rating cited three references, including a post on X, formerly Twitter, in which she called Fairshake’s backers “shadowy crypto billionaires” because of their ad campaign against her, as well as her signature on a 2022 letter that Warren sent to the Texas power grid authority, questioning its practice of paying crypto mining businesses to shut off power during peak periods. Some companies reported earning more from the payments than from their mining operations, Warren wrote.
Stand With Crypto also said Porter voted “nay” last summer in the House finance committee markup of a cryptocurrency bill favored by the industry. But Porter isn’t a member of that committee and her name does not appear on the vote sheet. Porter did not vote on the legislation, her spokeswoman said.
Schiff’s “A” rating on crypto issues was attributed to a single statement on his campaign website that said the U.S. needs to “develop comprehensive regulatory frameworks” to ensure that cryptocurrency and blockchain companies “stay here and grow here, and that the United States remains the global leader in these important new technologies.”
Schiff told reporters during a campaign stop in San Francisco last week that he supports “clear rules of the road” and “sound regulation” for cryptocurrency companies that protect consumers but keep the firms in the U.S.
Business
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Business
Civil case against Alec Baldwin, ‘Rust’ movie producers advances toward a trial
Nearly two years after actor Alec Baldwin was cleared of criminal charges in the “Rust” movie shooting death, a long simmering civil negligence case is inching toward a trial this fall.
On Friday, a Los Angeles Superior Court judge denied a summary judgment motion requested by the film producers Rust Movie Productions LLC, as well as actor-producer Baldwin and his firm El Dorado Pictures to dismiss the case.
During a hearing, Superior Court Judge Maurice Leiter set an Oct. 12 trial date.
The negligence suit was brought more than four years ago by Serge Svetnoy, who served as the chief lighting technician on the problem-plagued western film. Svetnoy was close friends with cinematographer Halyna Hutchins and held her in his arms as she lay dying on the floor of the New Mexico movie set. Baldwin’s firearm had discharged, launching a .45 caliber bullet, which struck and killed her.
The Bonanza Creek Ranch in Santa Fe, N.M. in 2021.
(Jae C. Hong / Associated Press)
Svetnoy was the first crew member of the ill-fated western to bring a lawsuit against the producers, alleging they were negligent in Hutchins’ October 2021 death. He maintains he has suffered trauma in the years since. In addition to negligence, his lawsuit also accuses the producers of intentional infliction of emotional distress.
Prosecutors dropped criminal charges against Baldwin, who has long maintained he was not responsible for Hutchins’ death.
“We are pleased with the Court’s decision denying the motions for summary judgment filed by Rust Movie Productions and Mr. Baldwin,” lawyers Gary Dordick and John Upton, who represent Svetnoy, said in a statement following the hearing. “He looks forward to finally having his day in court on this long-pending matter.”
The judge denied the defendants’ request to dismiss the negligence, emotional distress and punitive damages claims. One count directed at Baldwin, alleging assault, was dropped.
Svetnoy has said the bullet whizzed past his head and “narrowly missed him,” according to the gaffer’s suit.
Attorneys representing Baldwin and the producers were not immediately available for comment.
Svetnoy and Hutchins had been friends for more than five years and worked together on nine film productions. Both were immigrants from Ukraine, and they spent holidays together with their families.
On Oct. 21, 2021, he was helping prepare for an afternoon of filming in a wooden church on Bonanza Creek Ranch. Hutchins was conversing with Baldwin to set up a camera angle that Hutchins wanted to depict: a close-up image of the barrel of Baldwin’s revolver.
The day had been chaotic because Hutchins’ union camera crew had walked off the set to protest the lack of nearby housing and previous alleged safety violations with the firearms on the set.
Instead of postponing filming to resolve the labor dispute, producers pushed forward, crew members alleged.
New Mexico prosecutors prevailed in a criminal case against the armorer, Hannah Gutierrez, in March 2024. She served more than a year in a state women’s prison for her involuntary manslaughter conviction before being released last year.
Baldwin faced a similar charge, but the case against him unraveled spectacularly.
On the second day of his July 2024 trial, his criminal defense attorneys — Luke Nikas and Alex Spiro — presented evidence that prosecutors and sheriff’s deputies withheld evidence that may have helped his defense . The judge was furious, setting Baldwin free.
Variety first reported on Friday’s court action.
Business
California’s gas prices push Uber and Lyft drivers off the road
The highest gas prices in the country are making it tougher for some gig drivers to make a living.
Gas prices have shot up amid the war in the Middle East. On average, California gas prices are the most expensive in the United States, according to data from the American Automobile Assn. The average price of regular gas in California is almost $6. The national average is a little above $4.
While Uber and Lyft drivers have concocted clever ways to cut gas consumption, they say that without some relief they will be forced to leave the ride-hailing business.
John Mejia was already struggling to make money as a part-time Lyft driver when soaring gas prices made his side hustle even harder.
“Unfortunately, it’s the economics of paying less to drivers and gas prices,” he said. “It actually is pulling people out of the business.”
Guests at The Westin St. Francis hotel get into an Uber.
(Jess Lynn Goss / For The Times)
Gig work offers drivers the freedom to work for themselves and more flexibility, but being independent contractors also means they must shoulder unexpected costs.
Ride-sharing companies say they’re trying to help, but drivers say the gas relief comes with caveats. For now, drivers say they’re being pickier about what rides they accept, cutting hours and are looking at other ways to make money.
Mejia, who started driving for Lyft more than a decade ago, said in his early days, he would sometimes make $400 in three hours. Now it takes 12 hours to rake in $200.
The San Francisco Bay Area consultant is an active member of the California Gig Workers Union, so he knows he isn’t alone. California has more than 800,000 gig rideshare drivers, according to the group, which is affiliated with the Service Employees International Union.
On social media sites such as Reddit and Facebook, gig workers have posted about how the higher gas prices are eating into their earnings. Among the tricks they are suggesting: reducing the number of times the ignition is turned on or off, avoiding traffic, working in specific neighborhoods and at times with high demand and switching to electric vehicles.
Gig drivers usually have only seconds to decide whether to accept a ride on the app, but they have become more strategic about which rides and deliveries they accept.
That means they are more likely to sit back in their cars and wait for higher fares for quick pick-up and drop-off.
“I highly recommend the ‘decline and recline’ strategy, rejecting unprofitable rides until a better one appears,” wrote Sergio Avedian, a driver, in the popular blog the Rideshare Guy.
Pedestrians cross the street in front of a Lyft and Uber driver on Wednesday. High gas prices have made it hard for gig drivers to make a living, cutting into their profits.
(Jess Lynn Goss / For The Times)
Uber, Lyft and other companies have unveiled several ways to help drivers save on gas.
Uber said drivers can get up to 15% cash back through May 26 with the Uber Pro card, a business debit Mastercard for drivers and couriers. Based on a worker’s tier, they can get up to $1 off per gallon of gas through Upside — an app that offers cash rewards — and up to 21 cents off per gallon of gas with Shell Fuel Rewards. The company also offers incentives for drivers who want to switch to electric vehicles.
“We know the price of gas is top of mind for many rideshare and delivery drivers across the country right now,” Uber said in a blog post about its gas savings efforts.
Lyft also said it’s expanding gas relief through May 26 because the company knows that the extra cost “hits hardest for drivers who depend on driving for their income.”
The company is offering more cash back, depending on the driver’s tier, for drivers who use a Lyft Direct business debit card to pay for gas at eligible gas stations. They can get an additional 14 cents per gallon off through Upside.
Drivers say the fine print on the offers dictates which card they use and where they fill up gas, making it difficult for them to save money.
“If I do the math, it’s ridiculous,” Mejia said. “They’re offering us nothing.”
Uber declined to comment, but pointed to its blog post about the gas relief efforts. Lyft also referenced the blog post and said “the gas savings were structured through rewards to maximize stackable opportunities.”
Guests at The Westin St. Francis hotel get into an Uber.
(Jess Lynn Goss / For The Times)
Gig workers have struggled with rising gas prices in the past.
In 2022, Lyft and Uber temporarily added a surcharge to their fares amid record-high gas prices following Russia’s invasion of Ukraine. This year, Uber is adding a fuel charge to its fares in Australia for roughly two months to offset the high cost of gas for drivers. Lyft said it hasn’t added a fuel charge in the U.S. or elsewhere.
Margarita Penalosa, who drives full time for Uber and Lyft in Los Angeles, started as a rideshare driver in 2017. Back then, gas was cheaper. She would easily hit her goal of making $300 in eight hours. Now she’s making just $250 after working as much as 14 hours.
Gas prices, she said, used to be less than $3 per gallon. Now some gas stations are charging more than $8 per gallon.
“Take out the gas. Take out the mileage from my car and maintenance. How much [do] I really make? Probably I get $11 for an hour,” she said.
Jonathan Tipton Meyers wants to spend fewer hours as a rideshare driver.
He already juggles multiple gigs even while driving for Uber and Lyft in Los Angeles. He’s a mobile notary and loan signing agent, a writer and performer.
Driving is “a very challenging, full-time job,” he said. “It’s very taxing and, of course, wages were just continually decreasing.”
John Mejia, a longtime Lyft and Uber driver, poses for a portrait before attending a meeting about unionizing gig drivers.
(Jess Lynn Goss / For The Times)
Even if oil continues to flow through the Strait of Hormuz, which Iran reopened Friday, it could take a while for gas prices to come down to earth, said Mark Zandi, the chief economist at Moody’s Analytics.
“There’s an old adage that prices rise like a rocket and fall like a feather,” he said. “I think that’ll apply.”
In the meantime, it will be survival of the fittest drivers. If enough of them decide to leave the apps, the ride-hailing companies could be forced to raise fares further to attract some back.
“Those who approach rideshare driving strategically, tracking expenses, choosing trips carefully, and optimizing efficiency are far more likely to weather periods of high gas prices,” wrote Avedian in the Rideshare Guy blog. “For everyone else, a spike at the pump can quickly turn rideshare driving from a side hustle into a money-losing venture.”
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