Welcome back to The Stratosphere.

Today, a special dispatch from Sam Bankman-Fried’s federal court hearing in Manhattan earlier this morning, an opportunity for America’s most notorious defendant to stretch his legs after months on house arrest in his parents’ Palo Alto home.

But first…

• About a month ago, my interest was piqued when I heard about a mystery, female tech executive who was pondering a run for the U.S. Senate. I sort of assumed it was a real heavy, on the level of Sheryl Sandberg or Marissa Mayer, someone who could self-fund their campaign with gazillions and be competitive. But yesterday I was able to break the exclusive of this person’s identity… and it wasn’t quite Sheryl or Marissa. The mystery candidate is Lexi Reese, the former chief operating officer of Gusto, who worked for Sheryl back in the day at Google. (Reese confirmed the news this morning.)

  Reese will generate a few headlines over the coming weeks, and she has enough money to pay top consultants like Celinda Lake, but let’s be clear: This is not Meg Whitman spending $140 million on her race. She is up against extraordinarily well-known California commodities Adam Schiff, Katie Porter and Barbara Lee. But we’ve found the tech angle!

And Bankman-Fried had a rare opportunity to be a little jubilant this Thursday, as he walked into court. The night before, as I was sitting on the tarmac at LAX, awaiting a delayed redeye flight to New York, news crossed the transom that S.B.F. had won his most significant legal victory to date. Federal prosecutors had agreed to “sever” their case—to not immediately proceed with five charges that they belatedly added to his indictment—while they await approval from The Bahamas, which had extradited him on narrower charges. S.B.F., for the first time since perhaps last fall, had reason to smile.

Not that I’d see it. After braving the crush of cameras that filmed his arrival at the courthouse, Sam wore a pretty blank expression—maybe with a slight spasm of amazement—as court security parted the Red Sea of a dozen or so other reporters, myself, sketch artists, and about thirty interns at the U.S. District Court. Just before 10 a.m., S.B.F. scuttled into courtroom 21B with his six or seven-person strong team: lawyers, P.R. mavens, private security, and no family.

Since he was placed in the custody of his parents, on the Stanford campus, back in December, the math-camp kid has been cosplaying as a highly-paid attorney, learning as much as possible about extradition law, straw-donor schemes, and what “fraud” really means, anyway. After all, case preparation is basically all he has on the docket these days. He must be either a lawyer’s dream client—he knows what happened at FTX better than anyone, and is taking to his defense with a self-preservationist instinct—or an absolutely arrogant nightmare.

He was perfectly polite and professional in court, but he reminded me of a fidgety high-school debater whose teammate was next at the rostrum. At multiple points, I saw him scribbling notes to the two actual lawyers seated on his left and right, Mark Cohen and Christian Everdell. Sam, his right leg often bouncing, hair as disheveled as ever, would shake his head at a stray comment from a judge or opposing counsel, flip a new page on a legal pad for transcription just like a Big Law associate might, and watch the clock as prosecutors prosecuted.

Nothing would be decided at Thursday’s two-hour hearing, one of the few before his trial kicks off in October. Kaplan, the crotchety yet occasionally jovial 78-year-old judge overseeing the case, joked about ChatGPT, Yiddish expressions, and brands of champagne. He poked holes in both the prosecutors’ and defense lawyers’ legal positioning on various motions, but suggested he was in no mood to dismiss the charges against S.B.F.

Then again, much of the heat expected at Thursday’s hearing evaporated with the assent from prosecutors to not include the five additional charges in the October trial. Kaplan did not formally sign off on that arrangement, but it now appears likely that that trial will be more limited in scope, with a second trial focused on the additional charges, possibly in the first quarter of 2024. (I’ll spare you the nitty-gritty details that revolve around the rules of extradition, but it is a bit unclear which trial the campaign-finance violation now falls into.)

Just before 12:30 p.m, Kaplan took his exit, and the courtroom began its recessional. Prosecutors, sketch artists, and the interns headed to the elevators. Sam stood up, placed his hands in pockets, and conferred with his lawyer, occasionally nodding his head. Reporters were ushered out, but I decided to linger in the hallway. It would be fifteen minutes or so before S.B.F.’s entourage emerged from the elevator bank. “How’s it going?” I asked him. “It’s going O.K., you?” he replied, as if how I was doing actually mattered.

We all headed down in separate elevators to the lobby, where his security and lawyers were plotting his exit onto Worth Street. Sam waited for his burly security to clear a path to their Black GMC colossus, and then it was time. “Let’s go. C’mon Sam,” his staff said, as he was ushered into the car. Destination, presumably? Some airport. Vacation over.