Posts tagged as:

bankruptcy

“U.S. Bankruptcy Judge Joan Lloyd ruled Friday that attorney Bruce Atherton and [financier] Randall Scott Waldman ‘blatantly breached’ their duty to the owner of a Louisville tool machinery company by forcing him out of business and seizing his assets. …Atherton was suspended from practicing law last month by the Kentucky Supreme Court based on his guilty plea in September in Pennsylvania federal court to charges that he aided a scheme in which other defendants allegedly ‘busted out’ small businesses by pretending to buy them, then draining their assets before the deals were completed.” [Louisville Courier-Journal via ABA Journal]

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Update on Mraz v. Chrysler

by Ted Frank on September 30, 2009

Readers might remember the Mraz case, where a driver was run over by his own truck because he failed to engage the parking brake, and a jury nevertheless awarded $55 million. (March 8 and March 21, 2007.)

The Chrysler bankruptcy threw a wrench into the appellate process. Given the number of unsecured (and secured!) creditors who were taking a haircut on what Chrysler owed them, and the weakness of the case, one would expect the claim to be extinguished. But Chrysler unilaterally (and almost certainly politically) decided not to extinguish product-liability lawsuits against it, and the Mraz case has settled for $24 million. (Amanda Bronstad, “Chrysler bankruptcy judge approves $24 million personal injury settlement”, National Law Journal, Sep. 25). Of course, the likely $8-$10 million attorneys’ fee in this case is being funded by taxpayers’ bailout money.

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Critics including the Securities and Exchange Commission dispute whether receivers really deserve $27 million for their work through May in cleaning up after the collapse of Texas businessman R. Allen Stanford’s empire. [AP/USA Today; earlier]

“Golden receivers”

by Walter Olson on August 10, 2009

Fees for receivers, administrators and other professionals are eating up too much of the remaining assets of Madoff and other collapsed investment ventures, critics charge: “in one recent $6.6 million fraud, the receiver distributed 43 percent of the assets to the victim — the rest went to professionals.” [NY Post]

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August 10 roundup

by Walter Olson on August 10, 2009

  • Annals of legal marketing: law firm says its flyers offering to sue landlords over sexual assault on premises were left indiscriminately on car windshields, and it didn’t mean to target the woman who found it on hers and assumed it referred to her case [New Jersey Law Journal, Legal Blog Watch, Legal Ethics Forum]
  • “The Bankruptcy Files: Inside Michael Vick’s ‘Excessive’ Legal Bills” [AmLaw Daily]
  • Panel spanks U. of Illinois law school for admitting students at behest of politicos, but goes easy on the pols themselves [Ribstein, more, earlier here, here, here]
  • Youths who obtained big settlement in San Francisco Zoo tiger attack are having more encounters with the law [SF Chronicle, earlier]
  • Czech Republic: Suit by communist professor against critical students still in progress after 18 years [Volokh]
  • More thoughts on Florida lawmakers’ criminalization of purported gang signals, on MySpace and elsewhere [Citizen Media Law, earlier]
  • RIAA case: does the Constitution restrain unreasonable statutory damages? [Kennerly]
  • Eager law grad hoping to make a career of suing foodmakers over obesity [six years ago on Overlawyered]

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July 27 roundup

by Walter Olson on July 27, 2009

  • High-profile Pennsylvania attorney John P. Karoly Jr. pleads guilty to tax evasion, faces possible prison term [Allentown Morning Call, Legal Intelligencer, Lehigh Valley Live, WFMZ, his website; earlier]
  • Tennessee congressman pushes to overturn NBA age limit [Fanhouse, Sports Law Blog]
  • $262 million in bankruptcy fees to date for Lehman, ultimate figure could approach $1 billion [Hartley]
  • Complaint by gay altar server to Ontario Human Rights Tribunal menaces church’s autonomy [National Post via Box Turtle Bulletin]
  • Lawsuit seeks shutdown of Domelights.com, private message board for Philadelphia cops that has had “racially offensive” posts and comments [CNN, Post @ Volokh] 2002 Sotomayor decision in Pappas v. Giuliani may be on point [Popehat, Kennerly]
  • New Jersey organ scandal should come as little surprise given our failed policies on kidney donation [Satel, WSJ]
  • Deputy D.A. arrested for drunk driving lands on her feet, hired by local DWI Resource Center [KRQE, Albuquerque]
  • “San Diego Judge Denies Class Action Motions in 2007 Wildfires” [California Civil Justice]

Blawg Review #220

by Walter Olson on July 13, 2009

Welcome to Blawg Review #220, rounding up some highlights of the past week from around the legal blogosphere. It’s my second time hosting it here at Overlawyered, a blog that as its name implies maintains a certain critical distance from many of the doings of the legal profession. Despite (or because of?) that, lawyers make up a large share of our most loyal and valued readers. Overlawyered just celebrated its tenth anniversary, which so far as I know (though someone may come along to prove me wrong) makes it the oldest blog about law.

In addition to being a blogger, I’m an author of books (The Litigation Explosion, The Excuse Factory, The Rule of Lawyers) as well as many articles and shorter pieces, and a senior fellow at the Manhattan Institute, the think tank in New York City. Joining me in occasional posts is American Enterprise Institute resident fellow Ted Frank (who’s just launched a promising new venture called the Center for Class Action Fairness; his objection in a Bluetooth class action settlement won coverage in the NLJ on Friday) and even more occasionally by David Nieporent. Ted contributes a portion of this Blawg Review which is indented below.

Torts, Liability and Trial Practice

The week’s most widely blogged story, well documented by Above the Law, is a South Florida lawyer’s “Motion to Compel Defense Counsel To Wear Appropriate Shoes” at a personal injury trial, from fear that his opponent would employ a certain pair of hole-worn loafers to practice the arts of aw-shucksery on the jury. A mistrial resulted after press coverage of the motion came to the attention of jurors.

In other news, the Wall Street Journal law blog reported on the New York Yankees’ settlement with a fan who sued over not being allowed to get up and move about during the performance of “God Bless America”. Kevin Underhill at Lowering the Bar has the story of a Pomona juror who was really eager for deliberations to finish up so he could attend the Michael Jackson memorial, and wonders if the case was resolved unusually speedily that day.

On the plaintiff’s side, Steve Gursten of Michigan Auto Lawyers charges that the city of Detroit discourages the issuance of traffic tickets to its bus drivers as one way of dodging liability in subsequent accident cases where the driver’s record of violations could be used against the city. John Hochfelder at New York Injury Cases Blog says a lawsuit against the city subway system on behalf of a grossly drunk patron who tried to board between train cars is the sort of action that brings litigation into public disapprobation and might even fuel interest in relatively far-reaching reforms, like loser-pays. And Tennessee’s John Day catches a noteworthy automotive preemption case: “The Supreme Court of Appeals of West Virginia has ruled that a products liability claim was preempted by FMVSS 205, a safety standard that it says permits vehicle manufacturers to make a choice between tempered glass and laminated glass in side windows. … The United States Court of Appeals for the Fifth Circuit reached the opposite result in O’Hara v. General Motors Corp., 508 F.3d 753 (5th Cir. 2007).”

At Citizen Media Law, Andrew Moshirnia reports on a defamation lawsuit filed by a northern Illinois newspaper against a blogger: “That’s right, a newspaper (the Jeffersonian protectors of democracy) and a blogger (saving the world one lolcat at a time) are duking it out, each trying to out chill the other’s speech.”

The defense-side post of the week comes from the Beck & Herrmann team at Drug & Device Law. Mark Herrmann takes a big-picture look at how pharmaceutical product liability law has evolved over the past quarter century, and in particular how well it has done in pursuing the goal of appropriately screening out meritless cases. He gives the law a grade of “A” or thereabouts in tackling dubious expert testimony (with the Daubert revolution), in preventing the unwarranted extension of class action concepts from financial-injury cases to the realm of personal injury, and — a much newer development — in introducing serious scrutiny of claims at the pleading stage through the Supreme Court’s recent Twombly and Iqbal decisions. He is also relatively pleased with trends on preemption (despite the widespread view that defendants have suffered a decisive rebuke on that front) and on resistance to novel theories of action. On the other hand, he gives the courts a “D” on their handling of discovery and its burdens, and a grade of “F” when it comes to their overall inability to reduce the amount of litigation.

Emergency room doc/blogger White Coat has been serializing a first-person account of his malpractice trial; you can read parts eleven and twelve, bearing in mind that you’re coming in partway through the story. (The trial has concluded, but he’s not yet revealing how it ended.)

Stephanie West Allen at Idealawg, picking up on a discussion in Plaintiff magazine, says to watch out for how the other side is likely to retell your story: that way you won’t be surprised when the other side’s lawyer gets up at trial to claim the wolf was framed while portraying the scarlet-clad Miss Hood as the most heartless femme fatale since Barbara Stanwyck in Double Indemnity. And if you’re headed for alternative dispute resolution, Nancy Hudgins can tell you “A secret about mediators“.

In the News

Alas, in today’s wounded economy bankruptcy law is a standout practice area. In the case of General Motors, however, the process has gone far more quickly than most expected. John Wallbillich at Wired GC reflects on the giant automaker’s egg-timer reorganization: “The joke around Detroit is that GM went through bankruptcy in less time than it took outsiders pre-filing to get a response to voicemails and schedule a meeting.” On the consumer side, BankruptcyProf Blog (via Carolyn Elefant, Legal Blog Watch) reports that bankruptcy filings in the Central District of California have risen sharply over the year, up more than fifty percent from 5,999 in January to 9,578 in June. The year-over-year increase since the first half of 2008 is 45 percent.

Disgraced lawyer Marc Dreier is due to be sentenced this week for some of the worst defalcations laid to the account of an American lawyer in many a year; Peter Henning has commentary at the WSJ Law Blog. At a newly launched blog called Unsilent Partners, two well-known figures in the blogosphere, Colin Samuels of Infamy and Praise and Mike Semple Pigott of Charon QC, discuss recent white-collar criminal sentencing, the point of departure being federal judge Denny Chin’s sentencing of Bernard Madoff to a 150-year term.

The week’s biggest upcoming legal story is likely to be the confirmation hearing of Supreme Court nominee Sonia Sotomayor, and I’ll turn the floor over to colleague Ted Frank for some remarks on that:

The Sotomayor nomination continued to be a notable topic in the legal blogosphere this week. Jennifer Rubin noted that former Secretary of State Colin Powell, sharing Judge Sotomayor’s position favoring race-based preferences, had thrown his support behind her nomination. Meanwhile, Eric Turkewitz’s previous investigation of the judge’s “Sotomayor and Associates” law practice and the ethical implications of her choice of firm name was picked up by the New York Times, albeit (as he and Scott Greenfield both noted) without any recognition of Turkewitz’ key role in bringing this issue to light. Greenfield criticized the Times: “make no mistake about it. [Turkewitz] is the source of the New York Times story, and the absence of his name, and his blawg, in the piece is a shoddy reflection of its journalistic integrity. Don’t ask the blawgosphere to love you when you won’t love us back, boys.” But Windy Pundit defended the Times. Turkewitz found the Administration’s explanations and justifications of Sotomayor’s choice to be unpersuasive; some members of the Senate Judiciary Committee may as well, and they’ve been in contact with Turkewitz. Beldar’s reaction to the Associates flap: Meh. The WSJ Law Blog looks at the “meticulousness” characterization of Sotomayor. Stuart Taylor has a must-read blog post on how the Sotomayor panel almost succeeded in burying the Ricci case through its summary order; having failed to bury the case, Sotomayor’s supporters are making personal attacks on Ricci, who will be testifying at Sotomayor’s hearing, himself. Heather Mac Donald calls for tough questioning of Sotomayor about Ricci. If you plan on attending the hearing, watch what you wear. The Federalist Society is sponsoring an on-line debate on the nomination that includes lawyer-bloggers Tom Goldstein and Ed Whelan. And Jonathan Adler asks questions about that 1100-professor-petition in favor of Sotomayor’s nomination.

The D.C. Circuit ruled that police checkpoints in Washington, D.C., along “State Your Business, Citizen” lines, violate the Fourth Amendment. Ken at Popehat is glad. More: Volokh, Greenfield.

Allegations of egregious racial discrimination at the swimming pool of a northeast Philadelphia club are making news and seem likely to break out before long as a national story. Max Kennerly of The Beasley Firm tells the story and analyzes its legal implications here and here, while Jon Hyman recalls memories of growing up near the club.

Finally, the Scruggs judicial scandals may have faded from the national headlines in the past year but in Mississippi they’re still very much an unfolding story. Tom Freeland at North Mississippi Commentor continues to track developments.

Advice for clients

Week in and week out, one of the functions legal blogs fulfill is to advise clients and prospective clients on when to use lawyers and what to expect when using them. Thus Hingham-based Danielle Van Ess explains what estate planning does and who needs it at her blog on Massachusetts wills, trusts and estates law. At South Carolina Family Law, Ben Stevens offers a list of Facebook “don’ts” for divorcing couples, which might usefully be read in conjunction with Lawyerist’s advice on how to subpoena Facebook pages. Of course cutting through the hype is important, which is why potential clients susceptible to being impressed by “Super-Duper-Lawyer” awards and commendations might want to check out Brian Tannebaum’s amusing discovery that “in Gainesville, Florida, apparently two Super criminal defense lawyers are prosecutors”. Whoops!

Employment law

Perhaps the week’s most buzzed-about employment law case came from Hartford where veteran political reporter Shelly Sindland filed a sex and age bias complaint against Tribune Co.’s Fox 61, charging that execs at the TV station rewarded female on-air talent on the basis of bodily attractiveness rather than conventional journalistic criteria. Daniel Schwartz at his Connecticut employment law blog took a relatively sober look (and followup), but given its mature content this was a story destined to wind up at Above the Law, which gave it the full treatment.

Employees’ sometimes-imprudent talk both on the job and off continues to provide steady fodder for employment law decisions and controversies. Doug Cornelius discussed a New Jersey decision on whether and when an employer can read an employee’s email to her lawyer sent from a company-owned laptop. At Employee Rights Post, Ellen Simon discussed a recent Ninth Circuit case in which a school employee got in trouble for inflammatory online remarks. And Jon Hyman at Ohio Employer’s Law wonders how employers are supposed to avoid what has been called a “sexualized work environment” offensive to some employees when the popular culture seeping in to the workplace from all sides is often itself highly sexualized, a topic that has come up in these columns as well.

Commercial, business and tax law

Unincorporated Business Law Blog brings word of a bill being introduced by Sen. Carl Levin (D-Mich.) to crack down on state-incorporated “shell” corporations. Corporate law specialist Larry Ribstein of the University of Illinois writes, “The motivation for this piece of legislative detritus seems to be that since a tiny percentage of LLCs are being used for criminal activity let’s wreck LLCs for all firms. Hey, sounds sensible to me.”

In other news, Peter Pappas awarded his “Rick Moranis Awards” for the best tax nerd blogs. Kevin LaCroix at D & O Diary has an update on the rising tide of Foreign Corrupt Practices Act (FCPA) enforcement activity. Charon QC conveys a bit of gossip about the questionable contract terms prescribed by a well-known U.K.-based real estate firm. And Ken Adams at Adams Drafting advises that if contract-drafting seems like a boring and unrewarding part of your work day, you’re probably not doing it right.

Finally, this unsettling observation from Dan Harris at China Law Blog: “If you owe money to a Chinese company for product and you cannot pay all of your creditors, skip out on the Chinese company. Near as I can tell, there is nearly a 100% chance they will never sue you to recover.”

Intellectual property law

The Pope issued an encyclical earlier this month which, notes Cal Law Legal Pad, included the following statement: “On the part of rich countries there is excessive zeal for protecting knowledge through an unduly rigid assertion of the right to intellectual property, especially in the field of health care.” If the pontiff wasn’t upset by the story of the Mexican yellow bean patent recounted by Patently-O, it’s probably because he hadn’t heard of it. Speaking of moral authority, The Prior Art takes GOOD magazine to task for according a glowing profile to a systematic asserter of patent license rights whom some might belittle as Totally Reliant On Litigation Leverage, and suggests the magazine missed a chance to evaluate the gap between what might be remunerative legal-business strategy and what is beneficial to society. For a more upbeat view of the value of patents in spurring innovation since colonial days, Gary Odom at Patent Hawk offers a short history of patents in America.

Finally, I blogged last week about the lawsuit filed by Pez against a Pez museum that some fans had set up in California’s San Mateo County, but Ron Coleman at Likelihood of Confusion was funnier about it.

Legal issues of new media

Remember the unsuccessful suits by companies upset to discover that when Google users searched on their firm’s name, AdWords would serve them an ad for some competitor? Ryan Gile at Vegas Trademark Attorney thinks Mary Kay Cosmetics faces an “uphill battle” in a new suit against Yahoo (over mouseover search popups in email) that raises some similar issues. And Venkat Balasubramani raises the question whether Twitter has been lax, or clever, or both, in letting various other entities use Twitter-related words and phrases in their own names and promotions.

At gamelaw blog Law of the Level, Shawn Foust discussed how online games can protect the integrity of their online currencies from thefts, at least until a corps of “Space Prosecutors” can be formed. And Eugene Volokh brings news from Michigan of one of the first, if not the first, libel lawsuits arising from Wikipedia edits. It seems to raise garden-variety rather than novel issues, though, and is not filed against Wikipedia itself.

Family law

In the U.K., Justice Minister Jack Straw has announced a second round of family-court reforms. Lucy Reed at Pink Tape is anything but enthusiastic about some of the “de-lawyerizing” aspects of the proposals. John Bolch at Family Lore comments as well, and separately notes “that Conservative think tank the Centre for Social Justice will recommend that there be a compulsory three-month ‘cooling off’ period before divorce proceedings can be commenced, one of a number of proposals contained in a report Every Family Matters, to be published [July 13].” Presumably coincidentally, here in the U.S., Solangel Maldonado at Concurring Opinions considers whether current divorce laws unduly steer couples toward ending marriages rather than working through difficulties: “Given society’s interest in marriage and all of the negative consequences of divorce, should law incentivize couples to repair the marriage after infidelity? … many couples do reconcile after separation. Maybe they would not have done so had they been able to seek a divorce immediately.”

“Father Shall Not Use Profanity or Racial Epithets in the Boys’ Presence or Within Their Earshot”. Eugene Volokh wonders about the free speech implications.

Law schools

It being July, law schools are relatively quiet on the student front, but certainly not on the faculty front. Hackles have been rising over the NYU law school’s selection of Li-Ann Thio for a visiting spot in human rights law, given that in her native Singapore Thio crusaded against rights for gays. [Above the Law]. Jane Genova at Law and More covers a judge’s threatened sanctions against Harvard lawprof Charles Nesson for posting deposition excerpts online from a case in progress in which he is helping defend music downloaders. And although Ave Maria Law School is not a part of the Roman Catholic Church, it is asserting church autonomy as a defense to a suit filed by several former faculty members; Howard Wasserman at Prawfsblawg and Rick Garnett at Mirror of Justice discuss.

Many would have nominated law schools as a nearly recession-proof sector of the economy, but that’s turned out to be wrong, what with bleak prospects for many new graduates and sometimes plunging endowments at parent institutions. Famed UCLA lawprof Stephen Bainbridge asks “Is Law a Mature Industry?” and examines the implications for legal education (do we really need at least ten new law schools, as are on the drawing board now?), while the Canadian site Law21.ca wonders whether the demographics of an aging world mean that we can “say goodbye to a lot of law schools“.

State of the blawgosphere

There’s nothing like a discussion of the state of blogs to get people going. At Crime and Federalism, Mike Cernovich thinks legal blogs have gone downhill since he got online: things have grown cliquish, and the “biggest – and worst – change to the legal blogosphere has been the Rise of the Marketers,” the ones who are intent on promoting their firms and practices but don’t have anything in particular to say. If bloggers get cliquish, notes Robert Ambrogi, it’s only human nature: “With too many blogs to choose from, we tend to stick with those we know and find comfort with.”

Have you ever considered turning the best bits of your blog into a book? Join the club. Evan Schaeffer at Legal Underground shows how to make a convincing case for that kind of transformation.

Finally, if you’re looking for an old-fashioned blogger dustup complete with asperity and risk of hurt feelings, Scott Greenfield is feeling snappish toward Adrian Dayton and several others on a variety of topics that include Generation Y, social media and work/life balance (Greenfield’s basically against the latter: “When the going gets tough, no one needs a lawyer who leaves the office whenever they have something more fun to do.”) Diane Levin suggests room for accommodation, which however is not forthcoming.

Need a break from contentiousness? Check out Scott Kreppein’s pictures of the Bronx County courthouse, a building that boasts marmoreal, heroic bas-relief sculptures in what I believe is the early-FDR-period style referred to as “Greco-Deco“.

International

For a view of American law from Central and Eastern Europe, Bruce MacEwen at Adam Smith Esq. interviews Tomasz Wardynski of a large Warsaw law firm. At Arbitration Forum, Kenneth Cloke tells “Why We Need to Mediate [International] Environmental Conflicts“. Cynthia Alkon at ADR Prof brings word that the Truth and Reconciliation Commission (TRC) in the African nation of Liberia released its report this week. Chris Borgen at Opinio Juris reports on the possible disintegration of Belgium (Flanders is thinking of pulling out). Is the EU actually going to hasten the breakup of some of its ethnically diverse member states? Charon QC decides to find out how easy it is to pry information out of private British law schools. And proving that the U.S. is not always in the forefront of colorful litigation, a Polish mother has sued saying that her 13-year-old daughter came back pregnant from an Egyptian resort because of, er, male-related contamination of the hotel’s swimming pool. Michael Krauss has the story at the Manhattan Institute law blog Point of Law (disclosure: I’m its editor and also blog there).

Many thanks to Colin Samuels and Victoria Pynchon for their helpful suggestions on links to use. H. Scott Leviant will be hosting Blawg Review #221 at The Complex Litigator next week. Blawg Review has information about that, and instructions how to get your blawg posts reviewed in upcoming issues. [Edited 1 pm Monday to remove one link at the request of its site]

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The supposed “bankruptcy” process that winds up sparing politically influential constituencies keeps rolling along: let’s hope the Senate can say “no”. [Detroit News via Salmon, Drum, Manzi ("seems only fair, as the dealers paid good money for these politicians")]

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May 14 roundup

by Walter Olson on May 14, 2009

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Larry Ribstein has some pertinent comments about the rolling reinvention of debtor-creditor law going on as the Administration redistributes bankruptcy priorities away from traditional creditors and toward the UAW. And Mickey Kaus credits me with perhaps more prescience than I actually possess about the union role (not that I always venture the cynical prediction…)(cross-posted from Point of Law). More: Michael Barone, Ken Silber.

P.S. Joe Weisenthal is reminded of an episode of lawlessness that I wrote about a few months back: “Before The Chrysler Mess, There Was Republic Windows”. Incidentally, those who wonder what sort of signals the incoming Administration was sending last December about the illegal Chicago plant occupation may be interested to learn that late last month Vice President Joe Biden and Illinois Sen. Dick Durbin paid a visit to the reopened Republic Windows plant, a visit which from a news account sounds as if it might fairly be described as “triumphal” in tone.

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Those were the words of lawyers for Bernard Madoff about his sending through the mail to relatives and intimates — thus potentially spiriting away from the victims of his fraud — what turned out an estimated $1 million in jewelry and gem-encrusted watches. Eartha Kitt should have lived just a few more weeks to see it:

In retrospect, you do wonder whether she may have been getting at something with that mention of an “old-fashioned fence”.

(& welcome Andrew Sullivan readers).

In the Bayou case, the most notable recent case of massive investment fraud, lawyers had some success going after investors who’d pulled money out of the fund before its collapse — but according to Bloomberg News, quoting investor lawyer Carole Neville, $20 million of the $33 million they recovered went to pay legal fees. The piece quotes law professor Lynn LoPucki, now of Harvard, being scathing on the subject: “Bankruptcy trustees ’spend huge amounts of money trying to get money from some investors and give it back to other investors,’ LoPucki said. ‘The incentive of the trustee and the lawyers is to churn, to bring lots of cases, spend lots of time and charge lots of fees.’”

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Fueled by Weil Gotshal & Manges partner rates in the $950/hour vicinity, “fees for lawyers, accountants and financial advisers in the Lehman case may reach $906 million, according to [bankruptcy lawprof] Lynn LoPucki”. (Bloomberg, Oct. 9). Elie Mystal at Above the Law notes a recent fee survey and concludes that “Lehman is getting the most expensive bankruptcy money can buy”.

Actually, bankruptcy professionals might earn even a very rich keep if they provided a quick and decisive way to allocate losses from the failure, move Lehman assets to their most productive uses and bring relative certainty to all parties. The prospect instead of slow, chancy, and hard-fought wrangling is one major reason why the administratively assisted “speed bankruptcy” model of financial institution reorganization, seen in the Washington Mutual case, has been winning praise from knowledgeable observers (e.g. Alex Tabarrok). If speed bankruptcy seems well suited to the crisis, one reason is that conventional, protracted, lawyer-run bankruptcy seems so ill-suited. More: Roger Parloff, Fortune “Legal Pad”, American Lawyer.

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Bankruptcy clouds judgment

by Baylen Linnekin on September 22, 2008

Last year a Connecticut court convicted Illinois contractor Mark R. Koch of larceny and ordered him to repay nearly $40,000 given him by Connecticut businessman Mark Poveromo to construct a building to house the latter’s pet food shop. So why did a Missouri bankruptcy judge order Poveromo to pay the money back to Koch? (John Christoffersen, AP, “Bankruptcy judge orders victim to pay back thief”, Sept. 22).

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August 22 roundup

by Walter Olson on August 22, 2008

  • “Law school is not such a leap” for licensed Nevada prostitute’s next career move — hey, we didn’t say that, Robert Ambrogi at Law.com did [Legal Blog Watch, Bitter Lawyer]
  • Today’s representative class-action plaintiff: “For five years, her diet consisted almost exclusively of Chicken-of-the-Sea tuna…” [PoL]
  • Prolific California disabled-access filer Jarek Molski ordered to pay fees for “scorched-earth” tactics in one case, but wins a second [Metropolitan News-Enterprise via Bashman]
  • Another sperm donor surprised by legal obligation to pay child support [Santa Fe, N.M. Reporter; earlier]
  • “Lawyer Fees Jumped 50% After Bankruptcy Law Change” [ABA Journal]
  • “Whatever it takes to win a case”, and checking out jurors’ Facebook profiles is the least of it [NLJ]
  • High-profile U.K. attorney Nick Freeman registers his nickname “Mr. Loophole” [Times Online a while back]
  • When can a plaintiff claiming sexual assault sue anonymously? Courts will apply mushy balancing test [NYLJ]
  • Hold on to your hats, looks like Geoffrey Fieger is online [Fieger Time]

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Asbestos litigation continued to grow during the 1980s: by 1992, fully 100,000 claims had been resolved, but another 100,000, yet unresolved, had been filed.

A novel means of processing asbestos claims was initiated in 1988, when the Johns-Manville corporation emerged from bankruptcy and established the Manville Personal Injury Settlement Trust, the first “bankruptcy trust” set up to pay out money to asbestos claimants. Unfortunately, plaintiffs’ attorneys controlled the trust’s claimants committee and set up procedures for the trust that were advantageous to themselves, rather than potential claimants. The trust rules minimized requirements of proof of actual injury or causation (exposure to Johns-Manville products). The trust thus paid out a lot of money quickly to the attorneys, all the while exhausting its funds for potential future claimants.

In just its first nine months of operation, the trust paid out some $500 million to 12,600 claimants — and by the end of 1989, 89,000 more claimants were outstanding. Eventually, the trust had to sharply curtail payments to claimants — to 10 percent in 1995, and 5 percent in 2001. Injured claimants were literally getting a nickel on the dollar. “As of June 30, 2006, the trust had received more than 773,000 claims and paid out about $3.4 billion–just $4,400 per claimant.”

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May 12 roundup

by Walter Olson on May 12, 2008

  • Canada free speech: Islamic group files complaint against Halifax newspaper over cartoon of burka-wearing terror fan; two more libel suits aimed at online conservative voices; growing furor over complaint against Steyn/Macleans [National Post]
  • More than 5,000 students committed crimes last year in Philadelphia schools, but none were expelled — consent decrees tying system’s hands are one reason [Inquirer]
  • U.K.: Man threatened with legal action for flying pirate flag as part of daughter’s birthday party [Guardian]
  • Bankruptcy judge doesn’t plan to accept at face value Countrywide’s claim that it generated false escrow documents by mistake in foreclosure [WSJ, WSJ law blog]
  • Amid bipartisan calls to step down, Ohio AG Marc Dann [Apr. 19, May 6] hires an opposition researcher [Adler @ Volokh] on top of Washington lobbyist [Legal NewsLine], after being rebuked by judge for political suit [Dispatch]. And where’s that ethics form on the Chesley flight? [Dayton Daily News]
  • Missouri med-mal claims fall sharply after legislated damages curb [Springfield News-Leader]
  • More on Dartmouth prof Priya Venkatesan, the one who wants to sue her students — as suspected, she’s a devotee of deconstructionist Science Studies [Allen/MtC; earlier]
  • Covert plan to sabotage Chinese economy? [Wilson Center event]
  • What, never? Well, hardly ever: Docs continue to assail notion that various complications such as patient delirium, clostridium difficile infection, iatrogenic pneumothorax, etc. — not to mention falls — are “never events” [KevinMD various posts; earlier]
  • Mich. high court agrees anti-gay-marriage amendment bars municipal health benefits for domestic partners, just what key proponents had claimed it wouldn’t do [Rauch @ IGF, Carpenter @ Volokh, earlier]
  • Private service rates the safety of charter air providers — but can it afford the cost of being sued after giving a bad rating? [Three years ago on Overlawyered]

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May 6 roundup

by Walter Olson on May 6, 2008

  • Raelyn Campbell briefly captured national spotlight (”Today” show, MSNBC) with $54 million suit against Best Buy for losing laptop, but it’s now been dismissed [Shop Floor; earlier]
  • Charmed life of Florida litigators Stanley and Susan Rosenblatt continues as Miami judge awards them $218 million for class action lawsuit they lost [Daily Business Report, Krauss @ PoL; earlier here, here, and here]
  • Lerach said kickbacks were “industry practice” and “everybody was paying plaintiffs”. True? Top House GOPer Boehner wants hearings to find out [NAM "Shop Floor", WSJ law blog]
  • It’s Dannimal House! An “office rife with booze, profanity, inappropriate sexual activity, misuse of state vehicles and on-the-job threats involving the Mafia” — must be Ohio AG Marc Dann, of NYT “next Eliot Spitzer” fame [AP/NOLA, Adler @ Volokh, Above the Law, Wood @ PoL; earlier]
  • Sorry, Caplin & Drysdale, but you can’t charge full hourly rates for time spent traveling but not working on that asbestos bankruptcy [NLJ] More: Elefant.
  • Fire employee after rudely asking if she’s had a face-lift? Not unless you’ve got $1.7 million to spare [Chicago Tribune]
  • Daniel Schwartz has more analysis of that Stamford, Ct. disabled-firefighter case (May 1); if you want a fire captain to be able to read quickly at emergency scene, better spell that out explicitly in the job description [Ct Emp Law Blog]
  • As expected, star Milberg expert John Torkelsen pleads guilty to perjury arising from lies he told to conceal his contingent compensation arrangements [NLJ; earlier]
  • Case of deconstructionist prof who plans to sue her Dartmouth students makes the WSJ [Joseph Rago, op-ed page, Mindles H. Dreck @ TigerHawk; earlier]
  • How’d I do, mom? No violation of fair trial for judge’s mother to be one of the jurors [ABA Journal]
  • First sell the company’s stock short, then sue it and watch its share price drop. You mean there’s some ethical problem with that? [three years ago on Overlawyered]

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