Law And More

Law Firms So Easily Hoodwinked: Mayer Brown out almost $1 million

If law firms were public companies with shareholders, they would likely be sued by shareholders and their leaders sent packing.  All too often they have been found to be easily hoodwinked out of their or client money by employees. Those employees range from secretary to partner.  The most recent instance, at least which has reached the media, is the chief information officer who embezzled almost a million dollars from Mayer Brown in Chicago.

The CHICAGO TRIBUNE reports that yesterday former CIO at Mayer Brown David Tresch, 51, had been arrested for allegedly playing invoice games.  Those included receiving kickbacks from a vendor and then simply billing for work that was never done and pocketing it.  He was employed by the company since 2004.

Why aren't there effective systems in-place in law firms, much like there are in public companies, to identify signs of fraud and other funny monetary business? Is it that the code of a professional services entity like a law firm is to not spy on each other's financial transactions?  But lawyers, of all people, should be aware of the dark side of human nature.  How is it that too many lawyers "borrow" from client funds?  This crime is so common that it has been part of the plot line on "The Good Wife."

" ... our internal rate of change has to be greater than the external rate of change," Paul Raines, GameStop CEO

In THE WALL STREET JOURNAL, GameStop's Chief Executive Officer Paul Raines is quoted observing, " ... our (electronic industry's) internal rate of change has to be greater than the external rate of change."  The article by Ann Zimmerman focuses on how the brick and mortar consumer electronics store might be able to survive.  But the challenges the industry faces mirror those of the legal sector. 

The official report from Citi Private Bank's Law Firm Group and the Hildebrandt Institute indicate that 2012 could be as tough as 2009.  Layoffs could became routine again.   Recently David Lat at Abovethelaw.com received word from sources at Winston & Strawn that there were stealth layoffs and low hiring of summers at the Chicago office.  Layoffs of associates in litigation could hit W&S's New York office in the fall.

Yet, the legal and the business media are not reporting an upheaval in how law firms operate.  That's what is alarming.  Retail in general, not only for consumer electronics, is experimenting with every aspect of how things used to be done.  Because of that process some stores such as Macy's and Wal-Mart are doing fine.  A few years ago there were those who had written off retail.

If the legal sector doesn't have its Come To Jesus moment, the layoffs will resume in volume.  When searching for a position, lawyers who have choices should analyze the business model.  If it is old-line, that might not be the place to be.

Reddit: Maybe only a lawyer would have known how to upstage a bunch of smug very rich people

The rich conservatives in Tampa looked like yesterday's generation as the youthful incumbent in the White House got on Reddit and submitted to Ask Me Anything (AMA). 

The questions submitted, the ones Boyish Barack selected, and the answers he gave riveted us - of all generations.   Maybe only a cagey lawyer would know how to do this.  Businesspeople (including lawyers who go over to the other side to make big money) usually are too focused on gaining, protecting, and growing wealth to think out of the box as the president did.

Elie Mystal of Abovethelaw.com didn't find Obama's answer to the law school debt satisfactory but being on Reddit was not about providing solid answers. It was about showing off and upstaging the other party.  It was Bill Clinton playing the sax on national TV.  Clinton, as we recall, won that election. 

The lesson here might be don't send a businessman to do a politico's job.  We now wonder what stunts Obama will stage at the DNC.   A good time will be had by all. 

Happy Lawyer = Any Lawyer With A Job

Any lawyer who has a job has to be happy.  The legal sector has become binary: Those with jobs, those without jobs. Therefore, it was no surprise that THE AMERICAN LAWYER survey found associates the happiest they have been in a long time. 

After all, the survey was among JDs who were employed, not the suicidal broke angst-ridden about student loans Millennial sitting in Starbucks contemplating the void.  Any survey among the latter will, I have a hunch, find that they are not happy. 

 

Alleged Major Harvard Undergrad Cheating Scandal Makes Business Media: Ghost of Gupta

Among others in the business media, BLOOMBERG and THE WALL STREET JOURNAL are covering the allegation that about 125 Harvard undergraduates in a class of 250 cheated on an exam. 

If the allegation is proven, they could be bounced out of school for a year.  How much longer than that the stigma would follow them is an unknown.  Political enemies of the late Ted Kennedy never forgot that he paid someone to take his exam at Harvard.

The question is: Why is this making the business pages?

The test was a take-home exam so the nature of cheating took the form of consulting with each other on what should have been independent work.  The question is, of course, why is this making the business pages?  After all these are undergraduates, not MBA students at Harvard Business School.   Or even students at Harvard Law, who would be advising the captains of industry soon enough.

Too simple an answer is that it's Harvard.  Ordinarily an issue like this would make the front page of general establishment daily media like THE NEW YORK TIMES and then be pursued in much more depth in glitzy monthlies like VANITY FAIR.  

A more intuitive answer, I am convinced, is that this business focus is directly related to the enigma of how once pillar of the establishment Rajat Gupta could cavort with the thugs at Galleon Hedge Fund.  Incidentally Gupta, just like former Enron  Chief Executive Officer Jeff Skilling now in the slammer, graduated from Harvard Business School.  Gupta will be sentenced in mid October and faces a maximum of 25 years on all convictions.

If the allegation is proved, where did the 125 get the message that it was okay not to do your own work?

That Harvard undergraduates, who have such a rosy professional path ahead of them, would possibly cheat raises the uncomfortable concern if unethical behavior is the way of the world in the establishment.  Surely, the 125 had to get the message somewhere that not doing your own work is okay.  Where that message comes from will be the subject for many opinion-editorials.   

Tom Crone Arrested: Former legal manager for NEWS OF THE WORLD

Was this a situation in which the fox was guarding the hen house? 

Over in London, AP reports that Tom Crone has been arrested on suspicion of phone hacking and privacy violations.  He is former legal manager for the now-gone NEWS OF THE WORLD.

Chris Christie, Former Practicing Attorney, Loses Big One in Court of Public Opinion

Conservative and former New York Mayor Rudy Giuliani rides to the rescue. 

Here, as POLITICO reports, he takes on liberal media which declared New Jersey Governor  Chris Christie's RNC keynote speech a 'flop."  Instead Giuliani describes it as "measured" and "philosophical," code that the flamboyant iconoclast can be statesmanlike.  Giuliani knows his rhetorical game.  He has rebranded Christie as potential presidential material.

However the NJ Governor has treated the media with disrespect, and in public.  When that happens, the media will not forget.  No question Christie has become a target.  This is analogous to when a specific law firm, law school, or individual becomes a target for the wildly popular media property Abovethelaw.com. No one can resist the entertainment value of witnessing an entity bashed.  As Joseph Epstein hammers in his book "Gossip," much of journalism has always been positioned and packaged as bread and circuses, with juicy tidbits of negative information thrown in.  For instance, on ATL, New York attorney James Doyle is featured for DUIs and cavorting with a prostitute.  A good time is being had by all.

A speechwriter, I assessed Christie's keynoter as a paradigm shift to a presence on the national stage.  He hit on hard values like respect versus soft (Democratic) values like popularity.  On that platform he could move forward to a campaign for the White House in 2016.  But will the media allow that?  It may shut him down just as it seems to be shutting down one-time phenomenon Sarah Palin.   Even the conservative media have declared her over.  GOP-dominated Fox News canceled interviews with her. That was after she wasn't invited to the GOP. 

The media giveth and the media taketh away.  In response, Christi can do what the private sector is doing.  That is, it is establishing its own content or brand houses.  Instead of waiting for the external media to cover it, it provides its own online video including B-roll and interviews, photos, speeches, press releases, earnings reports, announcements, legal documents which are public, white papers, opinions, advertising, and real time interaction with constituencies in its "Media Center."  That Media Center is embedded on its website.

Of course, any law firm, lawyer, or law student can also set up a Media Center.  Attention gets attention.  The external media might swing by to check out what's happening and cover it.

Cheer Up, Debt-Heavy Lawyers: Older generations didn't do so hot either

Many young lawyers and JDs who never got a crack at practicing law might feel foolish for being debt-heavy.  They might finger attending law school as an unwise financial decision.   Well, they can feel somewhat better about things.

The National Bureau of Economic Research issued a report.  Here you will read that 46% of Americans die with less than $10,000 in assets.  That means that the financial decisions they made weren't so hot either.

Loose Lips Sink Careers: David Chalian caught on hot mike

There's no deleting what was heard over a hot mike, at least not in an era when most of media coverage is gotcha.  So this is the end of the road for Yahoo Washington Chief David Chalian, reports POLITICO.

Chalian's off the record remark which turned up on the record was a quip that the Romneys didn't seem to care about the possibility that African-Americans would perish in Issac.  Yahoo axed him and he did a mea culpa.

Perhaps some liberal media property will pick him up.  Pain tends to get one's attention.  So Chalian has probably gotten down cold the lesson a good lawyer would have advised him on: Loose lips sink careers. Always be circumspect. 

Cardinal Dolan To Offer Closing Prayer at DNC, Just Like RNC: He's suing ObamaCare

Cardinal Timothy Dolan will be offering up the closing prayer at the Republican National Convention.  We knew that.  Now we find out from THE WALL STREET JOURNAL that he will be doing the same thing next week at the Democratic National Convention.  That's despite the reality that the New York Archdiocese is among those suing ObamaCare for mandating reimbursement for birth control.  Also, the Catholic Church isn't too hot on abortion.

Politics makes strange bedfellows.  Next week we will be monitoring coverage for reports of any tensions between this man of the cloth and liberals attending the DNC.  Given the scandals surrounding the Catholic Church right now, the reception he gets could be chilly or worse.