Law And More

Wealth Transfer - The Activist Attorney General

What was really going on during the Crusades - that is, the assaults on former lead paint manufacturers et al. by zealous state attorneys generals?  Something very capitalistic: The transfer of wealth. 

At stake were, are and will be billions, perhaps soon trillions, of dollars which are taken from businesses and, yes, taxpayers [think tobacco settlement] and handed over to plaintiff attorneys and political leaders.  That's the interpretation of the role of the activist state attorney general, presented by Hans Bader of the Competitive Enterprise Institute. 

Now that the most zealous of all and model for others Eliot Spitzer has been unmasked as not quite the pure and selfless fighter for truth and justice, the public, Congress, media, and other influentials might finally be ready to pierce the layers of populist rhetoric supporting this wealth transfer.  Incidentally, CEI lists the top 10 worst as:

• Richard Blumental, Connecticut - the mastermind behind the tobacco Master Settlement Agreement which transferred $14 billion from business and smokers to plaintiff attorneys.
• Bill Lockyer, California.
• Eliot Spitzer, New York.
• Zulima Farber, New Jersey.
• Patrick Lynch, Rhode Island [sound familiar].
• Darrell McGraw, West Virginia.
• William Sorrell, Vermont.
• Lisa Madigan, Illinois.
• Peg Lautenschlager, Wisconsin.
• Tom Reilly, Massachusetts.

The planets seem truly aligned for tort reform. Today, as the legal and political powers-that-be move in on Spitzer [even Andrew Cuomo's dad got in the act], the Federal Society sponsored a forum called "Reaching Too Far: The Role of the State Attorneys General."  Featured were attorneys general Bob McDonnell, Virginia, John Suthers, Colorado, J.B. Van Hollen, Wisconsin, and former Nebraska attorney general Don Stenberg. 

In his summary of the key points made at today's forum, Bader noted that the problem is now being recognized by these state attorneys general themselves who represent a push to reform.

Among the topics discussed, reports Bader, were:

• How trial lawyers and lobbyists "descend like vultures" at attorneys general conferences, post the tobacco Master Settlement Agreement.

 

• How contingency-fee arrangements between state attorneys general and trial lawyers "breed conflicts of interest and prevent settlements in the public interest."

• How, in Wisconsin, real law enforcement was neglected as activist attorney general Lautenschlager devoted the office's resources to "ideological causes and nuisance lawsuits against businesses like cranberry growers."

• How outmoded court rules "can turn a meritless lawsuit into a dangerous weapon, such as state rules restricting summary judgment."

 

• How the tobacco Master Settlement Agreement "imposes disproportionate burdens on certain states."  Examples include Colorado and Virginia.

Spitzer Unmasked might accelerate the reform being advocated by the presenters at the Federalist forum. But there are so many other public-interest issues that are emerging. They range from pesticides which a study in California found linked to autism to global warming. 

The public is scared.  Scared people, as we know from Germany post-World War I, are vulnerable to manipulation.  It's going to require user-friendly compelling outreach to demonstrate that the public interest is not the interest of activist state attorneys generals and the plaintiff bar.   

 

Hottie Fired by Wall Street Law Firm - Way Too Hot, Clients Claim

That's the kind of headlines we are going to read in the Law Blog of THE WALL STREET JOURNAL if the News Corp locks up the deal today.  Current head honcho on the Law Blog Peter Lattman will have to push the snarky envelope to sensationalism, preferably the sleazy kind.  That will raise the bar for all us legal writers. A good time should be had by all.

Loser-Pays Wouldn't Have Gone Down in Milwaukee

Those of us familiar with Alaska's old version of Loser-Pays in litigation probably thought that should have been applied in City of Milwaukee v. NL Industries.  That case, heavily weighted on the side of conspiracy, was so flimsy that it shouldn't have made it to trial.  But it did.  The defendant won.  And that defendant NL Industries most likely had to pony up hefty compensation to prominent defense lawyer Donald Scott.  So, Milwaukee should have paid the defendant's legal costs and that would have sent a message to other earnest parties intending to do justice their way.

But, with Alaska's new version of Loser-Pays those suing on the public's behalf are exempt from the rule.  As tort-reformer Walter Olson notes on PointofLaw.com, at the time the Alaska Supreme Court created this exception, the development "sounded noble."  [Beware noble intentions].  We all know what happened.  The noble rushed in with all sorts of lawsuits against business - with no consequences if they lost.

Is this sort of exemption giving a free pass to those with economic or political agendas to use the public interest to achieve their goals through the legal system?  Lead paint public nuisance litigation is all that and more since it's masking motives under the guise of championing lead-poisoned children.

Those Contingency Fees - Columbia Law Prof Michael Dorf Pushes Back

Those on the "other side" - that is, vigorous tort reformers - might be too committed to the party line to pay attention to what's being argued by those who might appear as the "opposition."  Not smart.

Take Columbia Law Professor Michael C. Dorf's point of view on those contingency agreements between government entities and private law firms.  As he stated in his July 10th post on DORF ON LAW, this "is a difficult policy question that depends on many factors, including the available resources for enforcement."  On Pointoflaw.com prominent tort reformer Walter Olson took on Dorf. 

Yesterday, Dorf pushed back.  In his "manifesto," this law professor reiterated his position that he advises approaching these arrangements as the complex matters they are vs. blanket condemnation.  In yesterday's post on DORF ON LAW, he says, "there may be good policy reasons to be skeptical about many of these contingent fee arrangements."  He also concedes that there is the "disturbing possibility that contingent fee lawyers in Rhode Island got no-bid business as a result of campaign contributions."  But these abuses don't necessarily make the option of a contingency arrangement a never-do.

If our arguments as tort reformers harden into spin and if we can't continue being alert to the sense in our seeming opposition's points of view, we are going to go the way of smug, arrogant, closed-system IBM in the late 1980s.  IBM turned inward.  We can't.

Lifting Limits on Pay Lawsuits - Knowing When To Hold & When To Fold

Tort reformers, each and every one of us, should salute the attempt by the House to override that stunning Supreme Court ruling which limits employees' ability to sue for pay discrimination within the first 180 days of employment. 

Look at it this way: Not doing so would only reinforce the plaintiff bar's populist cry that it's the only recourse for the little guy.  In this situation, it would be right.  The Supreme Court 5 to 4 ruling was such a contradiction of common sense and the Everyman/Everywoman intuitive feel about justice that tort reform would have suffered a severe setback.

Living The Virtual Life - It's All New Business

Big Law might not need to take on a virtual life to develop new business, at least not yet.  But we smaller players have been in that space long enough to have made that our primary marketing tool - and more. 

Among us, reports Peter Lattman on THE WALL STREET JOURNAL Law Blog, is Stevan Lieberman of boutique Greenberg & Liberman.  By establishing a virtual office on Second Life, Liberman has pulled in $20,000 in business in the past year.  And with no overhead.

That's the beauty of hustling on the Internet.  It's dirt cheap vs. paying to attend professional meetings where little fish like us usually don't return home with great contacts.  Forget new business.  And my new mantra is: I don't do lunch, dinner or breakfast, unless it's with a current client.  Going into reality to prospect is way too expensive with too long odds for small businesspeople. 

The lion's share of my new business - as well as business I can refer to the big fish for an eight-percent finder's fee - comes from the network I have built online.  On Friday, for the first time in four months, I will be venturing out of cyberspace into a real building on the Yale campus making a real-life sales call. As I keep enhancing my brandname, hopefully in-person prospecting will end completely.

Providence, RI - A Tale of Two Mayors

Buddy - that is, former mayor of Providence, Rhode Island Vincent A. Cianci, Jr. - is back in every way.  And that's not good news for the current Providence mayor David N. Cicilline.  The question on everyone's minds is if the city can hold both over-the-top personalities. 

Buddy announced Saturday, reports THE PROVIDENCE JOURNAL's Daniel Barbarisi, that he had wrapped up radio and TV deals.  That means that from those platforms he can re-assert his voodoo over the city. 

I fully expect Buddy to pontificate on the state's lead paint abatement plan which is due by September 15th and the upcoming appeals to the RI Supreme Court by both the lead paint defendants and plaintiffs.  Who knows, he may do more to influence public opinion on that matter than all the PROJO editorials and Attorney General Patrick Lynch press conferences ever did.  Even though Buddy has tamed his persona since his release from prison, he is unlikely to muzzle his colorful way of putting things. 

Cicilline, whom we met at the RI lead paint trial, is no slouch in charisma, charm, smarts and drive.  And his touch of the smart aleck is perfect for the city that could be morphing into the 2nd Provincetown [read gay, bohemian].  When the defense attorney at Lead Paint II asked Cicilline what the lawyer taking his deposition might have been thinking, the mayor answered he had no idea.

All of Providence is waiting for Buddy's first day on the air.  Will Cicilline, as some are advising him, push to be the first guest?  Or will he play cool and pretend the show is a non-event in Providence.  When I attended the Lynch ethics hearing last August, a talk-show radio host predicted that Buddy would bury any and all media competition in the region.

Lynch might fade from the limelight as the tale of the two mayors unfolds.

Contingency Fees Don't Violate Separation of Powers, Says Columbia Prof Michael C. Dorf

We lead-paint watchers are accustomed to hearing and repeating the conventional arguments against contingency arrangement between government entities and private law firms.  Maybe too accustomed.  That could be lulling us into a false sense of optimism that the contingency agreement in Rhode Island will be struck down by that state's Supreme Court and that even if the ruling is appealed in County of Santa Clara, et al. v Atlantic Richfield Co., et al. our position will triumph. 

Columbia Law Professor Michael C. Dorf aggressively argues against what has become the party line - the separation of power notion - in contingency battles.  In his blog Dorf on Law, Dorf states that contingency fee arrangements, for example, between state attorneys general and private lawyers do not violate the separation of powers. Period.

The standard argument, notes Dorf, is that such an agreement is wrong because "it vests executive power in private parties or because it appropriates funds [the private lawyers' cut of a successful verdict] without the express content of the legislature." Dorf censures this line of reasoning as weak. That's because, he goes on to explain, "The federal constitutional doctrine of separation of powers has no force in the states."  Those states which have separation of powers principles usually have those which are considerably weaker than those which apply on the federal level.

Dorf contends that is so because the tradition of contingency arrangements is even older than the United States of America.  Back then those private entities were called "relators" and they were able to file qui tam actions on the part of government entities.  The relators got a cut of the action. Those sorts of arrangements still go on today, for instance, to enforce the False Claims Act.

In addition, Dorf claims that contingency fees don't usurp the legislature's role in appropriating funds.  That would only be reality if the legislature itself passed a law prohibiting those kinds of agreements.

Instead of relying on the stock arguments, Dorf advises that this issue be approached as the complex one it is.  He observes, "Whether government should hire private lawyers working on contingent fees, and if so, on what terms, is a difficult policy question that depends on many factors, including other available resources for enforcement.

Readers can access Dorf on this topic of contingency fees here.

Big Law's Career Coach Down the Hall - Won't Catch Me Sharing

Why would well-trained lawyers, even though they're relatively young, trust the career coach down the hall, hired and paid for by their employer, Big Law?  And, even if we look at the trust issue as irrelevant as when we're in a pickle at work, would such a coach, who's a lawyer but has worked primarily in career counseling, be effective? 

That's the question posed by Amir Efrati on THE WALL STREET JOURNAL Law Blog today. The original post describes the career coach job which Diane Downs [Harvard Law '97] has held at Paul, Hastings, Janofsky & Walker since early this year.  Her previous job was associate dean of career planning and placement at Penn Law School.  Her employer claims it is a first.  Comments coming in from readers say no it's not a first.  They note that their firms have had that sort of function also.

Downs is there to assist in advising about such matters as what added skills might be needed, how to make partner, the implications of a performance review, and how to leave the firm.  These discussions proceed on a one-to-one basis and are confidential, says the article.

No surprise, a relatively large number of reader comments came in and they were mixed.  Some already had that kind of coach at their firm and saw the service as useful.  Others wished their firm had it or would like to be the career coach themselves, which seemed like a whole-easier gig than adding up billable hours. 

But many, like me, saw red flags.  If the firm really wants to help young lawyers help themselves, why not give them a stipend, like a medical benefit, to fund sessions with their career coach of choice. Capitalism, whether in corporate America where I worked full time or in Big Law, has never been sweet.  I have never experienced a reasonable employee being unguarded with the employer or baring their soul to an expert hired by the employer. 

There's more.  Not only do we distrust the in-house set-up as perhaps not in the confiders' best interests.  This woman is a career counselor, not a lawyer toiling in the trenches every day. 

Ask yourself: Where would your children get better advice about their current jobs in writing or media - from me who slugs it out every day here, economically, politically, emotionally and in terms of my craft - or from someone who specializes in career counseling at your children's firm, even if they had once upon a time obtained a degree in communications?

My hunch is this career coach function is a nice public-relations gesture that can be hyped for recruiting and retention purposes. After all, it's fashionable to have a coach.  This makes for a catchy story pitched to law schools as well as the media.  As we all know, the profession of law is in a crisis. [What profession isn't?] A piece of that agita in law is attracting and holding onto talent. A juicy read on the coming upheaval in Big Law is David Lat's article "Profits vs. Partners" in THE NEW YORK OBSERVER.

As one comment noted, a coach isn't going to solve the problem of those hellish hours which no longer stop when one makes partner.  Partners aren't skipping out the door at 6:00 P.M. any more either.  Associates see this and ponder their future. This Big Law & Its Discontents isn't new.  What's new is the intensity and pervasiveness of associates' dissatisfaction.  

Advice to Paul, Hastings, Janofsky & Walker: Ditch the in-house coaching, make the organizational culture more suited to a human being. A suggestion?  Reduce compensation [$160,000 to $300,000] so that you can bring on more warm bodies to work fewer hours.  For publicity purposes, introduce a benefit that pays 100-percent of 20 sessions with the coach of the associate's choice.    

Spitzer, Dann - The Media Giveth, The Media Taketh Away

Clearly there is now a media jinx on both Eliot Spitzer and Marc Dann, the Ohio Attorney General who was called the Next Spitzer by top-tier publications, ranging from THE NEW YORK TIMES to FORBES.  The two have morphed into almost cartoonish characters in the media.  Today, tabloid NEW YORK POST again has Spitzer on its front page.

The lesson here should register with all political leaders: The media are fickle.  What they giveth one day, they taketh away the next. Not long ago, Spitzer and Dann were media darlings, weren't they. So was RI AG Patrick Lynch who explained his mission to the media of bringing the former lead paint industry to justice.   During and after the Rhode Island Lead Paint Trial II, Lynch attempted to be even more accommodating, when he shouldn't have been.  His comments and disclosures were later ruled by RI courts to be out-of-bounds.  Lynch is appealing those convictions. 

In business, most leaders have already digested that tough lesson of maintaining a low media profile for themselves and re-focusing the media on their companies, the team, products and services.  It was through this self-effacing strategy that P&G's CEO A.G. Lafley brought the sleeping giant back to life.  Throughout the long ordeal of the lead paint public nuisance litigation, we're hearing plenty about Sherwin-Williams, its global expansion, its corporate social responsibility and proportionally not a great deal about its CEO Chris Connor.

Those who made it their "business" to be personally out there - think Carly Fiorina, William Ford, Jr., Robert Nardelli - also were forced out.  Everything, be it politics or business, is too complex in the 21st century to risk a personal high profile.  Feature what isn't you.