Tuesday, July 31, 2001
Ritalin Class Actions: Fast Start, Big Stumble
The National Law Journal -- July 30, 2001
Public debate over Ritalin is robust, but class actions against the drug's manufacturer are not. Judges threw out two of five class actions filed last year against Novartis Pharmaceuticals Corp., the drug's manufacturer. The cases charge the American Psychiatric Association and Novartis of colluding to endorse a too-broad definition of attention deficit disorder. John Coale and Richard Scruggs, veterans of the tobacco wars, say they've only begun the Ritalin fight.
Read more . . .
Survey Shows Law Firm Hiring Up
The Legal Intelligencer -- July 31, 2001
Despite a sluggish economy and a slowdown in hiring, law firms and corporate legal departments have no plans to cease hiring, two national surveys report. The surveys indicate that the great majority of firms have continued to add attorneys, project assistants, paralegals, and receptionists, many on a temporary basis, with the intent to hire them full time if the economy picks up.
Read more . . . [waiting for hyper-link to become active]
Companies' Patent Inventories are Fueling Patent Enforcement Litigation
The Recorder -- July 31, 2001
Patent enforcement has grown into a multibillion dollar shadow industry that is transforming America's patent system from a security fence protecting inventors from exploitation into a money-minting machine for a few patent holders. Powered by a small -- yet aggressive -- army of lawyers, enforcers hammer companies with infringement claims, using the simple and effective power of financial threat to persuade companies to settle.
Read more . . .
Thursday, July 26, 2001
LeClair Ryan Now National Counsel in Wireless EMF Cases for AT&T
LeClair Ryan's Mass Tort Defense Team -- Bob Redmond, Bill Belt, Clem Carter and Paul Gill -- have been retained to serve as National Coordinating Counsel for AT&T Wireless in mass tort litigation related to electromagnetic field radiation (a.k.a. cell phone litigation).
The LeClair Ryan Mass Tort Defense Team currently serves as National Coordinating Counsel for Owens & Minor, a Fortune 500 medical product company, in latex glove litigation. The Mass Tort Defense team has served as National Coordinating Counsel since November 1997 and, in that capacity, has defended the company in more than 180 cases in all phases of litigation from the initial pleading phase, through discovery to trial.
After Tobacco?
Masters of high-stakes cases weigh in with views on strategy and logistics, from pretrial motions to high press visibility
The National Law Journal -- July 26, 2001
The National Law Journal invited seven top plaintiffs' and defendants' lawyers from around the country to address questions of strategy and logistics in today's bet-the-company litigation. Panelists are experienced advocates in the realm of bet-the-company lawsuits.
SUMMARY OF PREDICTIONS:
Intellectual property litigation: Litigation is most often a fight over property and the most valuable property in the new economy is intellectual property.
Employment Disputes in Financial Industry: Civil rights lawyers still have a great deal of work to do in the financial industry on behalf of women and minorities. The many years of mandatory arbitration, which prevented public scrutiny of the industry's endemic discriminatory practices, coupled with its historic biases against women and minorities, have resulted in an industry where attitudes are slow to change. Although we do see change, the industry needs continued prodding from the civil rights bar to make the industry one where women and minorities have the same opportunities as white males.
Employment and Environmental Claims Using Private AG Provisions: More litigation in the future directed toward major corporations in the area of employment and environmental claims. Many plaintiffs' lawyers are taking a look at the "private Attorney General's provisions" of many employment and environmental federal statutes and realizing that there are major opportunities to develop cases pursuant to these seldom-used federal statutes. As the bulk of the baby boomers move through the system, . . . anticipate seeing a dramatic increase in age discrimination litigation. Additionally, our old "demons" in the areas of race and sex discrimination will raise their heads again. Also, look for escalation in Clean Water, Clean Air [suits] and actions brought pursuant to the Resource and Recovery Act over the next decade.
Antitrust and Consumer Fraud Litigation: The state attorneys general have been increasingly coordinating their efforts in recent years, and [expect that to] continue, particularly in the areas of antitrust enforcement and consumer fraud. Even so, the state AGs -- and the federal enforcement agencies, for that matter -- with their limited resources, are able only to scratch the tip of the iceberg when it comes to prosecuting wrongdoing. That's why private enforcement is so important [and will increase].
Plaintiff Bar in Alliances with State Attorneys General: The more fundamental change we are facing in [high-stakes] litigation . . . is found in the largely unregulated and secret alliances between the plaintiffs' bar and state attorneys general.. . . But these arrangements are with us now for good, thereby delegating to these contingency lawyers a fair degree of say into the setting of the public policy agenda, with little or no oversight or control from the traditional means of state governments, so long as the attorney general promises to give them an acceptable percentage of what they can squeeze out of a defendant's business.
BIGGEST MISTAKE: Defense lawyers rely too much on pre-trial motions and fail to prepare for trial.
Read more . . .
Expert Not Strictly Limited to Four Corners of Report
Shannon P. Duffy -- The Legal Intelligencer -- July 26, 2001
An expert witness's testimony can go beyond the contents of his report as long as his conclusions are consistent with the report and don't add any new theories that would unfairly "surprise" the other side, a federal judge has ruled.
In his 14-page opinion in Bowersfield v. Suzuki Motor Corp., Judge Jan E. DuBois of the U.S. District Court for the Eastern District of Pennsylvania rejected objections from defense lawyers who said the plaintiff's expert on vehicle crashworthiness was improperly expanding on his opinions during a pretrial hearing.
DuBois ruled that Alan Cantor's testimony "should not be limited to what is set forth in his report" because the conclusions he reached during the pretrial Daubert hearing simply "expanded on the details of his methodology and the bases for his opinions."
And any prejudice to defendants can be cured, DuBois said, by allowing the defense to take Cantor's deposition and supplement their own expert reports.
Read more . . .
Wednesday, July 25, 2001
Frito-Lay Moves to Seal Documents
Jay Lindsay -- Associated Press Writer -- Sunday, July 22, 2001; 7:18 PM
The Associated Press is reporting that snack food giant Frito-Lay is seeking to permanently seal court documents that show pretzels and chips were tainted with toxins, including substances similar to kerosene and cleaning solvents.
Read more . . .
Preparing for lawsuits is the best way to avoid them
John Tucker -- July 20, 2001 -- The Business Journal (Jacksonville and Northeast Florida)
New York State is First to Adopt Official Multi-Disciplinary Rules
John Caher -- New York Law Journal -- July 25, 2001
New York this week became the first state in the country to directly address regulation of the multidisciplinary practice of law, when the state's Appellate Divisions adopted several new provisions governing cooperative business relationships between lawyers and nonlawyers.
The new rules, which take effect Nov. 1, allow for limited, strictly regulated business alliances between attorneys and nonattorneys and are constructed around two basic precepts: preservation of the core values of the legal profession and the best interests of the client.
While recognizing that strategic ventures are here to stay, the Administrative Board of the Courts adopted an approach that leaves lawyers firmly and solely responsible for legal work, and categorically prohibits any interference by nonlawyers in the root values underlying the attorney-client relationship.
• Disciplinary Rule 1-106, a new rule, makes clear that nonlawyers cannot direct or regulate the professional judgment of lawyers in rendering legal services or take any action that would compromise an attorney's ability to protect client confidences. It explains the circumstances under which the Code of Professional Responsibility applies to a lawyer or law firms providing nonlegal services.
• Disciplinary Rule 1-107: The new disciplinary rule is akin to a statement of philosophy that discusses and reiterates the necessity of preserving core values. It goes on to impose specific limitations on contractual relationships between lawyers and nonlawyers. Under DR 1-107, nonlegal professionals may not have any ownership or investment interest in a law practice or have any managerial or supervisory power over the practice; contractual relationships can be entered only with certain professions -- a list will be forthcoming -- approved by the Appellate Divisions; lawyers and nonlawyers may not share legal fees; lawyers are prohibited from giving any financial or other tangible benefit for giving or receiving referrals to or from nonlawyers; lawyers must disclose the existence of a contractual relationship to any client to whom nonlegal services are provided.
• Part 1205 of the Joint Appellate Division Rules: This requires lawyers to provide clients with a "Statement of Client's Rights in Cooperative Business Arrangements." The statement, which must be signed by the client, explains in detail the client's rights in connection with the lawyer-nonlawyer relationship. "Multi-disciplinary practice between lawyers and nonlawyers is incompatible with the core values of the legal profession and therefore a strict division between services provided by lawyers and those provided by nonlawyers is essential to protect those values," the new rule states.
The debate over MDP was triggered by some alliances or attempted affiliations between lawyers and major accounting firms. It ignited with full force nearly two years ago, when the American Bar Association floated a proposal that would have largely dismantled the traditional wall of separation between attorney and nonattorney ventures.
In response to the ABA proposal, the New York State Bar Association's Special Committee on the Law Governing Firm Structure and Operation drafted an extraordinary 388-page report.
The report, "Preserving the Core Values of the American Legal Profession," often called the "MacCrate Report" in recognition of committee chairman Robert MacCrate, called for a far more measured and temperate approach than the one under consideration by the ABA. Largely because of the MacCrate Report and the discussion it generated, the ABA essentially abandoned its initial stance and rejected the proposal backed by large accounting partnerships, corporate counsel organizations and the U.S. Chamber of Commerce. (Download a copy of the MacCrate Report.)
Last July, the ABA's House of Delegates adopted, by a 3-1 margin, a resolution recommending that every state revisit and revise rules governing relationships between lawyers and nonlegal professionals. This week, New York became the first state to do so.
Read more . . .
Tuesday, July 24, 2001
Some Big Firms Cutting Expenses While Others Remain Unfazed
Krysten Crawford - The American Lawyer - July 24, 2001
Despite profit drops last year, and cost-cutting by top clients some firms are unfazed and going about business as usual but the situation varies.
WHERE THE MONEY GOES
Expenses as a percentage of revenue for the typical Am Law 100 firm:
Net Income: 32%
Legal Staff: 28%
Other Staff: 17%
Real Estate: 8%
MIS: 4%
Marketing: 4%
Liability Insurance: 1%
All Other: 6% percent
Source: Hildebrandt International
Read more. . .
$100,000 awarded in cybersquatting case
Las Vegas Sun - July 20, 2001
A federal judge has awarded more than $100,000 in damages to the Bellagio resort and ordered a California company to stop using its name. The resort filed a lawsuit to stop Allen Computers, Downey, Calif., and its owner, Mark Denhammer from infringing its Bellagio trademark and violating the Anti-Cybersquatting and Consumer Protection Act.
Read more. . .
Raleigh man suing OxyContin makers - Beaver resident claims that he was harmed by drug
The Associated Press - July 21, 2001
BECKLEY -- A Raleigh County man has sued the makers of the OxyContin for manufacturing and distributing the "dangerous and defective" painkiller that has caused him addiction, mental and physical pain and suffering. Chris Umberger of Beaver alleges in his lawsuit that Purdue Pharma L.P. put oxycodone in the medication even though it knew that ingredient was one of the most dangerous and abused drugs in the United States. He also accused the Stamford, Conn.-based company of manufacturing the pills in "dangerously high and deadly doses."
Read more. . .
Florida Court Gives Green Light to Class Action Against AutoNation
Susan R. Miller - Miami Daily Business Review - July 19, 2001
A lawsuit alleging that AutoNation deceived people who bought used cars from its now-defunct megastores can go forward as a class action, Florida's 4th District Court of Appeal ruled Wednesday. The suit, filed in Palm Beach Circuit Court in August 1999, was given class action status last October. It alleged Fort Lauderdale, Fla.-based AutoNation Inc. duped car buyers by first assuring them that they had been unconditionally approved for financing, only to tell them, once they drove their vehicles off the lot, that they had not been approved. Though buyers were given written contracts, AutoNation never signed them, allege those who filed the suit. AutoNation allegedly then forced buyers to sign new deals with less favorable terms or alternatively turn back in their cars, according to court documents.
Read more . . .
Wednesday, July 18, 2001
As Growth Slows, Will Partners Feel the Pain? - Law firms' debt on the rise, Citigroup survey discovers
Otis Bilodeau - Legal Times - July 18, 2001
As this year's economic drought stretches into midsummer, the technology sector and the IPO market have withered to husks and cash-strapped clients are shuffling law firm bills to the bottom of their in-boxes. "Corporate work has dried up, there's no doubt about it," says the managing partner at one of Washington, D.C.'s largest firms.
The cash flows couldn't be thinning at a worse time. Many firms in the past few years, riding the economic boom, expanded aggressively -- opening new offices, building out more space, acquiring firms, poaching squads of laterals, all the while handing out larger-than-ever paychecks to associates. And, to finance it all, a number of these firms took on significantly more debt, according to a recent study conducted by Citigroup, the leading lender to U.S. law firms.
The study, which Citigroup has not released to the public, plots debt, income, and capital levels over the last three years at the bank's 10 largest law firm clients. All are among the country's 50 highest-grossing firms, and "almost all" are either based in or have substantial offices in the D.C. area.
Read more. . .
Perkins Coie Beefs Up IP Presence in San Francisco Bay Area
Brenda Sandburg - The Recorder - July 18, 2001
Perkins Coie has established a patent prosecution practice in its Menlo Park, Calif. office with the acquisition of Iota Pi Law Group and three associates from Wilson, Sonsini, Goodrich & Rosati. Iota Pi, which in Greek spells IP, joined Perkins on July 1. The patent prosecution boutique includes partner Peter Dehlinger, associate Linda Rabin Judge and four patent agents. Prior to the merger, Perkins Coie's patent prosecution practice was limited to its Seattle headquarters, plus a couple of attorneys in its Denver office. The 540-attorney firm now has 25 patent prosecutors and more than 80 intellectual property attorneys. Iota Pi's clients include Aclara BioSciences Inc., Alza Corp., Chiron Corp., Stanford University, University of California and Varian Associates.
Read more. . .
Tuesday, July 10, 2001
Pemstar (Rochester, MN) Appoints General Counsel
The Business Journal -- July 6, 2001
Pemstar Inc., Rochester, announced the appointment Friday of Linda Feuss as vice president and general counsel. She came from Pillsbury in Minneapolis where she held the same positions for the bakeries and food service business and was responsible for information technology and operations.
PPD appoints Former Spilman Thomas (Charleston, WV) Attorney as General Counsel
The Business Journal -- July 9, 2001
Wilmington-based PPD Inc., a pharmaceutical and biotechnology company that has two development facilities in the Research Triangle Park (NC), announced today the appointment of B. Judd Hartman as general counsel.
Hartman, 38, comes to PPD from Anker Energy Corporation in Morgantown, W.Va., where he served as vice president of legal affairs. In that role, Hartman directed the company's mergers and acquisitions activities while also administering its credit facilities. Other responsibilities included Securities and Exchange Commission reporting and compliance, corporate governance and overseeing the company's land department.
Prior to joining Anker Energy, Hartman was a partner with the Spilman Thomas & Battle law firm in Charleston, W.Va., where he specialized in joint ventures, mergers and acquisitions, commercial lending and business planning.
"Mr. Hartman brings a wealth of experience, particularly in the joint venture and acquisition arenas, that should prove very valuable to PPD as we continue to grow our business to meet client needs," said Fred Eshelman, chief executive officer of PPD. "We are pleased to have a professional of his caliber join our legal team."
Monday, July 09, 2001
Business Trends in the Legal Profession
Jeff Blumenthal -- The Legal Intelligencer -- July 10, 2001
There has been so much change in the legal market over the past six months that legal consultant Robert Denney couldn't wait until the end of the year to issue his annual "What's Hot and What's Not in the Legal Profession" report.
Red hot: intellectual property, technology, entertainment, and labor and employment.
Getting Hot: restaurant trademark applications; labor and employment work fueled by increased unionization efforts; bankruptcies; international arbitration.
Cool: mergers and acquisitions; venture capital and corporate finance.
Emerging: Toxic mold; gay law.
Organizationally: multi-tier partnerships; performance-based associate salaries.
Client-side: dumping low margin clients
Read more . . .
Snell Partner Joins Pinnacle West Capital Corp.
Snell & Wilmer partner Steven Wheeler has decided to join the company for which he has served as outside counsel for 20 years. Wheeler, a partner in the firm's Phoenix office, has become a senior vice president at Pinnacle West Capital Corp., a Phoenix-based energy provider with consolidated assets of $7 billion. Wheeler will direct the matters of transmission operations, regulation and planning.
Friday, July 06, 2001
Whether You Call it Blood-letting or "De-Equitizing," It Amounts to the Same Thing -- There Are "partners" and There are "PARTNERS"
2000 was another good year for the Largest 100 Law Firms, but it may be the last they'll see for a while.
Firm Acquisitions Grow Revenue But Not Always "Per Partner Profits"
In 2000, gross revenue among The Am Law 100 rose an average of 19.5 percent, and profits per partner grew an average of 10.2 percent (see chart). Yet even last year some firms were already cresting the summit for the glide down, with exploding associate costs eating into partnership profits. Partners at firms that didn't achieve double-digit revenue growth last year generally saw their take stay flat or fall.
Ever resourceful, many firms are engineering a way out of this trap. In the process they have coined a new word for the American business lexicon -- "de-equitization." In firm after firm on the Am Law 100 charts, healthy growth in revenue was paired with a healthy decline in the number of partners showing up for those Saturday morning get-togethers. See chart.
There is no mistaking that the increasing number of big-firm mergers is part of an overall trend toward gigantism among American lawyers. In 1995 the number of Am Law 100 firms with more than 500 lawyers was 17. Last year it was 45. But in a weakening economy, increased size and leverage can rapidly become an albatross, dragging down performance and profits. "The final effect will probably be known in the July-this-year-to-July-next-year period," says Cooley Godward managing partner Lee Benton. "We are all committed to fairly large classes. If you get 50 more heads to feed and you don't increase business -- " Benton dismisses the thought even before he can complete it. "It's hard to believe you won't get a turnaround in that time."
Read more . . .
OPINION: Get ready for more firm spin-offs, increasing price competition and increasing difficulty maintaining per partner profits, as portable business continues to walk, unhealthy mergers rock apart and new start-ups, with better automated offices and lower cost structures, compete more aggressively for share in a saturated market.
Mergers & Acquisitions Slow
After years of too much work, firms see big slump in mergers and acquisitions
Renee Deger -- The Recorder -- July 6, 2001
The mergers and acquisitions pace this year is so slow compared to recent years that Silicon Valley firms will be lucky to score a fraction of the business they did in prior years. With the stock market and the economy limping along, gone are the deal backlogs, the lavish deal-closing parties, and the endless supply of acquisition capital companies used to do deals.
Read more . . .
Tuesday, July 03, 2001
Piracy Payback -- Dumped Workers Find Revenge
[Increase in calls to Business Software Alliance tied to downturn in economy and layoffs in the technology sector.]
Michelle Delio -- Wired News -- 2:00 a.m. July 3, 2001 PDT
[The Business Software Alliance is an international organization representing leading software and e-commerce developers in 65 countries around the world. Established in 1988, BSA has offices in the United States, Europe, and Asia. As the "voice" of the software industry, we help governments and consumers understand how software strengthens the economy, worker productivity and global development; and how its further expansion hinges on the successful fight against software piracy and Internet theft. BSA's efforts include educating computer users about software copyrights; advocating public policy that fosters innovation and expands trade opportunities; and fighting software piracy.]
Once a report comes in to BSA, BSA corroborates the information, usually by calling the software company whose programs have allegedly been pirated. The investigator asks the software company to check its database to see if registration information gibes with the report. If the initial investigation proves fruitful, BSA usually turns the case over to lawyers who try to settle out of court with the company.
But if a company refuses to cooperate, BSA can and will ask a federal judge to grant a court order allowing BSA investigators to visit the accused company unannounced and accompanied by local law enforcement officials such as U.S Marshals. BSA prefers this "bolt-from-the-blue" method, which allows BSA to perform its own audit to see exactly what software is installed on the company's network.
Read more . . .
Monday, July 02, 2001
Question: How Old Are Your Real Estate and Construction Lawyers?
Rob Speyer is 31 years old in charge of the New York operations of real estate powerhouse Tishman Speyer Properties. His sister, Valerie, 34, is in charge of the company's crown jewel, the Chrysler Building. [What is the age of their lawyers?]
Read more . . .
Law Firms Move from Transactional to Relationship Orientation
Two Baker & McKenzie intellectual-property law partners talk about their transition from transactional to relationship-oriented services. As we slowly emerge from the rubble of an unprecedented economic downturn, a major international law firm's intellectual property (IP) practice is changing the way it does business.
Read more . . .
Class Action Business Good (for Plaintiff Firms)
Boston-based Class Action Law Firm Merges with Two Others
Berman DeValerio & Pease LLP, a Boston-based class-action law firm that represents investors in shareholder lawsuits, has merged with Berman DeValerio Pease & Tabacco PC of San Francisco and Burt & Pucillo LLP of West Palm Beach, Fla., to create a coast-to-coast practice. The newly formed Berman DeValerio Pease Tabacco Burt & Pucillo will have 30 attorneys. Headquartered in Boston, the firm will specialize in prosecuting private class-action lawsuits in the securities fraud, anti-trust law and consumer fraud areas.
Is the U.S. Losing Battle for Forum of Choice in Patent Litigation? -- Japan's Rohm brings Patent Suit against Japan-based Nichia in, of all places, Japan!
7/2/01 5:34 PM -- Source: Reuters
TOKYO, July 3 (Reuters) - Japanese chip and components maker Rohm Co Ltd said on Tuesday that it had filed a lawsuit at the Kyoto District Court against Nichia Corp for allegedly infringing its patent for a blue light-emitting diodes (LEDs). Rohm, Japan's largest maker of custom-made LSIs (large scale integration chips), said it had obtained patents on the technology in Japan in 1999 and in the United States in 2000 and wanted Nichia to stop production and sales of blue LEDs. Blue LEDs, originally developed by University of California professor Shuji Nakamura, a former Nichia engineer, in 1993, are expected to be used in third generation mobile phones partly due to low electric power consumption. A Rohm spokesman said the company also was seeking 474 million yen ($3.82 million) as a compensation payment from Nichia, an unlisted Japanese semiconductor maker. In December last year, Japanese custom linear integrated circuit maker Rohm filed asuit in the United States, claiming Nichia and its U.S. unit Nichia America Corp violated its patents on blue LEDs.
Read more . . .
Nixon Peabody Merges With California's Lillick & Charles
Bruce Balestier - New York Law Journal - July 2, 2001
Nixon Peabody has expanded on the West Coast for the first time in a merger with Lillick & Charles, a 70-attorney firm based in San Francisco. The 500-lawyer Nixon Peabody, which was founded in Rochester, N.Y., has grown aggressively in its own time zone in recent years, with 10 branch offices along the East Coast. But co-managing partner Harry P. Trueheart III said Nixon Peabody had long been looking for a merger partner with an established presence in California. At Lillick & Charles, a 104-year-old firm with strengths in banking, commercial litigation and international trade, managing partner John M. Rosenthal echoed that notion, explaining that the need for national reach had become an imperative for his firm.
Read more. . .
