Posts on ‘March 17th, 2009’

Abandon all hope, ye who seek to overturn an arbitration award, because the 5th U.S. Circuit Court of Appeals has ruled that manifest disregard of the law by arbitrators is no longer a ground for vacatur under the Federal Arbitration Act. The 5th Circuit’s decision in will make parties think twice — or three times — before agreeing to submit to arbitration to settle their cases.

Political scientist Helen Knowles thinks Supreme Court Justice Anthony Kennedy has gotten a bad rap as a “flip-flopper” and somewhat unpredictable swing vote. “He is much more consistent than people give him credit for,” she says. Knowles turned that thought into a new book, “The Tie Goes to Freedom: Justice Anthony M. Kennedy on Liberty,” touted as the first full-length treatment of Kennedy’s jurisprudence. Did Knowles interview Kennedy for the book? Apparently the justice was too busy, or too reluctant.

Talk about a stinging defeat. A federal judge in Washington, D.C., on Friday dismissed a lawsuit brought by naval police officers who wanted to stop the Navy from blasting recruits’ eyes with pepper spray during their training. The officers argued that the practice was dangerous and deprived them of their constitutional rights to due process and equal protection. The judge found that the officers failed to show that the Navy had acted arbitrarily and capriciously in designing its training program.

The Massachusetts Supreme Judicial Court ruled Monday that Massachusetts smokers can use a consumer protection law to sue Philip Morris Inc. for the way it marketed Marlboro Lights. The ruling — which closely mirrors a decision from the U.S. Supreme Court in December that smokers may use state consumer protection laws to sue cigarette makers for the way they promote “light” and “low tar” brands — means a class action lawsuit brought by smokers who claim deceptive marketing can move forward.

A federal bad-faith bank fee suit filed against Wachovia joins similar suits pending across the U.S. against Wachovia as well as Bank of America and Wells Fargo, accusing the banks of deceptive practices intended to maximize profits at the expense of customers and challenging bank policies governing the assessment of overdraft fees. Last year, Bank of America set aside $35 million to settle a California suit with bank customers who claimed the bank posted debit transactions to accounts in high-to-low order.

In the first ruling of its kind, a bankruptcy judge held that the city of Vallejo, Calif., has the authority to void its existing union contracts in its effort to reorganize, saying public workers do not have the same protections as union workers at private companies. Municipal bankruptcy is so rare that no judge had yet ruled on whether Congressional reforms in the 1990s that required companies to provide worker protections before attempting to dissolve union contracts also applied to public workers’ contracts.

Defense attorneys for Tom Petters, who is accused of running a $3.5 billion Ponzi scheme, are seeking court permission to quit. The lawyers accuse the government of meddling in the Wayzata, Minn., businessman’s defense by objecting to payment of their fees from Petters’ frozen assets. In court filings Monday, they say they haven’t been paid in nearly three months.

Jeffrey Bleich, a partner at Munger, Tolles & Olson, has been asked to become special counsel to President Obama. In that role, Bleich, former California co-chairman of the Obama for America campaign, will be tasked with providing legal advice and counsel to the Office of the President. Beginning on March 23, Bleich will join the Obama administration on an interim basis for three or four months.

A judge on Wednesday ordered the appointment of a receiver to defunct IP shop Morgan & Finnegan and enjoined it from selling or transferring its assets after the failed New York firm found itself the target of a lawsuit from lender JPMorgan Chase. JPMorgan had filed suit against Morgan in New York Supreme Court, claiming the firm defaulted on its loan agreement and owed the bank more than $4 million. The firm dissolved last month after Locke Lord Bissell & Liddell agreed to hire more than 30 of its lawyers.

It’s a new year, and there’s a new administration in Washington, which means there’s plenty of opportunity for challenges to your company’s employment practices. Attorney Lynne C. Hermle offers some ideas to help you avoid employment claims, including what to do if you’re plagued with downsizing, getting up to speed with the new administration, remaining vigilant about wage-and-hour issues and understanding your obligations to the troops.