Posts on ‘October 6th, 2009’

A federal appeals court has set a high bar for foreign plaintiffs attempting to use U.S. courts to hold foreign defendants accountable for human rights violations in foreign lands, ruling that liability can be imposed only where it is shown that a defendant “purposefully” aided and abetted a violation of international law. In a major decision Friday, the 2nd Circuit clarified the standard for aiding-and-abetting and conspiracy liability under the Alien Tort Statute.

The worst economic downturn since the Great Depression has hit law firms hard. Big firms are hurting, with profit margins squeezed by sagging demand and record-high expenses. The result: the now familiar litany of mass layoffs, salary freezes and cuts, deferred start dates for first-year associates, and canceled or downsized summer programs. The $160,000 question now is, what happens when the economy recovers? Will things go back to how they were? The answer, according to law firm and law school leaders, is no.

There’s no denying that collections have been a challenging, sometimes uncomfortable, situation during the recession as clients find it more difficult to pay and law firms are all the more eager to get the money they are owed into their coffers. With varying motivations and frequency, some law firms have said “enough is enough,” and are taking their delinquent clients to court in hopes of forcing payment.

If an independent prosecutor has his way, leading plaintiffs lawyer Thomas Girardi would face an admonishment, but no suspension, for signing fraudulent appellate briefs in connection with his representation of Nicaraguan banana workers in a pesticide exposure case. Girardi’s problems began when a Central American legal team mistakenly filed a complaint against Dole Food Corp. — which doesn’t exist — instead of Dole Food Co. They then secured a $489 million judgment against the wrong corporate entity.

A report in the Miami Herald asks whether several current and former Greenberg Traurig partners helped R. Allen Stanford in running his alleged $7 billion Ponzi scheme. According to the article, lawyers from the firm helped Stanford set up a special trust in the late ’90s in Miami that allowed millions in assets to be moved offshore without making disclosures to the federal government. Stanford also turned to Greenberg lawyers to draft changes to the Caribbean island’s banking system, the report says.

The days of phony online reviews and bogus testimonials are officially over — or at least the Federal Trade Commission hopes so. The FTC on Monday published its long-anticipated final guidelines laying out how companies can use consumer testimonials and celebrity endorsements to promote their products and services, both in the online and offline worlds. The guidelines had not been updated since 1980.

A federal appeals court has upheld the prison sentences of John J. Rigas and Timothy Rigas in the massive corporate fraud at Adelphia Communications. The 2nd U.S. Circuit Court of Appeals said Monday that Southern District of New York Judge Leonard B. Sand acted well within his discretion in sentencing John J. Rigas to 12 years in prison and his son, Timothy, to 17 years.

Supreme Court Justice Sonia Sotomayor lived up to her billing as a forceful questioner Monday as the Court opened its fall term with two oral arguments and an order list disposing of hundreds of cases that piled up on its doorstep over the summer. Unlike some new justices who start off asking few, if any, questions, Sotomayor was a frequent interrogator, often formulating her queries as declarative statements about an aspect of the case, followed by the question, “Correct?”

Bingham McCutchen has joined the ranks of firms that are tweaking their compensation systems, saying Monday it is moving to a “merit lockstep” system that will keep base pay on lockstep but introduce a merit component into bonuses. A memo first reported on the blog Above the Law said that while the firm is not abandoning lockstep, it is “keenly aware of current marketplace conditions” and believes that “to maintain our continued success, we need to incorporate a merit component into our overall lockstep structure.”

Robert Clifford, a well-known personal injury lawyer in Chicago, warns that Illinois lawyers won’t be able to speak to the press about their own cases if an appellate decision against him is allowed to stand. Clifford is being sued for defamation over a press release his firm issued in another case. In a petition to the Illinois Supreme Court, he asks the court to overturn the August appellate ruling based on his fair report privilege to discuss a public court filing without being liable for defamation.