July 22, 2010 7:20 PM
The Contract Chronicles: Lance, Sergei, Kovy, Babby, Reggie, and the Rangers
Posted by Brian Baxter
Even before the steroids scandal began plaguing Major League Baseball in recent years, allegations of blood-doping in professional cycling were never far from the headlines.
Now the news is about a reported federal probe into whether cycling star Lance Armstrong (pictured right) and his former teammates took performance-enhancing drugs while competing on a team with a sponsorship contract with the U.S. Postal Service between 1997 and 2004.
Armstrong, a seven-time Tour de France champion, is no stranger to cheating allegations. But despite little solid evidence that he ever did anything illegal, Armstrong's reputation took another hit in early June when former teammate Floyd Landis admitted to taking banned substances and claimed that Armstrong taught him and others how to beat the system.
After a back-and-forth between the two cyclists, reports emerged in early July that the feds had launched their own investigation. Why? Because the U.S. Postal Service-sponsored team that Armstrong led from 1996 through 2004 received roughly $10 million per year in government funds.
The investigation has brought on a peloton of Am Law 100 defense lawyers. Landis got the bike moving in June when he hired Wilson Sonsini Goodrich & Rosati--a firm known for representing another Armstrong adversary, three-time Tour de France winner Greg LeMond. (Partners Mark Handfelt and James DiBoise, who have handled matters for both LeMond and Landis, did not respond to requests for comment. LeMond has been subpoenaed to testify in the probe.)
The Daily Journal in Los Angeles reported this week that Armstrong has hired Sheppard Mullin Richter & Hampton partner Bryan Daly, a former federal prosecutor and cochair of the firm's government contracts and white-collar defense practice.
Daly, who did not respond to a call seeking comment, previously represented Milberg when it paid $75 million to settle a federal investigation of a kickback scheme. Daly was a partner at Mayer Brown at the time, leaving the firm for Sheppard Mullin in January 2009. He joins a legal team that already includes longtime Armstrong lawyers Sean Breen and Tim Herman of Austin's HowryBreen. (Herman, who didn't respond to an interview request, has called on federal prosecutors to stem a flow of media leaks about the probe.)
Several of Armstrong's former teammates are also lawyering up. ESPN.com reported on Thursday that Chris Manderson, a founding partner of Newport Beach, Calif.-based Manderson, Schafer & McKinlay, is representing one-time Olympic gold medalist Tyler Hamilton, who has been talking with federal investigators. (Sibling publication The Recorder reported in May on Manderson's move to launch his own shop with three former colleagues from Paul, Hastings, Janofsky & Walker. That story revealed Manderson's relationship with client Rock & Republic, a jeans maker whose owner, fashion mogul Michael Ball, owns the Rock Racing-Murcia cycling team that employs Hamilton.)
Another ex-teammate, George Hincapie, reportedly has turned to Katten Muchin Rosenman litigation chair Zia Modabber for counsel. Modabber, who also did not respond to a request for comment, previously represented swimsuit maker Speedo in a lawsuit against competitor LZR.
Federal investigators reportedly are interested in speaking with all of Armstrong's former teammates, although a lawyer familiar with the probe tells us this is all still in the "early stages" and that any potential indictments could be months away.
Lawyers Could Determine Reggie Bush's Heisman
After the NCAA dropped the hammer on USC in June, hitting the school with a bevy of sanctions over a two-year period for improper benefits to former football star Reggie Bush and basketball star O.J. Mayo, the debate has started over what will become of Bush's 2005 Heisman Trophy. (The Heisman is awarded annually to the best player in college football.)
Earlier this week USC sent back a copy of Bush's actual Heisman that was on display at the school. But the Heisman Trust has not yet decided whether it will ask Bush to return the trophy awarded to the running back. (Bush's lawyer--Shawn Chapman Holley of Santa Monica's Kinsella Weitzman Iser Kump & Aldisert--has been busy these days advising her other superstar client, Lindsay Lohan.)
A spokesman for the Trust, which is based in New York, did not immediately respond to a request for comment. But the president of the board that oversees the Trust, New York attorney William Dockery of Scotto & Dockery, said in a statement that it would "consider the issues" raised as a result of the NCAA sanctions but that there was no timetable for a decision on Bush's Heisman.
If a decision is rendered, it will be by the eight members of the Trust's board of directors. The Am Law Daily pulled some charitable filings and found that at least half of those members are lawyers. Besides Dockery, they include: Michael Comerford of Garden City, N.Y.-based Comerford & Dougherty, Brian Obergfell of Emmet, Marvin & Martin, and Carol Pisano, an insurance litigator with McElroy, Deutsch, Mulvaney & Carpenter.
According to her Web profile, Pisano serves as cocounsel to the Trust. Pisano did not respond to a request for comment. ESPN.com reports that decisions by board members are based on a majority vote, but that an issue of extreme importance, such as Bush's trophy, could require a "super-majority" of six or eight votes.
Around the Horn
-- Williams & Connolly partner and longtime player agent Lon Babby agreed this week to become the president of basketball operations for the Phoenix Suns. Babby, who represented clients like Grant Hill, Ray Allen, Tim Duncan, and Shane Battier, called the Suns job the "opportunity of a lifetime." Early in his career Babby represented John Hinckley, the man who tried to assassinate former president Reagan. He previously served as general counsel to the Washington Redskins and Baltimore Orioles. Both teams were once owned by W&C cofounder Edward Bennett Williams.
-- Add one more Am Law 100 firm to the docket in the Texas Rangers bankruptcy case. After several raucous hearings this week in Fort Worth, a bankruptcy judge has ruled that a planned August 4 auction for the team will take place. Greenberg Traurig business reorganization and bankruptcy partner Clifton Jessup, Jr., is advising Dallas Mavericks owner Mark Cuban, who could be a potential bidder for the team. Jessup and Cuban did not respond to requests for comment, but another lawyer jockeying for a seat at the proceedings told us that another bidder, Houston businessman Jim Crane, is no longer being represented by Proskauer Rose. Rangers president Nolan Ryan, another bidder for the franchise, testified about the team's tight finances on Thursday.
-- The NHL nixed a 17-year, $102 million contract that high-scoring forward Ilya Kovalchuk signed with the New Jersey Devils this week. In a statement by deputy commissioner William Daly--a Skadden, Arps, Slate, Meagher & Flom alum--the league claimed Kovy's contract circumvented the salary cap. Devils GM Lou Lamoriello issued a rebuttal of that assessment; the team wouldn't be the first to exploit the salary cap loophole. The NHL is being advised by its longtime labor and litigation counsel: Proskauer's L. Robert Batterman and Skadden's Shepard Goldfein. The players' union has five days to object to the ruling, which if contested, will go to arbitration. Spokesmen for the league and the NHLPA did not immediately respond to requests for comment, nor did Devils general counsel Joseph Benedetti. (Side note: Lamoriello's son, Timothy, is a staff attorney for the team.)
-- Former NHL star Sergei Fedorov dropped a legal malpractice suit this week he filed against his former lawyers at Birmingham, Mich.-based Hyman Lippitt. Forbes reports that parties in a joint stipulation for dismissal stated they had resolved their dispute. Fedorov claimed that a conflict of interest by Hyman Lippitt cost him millions in lost investments. The former Red Wings center, who now plays in Russia, was represented by Dean Googasian from The Googasian Firm. Hyman Lippitt turned to Michigan firms Maddin Hauser Wartell Roth & Heller and Zausmer, Kaufman, August, Caldwell & Tayler.
-- NFL general counsel Jeffrey Pash, a former Covington & Burling partner, had some choice words for NFLPA executive director DeMaurice Smith in an interview with ESPN Radio on Thursday. Pash was responding to comments by Smith--a Patton Boggs alum--about the status of collective bargaining negotiations between the league and players' union. The labor dispute got litigious last month, and if the words of these two lawyer-leaders are any indication, both sides are still far apart.
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