The Work

December 29, 2010 12:00 PM

Newsmakers of the Year 2010: The Cleanup Crew

Posted by Ed Shanahan

Last year was a big one for sifting through and cleaning up the wreckage wrought by the financial crisis. Whether it was the exhaustive autopsy of the Lehman Brothers collapse, the Securities and Exchange Commission accusing Goldman Sachs of duping investors, or Troubled Asset Relief Program recipients repaying the government, it seemed that order was being restored. Along the way, 14 people did enough to merit recognition in our Newsmakers of the Years feature. Some made the cut for wielding a metaphorical broom, some for getting caught in the sweep. Others on the list distinguished themselves in ways that had nothing to do with the recession and its fallout. On to 2011. There's plenty of cleaning yet to do.



•  In March, Lehman Brothers Holdings Inc. bankruptcy examiner and JENNER & BLOCK CHAIR ANTON VALUKAS (1) unveiled his 2,200-page report laying out what killed the investment bank—and nearly toppled the entire financial system. To Manhattan bankruptcy judge James Peck, it was well worth its $93 million cost. "I consider this to be one of the most extraordinary pieces of work product I have ever encountered," Peck said, adding, "It reads like a best seller."


•  Fresh off quitting  as AIG general counsel in the face of a steep, TARP–driven pay cut—and pocketing millions in severance--ANASTASIA "STASIA" KELLY (2) joined DLA Piper. "For someone to say, 'I think you're doing a great job, Stasia, but the American people hate you, and therefore we think you should make no more than $500,000 a year'—there's no logic to that," she told Fortune.

•  After viewing outtakes from the documentary Crude, which traces the multibillion-dollar toxic tort suit against Chevron over oil contamination in Ecuador, Manhattan district court judge Lewis Kaplan granted Chevron's motion to depose  STEVEN DONZIGER (3), the lead plaintiffs lawyer. Donziger, Kaplan wrote, "has acknowledged in the outtakes that the purported civil litigation in Ecuador 'is not a legal case. It's a political battle.' "

• "We appreciate this opportunity to be of service to you," MANATT, PHELPS & PHILLIPS NAME PARTNER CHARLES MANATT (4) wrote in an October 2009 engagement letter to lawyer Harold Brady, who was acting on the Jamaican government's behalf. Four months later, with the firm's role in an extradition dispute involving an alleged Jamaican drug kingpin generating controversy, the firm apparently felt differently. The contract was canceled.

• Charged with leading a $7 billion fraud conspiracy, R. ALLEN STANFORD (5) burned through lawyers (including Richard "Dick" DeGuerin of DeGuerin & Dickson and Robert Luskin of Patton Boggs) like so much petty cash. Stanford thought he was the one being ill-treated. "I am a man who has been treated like a piece of meat with attorneys who are more concerned with representing themselves to the public than representing me," he wrote in one court filing.


• "No one's going to say he's the sharpest knife in the drawer, but he's not corrupt," said ROD BLAGOJEVICH (6) attorney Sam Adam, Jr., during closing arguments in the former Illinois governor's corruption trial. While the jury convicted Blagojevich of one count of making false statements to federal authorities, it failed to reach a verdict on 23 other counts. Get ready for Blago on Trial, Part II, in 2011.

• Call him  the special master specialist. If there was a mass mediation, KENNETH FEINBERG (7) was there. He helped finalize a settlement between New York City and 9/11 first responders harmed by toxic Ground Zero dust, led the Obama administration's push to cap TARP recipients' executive pay, and headed BP's $20 billion gulf spill compensation fund. "I keep saying that: I hope this is the last emergency," he told The Washington Post. Hope denied.

•  Even for Florida, disgraced Fort Lauderdale plaintiffs lawyer SCOTT ROTHSTEIN'S (8) one-year whirlwind transition from noted philanthropist and political fund-raiser to convicted Ponzi schemer and mob informant was remarkable. "I am truly and deeply sorry for what I have done,"  Rothstein told the judge who sentenced him in June to 50 years in federal prison. "I don't expect your forgiveness. I don't."


• Aggressive efforts  to hold Wall Street accountable for the financial crisis--negotiating, for example, a $725 million shareholder class action settlement with AIG for three state pension funds--didn't save Ohio attorney general RICHARD CORDRAY (9) on Election Day. Why didn't his work on behalf of economically battered Buckeyes pay political dividends?  "Most people are hurting," he told The New York Times before the election,  "and they don't have the time to pay attention to us."

•  Word that GIBSON, DUNN & CRUTCHER'S TED OLSON (10) would pursue a constitutional challenge to California's gay marriage ban with BUSH V. GORE ADVERSARY DAVID BOIES (10) was greeted skeptically by the LGBT community, but Olson soon won over doubters. The National Center for Lesbian Rights's executive director even dubbed him an "honorary lesbian" before a federal district court judge handed Olson and Boies's clients a full trial court victory in August.

David Boies, meanwhile, was seemingly on all the year's big trials--from the gay marriage fight to Oracle's $1.3 billion software piracy win against SAP to representing Jamie McCourt in the so-called Dodger divorce to his client Terra Firma Capital Partners Ltd.'s unsuccesful multibillion-dollar suit against Citibank over Terra's purchase of EMI Group Ltd.  "It is a good thing David wasn't born a girl," his wife, Mary, likes to say, according to Fortune. "He can't say no."


ELENA KAGAN (11) may have authored a law review article chastising U.S. Supreme Court nominees for not responding substantively at their confirmation hearings, but she was pretty vague when her own turn came in July. Kagan did, however, reply bluntly when questioning turned to an attempted Christmas Day terrorist attack in Detroit and her whereabouts at the time. "You know,"  she quipped, "like all Jews, I was probably in a Chinese restaurant."

• "We out-and-out stole ideas from other law enforcement agencies or the private sector, if we thought they would work for us," SEC ENFORCEMENT CHIEF ROBERT KHUZAMI (12) told a group of business journalists weeks before filing the Goldman case. The former federal prosecutor, who became the agency's top cop last year, vowed to continue to do whatever works to press additional cases. 

GOLDMAN SACHS TRADER FABRICE TOURRE (13) became the face of bad financial-industry behavior in April, when the Securities and Exchange Commission accused him of helping Goldman defraud investors via an instrument dubbed Abacus. Fabulous Fab's image suffered further with the release of e-mail nuggets like  "I managed to sell a few ­[A]bacus bonds to widows and orphans that I ran into at the airport." Goldman and the SEC ultimately reached a $550 million settlement; Tourre still faces a potential trial.


From the January 2011 Issue of The American Lawyer

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