The Work

November 5, 2008 9:00 AM

The Am Law Litigation Daily: November 5, 2008

Posted by Ed Shanahan

Edited by Andrew Longstreth

To: President-Elect Obama. From: The Private Bar. Re: We Want Change, Too.

Congratulations, Barack Obama. You've now inherited what many consider the most daunting challenges a modern president has ever faced. You know about those two wars we're fighting and the greatest economic crisis this country has seen since the Great Depression. But, lest you forget, there are also plenty of regulatory and legal policy issues that also have to be addressed. Who should take the lead role in securities enforcement? What changes, if any, should be made to bankruptcy and employment laws? What should be the top priorities of regulatory agencies like the Federal Trade Commission and the Food and Drug Administration?

Luckily for you, Mr. President-Elect, we have answers! The American Lawyer solicited opinions, advice, and predictions on those topics from some of the brightest stars in the private bar for its special Litigation 2008 issue. Antitrust attorney J. Mark Gidley of White & Case, for example, told the magazine that the country's "amnesty whistle-blower program is in its awkward teen years right now" and that the Department of Justice needs "to rethink the transparency of the program." White-collar defense attorney Steven Molo of Shearman & Sterling believes your new attorney general will have to decide "how aggressively to use criminal law to address business misconduct, which can also be addressed through regulatory or civil suits." (You can guess where he's going with that.) And the ever-insightful Bill Lee of Wilmer Cutler Pickering Hale and Dorr raises some tough questions regarding enforcement of IP rights in a global economy. "Wyeth and GlaxoSmithKline are building their newest and largest research facility in Shanghai," said Lee. "What will the IP protection be for the things built in China but developed by an American company?"

For historical perspective, the Litigation 2008 issue also describes how policies instituted at various agencies by the Bush administration have affected litigation in the United States--and how they will continue to have an impact. Here are reports on the FCC, the EPA, the FDA, the ICE, the Federal Reserve, and the Department of Education.

So, President-Elect Obama, when you get done cutting middle-class taxes, ending the war in Iraq, fixing health care, and moving the country toward energy independence, we've still got a few issues for you to take care of. Welcome to the hardest job in the free world.

In Supreme Court Argument over "Fleeting Expletives," Carter Phillips Uses None

Yesterday's second-biggest question (Obama or McCain being the first) was whether Sidley Austin's Carter Phillips would dare say "shit" or "fuck" at the Supreme Court as he argued on behalf of Fox Television Stations that the FCC had overstepped its authority in fining broadcasters that air utterances of the offending words. Much to our disappointment--and despite Phillips's use of the offending words before the Second Circuit--the Sidley partner kept things strictly PG at the high court.

Here's the transcript of arguments, which is sadly devoid of any actual cuss words. Instead, the lawyers and justices used grade-school-teacher formulations like "S-word" or "F-word." Phillips declined to comment when Tony Mauro of Legal Times asked why he resorted to such euphemisms.

There were, nevertheless, some colorful moments during the hour-long argument, according to Mauro's report. During an exchange with Solicitor General Gregory Garre, who argued for the FCC, Justice John Paul Stevens asked if regulators should consider whether or not the offending word was used humorously. "Some of these things, you can't help but laugh," said the 88-year-old justice.

At that point, Justice Antonin Scalia, known for his sense of humor, interjected, "Oh, it's funny. I mean, bawdy jokes are okay if they are really good."

Cravath Withdraws as Counsel to Convict Amidst Alleged Evidence Tampering

Back in June, we trumpeted the pro bono work of Cravath, Swaine & Moore attorneys Darin McAtee and Antony Ryan, who helped win a new trial for a client who had been convicted of a 1994 stabbing. A private investigator hired by the Cravath attorneys and their cocounsel--solo practitioner Thomas Hoffman--turned up an audio tape in which another man confessed to the stabbing for which their client, Kareem Bellamy, had been sent to prison. Queens Supreme Court justice Joel Blumenfeld vacated Bellamy's conviction and ordered his release pending a new trial.

But The New York Times reported last week that the informant who made the tape, Michael Green, has now informed prosecutors it was a fake. In court papers, Green also told prosecutors that he was "paid thousands of dollars by attorneys for Kareem Bellamy" to produce the tape.

At a hearing last week in the case, assistant district attorney Brad Leventhal asked Justice Blumenfeld to reinstate the conviction and send Bellamy back to jail. (Read the transcript of the hearing.) Justice Blumenfeld denied the prosecutor's request but set a November 13 hearing to address questions about the tape's legitimacy.

Cravath, which has withdrawn as Bellamy's counsel, has denied any wrongdoing, as has Hoffman. Cravath partner Stuart Gold, who attended the hearing last week but has not worked on the Bellamy matter, told us that Justice Blumenfeld directed his firm to withdraw because they may be called as witnesses at the November 13 hearing.

Second Circuit Reinstates Bhopal Water Contamination Class Action

A class action alleging damages from contaminated water near the site of the notorious 1984 Union Carbide gas explosion in Bhopal, India, has had almost as many lives as a cat. On Monday, a three-judge panel from the U.S. Court of Appeals for the Second Circuit reinstated the suit, which had been dismissed sua sponte by Manhattan federal district court judge John Keenan. "The district court," wrote the appellate judges, "erred in the manner in which it converted the defendants' motion to dismiss into a motion for summary judgment."

A version of the case was first filed against Union Carbide and its former CEO Warren Anderson in 2001, a couple years after the British branch of Greenpeace conducted the first tests on water near Bhopal. That suit, fashioned as a class action, sought property and personal injury damages, cleanup of the site, and medical monitoring for the class. The case was dismissed, refiled, and dismissed again, essentially because plaintiffs weren't property owners and their personal injury claims were barred by the statute of limitations. Then in 2004 a team of plaintiffs lawyers--Cohen Milstein Hausfeld & Toll; Williams Cuker Berezofsky; EarthRights International; and solos Curtis Trinko and H. Rajan Sharma--tried again, filing a new class action that made most of the same allegations as the previous suit but purportedly solved the statute of limitations and standing problems.

Kelley Drye & Warren, representing Union Carbide, moved for summary judgment and a dismissal of the second case. In a 2005 opinion, Judge Keenan dismissed all but one claim. While the plaintiffs' appeal of that ruling was pending, Keenan addressed the last remaining claim. He granted summary judgement for Union Carbide. "This case is closed," he wrote in a 2006 opinion that radiates irritation. "The court directs the clerk to remove the case from the court's docket."

The appeals court found that Keenan had not given the plaintiffs adequate notice that he was converting the motion to dismiss into a summary judgment motion and did not provide them a chance to oppose summary judgment with evidence and arguments. The Second Circuit reinstated all the claims and remanded the case to Judge Keenan. (One can only imagine his joy at receiving the news.)

"We're hoping we'll finally get to the merits of the case," plaintiffs lawyer Richard Lewis of Cohen Milstein told the Litigation Daily. "This is a very serious problem. Thousands of people are drinking water contaminated with carcinogens." We also called Union Carbide counsel William Krohley of Kelley Drye for comment but didn't hear back.

--Alison Frankel

North Carolina Court Grants Plaintiffs Expedited Hearing in Class Action Contesting Wachovia-Wells Fargo Merger

Oh, shareholders--there you go again. In a class action pending in North Carolina state court, Wachovia shareholders are contesting Wells Fargo's purchase of the bank. Their case, which claims that Wachovia board members breached their fiduciary duty when they agreed to sell the company to Wells Fargo at a fire sale price, sounds an awful lot like the class action brought by former Bear Stearns shareholders protesting Bear's sale to JPMorgan Chase.

But it looks like the Wachovia case will be moving faster than the Bear class action, which is pending before New York Supreme Court judge Herman Cahn. In the Wachovia suit, North Carolina state court judge Albert Diaz on Monday agreed to expedite resolution of the plaintiffs motion for a preliminary injunction, ordering a hearing to be held November 24. At the same time, however, Judge Diaz denied the shareholders' request for expedited discovery. For some analysis of the ruling, check out this post at the North Carolina Business Litigation Report.

Representing the lead Wachovia plaintiff are Gregory Jones of Greg Jones & Associates and Robert Kornreich, Chet Waldman, and Carl Stine of Wolf Popper. The Wachovia defendants are represented by Robert Fuller, Garland Cassada, and Katherine Maynard of Robinson, Bradshaw & Hinson. Wells Fargo has T. Thomas Cottingham III, Patrick Robson, and Edward Fuhr of Hunton & Williams and Paul Rowe of Wachtell, Lipton, Rosen & Katz.

Magazine for Women Litigators to Launch in January

In today's competitive market for legal services, lawyers have become increasingly specialized. And so have the media that cover them. So it's maybe not so surprising that a magazine called Sue: For Women In Litigation is set to debut in January.

Chere Estrin, the founder of Sue, assured the ABA Journal that the demand is there. "We really saw a need [for a magazine] on issues that are not necessarily tackled by traditional publications," said Estrin, who also publishes a magazine for paralegals.

On its Web site, Sue (which was named by a commenter at Above the Law) is described as "a publication for women, not of a certain experience level--but of a certain attitude." Among the cover lines on the debut issue are "If Women Wrote the Laws," "Clawing Your Way to Become Head of the Department? There's a Better Way," and "Powerful Women in Litigation: They Ignored the Glass Ceiling and Got off the Sticky Floor."

If all goes well, here are a few suggestions from the Litigation Daily for possible spin-offs: "Mary: For Women in Matrimonial Litigation," "Lilly: For Women in Pharmaceutical Litigation," and (our favorite) "Pat: For Women in Sexual Harassment Litigation."

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"Regarding the court ruling on the Union Carbide case, the Second Circuit has sent the case back to the trial judge for limited further proceedings. The Second Circuit did not discuss the merits of the case or the merits of the trial judge's ruling of dismissal, and its decision should not be interpreted as a ruling on the merits.

"The Second Circuit said that the trial court should have allowed the plaintiffs 'a reasonable opportunity to meet facts outside the pleadings,' although indicating it as indeed 'a close case.' The Second Circuit concluded that 'it is appropriate to remand [send back] for what would appear to be relatively limited further proceedings in connection with consideration of summary judgment'.

"We believe that the trial judge will follow the Second Circuit's direction to allow additional proceedings and will then again rule on UCC's motions."

Sue magazine sounds like a terrific idea. To the Litigation Daily guy who couldn't resist poking fun: Move over American Lawyer. You're old, staid and past your prime.

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