President Donald Trump’s effort to reshape influential U.S. courts by stocking them with conservative judges faces at least one significant impediment, reports Reuters: some of the courts best placed to thwart his agenda have liberal majorities that are likely to stay in place in the short-term.

“Those courts, including an influential Washington appeals court and two appellate courts that ruled against Trump in cases involving his travel ban, all had an influx of fresh liberal blood under President Barack Obama,” writes Lawrence Hurley.

Hurley explains that in Obama’s eight years in office, he was able to make enough appointments to leave a strong liberal imprint on the federal courts. At the end of his second term, nine of the 13 federal appeals courts had a majority of Democratic-appointed judges.

Read the Reuters article.

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The government’s consumer watchdog has finalized a rule that will make it easier for people to challenge financial companies in court, reports The Washington Post.

The new Consumer Financial Protection Bureau rule targets arbitration clauses, which can show up on user agreements for credit cards, bank accounts and other consumer products.

“As a condition for receiving services or products, consumers often give up their right to join a class-action lawsuit with these clauses, and instead agree to settle any disputes in a private process known as arbitration,” writes the Post‘s Jonnelle Marte.

Now the rule will ban companies from using these agreements to block consumers from joining group lawsuits. But supporters of arbitration say the clauses can help companies and consumers save money by minimizing legal costs.

Read the Post‘s article.

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Thomas B. McVey of Williams Mullen has posted an article discussing a number of issues that a general counsel or CEO might present to the company in responding to a variety of hypothetical situations under the Export Administration Regulations, International Traffic In Arms Regulations, U.S. sanctions laws and U.S. import laws.

“The details of your response, of course, will vary depending upon the company and violations involved. A lot will have to happen quickly so it is important for you to be prepared in advance for this situation,” McVey advises.

The first step in responding to a possible export or import violations is to stop the potentially wrongful actions, he writes.

His article explains how to approach this task, along with the importance of collecting relevant information, analyzing possible violations, whether to consider a voluntary self-disclosure, responding to requests for information, other issues in enforcement actions, and personal liability.

Read the article.

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Secretary of State Rex Tillerson is expected to be deposed as New York Attorney General Eric Schneiderman expands his sweeping probe into whether Tillerson’s former employer, ExxonMobil, misled investors about the impact of climate change, reports JWN.

“Schneiderman’s office considers the nation’s chief diplomat a central figure in a case that pits the ambitious Democrat against a Texas energy giant and has divided attorneys general nationwide,” according to the report.

Some state prosecutors and Exxon’s legal team accuse the New York attorney general of abusing the power of his office to score political points. Schneiderman, however, says he he has the legal authority to depose the secretary of state, who served as Exxon’s CEO until joining the Trump administration.

Read the article.

The first part of the Department of Labor’s Conflict of Interest Rule went into effect in June, and a large group of newly-defined “fiduciaries” are now subject to certain requirements of the Best Interest Contract (BIC) exemption, a portion of the Fiduciary Rule that according to some commentators creates a private right of action for investors, reports Kilpatrick Townsend.

“The creation of a private right of action is one of the investment industry’s chief concerns with the Fiduciary Rule,” write Paul Foley and John I. Sanders. “Industry leaders claim that the BIC exemption creates a private right of action because it enables investors to bring breach of contract claims and class actions against the fiduciaries with whom they contract.  However, a federal judge from the Northern District of Texas flatly rejected this claim in Chamber of Commerce of the United States of America v. Hugler.”

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The health care bill the U.S. Senate is fine-tuning could have profound effects on elderly people who rely on nursing home care, says Houston-area elder law attorney Kelley Bentley of Roberts Markel Weinberg Butler Hailey PC. Bentley is board certified in estate planning and probate law by the Texas Board of Legal Specialization.

“The bill proposes large cuts to federal Medicaid support over several years with reliance on states to decide funding in the future. In Texas, nearly 70 percent of nursing home residents are enrolled in Medicaid.

“While many people may assume the program pays solely for health care for the poor, it also fills a gap for long-term care, including at-home and nursing home care for the elderly population. The cost of long-term care in the U.S. can be substantial and a serious drain on an individual’s assets. That includes middle-class retirees who sometimes have managed to save substantial assets. Some people simply outlive their savings for long-term care.

“Older people should take a hard look at their savings long before any health problems. Consider a long-term care savings plan or long-term care insurance and also talk to a lawyer about how to organize and protect assets. In Texas, long-term care Medicaid programs can provide a wide range of care, including nursing home, assisted living and at-home programs. The secret is to start to plan early, before the need arises as there are more options available for the preservation of assets. The goal is not necessarily to preserve assets for future generations, but to ensure that an individual (or married couple) has sufficient assets to cover any future long-term care needs.”

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Reuters is reporting that an ex-general counsel of insurer WellCare Health Plans Inc. pleaded guilty on Wednesday in federal court in Tampa to having made a false statement to Florida’s Medicaid program, prosecutors said, the latest former executive to be convicted in the case.

Thaddeus Bereday, indicted along with four other former WellCare executives in 2011, faces a maximum of five years in prison.

“Bereday’s plea came after the U.S. Supreme Court in April declined to hear an appeal by former WellCare Chief Executive Todd Farha of his fraud conviction for his role in a scheme to cheat the Medicaid health insurance program for the poor,” writes reporter Nate Raymond.

Read the Reuters article.

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Liberal activists are thrilled to be suing President Donald Trump, reports Bloomberg Law.

The article by Paul Barrett and Dune Lawrence quotes Norman Eisen, the chief White House ethics lawyer for President Barack Obama: “The reason you’re seeing a proliferation of lawsuits against President Trump is that he brought his lifelong contempt for the rule of law with him to the Oval Office.”

A varied collection of plaintiffs accuse Trump of improperly profiting from private businesses such as his Washington hotel, which has been patronized by officials from Saudi Arabia, Kuwait, and other countries.

“Yet another legal challenge has blocked a separate executive order cutting off certain federal funds from ‘sanctuary cities,’ which refuse to have their police departments help federal authorities target immigrants for deportation,” the authors report.

Even some stare and local governments are taking Trump to the courthouse.

Read the Bloomberg article.

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Manatt, Phelps & Phillips LLP announced that Jack Quinn has joined the firm’s Washington, D.C., office as a partner in the litigation group and as chair of the firm’s federal regulatory and government practice.

“Jack is a tremendous addition,” said William T. Quicksilver, Manatt’s chief executive officer and managing partner. “His experience both in and out of government adds a further dimension to our strong national practices, serving clients who face major crises that may involve litigation, regulatory, public policy or legislative elements. Companies and individuals under government scrutiny at all levels will benefit from his exceptional legal and crisis management counsel. Jack has honed truly extraordinary skills at the intersection of law, public policy, politics and communications, and his professionalism has earned him a great reputation and great relationships across partisan political divides.”

In a news release, the firm said:

Immediately before joining Manatt, Quinn chaired Quinn Gillespie & Associates, a bipartisan public affairs firm he co-founded in 2000 to provide government relations and strategic communication services. His clients spanned the high tech, financial services and insurance, telecommunications, industrial and healthcare fields. In recent years, he also practiced law as a solo practitioner and served as co-counsel in major mass tort litigation.

“Jack is a Washington legend,” said Douglas Boggs, Manatt’s D.C. office administrative partner. “A definitive Capitol insider, he knows the executive and legislative realms from the inside out. When trouble strikes, Jack is who you want to help navigate the regulatory and political shoals inside the Beltway. We are thrilled to welcome him to Manatt.”

Quinn added, “I have long been an admirer of Manatt’s unique approach — bringing top-tier lawyering, notably in the litigation group, together with astute business consulting and strategic advocacy. This seamless combination of disciplines mirrors my own career to this point, and allows the firm to provide particularly creative, highly effective solutions for clients. The energy and engagement here are infectious, and I look forward to working with this talented team.”

Quinn’s government service includes serving as counsel to the president of the United States. In that role, he advised President Bill Clinton and senior White House staff on the legal aspects of policy proposals, legislation, and certain classified and unclassified executive actions, as well as on investigations undertaken by both independent counsel and congressional committees. At the time of his appointment as White House counsel, Quinn was chief of staff and counselor to Vice President Al Gore.

Quinn practiced law at an Am Law 100 firm for more than 20 years. Early in his career, he worked on Capitol Hill, serving on staff for the U.S. Senate Select Committee on Nutrition and Human Needs and for a member of the Senate Finance Committee.

He has served on the boards of several companies, including Alternative Packaging Systems, The Water Company, Constellis Holdings Inc. (where he co-chaired the governance and compliance committee), the Philadelphia Stock Exchange, Fannie Mae and the Robert F. Kennedy Memorial.

After earning an undergraduate degree from Georgetown University College of Arts and Sciences, Quinn received his J.D. from Georgetown University Law Center, where he was an editor of the Georgetown Law Journal.

The Department of Energy has published a request for information soliciting guidance on potential regulations that should be modified or repealed to reduce burdens and costs, reports K&L Gates.

“This is part of a government-wide initiative to overhaul the federal government’s regulatory regime, set in motion with an executive order signed by President Trump just after his inauguration. This RFI also comes after President Trump signed an executive order, ‘Promoting Energy Independence and Economic Growth,’ which seeks to review all regulatory actions that hamper the domestic production of fossil fuels and nuclear energy,” according to the article.

Authors Tim L. Peckinpaugh, David L. Wochner, Kathleen L. Nicholas and David L. Benson write that the RFI sets a July 14, 2017, deadline for public comment.

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Lawsuits against President Trump for alleged violations of the foreign emoluments clause of the U.S. Constitution could result in the pretrial production of his personal tax returns, explains Paul Barrett for Bloomberg Businessweek.

“The plaintiffs say one of their first steps will be to demand, via pretrial discovery, copies of Trump’s elusive personal tax filings,” Barrett writes. “How better to assess the scope of the president’s international business affairs—and perhaps to discover why he has hidden his returns so defiantly?”

Trump’s refusal to divest himself of his business empire led to the suits, partly based on the use of Trump International Hotel in Washington by representatives of the governments of Kuwait, Saudi Arabia, Turkey and Georgia.

Read the Bloomberg article.

Texas lawyer Kent Sullivan, who helped build a potent state health care fraud unit as the No. 2 lawyer in the Texas Attorney General’s office, is convinced that more states will follow Mississippi and Ohio in suing to recover damages related to the opioid epidemic, reports a post on the website of Androvett Legal Media & Marketing. Sullivan, now a partner in the Austin office of Jackson Walker LLP, says states wield “a huge hammer” over defendants through their tough anti-fraud laws.

“I expect a national trend, a significant wave of lawsuits against the companies and organizations connected with the spread of these powerful prescription drugs. States will be very tempted by the significant potential damages that may be awarded in court to try to recoup some of the costs of treatment.

“There is, of course, a way to successfully defend these cases, but at the beginning, state governments have a huge advantage under Medicaid fraud and consumer protection statutes. There is an easier burden of proof and enhanced damages available under these laws. Intent or negligence often is not required to prove liability. You have a huge hammer over these companies’ heads, and they can be at risk of losing more than actual damages. The damages are often multiplied if you’re found liable, and the states can often recover attorneys’ fees.

“As government health care has expanded, so have anti-fraud actions by states. These lawsuits are not part of the traditional private party litigation framework, where the burden of proof is higher. In many cases, the defendants consider settlement to avoid the significant risk and high cost of litigation. It is fairly unusual for these cases to go to trial but, as I often tell clients, the way to obtain the best settlement is to be totally ready for trial.”

Sullivan, a former appeals court judge, was chief deputy AG to then-Attorney General Greg Abbott and ramped up the state’s Civil Medicaid Fraud Division from four lawyers to over 40. In 2012, Texas won a $158 million settlement from Johnson & Johnson over its improper marketing of the anti-psychotic drug Risperdal to patients on Medicaid from 1994-2008. It was the largest Medicaid settlement in Texas history and is believed to be the first settlement paid at that time to any state in the nationwide litigation over Risperdal.

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Documents released this week reveal that lawyers, lobbyists and industry executives who can now shape policies benefiting their former clients and companies have been allowed to work in the Trump administration, even with the president’s vow to “drain the swamp” of influence peddling, reports The New York Times.

The report by Eric Lipton and Danielle Ivory begins with an example:

Lance Leggitt helped collect $400,000 in fees last year while working as a lobbyist to try to influence Medicare policy at the Department of Health and Human Services — an agency where he now serves as chief of staff.

Under an executive order signed by President Trump in January, lobbyists were banned from that kind of government work. But Mr. Leggitt is among a half dozen officials across the federal government who have been granted special waivers to disregard ethics rules, according to a new set of documents released Wednesday.

Read the NYT article.

Politico reports that the Russia investigations are bad news for President Donald Trump, but they’re a blessing for white-collar lawyers and crisis consultants whose careers are primed to take off as the criminal probes unfold.

“More than a dozen attorneys and crisis communications specialists have already started working for Trump associates touched by the unfolding Russia scandal, according to a POLITICO tally. People close to the probes say that number is expected only to grow as more than 20 other senior campaign aides and White House officials begin receiving subpoenas, grand jury summonses and other requests from special counsel Robert Mueller as well as congressional committees,” write Darren Samuelsohn and Andrew Restuccia.

The authors quote Harlan Loeb, a crisis management expert who worked for Enron and other corporate clients and now chairs Edelman’s crisis and risk practice: “If you’re doing it right, it’s a career maker. This is the material that great books are made of.”

Read the Politico article.

At the time he was arrested for defrauding taxpayers of $600 million, disability attorney Eric Conn spoke multiple languages, had crossed the border 140 times in the past decade and had told at least six people he would flee the country instead of going to jail, reports the Associated Press.

A federal judge released Conn on $1.25 million bail last year, and then on Saturday, one month before a judge was supposed to sentence him to prison, Conn removed his electronic monitoring device and disappeared, writes the AP’s Adam Beam.

Some of his former clients who lost their primary source of income because of his scheme said their only surprise was that the system that let him leave.

Read the AP article.

BloombergBusinessweek reports on the story behind the accountant who might end up the best-paid whistleblower of all time, with a potential paycheck of $600 million, while Caterpillar, the 92-year-old pride of American industry, will experience something unfamiliar: public humiliation.

“In a 2011 deposition, a Caterpillar attorney asked [accountant Daniel] Schlicksup if his actions threatened to hurt shareholders. write Bryan Gruley, David Voreacos and Joe Deaux.

“It is absolutely in the shareholders’ best interests to have the most accurate financial statements they can have,” Schlicksup replied. “I don’t think that the shareholders of Enron would think it would have been such a bad deal if somebody would have caught that before it bankrupted the company and they lost everything they had.”

Read the BloombergBusinessweek article.

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Health records software developer eClinicalWorks has agreed to pay a $155 million to the federal government for civil fraud and kickback charges, according to HIT Consultant.

“Both the government and the whistleblower alleged that eClinicalWorks falsely represented to customers that its EHR [electronic health record] system complied with Meaningful Use requirements,” the publication says. “The settlement marks the first time an EHR vendor is being charged for the truthfulness and accuracy of representations made when seeking government certification of its EHR system and the government applying the federal Anti-Kickback Statute (AKS) law to the promotion and sale of EHR systems.”

The whistleblower alleged the company modified its software to pass testing, without being fully functional. The lawsuit listed several allegations against the company, such as kickbacks for recommendations, and failure to test its software adequately before releasing it.

Read the HIT Consultant article.

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The well-established revolving door from big law to a GOP Labor Department may need extra grease under President Donald Trump, writes Ben Penn for Bloomberg Law.

The search for political appointees to the department appears to be impeded by a shrinking pool of private attorneys willing to incur a lifelong Trump association. And the search isn’t helped by the steep pay cut, grueling confirmation process, and a post-work lobbying ban.

Penn writes that the shortage of lawyers in the DOL could make it difficult for the department to get to work on undoing large parts of the Obama administration’s labor agenda.

Read the Bloomberg article.

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When the Supreme Court suspended a prominent Massachusetts lawyer and threatened him with disbarment, it started a Boston legal drama that took two weeks to resolve, reports the Associated Press.

Reporter Mark Sherman writes that the confusion ended on Tuesday, when the court acknowledged it had the wrong guy in an order attributing its earlier action to “mistaken identity.”

The wrongly suspected lawyer was Christopher Patrick Sullivan, a partner with the Robins Kaplan firm in Boston and the incoming president of the Massachusetts Bar Association.

The court originally intended to react to a disciplinary notice from a New York State court concerning a Christopher P. Sullivan, who is in prison in Vermont, serving a sentence for drunken driving that resulted in the death of a 71-year-old woman in 2013.

Read the AP article.

Reuters is reporting CVS Health Corp’s Omnicare unit has agreed to pay $23 million to resolve a whistleblower lawsuit alleging that it took kickbacks from a drugmaker to promote two antidepressants, according to settlement papers.

The agreement comes out of a 2007 lawsuit against the pharmacy operator by two former employees of drugmaker Organon USA Inc on behalf of the federal government and various states.

“The lawsuit claimed that from 1999 to 2005, Omnicare and certain pharmacies it acquired sought and received kickbacks from Organon in the form of discounts in exchange for promoting the antidepressants Remeron and Remeron SolTabs,” writes Nate Raymond.

Former Organon employees Richard Templin and James Banigan filed the suit, which reached a related $31 million settlement in 2014.

Read the Reuters article.

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