Illinois Governor Appoints Quarles & Brady Partner to READ Board

Quarles & Brady LLP announced that Chicago partner Everett S. Ward has been appointed by Illinois Governor Bruce Rauner to serve as a public member of the Real Estate Administration and Disciplinary Board.

“I’m extremely honored to have been appointed by Governor Rauner and to have the opportunity to represent consumer interests,” said Ward. “I’m looking forward to working with the board in any capacity that I can.”

The READ Board consists of three public members who represent consumer interests, six real estate brokers or managing brokers, and an Illinois Department of Financial & Professional Regulation (DFPR) real estate coordinator. Prior to appointment, all board members must have held residency in Illinois for six years.

“We are so proud of Everett,” said Chicago Office Managing Partner Paul L. Langer. “He is a great fit for the READ Board and we are grateful that he is representing Quarles & Brady.” Ward is a member of the firm’s Real Estate Practice Group, where he represents corporate, commercial, and not-for-profit clients in the acquisition, disposition, financing, and leasing of commercial, industrial, and residential real property. He is AV® Peer Review Rated by Martindale-Hubbell, has been named an Illinois Super Lawyer®, and was named a 2015 Business Leader of Color by Chicago United.

He received his bachelor’s degree from Princeton University and his law degree from Harvard Law School.

 

 




Chevron’s Pollution Victory Opens Door for Companies to Shirk Foreign Verdicts

Corporations seeking to avoid enforcement of foreign judgments they contend are based on corrupt proceedings may have a new weapon now, thanks to a ruling by a federal appeals court over Chevron’s long-running Ecuadorian pollution litigation, reports BloombergBusinessWeek.

The court affirmed that a lawyer for victims engaged in wrongdoing to secure a $9.5 billion verdict in the South American country.

“The decision hands well-heeled corporations a template for avoiding legal accountability anywhere in the world,” says Deepak Gupta, the lawyer representing Steven Donziger, the controversial New York attorney who has been battling Chevron over pollution liability in Ecuador for decades.

Paul Barrett explains that “the case began with pollution in oil fields operated by Texaco Inc. in the rain forests of Ecuador in the 1970s and 1980s. In 1993, Donziger and other U.S. lawyers sued Texaco in New York on behalf of villagers and indigenous tribe members. Chevron acquired Texaco and its potential liabilities in 2001. The pollution case was dismissed by U.S. courts and restarted in Ecuador in 2003.”

Read the article.

 

 




Judge Fines Foreclosure Law Firm $1.8 Million for Bogus Billings

A Denver judge has fined one of the city’s prolific foreclosure attorneys $1.8 million for billing thousands of consumers facing the loss of their homes for title-insurance policies that did not exist, reports The Denver Post.

David Migoya writes that the Colorado Attorney General’s office argued in a seven-day trial in February had alleged in a February trial that Robert Hopp Jr., while working at his now-defunct law firm, billed customers fighting foreclosure for policies that were never issued. And Hopp inflated the cost of the few that were, the AG’s office claimed.

“The 37-page judgement handed down last week by Denver District Judge Shelley Gilman is the latest in a number of cases the state filed in 2013 against lawyers that specialized in foreclosures and allegedly padded their bills for costs that were ultimately borne by consumers losing their homes, the banks foreclosing on them and taxpayers whose federal insurance agencies covered the costs,” according to the report.

“Homeowners facing foreclosure had no choice but to pay the costs in order to stop the foreclosure process, and there was no process in place to challenge any of the fees lawyers said they were owed,” Migoya writes.

Read the article.

 

 




Wearable Technology That Monitors Workers Could Lead to Legal Problems for Employers

Smartwatch - wearable electronic monitoring deviceWearable electronic monitoring devices have been long used to help monitor an individual’s health and fitness, writes Karen Turner for The Washington Post. “But now wearable use is becoming increasingly common in the workplace to record, analyze and enhance worker productivity, raising concerns among lawyers and labor specialists who feel that it’s a step toward stripping employees of workplace rights.”

She quoted from a recent study by customer management software company Salesforce showing that 86 percent of U.S. companies plan to invest more in wearable applications on the job this year. And 40 percent are considering using wearables to monitor employee time management and real-time employee communication.

But some labor lawyers are concerned about unintended legal consequences. For instance, some employees might not be meeting productivity standards due to a medical condition or disability. And employers could be sued simply because they have access to physical data about their employees.

Read the article.

 

 




PwC Must Face $1 bln MF Global Malpractice Lawsuit: U.S. Judge

A federal judge rejected PricewaterhouseCoopers’ bid to dismiss a $1 billion lawsuit accusing the accounting firm of professional malpractice for helping cause the October 2011 bankruptcy of brokerage MF Global Holdings Ltd., reports Reuters.

U.S. District Judge Victor Marrero in Manhattan said there remained open questions concerning whether PwC’s alleged bad accounting advice was a substantial cause of MF Global’s rapid demise.

“PwC has not satisfied its burden of demonstrating the absence of any genuine issue of material fact,” Marrero wrote.

“PwC stands by its work for MF Global,” James Cusick, a lawyer for the firm, said in a statement. “MF Global’s collapse was caused by its own business decisions and adverse market events, not any accounting determination.”

Jonathan Stempel reports that MF Global sought Chapter 11 protection after investors grew anxious about a $6.3 billion investment in European sovereign debt, a large quarterly loss, credit rating downgrades, margin calls, and the use of customer funds to shore up liquidity.

Read the article.

 

 




Citigroup Beats $800 Million Appeal By One-Time Billionaire

Reuters is reporting that a federal appeals court rejected a one-time Florida billionaire’s bid to revive his $800 million lawsuit accusing Citigroup Inc. of fraudulently hiding its exposure to subprime and other toxic mortgages, inducing him to hold on to shares he otherwise would have sold.

The 2nd U.S. Circuit Court of Appeals in Manhattan said Citigroup and former officials, including two chief executives Charles Prince and Vikram Pandit, were not liable to trusts and corporate entities overseen by Arthur Williams and his wife, according to the report by Jonathan Stempel.

“Williams, the founder of what became Primerica Financial Services, has said he had planned in May 2007 to sell his 17.6 million Citigroup share stake, but decided to sell just 1 million because the bank assured investors it was in good shape,” the report says. but the assurance proved faulty, as the share price declined, with Williams saying he lost “the financial benefit” of his life’s work.

Read the article.

 

 




Veterans Returning to Work After Military Service May Not Be Discharged Except for Cause

Soldier - veteranEmployers should be aware that the Uniformed Services Employment and Reemployment Rights Act of 1994 modifies at-will employment by creating a “for cause” standard of discharge for veterans who return to work after a month or more of military service, according to Orrick’s Employment Law and Litigation Blog.

A returning  veteran who served 30-180 days may not be discharged except for cause for six months following return to work, according to the article by , and . Veterans returning after more than 180 days of service are afforded the same protection from discharge for one year.

“Employers need to make sure that Human Resources and managers understand the full range of obligations with regard to returning veterans and perhaps consider a coordinated or centralized approach to their reemployment,” they write. “In some cases, compliance with the complexities of the statute may require advice of counsel.”

Read the article.

 

 




Debate Over Allocation Wells Continues

Oilwell-gas-frackingHorizontal wells drilled across lease lines were clearly not contemplated in a typical oil and gas lease, and lessors should not be forced to accept a formula for royalty payment to which they have not agreed, advises  of Graves Dougherty Hearon & Moody in an article published in Oil and Gas Lawyer Blog.

His article discusses some recent articles published on the subject of allocation wells. He describes an allocation well as one “that crosses one or more lease lines and that produces from more than one lease without pooling those leases and without any agreement with the royalty owners as to how production will be allocated among the leases crossed by the well.”

“Whether or not one calls it pooling, allocation of production from a well drilled across multiple tracts is a method of sharing production among the owners of those tracts. In Texas, that cannot be done without the lessors’ agreement,” he continues.

Read the article.

 

 

 




Lessons Learned in Over 500 Software License Disputes

SoftwareRegardless of whether the publisher is Microsoft, Adobe, Autodesk, Oracle, IBM or any of their trade groups including the BSA | The Software Alliance, Robert Scott of Scott & Scott LLP sees common issues.

In a new online publication, he identifies some of those common issues, which include audit effective date, scope, discovering the installations, identifying proof of licenses, interim confidentiality / 408 agreements, calculating financial exposure, what constitutes a good settlement, and confidentiality.

On the issue of scope, Scott writes: “Narrowing the scope of a requested audit is one of my first priorities in a software audit case. I like to think of scope in a number of different ways all with an eye toward narrowing the number of devices to be investigated as much as possible at the outset of the case. Scope limitations could be to certain business units or affiliates, certain geographic locations, certain products, certain purchasing agreements. Winning the scope battle is an early success factor in an audit case.”

Read the article.

 

 




Business Groups Sue Over New U.S. Limit on Tax-Driven Foreign Buyouts

Reuters is reporting that two business groups have sued the Obama administration over a crackdown on U.S. companies that try to reduce their U.S. taxes by rebasing abroad in a process known as inversion.

Plaintiffs in the suit filed in a federal court in Texas are the U.S. Chamber of Commerce and the Texas Association of Business. They claim that a U.S. Treasury Department regulation enacted in April exceeded the department’s authority.

“The lawsuit was the first to challenge a rule on inversion,” write David Ingram and David Morgan. “The deals are legal, but have drawn criticism from some politicians who say U.S. companies that do them are avoiding their tax obligations. A wave of inversions largely ended after Treasury moved against the deals.”

The rule helped scuttle what had been a planned $160 billion combination of Allergan and U.S. drugmaker Pfizer Inc in what would have been the largest inversion ever, the report says.

Read the article.

 

 




Judge Reprimands Five Class-Action Lawyers for Alleged Forum Shopping

A federal judge has reprimanded Texarkana attorney and University of Arkansas System Trustee John Goodson, his law partner and three other lawyers for ethics violations and abuse of the court system, according to a report on Arkansas Online.

Chief U.S. District Judge P.K. Holmes III’s also included Goodson’s Texarkana partner Matt Keil, Jason Roselius of Oklahoma City, and Richard Norman and Martin Weber Jr. of Houston.

The judge had earlier accused Goodson and 16 other lawyers of forum-shopping a class-action lawsuit all were involved in, reports Lisa Hammersly.

The judge wrote in his order that the lawyers “engaged in improper mid-litigation forum shopping in a manner calculated to evade federal review and prevent the court from carrying out its obligation” to class members.

Read the article.

 

 




Former FBI Agent to be Sentenced for Lying at Bulger’s Trial

A former FBI agent faces sentencing for lying during his testimony at the 2013 racketeering trial of Boston gangster James “Whitey” Bulger, reports The Boston Globe.

Prosecutors and the defense have have proposed a plea agreement that recommends two years probation for Robert Fitzpatrick, 76, who is suffering from kidney disease, cancer, and diabetes.

“Fitzpatrick, who served as second-in-command of the FBI’s Boston office from 1981 to 1986, pleaded guilty in May to six counts of obstruction of justice and six counts of perjury for testimony that exaggerated his accomplishments and assisted the defense,” reports . “It marked a dramatic reversal for Fitzpatrick, who has been an outspoken critic of the FBI’s handling of Bulger since it was publicly revealed in the late 1990s that the gangster was a longtime informant who got away with murder while being protected from prosecution by corrupt agents.”

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Administrative-Law Rulings Heighten Significance of Next Supreme Court Appointment

Regulatory agencies have grown into what some call a “fourth branch” of the federal government, writes Richard O. Faulk of Alexander Dubose Jefferson & Townsend LLP.

“The threat posed by this de facto branch, also known as the ‘Administrative State’ or, more colorfully, our ‘Junior Varsity Congress,’ has attracted the growing attention of a number of Supreme Court justices,” he writes in the Washington Legal Foundations’s Legal Pulse.

Critics of judicial deference in administrative law had hoped that the court might grant certiorari in cases that would allow them plot a new course, but the death of Justice Antonin Scalia caused those hopes to dim, Faulk writes.

“Since none of the Court’s decisions after Justice Scalia’s death demonstrate that a majority exists to abrogate deferential judicial review, the continuing expansion of federal regulatory power—or its curtailment—may decisively hinge on the outcome of the 2016 Presidential elections,” the article says.

Read the article.

 

 




Browsewrap Agreement Held Unenforceable – Website Designers Take Note

Terms conditions contractsIn Nghiem v Dick’s Sporting Goods, Inc.,  the Central District of California held browsewrap terms to be unenforceable because the hyperlink to the terms was “sandwiched” between two links near the bottom of the third column of links in a website footer, write Jeffrey Neuburger and Daryn A. Grossman in Proskauer Rose LLP’s New Media and Technology Law Blog.

“Website developers – and their lawyers – should take note of this case, part of an emerging trend of judicial scrutiny over how browsewrap terms are presented,” they explain. “Courts have, in many instances, refused to enforce browsewraps due to a finding of a lack of user notice and assent. In this case, the most recent example of a court’s specific analysis of website design, a court suggests that what has become a fairly standard approach to browsewrap presentment fails to achieve the intended purpose.”

The authors discuss that case in detail, as well as some other browsewrap cases.

“These recent cases should prompt companies to reexamine electronic contracting practices to ensure that consumers are offered notice sufficient to understand that use of a website will constitute agreement to the terms,” according to the article.

Read the article.

 

 

 




Preventing Limitation of Liability End-Runs

Owners who are dissatisfied with their contractors’ performance increasingly assert fraud-based claims in addition to breach of contract claims because fraud-based claims are not typically barred by contractual waivers and limits of liability, according to a client alert published by Pepper Hamilton.

“Fraud-based claims may also create the potential for punitive damages in addition to compensatory damages,” wrote the authors, Ralph A. FinizioRobert A. Gallagher and Jane Fox Lehman. “Contractors and their counsel, however, can limit their potential exposure for fraud-based claims through careful contract drafting and thoughtful selection of the law to be applied to disputes.”

They wrote that contractors should first consider: the codified law of the jurisdiction where the project is to be built, statutes that regulate the availability of punitive damages, and differences in common law.

“Contractors should also keep in mind that their choice of law will likely impact the conduct and cost of any litigation, as well as the best choice of outside counsel to handle the matter,” they wrote.

Read the article.

 

 




Tinkering With Ipso Facto Provisions in Financial Contracts Could Send Them Sailing Out of Safe Harbors

The scope of the Bankruptcy Code’s safe harbor for certain financial contracts has been tested again, this time in the United States Bankruptcy Court for the Western District of Louisiana, according to an article written by Maurice Horwitz in the Bankruptcy Blog of Weil, Gotshal & Manges.

The question in the case he described was whether an ipso facto provision continues to be safe harbored if enforcement of that provision is conditioned on other factors – in this case, the debtor’s failure to perform under the contract. 

“Consistent with prior case law, the court held that termination is only safe harbored if it is based solely on a condition specified in 365(e)(1), i.e., the financial condition of the debtor, bankruptcy, or the appointment of a trustee,” Horwitz wrote. “Because the ipso facto provision in this case contained an additional condition to enforcement (the debtor’s breach), it no longer fell within the safe harbor.  Thus, even if both conditions were satisfied (bankruptcy and breach), the automatic stay applied and the termination clause could not be exercised absent relief from the automatic stay.”

Read the article.

 

 




Employees Bound By Clickthrough Agreements – ADP v. Lynch

Click here, writing in the Technology & Marketing Law Blog, discusses a case in which an employer successfully sued two departing employees for joining a competitor. The employer based its suit in part on a non-compete clause included the stock option grant documentation presented to employees electronically.

“We already knew that clickthrough agreements work really well in the B2B and B2C contexts,” writes Goldman. “Thus, it’s not surprising that clickthrough agreements also work in the employment context, at least so long as they are supported by consideration (and stock option grants usually, if not always, will provide sufficient consideration for additional contract terms). Although ink-signatures-on-dead-trees remains the gold standard for forming contracts with employees, forming contracts with employees online is probably a better method than some other traditional techniques, such as circulating employee handbooks or memos and embracing the fiction that an employee continuing to show up at work constituted acceptance. A clickthrough agreement provides tangible evidence that employees ‘got the memo’ (even if they chose not to read it); and the fact that no one reads online contracts is inconsequential in the context of employee handbooks, which are also widely celebrated as documents that no one reads.”

Read the article.

 

 




Wal-Mart Reported to Be in Talks to Buy Web Retailer Jet.com

JetCNBC is reporting that Wal-Mart is eyeing a potential acquisition of Jet.com, an online retailer created to challenge Amazon, according to a Dow Jones report citing people familiar with the matter.

“Though it isn’t clear how much the world’s largest retailer would cough up for Jet, a personal familiar with the talks told Dow Jones that the website could be worth $3 billion, the organization reported Wednesday,” according to CNBC.

The report by Krystina Gustafson adds that one-year old Jet.com has raised more than $500 million in funding in its quest to dethrone Amazon, according to CrunchBase.

Read the article.

 

 




Judge Wipes Out Patent Troll’s $625M Verdict Against Apple

AppleA patent-holding company that won a huge court victory against Apple had its victory wiped out, and its stock plunged by more than 40 percent, reports Ars Technica.

Earlier this year, in a jury trial in East Texas, Nevada-based VirnetX won a verdict for $625.6 million against Apple. VirnetX alleged Apple infringed on four of its patents, which are said to cover Apple’s VPN on-demand feature, as well as FaceTime. But the federal judge who heard the trial has now vacated the verdict and ordered a new trial for September.

But the judge “said that the complex, consolidated trial, as well as repeated references to an earlier trial in which Apple was found to have infringed VirnetX patents, created ‘potential for juror confusion’ and unfairly prejudiced Apple,” according to the report by . “The judge quoted a VirnetX attorney reciting an argument he viewed as potentially prejudicial.”

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Warren Buffett Made a Big Bet On an ‘In-Your-Face’ CEO

When Warren Buffett and Berkshire Hathaway Inc. bought Portland, Oregon-based Precision Castparts Corp. for $37 billion early this year, the investor acquired the services of Precision’s hard-charging CEO, Mark Donegan.

According to a Bloomberg profile by Noah Buhayar, Donegan is “a low-profile CEO with a great track record, relentless about staying ahead of the competition. During the 13 years he led Precision as a publicly traded company, its stock climbed 20-fold, annual revenue quadrupled to $10 billion and he bought dozens of businesses, consolidating a position as a key supplier to Boeing Co., Airbus Group SE and General Electric Co. It helped him attain a cult status among investors.”

“Behind the numbers, though, something more brutal is going on,” the profile continues. “For years, Donegan has traveled the globe, sometimes bullying staff during quarterly reviews at Precision plants.” And sometimes those reviews included profanity and threats.

Read the article.