Author: TSA Press

As in-house counsel, I’d like to think we offer our business partners a wide array of services, some more quantifiable than others. Sometimes those services are strictly legal, while other times they take on a more business advisory quality. And then every once in a while, we wind up in that weird “it’s not really my job to do this, but if I don’t say something now, shit is going to get weird” territory.

Well, I don’t know if it’s the current state of politics or the general panic of impending holidays or what, but I swear I’ve spent more time this year than usual answering questions, clearing up misconceptions, and stopping the spread of misinformation across the business.

And in no particular order, here are a few of the completely bizarre misconceptions and assumptions I’ve encountered to date:

1. In-house counsel do not “receive a cut” on the contracts we negotiate. Ethical obligations and a general moral ick factor prevent us from doing so. Besides we’d much rather get a percentage of the money we save the company through prevention of general business dumbassery and/or the need to incur outside legal fees.

2. By the power vested in me as the Company Lawyer, I can make all manners of policies and red tape disappear. Yeah, so it’s kind of the opposite. As an attorney, I’m supposed to follow the rules set forth by our company. Not break them. It’s actually in my job description to abide and promote company policies and directives, so yeah…I can’t come up with a loophole for you to get around no indemnification in your contract. One does not simply walk into Mordor and demand approval for a waiver of all damages.

3. And tangentially related to #2, there’s this perception that I somehow get my jollies saying “No.” Contrary to popular belief, it’s not my professional or personal aspiration to say no. Before I even consider using that word, I think through all of the potential outcomes and repercussions that will befall me, and then I multiply that by the hours of pissing and moaning and thinly veiled threats I’ll have to endure courtesy of you and your boss.

4. “My legalese brings all the vendors to the yard, and I’m like, my contract’s better than yours, damn right it’s better than yours, I can teach you, but I’d have to charge…” Yeah, so as much as I’d like my life to resemble a certain iconic pop anthem, I can’t get on the phone with the vendor’s counsel, snap my little fingers, and make them see reason. That’s why it’s called a negotiation. If I could just get people to do what I wanted all the time…we wouldn’t be having this conversation.

5. “Requiring Legal review” per our contract policy actually requires a living, breathing member of the Legal team to review your stuff. An email saying your boss reviewed our new T&E policy and the legal language looks fine is great… but your boss is in Finance. They’re a bunch of barely literate wookies. They don’t get a say on the fine print.

6. I’m basically a genie sitting around in my lamp wait to be summoned by the sales team at all hours of the day or night to turn contracts on timelines that are shorter than the average length of a bathroom break. I live to serve and perform minor miracles in my spare time. Dear kids, it’s like this: Rule number 1: I can’t kill anybody to get this deal done. So don’t ask. Rule number 2: I can’t make anybody fall in love with your half-baked profit-sharing scheme. Rule number 3: I can’t bring your crappy contract back from the dead. It’s not a pretty picture. I don’t like doing it.

7. Being the company lawyer does not mean I’m your personal lawyer. I represent the company. Please don’t bring me your leases, DUI questions, and hypothetical “what if I wanted to get away with murder” scenarios. I’m neither qualified nor authorized to opine on these. Also, my legal degree did not come up with a membership of the month club. I’m not a notary or a justice of the peace. I can’t stamp that real estate document for you, and I can’t marry you to your best friend of 10 years in a tasteful backyard ceremony. Not without some sort of internet ordainment.

8. I don’t know everything. No, really. Let that one sink in. Upon earning my law degree, the dean didn’t upload a bunch of useful skills and knowledge Matrix-style into my cerebral cortex. I have no idea what the average LIBOR rate was last quarter. I can’t quote a single provision from the IRC (never mind the one you requested; for the last time, I am not that guy from Suits). And really, I have no idea if it’s market for you to pick up admin expenses with your talent agencies. You know why? Because neither does the agency. They’re just making that up and hoping no one asks too many questions. Nobody actually tracks this. And if they do, it should be you… the business partner in the talent industry… not the in-house counsel.

9. But despite what I just said in #8, do trust me when I tell you that POS stands for “Point of Sale.” Really. It does not stand for what you would normally associate with that acronym. No self-respecting attorney would take the time to make that a defined term. But it would be hilarious if someone did. #FutureKayGoals

10. And finally, yes, I’ll answer your useless lawyer trivia question. There is a difference between a “J.D.” and an “Esquire.” A juris doctor is bestowed upon someone who has received a law degree. Esquire is a title reserved for licensed attorneys. And if you see someone using either in their email signature block, you should steer clear of them because they’re clearly a PITA. Which stands for exactly what you think it stands for.

As always, my email and DMs (just don’t get lost in my DMs) are open for sharing your own examples of hilarious misconceptions. Please note that while I’ll never use your name, with your permission, I’d be happy to share them over Twitter so that we all can join in the fun.

Kay Thrace (not her real name) is a harried in-house counsel at a well-known company that everyone loves to hate. When not scuffing dirt on the sacrosanct line between business and the law, Kay enjoys pub trivia domination and eradicating incorrect usage of the Oxford comma. You can contact her by email at KayThraceATL@gmail.com or follow her on Twitter @KayThrace.

Just a few days ago, copyright troll lawyer Richard Liebowitz was being threatened with jail time for refusing to provide a judge with some evidence his grandfather had died. If that doesn’t seem like something most judges would demand, you’re right. It takes a special kind of lawyer to drive a federal court judge to start demanding proof of death from an attorney.

Liebowitz had blown off a discovery conference. When called on it, he claimed his grandfather had died on April 12th, forcing him to miss the scheduled conference. The judge had other reasons to doubt Liebowitz’s claim — like other screwing around he had performed during this litigation, as well as his short, but colorful (read: sanction-heavy) litigation career.

This information was demanded again and again by the judge. Liebowitz again and again refused to provide documentation of his grandfather’s death. Sanctions were handed down, rising from $100/day to $500/day as Liebowitz continued to refuse to respond to the judge’s order. The judge gave Liebowitz one more chance to turn up in court with the proper paperwork. If he failed to do so, he was to be arrested.

Since then, there have been a couple of developments. William Bastone of The Smoking Gun managed to find evidence of Liebowitz’s grandfather’s demise.

A TSG investigation has determined that Liebowitz’s maternal grandfather did, in fact, die in April. But not on April 12, the Friday morning he failed to appear before Seibel.

Jaime Radusky, 93, died on April 9 at Weill Cornell Medical Center on Manhattan’s Upper East Side. Radusky, a Cuban émigré, lived in a penthouse apartment about 10 blocks from the hospital where he died. In the above Facebook photo, Radusky is seen poolside at the Miami Beach condominium complex where he owned a unit.

Details of Radusky’s death are contained in a probate petition filed in Surrogate’s Court in Manhattan by the two executors of Radusky’s estate, his son Henry Radusky and daughter Sara Liebowitz (Richard Liebowitz’s mother). Additionally, an affidavit sworn by an attorney representing Radusky’s heirs reported that, “The decedent died on April 9, 2019.”

So, the excuse wasn’t complete bullshit. But it was still mostly bullshit. Liebowitz swore repeatedly in multiple declarations that his grandfather died on April 12th. That was his excuse for missing the April 12th discovery conference. Liebowitz had a legitimate reason for missing this conference — the recent death of his grandfather — but for some insane reason, chose to give the judge the wrong date and spend the next six months adamantly swearing this falsehood was the truth.

Liebowitz’s last-ditch excuse — a filing that included some rather audacious assertions about the judge’s alleged inability to do her job — said the death of his grandfather was “too private” to be discussed in court. There’s not much that’s private about death. His grandfather’s death certificate is handed out to a number of government agencies to end benefits payments, cancel voter registrations, and — in this case — allow the state court to appoint a legal guardian for his grandfather’s surviving wife.

There’s more to this story. The Smoking Gun showed up in court for Liebowitz’s “tell me why I shouldn’t throw your ass in jail” hearing. This time, Richard Liebowitz showed up as well. Liebowitz showed up with representation. Good call. Not only was he facing possible jail time, but he had proven in this case (and multiple others) he probably shouldn’t ever represent himself, much less clients. It did not go well for the copyright troll lawyer.

[Judge Cathy] Seibel stated that Liebowitz knew he was lying about the date of his grandfather’s death, but “chose to repeat that lie six, eight, ten times” in court filings that the jurist said were part of a “long-term campaign of deception.” Liebowitz, Seibel remarked, “double-downed, triple-downed, quadrupled-downed, octupled-down, I don’t know what would come after that.”

“I question Mr. Liebowitz’s fitness to practice,” Seibel said at one point during the hearing.

There are many, many good reasons to question Liebowitz’s fitness to practice. This debacle is just the latest reason. Liebowitz has only been practicing for five years, but he’s been sanctioned multiple times and his shady litigation strategies have resulted in several orders to post high-dollar bonds before his clients’ cases can proceed.

His short history is catching up to him. It’s going to be a bit more difficult for Liebowitz to flood courts with speculative invoices.

Noting the significance of a lawyer who “intentionally lies to the court,” Seibel said she has referred the Liebowitz matter to the Grievance Committee for review and possible disciplinary sanctions. Seibel added that her contempt rulings against Liebowitz will require him to disclose the sanctions to other courts and prospective clients.

Good. This kind of litigation — threatening people with statutory damages and long, expensive litigation to extract quick settlements — is garbage. So are the people who practice it and profit from it. Liebowitz hasn’t been around long, but he seems determined to make the Prendas of the world look just a tiny bit better by comparison. If he’s forced to disclose his checkered courtroom past before approaching judges or clients, there will be fewer of each willing to entertain his bullshit.

Troll Lawyer Shows Up In Court To Explain His ‘Dead Grandfather’ Excuse, Gets His ‘Fitness To Practice’ Questioned By The Judge

More Law-Related Stories From Techdirt:

Needless Trademark Spat In Canada At Least Has Exactly As Polite Ending As You’d Expect
Universal Music Claims Copyright Over Newly Public Domain ‘Yes! We Have No Bananas’
Federal Court Says ICE, CBP’s Suspicionless Searches Of Electronic Devices Is Unconstitutional

As we covered in my last column, investment into legal technology companies (“Legaltech”) is growing, but questions remain as to how much substance there is behind the companies taking on all those investor dollars. I decided to turn to someone who’s seen the process from the inside to get their perspective.

I spoke with Noah Waisberg, co-founder and CEO of Kira Systems, an AI-based contract analysis software company. Waisberg started out his career as a corporate transactional associate at one of the biggest of the Biglaw firms. As Waisberg put it, he looked into his potential future as a partner, and didn’t like his options. “Junior corporate lawyers spent lots of time doing work they hated, and that they weren’t good at.” If all went perfectly, after a decade or more of work he disliked, he might be able to make $6-8M a year as a partner. But things rarely go as planned. Waisberg wanted a career path that he could control himself, one that didn’t require him being unhappy for a decade in the hopes that everything else would pan out just so.

Waisberg saw his opportunity in the inefficiencies he observed in Biglaw contract review. So much money got thrown at reviewing contracts by hand, but even the best lawyers would occasionally make mistakes when repeating endless, mindless contract reviews. If Waisberg could find a way to automate some of the human time required to review those contracts, while also reducing the error rate, he stood to change the industry — and make a pretty penny in the process.

Waisberg and his partner, Dr. Alexander Hudak, put their idea into practice in 2011 by founding Kira Systems. Originally they planned to have a state-of-the-art software solution in place within four months, and then start raising VC money and attracting clients within six. But as Waisberg had already identified, things rarely go as planned. It took not four months, but two years before the software was working reasonably well.

By 2013, Kira had made strides. Contract review time was cut anywhere from 20-90 percent, depending on the contract in question. So the good news was that Kira finally had a product. The bad news was they had little runway and no clients. Waisberg’s wife, herself a Biglaw associate, was funding the company and their growing family off her salary. Waisberg watched as their savings dwindled with each passing month, with the funds going to paying developers rather than keeping food on his own table.

The gamble paid off in 2014, however, when revenue started coming in, first as a trickle, and soon a torrent. The company grew from four employees to eight in 2014. Within another year they were up to 20. Today they’re at 190 employees. Kira currently services most of the top law firms in the US and UK. In August 2018, Kira took on $50M in venture capital funding for a minority stake in the growing company.

A Segmented Market

Waisberg sees the Legaltech VC market as basically split into two baskets. The first basket is the target of what he refers to as companies targeted by growth equity investors. Growth equity investors look to put their money behind companies that have proven the fundamentals of their business model. “If you’re over $10M in annual revenue, you’ll deal with growth equity investors, who are sophisticated.” Growth equity investors aren’t necessarily hunting for the next unicorn, or even seeking a 10X return. Growth equity investing is about shooting for a more relatively modest (for the VC world) 3-5X return, essentially trading lower return targets for more certainty that their investment is going into a viable business that gives their equity value.

Kira, with its organic growth and proven profitability, fit nicely into this category by the time it started seriously looking for outside funding. Other examples Waisberg gave in the Legaltech space would be Clio and LegalZoom, companies with name recognition in their industry and proven recurring revenue streams. Waisberg sees companies like that, which simply need cash to polish their product and potentially scale it up and take their proven model to a bigger market, as a fundamentally sound business investment. Whether in the legal space or elsewhere, financing the continued growth of a proven company will likely always be worth considering.

Waisberg contrasted his company with the other basket, the traditional startup looking for VC backing. These are the companies that have a solid idea, a working solution, but that haven’t proven themselves in the market yet. If they have revenue at all, it’s likely dwarfed by their ongoing expenses. These are the kinds of investments that lead to the stories of $1,000 in stock turning into billions of dollars a few years down the line. But they’re also the kinds of investments most likely to turn that same $1,000 into a goose egg.

If there’s a bubble in the Legaltech VC market, this is where Waisberg sees it. “When interest rates are low, money flows into alternative investments. Legal startup funding is an alternative investment.” Investors are excited to park their money in companies that give them that shot at the billionaire lifestyle, and they are often willing to overlook a lack of sound financial fundamentals in the hopes that problematic business models will sort themselves out with time.

What’s A VC To Do?

One of the most interesting things Waisberg mentioned during our conversation was that, while Kira took on $50M in venture capital last year, the company didn’t need it. Kira has been growing rapidly on its own. The infusion obviously made sense strategically, but it’s worth remembering that relatively young companies can still be grown the old-fashioned way: Good sales, excellent customer relations, and a quality product. Even in the dawning 2020s, when high finance seemingly has its fingers in everything, good ideas and good execution can sometimes make their way to the top without resorting to other people’s money.

Waisberg’s story also gives me confidence that, even if the overall VC market may be experiencing a bubble of overinvestment in the aggregate, the Legaltech segment is seeing real maturation that will stick around for the long haul. Automated contract review and management was a pipe dream at the dawn of the decade. It’s a nine-figure business at the decade’s close. Some lawyers are starting to understand that we have to change the way we do business, and they’re building the tools to do it with.

It may take our industry longer to get there than most, but we are beginning to embrace the future. Whether Biglaw gets to partake in the bounty, or whether it just sees its best and brightest leave to found their own companies, that remains to be seen. After all, things rarely go as planned.

James Goodnow

James Goodnow is an attorney, commentator, and Above the Law columnist. He is a graduate of Harvard Law School and is the managing partner of NLJ 250 firm Fennemore Craig. He is the co-author of Motivating Millennials, which hit number one on Amazon in the business management new release category. As a practitioner, he and his colleagues created a tech-based plaintiffs’ practice and business model. You can connect with James on Twitter (@JamesGoodnow) or by emailing him at James@JamesGoodnow.com.

* Harvey Weinstein’s lawyer claims his trial is expected to last two months. The trial is currently set to begin on January 6, 2020. [CNN]

* A law student has been elected mayor of a small town in Iowa. Please let this be the basis of a Parks and Recreation reboot. [Creightonian]

* A large group protested Justice Brett Kavanaugh’s presence at a Federalist Society gala last night in D.C. [Washington Post]

* A man handcuffed for eating a breakfast sandwich on a train platform plans to sue. At least he didn’t miss the most important meal of the day. [New York Daily News]

* The Senate yesterday confirmed a judge to the Second Circuit despite the fact that the candidate purportedly never argued an appeal or tried a case. I’m assuming this candidate at least knew what a motion in limine was… [New York Times]

* A new lawsuit has been filed alleging that a California law mandating that woman serve on the boards of companies is unconstitutional. [Washington Post]

Jordan Rothman is a partner of The Rothman Law Firm, a full-service New York and New Jersey law firm. He is also the founder of Student Debt Diaries, a website discussing how he paid off his student loans. You can reach Jordan through email at jordan@rothmanlawyer.com.

The 2020 National Budget Was Presented Today

Under the Theme

“Gearing for Higher Productivity, Growth and Job Creation”

The Minister of Finance and Economic Development, Professor Mthuli Ncube, presented the 2020 National Budget to the National Assembly this afternoon.

Budget documents available on Veritas website

The two main Budget documents are already on the Veritas website on the same webpage [link], where they can be downloaded.  They are:

(1)  the full 162-page 2020 National Budget Statement

(2)  the Minister’s 2020 National Budget Speech, which is an abridged version of (1).

Other documents to be available soon

The other documents supporting the 2020 Budget will be posted on the Veritas website as soon as available.  They are:

(3)  the 2020 Infrastructure Investment Plan

(4)  the 2020 National Budget Highlights

(5)  the Estimates of Expenditure (Blue Book), with detailed expenditure allocations

(6)  the Finance Bill

(7)  the Appropriation Bill.

Veritas makes every effort to ensure reliable information, but cannot take legal responsibility for information supplied.

Post published in: Business

RBZ on Monday released new notes in denominations of 2 and 5 Zimbabwe dollars to ease cash shortages in the economy and the banking public began accessing them on Tuesday, albeit in small quantities as banks limited transactions to between 40 and 100 Zimbabwe dollars.

However, pictures of stashes of the new notes taken outside the banks have been circulating on social media, prompting the RBZ and other interested stakeholders to take action.

The Ministry of Information, Publicity and Broadcasting Services said on Twitter on Thursday that the government, through the RBZ, was investigating the matter.

“Government through the Reserve Bank of Zimbabwe is investigating allegations of abuse of newly released bank note.

“Cash was collected by banks using their CIT (cash-in-transit) vehicles on Monday. All serial numbers were recorded in the register. The offending banks will be named and severe action taken,” the ministry said.

Post published in: Business

Zimbabwe has introduced new bank notes which has led to Zimbabweans forming long queues to withdraw the new money from banks and cash machines. But the effectiveness of the fresh liquidity injection will be tested this weekend when the country will be without its dominant mobile money platform, EcoCash.

Banks in Zimbabwe, including Standard Chartered and Standard Bank, started distributing the new money—in ZWL2 and ZWL5 notes as well as ZWL2 bond coins—on Tuesday. Authorities in Harare hope the supply of new notes, worth about ZWL 30 million (about $2 million on the official exchange), will end a cash crisis that has ravaged Zimbabwe for more than two years. But just $2 million is unlikely to be enough to keep the monetary system running in Zimbabwe if there’s also a mobile money shutdown.

The impact of the cash crisis has been best captured by consumers being forced to pay premiums of up to 50% to get their cash from mobile money agents as well as a run-away Zimdollar vs US Dollar parallel market exchange rate currently at 1:20 against 1:15 on the official interbank market.

The new bank notes mean Zimbabwe now has official currency notes since 2009 when the country, ravaged by massive hyperinflation, abandoned its own currency and embraced multi-global units including the US Dollar and the rand from neighboring South Africa. The new notes have evidently been on demand, with banks forced to institute withdrawal limits of ZWL100 (about $7) per day.

In the absence of cash, Zimbabweans have over the past few years heavily relied on mobile money and point of sale platforms for settlement of transactions. According to the Reserve Bank of Zimbabwe’s latest stats, mobile and internet based transactions amounted to ZWL14.57 billion (around $1 billion) for the month of August 2019, representing a 17.2% increase from the previous month.

EcoCash says it “will be carrying out a major system upgrade”. All services on the platform will be down starting 9pm local time this Saturday till 9pm the following day. For some, the disruption to EcoCash has come earlier, with some users taking to Twitter to express their frustrations at being unable to make payments at supermarkets. Zimbabwe listed Cassava Smartech, which now holds EcoCash, confirmed via Twitter that online merchant services were currently down as of Tuesday evening. For many shoppers, cash is always the default option but then cash has been in short supply in Zimbabwe.

Demand for cash has been elevated in Zimbabwe despite the over reliance on mobile money, most likely because money supply is low. The Monetary Policy Committee of the Zimbabwean central bank admits that the country’s “broad money supply of 4% is low compared to regional and international levels of 10% to 15%”.

In a  separate report, the reserve bank says “cash-based transaction values increased by 17.7%, to close at $1,046.71 million” for the month of August 2019. Transactions settled using bank cards were however also higher, rising by 20.5% to ZWL2.22 billion for the same month.

In EcoCash’s absence this weekend, the newly introduced bank notes will find more takers and users but as has been the case over the years, they may not be enough, with even more shoppers and users likely to be stranded. There is even more skepticism among economic analysts that the new notes will effectively help solve the financial crisis.

“We believe that the introduction of new notes will do little to alleviate (cash) shortages… cash withdrawals from banks have dried up due to severe shortages of physical cash, leaving the public reliant on mobile money agencies who are charging a premium. There is a growing risk that the government will revert to printing money to fund the fiscal deficit, a policy that contributed to hyperinflation in the 2000s,” said Nathan Hayes, an analyst at The Economist Intelligence Unit, on Wednesday.

Post published in: Business

Anti-riot police blocked public sector workers from marching to government offices on November 6 with a petition demanding better pay in Harare. Despite hyperinflation, wages in Zimbabwe have remained stagnant [File: Philimon Bulawayo/Reuters]

Zimbabwe is currently enduring power cuts of up to 18 hours a day as power generation remains greatly subdued due to a combination of drought, ageing equipment and lack of foreign currency to import power.

The country was on Wednesday producing 563 MW against demand of 1,200MW.

The drought experienced this year has severely reduced power generation at Kariba Hydro Power Station, one of the country’s main power plants.

The regulations, which shall not apply to existing premises with electrical geysers, are also meant to guide the installation, licensing, and operation of water heating systems that sue solar energy.

“No owner of the premises after the effective day of these regulations shall connect electrical geysers but may, at his or her own expense, install and use solar water heating systems,” the regulations said.

According to the regulations, all new buildings will have to be fitted with solar geysers and those who need electric geysers will need to apply for a special exemption.

The government said in 2018 the nation could save up to 280 megawatts of power through banning use of electric geysers.

Due to the prolonged power challenges, the government has been actively encouraging consumers to invest in alternative forms of energy such as solar but high solar installation costs are prohibiting many from doing so.

Post published in: Business