Category: News Feeds

* A company run by Evel Knievel’s son is suing Disney because a character in Toy Story 4 allegedly resembles the late performer. Assuming Disney already has the license for Mr. Potato Head… [AP]

* A black British lawyer has received an apology after being mistaken as a criminal defendant instead of a lawyer multiple times in a single day. [New York Daily News]

* A New York attorney has been disbarred for sending “disturbing” emails to the New York City Bar Association and then failing to respond to ethics inquires. [New York Law Journal]

* A defamation lawsuit filed against Tucker Carlson by Karen McDougal, an alleged paramour of Donald Trump, has been dismissed. [Hill]

* A well-known immigration lawyer in Milwaukee, Wisconsin has been killed following an altercation with a bicyclist. [Milwaukee Journal Sentinel]

* An NCIS investigator has won a lawsuit for unpaid overtime pay. Since NCIS is entering its 18th season, everyone involved with that show probably deserves some overtime pay as well… [Bloomberg]

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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.

Ed. Note: Welcome to our daily feature Trivia Question of the Day!

Supreme Court hopeful Barbara Lagoa represented, pro bono, the interests of asylum seeker Elian Gonzalez while working at what Biglaw firm?

Hint: According to her disclosure form when she was nominated for the Eleventh Circuit, she still considers it one of the most important cases of her career.

See the answer on the next page.

No matter what side of the political spectrum, this will be an impactful election for attorneys – as private citizens and professionals – and their clients. Whichever way the election goes, attorneys in all practice areas are likely to see major changes in legislation, regulations, and enforcement. Are you prepared to advise your clients on their rights and responsibilities in 2021?

Starting next week, get ready to learn about some of the most important SCOTUS decisions from last term – with practical insights about their impact on your practice – and what might happen with the inevitable appointments during the next presidential term. In October, brush up on your campaign finance law to make sure your clients’ political donations stay compliant, whether they are nonprofits, small businesses, or major corporations. And don’t miss our immigration law coverage to keep up to date on the latest developments in a rapidly changing field.

Our unbiased, top-tier faculty are ready to help you keep serving your clients. Are you ready to keep up?

Want to get involved in the election more directly? Many states are encouraging attorneys to sign up as poll workers and election protection hotline volunteers (and some states will even give you CLE credit for doing it!).

Related Content:

1. Understanding Voting Rights & Litigation During the 2020 Pandemic Election Cycle
2. Business Leagues, Social Justice & Super PACs: Campaign Finance for 501(c)(4) & (c)(6) Nonprofits
3. Surveying the Impact of COVID-19 on Immigration Compliance

Another day, another firm that’s decided the time has come to do away with its austerity measures. In case you don’t remember, this spring, a slew of Biglaw firms introduced various cuts to combat the coronavirus crisis to make sure they’d be able to stay the course during the financial upheaval that was caused by COVID-19 across the globe.

Orrick — a firm that brought in $1,158,537,000 in 2019 gross revenue, placing in at No. 31 in the most recent Am Law 100 rankings — instituted a series of initiatives back in April that were meant to save cash on hand to prudently manage the firm and avoid any job loss. Specifically, the firm reduced salaries for all employees on a graduated scale. On the attorney side of things, career associates took a 5 percent cut, associates took a 10 percent cut, managing/senior associates and most of counsel took a 15 percent cut, and partners, of counsel, and executive staff took the deepest cuts of all. On the staff side, the most junior employees saw salary cuts of just 1 percent, while more senior staff members saw up to a 15 percent salary cuts. On top of those cuts, staff members whose roles depended on in-office activity were asked to work on reduced schedules while secretaries were asked to work four-day schedules. Last but not least, the firm postponed the start date of its 2020 associate class to January 2021.

Today, Orrick will be rolling back all of those salary cuts. This is what will be happening at the firm going forward in 2020, as of October 1:

• All associate, of counsel, and staff salaries impacted by COVID salary reductions will be restored to 100 percent prospectively;
• All staff moved to a reduced FTE (i.e., roles impacted by office closures) will be moved back to full-time;
• Equivalent adjustments will happen in Europe and Asia, including conducting postponed 2020 staff reviews; and
• Last but not least, the firm’s associate bonus program will at least match the 2019 scale.

Here’s a statement from Mitch Zuklie, Orrick’s chairman and chief executive officer:

Our entire team has worked very hard to support our clients throughout 2020 and deliver extraordinary results for them. We put a variety of cost management measures in place in March, at a time of uncertainty regarding how 2020 would unfold, in order to give us flexibility. It’s time to reverse some of that, express our gratitude to our associates and staff and recognize their relentless hard work. 

Sources we’ve heard from have expressed disappointment that the firm will not be handing out special fall bonuses, with some going so far as to say that morale at the firm is “cratering.” This is unfortunate, but others have told us that Orrick will at least “consider” the fact that other firms have made fall bonus payments to their associates when setting its year-end bonus scale.

If your firm or organization is slashing salaries or restoring previous cuts, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).

If you’d like to sign up for ATL’s Layoff Alerts, please scroll down and enter your email address in the box below this post. If you previously signed up for the layoff alerts, you don’t need to do anything. You’ll receive an email notification within minutes of each layoff, salary cut, or furlough announcement that we publish.

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

Another elite Biglaw firm has stepped out to join the COVID-19 bonus wars, and this time, it’s all about the hours. Let’s get this party started.

Over at Weil Gotshal, the more hours you’ve billed, the more money you’ll get. For all firms that came before this announcement, bonuses were simply based on associate class year. We’ll do a quick comparison of the bonus scales. Here’s an excerpt from a memo that was sent by Weil executive partner Barry Wolf (available in full on the next page), explaining why the firm is doing things this way, and what their bonus schedule looks like:

We recognize that, given varying client demand levels, the workloads taken on to meet the increased demand we have faced during this period were not equally shared.  To account for these differences, we will be paying the bonus out not by class year but by the schedule set forth below based on annualized hours worked during this calendar year (January 1 – August 31).

• Below 1800 hours – $10,000
• 1800-1999 hours – $20,000
• 2000-2299 hours – $30,000
• 2300-2599 hours – $40,000
• More than 2600 hours – $50,000

WOW, a $50,000 bonus — that sure sounds nice! Now, let’s take a look at the Davis Polk scale again, so we can see how things measure up:

• Class of 2019: $7,500
• Class of 2018: $10,000
• Class of 2017: $20,000
• Class of 2016: $27,500
• Class of 2015: $32,500
• Class of 2014: $37,000
• Class of 2013: $40,000

The most relevant question here seems to be, how many people at Weil will wind up worse off than they would if the firm had broken these bonuses down by class year? It’s incredibly easy to offer a $50K bonus when you know that only a few people will qualify for one. Thus far, we haven’t heard any complaints, so we’ll have to wait and see how things shake out.

UPDATE (4:25 p.m.): Hold that thought, because some people are not at all thrilled with these bonuses. “[P]artners have been telling associates to limit billing to clients and bill excess to nonbillable and have not been giving out billable work despite requests for it,” says one disappointed associate. Yikes. Here are some additional thoughts from another one of our sources at Weil:

[A]ssociates are not happy. After encouraging associates to take vacation in August, the firm cuts off annualizing hours are the end of that month. The joke is on you if you took that vacation! It is also a very odd way of doing things for a firm with “no hours requirement.” For a senior associate to make market, this memo imposes a minimum of 2,300 hours. Bankruptcy associates are maybe the only ones happy with this. Everyone else is pissed.

Perhaps most important of all, Wolf notes in his memo that this fall bonus “will not impact the year-end bonuses that will be paid in January 2021” and that those bonuses will be “at least equal to those paid in January 2020.”

Congratulations to everyone at Weil on their bonuses.

Please help us help you when it comes to bonus news at other firms. As soon as your firm’s bonus memo comes out, please email it to us (subject line: “[Firm Name] Bonus”) or text us (646-820-8477). Please include the memo if available. You can take a photo of the memo and send it via text or email if you don’t want to forward the original PDF or Word file.

And if you’d like to sign up for ATL’s Bonus Alerts, please scroll down and enter your email address in the box below this post. If you previously signed up for the bonus alerts, you don’t need to do anything. You’ll receive an email notification within minutes of each bonus announcement that we publish.

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

With 2020 unleashing horrible twists and turns upon America every day, it’s de rigueur to expect the unexpected. A worldwide pandemic? Raging wild fires? Locusts? Sure, why the hell not? But amidst all the bad news, 2020 has apparently brought us an unexpected return worth welcoming. Blue Cross Blue Shield has agreed to a $2.7 billion settlement that will, more importantly, bring injunctive relief that should trigger big changes to the health insurance market around the country. It’s 2020 and the Sherman Antitrust Act lives!

Technically the Act never went away, but surveying the landscape of American business one would be hard pressed to know it. Whether it’s a function of apathy or complicity, the government doesn’t bring antitrust cases with anywhere near the frequency that John Sherman would’ve envisioned.

And that’s a problem since mounting a viable private antitrust action is a mammoth undertaking. It’s a brutal, document intensive uphill slog. Once in a while a private action will pique the interest of the government who can come in and perform some heavy lifting, but if the government is going to look the other way it’s immensely difficult to keep a case going. Thankfully, some folks are willing to go out there and invest the time and effort to get the ball rolling.

The last big ticket antitrust case most of us can remember was the Microsoft case in the late-90s. So it brings us full circle to find David Boies, who prosecuted the Microsoft case as hired counsel for the government, at the heart of the BCBS case as well.

Over 30 defendants, some 50 firms, and over 1000 lawyers got into this. David Boies recounts that the first mediation on the settlement agreement required finding a room big enough to fit 100 lawyers and capable of providing everyone a microphone. He told me that some meetings in hotel ballrooms required abandoning the big table and placing all the lawyers in rows like a standard seminar. It’s been a wild seven years for this case.

“It was like a soap opera,” I said. “It was! It was,” Boies replied. “But also very high stakes. The amount of money is obviously substantial — and probably what the headlines will focus on — but the injunctive relief was even more important…. If we’d only gotten the money it would’ve been historic — one of largest antitrust awards and probably the largest without government involvement — but it would not have made nearly as much difference for our clients.”

The lawsuit began over seven years ago when Boies Schiller brought claims on behalf of insureds arguing that BCBS acted as a cartel in requiring insurance carriers within its network to agree to geographic non-compete clauses and cap the share of revenue they can make from selling non-BCBS products. In a nutshell, BSBS said one of its member carriers would act as, say, “BCBS of Alabama” and no other BCBS carrier was allowed to compete for businesses headquartered in Alabama. And there’s a certain logic to that from a trademark perspective, but the plaintiffs noted that the insurance agreements went further to say that a BCBS member from outside the jurisdiction couldn’t enter the Alabama market even to sell non-BCBS plans. The proposition was basically “if you want to sell the BCBS brand anywhere, you have to agree to never enter the market of any other BCBS brand… oh and on top of all that you can’t have more than a third of your revenue from other brands.”

The implications of something like this should be obvious. The market power of BCBS — which provides health insurance to almost a third of the country — would convince players to steer clear of competing in defined markets for fear of losing BCBS plans in their own territories and consequently driving up prices for consumers. When Boies first brought the case, BCBS responded by noting that they’ve been doing this for 30 years and the DOJ has never complained, deploying the classic “it can’t be illegal if I’ve never been caught” defense. But, as Boies said, “that’s not a legal defense, but it’s a powerful atmospheric: ‘If experts from the Justice Department didn’t bring this, then why would you believe these plaintiffs?’” It’s a mindset that makes pursuing these cases that much harder, especially for private actors, but the stakes in the health insurance market are too high to keep letting it slide. “This shouldn’t have been left to us to do. The government should have done this,” Boies said.

For whatever reason, the government didn’t. One reason might be the fact that the BCBS system covers many underserved communities around the country, allowing them to claim that their business model is necessary to provide health care to many. “We said, ‘we’re not trying to break you up, we’re just saying you can’t use this as excuse not to compete,’” Boies told me. BCBS is made up of a number of separate companies forming a network to provide a unified product. “That’s obviously a good thing. But they said they wouldn’t compete with even different trademarks. In our view, that’s a per se unlawful restraint.” It’s also an argument that doesn’t make much sense. If competing in that area with a non-BCBS product wasn’t profitable then they wouldn’t compete there and nothing would change.

Even assuming the settlement is approved by all the defendant member companies and Judge David Proctor — who you may remember scolded the parties to the case via GIF in one of this saga’s lighter moments — the case goes on for BCBS. The Boies clients were the insureds arguing that the BCBS model artificially drove up prices, but the other half of the consolidated case came from health providers arguing that the model allowed BCBS to exert improperly inflated leverage in negotiations with providers. It made for a weird marriage at times with both groups working in concert to prove the existence of antitrust behavior, while fundamentally conflicting on the recovery. After all, the existence of a national BCBS product created by the network actually helps the insureds keep premiums down. Basically one side said the behavior kept prices too high and the other said it kept them too low — an unusual spot for cooperating counsel to find themselves in. The provider claims are ongoing.

Working on one case for over seven years can be a serious grind. We overuse the Bleak House reference sometimes but when you’re in a room discussing settlement with over 100 attorneys it’s hard not to jump to the Dickens classic. But for the insureds represented by Boies Schiller, this case may soon be over and the impact that the injunctive relief will have on the health insurance market should be monumental.

Blue Health Insurers Reach Tentative Antitrust Settlement for $2.7 Billion [Wall Street Journal]

Earlier: Federal Judge Vents Frustration In GIF Form

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Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

ASG LegalTech, the company that owns cloud practice management platforms PracticePanther, Bill4Time and MerusCase, has acquired Headnote, the online payments platform that provides e-payments and accounts-receivable management for law firms.

At the same time, ASG LegalTech is announcing the first fruit of this acquisition — a fully integrated, all-in-one payment system within the PracticePanther platform called PantherPayments.

In an exclusive interview for my LawNext podcast, the CEO of ASG LegalTech, Soumya Nettimi, and the cofounder and CEO of Headnote, Sarah Schaaf, sat down with me to discuss the acquisition and what it means for the two companies and their customers. You can listen to our conversation above.

The acquisition is the fourth in three years for ASG LegalTech and the 28th for its parent company Alpine SG (ASG), a portfolio company of the San Francisco private equity firm Alpine Investors. ASG acquired Bill4Time in 2017 and PracticePanther in March 2018.

In February 2019, it merged the two companies to create a unified legal technology business, ASG LegalTech, and a month later, it acquired another practice management company, Merus Inc., developer of MerusCase. Today, the company says, it serves more than 30,000 lawyers and law firms across the world.

Schaaf, a former practicing attorney, founded Headnote in 2016 together with Thornton Schaaf, who is head of product at Headnote, and Matt Crampton, Headnote’s chief technology officer.

She will join ASG LegalTech as general manager of payments, where she will lead payments-related initiatives across the company’s portfolio. The other two founders will also remain, along with all other Headnote employees.

Headnote sought to distinguish itself from other payment products for lawyers through a mix of features that ensured compliance with bar and IOLTA requirements while charging the lowest fees in the legal industry.

For more on Headnote, see: LawNext Episode 17: Headnote Founder Sarah Schaaf on Simplifying How Lawyers Get Paid.

One-Stop Shop

In our LawNext interview, Nettimi said that two factors drove her company to want to acquire a payments platform. One is that their philosophy is to serve as a one-stop shop so customers do not have to find different products for the various functions and tasks they need to do to manage their firms.

The other is that they try to listen to their customers about what they need, and in this year of the pandemic, “where getting paid is synonymous with staying in business for many of our firms,” customers wanted a solution that would help them increase both collection rates and speed of collection.

As they considered whether to build a payments platform or acquire an existing technology, they decided to buy Headnote after concluding it was the “best payment offering” in the legal market, Nettimi said. Headnote is “the most modern and compliant technology available” and is “a disruptor in the market and has features that no one else has, like cutting-edge analytics, instant e-check, and a seamless onboarding experience.”

What she is most excited about, Nettimi said, is that they plan to use Headnote’s technology to build a fully native payment solution within each of their practice management platforms. “So what this means is customers will have a seamless experience already built into their current workflows, so they never have to leave their practice management system in order to manage their payments.”

As for Schaaf, she said that she and her cofounders were attracted to the deal by the potential it offered to bring the value of their product to a wider audience. “We really feel like our technology makes a big difference [to lawyers] in how they practice and how their business can grow,” she said.

Partnering with ASG LegalTech, Schaaf believed, offered the best way to do that because of the exemplary platforms they already had and their vision of delivering to their customers a one-stop set of integrated solutions. By doing that, she said, they would be able to bring more value to users and also have the ability to layer on more features to help users with more of their back-end processes.

PantherPayments

With today’s announcement of its acquisition of Headnote, ASG LegalTech is also announcing the launch of PantherPayments, an all-in-one payment system that is fully integrated within the PracticePanther platform.

Eventually, the company will roll out similar integrations in its Bill4Time and MerusCase platforms, both of which remain separate, standalone products.

The company says that PantherPayment’s features include:

• Full compliance with IOLTA, ABA, and lawyers’ online payment rules in all 50 states, as well as with payment card industry standards.
• Low, simple and transparent pricing of 2.8% for all credit cards and 1% for same-day e-check payments, with no monthly membership fees or variable rates.
• Fast payments, with clients paying invoices up to 70% faster than average and with more payment options than other processors.
• Integration with the PracticePanther platform, eliminating the need for dealing with multiple systems or vendors and providing a single source for support questions.
• Strong security, with SHA-256 data encryption, cloud-based hosting, and tokenized payments.

“They’re never going to have to leave PracticePanther,” Nettimi said. “It’s not an integration, like many other integrations that exist out there for payments and for many other areas. They’re going to be able to do everything in their PracticePanther app — from request payments, to logging them, to analytics, to refunds if they need to do that, to tracking things. … Simplistically, that’s what makes it so different than what is already out there.”

Headnote Continues

Even as these integrations are rolled out, Headnote will remain a standalone product, continuing to serve its existing customers and welcoming new customers, Schaaf said.

Customers will benefit from even stronger support and further infrastructure development, she said.

Bottom Line

When many of the practice management platforms available today first came to market, electronic payments were an afterthought, as they were not yet in wide use among law firms. But today, that has changed, especially in the era of the coronavirus crisis. Firms and clients alike expect the convenience of paying invoices electronically.

Even so, some practice management products rely on third-party payment platforms rather than offer a fully integrated option within their own platform. That can be clumsy and inconvenient in some cases and result in incompatibility for some functions.

For customers of any of ASG LegalTech’s practice management products, bringing Headnote into the fold should be welcome news. It has developed a reputation as a trusted and easy-to-use payment platform with transparent and straightforward pricing. Having that technology directly integrated into a practice management platform will no doubt prove to be convenient and useful for customers.

As for customers of Headnote’s standalone product, they should benefit from the fact that ASG LegalTech is a larger company that will be able to provide ongoing support and development, with the resources to do so at even a higher level than before.

For these reasons, the acquisition appears to be a good move for all concerned. For the two companies they seem to be a good fit in terms of their products and cultures, and Headnote’s technology fills an important need for ASG LegalTech’s customers. For customers, whether of ASG LegalTech or Headnote, the acquisition should result in an overall better product for them.

It was said that Ruth wanted to be an opera virtuoso but became a rock star instead. But she chose the law. Subjected to discrimination in law school and the job market because she was a woman, Ruth would grow to become the leading advocate fighting such discrimination in court. She was not an opera star but she found her stage right behind me, in our courtroom. There, she won famous victories that helped move our nation closer to equal justice under law to the extent that women are now a majority in law schools, not simply a handful. Later, she became a star on the bench, where she sat for 27 years. Her 483 majority, concurring, and dissenting opinions will steer the court for decades.

— Chief Justice John Roberts, offering recognition to the pop-culture icon that the late Justice Ruth Bader Ginsburg had become in her elder years, as he eulogized the departed colleague at the Supreme Court. May her memory be a blessing.

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.