Category: News Feeds

Whatever the precise facts of Citigroup’s sending the better part of a billion dollars to a group of hedge fund creditors of one of its clients—and those facts are very much in legal dispute at the moment—it’s pretty clear that the bank screwed up royally. Whether this mistake is the sort that would allow Citi to compel those hedge funds to give the money back, a matter about which the judge overseeing the aforementioned litigation is a bit dubious, it’s safe to say that the transfer was in some degree unintentional. For one, banks don’t usually pay client creditors with the banks’ own money. For another, they don’t usually pay creditors of financially-distressed companies in full three years early without some indication in advance, and indeed usually wait for a court order when they’re sued about it—not simply the initial court filing. For yet another, payments such as these tend to happen on specific, recurring days of the month, and not just whenever. Finally, Citi admits it fucked up—although exactly how it’s frankly not yet sure—an admission of incompetence gigantic financial institutions are not generally eager to make and a reputational blemish they’re not usually keen on displaying so loudly and publicly.

* Three New Hampshire hospitals are suing Vermont over Medicaid reimbursements. Maybe they’ll accept payment in maple syrup… [Keene Sentinel]

* The Kansas Supreme Court has ordered a suspended attorney to serve a 30-day jail sentence for practicing law while his license was revoked. [Kansas City Star]

* The Justice Department is asking to defend President Trump in a defamation lawsuit over sexual assault allegations. [CNN]

* An Iowa lawyer has been suspended from practice for accepting a settlement offer that his client rejected. [Bloomberg Law]

* President Trump is expected to announce a new list of potential Supreme Court picks as soon as today. The former reality show host should know some interesting ways to make the announcement… [Guardian]

---

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!

According to data collected by Law.com, how many hours did the average U.S. attorney spend on pro bono matters in 2019?

Hint: It compares favorably to the international standard, which is a measly 22.6 hours a year on average.

See the answer on the next page.

Postmaster General Louis DeJoy should thank God every day for the statute of limitations. Without a five-year cutoff, he’d be staring down a tidal wave of legal trouble for what appears to be fifteen years of pressuring employees to make political contributions and reimbursing them via company bonuses.

“Louis was a national fundraiser for the Republican Party. He asked employees for money. We gave him the money, and then he reciprocated by giving us big bonuses,” DeJoy’s longtime director of human resources at New Breed Logistics, David Young, told the Washington Post. “When we got our bonuses, let’s just say they were bigger, they exceeded expectations — and that covered the tax and everything else.”

That’s not exactly what DeJoy told congress last month when Rep. Jim Cooper (D-TN) asked him about possible campaign finance violations.

“That’s an outrageous claim, sir, and I resent it,” DeJoy huffed angrily. “What are you accusing me of?”

Which is … not a denial.

In an extraordinarily well-reported story, five former New Breed employees confirmed to the Post that DeJoy would solicit them for contributions to Republican politicians, send division managers around to ask employees for money, send his personal secretary to collect checks at the office, and then gross up bonuses to cover the contributions plus the tax liability on the money earned.

Another former employee acquainted with company payroll practices said DeJoy personally told staff which employees should get the bonus enhancement.

“He would ask employees to make contributions at the same time that he would say, ‘I’ll get it back to you down the road,’” the source told the Post. Which would be the classic definition of a straw man scheme and illegal use of corporate funds for campaign contributions.

And since campaign contributions are a matter of public record, the Post was able to document ample evidence of checks from New Breed employees exceeding $1 million between 2000 and 2014 when DeJoy sold the company. Most of those employees significantly curtailed their giving or ended it altogether after the company was sold.

And if the Post was able to unearth all this dirt just by digging around, a U.S. Attorney with subpoena power could probably come up with some unpleasant stuff. Well, she could if the statute hadn’t already tolled.

Unluckily for DeJoy, North Carolina has no statute of limitations on campaign finance crimes, and North Carolina Attorney General Josh Stein has vowed to investigate the allegations against DeJoy, as has the House Oversight Committee.

As for DeJoy, he’s issued a statement congratulating himself for “encourag[ing] employees and family members to be active in their communities, schools, churches, civic groups, sporting events and the politics that governs our nation” and providing them with “various volunteer opportunities to get involved in activities that a family member or employee might feel was important or enjoyable.” He claims to have consulted with the former General Counsel of the FEC to ensure compliance with election law and “regrets if any employee felt uncomfortable for any reason.”

Which is … also not a denial. But with a five-year lookback, he’s already home free anyway.

Louis DeJoy’s rise as GOP fundraiser was powered by contributions from company workers who were later reimbursed, former employees say [WaPo]

---

Elizabeth Dye lives in Baltimore where she writes about law and politics.

One usually associates the term “guardian” with the death of a parent. When an individual dies with a minor child, a court must authorize a guardian to act on the minor’s behalf until she reaches the age of majority. In some jurisdictions, a guardian, or conservator, may also refer to an individual or entity who is charged with acting on behalf of one who is deemed incapacitated. It is also possible that a guardian be appointed for a child, while her parents are alive, but are suffering a disability or setback that renders them unable to care for the minor.

In August, comedy icon Carol Burnett, at the age of 87, together with her husband, Brian Miller, has petitioned a Los Angeles Superior Court for temporary guardianship of her grandson, Dylan, son of Burnett’s daughter, Erin Hamilton. Their application has been granted, and they will remain temporary guardians of their grandson through Jan. 8, 2021. The impetus for the proceeding was Dylan’s parents’ ongoing struggles with substance abuse. Hamilton has been in and out of rehab for several years, afflicted with substance abuse. Tony West, the child’s father, has reportedly checked himself into rehab and as such is unable to provide care. The record for the matter reveals a Department of Children and Family Services investigation and juvenile dependency proceedings.

As temporary guardians, Burnett and Miller will oversee the general welfare of their grandson. This means that they may choose education, make health care and financial decisions and manage his residency and day-to-day activities. Upon the parent(s)’ recovery, a court can terminate the guardianship. If the disability persists, so too can the guardianship.

In cases of a death, a last will and testament states a testator’s choice of  guardian for his minor children. A last will also nominates a trustee to manage the minor’s assets. Many jurisdictions additionally provide the legal framework for the appointment of a standby guardian which permits immediate control to pass to the standby guardian who has no powers until a triggering event occurs. In cases of an incapacitated or gravely ill parent, the transfer of guardianship can happen quickly and with little to no court intervention. Of course, the appointment of a standby guardian takes foresight. In cases where an emergency arises, such as parents who fall ill, a petition must be made to the court, such as Burnett has pursued.

One  of the legal trends of COVID-19 has been the execution of last wills and testaments by families in order to provide for their children in the event of death. Many who work on the front lines have also executed standby guardian documents. In some states, orders have been enacted making standby guardian appointments easier to effectuate. For example, in New York, following the pandemic, an executive order permitted an individual to  appoint a standby guardian if the parent/guardian worked or volunteered in a healthcare facility or reasonably believed that they may otherwise be exposed to COVID-19.

Burnett’s appointment as temporary guardian is especially noteworthy because of her age. She is 87 years old, and her husband is 64. Many clients veer away from appointing an older generation as guardian, for fear of disability or illness, rendering the grandparents unable to serve. On the other hand, many grandparents make excellent choices for guardians because they are financially comfortable, retired, and feel a familial if not parental obligation to care for their own grandchild in a time of distress. Of course, being monetarily comfortable makes it easier  to be a guardian in the event a  grandparent opts to hire assistance such as a nanny or a tutor when raising young children.

Interestingly, Burnett herself grew up with her grandmother, Mabel Eudora White, moving in with her in Hollywood after her parents divorced. She eventually studied theatre at UCLA and became one of the most successful and influential comedic actresses of all time, shining on both stage and screen. She is likely most famous for her 1970s comedy sketch program, The Carol Burnett Show, which birthed and coddled many comic treasures, including the sit-com, appropriately named, Mama’s Family. Having won and been nominated for a multitude of Peabody, Emmy, Golden Globe, and Grammy awards, Burnett is also the namesake of the Hollywood Foreign Press Association’s Carol Burnett Award, for outstanding contributions to television. She has also received the Kennedy Center’s Mark Twain prize for American Humor. Having achieved all of this and more, at 87, it looks like Grandma raised her well.

---

Cori A. Robinson is a solo practitioner having founded Cori A. Robinson PLLC, a New York and New Jersey law firm, in 2017. For more than a decade Cori has focused her law practice on trusts and estates and elder law including estate and Medicaid planning, probate and administration, estate litigation, and guardianships. She can be reached at cori@robinsonestatelaw.com.

Last week, a ruling out of the Seventh Circuit presented the latest example that this country is facing an increasingly theocratic judiciary seeking to expressly favor religion and religious citizens at the great expense of nonbelievers. To be clear, the case is only at the preliminary injunction stage, so the Seventh Circuit panel was not making a decision on the merits. However, where the panel did make legal conclusions, they were downright alarming. For example, Judge Diane Wood declared that the court is convinced “that the speech that accompanies religious exercise has a privileged position under the First Amendment.” If your alarm bells went off at the mention of a “privileged position” within the First Amendment just wait, because somehow this opinion gets even worse:

We conclude by explaining that a comparison between ordinary speech (including political speech, which all agree lies at the core of the First Amendment) and the speech aspect of religious activity reveals something more than an “apples to apples” matching. What we see instead is “speech” being compared to “speech plus,” where the “plus” is the protection that the First Amendment guarantees to religious exercise.

Declaring that religious expression is entitled to some special, privileged status within the First Amendment that is superior to political speech is incredibly difficult to justify. For one thing, the free speech law that I thought we were all operating under, seems pretty clear that unless it is determining whether certain speech falls into a narrowly defined list of historical exceptions, government is not supposed to be in the business of making viewpoint or content-based restrictions. Yet, if courts are granting better treatment to expressive gatherings simply because they contain religious speech than other expressive gatherings such as political ones, this would seem to be a pretty clear-cut case of content-based restriction. Furthermore, there is a long line of cases that contradict this supposed special status of religious speech where the Supreme Court has declared that religious speech and nonreligious must be treated equally.

The decision by this Seventh Circuit panel, however, is just one of several high-profile pandemic restriction cases involving religious gatherings. As I wrote about before, the argument used in a California case that church gatherings must be regulated in the same way as dissimilar activities such as commercial retail, was rightly rejected. Although another case out of Nevada was much more complicated, the fact that the church was arguing for the court to adopt a standard of impermissible religious discrimination that is facially easier to satisfy than racial discrimination should be viewed as a major flaw. Moreover, the other problem with the argument used by the church in Nevada that churches and casinos should be treated the same was, as the district court repeatedly said, any comparison of the state’s regulatory regime when it came to churches and casinos revealed that the state was much more “intrusive and expansive” with casinos.

Although churches have repeatedly lost these pandemic cases, however, it is important to point out that no court ruled against a church based on the premise that secular gatherings were in possession of some special or enhanced constitutional protection that religious ones were not entitled to. Therefore, whatever you think about the cases where the churches lost, none should be viewed as more alarming than the Seventh Circuit opinion which declared the Constitution favors religious gatherings and expression more than secular ones.

Of course, no one should be surprised with the Seventh Circuit panel either. The myth that this country was conceived as a religious (Judeo-Christian) exceptional country has long been accepted as fact by wide swaths of the population. I see the most recent iteration of this myth being trotted out time and again in the form of a quote taken from a speech given by John Adams declaring that: “Our Constitution was made only for a moral and religious People. It is wholly inadequate to the government of any other.”

The “thing” about this quote though, is nothing in the Constitution’s text supports such a view. In fact, given that the original Constitution prohibits requiring a religious oath to hold office, Adams’ view directly contradicts the plain language of the document (See U.S. CONST. art. VI, § 1, cl. 3: “[N]o religious Test shall ever be required as a Qualification to any Office or public Trust under the United States”). In practical terms, expressly prohibiting a religious test for office amounts to a direct statement that government cannot favor religion. It takes a massive, unsubstantiated leap therefore, and in direct contradiction to plain language, to argue that our government was made only for religious people, or that it may favor religion over nonreligion.

The bottom line is, even if your intentions are not malicious, granting special favor in the law to religion or trotting out inaccurate quotes that claim our government was only intended for religious people in a modern society where nonbelievers make up an ever increasing share of the population is damaging. The Constitution is a document wholly adequate to govern believers and nonbelievers, alike to the mutual benefit of both. But it cannot function that way as long as those who operate it insist, wrongly, that the document favors them, to the exclusion of others who do not share their religious beliefs.

---

Tyler Broker’s work has been published in the Gonzaga Law Review, the Albany Law Review, and is forthcoming in the University of Memphis Law Review. Feel free to email him or follow him on Twitter to discuss his column.

As with last week’s interviewee, this week’s spotlight will be on another great example of lawyers identifying a market need and starting a business to meet that need. We are fortunate this week to have the opportunity to discuss another unique New York-based firm meeting a defined market niche, the recently opened litigation funding consultancy Avenue 33 LLC, with its founder, Rebecca Berrebi. Some background on both Avenue 33 and Rebecca to start.

First, a brief introduction to Avenue 33. As provided by Rebecca, “Avenue 33 (www.avenue33llc.com) is a consultancy that provides litigation finance expertise and insight to litigants, law firms, investors, and other stakeholders. From deal structuring, case and relationship management, all the way through to enforcement and monetization, Avenue 33 assists its clients [to] maximize the value of their litigation funding transactions. Avenue 33 is also available to usher new entrants into the market by providing guidance backed by extensive industry, business, and legal experience.”

As for Rebecca herself, her background and credentials are right on target for the work that Avenue 33 performs. She has worked in the business of litigation finance since 2016. Prior to founding Avenue 33, she was the head of corporate affairs at a leading litigation/arbitration fund manager with over $2 billion AUM, overseeing dozens of actual and potential cross-border, complex litigation and arbitration finance transactions. Rebecca has also served on several boards and committees of companies undergoing claims, including as the co-chair of the board of directors of Eco Oro Minerals Corp. (CSE: EOM).  In addition to her litigation finance experience, Rebecca has also worked in communications and politics, and she has practiced law. After graduating from Duke University, she worked in the political affairs and public relations industry at Edelman and a U.S. national political campaign. Upon obtaining her law degree from Benjamin N. Cardozo School of Law, Rebecca practiced as a private equity M&A lawyer at Kirkland & Ellis LLC and in the legal group of a global private equity fund.

As usual, I have added some brief commentary to Rebecca’s answer below but have otherwise presented her answer to my first question as she provided it.

GK: 1) Your background as a practicing lawyer with both Biglaw and litigation funder experience is formidable. What makes you most optimistic as you launch Avenue 33?

RB: Thank you, Gaston! My past experience as both a transactional lawyer and the head of corporate affairs at a dispute funding firm gives me a unique perspective on the litigation finance industry. Each litigation finance matter has at least three main stakeholders — the litigant, the investor, and the law firm — who may all want to see a big win, but whose individual incentives differ. I have seen firsthand how a well-drafted contract, mutual understanding among the parties, plus efficient management of a case can lead to significant success for everyone involved. Unfortunately, I also know that often litigants, funders, and lawyers come to the table with a different understanding of the purpose and use of funding, leading to wasted time, friction, and loss of value. I am optimistic that my clients can benefit from using my corporate legal background and litigation finance industry knowledge to level the playing field, so that all stakeholders can fully appreciate the risks and benefits of each given opportunity, leading to properly valued transactions, smoother relationships throughout a case, and maximized outcomes.

GK: As someone whose practice includes client-work related to litigation finance, I can testify firsthand for the need for Rebecca’s services. For one, it is sometimes lost on people in the maelstrom of seeking funding that the end result of all the diligence and effort will be the establishment of a contractual relationship — and a complicated one at that.

Moreover, getting the contract right is just the first step in the process of getting to a successful result, with all stakeholders needing to both live up to their end of the bargain in terms of the financial deal while also fighting to win the litigation itself. Having someone with Rebecca’s very apt and particular skill set involved in the process can only help keep things moving in the right direction, allowing each party to the transaction to focus on doing what they do best, whether that be writing the checks or arguing at trial. It is important to remember the inherently risky nature of litigation finance — for all parties, despite the sometimes rosy marketing employed by litigation funders looking for investment opportunities — and having an experienced hand involved in the process can only help a particular deal’s chances of success. In fact, anyone who brings someone of Rebecca’s caliber to the table would be sending a strong signal that they intend to do their utmost to get to a successful result, with full expectation that the counterparties will do the same. Put another way, when circumstances allow, I’d rather be the one with Avenue 33 on my side in a deal, rather than having to go it alone.

Next week, I will conclude my interview with Rebecca, focusing on how she sees the litigation funding space continue to evolve, as a result of both more regulation and more money at stake.

Please feel free to send comments or questions to me at gkroub@kskiplaw.com or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome.

---

Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique, and Markman Advisors LLC, a leading consultancy on patent issues for the investment community. Gaston’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.

I have $300,000 in loans, and I have no idea how I’ll start paying them off. I can’t work, so I can’t get health insurance. The whole time I was sick I was like, “What if I have to go to the hospital again?” People plan their lives around this exam. Now, on top of the stress of the pandemic, we’re unable to make money. Every single day I’m panicking.

— Jena Speiser, a 2020 graduate of NYU School of Law, in comments given to the New York Times related to what she’s suffering through in her attempts to take the bar exam during a pandemic. Speiser planned to apply to take the Massachusetts exam after being encouraged by the New York State Bar Asssociation to take the test in another state due to the unlikelihood of an in-person New York exam in July. She then fell ill with the coronavirus and was bedridden for weeks and later hospitalized, which caused her to miss the deadline to apply for New York’s online October exam. Speiser won’t be able to take the New York bar exam until February 2021, and has started babysitting in an attempt to earn money to repay her loans.

---

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.

The ABA Journal reports that the South Carolina courts have disbarred attorney Jacob Leon Parrott based upon a history of sexual misconduct including indecent exposure and voyeurism.

The disbarment order, entered on August 12 but publicly reported over the weekend, is retroactive to his 2018 arrest for “indecent exposure for exposing his genitals and masturbating in public.”

The South Carolina Supreme Court cited two matters involving similar behavior in Parrott’s disciplinary history. In 1997, he was suspended for four months after he entered an Alford plea to a charge of simple assault and battery for pulling down a woman’s bathing suit three years earlier. The court also noted that he was previously accused of trying to pull off another woman’s bikini bottom in 1989 but was not prosecuted for that offense.

He was also previously suspended over upskirt photos and failing to report that arrest to professional licensing authorities.

It’s hard to believe that someone like this could have ever practiced law — it’s almost as if the bar exam and protecting the public from bad lawyers aren’t connected in any way. Weird.

(Check out the opinion on the next page.)

Lawyer is disbarred after history of indecent exposure, voyeurism [ABA Journal]

---

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.