The chaotic economic environment brought on by the coronavirus pandemic has led to a rise in distressed companies. Lenders and creditors face an unprecedented challenge of navigating a high volume of loans in distress.
Legal teams supporting lenders need to quickly asses best practices for dealing with these distressed loans, all while navigating tightening budgets and a hazy timeline for recovery.
Attend our webinar on August 26th at 1 p.m. ET / 10 a.m. PT and hear from our experts on workout, loan restructuring, and special assets management. They will share their combined knowledge on how to address this growing issue.
Discussion will focus on:
Managing challenges for business with high volumes of commercial loans amidst an economic crisis
Prioritizing key clients and handling deteriorating relationships
Supporting lending teams and special asset groups that are dealing with distressed commercial loans
Getting ahead of deteriorating loan portfolios, including loan forbearance drafting and management at scale
Addressing unique concerns, including preference litigation and real estate-specific challenges
Presenters: Marc Allon, Axiom Financial & Bankruptcy Lawyer Jack Lundstedt, Axiom Financial Restructuring & Commercial Contracts Lawyer
Moderator: David Feldman, Director of Solutions Marketing, Axiom
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Ruby Lenora Green worked in the Broward County Public Defender’s Office for 8 and a half years but her passion for the work goes back further. She spent two years in the Jacksonville Public Defender’s Office and before becoming an Assistant PD, she served as an investigator, volunteer, legal fellow, and legal intern. She was just elected president of the Broward Association of Criminal Defense Lawyers. Her entire professional life is about defending the poor, so it made sense when she ran for the post of 17th Judicial District Public Defender with long-time Public Defender Howard Finkelstein stepping down.
Finkelstein backed another Assistant Public Defender, Gordon Weekes, for the role. Last night’s election netted Weekes around 48 percent of the vote to Green’s 32 percent. That should mark the end of the campaign cycle and a return to the business of fighting in the trenches of criminal justice. Instead, Green was unceremoniously fired:
If this smacks of a wildly unprofessional retaliatory firing, that’s just because you have a basic sense of what wildly unprofessional retaliatory firings look like. It would still be inappropriate, but Finkelstein could have at least put together a genteel letter explaining that “in light of the election and the need for the new Public Defender to enjoy a clean slate yadda yadda yadda rival candidates would be getting several months to wrap up work.” That Finkelstein couldn’t put in the modest effort required to dress up his petty vengeance is astounding. You’d think a public defender would have thicker skin.
It was because of inappropriate, unprofessional and dishonest comments that she made about this office and its commitment to the underserved and people of color,” he said.
Paging Dr. Freud. Dr. Freud, you’re needed in the Projection Clinic.
While it’s true that Green’s campaign did criticize the current state of the office for flagging morale and high attorney turnover driven by training shortfalls and lack of management support, that isn’t so much a knock on the office’s “commitment” as its follow through. It’s also remarkably tame as campaigns go… Kamala Harris called Joe Biden a segregationist sympathizer, like, six months ago. There’s no other way to read this than a naked effort to chill criticism from within his office.
After a campaign focused on suspect management and an indifference to retaining experienced attorneys, firing a veteran attorney for raising the issue only seems to prove that point. Hopefully, the next Public Defender is capable of picking up on this.
A Florida attorney is facing a whole host of charges — felony fleeing and eluding police, felony drug possession, misdemeanor driving under the influence, refusing to accept a citation, and obstruction — after allegedly leading police on a high-speed chase. According to reports, when Reena Patel Sanders was eventually apprehended by authorities, she insisted they go for pizza. Of course, this happened in Florida.
As reported by the Miami Herald, Deputy Corbin Hradecky says he clocked Sanders going 80 mph in a 45 zone. According to Hradecky’s report, when he pulled up behind Sanders’s Lexus with his lights flashing, she sped up to 90 mph. Hradecky says a chase ensued until Sanders lost control of her car.
According to the police report, when apprehended, Sanders showed “several signs of impairment” and smelled of alcohol. Several pot-laced gummy worms were also found in a purse. The report also details Sanders’s belligerence when police arrested her:
“During the encounter, Reena was shouting obscenities at deputies and began to name off famous actors such as Dwayne the Rock Johnson, Owen Wilson and Ryan Reynolds,” Hradecky wrote. “When asked why she fled from me, Reena stated she was ‘scared.’”
Sanders also had a hankering for pizza, which she reportedly let the police know:
The deputies took Sanders to the Marathon sheriff’s office substation, where she asked when she would be going back to her hotel, according to the report.
“I advised Reena she was going to jail on a litany of charges. Reena insisted she was not going to jail and insisted we get pizza,” Hradecky said.
The police report also notes Sanders boasted about working at a “big law firm.” According to the ABA Journal, her Florida bar profile used to say she works at Kelley Kronenberg in Plantation, Florida (so, like Florida big, not like Biglaw big) but was later edited to remove that reference. Despite a 2017 press release announcing Sanders’s elevation to partner, she’s since been scrubbed from the firm’s website. The ABA Journal was also able to get a choice comment from Sanders:
When reached at the phone number listed by the Florida Bar, Sanders told the ABA Journal Tuesday morning that she just got out of jail in Key West, another city in the Florida Keys, and could comment later in the week.
When an ABA Journal reporter told Sanders that the story would run Tuesday, she replied, “My comment is just that I’m f- – -ing innocent. How about that?”
Sanders said she is a great litigator, and she knows how to get stuff done.
…. Sanders contacted the ABA Journal late Tuesday afternoon and left a voicemail saying she was sorry for failing to return our call. The ABA Journal did not leave a message Tuesday morning, however, because the woman thought to be Sanders had answered the phone.
Which is really the perfect ending to this bizarre story.
Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).
The recent announcement of Lexis+, the new premium research tool from LexisNexis, brought a bevy of new features under the Lexis umbrella from AI-driven brief analysis to flagging at risk opinions to unprecedented control over search term application. But the exciting development that received little fanfare was the launch itself. LexisNexis launched a major product — one that feels a bit like a whole new platform as opposed to a premium addition to Lexis Advance — in the midst of a pandemic.
Yeah, yeah. The wheels of progress are always turning and all that, but let’s take a second to take in what this effort entailed.
I had an opportunity to chat with LexisNexis VP of Product Management Jeffrey Pfeifer about developing a product under unprecedented conditions. Well, maybe not unprecedented. Allegedly the fortune cookie was invented in 1918, but the treat’s natural language prediction capabilities have always been suspect.
Unveiling a product in a pandemic is impressive enough, but putting together an offering for the legal sector presents more daunting challenges. “One of the things that’s unique in legal is that there’s a stronger tension between immediate usability and evolution of design,” Pfeifer explained. Anyone ever unfortunate enough to buy the initial version of a Microsoft product knows the sort of growing pains the consumer market deals with all the time. Updates and bug fixes eventually leave Microsoft customers with tools that are deservedly the market standard, but it’s a process. In “the biz” it’s called the minimum viable product, presumably because MVP sounds like a good thing as opposed to an engraved invitation to constant updates.
Legal, on the other hand, demands a product far closer to finished. Consumer products can use the MVP launch as an opportunity to generate — both good and not-so-good — feedback and adapt. “The nature of billable time and client deadlines means the iterative design approach hasn’t held as much as it does in other markets.” Indeed, Pfeifer explained that this is one of the problems with the legal tech market writ large as it’s a requirement directly at odds with innovation which depends on putting out works in progress and fixing them based on customer experiences. Startups, for example, don’t always have the same advantages as the big players when it comes to adapting to the legal model: “Everyone wants innovation in these markets but the market needs to look inward. It’s difficult with these other design expectations. It’s difficult to build to buttoned endstate first.”
This is why legal tech coverage tends to be one long tale of consolidation with promising IP scooped up by larger providers who have the resources to get it into the state attorneys demand.
So an MVP in legal requires a more polished product to meet the “viability” threshold of a lawyer. This was the challenge for LexisNexis: “Could we complete the process to refine all of the ideas to the degree we wanted to and meet the MVP concept and launch commercially in the market when most were working from home?”
Presenting another design challenge, of course, is what I call Office Space Syndrome:
Attorneys can have trouble communicating their needs to engineers, making it even more of a challenge. Even with ample pre-launch feedback, it’s hard to get it right in the initial release when engineers don’t have an ingrained understanding of what the lawyers are actually looking for. It’s a communication gap that industry mainstays like LexisNexis have invested a lot of time and effort in surmounting. Lexis, for example, has testing protocols to determine which audiences embrace particular features that may deliver useful feedback that the user might not even be able to vocalize. But if pre-launch feedback was an issue before, how exactly would a robust Beta test work during lockdown?
As it turns out, the global pandemic may have actually helped the design process. “Clients are more accessible… which is nice. They’re more interested in the process now too. It’s not clear why… the billing pressure and deadlines haven’t gone away. Social interaction maybe? Or maybe a personal investment now that they’re more reliant on tech.” These seem likely factors. The sudden reclamation of commuting time probably doesn’t hurt either.
Still, adopting an all-digital feedback system required adaptation. “It’s not about just taking the same techniques and shoving them into Zoom.” But the research team modified its approach and “what we found is the interaction experience worked well and we had better feedback than expected.”
Lexis+ is in the midst of its launch period now. It’s already in the law school market and has a planned September commercial release. And thanks to the efforts of the LexisNexis product development team, it’s going to be a polished product from day 1.
Last week, I wrote an article about how people shouldn’t think that starting a law firm is an easy solution for unemployment. I received some great emails from readers about the piece, including one message from an attorney who had a unique perspective. That lawyer related how many rural communities across the country do not have enough lawyers. The attorney conveyed that the number of lawyers who are involved in certain practice areas can be counted on one hand in some places and that many lawyers may wish to hang out a shingle in rural areas, since it would be easier to find legal work. While I think it is still risky to start a law firm as a solution to unemployment no matter where you intend to practice, that email got me thinking about how more people should seriously consider practicing law in more rural parts of the country.
Although I always liked the show Green Acres when it came on Nick at Night as a kid, I never seriously considered moving to the country to practice law. I have stayed in the New York City area for pretty much the entirety of my career, although I also have an office in the Jersey suburbs (but the office is still just 10 miles from Manhattan!). However, earlier in my career, I got a taste of what practicing law in rural areas might be like.
Before launching my own shop, I was a mass torts attorney at a law firm that frequently sent me on depositions across the East Coast. I spent around 70 nights a year in hotels, and I ate more meals in chain restaurants on the road than I care to remember. Many of the depositions I took were in very rural locations. Indeed, some of the areas I traveled to did not have any discernible cell phone reception (which was super scary when driving with GPS on my phone). I even saw a few “runaway truck” ramps on the side of the road in some rural areas, which was an extremely foreign concept to me before I made trips to rural areas in order to take depositions.
At many of the depositions I attended in rural areas, attorneys from more populated cities would also travel to take the testimony of the person we were deposing. However, numerous times, local counsel would attend the depositions. Many defendants realized that local counsel was cheaper than attorneys who came from bigger cities, and local counsel did not charge as much for travel time or costs as “big city” lawyers.
Oftentimes, all of the attorneys who were in a rural area to attend a deposition would meet up after the proceedings for dinner or any other mishigas we could find. Over the course of several years attending these depositions, I got to know some of these rural lawyers really well, and we often discussed how practicing law was different in the country than it was in major cities.
Attorneys in rural areas would often tell me about how courteous and civil the practice of law was in rural areas, and how there was less conflict among adversaries. These lawyers would tell me that attorneys got along with their counterparts a lot more in rural locations than they typically did in urban areas, and this made the practice of law much more easy-going in the country. As I can attest to from personal experience, practicing law in more populated areas can be extremely adversarial (often for no reason) and that can cause unnecessary aggravation, leading to a high level of stress (and probably blood pressure!). As such, many attorneys may prefer the more laid-back lifestyle of a country lawyer.
In addition, rural attorneys told me all the time how much further money went in rural communities, and many of these lawyers had mansions and huge plots of land by my more suburban standards. In fact, I knew one attorney who moved to a rural area for the express purpose of having land and saving money on housing costs. Even though that attorney had almost no land in the suburbs, he was able to afford a large house and had a ton of acreage in a rural area. The attorney even had a bunch of chickens that he used for eggs, which I always thought was a pretty cool benefit of country living!
Furthermore, rural lawyers are often much more able to get noticed in the legal and political communities of their area. Rural lawyers oftentimes have ample opportunities to be considered for judicial and political appointments and to be more civically involved. It is extremely difficult for a lawyer to stand out when there are thousands of attorneys in their area, but that is not the case when only a handful of attorneys practice law in a community.
In the end, people have known for some time that there is a higher demand for legal service in rural areas than in many cities. As a result, if you are thinking about having a fresh start and launching your own law firm, it might make sense to practice law in a rural area. You will possibly be more successful in finding legal work, and the lifestyle of a country lawyer may be appealing to many attorneys.
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.
A U.S. post office in lower Manhattan (Photo by David Lat)
The attacks on the post office by Donald Trump and his army of nouveau authoritarian Republican goons are based on only one thing: voter suppression. Like he always does, Trump said the quiet part out loud the other day, and made yet another public announcement that would have been an administration-ending scandal for anyone else had it been discovered in a secret email: Donald Trump said he is trying to deny funding to the Postal Service in hopes of stymieing its ability to make mail-in voting work during the election this fall.
In their other go-to strategy of “throw everything at the wall and see what sticks,” Trump and his allies have also claimed repeatedly that the Postal Service “is in a financially untenable position,” and that Trump’s postmaster general is only gutting the agency he was tapped to lead in an effort to “rein in expenses.” That is a lie. The current Postmaster General Louis DeJoy is a major Trump donor, is the first postmaster general in nearly two decades who was not a career Postal Service employee, and is trying to ruin the mail not because he gives a damn about expenses, but because Trump thinks keeping people’s votes from counting will help him win the election.
It’s sad. A bought-and-paid-for political hack sits in the office once occupied by Benjamin Franklin, who was appointed as America’s first postmaster general in 1775. And if you know your history, you know that means what we now know and love as the United States Postal Service predates both the Declaration of Independence and the U.S. Constitution.
But when the Founders did finally get around to effectuating our Constitution in 1789, they were sure to make room for what even people centuries ago considered an essential government service. Article I, Section 8, Clause 7 of the United States Constitution is known as the Postal Clause, and it gives Congress the power “To establish Post Offices and post Roads.”
Note that the Postal Power doesn’t include any caveats like “as long as the Postal Service generates enough revenue to cover its own expenses.” That’s a weird way to think of a government service — any government service. Imagine if we started cutting the military every time we called attention to the fact that it doesn’t generate a profit.
Nonetheless, the Postal Service has been the victim of decades-long attacks pertaining to its fiscal situation. This helps make the current postmaster general’s excuse for his actions sound a bit more plausible. The Postal Service has also been subjected to a lot of weird funding-related requirements by lawmakers over the years, like having to prefund its retiree health benefit payments. That is not required of any other public or private entity, and it actually worsens the current financial situation of the Postal Service.
The mail is a service that every American is using, has used, or will use at some point in the future. That can’t be said about many government services. Of course, the people mailing things should have to pay for delivery of their things, and yes, those payments should help offset the costs of the Postal Service. But the Postal Service is not a business, and it never was. The Postal Service has been integral to our democracy since before the founding of our democracy. It should not matter whether the post office generates a profit.
The Postal Service has fulfilled many roles since the birth of our nation. This year, hopefully, it will allow millions of us to vote safely without spreading COVID-19. But don’t buy the lies from the Trump administration about cuts and mail shutdowns being the result of a budgetary crisis. If we want a government service funded, all we have to do is fund it. The attacks on the Postal Service are really about voter disenfranchisement, and nothing else.
Jonathan Wolf is a litigation associate at a midsize, full-service Minnesota firm. He also teaches as an adjunct writing professor at Mitchell Hamline School of Law, has written for a wide variety of publications, and makes it both his business and his pleasure to be financially and scientifically literate. Any views he expresses are probably pure gold, but are nonetheless solely his own and should not be attributed to any organization with which he is affiliated. He wouldn’t want to share the credit anyway. He can be reached atjon_wolf@hotmail.com.
August is almost over, and thanks to the coronavirus crisis, Biglaw firms have had their fair share of summertime sadness over the austerity measures put in place to combat the economic downturn caused by COVID-19. After enduring salary cuts, furloughs, and layoffs, associates and staff at many Biglaw firms have been waiting for the day when their lives would return to normal. Months have passed, and some firms are now walking back their cuts.
About four months ago, Sheppard Mullin — a firm that placed 54th on the latest Am Law 100 ranking — conducted two rounds of austerity measures, first furloughing staff and later putting all of its employees’ salaries on the chopping block. If you recall, those cuts were 12 percent for associates, special counsel, and staff attorneys, while staff members making more than $90,000 had cuts of 10 percent and staff members making between $70,000 and $90,000 saw their salaries cut by 5 percent. The firm said the partner cuts would be at a “meaningfully greater percentage.”
Now, employees at Sheppard Mullin are finally receiving some good news on the salary front. Here’s an excerpt from a memo that was sent out earlier this week (available in full on the next page):
Because of our strong performance the Executive Committee is reducing by half the COVID-related compensation adjustments for Associates, Special Counsel, Staff Attorneys, and Staff that began in May. The 5% and 10% reductions absorbed by some of our staff will become 2½% and 5%, and the 12% reductions incurred by our Associates and most of our Staff Attorneys and Special Counsel will be reduced to 6%. The changes will all be effective the payroll period starting August 31, 2020, paid on September 18, 2020.
The new percentage reductions are scheduled to stay in effect through the end of 2020. The Executive Committee will continue to monitor our performance each month, and depending on results and our view of the pandemic’s impact on the future, sooner adjustments may be possible. As stated at the time of the reductions, our Partners have pledged to take the greatest burden on compensation during this COVID-affected business cycle.
We’re sure those impacted by the salary news at the firm must be thrilled –and wondering when their salaries will be fully restored. (On the flip side, all of the firm’s secretaries, except in Chicago and Washington, DC, will remain on its workshare program until the end of the year, and only two of the 51 employees who were furloughed have returned to work.)
Let’s hope more firms are able to roll back COVID-19 austerity measures.
(Flip to the next page to read the memo in full).
If your firm or organization is slashing salaries, 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).
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.
When the SEC last month announced plans to effectively cut the number of 13F disclosures of hedge fund stock holdings journalists have to play with from a few thousand to a few hundred, we thought of it more as an amusing little parting gift from Jay Clayton to his once and future clients than something to get really worked up about. After all, as even Jim Cramer knows, the usefulness of these filings is at best questionable. After all, by the time they are made—no later than 45 days after the end of a quarter—it’s highly unlikely that they offer an accurate picture of what a particular hedge fund owns at the moment of their release. Indeed, it’s entirely possible for a hedge fund to sell everything on the first day of the next quarter and build an entirely new portfolio containing none of its former holdings, making as stark as possible the fact of what a 13F is: a snapshot—and a very old one by the time of its disclosure at that—of what a hedge fund held at a specific, increasingly distant moment, with no bearing on what said fund is actually doing now, or has been doing for the last six weeks. Plus, let’s be honest: No one really cares much about what a hedge fund with less than $3.5 billion was doing a month-and-a-half ago, and so all of the celebrity portfolios you’d like a peek at will still be coming to you anyway. (That all being said, 13Fs are the only window the public gets into these things, and for all of their out-of-dateness Goldman Sachs has managed to build a pretty successful portfolio out of them.)
Well, we might not think that the proposal’s that big a deal, but other people do. Lots of them. And they have takes! Well, really, they have one take—that this change is bad—expressed in what may be a record number of comment letters on an SEC proposal, 1,500 and counting as of July 28, an average of almost 80 per day, with more than a month from now still to go in the comment period. We randomly clicked on a couple dozen of the ones that have been released and found not a single one in favor of the proposal: “What are you guys thinking?” “I am strongly concerned.” “The SEC’s contempt for the individual investor is obvious.” “This will only further the inequities in our society by removing valuable information access to smaller investors.” “This is madness, totally crazy.” “Keep the transparency going. PLEASE.” “PLEASE DO NO RAISE THE REPORTING LIMITS.” “When is less transparency and less data ever a good thing for the small investor?”
In the interest of transparency (our interest, of course, not the SEC’s: It clearly doesn’t have an interest in transparency), we should note that the far more diligent folks over at DealBook did manage to find at least one supportive letter to Jay.
Chad Gassaway, a chartered market technician, backed the proposal: “In no other industry are companies required to divulge their proprietary strategies.” He said the forms were already flawed, since they do not require institutional investors to disclose their debt holdings or short positions.
The comments didn’t only offer incredulity, hectoring, begging and all-caps ad hominem attacks. They also made some suggestions on how to improve the proposal, although Clayton probably wants to read those even less than the ones impugning his motives and integrity.
Instead of raising the disclosure threshold, some comments suggested shortening the filing window to 30 days after the end of a quarter, instead of the current 45, or requiring funds to disclose all of their investment positions, including short bets.
* A New York attorney, who billed himself as the “lottery lawyer,” is accused of swindling lottery winners out of millions. Hey, you never know…your attorney’s allegedly bilking you. [NBC News]
* The top employment lawyer at Target is going to be the new top attorney for Minneapolis. [Minneapolis Business Journal]
* A suspect in Florida walked out of a hospital just hours before he allegedly killed an Orlando-area attorney. [Fox News]
* A ton of states are suing the United States Postal Service over anticipated delays in mail delivery. [Bangor Daily News]
* A petition of certiorari has been filed at the Supreme Court for a copyright case involving Led Zepplin’s iconic song “Stairway to Heaven.” Hopefully the justices will demand a live performance. [Billboard]
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.
Kathryn Rubino is a Senior Editor at Above the Law, and host of 
Jordan Rothman is a partner of 
