Category: News Feeds

The trigger for a sudden surge in prices came last month, when the US dollar was abandoned as legal tender, 10 years after Zimbabwe ditched its worthless local currency and dollarised as inflation hit 89.7-sextillion percent – that’s 20 zeroes.

The same ruling party is at the helm now as 10 years ago, noted Godfrey Kanyenze of the Labour and Economic Research Unit of Zimbabwe, a trade union-linked think tank. And that has added to the worries, he said, because few people trust it has the ability to steer the country out of the current mess – in which a third of the rural population is struggling to cover basic food needs.

Zimbabwe already faces a range of humanitarian concerns, with the UN and international aid groups filling gaps in food security, health and HIV care, water and sanitation, and social protection for vulnerable citizens.

“This is management by crisis,” Kanyenze told The New Humanitarian. The government is “pushing a mantra of ‘austerity for prosperity’, but it’s a government without a human face and it’s just knee-jerk reactions.”

The government says the decision to return to a single, Zimbabwean, currency is crucial to stabilising the economy.

John Kazingizi sells fruit and vegetables with his wife in Hatcliffe market, a high-density suburb of Harare. “What worries me most is prices keep increasing and my sales keep going down, as people are no longer buying as they used to,” he told TNH last week.

The couple struggle to find the money to buy a little fresh stock each day and meet their basic household costs – including repayments on a debt they took out to cover school fees for their five children. “We just need our economy to work again,” said Kazingizi.

The Zimbabwe Coalition on Debt and Development, a social and economic justice NGO, has argued that banning the US dollar and all foreign currencies will simply boost the black market.

“There is a need to address the root causes of the current currency crisis, which are rampant corruption, mismanagement of public finances, and impunity being enjoyed by those that are fuelling the crisis through arbitrage and resource haemorrhage,” the NGO noted in a press statement.

The central bank’s move has not put an end to strike threats, which likely helped prompt the government’s currency decision last month. The Zimbabwe Congress of Trade Unions is warning it will call a stayaway to protest the rising cost of living, although it has not yet set a date.

When the unions last led a work stoppage in January, following the sudden announcement of a fuel price increase of 150 percent, security forces shot dead 17 people and raped 17 women, according to Human Rights Watch.

Fuel prices have been hiked three-more times since January, with an average daily commute now costing as much as $20.

More of the same

President Emmerson Mnangagwa’s cash-strapped government had long insisted the Zimbabwe dollar would only be re-introduced when the economic fundamentals were right.

Yet with inflation almost hitting 175 percent for June, 18-hour power cuts, and 3.5 million people facing drought-induced hunger in the countryside, “the fundamentals are clearly out of whack,” noted Mike Chipere-Ngazimbi, economics researcher at South Africa’s University of Pretoria.

A disastrous harvest – with maize production just 45 percent of last season – has compounded the hardships. The World Food Programme aims to reach 1.2 million people with food aid, but by March next year an estimated 5.5 million will be unsure where their next meal will come from.

When Mnangagwa came to power 18 months ago after a military coup ended the 30-year reign of President Robert Mugabe, he promised reforms.

But Mnangagwa, a ruling party stalwart, has failed to deliver a programme attractive enough to investors or multilateral financial institutions, or win over a country shocked by the army’s violent enforcement of last year’s close-run election result.

The one bright spot in Zimbabwe’s recent economic history was a period of coalition government between Mugabe’s ZANU-PF and the opposition Movement for Democratic Change lasting from 2009-2013. Then, GDP growth ramped up to more than 9 percent – although overall poverty levels remained stubbornly high.

To rescue the country from hyperinflation, in which prices doubled almost daily, an early decision in 2009 did away with the Zimbabwe dollar in favour of a basket of foreign currencies. The downside was foreign currency shortages in an import-dependent economy where more dollars leave the country than arrive.

Since then, an ever-more creative series of currency policies have been put in place to address that problem.

Currency conundrums

In 2016, the government introduced bond notes and coins, supposedly worth the same as the US dollar. But they steadily lost value on the informal market – and became an immediate source of arbitrage profits for the well-connected.

The Mnangagwa government has encouraged adopting mobile money to reduce the need for physical cash. According to the reserve bank, mobile money was used for 85 percent of all retail transactions in the last quarter of 2018.

But high transaction fees and a 2 percent government tax makes mobile money expensive – further eroding people’s purchasing power. In the rural areas, where mobile money is the common payment system for livestock sales, people are turning to barter instead, according to FEWS NET, the USAID-funded early warning hunger monitor.

In February, as a step towards creating a local currency, the government introduced the Real Time Gross Settlement dollar, or RTGS – effectively a digital currency harmonising bond notes, mobile money, and debit cards tied to an official US dollar exchange rate.

Immediately, the RTGS dollar began to lose value on the parallel market.

“The economic situation makes us feel like orphans in our own country.”

Last month, the RTGS dollar was trading on the streets at about 13 to the US dollar, more than double the official interbank rate.

On 24 June, the government abruptly decreed that the country’s sole legal tender was the RTGS, renamed the Zimbabwe dollar, and abolished the use of multiple currencies. The aim was to end the informal market contributing to galloping inflation and restore government control over monetary policy.

Civil servants had been threatening to strike, demanding payment in US dollars, and there were reports the military was also unhappy with their RTGS denominated pay packets.

But the introduction of the Zimbabwe dollar has not halted its slide on the black market, and soon after the ban on the use of foreign currencies was announced, Finance Minister Mthuli Ncube said the tourist destination of Victoria Falls was exempted.

“It’s very clear the decision to move to a local currency was done in haste,” said Kanyenze of the labour think tank. “The economy was re-dollarising, and particularly the military were demanding to be paid in dollars.”

Kazingizi, the fruit and vegetable seller, said he sees little sign that things will improve any time soon. His wife gets up every day at 3 am to go to the market, he said, but the family still struggles to stay afloat.

“The economic situation makes us feel like orphans in our own country,” he told TNH.

Post published in: Business

* The DOJ sent a newsletter to the nation’s immigration judges including links to a white nationalist website. Bill Barr is running a real crackerjack organization. [Buzzfeed News]

* A deep question and answer exchange with Penn Law’s Amy Wax and she comes off just as loony as you’d expect. [New Yorker]

* It looks like Michael Avenatti is going to put Nike on trial in his upcoming extortion suit. [Law360]

* A Brad Pitt role holds the key to being a good prosecutor. It’s not Tyler Durden and that’s a little surprising. [ABA Journal]

* Weil Gotshal may have cost investment bankers millions, leaving them mere multimillionaires. [NY Post]

* Ed Whelan seems to have no idea how law review articles are written in this tortured effort to defend Trump circuit appointee Steve Menashi’s reputation. Essentially, Whelan says because Menashi’s controversial article was cited by real academics it must be real scholarship — as opposed to a 2L randomly inserting Menashi into a string cite. [National Review]

* Nicholas Sparks won that fight he’s been having with the former headmaster of his vanity school. [Deadline]

The delayed publication relates to complex accounting issues stemming from its JSE-listed parent company’s re-statement of financials following a forensic probe.

The Tongaat unit, which was supposed to have released its results for the period to March 31, 2019, missed its June 2019 deadline but asked for an extension to July 31, which it again failed to meet and applied to the ZSE to be allowed a second extension to August 14.

It missed that deadline again.

“The Zimbabwe Stock Exchange advises members of the investing public that it has put a halt in the trading of Hippo Valley Estates Limited’s (“Hippo”) shares on the ZSE according to Clause 4.13.2 of the ZSE Trading Rules and Procedures.

“This development has been necessitated by a formal request made by Hippo for the suspension of trading in its securities after it failed to publish its audited financial statements for the year ended 31 March 2019 as per the previous public notices,” the ZSE said.

ZSE has now formally requested the Securities and Exchange Commission of Zimbabwe (SECZim) to consider the application for the suspension in terms of the Securities and Exchange Act.

Investors will be advised of the determination by SECZim as soon as it becomes available, ZSE said.

Post published in: Business

This is the second invitation to investors in one week after CAAZ on Aug. 15 also invited investors in airport agribusiness to bid for the development and operation of horticulture facilities at its biggest port of entry, the Robert Gabriel Mugabe International Airport.

In the invitation issued Thursday, CAAZ said it was offering commercial space at the Robert Gabriel Mugabe International Airport, the Joshua Mqabuko Nkomo International Airport in Bulawayo and the Victoria Falls International Airport for the development of lounges.

The offer is open to both local and foreign companies and is on a lease and concession basis.

“Interested companies or investors should provide information demonstrating that they have the required experience, competencies, skills and qualifications relevant for performance of the services whether as individual firms, joint ventures or consortia,” CAAZ said.

With regards to the development of about 300 hectares surrounding the Robert Gabriel Mugabe International Airport just outside Harare, CAAZ said the project entailed the development of a horticulture growing facility, complete with pack-houses and all associated cold-chain infrastructure for export out of the airport.

The successful bidder will be expected to enter into a lease and concession agreement with CAAZ for an agreed term.

China Jiangsu International is currently upgrading the airport into a more modern facility at a cost of 153 million U.S. dollars.

The three year project will boost the airport’s annual passenger handling capacity to six million from the current 2.5 million, hence the need for the provision of the running of lounges.

Post published in: Business

“I’m totally disgusted & alarmed by an unprecedented trend of abductions in our country,” Shingi Munyeza, who is also an entrepreneur and cleric, said on Twitter.

Expressing “worry” that Harare had yet to put forward a strategy against the alleged incidents, Munyeza said the government must “protect its citizens” and hold perpetrators responsible.

The remarks followed several reports in recent weeks of abductions and torture, the most recent case being that of female satirist Samantha Kureya.

Kureya was taken Wednesday night by masked gunmen who attacked her family’s home in the capital Harare, the All Africa news website reported.

She has in the past criticized in her performances the police ban on popular protests against political and economic policies.

Kureya was found later after having been severely beaten, news reports said.

When asked for comment, Deputy Minister of Information Energy Mutodi told Anadolu Agency that the incident was “just another comedy”.

Among other recent victims were union leader Obert Masaraure, human rights activist Tatenda Mombeyarara and several others, according to the local pindula news website.

Protests in Harare

“The abductions are a reflection of the state’s paranoia with the recent demonstrations that took place in Harare. The state is showing its power against a hapless citizenry,” Owen Dliwayo, an independent political analyst in Zimbabwe, told Anadolu Agency Thursday.

Dliwayo accused the government of acting in a “ruthless” manner against dissent as well as those it deemed as acting “contrary to its narrative.”

“From a rights-based approach, it is disheartening to note that the so-called second republic is intolerable to different views in violation of the civil and political rights of the common people. The government has failed to promote the common good of our society but instead has become a menace,” he said.

Earlier this month, Zimbabwe’s main opposition, the Movement for Democratic Change (MDC) called off plans for street protest, after a top court upheld police ban on demonstrations.

The protest has been the first in a series planned by the MDC against the country’s deteriorating economic and political situation.

Despite police warnings and a court ban, crowds swarmed Harare’s streets, where they were confronted by police teargas and batons.

Post published in: News

Tinotenda Madyira, a 31-year-old illegal immigrant, was booked into Coconino County Jail for one count of identity theft and one count of attempted theft, both felonies. He was also charged with providing false information to Police, a misdemeanor.

According to Page Police, “The investigation revealed Madyira went to the UPS sorting facility in Page and attempted to take possession of a package containing numerous cell phones that had been ordered by fraudulent means, using a local nonprofit organization’s shipping information. When contacted by police, Madyira provided a name and forged identification card that were not his own.”

Madyira was booked as “Jacob Daniel Smith.” Police soon discovered Madyira’s real identity with a fingerprint match. The suspect was moved to the Coconino County Jail in Flagstaff. According to Page Police, it is unclear at this point if U.S. Immigration and Customs Enforcement will step in, leaving the possibility that his alleged crimes in Page will not make it to the Coconino County courts.

A Chronicle investigation discovered Madyira, then 25 years old, was arrested and convicted in 2013 for a similar crime in Cincinnati, Ohio. He pleaded guilty and was sentenced to 12 months and one day for selling a list of stolen identities to a Zimbabwe crime ring.

The ring used stolen identities to obtain at least $5 million in fraudulent tax refunds.

A March 7, 2013, press release from the Department of Justice, U.S. Attorney’s Office in Southern District of Ohio stated, “In early 2012, the Secret Service and IRS began investigating a large ring of individuals around the Cincinnati community who were using stolen identities to file fraudulent income tax returns and then steal the fraudulent tax refunds. Members of the ring purchased stolen identities for thousands of actual taxpayers through illicit online forums and from accomplices. The undisputed head of the scheme was Kudzaiishe Marimbire, the brother of Tawanda Marimbire. Most of the stolen funds were laundered and sent to Zimbabwe.”

Government agents seized numerous luxury cars, computers and tax documents. They also found more than $1 million in cash and money orders in a storage locker used by the Marimbire ring. Kudzaiishe Marimbire, along with others in the gang, fled to Zimbabwe. Tawanda Marimbire was arrested attempting to cross the Canadian border with $76,000 in cash.

U.S. Attorney Stewart said in 2013, “This case is a perfect example of the emerging problem with tax refunds obtained through the use of stolen identities.”

IRS Criminal Investigation Special Agent in Charge Kathy A. Enstrom said, “Individuals who commit refund fraud and identity theft of this magnitude and with this degree of trickery, dishonesty and deceit, deserve to be punished to the fullest extent of the law.”

Madyira only served part of his 2013 sentence and was released early for good behavior and put on probation. At some point, he went off the radar after failing to report to ICE.

The Chronicle learned from a law enforcement official of an effort to deport Tinotenda Madyira in 2014. The move was thwarted by a judge. Over six years later, Madyira, still in the U.S. illegally, is arrested in Page.

Little is known about Tinotenda Madyira’s activities, or what names he might have used before his 2013 arrest and the years leading up to his arrest in Page. His last documented address was in Escondido, California.

In June 2017, he received a traffic citation in the Phoenix area. Maricopa County court records show he didn’t have a valid driver’s license. He never showed up for his court date.

Little is known about the Zimbabwe men who got away, or how many more like them are operating in this country today.

The Movement for Democratic Change (MDC), which accuses President Emmerson Mnangagwa’s government of repression and economic mismanagement, called a demonstration last Friday as the start of a nationwide protest movement but it was banned by the police.

But some opposition supporters still turned up for the protest and were subsequently dispersed by police who used batons, teargas and water cannon.

Amos Chibaya, the MDC national organizing secretary and convener of the planned protests, was questioned by police and detained in a cell overnight, lawyer Obey Shava told Reuters. Chibaya is expected to appear in court on Friday.

“The police are saying he failed to take proper steps to stop a demonstration. They have refused to let him go so he has been locked up,” Shava said.

Separately, Chibaya is facing trial on subversion charges linked to violent protests in January that prompted an army crackdown that led to the deaths of more than a dozen people.

Police spokesman Paul Nyathi could not immediately comment on Chibaya’s detention.

Other protests that were planned by the MDC in other cities this week were also halted by the police and courts. The party said hopes were fading that the government might become more tolerant of dissent than the one it had replaced.

The opposition said four more officials were abducted in the second city of Bulawayo from their homes by unknown armed men, following similar incidences in the capital reported by rights groups last week.

The government said in a statement that police were investigating a report of a female comedian who was kidnapped and assaulted by unknown armed men on Wednesday night. The comedian has been critical of the government and police in her skits.

Post published in: Featured

An elaborate scheme involving a fake college set up in New Jersey by ICE has, unsurprisingly, resulted in a lawsuit by some of the foreign students swept up in the sting operation. Apparently having given up on rooting out the worst of the worst non-citizens, ICE is contenting itself with arresting and charging foreigners for attempting to stay in the country legally by continuing their education.

The fake university looked pretty real to applicants. It had a website, a Facebook page, and — most importantly — accreditation by a national accreditation service. The school’s website told students the fake school was certified by the DHS’s Student and Exchange Visitor Program to “educate international students.”

It all looked legit. None of it was. ICE claims it was targeting people who defrauded students or universities by brokering illegitimate educational offerings meant to allow visitors to overstay their visas. That doesn’t explain why ICE accepted registration fees from interested students. Nor why it arrested a bunch of students trying to do something they were legally allowed to do.

ICE ended up with about eight criminal suspects from the hundred-plus arrests resulting from the sting operation. Some of the others caught up in the sting had their visas cancelled, supposedly due to “fraudulent enrollment.” So, in the government’s eyes, the people ICE tricked into enrolling in its very real-looking fake college are every bit as criminal as the criminals the government is actually prosecuting.

The lawsuit deals with these suddenly-cancelled visas. The issue is the government’s arbitrary decision to turn people they first referred to as “victims” into accused criminals solely for the purpose of stripping them of their visas. This determination comes without any form of due process attached, so it’s up to federal courts to field these challenges, as the Appeals Court points out.

The Appeals Court delves into administrative minutia to counter the government’s arguments and point out where the lower court went wrong. But it also spends some time dealing with the government’s contradictory assertions. After sending letters calling the duped students “frauds,” the government argued in court it didn’t actually mean what it said in the letters informing the students they were no longer welcome in this country. From the decision [PDF]:

We held argument on September 25, 2018. There, for the first time, the Government informed this Court that its position was not that the students had committed fraud by enrolling in UNNJ. Rather, the Government believed that the students were the victims of fraud. The Government twice stated that the students “were caught up in it in the sense that they were victim by the academic recruiters” and that “[t]here was no fraud here. These students, as far as we are concerned, were the victims of fraud. . . . [T]hey were caught up in it.”

[thinking face emoji]

How does the government explain calling victims of fraud perpetrators of fraud when revoking their visa privileges? In a word, badly.

When pressed about the language in the terminating letter, the Government (incorrectly) stated that “fraudulent enrollment” was “passive voice,” and therefore should not be read to imply that the students had committed fraud.

That’s a very fine — and very understated — parenthetical there.

And it just keeps getting better. The government comes off as a petulant child who has decided only one thing will make it happy — tossing these students out of the country — and will do whatever it takes to ensure that happens.

Despite the Government’s position that the students were the victims of fraud, it acknowledged that database entries for each student would reflect the “fraudulent enrollment” determination made by DHS. The Government acknowledged that it was able to, consistent with its stated position, eliminate any database notations that suggested that the students had committed fraud, yet it refused to do so.

Beautiful. And that’s followed immediately by another line of pure horseshit, delivered directly to bench by the government’s lawyers.

It argued that correcting the record on a preventive basis was not necessary because the “fraudulent enrollment” determination would not have any adverse impact on the students in future immigration proceedings.

Ah, yes. Being accused of criminal acts by federal agencies tends to have no effect on the accused, especially during removal proceedings or the visa application process.

After all this “no harm, no foul” stuff, delivered in hopes of persuading the judge the government wasn’t just a tantrum-throwing child wearing its dad’s suit, the government decided to embrace its inner child.

On October 12, 2018, the Government changed course yet again. It filed a letter “to clear up any confusion from certain exchanges” that occurred during argument. The Government informed the Court that it was not, in fact, conceding “that all—or even most—UNNJ enrollees were innocent victims.” In fact, the Government now asserted that some of the students “in all likelihood, knew that their academic recruiters were committing visa fraud” and others even “conspired with their academic recruiters to commit visa fraud.” “Thus,” the letter concluded, “to the extent that any of the Government’s comments at oral argument left the misimpression that all of UNNJ’s enrollees were innocent victims of the academic recruiters’ visa fraud scheme, that is not the case.”

After the discussion of the government’s argumentative fuckery, the court turns to the issue at hand. The lower court said the students needed to take their problems up with the immigration court and/or the DHS first before bringing it to the district court. The Appeals Court disagrees. The students can bring this action directly because the determination made by the DHS was indeed final. There are no intermediate steps these students could have taken to challenge the DHS’s determination.

The order terminating these students’ F-1 visas marked the consummation of the agency’s decision-making process, and is therefore a final order, for two reasons. First, there is no statutory or regulatory requirement that a student seek reinstatement after his or her F-1 visa has been terminated. Moreover, even if the students attempt to pursue the administrative procedures for reinstatement, there is no mechanism to review the propriety of the original termination order. Second, the students need not wait for removal proceedings to be instituted. As we stated in Pinho, an order’s finality cannot depend on the institution of removal procedures which may never occur. And in any event, immigration judges cannot review the original denial of reinstatement. They do not have that authority.

The court makes no statement on the propriety of the ICE’s sting operation. It does, however, spend a few pages detailing all the efforts ICE made to ensure the bogus college looked legitimate. The decision is subtly damning in its construction, contrasting the “realness” of the college with the government’s claim students it first called “victims” were now suddenly fraudsters. The lawsuit lives on, headed back to the lower court to give the plaintiffs a shot at getting the DHS’s “fraud” designation scrubbed from their permanent record.

Lawsuit Filed By Victims Of ICE’s Fake College Sting Revived By Appeals Court

North Carolina Appeals Court’s Second Take On Retaliatory Arrests Just As Bad As Its First One
Facebook’s Weird Pointless Auditless Audit Of Political Bias On Its Platform
WSJ Rightly Attacks Senator Josh Hawley’s ‘Nannyish’ Laws Regarding The Internet

With LeClairRyan’s dissolution a matter of public record, the battle to control the public narrative is officially underway. Rumors and explanations are proliferating, both publicly and behind closed doors, and many of them should probably be taken with a grain or three of salt. Businesses are complex, and their failures or successes are typically the confluence of dozens of decisions, strategies, and strokes of blind fate.

Two weeks ago, I listed a set of themes I thought would likely emerge in the wake of LeClairRyan’s meltdown. I’ve now had the opportunity to connect with former LeClairRyan partners to get a more crystalized view of what happened. Between this firsthand information and the ample public reporting on LeClairRyan’s demise, it appears that the firm’s leadership suffered from two fatal shortcomings: (i) an inability to make hard decisions, and (ii) a failure to monitor business fundamentals. I’ll do a more comprehensive piece about these points soon.

For now, I’d like to focus on one prediction I got wrong in a very unexpected way. Many law firms collapse due to a failure to anticipate market changes. And some of that was true at LeClairRyan, which evidently failed to monitor market trends in compensation, overhead reduction, and pricing. But ironically, part of LeClairRyan’s failure was the opposite of most firms — namely, anticipating an industry-wide sea change that never materialized.

The Big Bet

John Fitzpatrick, a former LeClairRyan partner with whom I spoke, explained that firm founder Gary LeClair bet big on the notion that the U.S. would follow in the footsteps of the U.K. in allowing outside, non-lawyer investment in legal services. This is consistent with recent Bloomberg Law reporting on the subject, which cites other former LeClairRyan partners who wished to remain anonymous.

Back in 2007, the United Kingdom adopted new rules loosening restrictions on the practice of law by non-attorneys. U.K. law firms can now, within certain restrictions, accept outside investment and share firm revenues and fees with non-attorneys. According to Fitzpatrick and the anonymous former partners cited in Bloomberg, LeClair built his firm’s strategy around the prediction that state bars in the U.S. would follow in the U.K.’s footsteps and loosen the unauthorized-practice-of-law and fee-sharing rules.

LeClair concocted an accounting and stock structure within the firm that allowed for the purchase of a preferred class of firm stock that paid an 8 percent return contingent on the firm making budget. In the short term, firm partners theoretically could invest, build up the firm’s capital reservoir, and have a comfortable long-term return on their investment. In the long term, once the rules governing firm investment loosened up, LeClairRyan would be instantly positioned to either accept massive waves of outside funds and grow itself into a superpower, or sell the firm and allow preferred shareholders to cash in. Sounds like a great plan, right?

But to quote famed business management guru Mike Tyson, everyone has a plan until they get punched in the mouth.

The U.K.-style loosening of firm ownership rules never made it across the pond. In the meantime, LeClair’s unique preferred stock structure exacerbated the firm’s other business problems. The partnership as a whole, with their common stock shares, were inherently at odds with the subset of partners holding preferred stock, since preferred stock got paid first before common stock once budget was met. Further, the preferred stock investments themselves evidently went to patching budget shortfalls, rather than growing the firm as they should have. Pair those with shrinking revenues and aggressive expansion costs, and you have a partnership class tearing itself apart at the seams.

The results speak for themselves. Gary LeClair gambled on a future that never came to pass, and the firm he founded is no more.

Nothing Ventured, Nothing Gained?

LeClair was wrong when it mattered, and it looks like he’s going to remain wrong for the foreseeable future. I wrote last year on the push by the California bar to change its version of the Unauthorized Practice of Law (UPL) and fee-sharing rules to follow a more U.K.-centric model allowing for outside investment. California doesn’t care much about opening up law firms to outside investment so much as it is trying to address a critical shortfall in available legal services to consumers. The average lawyer is vastly outside the price range of the average American, and many Californians cannot afford desperately needed legal services. Cracking up some of the bar’s traditional monopoly on those services would invite less-expensive, non-attorney service providers in to help these underserved populations.

The legal profession’s response to this proposal has been nothing short of a torrent of undying fury. Of the public comments received to date on the proposals to loosen the rules surrounding UPL in California, I count 14 in favor and 200 against. Only 1 out of 15 comments supported the changes. On loosening fee-sharing restrictions, it was 9 in favor, 48 against, a 5:1 margin against change. Absent bold action by the state bar in outright defiance of the will of its members, or intervention by a state legislature largely comprised of fellow lawyers, the legal monopoly in California will likely remain in place.

Skin In The Game

There are valid arguments against the U.K.-style loosening of the UPL and fee-sharing rules. Lawyers are traditionally entrusted with their clients’ most difficult, sensitive issues, and we’re governed by ethical rules and norms that ensure we keep our clients’ needs ahead of our own. Opening the market to non-attorneys without those safeguards could lead to abuse, especially among the poorest, who need those services the most. Are potentially unethical, predatory legal service providers better than no providers at all?

But let’s not kid ourselves: we lawyers have a deeply personal interest in keeping our monopoly in place, because it’s how we make our money. The market failure California is experiencing is exactly what one would expect a monopoly to create. Demand far exceeds the artificially restricted supply, and the bottom 90 percent are priced out while lawyers make out marvelously.

Also consider how the Big Four accounting firms are waiting in the wings, ready to pour infinite resources and personnel into a crack that might open up in our market. We’re facing financial headwinds as a profession even during an expanding market, and the bond yield curve just inverted; why would we give up one of the few structural advantages we have going in our favor? People don’t typically vote against their own paychecks. So long as lawyers remain in charge of their own UPL and fee-sharing rules, those rules are probably safe for another generation.

The Future Is When?

The legal monopoly is well protected, both at the state bar level and within state legislatures. It would take either a dramatic shift in bar leadership or a populist uprising in response to the serious shortfalls in the current supply of legal services to see those protections come to an end.

Gary LeClair bet wrong, but it remains to be seen whether it was the substance or timing of that bet that was off. The day may come when outside pressures grow substantial enough to push for a U.K.-style deregulation of the legal market. Or U.S. lawyers may stand firm in keeping our monopoly intact, for good and for bad.

Gary LeClair may yet prove to have been a prophet or a madman. Quite possibly, he’ll prove to have been both.

---

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.

Kureya previously told the BBC that she’d been banned from attending national events but that she was hopeful things would change

Samantha Kureya, known by her stage name “Gonyeti”, has been critical of the police and government in her skits.

She was taken from her home, beaten and forced to drink sewage before being dumped, her colleague says.

In Zimbabwe, comedians have historically found it difficult to make jokes about authority, fearing jail.

Police have not yet commented on her abduction.

Her brother, Jonathan Gasa, told the BBC that about six armed masked men stormed her home on Wednesday night, took her away, stripped and assaulted her.

He said they accused her of undermining the government with her skits.

She was found three hours later.

Her colleague Lucky Aaron told the BBC that she was dumped in “the bush” in the suburbs of Harare.

He said he picked her up and took her to the hospital for scans which confirmed no bones had been broken.

But he was still concerned for her health because she was forced to drink sewage, he added.

In a tweet, opposition Movement for Democratic Change (MDC) leader Nelson Chamisa called her abduction a “barbaric human rights violation”:

In February Kureya was one of two comedians arrested for public nuisance for wearing a uniform that resembled a police uniform in a skit, reports the BBC’s Shingai Nyoka from Harare.

At the time she was reportedly warned that her comedy was becoming too political.

Her abduction follows several recent cases of activists who were planning anti-government protests being abducted and tortured, human rights groups say.

The Zimbabwean authorities denied any involvement in those abductions.

They have not yet commented on the comedian’s abduction.

Kureya told the BBC in 2018 that her comedy company Bustop TV used to be banned from attending national events but since Robert Mugabe was ousted from power she hoped comedians would be allowed more freedom of expression.

Zimbabwean comics test the waters in post-Mugabe era

“I just hope in Zimbabwe we have the freedom to talk about the president without being in trouble, the freedom to talk about anyone without the police coming after you.”

“I just hope it will change, ” she said.

Post published in: Arts