Good morning. Boies Schiller is telling top-billing associates to expect the "extraordinary" for bonuses as it faces a decline in its attorney headcount. Another Trump administration alum is headed to Jones Day, the FTC is taking Altria to trial today to unwind its Juul stake, the plaintiffs' firm Robbins Geller is facing a slapdown for what a judge called "reprehensible" false claims it made in a case, and GlaxoSmithKline is saying goodbye to 400-plus lawsuits alleging birth defects caused by the anti-nausea drug Zofran. Let's go!
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Boies Schiller pledges 'extra-extraordinary' bonuses amid retention woes
Boies Schiller Flexner is promising to award top-billing associates "extra-extraordinary" year-end bonuses, as the firm that litigator David Boies helped build grapples with not just partner defections but a decline in its junior lawyer ranks too.
Caroline Spiezio reports the firm's managing partners in a May 20 internal memo promised "extraordinary" year-end bonuses for associates on top of other bonuses if they passed a 2,350-hour annual threshold and "additional extra-extraordinary bonus" if they hit 2,600.
The pledge comes as Big Law is in a bonus-fueled battle for associate talent and as Boies Schiller faces associate departures. Its associate headcount has dropped nearly 25% from October to 58 as of Tuesday, according to data from its website. It's seen dozens of partners depart, including former co-managing partner Nicholas Gravante, who joined Cadwalader. Boies Schiller now has 168 lawyers, down from more than 300 in 2019.
The departures followed a leadership transition and fallout from David Boies' past representations of the disgraced movie producer Harvey Weinstein and failed blood diagnostics company Theranos. Its revenue fell last year 38% to $250 million, The American Lawyer reported.
The firm stands to profit, though, from its role in obtaining a $2.67 billion antitrust class action settlement with Blue Cross Blue Shield. Lawyers at Boies Schiller, Hausfeld, and other firms on Friday sought court approval for more than $667 million in fees and expenses. Learn more.
Industry buzz
- Hashim Mooppan, who as the former counselor to the solicitor general during the Trump administration defended the former president’s travel ban and argued against the constitutionality of the Consumer Financial Protection Bureau's structure, is returning to Jones Day. The firm has become a destination of sorts for many former Trump administration officials. (Reuters)
- The DOJ's Office of the Inspector General in a report released to BuzzFeed in response to a Freedom of Information Act request found that an assistant U.S. attorney "engaged in sexually harassing conduct" with multiple women. The prosecutor's name was redacted, though the report indicated he worked in the U.S. Attorney's Office for the Northern District of Ohio. (BuzzFeed)
- Massachusetts Attorney General Maura Healey, the first openly gay state attorney general, reflected in an interview on the work that needs to be done for LGBT+ advancement in government and discusses how far the nation has come, citing President Joe Biden's diverse administration. (CBS)
- The world's largest labor and employment firm, Littler, has brought on five attorneys from a now-dissolved Mexican boutique law firm Bufete Sales Boyoli. Shareholder Jorge Sales Boyoli, and associates Jesús Escárcega Martínez, Erik Daniel García Coronel and Valeria Cutipa Hernández will join the firm in Mexico City. (Littler)
- After Anthony Varona, the first Latino and openly gay dean of the University of Miami School of Law, was fired last week, the Society of American Law Teachers and the Association of American Law Schools’ Section on Minority Groups wrote letters decrying the move and raising concerns about whether it was motivated by bias. (Daily Business Review)
- Latham & Watkins, Kirkland & Ellis and Debevoise & Plimpton are steering private equity firms KKR & Co and Clayton Dubilier & Rice's $5.3 billion cash deal to take cloud data company Cloudera private. (Reuters)
- T. Andrew Brown, managing partner of Brown Hutchinson in Rochester is the newest president of the New York State Bar Association. One of Brown's top priorities will be creating a task force to map out what the legal profession looks like post-pandemic. (NYSBA)
What are the key challenges and opportunities facing legal departments in a post-pandemic world? Find out from leading GCs Amy Wilson at Dow, Ann Kappler at Prudential, Jennifer Zachary at Merck and Amy Tu at Tyson Foods on Thursday at 1 p.m. ET at our Reuters Events free webinar. Moderating the event is Reuters legal news editor David Bario. Sign up here.
Number of the day:
$2.5 billion
The U.S. Supreme Court on Tuesday declined to hear Johnson & Johnson's bid to overturn a $2.12 billion judgment won by 22 women who blamed their ovarian cancer on asbestos in the company's baby powder and other talc products. J&J said as a result, it would pay out $2.5 billion, which includes interest. J&J's lawyers, including Neal Katyal of Hogan Lovells and Joshua Rosenkranz of Orrick, had argued that a decision by a Missouri judge to consolidate disparate baby powder-related claims from the plaintiffs - including 17 women from outside the state - for a trial before a single jury violated its due process rights. A Missouri appellate court last year rejected J&J's bid to throw out the verdict but reduced the size of the judgment from the $4.69 billion originally awarded by a jury. "Decades of independent scientific evaluations confirm Johnson's Baby Powder is safe, does not contain asbestos, and does not cause cancer," J&J said. (Reuters)
Coming up today
- The full 6th Circuit will consider whether to uphold a decision barring Tennessee from enforcing a state law requiring a 48-hour waiting period for abortions. U.S. District Court Judge Bernard Friedman enjoined enforcement of the law last year, ruling in favor of a group of abortion clinics that had challenged it. A 6th Circuit panel refused to stay that injunction pending appeal in February. The court has now granted the state's petition for an en banc hearing of the appeal on the merits. Tennessee Associate Solicitor General Sarah Campbell will argue for the state and will face Autumn Katz of the Center for Reproductive Rights.
- The FTC will take Altria Group to trial before an administrative judge in its bid to force the company behind Marlboro cigarettes to sell its investment in e-cigarette maker Juul Labs. The regulator alleges that Altria's agreement in 2018 to take a 35% stake in Juul illegally suppressed competition. The FTC filed the case in the wake of widespread criticism that Juul's marketing of e-cigarettes helped fuel an epidemic of youth addiction. Jonathan Moses of Wachtell Lipton and David Gelfand of Cleary Gottlieb are defending Altria and Juul, respectively.
- The Florida Supreme Court will hear arguments in a case that could make it harder to sue tobacco companies in the state, where a major ruling in 2006 prompted thousands of lawsuits known as the “Engle progeny” against cigarette makers. The court will hear a case against R.J. Reynolds by the estate of a man who died of chronic obstructive pulmonary disease. A mid-level appeals court overturned a $6.4 million verdict for John Price’s estate, after finding that the jury should have been instructed that the estate, represented by lawyers at Morgan & Morgan, had to show Price relied on a specific misleading statement to his detriment. Marie Borlan of Hill Ward Henderson and Charles Morse of Jones Day are defending R.J. Reynolds.
- The 2nd Circuit in New York will consider whether to revive a lawsuit by a class of more than 100 janitorial workers in Connecticut who claim franchisor Jani-King International was actually their employer and unlawfully deducted franchising and supply fees from their pay. A judge found that the fees were legal because the workers signed contracts agreeing to pay them. The case is one of several accusing Jani-King and a top rival of misclassifying workers as franchisees rather than employees. Shannon Liss-Riordan of Lichten & Liss-Riordan and Aaron Van Oort of Faegre Drinker will argue for the workers and company, respectively.
- Former talc miner Cyprus Mines Corp will ask U.S. Bankruptcy Judge Laurie Selber Silverstein in Wilmington, Delaware to approve the appointment of a representative for people who may bring future talc-related claims in the company’s bankruptcy. Insurers represented by Tancred Schiavoni of O’Melveny & Myers have opposed Cyprus’ proposed candidate, citing potential conflicts. Kurt Gwynne of Reed Smith reps Cyprus.
- Alexion Pharmaceuticals will urge Vice Chancellor Morgan Zurn at the Delaware Court of Chancery to dismiss breach of contract claims brought by a group of shareholders who accused the company of failing to make milestone-related payments as part of its acquisition of rare disease-focused drugmaker Syntimmune. Arnold & Porter's Deborah Fishman is defending the company while Quinn Emanuel’s Andrew Berdonis is repping a representative of the former Syntimmune shareholders who filed the case.
"It should go unsaid (though, as this case demonstrates, apparently it cannot) that litigants and their counsel are expected to be candid and forthright when certifying information to the court"
U.S. District Judge Gary Brown, who sharply criticized Robbins Geller Rudman & Dowd for the "reprehensible" action of "falsely" claiming his court in New York's Long Island had jurisdiction over securities class actions against Greek shipping companies DryShips and Diana Containerships. The ruling marked the second bench slap for the prominent plaintiffs’ law firm in less than two weeks, after a Manhattan federal judge removed Robbins Geller from another case over what he called a "misleading" brief. The firm in a statement said it had “looked at venue from a broader, classwide perspective since that was the anticipated direction of the cases." (Reuters)
In the courts
- U.S. District Judge F. Dennis Saylor in Boston handed GlaxoSmithKline and its lawyers at Shook, Hardy & Bacon a major win by holding that 425 lawsuits by women alleging under state law that it failed to warn that taking the anti-nausea drug Zofran during pregnancy could cause birth defects were preempted by federal law. Saylor cited the FDA's recent decision to reject just such a warning for the drug, now owned by Novartis. (Reuters)
- The U.S. Supreme Court endorsed Native American tribal police powers, backing the authority of a tribal officer in Montana to stop and search a non-Native American motorist on a public road on reservation land. The justices ruled 9-0 against Joshua James Cooley in his effort to contest drug and weapons charges brought against him after a Crow tribal police officer found methamphetamine and firearms in his vehicle on reservation land in 2016. (Reuters)
- The justices also agreed to hear a copyright dispute between H&M and fabric maker Unicolors. H&M last year convinced the 9th Circuit to overturn a verdict finding it infringed a copyright for a fabric design, saying Unicolor’s copyright application contained inaccurate information. Unicolors' attorneys Josh Rosenkranz of Orrick and Scott Burroughs of Doniger/Burroughs in a statement argued that an "honest mistake" should not allow an infringer off the hook. (Reuters)
- SCOTUS also held that courts cannot assume that individuals seeking to avoid deportation are credible in the absence of a determination by an immigration judge or the Board of Immigration Appeals. Neal Katyal of Hogan Lovells and David Zimmer of Goodwin Procter represented the Chinese and Mexican nationals in the case, who argued for a more favorable standard for immigrants. (Reuters)
- New York Attorney General Letitia James filed a petition in state court seeking to force Eastman Kodak and its CEO James Continenza to turn over evidence and testimony ahead of an expected insider-trading case against them. The lawsuit is expected to focus on stock purchases that preceded an ill-fated deal in which the Trump administration would lend Kodak $765 million to back production of pharmaceutical components to help fight the COVID-19 pandemic. (New York Post)
- Amazon.com Inc recently changed its terms of service to allow customers to sue in court after plaintiffs’ lawyers filed more than 75,000 individual arbitration demands for Echo users, resulting in costly bills for filing fees it agreed to pay. Travis Lenkner of Keller Lenkner, whose firm filed the majority of the Amazon claims, told the Wall Street Journal that companies are now "seeing exactly what they bargained for" by relying on arbitration provisions. (WSJ)
- The 8th Circuit on a 2-1 vote ruled that a set of stringent air-pollution rules that regulate pollutants at coal-fired power plants do not extend to a nearby surface coal mine in central North Dakota operated by a unit of NACCO Industries whose production feeds that plant. Jeffery Ubersax of Kushner & Hamed and Derrick Braaten of Braaten Law Firm respectively represented the company and ranchers who had sued. (Reuters)
Industry moves
- Michael Tu, a securities litigator who advised media mogul Sumner Redstone on his battle over control of Viacom, has left Orrick to join Cooley as a partner in Los Angeles. (Reuters)
- Dave Stetson, former associate general counsel at Goldman Sachs, has joined Steptoe & Johnson as a partner in the firm’s international trade and regulatory compliance group in New York. (Reuters)
- Craig Godshall, who focuses his practice on structuring complex domestic and international transactions on behalf of private equity fund sponsors, has joined Winston & Strawn as a partner in its corporate practice from Dechert in New York. (Reuters)
- Jason Loden, a former partner at Thompson & Knight, has joined Baker Botts' executive compensation and benefits practice in the firm’s tax department in Dallas. The move comes ahead of Thompson & Knight's planned merger with Holland & Knight. (Reuters)
- Former prosecutor Andrey Spektor has joined Bryan Cave Leighton Paisner as a partner in the firm’s global litigation and investigations group. Spektor spent the past seven years as assistant U.S. attorney in Brooklyn. (Bryan Cave)
- Gordon Mak and Stanimir Kostov have joined Allen & Overy's U.S. leveraged finance practice as partners in New York. The pair joins from White & Case. (New York Law Journal)
- Scott Naturman has joined Hughes Hubbard & Reed as a corporate partner in the firm's New York office. Naturman joins from Covington & Burling. (Hughes Hubbard)
- Former Kirkland & Ellis partner Scott Cockerham has joined Orrick, Herrington & Sutcliffe as a partner in the firm's energy and infrastructure practice in D.C. (Orrick)
- Products liability litigator Janet Conigliaro is rejoining Dykema as a member of its Detroit office. She had practiced with the firm from 2012 to 2019 before serving as legal regulatory counsel at technology supplier ZF Group. (Dykema)
Columnist spotlight: SEC loses bid for Ripple legal documents in $1.38 billion XRP battle
The SEC claimed in May that it was entitled to see hundreds of privileged documents from the blockchain company because Ripple Labs had asserted a fair notice defense in its answer to the SEC complaint alleging the unregistered sale of XRP between 2008 and 2013. According to the SEC, Ripple essentially waived its privilege by claiming it had insufficient warning that its digital tokens could be considered a security. But as Alison Frankel reports, in yet another discovery ruling against the commission in this closely watched case, a federal magistrate judge in Manhattan sided with Ripple, holding that it didn’t waive privilege merely by arguing a fair notice defense. Find out how Ripple’s lawyers at Kellogg Huber and Debevoise persuaded the judge to see things their way.
Lawyer speak: Bayer's defense strategy comes down to strategic gamesmanship
With Bayer facing thousands of lawsuits claiming its popular weedkiller Roundup causes cancer, the company has been engaged in an "elaborate gambit" aimed at ending the litigation, University of Georgia School of Law professor Elizabeth Chamblee Burch writes in a new article. It has sought to manufacture a circuit split on the question of whether federal law preempts claims that it failed to warn weed exterminators about the risks of non-Hodgkin lymphoma. It had also sought to certify a class of future claimants, only to have U.S. District Judge Vince Chhabria last week reject the proposal. Read more.
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