Good morning. Today could be another big day in Britney Spears' conservatorship case, the SEC has unveiled its first charges in its probes into the SPAC merger craze, Elon Musk's brother is now on the witness stand in Delaware, and BakerHostetler's chairman is speaking out about why he thinks lawyer burnout accelerated during the pandemic. Chug that coffee down, we’ve got so much more news to get through!
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Fight over Britney Spears' conservatorship returns to court
The battle over Britney Spears' conservatorship is back in court today, the first time since the pop star denounced the 13-year arrangement as "abusive" in a headline-grabbing hearing in June.
Los Angeles Superior Court Judge Brenda Penny is expected to consider the singer's choice of a new lawyer to represent her. The judge will also consider whether to allow 24/7 security for the conservatorship's administrators, many of whom have been the targets of death threats in recent weeks as the public furor around Spears' situation snowballed, Jill Seargent reports.
Spears told Penny the conservatorship was preventing her from marrying again, or having more children – shocking revelations about the arrangement that put the spotlight on its leadership, which includes Spears' father, Jamie Spears. "My dad and anyone involved in this conservatorship and my management who played a key role in punishing - ma'am, they should be in jail," Spears told the judge.
In the wake of Spears' court appearance, her manager quit and her court-appointed attorney Samuel Ingham asked to resign, as did his co-counsel at Loeb & Loeb. The New York Times reported that Spears has held discussions with veteran Hollywood attorney Mathew Rosengart, now at Greenberg Traurig, about representing her. The firm declined to comment.
Despite her comments, Spears has not filed the paperwork to dissolve the conservatorship. But Spears' potential hiring of Rosengart could be a step in that direction. Learn more about today's happenings.
Industry buzz
- Russell Capone, who until recently served as counsel to Manhattan U.S. Attorney Audrey Strauss and who before that oversaw the prosecutions of Michael Cohen, Jeffrey Epstein and Michael Avenatti as the head of SDNY's public corruption unit, has joined Cooley as a partner. (Reuters)
- Human rights attorney Steven Donziger is onece again asking a Manhattan federal judge to release him from home confinement as he fights criminal charges related to his civil case against Chevron. Donziger, who is facing criminal contempt charges stemming from his decades-long fight with Chevron over claims of pollution in the Ecuadorian rainforest, says he has spent two years on home confinement and isn't a flight risk. (Reuters)
- President Joe Biden tapped Lisa Wang, a partner at Picard, Kentz & Rowe, as the administration’s nominee for assistant secretary for enforcement and compliance at the Department of Commerce. Before joining the firm, Wang was a senior attorney in the department's Office of the Chief Counsel for Trade Enforcement and Compliance and an assistant general counsel in the Office of the U.S. Trade Representative. (White House)
- Fish & Richardson named Kristine McKinney chief operating officer of the firm. McKinney has been with the firm since 2016, and previously served as its first chief legal talent and inclusion officer. She replaces Richard Anderson, who is stepping down after eight years. (Fish & Richardson)
- A team from Kasowitz Benson Torres is representing Quinn Emanuel as the firm asks a Manhattan federal judge to toss a racial discrimination lawsuit filed by a former IT director who says he was fired after years of harassment and mistreatment. The Kasowitz attorneys, who are known for defending a former Dentons managing director mired in a sexual misconduct suit, argued Quinn Emanuel fired Nicholas Mondelo over a glitchy software upgrade and not because of his race. (Reuters)
- The U.S. Senate confirmed Julie Su, California's labor secretary, as deputy secretary of labor, despite Republican criticism of her record handling California's unemployment insurance system during the COVID-19 pandemic. Su, a lawyer who had the backing of unions and liberal advocates, was confirmed in a 50-47 vote and will work alongside former Boston Mayor Marty Walsh, who is secretary of labor. (Reuters)
Number of the day:
$8,040,000
The SEC has been busy investigating Wall Street's SPAC merger frenzy and on Tuesday brought one of its first major cases. The regulator charged blank-check company Stable Road Acquisition Corp, space exploration company Momentus Inc and two executives with misleading investors about its technology and its former CEO's national securities risks ahead of their planned $700 million merger. Stable Road and its chief executive, Brian Kabot, through Daniel Chaudoin of Kirkland & Ellis negotiated a combined $1.04 million in settlements, while Momentus, represented by Robert Stern of Orrick, agreed to pay $7 million. The SEC said it will move forward with its fraud case in D.C. against former Momentus CEO Mikhail Kokorich, a Russian citizen. His lawyer, Thomas Gorman at Dorsey & Whitney, called the SEC's claims "unfortunate." (Reuters)
Coming up today
- Elon Musk's brother Kimbal, a Tesla director, is expected to return to the witness stand in the ongoing trial before Delaware Vice Chancellor Joseph Slights concerning the electric vehicle maker's $2.6 billion purchase of SolarCity in 2016. Shareholders repped by lawyers at Robbins Geller, Kessler Topaz and Grant & Eisenhofer accuse Elon Musk of strong-arming Tesla's board to buy SolarCity just as it was about to run out of cash. The celebrity CEO, who is repped by Cravath's Evan Chesler, defended the deal during testimony on Tuesday. See what he said while on the stand.
- Puerto Rico's financial oversight board will resume a hearing before U.S. District Judge Laura Taylor Swain on its request to begin soliciting creditor votes for its proposed plan to restructure $120 billion in debt. Lawyers at Milbank and Butler Snowe, representing two bond insurers that opposed the request, said during a hearing on Tuesday they were continuing negotiations with the board and would either return with a deal or to present their objections today. The board, represented by Martin Bienenstock of Proskauer Rose, already resolved one major obstacle to its proposed plan after it reached a settlement with its unsecured creditors' committee that bumps junior creditor payouts under the debt restructuring to $575 million from $125 million previously. Learn more about that settlement.
- Miami-Dade County Circuit Judge Michael Hanzman will hold a status conference in litigation over the June 23 collapse of Champlain Towers South in Surfside, Florida. The death toll in that tragedy on Tuesday officially stood at 95. Lawyers for the Champlain Towers South Condominium Association previously revealed it had $48 million in insurance to potentially cover any claims. Hanzman earlier this month placed the condo association into receivership and appointed Akerman partner Michael Goldberg to handle financial matters while litigation continues.
- Amazon.com Inc through lawyers led by Gibson Dunn's Jason Schwartz will ask Manhattan Supreme Court Justice Nancy Bannon to dismiss or stay a lawsuit by New York Attorney General Letitia James over the retailer's handling of worker safety issues around the COVID-19 pandemic at two warehouses.
- Match.com Inc will urge Manhattan Supreme Court Justice Joel Cohen to bar Tinder co-founder Sean Rad and other early employees from presenting evidence at a trial concerning the dating app's valuation about a 2017 investigation into allegations that former Match CEO Gregg Blatt sexually assaulted a subordinate at a holiday party. The ex-employees lawyers, led by Gibson Dunn's Orin Snyder, say Match and its then-controlling shareholder, IAC/InterActiveCorp, undervalued Tinder to avoid paying them billions of dollars. They say the internal probe was deficiently conducted to ensure Blatt remains in control to execute the valuation scheme. Defense lawyer Marc Wolinsky of Wachtell Lipton counters that the allegations are irrelevant to their contractual claims.
- The U.S. Senate is expected to vote to cut off debate and then proceed to a vote to confirm Seema Nanda, who filled various posts at the U.S. Department of Labor during the Obama administration, to serve as the solicitor of labor.
- The founder of a global wholesale consumer electronics business is expected to be sentenced by U.S. District Judge Paul Engelmayer in Manhattan after pleading guilty to participating in a conspiracy to operate an unlicensed money transmission business that operated between Colombia and the United States. Defense lawyers for Best Electronics founder Amit Agarwal including Peter Skinner of Boies Schiller Flexner and Brendan Quigley of Baker Botts are calling for a sentence of time served, while prosecutors say he deserves 30 to 37 months in prison.
BakerHostetler's chairman eyes return-to-work, worries about attorney 'burnout'
In the effort by major law firms to get back to business as normal following the COVID-19 pandemic, Monday marked a turning point for BakerHostetler: For the first time, all of its offices were open, though at reduced capacity.
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Paul Schmidt BakerHostetler
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For Paul Schmidt, the 977-lawyer firm's chairman, the challenge now is to prepare the firm for a full reopening in early September. When The Daily Docket recently got him on the phone, Schmidt was mulling the pandemic's effects on retaining junior lawyers, the associate salary wars and how his attorneys should work post-coronavirus.
On the firm's approach to attorneys working remotely post-Labor Day: "We believe our people are professionals. We are encouraging them to be in the office and telling them, look, your job requires you to be in the office. But we don't necessarily need to tell you what your office hours are, how often you need to be in the office."
On how the firm's reopening plans could be affected by the Delta or other variants: "I'm optimistic the medical solutions are going to hopefully stay in front of this and eventually cause it to really be able to be controlled and contained. But if there was a lesson out of the last year and a half, it's that we've got to be adaptable in order to be resilient."
On the pandemic's impact on retaining lawyers: "I think it is absolutely a challenging time. Because of the pandemic, people are burned out. People had nothing else to do, and a lot of people sent themselves into work. But, over a year of doing that and not socializing, that really takes its toll. So you've got burnout, you have people leaving, and yet people forget that especially for firms with big business practices, the demand is high."
On whether raising associates' salary is the solution: "I think that only addresses a part of everything that's going on. You also have people just leaving the practice, people deciding, you know, I don't want to live in the city anymore, and suburbs are good, or an island is really nice. I think that's a bit of what's driving it, and it is frankly breathtaking and remarkable."
Video: Delay may penalize former Yankee Joe Pepitone's pursuit of Mantle home run bat
New York Yankees player Joe Pepitone – an All Star and Gold Glove winner – has sued the Baseball Hall of Fame as he tries to reclaim the bat used by legendary hitter Mickey Mantle to hit his 500th home run in 1967. But after 54 years, did Pepitone wait too long to make his case? Tom Rowe explores in his latest video report. Watch the video, and check out Alison Frankel's recent column on the case.
"It is simply inconceivable that the Program's audience would have found a segment with Judge Moore activating a supposed pedophile-detecting wand to be grounded in any factual basis."
U.S. District Judge John Cronan in Manhattan, who dismissed a defamation lawsuit Roy Moore filed against Sacha Baron Cohen in which the former U.S. Senate candidate from Alabama and chief justice on the state's top court claimed he was duped into appearing on the comedian's Showtime series "Who Is America?" and falsely portrayed as a sex offender. During the segment, Baron Cohen retrieved a wand-like gadget that he claimed could detect if people were sex offenders that then beeped when it was moved near Moore. Cronan called the segment "clearly a joke." (Reuters)
In the courts
- A federal jury in Manhattan found former Federal Savings Bank CEO Stephen Calk guilty of charges that he approved $16 million in risky loans for Paul Manafort, former President Donald Trump’s onetime campaign manager, in an effort to gain a top post in the Trump administration. Calk's lawyer, Paul Schoeman of Kramer Levin, called the verdict disappointing and promised an appeal. (Reuters)
- A unit of the Teachers Insurance and Annuity Association of America will pay $97 million in restitution to tens of thousands of customers who were misled into moving their retirement money into higher-fee accounts, the SEC and New York Attorney General Letitia James announced. TIAA-CREF Individual & Institutional Services, represented by Lori Martin of WilmerHale, did not admit wrongdoing. (Reuters)
- The U.S. Supreme Court released its calendar for the upcoming fall term, officially scheduling arguments in a case over whether the government can use the "state secrets privilege to bar the release of national security information in litigation for Oct. 6 and the DOJ's case to reinstate the death penalty for Boston Marathon bomber Dzhokhar Tsarnaev for Oct. 13. (SCOTUSblog)
- The 4th Circuit sided with gun rights advocates in a case over several federal laws that ban the sale of handguns to people under 21 but allow them to purchase shotguns and rifles. The divided court said bans on gun sales based on age violate the Second Amendment, handing a win to advocates represented by Elliott Harding of Harding Counsel. Kirti Datla of Hogan Lovells and Angela Ellis of Sullivan & Cromwell argued in favor of the law on behalf of the gun control groups Brady and Giffords Law Center to Prevent Gun Violence, respectively. (USA Today)
- The 3rd Circuit ruled that an amendment to the False Claims Act that eased the burden of proof on whistleblowers applies retroactively to any case that was pending when the U.S. Supreme Court issued a ruling that the law was designed to address. The court in rejecting a bid by Farfield Co's lawyer Susan Friedman of Stevens & Lee to overturn a $1 million judgment against the contractor deepened a circuit split over the application of the Fraud Enforcement and Recovery Act of 2009. (Reuters)
- The California Public Employees' Retirement System, the country's largest public pension fund, has agreed to pay $2.7 billion to nearly 80,000 workers and their families to resolve a class action lawsuit over premium increases to cover long-term care. Stuart Talley, a lawyer for the the policyholders at Kershaw, Cook and Talley, said most policyholders would receive between $35,000 to $50,000. (Sacramento Bee)
- The activist known for taking on affirmative action at Harvard has a new target: California laws that require gender and racial diversity on corporate boards. Edward Blum and his nonprofit Alliance For Fair Board Recruitment filed a lawsuit in Los Angeles federal court Monday claiming the laws violate the Constitution’s equal protection clause. C. Boyden Gray, a former White House counsel to former President George H. W. Bush now at Boyden Gray & Associates, is pursuing the case. (Reuters)
- DuPont and two related, spinoff companies will pay $50 million to help clean up toxic chemicals in Delaware as part of a settlement between the businesses and the Delaware Department of Justice. The deal, which could include an additional $25 million if the companies reach larger settlements with other states, resolves claims the companies released so-called "forever chemicals" into the state’s environment through industrial activity. (AP)
- A gaming tech patent holder will get a second shot at some of its claims against Sony over Playstation 4 technology after the Federal Circuit said the trial court judge held the company to too strict a standard. The court upheld the dismissal of two of the claims but reversed on two others, saying U.S. District Judge William Alsup's requirement that patent holder Bot M8 cite "every element" of the patents that were allegedly infringed went too far. (Reuters)
Industry moves
- Litigator Bethany Lukitsch has joined BakerHostetler as a partner in its Los Angeles office and co-leader of its class action defense team. She previously chaired McGuireWoods’ class action practice and led its data and privacy team’s litigation subgroup. (Reuters)
- H. Gregory Baker, a former senior counsel for the SEC’s Division of Enforcement Asset Management Unit, has left Lowenstein Sandler to join Patterson Belknap Webb & Tyler. He'll serve as the chair of the firm's securities litigation practice in New York. (Patterson Belknap)
- Immigration attorney Timothy D'Arduini has joined Quarles & Brady’s D.C. office as a partner in its labor and employment practice group from Mayer Brown. The firm said that D'Arduini plans to relaunch the D.C. office's immigration practice with a diverse team of professionals. (Quarles)
- Sarah Tauman has joined DLA Piper's employment practice as a partner in San Francisco. She was previously an associate at Goodwin Procter. (DLA Piper)
- Tim Kirby has joined Katten's capital markets practice as a partner in New York. He was previously an associate at Milbank. (Katten)
- Garen Dodge has rejoined Jackson Lewis as a principal in D.C. He was previously a labor and employment attorney at Epstein Becker & Green. (Jackson Lewis)
Columnist spotlight: When emotions interfere with advocacy, 'Kraken' edition
Pro-Trump lawyer Julia Haller is adamant that she didn’t actually cry during a sanctions hearing in Michigan on Monday stemming from a 2020 election challenge, but Jenna Greene writes that there were times when it sounded like she was close. For many lawyers, finding the right mix of confidence, authority and authenticity when speaking in court is a challenge, and for some women in a profession historically dominated by men, this can be especially difficult. While U.S. District Judge Linda Parker in Detroit exuded authority with every forceful syllable, Haller, voice cracking, struggled to stay composed. It's not that emotion has no place in court, Greene writes, but it can also undermine your message. See what one voice coach recommends.
Lawyer speak: After Transunion, expect a wave of class actions in state courts
The last few years have seen record-breaking settlements in class actions accusing companies like Facebook and TikTok of statutory violations of privacy. But Steven Blonder of Much Shelist writes that such cases at the federal level are likely now dead on arrival after the U.S. Supreme Court's June 25 decision in Ramirez v. Transunion, which held that every member of a class certified under the Federal Rules of Civil Procedure must establish Article III standing to be awarded individual damages. Blonder writes that going forward, expect "a wave of state court filings by plaintiffs lacking standing to pursue federal claims, which run the risk of inconsistent results from state to state." Read more.
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