Good morning. Seth Zachary, the longtime chairman of Paul Hastings, is stepping down — and he talked to Reuters about how law firm culture has shifted during his tenure and how his firm stays competitive. Plus, we’ve got a look at the obscure court where lawsuits over vaccine side effects go to be heard and the details on 3M’s agreement to pay nearly $100 million over “forever chemicals.” This jam-packed newsletter is brought to you by Halloween candy and espresso!
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Seth Zachary is stepping down as the chairman of Paul Hastings next year, after 22 years at the helm of the LA-founded firm. He is leaving as law firms get away from that type of long-term leadership and turn their focus to competition, merit and diversity, he told Karen Sloan.
In general, firms are far less top-down now, he said. There is more recognition of the work of associates and young partners, and more competition to keep people aboard.
Of the lateral market, Zachary said he’s “never seen it like this.”
“Law firms have to focus a lot on delivering for their partners, just like the partners deliver to the firm — even in the case of loyal, prosperous partners — or other firms will try to recruit them.”
Read for more of what Zachary says about the future of the legal industry.
- Law firm leasing activity in major U.S. markets rose in the third quarter of 2021, providing a sign that the law firm real estate market may be gradually rebounding more than 18 months into the COVID-19 pandemic, global property agent Savills said. (Reuters)
- Ben Wilson, 70, who is retiring in January from the chairmanship of environmental law firm Beveridge & Diamond, spoke with Reuters about the shifting diversity landscape in the legal industry and his hopes for the future. (Reuters)
- London-founded Allen & Overy is expanding its flexible staffing platform Peerpoint to the U.S. The service, first launched in 2013, provides interim talent for legal departments and is seen as an alternative career path for lawyers seeking more "control and choice." (Reuters)
- Illinois Rep. Cheri Bustos talked to Reuters about her newly-introduced bill to crackdown on bonuses for executives at companies in bankruptcy. The bill would prevent executives of bankrupt companies who make more than $250,000 from receiving bonuses either during or just before a bankruptcy. Watch a video of the interview. (Reuters)
That’s the amount Credit Suisse agreed to pay to U.S. and British authorities to resolve charges tied to Mozambican bond offerings. Credit Suisse was represented by lawyers from Paul Hastings and Kirkland & Ellis. Read the plea agreement and deferred prosecution agreement filed in the U.S. District Court for the Eastern District of New York.
Video: Defending an accused spy — an inside look
As a couple accused of trying to sell nuclear sub secrets head for a detention hearing Wednesday, Stuart Sears of Schertler Onorato Mead & Sears, explains the challenges of having a client accused of violating national security. Watch the video.
Reuters Events: Legal Leaders 2021
Being a good lawyer isn’t enough anymore -- the best general counsel are exerting a positive influence beyond everyday legal issues. On Oct. 19 and 20, more than 50 of the most prestigious GCs in the United States will speak about business-critical topics including leadership, talent, ESG, diversity and more. Click here for more information and to register.
- Los Angeles Superior Court Judge Holly Thomas will appear before the U.S. Senate Judiciary Committee for her confirmation hearing for a seat on the 9th Circuit. Thomas, a Yale Law School graduate and former U.S. Justice Department civil rights appellate lawyer, would become the second Black woman ever to serve on the San Francisco-based appeals court. She was formerly the deputy director of executive programs at the California Department of Fair Employment and Housing and as an assistant counsel at the NAACP Legal Defense and Educational Fund. Thomas has served on the Los Angeles court since 2018. The committee will also take up five other nominations: Mary Dimke for the Eastern District of Washington; Maame Frimpong and Hernan Vera for the Central District of California; Jennifer Thurston for the Eastern District of California; and Charlotte Sweeney for the District of Colorado.
- Two New York lawyers charged with attacking an empty police vehicle with a Molotov cocktail during a protest over George Floyd's death are expected to plead guilty in Brooklyn, New York, federal court. Colinford Mattis, a Pryor Cashman associate who was suspended after his arrest, and public interest attorney Urooj Rahman faced a mandatory prison sentence of 45 years to life if they had proceeded to trial and lost.
- U.S. Bankruptcy Judge J. Craig Whitley is scheduled today to preside at the “first day” hearing for new J&J subsidiary LTL Management LLC, which was created to hold the company’s liabilities from the Baby Powder litigation. The hearing in Charlotte, North Carolina, bankruptcy court will mark the first time the company’s attorneys, including teams from Jones Day, White & Case and Rayburn Cooper & Durham, can present their plan, get permission to maintain their bank accounts and confront anyone who objects to the bankruptcy.
- A three-judge panel of the Kentucky Court of Appeals will weigh in on a clash between federal and state law in a case that involves financing arrangements in the thoroughbred industry. A Paul Weiss team led by appellate veteran Kannon Shanmugam represents MGG Investment Group in a dispute over $30 million in loans made in 2016 to the stables that owned Triple Crown winner American Pharoah. The champion and several other horses were collateral on the loan, but MGG accused the stables of going behind its back and selling ownership stakes and breeding rights for them. The appellate court will consider whether a federal law protecting the buyers of “farm products” applies, or if Kentucky law exempting “equine interests” from that law takes precedence. A team from Bullock & Coffman, including Thomas Bullock, represent some of the buyers. The Paul Weiss lawyers are working with attorneys from Wyatt, Tarrant & Combs.
Court calendars are subject to last-minute docket changes.
"I won’t be keeping everyone in suspense."
U.S. Bankruptcy Judge Kevin Huennekens in Richmond, Virginia, who told LeClairRyan founder Gary LeClair, alternative legal services provider UnitedLex and Chapter 7 trustee Lynn Tavenner he will rule quickly on whether to allow Tavenner’s suit accusing LeClair and UnitedLex of helping drive the now-defunct law firm into the ground to proceed. Tavenner has said LeClair enriched himself at the firm’s expense, accusations LeClair has denied. Read more about Huennekens’ hearing on LeClair’s motion to dismiss.
- Rep. Jeff Fortenberry, a Republican from Nebraska, was indicted on charges he lied to the FBI about illegal contributions to his 2016 campaign. Fortenberry, who preempted news of the indictment with a video about it posted on YouTube, is scheduled to be arraigned today. (Reuters)
- 3M has agreed to pay $98.4 million to settle several different actions involving separate but related disputes over the company’s manufacturing and disposal of polyfluoroalkyl and perfluoroalkyl substances, or PFAS, in Tennessee. 3M is represented in the cases by Richard Bulger of Mayer Brown and Harlan Prater of Lightfoot Franklin & White. (Reuters)
- Facebook has agreed to pay $14.5 million to settle claims the social media company violated recruitment rules and discriminated against American workers. The settlement “represents by far the largest civil penalty the Civil Rights Division has ever recovered in the 35-year history of the Immigration and Nationality Act's anti-discrimination provision," Kristen Clarke, head of DOJ’s civil rights division, said. (Reuters)
- U.S. Supreme Court Justice Stephen Breyer turned away a religious challenge to a requirement that healthcare workers in Maine be vaccinated against COVID-19, telling the plaintiffs to come back once a federal appellate court has ruled on the case. A few hours later, the 1st Circuit issued its own ruling leaving the mandate in place — setting the case up to head back to the high court. (Reuters)
- U.S. District Judge John Mendez of Sacramento, California, said at a hearing he is unlikely to block a law requiring publicly held companies headquartered in the state to have a minimum number of women on their boards before a December deadline. OSI Systems shareholder Creighton Meland, who is represented by Anastasia Boden of the Pacific Legal Foundation, sued over the law, saying it is unconstitutional because it pressures shareholders to vote for women directors. (Reuters)
- Paul Hastings said Jeffrey Goldfarb has joined the firm’s New York office as a partner focused on leveraged finance and private equity. He joins from Willkie Farr, where he was vice chair of the finance practice. (Reuters)
- Kramer Levin has hired Elisia Klinka as a partner focused on private equity and mergers and acquisitions. Klinka formerly was a counsel at Lowenstein Sandler. (Kramer Levin)
- Morgan Lewis said Andrew Enschedé has rejoined the firm as a partner in Washington, D.C. Enschedé, who focuses on insurance and business transaction dispute resolution, arrives at the firm from Greenberg Traurig. (Morgan Lewis)
- Proskauer has brought on Robert Friedman as a tax partner in the firm’s Los Angeles office. Friedman joins the firm from Troutman Pepper. (Proskauer)
- Kyle DeYoung has joined Kirkland & Ellis as a partner in the D.C. office. DeYoung, who comes from Cadwalader, Wickersham & Taft, is now part of Kirkland’s SEC enforcement defense team. (Kirkland)
- After three years at Perkins Coie, government contracts specialist David Fletcher has returned to Cooley to help the firm expand its contracting practice. (Reuters)
A central bank digital currency, or CBDC, can provide an opportunity for central banks to “embrace the crypto revolution while retaining control over monetary policy,” Barnabas Reynolds and Donna Parisi of Shearman & Sterling write. Central banks in the U.S., China and United Kingdom are weighing whether to adopt or embrace CBDCs. The future of CBDCs will require resolving points of legal uncertainty and systemic risk. Read more about consideration for developing a regulatory and legal framework for a CBDC.
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