Good morning. Ohio’s top court is poised to add its voice to the chorus of rulings against insurance coverage for COVID-related business disruptions. Plus: some legal experts see a new threat to the Voting Rights Act in the U.S. Supreme Court’s ruling this week on an Alabama electoral map, and the Purdue Pharma bankruptcy mediator said a new deal over opioid claims is close. We’ve got the latest from Sarah Palin’s defamation trial against the New York Times, and much more. Thanks for spending part of your Wednesday with us. Let’s jump right in!
Filling in today for Diana Novak Jones is our colleague Karen Sloan, who reports on law firms, law schools and the business of law. Were you forwarded this email? Subscribe here.
Businesses seeking to recover COVID-related losses from their insurance carriers haven’t enjoyed much success in the federal courts, with hundreds of cases already rejected. Will state courts be more sympathetic to their plight? It’s looking unlikely.
The Ohio Supreme Court on Tuesday became just the third top state court to weigh whether commercial property insurance policies cover losses businesses sustained due to pandemic closures, following Massachusetts and Vermont. The Ohio justices expressed skepticism over the plaintiff’s claim that COVID -related losses constitute property damage, Nate Raymond reports.
Attorney Nicholas DiCello, who is representing audiology services provider Neuro-Communication Services Inc. in its suit against Cincinnati Insurance Co., told the court that COVID-19 is no different than a dangerous gas leak that renders a property unusable. “They are physical particles that have a physical manifestation," DiCello said of the coronavirus. But Chief Justice Maureen O'Connor retorted that virus particles can also be wiped away, citing the court’s own cleaning procedures.
The U.S. Supreme Court’s 5-4 decision this week allowing Alabama to use a contested electoral map for the November midterm elections signals a potential further weakening of the Voting Rights Act (VRA) according to legal experts, our colleagues Andrew Chung and Lawrence Hurley write in a new report.
Election law expert Ned Foley of Ohio State University's Moritz College of Law said the Supreme Court's ruling threatens decades of precedent requiring states to create Black-majority districts "where it's geographically possible to do, and conditions of racially polarized voting prevail.”
The justices will hear Alabama's arguments in the case this autumn. Legal experts said the ruling on the merits, expected by the end of June 2023, could make it harder for courts to consider race when they weigh whether an electoral map violates a provision of the VRA, known as Section 2, that bars voting practices that result in racial discrimination. "If the court accepted Alabama's argument, that would be the end of Section 2 as we know it," Harvard Law professor Nicholas Stephanopoulos told Reuters.
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- A 7th Circuit panel unanimously ruled for Chicago-based litigation boutique Bartlit Beck in its bid to force a former client, Japanese pachinko billionaire Kazuo Okada, to pay more than $50 million in legal fees. (Reuters)
- Representing whistleblowers isn’t quite as niche of a practice these days. A surge in awards from the U.S. Securities and Exchange Commission's whistleblower program over the past 20 months is prompting more lawyers to get in the game. (Reuters)
- What do Microsoft’s top lawyer Brad Smith, television’s Judge Judy, and the owner of the Minnesota Vikings all have in common? They’ve each cut $5 million checks to law schools in recent months. (Reuters)
- Troutman Pepper expanded its financial services practice with the addition of seven consumer financial partners from Ballard Spahr. Christopher Willis, who will join the firm in Atlanta, and Mark Furletti, joining Troutman’s Philadelphia office, will be co-leaders of a regulatory-focused practice. (Reuters)
- Robin Morris Collin, a law professor at Willamette University in Oregon, will join the U.S. Environmental Protection Agency to lead efforts to advance environmental justice in communities disproportionately harmed by pollution. Collin was the first law professor to teach sustainability courses at a U.S. law school. (Reuters)
That’s the U.S. Justice Department’s largest-ever financial seizure, representing cryptocurrency that was stolen from the 2016 hack of virtual currency exchange Bitfinex. The FBI arrested a married couple on allegations they conspired to launder the stolen cryptocurrency. In a statement, Deputy Attorney General Lisa Monaco said cryptocurrency is "not a safe haven for criminals." Read more.
The Supreme Court is poised to decide later this year in Viking River Cruises v. Moriana if employees who have signed individual arbitration agreements can nevertheless sue on behalf of co-workers under California’s Private Attorney General Act. Alison Frankel reports on new amicus briefs from California employment groups that want the Supreme Court to rule that the Federal Arbitration Act prohibits PAGA suits by workers who have agreed to individual arbitration. The groups contend PAGA is a catastrophe — for them and for workers.
"It's so hard … for me to tell now what I knew at the time, what I've learned since, and I'm sorry, I've kind of mixed that stuff up."
—James Bennet, a former New York Times editorial page editor, testifying at Sarah Palin’s defamation trial against the newspaper over a 2017 editorial that incorrectly linked the former Republican vice presidential candidate to an earlier mass shooting in Arizona. Bennet told Palin's lawyer Shane Vogt he had no independent recollection of whether he had read some background material that colleagues had sent him prior to publication that might have alerted him to the error. Our colleagues Jonathan Stempel and Jody Godoy have more on the trial here.
- The American Bar Association kicks off its six-day Midyear Meeting, with 170 panels, committee meetings and awards ceremonies. The meeting was to be the association’s first fully in-person large event since the start of the pandemic, but leaders decided in January to switch from an onsite event in Seattle to a virtual format due to the Omicron surge.
- Lawyers for a former senior executive at private equity firm TPG Capital charged in the U.S. college admissions scandal will ask the 1st Circuit to overturn a key pretrial ruling that was issued before he pleaded guilty to paying $50,000 to rig his son's college entrance exam results. Bill McGlashan was sentenced to three months in prison after pleading guilty to wire fraud. McGlashan’s deal with prosecutors allows him to back out if he wins his appeal, which challenges the rejection of his claim that test scores can’t be deemed “property” for purposes of charging him with wire fraud. Sidley Austin appellate veteran Carter Phillips will argue for McGlashan, and Alexia De Vincentis will represent the United States.
- Meanwhile, a former executive at the casino company Wynn Resorts is set for sentencing after his conviction in the U.S. college admissions scandal. Prosecutors said Gamal Aziz paid $300,000 to secure his daughter's admission to the University of Southern California as a fake basketball recruit. Aziz’s defense includes a team from Nixon Peabody. Aziz will appear before U.S. District Judge Nathaniel Gorton in Boston federal court.
- Consumer brand owner Jarden will ask the Delaware Supreme Court to revive a lawsuit accusing its insurers of failing to cover certain costs related to a shareholder appraisal action over its 2016 sale to food container maker Newell Rubbermaid. Delaware Superior Court Judge Abigail LeGrow in Wilmington in August ruled for the five insurers, including ACE American Insurance Company and Allied World National Assurance, that an appraisal action was not covered under the policy agreements. David Baldwin of Berger Harris represents Jarden, and ACE is represented by Michael Goodstein of Bailey Cavalieri and John Reed of DLA Piper. Scott Schreiber and William Perdue of Arnold & Porter represent Illinois National Insurance.
Court calendars are subject to last-minute docket changes.
- A mediator has asked a federal bankruptcy judge to allow more time for the members of the Sackler family who own Purdue Pharma and U.S. states opposed to the OxyContin-maker's bankruptcy exit plan to reach a settlement on claims that the company fueled a U.S. opioid epidemic. In court papers, the mediator asked to extend the negotiation deadline from Feb. 7 to Feb. 16, saying the parties are “even closer” to a settlement. (Reuters)
- An investor in Rocket Companies, the operator of one of the largest U.S. mortgage lenders, has sued the company’s chairman for insider trading, claiming he sold $500 million in company stock ahead of a March 2021 public disclosure of poor financial results. The company is also facing a securities class action in Michigan that accuses it of concealing rising competition and other factors that caused the poor financials. (Reuters)
- The U.S. Justice Department opposes a bid by families of victims of the two 737 MAX crashes asking a judge to publicly declare the government violated their rights when it struck a plea deal with Boeing in January 2021. DOJ said in a court filing it had “no legal obligation” to confer with the crash victims’ beneficiaries before entering into the deferred prosecution agreement. (Reuters)
- Among the more than 225 people who have been charged in connection with the Jan. 6, 2021 storming of the U.S. Capitol is a North Carolina man who was out on bail on an unrelated attempted murder charge at the time. According to newly unsealed court documents, Capitol riot defendant Matthew Beddingfield was charged with shooting a 17-year-old in the head after an altercation in a Walmart parking lot in 2019. (Reuters)
- Wilson Sonsini brought on Richard Goold as a corporate partner in London from Ernst & Young, where he served as the global head of tech law. (Reuters)
- Shearman & Sterling added Maegen Morrison, former equity capital markets practice leader in London for Hogan Lovells. (Reuters)
- Perkins Coie hired Chicago-based intellectual property partner Hari Santhanam. He arrives at the firm from Kirkland. (Perkins Coie)
- Litigation funder Omni Bridgeway said Jason Levine is joining the company to start an office in Washington, D.C. Levine formerly was a partner at Alston & Bird and Vinson & Elkins. (Omni Bridgeway)
- Debevoise said Kristin Snyder will join the firm as a San Francisco-based white-collar partner. Snyder recently served as deputy director of the U.S. Securities and Exchange Commission’s examinations division. (Debevoise)
- Reed Smith said Rebecca McKnight joined the firm’s office in Austin, Texas, as a life sciences health industry partner. She earlier practiced at DLA Piper. (Reed Smith)
- Baker Botts hired Michael Ward as a white-collar litigation partner based in the firm’s Palo Alto office. He arrives from Vinson & Elkins. (Baker Botts)
- Duane Morris added twelve attorneys to its Newark office from McCusker, Anselmi, Rosen & Carvelli. The group is led by partner John McCusker, and includes trial partners Alicyn Craig, Rosemarie DaSilva, Kathleen Hirce and Alice Shanahan, and labor and employment partners Michael Futterman and Patrice LeTourneau. (Duane Morris)
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