Litigation

The White Collar Defense Dilemma: To Testify or Not?

By Kevin Chiu, J.D. Candidate 2018 | Posted on

The question of whether or not a defendant should take the stand remains a rightfully contested issue for legal professionals in the practice of white collar criminal defense. With no clear empirical evidence to suggest an advantage from this nuanced decision, lawyers are racked with the quandary of predicting how their client(s) would handle the high stakes of cross examination and direct jury exposure in legal matters that turn mostly on a defendant’s perceived credibility and motives at the time of the alleged crime.

Back in late October, a federal court in the Southern District of New York heard oral testimony from Anthony Allen, former head of global liquidity and finance at Rabobank and lead defendant in the first US criminal trial of traders involved in the London interbank offered rate (Libor) interest rate scandal. The prosecution questioned Allen regarding a number of communications made between him and traders in the bank. In one instance, Allen had responded in a message to a trader, “No worries mate, glad to help.” Allen contended that the response was simply a dismissal to the trader that he was not going to comply with the request, which Allen testified as “not right.”

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Mistrial Declared in Dewey & LaBoeuf Case

By Kevin Jones, J.D. Candidate 2018 | Posted on

People v. Davis, the Manhattan criminal trial for three former senior executives from big-time law firm Dewey & LeBoeuf LLP, ended in a mistrial due to a hung jury. The jury of seven women and eight men acquitted each defendant on several counts of falsifying records and remained deadlocked 8-4 on the remaining 93 charges relating to fraud, larceny, and conspiracy. Defendants Steven H. Davis, Stephen DiCarmine and Joel Sanders were originally charged with a total of 151 counts, ranging from minor felonies to grand larceny, a charge that would have potentially made each of them face a prison sentence of 25 years.

According to the prosecution, the three defendants had allegedly stolen over $200 million from insurers and financial firms in a fraudulent scheme that involved manipulating the firm’s accounting reports in an attempt to cover up its dire financial situation. Dewey & LeBoeuf LLP then collapsed and filed bankruptcy in 2012. Experts estimated the firm owed about $245 million to creditors.  Defense counsel rebutted the allegations, contending the demise of the firm related to mass departures of “greedy” partners and that the defendants never had any intention to defraud investors.

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Tough Law for Investment Banks in Delaware Courts

By Alan Parker, LLM Candidate 2016 | Posted on

Investment banks are having a rough time litigating in Delaware Courts, and the horizon does not look any clearer. As the presence of investment banks in major merger deals in US becomes almost mandatory, it is easy to observe an ever-growing number of disputes related to alleged conflicts of interests between the investment banks and the multiple parties involved in such transactions. These disputes are mostly resolved in Delaware courts, which are the main venues for merger disputes, as most of the publicly-traded companies are incorporated in such state.

One of the latest lawsuits discussing this kind of conflict of interests is In Re Zale Corporation Stockholders Litigation. As explained in this comprehensive article published by Prof. Steven Solomon, in this case Merrill Lynch (“ML”) was retained by the Board of Directors of Zale Corporation (“Zale”) to advise it on the latter’s buyout by Signet Jewelers Limited (“Signet”) in a $1.4 billion transaction. However, before being retained by Zale, ML pitched to advise Signet on the very same deal, and the former only disclosed that it had previously pitched Signet after the closing of the transaction. Zale accepted a price per share of $21.00, which represented a 41% premium, exactly within the price range suggested by ML’s pitch to Signet.

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Uber Investigates Connection between Data Breach and Lyft CTO

By By Brigid McCurdy, J.D. Candidate 2017 | Posted on

The rivalry between ride-sharing companies Uber and Lyft continues, as Uber probes further into the identity of the hacker responsible for the company’s driver data breach.

In February, Uber announced that a hacker improperly downloaded the names and license numbers of about 50,000 of the company’s drivers. Shortly after announcing the breach, Uber filed a “John Doe” suit in federal court in San Francisco, alleging that the unknown hacker violated provisions of the federal Computer Fraud and Abuse Act. Uber then filed a subpoena request for Comcast’s records, claiming that an unidentified individual using a Comcast IP address had access to the security key that was used in the data breach. U.S. Magistrate Judge Laurel Beeler granted Uber’s subpoena request for Comcast’s records, reasoning that the records would be “reasonably likely” to help find the responsible hacker.

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Uber Plans to Appeal Driver Class Certification

By Aicha Ahardane, LL.M. Candidate 2016 | Posted on

The U.S District Court for the Northern District of California set up a high-stakes legal battle for Uber that might erode the unicorn’s $50 billion valuation.

In his September 1decision, Judge Edward M. Chen granted class-action status to a lawsuit brought by two Uber drivers seeking reclassification as employees to obtain reimbursement for expenses and tips. He ordered that the suit applies to all drivers in California who didn’t waive their right to the class action.

Despite the fact that Judge Chen had previously approved the arbitration clause stated in Uber’s drivers contracts in O’Connor v. Uber Technologies, Inc., he recently denied Uber’s motion to compel arbitration finding the arbitration clauses entered into with Uber drivers to be unenforceable.

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Class Certification in Nexium ‘Pay for Delay’ Litigation Survives Appeal

By Bo Griffith, J.D. Candidate 2016 | Posted on

On January 21, the U.S. Court of Appeals for the First Circuit concluded that a district court did not abuse its discretion in certifying a class of Nexium purchasers in their “pay for delay” claim against the drug’s producer, AstraZeneca. The plaintiff class, made up of Nexium purchasers, asserted a Sherman Act claim against AstraZeneca, arguing the drug company injured consumers by foreclosing generic markets of the heartburn drug.

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Innovative Lawsuit Targets U.S. Bank’s Government-Backed Mortgages

By Whitney Florian, J.D. Candidate 2017 | Posted on

U.S. Bank, a division of U.S. Bancorp, is being sued in an Ohio federal court for failing to comply with the Federal Housing Administration (“FHA”) requirement that banks engage with borrowers in default. Advocates for Basic Legal Equity (“ABLE”), a legal aid group, filed the first-of-its-kind suit on behalf of the United States government.

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Monsanto and Dow Chemical Challenge Anti-GMO Law in Hawaii

By Philip Merksamer, J.D. Candidate 2017 | Posted on

Less than two weeks after the voters of Maui County, Hawaii approved a moratorium on the cultivation of genetically engineered crops, Monsanto and Mycogen Seeds (a subsidiary of Dow Chemical) have filed suit in federal court to block the law. If upheld, the local referendum may substantially limit the development of genetically modified organisms (GMOs) in Maui County, which could have a tremendous impact on how biotech companies conduct research.

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Facebook Aims to Retaliate Against DLA Piper and Other Firms

By John Runkel, J.D. Candidate 2016 | Posted on

On Monday, October 20th Facebook filed charges against DLA Piper along with several other firms and attorneys that had represented Paul Ceglia in an earlier suit opposing Facebook. The October 20 lawsuit, filed in the New York Supreme Court, is based largely on facts pertaining to a 2010 action in which Ceglia sued Facebook.

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Exclusive Forum Provisions

By Transaction Advisors | Posted on

A recent spike in the use of exclusive forum provisions in M&A deals has made the task of evaluating whether such a provision could be beneficial a vital step on any dealmaker’s checklist.

The recent surge in the use of provisions can be attributed to its general enforcement under judicial review, whether in Delaware or other jurisdictions.

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