In House: August 2009 Archives
In House - The FindLaw Corporate Counsel Blog

August 2009 Archives

5 Qualities of Stellar In House Counsel

In-house counsel attorneys have a unique vantage point.  They are part of a broader business but are specifically slated to act as the company's legal eyes and ears.  And, for some attorneys, a corporate counsel seat is also much sought-after for its lifestyle benefits including regular workdays sans the billable hours. 

So whether you seek a position within a corporate legal department, are new to the in-house counsel scene, or are just looking to master the domain, here are some characteristics that make for stellar in-house attorneys.

Dear SEC, We Support the Shareholders. Sincerely, Law Firms

Getting a letter addressed from a law firm can be cause to cause consternation, but one signed off by nine different law firms can lead to a medical condition.  Fortunately the letter sent to Securities and Exchange Commission (SEC) signed by multiple law firms was in support of its proposal to beef up shareholder rights.

Nine major securities and corporate governance law firms signed their support of the SEC initiative in a letter, in light of comments made by certain New York law firms challenging the SEC's proposed rule.  The SEC rule, called "Facilitating Shareholder Director Nominations" would require a company to include its shareholders' nominees for director in proxy materials.

It all comes down to accountability.

e-Discovery 101 for the In-House Attorney

From the halls of software companies and the conference rooms of legal technology firms, e-Discovery is coming in-house.  The American Bar Association (ABA) reports on the recent trend of big companies to develop e-discovery resources within their own legal departments rather than passing the baton to outside counsel.

Perhaps it is a sign of the economy or the desire to get more bang for the company's proverbial buck, but the move indoors can leave an in-house counsel wondering...what exactly is e-Discovery again?

Here is a primer on the practice, and what you need to sound coherent in discussing the ins and outs of e-Discovery.

BofA Keeps Its In-House Counsel Busy

If you are in-house counsel at Bank of America, you likely find your plate pretty full these days.  And that's thanks to a couple of big August BofA settlements and a case that's headed to state court.

Bank of America agreed earlier this month to a $55 million settlement to put an end to claims of former employees of the BofA-acquired Countrywide Financial Corp.  The class action suit claimed that Countrywide breached  an obligation to manage the former employees' funds properly. 

Fired In-House Attorneys OK to Bring Whistleblower Case

The American Bar Association (ABA) reports that two in-house legal attorneys claiming that they were fired for raising questions about potential securities fraud have been given the nod to pursue their claims as a result of a federal appeals ruling in the 9th Circuit.

In a case of first impression, the 9th Circuit appellate court held that under the whistleblower provision of the Sarbanes-Oxley Act, the attorneys do not have to prove actual fraud to bring forward the case.   The 9th Circuit Court of Appeals clarified, stating that "the success, or failure,of the [] lawsuit does not depend on [the attorneys'] ability to show any actual fraud, only that they reasonably believed that fraud had occurred."

In-House Counsel's Role in ADR and Litigation

So what did the superior court judge, company president, and general counsel say when they walked into a room together?

While this might look like the start of an amusing lawyer joke, The Metropolitan Corporate Counsel's recent interview with the three sheds invaluable light on the role of in-house counsel in ADR and litigation. 

The three were asked to give their perspectives on whether in-house counsel should establish expertise in arbitration and mediation, or rather, look to outside counsel for ADR services.  And, additionally, if general counsel is in the decision-making role of directing a dispute to litigation or ADR, what factors it should consider before pursuing either option.

Ethisphere Asks, Do You Matter?

Now, attorneys are notorious for thinking they matter, a lot.  But Ethisphere.com has tried to employ some criteria to determine which in-house attorneys represent the creme-de-la-creme of corporate counsel.  The list spans all practice areas and includes federal agencies.  And, in the nouveau trend of social entrepreneurship, the list also takes into consideration top-notch public service, legal community engagement, and academic involvement.

Curious? We thought so.

Chapter 11 Company Mechanics

With Chapter 11 becoming a popular option for companies big and small, an In House associate may be ready to brush up on what is involved before offering advice on the process or calling up outside counsel.

Here is an rundown of what to expect as a company makes its way through a Chapter 11 filing:

1. Continuing Operations.  Filing for Chapter 11 makes the company a "debtor in possession" with a right to retain property of the estate and continue operating the business.

2. 341 Meeting.  About 20-40 days after filing, be ready for the "341" meeting where the trustee will ask about the company's assets and liabilities, income and expenses, and other financial queries.

3. Creditor's Committee.  The U.S. Trustee's office may go ahead and appoint a "creditor's committee" made up of the company's seven largest unsecured creditors.  The committee can participate in drafting the company's reorganization plan.

4. Reorganization Plan.  The company will be tasked with coming up with a plan on addressing its creditors, typically by prioritizing them.  The company will need a nod of approval from each class of creditors.

5. Debt Discharge.  On approval, the plan vests all property of the estate in the debtor and discharges all debts and liens incurred before the plan or as agreed to.

 

Related Resources:

Hot Apple Turnover, Hold the Google

In an interesting, but not shocking, corporate governance development, Google CEO Eric Schmidt announced  this week that he is stepping down as a director of Apple's eight-member board.  It is not merely coincidence that the news follows Google's June announcement of the company's development of ChromeOS--a laptop operating system--edging it closer to Apple's core business of laptop and desktop technology.  In fact, the Federal Trade Commission (FTC) has already raised an eyebrow at the inter-corporate nature of the board and any potential consequences of limiting competition.

Though Schmidt's departure detaches him from Apple's board after a three-year tenure, Google is still a part of the Apple pie, if by association.  Genentech CEO Arthur Levinson remains on the boards of both companies.

Southwest's New Frontier?

And now looking to the friendly skies, Southwest Airlines last week confirmed its plan to submit a bid for the bankrupt Frontier Airlines.  By getting the nonbinding proposal off the ground, in line with the bankruptcy court's requirement, Southwest can now officially check-in with Frontier to request information and documents as part of its due diligence efforts to research the company.

Southwest may be number one in daily domestic flight operations, but it came in second in making a move for Frontier.  Indiana's Republic Airways submitted its $108.8 million bid earlier last month.  The bid was provisionally agreed to by the judge, so long as no better offer came along before August 10th 2009. 

And then Southwest flashed its boarding pass to the bankruptcy show.