In House - The FindLaw Corporate Counsel Blog

December 2010 Archives

In House May be First GC to Argue Orphaned Supreme Court Case

Who brings a dead argument back to life?

On occasion, the parties to a U.S. Supreme Court case will abandon their own positions, which results in a so-called "Orphan Position." In such a situation, the U.S. Supreme Court appoints an attorney to argue on behalf of the position. To date, 42 different attorneys have been selected over the years to make such arguments. However, only one has been an in-house counsel: Adam Ciongoli, The New York Times reports.

Ciongoli is a former clerk for Justice Samuel A. Alito and the general counsel of Willis Group Holdings.

Earlier this month, Ciongoli argued to defend an 8th U.S. Circuit Court of Appeals sentencing decision. Ciongoli said being asked to make the argument was "an incredible honor and not something you say no to." Ciongoli's position was an orphan position originally held by the government, but it had later abandoned it. The case involved a ruling by the 8th Circuit that efforts by a defendant to rehabilitate himself after his initial sentence (later reversed on appeal) do not count at re-sentencing.

FBI Arrests Tech Company Executives in Apple Trade Secrets Case

Make no mistake, In House counsels need to jealously protect their employer's propriety data. Insider trading and other anti-corruption issues continue to drive this point home.

This week, federal prosecutors announced that they arrested four people and broadened their insider trading investigation regarding Apple's iPhone. Primary Global Research allegedly offered insights into industry trends, issues and regulations. The Mountain View, California-based company also allegedly revealed secrets about Apple and AMD technology to hedge funds in order to give them an unfair advantage in trading.

Consultants went so far as to establish a "corrupt clearinghouse for confidential information," New York prosecutors told the Associated Press. Primary Global executive James Fleishman was arrested and charged with wire fraud and conspiracy, and Mark Anthony Longoria, Walter Shimoon, and Manosha Karunatilaka, also face charges of conspiracy to commit securities fraud and wire fraud.

WikiLeak Lessons: New Corporate Disclosure Issues Facing GCs

General counsels are facing new corporate disclosure issues in the wake of the WikiLeaks fallout. As a recent Forbes article detailed, the scandals have attorneys and companies reconsidering their own vulnerabilities for corporate disclosure. For example, what would happen if someone from your company started leaking information to WikiLeaks? Would you be able to stop them? How damaging would the leaking of inside information be for your company? These are questions that any in house attorney should be contemplating.

Are there people in your organization that are angry, spiteful or vengeful? (Chances are that the answer is yes just about anywhere.) Whereas in the past such an employee might have taken to keying the boss' car, they now may instead turn to WikiLeaks. "Companies turn people into leakers by their failure to listen, look and respond," says business consultant and author Margaret Heffernan told Forbes.

Defense GC Jeh Johnson Writes Don't Ask, Don't Tell Plan

Don't Ask Don't Tell has been repealed. The controversial 17-year policy that banned openly gay men and women from serving in the U.S. military was repealed by a 65-31 vote in the senate just before the end of the year. The long process may meet its biggest challenge yet: implementing and integrating homosexual servicemen and women.

Hoping for a seamless integration process is the goal. Helping this process is the Don't Ask Don't Tell plan drafted by Defense Department general counsel Jeh Johnson along with Army General Carter Ham. The duo led a 66-person team in drafting the almost 300-page Pentagon study that will help guide the transition. The Don't Ask Don't Tell Plan not only looked at how ending DADT would affect troop readiness and morale, but also posed potential problems and solutions to the new issues the military may be confronted with.

Why Anti-Corruption is Top 2011 Priority for General Counsels

Anti-corruption looks to be the top priority for in house counsel in the upcoming year, according to a new study by Control Risks.

Control Risks launched its RiskMap 2011 review and forecast of business risk for the upcoming year. The review includes regional outlooks, and a rating of political and security risk in 173 countries.

So 2011 will be marked as a year of increasing national self interest, both politically and economically, as the world's emerging economies use their economic strength and resilience to project global power and influence, according to the report.

Therefore, anti-corruption efforts will be crucial, as regulators seek to prevent wrongdoing. Lawmakers throughout the world will be emboldened by new legislation, such as the UK Bribery Act and the Dodd-Frank Wall Street Reform Act.

RNC's New General Counsel: Norm Semanko

RNC Chair Michael Steele may still be struggling to hold onto his post for another term. But one position within the Republican's national committee has been set. Steele has appointed Idaho Republican Party Chairman Norman M. Semanko as RNC General Counsel. The appointment is still subject to confirmation by the National Committee.

Semanko was previously the Chair of the Idaho Republican Party, reports NewsonNews. First elected to the position in 2008, he was unanimously re-elected in 2010. Semanko was a 2008 delegate to the Republican National Convention. He is currently a member of the RNC Ethics Committee, and on the RNC Budget Committee, representing the Western Region. This is an elected position.

Goldman Sachs Brings NY Prosecutor David Markowitz In House

One high-profile N.Y. lawyer is changing teams -- and he is likely to find the new clubhouse a bit cushier than the old one.

David Markowitz, a key player on New York Attorney General Andrew Cuomo's team is headed to Goldman Sachs where he will become associate GC and a senior member of the litigation and regulatory proceedings group.

Goldman Sachs is the most profitable securities firm in Wall Street history, but that doesn't mean they won't need to draw heavily on Markowitz's experience with the AG's office as well as the SEC. As Bloomberg reports, Markowitz's last position at the SEC was assistant regional director, handling, among others, insider-trading cases.

Although Goldman settled fraud charges in July with the SEC (for a cool $550 million), there are others still pending. Reportedly, an investigation is underway regarding Goldman bankers allegedly leaking information about health-care transactions to help several investors.

Qwest In House Hates Flat Fees, Alternative Fee Arrangements

To flat-fee or not to flat flee, that is the question.

Or at least, that is the question addressed recently by out-going Qwest Communications GC, Richard Baer. Baer recently addressed the flat fee and alternative fee arrangements with outside counsel that are becoming so popular with the in-house crowd.

Baer's opinion? He turns the idea of alternative fee arrangements down flat.

Before Filing for Bankruptcy, Pay Your In House $100K

Word to the wise: before filing for bankruptcy, pay your In House Counsel $100,000 for a job well done. Although financial services company Ambac cited a whopping $1.7 billion in debt in their recently-filed Chapter 11 bankruptcy, the company managed to settle up with their In House Counsel Kevin Doyle shortly before filing the petition.

Kevin Doyle was paid $100,000 in "recognition of his efforts to maximize the company's cash position, thereby assisting the company in its efforts to emerge successfully from Chapter 11 bankruptcy proceedings." Generous? Yes.

The right thing to do? Questionable.

Lawyer Who Masterminded Vioxx Defense Named Merck CEO

What's the prize for winning the Vioxx defense cases for a major pharmaceutical company, saving millions of dollars in potential damages? C-E-O.

Kenneth C. Frazier has been named the new CEO of Merck & Co. and will receive $1.5 million plus incentives. In addition, the new Merck CEO will receive a bonus of up to 150 percent of his base salary and a long term incentive grant for a cool $7.5 million, including stock options. Merck filed the change with the Securities & Exchange Commission, Business Week reports.

Are In House Counsel Bonuses Designed for Long Haul?

As noted in a post on FindLaw's Greedy Associates, the season of rejoicing that is bonus season has arrived. Will in-house counsel have the same reasons for gladness as their outside colleagues, or perhaps even more?

Some say the in-house bonus system leads to more long term benefit, while firms, especially BigLaw, are set up for an entirely different purpose.

The bonus structure is different in BigLaw firms than in-house say the folks at Law Shucks. According their premise, the BigLaw bonus system is based on the idea that associates should be kept minimally happy until their third or fourth year at which time the investment in them is recouped and they can be replaced. 

Some evidence for this is found, according to Law Shucks, in the fact that few BigLaw bonuses are tied to performance.

Apple Beefs Up Legal Team, Adds In House for Nokia Suit

When the going gets tough, the tough call in intellectual property rights specialists. Or something like that...

Apple is calling for legal backup in its intellectual property dispute with Nokia.

The computer and technology company has hired a team of patent attorneys as well as an  in house counsel. Apple's general counsel, Bruce Sewell, was hired after working for 15 years at Intel. As for outside counsel, Apple's legal team is being advised by William Lee, who won the Broadcom lawsuit against Qualcomm.