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Some answers, more questions in gun case

  Legal Outlook  -   POSTED: 2008/06/27 03:00
The Supreme Court embraced a personal right under the Constitution to have guns for self-defense. But in its historic examination of the Second Amendment, the justices left unanswered whether gun rights extend beyond the home or how far.

The court split ideologically in its decision Thursday striking down the District of Columbia's ban on handguns. Each side, however, agreed it will take many lawsuits to spell out fully the right to keep and bear arms.

Justice Stephen Breyer, in dissent with three other liberal justices, gloomily said the decision "threatens to throw into doubt the constitutionality of gun laws throughout the United States."

Indeed, gun rights supporters said they would bring legal challenges aimed at local, state and possibly federal restrictions.

The Washington case "is merely the opening salvo in a series of litigations that will ultimately resolve what weapons and persons can be regulated and what restrictions are permissible," said Robert Levy, the lawyer who helped craft the case against the capital's gun ban and financed the suit and appeals.

"Because of Thursday's decision, the prospects for reviving the original meaning of the Second Amendment are now substantially brighter," Levy said.

The National Rifle Association, which opposes almost all gun restrictions, used similar language in praising the court's ruling.

Yet Justice Antonin Scalia, who wrote the majority opinion that his four conservative colleagues joined, observed that the court was not examining a variety of long-standing restrictions. They include laws that prohibit concealed weapons; bar felons and the mentally ill from owning guns; or ban firearms in schools or government buildings.

Big-city politicians took some solace in Scalia's list, which he said was not exhaustive. They hoped licensing requirements also might pass constitutional muster.

The court left in place that aspect of Washington's regulations of guns because Dick Anthony Heller, 66, the armed security guard who sued for the right to have a handgun at home, did not contest the licensing requirement at the Supreme Court. The justices had no occasion to rule on it.

The licensing issue is among the most important to be answered in the future. So is the question whether the Second Amendment even applies to state and local governments, or only guarantees rights against unreasonable federal interference.

Most of the Bill of Rights has been held to apply to the states. But Scalia and Justice Clarence Thomas have been skeptical about applying others.

Among proponents of gun control measures are some who believe the decision could mark a symbolic high point for the gun rights movement, but lead to diminished influence.

"For 40 years, the NRA has opposed nearly all proposed gun laws on constitutional grounds," said Jim Kessler, vice president for policy at the centrist group Third Way. "The Supreme Court just told them to get a new argument."

Mark Tushnet, a Harvard Law School professor who last year wrote a book about the battle over guns, said the ruling probably will eliminate the "slippery-slope" argument that gun control laws will lead to confiscation of guns.

"This decision takes gun confiscation off the table. So they won't be able to capitalize on that kind of argument any more," Tushnet said,

Legal challenges may rage for the next five to 10 years before the reach of the Second Amendment is clear, Tushnet said.

By that time, of course, the makeup of the Supreme Court is likely to be very different.



The collapse of the subprime-mortgage market has turned into a legal free-for-all not seen in the financial-services industry since the savings-and-loan crisis.

Last year, 278 subprime-related civil cases were filed in federal court, equaling half of the 559 S&L cases handled by the Resolution Trust Corp. from 1989 to 1995, according to Navigant Consulting Inc. The study does not include suits filed in state courts.

"The S&L crisis has been a high water mark in terms of the litigation fallout of a major financial crisis," said Jeff Nielsen, managing director of Navigant Consulting. "The subprime-related cases appear on their way to eclipsing that benchmark."

Virtually every participant in the meltdown is being sued: Brokers, lenders, appraisers, home builders, bond underwriters, bond insurers and money managers, among others.

And the suits keep coming in 2008, according to anecdotal evidence, as the number of foreclosures escalates and financial institutions suffer more losses. Estimated losses from the subprime mess could amount to close to $400 billion, not including litigation costs.

With that kind of fallout, it could take years to unclog the courts.

Borrower class-action suits made up the biggest chunk of cases last year (43 percent), with claims that they were the victims of illegal or abusive lending practices.

Within this category of borrower suits, however, are some atypical defendants. For instance, two California couples have accused home builder KB Home of conspiring to inflate prices by generating fraudulent appraisals.

Even cities with high foreclosure rates want someone to blame. The City of Cleveland has sued 21 investment banks, including Goldman Sachs, Merrill Lynch and HSBC, alleging they created a public nuisance by investing in subprime loans.

Similarly, Buffalo is suing 28 lenders in hopes of getting them to take responsibility for abandoned properties in the city.

"There are some creative lawsuits out there, some would say frivolous," said Richard Gottlieb, a Chicago lawyer who represents lenders in litigation.

Gottlieb leads a practice of 41 lawyers at the Dykema law firm that is busier than usual despite the loss of some big clients, such as mortgage lender New Century Financial Corp., to bankruptcy.

The surge in litigation has left other firms scrambling to decipher the complexities of subprime lending and the related securities issued by investment banks that bundled the mortgages into bonds. Securities cases accounted for 22 percent of the filings. Firms are looking to capitalize on new opportunities, as other areas of commercial litigation cool off.

Besides litigation, firms are being called on to advise clients involved in regulatory investigations. Federal and state authorities, including the Illinois attorney general, have launched probes into predatory lending practices.



That was the question posed Friday by Dechert’s James Beck and Jones Day’s Mark Herrmann, co-authors of the well-read Drug and Device Law blog. Given that, for instance, Drug and Device scores 25,000 page views per month, “wouldn’t you expect at least a few of your colleagues to wander down the hall and ask two questions: (1) How did you do it? and (2) How can we replicate it?” ask Beck and Hermann. “Our firms surely benefit indirectly from the attention that this site receives. Wouldn’t our firms also benefit if they were affiliated with (or even sponsored) the most widely read securities law blog on the internet? Intellectual property blog? Tax law blog?” So why, ask Beck and Herrmann, are so many firms indifferent or unsupportive of their lawyers’ blogging efforts?

They propose four possible answers:

“Most widely read product liability blog” = “World’s tallest midget”: 25,000 pageviews is a drop in the bucket, and there’s essentially no institutional benefit to blogging. If the two of us — Beck and Herrmann, the blogging morons — want to waste our Saturday mornings feeding this beast, we should go ahead and entertain ourselves.

Power of blogosphere eludes firm management: Management is basically folks over 50 who start their days sipping a cup of coffee and reading the Journal. Only people under 40 start their days sipping a cup of coffee and checking [legal blogs].

Blogs attract the wrong eyeballs: The target market for big firms such as ours is the general counsel and C-level management of Fortune 500 companies. With all due respect to our visitors — and we love you guys; really! — you folks are younger and less important.

Where’s the money in this? It takes many hours of effort each week for the two of us to provide regular, fresh content to this site, and the amount of business generated doesn’t justify the effort. If the two of us get some personal satisfaction from blogging, no one will interfere, but firms do cost-benefit analyses of marketing initiatives, and this one flunks the test.

What do the leaders of Dechert and Jones Day have to say about the commentary? We’ve reached out to both firms and will let you know if we hear back.



US court's review puts stay on executions

  Legal Outlook  -   POSTED: 2007/11/06 04:58

It is not official, but a 'creeping moratorium' on the death penalty in the United States is taking hold as the country's Supreme Court prepares to hear a challenge to the method of lethal injection. The latest inmate to win a reprieve was Earl Wesley Berry of Mississippi, whose execution was stayed last Tuesday by the US Supreme Court just 19 minutes before he was scheduled to die. He had already eaten his 'last meal'. Support for the death penalty remains strong in the US, one of only a handful of democracies that still carries out capital punishment.

But the unofficial hold on executions comes amid a steep decline in the number of death sentences imposed and rising concern about wrongful convictions.

'All of this suggests that the death penalty is under a significant review in a way that we haven't had in almost four decades,' said Jordan Steiker of the University of Texas at Austin School of Law.

October 2007 was the first October since 1989 without a US execution and the first month without one since December 2004; December is a typically quiet month in the death chambers because of a reluctance to execute near Christmas.

If the moratorium holds until at least the end of this year, the US will have executed 42 inmates in 2007, the lowest number since 1994, when 31 were put to death. If it does not hold, the execution rate is still seen slowing to a trickle.

Around a dozen condemned prisoners have been granted stays since the Supreme Court announced on 25 September that it would decide an appeal by two death row inmates from Kentucky, arguing that the three-chemical cocktail used in lethal injections inflicted unnecessary pain and suffering.

One convicted killer was executed in Texas hours later, but legal observers said his case slipped through partly because of the timing of the announcement.

The top US court itself subsequently postponed an execution in Texas, the most active death penalty state by far with 405 since 1982. Two other stays have since been granted in Texas by state courts.

Judges or governors in Alabama, Georgia, Virginia, Nevada, Arkansas and Arizona have also granted stays. Oklahoma's attorney general last month asked the State Court of Criminal Appeals not to set any more execution dates until the US high court rules on the Kentucky challenge.

All of the stays were directly related to the US Supreme Court's review. It is not expected make a ruling before June.

Since it is the three-drug mixture used in lethal injection that is being challenged and not the practice itself, states could in theory come up with an alternative cocktail or method - but experts believe that is unlikely.

Enthusiasm for the death penalty appears to be fading, partly because the option of imposing life without parole has become more widely available to juries in recent years.

Lethal injection has come under increased scrutiny after executions in Florida and California in which inmates took up to 30 minutes to die. All but one of the 37 states with the death penalty and the federal government use lethal injection for executions.

The number of death sentences imposed in 2005 - the last year for which there is complete data - was 128, way down from 317 in 1996.

'In states which are more ambivalent about the death penalty I think you will see this de facto moratorium become a permanent one,' said Sarah Tofte, a researcher with the US programme at Human Rights Watch.

One of the main concerns is wrongful convictions. No US court has found that anyone has been executed in the past three decades for a crime he did not commit, but DNA and other evidence has exonerated dozens of inmates who were awaiting execution on death row.

The American Bar Association said last week it was renewing its call for a nationwide moratorium on executions, based on a three-year study of death penalty systems in eight states that found unfairness and other flaws.

The study identified concerns such as racial disparities and shoddy defence services for lower-income defendants.

Supporters of capital punishment often argue that the lengthy appeals process - inmates spend an average of over a decade on death row before they are executed - and the exonerations themselves highlight the fairness of a system that they say gives justice to victims.



Fallen lawyer mastered political system

  Legal Outlook  -   POSTED: 2007/09/23 09:45

During the peak of his power, William S. Lerach was feared and despised by Silicon Valley executives, not just for his shareholder lawsuits against them but also for his mastery of the political system. The San Diego lawyer did something that high-tech executives didn't: He systematically donated to politicians. During his more than three decades as a donor, Lerach and members of his two law firms have given millions of dollars to officeholders and candidates, almost all Democrats, including a president, senators, governors and even Assembly members.

Lerach, 61, has helped elect people who share his belief in keeping the courtroom doors open for shareholder lawsuits.

But his most important legacy as a political player may be that he spurred his enemies in the high-tech industry to become a political powerhouse in their own right.

Lerach – who pleaded guilty in a plaintiff-kickback scheme Tuesday – had a deserved reputation for being aggressive not only in court, but also in the political system, where he sought to tilt the rules in favor of his law business. High-tech executives felt they had no choice but to get on the playing field.

As a result, technology companies have transformed national politics into a more friendly environment for their agenda of increasing visas for skilled foreign workers, opposing Internet taxes and overhauling education. Their early backing of Democrats gave the party a new source of campaign cash and something that had seemed largely the province of Republicans: business support.

Some technology company leaders trace Silicon Valley's new clout to December 1995, when Lerach was seen talking with President Bill Clinton at the White House.

A few days later, Clinton vetoed legislation that would limit the type of shareholder suits that made Lerach and his former law firm wealthy.

His former law firm, Milberg Weiss, typically filed fraud suits against companies that had experienced a sharp drop in their stock prices, which frequently occurred among volatile high-
tech companies. Companies often settled out of court.

Lerach and his allies saw Clinton's veto as good policy to help investors battle corporate fraud.

But high-tech executives saw the veto as a blunt power play by a lawyer with extraordinary political influence.

“It was an eye-opener for Silicon Valley when they saw that the Clinton administration had good relations with this guy,” said Sean Garrett, who works for a high-tech communications company, 463 Communications.

Eventually, Congress overrode the veto, with the support of many Democrats and Republicans.

Lerach wasn't deterred.

A few months later, in 1996, his law firm spent millions of dollars to qualify a measure for the state ballot, Proposition 211, which would have made it easier to file shareholder suits in California courts.

As high-tech executives worked to defeat the measure, they realized they needed a permanent political presence.

They sought to counteract Lerach's influence by forming TechNet, an organization to push the technology agenda in Sacramento and Washington, D.C.

“It was the day that Silicon Valley grew up,” Garrett said. “Before then they were completely ineffectual and uninvolved. They weren't organized.

TechNet helps provide sympathetic politicians with the technology industry's stamp of approval. Garrett, who works for TechNet, said Lerach was the spark that lit the fire under Silicon Valley.

During the Proposition 211 campaign, software entrepreneur Tom Proulx told the Recorder, a San Francisco legal newspaper, that “politics is a cultural anathema to Silicon Valley” because executives were busy building their companies.

But, Proulx said, “people are finally starting to realize that it's a game we have to play.”

Since then, high-profile executives, including venture capitalist John Doerr and Cisco Systems Chief Executive Officer John Chambers, have become state and national political figures.

During the 1994 election cycle, officials in the computer industry ranked 41st among industry groups in their donations to federal candidates, contributing $4.6 million, according to the Center for Responsive Politics. By the 2000 cycle, the high technology industry had leaped to eighth place, donating $39 million, according to the center.

“Silicon Valley has taken its place alongside Hollywood and Wall Street as a must-stop area for politicians,” Garrett said.

Unlike Lerach, technology companies generally give to Democrats and to Republicans.

But even many Democrats believed Lerach had gone too far with Proposition 211. President Clinton, U.S. Sen. Dianne Feinstein and then-Senate President Pro Tempore Bill Lockyer, who is now the state treasurer, all came out against the measure. It was easily defeated.

Tech companies began to be more politically active, while Lerach continued to be a major donor.

During the past two decades, Lerach and his family have contributed more than $1.6 million to federal candidates and hosted a fundraiser for President Clinton at his Rancho Santa Fe home.

He has also given hundreds of thousands of dollars to state officials, including more than $200,000 to former Gov. Gray Davis, a Democrat.

Lerach was so notorious among executives that Republican gubernatorial candidate Dan Lungren briefly made him a 1998 campaign issue.

Lungren claimed that Davis might appoint Lerach to the state Supreme Court, a claim that wasn't taken seriously. For one thing, it would have forced Lerach to take a pay cut of many millions of dollars each year.

Last week, Lerach pleaded guilty to conspiracy while at his old firm of Milberg Weiss for participating in a scheme to pay kickbacks to recruit plaintiffs for 150 class-action lawsuits against U.S. companies.

He agreed to forfeit $7.75 million in unlawful gains, pay a $250,000 fine and accept a prison sentence ranging between one and two years.



Redding on Federalism and "Personal Law"

  Legal Outlook  -   POSTED: 2007/04/12 21:53



Jeff Redding (Yale Law School) has posted Slicing the American Pie: Federalism and Personal Law on SSRN.  Here is the abstract:

In this piece, I draw upon Indian and other comparative legal experience to argue that the present U.S. system of territorial federalism resonates deeply with those systems of "personal law" that are commonly found around the world. Under a personal law system, a state enforces different laws for each of the state's different religious or ethnic communities - which is one reason such systems have been so heavily interrogated by U.N. and other international organisations for their human rights implications. Similarly, as well, U.S. First Amendment jurisprudence has frowned upon the carving out of religious-group exceptions to generally-applicable law. That being said, the U.S. Supreme Court has also recently given renewed emphasis to state sovereignty and other federal values. As this piece argues, what results from this worship of federalism is a truly American-style personal law system, where territorial communities have taken the place of other personal law systems' religious and ethnic communal constituencies. This being the case, I conclude by questioning recent innovations in American constitutional jurisprudence which devalue religious pluralism, while simultaneously elevating territorial communalism.

http://www.law.yale.edu/faculty/JRedding.htm



Chamallas on Discrimination Torts

  Legal Outlook  -   POSTED: 2007/04/12 21:50



Martha Chamallas (Ohio State University - Michael E. Moritz College of Law) has posted Discrimination and Outrage: The Migration from Civil Rights to Tort Law (William & Mary Law Review, Vol. 48, No. 6, 2007) on SSRN. Here is the abstract:

It is not always appreciated that proven discrimination on the basis of race or sex may not amount to a tort and that even persistent racial or sexual harassment may not be enough to qualify for tort recovery. This Article explores the question of whether discriminatory and harassing conduct in the workplace is or should be considered outrageous conduct, actionable under the tort of intentional infliction of emotional distress. In recent years, courts have taken radically different approaches to the issue, from holding that such claims are preempted to treating the infliction tort as a reinforcement of civil rights principles. The dominant approach views tort claims as mere "gap fillers" that should come into play only in rare cases that do not fit comfortably under other recognized theories of redress.

To place the current approaches in perspective and determine the proper location for harassment claims, this Article analyzes the respective domains of torts and civil rights, discussing the prototypical harms and animating philosophies behind the two regimes. It provides a history of the intentional infliction tort—with particular emphasis on how early courts and commentators treated issues of gender, race, and sexuality—and explains a new scholarly turn toward universalism and protection through common law. The Article identifies major innovations in the development of the hostile environment claim to ascertain which basic principles could be transported to tort law. This Article concludes with a critique of the "gap filler" approach and an argument for adapting the limited migration approach of the new Restatement of Torts to allow emerging norms from civil rights to influence the adjudication of tort claims.

http://moritzlaw.osu.edu/faculty/bios.php?ID=10



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