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Law Firm Clients Defeat Bankruptcy Trustees in New York Court of Appeals
The New York Court of Appeals, on July 1, 2014, in response to questions certified by the U.S. Court of Appeals for the Second Circuit, held that “pending hourly fee matters are not [a dissolved law firm's] 'property' or 'unfinished business'” under New York's Partnership Law. In re Thelen LLP, _________ N.Y.3d _________, 2014 N.Y. LEXIS 1577, *1 (July 1, 2014). See In re Thelen LLP , 213 F.3d 213, 216 (2d Cir. 2013). A federal district court had applied California law to reach the same conclusion in a similar case three weeks earlier. In re Heller Ehrman, 2014 U.S. Dist. LEXIS 81087, *2 (N.D. Cal. June 11, 2014) (“A law firm ' and its attorneys ' do not own the matters on which they perform their legal services. Their clients do.”)
The bankruptcy trustees of two dissolved law firms (Thelen LLP and Coudert Brothers) raised the issue when they sought to recover profits that other law firms had earned on hourly fee matters brought to those firms by departing Thelen and Coudert partners. According to the trustees: 1) pending hourly fee matters that were taken to the new firms were Thelen and Coudert property; and 2) the new firms had to account for their earnings on those matters. As The Wall Street Journal noted on July 7, 2014, the trustees were trying to “claw back money earned on pending matters for the benefit of [the dissolved firms'] creditors.”
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.