The BLT: The Blog of Legal Times

Judge Thomas Flannery Dies at 89

Judge Thomas A. Flannery, the District’s U.S. attorney in the late 1960s who went on to serve for more than 30 years on the bench of the U.S. District Court for the District of Columbia, died Thursday morning, according to a court spokesman. He was 89.

Flannery assumed senior status in 1985. Here is an interview the judge gave to the Historical Society of the District of Columbia Circuit in Feb. 1992 in which he describes his experiences growing up in the District (he lived about four blocks from the federal courthouse), serving as an intelligence officer in Europe during WWII and rising through the ranks in the U.S. Attorney’s Office. And, of course, he discusses his time on the bench, during which he heard hundreds of cases, including the controversial civil rights trials in North Carolina involving the Ku Klux Klan (Chief Justice Warren Burger asked him to parachute in, after the local judges recused themselves) and the Exxon Corporation oil-price scamming case in the 80s. The government won, and Flannery ordered the company to pay back $1.5 billion in overcharges.

Flannery graduated from Columbus Law School, now part of Catholic University, in 1940, and was drafted to serve in the Air Force in early 1942. Upon his return from the war, he joined the Justice Department in the Lands Division. He was hired into the U.S. Attorney’s Office in 1950, which he described as “the turning point in my legal career.” He left the office in 1962, taking a job at Hamilton and Hamilton. He was named U.S. Attorney for the District of Columbia in 1969. and two years later, he was nominated to the federal bench.

"Judge Flannery was a highly respected judge of this Court and a beloved member of the Court family. He will be missed greatly," said Acting Chief Judge James Robertson.

Randall Lee Moves to Wilmer

WilmerHale is opening up a Los Angeles office and has picked up Randall Lee, the former director of the Pacific Region for the Securities and Exchange Commission, to head the new shop. Lee formally joined the firm yesterday after spending six years in charge of the SEC’s enforcement and examination programs in nine states on the West Coast.

William Perlstein, the firm’s co-managing partner, says that the firm has been eyeing L.A. for a long time and plans to focus the office on securities work, IP litigation, and white-collar in the balmy, traffic-snarled city. All the better to help out the firm’s big tech clients like Cisco, Disney, Intel, Broadcom, and Google.

At first, Lee will work out of the firm’s Palo Alto office until the L.A. office is complete at beginning of next year. And Lee won’t be the only Wilmer representative in L.A. for long. The firm has been approached by potential laterals interested in the new L.A. operation, and it plans to move over a few partners from the East Coast as well. “I would expect that we would have additional announcements over the next several months,” say Perlstein.

Deal Flow

■ A team from Hogan & Hartson handled a $492 million acquisition by Paetec Holdings Corp. of telecom provider McLeodUSA. The deal establishes New York’s Paetec as one of the largest rivals to AT&T Inc. and Verizon Communications for business-telephone services.

Hogan’s team was led by corporate partners Richard Parrino, Thomas Repke, and J. Brent Singley, who practice in the firm’s Northern Virginia office. Tax partner Daniel Davidson and executive compensation partner William Neff also pitched in on the deal from the Washington office.

“We’ve represented them since they began operations in 1999,” Parrino says.

Once the deal is finished, Paetec is expected to have roughly 3.4 million access lines. It will also have 17,000 miles of fiber-optic routes, and new access to cities such as Cleveland, Dallas, Houston, and Seattle.

■ Hogan was also in on a deal involving Germany-based biopharmaceutical company Biotest, which agreed to acquire Boca Raton, Fla.-based Nabi Biologics for $185 million. The deal gets Biotest into the plasma protein business. The transaction is expected to close in December. Working on the deal were Washington area partners Michael Williams (corporate), Kevin Clayton (business finance), Joe Gilligan (corporate), William Neff (executive compensation), and Robert Brady (Food and Drug Administration).

■ Covington & Burling advised New Zealand’s largest transport and logistics company, Mainfreight Ltd., in its buyout of Target Logistics Inc., a U.S.-based company. Mainfreight paid $53.7 million. It operates in New Zealand, Australia, Asia, and the United States. Partner Jack Bodner led the Covington team out of New York. The Washington contingent was composed of transportation partner Linda Morgan, employee benefits partner Michael Francese, environmental partner Theodore Garrett, IP partner Lee Tiedrich, and antitrust partner George Chester.

■ Lawyers from WilmerHale helped broker MediaTek Inc.’s $350 million purchase earlier this month of cellular chip assets from Analog Devices Inc. The WilmerHale team worked for Analog, which is based in Norwood, Mass. MediaTek, Taiwan’s largest chip designer based on revenue, is targeting China’s burgeoning telecommunications market. The deal was led by corporate partners Mark Borden and Jeffrey Stein out of Boston. Communications and e-commerce partner Lynn Charytan (Washington) also worked on the deal.

■ Chadbourne & Parke represented GoAmerica Inc. in a merger with Hands On Video Relay Services. The agreement, announced last week, is for $35 million cash and 6.7 million shares of GoAmerica common stock, which brings the total value to roughly $69 million. Washington corporate partners Dana Frix and Michael Salsbury and New York partners Bill Cavanagh (tax) and Marjorie Glover (employment) led the team.

News From London

A move across the Atlantic of note: Mayer Brown last week lured William Charnley from the London office of McDermott Will & Emery. Charnley, a private equity and hedge fund partner, helped open McDermott’s London office in 1998.

Charnley starts October 1 in Mayer Brown’s London office and will be charged with building the private equity practice.

A New Constitution?

Constitutional scholar Sanford Levinson of the University of Texas spoke last night at Akin Gump about how the Constitution contributes to "the contemporary crisis of American politics."

Levinson, discussing material from his recent book, said that his focus was not on the 10 percent of constitutional issues being litigated, but rather on the 90 percent that are not disputed yet have a significant effect on American democracy. His examples included the disproportionate influence in the Senate of less-populated states, the president's veto power that Levinson contends effectively creates a tri-cameral legislature, and the fixed-term presidency that allows a president to remain in office even when a majority of the population lacks confidence in his judgment on matters of life and death.

Levinson's solution would be a new constitutional convention to address these structural issues. He acknowledges that this is "highly unlikely to happen," but Levinson wants to warn people about the need, somewhat like Paul Revere (when Levinson is being optimistic) or Cassandra (more pessimistically).

K&S Raids Kilpatrick Stockton

Last month King & Spalding’s D.C. office didn’t have an intellectual property practice. Kilpatrick Stockton did. So King & Spalding decided to conduct a little raid. Three former Kilpatrick partners, including the
firm’s D.C. managing partner, George Marcou, started last Monday in King & Spalding’s intellectual property group as patent prosecutors. Marcou brought with him partner Dawn-Marie Bey, and partner-elect Michael Dimino.

But King & Spalding wasn’t done there. They also scored seven members of Kilpatrick’s government relations practice, who made the jump to King & Spalding’s government advocacy and public policy group. Partner Christopher Ott, who led Kilpatrick’s government relations group, brought with him associate William Clarkson, government relations adviser Tara Chapman, and senior government relations advisers John Howell, Michael Rishling, Arch Galloway, and Dan Hickey.

The pilfering comes six months after three partners in King & Spalding’s corporate transaction group bolted for Hogan & Hartson. King & Spalding D.C. office managing partner J. Sedwick Sollers III says he’s still “on the lookout” to rebuild the corporate group. In the meantime, he says building up the IP practice is part of a “strategic direction, both from a firm standpoint and from the standpoint of diversifying this office.”

As for Kilpatrick Stockton, the firm's D.C. managing partner Stephen Baskin says he plans to re-grow both the IP and government relations practices in his office soon.

More on this in the Keeping Score section of next week's Legal Times.

New Survey: D.C. Firms Lag

This just in: Skadden, Arps, Slate, Meagher & Flom is the standard-bearer among corporate law firms. The unsurprising news was confirmed in a recent survey of corporate in-house counsel by BTI Consulting Group, which asked, among other things, what firms were getting the most work.

“There isn’t a category where Skadden isn’t a lead player,” says Michael Rynowecer, president of Wellesley, Mass.-based BTI. “They are the only firm where they stand out in every part of the survey.”

BTI’s research identified eight other firms as power players in the transactions market: Baker & McKenzie; Jones Day; Mayer Brown; McDermott Will & Emery; Sidley Austin; Simpson Thacher & Bartlett; Wachtell, Lipton, Rosen & Katz; and Vinson & Elkins.

As for Washington-based firms, let’s just say they aren’t leading the pack. Only five locals cracked the top 100, and all were relegated to the survey’s bottom tier. But according to Rynowecer, Covington & Burling and WilmerHale are making headway.

“Washington firms aren’t a player yet in this market,” says Rynowecer. “Covington [& Burling] and WilmerHale are getting to the table. But they’re not getting the deals yet.”

Covington’s managing partner, Stuart Stock, says his firm is coming along in this area. “We are growing our M&A and transaction practices quite nicely, especially in life sciences and sports-related deals,” says Stock. “Transaction work is very important to us. It’s one of the three legs of our stool: litigation, regulatory, and transactions.”

The other Washington firms to make the top 100 were Hogan & Hartson, Crowell & Moring, and Venable.

The BTI study is based on 150 interviews with transactional corporate counsel at Fortune 1000 companies and companies with more than $1 billion in revenue.

Morning Wrap

Lawsuit Begets Reforms: A District of Columbia task force assessing the city's emergency response capabilities after the slaying of a New York Times reporter in 2006 on Thursday recommended better leadership, cross-training and evaluations, the WaPo reports. It did not advocate -- as was once suggested -- that the D.C Fire and Emergency Medical Services be split into two agencies. The task force was born out of a legal settlement between the city and David Rosenbaum's relatives, who agreed to put aside a $20 million lawsuit in exchange. Rosenbaum, 63, was mugged after going for an evening stroll in January 2006. Emergency responders misdiagnosed him as drunk, and he died two days later. A subsequent investigation revealed he had been hit in the head with a pipe. Here's the WaPo's 2006 lawsuit story.

Campus Shooter Sought: Delaware State University in Dover is under lock-down mode this morning and classes have been suspended after a shooting left two students wounded, CNN reports. The male student is listed in stable condition while his female counterpart is in serious condition. The shooting occurred about 1 a.m. near Memorial Hall and comes five months after the Virginia Tech University tragedy, in which a gunman fatally shot 32 people before killing himself.

O.J.'s Counsel: O.J. Simpson's celebrity status and brushes with the law have elevated the career of a once-unknown Miami criminal defense attorney. TIME has this exclusive profile of New Jersey native Yale Galanter. "He was a nobody until he represented O.J. on a case that never should have gone to trial," says one Miami-based prosecutor of Galanter and Simpson's road-rage trial in 2001.

More Trouble for NY Firm: When it rains, it pours. The feds on Thursday indicted Melvyn Weiss, the co-founder of Milberg Weiss, in connection with allegations that the firm made $250 million the last 25 years by employings paid plaintiffs on call in class-action suits, the NYT reports. Weiss, 72, faces charges of conspiracy, racketeering, obstruction of justice and lying to a federal grand jury. Yesterday, the Department of Justice also announced former partner Steven Schulman has agreed to plead guilty to a conspiracy charge and cooperate while Weiss' ex-associate, William Lerach, pleaded guilty to a similar charge earlier this week. Court records show investigators relied on the testimony of yet another former partner, David Bershad, to bolster their case against Weiss.

Fraud and Waste: Department of Defense officials on Thursday disclosed that they are investigating $6 billion in contracts in Iraq and Afghanistan, the AP reports via CNN. Thomas Gimble, the Pentagon's deputy inspector general, told members of the House Armed Services Committee there are 225 investigators considering criminal misconduct allegations as a result of 90 investigations and 29 audits. Gimble and others attribute the impropriety to a handful of "bad apples".

Does the "Betray-Us" Ad Betray Us?

At a news conference this morning, Pres. Bush made his first public remarks about the controversial Moveon.org ad that dubbed Gen. Petraeus, “Gen. Betray Us.” In the full-page NYT ad, the anti-war group alleged that the general is fudging the facts on Iraq to do the president’s bidding. Bush slammed Democrats for not denouncing the ad, contending that they’re more “afraid of irritating a left-wing group like Moveon.org…than they are of irritating the United States Military.” You can read more about the news conference here.

But was the ad really that outrageous? The WaPo’s “Fact-Checker” will take you through it, point-by-point, to weigh Moveon.org’s claims against other reports. In the end, the “Betray Us” ad earned a rating of three Pinocchios out of four. Translation: It didn’t stand up so well. Take a look for yourself to see why.

Just in: Chief Justice Back in the Stoneridge Case

The Supreme Court just announced that Chief Justice John Roberts Jr. has reentered the closely watched case of Stoneridge Investment Partners v. Scientific-Atlanta, which will be argued Oct. 9. He and Justice Stephen Breyer had recused in the case, undoubtedly because they owned stock in Cisco Systems Inc., the parent company of Scientific-Atlanta, according to their financial disclosure forms. The news almost certainly means that Roberts has sold the stock to cure the conflict of interest.

In this Legal Times story last month, we reported on the possibility that one or more of the justices would "unrecuse" to insure that the case is decided by more than a seven-member Court. Roberts made a similar move last term in the case of Credit Suisse v. Billing.

The case has drawn wide attention from the business community since it could increase the libaility of law firms and other "third parties" in investor class action suits alleging fraud. The Securities and Exchange Commission wanted to side with the investors, but Solicitor General Paul Clement filed a brief on the other side urging the Court not to expand liability for secondary actors. During speculation over whether Roberts and/or Breyer would "unrecuse" it was generally agreed that if one or both did rejoin the case, it would help the cause of businesses seeking to limit liability.