The BLT: The Blog of Legal Times

New Leadership in Reed Smith's D.C. Office

Reed Smith announced several leadership changes in its Washington area offices today.

A. Scott Bolden will take over from James Gallatin Jr. as D.C. managing partner. Bolden has been at the firm since 1991. In addition to his new position, he will also continue his practice in complex civil and criminal defense litigation. Bolden is a past chairman of the D.C. Democratic Party, past president of the District of Columbia Chamber of Commerce, and has been active in a number of other local organizations. In a press release, Bolden said he is happy to give back to Reed Smith by taking on a leadership role, especially since the firm has always supported his community involvement.

Former D.C. managing partner Gallatin will become the firmwide head of regulatory litigation. Gallatin became managing partner of the office in 2004. Prior to that, he was Virginia managing partner.

Partner Alexander Thomas, who is based in the Falls Church, Va. office, has been named head of Reed Smith’s new Eastern commercial litigation group. The group is part of the firm’s overall litigation team, which also includes Western, Midwestern, and Europe-Middle East commercial litigation practices.

This Week in In-House Counsel

When a law firm discounts its standard billing rate, is it really such a good deal for the client? Consultant Rees Morrison is suspicious of discounts on legal fees as a cost-control tool: “Law firms still enjoy a cost-plus arrangement, inducements to pad law firm bills are everywhere, and in-house lawyers must still flyspeck long bills."

Conducting e-discovery in a flood of digital data poses challenges for both domestic and international arbitration. But a good procedural protocol can help arbitration succeed, write C.R. Ragan and Robert Copple.

And if the company is facing a litigation onslaught, the best choice is often not to buy peace (i.e., settle). Instead, you have to fight to win, argues Joseph Speelman.

Firms Getting in the Green Spirit

Firms are getting in the green spirit today, in celebration of Earth Day.

Sonnenschein Nath & Rosenthal launched an “environmental sustainability policy” to make its business practices more environmentally sound. The policy was developed by a 100-person task force, led by Washington partner Thomas Jensen. Among the initiatives that it sets forth is a commitment to work with office suppliers, vendors, and office building managers to ensure that the goods and services provided are environmentally friendly.

Brown Rudnick Berlack Israels sent out an announcement touting its signing of the “Massachusetts Bar Association’s Lawyers Eco-Challenge.” The Massachusetts Bar and the Conservation Law Foundation launched the challenge in January to encourage firms to conserve energy and resources.

Find out more about the overlap between firms and environmental sustainability in Legal Times’ Going Green special report.

More on Nelson Mullins' New Hires

Yesterday the Influence blog reported the departure of Holland & Knight's education policy practice for Nelson Mullins Riley & Scarborough. The number of lobbyists and attorneys is greater than previously reported: According to Scott Palmer, a leader of the group, ten professionals are making the hop. And they won't just be another practice group at the firm. The group's current expectation is that they'll be an independent shop affiliated with Nelson Mullins.

As Holland & Knight lobbying practice head Rich Gold suggested yesterday, the principal reason for the departures was the group's interest in working with Clinton administration Secretary of Education Richard Riley, says Palmer. Both he and Art Coleman worked under him, and the prospect of forming a new policy group "created an opportunity to put together what we'd built with his experience, knowledge, and reputation," Palmer says.

Morning Wrap

Conflict of Interest: Former Justice Department official, lawyer Robert Coughlin II, was charged late yesterday with aiding an associate of Jack Abramoff while negotiating a possible job and accepting expensive sports tickets. He is expected to plead guilty to felony conflict of interest in D.C. federal court, reports the WSJ.

MoFo: Morrison & Foerster is representing soldiers home from Iraq and Afghanistan who say the Department of Veterans Affairs has not provided sufficient services. Bench trial in the case began yesterday in San Francisco. (The American Lawyer via Law.com).

No Deal: The Supreme Court of Georgia determined that a team of lawyers representing a proposed class of people against NBC’s hit game show “Deal or No Deal” didn’t have a case. (Fulton County Daily Report via Law.com).

Threat: The WSJ reports that a new threat to banks is looming: growing bad loan reserves.

Showdown: Finally, the Pennsylvania Democratic primary has arrived. Here’s what The Philadelphia Inquirer has to say about it.

Former DOJ Official Charged in Abramoff Probe

It was a gray day for most of us, but imagine how dismal it must have seemed to Robert Coughlin II.

The former deputy chief of staff in the Justice Department’s Criminal Division was accused today of criminal conflict of interest for his alleged dealings with a member of Jack Abramoff’s lobbying team at Greenberg Traurig. The Associated Press has more here.

You probably remember Coughlin’s name from news reports last year. Or maybe you don’t — it’s pretty hard to keep all the Abramoff-related cases straight, without benefit of an accordion file and some multi-colored tabs.

Anyway, investigators said at the time that they were interested in Coughlin’s relationship with lobbyist Kevin Ring from 2001 to 2003, when Coughlin was in the Justice Department's Office of Legislative Affairs. Coughlin resigned from the Criminal Division last April, citing personal reasons. Ring is still under investigation.

The criminal information (read: upcoming plea deal) filed today in U.S. District Court for the District of Columbia alleges that “Coughlin provided assistance to a lobbyist and the lobbyist’s law/lobbying firm on particular matters before DOJ while knowingly receiving a stream of things of value from the lobbyist and his firm because of such assistance, and while having discussions concerning prospective employment with the law/lobbying firm.”

While the court papers don't mention Ring's name, it was previously reported that Coughlin had approached him about getting a job at Greenberg Traurig, and that Ring comped Coughlin meals and tickets to events. Interestingly, Ring used to work for Rep. John Doolittle (R-Calif.). Doolittle, who is retiring from Congress at the end of this year, is also under investigation.

Coughlin's plea hearing is tomorrow.

Closing Arguments in SEC vs. Former AOL Exec Part II

One of three defense attorneys who are delivering closing statements in the SEC case against former executives at AOL and PurchasePro.com managed to get his turn this afternoon.

Terrence Reed, a name partner at Lankford, Coffield & Reed — which is representing former PurchasePro official Christopher Benyo — criticized the SEC arguments that his client aided and abetted a sham $3.7 million transaction in 2001 to boost revenues at his old company.

Reed said government attorneys were trying to paint his client and co-defendants as "securities fraud violators." He called that "a reputation-destroying label that will follow Mr. Benyo and these other gentlemen for the rest of their lives."

Former America Online Inc. attorney Kent Wakeford is represented by Dewey & Leboeuf's Henry Asbill, Kerri Ruttenberg and Paul Hugel. Former PurchasePro executive Michael Kennedy is represented by David Schertler and Daniel Onorato of Schertler & Onorato.

Closing arguments will resume at 9:30 a.m. tomorrow and jurors will most likely begin deliberating in the afternoon, said Senior Judge Gladys Kessler of the U.S. District Court for the District of Columbia.

Justice Thomas, Husker Helper

More than 80,000 fans turned out for the Nebraska Huskers spring football game on Saturday, and Supreme Court Justice Clarence Thomas, one of the team's biggest fans, was leading the charge — literally. Thomas was a "guest coach" and got to run out on the field at the head of the team (photo courtesy of the University of Nebraska) and stayed on the sidelines during the scrimmage.

Thomas, you may recall, is not a Nebraska grad himself, but his wife Ginni is, and he has become an avid supporter of all Huskers athletes — once telling team members he bleeds Husker red. Last fall, in connection with the publication of his memoir, ABC's Jan Crawford Greenburg accompanied him to a game, and it was clear from her report that Thomas had something close to a mentoring relationship with some of the team members. He spoke with team members on Saturday as well, we are told.

The Recusal Remedy

With state judicial elections getting more costly and raucous, many organizations are voicing concern about how to preserve — or restore — the independence and integrity of state court systems. When judicial candidates accept campaign donations or make campaign pronouncements that might affect their impartiality in future cases, what can be done?

The Brennan Center for Justice has issued an important report that points to an answer that has not gotten enough attention: beefing up recusal standards, which now are notoriously weak. The report, titled "Fair Courts: Setting Recusal Standards," urges making it easier for parties, through recusal motions, to ensure that their cases are not heard by judges who might be beholden or biased toward one side or the other. The report also suggests automatic disqualification of judges from cases involving large campaign donors, and recommends ways of making the recusal process more transparent and subject to review.

"No judicial system should accept a process which leaves a litigant acting in good faith saddled with a judge whose fairness can be reasonably questioned," writes Baker Botts partner Thomas Phillips, formerly the chief justice of the Supreme Court of Texas, in a foreword to the report. So long as states are unwilling to make major changes in the way their judges are chosen, Phillips says, "improved recusal procedures are among the most promising incremental reforms."

Speaking of recusals, we've just updated "Recusal Report," our Web site that looks at recent recusal announcements by Supreme Court justices. And, given that the justices almost never reveal their reasons for recusing, the page offers possible explanations based on available information about justices' financial and family connections.

Closing Arguments in Trial Against Former AOL Executives

Closing arguments got underway today in the government’s case against two former executives at America Online Inc. and one former executive of PurchasePro.com, who were accused of cooking the books. The defendants — former AOL executive Kent Wakeford and former PurchasePro officials Christopher Benyo and Michael Kennedy — are accused of taking part in a scheme to deceive investors and accountants by inflating the revenues of Las Vegas software company PurchasePro. (See Legal Times' earlier story on the case here.)

David Gottesman, a trial attorney in the Securities and Exchange Commission’s commercial litigation branch, told jurors, “The whole scheme was a fraud. All three defendants were in fraud up to their necks. They couldn’t get enough revenue, so PurchasePro, with the help of the defendants, cooked the books.” The SEC charges the defendants with aiding and abetting a securities fraud related to a $3.7 million transaction.

The six-week trial has been heard in front of Senior Judge Gladys Kessler of the U.S. District Court for the District of Columbia.

All three defendants were acquitted last year by a jury in the U.S. District Court for the Eastern District of Virginia of criminal charges related to the scheme.

If jurors side with the government in this most recent case, the defendants face penalties and fines and the possibility of being permanently barred from holding office in a publicly held company.

A fourth defendant, former AOL executive John Tuli, is being tried separately, and his trial is set for July.

Closing arguments by the defendants’ attorneys will take place this afternoon and tomorrow. Legal Times will continue its coverage of the trial.

— Reported by Pedro Ruz Gutierrez