The BLT: The Blog of Legal Times

The Morning Wrap

Plugging the Leak: BP reported some progress on Friday in its struggle to shut off its gushing deepwater Gulf of Mexico oil well, and President Barack Obama was set to assert control with a visit to coastal areas threatened by the largest oil spill in U.S. history, Reuters reports.

Nein Danke: Top U.S. and German officials acknowledged differences over key financial regulation issues, and they said a "broad agreement" on basic concepts may not produce uniform rules in all the world's capital markets, according to the Washington Post.

Insider Trading: Fried, Frank, Harris, Shriver & Jacobson and Wachtell, Lipton, Rosen & Katz played key roles brokering a $28 million settlement that resolves a long-simmering allegation that Pequot Capital Management, the Westport-based hedge fund, committed insider trading in Microsoft securities in 2001, according to SEC officials, The AmLaw Daily reports.

Do Tell: The House voted to let the Defense Department repeal the ban on gay and bisexual people from serving openly in the military, a major step toward dismantling the 1993 law widely known as “don’t ask, don’t tell,” The New York Times reports.

New Deal: Prudential Plc, the U.K. insurer seeking to buy American International Group Inc.’s Asian unit in a $35.5 billion acquisition, said it’s talking with AIG about changing the terms of the deal, according to Bloomberg.

Solicitor General Revises Data on Federal Juvenile Sentences

In an unusual filing with the Supreme Court this week, Acting Solicitor General Neal Katyal said some of the information that the Court used in its recent Graham v. Florida decision, supplied to the Court by a federal official without the SG's knowledge, was inaccurate. The letter casts a new light on the federal government's non-involvement in the case, which has been the subject of some controversy.

In the landmark decision May 17, the high court ruled that the Eighth Amendment bars the sentencing of juveniles to life in prison without the possibility of parole for non-homicide crimes.

The May 24 letter to Court Clerk William Suter, obtained by the Blog of Legal Times, clarifies the information that led Justice Anthony Kennedy to write in his majority opinion that "there are six convicts in the federal prison system serving life without parole sentences for [juvenile] non-homicide crimes." In the ruling, Kennedy had indicated that because Florida did not provide data about the number of juveniles sentenced to life without parole in the state and federal systems, the Court set out on its own to find out accurate information. Kennedy cited letters sent by officials in Nevada, Utah, Virginia, and the federal Bureau of Prisons to the Court library filling the information gap.

Katyal's letter focused on the information submitted by Bureau of Prisons in its letter, "of which this office became aware only upon the release of the Court's decision," and which was "submitted in response to a confidential request from Court personnel."

Katyal said that because of "time constraints," the number of six federal prisoners was arrived at by consulting "automated inmate records," rather than presentence reports and other documents. Since the decision came down, Katyal said a "careful review" of presentence reports was conducted, leading to the conclusion that "it appears that none of the six inmates listed ... is serving a life sentence  based solely on a nonhomicide crime completed before the age of 18." Katyal explained that all of the inmates cited by the Bureau of Prisons were convicted for criminal conduct that continued after they reached 18, or involved killing someone.

Apart from the unusual nature of the Court's own data-gathering project, the letter is also noteworthy as it may relate to Solicitor General Elena Kagan's nomination to the Supreme Court. Ordinarily in state cases like Graham v. Florida, the federal  government weighs in, if the outcome could affect federal law or policy. The government stayed out of the Florida case, however, in spite of the fact that federal law does permit sentencing of juveniles as young as 13 to life without parole, as the Court noted. If six actual federal inmates were affected by the Florida case, it might have made the SG's decision to stay out of the case more notable.

In fact, Kent Scheidegger of the conservative Criminal Justice Legal Foundation took Kagan to task for staying on the sidelines in the case. "This is a curious incident," Scheidegger wrote on the day the decision came out, citing the six federal inmates affected by the case. "The senators need to ask why she was AWOL on LWOP." LWOP is an acronym for life without parole.

Asked about the Katyal letter this afternoon, Scheidegger said some of the federal inmates might still be able to benefit from the Graham decision, and the federal law still is on the books. "So, even with this letter, there does appear to be some impact on federal sentences and on the constitutionality of an act of Congress as applied in those cases," Scheidegger said. "That would normally be enough for the SG to come in. Maybe she had a good reason, but an explanation is in order." 

UPDATE: Scheidegger has posted the text of the Katyal letter (pdf) at his Crime and Consequences blog site here.

FOIA Suit Seeks NASA’s Global Warming Data

NASA has been slapped with a Freedom of Information Act lawsuit alleging that the agency has tried to cover up mistakes in data that have been widely used to support claims of global warming.

In an 18-page complaint filed this morning in the U.S. District Court for the District of Columbia, the Competitive Enterprise Institute says that, in 2007 and 2008, it submitted, but not yet received adequate responses to, FOIA requests seeking NASA documents and information related to changes made to NASA’s temperature data in response to questions raised by Steven McIntyre. McIntyre runs Climate Audit, a blog devoted to the analysis and discussion of climate data.

The complaint says McIntyre discovered errors in NASA’s data that resulted in an overstatement of the amount that temperatures have risen in the United States since 2000. Those erroneous data, the complaint says, have been used by NASA’s Goddard Institute of Space Studies to make claims in the media that temperatures in the United States have risen dramatically during the past 10 years. Among those claims was that 1998 was the “hottest” year on record.

CEI, which is being represented by Gibson, Dunn & Crutcher partner Andrew Tulumello pro bono, alleges in the complaint that, once the errors were pointed out in August 2007, NASA made a series of changes to the data and then “sought to reverse-engineer the temperature data so that 1998 could again be deemed the warmest year on record.”

On Aug. 24, 2007, CEI filed its first FOIA request with NASA, seeking information about the changes. Three days later, CEI filed a second FOIA request, this time asking for all documents generated in response to the first FOIA request.

The complaint alleges that a year passed before NASA responded to the FOIA requests, and that when it did respond it was to say that “the requested information has been forwarded to the Office of the Chief Counsel for review.” Two and a half years passed before CEI received a partial response to its FOIA requests. According to the complaint, the documents that were turned over were “heavily redacted.”

On Jan. 28, 2008, CEI filed a third FOIA request seeking records related to work done by NASA scientists on a Web site called RealClimate.org. According to the complaint, NASA scientists, including climate researcher Gavin Schmidt, had been writing posts on the site during the work day that were, in effect, “public relations and advocacy” for NASA. The complaint alleges that after the FOIA request pointed out that some posts were being put up during the work day, all timestamps on the posts were removed from the site and its archives.

NASA’s delays in responding to the FOIA requests prompted Sen. David Vitter (R-La.) and Sen. Jim Inhofe (R-Okla.) to call for an investigation by the agency’s inspector general on Dec. 3, 2009. The inspector general’s investigation determined that the delays were caused by “inadequate direction given...as to what documents were requested and a due date for a response”; “inadequate communication”; and “inadequate staffing at the Goddard FOIA office.”

The complaint requests a court order that directs NASA to comply with the three FOIA requests and to cover CEI’s legal fees.

Tulumello said he got involved in the case when he saw press reports about the FOIA delays. He said he called CEI and offered to represent the group in a FOIA lawsuit.

“This is an incredibly important issue for the country. There is cap and trade legislation in Congress right now, and the public has a right to know whether the government’s data on climate change is accurate and can be trusted,” said Tulumello. “All we’re looking for in this case is for a government agency to comply with the requests for information that were filed almost three years ago.”

Judge Denies Discovery in Fee Dispute Over D.C. Handgun Case

The District of Columbia's time and billing records for work spent defending the handgun ban up to the Supreme Court will remain a secret—at least for now.

Judge Emmet Sullivan of the U.S. District Court for the District of Columbia today ruled for the city in granting a protective order. The protective order blocks a request for information filed by plaintiffs’ attorney Alan Gura of Gura & Possessky in Alexandria, Va. Gura, who persuaded the Supreme Court to overturn the handgun ban in 2008, is asking for more than $3.5 million in fees.

Gura sought a variety of records from the city—including time sheets, billing statements and invoices documenting the time the District and its attorneys spent in the litigation. He said in court papers that the city’s time and expenses—given the counsel the District received from the private practitioners—is relevant to his fee petition.

Sullivan, however, concluded that a comparison of the District’s time records and fees would not assist him in resolving the plaintiff’s fee petition. “While the Court does not foreclose the possibility of a plaintiff ever obtaining discovery from a defendant as to a fee petition, the Court finds such discovery unnecessary in this case,” Sullivan wrote in an order today.

In his order, Sullivan pulled a line from the Supreme Court's ruling in 1983 in Hensley v. Eckerhart, where the court said a request for fees should not result in a second major litigation.

The judge denied Gura’s request without prejudice, saying that the District’s records could become relevant in the coming months as the fee litigation proceeds. Gura was instructed yesterday to file a revised fee petition by no later than June 18. Sullivan asked the lawyers to address the impact of a recent Supreme Court decision on fee enhancements.

BP Official Resists Defining 'Legitimate' Claim

A top BP PLC executive declined to be specific today when pressed at a congressional hearing to say what kind of claims the company will pay from the Deepwater Horizon oil spill.

The House Judiciary Committee is holding a hearing on the liability questions surrounding the Gulf of Mexico spill, including the response of the companies involved and the damage limits written into federal law. Darryl Willis, BP’s vice president for resources, is representing the company at the hearing.

“We are going to pay all legitimate claims,” Willis said, repeating a company refrain that has drawn skepticism from lawmakers and from plaintiffs’ advocates, who have brought scores of class actions and other lawsuits against BP and other companies.

Rep. Jerry Nadler (D-N.Y.) pressed Willis repeatedly to define “legitimate.” He asked, for example, whether BP would compensate people who, hypothetically, might be injured by the chemical dispersant BP is using to reduce the impact of the oil spill.

“Is that a valid claim?” Nadler asked.

“They can file a claim, yes,” Willis said.

“I didn’t ask if they can file a claim,” Nadler shot back. “Is that a claim that you will pay?”

“Every claim will be evaluated,” Willis said.

“Can you answer yes or no, please?” Nadler asked.

"Pants Judge" Pearson Loses Appeal in D.C. Circuit

Former administrative law judge Roy Pearson Jr. just can't catch a break in his quest to hold someone accountable for losing his job with the District of Columbia.

Pearson, recall, was the judge who filed a multimillion-dollar suit against a dry cleaner over a lost pair of pants. The suit didn't go unnoticed. In 2007, Pearson was denied reappointment to his post as a D.C. administrative law judge. Pearson sued, making a host of claims.

When Pearson’s wrongful termination suit was dismissed by the federal district court in Washington, he turned to the U.S. Court of Appeals for the D.C. Circuit. Today, a three-judge panel upheld the dismissal of the suit.

At issue in the suit was Pearson’s contention that he was denied reappointment because of his complaints about the peer review system in place at the D.C. Office of Administrative Hearings. Pearson, a member of the D.C. Bar since 1978, had complained to the D.C. Council that his independence as a judge was “chilled and frustrated” by a secret peer review system.

“The district court correctly concluded Pearson’s testimony before the D.C. Council and private communication with the Council’s staff were not protected by the First Amendment to the Constitution of the United States,” D.C. Circuit Judges Douglas Ginsburg, Karen LeCraft Henderson and Merrick Garland said in a two-page judgment today.

The judges pointed to a D.C. Circuit ruling last year in an unrelated case where the court said that a public employee speaks without First Amendment protection when he reports conduct that interferes with his job responsibilities. “Pearson did just that,” the panel judges said today.

Pearson’s suit against his dry cleaner was also not protected speech, the appeals court said. “That suit did not involve a matter of public concern; as the district court stated, it was more properly ‘characterized as a personal vendetta against a dry cleaners over a pair of pants.’”

The D.C. Circuit rejected flat-out Pearson’s claim in briefs that U.S. District Judge Ellen Segal Huvelle, the trial judge who dismissed the federal suit, should have been recused because of her association with several of the defendants, who include D.C. Superior Court judges who had varying degrees of involvement in the decision to deny Pearson reappointment.

The appeals court said a person who is fully apprised of the circumstances “could not reasonably question that judge’s impartiality.”

This is what Huvelle had to say about Pearson’s pants suit when she dismissed it: “A review of the nature of, and motivation behind, plaintiff’s lawsuit demonstrates that plaintiff was not on a mission to protect the public welfare.”

Pearson didn’t get a chance to argue his side in court. The D.C. Circuit abruptly cancelled oral argument, ruling on the briefs alone. Pearson, who brought the case pro se, was not immediately reached for comment this afternoon.

Holder Memo Calls for Flexibility in Charging, Sentencing

Updated 1:15 p.m.

Attorney General Eric Holder Jr. this month issued new guidance to federal prosecutors in a memo that one U.S. attorney said today provides greater flexibility, and calls for more collaboration, in making charging decisions in criminal cases.

The Holder memo, which was submitted yesterday to the U.S. Sentencing Commission for its hearing today in Washington, says the “reasoned exercise of prosecutorial discretion is essential to the fair, effective, even-handed administration of the federal criminal laws.”

The May 19 guidance, which replaces previous memos from then-Attorney General John Ashcroft and then-Deputy Attorney General James Comey, says all charging decisions must be reviewed by a supervisory attorney. All but the most routine indictments should be accompanied by a document that sets out charging options and explains the charging decision. People who commit similar crimes and have similar culpability should be treated similarly.

“Unwarranted disparities may result from disregard for this fundamental principle,” the memo says. “They can also result, however, from a failure to analyze carefully and distinguish the specific facts and circumstances of each particular case.”

U.S. Attorney Sally Quillian Yates of Atlanta, who spoke today at the sentencing commission hearing, said the Holder memo recognizes that the federal sentencing guidelines were made advisory by the Supreme Court in 2005. Yates said Justice Department prosecutors had been “the only ones in the courtroom who were still acting like the guidelines were mandatory.”

That harmed the department’s ability to influence sentencing decisions. Prosecutors, Yates said, “ended up out of the conversation” because they would argue, somewhat robotically, that the government is recommending a guideline sentence. The conversation would then proceed between the judge and the defense attorney. “We need to be part of that conversation,” Yates said.

More after the jump.

Transocean: Underwriters Pushed to Limit Liability

Two weeks ago, Transocean Ltd., the company that owns the sunken Deepwater Horizon oil rig, filed a motion in federal court seeking to limit its courtroom losses to $26.7 million. Today, a Transocean lawyer said that underwriters forced the company's hand.

Rachel Clingman, a partner at Sutherland Asbill & Brennan, outlined the company’s position in written testimony submitted to the House Judiciary Committee. She has temporarily gone in-house for Transocean — taking on the title “acting co-general counsel” — and is scheduled to testify in person later this morning.

Clingman said in the written testimony that Transocean has third-party liability insurance applicable to claims arising from the Deepwater Horizon’s explosion.

“Our underwriters instructed us to file such an action, and failure to do so could have resulted in the loss of insurance coverage to help pay claims,” she said of the court motion.

Clingman said the proposed $26.7 million limit would not apply to claims filed under the Oil Pollution Act, a 1990 federal law that outlines a process for compensation after oil spills. But, she added, the company doesn’t expect to pay much in damages under the act, because it has accepted responsibility only for contamination coming from the rig itself, while BP is responsible for oil and gas coming from the underwater well. There has been “no indication thus far of any contamination from the rig,” Clingman said.

The U.S. Department of Justice opposes Transocean’s motion, Associate Attorney General Thomas Perrelli said this week.

Clingman, who heads up Sutherland’s Houston office, also added some insight into the company’s hiring of the law firm to handle litigation from the oil spill. “Transocean has only a small number of U.S. lawyers,” she said. “Given the investigations, inquiries and litigation that ensued in the aftermath of the Deepwater Horizon accident, I was asked to manage Transocean’s response.”

Skadden, Arps, Slate, Meagher & Flom is also advising Transocean on the various congressional investigations.

The Morning Wrap

No Drilling: President Obama will announce a six-month ban on drilling new deepwater oil wells, the Washington Post reports.

Lawyering Up: Transocean has turned to Sutherland Asbill & Brennan to handle litigation stemming from the oil spill in the Gulf, The National Law Journal reports.

No Surrender: Google has balked at requests from regulators in Germany and Hong Kong to surrender fragments of Internet data and e-mails it had improperly collected from unsecured home wireless networks, saying it needed time to resolve legal issues, according to The New York Times.

Lehman's Lawsuit: Lehman Brothers Holdings Inc.'s estate sued J.P. Morgan Chase & Co., alleging J.P. Morgan illegally siphoned billions of dollars from Lehman in the days before the troubled investment bank filed for the largest bankruptcy in U.S. history, The Wall Street Journal reports.

Privacy Please: Facebook is beefing up privacy protections on the world's most popular online social network, addressing mounting pressure to better secure personal data exchanged among its nearly 500 million members, according to Reuters.

Lawyers in D.C. Handgun Case Decline Further Mediation Over Fees

The lawyers who fought out the landmark Supreme Court case over D.C.'s handgun ban today declined any further mediation to resolve a dispute over the attorney fees demanded by the prevailing plaintiffs' attorneys.

Ever since the 2008 win in the high court, the plaintiffs' attorneys, including Alan Gura of Alexandria, Va.'s Gura & Possessky, have been fighting in Washington federal district court for attorneys fees, which the plaintiffs estimate at more than $3.5 million. The dispute was first referred to mediation in November 2008, according to court records.

The topic of mediation came up today at a status conference before Judge Emmet Sullivan of the U.S. District Court for the District of Columbia. Sullivan inquired whether he could “twist” the arms of the lawyers to return to mediation.

“Your honor, I would love to settle this,” Gura said. “But we need a partner to negotiate.” A lawyer for the District, Andrew Saindon of the D.C. Office of the Attorney General, did not respond in court to Gura’s remark. Gura also said the District has made a political decision not to pay him fees—a contention that lawyers for the city said is meritless.

Lawyers for the city filed for a protective order last month to prohibit Gura from seeking discovery on the District’s expenses in defending the handgun ban. Saindon said in court papers earlier this month that the city’s outside counsel—including attorneys from Akin Gump Strauss Hauer & Feld, Covington & Burling and O’Melveny & Myers—served pro bono. Moreover, he said, the private attorneys’ contracts with the District did not require them to provide billing records.

In a May 21 court filing, Gura responded that the city was raising the pro bono service for the first time. “These attorneys’ billing rates and records are relevant to the determination of the value of the legal work performed, whether that value was donated, borrowed, or paid for,” he said. The District, he said, has "a right to demand of its attorneys information about the value of their time, as well as records of what those attorneys are doing on its behalf.”

Sullivan today did not rule on the District’s request for a protective order. He asked the lawyers to file additional pleadings regarding the impact of the U.S. Supreme Court decision in April in Perdue v. Kenny A. In that case, the Court rejected a $4.5 million fee enhancement, but also said judges in rare and well-documented circumstances may award fee enhancements above the “lodestar” amount to lawyers in civil rights disputes.