The BLT: The Blog of Legal Times

On a Street Named K, A New Way to Start Your Day

Restaurant K by Alison Swope has already established itself as an approachable, affordable high-quality spot for lunch and dinner at 1700 K St. N.W., right near the intersection with Connecticut Avenue. Today, the restaurant opened its doors for breakfast for the first time, extending that reputation into the morning hours.

We sampled the breakfast fare as part of a Legal Times roundtable with law firm managing partners (see a brief report on the discussion here and more detail in a future issue of Legal Times,) but we also snagged a menu and can report that this is a great place to start your day. The star attraction was the Blue Crab Quiche, rich, crabby and not too pricey at $9.75. The chilaquiles with eggs was a messy but delicious tangle of eggs, cheese, onions, tomatillo sauce and tortillas, also a good bet at $8.50. For $6.75 you can have a gooey but not outrageously huge sticky bun with coffee and juice. Very nice. For dieters, there's a good selection of smoothies, fruits and meusli, all in the $5 range.

All in all, not that much more expensive than a trip to a nearby Starbucks or Caribou, and much more civilized. Breakfast at Restaurant K will be served Tuesday through Friday from 7:30 to 9:45 a.m.

2008 Legal Business Forecast Panel

This morning, Legal Times hosted a panel of firm managing partners who shared their 2008 legal business outlooks. Despite the downturn in the economy, the discussion certainly wasn’t all doom and gloom. Though the partners agreed that certain practices will likely feel somewhat of a squeeze this year, they were confident that other areas, such as litigation, will have enough work to sustain their firms.

Maureen Dwyer, managing partner of Pillsbury Winthrop Shaw Pittman’s D.C. office, said there’s a common misconception that firms have to start at zero at the onset of a new year. To the contrary, she said her office has a number of ongoing litigation matters that will continue to benefit the firm in 2008.

Chairman of Howrey, Robert Ruyak, emphasized that firms are having to rethink their strategic goals. The “supermarket firm,” he said, is a thing of the past. To stay profitable these days, Ruyak said firms are better off focusing on customizing themselves to select clients.

The panel also included Richard Murphy, partner in charge of Sutherland Asbill & Brennan’s D.C. office; Michael Nannes, chairman of Dickstein Shapiro; and La Fonte Nesbitt, executive partner of Holland & Knight’s D.C. office. Look for a full transcript of the event in an upcoming issue of Legal Times.

Executive Power Grab, or Fair Game?

You may not have noticed it, but tucked into President George W. Bush's State of the Union speech last night was a reference to an executive order he plans to issue today that sounds like an in-your-face invitation to a separation-of-powers battle with Congress.

Bush complained about congressional "earmarks," especially those that are snuck into committee reports that accompany legislation, rather than in the legislation itself. The president continued, "Tomorrow, I will issue an executive order that directs federal agencies to ignore any future earmark that is not voted on by Congress. If these items are truly worth funding, Congress should debate them in the open and hold a public vote." Our companion Influence blog discussed the anti-earmark effort here yesterday.

Bush's challenge seemed to mirror the controversy in recent years over his signing statements, in which Bush asserted his intention not to enforce certain parts of statutes he was signing. It even carried faint echoes of "impoundment," the presidential practice of outright refusing to spend appropriated funds, which got President Richard Nixon in such trouble with Congress. Does Bush's pronouncement portend a major courtroom clash between the executive and legislative branches? MSNBC's Chris Matthews ventured the guess on the air last night that Bush's move would be "extra-constitutional."

We asked Stanley Brand of Brand Law Group in D.C., one of the top go-to guys in the nation's capital for interbranch disputes such as this one. Brand, who was general counsel to the U.S. House of Representatives under Tip O'Neill from 1976 to 1983, said his initial judgment is that Bush's executive order falls within his powers.

"It could be the one instance of many efforts by President Bush to assert executive prerogatives where he is right," said Brand. "If an appropriation is not in the law, it's not part of the constitutional mandate" for the executive branch to spend it.

Brand explained that it has become common for members of Congress to express their specific preference for how an appropriation should be spent in a committee report, which does not have the same force of law that it would have if it were in the statute itself. Nonetheless, "agencies are subject to the will of their patron appropriators," Brand says, so they often take the committee reports as marching orders.

An executive order from the President will give agencies more backbone to refuse to spend earmarked money the way members wanted them to, says Brand, but in the real world "they will still be on the horns of a dilemma." But for now, Brand says, it does not appear that Bush's executive order will be "a litigable issue."

Congress Looking at State Secrets Privilege

There was a time when it seemed that the administration would have to bare all in court. The warrantless wiretapping program, the secret prisons, the enhanced interrogation techniques and the legal opinions behind them — all have been the subject of civil lawsuits. None has succeeded (yet) in the way the plaintiffs had hoped. The government’s weapon, according to a story deep in today’s Washington Post, has been the state secrets privilege, which allows the government to switch off lawsuits on national security grounds.

The law provides that judges can dismiss a case, even if it appears to have merit, to prevent potentially harmful information from escaping in court. (Click here for our report on the use of the privilege in civil suits against telecom companies believed to have cooperated with the NSA in its surveillance program.) And according to some in Congress, the Bush administration has used state secrets privilege excessively.

The issue was the subject of a hearing in the House Judiciary Committee today. Sen. Edward Kennedy (D-Mass.) has called for congressional oversight of the government’s use of the privilege. On the floor of the Senate last week, Kennedy said the adminstration's reliance on the privilege had “dramatically increased,” since 9/11, though the exact numbers are a matter of some dispute.

Some say the increase is a function of more covert operations since 9/11 and others say the government’s use of the privilege hasn’t increased at all. The Post cites a study by Robert Chesney, an associate professor at Wake Forest University School of Law, showing that the Bush administration has invoked the state secrets privilege 20 times since 2001, while it was invoked 26 times from 1991 to 2000 and 23 times from 1981 to 1990.

“There's this strong desire to show that this is something the Bush administration has seized upon to put things under the rug," Chesney told the Post. "They have seized on it, but they also have been confronted with dozens and dozens of lawsuits seeking to explore classified programs."

Here are two statements — given at the hearing today — from H. Thomas Wells Jr., president-elect of the American Bar Association, and Judith Loether, a Boston native whose father was killed nearly 60 years ago in a B-29 Superfortress crash.

Loether testified that the government refused to turn over the accident report at the time because it contained sensitive information about electronic equipment on the plane. Her mother and two other widows sued for the information, and the case eventually landed in the Supreme Court. The 1953 decision in United States v. Reynolds recognized the executive's right to withhold potentially damaging national security information and established the state secrets privilege.

When the accident report was declassified and released in 2000, Loether discovered that it contained no references to secret technology; rather, it documented a series of malfunctions and pilot errors that the Air Force had sought to conceal from her mother and the others, Loether said.

Morning Wrap

Contractors in Iraq: In an unusual closed hearing, the Fifth Circuit Court of Appeals on Wednesday will debate a 2005 suit pitting former employees against KBR and its ex-parent company, Halliburton, that will weigh whether U.S. courts have jurisdiction over the actions of U.S. civilian contractors abroad, The American Lawyer reports in its February issue. Nine former drivers claim they were fraudulently recruited for hazardous jobs in Iraq with false promises. In September 2006, a federal district court judge in Houston dismissed the suit after partners David Kasanow and Raymond Biagini of McKenna, Long & Aldridge in D.C. convinced the court that the case raises a political question beyond the court's competence.

Not a Puppet: The city's legislative body met last night to discuss the independence of the attorney general's office and whether Mayor Adrian Fenty's general counsel, Peter Nickles, may have interfered in former attorney general Linda Singer's job. The Washington Post quotes council member Mary Cheh as saying Nickles' office appeared to be no more than a puppet of Fenty's. "I don't think anyone's a puppet," Nickles replied. "I'm not a puppet. I believe after 45 years in the legal profession, I'm entitled not to be called a puppet."

Unequal Footing: A government effort to set aside quotas for women-owned businesses in certain fields will hit a snag, legal scholars say, because of proposed rules by the Small Business Administration, the Charlotte Business Journal reports. Under a new proposal, each federal agency would have to find evidence that it had discriminated against women-owned businesses before setting aside contracts. Critics say the rules are not practical and will lead to no contracts and a potential chilling effect in state and local contracting.

Lies & Lawsuits: Seymour Lazar, a retired attorney who posed as a plaintiff for $2.6 million in a kickback scheme involving class-action suits by the firm now known as Milberg Weiss, was sentenced Monday to six months of home detention and two years probation, The Associated Press and Los Angeles Times report. Lazar, 80, becomes the first of seven people, including three former partners, who have pleaded guilty in the case to be sentenced. U.S. District Judge John Walter of Los Angeles said he was outraged that an attorney could "flatly lie" in proceedings. Walter, however, spared Lazar jail time because of his declinging health and age. Prosecutors say the case involves some $11 million in kickbacks paid by the firm to plaintiffs in class action suits against large corporations that netted an estimated $250 million in two decades.

AG Michael Mukasey Gives Glimpse of Testimony

With less than two days before his scheduled appearance before the Senate Judiciary Committee, Attorney General Michael Mukasey today released a pretty upbeat overview of the Justice Department.

However, Mukasey avoids all mention of waterboarding or interrogation in a 24-page statement.

Instead, he praises various programs and also pleads with senators to pass a revised Foreign Intelligence Surveillance Act bill that accommodates the White House's wishes and perspective. He devotes four pages to FISA reform.

"Of course, we will not always agree," Mukasey writes ahead of Wednesday's oversight hearing. "There are policy initiatives that the department supports that some members of this committee vigorously oppose, and vice-versa."

Mukasey's avoidance of sensitive topics was not lost on Senate Judiciary Chairman Patrick Leahy (D-Vt.) who released the following statement:

"Attorney General Mukasey’s prepared testimony did not address issues members of the Committee have asked him about in advance of the hearing, such as whether he agrees that waterboarding is torture and illegal, and about the status of the Department’s investigation into the CIA’s destruction of detainee interrogation tapes," Leahy said. "I look forward to questioning the Attorney General about these and other matters, including his plans to address rising crime, public corruption and the politicization of the Department of Justice. We must have a candid and responsive dialogue with the Attorney General as we work to rebuild the Department of Justice.”

Senate Revisits FISA Reform

Update:

Late today, and after two hours of discussion, Democrats beat back an effort by Republicans, who mustered only 48 of 60 votes needed to end the debate and force a floor vote on a pending FISA bill.

However, Democrats also failed by an identical margin in their bid to extend a temporary FISA law 30 days beyond Friday, when it sunsets. It's unknown what the next steps for the bill are or whether the Protect America Act will lapse without an alternative.

The Senate will resume debate on reforms to the Foreign Intelligence Surveillance Act in a few minutes (3 p.m.) as a temporary law passed in August is set to expire on Friday.

Last week, the Senate killed a bill that did not shield telephone companies from lawsuits involving the government's warrantless surveillance program. That's a major point of contention among Democrats, who are divided over competing measures to revamp FISA.

On Thursday, the Senate rejected a proposal by the Senate Judiciary Committee to expand the FISA court's oversight.

So far, the Senate's Intelligence Committee version is the only one standing while several amendments have been rebuffed. Sponsored by committee Chairman John Rockefeller of West Virginia, that bill is favored by the White House because it grants the telephone companies the retroactive legal immunity they are seeking for their past cooperation on the NSA program.

A vote on cloture could come as early as today to end the debate and move the proposal closer to a full vote. If passed, the bill would have to be reconciled in conference with the House, which passed its version last fall.

House Intelligence Committee Chairman Silvestre Reyes (D-Texas) and House Judiciary Rep. John Conyers (D-Mich.) last Thursday called for a 30-day extension of the current law to allow for more debate. That plea came after the White House last week allowed House staff to view records related to the warrantless program after eight months of resistance to such disclosure.

To catch the Senate's live action, watch the feed at C-SPAN2.

Email of the Day

Earlier today, in response to the article “The Big Pay Squeeze,” we received an email from Eric Bernthal, managing partner of Latham & Watkins, who provided a little more insight into the world of compressed salaries. If any other managing partners would like to offer up similar tales, please feel free.

Here’s the email:

“I read your article this morning with interest, Nate. I particularly like you featuring my old friend, Mr. [Marc] Fleischaker, who says that the associate-partner pay compression ‘doesn't bother us’ at Arent Fox. But he didn't tell you the real reason why: it happened to him as a new partner — at Arent Fox — back in the 1970s.

“Marc and I started together as young associates at Arent Fox. (The years are fuzzy, but I think he joined in 1971. I arrived in 1972. I made partner in 1977, and he made it in 1978. I'd like to get you to believe that I was just smarter and more precocious, but the truth is that I clerked for two years after law school, so we both were just promoted with our respective law school classes.) If memory serves, we made about $45,000 each as senior associates back then. In contrast, first-year partners made about $40,000. We fretted about all the same things that are covered in your article, some 30 years later, such as paying for our health insurance and buying our equity, and still making less money as partners. Somehow, we survived then, much as young Arent Fox partners will survive and prosper today.

“Marc went on to have an illustrious career at Arent Fox, and he has probably now run the place for as long as Earl Kintner did, when Marc was just a kid. But his real claim to fame has nothing to do with Arent Fox: rather, it is that he played high school basketball in Louisville, Kentucky, with the legendary Wes Unseld. (I can also assure you, however, that, even in those horrific, dry years of 1978-2000, when the Bullets couldn't beat a good high school team, there was never any thought of reuniting Marc with Wes to improve the team's chances.)

“Anyway, our experience proves that if pay compression is anything at all, it's not a new phenomenon.”

Latham Announces Associate Bonuses

Associates at Latham & Watkins are happy campers this bonus season. According to Eric Bernthal, the managing partner of Latham’s D.C. office, the firm is paying an average 2007 bonus of more than $51,000, and top-notch associates got as much as $133,500.

Total compensation for some senior-level associates neared $400,000, except in New York where compensation was even higher.

See this Legal Times piece for more on District’s 2007 bonuses.

DOJ Personnel to Monitor Florida Primary

Nearly eight years after the world was introduced to “hanging chads” in the famous manual recount of the contested 2000 presidential election in Florida, the Department of Justice is sending employees to the Sunshine State for Tuesday's presidential primary.

The department today announced Broward County — the state's second-largest with an estimated population of 1.8 million — will be monitored to "ensure compliance with the Voting Rights Act."

"Broward County has an obligation under Section 203 of the Voting Rights Act to provide all election information, ballots and voting assistance information in Spanish as well as in English," a department statement said. "The monitors will gather information concerning compliance."

In 2004, the Justice Department deployed a record 1,463 federal observers and 533 department personnel to monitor 163 elections in 106 jurisdictions in 29 states. By comparison, only 640 observers and 110 department employees took part in 2000 elections.