The BLT: The Blog of Legal Times

Board Recommends Disbarment for Lawyer For Fraud Conviction

An attorney discipline board in Washington is recommending Daryl Hudson III, the head of a debt financing company in Washington and former counsel with the U.S. Securities and Exchange Commission, be disbarred over his wire fraud conviction.

The Board on Professional Responsibility earlier this month recommended disbarment. Hudson was convicted of a crime of "moral turpitude," the board said, warranting automatic disbarment—if the conviction survives appeal.

A federal jury in New Mexico found Hudson guilty of wire fraud in September 2012. Hudson is serving a 70-month sentence in prison. The District of Columbia Court of Appeals is not expected to rule on Hudson's status with the D.C. Bar until his appeal wraps up.

This Week in The National Law Journal

Clerks Hiring Plan 'Kaput': Federal courts are abandoning an effort to control the clerk hiring process, Karen Sloan reports.

Regulatory Climate is Unsettled: Todd Ruger reports on The National Law Journal Regulatory Summit last week.

New Plan in Mesh Litigation: Amanda Bronstad reports: "With the parties no closer to settlement, the federal judge overseeing the transvaginal mesh device litigation is weighing an entirely new trial plan in hopes of resolving the nation's largest mass tort."

Gilbert Sues Ex-Client for $6 Million in Fees and Expenses

Washington-based law firm Gilbert is suing a former client for more than $6 million in legal fees and expenses in connection with a $26 million jury award.

Gilbert's former client was Tire Engineering & Distribution LLC. The company, which does business as Alpha Tyre Systems and Alpha Mining Systems, develops special tires for underground mining. After Alpha won a $26 million judgment in a trade secrets case, Gilbert claimed the company refused to pay millions of dollars after switching lawyers—to former Gilbert partners who started their own practice.

The firm sued Alpha and its new lawyers at Weisbrod Matteis & Copley on Nov. 13 in District of Columbia Superior Court.

Federal Employees Sue for Damages Over Shutdown

A group of federal employees who worked without pay during the partial government shutdown last month are suing over alleged damages, claiming violations of federal labor law.

The lawsuit accuses the government of violating the Fair Labor Standards Act by not paying employees who worked during the shutdown on their normal pay schedule. Even if they were paid later on, the plaintiffs allege, the government still owes them additional damages under federal law.

The federal workers filed suit Oct. 24 in the U.S. Court of Federal Claims. On Nov. 1, Judge Susan Braden put the case on hold, asking the U.S. Department of Justice to provide information on proposed legislation in Congress dealing with back-pay for federal workers. The case was reassigned to Judge Patricia Campbell-Smith.

D.C. Circuit: Contraceptive Mandate Violates Religious Freedom

Requiring employer insurance plans to include contraception coverage "trammels" the constitutional right to freedom of religious expression, a divided U.S. Court of Appeals for the D.C. Circuit said today.

The D.C. Circuit is the latest court to join the legal fray over the contraceptive mandate included in the Obama administration's health care reform law. Federal appellate courts have split on whether the mandate violates the religious freedom of those who oppose contraceptive services and abortion, setting the stage for a fight before the U.S. Supreme Court.

In today's ruling, the court reversed a trial judge's decision denying an injunction that would block, at least temporarily, the contraception mandate. The trial judge was ordered to take another look at the plaintiffs' request for an injunction.

In Suit, Patton Boggs Seeks $200,000 in Legal Fees

Patton Boggs is suing a former client in Virginia state court to recoup more than $200,000 in legal fees.

The complaint, filed Oct. 28 in Accomack County Circuit Court, accuses BaySys International LLC of failing to pay $228,919 for legal services provided during a 14-month period starting April 2011.

BaySys specialized in the production of luxury airplane interiors. Steve Walton, former founder and CEO of BaySys, told Legal Times via telephone that the company ceased operations in June. He did not respond to an additional request for comment. Court records do not indicate whether BaySys has hired counsel to defend against the suit. No hearing dates are set.

The Morning Wrap

Almost Settled: JPMorgan Chase & Co. has tentatively agreed to pay $13 billion to settle claims related to the bank's questionable mortgage practices in the lead up to the financial crisis, The Wall Street Journal reports.

Arrested: A senior agent for the Naval Criminal Investigative Service and a Navy commander were among those arrested in a bribery scandal involving an Asian defense contractor that provided prostitutes and other kickbacks, The Washington Post reports.

Captured: The two convicted murderers who had escaped from a Florida prison on forged documents were captured Saturday, CNN reports.

D.C. Divorce Lawyer Disbarred

Glenn Lewis, a one-time prominent member of the Washington-area divorce bar, was disbarred yesterday. The order comes several months after the Virginia State Bar stripped him of his law license.

The Virginia disciplinary board found Lewis took fees from clients without doing work he was hired for, mishandled client funds and failed to keep required financial records, among other charges. The Virginia State Bar revoked his license in May.

On October 17, the District of Columbia Court of Appeals disbarred Lewis, citing the Virginia decision. According to yesterday's order, Lewis did not respond to a previous court order asking him why it shouldn't disbar him.

Justice Department Lawyers Return to Work

U.S. Department of Justice lawyers across the country will be back in court after an untold number of civil cases were put on hold during the government shutdown.

More than 18,000 Justice Department employees, including a significant number of lawyers who handle civil matters, were furloughed during the shutdown. In a letter this morning to the entire department, Attorney General Eric Holder Jr. said he was "grateful to be able to welcome the entire Department of Justice back to work!"

"All of you are essential to protecting the American people and to performing our critical law enforcement functions," Holder wrote. "Our collective work is absolutely crucial, and I don't want another day missed."

Federal Courts Reducing Space to Save Money

Updated at 6:07 p.m.

The federal judiciary will hand over more than 66,300 square feet of underused office space in court buildings across the country, saving $1.7 million in annual rent.

The Administrative Office of the U.S. Courts announced this week that space in 31 federal court offices will be returned to the U.S. General Services Administration, which manages court facilities. The space reduction program is part of a series of cost-saving measures the federal judiciary adopted to cope with budget cuts.

The judiciary is rewarding court offices that found ways to reduce space. Chief judges of the courts that participated will receive a share of more than $1.7 million in one-time incentives. The money can be used for general operating expenses.