Facebook’s Zuckerberg to Sell 41.35 Million Shares in Offering
Davis Polk, Baker Botts, Seyfarth, Dewey: Business of Law
Two days after U.S. lawmakers negotiated all night to finish rules that would reshape the business of Wall Street, Annette Nazareth weighed in. That Sunday morning, she e-mailed a dozen Securities and Exchange Commission officials about the bill that would become the 2,300- page Dodd-Frank Act, Bloomberg News’s Robert Schmidt and Jesse Hamilton report.
Nazareth, herself a former SEC commissioner, represents the biggest banks and securities firms as a partner in the Washington office of Davis Polk & Wardwell LLP. She attached an annotated copy of the measure to her June 27, 2010, e-mail, marking changes made during the wee hours. It could be an invaluable tool for an agency hard-pressed to analyze the bill on a tight deadline.
“In case you would find it helpful,” Nazareth wrote to the group, many of them ex-colleagues.
Two hours later, SEC Chairman Mary Schapiro responded: “Thanks. We have our work cut out for us.”
Dodd-Frank, which took effect in July 2010, would shape the SEC’s agenda for the next two years as it labored to write some 100 regulations the law required. It also opened opportunities for Nazareth. With her connections and longtime SEC experience, she emerged as the preeminent legal advocate for financial services firms as they sought to scale back the new rules.
With Nazareth on board, Davis Polk was hired as outside counsel on Dodd-Frank by the six largest U.S. banks and the Securities Industry and Financial Markets Association, the Wall Street trade group, according to the law firm’s website. The firm also performed work for foreign lenders including Credit Suisse Group AG (CS) and Deutsche Bank AG.
Nazareth’s e-mails to Schapiro and then-SEC General Counsel and Senior Policy Director David Becker, obtained through a Freedom of Information Act request filed by Bloomberg News, demonstrate how lobbyists and lawyers draw on bonds they formed in government service to gain access for clients, and how they work to maintain those ties.
Officials routinely leave federal agencies, Congress and the White House to work for the industries they once supervised. While that path is well-trod and legal -- with some time restrictions -- it still provokes handwringing in Washington. Nazareth’s communications provide an inside look at what happens when the revolving door spins.
Nazareth, 56, declined to discuss specific e-mails. She said that people like herself who have worked for both sides are valuable because they can “better translate to their clients” what the SEC is trying to achieve.
John Nester, an SEC spokesman, said those who used to work at the commission don’t get special access to the chairman. Schapiro “knows a lot of people in government, law, academia and consumer advocacy” and it’s not surprising that she e-mails and meets with some of them, he said.
“In the end, whether she or anyone in the agency agrees with a particular viewpoint or a specific request depends on whether it furthers the mission of the agency,” Nester said.
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Baker Botts Opens Brussels Office With Hogan Lovells Hire
Baker Botts LLP announced the opening of a Brussels office yesterday that will enhance the firm’s global antitrust and competition law practice.
Catriona Hatton, former managing partner of Hogan Lovells LLP’s Brussels office, has joined the firm and will be the partner in charge of the Brussels office. Paul Lugard, a competition lawyer and the former Global Head of competition law at Royal Philips Electronics, has also joined the firm as a partner in the office.
“Adding Brussels reinforces a strategic decision we made last year to expand our antitrust practice internationally,” said Baker Botts managing partner Andrew M. Baker. “Catriona and Paul bring to the firm decades of experience working at the highest levels of European competition law and policy. They join our highly regarded group of antitrust lawyers who have a strong record of involvement in international antitrust and competition law matters.”
Hatton advises clients on EC and member state competition law aspects of major mergers in all sectors of the economy.
At Royal Philips, Lugard managed antitrust matters for the company, securing merger clearances and advising on competition law, including where intellectual property and antitrust matters intersected, the firm said.
Brussels is the 14th office for Baker Botts and its eighth international location. The firm has more than 725 lawyers.
DLA Piper Announces New U.S. Co-Managing Partners
Anastasia “Stasia” Kelly and Michael Poulos will become DLA Piper LLP’s new U.S. co-managing partners on Jan. 1.
Kelly is a partner in DLA Piper’s corporate and finance and public company and corporate governance practices, as well as the firm’s white-collar corporate crime and investigations group. She joined DLA Piper in 2010 after 15 years as general counsel at four public companies: American International Group; MCI/WorldCom; Sears, Roebuck and Co.; and Fannie Mae.
Poulos is co-managing partner of DLA Piper’s Chicago office, regional chairman of the firm’s U.S. litigation practice and a member of the firm’s U.S. executive committee. Poulos, a senior partner in DLA Piper’s litigation practice, has first- chair trial experience in state and federal courts. He concentrates his practice in areas of complex litigation relating to consumer fraud, securities, insurance and professional malpractice litigation, as well as governmental investigations.
“Stasia and Mike are excellent lawyers, problem solvers, client relationship managers and business developers,” said Terry O’Malley, U.S. co-chairman of DLA Piper. “Their prospective appointment is the next step in our leadership transition process, which will formally take effect in January.”
Kelly and Poulos will join the incoming leadership team of Roger Meltzer and Cameron “Jay” Rains, who will become the firm’s U.S. co-heads for a four-year term, also on Jan. 1.
U.K. Serious Fraud Office Bribery Head Tumani Joins Kirkland
Kirkland & Ellis International LLP announced that Satnam Tumani, the head of the U.K. Serious Fraud Office’s Bribery and Corruption and International Assistance Departments, will join the litigation and dispute resolution practice of the firm’s London office on Sept. 24.
Tumani, who has more than 17 years of experience at the SFO, has been involved there in international and domestic corruption, investment fraud, company fraud, insider dealing, sanctions offenses and market manipulation matters, the firm said.
He was responsible for dealing with concurrent jurisdiction cases pursuant to the protocol between the U.K. and U.S. attorneys general and with European and Australian enforcement agencies. He also has been the joint SFO lead in the U.K.’s criminal investigations into the alleged manipulation of Libor and related interest rates.
“With the addition of Satnam, we will have former senior government enforcement officials and prosecutors across our offices in Europe, Asia and the U.S.; regions that are increasingly active and coordinated in global corruption and bribery investigations that may impact our clients,” said Jeffrey C. Hammes, chairman of Kirkland’s global management executive committee.
Kirkland is a 1,500-attorney law firm with 10 offices in the U.S., Europe and Asia.
Skadden Hires Corporate Lawyer Graham Robinson in Boston
Skadden, Arps, Slate, Meagher & Flom LLP hired corporate lawyer Graham Robinson as a partner in the Boston office. Robinson joins Skadden from Wilmer Cutler Pickering Hale and Dorr LLP, where he was a partner and chairman of its corporate practice.
He focuses on mergers, acquisitions and other transactions in the health care and technology industries in the U.S. and internationally. He also represents both private equity funds and hedge funds.
“Graham will be a terrific asset to our firm and the Boston office,” said Peggy Brown, head of Skadden’s Boston office and its Boston Mergers & Acquisitions Group. “His breadth of knowledge and experience in the health care and technology sectors will be of tremendous value to our clients.”
Skadden has 1,800 attorneys at 23 offices worldwide.
Seyfarth Shaw Adds Aptoex Global Head of Intellectual Property
Seyfarth Shaw LLP hired Shashank Upadhye as a litigation partner in the intellectual property practice in Chicago. Upadhye joins from Apotex Inc., a Toronto-based pharmaceutical company, where he was vice president and global head of intellectual property.
Upadhye’s practice includes pharmaceutical patent litigation, Hatch-Waxman law as it relates to generic and branded pharmaceutical companies and Federal Drug Administration regulatory law, the firm said. He has experience working on both the brand and generic sides at pharmaceutical companies, and he has advised and served as a consultant to businesses, financiers and government agencies.
Seyfarth Shaw has more than 800 attorneys in 10 offices throughout the U.S. and in London.
Mayer Brown Hires Dodd From Linklaters in Singapore
Mayer Brown LLP announced that Nathan Dodd has joined the firm’s global projects group as a partner in Singapore. Dodd has more than 13 years’ experience in the Asian legal market, with an emphasis on the energy, natural resources and infrastructure sectors. He joins the firm from Linklaters LLP, where he worked in London from 1997 until March 1999, when he transferred to Singapore.
“We are pleased to have Nathan join this growing team. A talented and seasoned practitioner, he will spearhead our projects group in Singapore, with a primary focus on the power, mining and infrastructure sectors in Asia, which are the areas with great potential in this part of the world,” Kevin Owen, partner-in-charge of the Singapore office, said.
Mayer Brown has 20 offices in the U.S., Europe and Asia.
Mengele Analogy Gets Judge Removed From Philip Morris Case
A Florida judge was disqualified from a wrongful-death lawsuit after he compared a former chief executive officer of Philip Morris Cos. to Josef Mengele, the Nazi war criminal who performed medical experiments on concentration-camp prisoners.
Senior Judge A.C. Soud of the Duval County Circuit Court in Jacksonville made the remarks at a June 19 hearing on the admissibility of a 1971 videotape which shows Joseph Cullman, then head of cigarette maker Philip Morris, suggesting that lower birth weight caused by smoking during pregnancy may be desirable to some women who “might prefer having smaller babies.” Cullman died in 2004.
The lawsuit, brought by the surviving spouse of Rayfield Brown, a deceased smoker, will be reassigned, according to the office of Chief Judge Donald Moran of the Duval County Circuit Court. Soud is out of the office until Sept. 10 and unavailable for comment, according to Rose D’Amour, Moran’s judicial assistant.
Soud rejected an immediate motion by attorneys for Phillip Morris to disqualify him from the case. After a written motion for disqualification was denied on July 20, the attorneys petitioned the First District of Court of Appeal in Tallahassee.
Kenneth J. Reilly of Shook, Hardy & Bacon LLP in Miami, who represented Philip Morris in the appeal, declined to comment on the ruling.
The case is Brown v. Philip Morris USA, 16-2007-CA-011175 BX, Fourth Judicial Circuit Court, Florida (Jacksonville).
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ING to Sell Entire Capital One Stake After Online Bank Deal
ING Groep NV (INGA) will sell a stake of more than 9 percent in Capital One (COF) Financial Corp. that the biggest Dutch financial- services firm acquired in the sale of its U.S. online bank this year.
Bank of America Corp. (BAC), Morgan Stanley (MS) and Citigroup Inc. (C) will jointly manage the public offering of about 54 million shares, McLean, Virginia-based Capital One said in a statement yesterday. Pricing is expected before regular trading opens today in New York, with settlement on Sept. 10, ING said in a separate statement.
ING acquired the stake, valued at about $3 billion as of Sept. 4, when Capital One bought ING Direct USA for $9.1 billion of cash and stock in February. The deal made Amsterdam-based ING the largest shareholder and entitled it to name a director to Capital One’s board. It prevented the Dutch lender from selling the holding until the lock-up ended, according to a June 2011 statement announcing the sale.
The Dutch bank and insurer was ordered by the European Union to sell its U.S. online bank as a condition of its government bailout during the financial crisis. The company, which received 10 billion euros in aid from the Netherlands in 2008, has returned 7 billion euros, plus 2 billion euros in interest and premiums.
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Judges Split on Crucial Issue for Defunct Law Firms
Two federal district judges sitting in the same Manhattan courthouse disagree on whether a defunct law firm is entitled to recover hourly fees clients pay to law firms that take over unfinished business. The outcome may affect the pending settlement with partners of Dewey & LeBoeuf LLP.
This week U.S. District Judge William H. Pauley III ruled in a case involving Thelan LLP that hourly fees earned on unfinished business by a new law firm are not property of the defunct firm. Pauley disagreed with a decision in May by U.S. District Judge Colleen McMahon who ruled in the liquidation of Coudert Brothers LLP that fees earned on unfinished business belong to the liquidated firm.
Because the case involves unresolved New York and California law, Pauley is allowing the parties to take an immediate appeal to the Court of Appeals without waiting for a final ruling in the lawsuits. The appeals court in turn may ask the highest state courts in New York and California to rule on the controlling state law issues.
Pauley’s case involved Thelen, a firm that filed for Chapter 7 liquidation in 2009. Beforehand, the Thelen partners signed a so-called Jewel waiver where they agreed not to invoke a California state court decision saying that fees earned at the new law firm on unfinished business must be paid to the defunct firm.
The trustee filed lawsuits against two firms who took in Thelen partners. The trustee contended that the Jewel waiver was a fraudulent transfer of firm property. Pauley disagreed in large part.
With regard to a New York firm, Seyfarth Shaw LLP, Pauley concluded that New York, not California, law governed. He proceeded to rule that Jewel is not law in New York with regard to unfinished business billed at hourly rates. He said that compelling lawyers at the new firm to turn over hourly fees would be an “expansion” of New York law and would violate “public policy against restrictions on the practice of law.”
If unfinished business were property of the defunct law firm, pending matters could be sold by a bankruptcy trustee. Selling cases, in Pauley’s view, would violate New York ethics rules for lawyers.
The case involving Robinson & Cole LLP presented a somewhat different picture. The Robinson firm agreed that California law applied.
Pauley concluded that the Jewel decision is no longer good law in California because the state adopted amended partnership law in 1994. The new law, Pauley said, means that the Robinson firm can retain “reasonable compensation” for completing unfinished matters. Pauley didn’t dismiss the suit, as he did with the Seyfarth case, because it would be necessary under California law to decide if Robinson received more than “reasonable compensation.”
In July, McMahon allowed parties in the Coudert case to go immediately to the appeals court. Presumably, the appeals court will hear the Thelen and Coudert cases together. To read about McMahon’s opinion in May, click here for the May 29, 2012, Bloomberg bankruptcy report.
Pauley’s case is Geron v. Robinson & Cole LLP, 11-cv-8967, U.S. District Court, Southern District of New York (Manhattan).
To contact the reporter on this story: Elizabeth Amon in Brooklyn, New York, at firstname.lastname@example.org.
To contact the editor responsible for this story: Michael Hytha at email@example.com.