Perkins Coie, Latham, Gibson Dunn: Business of Law
Perkins Coie LLP represented Zillow Inc. (Z), the operator of the largest U.S. real-estate website, in its $50 million purchase of New York-based StreetEasy. Latham & Watkins LLP represented StreetEasy in the deal.
Perkins Coie corporate partners David McShea and Andrew Moore; intellectual property partner Greg Mackay; benefits partner Kurt Linsenmayer and tax partner Carl Crow worked on the deal.
Latham lawyers who represented StreetEasy as well as its corporate parent NMD Interactive Inc. are corporate partners Alexander Temel and Philip Rossetti; counsel Bill Schwab; intellectual property partner Sarah Gagan; employee benefits and compensation partner Robin Struve; tax partners Samuel Weiner and David Kahn and securities partner William J. Trach.
StreetEasy has about 1.2 million monthly unique users, primarily residential real-estate shoppers in the New York region, the companies said in a statement. Seattle-based Zillow, which reported 61 million unique visitors at the end of July, separately announced a $412 million share sale after the market closed Aug. 19.
Facing increased competition from Trulia Inc. and other real-estate listings providers as the U.S. housing-market recovers, Zillow has been making acquisitions to maintain growth. Chief Executive Officer Spencer Rascoff said purchasing StreetEasy can help Zillow rapidly expand its presence in the largest U.S. market and use its sales team to bolster advertising and subscription revenue faster than StreetEasy could as an independent company.
Zillow, which bought San Francisco-based HotPads in December for $16 million in cash, said it may use proceeds from the share offering to make deals that complement its business.
For more on the deal, click here.
In the Courts
Porsche Plaintiffs Lose Bids for Access to Prosecutors’ Files
A Merckle Group unit and two other companies were denied access to Stuttgart prosecutors’ files that might have helped their civil lawsuits against Porsche SE over the failed bid for Volkswagen AG. (VOW)
The Stuttgart Higher Regional Court rebuffed an attempt to collect information from the investigation of former Porsche executives Wendelin Wiedeking and Holger Haerter, according to a judgment published in a database of court rulings. The Merckle unit, HWO GmbH, can’t be considered a victim of the alleged crimes, the judges said.
“Investors damaged by market manipulation aren’t victims” under the rules governing access to the files, the judges wrote. Market manipulation rules “do not directly aim to protect the investors, but only the public interest in truth and trustworthiness of price building at stock exchanges.”
The ruling is a setback for plaintiffs in the German cases against Porsche, which are seeking more than 5 billion euros ($6.7 billion) combined. German law grants only limited access to information from parties to lawsuits. Gaining access to findings by prosecutors in a criminal probe is a way to obtain additional evidence.
The Stuttgart Higher Regional Court spokesman Stefan Schueler said that the tribunal rejected bids by three companies, declining to identify them. The HWO ruling was in June, while the other two rulings were last week.
The civil suits are part of a series of cases Porsche has faced since it disclosed in October 2008 it controlled 74.1 percent of VW, partly through options, and was seeking to acquire 75 percent and eventually take it over. The announcement caused Volkswagen’s stock to surge as short sellers raced to buy shares borrowed in a bet that VW would fall.
HWO spokeswoman Vivien Kraft declined to comment yesterday.
The cases are OLG Stuttgart, 1 Ws 112/13, 1 Ws 149/13 and 1 Ws 150/13.
Michael Jackson’s Estate Challenges IRS in Dispute Over Tax Bill
Michael Jackson’s estate challenged a tax bill calculated by the U.S. Internal Revenue Service, arguing that it overvalued assets including real estate, a Bentley automobile and the late singer’s “image and likeness.”
The estate filed a petition in response to an IRS “notice of deficiency” issued in May regarding the estate’s tax return. All amounts in the document were redacted.
The valuations in the estate’s return “were accurate and based upon qualified appraisals by qualified appraisers who had extensive experience in valuing entertainment industry assets,” according to the petition. It was filed July 26 in U.S. Tax Court in Washington by attorney John Branca and music executive John McClain, the co-executors of Jackson’s estate.
Paul Hoffman, of Hoffman Sabban & Watenmaker, one of the attorneys filing the suit, declined to discuss the sums in dispute, saying only that “the IRS is wrong.”
Jackson died in June 2009 at age 50.
In addition to real estate, automobiles and intellectual property, the tax court filing takes issue with IRS valuations of a Lloyds of London “contingency non-appearance and cancellation” policy, Jackson’s share of MJJ Ventures Inc. and two trusts and other personal property.
The case is Estate of Michael J. Jackson v. IRS, 17152-13, U.S. Tax Court (Washington).
Law Firm Practice
ABA Issues Guidance on Fee-Sharing With Non-Lawyers
The American Bar Association has clarified when lawyers can divide client fees with firms in jurisdictions permitting fee-sharing with non-lawyers.
Most states follow what’s known as Model Rule 5.4(a) that prohibits fee sharing with individuals who aren’t attorneys. Washington is the notable exception: the jurisdiction does permit fees to be split with those working on a matter who aren’t attorneys. As a result fee-splitting became complicated.
The ABA’s Standing Committee on Ethics and Professional Responsibility, in the Aug. 19 guidance, permits fee-sharing without any violation of ethics rules if one of the firms is in a jurisdiction like Washington.
“A division of a legal fee by a lawyer or law firm in a Model Rules jurisdiction with a lawyer or law firm in another jurisdiction that permits the sharing of legal fees with nonlawyers does not violate Model Rule 5.4(a) simply because a nonlawyer could ultimately receive some portion of the fee under the applicable law of the other jurisdiction.”
To read the opinion, click here.
Law Firm News
Gibson Dunn Adds Skadden Partner Madden in London
Penny Madden, who was a partner at Skadden, Arps, Slate, Meagher & Flom LLP, joined the London office of Gibson, Dunn & Crutcher LLP. Madden, a solicitor, will continue her international arbitration and disputes practice.
“We are delighted to have someone of Penny’s caliber and excellent reputation join the firm,” Kenneth Doran, chairman and managing partner of Gibson Dunn, said in a statement. “She is a dynamic lawyer with a proven record of success for her clients. Our disputes practice is thriving in London and elsewhere, and we are focused on expanding our capacity, especially in international arbitrations.”
“Gibson Dunn has a collegial team environment that brings together different practice groups and offices to work seamlessly on important global matters,” Madden said in the statement. “I’m excited to be joining my new colleagues and starting this next chapter in my career.”
Sutherland Asbill Adds Partner in New York Office
Brian G. Barrett is joining the insurance and financial services practice of Sutherland Asbill & Brennan LLP. Barrett, who was most recently at Goldman Sachs as a vice president in the global liquidity products group, will become a partner in the firm’s New York office.
Barrett has securities and derivatives market experience with property casualty and life insurers, banks, broker-dealers, private funds and U.S.-registered investment companies. He has advised these clients on both asset- and liability-side transactions; on a wide variety of securitizations, financings, derivatives and collateral management transactions; and on regulatory issues under the Dodd-Frank Act, Basel 3 and the U.S. securities laws.
“Brian brings more than 20 years of experience in financial transactions as a lawyer, inside counsel and banker,” said Sutherland managing partner Mark D. Wasserman in a statement.
Jackson Lewis, Employment Firm, Adds Partner in Atlanta
Jackson Lewis LLP, a law firm specializing in employment and labor law, hired David A. Hughes as a partner in its Atlanta office. Hughes was previously a partner at Ogletree, Deakins, Nash, Smoak & Stewart PC, where he concentrated his practice on employment law counseling and litigation.
David Gordon, the managing partner of the firm’s Atlanta office, said in a statement that Hughes “is a skilled employment litigator and advisor, and I am confident his expertise will enhance our ability to serve our clients both locally and nationally.”
Hughes has over 20 years of employment law counseling and litigation experience, including jury and bench trials before state and federal courts throughout the country. He has litigated both single and multi-plaintiff cases and class actions involving a wide range of employment law claims.
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