Cleary Gottlieb, Seward & Kissel, Mayer: Business of Law

A Washington lawyer with experience in major antitrust cases has been named head of litigation for the U.S. Justice Department’s antitrust division after the government sued to block the merger of AMR Corp.’s American Airlines and US Airways Group Inc. (LCC)

David Gelfand, a partner at Cleary Gottlieb Steen & Hamilton LLP in Washington, recently represented clients including Henkel AG, ArcelorMittal SA and Sanofi in antitrust litigation, according to the firm’s website.

Gelfand also represented Google Inc. before regulators in its acquisitions of AdMob Inc. and DoubleClick Inc. and was involved in transactions including Hertz Global Holdings Inc. (HTZ)’s purchase of Dollar Thrifty Automotive Group Inc., and Molson Coors Brewing Co. (TAP)’s merger with SABMiller Plc (SAB), according to the firm.

Gelfand, 54, will replace Joseph Wayland, who stepped down in November after two years at the division. Wayland led the department’s successful litigation to stop AT&T Inc. (T)’s takeover of T-Mobile US Inc. (TMUS) and H&R Block Inc. (HRB)’s attempt to buy a smaller competitor, acting as the lead courtroom lawyer for the government in both cases. Wayland is now general counsel of Ace Ltd. (ACE)

Seward & Kissel Adds Tax Partner in Its New York Office

Jonathan P. Brose joined the New York office of Seward & Kissel LLP as a partner in the firm’s tax group. According to a statement from the firm, Brose will focus his practice on investment funds, structured finance and capital markets transactions.

Brose joins Seward from Sidley Austin LLP, where he was a partner in their tax group. During his time at Sidley Austin, Brose developed an expertise in investment strategies for credit, distressed asset and commodities funds. His experience in tax law includes structured finance as well as restructurings. He also supplied tax advice to domestic and foreign entities on a variety of commercial transactions and capital market activities.

In the Courts

Sears Must Again Face Washing Machine Class Suit, Court Says

Sears Holdings Corp. (SHLD) must face consumer class-action litigation over alleged washing machine defects, a federal appeals court in Chicago ruled after being asked to reconsider the issue by the U.S. Supreme Court.

Consumers accused the suburban-Chicago based retailer of selling appliances with faulty computer control systems. They also alleged that the front-loading machines, made by Whirlpool Corp. (WHR) and sold under Sears’s Kenmore brand, accumulate mold.

After the appeals court last year said consumers in six states could pursue their claims collectively, Sears gained Supreme Court review. The high court, having earlier rejected class status in a case against Comcast Corp. for a lack of common damages, asked the Chicago panel to reconsider its ruling.

“There is a single, central, common issue of liability: whether the Sears washing machine was defective,” U.S. Circuit Judge Richard Posner said in a ruling released Aug. 22 reiterating that two classes be recognized.

“It would drive a stake through the heart of the class action device, in cases in which damages were sought,” Posner said, “to require that every member of the class have identical damages.”

Sears and Whirlpool “respectfully disagree,” with the appeals court decision, Chris Brathwaite, a spokesman for Hoffman Estates, Illinois-based Sears, said in an e-mailed statement. The companies will again seek Supreme Court review, he said.

The case is Butler v. Sears, Roebuck & Co., 11-8029, 12-8030, U.S. Court of Appeals for the Seventh Circuit (Chicago).

Google Seeks Court Approval of Search Privacy Settlement

Google Inc. (GOOG) asked a federal judge to approve a settlement of a lawsuit claiming the company transferred personal information contained in user searches to third parties including marketers and data brokers.

The lawsuit, before U.S. District Judge Edward Davila in San Jose, California, claims Google “consistently and intentionally” designed its searches to collect and send data -- including names, credit card numbers, Social Security numbers, account numbers, medical information and political beliefs --and that the information was sold and resold to “countless other third parties.”

Kassra Nassiri, a lawyer representing plaintiffs in the case, explained to Davila at an Aug. 23 hearing that users are concerned about their privacy because that data is now aggregated in such a way that any single Google search “will be associated with them in the future.”

Nassiri and Edward Johnson, a lawyer for Google, asked Davila for approval of a settlement requiring Google to post disclosures on a “Frequently Asked Questions” page of its website telling users whether their search queries are transmitted to third parties, and allowing them to make decisions about their privacy choices, according to a court filing.

Google will also pay $8.5 million that will be distributed to privacy research and will start an “elaborate advertising campaign” to generate 200 million hits at various websites explaining the agreement, Johnson, a Mayer Brown LLP partner, said.

Davila expressed skepticism about how many people will read Google’s Web page produced as a result of the settlement, and asked for detailed information about how the privacy organizations were selected.

The case is Gaos v. Google, 10-cv-04809, U.S. District Court, Northern District of California (San Jose).

US Airways Must Face Frequent Flier Suit Over Mileage Credit

US Airways Group must face a lawsuit from a frequent flier claiming the carrier is cheating its loyalty rewards program members when determining how many miles they’ve flown.

U.S. District Judge Harry D. Leinenweber in Chicago on Friday denied the airline’s bid for dismissal of the lawsuit filed this year by Dividend Miles program member Annette Kwok of Washington.

Kwok claims the airline “misled and deceived millions of its members” by crediting them with fewer miles than they’ve actually flown in conflict with the terms of its program membership guide.

“While defendants argue that the guide’s unambiguous language illustrates that they are not in breach, the court disagrees,” Leinenweber said.

Claiming breach of contract, Kwok is seeking class action status on behalf of all current and former Dividend Miles Program members who have been awarded less miles than flown on qualifying flights plus unspecified compensatory damages.

The Tempe, Arizona-based airline’s media relations department didn’t immediately respond to a phone message seeking comment on last week’s ruling.

The U.S. Justice Department on Aug. 13 sued to block U.S. Airways’ planned merger with AMR Corp’s (AAMRQ) American Airlines, which would create the world’s biggest airline.

The case is Kwok v. US Airways Group, 13-cv-02068, U.S. District Court, Northern District of Illinois (Chicago).

To contact the reporter on this story: Ellen Rosen in New York at erosen14@bloomberg.net

To contact the editor responsible for this story: Michael Hythas at mhytha@bloomberg.net

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