Nixon Peabody Adds Bulger Prosecutor: Business of Law

Brian T. Kelly, the prosecutor who tried mobster James “Whitey” Bulger, is joining Nixon Peabody LLP as a partner in the government investigations and white-collar defense practice in Boston.

Kelly, who was chief of public corruption and special prosecutions, has been lead counsel in more than 30 trials in federal court. As an assistant U.S. attorney, he spent several years investigating financial fraud arising from Boston’s $14.5 billion project known as the Big Dig, recovering more than $500 million under the False Claims Act and other payments, the firm said. He has also supervised the investigation and prosecution of political corruption cases including the convictions of Massachusetts House Speaker Sal DeMasi, former House Speaker Tom Finneran, former State Senator Dianne Wilkerson, and former Boston City Councilor Chuck Turner, the firm said.

“Brian has the depth of experience few lawyers in the white collar defense bar can match given his role in some of the highest-profile public corruption and racketeering cases brought by the U.S. Attorney’s Office,” Andrew I. Glincher, the chief executive officer and managing partner of Nixon Peabody, said in a statement.

In his new position, Kelly will focus on representing clients in government investigations, regulatory compliance, white-collar criminal defense and health-care fraud matters

Other former government officials who now work at the firm include former U.S. Senator Scott Brown, a Republican from Massachusetts, and former Middlesex County, Massachusetts District Attorney Gerry Leone.

Nixon Peabody has more than 600 lawyers at offices in the U.S., London and China.

Weil Antitrust Litigator Joins Sheppard Mullin in New York

Antitrust lawyer Bruce A. Colbath, formerly of Weil, Gotshal & Manges LLP, has joined Sheppard, Mullin, Richter & Hampton LLP as a partner in the antitrust and trade regulation practice group in New York.

“Bruce is an aggressive litigator with a strong reputation in the antitrust field,” Guy N. Halgren, chairman of Sheppard Mullin, said in a statement. “Bruce represents an important strategic fit for our antitrust practice, specifically expanding capabilities in New York.”

Colbath has experience in advertising, marketing and antitrust law, including consumer protection issues relating to unfair deceptive and/or unlawful conduct, the firm said. He has represented clients in class actions and related litigations of a wide variety of claims, including false advertising, deceptive practices and antitrust, brought in federal and state courts throughout the U.S. at both the trial court and appellate levels, the firm said.

Colbath’s antitrust and consumer protection litigations include representing Airborne Health, Inc. in an advertising investigation by the FTC, a multi-state investigation by state attorneys general, and several private class actions and representing MasterCard in a state and federal MDL litigation challenging its currency conversion practices, as well as private class actions alleging that MasterCard’s currency-conversion practices were deceptive. He also represented L’Oreal USA in a nationwide antitrust class action that alleged cosmetics manufacturers and department stores allegedly conspired on the pricing of cosmetic products, the firm said.

The firm has 60 attorneys based in its New York office and 640 attorneys in 15 offices in the U.S., Europe and Asia.

News

The Inside Story of J&J Whistle-Blowers Who Made Millions

The government spent more than nine years investigating Risperdal before Johnson & Johnson (JNJ), the world’s biggest seller of health-care products, agreed Nov. 4 to pay $2.2 billion to resolve criminal and civil probes over its marketing of the drug.

Judy Doetterl, prosecutors and other lawyers offered an inside account of a decade-long probe that ended with eight J&J whistle-blowers making more than $20 million each, Bloomberg News’ David Voreacos and Sophia Pearson report.

The U.S. said J&J marketed Risperdal and two other drugs for off-label uses and paid kickbacks to doctors and pharmacists to boost sales. J&J’s Janssen unit pleaded guilty to misbranding Risperdal. The company also settled civil lawsuits filed under the False Claims Act, which lets citizens file sealed complaints on behalf of the government and share in any recovery.

Doetterl and four other former J&J employees filed such cases. They will each get about $29 million from the U.S. and state governments that claimed they overpaid through Medicare or Medicaid because of J&J’s practices. A sixth whistle-blower, Allen Jones, got $20.3 million last year when J&J paid $158 million to settle with Texas over Risperdal.

Interviews with Doetterl, 43, and Zane Memeger, the U.S. attorney in Philadelphia who oversaw the Risperdal probe, show the lucrative payday for whistle-blowers came after painstaking work by government investigators who battled a company that defended its conduct for almost a decade.

Memeger said his lawyers conducted parallel criminal and civil probes as they juggled other cases and faced multiple law firms defending J&J.

“A lot of times our attorneys are in a David versus Goliath situation,” said Memeger, who took office in May 2010. “You may have one attorney, maybe two attorneys, on the civil side, and maybe the same thing on the criminal side, but you’re facing law firms with teams and teams of lawyers.”

J&J also had to conduct its own investigation, he said.

“It’s high-stakes litigation,” Memeger said. “We’re talking about a significant amount of money. It’s going to take some time. You have attorneys who are very skilled on the government side trying to figure out what’s going on.”

For more, click here.

Deals

Five Firms on Sysco $3.5 Billion Deal for US Foods

Wachtell, Lipton, Rosen & Katz and Arnall, Golden & Gregory LLP are advising Sysco Corp. (SYY) on its agreement to acquire closely held US Foods Inc. for $3.5 billion, adding brands from Cattleman’s meat to Devonshire desserts, in the largest food-distribution deal in eight years in North America. The shares jumped the most in at least 33 years. Simpson Thacher & Bartlett LLP and Debevoise & Plimpton LLP are serving as US Foods’ legal advisers.

Andrew Brownstein, co-chairman of Wachtell Lipton’s corporate group, and Benjamin M. Roth, were the partners who led on the deal for Sysco. Other Wachtell Lipton partners included Damian G. Didden and Joseph D. Larson, antitrust; David E. Kahan, executive compensation and benefits; and T. Eiko Stange, tax.

Arnall Golden handled due diligence, securities, document review, and environmental review with Adam S. Skorecki as the lead attorney. Additional Arnall Golden partners involved are B. Joseph Alley Jr., Scott M. Shuman, John C. Spinrad and Sean P. Fogarty.

The Simpson Thacher team is led by Marni Lerner, mergers and acquisitions. Additional partners include Joe Tringali, antitrust; Andrea Wahlquist, executive compensation and employee benefits; Nancy Mehlman, tax; and Joe Kaufman, capital markets.

Debevoise, which is advising US Foods, and Clayton, Dubilier & Rice LLC, has a team that includes partners Paul S. Bird, David A. Brittenham and Steven J. Slutzky.

Sysco will pay $3 billion in common stock and $500 million in cash for US Foods to owners including KKR & Co. and Clayton, Dubilier & Rice LLC, according to a statement yesterday. Bonds of US Foods soared to a record.

Weil Gotshal & Manges LLP is advising Goldman Sachs on providing committed bridge financing backing the acquisition of US Foods. The Weil team was led by banking and finance partner Morgan Bale and capital markets partner Matthew Bloch, and included M&A partner Michael Aiello, environmental partner Annemargaret Connolly, structured finance and derivatives partner John Dedyo; and tax partner Larry Horton.

The deal bolsters Sysco’s position as North America’s largest distributor of food to restaurants, expanding its geographical reach and creating supply chain cost savings. The combined business, with about $65 billion in annual sales, will be led by Sysco Chief Executive Officer Bill DeLaney.

The transaction is the largest in the food wholesale and distribution industry since Albertsons LLC was sold to several buyers for $16.1 billion in 2006, according to data compiled by Bloomberg. Sysco was the most acquisitive company in the industry in the past 10 years in North America, with 27 deals, the data also show.

For more, click here.

Firm News

Sidley Chicago Real Estate Partner Arrested for Sexual Assault

Sidley Austin LLP Chicago real estate partner Stanley Stallworth was arrested last week along with his nephew and both were charged with sexually assaulting an 18-year-old man, the Chicago Tribune reported.

Stallworth’s bail was set at $150,000, which his attorney, who wasn’t identified, would pay, according to the newspaper.

Stallworth’s biography at the firm lists him as on leave as did a recording on his voice-mail. He joined the firm in 1990 and has handled real estate matters that include the acquisition and disposition of property and the negotiation of leases, among other matters.

“We understand that Stan has entered a plea of not guilty and intends to vigorously contest those allegations,” the firm said in an e-mailed statement. “While the charges do not relate to the firm or the practice of law, Stan has requested and has been granted leave from the firm to devote his full attention to addressing these charges.”

The alleged victim told authorities he met Stallworth’s nephew, who asked him over to his uncle’s home, the Tribune said. After drinking one and a half drinks, the alleged victim passed out and woke up to find both men sexually assaulting him, according to the newspaper.

Lawyer Profiles

Lawyer Suing China Bank for Terror Funding Is Own ‘Private CIA’

Fresh off a stint as a counter-terrorism adviser on Bill Clinton’s National Security Council, attorney Lee Wolosky was hoping to return to law. Most firms, he says, saw a guy with a two-year experience gap who’d need to start near the bottom, Bloomberg’s Patrick G. Lee reports.

Law firm chief David Boies pounced.

A dozen years after he hired Wolosky, Boies is poised to make good on his gamble. Wolosky, now a partner at Boies, Schiller & Flexner LLP, is suing Chiquita Brands International Inc. in a $1 billion terror finance class action for Colombian plaintiffs. He’s also suing Bank of China Ltd. for allegedly funneling money from Iran to a Palestinian terrorist group that staged an attack claiming the life of an American teenager in Israel.

The Bank of China case typifies the international-tinged caseload that Wolosky, 45, has carved out at Boies Schiller. If it goes to trial, the $100 million lawsuit could be groundbreaking: While the U.S. government has pressured banks and other governments to clamp down on money flowing to terrorist groups, Wolosky’s lawsuit could be the first by U.S. citizens against an alleged conduit to go to trial in federal court, says Gary Osen, whose six-person firm focuses on terrorism-financing lawsuits.

“These cases impact the thought process and behavior of global institutions that do business in the U.S.,” says Osen, who has reached confidential settlements in similar cases and has two more awaiting trial.

For more, click here.

To contact the reporter on this story: Elizabeth Amon in New York at eamon2@bloomberg.net

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

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