Alison Frankel

Must read: Deal Prof’s study of competition for M&A litigation

January 17, 2012

I usually bail out of academic studies on litigation pretty quickly; if the data is stale or the papers don’t seem to account for real-world tactics by plaintiffs’ and defense lawyers, I don’t bother to keep reading. That’s why a just-released analysis by Matthew Cain, a finance professor at Notre Dame, and Steven Davidoff of Ohio State’s Moritz College of Law, is such a rarity. The paper, titled A Great Game: The Dynamics of State Competition and Litigation, features up-to-the-minute commentary and a deep understanding of why lawyers do what they do.

Inside the shadowy market for Madoff claims

January 14, 2012

One of the most intriguing offshoots of the mess Bernard Madoff created is the underground market for claims against the estate of his bankrupt securities firm. Last June, when the Wall Street Journal ran a revelatory story on big banks’ trading in Madoff claims, suits by Madoff trustee Irving Picard of Baker Hostetler seemed so promising that claims were trading at 75 cents on the dollar. But according to fascinating new litigation between Deutsche Bank and two Madoff feeder funds, the value of claims has been dropping ever since, and was down to 60 cents on the dollar last month. The billion-dollar declaratory judgment complaint by Kingate Global and Kingate Euro against Deutsche Bank doesn’t offer an explanation for the declining value of Madoff claims. But it’s not much of a leap of inference to guess that U.S. District Judges Jed Rakoff and Colleen McMahon of Manhattan federal district court have more than a little to do with it.

No free-speech protection for rating agencies… again: CA judge

January 13, 2012

The rating agencies S&P and Moody’s have struck out in their second attempt to nix a billion-dollar negligence suit by the California Public Employees’ Retirement System on free-speech grounds.

Google mandamus on Lindholm email: key test of client privilege

January 12, 2012

Remember the draft email from Google engineer Tim Lindholm that’s become the most hotly-litigated issue in Oracle’s Java software infringement case? In the now-notorious message, Lindholm informed the Google VP in charge of the Android operating system that he’d considered various technical alternatives to Java and concluded that “they all suck.” (He recommended taking out a license on Java software, which Google nevertheless opted not to do.) Google’s lawyers at Keker & Van Nest have fought like hell to keep the damning Lindholm email out of evidence, but U.S. District Judge William Alsup of San Francisco federal court has nevertheless ruled three times that the draft — whose recipients included a Google in-house lawyer — is not privileged and should stay in the public record. In November, Google took the drastic step of filing a petition for a writ of mandamus at the U.S. Court of Appeals for the Federal Circuit to reverse Alsup’s rulings.

Refco redux: Weil witnesses will be key if Collins retried

January 11, 2012

The U.S. Court of Appeals for the Second Circuit overturned the fraud conviction of former Mayer Brown partner Joseph Collins Monday because the Manhattan federal judge who oversaw the end of Collins’s 2009 trial, U.S. District Judge Robert Patterson, didn’t call in defense lawyers when he advised a dissident juror to resume deliberations. The Second Circuit’s 23-page opinion makes for pretty dramatic reading; the juror came to see Patterson with an account of being harassed and threatened for disagreeing with fellow jurors in the course of four days of deliberations. The jury foreman also sent notes to the judge pleading for help in defusing tensions in the jury room. Rarely are we privy to such a vivid, well-documented account of jury-room dynamics.

Employee class actions okay, Concepcion doesn’t apply: NLRB

January 10, 2012

The National Labor Relations Board stood up staunchly for the rights of employees Friday. In an 18-page ruling in a case called D.R. Horton, Inc. and Michael Cuda, the NLRB chairman and two members of the board held that a company may not cut off employees’ rights to collective action through private arbitration agreements. The ruling does not say employees are always entitled to litigate claims via class actions, but concludes that “employers may not compel employees to waive their [National Labor Relations Act] right to collectively pursue litigation of employment claims in all forums, arbitral and judicial.”

SEC settlement-language change is (at best) mere cosmetics

January 9, 2012

Late Friday the Securities and Exchange Commission confirmed in a statement what the New York Times first reported Friday morning: it has changed its policy on the boilerplate “neither admit nor deny” language in most SEC settlement agreements. But don’t get too excited. The change will affect only cases in which the defendant has admitted guilt or been convicted in a related criminal action. In settlements with those criminal defendants, the SEC will delete “inconsistent” concessions and instead “recite the fact and nature of the criminal conviction or criminal [admission] in the settlement documents.”

Louboutin red-sole trademark case: color war at the 2nd Circuit

January 6, 2012

When the U.S. Court of Appeals for the 2nd Circuit hears oral arguments later this month in shoe designer Christian Louboutin’s appeal to protect his trademark on red lacquered soles, the court will be presented with two starkly different views of what purpose color serves in fashion design.

No joy for MBS investors in NY judge’s bond insurer rulings

January 4, 2012

Tuesday’s parallel rulings by Manhattan State Supreme Justice Eileen Bransten in MBIA and Syncora suits against Countrywide were a big win for the bond insurers. The judge concluded that MBIA and Syncora need only show that Countrywide materially misled them at the time they agreed to write insurance on Countrywide mortgage-backed notes, not that the alleged misrepresentations led directly to MBS defaults and subsequent insurance payouts. Bransten is considered a leading judge on MBS issues, so her grant of summary judgment on the insurance fraud and contract issues should be a boon to all of the monolines engaged in do-or-die litigation with MBS issuers.

NY judge gives bond insurers many routes to MBS recovery v. BofA

January 4, 2012

There’s a cautionary note to MBIA deep in Manhattan State Supreme Court Justice Eileen Bransten‘s long-awaited, 27-page loss-causation decision in MBIA’s mortgage-backed securities case against Countrywide. The bond insurer, Bransten warned, must prove that it was damaged as a “direct result” of Countrywide’s allegedly material misrepresentations about the MBS certificates MBIA agreed to insure. “As has been aptly pointed out by Countrywide, this will not be an easy task,” the judge wrote.