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Sunday, March 31, 2013
Solo Sanity: How to Control the Anxiety
International Law Opportunities at Suffolk University Law School
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Therapeutic Jurisprudence and Employment Law
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Firing John Adams
The Kootenai County commissioners unanimously passed a resolution on Tuesday to end his term this fall.
"It's absolutely a termination," Adams said.
Adams said the termination notice comes three weeks after he made a formal complaint against Commissioner Jai Nelson, saying she had allegedly harassed him since she joined the board. The notice comes two weeks after Adams, 59, told Commission Chairman Todd Tondee that he has cancer and will be undergoing chemotherapy and will need a day off each week for the treatment. Facing the loss of his health insurance is scary, Adams said.
It will be personally devastating, given that he's suffering cancer. It will be institutionally worse, given that he ran an exceptionally effective office. Adams learned that "his services were no longer needed" in a one-line memo, which he called "shabby." That seems like a nice way to put it. Disgraceful seems more appropriate.
The official explanation for Adams' unceremonious termination is, as government's so love, a study.
"He may be reappointed," Nelson said Friday. "Periodic evaluation is something that's part of the commissioners' duty."Nelson said the commissioners are going to do a "comprehensive study" of the county's public defense system. Setting an expiration date for Adams' services is the first step in that process, she said.
After all, when something is working well, doesn't that demand a study? Particularly when the person announcing the study is the same person against whom a harassment complaint had been lodged a few weeks before. Of course, it could very well be accurate, that a study is needed to figure out why the public defender is doing so well. Government can't run an efficient criminal justice machine when the public defender keeps getting in the way.
And as day follows night, the excuses follow the explanation.
"They're just going to put somebody in there who they think they can control," Adams said. "These terms aren't meant to be indefinite," Nelson said. "People don't own these offices."Nelson said the county hopes to complete its study by this fall. At that time, it's unlikely the commissioners will choose to reappoint Adams.
It's true that political appointees don't "own" their offices, but people who do their job well, extremely well, are usually the ones that get to stay in them. In a rational world, anyway. But then, doing a job well is a matter of perspective. The staff in his office rated John Adams' job performance well, giving him 9 to 10 on a ten scale for his various administrative functions. Some just gave him 10 across the board. He was deeply admired by his people.
Nelson, the accused harasser, didn't think as well of him.
In a Sept. 30 report of Adams' job performance, Nelson wrote: "The relationship between you and the board has continued to deteriorate over the last year and there have been several instances where you have communicated with the board members in an angry, disrespectful and unprofessional manner."
She said he needed improvement in budgeting, "respectful communication," following "board directives," attendance, and "timely response in communicating issues and concerns with a concerted effort at internal resolution of conflicts."
She graded him a "6" in "job understanding" on a scale of one to 10. He got a "5" in job performance, "6" in productivity, "6" in dependability and efficiency, and "3" in cooperation. His overall score was "5," putting him in the "marginal" range, meaning his performance requires improvement and he needs more than normal supervision.
There is certainly a problem when a public defender, an appointee of a local political body made up of very important people, is accused of the inability to communicate with those very important people except in an "angry, disrespectful and unprofessional manner." Then again, when the public defender has been communicating just fine for the past 17 years, and the problem suddenly arises, maybe the very important people have the problem backwards.
Or maybe the complaints are about the wrong problem. John Adams was universally respected by the bench and bar, and his only detractors happened to sit on the board that thought he worked for them. As the public defender, he thought he worked for the men and women of Kootenai County he was appointed to serve. He did so with distinction, with honor, with zeal. He fought for their rights in court, and for the resources to serve them before the tightwads who couldn't imagine why they should squander money on poor criminals. Most of all, he didn't ask "how high" when directed to jump. That's downright insubordination.
The article in the Coeur d'Alene Press offers a lengthy list of people praising John Adams, as lawyer, as public defender, as an honorable man. Coming on the heels of Gideon's 50 birthday, when so many opined that the tide is turning, that people are coming to realize that innocent people get convicted and the public defense function may be the only thing that stands between them and a lifetime in prison for a crime they didn't commit, this offers a very different, very ominous message.
They ought to build a statue for John Adams in Coeur d'Alene, Idaho. Instead, he's been hung out to dry, cancer and all, for doing his job too well. Believe in happy things all you want, but this is how fragile the defense of the accused can be, a one-line memo way from termination at the hands of a hater.
© 2012 Simple Justice NY LLC. This feed is for personal, non-commercial & Newstex use only. The use of this feed on any other website is a copyright violation. If this feed is not via RSS reader or Newstex, it infringes the copyright.
Source: http://blog.simplejustice.us/2013/03/24/firing-john-adams.aspx?ref=rss
Revisiting Voter ID Laws
Source: http://legaltalknetwork.com/podcasts/lawyer-2-lawyer/2012/10/revisiting-voter-id-laws/
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Transvaginal Mesh Complications and Litigation
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Act Two: Legal Tech Pioneers Return to Compete in Legal Tech Market
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Helpful Tips for Women Solo Practitioners
Source: http://legaltalknetwork.com/podcasts/new-solo/2012/02/helpful-tips-for-women-solo-practitioners/
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Saturday, March 30, 2013
Legal Talk Network Live at LegalTechNY 2012-LexisNexis’ Loretta Ruppert on Launch of Firm Manager
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Inside Midnight Regulations
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Legal Talk Network Live at LegalTechNY 2012-LexisNexis’ Loretta Ruppert on Launch of Firm Manager
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Second Circuit Rules That Putative Auction Rate Securities Class Action Complaints Failed to Adequately Plead Antitrust Conspiracy
In Mayor and City Council of Baltimore v. Citigroup, Inc., No. 10-0722-cv(L) and 10-0867-cv(CON), 2013 WL 791397 (2d Cir. Mar. 5, 2013), the United States Court of Appeals for the Second Circuitupheld the dismissal of two related class action complaints brought on behalf of purchasers of auction rate securities (“ARS”) and ARS issuers, respectively, against a number of large financial institutions. The complaints alleged that the financial institutions violated Section 1 of the Sherman Act, 15 U.S.C. § 1, by conspiring to stop purchasing ARS, thereby rendering ARS almost valueless and triggering the collapse of the ARS market. The Second Circuit based its holding upon a principle first announced by the United States Supreme Court in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) [see blog article here] — that antitrust complaints must allege sufficient factual matter to allow a fact-finder to plausibly infer that the plaintiffs’ alleged injuries were the result of an unlawful conspiracy, rather than independent parallel business conduct.
ARS are long-term bonds with interest rates that fluctuate depending on the outcome of periodic auctions. Since its conception, the ARS market has been concentrated among a group of elite financial institutions that underwrote the issuance of ARS. Auctions would occur at times dictated by a given ARS issuance’s offering documents (typically every 7, 28 or 35 days). If ARS up for auction sold out (demonstrating high demand), the interest rates on the ARS would reset at a lower rate — specifically, the auction would “clear,” such that all of the ARS subject to that auction would reset to the rate at which the last order in the auction was filled.
Because no secondary market for ARS developed, ARS were difficult to liquidate and could not be sold for par value outside of the required auctions. Further, if an auction did not sell out (indicating that there were more people looking to sell than to buy), the auction would “fail” and no ARS could be exchanged — putative sellers would be stuck with their ARS — and the interest rates would default to the maximum rate set out in the offering documents. Because of the dire consequences of a failed auction, the defendant financial institutions would sometimes intervene in the auctions by using proprietary trading accounts to place “support bids” which would result in clearing the auctions despite insufficient external demand.
As the financial market deteriorated throughout 2007 and early 2008, these support bids became increasingly critical to clearing auctions. There were a few isolated failures in 2007, but the ARS market began its implosion on February 12, 2008, when many of the auctions scheduled for that date failed. On February 13, 2008, eighty-seven percent of the auctions failed, and by the next day, the ARS market had essentially shut down. Plaintiffs filed their class action complaints in September of 2008, claiming that defendants had conspired to restrain trade by refusing to issue support bids to protect the auctions they managed.
The United States District Court for the Southern District of New York dismissed the complaint, relying upon the Supreme Court’s decision in Credit Suisse Securities (USA) LLC v. Billing, 551 U.S. 264 (2007) [see blog article here]. The Second Circuit affirmed the dismissal, but did so based on a Twombly analysis, and therefore did not reach the question of whether the Southern District’s Billing analysis was correct.
The Second Circuit explained that the facts pleaded in a complaint must raise a reasonable expectation that discovery will reveal evidence of illegal conduct and that mere legal conclusions couched as factual allegations will get no consideration at all. To state a claim under Section 1 of the Sherman Act, the complaint must allege sufficient facts — as opposed to mere labels or legal conclusions — making the inference that the plaintiff’s injuries were the result of an unlawful conspiracy more plausible than competing inferences, such as that the injuries result from independent, legitimate business decisions by similarly situated actors. The required factual allegations — referred to by Twombly and its progeny as “plus factors” — can include allegations that parallel acts were against defendants’ individual economic self-interests, or that competitors frequently communicated with each other.
In this case, the plaintiffs failed to adequately plead the requisite Twombly plus factors. For example, although plaintiffs pled two interfirm communications, the vast majority of alleged communications were intrafirm. The Court found these predominantly internal communications were insufficient to demonstrate more than a high level of interfirm awareness, which is not in itself unlawful.
Plaintiffs also failed to connect any plus factors to the alleged conspiracy. The Court observed that “the [ARS] market as a whole was essentially holding its breath and waiting for the inevitable death spiral of ARS auctions,” which made “abandoning bad investments [] not just a rational decision, but the only rational business decision.” In other words, the most plausible explanation for defendants’ simultaneous withdrawal of support for ARS auctions was not an antitrust conspiracy, but independent (and widespread) assessments that the ARS market was dying and ARS were a bad investment.
The Second Circuit underscored its unease with permitting large antitrust class actions to proceed absent a well-documented inference of conspiracy, noting: “[i]f we permit antitrust plaintiffs to overcome a motion to dismiss simply by alleging parallel conduct, we risk propelling defendants into expensive antitrust discovery on the basis of acts that could just as easily turn out to have been rational business behavior as they could a proscribed antitrust conspiracy.”
For further information, please contact Rena Andoh at (212) 634-3092.
Medicare Set Aside Arrangements and Mass Torts
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Living in a Public Beta
Source: http://legaltalknetwork.com/podcasts/kennedy-mighell-report/2012/10/living-in-a-public-beta/
Right to Bear Arms Doesn't Include Billy Club
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Gone Clio with Attorney Bruce Godfrey
Source: http://legaltalknetwork.com/podcasts/gone-clio/2012/06/gone-clio-with-attorney-bruce-godfrey/
Friday, March 29, 2013
America's First Great Depression: Economic Crisis and Political Disorder after the Panic of 1837
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Avvo Answers: Shut Up and Put Down the Weapon
Here's the moral right up front: Don't let incompetency or ethical challenges impair the desire for personal gain when it comes to a business model.To the credit of the profession, most did the right thing in responding to a question posed at Avvo.
Lawyers have a special word for questions posed in this fashion. It's called a confession. One might suppose that the young person asking the question would appreciate this, but then, this is all about getting free legal advice, and how can any lawyer provide competent advice without knowing the critical details, like guilt?Can I pursue probation without verdict?
Asked 1 day ago - Pittsburgh, PA
The house I was staying at was raided. I am a student who was living in the dorms last semester, had a lease signed for a house beginning June 1st. Between then I was living at my friend's house, and also my girlfriend's house. Found in the house that was raided was 7lbs of marijuana, xanax, and five ounces MDMA. I was charged with everything possession of the three and intent to deliver marijuana and MDMA. The marijuana and xanax was in a safe and was not mine. I had no contact with it at all. Three ounces of MDMA belonged to me, however, lab tests will confirm that it is not MDMA. I believe it will come up as a synthetic cathinone. A warrant is out for the owner of the marijuana and xanax. I was told those charges will be dropped from me as soon as he confesses to owning them.
This person got nine responses from attorneys, all saying pretty much the same thing. Shut up and get a lawyer. As Charles Thomas added:
As my colleagues said, you should stopping so much info on this site. I just Googled the facts you gave and I found news articles about this bust (believe me, 7 pounds of weed is pretty Google-able).One miracle of technology is that a person can pose a question on the internet and get lawyers to respond. Another miracle is that someone can Google the information and find out who just confessed to a crime. Cool, right?
Stop talking to anyone who isn't your lawyer — that includes co-defendants, friends, parents, AVVO, Facebook, or Twitter.
This prompted Leo Mulvihill to offer some free advice at Philly Law Blog.
What does this mean for Avvo Answers? Everybody loves free. Most, however, do not love being convicted. Despite the sweet sounds of the Reinvent the Future of the New Normal Law choir, this is the ugly side of their beloved technology, the Utopian vision of everyone having the capability to pretend to be a lawyer, the false god of transparency.So if you’re a criminal defendant, or a potential criminal defendant, do the following:
- Shut up.
- Don’t post on about your case on the internet. This means Avvo, Facebook, Twitter, MySpace, Instagram, Grindr — WHATEVER.
- Call an attorney immediately.
- Did I mention SHUT UP?
Talking on the internet cannot help you. It can, and will, only hurt your case.
The reality is that if you give a loaded weapon to children, they will eventually figure out how to use it. Chances are they will get hurt. You can hold hands and pray to the tech gods all you want, but it's not going to make this confession go away.
© 2012 Simple Justice NY LLC. This feed is for personal, non-commercial & Newstex use only. The use of this feed on any other website is a copyright violation. If this feed is not via RSS reader or Newstex, it infringes the copyright.
Source: http://blog.simplejustice.us/2013/03/28/avvo-answers-shut-up-and-put-down-the-weapon.aspx?ref=rss
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Digital Cameras in Law: Are Smartphones Good Enough?
Source: http://legaltalknetwork.com/podcasts/kennedy-mighell-report/2013/02/digital-cameras-in-law/
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Experience User-Friendly Systems
Source: http://legaltalknetwork.com/podcasts/tech-experts/2012/10/experience-user-friendly-systems/
LawBiz® Legal Pad: Ethical Considerations in Collecting Your Fee
Ed discusses managing a client's fee expectations.
Source: http://feeds.lexblog.com/~r/LawBizBlog/~3/fvCZB2A7364/
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Legal Issues Created by Story World Communities and Transmedia
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Can't support JURIST financially? We still want to hear from you!
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Secure Your Legal Data in the Cloud
Source: http://legaltalknetwork.com/podcasts/tech-experts/2012/07/secure-your-legal-data-in-the-cloud/
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Thursday, March 28, 2013
Brainless Blunders in E-Discovery Searches
Top Legal Blogs & State of the Blawg-osphere in 2013
Source: http://legaltalknetwork.com/podcasts/kennedy-mighell-report/2013/02/best-legal-blawgs-blawgosphere/
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Recommendations for a Social, Mobile and Global Legal Profession
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Gone Clio with Attorney Beate Weiss-Krull
Source: http://legaltalknetwork.com/podcasts/gone-clio/2012/01/gone-clio-with-beate-weiss-krull/
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The Only Constant is Change: FRCP Amendment Updates and Departures from the Zubulake Gold Standard
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Divided Supreme Court voids class certification in Comcast antitrust suit
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Prop 8 Debate: What About the Children?
Source: http://blogs.wsj.com/law/2013/03/26/the-prop-8-debate-what-about-the-children/?mod=WSJBlog
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Wednesday, March 27, 2013
Privacy: Sold For A Shiny Gadget
The Internet is a surveillance state. Whether we admit it to ourselves or not, and whether we like it or not, we're being tracked all the time. Google tracks us, both on its pages and on other pages it has access to. Facebook does the same; it even tracks non-Facebook users. Apple tracks us on our iPhones and iPads. One reporter used a tool called Collusion to track who was tracking him; 105 companies tracked his Internet use during one 36-hour period.
We're staring down an apparent dilemma.
Increasingly, what we do on the Internet is being combined with other data about us. Unmasking Broadwell's identity involved correlating her Internet activity with her hotel stays. Everything we do now involves computers, and computers produce data as a natural by-product. Everything is now being saved and correlated, and many big-data companies make money by building up intimate profiles of our lives from a variety of sources.
Facebook, for example, correlates your online behavior with your purchasing habits offline. And there's more. There's location data from your cell phone, there's a record of your movements from closed-circuit TVs.
This is ubiquitous surveillance: All of us being watched, all the time, and that data being stored forever. This is what a surveillance state looks like, and it's efficient beyond the wildest dreams of George Orwell.
We love computers. We love what computers have done for our lives. Whether it's watching Youtube, chatting it up with our virtual pals or finding a pair of shoes, the computer is integral to our existence. And as Schneier tells us, the computer knows everything about us. We've told the computer everything about us when we let Facebook (or whatever your favorite may be) into our lives.
And in return, we got some new shoes, a friend named Joe327 and hours of laughing at kitteh videos.
Was it worth the trade? Society has responded with a resounding YES!!! Most of us have known for quite a while that we're leaving behind footprints that tell anyone interested in knowing all about us, yet continue to use the internet with abandon. We may have no real grasp of how all this technology works, but we know we've sacrificed our privacy for the convenience and fun of shiny gadgets.
To their credit, some technology companies have refused the government's efforts to hand over our deepest secrets upon demand. But it's not exactly a foolproof method of protecting privacy, as businesses have other concerns than keeping our privacy ours.
This isn't something the free market can fix. We consumers have no choice in the matter. All the major companies that provide us with Internet services are interested in tracking us. Visit a website and it will almost certainly know who you are; there are lots of ways to be tracked without cookies. Cellphone companies routinely undo the web's privacy protection.
Fixing this requires strong government will, but they're just as punch-drunk on data as the corporations. Slap-on-the-wrist fines notwithstanding, no one is agitating for better privacy laws.
Strong government will? The last thing the government wants is our privacy to be left intact. It makes law enforcement so much harder, when the total loss of privacy allows unfettered access to whatever information makes their case.
So, we're done. Welcome to a world where Google knows exactly what sort of porn you all like, and more about your interests than your spouse does. Welcome to a world where your cell phone company knows exactly where you are all the time. Welcome to the end of private conversations, because increasingly your conversations are conducted by e-mail, text, or social networking sites.
And welcome to a world where all of this, and everything else that you do or is done on a computer, is saved, correlated, studied, passed around from company to company without your knowledge or consent; and where the government accesses it at will without a warrant.Welcome to an Internet without privacy, and we've ended up here with hardly a fight.
Schneier doesn't write this to make us feel bad, or stupid. He writes this because we've allowed ourselves to be screwed without putting up a fight. This is a challenge to every computer user, emailer, kitten video lover, to stop giving our privacy away for free.
We're done, but only for the moment. We can become undone if computer users (read: everyone) stop enjoying the miracles of modern technology long enough to give a damn about modern reality. Rather than vote for the politician who want to protect your guns or take them away, protect a women's right to chose or outlaw abortions, protect a scientific education that isn't dictated by someone's bible, we can start demanding that our elected officials start protecting our privacy from our government. We still get to vote, you know.
Schneier nails down two immutable facts: first, we are now a computer based society, and they are pervasive in our lives. This isn't going away. Second, technology knows everything about us.
We are still at the infancy of technology, and can still change the path we've gone down that offers up every aspect of our privacy for the pleasure of internet convenience. The death of privacy and the joy of technology do not have to co-exist. We've allowed it to happen because we were so transfixed by shiny gadgets that we couldn't divert our eyes long enough to see the consequences.
But we have a long future ahead of us, and computers will be a part of it. Unless you have no problem with the government knowing what porn you're pulling up on Google when no one else is around, you better start caring about this issue and acting on it. We do not have to give up privacy for the internet. We are not yet done.
© 2012 Simple Justice NY LLC. This feed is for personal, non-commercial & Newstex use only. The use of this feed on any other website is a copyright violation. If this feed is not via RSS reader or Newstex, it infringes the copyright.
Source: http://blog.simplejustice.us/2013/03/17/privacy-sold-for-a-shiny-gadget.aspx?ref=rss
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Justice Kagan: Drive American
To celebrate one of the foundational victories for criminal defendants, Supreme Court Associate Justice Elena Kagan went to the Attorney General's home at the Department of Justice. She received no invitation from the Defender General, because there is none. And if there was, his home would be far less hospitable than the Grand Hall of the Department of Justice, a euphemistic agency given that it only houses prosecutors.
From the Blog of Legal Times:
Speaking before a standing-room only crowd in DOJ's Great Hall with U.S. Attorney General Eric Holder Jr. and former Vice President Walter Mondale, Kagan said the provision of a "Cadillac" lawyer isn't a right for poor defendants. But they should at least have a "Ford Taurus" defense, complete with a lawyer who has the skills, resources and competence necessary to thoroughly advise a client.
While I love car analogies as much as the next guy, though neither automobile chosen by Kagan as examples are high on my list for fascinating discussion, the comparison was destined to raise hackles. And indeed it did.
Why are poor defendants relegated to a second class defense? Why a Ford Taurus when the prosecution gets a Stealth Bomber? Why? Her ultimate point was that indigent defendants aren't even getting a Taurus now, and that's inadequate.
"We don't have the resources to make [a Cadillac defense] happen," Kagan said. "And I'm not sure if we did have the resources that that's exactly what we should want."
But even a Taurus defense is hard to come by, she said.
So what is it that a Supreme Court Justice thinks defendants receive? A Yugo defense? Maybe an Edsel? If a Taurus is required, and they are only getting a Pinto, do they get a Vega to make up the difference? The problem with analogies is they leave us with some vague sense of comparison without any meaningful standard.
But Attorney General Holder decided to help Kagan out but putting his idea of a good thing into the mix.
During the event, Holder announced $1.8 million in new resources to support criminal legal defense. Indigent defense is in a "state of crisis," said Holder, who in 2010 launched the Access to Justice Initiative in an effort to make legal services accessible and affordable to all Americans.
A whole $1.8 million? That's enough to buy a spark plug (at government contract rates) for every public defender in Brooklyn, staving off a "state of crisis" in the spark plug industry, but it won't scratch the surface of getting poor defendants into Ford Tauruses. Not even old, broken down used ones.
Justice Kagan questions whether a "Cadillac" defense is what we want anyway. The only reason that I can think of for saying this is that it's too expensive for the taxpayer, to give every indigent defendant a great lawyer with all the bells and whistles that money can buy. It's a curious concern, given that the prosecution has the police, the option to charge and prosecute and the hearts and minds of the public and the courts.
But the analogy isn't quite fair and isn't really fitting. Granted, Supreme Court Justices have no power of the purse to spread the wealth, divvy up the cars in the lot so that the defense and the prosecution are in relative parity. They do, however, have the authority to wipe Strickland v. Washington from the books. They could make the rule a right to effective assistance rather than ineffective, a threshhold that allows for a fouled carb to pass muster.
They can hold that a defendant was denied his constitutional right to counsel when his lawyer sleeps through his trial, fails to investigate, can't be bothered to speak with his client, demonstrates no effective ability to mount a defense. Are these the attributes of a Cadillac? More like a Ford Taurus with a cracked block, no breaks and a dead battery. See how anybody can use analogies?
Even A.G. Holder can contribute to the cause, given his proclaimed concern for the extant state of crisis, by ordering his underlings not to charge every conceivable crime given the allegations as presented by their vast army of law enforcers, without regard to proportionality, propriety, purpose. The feds do because they can, and they can because Congress has exempted them from the speed limit that applies to the rest of us by creating new crimes on top of existing crimes, raising the penalties to life plus cancer whenever an election is coming in the next two years and a story of a dead victim hits the papers. But I digress.
Straining to understand why someone as smart as Elena Kagan would use such an ill-conceived analogy, one so obviously destined to criticism while being absurdly inadequate to make a valid point of the failure to provide even adequate representation to so many poor defendants, it finally dawned on me. This wasn't about poor defendants at all.
This was Justice Kagan's homage to the American automobile industry, too big to fail and therefore worthy of billions of dollars that might, in some alternate universe, have gone to providing American citizens with competent representation. The only remaining question was whether the Supremes were adequately compensated for the product placement.
The United States of America has funds when it needs to drop bunker buster bombs on a desert despot who isn't our pal any longer, and private enterprise that has run its products into the ground such that no one will buy them. This nation is happy to leave the last breath of young Americans on foreign soil while sucking the last breath from other young Americans in solitary confinement for crimes they didn't commit. If this nation wanted to, they could provide every person hauled before a court with a lawyer, one with the time and resources to do a proper job, a Ford Taurus job.
But the United States of America is more concerned about the viability of the Ford Taurus then poor criminal defendants, and that, I submit, is how they got Elena Kagan to be the new spokesjurist. Don't be surprised to see a guy chiseling a new slogan in the lintel over the courthouse doors, Drive American.
© 2012 Simple Justice NY LLC. This feed is for personal, non-commercial & Newstex use only. The use of this feed on any other website is a copyright violation. If this feed is not via RSS reader or Newstex, it infringes the copyright.
Source: http://blog.simplejustice.us/2013/03/20/justice-kagan-drive-american.aspx?ref=rss
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The Politics Of Guns And The Influence Of Advertising
New York City Mayor Michael Bloomberg launched a $12 million ad campaign in 13 states this week to persuade senators to support gun control legislation. The ads promote universal background checks as a prerequisite for gun ownership.
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The Path to Becoming a Solo Practitioner
Source: http://legaltalknetwork.com/podcasts/new-solo/2012/06/the-path-to-becoming-a-solo-practitioner/
Biggest Mistakes by Lawyers in Business Development
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David Lange: Golan, Again
Source: http://legaltalknetwork.com/podcasts/suffolk-law/2012/03/david-lange-golan-again/
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A Look Ahead: Hiring and Compensation Trends for 2013
Source: http://www.roberthalflegal.com/podcasts
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US transfers full control of Bagram prison to Afghanistan
Source: http://jurist.org/paperchase/2013/03/us-transfers-full-control-of-bagram-prison-to-afghanistan.php
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Tuesday, March 26, 2013
LawBiz® Legal Pad: Business Competency for Lawyers
Your law practice is a business. You should know how to run it like one.
Source: http://feeds.lexblog.com/~r/LawBizBlog/~3/ee_owpnOC6g/
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California Court of Appeal Recognizes That Wide Discretion Granted to a Board of Directors Under the Business Judgment Rule May Be Tempered By a Corporation's Private Contractual Obligations to Its Shareholders/Members
In Scheenstra v. California Dairies, Inc., No. F062768, ___ Cal. Rptr. 3d ___, 2013 WL 363148 (Cal. App. 5th Dist. Jan. 30, 2013), the California Court of Appeal, Fifth District, affirmed the judgment of the California Superior Court, Tulare County, that the board of directors of defendant California Dairies, Inc. (“Cal Dairies”), a milk marketing and processing cooperative, had exceeded its discretion when it adopted a quota system that breached its contractual obligations to its members and exceed the grant of power in Cal Dairies’ Bylaws. This decision highlights that a board of director’s discretion under the business judgment rule may be limited by contractual obligations the corporation undertakes with the corporation’s shareholders/members.
Cal Dairies markets its members’ milk to the best advantage of its members. Upon joining Cal Diaries, a member agrees to be bound by the cooperative’s Bylaws as they exist and as they may be amended. The Bylaws thus constitute a contract between Cal Diaries and each of its members.
One such member was plaintiff John Scheenstra. Between 2002 and 2007, plaintiff began expanding his milk production capacity. In the fall of 2007, the board of directors of Cal Dairies began considering the need to reduce the milk production of its members due to anticipated overproduction. The board decided to exercise the discretionary authority granted in section 7.3 of Cal Dairies’ Bylaws to institute an internal production quota. Section 7.3 of the Bylaws obligates Cal Dairies to accept all of the milk of its members “subject to the right of the Board, in its discretion, upon written notice to the membership . . . to allocate equitably among the members on a uniform basis . . . the quantity . . . of milk to be received by the Association.” Cal Dairies adopted a system that set a production quota based upon average daily production numbers for 2007. At the time the board adopted the supply management program, it knew (1) there were member dairies with declining production and allocating a base using an annual average would provide those dairies with a base in excess of their actual production and such excess base would be a saleable asset; (2) there were a number of member dairies, including plaintiff’s, with increasing production; and (3) the base allocation would not account properly for dairies with increasing production.
After attempting (and failing) to obtain relief directly from the board by showing that the quota system was causing him extreme hardship, plaintiff filed a lawsuit for breach of a written contract, breach of the covenant of good faith and fair dealing, and negligent misrepresentation.
After a bench trial, the trial court dismissed each of plaintiff’s claims except for the claim for breach of contract. The trial court analyzed the terms of the Bylaws and concluded that Cal Dairies breached its contractual obligation to implement a supply management program equitably, uniformly and based upon representative years of production. With respect to damages, the trial court determined that the correct measure of damages was the difference between the amount plaintiff received under the improper formula, and the amount he would have received under a proper uniform, equitable plan.
Cal Dairies appealed, arguing that the trial court erred by failing to apply the business judgment rule and give deference to its board of directors’ choice of terms for the production quota system. The Court of Appeal rejected Cal Dairies’ argument. As a preliminary matter, it held that Cal Dairies, as a nonprofit cooperative association, was a membership corporation without capital stock. Accordingly, any deference given to its board of directors would be derived from the business judgment rule. (Even if Cal Dairies had been an unincorporated association, it still would have benefited from an analogous “judicial deference” rule. Like the business judgment rule, the “judicial deference” rule insulates from court interference management decisions made by directors loyally, with due care and in their good faith belief that the decisions are in the organization’s best interests.)
The application of the business judgment rule to the facts of this case, however, was not straightforward. The board decision at issue — establishing the terms of the production quota system — was subject to the terms of the contract between plaintiff and Cal Dairies. Thus, the board’s decision implicated both its management responsibilities and Cal Dairies’ contractual obligation to perform as agreed with plaintiff and the other member dairies. Here, the contract granted discretion to the Cal Dairies board on a matter involving business operations, but also limited that discretion by requiring the board to allocate milk quantities equitably among members on a uniform basis. In a situation where a contract grants a board limited discretion, the Court concluded, the board’s decision will not be afforded deference under the business judgment rule until after the court properly determines that the action of the board falls with the discretionary range of action authorized by the contract. Here, the Court of Appeal affirmed the judgment on the breach of contract claim in favor of plaintiff.
Scheenstra stands for the proposition that the business judgment rule will not protect board decisions in contravention of specific contractual obligations. To benefit from the deference granted by the business judgment rule, a board of directors must act within its authority and pursuant to its obligations to its shareholders/members.
For further information, please contact John Stigi at (310) 228-3717 or Alejandro E. Moreno at (619) 338-6664.
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