The U.S.
Supreme Court will decide whether the Sarbanes-Oxley Act of 2002, enacted after
the collapse of Enron Corp., can literally be used for a fishing expedition.
The
justices yesterday weighed an appeal from a Florida commercial fisherman who
tried to avoid a citation for catching undersized red grouper by having the
fish tossed back into the ocean. What the fisherman, John Yates, received in
addition to the citation, was a conviction for violating Sarbanes-Oxley, which
prohibits the destruction of evidence. The law carries a maximum penalty of 20
years.
As
Bloomberg’s Greg Stohr reports, several justices were clearly incredulous,
questioning how the law -- intended to combat business fraud -- could cover a
minor offense.
“What kind
of a mad prosecutor would try to send this guy up for 20 years, or risk sending
him up for 20 years?” Justice Antonin Scalia asked during the one-hour argument
session in Washington.
The 2002
law criminalizes the destruction of “any record, document or tangible object”
for the purpose of thwarting a federal investigation or proceeding. The
question for the court is whether fish qualify under that definition.
Justice
Stephen Breyer said he worried the provision was so broadly worded it would
cover trivial matters such as tearing up a census form or kicking an ember from
an illegal campfire.
“You could multiply
those beyond belief,” he said.
The case is
Yates v. U.S., 13-7451.
Court
Scolds Lawyer Who Used Judge’s Friendship to Pitch Clients
The top
U.S. patent court reprimanded a Silicon Valley lawyer who touted his friendship
with the former chief judge to prospective clients.
Edward
Reines, who has represented Apple Inc. (AAPL), Microsoft Corp. (MSFT) and other
companies in patent disputes, engaged in misconduct when he forwarded a
complimentary e-mail in March from Chief Judge Randall Rader, the U.S. Court of
Appeals for the Federal Circuit said yesterday.
The order
marked a rare public chastising of a lawyer who practices before the court.
Rader said
in the private e-mail to Reines -- a partner in the Redwood City, California
office of Weil, Gotshal & Manges LLP -- that another judge had complimented
his appellate work and encouraged Reines to let others see the message, which
he signed “Your friend for life, rrr.”
Reines
forwarded the e-mail to “no fewer than 35 existing and prospective clients,
with accompanying comments soliciting their business based on the e-mail,”
according to the order.
The
attorney agreed that he shouldn’t have forwarded the e-mail but denied he used
it to imply he could wield improper influence.
Reines
didn’t reply to messages seeking comment on the reprimand. The firm in an
e-mail said it was reviewing the court’s order and had no further comment.
Rader, 65, stepped
down as chief judge in May and announced his immediate retirement a month
later. In a May 23 letter to the court’s other judges, Rader said he had
“engaged in conduct that crossed lines established for the purpose of
maintaining a judicial process whose integrity must remain beyond question.”
The case is
In Re Edward R. Reines, 14-MA004, U.S. Court of Appeals for the Federal Circuit
(Washington).
Singer’s
Hedge Fund Seeks to Keep Argentine Lawyer in U.S.
Billionaire
hedge fund manager Paul Singer’s NML Capital Ltd. filed an emergency request in
Washington federal court to keep Argentine lawyer Cesar Guido Forcieri in the
U.S. to answer questions about assets that might be available to pay off $1.7
billion in judgments against the South American country.
Forcieri, a
former World Bank director, has ignored demands to produce documents and be
questioned, NML’s lawyers said in court papers. NML asked a judge to force
Forcieri to turn over his passport and stay in the U.S.
Forcieri
has “imminent plans” to leave the country permanently on Nov. 8, the hedge fund
said.
NML has
been locked in a court fight with the South American nation over its refusal to
pay holders of its defaulted sovereign debt. The country hasn’t paid numerous
court judgments in favor of defaulted bondholders and has vowed never to pay
the hedge funds’ claims, calling the holders “vultures.”
NML’s
fruitless, decade-long quest to recoup its investments now has the fund
scouting for Argentine assets around the world.
Forcieri
couldn’t immediately be located for comment.
The
Washington case is NML Capital Ltd. v. Argentina, 14-mc-01237, U.S. District
Court for the District of Columbia (Washington). The New York case is NML
Capital Ltd. v. Republic of Argentina, 08-cv-06978, U.S. District Court,
Southern District of New York (Manhattan).
Law Firm
News
White &
Case Adds Two Partners to Its White-Collar Practice
Daniel
Fridman and Michael Garcia have joined the white-collar practice of White &
Case LLP as partners in its Miami office.
Fridman and
Garcia, who were both previously partners at Holland & Knight LLP, have
experience conducting internal investigations for clients doing business in
Latin America. They also advise clients on anti-corruption issues and on
government enforcement and compliance matters, including providing compliance
training in Spanish, the firm said in a statement.
Fridman
advises corporations and individuals for violations of U.S. laws including the
Foreign Corrupt Practices Act and the False Claims Act. He advises companies in
the health-care industry as well.
Garcia, who
has experience with the FCPA, accounting, financial reporting and related
disclosure matters, has led internal investigations arising from allegations of
potential misconduct in the U.S. and Latin America involving subsidiaries of
American and European businesses. He also has advised audit committees on
complex accounting and financial-reporting practices.
Sutherland
Asbill Adds Insurance and Financial-Services Partner
Dodie Kent
joined the insurance and financial-services practice of Sutherland Asbill &
Brennan LLP as a partner in New York.
Kent
previously was associate general counsel at AXA Equitable Life Insurance Co.,
where she was the company’s principal legal securities adviser on its variable
and fixed life and annuity product lines.
With more
than 20 years’ experience in financial services, Kent advises on product
design, marketing and administrative issues. She also counsels on related
regulatory compliance and enforcement issues.
Former IRS
Lawyer Canup Joins Hirschler Fleischer in Virginia
James Canup
joined Hirschler Fleischer as a Richmond, Virgina-based partner to chair the
firm’s tax practice.
Canup, most
recently a partner at Kaufman & Canoles PC, also worked in the chief
counsel’s office of the Internal Revenue Service.
He focuses
on pass-through entities such as LLCs and partnerships, real estate investment
trust, corporate transactions and tax-exempt organizations. He also advises
issuers and investment managers on qualified tuition programs.
(Published by Bloomberg – November 6, 2014)