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Wake Up Call: Madoff Fees Approach $1 Billion for Baker & Hostetler

Sept. 8, 2017, 12:24 PM

• Since Baker & Hostetler partner Irving Picard was appointed trustee of funds recovered for victims of Bernard Madoff’s giant Ponzi scheme about a decade ago, the firm has racked up Madoff-related fees of about $925 million, a nice boost to its finances. ( Bloomberg ) ( Am Law Daily )

• Equifax Inc. revealed that its systems were hit by a cyberattack that may have affected about 143 million U.S. customers of the credit reporting agency, in one of the largest and most intrusive breaches in history. ( Bloomberg ) According to Equifax, three senior executives did not yet know about the breach when they sold shares worth almost $1.8 million in the days after the company discovered it. ( Bloomberg ) The company took over month to notify consumers that thieves may have their personal data. That casts light on the lack of a U.S. law to require breach notification in such cases. ( TechCrunch )

• LexShares, an online platform that allows investors to finance lawsuits, said it will start offering clients litigation finance on a portfolio basis — whereas in the past, it only offered investors the ability to fund single cases at a time. The start-up’s announcement is the latest sign of a shifting market for outside investment in lawsuits. ( BLB )

• Cooley LLP said it is adding three partners from Wilson Sonsini Goodrich & Rosati PC to strengthen its core corporate practice in the San Francisco Bay area. The hires of emerging-growth specialists Jon Avina, Calise Cheng, and Rachel Proffitt fit into Cooley’s aim to be the go-to firm for technology and life sciences companies, said its CEO, Joe Conroy. ( BLB )

• Trump’s pick for U.S. attorney for the Eastern District of North Carolina, Robert J. Higdon Jr., is a white-collar partner at law firm Williams Mullen. If confirmed, Higdon could, technically at least, end up with the power to fire Mueller. But that’s assuming a bunch of other people above him at the Justice Department quit first. ( Newsweek )

• Wal-Mart’s former head of eDiscovery, Aaron Crews, told BLB he left to join “a little AI startup” called TextIQ because, with soaring data volumes pushing up eDiscovery costs, he’s betting TextIQ has the best new technology for sorting through the “garbage” to find companies’ important information. ( BLB )

Law Firm Business

• Joshua Briones has been a migrant farm worker, day laborer and busboy among other things, and he never graduated high school. Now, he’s managing partner at Mintz Levin Cohn Ferris Glovsky and Popeo’s L.A. office, and has served as lead defense counsel on 200-plus class actions. ( Litigation Daily )

• Pittsburgh is on a roll for lateral hiring and growth by out-of-town firms, with Porter Wright Morris & Arthur, Spilman Thomas & Battle and Cozen O’Connor either entering or expanding in the city recently. ( Legal Intelligencer )

• Hogan Lovells said its partnership gave a vote of confidence to CEO Steve Immelt and Deputy CEO David Hudd, extending their terms by another two years, through June 30, 2020. ( BLB )

Legal Market

• AbbVie’s treatment for inflammatory diseases, Humira, is the world’s best-selling drug, with $16 billion in annual sales. To protect it, the company has put up a shield of over 100 patents. ( Bloomberg Businessweek )

• As Waymo and Uber head for a self-driving car crash in court, both companies have a lot to lose. ( Bloomberg Businessweek )

Regulators and Enforcement

• Education Secretary Betsy DeVos announced plans to scrap Obama-era rules for the way colleges and universities handle allegations of sexual assault on campus. ( Associated Press via Bloomberg )

• As increasing numbers of campus sexual assault victims have come forward in recent years, more lawyers are specializing in defending people accused of campus sexual assault or misconduct. ( Boston Globe )

• Federal prosecutors want former pharmaceutical executive Martin Shkreli, a convicted felon awaiting sentencing, locked up immediately after he posted a $5,000 bounty on Facebook for someone to “grab” hair from former Secretary of State Hillary Clinton. ( Bloomberg )

• The SEC accused two men of paying an Amazon analyst $10,000 for nonpublic information on the online retailer’s 2015 first-quarter earnings and then using the information to make trades. ( Bloomberg )

• New York’s banking regulator ordered Habib Bank Ltd. to pay $225 million and surrender its license to operate in the state, effectively removing Pakistan’s largest lender from the U.S. financial system. ( Bloomberg )

The Trump Administration

• Donald Trump Jr. was in a five-hour, closed-door meeting Thursday with staff of the Senate Judiciary Committee to discuss details of his meeting with several Russians during the presidential campaign. ( Bloomberg )

• Special counsel Robert Mueller is said to be honing in on President Donald Trump’s possible involvement with his son’s meeting with the Russians. ( Business Insider )

• King & Spalding partner Bobby Burchfield, independent ethics counsel for the Trump Organization, got some unwelcome publicity when his wife was arrested in Virginia after allegedly having sex with a prison “inmate/trustee” in the backseat of a car and providing him with “unauthorized articles,” according to a criminal complaint. ( Fauquier Times )

• Former Hogan Lovells partner Ty Cobb, now on Trump’s legal defense team, got suckered into a bizarre email exchange with a known troll, using his official White House account. ( Above The Law )

Happening in SCOTUS and Other Courts

• President Donald Trump suffered another setback on his embattled travel ban, with an appeals panel leaving in a place a lower-court ruling that forces the administration to accept people with grandparents, cousins and other relatives in the U.S. ( Bloomberg )

• The Trump administration took a side in one of the most hotly contested cases facing the U.S. Supreme Court in its upcoming term, calling on the court to let bakers and potentially other wedding vendors to refuse on free-speech grounds to provide services for same-sex ceremonies. ( Bloomberg )

• On the first day of the federal corruption trial of U.S. Senator Robert Menendez, the judge tore into prosecutors for what he called a “tabloid” start to their case. ( Bloomberg )

• A judge has lifted a restraining order clearing the way for Dallas to remove a statue of Confederate General Robert E. Lee. ( AP via Bloomberg )

Laterals, Moves, Law Firm Work

• Dallas-based Haynes and Boone, LLP, said prominent Texas appellate lawyer Mike Hatchell has joined the firm’s appellate practice as counsel in its Austin office. Hatchell comes over from Locke Lord LLP, where he led the firm’s appellate practice group. ( HaynesBoone )

• Winston & Strawn LLP said it expanded its derivatives and structured products practice in New York with two new hires. John Servidio, coming from McGuireWoods LLP, joins as a partner, while Daniel Bley, coming from Cadwalader, Wickersham & Taft LLP, joins as an associate. ( Winston )

• Sidley Austin hired former federal prosecutor Jean-Claude “J.C.” André as a partner in its U.S. Supreme Court and appellate practice, in its latest lateral hire to expand its presence in Los Angeles. ( The Recorder )

• A former Western Union general counsel and executive, John Dye, has taken a job as GC at Upgrade, Inc., a recently launched consumer credit platform. ( Business Wire )


• Technology companies’ vociferous support for the children of undocumented immigrants could set the industry up for its biggest showdown yet with Trump and Republicans in Congress. ( Bloomberg )

• The U.S. government is said to be planning to seize more assets from Chinese companies that it says laundered money for North Korea, using information uncovered in its investigation of the Chinese mobile-phone maker ZTE Corp. ( Bloomberg )

• As Hurricane Irma bears down on Florida, Google Maps will indicate closed roads in real time. ( Recode )

• Inc. is dealing with complaints over merchants’ price-gouging on bottled water after back-to-back catastrophic hurricanes afflicting Florida and Texas. ( Bloomberg )


• A Las Vegas estate attorney pleaded guilty in a Nevada district court to stealing more than $16 million from clients. ( Las Vegas Review-Journal )

Compiled by Rick Mitchell and edited by Casey Sullivan.