Legal Briefing: Did the Big Banks Cheat Your Town?
A daily look at legal news and the business of law:
A Dozen Wall Street Firms Named Co-Conspirators in Municipal Bond Fraud Case
Back in October, the Department of Justice indicted CDR Financial Products and three of its executives in a bid-rigging case. The bid rigging allowed the big banks to pay cities and towns below-market interest rates on proceeds from municipal bond sales that were invested with them. When the DOJ sued, it didn't name the co-conspirators. However, a lawyer for one CDR defendant "inadvertently" included the names of all the alleged co-conspirators in a filing last week; according to Bloomberg, the dozen banks involved include: JPMorgan Chase (JPM), UBS (UBS), Society Generale, Wachovia, and the former Salomon Smith Barney, Bear Stearns, and Lehman Brothers Holding. So far, three lower-level executives have pleaded guilty in the case -- two just this month -- and are cooperating with the government. This cooperation should be making the indicted executives and their co-conspirators rather nervous.
These banks have another, related problem: an antitrust suit from defrauded towns and cities. According to Am Law Litigation Daily, on Thursday, a judge refused to dismiss the lawsuit. Indeed, since that suit names fifteen bank defendants, maybe last week's "inadvertent" filing was incomplete. While the article doesn't name all 15 defendants, the list includes JPMorgan, Morgan Stanley, Wells Fargo (WFC), and UBS.
Plaintiffs' Attorneys Jockey for Lead Role in Toyota Litigation
Two dozen attorneys crowded a courtroom Thursday, each seeking to become lead plaintiffs' counsel by having all the Toyota (TM) cases consolidated in a courtroom near them, reports The Wall Street Journal. A total of 19 different locations, including California, Louisiana, Kentucky, Ohio, Minnesota, Florida, South Carolina, West Virginia, and New Jersey, were on the table. At stake are the hefty legal fees and prestige available to the lead plaintiffs' counsel, who does most of the work and thus gets most of the reward. The judges on the panel which will decide, in two to six weeks, where the cases will be heard, allowed the attorneys two minutes each to make the case for their preferred locations. Despite all the attorneys present, the Journal anditsLaw Blog described the fight as essentially between three Marks: W. Mark Lanier from the Vioxx cases; Mark P. Robinson Jr. from the Ford Pinto cases; and Mark J. Geragos of Michael Jackson fame.
New York Has a New Securities Fraud Cop
The Southern District of New York has a new head of its Securities Fraud Unit: Christopher Garcia, won the Refco cases, including the one against its outside counsel.
And in the Business of Law:
• Duane Morris saw its revenues and profits increase, while revenue per lawyer was essentially flat, reflecting the big increase in headcount at the firm, reports the Legal Intelligencer.
• New Jersey Lobbyists had a big year, too, as detailed by the New Jersey Law Journal. The lobbyists explain their good fortune as being directly related to New Jersey's budget crisis: Businesses want to be sure that they effectively speak up for their slice of the shrinking pie.