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Winston & Strawn Settles Claim with GE Rainmaker
Law Firm News |
2007/11/21 09:15
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Winston & Strawn has settled on the eve of trial a lawsuit brought against it by a New York partner who claimed the firm broke a deal to exempt him from "decompression," a policy sharply reducing partners' pay after age 65, writes the New York Law Journal.
Throughout the 1990s, Anthony LoFrisco, 74, was one of the law firm's highest-paid partners, based largely on his close relationship with former General Electric (GE) chairman John "Jack" Welch. According to a 1994 agreement with Chicago-based Winston, LoFrisco was to be paid an amount equal to at least 13% of the firm's GE billings.
That arrangement expired in 2001 but LoFrisco claimed in his 2003 lawsuit that the firm agreed that year to extend the deal and exempt him from decompression. He accused the firm of reneging the following year, with decompression reducing his pay from $2.3m (£1.1m) in 2002 to $350,000 (£170,000) in 2004.
Trial in the matter was scheduled to begin Monday before Manhattan Supreme Court Justice Helen Freedman. But the parties said in a joint statement yesterday (20 November) that they reached an “amicable settlement” of the dispute on 10 November. The terms of the settlement are confidential.
As a result of the settlement, the parties stated: "LoFrisco's lawsuit will be dismissed and he will resign from the firm on 26 November, 2007."
Both Winston's lawyer, Philip Forlenza of Patterson Belknap Webb & Tyler, and LoFrisco's lawyer, Elkan Abramowitz of Morvillo Abramowitz Grand Iason Anello & Bohrer, declined to comment further.
The settlement ends an unusual suit that had drawn much attention to the issue of how firms handle aging rainmakers, many more of whom are now challenging firm policies that envision retirement at age 65 or earlier. In recent years, many firms have shown greater willingness to waive decompression, mandatory retirement or similar policies for older partners still responsible for large amounts of business.
The sensitive issue of how to manage aging partnerships was thrust into the spotlight last month after Sidley Austin agree to pay $27.5m (£13.1m) to settle an age discrimination claim with 32-former partners who were forced to give up equity partner status in 1999. |
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CPDC President Pleads Guilty to Obstruction of Audit
Court Watch |
2007/11/19 11:43
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The president of the Los Angeles-based Community Partnership Development Corporation (CPDC) pleaded guilty this morning to charges of obstructing an audit conducted by the United States Department of Housing and Urban Development, which was looking into the expenditure of nearly $3.2 million of federal money on "engineering and construction management supervision fees."
Frank DeSantis, 49, of Santa Clarita, pleaded guilty to the felony obstruction charge before United States District Judge John F. Walter. DeSantis pleaded guilty to a one-count indictment that was returned by a federal grand jury in June and accused him of overstating work hours in relation to grant money that HUD had provided to the CPDC.
HUD provides funding, through the Low-Income Housing Preservation and Resident Homeownership Act of 1991 -- commonly called the Preservation Program -- to support the development and operation of privately owned rental properties for low-income families. The Preservation Program provides financial assistance in the form of grants to private owners for the purchase and rehabilitation of properties. In 1996 and 1997, DeSantis received Preservation Program grants, which he used to purchase three properties -- the New Brittany Housing Foundation Development, the L.A. Garden Community Association Development, and the Casa Community Association Development. In June 2002, HUD’s Office of Inspector General conducted an audit of the grant fund expenditures for the three developments. In order to explain the expenditure of $3,198,245, DeSantis submitted time sheets for CPDC employees. However, the time sheets proved to be false for three reasons: they were created long after the purported work took place, they showed more hours than the employees actually worked on the Preservation Program grant, and the time sheets failed to disclose that a significant number of hours were spent working on non-Preservation Program projects.
“Financial crimes aimed at multifamily housing undermine the economic viability of what is home to dozens and sometimes hundreds of families,” said Kenneth M Donohue, Inspector General for the U.S. Department of Housing and Urban Development. “To the extent that we can stop these destructive practices, the HUD Office of Inspector General will be a deterrent to these pernicious activities and a defender of the notion that people should be able to enjoy a safe and affordable home.”
DeSantis is scheduled to be sentenced by Judge Walter on February 4. At that time, DeSantis faces a statutory maximum penalty of five years in federal prison. As part of his plea agreement, DeSantis has agreed to pay $400,000 to reimburse HUD for some of the money provided in Preservation Program grants.
This case is the result of an investigation by HUD's Office of Inspector General. |
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Health Care Co. Owner Sentenced to 66 Months
Health Care |
2007/11/19 10:59
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The owner and operator of a Florida health care company has been sentenced to 66 months incarceration for Medicare fraud, Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced today.
Marianela Smith was sentenced on Friday, Nov. 9, 2007, by U.S. District Court Judge Joan A. Lenard at the federal court in Miami. Judge Lenard also ordered Smith to pay approximately $363,000 in restitution for submitting approximately $800,000 worth of fraudulent claims to the Medicare program.
Smith owned and operated Smith Medical Equipment, a Miami medical equipment company, from approximately 2000-2003. She was convicted on five charges following a seven-day trial in August 2007. At trial, the government established that Smith had been paying kickbacks to Medicare beneficiaries throughout Miami-Dade County to gain access to their Medicare information. After gaining access to their Medicare cards, Smith billed Medicare for unnecessary services on behalf of these patients, including oxygen concentrators and nebulizers. One of these patients testified that Smith paid him in cash and that he did not need the treatments or medication that Smith was billing to Medicare. Further, he testified that he threw away the medication that was paid for by Medicare. According to trial testimony, Smith paid $150 per month if the patients agreed to accept unneeded aerosol medications, such as Albuterol, and related respiratory equipment such as oxygen concentrators.
Smith obtained the compounded aerosol medications from previously convicted pharmacy owners in Miami. From 2000 to 2003, these pharmacies billed the Medicare program for over $17 million.
The case was prosecuted by Assistant Chief John Kelly and Trial Attorney Hank Bond Walther from the Fraud Section of the U.S. Department of Justice in Washington, D.C., with the investigative assistance of the U.S. Department of Health and Human Services, Office of the Inspector General; the FBI; and the Medicaid Fraud Control Unit from the State of Florida. This case was brought as part of the Medicare Fraud Strike Force initiative created in March 2007, led by the Fraud Section in Washington, D.C., and the U.S. Attorney’s Office in the Southern District of Florida. The Strike Force operates out of the federal Health Care Fraud Facility in Miramar, Florida, and has brought over 74 cases involving 120 defendants since March 1, 2007.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls . Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on . |
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Freshfields Bruckhaus Advises HP in Acquisition
Mergers & Acquisitions |
2007/11/19 10:21
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Leading international law firm Freshfields Bruckhaus Deringer has advised HP on its acquisition of Atos Origin Middle East group, ('AOME'), one of the Middle East's leading systems integrators, to broaden its consulting and integration capacity in the region. The transaction closed on Monday 5 November.
The acquisition is expected to deliver three key strategic assets to HP: enhancement of the company’s SAP capabilities in the Middle East; reinforcement of HP’s expertise in two key market segments – the public sector and oil and gas; and the extension of HP’s geographic presence into Libya and Qatar.
Bruce Embley, the corporate partner in Dubai who led the team said, 'We are delighted to have assisted HP on this important acquisition in the Middle East.'
The Freshfields team included associates Jan Hards, Zoe Blakemore and Fares Al-Hejailan. HP's internal legal team on the deal was led by Sergio Letelier. |
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United Rentals Takes Cerberus to Court
Court Watch |
2007/11/19 10:08
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United Rentals filed a lawsuit against Cerberus Capital Management seeking to force the private-equity firm to follow through with its buyout of the rental-equipment company.
The suit comes after Cerberus said last week that it wanted to pay a $100 million break-up fee to end the deal, partly because of volatility in the credit markets. United Rentals has contended that there are no financing obstacles to the $7 billion buyout, nor any significant changes in its business.
United Rentals said Monday that RAM Holdings and RAM Acquisition, two acquisition vehicles formed by Cerberus, are violating the merger agreement and do not have the right to simply pay the break-fee and walk away from the deal.
The company called Cerberus' action a "naked ploy" to extract a lower price for the buyout. Cerberus said last week it was willing to negotiate a revised deal.
Through the lawsuit, filed in the Delaware Court of Chancery, United Rentals is seeking to consummate the merger agreement in accordance with its original terms.
With the suit, United Rentals joins Sallie Mae in launching a legal battle with its potential acquirers to force a buyout. Other companies, such as Harman and Acxiom, have seen their deals fall apart as turmoil in the credit markets affects private-equity firms' ability to raise financing.
Shares of United Rentals recently were down 37 cents, or 1.6%, to $23. The buyout had called for Cerberus to pay $34.50 a share for the company. |
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Maryland Police/Sheriff Investigate Taser Death
Breaking Legal News |
2007/11/19 09:43
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Frederick law enforcement agencies are conducting dual investigations into the death of a 20-year-old man who died Sunday after a Frederick County Sheriff’s deputy used a Taser to subdue him.
According Cpl. Jennifer Bailey, spokeswoman for the Sheriff’s Office, a deputy responded to the 7000 block of Gresham Court East, Frederick, at 4:54 a.m. Sunday for the report of a fight in progress.
The deputy — whose identity has not been released — found four people fighting, and deployed a Taser, striking Jarrel Gray of Frederick.
Gray fell to the ground, and he received medical attention. He was transported to Frederick Memorial Hospital, where he was later pronounced dead.
The deputy who fired the Taser has been placed on administrative leave with pay during the investigation, which is normal procedure.
On WFMD Monday morning, Sheriff Chuck Jenkins (R) said two investigations are under way: The Frederick Police Department is investigating Gray’s death, while the Sheriff’s Office is investigating the use of the Taser by one of its deputies.
According to Frederick County Circuit Court records, Gray was serving two years and six months of supervised probation stemming from charges of second-degree assault and resisting arrest in November 2006.
This incident comes almost two weeks after a Frederick County Sheriff’s deputy used a Taser in his role as a school resource officer at Tuscarora High School.
In that incident, an 18-year-old student was not injured as he resisted a deputy’s command to step away as he broke up a fight at the school. |
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Texas Judge Issues Injunction Against Tribe
Breaking Legal News |
2007/11/19 09:40
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A Texas judge grants a permanent injunction against the Wichita-based Kaweah Indian Nation and its self-proclaimed chief, Malcomb Webber.
The unrecognized tribe is accused of defrauding illegal immigrants by falsely claiming they could get Social Security numbers if they bought tribal memberships.
The Texas attorney general's office had filed a lawsuit accusing Webber and his group of violating the Texas Deceptive Trade Practices Act.
The lawsuit is still pending against two other defendants. And a spokesman for the Texas attorney general's office said a ruling on any penalties and restitution will be made after the entire case is settled.
A court-appointed attorney for Webber has said Webber was a victim of renegade underlings. |
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Class action or a representative action is a form of lawsuit in which a large group of people collectively bring a claim to court and/or in which a class of defendants is being sued. This form of collective lawsuit originated in the United States and is still predominantly a U.S. phenomenon, at least the U.S. variant of it. In the United States federal courts, class actions are governed by Federal Rules of Civil Procedure Rule. Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions. Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions. They can construct your law firm a brand new website and help you redesign your existing law firm site to secure your place in the internet. |
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