Catagory:Market Announcements

From the New York Times:

By GRETCHEN MORGENSON
Published: December 20, 2006

"The NASD, the nation’s largest self-regulatory organization for the securities industry, accused Morgan Stanley yesterday of routinely failing to provide e-mail messages to aggrieved customers who had filed arbitration cases against the firm over three and a half years and with making false claims that millions of e-mail messages in its possession had been lost in the Sept. 11 attack on the World Trade Center.

The regulator also contended in its complaint against Morgan Stanley that the firm regularly destroyed millions of e-mail messages by overwriting its backup tapes and by allowing employees to delete messages. Securities and Exchange Commission rules require that firms keep all e-mails and business communications for three years. "

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Kirkpatrick & Lockhart Nicholson Graham LLP and Preston Gates & Ellis LLP Announce Combination Effective January 1, 2007

NEW YORK AND SEATTLE — Kirkpatrick & Lockhart Nicholson Graham LLP (K&LNG) and Preston Gates & Ellis LLP (PG&E) today announced that their partners have voted overwhelmingly in favor of a proposed combination of the two firms effective January 1, 2007. The name of the combined firm will be Kirkpatrick & Lockhart Preston Gates Ellis LLP, and the firm will be branded as "K&L Gates." K&L Gates will comprise approximately 1,400 lawyers and 21 offices located in North America, Europe and Asia. The combination will rank as one of the most substantial in the history of the legal profession, and it will create one of the world’s largest law firms. The firm will be expected to have revenue exceeding US$750 Million in 2007, its first full year of existence.

Click here to view the press release.

From the U.S. DOJ website: U.S. Deputy Attorney General Paul J. McNulty announced today during a speech at a meeting of the Lawyers for Civil Justice in New York that the Department of Justice is revising its corporate charging guidelines for federal prosecutors throughout the country.

The new guidance revises the Thompson Memorandum, which was issued in January 2003 by then-Deputy Attorney General Larry D. Thompson and titled the “Principles of Federal Prosecution of Business Organizations.” The memo provides useful guidance to prosecutors in the field through nine factors to use when deciding whether to charge a corporation with criminal offenses.
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The Associated Press recently turned to partner Martha Dawson as a source on new electronic discovery rules. The article, “Companies Face New Rules on Keeping Data,” appeared in national publications from The New York Times and The Wall Street Journal to other regional and online publications.

The new rules require that lawyers meet much earlier in the discovery process to discuss where the client’s data is stored and how accessible it is. This provision emphasizes the importance of being prepared ahead of time. Writes the AP reporter:

But Martha Dawson, a partner at the Seattle-based law firm of Preston Gates & Ellis LLP who specializes in electronic discovery, said companies will not have to alter how they retain their electronic documents. Rather, she said, they will have to do an “inventory of their IT system” in order to know better where the documents are. The new rules also provide better guidance on how electronic evidence is to be handled in federal litigation, including guidelines on how companies can seek exemptions from providing data that isn’t “reasonably accessible,” she said. This could actually reduce the burden of electronic discovery, she said.

In its October Meeting, the Washington Bar Association Court Rules and Procedures Committee appointed Preston Gates partner Todd L. Nunn as Chairman of the Electronically Stored Information Discovery Subcommittee. The mandate of the subcommittee is to consider whether amendments to Washington’s Civil Rules are needed to handle the specific challenges of the discovery of electronically stored information.  In his practice, Todd advises clients on electronic discovery matters and discovery response planning as a part of the firm’s Document Analysis Technology Group.

The amendments to the Federal Rules of Civil Procedure concerning the discovery of “electronically stored information” go into effect today. The package includes revisions and additions to Rules 16, 26, 33, 34, 37, and 45, as well as Form 35. The complete set of e-discovery amendments, with the accompanying Advisory Committee notes, is available here. Material regarding the amendments may be accessed on the U.S. Court’s Federal Rulemaking website at: http://www.uscourts.gov/rules/congress0406.html. Read More

Preston Gates partner Helen Bergman Moure was quoted in today’s Wall Street Journal in an article titled: New Rules Are Set for Federal Courts On Electronic Data.

"The changes "may serve as a wake-up call for some companies that haven’t been in a case where electronic [evidence] has been produced," says Helen Bergman Moure, an attorney in the document analysis technology group at Seattle law firm Preston Gates & Ellis LLP. The rules govern only federal cases and leave penalty decisions to judges."

The article appears on page B3 of the print edition or in electronic format here [subscription required.]

A November 2006 article by Preston Gates partner Julie Anne Halter for the Washington Legal Foundation:

"The proposed amendments to the Federal Rules of Civil Procedure will go into  effect on December 1, 2006, absent some affirmative act by Congress to prevent their  adoption. Among the amendments are provisions designed to address the everapparent  problem faced by corporate litigants: the volume of electronically stored  information and the varying ways it is maintained make it very difficult and often  cost-prohibitive to efficiently and effectively review it for privileged material prior to production. Under the current legal framework, the inadvertent production of  privileged or work-product protected material creates substantial risk; at the same  time, the effort and cost to conduct a comprehensive pre-production privilege review  often make such review impractical."

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The Supreme Court on Monday refused to consider a case in which Qwest Communications International Inc. had been ordered to produce 220,000 pages of documents to shareholders in a civil securities fraud lawsuit.

Qwest attorneys had argued the documents were protected by attorney-client and work-product privilege.

Many shareholders involved in the lawsuit reached a $450 million class action settlement with Qwest, but claims are pending against former Chief Executive Officer Joseph Nacchio and former Chief Financial Officer Robert Woodruff.

The 10th U.S. Circuit Court of Appeals upheld a lower court’s decision that the company waived its privilege when it gave the documents to the Securities and Exchange Commission and Justice Department.

The shareholders sued the company in 2001, about a year before the Securities and Exchange Commission and the Justice Department opened separate investigations into accounting improprieties that eventually led Qwest to remove billions of dollars in improperly reported revenue from its books.

Based in Denver, Qwest is the primary phone service provider in 14 mostly Western states.

The case is Qwest Communications International Inc. v. New England Health Care Employees Pension Fund, 06-343.

From the November issue of the New Jersey Law Journal: "A Morristown, N.J., law firm will have to turn over client e-mails in a federal court battle between a former client and his ex-employer, as a judge has rejected the firm’s assertions of privilege.

The messages were exchanged among Riker Danzig Scherer Hyland & Perretti, its former client, Warren Tobin of New Zealand, and Matthew Young, a "lay adviser" to Tobin in a related New Zealand proceeding.

Tobin and Young are defendants in Stayinfront Inc. v. Tobin, 05-Civ.-4563, in which U.S. District Judge Stanley Chesler held on Nov. 3 that there was no attorney-client privilege protection for the e-mails because the privilege had been waived by sharing the messages with Young.

Work-product privilege was also unavailable. Chesler found the defendants’ "recalcitrance, willful noncompliance and disregard for the rules and authority of this Court" constituted exceptional circumstances that justified piercing the privilege to compel production."

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