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Newspaper sues state Supreme Court
Lawyer Blog News | 2007/06/13 12:27

A small Kane County newspaper and its former columnist have accused the biggest names in the state judiciary of violating Illinois citizens' basic constitutional rights.

In the process, the state court system returns to uncharted waters.

The Shaw Suburban Media Group, which runs the Kane County Chronicle, is suing seven Illinois Supreme Court justices, three Illinois appellate court justices and the Cook County circuit court judge who presided over a defamation trial against the newspaper.

It is the latest fallout from the lawsuit Illinois Supreme Court Chief Justice Robert Thomas won against the paper and its former columnist, St. Charles resident Bill Page.

"They filed a frivolous lawsuit in federal court and they should be sanctioned for that," said Chicago attorney Joseph Power, who represents Thomas. "It is absurd."

Thomas, of Wheaton, filed a defamation lawsuit against the newspaper and Page for three columns Page wrote in 2003. The columns accused Thomas of abusing his power to gain support for a friend running for a Kane County judgeship. Page claimed Thomas would agree to reduced punishment for then-Kane County State's Attorney Meg Gorecki - who was facing ethics violations - in exchange for support of his candidate.

Last Nov. 15 a Kane County jury sided with Thomas after a nearly three-week trial.

The federal lawsuit filed Tuesday seeks to have the libel verdict and $4 million judgment, reduced by the trial judge from the $7 million the jury granted, against the paper thrown out. The lawsuit also asks for a ban to be instituted on filing a new lawsuit against the paper while Thomas and the justices remain employed in the state court system.

The lawsuit also asks for attorney fees, an unspecified amount of damages and a stay on the 9 percent daily interest accruing on the judgment while the newspaper appeals.

Essentially, the lawsuit contends the newspaper can not receive a fair appeal of the case because the appellate court judges are under the control of Thomas. Also, unlike other cases, the newspaper cannot appeal for a hearing before the Illinois Supreme Court because five of the current seven justices were witnesses in the case and must recuse themselves, leaving less than the quorum required by law to hear a case.

"In a broader sense, the complaint is precedent-setting because this suit is the first in the nation to challenge the fairness of a personal lawsuit brought by a judge controlling a state court system," wrote Washington, D.C.-based attorney Bruce Sanford. He frequently represents media interests and filed the lawsuit on behalf of the newspaper and Page.

Sanford said the judgment cannot be enforced because it violates the civil rights of the newspaper.

Power said the newspaper had an opportunity to file a request to have Cook County Judge Donald O'Brien, a former defense attorney, removed as the trial judge in the case and did not. It was originally at the newspaper's behest the Supreme Court justices recused themselves.

"You can't have it both ways," Power said.

Sanford contends neither the federal courts nor a state-appointed panel of judges can fix the constitutional problems by hearing the case. The state lacks a procedure for this type of situation, because a similar case has never arisen.

"We have filed this lawsuit with great reluctance as we hoped the state court system would be able to protect our rights. That plainly is not the case," said Thomas Shaw, president of Shaw Suburban Media Group.

The lawsuit questions Thomas' ethical right to file the lawsuit in the first place because justices are expected to put the avoidance of the appearance of judicial impropriety above their personal gain.

Power said Thomas has as much a right to protect his reputation and a trial by jury as anyone else.

Once the defamation case hit the court, the lawsuit contends the newspaper and Page's due process, equal protection and First Amendment rights were violated by allowing justices to refrain from commenting on their deliberations in the Gorecki case because of judicial privilege and having Illinois judges hear a case with their boss, Thomas, as the plaintiff.

The trial judge and subsequent appellate court judges were all selected by the Supreme Court, five of whom are involved in the case, Sanford contended in a news release.

"One cannot doubt the obvious unfairness inherent in asking the inferior judicial officers appointed to this appeal to sit in judgment over a $4 million award to their Chief Justice and to evaluate the testimony of both the Chief Justice and his fellow Justices - their judicial bosses ...," Sanford wrote.

"I have never seen anything like it before. A Chief Justice enlists his colleagues on the bench as his witnesses to help him win a huge trial verdict and then expects the newspaper to be satisfied with its right to appeal within the court system he controls."



Gibson Dunn Named Best Corporate Firm in LA
Law Firm News | 2007/06/12 18:14

Corporate Board Member magazine ranked Gibson Dunn & Crutcher LLP as the best corporate law firm in Los Angeles and ninth nationally in its seventh annual survey of general counsels.  In a separate survey, the firm ranked seventh by directors for law firms they would most want representing their companies on national matters.

Approximately 800 directors and over 200 general counsels of publicly traded companies were surveyed to identify the top 20 firms nationally and the top five firms in 25 major U.S. cities. The rankings are included in the July/August issue of the magazine in the "America's Best Corporate Lawyers" feature and is available at http://www.boardmember.com/issues/current.


http://www.gibsondunn.com



Pepper Hamilton Expands New York Office
Law Firm News | 2007/06/12 18:00






Pepper Hamilton LLP announced that it has expanded its New York office with the addition of Joseph F. Voyticky as of counsel in the Financial Services Practice Group. Mr. Voyticky represents hedge funds, investment banks and commercial banks in a variety of structured finance and capital market transactions.

"Joe has a great deal of experience working with hedge funds that make secured asset-based loans," said Richard P. Eckman, chairman of Pepper's Financial Services Practice Group. "He also is experienced in collateral debt offering transactions, a growing part of our practice, as well as aircraft financings, and the drafting and review of liquidity facilities. He is a terrific addition to our hedge fund and finance practices, and we are delighted to welcome him to the firm."

Mr. Voyticky joins Pepper from the New York office of Allen & Overy LLP, where he was a senior associate concentrating on structured finance, global loans and leveraged finance. His practice also includes working on unsecured credit facilities, receivables purchases and sales, synthetic leases, leveraged leases and restructuring transactions.

"Pepper has a sophisticated finance and hedge fund practice, and I am excited by the prospect of helping it grow in New York and nationally," said Mr. Voyticky. "I look forward to building my practice while being a resource to existing firm clients on finance matters."

Mr. Voyticky is a graduate of Union College (B.A. 1989) and Harvard Law School (J.D. 1992).

About Pepper Hamilton

Pepper Hamilton LLP (www.pepperlaw.com) is a multi-practice law firm with more than 450 lawyers in seven states and the District of Columbia. The firm provides corporate, litigation and regulatory legal services to leading businesses, governmental entities, nonprofit organizations and individuals throughout the nation and the world. The firm was founded in 1890.

Pepper expanded its New York office and moved to a new address in Manhattan in October 2006. In addition to assisting clients in the financial services industry, lawyers in the New York office handle corporate matters, private equity, commercial and pharmaceutical litigation, international transactions and dispute resolution, employee benefits and executive compensation, and corporate restructuring and bankruptcy.

Pepper's Financial Services Practice Group includes more than 45 lawyers focusing on issues affecting the financial services industry.



Attorney's Wife Indicted on Criminal Charges
Lawyer Blog News | 2007/06/12 17:54
 A year after her former employer accused her of embezzling funds from her late husband's New Hampshire law firm, Deborah Woods, 52, of Stratham has been indicted on criminal charges in the case.

The Rockingham Country Grand Jury indicted Woods this past Wednesday on five felony counts relating to charges she stole from her late husband’s law firm, Gage & Woods PLLC of Exeter. Stephen Woods, a partner in the firm, disappeared at sea in October 2005.

Woods was employed as a bookkeeper at Gage & Woods between January 2004 and June 2006.

She is indicted on three counts of theft, one count of forgery and one count of fraudulent use of a credit card, all Class A felonies except for the forgery charge which is Class B, according to Assistant Attorney General John M. Gasaway Jr., who is prosecuting the case.

An indictment is not an indication of guilt. It means the grand jury found enough evidence to warrant a trial.

Each Class A felony charge carries a maximum penalty of 15 years in prison

The indictments allege that between January 2004 and last June, Woods stole from an estate fund, forged signatures and used a debit card from the Gage & Woods firm for personal expenses. A check for $109,389.24 is the subject of one theft and the forgery charge, Gasaway said.

Thomas Gage sued Woods last year and attached her property, including her home at 55 Bunker Hill Ave., claiming she stole more than $100,000.


Ed. Dept. Questioned over Funding Sources
Lawyer Blog News | 2007/06/12 17:19

Attorneys for the state Department of Education have filed a motion for a new trial to overturn a $7.6 million judgment in a whistle-blower case, despite unanswered questions from a state assemblyman who wants to know where the department is getting the money for its six-year legal battle.
Documents obtained previously by The Associated Press show the department has set aside nearly $4 million to pay private attorneys in a series of cases related to misappropriation of federal money and the related whistle-blower case against former Superintendent of Public Instruction Delaine Eastin.

The ballooning legal costs prompted Assemblyman Michael Duvall, R-Yorba Linda, to request information from the department about who is authorizing the case to continue and from what budget the money is being drawn.

The one-page memo he received in response stated the lawsuit is being paid out of "state general funds appropriated by the Legislature for support of the department." Duvall said it did not address any of his questions and has asked for more details from the Department of Finance and the state controller.

Documents given to Duvall in response this week show hundreds of thousands of dollars in legal payments but do not provide all the answers he was seeking. The AP obtained the documents separately from the controller's office.

They show the Department of Education used hundreds of thousands of dollars from other budgets under its authority, such as specialized after-school programs for at-risk youth.

Hilary McLean, a spokeswoman for schools superintendent Jack O'Connell, said the department spent about $1 million from July 1, 2002, to April 30, 2007, on the case against former department staffer James Lindberg.

The former compliance monitor sued the department, Eastin and department manager Joan Polster in 2001. He claimed to have discovered that millions of dollars in federal money had gone to nonexistent or fraudulent community groups from 1995 to 2000.

He claimed Eastin ignored him when he brought the wrongdoing to her attention and that he was demoted when he persisted. His lawsuit claims he later suffered two heart attacks from the job-related stress, leaving him in a wheelchair.

Federal criminal charges were later brought against operators of adult education programs in Sacramento and Los Angeles. In addition, the department under Eastin agreed to repay more than $3 million to the U.S. Department of Education.

In the Lindberg case, a Sacramento jury in 2002 found the department and both defendants personally liable for his health problems and awarded him $4.5 million in damages. The department appealed the decision, and a new jury awarded the whistle-blower $7.6 million in April.

In the state's latest motion, filed late last month, lead attorney David Cheit argues that the retrial judge unfairly prejudiced the jury and disallowed some evidence that would have helped the state's case.

"The court infected the entire trial with a measure of prejudice that was beyond cure," Cheit wrote in the brief. "The result was an award that can only be explained as the result of passion and prejudice, and which, even more so than the first award, is excessive as a matter of law."

McLean said the department still believes the case is winnable and that it is in taxpayers' best interests to pursue it.

"It's unfortunate that it's taking us so many steps through the legal system to get there," she said.

Lindberg's attorney, Gaspar Garcia, has appealed the state's motion for a new trial.

Duvall said he is frustrated after making repeated requests and receiving what he describes as only vague answers in return. He said he is concerned about how much the latest appeal will cost the state.

"I want to know how much money has been spent, I want to know where it came from, and I want to know why it's not budgeted," Duvall said Wednesday.

Duvall noted that about $2 million was included in last year's budget to pay for legal challenges to the state's high school exit exam, yet none of the money for the Lindberg lawsuit is identified in the state budget.

McLean said such line-item spending is only required when the Legislature or governor set aside money to fight a specific case.

"There are many cases that departments throughout state government deal with that are not specifically addressed in line items in the budget," she said.

Documents previously obtained by the AP show the department authorized the transfer of more than $750,000 starting in 2001 from adult education and special education programs for deaf, blind and other special-needs children to pay for the Lindberg and related cases.

McLean said they were incorrectly coded. The money actually came from the department's general fund, she said.

The new documents released by the controller's office, however, show that the education department moved more money from specific programs to pay private attorneys. That includes:

— $100,000 from the "hate violence/tolerance fund." It was not immediately clear what this program does.

— $65,000 from the High-Risk Youth Education and Public Safety Program, which provides after-school programs for students who have been incarcerated or are first-time offenders.

— $35,000 from the community day schools fund, which serves high-risk youth.

— The source of another $100,000 transferred in the 2005-06 budget year was not specified.

All those funds list an accounting code that corresponds to the state superintendent's office. The department could not immediately respond to questions about those funds, McLean said.

Meanwhile, Garcia, the whistle-blower's lawyer, said he was preparing a motion seeking the court-ordered compensation for Lindberg's mounting legal fees, which he said are likely to total about $600,000.



William Jefferson's Legal Bills Could Top $2 MIL
U.S. Legal News | 2007/06/12 15:27

Attorneys say U-S Representative William Jefferson is facing legal bills that could reach two million dollars to fight complex public corruption charges that include bribery, racketeering and money laundering.

As of yesterday, the New Orleans Democrat had 136-thousand dollars in a legal defense account, a net debt in his campaign election fund and a congressional salary of 165-thousand, 200 dollars a year.

Election and white-collar defense attorneys in Washington say Jefferson's trial could last two to three months.

Evidence against him fills eight file cabinets.

Lawyers say a defense of that complexity and length easily could push Jefferson's defense costs into seven figures.

Campaign lawyer Ken Gross says the case involves a lot of witnesses and the case has a lot of tentacles.

A federal grand jury in Virginia indicted Jefferson last week on 16 counts of public corruption.

The indictment alleges Jefferson used his influence as co-chairman of the House Africa Investment Trade Caucus to broker deals in various African nations.

Jefferson maintains his innocence.



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