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In California, Retro-Tech Complicates Budget Woes
Lawyer News | 2008/08/06 13:15

Faced with a $15 billion budget shortfall and a testy State Legislature, Gov. Arnold Schwarzenegger is dealing with a host of critics, including pro-tax Democrats, tax-averse Republicans and a public increasingly displeased with him.

Now, even the state’s computers seem to be against him.

Last week, with no budget agreement in sight, the governor issued an executive order terminating thousands of part-time and temporary state employees and slashing the wages of about 170,000 of the state’s full-time workers to the federal minimum wage.

But the California controller, John Chiang, says the state’s payroll system — which uses a programming throwback known as Cobol, or Common Business-Oriented Language — is so antiquated it would take months to make the changes to workers’ checks.

“In 2003, my office tried to see if we could reconfigure our system to do such a task,” Mr. Chiang told a State Senate committee on Monday. “And after 12 months, we stopped without a feasible solution.”

David J. Farber, a computer science professor at Carnegie Mellon University, said using Cobol was roughly equivalent to having “a television with vacuum tubes.”

“There are no Cobol programmers around anymore,” Mr. Farber said. “They retired centuries ago.”

Mr. Farber said California was not alone in having out-of-date systems — or handy excuses.

“It’s old technology, and you can’t find a repairman who knows how to fix it,” he said. “It also a neat way of figuring how not to get your salary cut.”

Even before his remarks to the Legislature, Mr. Chiang, a Democrat, had made no secret of his dislike for the order by Mr. Schwarzenegger, a Republican, saying he would refuse to follow it even if the state’s computers could handle the job. The governor, in turn, has threatened to sue Mr. Chiang to force the pay cuts, saying Mr. Chiang was violating a 2003 California court decision mandating that state employees take minimum wage if the Legislature does not pass a budget.

The current budget expired on July 1. Negotiations among lawmakers have been as sluggish as the state’s computers.



A judge on Tuesday recommended clearing the record of a wrongly convicted man who spent 25 years in prison for a series of sex crimes he did not commit.
Headline News | 2008/08/06 13:14

A judge has disqualified a lawyer from representing a woman suing former state Sen. Gary George, saying his law firm has a potential conflict of interest.

The firm must withdraw because it employs former Attorney General Peg Lautenschlager and her deputy, who have confidential information that could be used against George, U.S. District Judge Barbara Crabb ruled.

She ordered Victor Arellano of Lawton & Cates to stop representing Delilah Tucker, who once worked in George's Capitol office.

Tucker is suing George and his former chief of staff Dan Rossmiller for violating her constitutional rights to free speech. She claims the two retaliated against her after she raised concerns about having to do personal and campaign work for the Milwaukee Democrat. She says she was ultimately fired and replaced by "a European beauty."



Texas wants 8 kids from sect back in state care
Lawyer Blog News | 2008/08/06 13:13
Texas child welfare authorities asked a judge on Tuesday to place eight children from a Texas polygamist sect's ranch back into foster care, saying their mothers refuse to limit their contact with men accused of being involved in underage marriages.

Child Protective Services filed petitions asking Texas District Judge Barbara Walther to place the six girls and two boys belonging to four different mothers back in foster care.

The children, ranging in age from 5 to 17, will be allowed to remain with their mothers until a hearing scheduled for Sept. 25, said CPS spokeswoman Marleigh Meisner. None currently lives at the Yearning For Zion Ranch in Eldorado.

CPS filed petitions detailing alleged involvement in underage marriages by the children's fathers or stepfathers, submitting sect marriage documents, notes from suspected underage brides, photos and journal entries from Warren Jeffs, the jailed leader of the Fundamentalist Church of Jesus Christ of Latter Day Saints.

Two of the girls are daughters of Lloyd Hammon Barlow, a doctor indicted last month on three misdemeanor counts of failing to report child abuse, according to court filings.

Five other sect members, including Jeffs, were charged with sexual assault last month, but their children are not among those in the CPS petitions. The other six children are related, by blood or marriage, to men who are not under indictment but are accused by child welfare authorities of participating in or blessing underage marriages.

An FLDS spokesman did not immediately respond to a call seeking comment Tuesday.

CPS has continued its investigation of the 440 children taken from the Eldorado ranch since the Texas Supreme Court ruled in late May that the children should not have been swept into foster care under a blanket petition and hearing. The court said evidence showed no more than a handful of girls were abused or were at risk of abuse.



Spanish court opens second Tibet probe
Legal World News | 2008/08/06 13:11
Spain's National Court on Tuesday said it will review allegations that two Chinese government ministers and five other officials were responsible for repressing protests against Chinese rule in Tibet earlier this year.

Two Spanish pro-Tibet groups filed a lawsuit, claiming the seven officials were responsible for at least 203 deaths, more than 1,000 injured and nearly 6,000 illegal arrests and disappearances during the March protests.

Investigative magistrate Santiago Pedraz said the court is entitled to investigate under Spain's principle of universal jurisdiction for cases dealing with charges, such as genocide and crimes against humanity, regardless of where they were allegedly committed.

The statement names Defense Minister Lian Guanglie and State Security Minister Geng Huichang among the seven. Two army officials and two senior Communist Party officials are also being probed.

After studying the evidence, the judge will decided if there is sufficient evidence to file charges.

The Chinese foreign ministry in Beijing said it had seen the news reports on the matter but had no immediate comment.

The groups filing the suit were named as the Tibet Support Committee and the House of Tibet Private Foundation.

In recent years, Spanish magistrates have used the principle of universal jurisdiction several times to pursue cases in different countries, most notably against members of former military regimes in Latin America, but extraditions and convictions have been rare.

In a separate case, the Madrid court has also been reviewing since 2006 another lawsuit filed by the Tibet Support Committee against several former Chinese officials for alleged genocide in the years after Chinese Communist troops entered Tibet in 1951.



IRS Warns About Donor-Advised Funds
Lawyer News | 2008/08/06 11:17

The Internal Revenue Service has issued a guide sheet for organizations that maintain donor-advised funds to help safeguard against abuses.

Donor-advised funds allow organizations to make contributions that are generally treated similarly to contributions to charities, providing them with greater tax benefits than donations to private foundations. The guide sheet includes a series of questions to establish whether the organization qualifies as a sponsoring organization.

In an explanation accompanying the guide sheet, the IRS describes several court precedents, including a 2006 case, New Dynamics Foundation v. United States, in which the court determined that the foundation did not qualify for a tax exemption because it permitted donors to use funds to serve their private interests.

"Donor-advised funds are intended to accomplish charitable purposes rather than to generate fees from securities trading for investment advisors," said the IRS explanation. "If the arrangement produces too much private benefit to the financial company, the organization does not qualify for exemption."




Wilson Sonsini Paid Client $9.5M to Defray Backdating Costs
Headline News | 2008/08/05 15:30

Brocade Communications Systems, seeking to recoup losses from the company's stock-option scandal, has decided to pursue racketeering claims against 10 former executives and directors of the company, including former Chief Executive Gregory Reyes, now in prison for his role in the backdating. However, in court filings released Monday, the company announced it did not plan to pursue claims against Silicon Valley über-lawyer Larry Sonsini and his firm, Wilson Sonsini Goodrich & Rosati.

Brocade's special litigation committee emphasized that Sonsini, who had played controversial dual roles at Brocade as both its corporate counsel and as a board member, and his firm had maintained that they had been misled by Reyes.

The filings revealed that another reason was a $9.5 million "contribution" from Wilson Sonsini to defray legal expenses related to the scandal.

"These guys did a very thorough investigation and found it would be inappropriate to pursue a claim against the firm or any one of its lawyers," said Wilson Sonsini spokeswoman Courtney Dorman.

In its 307-page filing, the litigation committee said it would assert claims against the defendants under the Racketeer Influenced and Corrupt Organizations Act, known as RICO, for violations of federal law.

The new Brocade suit also targets Stephanie Jensen, Brocade's former vice president of human resources, who was also convicted of federal crimes. It also names five other former

executives and three directors on Brocade's audit committee: Neal Dempsey, Mark Leslie and Seth D. Neiman.
Reyes' attorney Richard Marmaro said it is "sad" that the Brocade committee "has chosen to denigrate the accomplishments of so many past and present employees by recklessly suggesting that at the height of its success, Brocade was used as a racketeering enterprise."

Brocade was among the first companies to come under suspicion for secretly manipulating stock options to benefit insiders, foreshadowing a national scandal that raised suspicions at more than 200 firms. The scandal prompted criminal charges, the ousters of scores of executives and billions of dollars worth of financial restatements.



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