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Law firm to pay millions in age discrimination case
Headline News |
2007/10/06 04:09
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One of the nation's largest law firms has agreed to pay a $27.5-million settlement to 32 former partners to end a ground-breaking age discrimination case, the Equal Employment Opportunity Commission announced today. The case against Sidley Austin, which has more than 1,700 lawyers in 16 cities, including Los Angeles, had been closely watched because of a widely held belief in the legal profession that firm partners did not qualify for the protections of federal anti-discrimination laws because they were deemed "employers."
But the EEOC, in a lawsuit filed in 2005, contended that the cashiered lawyers were partners in name only, because they had no voice in the firm's management, including hiring, firing and salary decisions. Consequently, the lawyers were "employees" entitled to protections of the Age Discrimination in Employment Act.
The firm vigorously defended the case, but lost key preliminary rounds in U.S. District Court in Chicago and at the U.S. 7th Circuit Court of Appeals. The Supreme Court declined to review the decisions. Eventually, the Chicago-based firm decided to settle by agreeing to a consent decree without admitting wrongdoing.
However, Sidley Austin, in the consent decree, approved by U.S. District Judge James B. Zagel in Chicago on Thursday, made a significant concession, agreeing "that each person for whom the EEOC has sought relief in this matter was an employee within the meaning of" the Age Discrimination in Employment Act.
The decree also includes an injunction that bars the firm from "terminating, expelling, retiring, reducing the compensation of or otherwise adversely changing the partnership status of a partner because of age," or "maintaining any formal or informal policy or practice requiring retirement as a partner or requiring permission to continue as a partner once the partner has reached a certain age."
John Hendrickson, the EEOC's regional attorney in Chicago, said he thought the outcome set an important benchmark.
"Up to now, with no particularly good reason that I can discern, people in control of law firms said that if they called someone a partner ... they didn't need to worry about federal employment discrimination laws," he said.
"What the Sidley case says is that you have evidence that people are called partners, but in reality are not active in the governance of the firm and don't control their own destiny in the firm. You can call them whatever you want, but for the purposes of the Age Discrimination Act they are employees," Hendrickson said.
He said the case ensured "the protection of professionals from discriminatory employment actions" and ratified the authority of the EEOC "to investigate and obtain relief for victims of age discrimination on its own initiative."
During the litigation, the U.S. 7th Circuit Court of Appeals ruled that the agency was entitled to obtain records that could show whether the lawyers should have been protected under age discrimination law.
In that key ruling, Judge Richard Posner, writing for a unanimous three-judge panel, rejected Sidley's argument that the law did not apply to partners. Posner said he was particularly unconvinced by "Sidley's contention that since the executive committee [of the firm] exercises its absolute power by virtue of delegation by the entire partnership in the partnership agreement, we should treat the entire partnership as if it rather than the executive committee were directing the firm. That would be like saying that if the people elect a person to be dictator for life, the government is a democracy rather than a dictatorship."
Ronald S. Cooper, the EEOC's general counsel in Washington, emphasized the broader ramifications of the settlement.
"The demographic changes in America assure that we will see more opportunities for age discrimination to occur. Therefore it is increasingly important that all employers understand the impact of the Age Discrimination in Employment Act on their operations and that we reemphasize its important protection for older workers," he said.
The amount to be paid to each of the 32 former Sidley lawyers was placed under seal. However, the EEOC said that the payments averaged $859,375 per attorney, and ranged from a low of $122,169 to a high of $1,835,510. The EEOC said each of the lawyers either had been "expelled from the partnership in connection with an October 1999 reorganization or retired under the firm's age-based retirement policy."
The EEOC began an investigation of Sidley in 2001 after major changes at the firm. According to the suit, the firm for many years had a mandatory retirement age of 65. But in 1999, 32 lawyers -- all over age 40 -- were told that their status was being downgraded from partner to "special counsel" or "counsel," and that their pay would be reduced by about 10%. They also were told that they would soon have to leave the firm.
David A. Richards, one of the 32, said he thought the firm had taken the action, at least in part, to increase profits for the remaining partners. Richards, who was 54 at the time, said when he was told of his change in status, there was "absolutely" no contention that managing partners had problems with his performance.
A year or so later, Richards landed a job with McCarter & English, a large New York firm, where he still works as a real estate lawyer. On Friday, Richards said, "The settlement was overdue, but it gives all involved a satisfactory conclusion." The lawyers who sued now "have confirmation that their discharge was not for the quality of their work."
The commission, Richards emphasized, "has established an important legal principle for all large professional partnerships."
Sidley, through a New York public relations firm, issued a formal statement saying that it "believes that settling this case is preferable to the costs and uncertainties of continued litigation."
"This settlement puts the cost, time and distraction of this litigation behind us. Moreover, continuing litigation with the EEOC would have placed us in an adversarial position with former partners."
The firm said it continued to employ some of the lawyers who were stripped of their partnerships in 1999, but did not say how many.
The consent decree in the case runs until Dec. 31, 2009. During that period, Abner Mikva, a retired federal appeals court judge who also served as a Democratic congressman from Illinois and White House counsel during the Clinton administration, will monitor any complaints from former Sidney partners and report them to the EEOC. |
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High court examines judges' power to be lenient
Headline News |
2007/10/03 16:13
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| The Supreme Court struggled Tuesday with how much discretion U.S. judges have to give lenient sentnces, including in crack cocaine cases. The justices appeared torn on the question that could affect tens of thousands of federal defendants prosecuted each year. The high court has imposed standards for sentencing in recent years to ensure that judges boost prison time based only on facts proved to a jury beyond a reasonable doubt, such as establishing that a crime was particularly cruel. A side effect of those decisions has been confusion over how much discretion trial judges have to vary sentences beyond the U.S. Sentencing Guidelines, adopted in the 1980s to bring uniformity to prison time and counteract race, wealth and other biases. Judges found that the guidelines sometimes prevented them from dealing fairly with individual circumstances. The Supreme Court ruled in 2005 that the guidelines should be considered advisory, not mandatory. Now the question is how appeals courts should determine whether a sentence outside the guidelines was "reasonable." Brian Gall was convicted in Iowa of conspiracy to sell the drug Ecstasy. He was given probation rather than the guidelines' range of 30-37 months behind bars. The judge noted that Gall walked away from the conspiracy at age 21, finished college and started a business. He turned himself in when he was later indicted. Derrick Kimbrough was convicted in Virginia of selling crack and powder cocaine and sentenced to 15 years in prison rather than 19-22 years under the guidelines. The judge cited Kimbrough's military service, along with the controversy over the disparity in punishments for crack and powder cocaine crimes. Sentences for dealing crack cocaine are far harsher than those for powder: 1 gram of crack cocaine triggers the same sentence as 100 grams of powder. The Sentencing Commission, which recommended that Congress narrow the 100:1 ratio, says the stiff crack sentence falls disproportionately on black offenders and low-level dealers. In the Gall and Kimbrough disputes, appeals courts said the judges lacked the latitude to give the lower sentences. The defendants appealed. Justice Samuel Alito, who spent 15 years as an appellate judge before being appointed to the high court, was an active questioner Tuesday. He challenged Gall's lawyer, Jeffrey Green, on the notion that a judge could show leniency based on a defendant's youth, calling that "a policy question." To Kimbrough's lawyer, Michael Nachmanoff, Alito suggested judicial latitude on cocaine sentences could pose a dilemma for appellate judges. "What if (an appeals court) sees a number of absolutely identical cases?" he asked. If one sentencing judge used a 1:1 ratio, the next one used 20:1 and the next 50:1, "what is it to do under 'reasonableness' review?" Nachmanoff said that if the judges in those cases had sufficient reasons, the sentences should be upheld. Justice Department lawyer Michael Dreeben, seeking to win longer sentences for the two men, urged an approach used by many appeals courts. It demands that a sentence varying significantly from the guidelines be justified by a rationale that is equally weighty. Justice John Paul Stevens wondered if that test was too vague: "How do you measure the strength of the justifications?" Dreeben noted that the differing cocaine penalties stemmed from Congress' view in its 1986 law that crack-dealing spawned more violence. "For a judge to say Congress is crazy," Dreeben said, "is a sort of textbook example of an unreasonable sentencing factor." |
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U.S. court opens term, with terrorism, death penalty
Headline News |
2007/10/02 09:16
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| The U.S. Supreme Court began a new term on Monday featuring blockbuster cases on Guantanamo prisoners and the death penalty, and it rejected some 2,000 appeals that had piled up during its summer recess. Returning to the bench, the nine justices also heard arguments on Washington state's primary election system and whether parents of disabled students can get reimbursed for sending their children to private schools. Legal experts are watching this term to see the future direction of the highest U.S. court that has been closely divided, with a 5-4 conservative majority bolstered by President George W. Bush's two appointees -- Chief Justice John Roberts and Justice Samuel Alito. The court will rule on whether the hundreds of detainees at the U.S. military prison in Guantanamo Bay in Cuba can use American courts to challenge their indefinite confinement and on the current lethal injection method of execution. The term that ended in June was marked by a sharp shift to the right on divisive social issues like abortion and civil rights law. Legal experts are divided on whether the trend will continue this term, an issue already being discussed in the November 2008 presidential race. ROMNEY WOULD NAME STRICT CONSTRUCTIONISTS In Boston, Republican candidate Mitt Romney said cases this term could dramatically affect the "lives of all Americans" and he vowed to name justices "in the strict constructionist mold" of Roberts, Alito and their fellow conservatives, Antonin Scalia and Clarence Thomas. |
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TX. Legal trade Political bond is strong
Headline News |
2007/10/01 15:00
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| One need only look to the names of Houston's law firms to see the city's political and legal landscapes are intertwined. Bracewell & Giuliani stands out most now — with former New York mayor and presidential candidate Rudy Giuliani's name chiseled in stone outside the downtown tower offices. The city's Big Three firms have political cachet, too. Vinson & Elkins is named in part for former political power broker and County Judge James A. Elkins. The Baker in Baker Botts is the ancestor of current firm member and former Secretary of State James A. Baker III. Fulbright & Jaworski's name includes that of Watergate special prosecutor Leon Jaworski. Though smaller firms may have a party leaning and plaintiffs' firms usually back Democrats, large firms typically are happy to have their partners meddle in mainstream politics and run for office, no matter the party. "It's totally encouraged," said Pat Mizell, a former state district judge and Republican activist who is a partner at Vinson & Elkins. "We've been at it a long time here, we've had John Connally, Howard Baker in D.C. and Congressman Mike Andrews." Connally was Texas governor, Baker a U.S. senator from Tennessee and Andrews is from Houston. That's not even to mention political power broker and former partner Joe B. Allen, 2006 Democratic U.S. Senate nominee Barbara Radnofsky, and former U.S. Attorney General Alberto Gonzales. Part of the synergy is the logical link between lawyers and lawmaking. But it has as much to do with the connections made in politics boosting the bottom line for law firms. "It's better to know a lot of people as a lawyer. The more contacts you have, the better you can serve your clients," Mizell said. Individual idealism can be involved, as well. Those ideals may vary within a large firm. At Bracewell & Giuliani, managing partner Pat Oxford is heavily involved in the Giuliani presidential campaign and has been a Bush family crony for years. But partner Carrin Patman ran for Congress as a Democrat while at the firm a few years back. Patman said political activity is a part of "the fabric of the firm." Founder Searcy Bracewell was a state legislator himself, she noted. "The firm likes to be represented on both sides," said Patman, who is raising funds for Democratic presidential candidate Hillary Rodham Clinton. Chris Bell, a former city councilman, mayoral candidate, congressman and last year's Democratic nominee for Texas governor, now works for Patton Boggs, a Washington, D.C.-based law firm known for lobbying — a profession that requires political activity and savvy. "Not all professions lend themselves to public service from a scheduling standpoint like the law does," Bell said. He was at Houston firm Beirne, Maynard & Parsons while on the City Council and while running for mayor and Congress. The same firm is now home to former Republican state Rep. Joe Nixon. A cursory view last week of 2007 federal elections filings for folks who listed their Houston law firms showed a wide variety of contributions within big firms. As you'd expect, at Bracewell & Giuliani there were a lot of contributions for the name partner. But a few lawyers also gave to the campaigns of Democrats Clinton, Sen. Barak Obama, New Mexico Gov. Bill Richardson, and former U.S. Sen. John Edwards, and on the GOP side, former Massachusetts Gov. Mitt Romney. Fulbright & Jaworski's two biggest presidential contribution beneficiaries as of last week were Obama and Giuliani. At Vinson & Elkins it was Clinton, Giuliani and Obama. And at Baker Botts, the favorites were Romney, Obama and Republican U.S. Sen. John McCain of Arizona. Frank Harmon, a small-firm lawyer and local Republican activist, said one of the places law firms and politics interact the most is in judicial races. "Right now, every day I receive at least one, and as many as three, invitations to a judicial fundraiser. Nobody could write a check to all these guys," said Harmon. |
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Law firms inspired by YouTube
Headline News |
2007/09/29 18:32
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| U.S. law firms are using recruiting Web sites with YouTube-inspired layouts and videos to appeal to the younger crowd of prospective summer associates. The videos range from professional-looking ads featuring actors to videos that feature company employees speaking about the firm's expertise or its diversity, The New York Times reported Friday. "The videos are still kind of in the early days," said Brian Dalton, the senior law editor at Vault Reports, which ranks law firms. "A lot of them come off seeming like hostage videos." A series of videos created by Boston law firm Choate Hall & Stewart echoes the "Mac vs. PC" ads created by Apple. The video series, called "Choate vs. Megafirm," features a frustrated Megafirm employee complaining about his firm, while a self-assured Choate employee sings her employer's praises. However, sometimes law firms recognize when their attempts to be hip go too far. Los Angeles firm Quinn Emanuel Urquhart Oliver & Hedges pulled a video from their Web site before it even went live. The video, titled "A Day in the Life of an Associate," followed a jeans-wearing associate named Ivey who plays Ultimate Frisbee in between meetings with partners. "Some of the associates, some of the partners, thought it was too contrived; maybe corny was probably a better word," said A. William Urquhart, the firm’s hiring partner. |
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Jets Fan Sues Pats, Seeks $184 Million
Headline News |
2007/09/29 18:21
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| New York Jets season-ticket holder filed a class-action lawsuit Friday against the New England Patriots and coach Bill Belichick for "deceiving customers." The lawsuit filed in U.S. District Court in Newark, N.J., by Carl Mayer of Princeton Township, N.J., stems from the Patriots being caught illegally videotaping signals from Jets coaches in New England's 38-14 season-opening win Sept. 9. "They violated the integrity of the game," Mayer's attorney, Bruce Afran, told The Associated Press. "This is a way of punishing Belichick and the Patriots." Mayer is seeking more than $184 million in damages for Jets ticket holders. Belichick was fined $500,000 by NFL commissioner Roger Goodell, and the team was fined $250,000 for violating a league rule that prohibits clubs from using a video camera on the sidelines for any purpose -- including recording signals relayed to opposing players on the field. New England also must forfeit a first-round draft pick next year if it makes the playoffs or a second- and third-rounder if it doesn't. "They were deceiving customers," said the 48-year-old Mayer. "You can't deceive customers." The lawsuit maintained that because other teams found illegal videotaping by the defendants, Jets ticket holders should be compensated for all games played in Giants Stadium between the Jets and Patriots since Belichick became head coach in 2000. The two calculated that because customers paid $61.6 million to watch eight "fraudulent" games, they're entitled to triple that amount -- or $184.8 million -- in compensation under the federal Racketeer Influenced and Corrupt Organization Act and the New Jersey Consumer Fraud Act. "How many times have the Patriots done this? We find it hard to believe they did it just once," Mayer said. "We just want to get to the truth of the matter of what the Patriots did to the Jets. I think the ticket holders are genuinely concerned about it. This is a type of misrepresentation." Patriots spokesman Stacey James declined to comment on the lawsuit. Mayer and Afran, who consider themselves public interest lawyers, have been thorns in the side of New Jersey politicians for years, filing lawsuits and demanding investigations to advance their grievances. They are well known in the state but generally have had little success in their causes. Both have lost bids for elected offices, and Mayer once served as a presidential campaign adviser to Ralph Nader. Their demand in March for a probe of Gov. Jon S. Corzine's gifts to a former girlfriend was rejected by a federal prosecutor. In 2006, a judge vetoed their effort to block Corzine's appointment of Rep. Robert Menendez, D-N.J., to fill the governor's seat in the U.S. Senate. They also failed to get a court to order a special election to replace Gov. James E. McGreevey when he resigned in 2004. Now, they're taking on the Patriots. Their latest lawsuit asserted that the secret videotaping violated the contractual "expectations and rights" of Jets ticket holders "to observe an honest match played in compliance with all laws and regulations." The actions of Belichick and the Patriots violated federal and state racketeering laws, as well as the New Jersey Consumer Fraud Act and New Jersey Deceptive Business Practices Act, according to the lawsuit. "Having been a lifelong Jets fan, as soon as I heard this, I was completely outraged," Mayer said. "The NFL just slapped them on the wrist. I'm a consumer lawyer, and this is consumer fraud." |
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