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Today's Date: U.S. Attorney News Feed
White House backs banks in Supreme Court case
Lawyer Blog News | 2007/08/16 14:55
The brief by the U.S. solicitor general contradicts a brief filed by the Securities and Exchange Commission, which argued for shareholders' rights to sue those third parties. "Allowing liability for a primary violation under the circumstances presented here would constitute a sweeping expansion of the judicially inferred private right of action" under securities law, wrote Solicitor General Paul Clement.

Such a move could expose customers, vendors and others to "billions of dollars in liability when issuers of securities make misstatements to the market," he wrote.
Clement wrote that allowing third parties to be sued would "vastly expand liability in unpredictable ways."

The case, Stoneridge Investment Partners v. Scientific-Atlanta, Inc., has attracted considerable interest from lawmakers and industry associations. On Tuesday, Senate Banking Committee Chairman Christopher Dodd, D-Conn., asked President Bush to back the SEC's position.

Meanwhile, Securities Industry and Financial Markets Association President Marc Lackritz said allowing third parties to be held liable would result in skyrocketing litigation costs for companies.

"Investors already receive substantial protections under the law, and the Securities and Exchange Commission and other securities regulators are already armed with all the necessary regulatory tools to recoup lost money for investors," Lackritz said.
Similarly, the U.S. Chamber of Commerce, a business trade group, had urged the court to reject the expanded liability, known in legal terms as "scheme liability."

"Congress authorized the SEC to enforce securities laws against third parties and disburse funds to harmed investors," said Robin Conrad, executive vice president of the National Chamber Litigation Center.

"The Supreme Court should not upset that legislative decision by allowing class action lawyers to increase litigation risk and further hamper the competitiveness of American markets," Conrad said.

The Supreme Court is scheduled to hear the case in its fall term.


Brodsky & Smith, LLC Announces Settlement of Class Action
Lawyer Blog News | 2007/08/16 12:05

Brodsky & Smith, LLC announces that a Court has preliminarily approved a class action settlement in TDH Partners v. The Ryland Group, Inc., et. al. involving all persons who purchased or otherwise acquired common stock of the Ryland Group, Inc. (NYSE: RYL) ("RYLAND"), between October 3, 2003 and January 7, 2004, inclusive, ("the Settlement Class"). This case is pending in the United States District Court for the Northern District of Texas.

Pursuant to a Court Order, a hearing will be held in this case (the "Action") on December 11, 2007 at 10:00 A.M. before United States District Judge Jane Boyle, at the United States Courthouse, 1100 Commerce Street, Dallas, Texas 75242, to determine: (1) whether the settlement of claims asserted in this Action in return for payment of One Million, Two Hundred Thousand Dollars ($1,200,000.00) in cash plus accrued interest (the "Settlement Fund"), from which all administrative expenses, taxes owed and Court-awarded attorneys' fees and expenses will be paid, should be approved by the Court as fair, reasonable and adequate to the members of the Settlement Class; (2) whether the proposed plan of allocation for the Settlement Fund after payment of all administrative expenses, taxes owed and Court-awarded attorneys' fees and expenses (the "Plan of Allocation") is fair, reasonable and adequate to the members of the Settlement Class; (3) whether and in what amount to approve an incentive award to the Lead Plaintiff and whether to approve the application of the Class' Lead Counsel for an award of attorneys' fees not in excess of 33% and expenses not in excess of $150,000.00 should be approved; and (4) whether the Action should be dismissed with prejudice as set forth in the Settlement Agreement dated as of March 15, 2007 and filed with the Court.

Persons who purchased or otherwise acquired the common stock of RYLAND during the period from October 3, 2003 through January 7, 2004, inclusive (the "Settlement Class Period"), may be affected by the settlement of this Action, including the release and extinguishment of claims they may possess relating to the purchase or other acquisition of the common stock of RYLAND during the Settlement Class Period. To share in the distribution of the Settlement Fund, eligible shareholders must establish their rights by mailing a Proof of Claim Form on or before November 15, 2007.

Shareholders who desire to be excluded from the Settlement Class must file a request for exclusion by November 15, 2007, in the manner and form explained in the detailed Notice of Pendency and Proposed Settlement of Class Action. All members of the Settlement Class who have not requested exclusion from the Settlement Class will be bound by any judgment entered in the Action.



Ex-NBA Referee Pleads Guilty to Charges
Lawyer Blog News | 2007/08/15 14:38

Former referee Tim Donaghy pleaded guilty to two felony charges Wednesday in connection with the NBA betting scandal. Donaghy faces a maximum of 25 years in prison when he is sentenced for conspiracy to engage in wire fraud and transmitting waging information through interstate commerce. Donaghy provided recommendations, called "picks," to co-conspirators about what team they should bet on, said U.S. District Court Judge Carol Bagley Amon. If he was correct, they paid him.

The information was not public, the judge said. Donaghy had "unique access," including what crews would officiate at games, the interaction of different officials and players, and the physical condition of certain players.

He concealed the scheme from the NBA and other referees to avoid detection, the judge said. Donaghy also must pay a $500,000 fine and at least $30,000 in restitution.

Prosecutors said in open court that Donaghy bet on games himself; but that was not part of his plea.

The FBI first contacted the NBA on June 20 to talk about a referee alleged to be gambling on games, and the two sides met on June 21, NBA commissioner David Stern said last month. Donaghy resigned July 9 after 13 years as a referee; Stern said he would have fired him sooner but was told it might affect the investigation.

Stern blamed a "rogue, isolated criminal" for the betting scandal that threatened the credibility of every referee.

Donaghy was rated in the top tier of officials, Stern said, and there was nothing suspicious about the frequency of his foul calls. He was assigned to work in the second round of the playoffs, with his last NBA game coming during the Phoenix-San Antonio Western Conference semifinal series.

No other NBA officials or players were expected to be involved in the scandal, which Stern called the "most serious situation and worst situation that I have ever experienced either as a fan of the NBA, a lawyer for the NBA or a commissioner of the NBA."



Appeals court rules in Hanford downwinders' case
Lawyer Blog News | 2007/08/15 13:41
In a sweeping ruling Tuesday, a federal appeals court overturned a judgment in favor of a woman who had sued contractors at the Hanford nuclear reservation for causing her thyroid cancer, but opened the door for three other plaintiffs to get a new trial.

A three-judge panel of the 9th U.S. Circuit Court of Appeals in San Francisco also upheld a lower court's ruling dismissing the defendants' claims that they were immune from punishment because they were government contractors.
Since 1990, more than 2,300 people have sued over health problems they believe were caused by exposure to radioactive emissions from south-central Washington's Hanford site over the years. The downwinder cases are largely based on the release of iodine-131, a radioactive byproduct of nuclear weapons production.

A judge dismissed six of the 12 initial "bellwether" cases. In 2005, juries rejected four more during two trials. Just two people, who suffered from cancer, won damages totaling $544,759 against the government and the contractors that managed the federal site at the time.

The appeals court on Tuesday overturned the verdicts against three plaintiffs, Wanda Buckner, Shirley Carlisle and Kathryn Goldbloom, who suffer from hypothyroidism, a condition that slows the body's metabolism.

The district court erred in ruling that the plaintiff's endocrinologist could not testify that he authored articles on I-131's effect on thyroid cells, because it deprived the jury of testimony from the doctor about the extent of his expertise regarding causes of thyroid illness, the appeals court ruled.

In addition, the defendants were allowed to impeach the doctor's testimony based on inadmissible hearsay of another doctor who did not testify, the court ruled.

"We thus have no choice but to reverse the verdicts against plaintiffs Goldbloom, Carlisle, and Buckner and remand for a new trial," Chief Circuit Judge Mary M. Schroeder wrote for the panel.

The court also overturned the ruling in favor of plaintiff Gloria Wise, who was awarded $317,251, on statute of limitations grounds. However, the appeals court remanded the case to district court to determine whether Wise had the information necessary to file a claim within the three-year statute of limitations.

That particular ruling is significant because it could mean the claims of hundreds of other plaintiffs will be time-barred, said Kevin Van Wart, whose Chicago law firm represents General Electric Co., E.I. DuPont de Nemours Co. and UNC Nuclear Inc.

Richard Eymann, a plaintiffs attorney, said he did not yet know how many other clients could have their cases dismissed as a result. Despite that potential impact, Eymann called the overall ruling a victory for the downwinders.

"We're hoping that the contractors and the government will get into serious settlement negotiations with us," he said.

The federal government created Hanford in the 1940s as part of the top-secret Manhattan Project to build the atomic bomb. Contractors operated reactors and other facilities that historical documents say resulted in intentional and accidental releases of toxic chemicals and radiation.

Residents only learned of the emissions when the government declassified thousands of documents in 1986.

People in Arizona, Nevada, Utah and the Marshall Islands have received compensation for being exposed to radiation during the atomic buildup. Downwinders at the Hanford site have had a more difficult time because health studies have offered differing opinions on whether they have suffered substantial or chronic exposures that threatened their health.

Iodine-131 concentrates in the thyroid, which regulates the body's metabolism. Most of the plaintiffs have thyroid conditions, such as cancer, hypothyroidism and hyperthyroidism. To succeed at trial, plaintiffs had to prove they were “more likely than not” harmed by radioactive iodine gases released during Hanford operations.

That can be difficult to prove, in part because thyroid disorders are not caused only by exposure to radiation. The plaintiffs' had asked the court to expand the test for causation when there are potentially multiple causes, such as radiation, smoking, genetics or pregnancy.

The appeals court rejected that request.

The court rejected the companies' claims that they were immune from punishment because they were government contractors. The district court already had rejected that claim, as well as claims that the defendants could be held liable for any I-131 emissions from the Hanford facility, which the appeals court rejected as well.

The government already indemnified the contractors under the Price-Anderson Act and must pay any damage awards.

The court denied an appeal by plaintiff Shannon Rhodes, whose claims were rejected by a jury, and upheld the $227,508 award for plaintiff Steve Stanton.

The court also denied an appeal to move to state court claims by other plaintiffs who do not yet have symptoms of any thyroid disease. They had previously sued the contractors for the costs of medical monitoring, but their claims were dismissed.

Van Wart called the last ruling particularly significant because it could have potentially involved thousands of additional plaintiffs.



Lawyer hopes Bali heroin three will be spared
Lawyer Blog News | 2007/08/15 13:40

Three judges from the Denpasar District Court have advised the Supreme Court to reject a last-ditch appeal by Australian drug smugglers Matthew Norman, Si Yi Chen and Tan Duc Thanh Nguyen. But the trio's lawyer Farhat Abbas insists the Supreme Court is under no obligation to take the lower court's opinion into consideration.

A decision on the appeal, known as a judicial review, is not expected for at least several weeks. "The decision makers are the judges at the Supreme Court," Abbas said today.

"The opinion from the district court has nothing to do with the case because they can only hear it, but they cannot make a decision. "It will not affect our case." The trio launched the appeal earlier this year.

In emotional appeals to the Denpasar District Court in June, they finally admitted their roles in the failed bid to smuggle heroin from Bali into Australia.

During the hearings, defence lawyers argued they should have faced charges under drug possession laws, which carry a maximum penalty of 10 years in jail, rather than drug export laws, which allow for death.

The appeal is the trio's final bid to beat the death penalty, other than an appeal to Indonesia's president for clemency.

Three other Australians facing the death penalty over the plot - Scott Rush, 21, and ringleaders Andrew Chan, 23, and Myuran Sukumaran, 26 - have also launched challenges, arguing Indonesia's Constitutional Court should scrap the death penalty because the nation's constitution affords life as a basic right. The case is due to resume in Jakarta next week, with a decision some weeks away.

Meanwhile, there could also be some movement in the cases of the remaining three members of the Bali Nine who are not facing death. Lawyers for Michael Czugaj, 22, and Martin Stephens, 31, said they would soon make a decision on whether to launch a final appeal against their life sentences.

"Next week I'm going to meet (Stephens's) family in Bali, and I'm going to see the situation for the judicial review," his lawyer Wirawan Adnan said. Czugaj's lawyer Frans Passar also confirmed his client was also weighing an appeal.

The only female in the group, Renae Lawrence, has ruled out an appeal against her 20-year term, but could have her sentence shaved by one or two months to mark Indonesia's Independence Day holiday on Friday.

Under the Indonesian system, all prisoners are eligible for remission on Independence Day and some religious holidays, if they have served at least six months of their sentence and are not sentenced to either life in prison or death.



Union to take NSPS case to Supreme Court
Lawyer Blog News | 2007/08/14 18:59
Officials of the American Federation of Government Employees (AFGE) said today they would file an appeal with the U.S. Supreme Court to stop the Defense Department from implementing portions of the National Security Personnel System (NSPS). The officials announced their plans after the U.S. Court of Appeals denied on  Aug. 10 a motion by AFGE and the United Department of Defense Workers Coalition for an en banc, or full court, review of the court's earlier decision upholding NSPS regulations and overturning a lower-court ruling.

AFGE expects this week to file a motion to stay the issuance of the appeals court’s mandate in the case and within 90 days proceed with a petition to ask the Supreme Court to take the case, officials said.

“AFGE has been presented with the opportunity to bring this issue to the honorable justices of the U.S. Supreme Court and will face this head on,” John Gage, AFGE national president, said in a statement. “The [Bush] administration and DOD need to be taken to task on this issue. It’s time to stop the bullying and abuse this administration is directing toward DOD employees.”

Gage added that if NSPS were to be fully implemented, DOD workers “would be subjected to an arbitrary, dishonest and unfair working atmosphere.”

A series of court decisions on NSPS began in February 2006, when a ruling by U.S. District Court Judge Emmet Sullivan gutted NSPS provisions that related to labor relations, collective bargaining, independent third-party review, adverse actions and DOD’s proposed internal labor relations panel. However, on May 18, the Court of Appeals upheld the regulations in a 2-1 decision.


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