Judicial Notice: March 6, 2021

Notable legal news from the week that was.

Welcome to Original Jurisdiction, the latest legal publication by me, David Lat. You can learn more about Original Jurisdiction by reading its About page, you can reach me by email at davidlat@substack.com, and you can register to receive updates on this signup page.

Last week was dominated by two things for me: the never-ending mortgage underwriting process, with responses to inquiries just begetting more inquiries, and receiving the Covid-19 vaccine.

I have asthma, one of the underlying health conditions currently recognized in New York State as qualifying a person to receive the Covid vaccine. In the years leading up to 2020, my asthma didn’t bother me much. But last year this month, Covid-19 sent me to the hospital for 17 days, including 6 days on a ventilator, and my doctors believe my asthma contributed to the severity of my case.

I asked my internist if I should get vaccinated, and he said absolutely, in light of both my asthma and past Covid experience (plus increasing cases of reinfection, including that of a man in France with a history of asthma who got reinfected and wound up hospitalized in critical condition). So I got the first shot of the Pfizer vaccine on Monday. On Tuesday, I had a strong reaction — fever, fatigue, aches — but by the end of the week, I was fine. I urge all of you to get vaccinated when you can.

Now, on to the news.

Lawyer of the Week: Vernon E. Jordan Jr.

Lawyers were all over the headlines in the past week. For example:

  • Lawrence Otis Graham, the celebrated Black lawyer turned writer, who passed away recently at the age of 59;

  • Neera Tanden, whose nomination to lead the Office of Management and Budget was withdrawn at her request after controversy erupted over her “mean tweets”;

  • Vanita Gupta, nominated to serve as associate attorney general (the #3 job at the Justice Department), whose nomination is also generating controversy (but also some conservative support, interestingly enough); and

  • Kade Crockford, whose work for the ACLU helping Massachusetts craft thoughtful laws governing the use of facial recognition technology was recently highlighted by Kashmir Hill in the New York Times.

I feel fairly confident in my winner, though: Vernon Jordan, who passed away on Monday at the age of 85. As noted in his Times obituary, Jordan was a “civil rights leader and Washington power broker whose private counsel was sought in the highest echelons of government and the corporate world.” And his incredible career, including four decades at Akin Gump, was all the more impressive considering the discrimination he faced as a Black man in America.

You can read about Jordan’s remarkable life and career in his New York Times and Washington Post obituaries, as well as this eloquent remembrance by Robin Givhan, a friend of his. I’d also like to share a personal perspective from noted broadcast journalist Alice Travis (sent to me by a relative of hers who is a reader of Original Jurisdiction):

Rightfully celebrated for his advocacy and behind-the-scenes influence, Vernon Jordan leaves a profound legacy in politics, law, and business. He deserves equal remembrance as a man. As likable as he was powerful, he was one of the finest human beings I ever have known. Without recognition and in exchange for nothing, Vernon always could be counted on to lend a hand, to do a favor, to open a door, or to hold open the door of opportunity.

In June 1976, when Barbara Walters exited The Today Show, as a young television journalist, I was one such beneficiary. Vernon went straight to the top and arranged for me, a mere acquaintance, to meet not once but twice with the top NBC brass who would sign off on the new hire. It was a different world then, being of color was not to the advantage of a journalist, and I did not secure the role, but Vernon had interceded knowing thinking would change and talent would triumph.

Vernon Jordan, rest in peace.

Judge of the Week: Judge Peter W. Hall.

As I’ve mentioned before in these pages, repeat wins are possible but disfavored, especially within a short span of time. So I’m passing over Justice Amy Coney Barrett, who was JOTW just last month, even though Justice Barrett issued her first signed majority opinion for the Supreme Court on Thursday. As noted by Robert Barnes of the Washington Post, it’s customary for a justice’s first opinion to be lopsided or even unanimous in the vote, and Justice Barrett’s concise, 11-page opinion for a 7-2 majority in U.S. Fish and Wildlife Service v. Sierra Club was no exception. It’s about the scope of the deliberative process privilege under FOIA — yes, I know, I lost you at “FOIA” — but if you want to read more, Howard Bashman has collected copious coverage over at How Appealing.

I also considered Judge Claudette White, praised in her New York Times obituary as an “innovative tribal judge” for “calling out injustice since the third grade.” A member of the tribal council of her Quechan tribe of Southern California, as well as a former chief judge for the San Manuel Band of Mission Indians, Judge White passed away last month at the age of 49 from Covid-19. May she rest in peace.

For JOTW, though, I’m going with Judge Peter Hall (2d Cir.), who made news by announcing his decision to retire from active service and take senior status. This is significant because, combined with other recent retirement announcements from Judges Robert A. Katzmann (who went senior in January) and Denny Chin (who will go senior in June), President Biden now has the opportunity to flip the Second Circuit back to a Democratic majority. As Professor Carl Tobias, a prominent scholar of the federal courts, told Bloomberg Law, “It’s a big deal because the Second Circuit is so important.” Headquartered in Manhattan, the court hears many high-profile criminal and civil cases, including a disproportionate number of landmark cases in banking and securities law.

Who’s in the running for Second Circuit seats? The jurists mentioned by Professor Tobias — Judges J. Paul Oetken, Alison J. Nathan, and Jesse M. Furman (S.D.N.Y.), and Judge Pamela K. Chen (E.D.N.Y.) — are all highly respected trial judges who would be excellent additions to the court for the two New York seats. But in Judge Hall’s case, because he occupied the “Vermont seat,” the nomination will go to someone from the Green Mountain State. If you have thoughts on possible Vermont nominees, please email me.

[UPDATE (8:30 p.m.): The two preceding paragraphs were edited (1) to add details regarding when Judge Katzmann went senior and Judge Chin will go senior, and (2) to clarify the regional allocation of the three seats in question — two for New York, and one for Vermont. Pursuant to 28 USC § 44(c), the Vermont seat must be filled by a Vermonter.]

Ruling of the Week: Chevron Corp. v. Donziger.

Speaking of the Second Circuit, on Thursday the court issued its latest ruling in Chevron Corp. v. Donziger, the long-running, closely watched legal battle between oil giant Chevron and lawyer Steven Donziger, who filed a class-action lawsuit against Texaco back in 1993, alleging that Texaco’s oil drilling in Ecuador caused massive pollution that harmed indigenous communities in the Amazon. (Chevron is now the defendant because it acquired Texaco in 2001; Texaco operated the Lago Agrio oil field from 1972 to 1993.)

As Judge Gerard Lynch explains in his opinion, the current appeal is not about the underlying environmental litigation:

Rather, the three pending appeals relate to a subsequent civil Racketeer Influenced and Corrupt Organizations (“RICO”) suit in which the United States District Court for the Southern District of New York (Lewis A. Kaplan, J.) found that the Donziger Defendants and a group of Ecuadorian residents conspired to procure [a multibillion-dollar Ecuadorian] judgment [against Chevron] through illegal means.

As noted by Judge Lynch, those means included “brib[ing] the presiding judge to enter a judgment in his clients’ favor in exchange for $500,000 of the judgment’s proceeds; coerc[ing] the court to appoint a hand-picked expert whom Donziger paid for favorable testimony; and ghost-wr[iting] the Ecuadorian Judgment ‘in whole or in major part’ with only ‘light editing’ by the judge who signed it.”

But this appeal is also not about the merits of the RICO case, which the opinion notes “has been authoritatively resolved against Donziger.” Judge Kaplan ruled against Donziger after a seven-week trial, the Second Circuit affirmed, and the Supreme Court denied certiorari. (Donziger was also disbarred by New York State last year, so state courts haven’t been kind to him either.)

What is the instant appeal about? A few things: a challenge by Donziger to the award of costs to Chevron, various contempt rulings against him, and the award of sanctions and attorneys’ fees to Chevron. On contempt, the main issue is whether Donziger violated Judge Kaplan’s injunction against profiting from the fraudulently procured Ecuadorian judgment when he sold interests in the Ecuadorian judgment to at least six investors for $1.2 million, then paid himself with the proceeds.

As summarized by Jonathan Stempel of Reuters, the Second Circuit “largely upheld” Judge Kaplan’s rulings against Donziger, “but narrowed the scope of a 2019 civil contempt finding” against him. The ruling was mixed enough that both Team Chevron and Team Donziger claimed victory. (Thomas Hungar of Gibson Dunn, Chevron’s longtime counsel in this litigation, represented the company before the Second Circuit, while Donziger proceeded pro se.)

It will be interesting to see what effect, if any, the Second Circuit’s latest decision might have on the related prosecution of Donziger on criminal contempt charges, which is also making news. As Jason Grant recently reported for Law.com, more than 300 law students are protesting Seward & Kissel, boycotting the firm’s recruiting process because of the firm’s role in serving as court-appointed prosecutor in Donziger’s criminal contempt case.

Runner-up: The Williams Companies Shareholder Litigation. As noted by Andrew Ross Sorkin and the team over at DealBook, this was “the first time in more than two decades that the influential Chancery Court, which presides over most disputes in corporate America, invalidated a poison pill adopted by a public company.” Congratulations to Bernstein Litowitz, Grant & Eisenhofer, and Friedman Oster & Tejtel, counsel to the plaintiffs.

But don’t despair, defense lawyers. As pointed out by several law firm client memos (such as this Paul, Weiss memo), the pill in question here “had a package of novel features,” including a five percent trigger, that collectively constituted what Chancery viewed as an “extreme” poison pill.

[UPDATE (3/20/2021): I’m not sure how I missed this, but one of the biggest jury verdicts in recent history was awarded on March 2 in VLSI v. Intel: a whopping $2.175 billion, in favor of VLSI and against Intel, for patent infringement. Congratulations to Irell & Manella and Mann Tindel Thompson, counsel to VLSI.]

Litigation of the Week: Brnovich v. Democratic National Committee.

In Judicial Notice, I sometimes like to go with “interesting” over “important” when it comes to my awards. But sometimes important is too important to be denied.

On Tuesday, the Supreme Court heard oral argument in the consolidated cases of Brnovich v. Democratic National Committee and Arizona Republican Party v. Democratic National Committee, which challenge two election restrictions in Arizona. Adam Liptak of the New York Times described Brnovich as the Court’s “most important voting rights case in almost a decade.” Dean Erwin Chemerinsky, writing for the ABA Journal, declared that “how the court decides these cases could have a profound effect on what state laws are enacted and allowed with regard to voting, and who votes and how elections are conducted for many years to come.”

In a February 16 letter to the Court, deputy solicitor general Edwin Kneedler advised the justices that the Biden Administration “does not disagree” with the Trump Administration’s ultimate conclusion that the challenged provisions don’t violate Section 2 of the Voting Rights Act. But the new administration does disagree with — and disavows — the analysis previously proffered by the former administration.

And as Ruth Marcus explained in the Washington Post, it’s the analysis that’s key; “the significance of the case will be in what standard the court adopts for how to apply Section 2 — which has been most often interpreted in the context of racial gerrymandering — to claims of discriminatory voting practices.” With more voting laws (and challenges to voting laws) in the pipeline, which will further fuel the trend of elections becoming more contested and contentious, the analytical framework for the Voting Rights Act matters more than ever.

Deal of the Week: Apollo’s acquisition of Michaels.

In terms of the “coolness” factor, it would be hard to beat the acquisition of a majority stake in Tidal — the streaming music service owned by Jay-Z, Beyonce, and other celebs — by Square, the mobile payments company owned by Jack Dorsey, the billionaire co-founder and CEO of Twitter and a celebrity in his own right.

Jay-Z: he’s not a businessman, he’s a business, man! He will also join the board of Square, which is noteworthy.

But in terms of the value of the deal, it was for “only” $297 million — enough for Hova and Queen Bey to dine at Red Lobster, but not nearly enough to make him a Black Bill Gates in the making. And it’s not even that big a sum by the standards of Biglaw dealmaking, although I’m sure the law firms involved — Gibson Dunn for Square, Reed Smith and Cummings & Lockwood for Tidal — are pretty thrilled to be working on this matter (especially if they got to Zoom with either Jay-Z or Jack Dorsey at any point).

For Deal of the Week, I’m therefore going with something that has a bigger dollar value and a current-events hook: Apollo Global Management’s acquisition of Michaels, the crafts retailer that’s a strip-mall staple, for $5 billion.

What’s the current-events hook? During the pandemic, with millions of Americans stuck at home and bored out of their minds, crafting became an even more popular pastime — and Michaels benefited, seizing the opportunity to launch same-day delivery and curbside pickup services.

The stock price of Michaels also benefited, rising by over 300 percent over the past year. The Apollo deal, if it goes through, will offer an additional premium. If it doesn’t go through, shareholders might get an even better deal; the Apollo agreement includes a 25-day “go-shop” period, during which Michaels can entertain other suiters.

Congratulations to the lawyers and law firms involved (per Law.com):

Michaels, which is based in Irving, Texas, was represented by a Ropes & Gray team led by partners Will Shields, Craig Marcus, Sarah Young and Will Michener. Latham & Watkins represented UBS Group, which acted as financial adviser to Michaels. Apollo was advised by Simpson Thacher & Bartlett and Paul, Weiss, Rifkind, Wharton & Garrison. The Simpson Thacher team included M&A partners Gregory Klein, Michael Kaplan and Atif Azher.

All four firms are noted for their expertise in private equity M&A — showing the advantages of sticking to your knitting.

Law Firm of the Week: Davis Polk & Wardwell.

Yes, Davis Polk was LFOW back in January. But what it did last week definitely merits a repeat win.

As first reported by Above the Law, Davis Polk — in order to “celebrate the hope of this upcoming spring,” as managing partner Neil Barr wrote in his announcement email — showered its associates with gifts. More specifically, in recognition of its associates’ “resiliency during this trying time” and “commitment to client service,” DPW allowed them to choose from such thoughtful gifts as an excursion for two (outdoors, of course); fitness equipment (since many gyms are closed during the pandemic); and wine and culinary packages (because we all could use more booze and food right now). Associates could choose from more than a dozen different packages, with an estimated value of at least $1,500.

Not surprisingly, many other Biglaw firms quickly followed suit, including Akin Gump, Debevoise & Plimpton, Latham & Watkins, Shearman & Sterling, Simpson Thacher, Sullivan & Cromwell, and Willkie Farr (per Meghan Tribe of Bloomberg Law). But on something like gifts (as opposed to bonuses), where it’s really the thought that counts (as opposed to the dollar amount), Davis Polk still gets special credit.

Of course, we all recall how Davis Polk established the special-bonus scale of $7,500-$40,000 that wound up being the industry standard last year. Look for DPW to become an even hotter firm come recruiting time, if that’s even possible, and maybe to inch up a few spots in the next Vault rankings.

Lateral Move of the Week: Latham & Watkins hiring Ian Conner.

During the pandemic, lateral hiring out of government slowed significantly. Many firms were unwilling or unable to make the investment required in hiring government lawyers. Because these attorneys don’t come with clients, hiring out of government requires strategic vision and a willingness to wait — a year, 18 months, two years — while the new partner builds her practice. Many firms, lacking the vision, patience, or pocketbook, prefer to hire partners with portable practices, who (in theory) can be accretive pretty much from the get-go.

So kudos to Latham & Watkins for hiring Ian Conner, who most recently served as Director of the Bureau of Competition at the U.S. Federal Trade Commission (and who served at the DOJ’s Antitrust Division earlier in his career). Antitrust is an extremely “hot” area right now, and a high-level FTC official like Conner is quite a catch. Conner will join the firm’s D.C. office as a partner in the Litigation & Trial Department, as well as a member of the Antitrust & Competition Practice. Per Dylan Jackson of Law.com, Conner joins a number of government alums at Latham, including fellow FTC alumni Amanda Reeves and Alan Devlin.

Considering that 2020 was a much stronger year for law firms than many expected, perhaps more firms will follow Latham’s lead and restart or increase their hiring out of government. With regulation and enforcement likely to increase on multiple fronts during the Biden Administration, law firms need to be ready to help their clients navigate the coming challenges.

Welcome to Original Jurisdiction, the latest legal publication by me, David Lat. You can learn more about Original Jurisdiction by reading its About page, you can reach me by email at davidlat@substack.com, and you can register to receive updates on this signup page.