Judicial Notice (10.27.24): Money Talks

Susman’s $1.6 billion win, Kobre’s $605 million jury verdict, possible AG picks for Donald Trump, and a prominent litigator turned NYC mayoral candidate.

Judge Amul Thapar of the Sixth Circuit, delivering the 2024 Joseph Story Distinguished Lecture at The Heritage Foundation (screenshot via YouTube).

Welcome to Original Jurisdiction, the latest legal publication by me, David Lat. You can learn more about Original Jurisdiction by reading its About page, and you can email me at davidlat@substack.com. This is a reader-supported publication; you can subscribe by clicking here.

It’s hard to believe that Halloween is just a few days away. Our son Harlan, 7, is going as a pirate, while we’re stuffing Chase, 15 months, into a (super cute) tiger costume.

I’m generally not that into Halloween. But if I were, maybe I’d dress up as a McDonald’s employee, in light of the recent controversy—over whether or not Kamala Harris worked at Mickey D’s, not the food-poisoning litigation. Toiling under the golden arches is a role I know well, having worked at McDonald’s during the summer of 1992—and yes, I can prove it.

Now, on to the news.

Lawyers of the Week: Jacob Buchdahl, Elisha Barron, Tamar Lusztig, and Stephanie Spies.

Last year, litigation powerhouse Susman Godfrey secured a $787.5 million settlement for its client, Dominion Voting Systems, in Dominion v. Fox. The contingency fee it earned in that case, which I estimated to be a little more than $100 million, helped Susman snag the #4 spot in profits per equity partner in the Am Law 100. But the monumental win—and mammoth fee—set up a challenge for Susman: could it replicate such performance in 2024?

Here’s something that might help: Susman won a $1.6 billion verdict for the plaintiff in BML Properties Ltd. v. China Construction America Inc. After an 11-day bench trial, Justice Andrew Borrok of New York Supreme Court (Commercial Division) ruled in favor of BMLP, the developer of a Bahamian casino resort, and concluded that CCA, a Chinese contractor hired to work on that resort, engaged in fraud “established beyond doubt.”

And while I’m not privy to Susman’s fee arrangement with BMLP, I’m guessing the firm will be taking home another nine-figure fee, given its focus on contingency cases with the potential for huge verdicts. Kudos to the trial team of Susman partners Jacob Buchdahl, Elisha Barron, and Tamar Lusztig; associate Stephanie Spies; and Susman’s co-counsel, Mark Zauderer and Jason Cohen of Dorf Nelson & Zauderer.

Of course, Dominion was resolved through a settlement, while BML involves a judgment—one that CCA, represented by Debevoise & Plimpton, might appeal. So Susman’s victory here is not yet final—just as it wasn’t in the NFL “Sunday Ticket” antitrust litigation, where Susman won a $4.7 billion jury award that the judge subsequently tossed (in a ruling the firm is now appealing). But $1.6 billion is a big, big number—it could get reduced on appeal, or the parties could settle for a smaller amount, and the Susman lawyers could still make out like bandits. Expect the culinary offerings at Susman’s Manhattan holiday party to be extra special this year.

Other lawyers in the news:

• Congratulations are also in order for Michael Ng, Daniel Zaheer, and their trial team at Kobre & Kim. They won a $605 million jury verdict for their client, California low-carbon fuels retailer Propel Fuels Inc., in a trade secrets case against Phillips 66 Co.

• But again, remember that it ain’t over until all appeals are exhausted (or the case gets settled). Talented appellate attorneys can work wonders—as Paul Clement of Clement & Murphy and Kannon Shanmugam of Paul Weiss did in securing an Eleventh Circuit reversal of a $440 million judgment against four major cruise lines in a case involving the Helms-Burton Act, a (rather obscure) federal law concerning the U.S. embargo against Cuba.

• I didn’t receive any responses to last week’s request for insight into the mindset of big-time tax evaders. But based on the case of former Moody’s general counsel John Goggins—sentenced on Thursday to eight months in prison for failing to file federal income tax returns for four years, during which he earned $54 million—I’m guessing that mental-health challenges are often involved.

• If you share my fascination with Usha Vance, former Munger Tolles associate and possible future Second Lady, then check out Irin Carmon’s profile of Usha for New York Magazine (in which I’m quoted a few times).

• Speaking of a second Trump administration, who might serve in leading roles at the White House Counsel’s Office, U.S. Department of Justice (DOJ), and other federal agencies? According to ABC News, contenders for attorney general include former SEC chairman Jay Clayton, Judge Aileen Cannon (S.D. Fla.), former DOJ official Jeff Clark, former White House lawyer Mark Paoletta, and former Senate Judiciary Committee lawyer Mike Davis. Other contenders for top jobs include Steve Engel, former head of the DOJ’s Office of Legal Counsel, and Will Levi, former chief of staff to attorney general Bill Barr. (On the AG pick, Ken White suggested on Serious Trouble that while Judge Cannon might be “extreme,” she’s not “Jeffrey Clark extreme”—and someone like Clark might be more along the lines of what Trump is looking for this time around, assuming Clark can win Senate confirmation.)

• And speaking of lawyers and politics, Jim Walden of Walden Macht Haran & Williams—described by The New York Times as “a prominent and well-regarded lawyer, who has represented causes across the political spectrum”—is running to succeed the embattled Eric Adams as New York City mayor.

Judge of the Week: Judge Amul Thapar.

What can be done to bring a greater respect for free speech and intellectual diversity to American law schools? One claim that Judge James Ho (5th Cir.) makes in defense of his controversial clerk hiring boycotts is that there aren’t effective alternatives.

According to another leading conservative jurist and fellow Supreme Court shortlister in a second Trump administration, Judge Amul Thapar (6th Cir.), there are other options. He made his case while delivering the 2024 Joseph Story Distinguished Lecture at the Heritage Foundation, “Why Originalist Courts Need Originalist Classrooms”—which you can watch in its entirety on YouTube or read about in Bloomberg Law, The National Law Journal, and Reuters (with thanks to Howard Bashman of How Appealing for all the links).

In a nutshell, Judge Thapar argued that all too many law professors are “overwhelmingly anti-originalist” and “teach widely accepted originalist methods through a distorted, uncharitable and often inaccurate lens.” This slanted teaching has a negative effect in the world beyond law school because the students of these professors, after they graduate and become law clerks, are poorly equipped to advise judges—especially district or trial-court judges—on how to apply originalism.

But the situation might improve, Judge Thapar continued, if “taxpayers and donors alike demand it.” If taxpayers, who help support public law schools, and donors, a major financial resource for private law schools, threaten to withhold or actually withhold funds from schools that do a poor job of teaching originalism, we’d likely see positive change—because in legal academia, as in so many other sectors, “money talks.”

Over at The Volokh Conspiracy, Professor Josh Blackman opined that Judge Thapar’s approach “will have a negative impact on many innocent actors” because law students “have little control over what is taught, yet they will likely feel the brunt of any cut in funding.” While that’s true to some extent, I’d argue that clerk hiring boycotts harm innocent actors—mostly students—to a greater degree than funding cuts. A cut in overall funding for a law school affects not just students, but (highly paid) faculty members and administrators, including deans. But a clerk hiring boycott is felt most heavily by students—especially conservative students interested in clerking for conservative judges, who are so far the only participants in these boycotts. So if forced to choose, I’d favor wielding the power of the purse over clerk hiring boycotts (but of course one can argue that both strategies can be used).

In nominations news, confirmations will have to wait until the Senate returns after the election, but the Biden administration did name its fifty-fourth round of judicial nominees, two trial-court picks in California: Magistrate Judge Benjamin Cheeks (S.D. Cal.) and Los Angeles Superior Court Judge Serena Murillo (C.D. Cal.).

As for what will happen to the federal judiciary over the longer term, that will of course depend on what happens on Election Day. In this Times article (gift link), Mattathias Schwartz and June Kim take a deep, data-filled dive into how Donald Trump and Joe Biden have reshaped the federal judiciary by appointing, between the two of them, around half of all federal judges. Here’s the tidbit from the piece that I found the most notable: “Mr. Biden’s judges, on average, were somewhat more liberal than those nominated by his Democratic predecessors. Mr. Trump’s judges were, on average, ideologically similar to those nominated by previous Republican presidents.”

Ruling of the Week: Al Otro Lado v. Executive Office for Immigration Review.

Donald Trump has reportedly told advisors that immigration is the #1 issue in this election. And although polling suggests that the top concern of voters is actually the economy, immigration is up there.

So let’s talk about immigration—specifically, an opinion by a divided panel of the Ninth Circuit that raises an interesting issue of statutory interpretation. And if Trump wins the election and reverses some policies of the Biden administration, this ruling could have significant real-world implications as well.