Tuesday, August 28, 2007

Legal Blog Watch

Legal Blog Watch

Yahoo Moves to Dismiss Lawsuit for Aiding and Abetting Torture

Can a U.S. court punish a U.S. company for alleged human rights violations committed abroad? That's one of the major questions at issue in a lawsuit filed against Internet giant Yahoo on behalf of several pro-democracy writers in China, who claim that Yahoo's release of their personal user information to the Chinese government lead to their imprisonment and torture. Not surprisingly, the suit was filed in the United States, not China -- and yesterday, Yahoo moved to dismiss the suit, according to this article in the Washington Post (8/28/07). Yahoo admitted that it released information about the writers, but defended its decision as necessary to comply with China's request, which was lawful. Yahoo's opponents question whether China could lawfully request this information, but argue that even if it could, Yahoo is obligated to follow U.S. and international legal standards when it does business abroad, which would have prohibited release of this information. 

To read more on the Yahoo lawsuit and view some of the filed documents, visit this link at Rebecca McKinnon's RC Conversations Blog.

Posted by Carolyn Elefant on August 28, 2007 at 04:32 PM | Permalink | Comments (0)

GC Mike Dillon, Out of Context

About a week ago, we posted here about how more and more lawyers' billing rates are breaking the $1,000/hour barrier. We also referenced a quote from Sun GC

Mike Dillon in the Wall Street Journal article on billing rates as saying that he didn't believe that charing $1,000 an hour for legal services was inherently unreasonable. At least one law blogger took Dillon to task for his comment. As for me, I didn't view Dillon's remarks as outrageous (as I noted, if a lawyer can dispose of a case with a 60-minute, thousand-dollar-an-hour phone call, then he deserves that rate). But the quote struck me as odd for someone who'd authored a classic blog post like The Way of the Mastodon, which makes the point that in the Internet Age, corporate clients can locate more competitive options for legal services and need not remain captive to Biglaw's increasing rates.

Dillon doesn't deny the comment, but he does explain it further in this blog post. He writes:

I did state and I do believe that there may be times when a $1,000/hour fee is warranted. If you are embroiled in a complex, "bet the company" type of litigation, most GCs will happily pay this hourly rate - provided the value received is commensurate with the fee. This means the services of an attorney with very specific and unique skills, plenty of experience, and the ability to quickly drive a high exposure problem to a favorable resolution.  The reality is that most companies will rarely, if ever, require these types of legal services.  Most of my discussion with the reporter focused on the larger issue, which is the economic misalignment between traditional firms and their corporate clients. I also shared with the reporter some of the things we are doing at Sun to reduce the impact of this misalignment.

Dillon goes on to write that he doesn't mind that the reporter didn't write about Sun's measures to contain legal costs because the reporter had a different focus for the story. However, Dillon concludes that "context is everything and having a blog is a great way to provide it."

Posted by Carolyn Elefant on August 28, 2007 at 04:30 PM | Permalink | Comments (0)

Are Law Firm Layoffs Coming Soon?

As the economy declines, will we see a repeat of the associate layoffs that we saw in the late 1980s following  Black Monday, the early 1990s following the savings-and-loan scandals and again in the 2002 with the burst of the dot-com bubble? That's the question that Gina Passarella explores in this article, With Dip in Economy, Are Associate Layoffs on the Horizon? (The Legal Intelligencer, 8/28/07). According to the article, some law firm leaders are predicting layoffs in areas like structured finance, real estate and corporate mergers and acquisitions. Others speculate that any downturn will be offset by the growth of practice areas like bankruptcy and litigation. 

And how will the changing market impact associates? Duane Morris Chairman Sheldon Bonovitz is quoted in the article as saying that layoffs are a possibility in some fields. But others are more optimistic, pointing out that corporate attorneys are in high demand, and it is unlikely that any will be laid off should the economy take a turn for the worse.

At the WSJ Law Blog, commenters share their predictions here. Some predict that small and midsize firms, which are less diverse than large firms, will take a bigger hit. And others remarked how talk of doom and gloom has quelled talk of $190,000 salaries for first-years at New York firms.

Greg Bowman at the Law Career Blog discusses the impact on associate salaries here. Bowman notes that law firms won't lower salaries as a result of expected downturn, but instead, will simply stop upping them annually. And he notes that since firms have already been cautious about hiring associates, when the economy does turn around (as it always has historically), those associates who remain employed will be very busy.

  Finally, over here, the Estrin Report theorizes that paralegals will be hit hard as well:

While the Pollyannists who in the last downturn predicted an opportunity for bankruptcy and litigation practices predicted the same opportunity for this upcoming downturn, no one seems to realize that those corporate paralegals trained in M&A are most likely NOT trained in bankruptcy or litigation.

Consequently, Estrin recommends that paralegals should acquire cross training in a recessionproof practice specialty outside of the corporate area -- and should start doing so now, before "the other shoe drops."

Posted by Carolyn Elefant on August 28, 2007 at 04:28 PM | Permalink |

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