Supreme Court Disappoints Secured Lenders
June 25, 2004
The U.S. Supreme Court's recent <i>Till</i> decision on the proper cramdown interest rate will disappoint secured lenders. <i>Till v. SCC Credit Corp.</i>, 124 S. Ct. 1951 (2004). As we show below, Till should be limited to its narrow fact pattern, but is still bad news for lenders. They now will be forced to fight an uphill battle to prove that a higher risk premium should be added to the prime rate applicable to their crammed down secured claim. In Till, the plurality accepted a risk adjustment premium in the range of 1% to 3% (Justice Thomas, concurring, could accept no premium at all). Commercial lenders will thus have to overcome Till by showing that they are entitled to a truly "market" interest rate.
What Constitutes a 'Security'?
June 22, 2004
The definition of what constitutes a "security" has broadened and changed dramatically over the years under both case and statutory law. Attorneys concentrating in securities law (whether by virtue of litigation or transactional work), as well as governmental and self-regulatory organizations, ranging from the Securities and Exchange Commission (SEC) to the National Association of Securities Dealers (NASD) to various exchanges, have been dealing with the increasingly complex question of what constitutes a "security." This question is often posed to resolve particular claims in specialized venues, testing the acumen of even the most sophisticated securities practitioners and industry members. This two-part article describes the transfer process and offers sample forms as examples.
Multiple-Currency Operation: Challenges and Advantages
June 01, 2004
With more U.S. law firms serving ' or becoming ' global enterprises, many readers will need to gain new fluency in dealing with foreign currencies and exchange-rate issues. Before you immerse yourself in technical details, here's a preview of some practical issues you may encounter and some business advantages you might seek.
Accounting Mismatch Spins Accrual Fate for Merger Deal
June 01, 2004
Last month's edition featured a new book excerpt on resolving balance sheet issues in law firm mergers. This recent news report on Pennie & Edmonds underscores the potentially extreme challenges of harmonizing disparate accounting systems.
Billing Basics Revisited: Write-downs and Collections
June 01, 2004
While A&FP regularly seeks to explore new and advanced profitability techniques, the wide experience of our authors regularly confirms the vital need to keep an eye on basics. It's been some time since we revisited these particular perennials in the profitability garden. Our Editorial Board member Bill Brennan's review clarifies their importance and provides some fresh insights
Law Firm Performance Metrics: Broadening Our Discussion
June 01, 2004
Last month's medley of views on law firm ranking metrics, while diverse, by no means exhausted what <i>A&FP</i> Board members and other contributors have to say about this important subject. The following two mini articles continue to address ranking-related problems, but will also help us broaden the scope of our discussion.
It's Back To Playing By The Rules: Sec. 412(i) Retirement Plans
June 01, 2004
A common expression in the tax arena is the "red flag" ' the concern that a tax deduction is so large, or the tax benefits of a transaction are so favorable to the taxpayer, that it is comparable to waving a red flag at the IRS, inviting scrutiny and possible adverse consequences. Over the past few years, certain retirement plans created under the provisions of Section 412(i) of the Internal Revenue Code have been designed using methods that are questionable, at best, in terms of compliance with the tax code and regulations. This problem became so pervasive that it was widely anticipated the IRS would respond to the red flags, and put an end to the abuses. Last month, it happened. IRS guidance and proposed regulations were enacted to try to get everyone to play by the rules. Not that the rules are bad; a 412(i) plan could still be right for you.
AHLA Seeks Clarification on Malpractice Insurance
May 28, 2004
<b>Part One of a two-part article</b>. Proper malpractice coverage is essential to any physician's practice. When that coverage is not readily available or premiums skyrocket, that essential can seem like a luxury. Physicians facing other economic pressures in their practice not infrequently opt to reduce their insurance limits, increase their deductible, drop their coverage altogether, retire or leave the area, or discontinue what they view as high-risk portions of their practice (eg, serving on ER call rosters or accepting Medicaid or indigent patients). As a result, physicians' personal assets (and careers) are more at risk, hospitals face more liability exposure as the "deep pocket," and patients face significantly reduced access to care.
Anti-Spam Law Impacts Legitimate e-Mail
May 26, 2004
Despite its clever name, the recently enacted CAN-SPAM Act does not in fact prohibit "spam." What the law does do is regulate "commercial e-mail," which is defined broadly. Accordingly, the legal department of every business that uses e-mail should be advising its employees to take immediate steps to comply with the Act, as violations carry stiff penalties.
