An Unexpected Evidentiary Battleground: The 'Causation' Element in Consumer Protection Claims
October 01, 2003
Ordinarily, the focus in a product liability case is on the defendant-manufacturer's duty to design and manufacture a safe and useful product and to warn adequately of any risks associated with its use. But an interesting and unexpected battleground can arise from a tag-a-along consumer protection claim. Here is the scenario: Plaintiff, in an individual action, sues defendant-manufacturer for injuries allegedly sustained in connection with the use of defendant's product. Plaintiff sues under traditional product liability theories as well as under the state's consumer protection statute, which proscribes deceptive and misleading trade practices. In particular, plaintiff alleges a consumer fraud has occurred because she has been injured by a product that, she claims, had been sold in connection with deceptive sales practices; in this case, certain allegedly false or misleading advertisements.
Leadership Transition in a Law Firm
October 01, 2003
How does a law firm transition leadership from the founders or the current set of leaders to the next generation of leaders? There are three models of transition: King to Prince, CEO with credibility to COO with credibility and accepted founder/leader to people who should become leaders. Obviously the last model is the most difficult to execute. The approach for this transition model is also applicable to the first two. The King to Prince will probably not make the transition because benevolent despotisms crash if the Prince has not gone through a credibility building process. The CEO to the COO assumes the COO has gone through the process outlined below.
Warning Signs: How to Spot Partner Dissatisfaction and What to Do About It
October 01, 2003
By no means do the economic stability and steady growth of a legal practice ensure harmony in the partner ranks or, for that matter, the contentment of any single lawyer. Managing partners who breathe too easily when reassuring revenue or profit numbers get posted may endanger their firms by ignoring tell-tale signs of disharmony. Law firms have been known to go out of business amid strong financials just as precipitously as when those numbers tumble. Remember Shea & Gould?
Around the Firms
October 01, 2003
Attorney movement among major law firms and corporations.
Do Contractors Make the Best Firm 'Employees'?
October 01, 2003
Any personnel professional will remind us that finding the right person for a niche position is difficult at best. Carefully weighing the dictates of a job, the necessary skills and salary limitations can be a daunting task, especially in the legal field. As alternatives to "employment," there are several ideas that warrant a discussion.
Understanding Equitable Distribution
October 01, 2003
As the definition of marital property continues to expand and embrace more and more esoteric forms of property, equitable distribution cases become increasingly…
'Faithless Servant' Must Surrender All Income
October 01, 2003
The Second Circuit, in a rare venture into the realm of damages resulting from a breach of the duty of loyalty, has ruled that a "faithless servant" must surrender all income, including investment opportunities, after the date the disloyal acts began.
Private Leasing Companies Can't Ignore Sarbanes-Oxley
October 01, 2003
According to AMR Research, which recently surveyed 60 Fortune 1,000 companies, it is estimated that the Fortune 1,000 will spend $2.5 billion in 2003 alone in costs associated with Sarbanes-Oxley Act compliance. How much more will be spent by smaller public companies and by those in the private-company sector is a mystery, but the total costs - in cash, time, consulting fees, lost opportunities, and human resources - will surely be staggering.
Risk Management Review: A CFO's Approach
October 01, 2003
Set aside some quiet time every year to think through your insurance and risk management programs with someone knowledgeable in the field. Law firm administrators are mostly not insurance experts, and unless there is some crisis, tend not to give this area the attention it needs. Crisis time may be too late.
Unreasonable Compensation in a Professional Corporation
October 01, 2003
Until 2001, the general view was that IRS determinations of "unreasonable compensation" were not a concern for shareholder employees of professional corporations. That equanimity was shattered - at least for those paying attention - by the 2001 Tax Court decision in <i>Pediatric Surgical Associates P.C. v. Commissioner</i> (T.C. Memorandum 2001-81). In that case, the tax court determined that compensation paid to the shareholder physicians in a Texas surgical practice was unreasonably high because it exceeded the value of the services performed by the firm's shareholder physicians. This seminal tax court opinion turned on the issue of profits generated by the non-shareholder surgeons. Analogous compensation scenarios are common in law firms PCs, so they could face similar IRS determinations, with similarly costly results. Lawyers who are PC shareholders should pay close attention to this case.
