Around the Firms
November 01, 2003
Movement among major law firms and corporations.
Partnering: The Future of Legal Services Has Arrived
November 01, 2003
Over 10 years ago, E.I. du Pont de Nemours and Company adopted a model for the procurement of legal services that is based on strict legal spending rules, including early case assessment measures, consolidation of law firms and service providers handling DuPont work, and implementation of numerous other cost-saving measures. The DuPont model, which is commonly referred to as "partnering," has become a platform for the efforts of an increasing number of companies to revamp their legal service expectations and implement changes that embrace partnering between in-house and outside attorneys. Despite the amount of time that partnering has survived and the increasing number of companies adopting a partnering model, most outside counsel still meet the concept of partnering with great skepticism. This skepticism is bred from both an inability to envision the future of the legal services market and the misconception that the sole goal of partnering is to reduce legal bills for corporations at the expense of law firm revenues.
Case Briefs
November 01, 2003
Highlights of the latest insurance cases from around the country.
A Primer on the Pollution Exclusion in New York and the Duty to Defend
November 01, 2003
In June and July of this year, the New York Court of Appeals and the Second Circuit each rendered a new decision on the proper scope and application of the pollution exclusion under New York law with respect to the duty to defend. In <i>Belt Painting Corp. v. TIG Insurance Co.</i>, 100 N.Y.2d 377 (N.Y. 2003), the New York Court of Appeals held that an absolute pollution exclusion did not unambiguously exclude coverage for a personal injury claim asserting injury based on paint fumes inside an office building. In <i>W.R. Grace & Co. v. Continental Casualty Co.</i>, 332 F.3d 145 (2d Cir. 2003), the Second Circuit held that New York's historical statutory proscription against the insurance of nonsudden, nonaccidental pollution vitiated a policy provision granting coverage for "gradual pollution." The Second Circuit also confirmed in an important choice-of-law ruling that New York courts will not apply the law of various "site states" to a general liability policy; rather, New York courts will apply the single law of the state with the greatest contacts to the dispute. These cases provide further guidance to practitioners regarding (a) the limited scope of the pollution exclusion under New York law to nonenvironmental type claims, (b) the priority given to New York Insurance Law '46(13)-(14) in the face of conflicting policy provisions, and (c) the growing certainty that New York courts will apply the law of a single state to interpret a policy covering multiple risks in various locations.
Coverage for 'Restitution' Claims, Public Policy Notwithstanding
November 01, 2003
Insurance carriers frequently argue that when insureds face claims for "disgorgement" or "restitution," they need not defend or indemnify under a wide-range of liability policies. Carriers argue that, at least in California, public policy bars coverage for such claims including claims alleging failure to pay employees overtime, failure to pay taxes and penalties, and, in the intellectual property area, for disgorgement of "ill-gotten gains" or payment of a defendant's profits as a measure of damages. Insurance carriers advance this argument under various policies, including commercial general liability (CGL), directors and officers (D&O), employment practices liability (EPL), and errors and omissions (E&O) policies.
Collateral Damage: The Venture Capital Outlook and Potential
November 01, 2003
Joseph Schumpeter, in a celebrated phrase, noted that capitalism depends, for its foundation and longevity, on the "animal spirits" of the entrepreneurial class in a given region. Absent the turbo charge which the entrepreneurial culture has in the past projected into the U.S. economy, we in this country are in for an indefinite slide to economic stagnation. The national balance sheet is alarming, in the vicinity of insolvency; our manufactures are increasingly non-competitive; our labor force is displacing itself in favor of, eg, China, our currency is depreciating. I often use hypothetical benchmarks called (by me) the Fidelity Index ' an assumed list of factors professional investors are wont to use when rating and distinguishing between the debt of a AAA national credit and a Third World obligor state. Absent robust growth, look at our score card on the Index ' increasing debt as a percentage of GDP and GNP; balance sheet insolvency (in legal terms, insolvency 'in the bankruptcy sense'); extraordinary spending in the military sector growing rich/poor disparity; continuing barriers to women's rights; environmental indifference; wide spread tax evasion; attempts by both the Left and Right to politicize the judiciary; elections for sale; tainted election procedures; a state highly dependent on imported capital to recycle its debt.
The Hedge Fund Probes
November 01, 2003
On Sept. 3, New York State Attorney General Eliot Spitzer announced a $40 million settlement with Canary Capital Partners LLC (a multimillion-dollar hedge fund), Canary Investment Management LLC, Canary Capital Partners Ltd. and the managing principal, Edward Stern, for fraudulent trading of mutual fund shares. Because of suggestions that such schemes are widespread, the news has triggered a flurry of media attention and, more notably, significant regulatory inquiries, criminal probes and private class actions.
Hurdle Rates for PE/VC Funds: An Overview
November 01, 2003
A hurdle rate is a provision that requires that the partners recover their capital contributions and, often, a specified rate of return, before the general…
<B><I>Decision of Note</b></i>'Daily Show' Wins Dispute on Fair Use
November 01, 2003
A Manhattan federal district court decided that the airing of an unlicensed clip from a public access TV show to introduce a segment on Comedy Central's "The Daily Show" constituted fair use under copyright law. The "Daily Show" segment at issue opened with a one-second, full-screen shot of the plaintiff ' comedienne/stripper Sandy Kane ' dancing in a bikini. The title of "The Sandy Kane T.V. Show" is visible in the background. The clip is then further shown briefly as part of a video collage. A shorter clip of Sandy Kane's show is used in a commercial promoting "The Daily Show."
Courthouse Steps
November 01, 2003
Recently filed cases in entertainment law, straight from the steps of the Los Angeles Superior Court.
