Legal News for Tues 5/14 - Perkins Coie Expands to London, Menendez Corruption Trial Jury Selection, DE Hearing on Fees, Challenges to Youth Climate Lawsuit and Pentagon Leaker Teixeira's Proceedings

Minimum Competence

This Day in Legal History: Constitutional Convention Assembles

On May 14, 1787, a pivotal moment unfolded in American history as delegates from each state began to gather in Philadelphia for what would be known as the Constitutional Convention. This assembly was critical in shaping the nation's future, aimed at addressing the deficiencies of the Articles of Confederation—the loose framework that initially bound the states together after independence.

As the delegates arrived, the stakes were incredibly high. The existing government structure under the Articles was proving inadequate in managing various critical issues, such as interstate disputes and financial instability. The Philadelphia meeting was convened to create a more robust federal government while ensuring that individual liberties were not infringed upon.

Notably, every state except Rhode Island sent representatives to the Convention. Among the attendees were some of the most distinguished figures of the era, including George Washington, who was unanimously elected as the president of the convention, and James Madison, now considered the "Father of the Constitution" due to his pivotal role in drafting the document.

The convention sessions were held in strict secrecy, a decision made to foster open debate and prevent external influences. The result of the intense deliberations, which continued until September 17, was the creation of a new Constitution. This document established a stronger federal government with separate executive, legislative, and judicial branches, fundamentally changing the direction of the United States.

The ratification process that followed was another intense debate, reflective of the diverse viewpoints within the states about the balance of power between state and federal authorities. The Federalist Papers, written by Alexander Hamilton, James Madison, and John Jay, played a crucial role in persuading the public and state legislatures to adopt the new Constitution.

Today, the Constitution remains a living document, central to American law and governance, illustrating the enduring legacy of the decisions made during those historic months in Philadelphia. The events of May 14, 1787, mark not just the beginning of the Constitutional Convention but also the starting point of a constitutional democracy that would influence governance structures worldwide.

Perkins Coie, a Seattle-founded law firm, is expanding its global footprint by launching a new office in London. The London office will be led by Ian Bagshaw, former co-head of White & Case’s global private equity practice, who joined Perkins Coie after leaving Big Law to chair a startup. Joining him are three other former White & Case lawyers, including Jan Andrusko, who will serve as the European head of M&A for Perkins Coie.

The London office aims to tap into the local and European markets for venture capital, private equity, and startups, leveraging the firm's established tech-sector expertise in the U.S. Perkins Coie plans to offer a comprehensive range of services through this single European hub, focusing on privacy, technology transactions, and M&A, without pursuing a network of offices across Europe.

This strategic move marks Perkins Coie's first establishment outside of the U.S. and Asia. In 2021, the firm ranked 43rd largest in the U.S. by revenue, with earnings of $1.2 billion. The London office will initially feature a corporate group but may expand to include intellectual property and litigation services to provide a more rounded offering to tech-focused corporate clients.

Ian Bagshaw, along with partners Jan Stejskal, Craig Fagan, and Barry O’Driscoll, and senior counsel Jan Jakoubek, are part of the founding team. They bring significant experience in private equity, cross-border M&A, and corporate law, aiming to recreate the startup culture prevalent in the U.S. within the European context. Bagshaw highlighted the startup-like environment of the new office and his motivation to build a new business with a clear strategic direction as key factors in his move to Perkins Coie.

The focus on privacy and technology transactions in the new office is significant. These areas are crucial in the tech sector, involving the handling of sensitive data and the execution of tech-related deals, which are key growth areas in European legal markets. This strategic choice underlines Perkins Coie's intent to leverage their U.S. strengths in a new market, reflecting broader trends in global law practice where specialization aligns with industry needs.

Perkins Coie Launches London Office, Eyeing Start-Up Tech Market

Jury selection for U.S. Senator Robert Menendez's corruption trial resumed on May 14, 2024, in Manhattan federal court, with charges stemming from an alleged bribery scheme involving foreign governments. Menendez, a New Jersey Democrat, has denied wrongdoing, pleading not guilty to 16 charges, including bribery, fraud, acting as a foreign agent, and obstruction. The trial also involves two New Jersey businessmen, Wael Hana and Fred Daibes, and Menendez's wife, Nadine, who will be tried separately due to medical reasons.

The accusations detail that Senator Menendez accepted substantial bribes, including cash, gold bars, and a luxury car, in return for political favors to the governments of Egypt and Qatar. The FBI discovered much of the cash hidden at the Menendezes' home. Menendez allegedly facilitated arms deals for Egypt and attempted to secure a monopoly for Hana on halal meat certifications to Egypt. He is also charged with attempting to influence a Qatari investment fund on behalf of Daibes and interfering in a criminal case against him.

Despite the severity of these charges, Menendez has not resigned but has stepped down from his role as the leader of the Senate Foreign Relations Committee. His previous legal troubles in 2017, involving a wealthy Florida ophthalmologist, ended in a mistrial. As the current trial unfolds, Menendez faces significant public disapproval in New Jersey, complicating any potential reelection efforts. His wife's trial is scheduled for July 8, where health concerns will play a central role, and Menendez might shift blame to her as part of his defense strategy.

Jury selection to resume in US Senator Menendez's corruption trial | Reuters

The Delaware Supreme Court is set to hear an appeal concerning a substantial attorney fee award in a lawsuit involving Dell Technologies Inc. and a $1 billion stockholder settlement over a stock conversion, which was allegedly coerced by Michael Dell and Silver Lake LLC in 2018. This case, which is notable for its rare nine-figure fee award, reflects a broader discussion in Delaware about how much plaintiffs' attorneys should be compensated in significant legal settlements.

In this particular case, attorneys who facilitated the historic settlement were awarded $267 million, which represents the second-highest fee ever awarded in the state's Chancery Court history. This award is currently being challenged by Pentwater Capital Management LP, which argues that the 27% fee is excessively generous and constitutes a windfall.

The appeal comes at a time when Delaware's courts are also considering other large fee requests, including two involving Tesla Inc., where one case seeks a $230 million fee for a settlement concerning board compensation, and another involves an investor challenging CEO Elon Musk's pay package.

The Delaware courts have historically used a multi-factor test to determine the fairness of legal fees, which considers the complexity of the case, the attorneys' skill and experience, and the risk of contingency. The debate over these fees has even drawn input from law professors, with some advocating for a declining-percentage method used in federal courts, which reduces the percentage fee as the settlement amount increases.

This ongoing legal debate highlights the evolving challenges and considerations in determining reasonable compensation for legal services in major corporate litigation, especially in a state known for its significant corporate law cases.

Dell Fee Request at Delaware High Court Could Impact Tesla Suits

The legal battle involving 21 young plaintiffs in a significant U.S. climate lawsuit has reached a precarious point following a recent decision by the U.S. Court of Appeals for the Ninth Circuit. The court granted a February request from the Justice Department to dismiss the case, known as Juliana v. US, directing Judge Ann Aiken of the U.S. District Court for the District of Oregon to terminate it. This lawsuit, aiming for government accountability on climate action, has seen setbacks before, including a 2020 dismissal where the plaintiffs' demands for more aggressive government intervention against global warming were deemed beyond judicial capability to grant.

The plaintiffs, represented by Our Children’s Trust, are now considering limited options, such as requesting a full panel rehearing at the Ninth Circuit or potentially escalating the matter to the U.S. Supreme Court. However, legal experts, including Michael Gerrard of Columbia University’s Sabin Center for Climate Change Law, caution against the latter due to the Supreme Court's current composition, which may not be favorable towards climate-related cases.

The recent ruling underscores judicial hesitancy to engage in what is seen as policy-making—a realm typically reserved for the legislative branch. Despite this, the plaintiffs' lawyer, Julia Olson, argues that a court declaration recognizing the unconstitutional nature of current government practices could be transformative, similar to past court interventions that advanced justice and equality. Yet, the feasibility of such outcomes appears increasingly doubtful under prevailing legal standards and judicial perspectives.

With these challenges, some suggest that initiating a new lawsuit with updated claims might offer a more straightforward route, given the ongoing and emerging government failures in addressing climate change since the initial 2015 filing. This strategy could potentially bypass previous legal obstacles, presenting fresh grounds for legal arguments based on more recent developments in climate policy and its failures.

Youth Climate Lawsuit Faces Dire Path After Ninth Circuit Ruling

Jack Teixeira, a 22-year-old member of the Massachusetts Air National Guard, is facing further legal challenges after already pleading guilty to serious national security breaches involving the leak of classified documents. Teixeira, who had been arrested in April 2023, admitted to charges related to leaking sensitive information on military operations, including details about the war in Ukraine, under a deal with the U.S. Department of Justice that proposed a minimum of 11 years in prison. Despite this civilian court case, the Air Force has opted to pursue additional military charges against him, which could lead to another 10 and a half years in prison if he is convicted.

These military charges include obstructing justice and failing to obey a lawful order, with a hearing set to take place at Hanscom Air Force Base in Massachusetts to assess whether the evidence is substantial enough to proceed to a court-martial. Teixeira, who worked as a cyber defense operations journeyman with top-secret security clearance, reportedly shared classified information on various international issues through a messaging app, impacting U.S. and global security interests. His sentencing for the civilian charges is scheduled for September 27.

Pentagon leaker Jack Teixeira faces US military justice hearing | Reuters

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