Category: News Feeds

Of all the possible federal court reforms to pursue, cleaning up filing requirements ranks fairly low. Supreme Court justices don’t adhere to any defined set of ethics, transparency is almost non-existent, and the system is designed to disfavor age and experience in favor of promoting youth and inexperience to exert dead hand presidential legacies for decades.

But even if filing papers isn’t as weighty as those concerns… this nonsense is out of hand.

That’s University of Missouri School of Law’s Professor Dennis Crouch, author of the the Patently-O blog, doing a little spot checking of the Federal Circuit and finding the incidence of attorneys being forced to refile at exactly 100 percent.

This is admittedly a small sample size, but the odds that 10 consecutive appellate attorneys are running slapdash operations strains credulity.

Thankfully, Professor Crouch didn’t stop at 10:

Remember, this is the Federal Circuit we’re talking about, one of the last places in the federal judiciary to find pro se litigants and N00b attorneys. It boasts the most specialized bar in the whole system and lawyers are still constantly getting dinged.

Is it something unique to the Federal Circuit? Do they just have a more technical read on filing requirements because they’re all tech geeks in robes? There does seem to be something to the argument that this is a bit parochial, and perhaps the Federal Circuit — because of its unique place in the system — guards the exclusivity of its bar by playing up as many byzantine local wrinkles as possible. But while local and individual rules always introduce mischief into the process — and smack of a sense of judicial entitlement that’s problematic on a whole other level — the “invisible” local rule takes this to a new level:

“Does not actually require this.” That’s the chef’s kiss on this.

This is unacceptable for any court. Enforcing general uniformity in filing helps courts efficiently consider arguments, but when it gets to the level of “you put a blank where you meant ‘N/A’ so we’re rejecting the whole filing,” it’s just a court unnecessarily jacking up client fees by forcing attorneys to sacrifice valuable time crafting substantive argument to play arbitrary gatekeeper games. And before anyone says, “it’s not costing clients because lawyers shouldn’t charge for redoing the work,” I’m not even talking about that. Lawyers are billing clients extra to cross all these capricious “T”s in order to file it right the first time.

And this goes for the entire court system. We’ve discussed before how technical filing rules discourage pro se filers, a problem that’s only going to get worse as hiring legal counsel becomes less and less accessible to more and more people. It’s also an obstacle for pro hac counsel. Sidney Powell’s struggles to file a metric tonne of garbage on the federal courts were funny, but it probably shouldn’t be that hard for a former federal prosecutor to get a paper filed.

Again, this may not be the biggest problem in the judiciary, but it may be the only one where we can generate some quick and easy bipartisan support. So please, we’re begging you, do something about this.

And if anyone is thinking of citing this article in a formal request of the powers that be, remember to consider any specific local or individual rules before you do.

Punctilious Docketing Review [Patently-O]

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Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

We told you the associate lateral market is hot like fire rn. And boy, we weren’t kidding. We all know — and have covered ad nauseam — that special bonuses are sweeping through the elite of Biglaw, which are likely part of a calculated move to keep associates happy enough to stay put at their current firms. And other perks are being thrown into the mix — like $1,000 worth of takeout or $1,500 in exercise equipment.

But Biglaw giants looking to entice associates away from their firms are also here to play. And Kirkland & Ellis, the firm consistently taking in the most money in gross revenue, has plenty of money to throw at new hires. As reported by Law.com, they aren’t shy about it either:

For instance, Kirkland offered a third-year associate at another firm a $150,000 signing bonus; offered another candidate $50,000, plus a possible top year-end bonus and an earlier path to partnership; and offered a retention bonus to a current associate to match a signing bonus from another firm, according to a source familiar with the bonuses.

In fact, Chicago-based recruiter Kay Hoppe characterizes this as “the most aggressive associate market in history,” so it’s no wonder firms are doing everything in their power to woo the best associates:

“I handle elite partner [moves]. Everybody wants them, But more than them, they need associates,” Hoppe said. “There’s more need than there is talent. And I wouldn’t fault Kirkland or anybody else for doing what they are doing for bringing in top associates.”

“The whole thing is upside down right now,” she said about the demand for associates compared with partners. “I have no problem with a firm offering a great associate the world, because they’re needed. And the best of the best provide something that is invaluable to the clients, to the partners and to their peers.”

It’s good to see firms realizing they need to up their game to keep their associates or to attract new ones. And for all the associates out there, go find your bliss (or at least the Biglaw firm that can give you the nearest simulacrum of happy).

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Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).

All of us are subject to scammers in many parts of our lives. Indeed, people routinely receive scam emails, text messages, and other communications trying to acquire money or private information from the victim. As many attorneys know from firsthand experience, small firm lawyers are often approached by well-organized and sophisticated scammers. Such scammers prey on the fact that lawyers may have trust accounts with client money and might be hungry to originate new business. Unfortunately, there is not a lot of awareness of common scamming tactics used against small firm lawyers, and I have heard about colleagues who have been victimized by scammers. I am far from an expert on scammers and their techniques, but it is important to convey information about these scammers so lawyers can protect themselves and their clients from being targets of scammers.

Common Scams Against Small Firm Lawyers

In my experience, there are several common scams employed against lawyers and their clients. One involves wire fraud whereby scammers spoof email addresses to make it look like a lawyer is sending an email to a client about wire details. In some situations, the fake email address is off by a letter, and the scammers copy the signature block of a lawyer so clients quickly glancing at the email think that the email originated from their lawyer and that the wire details are genuine. Sometimes, lawyers themselves are subject to such spoofing, and it is important to check all email addresses to ensure they are legitimate.

Another common scam is the asset-purchase agreement fraud. A client will ask a lawyer to handle an asset purchase and act as the escrow agent for the transaction. A wire is made into the lawyer’s trust account, and then the lawyer writes a check to the scammers with proceeds. Then, the wire is reversed and any legitimate money in the lawyer’s account leaves with the check written to the scammer. As an extension of this, scammers also sometimes falsely engage a lawyer to handle an employment law matter, breach of contract case, or other issue that settles quickly. The lawyer receives a settlement check that looks legitimate and deposits the check into their trust account. The lawyer then writes a real check from their trust account, and the attorney later discovers the check they deposited was not legitimate — but any real money in their trust account leaves with the real check they wrote. Scammers may try variations of these scams as well.

Warning Signs

Many law firms accept solicitations from the internet, so attorneys need to carefully discern warning signs of questionable matters. Scammers almost never wish to speak on the phone and will almost always try to communicate exclusively through email. In addition, scammers will almost never negotiate terms in a retainer agreement, and they will always insist that attorneys’ fees come from funds to be held in escrow so that they can avoid paying real money to retain the lawyer’s services. Moreover, scammers usually have inconsistencies in their operations. For instance, they may list a telephone number and an address in different geographic locations, and they may not understand how transactions work. As another example, a scammer may tell you that documents will be mailed to your office when email is the normal way a transaction is handled so they can avoid providing information immediately.

Moreover, all of the warning signs people use to detect phishing, spoofing, and other scamming activities apply to lawyers. For instance, scammers may not have a good grasp of English and write documents with spelling and grammatical errors. In addition, scammers may provide compensation terms that are simply too good to be true because the transaction is fake.

Due Diligence

There are steps that lawyers can take to more conclusively prove whether a matter is a scam. For one, lawyers should try to never accept work unless they have at least spoken to a potential client on the phone. Scammers may also make false websites and email addresses in order to perpetuate their scam. However, lawyers can check the ICANN directory and search the domain name for email addresses and websites created by the scammers. If the domains were registered recently using unusual registrars and with addresses that seem suspicious, it is more likely that the potential clients are scammers.

If you receive a check that is questionable, you should call the bank listed on the check if the paper purports to be a certified check, and the individual or business purportedly issuing the check in other instances. Banks and companies are usually appreciative and helpful when assisting lawyers in verifying the legitimacy of transactions. Moreover, lawyers should not write checks from trust accounts until funds have settled, and lawyers should wait as long as possible before issuing checks to have the most time possible for the legitimacy of funds to be verified. Lawyers should, above all else, use common sense when dealing with potential scammers and not let the desire to originate new business keep them from conducting due diligence.

In sum, all of us know that scammers exist in many facets of our lives, and we understand how bad actors attempt to acquire money and private information from others. Although lawyers are common targets of scammers, with some understanding of typical scams and how to conduct due diligence to avoid scammers, lawyers can help protect themselves and clients from bad actors.

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Jordan Rothman is a partner of The Rothman Law Firm, a full-service New York and New Jersey law firm. He is also the founder of Student Debt Diaries, a website discussing how he paid off his student loans. You can reach Jordan through email at jordan@rothmanlawyer.com.

Is it a big deal when the feds raid a lawyer’s office and seize all his electronic devices? Asking for Rudy Giuliani, who got a visit from his friendly neighborhood FBI agent this morning and will finally quit texting reporters for at least as long as it takes him to get down to the Apple store and set up a new phone.

In fact, he got two visits, since agents knocked on the door at both his apartment and his office, the New York Times was first to report. But don’t worry, Rudy’ll be back to providing wildly incriminating copy in no time — it’s not like he can stop himself..

The Southern District of New York has been scrutinizing the president’s free lawyer for years, focusing on his business dealings in Ukraine, hamhanded efforts to gin up dirt on President Biden and his son Hunter, and a more successful attempt to get the American government to fire our Ukrainian ambassador, Marie Yovanovitch.

Along the way, Giuliani negotiated but did not execute an agreement with the sitting Ukrainian chief prosecutor, Yuriy Lutsenko, to be paid hundreds of thousands of dollars to locate stolen assets — apparently the $7 billion Giuliani fantasized that Biden absconded with using a publicly traded Franklin Templeton global bond fund.

Lutsenko loathed Yovanovitch, who backed anti-corruption forces in Ukraine, much to his consternation. The ambassador was also viewed as an obstacle to Russia-friendly oligarchs and their American allies, including Guiliani’s recently indicted buddies Lev Parnas and Igor Fruman, who sought to remake the board of Ukraine’s state-owned oil company for their own enrichment.

Whether or not Giuliani got paid directly by the Ukrainian government, he vigorously applied himself to advocating for Lutsenko’s goals. This is perhaps why career DOJ officials were prepared to go after him for possible violations of the Foreign Agents Registration Act.

But they were blocked by Bill Barr and other political appointees at Main Justice, who effectively protected the president’s lawyer for more than a year. Before the election, investigators were put off because any public pursuit of Guiliani might affect the vote. And after November, as Guiliani spearheaded efforts to get the election results overturned, DOJ bigwigs continued to drag their heels.

With Merrick Garland at its head now, the DOJ is finally willing to move. And so was the magistrate judge, who found probable cause to believe that there was evidence of a crime in Rudy’s office.

But Giuliani’s lawyer Robert Costello, of Garth Brooks pardon dangle fame, is incensed that the Department wouldn’t agree to interview his client and simply take his word for it that no crimes were committed.

“What they did today was legal thuggery,” he huffed to the Times. “Why would you do this to anyone, let alone someone who was the associate attorney general, United States attorney, the mayor of New York City and the personal lawyer to the 45th president of the United States.”

DO YOU EVEN KNOW WHO I AM?

Well, yes, we do. Rudy’s the guy who elevated the perp walk to high art and dispatched the NYPD to engage in hundreds of thousands of illegal searches in violation of the Fourth Amendment. Which makes it even more remarkable that a judge approved this warrant. But keep talking — or better yet, tweet through the pain, fella.

Federal Investigators Search Rudy Giuliani’s Apartment and Office [NYT]

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Elizabeth Dye lives in Baltimore where she writes about law and politics.

Biglaw firms are still trying to cobble together ideas on how to safely get their attorneys and staff back into the office, and one of the most prestigious firms in the country has announced a reopening plan that will have everyone back at their desks just two weeks after summer’s official start date.

According to our sources, Sullivan & Cromwell — a firm that brought in gross revenue of $1,555,441,000 in 2020, placing it at No. 18 in the most recent Am Law 100 ranking — is requiring all employees to return to the office in person on July 6. The news of the full reopening of the firm’s U.S. offices was announced earlier this month during a call with all lawyers. No email has been sent out on the matter.

Suffice it to say that the numerous associates we’ve heard from are far from happy with the situation. Why’s that? Because the firm has reportedly not made any mention of the possibility of remote, work-from-home arrangements going forward.

Here are some of the more detailed accounts of the firm’s reopening plans:

Sullivan and Cromwell is targeting a mandatory back to office by July 6, including summer associates, for all U.S. offices. No memo but this has been stated on multiple occasions, including the annual firm update and on weekly all lawyers zoom meetings. There has not been any mention of allowing anyone to do a partial work from home arrangement post-July 6. My understanding is this is one of the earliest among New York law firms. Associates are generally unhappy with the very early target date.

Wow S&C is taking a very different approach from Davis Polk. Everyone will be brought back in early July and summers will be there in person in June. We were told this is what people want and have been asking for. But we were never surveyed and I don’t actually know lawyers or staff who want a mandatory 100% return to the office the day after July 4 weekend. No memo or email, probably to prevent coverage. On the same call where leadership announced this, they would not commit to any hybrid flexibility in the future and said that we would all have to see how things go.

Above the Law reached out to Sullivan & Cromwell’s media relations team as well as the firm’s executive director with a request for comment but did not hear back before publication. If and when we do, we will provide an update here.

Are any other firms planning to reopen their offices before Labor Day and without any remote work options? The more information is out there, the more likely it is that firms will be able to establish a market standard for a return to work.

As soon as you find out about reopening plans at your firm, please email us (subject line: “[Firm Name] Office Reopening”) or text us at (646) 820-8477. We always keep our sources on stories anonymous. There’s no need to send a memo (if one exists) using your firm email account; your personal email account is fine. If a memo has been circulated, please be sure to include it as proof; we like to post complete memos as a service to our readers. You can take a photo of the memo and attach as a picture if you are worried about metadata in a PDF or Word file. Thanks.

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

Former New York Attorney General Eric Schneiderman was forced to resign from his position in 2018 following a scandal in which four women accused him of physically abusing them in the course of their relationships. Ultimately, the special prosecutor appointed to look into the allegations, Nassau County District Attorney Madeline Singas, said Schneiderman would not face criminal charges (pesky statute of limitations), but that doesn’t mean there were no consequences for his actions.

According to an order issued by the New York Supreme Court Appellate Division for the First Judicial Department, the former AG has agreed to a one-year suspension of his law license, following a petition of charges filed against him by the Attorney Grievance Committee in August 2020. The order reportedly contains an affidavit submitted by Schneiderman “acknowledging his admission” to certain facts:

“Between July 2013 and December 2014, respondent was involved in a long-term, consensual sexual relationship with M.B. On a number of occasions during their relationship respondent slapped M.B, placed his hands on her neck and applied pressure without obtaining consent, and at times he was verbally and emotionally abusive,” the order states.

And:

“Between August 2016 and September 2017, respondent was involved in a longterm, consensual sexual relationship with T.S.,” the order states. “During their relationship, respondent slapped T.S., placed his hands on her neck and applied pressure without obtaining consent, and at times he was verbally and emotionally abusive.”

Schneiderman also admitted he “slapped an unidentified attorney twice” in the course of a 2016 romantic encounter.

Schneiderman’s one-year suspension begins May 28, 2021. And the court took it a step further:

“It is further ordered that during his period of suspension, and until further order of this Court respondent is commanded to desist and refrain from the practice of law in any form, either as principal or agent, clerk or employee of another; that respondent is forbidden to appear as an attorney or counselor-at-law before any court, judge, justice, board, commission or other public authority; and respondent is forbidden to give to another an opinion as to the law or its application or any advice in relation thereto.”

Schneiderman’s actions were found to be a violation of the rules of professional conduct’s prohibition of “conduct that adversely reflects on the lawyer’s fitness as a lawyer.”

Most law students dream of passing the bar exam after graduating from law school and finding a job in the legal industry as a lawyer. They don’t dream of only being able to put the “bar” in “barista” because their law school pedigree is limiting them in the job market. They especially don’t dream of their job searches being made pointless because of an ongoing pandemic. When you’ve got up to six figures of nondischargeable debt to service after graduation, you want to know that your résumé will make it to a hiring partner’s desk — not the nearest garbage pail.

How can you be certain that the school your law degree is from won’t be a hindrance in your job search — either in good times, or especially turbulent times? Are graduates of your school capable of being hired for law jobs and putting their degrees to use, even during worldwide crises? Sadly, these questions must be asked.

Law.com produced several helpful charts based on law school employment data for the class of 2020. Today, we will highlight one of the more concerning charts, the law schools with the highest percentage of underemployed graduates. These law school graduates are either unemployed, employed in temporary or part-time work, or working in nonprofessional jobs. Here are the top 10 law schools that have helped graduates land rather underwhelming positions:

1. Pontifical Catholic University of Puerto Rico: 66.42%
2. North Carolina Central University: 65.25%
3. Inter American University of Puerto Rico: 50.27%
4. Western State College of Law: 43.68%
5. University of Massachusetts – Dartmouth: 42.37%
6. Golden Gate University: 41.94%
7. California Western School of Law: 41.55%
8. University of Puerto Rico: 41.24%
9. Charleston School of Law: 38.25%
10. Western Michigan University: 38.17%

If you think that’s bad, then look just further down the list. There are actually 22 law schools where 30% of more of 2020 graduates are considered “underemployed” by Law.com’s methodology. It’s not a good look, even during the COVID era.

Click here to see the rest of the law schools with the highest percentage of underemployed graduates, plus other informative charts detailing the schools with the highest percentage of graduates working in Biglaw and in state and federal clerkships, as well as the schools with the most unemployed graduates.

Are you a recent law school graduate who hasn’t been able to find a full-time legal job or a job in the legal profession? What has your law school done to help? We’re interested in learning about your experiences — good or bad — and may anonymously feature some of your stories on Above the Law. You can email us, text us at (646) 820-8477, or tweet us @atlblog. Best of luck in your job search!

Law Grads Hiring Report: Job Stats for the Class of 2020
 [Law.com]

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

Joshua Schiller’s January arrest on domestic violence charges seemed destined to be dropped. Before the news even got out, Schiller’s wife was already saying the whole thing was a misunderstanding and it’s difficult to bring a case when the alleged victim is saying nothing happened. Add in a police report that offered little in the way of allegations of serious injury and it was highly unlikely that prosecutors would proceed with charges.

Which is exactly what ended up happening.

Schiller’s attorneys released this statement:

“We are clearly pleased, though not surprised, by the decision to drop the charge in light of the facts and circumstances. The district attorney dismissed the case after a thorough review in the interests of justice because there was no case to prove. As we’ve stated from the beginning, there was no physical harm or instance of domestic violence in this case. Mr. and Ms. Schiller are glad to put this behind them.”

Schiller had already cleared the firm’s internal investigation conducted by Danya Perry of Perry Guha that found no evidence of physical abuse.

But as this case closes, it should remain a case study for how firms deal with abuse allegations against partners. As lawyers, firms don’t want to prejudge a defendant. Yet, as businesses, firms have obligations to employees and clients to treat these allegations seriously. Honoring both impulses is difficult.

In this case, the firm quickly released this statement back in January:

The Firm has been made aware of recent events related to our partner, Josh Schiller. While we have been informed by him and his wife that this was a misunderstanding, the firm will be conducting its own review to better understand what happened. While that review is ongoing, Josh has asked for a leave of absence to focus on his family, and we have agreed to give him this time.

Producing a timely official response announcing an independent inquiry is important. It assures everyone that the firm takes the allegations seriously and recognizes that the high burden of proof that applies to the criminal justice system is not necessarily the standard that applies to the duty of representing the firm. An ideal response would include a more direct condemnation of abuse as a general matter up to and including a strong statement that it has no place within the firm. This statement also put the entire ownership of Schiller’s leave on him, phrasing it as his request that the firm accepted. A better response for future firms in this situation would be to announce that the partner was put on leave by the firm or, at best, that the partner and firm mutually agreed to a leave.

Hiring outside counsel to conduct the investigation was another sound decision. Perry is a prominent white collar litigator with a background at the SDNY U.S. Attorney’s Office as Deputy Chief of the Criminal Division. That’s exactly the resume a firm should seek out in conducting an internal review.

Some controversy emerged around this matter when news broke that Schiller was continuing to circulate conflict checks, suggesting he never stopped generating business while supposedly on leave. As we’ve pointed out before, putting aside the underlying claims, showing a lack of respect for the process undermines the firm investigation. The firm rejected the claims about conflict checks, which may resolve the issue, but it all goes back to the problem of phrasing the leave as the attorney’s decision as opposed to the firm’s. Clear boundaries need to be set for any leave.

Hopefully firms will not have to confront the situation of partners accused of serious out-of-the-office crimes. But realistically something like this is going to come up again and whether or not the allegations ultimately result in criminal action, what happened here should be top of mind when firms craft their responses.

Earlier: Biglaw Partner Arrested On Domestic Violence Charge

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Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

For those who watch the Academy Awards, there is more to it than who wins the Oscar. Celebrities are scrutinized for what they wear and who they bring with them. Recently, people are eyeing the swag gift bag, an assortment of products and services provided to the nominees of the Best Actor, Best Actress, and Best Director awards. With an estimated value of $205,000, the swag bag is also attracting the eyes of the taxmen, who want their pound of flesh.

The swag bag is provided by Distinctive Assets, a celebrity product-placement marketing company. In the past, the Academy provided the gift bags themselves. But they stopped in 2006 when the IRS began to investigate whether these gift bags could be taxable. Eventually, the agency announced that receipt of these gift bags could be taxable income to the recipients.

So what are in these swag bags? Mostly they are regular consumer products and some novelty items. But there are also some lavish and outlandish gifts that are attracting media attention. This includes workout sessions with a celebrity trainer, a liposuction procedure, home renovation management services, complimentary vacation packages worth several thousand dollars, and a 24-karat gold vape cartridge to name a few. And perhaps the most modern gift in this package is a nonfungible token containing a digital artwork of the late Oscar nominee Chadwick Boseman.

Since these bags contain such exquisite items, one can see why tax agencies would want to know whether receipt of these items are taxable. These raises some interesting tax questions.

The first question is why these swag gift bags are subject to income tax when they are gifts. First, calling something a gift doesn’t mean that it is. Just like putting a turbo badge on your Prius or pet turtle won’t increase its quarter-mile time.

Also, the tax law has its own definition of what qualifies as a gift. It comes from the Supreme Court case of Commissioner v. Duberstein where it ruled that a transfer is a gift when the transferor’s intent comes from a “detached and disinterested generosity, out of affection, respect, admiration, charity, or like impulses.”

So do the businesses that participate in the swag bags have this sense of detached and disinterested generosity toward the nominees? Are they providing these gifts with the same intent as they would for someone celebrating an anniversary or seeing a homeless child begging for food on a snowy street? It is theoretically possible but highly unlikely. They participate (and pay up to $25,000 for the privilege) hoping that the celebrities that use them will directly or indirectly promote them on mainstream media or to their millions of followers on social media.

The second question is when the taxable event is triggered. Generally, the taxable event occurs when you receive the product. But this can get confusing for some of the more expensive service gifts, such as the free liposuction services and the vacation packages. Does the gift recipient get taxed when they get the gift certificate? Or when they actually redeem it? Thankfully, the IRS has ruled that the recipient must include the fair market value of the services at the time it is redeemed.

Finally, there are some international tax issues as well. A few of the nominees are not U.S. residents, which means they could be subject to income taxes in both the U.S. and their home countries. This double tax threat is usually mitigated by tax credits for foreign income taxes paid. There are also income tax treaties between the U.S. and other countries which usually limit how much the U.S. can tax nonresidents with reciprocal rules for U.S. citizens earning income at a treaty country.

But generally, the IRS does not like to collect taxes owed by nonresidents. So instead, they impose a withholding requirement on the payor (or a withholding agent) if the income (or gifts in this case) is considered fixed, determinable, annual, or periodic income. Since these swag bags do not contain cash, how the withholding will be done will be problematic. For a dozen cookies, will the donor have to give four of them to the IRS? Or when it comes to a three-day vacation package, does one day have to be given to a government employee? The most likely case is that the payor will have to withhold a percentage of the cash value of the gift and pay it to the IRS and possibly the state.

There are more issues than the ones mentioned above. But the receipt of swag bags at awards shows raises a host of tax issues because it is not a case where the recipient is compensated in exchange for goods and services in the usual sense. While these bags are somehow valued at over $200,000, whether they will be taxed on the entire amount upon receipt is questionable. They can decline the bag, give some of the gifts to charity, or use some of the services at a later time, any of which can change how the recipients are taxed. But if they do accept these gifts, they are not really free. While the recipients may not have to compensate the donors, they will have to pay taxes to the government.

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Steven Chung is a tax attorney in Los Angeles, California. He helps people with basic tax planning and resolve tax disputes. He is also sympathetic to people with large student loans. He can be reached via email at sachimalbe@excite.com. Or you can connect with him on Twitter (@stevenchung) and connect with him on LinkedIn.

There are people who know something about the stock market, and then there are people who think they know something about the stock market. In my experience, the former know enough about the stock market to realize they can’t possibly predict what it’s going to do in the long term (at least not beyond recognizing that it will just generally go up over a long enough period). The latter, well, sometimes they get lucky. I mean, there are only two possibilities, right? The stock market, or even an individual stock, is either going to go down or up over time. So, it can be really easy to convince yourself you’ve got some skills as an investor that are beyond the grasp of the algorithms and the Wall Street pros. Really though, it’s not that unusual to just get lucky on a few coin flips.

That being the case, I was a little amused last November by all the people I heard saying they were going to pull all their money out of their 401(k)s if Joe Biden won the election (I return to my hometown for deer hunting season every November, so I tend to encounter rural sentiments right around election time). I might have told a handful of these people the facts: that over the past century, stock market returns have been positive over the terms of more than 80 percent of presidents, and all three presidents who led the country to negative stock market returns during their terms were Republicans. But for the most part, why bother? They weren’t going to believe me over Fox News anyway.

Like most things people say in support of Donald Trump, that was probably just talk. But I really hope some of them did actually pull their money out of their 401(k)s, because the past six months have been a period of nearly unprecedented growth in the stock market. From Election Day, Tuesday, November 3, 2020, to approximately the end of April 2021, the S&P 500 went from about 3,369 to around 4,187. That’s more than a 24 percent return in less than six months. The Nasdaq Composite went from 11,161 on November 3 to 14,090 on April 27, gaining more than 26 percent in less than six months. Biden’s first 100 days in office have seen the strongest stock market returns of any presidential administration’s first 100 days for at least 75 years.

I figure if a long-term capital gain never materializes because you irrationally pulled your money out of the market to spite Democrats or whatever, you will just have that much less money to donate to Trump next time around. But forgetting about Democrats and Republicans for a minute, to the extent that remains possible in our society, all Americans should finally learn the lesson that who the president is usually doesn’t matter all that much to the stock market. Based on historical data, your odds of realizing good returns in the equities markets might be a little better under a Democratic president than under a Republican one. But your odds of seeing positive returns under a president of either party are quite good.

The stock market has been on fire since Biden was elected, and while he inherited a stock market that was already making a solid recovery following the initial COVID-19 plunge, he probably still deserves some credit. But the lesson to take away here isn’t just that Biden has been far from the disaster for the stock market that some Trump supporters feared. The lesson is don’t pull your money out of the stock market because you are pouting about an election result. Why rub monetary losses in the open wound of an unfavorable election result?

Neither you nor I know better than however it is already priced into the market how the next president will affect the stock market. I didn’t pull my money out of the stock market when Trump was elected. I obviously didn’t pull it out when Biden was elected either. I certainly won’t convert my investments to cash after the election of whomever the next president is. Neither should you.

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Jonathan Wolf is a civil litigator and author of Your Debt-Free JD (affiliate link). He has taught legal writing, written for a wide variety of publications, and made it both his business and his pleasure to be financially and scientifically literate. Any views he expresses are probably pure gold, but are nonetheless solely his own and should not be attributed to any organization with which he is affiliated. He wouldn’t want to share the credit anyway. He can be reached at jon_wolf@hotmail.com.