Category: News Feeds

“For me for the connection between the commercial terms and the legal terms in a contract is that risk costs money and, oftentimes, the legal terms provide a remedy,” Jeanette Nyden says. “The more that we play with the legal terms, to allocate risk the more likely to increase the possible remedies, the more of a boomerang effect there will be on the relationship and increased costs.”

Nyden is a widely recognized expert in the field of legal contracts. She has authored or co-authored numerous books, including The Contract Professional’s Playbook: The Definitive Guide to Maximizing Value through Mastery of Performance- and Outcome-Based Contracting; Getting to We: Negotiating Agreement’s for Highly Collaborative Relationships; Negotiation Rules! A Practical Approach to Big Deal Negotiations; and The Vested Outsourcing Manual: A Guide for Creating Successful Business and Outsourcing Relationships.

You should never start negotiating with the legal terms, Nyden advised. “When you get a straight legal term, you’re not thinking of commercial terms. That’s a challenge. Legal terms often sound really grand but they impact the commercial aspects of the deal, as well,” she said. For example, when negotiating a warranty clause, look at the buyer’s ability to detect a defective item or nonconforming service through testing and approvals first. It is far better to catch the defect before it is accepted by the buying company, then later through a warranty claim. 

She recommends taking a three-step approach: create a risk profile, manage risks through policies and governance, and then (and only then) use legal tools like a limitation of liability and indemnities.

Start With A Risk Profile 

It is important to align your intentions around supplier performance. Nyden explained. “First, figure out what kind of supplier performance you are looking for. Then you can get back to the contract.” Starting with a risk profile is a good way to begin. “Lawyers really cannot have a thorough understanding of what the risk formula (i.e., limitations of liability) they create should look like if they don’t have a really good idea of the risk profile involved,” she added.

According to Nyden, one way to create a risk profile is by asking and answering these questions: How detectable is the risk? How probable is it? How severe is it? From there, you can develop a profile. You can create an easy color-coded system with red, yellow, or green profiles corresponding to different risk levels. She recommended working with the line of business to identify risks.

Having robust processes to identify, document, and manage the risks process is a must. Ask yourself: Are there early warning signs? How probable is it? “What I want to do is look at it upfront,” Nyden explained. “What protections do we need in the statement of work so that we’ve got the right kinds of security in place, even if that’s as much as we can do?” 

Manage Risks Through Policies And Governance

Then, through operational means, identify ways to mitigate the risks you’ve identified. You need to make sure that the right technical specifications are outlined. “Corrective action planning, cure notices, monthly or quarterly reports, and numerous other mechanisms are there to protect your client from unnecessary risk,” Nyden said. She recommended looking at how corporate policies can control risks. Ask yourself: Do you have the kind of audit rights that you need? Do you have the right kind of background checks in place?

“You can mitigate these risks by having operational procedures such as reviews, approvals, or acceptance-testing in place,” Nyden said. “You can also control risks through stronger corporate policies and audit rights, and things like that.”

According to Nyden, there are differences between controlling, mitigating, and allocating risks. “If you are not actually trying to prevent the loss from happening through mitigation, you need to work in control features. Look at how your statement of work is written and mitigate the risk as much as possible with technical specifications. You can control it through things like audit procedures, background checks, and insurance provisions.”

Lastly, Use Legal Tools

Then, and only then, look at your limitation of liability and indemnification clauses—things like that. Once you have done the hard work, your exposure and liability will become clear. That is a good time to use legal tools like a limitation of liability and indemnification. But those are crude tools; they do not minimize risk. They focus on allocating the responsibility for the risk event and payment once the size of the risk is determined. They should only be used as a last resort.

“Once we’ve been able to identify the risks, you can look at specific potential liabilities, Nyden explained. “If you insert liquidated damages first, then you effectively accept risks and waive other remedies against the supplier.”

In the end, “I see a lot more companies demanding more now,” Nyden observed. “Saying that their buying organization wants higher limitations on liability, higher penalties for late delivery, more indemnification, intellectual property, and especially with GDPR,” she added. “My concern is that this is just a policy. As a contract professional, I prefer to focus on the statement of work. It allows me to address risks through operational excellence and governance.”

Olga V. Mack is the CEO of Parley Pro, a next-generation contract management company that has pioneered online negotiation technology. Olga embraces legal innovation and had dedicated her career to improving and shaping the future of law. She is convinced that the legal profession will emerge even stronger, more resilient, and more inclusive than before by embracing technology. Olga is also an award-winning general counsel, operations professional, startup advisor, public speaker, adjunct professor, and entrepreneur. Olga founded the Women Serve on Boards movement that advocates for women to participate on corporate boards of Fortune 500 companies. Olga also co-founded SunLaw, an organization dedicated to preparing women in-house attorneys to become general counsels and legal leaders, and WISE to help female law firm partners become rainmakers. She authored Get on Board: Earning Your Ticket to a Corporate Board Seat and Fundamentals of Smart Contract Security. You can email Olga at olga@olgamack.com or follow her on Twitter @olgavmack. 

A Chinese scientist who last year sparked controversy with the announcement that he had used gene-editing technology on human embryos has been sentenced to prison, Chinese state media reported.

The Xinhua News Agency reported Monday that a court in Shenzhen, Guangdong province – a booming city near Hong Kong – had sentenced researcher Jiankui He to three years in prison and fined him 3 million yuan, equivalent to about $430,000.

Two researchers at other medical institutes in Guangdong, Renli Zhang and Jinzhou Qin, received respective two-year and 18-month prison terms and fines as well, Xinhua reported. The verdict stated that all three had knowingly violated China’s regulations and ethical principles to practice gene editing despite not being licensed physicians and had done so in the interest of personal gain.

He, a researcher at the Southern University of Science and Technology, also in Shenzhen, caused a global outcry last November when he announced in a series of videos on YouTube the birth of twin girls whose genomes he and a team of researchers had edited using CRISPR-Cas9 technology. The girls’ genomes were edited so they would not carry the gene CCR5, which hypothetically would render them immune to HIV, smallpox and cholera.

The announcement sparked an immediate backlash, with 120 Chinese scientists condemning the experiment as “crazy” and “unethical,” and He’s university soon suspended him without pay pending an investigation. Xinhua later reported that a second woman had also given birth to a gene-edited child, and He had used falsified ethical review papers to persuade couples to take part in his experiments. Meanwhile, 18 scientists signed a statement published in Nature calling for a global moratorium on human genetic engineering, with countries agreeing not to approve editing of heritable DNA – also known as human germline editing – unless certain conditions are met.

Rice University in Houston, which He had attended, also launched an inquiry into a professor under whom He had studied, Michael Deem, following news reports that quoted him as saying he had been involved in the research. Rice University director of media relations Doug Miller said in a phone interview that the investigation was still underway, but declined to comment further.

Photo: ANTHONY WALLACE/AFP via Getty Images

Look, I’m all for restoring ex-convicts to the full status of American citizenship. If you are deemed safe enough to be allowed free, then you are once again a part of society and should be treated as such. So I’m all for this new legislation in California that will allow ex-felons to serve on juries.

Just, don’t tell me you’re doing this to get “black” people on juries. That’s not the point here. Yes, incarceration disproportionately affects African-American communities. Yes, refusing to restore the rights of ex-cons disproportionately affects African-American communities. Yes, the restoration of rights are withheld because those most affected are disproportionately black and brown. All of that is true. But these quotes from local officials in San Francisco really pissed me off. From the San Francisco Examiner:

The new legislation is supported by both Public Defender Manohar Raju and incoming District Attorney Chesa Boudin.

Boudin called the legislation a “significant step” toward ending racial disparities in the criminal justice system.

“Up to now, California law bars anyone with a felony conviction from serving on a jury,” Boudin said. “This disproportionately silenced people of color and prevented many people from being tried by a jury of their peers — a fundamental pillar of our justice system.”

For Raju, the change in state law means people with real experiences in the criminal justice system will be able to share their “invaluable” perspectives in the jury room.

He also said the legislation will help people with felony convictions reengage in society.

“It is very common for an African American client to look around the courtroom and feel that they do not have a jury of their peers, as there may not be a single seated African American juror,” Raju said.

Listen, fellow do-gooders, the reason African-American defendants cannot get a jury of their peers is because prosecutors use their peremptory challenges to exclude all the black jurors. Do not act, even in your zeal to make this important change, like you can’t get a diverse jury in San Fran Freaking Cisco because all the black people are in jail or just out of lock-up. You can’t get a fair jury because prosecutors exclude fairness.

Prosecutors regularly use peremptory challenges in a racially biased manner, and this new legislation does nothing to stop them. That’s because the core of the problem is that Batson is a load of crap. Prosecutors are easily able to avoid the race-neutral test laid out in Batson v. Kentucky, PRECISELY as Thurgood Marshall predicted they would in his concurrence in that case. Let’s listen to old Justice Marshall for a second, shall we?

The decision today will not end the racial discrimination that peremptories inject into the jury selection process. That goal can be accomplished only by eliminating peremptory challenges entirely… I wholeheartedly concur in the Court’s conclusion that use of the peremptory challenge to remove blacks from juries on the basis of their race violates the Equal Protection Clause. I would go further, however, in fashioning a remedy adequate to eliminate that discrimination. Merely allowing defendants the opportunity to challenge the racially discriminatory use of peremptory challenges in individual cases will not end the illegitimate use of the peremptory challenge.

This is your problem, California. It’s not that felons aren’t allowed on juries, it’s that black people aren’t allowed on juries if the prosecutor has a modicum of creativity when inventing a reason to exclude them. And if California prosecutors are already good at excluding NON-CRIMINAL black people from juries, you can imagine the field day they’re going to have with a potential juror with a rap sheet.

Don’t get me wrong, it’s still a good law. Well, it’s a good thought. But until you deal with the racist prosecutorial elephant in the room, the Sixth Amendment rights of black and brown defendants will still be nothing more than a theoretical promise, as opposed to a reality of justice.

California to allow people with felony convictions on juries beginning 2020 [San Francisco Examiner]

Elie Mystal is the Executive Editor of Above the Law and a contributor at The Nation. He can be reached @ElieNYC on Twitter, or at elie@abovethelaw.com. He will resist.

Pepper Hamilton isn’t a stranger to disappointing bonuses. But the bonus scale released by the firm last week continues the trend. The firm announced their bonus grid, keyed to hours associates have billed, and it is noticeably smaller than the market bonuses going around Biglaw.

Here’s the scale the firm released:

If the limited number of bands, as opposed to class years, is confusing, a tipster has provided an easy guide — as well as some commentary:

Level 1: 1&2+ years
Level 2: 3+4+
Level 3: 5+6+
Level 4: 7-8+ years
People may spend more than one year in the same class year or band

So essentially, even on the fastest track of leveling up (class year = level), 8th years are still making the same bonus as a first year at other firms with market bonuses

As a reminder, market bonuses as set by Milbank in November, are giving second year associates (class of 2017) $25,000. So… yeah. Though the firm also announced associates may be eligible for additional discretionary bonuses based on merit, which could bring their total bonus in line with market levels.

Read the full memo on the next page.

Remember — we can’t do this without you, dear readers! We depend on your tips to stay on top of important bonus updates, so when your firm matches, please text us (646-820-8477) or email us (subject line: “[Firm Name] Matches”). Please include the memo if available. You can take a photo of the memo and send it via text or email if you don’t want to forward the original PDF or Word file.

And if you’d like to sign up for ATL’s Bonus Alerts (which is the alert list we also use for all salary announcements), please scroll down and enter your email address in the box below this post. If you previously signed up for the bonus alerts, you don’t need to do anything. You’ll receive an email notification within minutes of each bonus announcement that we publish. Thanks for your help!

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).

A subpoena that Congress serves on the president is not like a subpoena that one litigant serves on another.

When one litigant serves a subpoena on another, we (unfortunately, perhaps) expect battles over the propriety of service, and the scope of production, and whether documents are in one’s control, and so on.

That’s just life.  Lawsuits are an adversarial process, and the opposing parties are expected to resist (within the bounds of the law) to protect their respective interests.  So they fight.

But what about subpoenas served by Congress on the executive branch?

When I first turned this question over in my mind, I thought that the executive branch should naturally try to assist Congress. These are not subpoenas served in an adversarial process. Congress and the executive are co-equal branches of government. Congress has a constitutionally mandated duty to oversee the president. Surely, if Congress subpoenas the executive branch, the executive branch should strive to comply.

But then I thought harder.

Litigants are mere litigants. As one wise litigator told me decades ago, “They’re my opponents, not my enemies.”  (One of the parties, nearly forced into bankruptcy by the litigation, responded, “They may be your opponents.  They’re my enemies.”  But that’s another story.)

Anyway, in a sense, politicians are worse than mere litigants.

The opposing political parties, unlike most litigants, seemingly will do anything in their power to hurt each other, including things that would be unethical in litigation (such as knowingly misrepresent facts, and so on).

Given that crazed partisans in Congress are serving subpoenas on crazed partisans in the executive branch, is the executive branch really duty-bound to assist in good faith?

(Be fair now.  You might first think “impeachment.”  But then think “Benghazi.”  What’s sauce for the goose is sauce for the gander.)

Logically, you might think the branches of government should cooperate with each other, but I’m not sure.

Maybe the executive can legitimately resist at every turn, playing just as hardball as a private litigant.

That puts the courts, of course, in a terrible situation.

When litigants disagree, the judiciary calls balls and strikes. Everyone complains, but the parties accept the decisions and go on with their lives.

When partisans disagree, the judiciary could decline to call balls and strikes under the “political question” doctrine. But then no one would decide these disputes, which is an impossible situation.

Or the judiciary could involve itself in the fray, but judges would then be decried as partisan, no matter what the decision.

I’m not sure that the executive and legislative branches of government are duty-bound to cooperate with each other, but I know that the judiciary is the institution that suffers when they don’t.

Mark Herrmann spent 17 years as a partner at a leading international law firm and is now deputy general counsel at a large international company. He is the author of The Curmudgeon’s Guide to Practicing Law and Inside Straight: Advice About Lawyering, In-House And Out, That Only The Internet Could Provide (affiliate links). You can reach him by email at inhouse@abovethelaw.com.

The president’s free lawyer is back from his Excellent Eastern European Adventures and hopes to present his book report to the Senate real soon.

“He’s going to make a report, I think to the attorney general and to Congress,” Trump promised earlier this month, adding, “he has a lot of good information.” By which he means some hallucinatory meanderings accusing investment giant Franklin Templeton of laundering $7 billion of stolen Ukrainian government assets back into Ukrainian government bonds. And that’s not even a joke.

“I’m working on pulling it together and hope to have it done by the end of the week,” he told the Washington Post.

Unbelievably, the august members of the upper chamber have one or two tiny reservations about America’s Mayor.

“I wouldn’t trust Rudy to represent me in a parking dispute so I’d say avoid,” a senior GOP Senate aide told The Daily Beast. Which is downright unkind! Who among us hasn’t managed to talk our client into an impeachment by convincing him that Ukraine hacked the DNC server, then framed Russia and smuggled the equipment over to Kyiv, only to bury it in some oligarch’s backyard where it sits today just waiting for the president to insist on its prompt return? (Again, not a joke.)

“Rudy Giuliani long ago lost any shred of credibility, especially after the dossier he assembled for the State Department stunningly mirrored Russian propaganda,” Sen. Bob Menendez, D-N.J., told the Daily Beast. “Knowing that, anyone that attempts to defend President Trump’s behavior by citing Rudy’s information over our own intelligence agencies is simply irresponsible, uninformed, or willing to be that useful idiot the Kremlin desires.”

Well, he would say that. He’s a Democrat and doubtless trapped under Nervous Nancy’s iron thumb. Surely, Rudy will be better received by his fellow Gippers.

“My advice to Giuliani would be to share what he got from Ukraine with the IC [intelligence community] to make sure it’s not Russia propaganda. I’m very suspicious of what the Russians are up to all over the world,” Lindsey Graham, R-S.C., said.

How odd! Especially after the State Department already refused to act on Rudy’s last book report, compiled with the help of a graduate of the KGB academy in Moscow and a Ukrainian parliamentarian from the pro-Russian Party of Regions.

“It’s not Russian propaganda,” Giuliani told the Daily Beast. Which should, after all, settle the matter. He is after all a world-renowned cyber expert and former Attorney General of the United States.

It’s just bizarre that not a single senator will agree to meet with him. Inexplicable, really.

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

Thanks to a confluence of events –- the election of more moderate District Attorneys (some who were former defense attorneys), the proliferation of podcasts like “Serial” and crime series like “When They See Us” and “The Night Of” — more people are aware that it’s possible to be wrongfully convicted and that incarceration is costly, sometimes unnecessary, and often cruel.

The sweeping “woke” movement has prompted changes including reducing federal sentencing on crack-possession crimes, the legalization of marijuana, and a vast rethinking of police procedures: No longer is it “acceptable” to stop and detain young men merely because they are black or Hispanic; police who don’t videotape arrests or interrogations are considered to be hiding something; and, a shoot-first, ask-questions-later philosophy is no longer accepted as proper police practice. Cops are being reprimanded for bad arrests and sometimes even prosecuted for murder, although still rarely convicted.

Groundbreaking changes in how crime is prosecuted in New York begin on January 1, and include compelling the prosecutor to turn over evidence against a defendant early in a case, as opposed to the eve of trial. People accused of most low-level crimes will no longer be thrown in jail simply because they don’t have the money to make bail. Many cities have already instituted similar changes and crime has not risen. The prosecution’s thumb on the scales of justice is slowly being lifted.

“Decarceration” (the process of getting people out of jail) has become as debated a topic as incarceration. Exoneration initiatives have proliferated, and stories of people being released from prison after serving decades of time for crimes they did not commit are commonplace.

All of these changes are welcome and much needed. But I remain cautious.

Our approach to crime, like the political swings of our country, is cyclical, never only moving forward but circling back when things get tough or crime goes up. In the bad old 1980s, when crime was rampant in New York City and property values fell, the “broken window” philosophy took hold, and stop-and-frisk became a tool to address crime. Stop-and-frisk was based on racial profiling. Stop enough young black and Hispanic kids, and cops are bound to find someone with a gun, right? Sometimes they did, but few records were kept of how many thousands of innocent kids were stopped and searched with nothing illegal found. The practice was not only discriminatory, but it created a huge animosity between communities of color and the police. It has not only been discontinued, but even former NYC mayor Michael Bloomberg had to apologize for permitting it to happen under his watch when he recently announced his candidacy for president.

Times change and people’s perceptions of “justice” change with it. That is not due to some massive acceptance of the wrongness of jailing the underclass.  It’s merely a reaction to the times. Crime is down. Prisons are costly. Drug abuse (which can lead to incarceration) is no longer just a lower-class phenomenon but affects both haves and have-nots. Because of that, legislative leaders have the leeway to think about the criminal justice system more holistically and not just to build more prisons.

But if the gap between rich and poor grows wider, if poor kids continue to go to poor schools and therefore have fewer opportunities for advancement, and if crime statistics inch up again, we’ll return to the harsh approach of the 1980s a lot faster than it took us to evolve to where we are today.

Whether we continue moving toward greater social justice comes down to three things –- money, judges, and the vilification of “the other.”

Crime brings down property values –- nobody wants that.

Judges determine the interpretation of the law. They’ve got a lot of discretion in that area, and many are coming into this new age of criminal justice kicking and screaming. One judge in New York City was quoted by the Daily News as calling the new bail laws “stupid.”

Then there’s the fact that our conservative president has been appointing conservative federal judges since he took office. While someone’s political affiliation is not necessarily a litmus test of how they’ll rule on the bench, it’s pretty safe to say that certain basic constitutional rights like the right to privacy, which effect how much the government can surveil everything from your social media accounts to your phone conversations, will be impacted in upcoming cases. Miranda rights may be whittled down, and probable cause to arrest is largely still interpreted by a whatever-the-police-say-is-right approach.

Lastly, with the upswing of fear of “the other,” represented in the present day by anti-immigrant speech, a rise in antisemitism, and a concurrent rise in white supremacy movements, gains in the criminal justice system may be short-lived as all of those factors presage an uptick in crime.

In spite of recognition that jails don’t help rehabilitate and should be made more humane, our president has authorized the separation of immigrant children from their parents, detention centers which are little more than cages, and has not provided sufficient funding to appoint more judges to adjudicate their cases efficiently.

So, while we’ve seen some significant, positive changes, continued progress is by no means certain.

Toni Messina has tried over 100 cases and has been practicing criminal law and immigration since 1990. You can follow her on Twitter: @tonitamess.

For Mitch McConnell to say he’s working with the White House, coordinating with the defendant in this trial before the trial has even begun is atrocious. He may think he’s a judge impaneling an all-white jury for a Klansman trial in Mississippi in 1965. That’s not the kind of trial we have.

— Richard Painter, former chief White House ethics lawyer under George W. Bush, appearing on CNN sounding off on the Senate Majority Leader’s strategy on impeachment. Also on the segment was former senator Rick Santorum who disagreed with Painter, saying McConnell was “completely appropriate.”

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).

* There is a lawyer who gets to decide whether bottleheads of the pope are allowed to be made. Sounds like a pretty good gig. [Wall Street Journal]

* A New York lawyer who practiced until he was 101 has passed away. [New York Times]

* Wawa has been hit with lawsuits over a massive data breach. Everyone who lives in North Jersey is breathing a sigh of relief… [ABC News]

* An Illinois man who pretended to be a lawyer for five years has been charged with the unauthorized practice of law. [Patch]

* A Florida attorney has been suspended from practice after making anti-Muslim and homophobic remarks. [Miami Herald]

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.