Wall Street

Ed. note: This post is by Will Meyerhofer, a former Sullivan & Cromwell attorney turned psychotherapist. He holds degrees from Harvard, NYU Law, and The Hunter College School of Social Work, and he blogs at The People’s Therapist. His new book, Life is a Brief Opportunity for Joy, is available on Amazon (affiliate link).

To judge by the accoutrements of “the profession,” lawyers, as a group, maintain an inflated self-image. They think they’re all that. It’s easy to get sucked into this mindset – especially fresh out of law school. Perhaps, when you’re not “thinking like a lawyer,” you’ve spent a few minutes admiring the little “Esq.” printed after your name on an envelope from school or a law firm — or some company in Parsippany trying to sell you a genuine mahogany and brass pen holder featuring a statue of “blind justice” for only $59.99 with free shipping.

Back when I passed the bar, I was offered the option by New York State to purchase a printed document – “suitable for hanging” – to memorialize the event. I figured what the heck and blew the twenty-five bucks. The “parchment” arrived in a cardboard tube, and it was huge – like a royal proclamation. I felt ridiculous, rolled it back up and stuck it in a closet, where it remains.

It’s hard to imagine accountants (who usually make more than lawyers), or bankers (who always make more than lawyers) laying on the pretension to quite the degree lawyers take for granted…

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Matthew Kluger aka Big Gay Matt

“Aww, Matt, why do you have to go around giving us a bad name?”

Ever since Matthew Kluger was charged in a massive insider trading case, involving an alleged conspiracy that spanned 17 years and generated more than $32 million in profit, the foregoing question could be asked by many groups: Cornell grads, NYU law grads, Cravath lawyers, Skadden lawyers, and Wilson Sonsini lawyers.

Tonight we can add more groups to the list: Fried Frank lawyers, and gays — specifically, gay dads.

As reported by the Wall Street Journal earlier tonight, Matt Kluger worked at yet another major law firm: Fried Frank. After he was fired by the firm in 2002, he sued, claiming that partners there discriminated against him because he’s gay — and a father of three, with parenting responsibilities.

Just when you thought this case couldn’t get any weirder, it just did. Matthew Kluger is gay. And a dad. With three kids. Thanks for sending America such a positive image of LGBT parents, Matt!

Let’s take a closer look at Kluger’s suit against Fried Frank — and additional details about Matt Kluger’s complicated personal life, gleaned from ATL tipsters….

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Jeff Skilling

* Former Enron CEO Jeffrey Skilling’s appeal was denied by the Fifth Circuit. While he remains the smartest guy in the room, the room consists of him and a half-wit cellmate whose only discernible talent is making Prune-o. [WSJ Law Blog]

* Bruce Fein, an attorney who worked on Clinton’s impeachment and called for Bush’s impeachment as well, has drafted articles of impeachment for Barack Obama. His high crime and misdemeanor? Time theft. [Politico]

* An Ohio man has been charged with a misdemeanor for barking at a police dog. When asked why he was barking at the female dog, the man calmly replied, “Bitch owes me money.” [CBS News]

Raj Rajaratnam

* The government rested its case in the Raj Rajaratnam trial yesterday. Of additional note is the fact that Rajabba sits ten feet behind his defense table, partially obstructed from the jury box. You can’t completely block Rajabba from view. You can only wish to contain him. [New York Times]

* The government has warned attorneys for former Madoff employees not to use money that might be associated with Madoff’s Ponzi scheme. That includes, for their own health, any ass pennies. [ABA Journal]

* The Fourth Circuit rules in favor of a pundit-professor, in a case about the free speech rights of faculty members at public universities. [Chronicle of Higher Education]

* Charlie Sheen is trying to trademark his catchphrases now. He’s overexposed like a frostbitten penis — is there anything funny left to say about him at this point? (We might try; check in later.) [Forbes]


Matthew Kluger

There’s no contest today for Lawyer of the Day honors. The clear winner is Matthew Kluger, a former associate at three leading law firms, who has been charged in a massive insider trading case. Kluger stands accused of reaping more than $32 million in profit over the course of a 17-year conspiracy, which also allegedly involved a trader, Garrett Bauer. (Kluger and Bauer might not be as big as Raj Rajaratnam, who’s pretty hefty, but their supposed scheme is nothing to scoff at.)

The charges were filed by Paul Fishman, U.S. Attorney for New Jersey (disclosure: my former office). Fishman claims that Matt Kluger passed along insider information that eventually made its way, via an unnamed co-conspirator, to Garrett Bauer, who traded on it. According to the complaint, Kluger and Bauer invested more than $109 million in the scheme, which yielded profits of more than $32.2 million.

Where did Kluger allegedly obtain the inside information? From the three Biglaw firms where he once worked on M&A deals….

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Raj Rajaratnam

* The epic insider trading trial of Raj Rajaratnam got underway today. Bess Levin, of our sister site Dealbreaker, comes up with a (rather hilarious and bizarre) list of possible character witnesses for Raj. [Dealbreaker]

* Speaking of the Rajaratnam trial, who were those mystery men observing the proceedings in the courtroom? [Clusterstock]

* In other insider-trading news, a former Dewey & LeBoeuf associate, Todd Leslie Treadway, has been hit with civil insider-trading charges by the SEC. [National Law Journal via WSJ Law Blog]

* Talk about a benchslap: “Mr. Redlich continues to display an apparent disregard for the time and resources that this court must expend in interpreting his poorly-drafted pleadings and analyzing his sloppily-constructed and thinly-researched memoranda.” [Albany Times-Union]

* Four important lessons, for lawyers and technologists, that can be drawn from Michelangelo’s sculpting of The David. [Ben Kerschberg / Forbes]

* Musical chairs: Sean Patrick Maloney — former aide to Governor Paterson, Governor Spitzer, and President Clinton, and a former candidate for New York Attorney General — joins Orrick from Kirkland. [Orrick (press release)]

* Did you know that March is Women’s History Month? [In Custodia Legis]

* On a more festive note, Happy Mardi Gras! [Twitpic]

* Congratulations to Omar Ha-Redeye of Law Is Cool, winner of the 2010 Blawg Review of the Year. [Blawg Review]

Ed. note: This is the latest installment of Inside Straight, Above the Law’s column for in-house counsel, written by Mark Herrmann.

First, a shameless plug; then, back to business.

The plug: I’ll be giving my “book talk” about The Curmudgeon’s Guide to Practicing Law in several locations in the next couple of weeks, including in a conference room at Skadden and in auditoriums at the law schools of Northwestern and Indiana University. If you have a group that might be interested in the talk, please contact me. We’ll sneak you into one of the upcoming talks, and you can decide whether my spiel would actually fit your occasion.

Now, the business. And it’s real business this time around — a business issue that has caught the attention of an awful lot of in-house counsel. The issue has to do with the Financial Accounting Standards Board’s deliberations over whether to alter corporate disclosures about loss contingencies. (Sorry, guys. No pictures of naked Canadian judges after the jump here. You’ve gone from the sublime to the ridiculous, or vice versa.)

Here’s the backstory: Investors legitimately want to know whether companies are about to lose a ton of money in litigation. So investors want companies to make fulsome disclosures about their “loss contingencies,” which picks up a lot of territory, including pending or threatened litigation.

Companies, on the other hand, are reluctant to disclose publicly that they anticipate losing a lawsuit. If companies were to make that type of disclosure, their litigation opponent would be energized and the settlement value of the case would skyrocket….

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They had to know. But the attitude was sort of, ‘If you’re doing something wrong, we don’t want to know.’

Bernard Madoff, speaking about the banks and hedge funds that invested in his Ponzi scheme, in his first for-publication interview since his December 2008 arrest (via Dealbreaker).

* An interesting interview with Professor Benjamin H. Barton about his new book, The Lawyer-Judge Bias in the American Legal System, which demonstrates what many laypeople suspect: namely, that the legal system is rigged to benefit lawyers over the public. Professors Barton and Reynolds discuss why this might be the case and also compare the legal to the medical profession in this respect. [Instavision with Glenn Reynolds / PJTV]

* Eric Turkewitz channeling Mayor Michael Bloomberg: “Look, let’s be blunt here. Who is in a better position to pay the costs of an injury if a city bus injures people? Our strapped city budget, or the victims?” [New York Personal Injury Law Blog]

* Obama says drug legalization is worth a debate. For those scoring at home: we can talk about legalizing drugs, but we can’t talk about controlling guns. [Huffington Post]

* Meanwhile, Florida criminalizes… bath salts? Bonobo Bro has the winning blurb: “Check out this example of the brocist nanny state trying to get in the way of spring break, bath salts that have cocaine like effects and a few other of the principals this great nation was founded on.” [WJHG]

Fred Thompson

* Rep. Mike Pence of Indiana won’t seek the Republican presidential nomination in 2012. [Politico]

* Speaking of former Republican presidential hopefuls, Fred Thompson prepares to lobby on behalf of trial lawyers. Seriously. Cancel Law & Order and the universe starts breaking down. [WSJ Law Blog]

* The number eight proves lucky for one taker of the New Hampshire bar exam — and the number $140,000, not so lucky. After passing the NH bar exam on his eighth try, the debt-laden lad gets dinged on character and fitness — a familiar tale by now. [Legal Profession Blog via ABA Journal]

* Gotta love it when Jamie Dimon gets catty. [Dealbreaker]

* A corporate partner in the Moscow office of Baker Botts apparently took his own life. John Sheedy, R.I.P. [Am Law Daily]

Ted Cruz

A new year, a new job. That seems to be the thinking of many within the legal profession, based on the proliferation of professional moves we have to report (and not just out of Howrey).

We’ll start with one move that’s aspirational rather than actual. Legal and political superstar Ted Cruz — the Morgan Lewis partner who heads the firm’s Supreme Court and appellate practice, and who was recently named one of the 25 greatest Texas lawyers of the past 25 years — will run for the U.S. Senate seat being vacated by the good senatrix Kay Bailey Hutchison (R-TX). Check out the announcement on his website, or read this BLT post.

Like many lawyers turned politicians, including our current president, the 40-year-old Cruz is a Harvard Law grad (and one of The Elect — Rehnquist / OT 1996). Graduates of HLS’s rival to the south, Yale Law School, tend to take more quirky paths.

Yul Kwon

That brings us to the second move of the day. YLS grad Yul Kwon — a former Second Circuit clerk and McKinsey consultant, the first Asian-American winner of Survivor, and one of People’s “sexiest men alive” (in 2006) — has left the Federal Communications Commission. Kwon served as deputy chief of the consumer and governmental affairs bureau at the Commission.

Instead of working at the FCC, Kwon, 35, will be regulated by it: he’s going to be the host of a new television series on PBS, America Revealed (which sounds pretty cool). Read more from the FCC (press release), Bloomberg, and the Washington Post.

More moves — a Cravath partner’s jump over to Wall Street, and the defection of many McDermott energy lawyers to Cadwalader — after the jump.

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(Including the energy lawyers going from MWE to CWT.)

There was a time in this country where the holiday season was a time to be rewarded for a good year of work. People received bonuses. People received pay raises, so their salaries could keep pace with their growing experience and maturity (or at least keep up with inflation).

The America where that kind of stuff happened now only exists in memory. In post-recession (or mid-double-dip-recession) America, the holidays are a time when the people at the top jealously guard their wealth, while everybody else tries to figure out how to make “sacrifices” for the greater good.

Usually, this type of thing can be seen most clearly in the private sector (click here for Above the Law’s coverage of bonus season). But today the Obama administration is getting into the holiday spirit by freezing salaries on federal employees for two years.

So, if you’re a J.D. holder who joined the Department of Justice or another federal agency to escape the Biglaw recession, the pay cut you thought you were signing up for just got bigger.

And it probably also means that a few federal attorneys will be trying to get back into the private sector — which will be great, because it’s not like the market for attorneys is oversaturated or anything….

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