White-Collar Crime

John J. O'Brien

Last August, John J. O’Brien, who was once a highly regarded and well-liked partner in the celebrated M&A practice of Sullivan & Cromwell, pleaded guilty to four misdemeanor tax offenses. The charges of conviction were mere misdemeanors, but the amounts involved were large, as you’d expect from a well-paid partner at S&C.

O’Brien was accused of failing to file income-tax returns for tax years 2001 to 2008, on almost $11 million in partnership income. In the end, he pleaded guilty to failing to file taxes relating to $9.2 million in partnership income, for tax years 2003 to 2008.

Earlier today, John O’Brien was sentenced. The sentencing hearing provided some interesting additional information about why O’Brien acted as he did.

So is O’Brien trading Biglaw for the Big House? And if so, how long a sentence did he receive?

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Paul Clement

* If defending unpopular clients is cool, consider Paul Clement Miles Davis. He’s the lead lawyer in three politically charged cases going up before SCOTUS in the new year. [LA Times]

* Joe Arpaio’s going to have a tough time racially profiling Hispanics in 2012. What’s a man to do without verification powers and the ability to detain people on suspicion alone? [WaPo]

* A summary of the NLJ’s 2011 year in review round-up: all of this was a preview of what’s to come in 2012. And what’s to come? Same sh*t, different docket number. [National Law Journal]

* C&F fail: the California Supreme Court is busy worrying about Stephen Glass, a guy who took his “creative writing” efforts a bit too far. [San Francisco Chronicle]

* The Hollywood actress suing IMDb for revealing her age has to reveal much more thanks to this ruling. She’s got two weeks to amend her complaint to include her name. [The Wrap]

* “Oh my God, the law school has gone crazy.” Don’t blame the messenger, but UVA Law’s headlines on ATL are totally self-inflicted. Here’s Elie’s take on the collar-poppin’ action. [C-VILLE]

* Larry Ribstein, partnership law guru, business law blogger, and Associate Dean for Research at the University of Illinois College Law, RIP. [Truth on the Market]

* Robert Morvillo, New York trial lawyer and white-collar defense pioneer, RIP. [WSJ Law Blog]

* John Lawrence, plaintiff in the landmark LGBT rights case of Lawrence v. Texas, RIP. [NY Times]

Matt Kluger

Here’s a Fried Frank bonus for you: Matthew Kluger, the former Fried Frank associate who sued the firm for alleged discrimination, is going to prison. As you may recall, Kluger — who also worked as an associate at other top law firms, including Cravath, Skadden, and Wilson Sonsini — was charged in a massive insider trading case this past spring. A week ago, he pleaded guilty to all four counts against him. He’ll be sentenced in April 2012.

Now, on to the matter at hand: associate bonuses in the New York office of Fried Frank. How were they this year?

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Judge Matz

[T]his Court is compelled to find that the Government team allowed a key FBI agent to testify untruthfully before the grand jury, inserted material falsehoods into affidavits submitted to magistrate judges in support of applications for search warrants and seizure warrants, improperly reviewed e-mail communications between one Defendant and her lawyer, recklessly failed to comply with its discovery obligations, posed questions to certain witnesses in violation of the Court’s rulings, engaged in questionable behavior during closing argument and even made misrepresentations to the Court.

– Judge A. Howard Matz of the Central District of California, benchslapping federal prosecutors — and vacating the convictions, and dismissing the indictment — in a high-profile Foreign Corrupt Practices Act prosecution. (Gavel bang: Daniel Fisher.)

(Additional links and information about this case — if you do FCPA or white-collar criminal work, this may be of interest to you — after the jump.)

double red triangle arrows Continue reading “Benchslap of the Day: What Not To Do If You’re A Prosecutor”

Do you believe in life after law? More specifically, do you believe in life after Biglaw?

Many former partners at major law firms spend their post-Biglaw years living large — as well they should. After all, they worked very hard, for many years, to amass seven-figure, eight-figure, or even nine-figure fortunes. After leaving behind the life of billing 2000+ hours a year, they finally have time to enjoy the fruits of their labor.

But not all ex-partners find themselves on Easy Street. Take, for example, these two ex-partners in California — one whose civil suit against her former firm isn’t going so well, and one who might be going from Biglaw to the Big House….

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Give me a break. I 'raised' 23 foster kids.

* Members of the Occupy Wall Street brigade were allowed to continue to be dirty hippies living in a park without toilets this morning. So fresh and so clean! OMG, yippee! [Wall Street Journal]

* French prosecutors have dropped another yet another rape charge lodged against Dominique Strauss-Kahn. Seriously? It looks like nothing sticks to this man except money. [CNN]

* Recognizing that it’s really hard to get someone to pick up a partner from the drunk tank when there’s a Blackberry outage, DLA Piper is thinking about switching to iPhones. [Reuters]

* RajRaj was literally the biggest target in the Galleon case, but one of his buddies was sentenced, too. On Wednesday, Michael Kimelman got 2.5 years at the luxurious Club Fed. [Daily Record]

* It took Michele Bachmann seven years to graduate from law school (whereas most graduate in three). She can get things done, but apparently only on her own time. [New York Times]

* Food fight! Things are getting really dirty in this Food Network lawsuit. Guy Fieri not only likes to cook with alcohol, but he allegedly speaks like an angry drunk behind the scenes. [City Pages]

Find out how much he got over at our sister site, Dealbreaker.

Earlier: Prior ATL coverage of Raj Rajaratnam

Ed. note: This post was written by Matt Levine, the new editor on our sister site, Dealbreaker, and Elie Mystal.

Matt here. You might think that Dealbreaker HQ exists only metaphorically in virtual space, or maybe in the fan fiction you’re hiding in your desk, but in fact Bess and I share a real physical garrett both with our sibling sites Fashionista and Above the Law. Occasionally we even talk to each other. “Talk,” in this context, normally means that Above the Law editor Elie Mystal shouts at us about some outrageous political position. In order to quiet him down a bit, we’ve decided to take it to the internet, thus spawning the first – and maybe last! – Above the Law / Dealbreaker Debate Society.

I have been set the task of defending a proposition like “white-collar criminals should not get anything near the jail time they get.” (We are pretty casual with our resolutions here at the Breaking Media Debate Society.)

Fortunately I believe that, so here goes…

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We are just finishing up our first day at the Legal Technology Leadership Summit, our tech conference aimed at in-house counsel. So far it has been a great success. We’ve had no earthquakes or hurricanes — just a passing swarm of lovebugs (seriously), which are now lying dead on my balcony.

This morning, we kicked off with a keynote session from Alan Lange and Tom Dawson, the authors of Kings of Tort (affiliate link), a chronicle of one of the legal profession’s more infamous criminals. It’s actually not that specific to technology, although it does relate to the world of in-house counsel.

Keep reading for an inside look at the politically connected Southern gentleman who transformed from David to Goliath, conspired to bribe a judge, and made many an in-house lawyer’s life miserable…

double red triangle arrows Continue reading “Dispatch from Amelia Island: Inside the Dickie Scruggs Scandal”

John J. O'Brien

Remember John J. O’Brien? Back in April 2009, we wrote about the mysterious departure of John O’Brien from Sullivan & Cromwell, where he was a well-regarded and well-liked partner in the M&A department. In a follow-up post in December 2009, we noted : “When partners leave a place like Sullivan & Cromwell, there’s often a story behind the departure.”

In our December 2009 post, we reported that John O’Brien “left Sullivan & Cromwell due to an issue relating to his taxes.” We added that the problem was personal, i.e., that it did not implicate S&C or any of its clients (unlike the fraud of another former SullCrom partner, Carlos Spinelli-Noseda, who defrauded the firm and its clients of more than $500K).

Some readers pushed back on this reporting. They claimed that John O’Brien left voluntarily and for perfectly innocent reasons. They told us to leave O’Brien alone. They accused us of harboring ill-will towards Sullivan & Cromwell (even though, to be honest, large law firms are somewhat interchangeable for us here at ATL; they’re all just potential sources of news to write about).

In light of all the flak we took for our John O’Brien coverage — similar to the criticism we received for covering Theodore Freedman’s departure from Kirkland & Ellis, a few months before Freedman got indicted by the feds — please forgive us for gloating a little. (This gloating is directed at our critics, not at John O’Brien; we have nothing against O’Brien and wish him the best of luck in moving on with his life.)

Today brings news that John J. O’Brien has been hit with federal criminal charges. Like Ted Freedman, John O’Brien has been hit with tax-related charges. But the numbers involved are larger — a lot larger….

UPDATE (7 PM): O’Brien pleaded guilty. See the update appended to the end of this post.

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