Jerome Ringler Has Taken-On Metrolink Train Accidnets Before

$9 Million Awarded in Train Crash

Riverside woman’s suit is the first of more than100 to go on trial in the 2002 Placentia wreck.

By Caitlin Liu and Christine Hanley

Read More

Metrolink Train Crash Attorney Jerome Ringler Won Before

Universal to Pay $12 Million in Metrolink Crash

Plaintiff was among 32 passengers injured in Burbank wreck blamed on a driver for the firm.

By Jean Guccione
Times Staff Writer

Read More

Southern California Train Wreck

Metrolink worker sued Burlington Northern Santa Fe, saying his alcoholism returned after the fatal 2002 Placentia collision.

A metrolink conductor who said his drinking problems resumed after the Placentia train crash in 2002 will receive $8.5 million to settle his lawsuit against one of the nations largest railroads.

Patrick Phillips of Riverside agreed Tuesday to settle his suit against Burlington Northern Santa Fe Railway Co. The case was set to go to trial next week in Orange County Superior Court.

Phillips, now 52, suffered minor head injuries the morning of April 23, 2002 when a Burlington Northern Freight train crashed into a Metrolink commuter train in Placentia. Three people died and more than 260 were injured in the early morning crash.

Though his injuries were slight, the conductor alleged that the trauma was serious enough to trigger a resurgence of his severe alcoholism, which he said he had controlled since rehabilitation in the early 1990's.

"I have never seen a case like this in 30 years, yet it is indeed what happened here," said Jerome L. Ringler, Phillips' attorney.

"We had extensive medical evaluations by a variety of neurological specialists. All were in accord that his injury, although minor, changed his behavior."

After the train crash, Phillips was hospitalized for evaluation but released about two hours later, Ringler said. In the months after the crash, however, Phillips allegedly resumed his alcohol abuse, resulting in at least two other hospitalizations.

Ringler said his client was finally diagnosed with alcohol-related dementia, a sever mental deficiency.

Phillips, who is now disabled after working 12 years for Metrolink, was unavailable for comment. He is living with a sister in Riverside.

Under terms of the settlement, Phillips will receive $8.5 million, including interest, paid out over 20 years. The amount is worth about $4.5 million in today's dollars.
Officials for Burlington Northern Santa Fe, one of the nations four largest railroads, confirmed the settlement but declined to discuss the case.

Phillips' lawsuit is one of more than 100 Civil cases stemming from the Placentia crash, which federal investigators said was caused by an inattentive Burlington Norther crew that missed a warning signal.

The lawsuits allege the collision could have been prevented by an automatic braking system, long sought by the federal National Transportation Safety Board.
They also contend that the freight train crew was fatigued by overwork and that the Burlington Northern conductor had a history of losing track of signals.

In December, an Orange County jury awarded Pamela Macek, 53, also of Riverside, about $9 million in damages for psychological and physical injuries suffered in the crash. Her case was the first to go to trial.

Giant Law Blog List

Giant Law Blog List

Law Firm News

Legal News For The Soul

Celebrities and the Law

Online Legal News & Law Firm in the News

Legal News Blog

Law Firm News, Legal Information and Marketing Blog

Lawfirm Blog

American Legal News

Legal Information Blog

Legal Insight

Legal Tax News

In Depth Legal Marketing Information

Lawyer Marketing and Public Relations

Court Reverses $78.9M Verdict Against DirecTV

The Federal Circuit overturned a $78.9 million verdict against DirecTV (Wikipedia Entry) in a patent dispute with California-based Finisar Corp. over broadcasting technology.

Finisar's patent covers a system for broadcasting video and audio programs through high-speed satellite or cable links.

A jury in 2006 concluded that DirecTV (DirecTV Website) had willfully infringed on seven patent claims and awarded Finisar $78.9 million as "reasonable royalty damages."

In vacating the award, the federal appeals court said the district court had misinterpreted "vital terms" in each of the patent claims.

The appellate judges vacated and remanded with instructions for the lower court to re-evaluate infringement and validity for six of the claims

Surgeon Could Lose License Over Sex With Patient

SAN DIEGO -- A prominent North County surgeon could be in trouble with the state medical board and learned he could lose his license.

Dr. Dennis Nigro is the subject of a hearing at the state building in which he is accused of having sex with a patient.

Nigro admitted to having a brief affair with a woman in 2003, but said she was no longer in his care during their relationship.

Nigro’s Medicare defense attorney, Michael Khouri, said, “The woman does not believe Dr. Nigro was her doctor when the sex occurred.”

“There is documentation required to terminate relationship. It was not done in this case,” said Deputy Attorney General Mary Agnes Matyszewski.

An administrative law judge will issue a proposed decision that will be sent to the state medical board for final disposition.

Nigro’s license could be suspended if discipline is deemed necessary.

On the subject of the "worst five things a doctor can do," Steve Alexander provided the Investigation Team the list of the "worst five" and then commented on each individual item. There were no specific cases or doctors mentioned in the course of this interview. Among the items provided by Mr. Alexander as one of the "worst five things a doctor can do," was a sexual relationship between a doctor and his or her patient. Clearly, in reporting the allegations against Dr. Dennis Nigro there was no intention or effort to tie Alexander’s separate interview specifcally to the Dr. Dennis Nigro case.

Legal Immigrants, Until They Applied For Citizenship

Dr. Pedro Servano always believed that his journey from his native Philippines to the life of a community doctor in Pennsylvania would lead to American citizenship.

But the doctor, who has tended to patients here in the Susquehanna Valley for more than a decade, is instead battling a deportation order along with his wife.

The Servanos are among a growing group of legal immigrants who reach for the prize and permanence of citizenship, only to run afoul of highly technical immigration statutes that carry the severe penalty of expulsion from the country. For the Servanos, the problem has been a legal hitch involving their marital status when they came from the Philippines some 25 years ago.

Largely overlooked in the charged debate over illegal immigration, many of these are long-term legal immigrants in the United States who were confident of success when they applied for naturalization, and would have continued to live here legally had they not sought to become citizens.

''It's no wonder there are so many illegal immigrants,'' said Brad Darnell, an electrical engineer from Canada living in California who applied for citizenship but is also now fighting deportation. ''The legal method is so intolerant and confusing.''

A legal immigrant since 1991, Mr. Darnell is married to an American and has two American-born sons. But after he presented his naturalization application last year, Mr. Darnell discovered that a 10-year-old conviction for domestic violence involving a former girlfriend, even though it had been reduced to a misdemeanor and erased from his public record, made him ineligible to become a citizen -- or even to continue living in the United States.

Since 1996, when an immigration law overhaul first brought intensified scrutiny of citizenship applications, at least 85,000 naturalizations have been turned down each year.

The record year was 2000, when 399,670 applications were denied, one-third of those presented, according to an analysis by the Migration Policy Institute, a nonpartisan research organization. More recent denial rates remain high, but have fallen from the peak because more immigrants have prepared with civics classes and immigrant advocates before applying to become citizens, researchers said.

In three recent cases in Florida, aspiring citizens thought their green cards entitled them to vote or register to vote before they were sworn in as Americans. When the immigrants reported their elections activities on their applications, not only were their naturalizations rejected, but they were also ordered to leave the country, according to their lawyer, Jeffrey Brauwerman.

In a current Florida case, a British-born businessman saw his naturalization derailed and was detained for deportation because he forgot to update his home address with the immigration agency, Mr. Brauwerman said. He was charged with ignoring a notice in which immigration examiners mistakenly accused him of a felony he had never committed.

In a case that drew Congressional attention this year in Illinois, Marin Turcinovic, an immigrant from Croatia, was twice denied citizenship because he did not show up at the immigration office to be fingerprinted. As his lawyer explained to no avail, Mr. Turcinovic was a quadriplegic, dependent on a ventilator and unable to leave his home.

Mr. Turcinovic died in April 2004 without becoming a citizen, creating an immigration crisis for his French widow, Corina, who had taken care of him. In January Representative Daniel Lipinski, Democrat of Illinois, presented a bill that halted her deportation.

Immigration officials say denials have increased in the last decade because naturalization applications are increasing. They note that approvals are rising as well. In 1996 naturalizations soared for the first time to more than one million, and they remained above 450,000 each year through 2007.

''Whenever we see a period when large numbers decide to apply, there tend to be larger numbers of people who are not ready or might not meet the requirements,'' said Chris Rhatigan, a spokeswoman for Citizenship and Immigration Services.

Officials said the majority of denials went to applicants who failed a required civics and English language test or fell short of residency requirements. Those immigrants generally can try again.

But as the case of the Servano family illustrates, some denials come as a shock to both the applicants and the communities they call home.

Dr. Servano's mother, five siblings and eight of his wife's siblings became naturalized citizens, including one brother and two brothers-in-law who made careers in the Navy. His four children are Americans by virtue of being born here. He has been a legal immigrant in the United States for 25 years.

Following an outcry from neighbors, patients and local officials, Department of Homeland Security officials in December temporarily suspended the Servanos' deportation. The Servanos and their supporters, including Senator Arlen Specter, Republican of Pennsylvania, are using the unusual reprieve to pursue new legal efforts to resolve the couple's case.

Dr. Servano and his wife, Salvacion, lived for years in the United States with no inkling they might have violated the law. They met in the Philippines when she was a nurse and he was a young traveling doctor. Her strict father insisted she marry, they said, but his family wanted him to wait.

In the early 1980s, their mothers came separately to the United States as legal immigrants and petitioned for residence visas, known as green cards, for Pedro and Salvacion under the category of unmarried children. But between the time the visas were requested and when they were issued in 1985, Pedro and Salvacion, hoping to escape conflicting parental demands, secretly married in the Philippines.

Unaware that their marriage could have violated the terms of their green cards, the Servanos settled in the United States. He completed a second medical residency here and began to practice in blue-collar towns where he made house calls and was known for attention to everyday ills. He and Salvacion married in New Jersey in 1987. They renewed their green cards punctually.

''My goal is to be fully functional and integrated into the society,'' Dr. Servano said. They presented their 1991 naturalization applications without seeking a lawyer.

Feds may appeal biotech patent ruling

The federal office that regulates patents is considering whether to appeal a court decision this month that threw out proposed rules that would limit how many times companies can resubmit patent applications. The biotechnology industry vociferously opposes the changes.

A U.S. district court in Virginia on April 1 ruled against the U.S. Patent and Trademark Office, agreeing with international pharmaceutical company GlaxoSmithKline, which argued that proposed changes to the patent process would prevent the industry from protecting new inventions.

Last fall, the patent and trademark office approved regulatory rule changes that limited the number of times a patent application can be resubmitted. The rule changes also limited applications to 25 claims -- the items named in a patent that define the diseases a new drug will treat, and the scope of the intellectual property. In the past, claims and continuations have been unlimited, allowing the biotech industry to protect a wide range of clinical applications.

The biotech discovery process is very different than designing a machine or computer program where the intent and use of the invention is known from the beginning. Patent applicants often add information to an application as new clinical data comes in. While a drug cannot be modified after the application, the scientist may collect additional clinical data, conduct a literature search to provide new findings from the field or dig through old lab notebooks for evidence that their drug will hit the specific disease targets named in the application.

Girl in Polygamist Sect Says She Was Beaten

Court documents say the 16-year-old girl whose call triggered the police raid on a polygamist sect's Texas compound said that her husband beat her.

The San Angelo Standard-Times newspaper is citing the court documents as also saying the girl was the seventh wife of a sect member who is named in an arrest warrant on possible abuse charges.

The newspaper says the girl told authorities at a family violence shelter that her husband hit her in the chest and choked her while another woman held her infant child at the sect's Yearn for Zion Ranch.

Court documents on file Tuesday were the basis for Child Protective Services' request that a judge grant it custody of all 401 children removed from the ranch.

America's Best TV Judges

Ms. Sylva is a distinguished lawyer, activist, public servant and dynamic TV personality. She was the first woman and the youngest elected council woman to the City Council, City of Hawaiian Gardens, served as Mayor, Vice-Mayor, and as a Member of the Board of Directors of the Hawaiian Gardens Redevelopment Agency.

Dog's Legal Guide

Everything you need to keep your pooch (or the neighbor's) on a legal leash!

America's estimated 50 million dogs are governed by many things: The stomach, the nose and the law -- laws that you as a dog owner, or as the neighbor of a dog, need to know.

Every Dog's Legal Guide is a newly revised, up-to-date practical guide to the legal issues that affect dogs, their owners and their neighbors every day, including:

• dog owners’ liability for injuries
• dogs that bite or create a nuisance
• animal cruelty
• landlords, tenants and dogs
• traveling with dogs
• providing for pets at death
• dealing with veterinarians
• your rights when buying or selling a dog
• restrictions on dangerous dogs
• vaccinations, licenses and other local laws
• guide, signal, service and therapy dogs

The latest edition of Every Dog's Legal Guide is completely updated with the latest laws of your state that affect your canine.

Appeals court may let NSA lawsuits proceed

A federal appeals court on Wednesday appeared unwilling to end a pair of lawsuits that claim the Bush administration engaged in widespread illegal surveillance of Americans.

The 9th U.S. Circuit Court of Appeals repeatedly pressed Gregory Garre, the Bush administration's deputy solicitor general, to justify his requests to toss out the suits on grounds they could endanger national security by possibly revealing "state secrets." Judge Harry Pregerson wondered: "We just have to take the word of members of the executive branch that it's a state secret. That's what you're saying, isn't it?" A moment later Judge Michael Hawkins suggested that granting the request could mean "abdication" of our duties. At the heart of both cases is the U.S. Justice Department's argument that any lawsuit claiming illegal activity on behalf of AT&T and the National Security Agency--even if the eavesdropping is known to have taken place--cannot proceed because it could let enemies and terrorists know how the government's surveillance apparatus works. It "could compromise the sources, methods and operational details of our intelligence gathering capabilities," Solicitor General Garre said. In the first case, called Hepting v. AT&T, the Electronic Frontier Foundation and other attorneys had filed a class action lawsuit against AT&T saying it unlawfully opened its networks to the NSA.

Last summer, U.S. District Judge Vaughn Walker in San Francisco ruled that it could proceed.

The second case, Al-Haramain Islamic Foundation v. President Bush, is unique: it involves a classified document that the U.S. Treasury Department accidentally turned over to an attorney for the foundation. The top-secret document showed, according to the group, "Al-Haramain and its attorneys had been subjected to warrantless surveillance in violation of (federal law)."

They responded by filing another lawsuit in February 2006 alleging violations of the Foreign Intelligence Surveillance Act. The Justice Department says the Al-Haramain case must be thrown out because it, too, could endanger state secrets. The foundation's attorneys must not even be allowed to refer to it, government attorney Thomas Bondy said Wednesday, because their "mental recollections of the documents are also out of the case."

"I'm feeling like Alice in Wonderland," replied Judge M. Margaret McKeown. While no decision was announced Wednesday, and a final ruling might not be reached for months, a three-judge panel of the 9th Circuit pressed prosecutors to justify asking that the case be dismissed based on declarations submitted by senior Bush administration officials. (All three judges are Democratic appointees.) "The bottom line here is that once the executive declares that certain activity is a state secret, that's the end of it?" Pregerson asked. "No cases, no litigation, absolute immunity? The king can do no wrong?"

The conversation occasionally took bizarre turns, such as when the attorneys and the judges knew the contents of confidential documents they had all reviewed--but could not discuss those contents in a courtroom with reporters and the public in the audience. Another odd twist was the repeated reference to the Bush administration's public claim that there is no widespread surveillance of Americans--meaning a kind of suspected electronic dragnet that would permit the NSA to sift through a large chunk of Internet communications. Last April, retired AT&T employee-turned-whistleblower Mark Klein described just that kind of arrangement at an AT&T switching facility in downtown San Francisco on Folsom Street.

Circuit Applies New Test for Declaratory Judgment

The Federal Circuit Court of Appeals recently reversed a district court’s dismissal of a declaratory judgment action, relying on the Supreme Court’s decision in MedImmune Inc. v. Genentech Inc., 127 S.Ct. 764 (2007). See Micron Technology, Inc. v. MOSAID Technologies, Inc., 2008 WL 540182 (Feb. 29, 2008)

Micron was one of the four largest manufacturers of dynamic random access memory (DRAM) chips. Micron, together with Samsung Electronics Company, Ltd, Hynix Semiconductor, Inc., and Infineon Technologies of North America, controlled seventy-five percent of the worldwide market for these chips.

MOSAID held patents on the circuit technology that was used in the manufacture of DRAM chips. In 2001 and 2002, MOSAID sent a series of four letters to Micron inviting Micron to license MOSAID’s patents.

After sending letters to all four of the manufacturers who declined to enter into licenses with MOSAID, MOSAID began patent infringement litigation against each of the manufacturers.

MOSAID first sued Samsung. Infineon then sued MOSAID for declaratory judgment of noninfringement. MOSAID and Samsung settled. MOSAID then sued Hynix, who later settled. MOSAID then settled with Infineon. In each settlement, MOSAID granted the manufacturer a license under its patents. MOSAID made statements in public and in its 2005 annual report that it intended to “aggressively” pursue all other DRAM manufacturers to force them to license MOSAID’s technology, and that it would be “unrelenting” in its litigation strategy. The industry believed that Micron was the next target of MOSAID.

In July 2005, Micron filed a declaratory judgment in the Northern District of California seeking a declaration of noninfringement of 14 patents owned by MOSAID. The following day, MOSAID sued Micron and two other defendants, in the Eastern District of Texas, for infringing seven patents. MOSAID later added one more defendant and three more patents to the Texas action.
MOSAID then moved to dismiss the California action for lack of subject matter jurisdiction. The district court granted MOSAID’s motion on the grounds that Micron had no reasonable apprehension of being sued by MOSAID. The district court found that there was no evidence of threats from MOSAID to Micron for the last four years, no threats from MOSAID to Micron’s customers, and no public statements by MOSAID that it intented to sue Micron.
Micron appealed and the Federal Circuit reversed.

The court first held that the district court in California did have subject matter jurisdiction over the case. The district court had applied the wrong test – the “reasonable apprehension” test is not the proper test, according to the Supreme Court in MedImmune. The correct test, which the appellate court repeatedly stated “is more lenient,” is “whether the facts alleged under all the circumstances show that there is a substantial controversy between parties having adverse legal interests of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” Micron, quoting MedImmune, 127 S.Ct. at 771.

In applying this test, a district court must look at the evidence of all of the circumstances. In this case, the evidence included the series of letters from MOSAID to Micron, the previous suits from MOSAID against the other three manufacturers, and MOSAID’s public statements of its intent to aggressively pursue litigation against the remaining manufacturers.

Top Court Considers D.C. Handgun Ban

The U.S. Supreme Court heard oral arguments Tuesday in a challenge to a District of Columbia ban on handgun ownership, a case that may impact gun ownership rights nationwide. The specific question before the Court in Heller v. District of Columbia is whether the Second Amendment forbids the District of Columbia from banning private possession of handguns while allowing possession of rifles and shotguns.

The Los Angeles Times reports that the case has drawn national attention "because the Court may decide for the first time whether gun rights are truly protected by the Constitution, like the right to free speech and the right to freely practice one's religion." A Washington Post article finds that there is little in the public record to predict how the nine U.S. Supreme Court Justices will vote on proper interpretation of the Second Amendment. The Court is expected to issue a decision on the case by the end of June.

Hiring Lawyers by the Numbers

Many companies are instituting new policies for hiring outside counsel -- policies that are making some general counsel squirm and some law firm lawyers shudder.

Under pressure to control expenditures for legal services, general counsel are increasingly called upon to explain their outside counsel hiring practices and the resulting costs to their clients.

More important, while in the past the details of hiring decisions may have been left up to general counsel and their law departments, now many corporate employers are getting involved.

Some corporations are implementing policies that mandate that their procurement or purchasing departments become involved in every decision to outsource services -- including legal work -- says Ron Friedmann, president of Prism Legal Consultants Inc.

Some outside counsel say that this increased involvement by purchasing and procurement departments has resulted in a "commoditization" of legal services -- corporate clients purchasing legal services much like commodities.

"There's a movement right now, across the board, to pay the lowest price you possibly can," says Ed Hansen, a partner in the global outsourcing and technology practice at Morgan, Lewis & Bockius. "On the surface, it seems like a good idea, but companies aren't able to differentiate what's a commodity and what's not. You can't buy outsourcing services like you buy pencils."

Hansen calls outside counsel services "relationship-based contracting," and says those contracts can fail when the GCs need to work internally with management or departments like procurement or purchasing come between in-house and outside counsel.

THE CHALLENGE
"Unlike other portions of the company that can be easily measured and quantified, it's very difficult to quantify legal services," says Susan Hackett, general counsel of the Association of Corporate Counsel. Legal services have value beyond the billed hourly rate, although that value is tough to measure.

"How do you measure the troubles the company didn't experience?" says Hackett. "How do you prove the value of, 'We didn't have an SEC investigation this year'?"

Procurement or purchasing employees who are not part of the legal department may find it difficult to appreciate or even understand those values. They may also find it hard to differentiate between a straightforward legal task that could be performed by most corporate lawyers and one that requires involvement by a trusted legal adviser who may be familiar with the company's legal needs or who has particular expertise.

The procurement department is often brought in because some corporations understand that their attorneys aren't that great with numbers, budgets and purchasing, Friedmann says.

Management may think that attorneys tend not to negotiate legal costs and decide to step in. "When purchasing departments see how lawyers operate, they see low-hanging fruit," Friedmann says. For the cost-conscious company, legal services present an easy way to reduce costs.

Yet this focus on cost-cutting may threaten the trusted relationship between in-house counsel and outside attorneys.

"Securing outside counsel is such a personal decision," says Hansen, and involving procurement people in the process "is like using the procurement department to hire an employee." When costs are the deciding factor in hiring outside counsel, the value of hiring someone trusted and familiar to do the job -- not to mention someone whom the law department can work with -- is often discounted.

Hansen recalled a complex telecommunications deal for a large corporate client where he not only negotiated the original contract, but also renegotiated it two years later when the provider threatened the client with litigation.

Hansen successfully resolved the issue, even netting the client some money in the process. Yet when the contract was up for renewal, Hansen received a surprise: a request for proposal for legal services.

As part of its efforts to cut costs, the company required that outside counsel hiring decisions be made with the involvement of the procurement department. Hansen was outbid and replaced on the deal he had originally crafted by a lawyer whose bid was just 10 percent of Hansen's price for the job, despite corporate counsel's insistence that Hansen handle the contract and appeals to the chief information officer and a vice president to try to get him hired.

The contract at issue was ultimately renewed without much renegotiation.

Merely looking at costs is not always the best way to choose outside counsel, Hansen says. Procurement employees who don't have a legal background are often unable to differentiate between attorneys and may ultimately outsource to a new attorney without the skills and trust required for the job, simply on the basis of lower costs.

"A procurement group is not capable of differentiating between top players," Hansen says. "They don't understand that their skill sets need to be separated, and are also incapable of differentiating between top and bottom players."

Legal services are different from other services, Hansen adds, and while "a lot of legal work is in the nature of a commodity, the procurement groups can't differentiate." As a result, difficult, detailed or important cases may be outsourced to unqualified attorneys, even though they may require more seasoned or familiar outside counsel.

Hackett agrees that there's something different in what lawyers do, but said it's difficult to put a finger on what that difference is -- and even more difficult to put it into words and relay it to management.

Legal services are different from others because of the professional and ethical traditions that characterize the field, yet, "I don't see people always living up to that," said Hackett. "We need to rediscover what made us different in the first place."

THE SOLUTION
"One of the challenges is balancing how well the outside firm knows the company's business with how cost-effective they are overall," Friedmann says.

General counsel are in a unique -- and uniquely difficult -- position: Although they are obviously concerned with getting the best legal services possible, they also answer to management on costs, just like any other department.

"It's clear that corporations are increasingly looking at ways to save money, and law departments are cost centers and need to be managed as cost centers," Friedmann explains. "A forward-thinking general counsel should look to the purchasing department for help."

While procurement or purchasing department involvement with hiring outside counsel can lead to tension, savvy general counsel shouldn't ignore the purchasing department's interest and expertise. Rather, in-house counsel should work together to balance the company's cost-cutting needs with their preferences for outside counsel.

Hackett says coming up with unique models for comparing legal services might be the key to that balance.

"The 'counting pencils standard' doesn't apply, but that doesn't mean legal services don't need to be measured," Hackett says. "They just need to be measured differently."

General counsel should look for ways to quantify legal services that will steer the procurement department toward measuring results, not just costs.

Circuit Applies New Test for Declaratory Judgment

The Federal Circuit Court of Appeals recently reversed a district court’s dismissal of a declaratory judgment action, relying on the Supreme Court’s decision in MedImmune Inc. v. Genentech Inc., 127 S.Ct. 764 (2007). See Micron Technology, Inc. v. MOSAID Technologies, Inc., 2008 WL 540182 (Feb. 29, 2008)

Micron was one of the four largest manufacturers of dynamic random access memory (DRAM) chips. Micron, together with Samsung Electronics Company, Ltd, Hynix Semiconductor, Inc., and Infineon Technologies of North America, controlled seventy-five percent of the worldwide market for these chips.

MOSAID held patents on the circuit technology that was used in the manufacture of DRAM chips. In 2001 and 2002, MOSAID sent a series of four letters to Micron inviting Micron to license MOSAID’s patents.

After sending letters to all four of the manufacturers who declined to enter into licenses with MOSAID, MOSAID began patent infringement litigation against each of the manufacturers. MOSAID first sued Samsung. Infineon then sued MOSAID for declaratory judgment of noninfringement. MOSAID and Samsung settled. MOSAID then sued Hynix, who later settled. MOSAID then settled with Infineon. In each settlement, MOSAID granted the manufacturer a license under its patents. MOSAID made statements in public and in its 2005 annual report that it intended to “aggressively” pursue all other DRAM manufacturers to force them to license MOSAID’s technology, and that it would be “unrelenting” in its litigation strategy. The industry believed that Micron was the next target of MOSAID.

In July 2005, Micron filed a declaratory judgment in the Northern District of California seeking a declaration of noninfringement of 14 patents owned by MOSAID. The following day, MOSAID sued Micron and two other defendants, in the Eastern District of Texas, for infringing seven patents. MOSAID later added one more defendant and three more patents to the Texas action.
MOSAID then moved to dismiss the California action for lack of subject matter jurisdiction. The district court granted MOSAID’s motion on the grounds that Micron had no reasonable apprehension of being sued by MOSAID. The district court found that there was no evidence of threats from MOSAID to Micron for the last four years, no threats from MOSAID to Micron’s customers, and no public statements by MOSAID that it intented to sue Micron.
Micron appealed and the Federal Circuit reversed.

The court first held that the district court in California did have subject matter jurisdiction over the case. The district court had applied the wrong test – the “reasonable apprehension” test is not the proper test, according to the Supreme Court in MedImmune. The correct test, which the appellate court repeatedly stated “is more lenient,” is “whether the facts alleged under all the circumstances show that there is a substantial controversy between parties having adverse legal interests of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” Micron, quoting MedImmune, 127 S.Ct. at 771.

In applying this test, a district court must look at the evidence of all of the circumstances. In this case, the evidence included the series of letters from MOSAID to Micron, the previous suits from MOSAID against the other three manufacturers, and MOSAID’s public statements of its intent to aggressively pursue litigation against the remaining manufacturers.

The Lateral Partner Power Play

Are law firms spending too much time and money branding the firm? We argue that in the age of the portable professional, strategies for promoting, retaining and attracting lateral partner talent — similar to the investment services model — is the path to long-term success.

How does a firm attract top lateral partners with large portable practices and at the same time retain its rainmakers? The solution is the same for both—demonstrate to potential and existing partners that the firm is focused on their success.

Wall Street clearly gets this. When Goldman Sachs reportedly paid out more than $16.5 billion in bonuses, The New Yorker explained, “talent is the most precious commodity on Wall Street; it’s what they sell, so it’s also what they have to pay for.”

At law firms, like all professional service organizations, talent is everything. But consider the difference in how much firms spend branding the firm versus what they spend branding the powerful business generators that are their individual partners.

Firms with genuine respect for their partners—and clients—never lose sight of the fact that clients hire the lawyers they trust, as opposed to law firms with letterhead they recognize. To this end, firms likely to succeed in today’s fluid market are those that view themselves as “brand marketers” rather than the “brand.”

Think of the way the Coca-Cola Company markets Coke, Diet Coke, Sprite, Dasani, or how Apple creates marketing campaigns for iPod, iTunes, and Mac. Just as General Motors bestows a hefty budget to its premier brand, Cadillac, the lateral that has been heavily wooed should expect, upon joining a new firm, to receive marketing dollars devoted to significantly increasing their value during their first year there.

Working with new laterals to develop and implement strategic, sophisticated marketing campaigns enhances their likelihood of success—and sends a clear message to other potential laterals that the firm is dedicated to helping its professionals grow their practices.

Law firms spend millions in branding campaigns in attempts to attract and institutionalize clients. Down the hall, the recruiting department, operating under the assumption that lawyers and their books of business are portable, has little or no marketing support devoted to recruiting partners.

Free agency has created a strong sellers’ market for laterals. Consider that The American Lawyer reported that between October 2005 and October 2006, 2,429 partners changed firms among the AmLaw 200—an average of 12 partners per firm!

This situation exists because clients control the state of play. As long as clients agree, lawyers are free to move as often as they like. To some extent, the legal market has always operated this way. Time and time again, in-house counsel say they hire lawyers not law firms. To avoid this attrition and client instability, firms must recognize where client loyalty lies. The key to obtaining and keeping top clients is keeping their lawyers happy.

When clients say they hire lawyers not firms, we know that practically speaking, what clients really mean is they hire great lawyers who work for “safe” firms. But what makes a firm safe? Safe means a firm with an established reputation for success; a reputation obtained by the results its individual lawyers achieve over time. By devoting marketing dollars to helping laterals solidify and expand their reputations, firms will find that clients come and stay too.

Smart firms should demonstrate to highly sought-after laterals that when they join the firm, an aggressive, sustained, customized marketing campaign will be immediately initiated on their behalf. This is an appealing commitment that’s hard to ignore.

Savvy candidates understand the importance of marketing support, and include marketing expectations in negotiations. They ask questions such as, “how many seminars will you help me produce this year?” And “how will you position my practice in the media?” And, “what will my personal branding budget be?”

Though the acquisition of lateral talent represents a significant investment in time and resources, oddly, many firms fail to engage in much business strategizing at the outset of the recruitment process. Firms frequently do not provide recruiters with enough guidance on the type of candidate likely to add true value to a firm’s current service offering.

In considering potential laterals, firm managers should carefully examine their long-term marketing plans, and identify and select candidates based on these needs. Procter & Gamble would not have purchased Gillette without a strategic marketing plan in place to leverage it. Smart firms ask difficult questions such as: “Where is our practice going, and what talent do we need to make it stronger?” “What will the debt market look like in five years, and who do we need to capitalize on that?” “What business could we get with partner ‘X’ that neither of us can get on our own?”

In an era of free agency, talent is everything. The firms that do the best job of articulating why lateral superstars will fare best with them—and then back up their plans with strategic, focused marketing support, will find they are able to successfully institutionalize the talent they need to attract the clients they want.

Is Schwarzenegger Serious About Taxing Lawyers?

California Gov. Arnold Schwarzenegger has a $16 billion budget deficit dilemma on his hands. He insists he doesn't want to cut education. But he proclaims with equal fervor that he won't raise taxes.

So what's a post-partisan governor to do? Close tax loopholes, of course.

Now one governor's loophole may be another politician's tax increase.But according to two media outlets, Schwarzenegger told the audience at a Pleasant Hill, Calif., budget forum last Wednesday that the state should consider closing tax loop-holes and in his mind that includes the lack of a sales tax on professional services -- including legal services.

"We have to look at the way we are taxing," Schwarzenegger is reported as saying. "There's whole new economies that are developing,service-oriented economies."

Asked about the comments on Thursday, finance department spokesman H.D.Palmer said the governor was just explaining that there are a lot of deficit-eliminating ideas "out there."

"Basically, it was in the context of we ought to have everything on the table as we ought to be having discussions about them sooner rather than later," Palmer said. "But we're not carrying a bill in our back pocket, if that's what you're asking."

Law Firms Opening Up to the Idea of Attorney Re-Entry

Shari Solomon was going on her fourth year as an associate in the commercial real estate department of Wolf, Block, Schorr and Solis-Cohen in 1995, when she had her third child. While she was already accustomed to juggling life as a mother and a lawyer, her newborn required extra medical attention -- so much so that she couldn't imagine working again any time soon.

But 10 years later, with all of her children in good health, Solomon was ready to return. The problem was, she didn't know if the law firm world was ready to take her back.

"I did not presume that I would be returning to my practice after that many years out," she says. "It's not that I didn't consider it. But I couldn't imagine that after that many years out, it would be an option."

She was wrong about that. When she started searching for a job, Solomon invited a WolfBlock partner she had remained friendly with to lunch. The meeting resulted in an offer to take up where she had left off a decade before, as an associate in the Philadelphia office of the firm.

But it's not as easy for everyone to come back as it was for Solomon.

While most law firms offer some form of maternity leave, it's the rare firm that guarantees jobs for more than one year. The New York City Bar Association's Committee on Women in the Profession recently surveyed 43 legal employers on parental leave and found that almost all grant some form of maternity leave, with the majority of surveyed law firms providing 12 weeks' paid leave. Many firms also offered additional unpaid time off.

By and large, however, women who want to take off more than one year often sacrifice whatever job security they have to do so. When they want to return, they face a host of formidable challenges, say industry observers.

The most significant is simply convincing a law firm to hire them even though they veered off the conventional linear law firm up-or-out path. In addition, many who left before the technological revolution worry about their computer skills. Further, re-entering lawyers also must come to grips with psycho-social factors, most significantly the fact that they're older than their fellow associates while their contemporaries are their bosses.

The ranks of women seeking to re-enter the practice of law have grown large enough that law schools and other groups are now addressing the issue. Pace Law School and University of California, Hastings College of the Law, have started programs aimed at helping attorneys return to practice after lengthy absences. Additionally, the New York City Bar recently kicked off a re-entry initiative aimed at assisting people who left the profession and are considering returning.

For firms looking to increase the ranks of women partners, reaching out to former employees is seen as one way of potentially recruiting experienced female lawyers. Some law firms have been mulling programs aimed at connecting with ex-employees since at least 2005, when a Harvard Business Review article about women in the workplace suggested that companies should maintain ties with off-ramped employees through alumni programs.

Skadden, Arps, Slate, Meagher & Flom recently started a program, Sidebar, which allows attorneys to temporarily leave the firm for three years. During that time, they're still welcome at continuing legal education classes and other firm-sponsored events on the premises.

Attorney General: IP Crimes Increasingly Funding Terror Groups

Attorney General Michael Mukasey warned March 28 that the huge profits generated from piracy and counterfeiting are increasingly flowing into the coffers of terrorist groups.

In remarks to Silicon Valley executives at the Tech Museum of Innovation, Mukasey said the economy and national security of the United States are increasingly threatened by violations involving copyrighted software code, patented inventions and trademarked properties.

Terror groups are taking their cues from organized crime and increasingly funding their operations from counterfeiting and piracy, he said.

Mukasey said his department is devoting more resources to prosecuting intellectual property crimes, which led to a 7 percent increase in the number of IP cases filed in 2007 over the year before and a 33 percent increase over 2005.

"Criminal syndicates, and in some cases even terrorist groups, view IP crime as a lucrative business and see it as a low-risk way to fund other activities," Mukasey said. "A primary goal of our IP enforcement mission is to show these criminals that they're wrong."

Before Friday's speech, he met privately with representatives from companies including Apple Inc. and Adobe Systems Inc.

Mukasey did not elaborate on the topics discussed in that meeting. The attorney general also met with entertainment industry executives in Los Angeles a day earlier during this three-day California trip, and did not discuss those talks.