Saturday, October 31, 2009

Birther madness: lawyers behaving badly?

Filing a lawsuit is not a post on a blog. It is a claim of right and demand for remedy that compels others to respond, courts to hear, and to decide. Lawyers are the filter for such burdensome demands. The Rules of Professional Conduct therefore prescribe:

A lawyer shall not bring or defend a proceeding...unless the lawyer knows or reasonably believes that there is a basis in law and fact for doing so that is not frivolous, which includes a good faith argument for an extension, modification, or reversal of existing law, or the establishment of new law. RPC 3.1

Attorney Mario Apuzzo of Jamesburg, New Jersey thinks that rule doesn't apply to him. The Courts of the United States must compel the Congress to investigate the (plainly groundless -gwc) claim that Barack Obama is not a native born citizen, he demands on behalf of four apparently like-minded citizens. In a twice-amended complaint Apuzzo seeks to advance his personal belief that to date (Halloween 2009) 283 days have elapsed “ Since the Usurper Putative President Obama aka Barry Soetoro Unconstitutionally Took Office”.

An editorial in the New Jersey Law Journal observes:

The first named plaintiff - Charles Kerchner - a 33 year veteran of the U.S. Naval Reserves - hypothesizes that if he is recalled to active duty in a “national emergency” he ““would need to know whether the President and Commander in Chief who may be giving him orders is in fact the legitimate President and Commander in Chief and therefore obligate him to follow those orders or risk being prosecuted for disobeying such legitimate orders.”

District Judge Jerome Simandle has dismissed the complaint. (Civil No. 09-253) The plaintiffs cannot, he points out, establish “an injury in fact” - that is, a “personal stake” which can be “distinguished from the interest of the general citizenry”. Kerchner’s allegation is entirely speculative and fails to meet the constitution’s jurisdictional case and controversy requirement, according to Judge Simandle’s patient, plain, and solid ruling.

Paper accepts anything written upon it and citizens are free to rant against the wind and the tides, and to tilt against windmills. But lawyers are not free to file frivolous pleadings, to waste the time of the courts and of public servants on groundless matters.

But Apuzzo is undeterred. According to his blog he has filed an appeal in the U.S. Court of Appeals for the Third Circuit in his lawsuit against “Barack Hussein Obama, II, the United States of America, the United States Congress, the United States Senate, the United States House of Representatives, Richard B. Cheney, and Nancy Pelosi.”

Acting U.S. Attorney Paul Fishman and his staff have important business to attend to and they need not police the New Jersey bar. But the Middlesex County District VIII Ethics Committee does have jurisdiction and cause to investigate and, if warranted, to file charges against Mario Apuzzo the attorney who filed the Kerchner complaint.

RPC 3.1 suggests the question: Should an Ethics Committee commence an investigation and seek to discipline Apuzzo for filing a frivolous complaint?

Would such action deter other (presumably more rational) lawyers from testing the outer limits of the law? Would Mr. MacPherson's lawyer be vulnerable under RPC 3.1?

What constitutional provisions are relevant?

Is losing a sufficient sanction?

Federal Judicial Canon 3 A. (3) Provides "A judge should initiate appropriate action when the judge becomes aware of reliable evidence indicating the likelihood of unprofessional conduct by a judge or lawyer." Does the judge's failure to take such action dictate inaction by the District Ethics Committee?

P.S. for the discussion this post sparked at Legal Ethics Forum click HERE.

Images: facsimile of Barack Obama's birth certificate, and 1961 birth announcement in Honolulu Advertiser

Monday, October 26, 2009

Josh Marshall on the Opt-Out Compromise

Josh Marshall of Talking Points Memo thinks Sen Reid's Opt Out compromise is pragmatic: the public option will have enough mass to bargain effectively to keep costs down and to exert competitive pressure on private insurers.

HERE is his analysis.
Images: Josh Marshall and son, Sen. Harry Reid

White House: The Public Option: Rumor Check

The White House has responded on its blog to assertions that President Obama is backing down on the public option:

A rumor is making the rounds that the White House and Senator Reid are pursuing different strategies on the public option. Those rumors are absolutely false.

In his September 9th address to Congress, President Obama made clear that he supports the public option because it has the potential to play an essential role in holding insurance companies accountable through choice and competition. That continues to be the President's position.

Senator Reid and his leadership team are now working to get the most effective bill possible approved by the Senate. President Obama completely supports their efforts and has full confidence they will succeed and continue the unprecedented progress that is being made in both the House and Senate.

Dan Pfeiffer is Deputy Communications Director

Saturday, October 24, 2009

Progressive Change Campaign Presses Obama on Public Option

Like most progressives I favor a single payer system. Like most progressives I accept that we are not going to get it at this point - because too many people believe in that government that governs least is best (for reasons that escape me almost entirely).

Maine is our second home and we continually hope that Sen. Snowe and Sen. Collins will uphold the honorable tradition of the Republican Party that fought and won the Civil War. Sen. Snowe continues to be the swing vote in the Senate. She is of the view that credibility among Republicans requires her to oppose a government-sponsored health insurance company.
SupportforPublicOption.png Support for Public Option image by fayeforcure

We understand President Obama's need to get something done, and to hold Snowe in as she is the stalking horse for weak links like Joseph Lieberman and other "blue dog" Dems. But we think Sen. Snowe should listen to Maine voters. A public insurance company that pays Medicare rates plus 5% can function efficiently and put decent health insurance within the reach of the great majority of Americans.

The Progressive Change Campaign is delivering that message this weekend as President Obama presses for a weakened (and in my view not-credible) public option triggered by the (likely) failure of the private health insurers to make coverage available to all but a few.

Friday, October 23, 2009

Retirement Income and the "Ownership Society"

One of the most pernicious frauds of the Bush-Cheney era was that they were building an "ownership society". The "meat" of that was that people who could scarcely afford it were borrowing shocking sums relative to income to buy homes the equity in which was inflated by the housing bubble.

G.W. Bush said after re-election that he was going to spend his political capital to drive social security taxes into private investment funds. Thank god he threw his political capital down the drain before the free-marketeers damaged Social Security.

The Congressional Research Service has published this report "Income and Poverty Among Older Americans in 2008", released October 2, 2009. Analyst Patrick Purcell demonstrates that persons over 65 - in the second quartile in income (50% to 75%) - are principally dependent on Social Security, not investments.

9% of income is from assets, 22% from pensions (most of which are public sector). To be concrete: If you received $2,000/month from Social Security (which requires earnings at the top of the taxable income range) you would need about $400/month pension and $200,000 in investments to produce the median.

Sources of Individual Income in 2008, Second Quartile, Age 65+
2008 Individual Income of $18,208 to $33,677
Source: Both figures from CRS analysis of the March 2009 Current Population Survey.

Tuesday, October 20, 2009

Favoritism charges dog Christie campaign for NJ Governor

Christopher Christie was favored by a top Justice Department aide who accelerated charges against New Jersey politicians to make sure Christie got the political benefit for his "clean up New Jersey" campaign theme, the New York Times
suggests in a report today based on interviews with unidentified federal employees. The accommodation was pressed by his friend and top aide Michele Brown whom Christie had favored with a personal loan of $46,000.

Brown also intervened to take charge of the Freedom of Information Act requests made by Christie's opponent - Governor Jon Corzine. The acting U.S. Attorney Ralph Marra ordered Brown to give up control of the file before she resigned in the wake of disclosure of the loan by Christie.

According to the Times account Brown
took a job at a law firm with close ties to Mr. Christie — a firm that represented one of five companies identified as targets in his office’s investigation of kickbacks among makers of artificial hips and knees. Ms. Brown had led the case and, with Mr. Christie, negotiated a settlement in which the company paid a fine and avoided criminal charges.
There is no conflict of interest presented by such employment but like the loan and the other actions it suggests that friendship and partisanship are recurrent themes in Christie's dealings. A candidate running as Mr. Clean jeopardizes his chances with grandstanding and favoritism.

The United States Attorney's position in New Jersey has long been a high profile platform. In contrast the state Attorney General, an appointed officer, does not have the sweeping power or public platform that elected positions like that which brought Elliott Spitzer to the Governor's Mansion in Albany and may do the same for Andrew Cuomo.

The official history of the U.S. Attorney's Office shows that unlike Christie, who never made a secret of his gubernatorial vision, prior occupants of the office have gained prominence in the judiciary. Samuel A. Alito, Jr. and Michael Chertoff served on the U.S. Court Court of Appeals for the 3rd Circuit. Alito rose to the U.S. Supreme Court and Chertoff became Secretary of the Department of Homeland Security.
Images: Campaign poster, Christie with Michele Brown

2d Circuit bar of immigration lawyer for incompetence highlights need for government support of lawyers for detainees

The U.S. Court of Appeals for the 2d Circuit, whose docket is flooded with immigration appeals, has barred Karen Jaffe, an immigration specialist whose clients are principally Chinese. The
order cites a pattern of neglect of her clients' interests, including reliance on paralegals who themselves relied on two lawyers - one suspended and the other disbarred.

Jaffe was briefly suspended by the Executive Office for Immigration review in 2006 for making false statements to a tribunal. She was one of a group of four lawyers disciplined the same day.

The Court's disciplinary committee recommended Jaffe be given the opportunity to voluntary resign from the Circuit Court's roll. But the judges feared the situation might be misconstrued. Striking her from the roll will likely trigger reciprocal discipline by other courts.

The Circuit judges' firm action underlines their concerns that those facing deportation (who are about one-third of the court's docket) do not receive adequate representation. The problem led the New Jersey Law Journal Editorial Board to recently call for repeal of 8 U.S.C. 1362 which bars use of federal money to represent deportees. The Law Journal called for creation of a federally-funded "corps of competent lawyers" to represent deportees.

Thursday, October 15, 2009

Red State, Blue State: Lawyers, Politics & Moral Counseling

Prof. Russell Pearce, a director of the Stein Center for Law & Ethics at Fordham Law School, preaches the right, importance, and duty of lawyers incorporating their moral values in the representation of clients. Out with the hired gun, in with the ethics counselor, is the message of his new movie, which features interviews with prominent lawyers and academics.

Alienated, burned out, stressed out are common complaints among lawyers. The long term study of Indiana University Maurer Law School graduates shows that lawyers who serve in public interest and government are the most satisfied with their work-home life balance. Those who are in large firms, with the highest compensation, report the most dissatisfaction. Jeffrey Stake, et alii, INCOME AND CAREER SATISFACTION IN THE LEGAL PROFESSION: SURVEY DATA FROM INDIANA LAW SCHOOL GRADUATES, 4 Journal of Empirical Legal Studies 939 (2007)

(click thumbnail to expand image)

Russ Pearce and the Stein Center (at which I have the title Senior Fellow) have produced a film that urges lawyers to move away from the disinterested hired gun mode and toward an integration of personal moral and ethical values with one's counseling. Maybe if embraced it could reduce the family/work balance satisfaction gap between the large firm and the public interest and government practitioners.

Friday, October 9, 2009

Obama's Prize - Winning Rhetoric


James Fallows is an acute student of rhetoric, and a practitioner, of course. HERE is his analysis of the rhetoric of Barack Obama's statement on the occasion of today's announcement in Oslo by the Nobel Committee that this year's Peace Prize will go to the new President.

Friday, October 2, 2009

Trustee Picard Sues Madoff's Brother, Sons, Niece

We don't have a wall of shame at Fordham, but if we did two of the first on it might be Peter Madoff and Shana Madoff, if the allegations of Irving Picard, liquidator of Bernard Madoff 's enterprise, prove to be true. As a law school that prides itself on training lawyers in the service of others it is painful to read that two alumni are among
"the Family Defendants’ (whose) management responsibilities extended through trading operations, customer relationships, and legal and regulatory compliance. Yet the Family Members were completely derelict in these duties and responsibilities. As a result, they either failed to detect or failed to stop the fraud, thereby enabling and facilitating the Ponzi scheme at BLMIS. Simply put, if the Family Members had been doing their jobs—honestly and faithfully—the Madoff Ponzi scheme might never have succeeded, or continued for so long."

The Securities Investor Protection Corporation (SIPC) appointed Picard trustee to liquidate the fallen house of cards and to recover any assets. That mandated a thorough search for third parties from whom recovery might be made for the defrauded investors.

According to the SIPC Complaint, filed October 2, 2009, Peter - Bernard's brother - and his daughter Shana are graduates of Fordham Law School. Both were highly placed investment professionals who held key positions in Bernard L Madoff Investment Securities, LLC. (BLMIS)

According to the SIPC complaint the Madoffs used the company as a
"personal piggy bank. Each of the Family Defendants took huge sums of money out of BLMIS to fund personal business ventures and personal expenses such as homes, cars, and boats. The Family Defendants’ misappropriations of BLMIS customer funds ranged from the extraordinary (the use of BLMIS customer funds to pay for multi-million dollar vacation homes) to the routine (the use of BLMIS customer funds to pay their monthly credit card charges for restaurants, vacations, and clothing). The means of diverting those customer funds ranged from the simple (merely transferring money to the Family Defendants’ own personal bank accounts) to the complex (fabricating the purchases of securities on the Family Defendants’ personal BLMIS investment advisory account statements and then cashing out of those positions)."

Comment [5] of the preamble of the American Bar Association's Model Rules of Professional Conduct - the template for nearly every state's ethics rules - declares "A lawyer's conduct should conform to the requirements of the law, both in professional service to clients and in the lawyer's business and personal affairs. ". Peter, the former number 2, and compliance officer, like his daughter who succeeded him as compliance officer, faces not only the trustee's effort to strip him of his wealth but also disbarment in New York.

Shana Madoff , the SIPC alleges
"held herself out as Compliance Counsel, in-house Counsel, and Compliance Director of BLMIS. Shana was an experienced investment professional who, along with her father, Peter Madoff, and her uncle, Bernard Madoff, was responsible for overseeing all compliance-related activities at the Company. Shana was a member of the SIFMA Compliance and Legal Division Executive Committee, the FINRA Consultative Committee, STANY, the NASD’s Market Regulation Committee, the SIFMA Self-Regulatory and SRO Committee, and the SIFMA Continuing Education Committee."
There is a lot to be said about the role of the two lawyers, but Shana held herself out as "in house counsel" for the company. She assumed duties to the company to protect the assets of the company which the SIPC alleges paid family members inordinate compensation without business justification.

What is the standard of care that she owed as a fiduciary? One factor is that the lawyer's duty of confidentiality did not bar disclosure of such waste of assets as the SIPC describes. A lawyer is released from the duty of confidentiality and may reveal defalcations of a client, according to ABA Model Rule 1.6 (b):

"(2) to prevent the client from committing a crime or fraud that is reasonably certain to result in substantial injury to the financial interests or property of another and in furtherance of which the client has used or is using the lawyer's services;
(3) to prevent, mitigate or rectify substantial injury to the financial interests or property of another that is reasonably certain to result or has resulted from the client's commission of a crime or fraud in furtherance of which the client has used the lawyer's services".

Shana Madoff is vulnerable not only for her own alleged looting of the company but also for her failure to act to prevent perpetuation of the massive fraud. She breached a duty to the investors when she certified compliance that could not possibly be a fact to which she could aver as a lawyer who had conducted competent investigation - since the Trustee's interim report shows that BLMIS conducted no trades for over 20 years.

The Madoff family may be stripped of its entire wealth, which the Trustee alleges to be $198 million.

Because she was chief compliance officer every fraud that took place on her watch is something to which Shana Madoff's defalcations may have substantially contributed. She reassured investors that all was well when in fact all was sham.