Tuesday, September 30, 2014

Legally Speaking: Awards we’d like to see

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Readers of “Legally Speaking” know that I delight in finding some of the most bizarre, did-that-really-happen moments in actual court cases in the civil and criminal justice systems.

Some of the more recent instances, however, stand out so much that they ought to have their own distinctions. Here are some awards I’d give out if I were in charge.


The “Dog Ate My Homework” Award

If you’ve ever seen one of those spy movies where someone swallows the microfilm or data chip to keep it from falling into the wrong hands, then you’ll appreciate the strange diet of Frank Tamayo.

The 41-year-old former mortgage broker recently pleaded guilty to securities fraud in a New York City insider trading case. According to prosecutors, Tamayo and a former law school classmate working at a Wall Street firm engaged in a five-year insider trading scheme that allegedly produced $5.6 million in profits off of $33 million in stock trades.

Tamayo allegedly jotted down ticker symbols on Post-it notes or napkins, showed them to his stockbroker, and then ate the notes to destroy the evidence. With a diet like that, at least he won’t complain about prison food.

The “Fashion Victim” Award

Twenty-two-year-old Jeremiah Jakson of Philadelphia was taken aback recently when he showed up for a preliminary hearing in the case of the strangulation murder of 23-year-old Laura Araujo (Jakson is accused of murdering Araujo last July).

Jakson appeared for the hearing wearing a T-shirt emblazoned with the saying “Crime Pays.”

Judge Teresa Carr Demi was not amused, commenting “That’s a very interesting choice of shirt” (Jakson claims he had been given the shirt while in prison, and that he hadn’t thought to turn it inside out).

Perhaps after trial, someone can give Jakson a new shirt that reads “No, Crime Doesn’t Pay.”

The “We Saw This Coming” Award

Thirty-four-year-old Kelly John Lange of Sioux Falls, S.D., caused quite a commotion in court on Sept. 2, inexplicably tipping over the counsel’s table and attacking his public defender.

The defense attorney sustained a cut and swollen lip, but was otherwise okay, although her client now faces additional charges of simple assault.

What, you may ask, was Lange originally in court for? He had failed to complete court-ordered anger management classes in connection with a prior arrest.

The “What Am I Thinking Now?” Award

With the uncertain job prospects facing many recent law school graduates, it’s never a bad idea to have a back-up plan. Maybe that’s what Florida lawyer Mark Anthony was thinking after graduating from Mercer University’s Walter F. George Law School.

Anthony holds himself out as the “psychic lawyer,” charging $250 an hour for a telephone reading. Anthony says there’s a six-month waiting list for such readings, which usually begin with a prayer to raise “the vibrational frequency that lets spirits know I’m trying to reach them and attracts them to me.”

Wouldn’t it be great to have a lawyer who will not only handle your case, but use his “psychic powers” to tell you how it will turn out?

The Pop Culture Award

This one goes out to Justice Debra Lehrmann of the Supreme Court of Texas, who has not only authored some well-written and important decisions recently on free speech and online defamation, but also outed herself as a fan of the cult favorite film “The Big Lebowski.”

In delivering the Court’s opinion in late August in the case of Kinney v. Barnes (involving alleged online defamation and freedom of speech), Justice Lehrmann noted the bedrock First Amendment principle that prior restraints on speech are strongly disfavored.

Justice Lehrmann observed that First Amendment protection against prior restraint has been reaffirmed time and time again by the U.S. Supreme Court, Texas appellate courts, “and even popular culture”—as she quoted from the 1998 film “The Big Lebowski,” starring Jeff Bridges as a slacker known as The Dude.

As a fan of the movie myself, I say brava, Justice Lehrmann, and I toast you with a symbolic White Russian. May you bowl a perfect game and find yourself a rug that “really ties the room together.”

The Dude abides.

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Discipline and Rigor in Your Internal Controls

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Discipline In a recent New York Times (NYT) Op-Ed by David Brooks, entitled “The Good Order ”, he discussed how routine can lead to creativity. He cited to the example of three well-known authors whose habits included the following. “Maya Angelou would get up every morning at 5:30 and have coffee at 6. At 6:30, she would go off to a hotel room she kept — a small modest room with nothing but a bed, desk, Bible, dictionary, deck of cards and bottle of sherry. She would arrive at the room at 7 a.m. and write until 12:30 p.m. or 2 o’clock.” Another example was John Cheever, who “would get up, put on his only suit, ride the elevator in his apartment building down to a storage room in the basement. Then he’d take off his suit and sit in his boxers and write until noon. Then he’d put the suit back on and ride upstairs to lunch.” Finally, there was the example of Anthony Trollope, who “would arrive at his writing table at 5:30 each morning. His servant would bring him the same cup of coffee at the same time. He would write 250 words every 15 minutes for two and a half hours every day. If he finished a novel without writing his daily 2,500 words, he would immediately start a new novel to complete his word allotment.” Brooks thesis for his piece seemed to be summed up by a quote from Henry Miller (of all people), “I know that to sustain these true moments of insight, one has to be highly disciplined, lead a disciplined life.” Sort of gives a whole new meaning to the word ‘discipline’.

However moving back to somewhat salacious concepts, I thought about those words in the context of internal controls around a Foreign Corrupt Practices Act (FCPA) compliance program. Brooks’ thoughts on building and maintaining order inform today’s post. In the area of internal controls, I believe it is incumbent to consider not only the most obvious risk areas for your internal controls but also the universe of potential transactions within the operations of a particular company. Once again relying on my friend and internal controls expert Henry Mixon I queried him about some of the other types of internal controls a company should consider around gifts, travel, business courtesies and entertainment.

One area that companies need to be mindful of is corporate checks and wire transfers, in response to falsified supporting documentation, such as check requests, purchase orders, or vendor invoices. Here Mixon believes that the Delegation of Authority (DOA) is a critical internal control. So, for example a wire transfer of $X between company bank accounts in the US might require approval by the Finance Manager at the initiating location and one officer. However, a wire transfer of $X to the company’s bank account in Nigeria, could require approval by the Finance Manager, a knowledgeable person in the Compliance function, and one officer. The key is that the DOA should specify who must give the final approval for such an expense.

I asked Mixon about the situation where checks drawn on local bank accounts in locations outside the US “off books” bank accounts, commonly known as slush funds. Petty cash disbursements in locations outside the US – the unique control issues regarding locations outside the US will be discussed in a future podcast. Some petty cash funds outside the US have small balances but substantial throughput of transactions. In this instance, Mixon said that the DOA should address replenishment of petty cash funds in countries outside the US, as well as approval of expense reports for employees who work outside the US, including those who travel from the US to work outside US.

Another area for concern is travel, the reason for this being that a company’s corporate travel department and independent travel agencies can buy tickets, hotel rooms, etc., for non-employees. Mixon noted that internal controls might be needed to ensure policies are enforced when travel for non-employees can be purchased through a corporate travel department or through independent travel agencies. As was demonstrated with GlaxoSmithKline PLC (GSK) in China, a company must not discount the risk related to abuse of power internally and collusion with independent travel agencies. Mixon advises that you should implement procedures to ensure compliance with your company policies regarding payment of travel and related expenses for third parties, for not only visits to manufacturing or job sites but also any compliance restrictions that might be in place.

An area for fraud, corruption and corporate abuse has long been Procurement cards or “P Cards”. Mixon cautions that if your company uses procurement cards, assume this to be a very high-risk area, not just for FCPA but also for fraud risk generally. Banks have made a great selling job to corporations for the use of P-Cards to help to facilitate “cash management” but, more often than not, they can simply be a streamlined way to allow embezzlement and misbehavior to go undetected. Here a control objective should be put in place along the lines of a written policy and procedures defining the acceptable and unacceptable use of company Procurement Cards, required forms, required approvals, documentation and review requirements.

An interesting analogy that Mixon used is that misbehavior, like water, seeks its own level. Mixon explained that this meant if the pre-approval process and strong controls over expense reports prevent misbehavior, employees who wish to misbehave will seek other ways to do it where controls are not so strong. This means you should use your risk assessment process to help prioritize where controls are most needed. If your company prohibits gifts and any travel other than for the submitting employee from being included in the expense report, you should consider requiring instead a check request form be used, which, Mixon noted, would be subject to stringent controls. He added that in such cases a checklist should be completed and attached to the check request which includes questions and disclosures designed to flush out exactly what was provided in the way of a business class airline, pocket money, event tickets, side trips, leisure activities, spouses or other relatives who might be traveling and why the travel had business purpose. Such an internal control would allow for a more streamlined processing of expense reports and still elevates the gifts/travel items to the appropriate level of review and requires appropriate documentation.

I inquired as to why a Compliance Officer relies on the audit controls that are in place regarding gifts because in many companies, internal audits of expense reports are common. Mixon noted that it is important to keep in mind that, with respect to gifts, internal audits most often constitute, at best, a detect control, which only gives comfort for some historical period and is not necessarily representative of the controls in place to prevent future violations. So, it will be a false sense of security if a Compliance Officer relies on the internal audit of expense reports to be the control needed over violation of Gift policies.

I thought about one line in Brooks’ piece, which seemed to echo Mixon’s thoughts on internal controls, where Brooks wrote, “Building and maintaining order…requires toughness of mind and rigid discipline to properly serve your own work.” By having the rigor to institute and enforce the types of internal controls Mixon has identified, you can go a long way towards detecting and more importantly preventing a FCPA violation from occurring.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2014

Filed under: Best Practices, Compliance, Compliance and Ethics, compliance programs, David Brooks, FCPA, Henry Mixon, Internal Controls, New York Times, Uncategorized Tagged: best practices, compliance, compliance programs, ethics and compliance, FCPA, New York Times, NYT

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U.S. Requires Assistance to Enforce FATCA

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As I have previously discussed, the U.S. government has shown a strong commitment to investigating violations and enforcing compliance with the Foreign Account Tax Compliance Act (FATCA). The global anti tax-evasion law that requires foreign financial institutions to reveal account…

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Limitations on Discovery: Going Behind the Face of an Appraisal Award

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Disputed insurance claims are often resolved in the appraisal process. The process is generally less time consuming and less expensive than full blown litigation and, if done properly, can resolve the majority of discrepancies between the policyholder’s estimate and the position of the insurance carrier.

While the basic law on appraisal is fairly well developed in most states, a growing trend of litigation after the appraisal process has forced courts to consider what role, if any, the appraisal panel should play in that circumstance.

Florida courts have found that litigation over an appraisal award must be based on the face of the award itself and have prohibited parties from going further to have an award overturned. In First Protective Insurance Company v. Hess,1 the insurance carrier attempted to have an appraisal award overturned by arguing that the appraisal panel had awarded more money for stolen jewelry than the $1,000 limit in the insurance policy allowed. The award…


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Officials Scrutinize Andrew Madoff’s $16 Million Estate

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Until he passed away earlier this month, Bernard Madoff’s last surviving son was under investigation for possible involvement in his father’s multibillion-dollar Ponzi scheme. Despite his passing, scrutiny over his $16 million estate continues. The court appointed trustee seeking to…

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O’Brien preparing for his first taste of Houston-Dallas rivalry

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Until he arrived in Houston in January, Bill O’Brien had never coached anywhere close to Texas, but it didn’t take him long to understand what it means to Houston when the Texans play the Dallas Cowboys.

The Cowboys host the Texans on Sunday. It’s their first regular-season appearance at AT&T Stadium. The Cowboys have a 2-1 advantage in the non-conference series, including victories in the last two games.

The Texans and Cowboys are both 3-1 and in first place in their divisions.

The Texans beat the Cowboys in 2002, the first game in franchise history, at NRG Stadium.

“I know this game means a lot,” O’Brien said today. “I know it means a lot to Mr. (Bob) McNair, the organization and the city of Houston. I know it means a lot to our fans.

“Dallas is an excellent team that’s hot right now. It’s a huge challenge for our team.”

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Monday, September 29, 2014

First Shoe Drops for Corporate Inversions

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Notice 2014-52, released by the US Treasury Department on September 22, 2014, is intended to disrupt, and in some cases prevent, so-called corporate inversion transactions that have not been completed prior to the notice’s release.

Although the notice includes very detailed rules, it very generally takes a two-pronged approach to discourage inversions after September 21, 2014.

Dentons’ Tax team explores the implications of Notice 2014-52 on cross-border acquisitions or mergers.

Read more

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Simple Jury Persuasion: Should you consider 3-D for your courtroom videos?

Originally published by .

3D-image-water-park Evidence admissibility issues aside, the answer is, “only if you can do it as well as they did in the 3D movie Polar Express”. As it turns out, 3D isn’t that much more impactful than 2D unless it’s done really, really well.

Psychologists and neuroscientists studying emotion often use film clips for their research. So when these researchers from the University of Utah thought about the influx of 3D films, they wondered if those films would have more emotional impact than the older 2D films–especially for younger viewers (whom we might consider potential jurors). Theoretically, 3D movies heighten the emotional experience (since you really don’t know what to expect or when the character will suddenly reach out from the screen and take a swipe at you). These researchers looked at a few movies that came in both 2D and 3D versions (My Bloody Valentine, Despicable Me, Tangled, and The Polar Express).

Rather than asking their 408 undergraduate participants (between 18 and 64 years of age; 62.75% female; 80% Caucasian, 9.8% Asian, 7% Hispanic, 1.23% Black or African-American, 1.23% Native Hawaiian or Pacific Islander, and .98% as American Indian or Alaska Native) for their emotional reactions to the 2D and 3D movies, they hooked them up with electrodes and measured heart rate, skin conductance (how much they were sweating), and other physiological responses to film scenes during the duration of the five-minute clips they were shown.

What they found, in brief, was that whether a film was 2D or 3D didn’t really matter in terms of the participants reactions. While they reacted emotionally, there were no real differences in how they reacted to the 2D versions of the films versus the 3D versions–with the exception of small differences in “electrodermal responses” between the 2D and 3D versions of The Polar Express. (They reacted more strongly to the 3D version.)

The researchers underscore the fact that the clip was far and away the best example of the 3D technology in the study, and the differences measured were small. But, they say, overall, there were no real differences between the emotional impact of 2D and 3D films.

This is good news for litigation advocacy as the cost of creating a 3D film and animation is high compared to 2D, and the road would likely be fraught with legal wrangling before any 3D film (sanitized of undue influence) made it to the jurors. (You may be interested in reading a Canadian author’s perspective on forensic 3D animation in The Jury Expert .)

Bride DL, Crowell SE, Baucom BR, Kaufman EA, O’Connor CG, Skidmore CR, & Yaptangco M (2014). Testing the Effectiveness of 3D Film for Laboratory-Based Studies of Emotion. PLoS ONE, 9 (8) PMID: 25170878



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TNG Premiers and Internal Controls for Gifts in a Best Practices Compliance Program

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Star Trek TNG This week, 27 years ago, Star Trek – The Next Generation (TNG) made its television debut. Rarely has there a follow up to a beloved original series (Star Trek – The Original Series (TOS)) that is equally treasured by fans. They say that your favorite Star Trek is the one you grew up with, so for me that is TOS and that will always be my most beloved Star Trek series, but for the younger generations TNG fills that bill. The series occurred some 70 years in the time after TOS so things were a bit different. One of the differences was on following the Prime Directive more rigorously. While Captain Kirk, who actually had a hand in drafting the Prime Directive, seemed to view it with situational ethics, Captain Picard was much more concerned about not violating it.

I thought about this evolution of the Prime Directive from TOS to TNG when considering what types of internal controls a compliance practitioner might consider in the area of gifts in a Foreign Corrupt Practices Act (FCPA) best practices compliance program. I have been continuing my exploration of internal controls with well-known expert Henry Mixon, Principal of Mixon-Consulting. Mixon believes that it would be reasonable to expect that internal controls over gifts would be designed to ensure that all gifts satisfy the criteria as defined and interpreted in Company policies. Generally speaking, these are fairly narrow, including a definition of the dollar limit, which must not be exceeded in order for gifts to be permissible, coupled with some subjective criteria such as the legality of the gifts for the recipient and whether the practice is customary within the country where the gift is delivered. The question I focus on is how to enforce the policies so that employees are not free to disregard them at will?

The Department of Justice (DOJ), in several enforcement actions and the FCPA Guidance has emphasized the importance of risk assessment and effective controls and building a program tailored to those risks. Many companies effectively minimize the risk of inappropriate gifts through stringent pre-approval requirements because a sufficiently robust and enforced pre-approval policy can reduce the number of gifts simply because of the headache of getting the pre-approval. This has the added benefit of ensuring enforcement of internal controls, largely because of the reduced volume of gifts being included in expense reports. Mixon cautions that in considering the effectiveness of controls, you must always keep in mind the most frequently used method for defeating an internal control, which is driven by a dollar amount criteria, is splitting the item into multiple parts in order to appear to stay under the limit and to avoid the defined approval authority based on the amount of the gift.

Mixon believes that the key analysis is whether there are controls in place to enforce the policies and whether those controls are documented. To help to answer this query, he posited that there are four issues to evaluate.

  • Is the correct level of person approving the payment / reimbursement for the gift?

  • Are there specific controls, including signoffs, to demonstrate that the gift had a proper business purpose?

  • Are the controls regarding gifts sufficiently preventative, rather than relying on detect controls?

  • If controls are not followed, is that failure detected by other internal controls or the compliance protocols?

While many compliance practitioners believe that employee expense reports are a sufficient internal control regarding gifts, because there are other ways in which a gift can be presented, there need to be other controls. Mixon believes that once your company policy on gifts has been finalized, the internal controls over expense reports fall into three basic areas: (1) The expense report format, including what information it requires; (2) Controls over the submitting employee and the preparation of the expense report; and (3) Controls to ensure the approvers do their review process properly.

Mixon believes the format itself of an expense report can go a long way toward prevention of violations of company policy. First it is important to have preprinted representations and certifications within the form because these can lead to “stop and think” type of controls, meaning the person submitting the expense report has to at least consider the information being submitted. The form can be signed without reading the preprinted representations, but if the employee and reviewers have been trained on how to review the expense report, it can be difficult to say later that the submitting employee did not understand what they were signing.

Mixon suggested two forms of representation, the Preparer’s representations and the Approver’s representations. The Preparer’s representations include ensuring that all items representing a proper business purpose comply with the company’s code of conduct, comply with local law and custom, and comply with all applicable company policies regarding FCPA compliance. The Approver’s representations ensure that all supporting documentation has been examined and that all documentation complies with applicable company policies, including the submission of original receipts. Further, the approver should certify that they have complied with all company policies regarding the review and approval of the expense report.

Mixon noted that some companies have two basic forms of expense reports. One is for situations in which all items pertain to US locations and do not involve any expenses incurred outside the US or for benefit of persons outside the US. The second is for items involving locations or persons outside the US. The international reporting form might have more stringent requirements and should provide for more detailed disclosures. It could require reporting, in a separate section of the expense report, all items that involve government officials, so that these items are not “buried” elsewhere in the expense report. Just as an added measure, the expense report includes a column where other expenses are reported which requires the submitter to check “Government Official YN?” this type of format should require sufficient disclosure of information regarding each item involving government officials. The next step in such an enhanced protocol would require a senior officer from the business unit to approve any reimbursements that meet certain criteria, for example, certain geographical areas or countries. Finally, such an enhanced representation could also include separate sections for each item requiring a description of the business purpose of meals, entertainment, names and business affiliation of all attendees, description of gifts and their business purpose, etc. A typical expense report requires this information to be on the receipt. Mixon believes that moving beyond simply requiring receipts and requiring such detail to be incorporated directly onto the expense reimbursement forms highlights the presence or absence of proper documentation much more readily. Mixon ended by noting it was incumbent to ensure reviewers sign off that each such item has documentation that required pre-approvals were obtained, if necessary.

While following the Prime Directive does not always lead to the result that the crew of TNG Enterprise desired; it did have the greater effect of allowing cultures and peoples to develop without interference. Internal controls around gifts can be used in a variety of ways in your best practices compliance program. They can certainly be used to detect an issue and perhaps even prevent an issue from becoming a full-blown FCPA violation, however, by using some of the techniques that Mixon has suggested you can move your compliance program to a proscriptive phase where you not only stop an issue from becoming a violation but through identification, you can move towards remediation as a part of your ongoing compliance efforts. Just as Star Trek’s Prime Directive had an ultimate purpose, if you can move your compliance program’s internal controls forward, you can help make them a part of your financial controls and thereby have a better run company.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2014

Filed under: Best Practices, Compliance, Compliance and Ethics, compliance programs, FCPA, Gifts and Business Entertainment, Henry Mixon, Internal Controls Tagged: best practices, compliance, compliance programs, FCPA, Foreign Corrupt Practices Act, Henry Mixon, Internal Controls

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Friday, September 26, 2014

Top 10 From Texas Bar Today: Partridges, Trees, and Stingrays

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To highlight some of the posts that stand out from the crowd, the editors of Texas Bar Today have created a list from the week’s blog posts of the top ten based on subject matter, writing style, headline, and imagery. We hope you enjoy this installment.

10. Social Media: “I Don’t Think Hank Done It That Way”

9. How far backwards should an appeals court bend to construe garbled briefing?

8. 18+ States Rely on “Stingrays” (Fake Cell Towers) for Surveillance – Is this an Evasion of Privacy?

7. Billy the Kid Begins and the GSK China Verdict

6. Abnormal Interviews: Actress Roma Maffia from Disclosure and Double Jeopardy

5. Selling Legal Services: Both an Art and a Science

4. Come On Get Happy – The Partridge Family and GSK’s Internal Investigation

3. 2 Courts Permit Defendants to be Served on Facebook

2. It’s 2014: Where Are All The Female Subjects In Surgical Research?

1. How Much Are Your Trees Worth?

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What’s Love Got to Do with Lawyers? Thoughts on Relationality, Love, and Lawyers’ Work"

Originally published by .

Article. Abstract: In a new and provocative book, Rob Vischer has challenged the neutral partisan conception of the lawyer and the legal profession’s reductive presumption that all clients wish to pursue atomistic self-interest irrespective of the consequences to others. Vischer’s…

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The Scope of Appraisal

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Earlier this month, a federal judge sitting in the Southern District of Indiana examined the scope of the appraisal clause in the property insurance policy. Relying on many of the same cases I have discussed in earlier blogs in this series, the court found that the appraisal panel must consider causation as part of the appraisal process:

The insurance policy at issue here contains an appraisal clause that makes no mention of any exception if there is disagreement on the ‘value of the property or the amount of ‘loss.’’ Both parties concede that there is some amount of loss covered by the policy, but [the carrier] insists that the majority of the roof damage to the apartment complex is attributable to faulty construction or maintenance, rather than storm damage. We agree with [the insured] that it would be extraordinarily difficult, if not impossible, for an appraiser to determine the amount of storm damage without addressing the demarcation between ‘storm…


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Say What?! – Ask A Stupid Question …

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Hal Monk of Bedford, who confesses that he has enjoyed the et cetera column for so many years that he “feels plum guilty for not having sent … any contributions in the past,” sent in this excerpt from the January 1993 deposition of Hollywood celebrity Zsa Zsa Gabor, Monk’s client. Larry Macon, with Akin Gump’s San Antonio office, took the deposition.

Mr. Macon: What is your date of birth?

The Witness: I don’t know.

Q. You misunderstood my question. When were you born?

A. I understood your question perfectly well. My answer is I don’t know; don’t remember.

Q. I demand an explanation of that absurd response.

A. Before we come up here, my lawyer told me how to make a good —

Mr. Monk: Just a minute, hold on —

The Witness: witness or how to do good in three —

Mr. Monk: Ms. Gabor, you don’t need to —

The Witness: Monk said I must follow three easy steps. First, to listen to the question and be sure I know what you mean. Then, answer the question just if I know for sure. But OK to say I don’t remember or I don’t know if that is truth. Do you remember being born? Of course not. It’s a stupid damn question. Now, ask me something maybe I know for sure.

• • •

Monk’s Epilogue: Although the deposition continued for several hours, Mr. Macon never ascertained the witness’ birth date. But then, neither did her attorney.

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Thursday, September 25, 2014

TMCP panel educates attorneys on increasingly popular public-private partnerships

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Public-private partnerships are being promoted by President Obama, written about by Forbes and the New York Times, and heralded by some as “a lifeline for cities” inundated with fiscal problems and as the way to build our nation’s future (they also attract their fair share of criticism). In P3s, as they’re commonly called, government agencies team with private companies to complete a project, whether it be infrastructure-related, like a highway, or service-based, like an electric utility or parking meter system.

Texas attorneys are paying attention to these increasingly common—and sometimes complex—arrangements, as seen with the recent CLE course “Hot Topics in Public-Private Partnerships,” which was offered at the State Bar of Texas Minority Counsel Program in Austin, Texas, from September 3-5, 2014. Leading the panel was Mary Colchin Johndroe, a partner with Cantey Hanger in Fort Worth, and Mario Menendez, vice president and general counsel to construction company Ferrovial Agroman in the Woodlands. Allen Estes III, of Gordon & Rees, moderated.

Taking an in-depth look at P3s, Johndroe, Menendez, and Estes covered a range of issues, including the trend toward more P3s (approximately $61 billion has gone toward P3 projects in the past 25 years—half of which was spent in just the past five years—and Texas has more P3s than any other state); the legislative history of P3s (33 states have laws authorizing P3s, up from 23 in 2006, and six are considering similar legislation); the differences among P3s and other partnership models; and more. Menendez further explained that projects between the public and private sectors are typically supported financially by the users—such as drivers on toll roads—not by all taxpayers, and that the project owners (typically the private companies) commonly assume 100 percent of the risk.

The panelists discussed additional legal matters concerning P3s, such as relevant Texas codes and regulations, the process of contracting with TxDOT on a P3 agreement, powers of eminent domain, submitting compliant designs, sales and use tax, bonding requirements, and liability limitations.

Cantey Hanger has made a PDF of the “Hot Topics in Public-Private Partnerships” presentation available here: http://ift.tt/YeLfwh.

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Juries are Unpredictable

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I try to warn clients all the time that juries are fickle. A party can have the best evidence and still lose. One recent case illustrates that reality. In Alexander v. Servisair, LLC, No. H-12-817 (S.D. Tex. 2013), the plaintiff alleged that she had been terminated for pursuing her rights to sick leave under the Family Medical Leave Act. Darlene Alexander was out on extended FMLA leave when the employer fired her. The employer claimed she had failed to return to work and had abandoned her job. Yet, she had submitted the proper FMLA paper work and had been approved for leave. The case ought to be “open and shut.” The employer fired her for a clearly false reason while she was still out on FMLA leave.

After a two day trial, the jury found that the employer did indeed interfere with the employee’s attempt to take leave. It found the employer did not act in good faith in dealing with the employee’s request for sick leave. Yet, the jury awarded a mere $1 in damages.

The employee presented undisputed evidence that she had lost $37,000 in income due to the employer’s termination. The jury found the employer did not act in good faith in terminating Ms. Alexander. So, it should have awarded liquidated damages equal to the amount of the lost pay. So, the jury should have awarded $37,000 twice, once for lost pay and once for liquidated damages. And, the employer presented no evidence suggesting the plaintiff did not mitigate her damages. Yet, the jury only awarded $1 in damages. It is a crazy verdict that makes little sense.

Responding to a motion by the plaintiff, the judge later awarded $37,000 in lost pay and another $37,000 in liquidated damages. The judge also awarded some $92,000 in attorney’s fees. The judge, in effect, rectified the jury’s error. But, the employer has appealed.

We like to think that juries consider carefully each case that comes before it. But, in reality, many jury members do not wish to be in court. They have many other obligations. Perhaps, some jurors traded a vote of “Yes” on a couple of questions, so they could all go home more quickly. That is so unfortunate. Jury duty is one of our hallmarks as citizens of a great Republic. We need to give jury duty the respect it deserves.

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Wetland Jurisdictional Determinations Still Not Appealable

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by Lowell Rothschild

When the U.S. Supreme Court decided in Sackett v. EPA that Environmental Protection Agency (EPA) wetland compliance orders were appealable, one question was how far would other courts extend the Supreme Court’s reasoning? Two years later, the answer is becoming clear on at least one front: courts continue to hold that wetland jurisdictional determinations are [...]

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Say What?! – The Payment Plan

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From Thomas G. Sharpe, Jr. of San Antonio (Whetley & Sharpe), this excerpt from his deposition of a defendant regarding the collection of a judgment for Tom’s client:

Q. First of all, what I’m asking, sir, is what are you going to do to pay this judgment?

A. Well, you said you had a payment plan and I said I would pay you half when I die and the other half when I come back or, if you have another plan – do you have a plan where I can pay nothing down or nothing a month?

Q. Neither one of those would be satisfactory to settle the judgment.

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Equitable Defense of Laches Rejected After Postverdict Hearing

Originally published by .

Tyler_courthouse_1_2 U.S. Ethernet Innovations, LLC v. Texas Instruments , 6:11cv491 (9/18/14)

Judge: Michael Schneider

Holding: Equitable Defense of Laches Rejected

Following the trial in this case, the court conducted a separate evidentiary hearing on laches, at which it heard the live testimony of five witnesses, and accepted deposition designations, prior trial testimony, and exhibits for consideration as well.

After reviewing the underlying facts, Judge Schneider began by concluding that TI had not fully disclosed its position on laches during the discovery. Nonetheless, he determined that even if the court considered the undisclosed evidence, it would reject the defense anyway because TI could not prove material prejudice, and the doctrine of unclean hands prevented it from benefiting from an inequitable remedy.

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Wednesday, September 24, 2014

How far backwards should an appeals court bend to construe garbled briefing?

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Coleman v. Prospere

Dallas Court of Appeals, No. 05-13-0068-CV (September 22, 2014)

Justices FitzGerald, Fillmore, and Evans (Opinion)

A divided panel of the Dallas Court of Appeals reversed a summary judgment that dismissed a client’s lawsuit against his criminal lawyer. The Court of Appeals held that “[a] no-evidence motion for summary judgment must challenge specifically identified elements of a cause of action or defense on which the non-movant bears the burden of proof at trial,” and that the appellee’s motion had failed to do so. But it was the gross lack of clarity in the appellant’s briefing, and the lengths to which the Court went to decipher it, that became the focal point of disagreement between the majority and dissent.

Coleman alleged that Prospere agreed to represent him in a criminal matter for a flat fee of $25,000. The parties agreed, Coleman said, that Prospere would pursue a specific defense. After receiving the fee, Prospere urged Coleman to accept a plea agreement instead of pursuing the agreed-upon defense. Coleman refused and demanded reimbursement of the $25,000 fee. When Prospere declined, Coleman filed suit, asserting claims for breach of contract, deceptive trade practices, and intentional infliction of emotional distress. Prospere denied the substance of the claims and also moved for a traditional and no-evidence summary judgment. The trial court granted Prospere’s motion for summary judgment, without specifying the grounds or theory on which it based that decision.

The Court of Appeals reversed. Drawing upon its prior en banc opinion in Jose Fuentes Co. v. Alfaro, the Court said, “A no-evidence motion that only generally challenges the sufficiency of the non-movant’s case and fails to state the specific elements that the movant contends lack supporting evidence is fundamentally defective and cannot support summary judgment as a matter of law.” Because it found Prospere’s motion had failed to “challenge or even mention a single element” of the three causes of action that lacked evidence, the Court found the no-evidence grounds in the summary judgment motion legally insufficient. And the Court went on to hold summary judgment to have been improper based on traditional grounds, as well.

Getting to that point, however, required the appeals court to afford appellant’s brief substantial latitude. The majority observed that, “Rambling in argument and jumbling citations, case summaries, and discussion in a chaotic way,” appellant’s brief was “far from a model of clarity,” such that it was “quite difficult to ascertain the complaints presented.” Nevertheless, because it felt duty bound to “construe the Rules of Appellate Procedure reasonably, yet liberally, so that the right to appeal is not lost,” the majority labored to discern the complaints the appellant apparently was trying to assert, and ultimately ruled in his favor.

Justice FitzGerald dissented, saying the majority’s “description [of appellant’s brief] does not do full justice to the incoherence of appellant’s argument,” and characterizing portions of the brief as “barely comprehensible.” While finding that appellee’s no-evidence motion for summary judgment did adequately specify an element on which proof was lacking, Justice FitzGerald would have affirmed even before getting to that issue. “[Coleman’s] brief is so deficient under the rules of appellate procedure,” he said, “that we should affirm the judgment without discussion of the merits.” Therefore, the dissent concluded, the majority’s indulgent approach to this appellant’s briefing sets “bad precedent,” and the take-nothing judgment should be affirmed irrespective of the merits.

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Say What?! – Do You Swear to Tell the Truth…

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Judge: (To young witness) Do you know what would happen to you if you told a lie?

Witness: Yes, I would go to hell.

Judge: Is that all?

Witness: Isn’t that enough?

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Decreasing the paper shuffle in Montgomery County

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Although many of Texas’s 254 counties have technologically savvy infrastructures, others have not yet implemented modern, digital operations. Some of these communities are small or remote and less “plugged-in,” while others are more populated but satisfied with or accustomed to their current system. But the permanence of the digital age and the Texas Supreme Court’s e-filing mandate are encouraging many counties to start the switch. The next e-filing deadline—for courts in counties with a population of 100,000 to 199,999—is Jan. 1, 2015.

Montgomery County is one such local government in transition. Encompassing the city of Conroe, about 45 miles north of Houston, and a majority of the Woodlands, Montgomery County has a population of approximately 485,000. In 2012, the county started its still-ongoing move away from paper, “homegrown” computer systems, and outdated software. Like many Texas counties, Montgomery had already been scanning and digitally storing all incoming documents, but until recently it had no way to electronically “move” those files to one location accessible by all departments.

“For the courts, the clerks, and the attorneys, we were using 20-year-old software that was non-Windows based, non-work flow oriented—not really designed to take advantage of efficiencies and productivities that you can attain with current methods,” said Marshall Shirley, IT director for Montgomery County. “We knew we needed to do a refresh on these systems.”

It has been an incremental process, starting with new laptop computers for sheriff patrol cars and followed by new software for courts, clerks, and prosecutors in 2013 and 2014. This summer, the sheriff’s office headquarters and patrol deputies started working toward acquiring new software, which will enable deputies to file crime reports from their cars and communicate with each other as well as constables and municipal police. By 2015, the county aims to have new software for the jail system and to complete the digitizing, mapping, and migrating of district and county criminal data—even though the Supreme Court has not yet mandated e-filing for criminal cases. (Montgomery County met its July 2014 e-filing deadline for civil cases several months early.)

Most departments within the county, including the courts, are now using Tyler Technology’s Odyssey Case Manager, while the district and county attorneys will soon be using the Odyssey Attorney Manager for Prosecutors and Public Defenders. The law enforcement offices, on the other hand, will use Spillman’s Computer-Aided Dispatch, Mobile Records, and Jail Management products. Montgomery County’s IT department will then integrate the Tyler and Spillman systems to enable cross department flow of data, ideally in real time.

Funded through the county’s budget of about $1.57 million each year, the new systems—which include all software, data migration, training, and professional services—have cost just under $6.5 million. But county employees say these efforts are increasing efficiencies and saving time—and will also save money in the long run.

According to Patrice McDonald, judge of Montgomery County Court at Law No. 3, before the transition, she and others in the court system dealt with paper “all the time”—like the paper case files that she would box up at the end of the day for evening homework and those paper dockets that waited for her in the morning. “I’m a family judge, and we have a very paper intensive caseload,” said McDonald. “We would have clerks and coordinators toting files back and forth all day long in, essentially, grocery carts.”

With the recent transition, McDonald’s judicial life has vastly improved. “It’s completely changed the way we work—all for the better in my opinion. And I’m an old judge, and we tend to come a bit more slowly to technology changes. I would say that my learning curve was probably 30 days or so, and now I can’t even remember doing it a different way. I think, too, that because the information is so easily accessible, we do better work. We have better access to data so our decision-making is better informed.”

While Montgomery County has long had the desire to be more digital, McDonald said that the Supreme Court’s e-filing directive helped quicken the pace. “I think the e-file mandate streamlined the process. It did push us along.” Now the courthouse even has a kiosk that attorneys can use to e-file their documents before leaving the building.

County Clerk Mark Turnbull pointed out that while Montgomery County is embracing the available technology, it took quite a bit of time to get everybody in different departments on board—and that the county didn’t blaze the paperless trail first. When the county began its foray into different software and companies, many of its employees loaded on a bus and drove north to Collin County, which has an approximate population of 821,000 and has implemented numerous digital improvements to keep up with its steadily increasing population, including electronic and automated records, the conversion of 10 million paper case files into digital images, digitized felony case files, and more.

For those counties that are just getting started or that are considering moving toward a decreased dependency on paper, Shirley said the key is putting together a group of stakeholders and ensuring everybody has “a common vision” of what needs to be achieved.

“We all talk about integrated justice, and realistically we all want some level of integration,” said Shirley. “But as you look across all the different stakeholders—from law enforcement to the DA to the clerks to the courts—they all have their own business processes that need their requirements to be met. And when you look at the big picture, there are typically some trade offs that have to be decided upon. That common goal—consensus building—is what helps you get through that.”

For more information about e-filing, stay tuned for the Texas Bar Journal’s November issue.

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Tuesday, September 23, 2014

Lessons Learned in Small Claims Court – Where Real Lawyers are Made

Originally published by .

We here at Abnormal Use handle a variety of cases, big and small. While it may be the “bet the company” cases that grab the headlines, we have found that small claims court litigation creates the most memorable experiences. With no discovery, no court is less predictable. As you might recall, we have previously offered some helpful observations during our tireless days in the world of small claims. Always at your service, we would like to share a few more of those maxims with you.

1. Check your motion practice at the door. No explanation needed.

2. When the court begins explaining legal principles to a pro se litigant, just go with the flow. If the court addresses the litigant directly, things are going in your favor. Don’t mess it up.

3. Don’t make light of the experience. While some may argue that the appellate level is where “real” lawyering takes place, those people clearly have never stepped foot in a small claims court. The informality of the process can certainly be challenging, but in no other court can a lawyer learn to think on his or her feet in quite such a fashion. Often times, we get so caught up in the rigid rules of litigation that we lose sight of those skills that drove us into the legal field in the first place – creativity, logical thinking, analytics, public speaking. In small claims court, those core skills are your best friend.

Regardless of your number of years of practice, cherish each of your experience in small claims court. At the end of your career, you will find that those experiences are the ones that developed your skills as a lawyer. And, gave you the stories you will remember.

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18+ States Rely on “Stingrays” (Fake Cell Towers) for Surveillance – Is this an Evasion of Privacy?

Originally published by .

Privacy issues have been highlighted by a recent Newsweek report that “mysterious devices sprinkled across America—many of them on military bases—that connect to your phone by mimicking cell phone towers and sucking up your data“ …

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Mary Bowman, "Mitigating Foul Blows"

Originally published by .

Article. Abstract: For nearly eighty years, courts have offered stirring rhetoric about how prosecutors must not strike foul blows in pursuit of convictions. Yet while appellate courts are often quick to condemn prosecutorial trial misconduct, they rarely provide any meaningful…

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Billy the Kid Begins and the GSK China Verdict

Originally published by .

Billy the Kid According to This Day in History, 139 years ago today, Billy the Kid was arrested for the first time, for theft. Billy the Kid was believed to have been born in New York City and was later taken out west by his mother. He was arrested on September 23, 1875 when he was found in possession of clothing and firearms that had been stolen from a Chinese laundry owner. Two days after he was placed in jail, the teenager escaped up the jailhouse chimney. From that point on Billy the Kid was a fugitive. He later broke out of jail and roamed the American West, eventually earning a reputation as an outlaw and murderer, allegedly committing 21 murders.

I thought about the start of Billy the Kid’s outlaw career and more particularly how it ended as I was thinking through some of the issues surrounding the GlaxoSmithKline PLC (GSK) bribery conviction in China last week. For instance, did GSK obtain a negotiated settlement with the Chinese government when it was announced that the company pled guilty to bribery and corruption and was fined almost $500MM by a Chinese court? Further, what lessons can be drawn from the GSK matter for companies operating in China and the compliance practitioner going forward? Today, I want to explore the lessons that a company might be able to draw from the GSK matter.

I think the first lesson to draw is that the Chinese government will focus more on companies than on individuals. Andrew Ward, Patti Waldmeir and Caroline Binham, writing in a Financial Times (FT) article, entitled “Pain from graft scandal likely to linger”, quoted Mak Yuen Teen, a corporate governance expert at the National University of Singapore for the following, “By handing suspended sentences rather than jail terms to Mark Reilly, GSK’s former head of China, and four of his top lieutenants, the court in Hunan province was holding the company more accountable than the individuals.”

However other commentators said, “GSK got off more lightly than expected for bribing doctors to prescribe its drugs.” The article went on to note, “People close to the situation denied that the outcome amounted to a negotiated settlement. But Bing Shaowen, a Chinese pharmaceuticals analyst, said it was likely that GSK made commitments on research and development investment and drug pricing to avoid more draconian treatment. A further FT article by Andrew Ward, Patti Waldmeir and Caroline Binham, entitled “GSK closes a chapter with £300m fine but story likely to run on”, cited Dan Roules, an anti-corruption expert at the Shanghai firm Squire Sanders, who said that he had expected the penalty to be harsher. Roules was quoted as saying “The fact that GSK co-operated with the authorities would have made a difference.” The article went on to say that Roules “pointed to GSK’s statement on Friday pledging to become “a model for reform in China’s healthcare industry” by “supporting China’s scientific development” and increasing access to its products “through pricing flexibility”.”

What about reputational damage leading to a drop in the value of stock? The market had an interesting take on the GSK conviction, it yawned. Moreover, as noted in the FT Lex Column “The stock market was never bothered. The shares moved little when the investigation, and then the fine, were disclosed.” Why did the market have such a reaction? The Lex Column said that one of the reasons might be that the “China may be too small to matter much for now” to the company.

Another lesson is one that Matt Kelly, editor of Compliance Week, wrote about in the context of the ongoing National Football League (NFL) scandal, in an article entitled “The NFL’s True Problem: Misplaced Priorities Trumping Ethics & Compliance”, when he said that a company must align its “core values with its core priorities.” GSK moved towards doing that throughout the last year, during the investigation into the bribery and corruption scandal in China. Although the Chief Executive Officer (CEO) of GSK, Sir Andrew Witty, has been a champion for ethical reform in both the company and greater pharmaceutical industry, the FT reporters noted that the China corruption scandal, coupled with “smaller-scale corruption allegations in the Middle East and Poland, has raised fresh questions about ethical standards and compliance.” If Witty wants to move GSK forward, he must strive to align the company’s business priorities with his (and the company’s) stated ethical values.

Which brings us to some of the successes that GSK has created in the wake of the bribery and corruption scandal. These successes are instructive for the compliance practitioner because they present concrete steps that the compliance practitioner can do to help facilitate such change. As reported by Katie Thomas, in a New York Times (NYT) article entitled “Glaxo to Stop Paying Doctors To Boost Drugs”, one change that GSK has instituted is that it will no longer pay doctors to promote its products and will stop tying compensation of sales representatives to the number of prescriptions doctors write, which were two common pharmaceutical sales practices that have been criticized as troublesome conflicts of interest. While this practice has gone on for many, many years it had been prohibited in the United States through a pharmaceutical industry-imposed ethics code but is still used in other countries outside the US.

In addition to this ban on paying doctors to speak favorably about its products at conferences, GSK will also change its compensation structure so that it will no longer compensate sales representatives based on the number of prescriptions that physicians write, a standard practice that some have said pushed pharmaceutical sales officials to inappropriately promote drugs to doctors. Now GSK pays its sales representatives based on their technical knowledge, the quality of service they provided to clients to improve patient care, and the company’s business performance.

In addition to the obvious conflict of interest, which apparently is an industry wide conflict because multiple companies have engaged in these tactics, there is also clearly the opportunity for abuse leading to allegations of illegal bribery and corruption. Indeed one of the key bribery schemes alleged to have been used by GSK in China was to pay doctors, hospital administrators and other government officials, bonuses based upon the amount of GSK pharmaceutical products, which they may have prescribed to patients. But with this new program in place, perhaps GSK may have “removed the incentive to do anything inappropriate.”

This new compensation and marketing program by GSK demonstrates that companies can make substantive changes in compensation, which promote not only better compliance but also promote better business relationships. A company spokesman interviewed the NYT piece noted that the changes GSK will make abroad had already been made in the US and because of these changes, “the experience in the United states had been positive and had improved relationships with doctors and medical institutions.”

In addition to these changes in compensation and marketing, Ward/Waldmeir/Binham, reported that GSK announced it would strive to be “a model for reform in China’s healthcare industry” by “supporting China’s scientific development” and increasing access to its products “through pricing flexibility”. They further stated “Rival companies will now be watching nervously to see whether more enforcement action takes place in a sector where inducements for prescribing drugs have long been an important source of income for poorly paid Chinese medics,” which is probably not going to be a return the wild west of bribery and corruption that occurred over the past few years in China. Bing Shaowen was quoted as saying that the GSK matter “is a very historic case for the Chinese pharmaceutical industry. It means that strict compliance will become the routine and the previous drug marketing and sales methods must be abolished.”

Whatever you might think of the GSK result, the company certainly ended its legal journey better in China than Billy the Kid did in New Mexico. But the company still faces real work to rebuild its reputation in China. Moreover, it still faces legal scrutiny for its conduct in the UK under the Bribery Act and the US under the Foreign Corrupt Practices Acct (FCPA). So stay tuned…

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2014

Filed under: Best Practices, Bribery Act, China, compliance programs, Compliance Week, Corruption in China, FCPA, Financial Times, GlaxoSmithKline, Matt Kelly Tagged: best practices, Bribery Act, compliance, compliance programs, FCPA, FT, GSK

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Monday, September 22, 2014

Technology to Battle Distracted Driving

Originally published by .

These sensors were designed by Seeing Machines, an Australian technology company, and were manufactured by Takata, a Japanese safety equipment company. According to CBS News, during a recent interview, Ken Kroeger, the CEO of Seeing Machines stated, “Eye and head tracking technology is the next step in automotive safety, which we expect to play a significant role in the reduction of one of the greatest causes of accidents: driver distraction.”

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Bad Faith Case Against Safeco Abated, Not Dismissed, in Florida

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Recently the Fourth District Court of Appeal (“4th DCA”) abated a bad faith case brought against Safeco. The underlying issue of coverage was also involved in the lawsuit. We have often discussed how Florida law requires a determination of liability and extent of damages before a bad faith action can proceed. The 4th DCA decided to abate and not dismiss a bad faith action against Safeco Insurance Company in an opinion issued September 17, 2014.1

Ms. Beare sued third parties because of injuries she sustained in an automobile accident. Those parties settled and Ms. Beare amended her complaint to add her insurance carrier, Safeco, for uninsured/underinsured benefits (“UM”) under her policy and for bad faith refusal to settle her claim. Safeco answered the UM claim, but filed a motion to dismiss the bad faith claim as premature. The trial court abated the bad faith count instead of dismissing it. Safeco filed a petition to the 4th DCA arguing it was irreparably…


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"[G]rand jury in Ferguson shooting receives full measure of case"

Originally published by .

I recall that during the prosecution of George Zimmerman for the homicide of Trayvon Martin, the Florida prosecutors filed a probably cause affidavit that omitted exculpatory and explanatory facts. At the time I wondered if Florida procedure and ethics rules…

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Say What?! – Did They Really Say That?

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From John T. McCully of Dallas, this excerpt from the examination of a police officer in a DWI case:

Q. At the time the defendant stepped out of the car … did you have any idea that this may be a driving while intoxication investigation?

A. No. I thought it was just an accident.

Q. At what point did you make that determination that you may have a driving while intoxication investigation?

A. It took him, you know, a full minute to get his driver’s license out of his wallet. And plus at the same time, I smelled a strong odor of alcoholic beverage.

Q. After you smelled the alcohol and the driver’s license, what did you do then, officer?

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Friday, September 19, 2014

Ninth Circuit on perjury for Barry Bonds’s wandering answer — is half the bar at risk?

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Story at WSJ about the en banc hearing on Barry Bonds’s conviction for perjury for a wandering and possibly evasive answer. (More at LA Times.) Judge Fletcher noted the prevalence of wandering answers in civil discovery and commented,”“half the bar…

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Top 10 From Texas Bar Today: Disgust, Salsa, and Fixodent

Originally published by .

To highlight some of the posts that stand out from the crowd, the editors of Texas Bar Today have created a list from the week’s blog posts of the top ten based on subject matter, writing style, headline, and imagery. We hope you enjoy this installment.

10. Can biochar reduce the environmental impact of drilling?

9. Does Your Company or Law Firm Have a Plan on How to Respond to Data Breaches?

8. 3 IoT (Internet of Things) Cyber Threats to Privacy in Your Home That Might Surprise You

7. John Doe Can Remain Anonymous and Not Be Deposed in Pre-Litigation Discovery

6. What do the new iPhone, football uniforms and the U.S. Constitution have in common?

5. Fixodent Lawsuit Has No Teeth: Eleventh Circuit Court Affirms Dismissal On Daubert Grounds


3. The Disgust Scale: How Have We Missed This All This Time?

2. Salsa maker accused of stealing name

1. The regulation, my friend, is blowin’ in the wind.

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Tom Keyser: The Living Years

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The following article originally appeared in San Antonio Lawyer magazine and is reprinted with permission from San Antonio Lawyer and the San Antonio Bar Association.

By Steve Peirce

Tom Keyser stood on a chair in the gym of his rented townhouse, a rope tied around his neck. He once was a Catholic school kid from Cumberland, Maryland, who had shown such promise as a baseball player that he was drafted in 1967 by the Baltimore Orioles, and now he was a father of three who had lost his marriage and his home, and was about to lose his law license. All he had to do was take one small step and the pain would be over, but he lost his nerve. It was the Summer of 1990.

In the summer of 2014, Tom Keyser is having lunch with me at Mrs. Kitchen’s Soul Food Restaurant and Bakery. Tom’s digging the joyous James Brown song being played in the background. “I feel good,” he says (Tom, not James), “except for a little pain in my back from hoisting grandkids.” Tom is a music lover, and he wants to tell me about the inspirational songs he’s chosen to play at the installation bar gala, where he will be honored as the 2014 San Antonio Bar Association President. “Mike and the Mechanics have a great song called ‘The Living Years,’ about spending time with the ones you love before they die. Give it a listen,” he says.

It’s another late morning for Tom Keyser. He feels his way around the house. The electricity has been cut off. He sneaks out to his neighbor’s yard and steals the Sunday newspaper, hoping to win the loteria and wingo games the paper used to have in the 1980s and 1990s. No luck today. Since his water has also been cut off, Tom takes his neighbor’s garden hose and uses it to give himself a shower in the yard. He’s got no car, so he rides his son’s bicycle to the Exxon station to pick up a quart of Mickey’s malt liquor for breakfast. Sunday morning is coming down.

“How about a refill of your water, Mr. Tom?” the waitress at Mrs. Kitchen’s asks.

“Sure, and my friend here will have some more Kool-Aid,” says Tom. (Actually, I’m drinking “the hook,” which is a mix of lemonade and cherry Kool-Aid.) Tom doesn’t put anything exotic in his body any more, even if it’s just a sugary East Side concoction. “I’d really like to get membership up,” Tom says. “Did you know that we have 6,000 lawyers in Bexar County and only about 3,000 are SABA members? We’ve got forty judges that aren’t even SABA members. Lawyers ask me what SABA can do for them, and I ask them what they can do for SABA.” Coming from someone else, this might seem like a meaningless platitude, an arrow from a quiver of stock phrases that one might whip out for an interview. Coming from Tom Keyser, and knowing who he is, it sounds almost as moving as when JFK spoke similar words.

It’s 1982, and Tom Keyser is playing softball for San Antonio Blue. Life is good. Tom’s making good money working for Oliver Heard’s law firm. Tom’s married to his college sweetheart, Harriet. He’s got three beautiful children, a home in Oak Hills, and a Porsche in the driveway. San Antonio Blue is a hard-partying group with lots to celebrate, being on their way to what would be nine consecutive state championships. The Blues Brothers are popular at the time, and Tom’s teammates wager him $500 that he won’t dress up as Jake Blues (John Belushi’s character) and dance with Spurs super-fan Gene, Gene, the Dancing Machine at the next Spurs game. So the bet’s on. On the way to the game, after a few drinks and some pot smoking, Gene offers Tom some cocaine. Tom snorts cocaine for the first time. He’s 35. People tell Tom that his “Soul Man” choreography is spot-on, and he wins the bet. Tom might have looked like he was on a mission from God, but his descent into Hell was just getting started. He got addicted to cocaine.

It would be hard to picture 67-year old Tom Keyser dancing wildly at a Spurs game today. Not because he’s not physically able. Far from it, Tom is still playing baseball in the men’s senior league (he would play catcher the next Sunday afternoon game in the 98-degree heat). Today you see a humble, soft-spoken, sober man who exudes sincerity. He’s wrinkled, even more, weathered, in part because of his time in the sun playing baseball, but maybe in larger part from the repeated ass-kickings he took in the 1980s, when he threw it all away. “There’s a great song by Phil Collins, called ‘Another Day in Paradise,’ about the homeless,” he says. “You should listen to it. I want the bar association to try to do more for the homeless.” Tom’s not just blowing smoke; but for the help of others and his own resolve, he would be among their ranks today, if not dead.

In 1989, Tom Keyser looked toward the gulf from the beach in Port Aransas. After a long night of partying, he’d left the Porsche out on the beach too close to the water, and the high tide had gotten it. A $20,000 vehicle, just ruined. A minor loss, compared to some of the others. In 1984, he was arrested for possession of cocaine. He was sentenced by Judge Tom Rickoff to community service: build a baseball park at Old Blanco Park, which he did. Judge Rickoff also told him to get help, which he didn’t. Instead, Tom decided that the thing to do was kick the cocaine habit by using crystal meth instead, so then the speed addiction took hold. He had previously served on the grievance committee, but after the cocaine arrest, the grievance committee was coming after him. In 1986, Harriet divorced him. In 1988, he filed bankruptcy. Unbeknownst to Tom at the time, because he hadn’t been paying attention, he had over $200,000 in IRS debt out there, gaining penalties and interest every day. Another thing that was yet to come was his arrest on Mother’s Day Weekend in 1990 for passing hot checks, where he was handcuffed by the police while his son Mike watched. Then there would be the suspension of his law license, where he physically handed his bar card and law license over to the clerk of the Texas Supreme Court on March 15, 1991.

“So we’re playing in this men’s senior league World Series game in Phoenix,” Tom says, offering me some cornbread. “And all of a sudden the pitcher on the other team collapses with a heart attack. They have a defibrillator on hand at the ball field, and one of our guys, Earl Smith, is a doctor. Earl uses the defibrillator to save the guy’s life right there. Come to find out that there’s only two defibrillators at the Bexar County Courthouse, one in the District Attorney’s office, and one in the Sheriff’s office, hardly accessible to everyone.” So Tom goes on a quest to put defibrillators in the courthouse, and raises $15,000 for eight defibrillators. “Maybe we can save someone’s life,” he says, enjoying another bite of meat loaf. Marvin Gaye sings, “I ain’t got time to discuss the weather, or how long it’s gonna last.”

There were other preparations for an early death during that lost decade. The deer rifle and the shotgun stayed loaded and were often pointed where they shouldn’t be, but it looked like Tom was going to opt for the slow suicide of so many drug addicts. But Tom got a call from an old friend, whom he refers to as an angel, a personal Clarence Oddbody, who invited him for coffee and a trip to Club 12, a local chapter of Alcoholics Anonymous. Tom found a lot of laughter and caring at the meeting, with the plea to “keep coming back.” With the help of his sister, who gave him a place to stay and loaned him a car to go to the meetings, he kept coming back. Tom’s been sober since November 11, 1990.

Now I’m trying to sit still during ‘Hollywood Swingin’ ’ and finish my macaroni and cheese, and Tom lays it on me. “You gotta get outside yourself.” He thinks hard about what he’s about to say, bowing his head and squinting (there’s that sincerity again). “What I mean is, if we do something for our brothers and sisters, either inside the bar or outside in the community, it will make us better. Sometimes we get too wrapped up in ourselves. You know that law school applications are down 37%? We’re a chosen profession, and we can make a difference. There’s a dozen sections in SABA, and another half-dozen other local bar associations. Find a way to get involved.”

Of course, life isn’t as simple as just getting sober and living happily ever after. Six months into his sobriety, Tom finds out about the IRS debt, and he’s still suspended from practicing law. These problems paled in comparison to the broken relationships that needed healing. But he stayed the course, kept going to the meetings, and started taking care of business. He completed an offer in compromise with the tax man, and repaid friends, family, and business associates another $100,000. He regained his law license, and was even re-appointed to the grievance committee. In 1994, he started playing baseball again. He repaired his relationship with Harriet and his now-adult kids, attending their graduation ceremonies, weddings, and swearing his son Shane into the law profession. In 2002, he got married again, to Constance Lindsey. This summer, he took his entire extended and blended family, fifteen in all, to San Diego, where they enjoyed a Padres game together. He speaks to young lawyers and law students about career killers. In 2009, he and a friend, Tim Langanke, produced a mini-documentary called Tom’s Story, detailing his addiction problems and his road back to sobriety, which is shown in continuing education and to anyone else it can inspire. He practices family law and criminal law, and uses his personal experiences in both to counsel clients. It’s not recommended as a marketing tool, but some clients have sought him out because he’s been there, too.

Tom Keyser carries a lot of darkness on his back, more than you know from this article, and he carries it with dignity. He can’t save the world, but that won’t stop him from trying to do whatever he can. He’s in the living years, and when you’ve been in the dying years, there’s still a lot left to do. Let’s hope he hits a home run.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.

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