Texas Lawyer Blog

Donut dilution suit

The Canton, Mass.-based companies that own Dunkin' Donuts and Baskin-Robbins are suing two of their Texas franchisees for allegedly falling short of company standards relating to health, sanitation and safety. In Dunkin' Donuts Franchised Restaurants LLC, et al. v. Sunrin Group Inc. and Saloni Enterprises Inc., filed Aug. 28 in U.S. District Court for the Eastern District of Texas, the two major brands sued franchisees in Plano and Carrollton that sell both donuts and ice cream (awesome combination) for alleged breach of contract, trademark infringement, unfair competition and trademark dilution. "Defendants' actions," the plaintiffs allege, "have caused and continue to cause irreparable harm to Plaintiffs, including harm to Plaintiffs' reputation and goodwill." The brands seek an injunction requiring the franchisees to clean up their allegedly bad acts. When I first heard about this suit, I was shocked that Dunkin' Donuts shops actually exist in Texas. Then I remembered someone brought a box of Dunkin' Donuts to work here at Texas Lawyer one day. They were delicious.
-- Jonathan Fox

New fees for case filings

Fees are going up on Sept. 1 for case filings at the Texas Supreme Court, mid-level appellate courts and the Judicial Panel on Multidistrict Litigation (MDL). The Supreme Court established a new fee schedule in an order signed on Aug. 28 by all justices on the court. The order incorporates a new $50 filing fee for various filings in the Supreme Court and intermediate courts of appeals that the Texas Legislature authorized when it passed S.B. 1182 earlier this year. Among the filings subject to the new fee schedule are original proceedings in the Supreme Court and courts of appeals, petitions for review and direct appeals. Osler McCarthy, spokesman for the Supreme Court, says, for example, that the fee for filing a petition for review increases from $75 to $125. New fees also apply to two types of filings before the MDL panel. There is now a $275 fee for filing a motion to transfer to pretrial court under Rule of Judicial Administration 13.3(a) or an appeal of an order of a pretrial court by a rehearing motion under Rule 13.5(e). The fee for filing any other motion or document under Rule of Judicial Administration 13 is $50, according to the court’s order. McCarthy says filings for certified questions from the 5th U.S. Circuit Court of Appeals are not subject to the $50 fee increase. The fee for those filings increases from $125 to $150, he says. The Supreme Court’s order also makes changes in the existing fee structure.  Clerks at the courts of appeals are authorized to collect a $15 fee for filing motions for rehearing or en banc reconsideration by a court and a $25 fee for filing oral argument exhibits. Under S.B. 1182, money from the new fees must be used to defray the Supreme Court’s operational costs.

-- Mary Alice Robbins

Beer spat could make microbrew scarce in Texas

New Belgium Brewing Co. (NBB) of Fort Collins, Colo., makes some delicious microbrew beers, including Fat Tire Amber Ale. But Farmers Branch-based Glazer's Wholesale Drug Co. Inc., one of NBB's Texas distributors, says the brewer's alleged attempts to compel the distributor to sell its distribution rights to a consortium of other distributors at a price "far below the fair market value" has left a bad aftertaste. In Glazer's Wholesale Drug Co. Inc. v. New Belgium Brewing Co. Inc., filed July 26 in Dallas County district court, Glazer's alleges that "NBB has threatened on several occasions that it will cease selling Fat Tire beer to Glazer's or anyone else in Texas, rather than (i) permit Glazer's to continue as its distributor in certain cities, or (ii) allow Glazer's to sell its distribution rights to qualified beer distributors at fair market value." Glazer's is suing for declaratory relief under the Texas Alcoholic Beverage Code, alleging tortious interference with prospective business relations and violations of the Texas Beer Industry Fair Dealing Law, found in §102.72(a)(1) of the beverage code. On Aug. 24, NBB removed the suit to the U.S. District Court for the Northern District of Texas.
-- Jonathan Fox

Wing clipped in Tyler

Tyler solo Michael J. Wing will soon have plenty of time to think about how he could have put his law degree to better use after U.S. District Judge Leonard Davis sentenced him to 10 years in federal prison for wire fraud on Aug. 30. Wing pleaded guilty last year after he was indicted for luring potential investors by representing that their money would be used to purchase short-term securities from Fortune 500 companies. Wing specifically represented that he was an international mergers and acquisition lawyer who had been retained by a Fortune 500 company, that the company was in the final stages of closing a major merger or acquisition, and that the company needed short-term financing to complete the acquisition, according to the U.S. Attorney’s Office for the Eastern District of Texas. Prosecutors alleged that Wing took that money and spent it, using some of it to pay off other investors. As part as his sentence, Wing was ordered to pay $9.1 million in restitution. Wing might want to consider opening a lemonade stand in 2017 to help pay the restitution because the State Bar of Texas Web site currently lists his law license as suspended.

-- John Council

Allegedly false FEMA claims

It’s hurricane season on the Gulf Coast, which brings back horrific memories of the late summer of 2005 when Hurricane Katrina and Hurricane Rita devastated Louisiana, Mississippi, East Texas and elsewhere. Katrina hit land on Aug. 29, 2005, and Rita roared through Texas on Sept. 24, 2005. It’s been two years since the storms, but the legal repercussions continue. On Aug. 16, the U.S. Attorney’s Office for the Southern District of Texas unsealed an indictment charging 10 Houston-area individuals with conspiring to file more than 75 fraudulent Federal Emergency Management Agency claims for Katrina and Rita assistance. The indictment charges all 10 defendants with one count of conspiring to file false claims, stealing from the federal government and committing mail fraud. The government alleges FEMA paid more than $92,000 on those claims. The 10 individuals named in that indictment aren’t the only ones who allegedly  tried to take advantage of the misfortune of others by filing false claims with FEMA. According to the U.S. Attorney’s Office for the Southern District of Texas, a total of 59 individuals have been charged in the district with fraud related to Katrina and Rita.

-- Brenda Sapino Jeffreys

Prosecution expected to rest in HLF case

The prosecution in United States v. Holy Land Foundation for Relief and Development, et al. inched closer to an end today as prosecutors are expected to rest their case in the trial against a Richardson-based charity and five individuals who allegedly funneled more than $12.4 million to Hamas, a Palestinian terrorist organization. The trial began on July 16 before Chief U.S. District Judge A. Joe Fish of Dallas and involves five individual defendants who allegedly engaged in prohibited financial transactions with a specially designated terrorist, money laundering and conspiracy. The defendants have pleaded not guilty and have stated repeatedly in pleadings that the charity sent money it raised to individuals and groups in the West Bank and Gaza for humanitarian purposes. The defense portion of the case is expected to last two weeks.

-- John Council

Porter & Hedges bonuses NOT automatic

Houston's Porter & Hedges, as I reported on Tex Parte yesterday, is increasing associate salaries and bolstering associates' performance-based bonus possibilities by no longer linking those year-end treats to billable-hour targets. But I incorrectly reported that bonuses at Porter & Hedges will be automatic. They will NOT. When it comes to bonuses, I should have known, they are never automatic. Sorry for the error.

-- Miriam Rozen

Judge Kent absent

There is a one-page order, but not much in the way of explanation as to why U.S. District Judge Sam Kent of Galveston will be absent from his bench from Sept. 1 until Jan. 1, 2008. The Aug. 23 “Temporary Order for Disposition of the Galveston Docket” is signed by Hayden Head, chief judge of the Southern District of Texas. “The order speaks for itself,” Head says. Kent did not return a call for comment. According to the order, U.S. District Judge John Rainey of Houston will assume Kent’s portion of the Galveston Division cases. On May 25, Head issued another order --- with Kent’s consent --- that randomly reassigned 30 percent of Kent’s docket to Rainey and U.S. District Judge Gray Miller of Houston.

-- John Council

Still under God

Texas schoolchildren can recite the state Pledge of Allegiance with the recently inserted phrase “one state under God” as a result of a federal judge’s ruling on Tuesday. U.S. District Judge Ed Kinkeade of Dallas denied a motion for a preliminary injunction sought in Croft v. Perry to stop children from reciting the state pledge that the Texas Legislature modified during its 2007 session.  Plaintiffs David and Shannon Croft had argued in their original complaint filed this month that the application of Texas Government Code §3100.101 – which prescribes the “one state under God” language in the pledge – is fundamentally flawed. The Crofts had alleged in their complaint that their children, who attend school in the Carrollton-Farmers Branch district, will be injured by potentially hearing and seeing other children reciting the Texas pledge. According to Kinkeade’s order, the Crofts failed to show they will suffer irreparable injury.  The real question here is how many Texans know there is a state Pledge of Allegiance and can recite it – with or without the new language?
-- Mary Alice Robbins

Filing suit unnecessary

Without having to file a suit, the state has collected $1.86 million from Seattle-based Emeritus Corp., according to a settlement agreement reached after the Texas Office of the Attorney General (OAG) investigated Emeritus for alleged fraud in Medicaid billings for its assisted living facilities.  “There was no lawsuit, no filing at the courthouse,” says OAG spokesman Tom Kelley. Emeritus paid the state on Aug. 24, Kelley says. As noted in the settlement, the state contends that Emeritus made false claims and false statements in reimbursement claims that the corporation submitted to Texas under the Medicaid program.  Specifically, as alleged by the state in the settlement agreement, Emeritus routinely submitted false claims to the Medicaid program seeking reimbursement for housing options in its assisting living facilities that were not provided – such as kitchen areas. According to the agreement, Emeritus denies all allegations of wrongdoing.  Mark J. Biros, Emeritus’ attorney and a partner in Proskauer Rose in Washington, D.C., says his client settled to avoid the expense of litigation.  “It happens all the time,” Biros says.   
-- Mary Alice Robbins

Porter & Hedges raises associate salaries

Houston's Porter & Hedges announced today that it is raising salaries for first- and second-year associates to $160,000 and $170,000 respectively effective Sept. 1. Third-year associates will also receive an increase but Charles Baker, a partner on the management committee, says the firm has decided not to release the amount. Baker says the firm's more senior associates will also receive salary increases on an individual basis, not in lockstep. He says the 94-lawyer firm will no longer set a minimum yearly billable-hour requirement for associates to meet to receive bonuses. Instead, Baker says, associates will receive bonuses automatically, even if they don't meet billable-hour targets. "We didn't want to do something that was a knee-jerk reaction. We wanted to do something fair and right," says Baker.

-- Miriam Rozen

Beaumont lawyer pleads to mail fraud

Former Jefferson County Assistant District Attorney Wendell “Chip” Radford Jr.’s side job got him a five-month prison sentence from U.S. Magistrate Judge Marcia Crone of Beaumont on Aug. 24. Crone also sentenced the former Beaumont attorney to five months of home confinement and ordered him to pay $393,433. 53 in restitution. Radford pleaded guilty to one count of mail fraud after he was accused last year of helping set up a shell company and disguise a kickback plan for a client he represented in his civil practice. As part of his guilty plea, Radford agreed to turn in his bar card. Radford’s troubles are an extreme example of why allowing prosecutors who work in big city DA's offices to have civil practices on the side is a bad idea. Sure, prosecutors don’t make what civil lawyers do and could use the extra income. But if they want to make more money, it’s best for them to leave the DA’s office and enter private practice.

-- John Council   

Watts sets his sights on Dallas

One might say that Mikal Watts, a Democrat running for the U.S. Senate, is seeing Dallas with a new set of eyes this morning. Watts, of the Watts Law Firm in San Antonio, is meeting with local Democrats today at the Adolphus Hotel in downtown Dallas without his customary eye glasses thanks to the laser eye surgery he had in April. And there’s a much different political landscape for Watts to see since Dallas County went Democrat in the 2006 general election, in which more than 40 contested judicial races were won by candidates with a D next to their names. Dallas is a big part of Watts’ strategic plan to win the Democratic primary and defeat U.S. Sen. John Cornyn, R-Texas. “I’m going to spend an enormous amount of time in Dallas County,” Watts says. “It doesn’t do a statewide candidate any good to fight to a draw in Dallas. We need to win Dallas County by a wide margin.”

-- John Council

Lunch truck vendors allege new law discriminates

Several mobile food vendors in Houston say a new state law requiring them to return their "lunch trucks" to a home base every day for cleaning and to get permission from landowners to sell food on their properties would make it impossible for them to operate. In Cortes, et al. v. Texas, filed Aug. 24 in U.S. District Court for the Southern District of Texas, the vendors allege that the state is discriminating against them because owners of mobile food units (MFUs) are primarily Hispanic. The law focuses "solely on the business affairs of Hispanics with no substantial relationship to any legitimate government interest," the plaintiffs allege. The suit, which seeks an injunction against the law, compares the plight of Hispanic lunch truck owners in Houston to Chinese laundry owners in the famous 1886 U.S. Supreme Court case Yick Wo v. Hopkins, which struck down a law that prohibited laundries from operating in wooden buildings while allowing non-Asians an exemption from the law.  The new law, found in Chapter 437 of the Texas Health & Safety Code, appears to apply only to Harris County. It requires that large counties establish rules for the safe installation, operation and transport of propane tanks used by the lunch trucks. It also requires lunch truck owners to document daily cleanings of their units and to display notarized proof of authorization to sell food on others' land. The restrictions are discriminatory, the lunch truck owners allege, because owners of stationary trailers selling barbeque, gas stations that sell food and restaurants need not undergo the same scrutiny. Without Hispanic-run MFUs, the plaintiffs claim, hungry workers will be forced to buy food from "corporate owned fast food restaurants and gas stations."
-- Jonathan Fox

Business leaders must unite against trial bar

Even though Texas lawmakers passed the most comprehensive --- and restrictive --- tort reform measures in the state's history four years ago, the  fight is not over. At least, that's what Steven B. Hantler, chairman of the American Justice Partnership, a national tort reform group, told a meeting of business leaders in Dallas on Aug. 24. Hantler, who also is assistant general counsel of Daimler Chrysler, told a meeting of the Dallas Friday Group that while Texas is a leading state in tort reform, business leaders can't afford to sit on their hands.  "You've done a good job beating back the trial bar," Hantler told the group. "But the trial bar is not done." Hantler then put the fear of God into the businesspeople, telling them that at this very moment, ''there are dozens if not hundreds of trial lawyers researching companies . . . trying to find the proverbial billion dollar lawsuit." So does Hantler think Texas needs even more tort reform? Not necessarily, he said after his speech in an interview. So what was the purpose of his speech? "The purpose was to wake people out of complacency that they've won," Hantler says. "We must continue to push for fair and balanced laws."

-- John Council

V&E: "No discussions" with the AG

U.S. Attorney General Alberto Gonzales didn't answer any questions at his speedy news conference this morning so I don't know if he's coming back to Texas. But I do know that if he plans to return to the state, he hasn't yet investigated the possibility of returning to Vinson & Elkins, the Houston-based firm where Gonzales began practicing in the early 1980s after graduating from Harvard Law School. Gonzales became a V&E partner in the early 1990s. According to a statement issued this morning by V&E managing partner Joe Dilg:  "There have been no discussions with Attorney General Gonzales about him returning to V&E."

-- Miriam Rozen

Medical assistants' school seeks would-be electricians

The Texas Supreme Court on Aug. 24 handed down several opinions construing arbitration clauses, and the facts of one of the cases could be the basis of a Monty Python or "Saturday Night Live" skit. In In Re: Kaplan Higher Education Corp. and Leticia Ventura, 45 students enrolled in an electrician's program at a vocational college sued the college, alleging they were fraudulently induced to sign up by "assurances that upon graduation they would be eligible for licenses as journeymen or master electricians." Although hindsight is always 20/20, the students should have been tipped off from the beginning that something was amiss. Why, you ask? Because the name of their school was the San Antonio College of Medical and Dental Assistants. The school's Web site says that its electrical technician program is "designed to prepare you with the knowledge, technical skills, and work habits required for an entry-level position as an electrical technician." The school, owned by Kaplan Higher Education Corp., also has information technology classes. I have another idea for the name of a vocational school: The school of criminal justice, massage and interpretive dance.
-- Jonathan Fox

Law by design

Forget the dark paneling, massive conference tables and shelf-upon-shelf of legal tomes. Today’s nouveaux/contemporary law office design stands in stark contrast to the décor of old. Just look at Susman Godfrey’s new digs in Houston, the architect for which recently received the 2007 Design Excellence Award in the corporate category from the Texas/Oklahoma Chapter of the International Interior Design Association. San Francisco-based Gensler designed the space to combine modern style with a wide range of paintings and sculptures from prominent contemporary artists — including Robert Rauschenberg, Geoff Winningham and Perry House. One unique feature is a 35-foot illuminated color lobby wall that cycles through different colors while guests wait. Attorney offices are custom-furnished to express each lawyer’s personality, and other perks include conference rooms outfitted with the latest high-tech capabilities, kitchen areas featuring stainless steel appliances and marble-countered bathrooms. “Our office space reflects who we are and how we practice law. It says ‘we’re trendsetters’ and will certainly raise the level of excitement with any potential associate who comes for an interview with our firm,” Kim Herbsleb, Susman’s recruiter, said. Gensler also received the 2006 Commercial Design Excellence Award for its design of the firm’s new Dallas office.

— Kristine Hughes

Funding for two firsts

Grant awards that the Texas Task Force on Indigent Defense announced on Aug. 24 will help establish two firsts for the state.  The task force awarded $685,685 to establish the state’s first regional public defender for capital murder cases in 85 West Texas counties.  Beginning in January 2008, the public defender office will serve counties in the 7th and 9th Administrative Judicial Regions, extending from Dallam County at the top of the Panhandle to Mills County in Central Texas.  The task force also awarded a $586,477 grant to establish a public defender office to serve Bowie and Red River counties in Northeast Texas.  The program, which will be operated by Bowie County, will be the state’s first county-operated public defender office that will provide representation to indigents in all indigent cases except capital murder cases in which the death penalty is sought. Texas finally is making substantial headway in creating public defender offices that should improve representation for indigents accused of crimes. 
-- Mary Alice Robbins

Munsch, Hardt won't move on salaries

Munsch, Hardt, Kopf & Harr will stick with a $135,000 base salary for first-year associates. The 103-lawyer firm will not increase associate salaries to meet a new Texas market rate of $160,000 for first-year lawyers. Glenn Callison, the Dallas-based firm’s chairman and chief executive officer, says the firm’s management committee decided on Aug. 23 to stick with the current associate salary scale, because of a concern that increasing associate salaries would force the firm to increase billing rates in the near future. “It’s a question of our position in the marketplace and what we see as an excellent opportunity with clients,” he says. “We believe clients of all sizes are going to have push-back at the continued increases in billing rates. We see that as a great opportunity for us.” In the weeks since Houston-based Vinson & Elkins adopted a new salary scale calling for a $160,000 base for first-year associates, a number of BigTex firms have moved to the new, higher first-year rate and some have bumped up their entire associate salary scale. Callison says Munsch, Hardt will stick to its year-end salary and merit-based bonus review, where associates are rewarded based on individual merit. Callison says the management committee talked with lawyers at all levels before making the decision to maintain the current associate salary scale. “There is a very strong concensus throughout the firm that this is the right direction for us. We felt it was very important to make this move and at the same time make a strong statement who we are and where we are positioned in the marketplace,” he says.

-- Brenda Sapino Jeffreys

High court meant what it said

In a per curiam opinion, a testy Texas Supreme Court reaffirms that unjust enrichment claims are governed by the two-year statute of limitations – an issue the court has addressed twice before. In its Aug. 24 opinion in Elledge v. Friberg-Cooper Water Supply Corp., the high court reversed the 2nd Court of Appeals’ 2-1 holding in June 2006 that the four-year statute of limitations for actions on debt applies to suits seeking restitution for unjust enrichment.  The 2nd Court’s opinion, written by Justice Anne Gardner, characterizes as nonbinding “obiter dictum” the Supreme Court’s prior discussions on the statute of limitations in 1998’s HECI Exploration Co. v. Neel and 2001’s Wagner & Brown Ltd. v. Horwood.   According to the 2nd Court’s opinion, the language in HECI and Wagner & Brown indicates that the Supreme Court did not consider its statements in the two cases “as even being judicial dictum.”  That’s just wrong, the Supreme Court said in Friberg-Cooper.  “We reject the court of appeals’ ‘obiter dictum’ label.  Our statements that the two-year statute applies to unjust enrichment claims, though not essential to the outcomes in HECI and Wagner & Brown, should have been followed,” the Supreme Court wrote in the opinion.  Now, does anyone have any doubts about which statute of limitations applies?
-- Mary Alice Robbins

Short and sweet

Mayer, Brown, Rowe & Maw will soon slim down its name, striking two names, two commas and an ampersand. Beginning Sept. 1, the Chicago-based firm that has a 76-lawyer office in Houston will be known simply as Mayer Brown. The firm has used the Mayer, Brown, Rowe & Maw name since 2002, when Chicago’s Mayer, Brown & Platt merged with London-based Rowe & Maw. The firm has about 1,500 lawyers in 14 offices, including seven in the United States and seven outside the country.
-- by Brenda Sapino Jeffreys

Called -- forced? -- to serve

In a survey conducted by Citizens Against Lawsuit Abuse of Central Texas, 90 percent of the respondents said Texans should be held accountable for ignoring a jury summons. The survey results, released this week, also show that 400 of the Texas voters polled favor increasing the fine — now $100 — to $1,000 for failing to report for jury duty, and 51 percent favor suspending the driver’s license of anyone who is a repeat no-show when summoned for jury duty. On hand for CALA’s Aug. 22 news conference was former Texas Supreme Court Justice Craig Enoch, now a shareholder in Winstead in Austin. Enoch says his friend Bobby Jenkins, CALA’s vice chairman, had asked whether Enoch had an interest in the issue of jury no-shows. As it turns out, it is an issue about which Enoch has first-hand knowledge. Enoch says he had to deal with people not responding to jury summons during his term as judge of the 101st District Court in Dallas in the 1980s. Enoch says the Dallas courts always had concerns about whether there was an ample pool of jurors for the cases to be heard. Another concern, Enoch says, was whether the jury pools would be representative of the community. In 2005, the Texas Legislature boosted juror pay to $40 a day after the first day of service. Enoch says the Legislature has done its part to encourage Texas citizens to serve on juries. The judiciary now must better educate the public about the importance of jury service and judges must accept fewer excuses for not serving, he says. That may be a little easier for Enoch than for judges still on the bench who must run for re-election.
-- Mary Alice Robbins

Would Jesus attend this seminar?

Certainly sounds like he would, if he read the online brochure touting the Christian Trial Lawyers Association’s “Major League Trial Tactics Seminar” scheduled in Houston Aug. 23-24. So what if it has already begun. There is still time to attend part of it if you are a Christian and a trial lawyer, which would certainly seem to some (tort reformers) as a bit oxymoronic. But you might be converted to the cause if you read the CTLA’s mission statement in the brochure: “Members want to exemplify Christ-like character in their homes, offices, courtrooms and communities.” “They want to advance Christian principles through ethical training to colleagues and in society at large.” “They are well aware of their own flaws, but they also know something of the power of the Lord in their lives and hope to prove conventional wisdom wrong in its typical view of trial lawyers as greedy, selfish and prideful.” The seminar, carrying through on its baseball theme, is being held in a meeting room on the mezzanine level of Minute Maid Park. The “Lineup of Speakers” has something for everyone — secular and nonsecular alike. The featured speaker is that dogmatic pursuer of presidents, Kenneth Starr, who is currently dean of Pepperdine University School of Law in Malibu, Calif. Harris County District Judges Mark Davidson, Elizabeth Ray and John Roberts are also slated to speak. And no CTLA program would be complete without the charismatic presence of its founder, Houston attorney W. Mark Lanier who has wowed juries in Texas and New Jersey with his representation of plaintiffs in Vioxx-related cases. If this lineup doesn’t draw you in, the Christian Trial Lawyers Association is offering participants  free tickets to a Houston Astros game.

-- Mark Donald

Need for speed

Mark L. Jones got his license to speed last week, and he used it to travel 185 mph in a modified 1927 Ford Model T roadster. The corporate partner in Porter & Hedges in Houston was part of a team from the Houston Roadsters Club — dubbed Contrivance Engineering — that participated in Bonneville Speed Week, an annual event on the salt flats of Utah. Drivers from all over the world shoot for land-speed records in hot rods, roadsters, belly tankers, lakesters, motorcycles, streamliners and even diesel trucks. As part of the Aug. 11-17 event, Jones received special training and demonstrated sufficient driving skills to earn a license to drive up to 200 mph. Then he used the permit to find out exactly what the roadster, belonging to fellow team member and retired Houston businessman Neil Akkerman, would do with the throttle fully open. “It is closer to a rocket ship than a Model T Ford,” says Jones, who admits he’s been into old cars and hot rods since he was 14. After this trip, though, he said the celebratory three-olive martini never tasted so good.

-- Kristine Hughes

Bracewell's bump for more senior associates

As many other BigTex firms did this summer, Houston-based Bracewell & Giuliani announced on July 25 that as of Aug. 1 it would raise salaries for first- and second-year associates in Texas to $160,000 and $170,000 a year respectively. At that time, the firm said it was still considering what to pay its more senior associates. A week later,  Bracewell  bit the bullet, giving third- through eighth-year associates in Texas pay hikes as well, effective Aug. 1. Melanie Hillis, a spokeswoman for Bracewell, says the annual base salary for third-year associates is $172,500; $175,000 for fourth-years; $180,000 for fifth-years; $185,000 for sixth-years; $190,000 for seventh-years; and $195,000 for eighth-years. The firm has 391 lawyers nationwide and 197 associates. In Texas, the firm has 302 lawyers and 156 associates.

-- Miriam Rozen

Song and dance

The recording industry has Arthur Cookhorne and Mario Zamora, two Houston-area residents, in its sights. In two separate suits, several record companies on Aug. 21 sued Cookhorne and Zamora in U.S. District Court for the Southern District of Texas for alleged illegal downloading of sound recordings to which the record companies own copyrights. The record companies say in their complaint that the two alleged illegal downloaders obtained hundreds of songs through the Gnutella peer-to-peer (P2P) network. The suits describe P2P networks as “computer systems or processes that enable Internet users to search for files (including audio recordings) stored on other users’ computers and transfer exact copies of files from one computer to another via the Internet.” The companies allege that they caught Cookhorne and Zamora through their Internet Protocol (IP) addresses, “because the unique IP address of the computer offering the files for distribution can be captured by another user during a search or a file transfer.” The record companies say that their third-party investigator MediaSentry Inc. busted the two alleged illegal downloaders. According to the record companies, Cookhorne allegedly downloaded 203 songs illegally, while Zamora allegedly downloaded 956 songs illegally. If Zamora or Cookhorne is found liable, at minimum they should have to pay $1 a song, because that’s what I pay to download songs from iTunes. I feel like a chump, because I still pay to build my music collection. How quaint. Insert tirade about respecting private property rights here.
-- Jonathan Fox

Controversial issue is back

If you thought the complex-cases issue was dead, read on.  Proposed legislation for dealing with complex cases never made it to a vote in this year’s session of the Texas Legislature. Under the legislation, as proposed, cases determined to be complex would be assigned to state judges deemed to have special expertise in dealing with issues raised in those cases. The proposal sparked an outcry from the judiciary that some judges would be seen as being smarter than other judges.  State Sen. Robert Duncan, R-Lubbock, removed the complex-cases provision from S.B. 1204 before the bill reached the Senate floor, and Duncan’s bill later died in the House.  But the complex-case issue is back and is posted on the agenda for the Texas Supreme Court Advisory Committee’s Aug. 24-25 meeting. Jeff Boyd, a partner in Thompson & Knight in Austin who is chairman of the Legislative Mandates Subcommittee, says the subcommittee is drafting proposed rules for dealing with complex cases. The subcommittee’s assignment came from Justice Nathan Hecht, the Supreme Court’s liaison for rules, and Charles “Chip” Babcock, the advisory committee chairman and a partner in Jackson Walker in Houston. Boyd says the work on proposed rules is very preliminary at this point. Jody Hughes, the Supreme Court’s rules attorney, says the issue may be a long-term issue for the committee to explore. Hughes says the court is looking for input from a lot of people.  But it seems odd that the Supreme Court would consider doing something the Legislature declined to do.
-- Mary Alice Robbins

Bad at everything but crime

Elkie Lee Taylor is the kind of death row inmate capital punishment opponents fret about. Taylor allegedly is mentally retarded, according to his habeas corpus appeal. He scored a 75 on an IQ test when he was in school and got even lower scores when he entered prison (a person who scores 70 or lower on an IQ test is considered to be mentally retarded). His experts argue that he couldn't hold a job, got lost on buses, couldn't cook rice as a child, and when he grew up he spent a lot of his leisure time sitting in his apartment listening to his radio and talking on the phone. But the 5th U.S. Circuit Court of Appeals found one thing Taylor was good at while considering his certification of appealability --- crime. In its Aug. 21 opinion in Taylor v. Quarterman a panel found that Taylor learned from experience after murdering one person that it was easier to kill a second person with a coat hanger than with his bare hands. When a policeman questioned him about a stolen television, he allegedly thought up a lie that worked. And he also successfully maneuvered an 18-wheeler for 150 miles and then, when caught, blamed someone else for the crime. In light of that information, the 5th Circuit was not persuaded by Taylor's appeal. It just goes to show there's much more to a mental retardation analysis than a single score on an IQ test.

-- John Council

Death penalty politics

As Texas prepares to put its 400th inmate to death since capital punishment was reinstated in the United States in 1976, the European Union has asked Gov. Rick Perry to halt all upcoming executions.  The 27-nation bloc issued a statement declaring capital punishment "cruel and inhumane" and called on Perry to introduce a death penalty moratorium in the nation's busiest capital punishment state.  I'm going to go out on a limb and predict that Perry will neither halt executions nor issue a death penalty moratorium based in Texas on the EU's advice. The cultured elite in Europe must understand that Texans don't like to be told what to do, especially when it comes to something that we excel at ---  killing people. Heck, when Perry tried to save people by issuing an executive order last year requiring school-age girls to get a vaccine that prevented cervical cancer, we freaked out, called our legislators and made him stop. In other words, EU, thanks for trying to play a hand of Texas Hold 'Em. Better luck next time.

-- John Council 

Thomas at the Mark

U.S. Supreme Court Justice Clarence Thomas and his upcoming memoir “My Grandfather’s Son” will be featured at an Oct. 23 luncheon at Dallas’ Adams Mark Hotel. No word on whether the famously taciturn justice will speak at the event. The book is set for release on Oct. 1.
-- Jonathan Fox

A losing bet

Odds are not good that the Kickapoo Traditional Tribe of Texas will be able to expand gambling at its Eagle Pass reservation.  On Aug. 17, a divided 5th U.S. Circuit Court of Appeals panel ruled in Texas v. United States, et al. that the U.S. Department of Interior secretary’s 1999 Class III Gaming procedures are invalid because the procedures are in direct conflict with the Indian Gaming Regulatory Act (IGRA).  The procedures provide the Kickapoos an end run around state officials’ longstanding opposition to Class III gaming, including casino-style gambling, on Indian reservations.  The state sued the federal government and the Interior Department in 2004, seeking a declaration that the 1999 procedures are unauthorized and unconstitutional.  In 2005, U.S. District Judge Lee Yeakel of Austin held that the state’s claims regarding the procedures were not ripe for consideration.  However, Yeakel also found that the secretary of the interior has implied authority under the IGRA and his general statutory responsibility for Indian tribes to write the procedures. Chief Judge Edith Jones wrote for the 5th Circuit that the procedures “violate the unambiguous language of IGRA and congressional intent by bypassing the neutral judicial process that centrally protects the state’s role in authorizing Class III gaming.” Judge Carolyn King concurred only in the decision to reverse Yeakel’s conclusion that the interior secretary had the authority to promulgate the rules.  But Judge James L. Dennis wrote in his dissenting opinion that Congress authorized the interior secretary to write rules relating to Indian affairs and implicitly authorized the secretary to promulgate the procedures at issue in Texas’ suit to fill any gaps in the IGRA that permit a state to refuse to negotiate with a tribe in good faith while at the same time invoking its sovereign immunity to a suit by the tribe.  Texans looking to play the slots will have to continue traveling outside the state to do so.
-- Mary Alice Robbins

Waiting and waiting on Vioxx money

Carol Ernst is finding that there's a big price to pay for being the first plaintiff to win a huge Vioxx trial  against a major corporation. Two years after the widow won a $235.5 million jury verdict in the 23rd District Court in Angleton, Ernst is still waiting for the money. Ernst and her attorney W. Mark Lanier of Houston's Lanier Law Firm became the toast of the Texas litigation world after hammering Merck & Co. at trial; Ernst's husband died after using the pain medication Vioxx. But Merck has not agreed to settle with Ernst and has pursued an aggressive $1 billion strategy of litigating all of the tort suits against the company, refusing to enter into an overall settlement with Vioxx claimants. Apparently, that includes Ernst, et al. v. Merck & Co., which likely could have been settled on the appellate courthouse steps months ago for pennies on the dollar --- even after the trial judge lopped off the punitive damages award in the case, reducing the take to $26.1 million. Had Merck settled Ernst's case, it would put a benchmark price on a Vioxx suit, and that is something Merck's lawyers don't want to happen. Since her case is still on appeal, Ernst will likely keep waiting and waiting and waiting.

-- John Council

Once bitten, twice shy

The embattled Texas Youth Commission, about which multiple allegations of inmate abuse surfaced last year, seems to be taking no chances this hurricane season. Even though weather reports now indicate that Hurricane Dean may bypass Texas entirely, TYC's Web site reports today that all 194 youths from the Evins Regional Juvenile Center in Edinburg have, as a precautionary measure, been evacuated to the Ron Jackson State Juvenile Correctional Complex in Brownwood. Meanwhile, three of the Texas Department of Criminal Justice's adult facilities were evacuated, according to that agency's Web site. The TDCJ evacuated list includes: Lopez state jail in Edinburg, the Segovia unit in Edinburg and the Willacy state jail in Raymondville. In Cameron County, County Judge Carlos H. Cascos declared a state of disaster on Aug. 18, due to the pending landfall of Hurricane Dean. But so far, none of the courts in that county have been evacuated.
-- Miriam Rozen

How you going to keep ‘em down on the farm . . .

Speculation surrounding whether freshly elected Dallas County family court Judge David Hanschen will run for a seat on the 5th Court of Appeals has been put to rest. “Yeah, I’m doing it,” says Democrat Hanschen when asked about his intentions. “I plan on going up against [Justice] David Bridges.” Bridges did not return a call seeking comment.  Hanschen, who has raised the ire of several Dallas attorneys for his penchant for zealous docket management, says his skill set is well suited for the appellate bench. “I very much enjoy complex legal analysis, and that is what you get to do more so on the appellate bench,” says Hanschen who now presides over the 254th District Court. “Which is not to say that I don’t enjoy the trial bench. It has been a privilege to have some of Dallas’ top attorneys practice before me over the last eight months. It has been phenomenally educational.” Yeah, yeah. But eight months? What is it about these new Democratic judges that doesn’t keep them in their seats for very long? Craig Smith of the 192nd District Court of Dallas County told me several weeks ago that he was seriously considering a run for the Texas Supreme Court. And like Smith, Hanschen would not have to give up his district court bench. Also like Smith, Hanschen would be running for a bench from an area more heavily saturated with Republicans than Dallas County. In Smith’s case that would be the entire state of Texas; Hanschen would be running for the 5th Court of Appeals, which covers six counties, two of them the Republican strongholds of Collin and Rockwall. “I was one of the Democrats who led the charge in 2002 when we lost all but one bench,” says Hanschen. “Sometimes you have to take one for the team.”

-- Mark Donald

Cracks in the thin blue line

A police brutality suit filed Aug. 16 in the U.S. District Court for the Western District of Texas claims that an undercover El Paso police officer savagely beat a 76-year-old retired El Paso police detective who asked the undercover cop for identification. The suit alleges that it all began around 9 p.m. on June 22, 2006, when a neighbor called Charles Roger Krieger, a retired detective who lived alone with several pets, to tell him a suspicious vehicle was parked on his property. Krieger went outside to investigate. El Paso police officer Joshua Cass was in the car, “ostensibly staking out one of Mr. Krieger’s neighbors,” the suit alleges. Krieger, the suit says, approached Cass and asked him what he was doing there. According to the suit, Cass replied, “It’s none of your business, just get away from my car!” Krieger, who did not know Cass was a police officer, then asked Cass for identification. Instead, Cass pulled out his gun and pointed it at Krieger’s head and stated, “Police!,” the suit alleges. When Krieger told Cass that he also had a gun, the suit alleges that Cass “savagely beat and attacked Mr. Krieger, kicking and punching him on the ground,” even after handcuffing him. Krieger lived through the incident, the suit says, even though he suffers from Parkinson’s disease, Raynaud’s disease, congestive heart failure and other ailments. After the incident, the suit says, Krieger filed complaints against Cass with the El Paso police department’s internal affairs division and the FBI. But Cass, the suit alleges, then initiated “false criminal charges against [Krieger] for ‘making a terroristic threat.’ ” The charges resulted in a warrant against Krieger, who turned himself in to jail — but not before releasing his pets into the wild, believing, according to the suit, that he would not be let out of jail for months. A judge, however, released Krieger on a personal recognizance bond. Krieger is suing the city of El Paso and Cass under 42 U.S.C. §1983, claiming violation of his civil rights.
-- Jonathan Fox

Heading for the homestead

Three days after Karl Rove, deputy chief of staff at the White House, announced he will resign at the end of August, an attorney filed a suit in the 53rd District Court in Travis County, alleging that she was fired from the Texas Office of the Secretary of State for making comments to a reporter that embarrassed Rove and other Republicans. Elizabeth Reyes filed Reyes v. Williams, et al. on Aug. 16. In her original petition, Reyes contends that the alleged reason for her termination in September 2005 was violating the Office of the Secretary of State’s policy and procedures manual on press calls when she spoke to a Washington Post reporter about the homestead exemption in Texas. But Reyes alleges that she was fired because the statements attributed to her in the Post article — concerning Rove’s claim of a homestead exemption on rental cottages he owns in Kerr County, although Rove was living in Washington, D.C., at the time — caused political embarrassment for defendants Roger Williams, the former secretary of state, and H.S. “Buddy” Garcia, the former deputy secretary of state. Among other things, Reyes alleges that Williams and Garcia violated her rights to free speech and association under the First and 14th Amendments. Reyes also names Phil Wilson, the current secretary of state, as a defendant in the suit. In addition to seeking damages against Williams and Garcia, Reyes seeks an injunction to require Wilson to purge any references to the termination from her employment record at the secretary of state’s office.
-- Mary Alice Robbins

Safety first

The Potter County Commissioners Court has taken the first step toward improving security in the county’s courthouse and nearby courts building. The two buildings, which house the 7th Court of Appeals, county and district courts, and other county offices, currently have minimal security. No one checks to see if visitors entering either building are carrying weapons. But after hearing from representatives of the Amarillo Area Bar Association and 7th Court Chief Justice Brian Quinn on Aug. 13, the commissioners court voted to include $100,000 in general revenue funds for security in the county’s budget for fiscal year 2008. County Auditor Kerry Hood says the commissioners court also agreed to look at using about $75,000 in courthouse security funds once a security plan is formulated. The county could get some help with the funding. Quinn says the 7th Court has identified about $5,500 in its budget that could be used to purchase two metal detectors for the courts building. As Hood notes, the commissioners court is a whole lot closer to beefing up security for the courthouse and courts building than it has been in the past. I say give the commissioners court a collective pat on the back.
-- Mary Alice Robbins

Fasten seat belts; turbulence ahead

A giant of the air is taking on a giant of the Web. American Airlines alleges that search-engine giant Google is infringing on its trademarks by selling advertising to third parties — known as “sponsored links” — that appears when Internet users type in the name American Airlines or another one of AA’s trademarks into the Google search engine. The suit, American Airlines Inc. v. Google Inc., was filed on Aug. 16 in U.S. District Court for the Northern District of Texas. The suit, which alleges copyright infringement and other claims, seeks damages in the yet-to-be determined amount of “all gains, profits, savings and advantages obtained by Google as a result of its wrongful actions.” “[I]nstead of being directed to American Airlines’ website,” the suit alleges, “Google’s ‘sponsored links’ may instead misdirect [search-engine users] to: (i) websites of airlines that compete with American Airlines; (ii) websites that sell air travel not only on American Airlines, but also on a variety of airlines that compete with American Airlines; or (iii) websites that are entirely unrelated to air travel.” AA says Google’s paid links piggyback on AA’s reputation and goodwill. “Google’s infringement of the American Airlines Marks is willful and reflects Google’s intent to exploit the goodwill and strong brand recognition associated with the American Airlines Marks,” the suit alleges.
-- Jonathan Fox

From adviser to candidate

Dallas trial lawyer Ken Molberg, a member of the State Democratic Executive Committee, often has recruited Democrats to run for judicial posts in the past. But Molberg, a partner in Wilson Williams & Molberg, has decided that 2008 will be his year to make a run for a Dallas court. On Aug. 15, Molberg filed his appointment of a campaign treasurer in his bid for the 95th District Court bench, where Republican Judge Karen Johnson currently sits. In his filing with the Texas Ethics Commission, Molberg named as his campaign treasurer Dallas resident David W. Bradley. For those interested in trivia, Molberg is seeking a post that some well-known jurists once held. U.S. District Judge A. Joe Fish of the Northern District, Dallas Division, and Texas Supreme Court Justice Nathan Hecht both sat on the 95th District Court in the 1980s.
-- Mary Alice Robbins

Sonnenschein down to two in Dallas

Chicago-based Sonnenschein Nath & Rosenthal has big plans for Dallas. And Matt Yarbrough was part of those plans. Yarbrough, a former assistant U.S. attorney and former partner in the Dallas office of Fish & Richardson, was Sonnenschein’s first hire in its new Dallas office in February. But two weeks ago, Yarbrough left the firm, says Matt Orwig, managing partner of Sonnenschein’s Dallas office. “The bad news is that it didn’t work out. The good news is that we all recognized it quickly and made the appropriate adjustments,” Orwig says. “I certainly wish Mr. Yarbrough the best.’’ Yarbrough did not return a call for comment. Sonnenschein has 700 lawyers firmwide, two of those in Dallas. The firm plans to use Dallas as a base for intellectual property and patent litigaion work. Orwig says the firm will start adding more lawyers to its fledgling Dallas office in early 2008.

-- John Council

Courthouse restoration

Calling all Texas counties interested in restoring historic courthouses. There’s more state money available for restoration projects. The Texas Historical Commission is seeking applications from counties that would like a share of a $62 million appropriation from the Texas Legislature. Applications for Round V of the THC’s Texas Historic Courthouse Preservation Program are due by Nov. 19 and awards will be announced in January 2008. The preservation program provides partial matching grants to Texas counties for historic courthouse restoration projects. Since the program began in 1999, the state has provided $145 million in grant funds, and local governments have matched that money with more than $62 million. So far, the Texas Historic Courthouse Preservation Program has helped pay for restoration of 37 courthouses. Texas Lawyer has written about many of the historic courthouses in a series titled “This Old Courthouse.” 

-- Brenda Sapino Jeffreys

A one-of-a-kind Lubbock lawyer

Madison Sowder, Lubbock County Democratic Party chairman during the 1970s and early 1980s, died on Aug. 13 at the age of 80.  Sowder taught many up-and-coming politicians the ropes but had little luck in winning political office himself.  In 1986, then-Gov. Mark White appointed Sowder to fill a vacancy on the 137th District Court in Lubbock, but Sowder subsequently lost his bid for election to the bench.  In 2005, Sowder celebrated 50 years of partnership with Dan M. Hurley.  The two were partners in Lubbock’s Hurley & Sowder. A bear of a man, Sowder always had a cigar clamped between his teeth and a joke on his lips.  He was one of a kind.
-- Mary Alice Robbins

Taking it to the streets

When Craig Watkins was elected Dallas County district attorney in 2006, he promised to be smarter about prosecuting crime. And now he's taking that promise to the streets. Today, Watkins is holding a press conference in South Dallas --- a crime-ridden part of the city --- to plead with citizens to help solve a suspected gang-related shooting that left one person dead and three people injured on Aug. 12.  Watkins wants to convince anyone who may have seen the shooting to step forward and cooperate with law enforcement, rejecting the "anti-snitching" attitude that often makes it difficult to solve crime. He's speaking in front of a cafe on Martin Luther King Jr. Boulevard where the shooting occurred. Watkins has some credibility on this particular stretch of road. He officed out of a building on MLK --- just blocks away from where the shooting occurred --- when he was a criminal-defense solo. 

--- John Council

Rethinking rebranding

I count myself a fan of the current craze of rebranding the names of law firms in Texas. I love seeing which firm has changed from a five-lawyer name to a one-lawyer name. And I giggle thinking about the management committee meeting that must occur when the partners decide which person becomes the 150-lawyer firm's sole namesake. Do the lawyers draw straws or guns to make such a decision? Now I'm awaiting the rebranding trend that is certain to happen -- using a lawyer's first name as a firm's trademark. Which firm will be the first to call itself simply "Chuck." Think about it: Using a first name to brand a firm is less formal; it's familiar, friendly and a sure-fire way draw in clients. Right now, some client is probably thinking: "You know, this is a bet-the-company case we have here. We really need Chuck."

-- John Council

It’s all about the Benjamins . . . um, Jacksons

Jackson Walker joined the club this week, telling associates in a memo on Aug. 14 that the compensation committee will increase the salary and bonus packages for first-year associates to $160,000. But, unlike other Texas-based firms, Jackson Walker’s raises are not effective until Jan. 1, 2008. According to Michelle Steckel, a spokeswoman at the 315-lawyer Dallas-based firm, first-year associates will receive $140,000 in base salary and $20,000 in guaranteed bonus. The first-years will receive $15,000 of that bonus immediately upon arrival at the firm, Steckel says, but she cannot yet clarify whether associates joining the firm in the fall of 2007 will receive the sign-on bonuses. Jackson Walker has six Texas offices and 99 associates. The compensation committee told associates that this fall management also plans to announce increases in salaries for second- through eighth-year associates. All the salary increases will be effective Jan. 1, 2008, but the compensation committee said the new salary structure will be a factor in 2007 year-end bonuses. The memo said management is still "studying changes in the compensation structure." The committee told associates, "We intend to remain competitive but will be careful to do so in a way that does not compromise our culture or the best interests of our clients." Jackson Walker's move follows those of many other Texas-based firms handing out money to associates since Houston-based Vinson & Elkins announced a new salary schedule in mid-July. Most of them have matched V&E’s $160,000 first-year rate, and in some cases the $170,000 second-year salary, but a number of firms, like Jackson Walker, are still studying how they will compensate upper-level associates.
-- Miriam Rozen

Real estate maven

Susan Mead, a real estate partner in Jackson Walker, made headlines in The New York Times — not because of a client but because of her own property holdings. An article and photo spread in the real estate section of the newspaper featured her five homes, including a Dallas apartment, "a 3,500-square-foot rental in Akumal, Mexico, on the Caribbean Mayan Coast; a tiny whaler’s cottage in Sag Harbor, New York; a multilevel beauty overlooking San Miguel de Allende in central Mexico and a Pacific Ocean cliff-house in the fishing town of Puerto Angel, Mexico." In the story, Mead discussed at length her lifelong avocation: renovating houses. The bathroom in the San Miguel house is particularly lovely.
-- Miriam Rozen

Lightweight champ wants one more title: lawyer

World champion boxer Juan Díaz wants to float like a butterfly and sting like a bee — in the courtroom. Díaz is a pre-law major at the University of Houston-Downtown. “I want to become an attorney for people who don’t always have a voice,” he says in a press release. “I have been given so much by my parents, my trainer, the community and now UHD, I feel this is a way I can give something back to the community.” Díaz has been the lightweight champion for the World Boxing Association since July 17, 2004. He is the first in his family to attend college.
-- Jonathan Fox

 

Good news for Gardere first-years

Dallas-based Gardere Wynne Sewell today became the latest large Texas-based firm to give a healthy raise to its first-year lawyers. Effective Sept. 1, the firm will increase the base salary for first-year associates to the new Texas market rate of $160,000. “We’re trying to be competitive with the market,” says Stephen Good, managing partner of the 282-lawyer firm. The firm is working on a new compensation plan for other associates and expects to have details in place by the end of September. In an e-mail sent to associates today, Good wrote, “Compensation in subsequent years will be adjusted based on each associate’s individual performance and professional development, which will be measured against specific standards that have been developed and will be finalized over the next few weeks.” There is no bonus associated with the $160,000 first-year salary, Good says. The firm has 113 associates. Gardere isn’t the only Texas firm handing out money to associates. A number of large Texas firms raised associate compensation in the weeks since Houston-based Vinson & Elkins announced a new salary schedule in mid-July. Like Gardere, several firms matched V&E’s $160,000 first-year rate, and in some cases the $170,000 second-year salary, but a number of the firms are currently studying how they will compensate upper-level associates.

-- Brenda Sapino Jeffreys

If it sounds too good to be true . . .

The Securities and Exchange Commission says a Texas man squandered $14.5 million raised from 900 U.S. and international investors through the allegedly fraudulent sale of unregistered securities. In SEC v. Inter Global Technologies Inc. and Michael E. Tomayko, filed on Aug. 13 in the U.S. District Court for the Northern District of Texas, the SEC says Inter Global Technologies (IGT) Inc. and its founder Michael E. Tomayko of Irving claimed “access” to licenses to build oil refineries in Indonesia, promising investors “immense wealth” once IGT procured the $15 billion necessary to build the refineries. Tomayko told investors that funding would come from “a number of sources: a financial windfall from letters of credit or other bank instruments provided by a wealthy contact in Indonesia; a vault filled with gold bullion and guarded by tribal elders; and the largess of the Saudi royal family.” But the financing never materialized; instead, the SEC alleges Tomayko frittered away the $14.5 million to support his “lavish international lifestyle” as he fruitlessly chased financing in Indonesia. Tomayko never obtained any third-party verification that his licenses had any value, the SEC alleges. Nonetheless, the SEC says, he represented to investors that the licenses would yield incredible wealth.
-- Jonathan Fox

Best law firms for women

A new list released today, the 2007 Working Mother & Flex-Time Lawyers Best Law Firms for Women, identifies 50 firms in the United States that provide notable work-life and women-friendly policies. The firms on the list, compiled by Working Mother magazine and consulting firm Flex-Time Lawyers, are a who's who of big national and regional firms. Sadly, not a single Texas-based firm made the list, although a number of firms with Texas offices are on the list, such as Washington, D.C.-based firms Patton Boggs and Howrey; Chicago’s Mayer, Brown, Rowe & Maw; Atlanta-based King & Spalding; and Pillsbury Winthrop Shaw Pittman of New York. Deborah Epstein Henry, founder and president of Philadelphia-based Flex-Time Lawyers, says she can’t say if any Texas firms sought to be included on the inaugural list, but she invited Texas-based firms to apply for the 2008 list.  The firms on the list, all with at least 50 lawyers, have policies in place that help women in the workplace, such as flex-time, child care, women-focused mentoring and leadership and networking programs. The winners were selected based on their responses to an application measuring six areas: work force profile, benefits and compensation, parental leave, child care, flexibility and retention and advancement of women. Henry says her goal in partnering with Working Mother magazine was to spur firms to compete on work-life and women's issues, just as they compete on associate salaries. “What are the pressure points to effect change? This is certainly one of them, creating competition in an industry that’s super-competitive,” Henry says. She says it’s not coincidental that the list was made public immediately before firms and other employers start fall on-campus interviews at law schools. She hopes women law students will use the list when they decide where to work after graduation. That’s something Texas-based firms should think about. The full list is in the August/September issue of Working Mother and on the Working Mother and Flex-Time Lawyers Web sites.

-- Brenda Sapino Jeffreys

Fallen star

Texas Monthly named Austin bankruptcy attorney Douglas Michael Stum among the “Rising Stars” in 2005.  On Monday, U.S. District Judge Lee Yeakel sentenced Stum to 10 years in prison for possession of materials involving the sexual exploitation of a minor.  Yeakel also ordered Stum to register as a sex offender and to be placed on 10 years of supervised release after his prison term. Matthew Devlin, the assistant U.S. attorney who prosecuted Stum, says Stum had more than 1,000 images of child pornography on his home computers. 
-- Mary Alice Robbins

Nigerian scammers pose as Dallas lawyer

Shortly after the death of client Ken Lay in July 2006, Dallas civil litigator James E. Coleman Jr. received a curious telephone call from a woman from Fort Worth. She said she was responding to Coleman’s e-mail seeking her assistance with getting more that $3 million out of a bank in England; the money allegedly belonged to a gentleman from England and former Enron Corp. Chairman Lay. The deal, as described in the e-mail, offered the woman a share of the money, Coleman says. Even though the 84-year-old Coleman isn’t a big user of e-mail and he doesn’t consider himself Internet savvy, he deduced right away that the woman had received a version of an e-mail fraud known as the Nigerian Scam. “It was exactly a Nigerian Scam. I immediately called the FBI,” Coleman says. Urban legend Web site Snopes.com describes the Nigerian Scam as a fraudulent business deal in which the victim advances money or fees, often to help a wealthy foreigner obtain money in a bank, and never gets a return. Coleman didn’t keep a copy of the bogus e-mail sent out under his name, but he says he told everyone who called that it’s preposterous that he would be involved in such a clearly fraudulent deal. Over the course of several weeks last fall, Coleman says, he got several calls from people expressing interest in participating in the deal and a few from people alerting him to it and the use of his name. “I got a call from Tennessee, a call from someone in California, someone in upstate New York, somebody in Alabama [and] Arkansas who knew all about this,” Coleman recalls. “I just had a standard answer to this: It’s a fraud, and I don’t know anything about it.” The callers asked to speak with him directly, he says, because the e-mail warned recipients that his firm didn’t know about the deal, and they needed to keep it hush-hush. To add to the mess, Coleman says, the letter wasn’t even well-written. “I told some of the people the literacy of the letter was not very good, and I was very offended by that, because I write a much better letter.” Coleman says the woman who called him from Tennessee told him she played along  for a while, for curiosity’s sake, until the alleged scammers asked her for a credit card number and her bank account information. Coleman says he’s heard nothing from the FBI since he reported it last fall and doesn’t really expect to find out if anyone was prosecuted. However, he says he hasn’t received a single call about it since in 2007. As a precaution, though, Coleman’s firm, Dallas-based Carrington, Coleman, Sloman & Blumenthal, has a special advisory on its Web site.
-- Brenda Sapino Jeffreys

Ready for the bust

Vinson & Elkins is building a stockpile of bankruptcy lawyers for the inevitable turn of the business cycle, when litigation and bankruptcy work will ascend and transactional work will decline. “We still haven’t legislated away market cycles, and timing is anyone’s best guess, but there’s a degree of inevitability of the ups and downs of the eco