ABA Section of Business Law

Snap judgments

On second thought

It’s time for firms across the country to pay the piper. But they’re dishing out dollars to their new hires, not to the dot-com-industry Pied Pipers who lured associates off to Silicon Valley, causing starting salaries to skyrocket, the New York Times Reports.

In an effort to stymie the record turnover at San Francisco firms as new associates left to find gold in the hills of Silicon Valley, the Times reports, firms upped starting salaries.

Of course, salaries couldn’t just climb in Bay Area offices, so firms had to increase pay in all their offices nationwide. By last spring, the Times reports, first-year associate pay at big-name firms nationally hit $125,000 plus bonus money that can top $15,000.

But with the April Morgan Stanley Internet index tumble, the new economy job offers dried up. The law firms, it seems, won the bidding war but still came out the losers because they now must pay a higher price for the same staff they would have had in the first place at a lower salary if they never got caught up in the game.

Warp speed for business

Forget the backlog in criminal cases; and don’t worry about the mess in juvenile courts; just make sure the needs of business are met! While that motto hasn’t yet been inscribed on the Commonwealth of Massachusetts’ seal, the Boston Globe reports that that’s the order of the day in Suffolk Superior Court.

According to the Globe, Massachusetts’ business types’ years of lobbying the court paid off last fall when a courtroom and judge were designated for the sole purpose of adjudicating commercial cases. Business leaders, the Globe reports, found delays in civil decisions by the Superior Court were hurting business and forcing many to abandon the court system entirely, enlisting mediation services and precluding the establishment of legal precedents.

"In high tech, we’re operating at warp speed, and we have had cases over the years where we need rapid resolution," EMC Corp. Senior Vice President and General Counsel Paul T. Dacier told the Globe.

Privacy? What privacy?

Although no one has started calling it e-rony, life in the dot-com world has been taking enough ironic twists and turns lately that Tim Robbins unfortunately may feel compelled to star in another high-tech thriller.

While the latest turn of events isn’t enough to warrant a soundtrack featuring Everclear, it is making lawyers, dot-comers and consumers take notice.

According to the New York Times, many failing e-tailers in the throes of hasty going-out-of-business sales have put their consumer databases on the market to earn quick cash to pay off creditors. The only catch is that when starting out, these companies — in an effort to drum up business by allaying consumers’ privacy concerns — promised that consumer data would not be sold. So, not only did these privacy pledges fail to bring in enough business initially to keep the companies afloat, but they’re now hampering income even as the online companies prepare to fold.

Already, the Times reports, companies like ToySmart.com have gone to court to win the right to sell their databases. Thus far, however, no final decision has been made on how to handle the competing business and consumer interests — leaving the players and viewers of this high-tech drama once again on the edge of their seats.

Once upon a dimpled chad

Amid the nonstop news coverage of dimpled chads and butterfly ballots, it’s hard to imagine that anyone in Florida missed his or her 15 minutes of fame. But, according to the Court Reporters News Bureau, the 24-hour news channels ended up missing a story.

In a release, the News Bureau reported that Tallahassee, Fla., court reporter BJ Quinn had used new Realtime technology to convert her stenographic court transcripts into usable copies for the media to devour. Realtime capabilities, according to the News Bureau, also allowed the text to be displayed on computer monitors throughout the courtroom.

"During the election contest hearings before Judge Sanders Sauls," Quinn said, "we were on the record for 23 of 35 hours, beginning at 8:30 a.m. on Saturday and ending 11:30 p.m. on Sunday. We created more than 750 pages of transcripts, which were in the file for Monday morning."

Of course former Vice President Al Gore may have been more interested if not only had he invented Realtime capabilities, but if Realtime were also able to yield 750 Democratic votes for him during those critical 35 hours.

About those Net stock tips

It remains to be seen if it’s crime that paid in the case of a New Jersey teen allowed to hold onto a portion of the profits he made through online trading while the Securities and Exchange Commission tries to define the difference between online bragging and outright fraud, according to U.S. News & World Report.

The SEC made online wunderkind Jonathan G. Lebed, now 16, repay $272,826 plus interest to make up for what they consider the illegal profits he made two years ago on the stock market by purchasing stock and then posting false Internet messages touting the stock, U.S. News reports.

The SEC said it was the first time it brought charges against a minor.

Despite the hefty payback, the feds decided to let Lebed hold onto $500,000 he made from 16 additional trades that involved Internet bragging, but not flatout lying.

"There’s a fine line between behavior the SEC elects to prosecute as fraud and what it chooses to tolerate as business as usual," said Kevin Marino, Lebed’s lawyer.

A month just for disputes

President George W. Bush may have declared the day after his inauguration a National Day of Prayer, but even the leader of the free world may have to wait until October for Dispute Settlement Month.

We’re not making this up. The NASD Dispute Resolution Inc., according to the Boston Globe , has set up a program through which slighted investors can try to right their perceived wrongs through mediation at special Dispute Settlement Month rates.

NASD’s Kenneth Andrichik tells the Globe that through the arbitration process his firm offers, 80 percent of cases end in settlement. To help get the ball rolling last October, NASD waived filing fees for cases with claims less than $25,000 and charged $100 for a four-hour mediation session for claims in the less-than-$25,000 category.

If only President Clinton had known about this service, he may have squeaked out of his own investment scandal with a little less publicity.

—Heather Brewer

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