LegalNewsLine.com

Palin to resign as Alaska governor

Chris Rizo (csrizo@hotmail.com) — Fri, 03 Jul 2009 16:56:00 CST

WASILLA, Alaska (Legal Newsline)-Alaska Gov. Sarah Palin, the 2008 Republican vice presidential nominee, announced Friday she will step down in a matter of weeks.

In a surprise announcement at a press conference in her hometown of Wasilla, the 45-year-old Palin said she will leave the governor's office July 26, a move that has spurred speculation the first-term governor plans to focus on a presidential race in 2012.

"Once I decided not to run for re-election, I also felt that to embrace the conventional Lame Duck status in this particular climate would just be another dose of politics as usual, something I campaigned against and will always oppose," Palin said in a statement.

Palin was elected governor of Alaska in November 2006, becoming the first woman and the youngest person to hold the job. She defeated incumbent Gov. Frank Murkowski in the Republican primary in 2006.

After Palin's resignation becomes effective on July 26, Lt. Gov. Sean Parnell will be inaugurated at the governor's picnic in Fairbanks, Alaska.

Palin was Arizona Sen. John McCain's vice presidential running mate last year. She was undoubtedly the most polarizing figure in the 2008 presidential race.

While she enjoyed unwavering support among most conservatives on the presidential campaign trail, she drew nearly constant criticism from Democrats and many non-affiliated voters.

By leaving public office, Palin is free accumulate resources for a national race. She could go on to cash in on her popularity among conservatives by doing speaking engagements and making appearances for profit, which she would have been barred from doing as governor.

At her announcement, Palin, who is in the last year of her first term as governor, said she and her husband Todd plan to return to private life.

"We are not retreating, we are advancing in a different direction," Palin said. "We know we can effect positive change outside government at this moment in time."

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

Republican announces run for Illinois AG

Chris Rizo (csrizo@hotmail.com) — Fri, 03 Jul 2009 02:17:00 CST

SPRINGFIELD, Ill. (Legal Newsline)-The first Republican has thrown his hat into the 2010 race for Illinois attorney general.

DuPage County State's Attorney Joseph Birkett, who had considered a run for governor, announced his candidacy for the state's chief legal officer Thursday.

This will be Birkett's third bid for statewide office in the Land of Lincoln.

In 2002, he lost the attorney general's race to Democrat Lisa Madiagn, who currently holds the post. Four years later, he ran for lieutenant governor on the Republican ticket with gubernatorial candidate Judy Baar Topinka.

In the Nov. 5, 2002, general election, Madigan won 50.4 percent of the statewide vote, making the Chicagoan the state's first female attorney general. In 2006, she was handily reelected with 72.4 percent of the vote against Tazewell County State's Attorney Stewart "Stu" Umholtz.

Madigan, who is widely considered a heavyweight in Democratic politics, has yet to declare whether she will seek reelection as attorney general or run for another office, such as U.S. Senate or governor.

Announcing his run for AG, Birkett, 54, said serving as attorney general would be a better fit for him than governor.

"I've spent the last several months traveling around the state, talking to people about a possible run for governor. But I've decided that I want to remain a prosecutor," he said in a video on his campaign Web site.

Birkett has been DuPage County state's attorney since 1996.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

Five lead plaintiffs named in Bank of America class action

Nick Rees — Fri, 03 Jul 2009 02:10:00 CST

COLUMBUS, Ohio (Legal Newsline) - Five pension funds in a securities class action lawsuit on behalf of investors in Bank of America over untrue statements and failure to disclose information about its Merrill Lynch acquisition were granted lead plaintiff status.

Three American public pension funds -- the State Teachers Retirement System of Ohio, the Ohio Public Employees Retirement System, the Teacher Retirement System of Texas -- and two European pension funds -- Fj�rde AP-Fonden and Stichting Pensionfonds Zorg en Welzijn -- were named lead plaintiffs.

The lawsuit alleges that Bank of America made materially untrue statements and failed to disclose material information in connection with its acquisition of Merrill Lynch.

"Our group of public pension funds has been given both a great opportunity and a great responsibility," Ohio Attorney General Richard Cordray said."We now will protect the rights of Bank of America investors, including those of the five funds that will serve as Lead Plaintiff and the public employees and teachers who depend on them in this extraordinarily important case."

The pension funds, as lead plaintiff, are responsible for protecting the interests of all similarly situated Bank of America Investors, which are made up of individual and institutional investors. The group is, in effect, empowered to purse litigation that is in the best interests of all members of the investing public that were harmed by the alleged historic misconduct of the defendant.

"We feel privileged to represent global investors' interests by striving for adequate loss recovery for all shareholders and essential corporate governance reforms," Johan van der Ende, chief investment officer of PGGM Investments, said.

The five pension funds were noted by Judge Denny Chin of the U.S. District Court for the Southern District of New York as having the largest financial interest in the case. He also noted that the five are "the type of sophisticated institutional investors envisioned by Congress" to serve as lead plaintiffs.

Hollywood opens checkbooks for Calif. AG hopeful Kamala Harris

Chris Rizo (csrizo@hotmail.com) — Fri, 03 Jul 2009 02:00:00 CST

SAN FRANCISCO (Legal Newsline)-California attorney general candidate San Francisco District Attorney Kamala Harris has attracted the support of a handful of Hollywood heavyweights.

The Los Angeles Times reported Friday that the Democrat has had fundraisers in Tinsel Town as she prepares to go up against a crowded field of candidates for the Democratic AG nomination.

The newspaper reported that on Tuesday, authors Lisa Jones Johnson and Jarone Johnson, along with actor-businessman Brent Bolthouse, director Brett Ratner, and actor Eric Dane hosted a cocktail party for guests who paid as much as $5,000 to meet Harris.

And, more than a week ago, Harris was the guest of honor at a luncheon hosted by former studio head Sherry Lansing.

Harris, 44, began attracting attention in Hollywood when she was an early supporter of Barack Obama as he was battling then-Sen. Hillary Clinton, D-N.Y., for their party's presidential nomination.

"If we learned one thing from Hollywood's early and active support of Barack Obama it's that the entertainment community has an eye for new leadership and innovative ideas," Harris' campaign manager Brian Brokaw was quoted by the Times as saying. "Kamala Harris' 'smart on crime' approach as district attorney has produced incredible results in San Francisco, resulting in the highest conviction rates in nearly 15 years while also striving to prevent crime before it happens."

Also seeking the Democratic nomination for attorney general is: state Assemblymen Ted Lieu of Torrance and Pedro Nava of Santa Barbara, Assembly Majority Leader Alberto Torrico of Newark, Los Angeles City Attorney Rocky Delgadillo and Chris Kelly, chief privacy officer for the Web site Facebook.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

Federal appeals court judge rebuked over his explicit Internet files

Chris Rizo (csrizo@hotmail.com) — Fri, 03 Jul 2009 02:00:00 CST

WASHINGTON (Legal Newsline)-A panel of federal judges has admonished Alex Kozinski, chief judge of the U.S. 9th Circuit Court of Appeals, for placing sexually explicit photos and videos on an Internet server that could be accessed by the public.

Kozinski, 58, called for the formal investigation amid public controversy over the material.

The panel said they found that Kozinski's "possession of sexually explicit offensive material combined with his carelessness in failing to safeguard his sphere of privacy was judicially imprudent."

In the opinion written by Anthony Scirica, chief judge of the U.S. 3rd Circuit Court of Appeals, the judges also said Kozinski's actions "can reasonably be seen as having resulted in embarrassment to the institution of the federal judiciary."

Kozinski has apologized for his carelessness in posting the material to the server that was accessible by the public.

"I have caused embarrassment to the federal judiciary," he told the panel. "And thus whatever shame was cast on me personally, it reflected on my colleagues and our system of justice as well."

Kozinski was presiding over a closely watched obscenity trial in Los Angeles in June 2008 when the Los Angeles Times reported the judge's Web site contained lewd materials.

In a statement Thursday, Kozinski said the judges' opinion affirmed that the materials on the Internet server were intended to be private.

"Our 9th Circuit Court of Appeals has much important work to do, and I look forward to continuing to work with my colleagues to accomplish our goals," Kozinski said.

On the panel were 3rd Circuit Judges Marjorie Rendell and Walter Stapleton; U.S. District Chief Judge Harvey Bartle III of the Eastern District of Pennsylvania and Chief Judge Garrett Brown of the District of New Jersey.

Kozinski was appointed to the San Francisco-based appeals court by President Ronald Reagan in 1985. He is considered by many legal observers a judicial conservative on most issues.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

States join FTC in targeting business opportunity fraud

Ashley Stinnett — Fri, 03 Jul 2009 01:05:00 CST

TALAHASSEE, Fla. (Legal Newsline)- The Federal Trade Commission and an alliance of 15 state law enforcement authorities are teaming up to combat debt relief scams, Florida Attorney General Bill McCollum said.

McCollum said the operation will focus on targeting a variety of fraudulent practices, including bogus employment opportunities, fraudulent business ventures, falsified government grants and phony debt reduction services.

The operation has already led to a settlement with MagicJack over allegations the company marketed a "free" 30-day trial for its long distance phone equipment, but actually charged customers during the offer.

Family Credit Counseling Corp, a Ft. Lauderdale, Fla.-based debt relief service, was among other agencies settling with the states. That company allegedly misappropriated debt management programs, along with, debt reduction malpractice.

"As our state and our citizens face tough economic times, some individuals are taking advantage of the situation by preying on the vulnerability of others, making circumstances more difficult," McCollum said. "This operation will help create a necessary deterrent so these unscrupulous people stay out of our state."

The program, known as Operation Short Change, is comprised of 14 states, the District of Columbia.

In addition to Florida, states participating in the operation are California, Illinois, Kentucky, Iowa, Louisiana, Missouri, Nebraska, North Carolina, North Dakota, Ohio, Pennsylvania, Wisconsin and Texas.

State AGs reach tentative agreement with General Motors

Chris Rizo (csrizo@hotmail.com) — Thu, 02 Jul 2009 14:39:00 CST

LINCOLN, Neb. (Legal Newsline)-Thirty states have reached a tentative agreement with General Motors Corp. over concerns the troubled automaker's bankruptcy plan would trample state laws, Nebraska Attorney General Jon Bruning announced Thursday.

Bruning, who led the attorneys general in their opposition to the plan, said other states are expected to sign on to the agreement.

"We are pleased GM was willing to work with states to resolve our concerns so that consumers, dealers and the environment will continue to receive the protection of state law," said Bruning, a Republican and president of the National Association of Attorneys General.

Bruning, in an interview with Legal Newsline, said GM's bankruptcy plan would have forced current dealers to sign new agreements that would leave them with no state protections.

The Chapter 11 plan would have also disproportionately affect rural markets because some motorists would be forced to drive hundreds of miles to have their GM model serviced by a dealership.

Under the Bruning-led agreement, General Motors has agreed to acknowledge that all dealers staying with the new GM will be protected by state franchise and dealer laws and honor its express warranties and comply with state lemon laws, among other things.

"I'm confident the concessions given to the states, while of great benefit, won't interfere with the ability of new GM to function as a viable company nor should they add to the burden placed on taxpayers by the (U.S.) Treasury's purchase of GM," Bruning said Thursday.

Attorneys General Richard Blumenthal of Connecticut, Greg Abbott of Texas, Richard Cordray of Ohio and John Suthers of Colorado were on the executive negotiating committee representing the 30 states.

Bruning urged his fellow attorneys general to join him in formally opposing the company's original restructuring plan. The chief legal officers from 36 states followed suit and filed their objections with the U.S. Bankruptcy Court for the Southern District of New York.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

Miss. jury awards $7M in lead paint case

John O'Brien (john@legalnewsline.com) — Thu, 02 Jul 2009 13:52:00 CST

FAYETTE, Miss. (Legal Newsline) - A Jefferson County, Miss., jury has awarded $7 million to the plaintiffs in a lead paint suit against Sherwin-Williams Co.

It was a rare loss for the paint industry, which has collected victories in Rhode Island, Missouri, Wisconsin and New Jersey. The Jefferson County plaintiff was a high school-age boy who ate lead paint chips.

According to a report by The Associated Press, Sherwin-Williams plans to appeal the verdict. It also quotes a company spokesman who says Sherwin-Williams hasn't used lead in residential paint since 1972.

Attorney Chuck Moellenberg told Legal Newsline in 2007 that the plaintiff, Trellvioin Gaines, alleged he had elevated blood-lead levels when he was 2. At the time, Gaines was on his high school's varsity football and basketball teams, though he was "someone who is not going to be a star academically," Moellenberg said.

Sherwin-Williams won summary judgment years ago, but the state Supreme Court overturned the decision and reinstated the case.

Lead paint was outlawed in 1978, and some states, municipalities and counties have alleged companies created a public nuisance by ever manufacturing it.

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

Pa. SC will rule on Gov. Rendell's contract with plaintiffs firm

John O'Brien (john@legalnewsline.com) — Thu, 02 Jul 2009 13:20:00 CST

HARRISBURG, Pa. (Legal Newsline) - The Pennsylvania Supreme Court has agreed to hear the appeal of a pharmaceuticals company that says a major plaintiffs firm hired by Gov. Ed Rendell should not be allowed to sue it.

The Court decided to accept the appeal on Tuesday and will receive briefs on four issues raised by Janssen Pharmaceutica, the docket sheet says. Rendell hired Bailey Perrin Bailey of Houston to file suit against Janssen over its alleged off-label marketing of a prescription drug.

The Court will rule on:

-Whether Janssen lacks standing to seek the disqualification of BPB on the basis of alleged violations of constitutional law;

-Whether Rendell's office is allowed to enter into a contingent fee agreement with BPB;

-Whether BPB should be disqualified because the General Assembly did not authorize the contingent fee contract; and

-Whether BPB should be disqualified because it has a direct financial interest in the outcome of the litigation.

After setting up a meeting between Republican Attorney General Tom Corbett and BPB, Rendell decided to hire BPB himself.

Corbett was not impressed with BPB's evidence at the meeting and declined to have his office file the suit. Rendell hired BPB to represent the state, but has received criticism because the firm contributed $75,000 directly to his 2006 campaign, $16,000 more in airplane travel and $25,000 more to the Democratic Governors Association

Attorneys for Janssen are not making the argument for BPB's disqualification based on the contributions given to Rendell, but have mentioned them in several briefs.

"Mr. (Kenneth) Bailey's contributions of more than $100,000 to the Governor and the Association just as the Governor's General Counsel negotiated and executed its no-bid contingent fee contract with Bailey Perrin are relevant because they give rise to a distinct notice of impropriety, thereby making it unlikely that litigation decision-making by Bailey Perrin will be perceived as fair and impartial and solely in the public interest," one reply brief says.

"The contributions are further relevant because they are indicative of the sort of abuse of executive power that the doctrine of separation of powers was meant to check."

BPB had written, "Janssen's gratuitous identification of campaign contributions are no more relevant to the resolution of this matter than political contributions (Janssen counsel) Drinker Biddle & Reath's Political Action Committee made to various candidates presumably aligned with Drinker's and/or its clients' interests, which totaled nearly $120,000 during the 2004-06 election cycles."

Bailey has contributed heavily in other states, also giving $50,000 to Mississippi Attorney General Jim Hood, who hired BPB to pursue a claim against Eli Lilly & Co.

In Louisiana, another state BPB is representing in litigation, Bailey gave $20,000 to the state's Democratic Party. In Arkansas, which hired BPB for a suit against Janssen, he gave $70,000 to the Democratic Party in 2006.

Attorneys for Janssen argue that counsel representing a government office should be motivated by justice, not money, and that BPB is controlling the decision-making instead of someone from the Office of General Counsel.

"There wasn't the slightest bit of pay-to-play here," Rendell told the Philadelphia Inquirer. "I never put a dime of state money in jeopardy for Ken Bailey."

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

Alabama chief justice decides against gubernatorial run

Chris Rizo (csrizo@hotmail.com) — Thu, 02 Jul 2009 13:19:00 CST

MONTGOMERY, Ala. (Legal Newsline)-Alabama Chief Justice Sue Bell Cobb says she will remain on the state's high court rather than run for governor in 2010.

Cobb, the only Democrat on the nine-member court, was elected in 2006 to a six-year term as chief justice. To run for governor, she would have had to resign from the bench.

"I will continue to work tirelessly to improve the court system of this state and will continue to devote my time and energy to programs and projects that improve the lives of all citizens of Alabama," she said in a statement Wednesday.

Already in the Democratic race to succeed Republican Gov. Bob Riley, who is barred from running for a third consecutive term, is: U.S. Rep. Artur Davis of Birmingham and state Agriculture Commissioner Ron Sparks.

On the Republican side, state Rep. Robert Bentley of Tuscaloosa, former state Sen. Bradley Byrne, state Treasurer Kay Ivey, businessman Tim James, former Birmingham city councilman Bill Johnson and former state Chief Justice Roy Moore are running.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.