Wednesday, August 27, 2014

Law Firm Conflicts Allegations in the News

A few interesting stories making news. First: "The mysterious case of Hewlett-Packard’s Autonomy deal"--
  • " of the law firms that represented the shareholders in their case against H-P directors, Cotchett, Pitre & McCarthy LLP, now working with H-P, is being accused of a conflict of interest. Cotchett was previously the lead counsel in another class action against H-P. That suit, which also recently settled, alleged that the company’s inkjet printers falsely warned consumers when they were out of printer ink."
  • "Theodore Frank, of the non-profit Center for Class Action Fairness, has filed a motion contesting the ink jet settlement, seeking to disqualify the Cotchett firm... 'It’s just a black letter ethical violation,' Frank said... 'The inkjet litigation has no bearing on the Autonomy settlement,' an H-P spokeswoman said in an email."
  • "Rodney Cook... has his own separate derivative action against H-P regarding the Autonomy deal, also seeks to remove the Cotchett law firm as the lead plaintiff’s counsel, citing conflict of interest."
  • "One challenge has been filed by Autonomy’s former chief financial officer, Sushovan Hussain, who contends that the proposed settlement H-P poses a threat to his own legal rights... Hussain’s motion brings up a bigger question about the Autonomy acquisition. He states in his motion that with the settlement, 'H-P seeks to forever bury from disclosure the real reason for its 2012 write-down of Autonomy: H-P’s own destruction of Autonomy’s success after the acquisition.'"
  • "How this became a multi-billion-dollar write-down is a big question among investors. Perhaps these legal maneuvers will shine some light on the mystery. But it probably will be a long time before investors know what really happened."

Next: "DOJ: Hacking suspect's lawyers may face conflict"--
  • "Two attorneys representing the son of a prominent Russian lawmaker may face a conflict of interest because their firm represented victims of a hacking scheme he's accused of running, the U.S. Justice Department said Wednesday."
  • "Ray and Goldin are attorneys with Fox Rothschild, a national firm with 600 attorneys and 19 offices, according to its website. Ray succeeded Kenneth Starr in 1999 as the independent counsel on the Whitewater investigation. Seleznev is also represented by Seattle defense attorney Larry Finegold."
  • "'We feel strongly that our representation comports with all applicable rules of ethics and that Mr. Seleznev is legally entitled to vigorous defense - which we intend to provide,' Goldin wrote in an email Wednesday."
  • "Assistant U.S. attorney Norman Barbosa said the government was not implying any wrongdoing by the defense attorneys, only raising the question of whether they should continue to represent the defendant when at least one other attorney in their firm represented the pizza chain Z Pizza in connection with a breach in late 2010 and early 2011 that resulted in the theft of thousands of its customers' credit card numbers. Seleznev was responsible for the hack, prosecutors say."
  • "The government noted that if Seleznev is ultimately ordered to pay restitution in the case, Fox Rothschild could wind up representing both the defendant and the people he is required to pay. And if anyone from Z Pizza is called as a witness in the case, the firm could wind up cross-examining its own client.'
For more detail (and intrigue) on the case of an alleged hacker the US Secret Service calls "one of the most prolific in the world," see: "Accused Russian hacker must stay in custody, judge says," which covers details such as an arrest at the Maldives airport, a seized laptop containing over 2 million stolen credit-card numbers, and Russian allegations that the suspect was kidnapped...

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